Management of change
Introduction
The case study
Frameworks and literature review
Discussion
H group
Start up growing - started in 2013
Was used to be centralised on the CEO, involved in all projects and taking all decisions
Got funding of 1.6M Euros
Objectives to grow quickly and expand into SSA to limit the risks
Small team with no processes
In the construction before moving to interior design space in Kenya
Some International competition entering the market
But need to develop better operational processes
With rapidly growing team with additional departments and expertise not present before
Pettigrew's model
Not a completely concious trigger to change
Mainly growth of team and volume of activity - startup going from small firm to fast growing company
Not possible to be handled by a handful of people
Need to put systems in place to communicate more efficiently among teams and across departments
Difficulties / barriers
New team members joining and bringing new expertise with different technics / systems
Lack of corporate historic - employees leaving and no organisational knowledge remained
Resistance to change
Had to urgently change the culture to bring consistency and efficiency
Ambidextrous organisation
But management not really aware of the change process needed to the culture
Initiatives
ISO 9001 standards project
IT Storage systems standardized
Intranet created
Many initiatives launched at the same time
As taken by day to day operations still ongoing and not investing in building the systems
Need to learn how to work together, in between departments
Project management tools
Change not really managed
Old employees used to work in a certain way - not very open to new systems
New employees somewhat open but trying to push for the tools they know and ways they used before
Lack of commitment from management as a whole - lack of plan
CEO not clear in the directions / Vision of change and employees involvement
CEO not respecting systems changes and sending contradictory message
Lack of a vision and the fear of the learning curve
Leadership vs management
the context (Why change), The content (what to change) and the process (how to change)
Lewin's models
For Kotter 1990 Managers foster the stability of an organisation while leaders envision the change necessary to grow and go through revolution stages
For Caldwell, leaders are essential in "sponsoring strategic change", and change would fail should the leader not be able to create and nurture an inspiring vision (Change leaders and change managers - p286)
Systems and process Manager recruited
Too many important changes implemented on a short period of time
Galbraith's star model
Coupled with Contingency theory
Create alignment in the organisation through policy design
If you change one you may have to change the others to find the alignment again
A change in structure and processes implies a possible change in other areas
Then changing the culture on the long term
Lewin's three stages process model
Balance between forces
Forces for change must be stronger than forces against change
Kotter's model
How leadership is the link between the various elements
Seen in other models: Galbraith, Weisbord,
How to overcome employees resistance
8 steps model - "Leading Change: Why Transformation Efforts Fail"
Comparison with Lewin's - quite similar although the change part is more developed hence useful
More detailed to guide the change
As a main barrier to the change process
The different employees resistances - new employees vs old employees
Kotter and Schlesinger’s six methods to overcoming resistance to overcoming resistance to change - "Choosing Strategies for Change"
Greiner's model
Preferred to accompany the change process and plan it
Evolution and Revolution
Explains where the company is - going through a revolution
Must guide the change process throughout and give clear directions
The Star model
Overemphisazing structure in the light of power (Galbraith)
IN fast changing environment, structure less important
Processes, reward and people are becoming important
Similar to Weisbord
Greiner's model
The company is entering a revolution phase
Having worked through a very creative evolution phase
Created growth and success
With a small team and very few processes
Entering the leadership crisis phase
Need for decentralizing the decisions and management
But still keeping the focus and the direction (vision)
Showing the need for a change period to go through one phase to the other
Vision / Purpose / Objective / Direction
Recurrent notion in literature - importance of creating a clear vision
Most papers agree on that notion as a pre-requisite to change success
The appearance of a revolution here may not be linked to the rate of growth of the industry - but rather to exterior events like the raising of funds allowing acceleration of company growth
Essential to go through the revolution stage to restabilize the structure and enjoy continuous growth
But again need to take external environment forces into considerations
Create some unexpected revolution stages
Maybe unconciously going to fast to the delegation phase, with autonomy crisis.
Things are hardly linear and we could have crisis happening at the same time, with managers requesting more autonomy and delegation while the CEO has not properly gone through the leadership crisis yet.
Therefore having the CEO keeping a high degree of centralisation of decisions while expecting decentralisation of operations
Although a bit limiting, the model helps us see where the company stands in its growth and identify the change to be made.
