Organizational Change at Lakeland Wonders

This paper studies the organizational change at Lakeland Wonders, a firm in Minnesota that deals in wooden toys. The report presents the causes of failure as far as the organizational change is concerned, and also certain recommendations which can enhance change management within Lakeland Wonders.

Running head: ORGANIZATIONAL CHANGE AT LAKELAND WONDERS
Organizational change at Lakeland Wonders
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1ORGANIZATIONAL CHANGE AT LAKELAND WONDERS
Executive summary
The aim of this paper is to study the organizational change at Lakeland Wonders, a firm in
Minnesota that deals in wooden toys. After the new Chief Executive Officer, Cheryl
Hailstorm, was appointed by the company, she attempted to implement some new strategies
in the organization, which included offshore manufacturing. However, she failed to take into
account all the aspects of offshore manufacturing, as has been discussed in the paper below.
The report presents the causes of failure as far as the organizational change is concerned, and
also certain recommendations which can enhance change management within Lakeland
Wonders.

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Table of Contents
Introduction:...............................................................................................................................3
Discussion:.................................................................................................................................3
An overview of the scenario..................................................................................................3
Analysis of the change implemented.....................................................................................4
The repercussions that followed.............................................................................................5
Recommendations to the CEO regarding change management.............................................5
Conclusion:................................................................................................................................6
References:.................................................................................................................................7

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Introduction:
The purpose of every organization is to implement a management strategy that would
be aligned with the company’s strengths, capability and competitiveness. As a matter of fact,
any organization should be open to the idea of change which might be needed so as to
enhance the productivity of the organization, make it sustainable and to help it adapt to latest
trends and technological developments (Benn, Edwards & Williams, 2014). Various changes
in the internal and external environment of an organization would require effective change
management (Cameron & Green, 2015). In order to study the various aspects of
organizational change and change management, this paper takes into account the case of
Lakeland Wonders, which is located in Minnesota. Whenever some change is implemented in
an organization, it is bound to have repercussions, which may or may not be anticipated.
Some of these changes might be welcomed, while some would be ignored by all those
involved in the process. However, the way the change process is executed plays a crucial role
in determining its success or failure.
Discussion:
An overview of the scenario
Lakeland Wonders is a company based in Minnesota which manufactures top quality
wooden toys. The company has factories all over Minnesota with more than five thousand
people employed under the banner. The company, which was previously owned by the
Swensen family in Minnesota, recently decided to hire a new Chief Executive Officer outside
the family, in order to bring in change. Cheryl Hailstorm was appointed as the new CEO; this
step was taken because according to the preceding CEO, Wally Swensen, Cheryl knew how
to optimize profit outcome and had the enthusiasm and energy which would be required to
lead the company towards success. Moreover, she had previously worked as the Chief
Operating Officer in another reputed company in the same field and had been associated with
Lakeland Wonders before. After Cheryl’s appointment, she implemented some radical
changes in the workplace in order to dramatically improve revenue generation. The change
process emphasized on the need for offshore manufacturing with the purpose of reducing
manufacture and production costs and increasing profits. Before the project was
implemented, Hailstorm ensured that extensive evaluation was carried out on the facilities

