Change Management is a set of Processes of planning, organizing, and implementing change in order to achieve best result in an organization. Change management is the result of any failure of a strategy that means when a part of a strategy fails to show desired results then there is a need of change. Basically the change management is a part of strategic management and the purpose of change management is to change the unsuccessful strategy to obtain best result by utilizing all of its resources. Changes can be made in a strategy and you can not change the goals or objectives of a business.
Organizational Change management
Organization change management is a process in which you bring and manage changes in an organization for the batter performance of the organization. To improve the quality of out put and find the ways to increase the customer's level of satisfaction. Find the ways how to compete the competitors and find the techniques to reduce the cost without disturbing the quality of a product.
Significant change in an organization
Organization changes are made due to many different reasons which are discussed below.
- To compete the competitors in market
- For smooth running of business
- To increase sale level
- To introduce new technology
- To improve the performance of organization
While making change you should consider your customer in your mind because sometime your customer do not like changes and that bring negative impact in your organization and sometime company makes so much profit by introducing changes.
Only making change in a strategy is not only the thing you companies make the changed strategy perfectly but the fail to implements the strategy and even organization implements strategy very nicely but it fails to control it and cannot have proper check and balance on it. A good strategic manager should also develop a changed strategy and implement and even maintain it without disturbing the quality of the product.
Formal and informal organizations
There are generally two types of organization formal and in formal. In formal organization an organization follows each and every aspect defined in its mission vision statements, goals and objectives and each and every thing is properly documented and follows all procedures while in informal organization company do make any documented record most of the things are verbally and orally. But formal organization can make good changes and maintain it and can also view the success percentage of changes because all things are written and can analyse easily.
Bureaucratic organization is an organization typified by formal processes, standardization, hierarchic procedures and written communication
That means bureaucratic organization is an organization where all powers are assigned to a specific person or department there is a centralized power system and each and every task is done according to described rules all communication should be in writing form.
Strengths of Bureaucratic organizations
Following are the strengths of a bureaucratic organization
- All process are controlled by superior management
- All communication is done in written form
- Division of work is done according to systematic way
- All employees knows their duties and responsibilities
- All process is monitored by authoritative person
- No chance of communication gap
- All rules and regulation are pre defined
- Hierarchy structure
Weaknesses of Bureaucratic organizations
- No innovation proves
- Too long hierarchy chain
- Prolong communication
- No dialogue process
- Long and delay process
- Delay decisions
- Lack of communication among top management and employees
Comparison of alternative forms of organizational development
Inventions and innovation that are made in an organization for the development are called organizational development. These inventions and innovations are pre planned, and applied in an organization in the systematic way, all strategies which are not showing desired results are studied thoroughly and all aspects that are creating problems in the development of organization are revised and changes are planed and implemented in a systematic way.
Different types of Organizational Developments
Four main areas which require development of change are discussed below.
Human process needs changes and developments. Highly skilled workers are the assets for a organization and a successful organization always conduct some training and development programmes for their workers. In an organization workers are categorized into many groups like production team, marketing team, account staff, clerical staff, customer service staff etc. all of them have different trainings programmes. If the workers are divided into groups and changes are made for a particular group they can understand and adopt the changes easily.
Structural changes are made for the structure of an organization that means an organization wants to reduce its hierarchal chain for the smooth running of business and smoothly flows of information from one end to another end and also for quick decision where it need keeping in view that quality of product do not disturb some time powers are also assigned to a specific department for the batter performance.
Human resource management (HRM)
As discussed earlier that human is the basic factor for the success of business the company should review their performance and organise some programmes for their batter performance also give them proper reward because if employees are satisfied they do efforts more for the success of a business.
Strategic innovation is the creation of growth strategies, new product categories, services or business models that change the game and generate significant new value for consumers, customers and the corporation.
That means the strategic innovations holistic, multidisciplinary framework that enables organizations to take a strategic approach to innovation.
Task 2: System Development
As the time passes the automobile industry need to bring changes in policies and its infrastructure to survive and compete in the international market. Basically automobile industry is a very large industry and there are many brands that available in the market. To survive every automobile industry has to research and introduce new technology and design in every upcoming model.
Ford is one of the leading automotive manufacturing companies in the United States. Based in Michigan in 1903 by Henry ford and grew to reach revenue of $150 billion and more than 370,000 employees by 1996 .
In the 1970's, the automobile manufacturing industries (General Motors, Ford and Chrysler) was crunched by foreign manufacturers such as Honda and Toyota. In 1999, Ford took steps to compete the foreign market by acquiring the Swedish Volvo model and expanded it to other regions as well. Furthermore, Ford launched a fully organized re-engineering manufacturing process plan called "Ford 2000" aiming at re-establishing the infrastructure of the company. The process was to reduce their vehicle centres to only five covering operations which spanned 200 regions. It also meant to cut down redundancies and to require Information Technology (IT) to be the driving force and the link between the Ford centres worldwide.
Organisational development against change in automobile industry
Human nature is to react against the change. Automobile industry need to change their human process to achieve change efficiently and effectively. They need to organise the team work for the change.
Strategic Planning against the change
Automobile industry needs strategic planning to bring the change to survive in the market of the United States. Ford need to plan how to implement change and earn profit from the changes.
These are the participants who could be affected by the change process. In automobile industry directors, managers, share holders, transporters, suppliers, government and financing institutions are stake holders. We have to identify stakeholders affected directly or indirectly by the change. And also we have identified the resistances against the change by the stake holders.
