University Management of Change Report: OS Systems Analysis

This report analyzes the management of change at OS Systems, an IT services company, focusing on its acquisition by STAR Systems. The report begins with a case study analysis, examining the company's operational history, financial performance, and the changes required in its micro and macro environments. It explores the reasons for the acquisition, including technological advancements, market share decline, and globalization pressures. The report then applies the Change Kaleidoscope model to identify key change motivators and assesses the upper management's role in driving the change. Further, it evaluates the change management process using the six images framework, identifies resistance to change, and analyzes how the change managers overcame the resistances. The report also assesses the effectiveness of the organizational change using the ADKAR model, evaluating awareness, desire, knowledge, ability, and reinforcement. The report concludes with a reflective account of the change management process, offering insights into the challenges and successes of the acquisition.

Running head: MANAGEMENT OF CHANGE
MANAGEMENT OF CHANGE
Student’s Name
University Name
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Table of Contents
Part 1..........................................................................................................................................3
1.1 Case Study Analysis.........................................................................................................3
1.1.1 Management of Change implementations in OS Systems Private Limited...............3
1.1.2 Changes required in the Micro and Macro environment...........................................5
1.1.3 The reasons for introductions of the change..............................................................6
1.1.4 Economies of Scale....................................................................................................6
Part 2..........................................................................................................................................8
2.1. Application of the Change Kaleidoscope for the identification of the Change
motivators for OS Systems.....................................................................................................8
2.1.1 Time...........................................................................................................................8
2.1.2 Scope..........................................................................................................................8
2.1.3 Preservation...............................................................................................................8
2.1.4 Diversity.....................................................................................................................8
2.1.5 Capability...................................................................................................................9
2.1.6 Capacity.....................................................................................................................9
2.1.7 Readiness...................................................................................................................9
2.1.8 Power.........................................................................................................................9
2.2 Change Requirements of the upper management.............................................................9
2.3 Six Image concept of managing change.........................................................................10
2.4 Identification of the symptoms of Resistance towards change (Active or Passive).......12

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2.5 Application of ADKAR elements for assessing the effectiveness of the organisational
change...................................................................................................................................12
2.5.1 Awareness................................................................................................................13
2.5.2 Desire.......................................................................................................................13
2.5.3 Knowledge...............................................................................................................13
2.5.4 Ability......................................................................................................................14
2.5.5 Reinforcement..........................................................................................................14
3. Reflective Account...............................................................................................................14
Reference List..........................................................................................................................16

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Part 1
1.1 Case Study Analysis
1.1.1 Management of Change implementations in OS Systems Private Limited
OS Pty limited a leading organisation providing services in Information technology.
The company’s founders are Jack Black and D. Govender. Assuming operations since 2000,
the primary objective of the company is achieving long term growth and a stable brand equity
among the local community. The company concentrated upon creating a potential physical
presence in the country in the twentieth century and by means of premium product quality the
innovations the company aimed at creating a strong brand name. However, the failure to
extend the brand name in the international market and the excessive price of the services and
products of the company led the acquisition of the company by STAR systems, the most
potential IT services company in the country in the future and also introduce innovative and
multidimensional product range with focus on the core telecommunications industry.
The company had surpassed its expected revenue collection by 2008, which was an
approximately 292 million Rand (starsystemsservices.com, 2018). However the same
business growth of the company did not sustain and in the end Johannesburg became the
chief operating headquarters. As informed by Jordao, Souza and Avelar (2014), the sales
value started to decline in 2009 and the revenue depleted also to 102 Million Rand. The
innovative and customary products of the organisation were exceeding their budget and thus
became unaffordable for the customers. The situation further worsened when exchange rate
of Rand declined and the revenue collection recorded the lowest. The company recorded a 20
million sales difference with its major competitor in South Africa that is the Star Group.

