Change Management in a Multinational Inspection and Certification Institution
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This paper analyzes the corporate culture, management style, employees' expectations of the company's future, leadership, and change agent of both companies to give reasonable suggestions for change management in a multinational inspection and certification institution.
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Change management Introduction At present, the company I work for is a multinational inspection and certification institution, which mainly serves the consulting of China's import and export trade, inspection and testing of ports, food and milk powder, and so on. The company was established in 1980 and has more than 40 years (Atkin and Brooks, 2021). There are more than 40 companies in China, having more than 300 branches and offices worldwide, the total number of employees is 25,000. In the EU region, we have six units of companies, and the central business is government authorized business, such as inspecting the second-hand machine and recycling raw materials. Compared with the other international inspection companies and the competitors in the same industry, such as SGS, BV, Intertek, our market share of port inspection in the European market is minimal. Many factors restrict and affect the company's growth, such as lack of core competitiveness, single corporate culture, bureaucracy management, etc. At the start of 2018, our main business started to decrease, andthecompanyrealizedtheimpactofadeclineinrevenue.Therefore,thecompany's management wanted to transform the company by developing diversified businesses. One of the transformations was to make up for our shortcomings by acquiring local companies to improve our competitiveness and add more fresh blood. Since CCIC is a traditional Chinese company, manage a foreign company with all local employees. It will be a big challenge for CCIC to integrate the new company's employees into the corporate culture of CCIC. Although, there are no significant complaints from the acquired company's employees to CCIC.This paperwill analyze the corporate culture, management style, employees' expectations of the company's future, leadership, and change agent of both companies to give reasonable suggestions. Analysis Culture As I mentioned before, the acquired company (B&J) and CCIC have different corporate cultures and management styles. The cultural webwillanalyze the two companies' cultures before the acquisition. The cultural web approach is excellent management and organizational tool for assessing your company culture's strategic direction (Hoyas, J. 2022, February 9). CCICB&J StoriesGood brand reputation Good service network in the world Good quality for service Good inspection network in EU
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Always passion with your work SymbolsOfficesize:ownbuildingwith company's logo Dress code: Business and casual More formal interaction Company logo design is blue and whtie Dress code: Casual Office size: Rent a small office Employee always out of the office Power Structures Hierarchy and BureaucraticNo Hierarchy and Bureaucratic More Democracy Organizational Structures A complex mix of department The GM is most powerful in the local company, but we also have a supervision department in China Only one department Partnership for two people Control Systems A lot of policies and procedures Financial control and monitoring by head office Own OA system Auditbytheheadofficeevery yearanddifferentassociations (such as FOSFA, Gafta) Simple procedures and policies Email contact with a client Auditbydifferent association(FOSFA,Gafta( Nointernalsystem.Everything contraction is by email and Tel Rituals & Routines Each employee who has worked for the company for five years will get a gift. Monthly meeting Companyprovidelunchtoan employee,andeveryyearhave team building end of year A lot of lengthy meeting No one working after 17:00 Celebrate the birthday people per month Working 24/7 No lengthy meeting No big party end of year Friday lunch for free In summary, we can see that there are differences between the two companies in many aspects, suchasinPowerStructures,Organizational Structures, Control Systems,whicharemore pronounced, mainly because CCIC is a multinational enterprise (Smimou, 2020). At the same time, B&J is a business that serves the local area. The growth background of both companies is also different. In addition, from the diagram, some of the things that cannot be presented are the reporting and communication between lower and higher levels. CCIC lower-level staff can only give feedback and report to the central leadership, and then the middle leadership conveys to the top. While B&J, because of its simple organizational structure, the inspector can report directly to its general manager. Both CCIC and B&J have their strengths and weaknesses, and it would be beneficial to each if they could be perfectly integrated (Hai, Hai, and Tien, 2018). Communication Although the company has a clear vision of the strategy and operation, the final implementation is not as efficient as expected. However, B&J is now a part of CCIC and accepts CCIC's unified management system and ideology. Though, because of the different environments that both
employees grew up in, there are some problems in the communication efficiency between the two sides(McCreadie, 2017). For example, first of all, we need to translate CCIC's management system documents into the local language, and at the same time, arrange for B&J's staff to learn and train, which will take nearly half a year or more to get the initial effect. Leadership Before the acquisition of B&J, there were many disputes between the company's management. The purchase was halted for a while because CCIC's headquarters had too strict rules about the acquired company's future earnings (Trong Tuan, 2017). However, due to Mr. Fan's efforts to lobby the group's senior management and insist on his personal judgment's correctness, the acquisitionwasfinallysuccessful.Agoodleaderneedstohavevision,inspiration,and momentum; Mr. Fan has a clear vision and insight into the company's future direction and influences his colleagues through his ability and charismatocreate more value for the company. As he has worked in the front line of the inspection industry for many years, he will provide professional training to new employees as his time allows. But for the newly acquired B&J, this management style will not be very effective. First of all, since Mr. Fan does not speak English or the local language, communication