Purpose of Stakeholders Analysis
Main objective of the stakeholders' analysis to clarify the following things:
- To recognise and categorise the main stakeholders being affected by the organizational change
- To analyse the reaction of stakeholders against change
- To get the attentions of the stake holders about the change
- To find out the stake holders who resists and support the change
- To get the positive response from the stake holders
- To cooperate with the Stakeholders for implementation of the organizational change
Resistance against Change
After identifying the stakeholders the next step is to work out the resistance against the change.
- Cultural barrier to change
All the systems, techniques and methodologies being used, are very hard to change to the new one. The change in the culture of the automobile industry i.e. Ford could be very hard to understand the new system.
It is again a vital barrier to change. The change needs more trained people and implementing this change could be very expensive. Especially for the customers, use of new technology will increase the cost of motor for the end user.
- Willingness of the Stakeholders
In this case, the employees could not be willing to accept this change because of it confusing nature, strange methodology and new organization has to face lots of problems for implementing this change.
Bringing change in short span of time could be very hard and is barrier to change.
Above mentioned are the factors which could discourage the Stakeholders to accept this change and it could be very challenging situation for an automobile industry.
Task 3: Implementation
Appropriate model for change
The world today is ever changing moving from one phase to another and only the thing that does not change is 'change' itself. As the modern business environment is propelled by the three Cs namely Customer, Competition and Change, organizations are always looking for new business innovation to salvage their ailing enterprise.. (Hammer and Champy, 1993) One of such solutions that have been identified and used by many companies is the Business Process Re-engineering or shortened as BPR
There are many different views about the management of change in an organization but John Kotter has been accepted a change management guru, gave an eight step approach for managing a Change in an organization, leads a great impact of change management effectively and efficiently.
- Create a situation when the change is required
There are two different approaches about changes one is that wait for the market and time there must be a time that others change their strategy and adopt new techniques or technology to compete the marker or earn more profit and there are one more group who make suddenly make a trend of changing develop, and implement changes this group create such situations in the market that all business competitors always think about changes.
Ford motors totally change its infrastructure and make such trend that other automobile also adopt it.
- Discuss the threats about the change
While planning a change you should also keep in mind about the threats of changing that your business may face regarding changes. Develop such strategy that can completely overcome the problem of threats.
Ford motors wants to cut off their cost and want to also make more customer and sale. It launch web technology and provide all information about their products on the web and it reduce its cost by closing its outlets from many different cities of all over the world.
- Find out the opportunities
You should have to think about the opportunities of the business that either you have to introduce new models or you have to explore new markets.
Ford motors find out the opportunities regarding its business by making some changes in the model and also explore some new market by approaching to the developing countries.
- Explain the more convincing reasons
While finding out the opportunities for the business you should have to focus on the opportunity that is suitable for your company and your company can easily afford and adopt it.
Ford had launched its plan to update its infrastructure, and seized the opportunity brought by the global movement of integrating the voice, fax transmission network with data transmission and expanded its WAN to include its offices in Europe and elsewhere.
- Ask about the customer support
While discussing about the changes you should be keep in mind the either your customer will support it or not. Make such plans that are also suitable and more convenient for your customer.
Step Two: develop a strong Union
To make and implement changes ford make a strong union. Ford want to introduce web technology for this purpose it organize and built a very strong team and make user friendly web that also reduces its training cost that everyone can enter information on the web and it also make a team that properly organize and control the data on the web.
Step Three: A clear Vision for a Change
To make and implement changes you should have a clear mission that what you want to do actually. Your all staff members must know about the actual purpose that what to do and for what to do. Why you are making the changes. Ford motors had a clear mission that it want to make more sales and explore more markets and also compete its competitors and also want to cut off its cost.
Step Four: Tell the Vision
Once you have decided to make and implement changes and you have a clear mission you should have to tell your vision to your employees and also to your customers. And take view of your employees and your customers as well. All of the ford motors employees were fully aware about the planning and they have complete knowledge about the vision that what they have to do and for what they have to make changes.
Step Five: Take out all the Barriers
Make changes is not so simple. It is very difficult and there are many barriers that should be removed that can obstacle the way of changes. Ford motors had make such strategy that others cannot copy it and it also owned the Sweden Volvo and also partially owned the Mazda to gain the competitive edge. Its web technology also requires very huge amount that others cannot copy it easily. And ford motors also registered its new innovation. It tried to almost remove many barriers that can obstacle its way during implementing the changes.
Step Six: Develop a short-term Wins
Develop such strategies that can be implemented and shows result in short term to obtain and determine the progress and success percentage of the strategy. Do not try to make such strategy that needs very long time to show the result. If something goes wrong you can change it easily and short term tasks are also supervised and implemented easily.
Step Seven: Move ahead for a Change.
After covering above six steps now it is the time to implement the changes. You should have to develop the ways that how to implement the strategies. Each and every aspect should be discussed in briefly for the implementation for the strategy. Ford motors have also worked on each and every aspect that how it will implement the changes to obtain the desired results. It launched the web technology and provides all its data on it and also cut off its outlets from the several regions to save some cost step by step.
Step Eight: attach the Changes in organizational Culture
The last and foremost step is that how you will justify the changes made by you in your business strategy and how you will support and attach it with your organization culture. While making changes you should have to also concise on the culture of your organization.
- Robert D. Austin and Mark Cotteleer,"Ford Motor Co.: Maximizing the Business Value of Web Technologies." Harvard Business Publishing. July 10, 1997. harvardbusinessonline.hbsp.harvard.edu/b02/en/common/item_detail.jhtml;jsessionid=WDARNHINBSYKSAKRGWCB5VQBKE0YOISW?id=198006 (accessed July 30, 2008).