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available, labor management and manufacturing capabilities. However, some aspects of
change management, like the pace of the change process, the way it was implemented,
tackling resistance, acceptance of change in leadership, change in organizational culture,
reforms in company practice and norms, were not taken into account and handled effectively
(Cummings & Worley, 2014).
Analysis of the change implemented
The changes implemented were as follows:
 Cheryl Hailstorm wanted to alter the way facilities were managed in the company; she
also introduced a number of changes in the maintenance and manufacture processes
and in human resources.
 She knew that the market for non-electronic toys were mostly occupied by large
global chains, including their competitor, Bull’s Eye; thus, she decided to introduce a
new line of products which had comparatively lower prices and a definite USP
(unique selling proposition) that distinguished Lakeland Wonders from other
companies. For example, she wanted to highlight the fact that the products were
manufactured in the United States in the product and the packaging.
 Also, she decided to incorporate offshore manufacture since it was assumed that it
would reduce manufacturing costs. Cheryl was of the opinion that the only way of
tapping the midmarket and upscale market was through offshore manufacturing,
which had been previously postponed by the preceding management.
The repercussions that followed
However, Cheryl had failed to take into account the organizational culture of the
company. She had little to no idea about the history and used a coercive and autocratic style
of leadership while dealing with the employees of the company. Consequently, she lost the
trust and goodwill of her people who refused to cooperate with her during the change process
(Matos Marques Simoes & Esposito, 2014). Most importantly, Cheryl completely ignored the
implications of her change process on human resources; offshore manufacturing or
outsourcing the manufacturing process would mean loss of jobs; out of 5000 people working
in the factories, more than two thousand people were terminated, thus adversely affecting the
company’s overall image. Moreover, the main reason why the company had previously
decided to postpone offshore manufacturing was because there was no research into the

5ORGANIZATIONAL CHANGE AT LAKELAND WONDERS
services available in other countries and without a base to support the change, the method of
execution was sure to fail.
Recommendations to the CEO regarding change management
 The purpose of introducing change in Lakeland Wonders is to ensure that the
management is optimizing its use of resources and is able to meet the needs of the
customers. Thus effective change management would be required to manage
manpower, to implement new management strategies and to evaluate productivity and
performance of labor (Hayes, 2018).
 To carry out offshore manufacturing, there has to be emphasis given on planning; it is
also important to carry out research on the risks associated with business offshore and
efforts must be made to improve operations (Ellram, Tate & Petersen, 2013).
Operational planning of such offshore manufacturing would include aspects like
equipment costs, product demands and standard costs. Total Quality Management or
TQM is a model that can be used during the organizing and planning process of
change (Gharakhani et al., 2013).
 Resource allocation would also be recommended to Cheryl Hailstorm; this would
mean that the precious available resources of the company would have to be aligned
with the goals, mission and the overall business strategy (Hashim, 2013). In offshore
manufacturing, budget and resource allocation would play a crucial role in increasing
efficiency of operations.
Conclusion:
To conclude, it can be said that Lakeland Wonders would have benefitted from the
change process implementing offshore manufacture only if the new CEO, Cheryl Hailstorm,
had taken adequate measures to support the change process. However, she worked in haste
and tried to implement the change without thinking about the risks involved or the
repercussions, which eventually caused the plan to fail. Moreover, she turned her people
against her, and lost their cooperation in the crucial planning stage of the change process.
Nevertheless, a few recommendations have also been made which can be kept in mind while
implementing other changes in the organization in the future.

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References:
Benn, S., Edwards, M., & Williams, T. (2014). Organizational change for corporate
sustainability. Routledge.
Cameron, E., & Green, M. (2015). Making sense of change management: A complete guide to
the models, tools and techniques of organizational change. Kogan Page Publishers.
Cummings, T. G., & Worley, C. G. (2014). Organization development and change. Cengage
learning.
Ellram, L. M., Tate, W. L., & Petersen, K. J. (2013). Offshoring and reshoring: an update on
the manufacturing location decision. Journal of Supply Chain Management, 49(2),
14-22.
Gharakhani, D., Rahmati, H., Farrokhi, M. R., & Farahmandian, A. (2013). Total quality
management and organizational performance. American Journal of Industrial
Engineering, 1(3), 46-50.
Hashim, M. (2013). Change management. International Journal of Academic Research in
Business and Social Sciences, 3(7), 685.
Hayes, J. (2018). The theory and practice of change management.
Matos Marques Simoes, P., & Esposito, M. (2014). Improving change management: How
communication nature influences resistance to change. Journal of Management
Development, 33(4), 324-341.