will be the first obstaclesince all of B&J's employees are local. His ideas could only be conveyed to B&J management through translation, but his leadership could not influence the rest of the B&J staff. The new company employees were also unable to communicate their ideas to the administration, which would have created a disconnect between the employees and the leadership in the long run. AlthoughB&J employees do their jobs every day,the company leaders do not know what they think about the company. Therefore, the new management needed to find ways and means to listen to the employees and think about integrating the two completely different corporate cultures to achievea good result (Ilyas, Abid, and Ashfaq, 2020). CCIC's current leadership is all from China, and the average age is over 55. It is not a good cycle for the company's future development and needs to cultivate young people with a thorough understanding of Eastern and Western cultures (Ellis, 2021). Change Agent Although CCIC has acquired B&J, it is still in the early stages of reform and transformation, and there are still many variables that affect the efficiency of future changes. Because the change agent is leadership-driven, power, capability, time, preservation, and scope will proceed smoothly (Kundinger, 2020). However, readiness for change diversity will likely affect the efficiency of change. I will then elaborate on each of these: Time Time is not a significant threat to the changeinthe change agent. The CCIC Group's headquarters conducts an annual review of newly acquired companies.If, within two years, the company does
not meet the group assessment criteria. The company will be re-evaluated and analyzed to determine why it does not meet the assessment criteria. Therefore, theoretically, it is possible to complete the achieve change within the time limit set by the group. Scope As the acquisition took place in the Netherlands, the acquirer is CCIC Europe, the change agent. The investment will keep all employees of B&J in their positions, including their management. However, CCIC, as the significant controlling shareholder, will place its employees in the managementteamtocarryoutregulatorycontrolandcommunicateCCIC'smanagement philosophy and culture. For CCIC, there is no change in terms of organization. But for B&J, there is a significant change in the organization. From the perspective of breadth and depth, CCIC is only involved in the management but not in the overall organizationadjustment, so breadthis more considerable thandepth. Preservation CCIC will retain B&J's staff, testing equipment, and client resources. B&J's employees will continue to work in their current positions and maintain their current benefits. In addition, B&J will support its operations because of its existing customer base. In addition, CCIC will share its client resources with B&J to help expand its business and increase revenue in the future. At the same time, B&J's employees will share their work experience and help CCIC train new inspectors. This will exchange resources and help both companies improve their overall competitiveness. In addition, CCIC itself has a complex hierarchy and bureaucratic management style. These may affect the change agent's promotion efficiency in the change. However, suppose the prominent leader of the change agent has a subjective sense of advancement and is very strict in managing advancement details. In that case, these will not be taken into account. Diversity Diversity is one of the hindering variables in the change because B&J has just been merged into CCIC. There are significant differences in the corporate culture and management model of both sizes. Therefore, it will take a long timein the running-in period. However, there are many unpredictablerisksduringtherunning-inperiod,suchasconflictsbetweenemployees, competition management and performance evaluation between middle managers, and lack of understanding of CCIC's strategic direction. CCIC decided to listen more to B&J's employees' expectations after the merger and based on the employees' research requests to overcome these difficulties. So their loyalty to the company will be enhanced. It will be regarded as one of the future transformation goals to demonstrate CCIC's inclusiveness. Capability and Capacity Capacity and capability assess the company's planned change. Power is linked to cash, time, people, organizational structure, and management abilities. There are three main factors regarding capacity, namely time, people, and cash, all three of which can be accomplished for CCIC. Because the change agent is top-down, the company will arrange a person to follow up the management and operation of the company after the merger. If problems arise, there will be someone to coordinate the friction between the two sides. It takes time to verify the change results, and the change agent will not set particularly stringent assessment evaluation indicators for the post-merger performance evaluation.Therefore, the time is relatively generous. The acquisition is an all-cash deal, and B&J's management is offered shares as an incentive to stay on. Regarding capability, this is CCIC's first overseas acquisition. So, in the process of M&A, we are guided by an external professional consulting firm. However, CCIC will take the lead in the subsequent management. Readiness In the process of change, readiness is another obstacle. Because not everyone is willing to accept change, not everyone needs and wants to change from the employee's point of view; they are used to the usual workload and environment. For example, as I mentioned before, CCIC's existing