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Figure 1: Depreciation of Rand against Dollar in 2009
(Source: Maveé, Perrelli & Schimmelpfennig, 2016, p.8)
2000 2002 2004 2006 2008 2009 2010
0
50
100
150
200
250
300
350
151.6
191.9 205.8
258.01
299.99
102
158.4
Turnover '000 million rands
Turnover '000 million rands Linear (Turnover '000 million rands)
Figure2: Turnover graph of the company
(Source: Ćwikła, Sękala & Woźniak, 2014)

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1.1.2 Changes required in the Micro and Macro environment
The founders of the company were aware, that operating in the IT technologies
industry the company had to face the hurdles like need to accommodate to and address the
continuous changes in the active market. The CEO of the company announced in a
conference that OS system needed exposure to foreign markets for its sustained future and
relying on the current fund strength and marketing exposure that was impossible to achieve.
Hence, he declared that the company was selling major shares to the most potential
organisation in the IT industry which is STAR systems. It was projected that the products
would get exposure in international markets as an impact of this acquisition and the use of
developed technology would help to bring down the base manufacturing price of the products
of OS systems which would favour their sales in the domestic market also.
At that moment, the STAR systems, the most prospective organisation in South
Africa, gave the proposition to acquire OS Pty Ltd. The STAR systems believed that the past
organisational structure was an ideal model and believed that they had the capacity to revive
the same culture. The directors presented the proposal of the acquisition to the chief
stakeholders of the company. Several resisting appeals were raised by the valued
stakeholders.

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Fig
ure3: Stakeholders mapping figure (level of interest in the change)
(Source: Created by the Researcher)
The higher management of the company had decided in favour of the acquisition
despite the conflict of mind among the stakeholders. Hence, the upper management needed to
relate the benefits of acquisition to the other employees.
1.1.3 The reasons for introductions of the change
Fore mostly the change was essential for keeping up pace with the technological
revolutions. The necessary revolutions are as follows.
1. Financial Instutions: they are
basically concerned with high
interest returns. hence their
level of interest in the change is
very low.
2. Suppliers: the suppliers do
not have any security of
ongoing service after the
management changed hands.
hence theire level of intetest
over the chamnge is high.
3. Service Provider: The service
providers have a prior
agreement and hemnce are
leats affected by the change.
Their level of interest is
evidently low
4. Middle level Management:
the managerial staff have high
concern for change because
they are the concerned heads
who would prepare the various
departments of th company for
adapting to the change.

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Figure 4: Figure with the technological revolutions
(Source: Created by the Researcher)
1.1.4 Economies of Scale
The projected market plan of the STAR products makes it evident that they would
introduce the products of OS Pty Ltd to newer international markets and make the prices of
the products market competitive. Influenced from the ideas of Resnick et al. (2015), it can be
opined that the change requirements that were essential for the acquisition transition were
chiefly managerial and communicative. Certain stakeholder groups realised through the
conferences that in order to retain the old clientele, competitive pricing is the only alternative
open before the company and the acquisition was the only possible means for achieving that.
The management of STAR systems had promised to retain 80% of the employees of the
manufacturing and marketing sector of the organisation, as per the acquisition contract with
OS systems (starsystemsservices.com, 2018). However, from the perception of the
employees, this mind-set of the upper management can be critiqued. The senior employees of
Technology Revolutions
The need to implement better technology was immense because of the
demand to bring down the prices of the IT services.
Market Share
The local suppliers of blue chips had acquired the market that OS systems had kept in
possession. Hence the acquisition of the company by STAR was essential for enhancing
the shrinked market share.
Globalization
The upper management realised that in order to elevate the sales standard, it is essential to capture
international markets. Hence, eviently, the acquisition could have facilitated the company by taking the
products at a global level.
Synergy Creation
The busines management committee of STAR systems realised that the acquistion
could help in the creation of better share value for the both of the companies. As
per Maveé, Perrelli and Schimmelpfennig (2016), this is beneficial for sustained
busines growth.

