Public Water Utility in Saudi Arabia - Essay Example

Change Management Impact on Organisational Culture: Case of a Public Water Utility in Saudi Arabia Project Proposal submitted in partial fulfilmentof the course requirements for the Masters in Business Administration University of Leicester Management Centre Table of Contents Table of Contents 2 Abstract 3 Introduction 4 Research Objectives 4 Importance of the Study 5 Relation to Previous Research 5 Organisational Culture and Performance 6 Organisational Culture and Change 6 Change Management Principles, Tools, and Methods 7 Leadership and Change Management 7 Research methodology 8 Methods of Data Collection 8 Methods of Data Analysis 9 Reflections 10 Conclusions 12 Timetable 12 Bibliography 14 Abstract The project paper investigates the impact of the change management programme on the organisational culture of the Ministry of Water and Electricity in Saudi Arabia in the context of its ongoing privatisation. Using managerial practices acting as independent variables, we look at the relationship between ongoing change management efforts and cultural changes, applying statistical and regression analysis on datasets derived from a survey of 400 employees at the Ministry's branch in Riyadh. The study focuses on the familiar change management principles to overcome resistance to change and facilitate cooperation within an organisation undergoing a radical transformation process and provides a potential model for similar organisations in the region. Introduction Globalisation exerts pressure on companies and governments to adopt policies of liberalisation and privatisation, aimed at securing a more efficient use of resources and improving the quality of life (Brittan, 1986; Kay and Thompson, 1986; Micklethwait and Wooldridge, 2000; Stiglitz, 2000 and 2002). Saudi Arabia is adapting to this global phenomena with economic reforms to promote growth, increase foreign investment, and expand employment opportunities. Caught amidst these changes are organisations and workers undergoing radical transformations in their cultures and work processes. Unless these changes are managed well, liberalisation and privatisation cause severe human suffering, lead to economic failure, or in its worst case, push a country to turn its back on globalisation (Machovec, 1995; Vickers, 1995; Fischer, 1999; Summers, 2000; Stiglitz, 2000). Change management, therefore, affects the outcome of transformational forces in organisations. Our paper investigates the impact of change management on the restructuring and privatisation of the public water utility Ministry of Water and Electricity in Saudi Arabia, (hereafter MOWE) and its transformation into a privately-owned organisation. We examine the importance of reducing staff resistance to change and aligning their behaviours and values with the strategic requirement of the change programme. We also look at measures to elicit targeted behaviour such as making the organisation more customer-orientated. Research Objectives The research study attempts to answer the following questions: How does change management affect the public organisation's culture during the transition period How does change management reduce employee resistance What are the effective tools and methods to change organisational culture What kind of leaders and leadership style are effective in leading change Does change management make any difference in cultural change What dimensions of organisational culture could be changed in the organization Importance of the Study The study will contribute to the existing body of research in two major ways: First, by focusing on an organisation in Saudi Arabia, the research will be an important addition to the body of literature on change management predominantly founded on western models. Second, documentation of change management and their effects on public sector organisational culture in an Arab country act as a useful guide to policy developers and decision makers facing similar challenges in other Arab countries. Relation to Previous Research We look at the key factors influencing change management: organisational culture and performance, change management principles, and the value of leadership. Every organisation is subject to internal and external changes. Our paper investigates why some organisations succeed in managing change, whilst others do not. Organisational Culture and Performance Scholars argue that organisational culture -the shared, symbolically constructed assumptions, values, and artefacts of particular organisations - underlie organisational effectiveness to manage change. Its culture allows the organisation to learn how to face challenges and difficulties, and become stronger (Mohan, 1993; Haveman, 1993). Several definitions of culture help us understand how organisations operate, survive, and thrive in free markets (Herskovits, 1955; Hofstede, 1980; Deal and Kennedy, 1982; Peters and Waterman, 1982). What seems clear is that culture, by influencing human behaviour in organisations, affects organisational performance; and that culture as a variable could be manipulated to ensure success (Kotter, 1996 and 2002). Several studies of successful firms attempted to determine organisational cultures that contribute to competitiveness and innovation (Pascale and Athos, 1982; Peters and Waterman, 1982; Kanter, 1984). Organisational Culture and Change Two types of change challenge and impact organisations: incremental changes that alter small aspects of the business or its work processes, and radical, strategic, and transformational change (Nadler and Tushman, 1989 and 1990; Blumenthal and Haspeslagh, 1994; Hutt, Walker and Frankwick, 1995) Although most change management literature applies to private, publicly-owned firms, studies on government-owned firms that share cultural similarities with MOWE showed that change can be difficult in public sector organisations because of issues related to workforce recruitment and skills, interpreting the evidence on what works, competition, inadequate internal accounting systems, incentives and lack of clear objectives due to differences in cultures between these two sets of firms (Kotter and Heskett, 1992; Rosefielde, 2002; UNDP, 2006). Change Management Principles, Tools, and Methods Kotter (1996) and Fisher and Savage (1999) argued that sequentially following a set of principles increases the probability of success. Various change management models can be summarised into the following key principles that have a strategic dimension (Chapman, 2006): 1. Secure involvement, agreement, and support from people within the organisation. 2. Understand where the organisation is at the moment. 3. Understand where the organisation is going, when, why, and how it will get there. 