Change and Reasons for Strategic Need for Change - Assignment Example

Student Name: Tutor: Title: Assessment Task 3 Course: Assessment Task 3 1. Description of the change and reasons for strategic need for change The Global Financial Crisis had adverse effects on the growth and profitability of the company. The clients have cut back their purchases by 50% in the last six months. The two competitors in the business have become aggressive despite the impact of the global financial crisis. They have become tougher competitors and the company is the risk of losing out. The company has to maintain its market share and look for ways of countering the slashing of orders from its current customers. There is need to improve efficiency and gain advantage of the competitors in the market. A new client has been secured through the efforts of the marketing and sales department. The client has tougher contractual agreement and has sophisticated systems that need to be implemented. The organization has to adapt to the required new systems of the new customer or risk facing uncertainty as well as possible closure in the next two years. There is need to purchase the new SAS which is user-unfriendly and train the employees how to use it. The company has to spend money on implementation of the new system and train its employees on how the use the user-unfriendly system. The company has to overhaul tracking, purchasing, administration, and compliance framework. The organization has also have to come up with new procedures and policies. The company has to implement change or risk losing out in the business to its competitors. The marketing and sales department has to be very aggressive and secure other customers. 2. SWOT analysis in relation to intended change Strengths The indented change will enormously benefit the company. The new client will bring in $1million in terms of income. Training of employees and implementing the new system will enhance efficiency and productivity of the company and give it a competitive advantage. The new client is enormous and if he is secured, the company will realize growth and profitability. The old system of the company will be replaced with a more sophisticated system. Weaknesses The new system that has to be implemented is user-unfriendly and will cost a lot in terms of training and implementations. The system will cost $250,000 for the company for all the employees. Implementation will require an extra $10,000 and five thousand dollars for labor. The old system will be rendered obsolete as the company implements the new system. The system will also need time to implement. This will affect the productivity of the company and its profitability. Opportunities The employees will have a chance to be trained on new technological skills that will be needed to carry out functions with the new system. The organization efficiency will improve and it will have the opportunity to deal with other sophisticated cases that may arise. The company has also has an opportunity to assess and evaluate the resources available and ensure maximum utilization in the company. The company will take the chance to ensure that all employees are computer literate and those who cannot adapt are laid off. The change plan will propel production to new level. Threats The older and loyal personnel in the company will find a problem in the event of implementing the new system. The older people are not computer savvy and have been in the company for over twenty years. There is a threat that some of these people will not adapt to the new system and the company has to lose some of these people if the system is to be implemented (Finch, 2011, p.5). However, if the company chooses to train these old employees who are not computer savvy, it will spend a colossal amount of money and time. Meanwhile there is no time to waste and the company has to implement the new the new system or risk losing the new system. The system is sophisticated and it needs people who are computer savvy. There is also a threat of lack of compatibility of the new system and the previous systems that the company had. 3. Cost-benefit analysis on the intended change The company will spend $50,000 to buy SAS for ten users. The organization has fifty people. The company will spend: (50÷10) ×50,000 = $250,000. Implementation and training cost is $10,000. Time and labor cost is $5,000. Total cost is SAS costs+ implementation and training + time and labor = total costs. Total costs = (250,000 + 10,000 + 5,000) = $265,000. The cost of purchasing, implementing and training and labor and cost is below the benefit that will be drawn from the new customer despite the stringent contractual terms. The marketing and sales department has secured a client worth $1million. If the cost of the purchase and implementation of the system together with the training and labor costs the company will still post a profits of about: 1,000,000 -265,000 = $765,000. The benefits that will come with the implementation of change are worth going ahead with it. It is important to implement the new system in order to secure the new customer who will bring more returns to the company. 