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the company could have accomplished the survey of market demographics and analysed the
pro-forma performance gap of the company for the upcoming five years. This could have
helped them in preventing the acquisition. About 350 employees with revenue about 1.2
million had decided against the acquisition. The upper management did not consider the
employee support that would have received if they had decided against this acquisition. The
upper management could also have made competitive strategic run in the new markets to
analyse the new prospects, rather than relying entirely on the acquiring company to conduct
survey and determine their market value.
As an outcome of this acquisition, the STAR productions purchased the brand against
1.9 Billion by the end of 2015. The CEO of OS operations projected the mission of
introducing not only competency or exposure, but transforming the business outlook
completely.
Questions
1. Discuss the causative agents of this acquisition with Change Kaleidoscope model. Evaluate
why the upper management needed to manifest this change?
2. Evaluate the process of change management using the six images framework.
3. Certain stakeholders were unready to accept the change. Identify the major resistances to
change and identify how the change managers overcame the resistances
4. Determine if the change was successfully implemented after the acquisition of OS systems
with the help of ADKAR model of management.

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Part 2
2.1. Application of the Change Kaleidoscope for the identification of the Change
motivators for OS Systems
Eight factors play the key role in identification of the key change motivators for an
organisation and they are:
2.1.1 Time
So far as the higher management of OS systems are concerned, they were always in
the hunt for an appropriate opportunity to sanction the deal for an acquisition. They supposed
that it was the only mean to reach the bigger customer bases. The company’s production
would have been hampered if the revenue generation did not leap up by 15% in the coming 5
business years. On the other hand, STAR systems offered a 25% business hike by 3 years of
acquisition and also referred that they would pay the market compensation for the losses
incurred in the last 2 business years to the stakeholders. As per Jordao, Souza and Avelar
(2014), the higher management has a key role in deciding the fate of future operations of a
company.
2.1.2 Scope
OS systems management also saw that with a viable acquiring company, their product
sale would get a new boost by the dint of the best of class technology and sufficient market
capital.
2.1.3 Preservation
After taking up OS systems, the shareholders from STAR systems decided to keep the
core management of the organisation intact in order to sustain the intelligence base of the

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organisation. The marketers of the STAR systems also planned to utilise the customer
retention strategy of the company.
2.1.4 Diversity
After the acquisition of the company, the confluence of culture laid down sufficient
opportunity for diversity. The employees of the two companies also shared their business
values and strategies as a part of diversified collateral. According to the contractual terms of
the acquisition, two-third of the employee base of OS systems would have been retained after
the acquisition also.
2.1.5 Capability
Since both organisations are exponents of the IT industry, their capabilities are
similar. The main challenge in this context is the integration of the vision and working culture
in the STAR systems.
2.1.6 Capacity
The SAR systems have sufficient expertise and market strength and volume for
managing the transitional period of the merger of the two companies. The past experience of
acquiring small IT companies would help STAR systems to ease out the business operations
in collaboration with the members of STAR systems.
2.1.7 Readiness
Mixed culture and buffered business relationship aroused the fear of losing contracts
in the minds of the suppliers of OS systems. It is obvious that STAR systems would favour
their own suppliers over others.
2.1.8 Power

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Both the organisations believe in their human resources. The leadership quality and
communication skill of both companies are equally strong. Hence, it would be easier to
address pertinent issues and make in-depth analysis of the problems for achieving their
missions. Furthermore, both the management shares the same belief that maintaining a well
engaged and happy workforce directly impact the performance of the company. The lack of
an initial capital of 3.5 million were supposed to be compensated by the management of
STAR systems after the acquisition. In fact Pickering (2017), also professes that employee
management is a crucial factor behind success in business. In absence of that the upcoming 3
company projects of OS (now acquired by STAR) amounting to contract value of 0.8 million
would go into doldrums.
2.2 Change Requirements of the upper management
The upper management of OS systems had introduced innovative technologies and
stressed more on product quality than market competitiveness. Hence the customer market
started to act impulsively, when the company failed to make the prices of the products
competitive. The main mission of the upper management of OS systems was to expand the
company’s products in bigger international markets and set up strategic collaboration in
bigger countries with the local manufacturers and thus enlarge their customer base in foreign
countries. This would help in greater revenue collection and thus they would be able to make
more liquid investment in the domestic market. They planned to strengthen their R&D by
thus strategy and thus in turn reduce the prices of the products. The upper management
required the help of a bigger and more professional and widespread management that could
help them to achieve their targets. However, in order to enter new and potential markets,
which could offer them a stable market and favourable socio-political background for the
spread of business, they needed a bigger brand name. This is why they considered the
acquisition with all importance.