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inspectors cannot keep up with the speed of its business development, and some inspectors are unable to complete the tasks assigned by the company. Therefore, if changecomes, these employees will be the first to oppose and be slack in work, which will affect the overall working atmosphere of the company. In addition, although the company's management is a change agent, there are still many middle managers who have been working at CCIC for many years and have the average working ability. Still, according to the company's regulations, they can be promoted as long as they have worked for a certain number of years and completed the assessment index of the position. Now suddenly there are newstaff and employees with good working ability, which will threaten their future promotion process andaffect the speed of change. Power The purpose ofCCIC acquiringnew companiesisto fill the company's shortcomings in terms of business development, thus increasing the company's competitiveness and gaining more market share in the industry.Replenishing the company with new blood is an essential part of being a healthy company. CCIC has a division of the head office and regional management; according to the group rules, acquisitions of less than 2 million euros do not need to be reported to the group headquarters; the regional companies can decide independently. The addition takes place in the European region so that the European regional company will be the primary representative of the change agent for the top-down change process. The European regional company has absolute management power over B&J. It has complete autonomy, the capacity of execution, and voice capacity in setting its assessment index, management style, incentive policy, and helping new and old employees integrate into the company culture. Conclusion To sum up,bycomparing thetwocompanies'culture, working methods, and management mode, it is evident that there are significant differences. These differences are mainlybecause the employees and management of the two companies have different backgrounds in terms ofgrowing upand life, company size, mindset, and strategic direction, which are highly correlated with. It is a big test for B&J employees to accept the association of a completely new company. In the change process, some employees may not be able to stand the test and leave, while others will accept and understand CCIC's management model and corporate culture and choose to stay, which will be verified through more time in the future. Regarding communication and leadership, these are short-term problems,andthey can be solved, but it will take a little more time to reach the expectations of CCIC and B&J. In addition, CCIC hopes to fill the shortcomings of its business by acquiring B&J to improve its competitiveness and gain a larger market share in the industry. Through the change Kaleidoscope analysis, we can see that CCIC's commitment to change is top- down, throwinginto considerable human and financial resources and sufficient time to verify the change results. Although there are some obstacles in the change process, such as readiness and diversity, they will be further solved under the change agent-led promotion. Recommendation Based on the previous analysis, it is evident that the biggest problem is the compatibility between the two companies after the integration. There are many differences between the two companies regarding company culture and management style. Secondly, there is the problem of leadership and communication. Finally, the progress is driven by the change agent. The following will give the corresponding recommendation one by one: 1.Socialization Training,developing,andmentoring-Throughtraining,B&Jemployees,understandthe background of CCIC, the vision and strategic objectives of the group, and learn the history of CCIC at the bottom. It can be observed whether they can integrate and recognize CCIC's corporate culture. Rites - From the previous analysis, we find that B&J employees lack traditions in their work, such as promotions, employee awards, team building, and employee anniversaries. CCIC and B&J's HR department can make a combined program for this purpose and create specific incentives for each employee's birthday, anniversary, etc., in the future. It will make them feel that the company
cares for them and recognizes their existence. Top management action - CCIC top management needs to take the initiative to spend more time to understand the local culture and the origin of the employees' customs and habits. Try to understand the way of thinking and getting along with the employees. At the same time, the interaction between CCIC and B&J employees should be increased through various team building to understand and identify with CCIC's corporate culture and help them break the boundary of different cultures. 2.Five behaviors of a cohesive team It is difficult to get two teams that are strangers to each other to work together and create chemistry. Still, it is crucial to get both teams to be honest and build trust in each other through the appropriate internal and working interactions. There may be conflict in the process, but it is also a bond that sublimates the relationship between the two sides. Through difficulties together, they can trust each other more. Having gone through trials and tribulations together, they will continue to move forward and take responsibility for the company's goals in the future. Let the employees of both sides have their sense of responsibility for their work and work together fighting for the company's future in the end. 3.Leadership To develop and open up a training program for the development of young executives and to recruit local employees who recognize and understand CCIC's culture and management philosophy. 4.Change agent For the CCIC-led change agent, there is some resistance. But it can be digested by CCIC internally; for example, for those employees who are unable to perform their positions, they can receive a series of training programs, and if they are still unable to meet the company's requirements after the training program, they can be negotiated to exit interview by paying a certain fee. Some employees who are not ready to meet the change can be appropriately trained to understand why the company needs to change. Reference: Hoyas, J. (2022, February 9).Cultural Web Model: What Is It & How Can Use It? Factorial Blog. https://factorialhr.co.uk/blog/cultural-web/ Ellis, P., 2021.Leadership, management and team working in nursing. Sage. Ouedraogo, N., Zaitouni, M. and Ouakouak, M.L., 2021. Leadership credibility andchangesuccess:mediatingroleofcommitmenttochange. International Journal of Productivity and Performance Management. Smimou,K.,2020.Corporateculture,ethicalstimulus,andmanagerial momentum:Theoryandevidence.BusinessEthics:AEuropean Review,29(2), pp.360-387. Hai, D.H., Hai, N.M. and Tien, N.V., 2018, January. The influence of corporate cultureonemployeecommitment.InInternationalEconometric Conference of Vietnam(pp. 450-465). Springer, Cham. Paro,P.E.P.andGerolamo,M.C.,2017.Organizationalcultureforlean programs.Journal of Organizational Change Management. Walden, J., Jung, E.H. and Westerman, C.Y., 2017. Employee communication, jobengagement,andorganizationalcommitment:Astudyof membersoftheMillennialGeneration.JournalofPublicRelations Research,29(2-3), pp.73-89. McCreadie,C.B.M.,2017.Communication,information,andsurveillance: Separation and control in organizations.Between Communication and Information.
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