Greiner says "the vestiges of one phase remain as new approaches are introduced"
Seems clear in our case
Weisbord speak about Goal clarity
Kotter about a guiding coalition and develop a vision and strategy
A clear lack of vision was an error in our case - creating that vision would have helped developed the common objective and direction for the change
Criticized for over-simpliying model
Leadership
Need for a clear leadership of change
Weisbord has it in the middle of his framework as a glue to all components
Kotter emphasizes on the need of a good leader to lead the creation of a new system
He emphasizes on the importance of that phase, but the timing can be complicated as we don't really know when that phase is complete
The idea is to convince leaders within the organisation of the necessity of the change
Unfreeze, change, refreeze
Hence the use here of Kotter's model
Linked to power and majority buy in to reduce resistance to change - including empowerment of key actors in the coalition and communication throughout the company.
Kotter's 8 steps model
Lack of leadership in the change process
Coalition not clearly defined, some project based but not in the change process as a whole, some have responsibilities within the change but the no accountability toward the project was created
Absence of a clear vision and even less of communication on the objectives of the change
The need for change and the barriers have not been identified clearly - no sense of urgency
Therefore no common buy-in in the team (management team for that matter)
"Without a sensible vision, a transformation effort can easily dissolve into a list of confusing and incompatible projects that can take the organisation in the wrong direction" Kotter
We can clearly use that model to analyse our case and see why the changes have stalled
Communication from the leadership towards the company, with the aim of on-boarding them all in the change, keeping the big picture alive is essential
Here again we had a lack of communication, with the CEO requesting quick changes without allocating resources in time to the cross-functional team to manage the change process
Need to get rid of past practices and create change: "companies unable to abandon past practices and effect major organizational changes are likely either to fold or to level off in their growth rates." Greiner, 1998
Values and mission for Galbraith
Here again most scholars call for a strong leadership to bring and communicate the vision
Create a sense of urgency, "find ways to communicate this information broadly and dramatically"
Resistance to change
Although the company not that old, the centralised nature of the management created habits in people relying heavily on the CEO creating very little autonomy and initiatives.
But managers, especially middle managers seen as having an increasingly important role in the change process
But are Leaders and Managers necessarily different, especially in small organisations where executives perform the role of middle managers
change would fail should the leader not be able to create and nurture an inspiring vision (Caldwell, 2003 Change leaders and change managers - p286)
Change efforts generally cost a lot more than expected in managerial efforts (Kotter & Schlesinger, 2008)
Contribution of the change agent in creating the resistance (Ford, Ford, D'Amelio, 2008) through inconsistent communication or clear vision, but also "violation of trust", or maintaining resistance as an opposing force
How the lack of coalition and vision, but also the loss of trust by employees create the resistance as the CEO does not fully embrace the change implementation
Necessity to recreate a relationship between the change agent (CEO and other managers involved in the change) and employees
Recreate buy-in in the organisation at all levels through education on the change, early and regular communication - show the leadership involvement and how important the change is, while involving more people in the process
We will explore the theory of Ford, Ford and d'Amelia on resistance to change - 2008
But also use the resistance as a way to empower change recipient and find compromises in the change,
As the CEO and other managers are seen in a position of Power, having them not adhere to processes and procedures undermines the importance of change and therefore the sense of urgency
And be able to propose discussion with change recipients to understand their constraints and resentments and adapt the change process accordingly
But change generally need to happen rapidly and therefore leaders do not always have much time to provide satisfactory negotiation to the recipients
Inconsistency of the message around the change, still doing or praising the old way while expecting the recipient to embrace the new way
Manager will be here to cement the change through the processes and bring the stability back through the refreeze phase
Conclusion
But as changes are necessary and leadership is essential, it is an expense that has to be made
It is essential to diagnose the resistance before starting the change process to be able to overcome it
No diagnosis of the potential resistance to change or its roots
One of the resistance identified by Kotter and Schlesinger is the low tolerance for change, having organisation requiring their employees "to change too much too quickly". (2008 - p 134) making people possibly gain from the change but invariably lose from it
Being supportive with staff is another way brought by Kotter and Schlesinger to reduce resistance - can offer training in new feature being introduced, and feedback session
The nature of the change is not a complex one, and would certainly be easy to explain and educate people on, as well as train them on the fairly easy tools and new systems put in place
Moreover, the type of change that is being implemented here is a process which needs to be embedded in the culture, therefore a negotiation or coercion approaches would not work
In our case, there is contradiction between the approaches we should be using according to Kotter and the pace of the change which need to be fast with very scarce resources
Also the position of the change manager does not give him the power to make changes in a participative approach. K & S recommend that the manager should "increase his power" or find compromises
Cadlwell (2003) emphasizes on the role of leadership to create a vision for change while managers translates the vision into actions