4. Barriers to changes and minimizing strategy Implementation of the change in the company will get opposition from the old employees who are not computer savvy. It will also take a lot of time if these old employees have to be trained on the new system that is sophisticated. The company has to look for money for implementation of the new system. The cost is enormous but credit financial institutions can be used to fund the project since the returns from the system implementation is worth the costs. Another minimization strategy to the implementation of the changes in the organization is carrying out awareness of the impending change. The employees have to be fully educated on the need of the change and the risk of conforming to the old system. The new client has to be secured whatever it takes for the company. Workshops and training programs on the change and the new system will ensure that the change is accepted by the members of the organization (Kneer, 2009, P.6). The organization culture has to be changed to reflect the change in the operation of the organization. Employee education will overcome many barriers to the change implementation plan. 5. Change management project plan The company will spend $265,000 on employee training as well as implementing and labor costs. Time will also be needed as a resource in training and implementation of this change. The right leadership is needed to champion the change in the organization. The leadership has to identify agents of change in the organization and encourage them to spread the message of change in the organization. Departmental heads have to be trained and educated on the need of the change in the organization. The top management is the first part of the organization to be targeted with the change program. Sensitization programs have to be designed for all members of the organization. The company has to invest heavily in employee education in order to facilitate the change implementation. The company will have to hire experts in the new system in order to carry out the training program. 6. Communication/education plan The objective of the communication or the education plan is to prepare the organization community on the impending change. The community in the organization has to be prepared psychologically and mentally for the change. The objective is also to bring everybody in the company on board and have them geared towards the change. The culture of the company has to be aligned with the new system anticipated in the organization (Ireland, 2006). The employees have to adapt to the new system that has to be implemented. Technological adaptability has to be one of the criteria of employment in the company. The education plan will target all members of the organization from the senior management, to line managers to departmental heads. The old workers have to be equipped with computer skills that will make them cope with the demands of the new system. In terms of tools, the management will have to buy educative software programs and computers where employees have to learn the new skills in technology. Manuals and other reading materials on the new system have to be provided to all employees in order to keep pace with the sophistication. The timing should start early and training on time. The change agents identified in the company have the responsibility of spreading the message of the change in the organization. The training has to be an ongoing process in terms of frequency until all the employees are competent enough to deal with the sophisticated new system. The employees have to be conversant with the stringent contractual agreement of the new client so that there should not be mistakes. The benefits of the change have to be explained to all employees. 7. Activities to deliver education/communication plan and create opportunities. The company has to start by ensuring that new procedures and policies are mastered by all employees. The culture of the company has to emphasize on punctuality so as to create time for learning. Identification and sensitization of agents of change in the company Preparing the employees who cannot cope for early retirement. Gathering information on possible barriers on change implementation. Evaluating the impact of the system change on the organization performance Reviewing the acceptability of change in the organization and working on minimization strategy. 8. Risk management plan The organization has to carry out internal survey in the perception change after educating the employees on the change. The education on the impending change has to take at least three months before the survey on change perception is carried out. The organization has to determine the source of resistance to change and address the issues of concern (Paton & McCalman, 2008, p.15). Where the employees have not understood the need for change, comprehensive education has to be carried out. The organization has to take two months addressing issues raised against the change. The underlying reason has to be employed to the employees. The company risk being closed in matter of two years if it does not adapt to the changes in order to secure the new client. The organization has to employ experts to explain the need for change to the entire organization. The impact of risk will be delaying the change management plan. The change itself is inevitable and has to be implemented. Moreover, the organization will use more resources in terms of time and money in overcoming the risks of resistance from the employees. Sensitization will go along way at making the employee be aware of the change and embrace it fully. 9. Activities embed change The culture of the organization has to be change to be aligned with the change. It is imperative that future employees of the firm should be computer savvy and ready to learn through training and development. The policies and procedures developed have to be encouraged in the entire organization. The evaluation and review of the system or change implementation have to be done every three months to ensure that everything is on track. The implementation of the change should not take more than eight months. This will involve education, addressing resistance, training, and implementation. The review has to give feedback on whether the change is progressing as planned and whether there is need for something else to be done. Refresher courses for employees have to be offered every six months to ensure that they are compliant and competent in regard to the new and sophisticated References Kneer, C., 2009, Change Management, GRIN Verlag, London, p.6. Ireland, L, R., 2006, Project Management. McGraw-Hill Professional, Paton, R.A. & McCalman, J., 2008, Change Management: A Guide to Effective Implementation, SAGE, New York. p.15 Finch, E., 2011, Facilities Change Management, John Wiley & Sons, London, p.5 Read More