4. Plan to bring the organisation from where it is to where it wants to go. 5. Communicate, involve, enable, and facilitate involvement from people as early and openly and as fully as possible. Management leadership facilitates the willingness of employees to embrace or resist change (Lawrence, 1954; Strebel, 1994; Maurer, 1996; Waddell and Sohal, 1998). We can assign and measure variables to help identify problem areas and determine the probability of success. Leadership and Change Management The success or failure of change depends on: strategic orientation of top management, degree of structure inertia, top management awareness of the quality of the organization performance, and internal and external pressure to change (Sastry, 1997), degree of trust between employees and management (Haveman, 1993), and the quality of leadership (Heifetz and Laurie, 1997). Research methodology The paper is divided into: (1) introduction; (2) literature review; (3) research methodology; (4) summary of data; (5) analysis of data; (6) conclusion and recommendations; and (7) abstract, references; and appendix with our questionnaire and summarised interview transcripts. Methods of Data Collection There are three basic types of questions to be addressed: causal (whether a variable causes or affects another), relational (relationships between two or more variables), and descriptive (describe what is going on) (Saunders, 2003). We will make use of primary and secondary data, and to avoid the one-method bias, two sets will be collected for each. Primary data will be gathered through a survey questionnaire and interviews. After securing top management support, a questionnaire will be self-administered to 400 (of 2,000) MOWE employees at its Riyadh office using a quota sampling technique to ensure all organisational levels and functional areas are represented. The questionnaire measures employee attitudes towards change, management leadership, and the change process using a five-point Likert scale. Semi-structured interviews with top management and steering committee members will provide data on change issues. We use a purposive or judgemental sampling technique to select interviewees based on strategic expertise. This is best suited "when the researcher wishes to select cases that are particularly informative" (Neuman, 2000 cited in Saunders et al., 2003, p. 175). Compared to other sources, interviews provide first-hand information, the best form of primary research. Secondary data from archives and published reports provide demographic characteristics of management as a measure of willingness to lead change. Reports give statistics on training across organisational levels and functional areas. Using this combination will help establish linkages amongst variables and measures: 1. Management ability to accept and lead change as measured by looking at actions, qualifications, and statements. 2. Employee attitudes to change, management, and the process as measured by training participation, job attitudes, and understanding of internal (culture) and external (privatisation) change factors. Methods of Data Analysis Quantitative data from primary sources will be analysed using appropriate quantitative techniques. Descriptive statistics describe the sample and measure the normal distribution of data. Simple and multiple regression methods will determine the statistical significance of cross-sectional data and test relationships between techniques of change management and different aspects of organisational culture. Analysis of variance (ANOVA) will determine whether there exist differences between departments or organisational levels with respect to resistance to change. Reflections The study presents both practical and empirical challenges to the researcher. The practical challenges include the final questionnaire design, the choice of respondents and how to assure the sample provides a cross-section of the MOWE population, how to minimise response bias, the timely collection of the completed survey, scheduling of interviews, and the degree of access to be provided based on degree of management support. The empirical challenges include the specification of variables to be tested, the interpretation of the data, and validity of the assumptions that the organisational and national culture of an Arabian government firm can be studied using western-based change management principles and that interpretation of statistical findings would allow the formulation of valid conclusions. We also foresee questions on the potential application of our findings on other Arab countries, government organisations, and utilities. We hope the study becomes a worthy contribution to knowledge on this topic, and that the rigour of statistical analysis allows other countries and firms in the region to conduct similar structured studies. However, we need to make clear that although our findings would show the correlation of change management variables as they apply in MOWE, it may be tested in other firms and in other countries. The research process could be applied to other firms: mapping out the unique organisational culture, investigating how this culture determines organisational performance, identifying variables that measure the culture's adaptation to change, and showing the relationships amongst these variables to forecast the success or failure of change management. One issue arising from the study is that of the ethics of change, which can be understood at different levels from both a broad and narrow perspective. Ethics, the study of right and wrong behaviour, can likewise be applied at different levels within the organisation, from the lowest-ranked individual to the highest member of top management. Reflecting on the forces of change, the questions that come to mind are the following: If change is imposed from outside and results in a situation totally different from the existing, who determines which organisational response is right or wrong Why embrace change to assure the organisation's business viability at the cost of tremendous human sacrifice on the part of workers Why adopt policies that would assure business survival (e.g., raising water tariffs) but make poor people suffer And how can we say that a worker who resists change is doing wrong, whilst the opposite - the management who leads change and the employees who embrace it - are doing what is right Our study therefore would make the following assumption: that when a business organisation - its leaders and workers, acting with what it perceives to be the good of its customers and other stakeholders in mind - follows what its government allows or even encourages it to do, then we can assume that the organisation is doing what is right. This line of reasoning simplifies our ethical considerations into one that is compatible with the objectives of our business course. Conclusions The paper will conclude that managing the change process is important to business survival by showing that a set of identified variables that reflect the organisational culture, employee behaviour and values, and management leadership result in MOWE attaining its business strategies and objectives and its workers improving in their level of job satisfaction. The main limitation of our study is that we do not directly measure the effect of change on other stakeholders such as customers, suppliers, and government regulators who are equally important for the business. However, we would be able to measure the reaction from these stakeholders using secondary data, such as improvements in profitability and the level of support coming from these sectors. Once this research proposal is approved, we proceed with the implementation of the plan specified in the next section. Timetable The project will take six months from approval of project proposal to submission of final draft. This time frame has taken into consideration all probable causes of delays due to events with a slack of two weeks added throughout to provide for unforeseen delays. All stages of the project implementation will entail close collaboration between the researcher and the supervisor. Table 1 contains a Gantt chart of the project implementation plan. Table 1: Timetable MONTHS 1 2 3 4 5 6 Literature Review Measurement Development Data Collection * Data Analysis Writing of First Draft Writing of Final Draft * One day will be allocated for pilot testing. Bibliography Adeyoyin, S.O. (2006) Managing the library's corporate culture for organizational efficiency, productivity, and enhanced service. DigitalCommons@University of Nebraska-Lincoln. 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