Organizational Change Management: Importance of Communication and Leadership Style

The report evaluates the leadership and communication style of the CEO in light of the culture and the values of the company. The report is further aimed at analysing the way in which the change was communicated by Cheryl Hailstorm in the organisation Lakeland Wonders, evaluating it in the light of the various change management theories and making recommendations for improvement of the same.

04 September 2018
Organizational Change Management

ORGANIZATIONAL CHANGE MANAGEMENT 1
Executive Summary
With the increasing global competition and the complex business practices, the
changes in the business world are inevitable. The organisations must adapt to its changing
environment to sustain in the long term. The role of the top management of the entities is
empirical in allowing and managing the changes in the organisations. It is the responsibility
of the management to understand the culture of the company and the attitude of the
individuals in order to manage the changes successfully. The same cannot be done without
effectively communicating with the managers and the employees. The report highlights the
importee of the communication and the ways in which it should be used by the managers to
manage the changes in the organisations.

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Table of Contents
1. Introduction.........................................................................................................................3
2. Background.........................................................................................................................3
3. The role of communication in Change Management..........................................................4
4. Leadership style of Cheryl Hailstorm.................................................................................4
5. Gaps in communication of Cheryl Hailstorm.....................................................................5
6. Principles of change............................................................................................................6
7. Recommendations for improvement in the communication of change..............................7
8. Conclusion..........................................................................................................................8
9. References...........................................................................................................................9

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1. Introduction
With the emergence of the new technological advancements, business practices,
changes in the preferences of the customers and policies of the regulators, global competition,
and other environmental factors; comes the need and opportunities for the change in the
organisations. Moreover, it is crucial for the organisations to accept and manage the changes
in an effective manner, or else the organisations would perish (Alvesson & Sveningsson,
2015). The changes in an organisation can take place in various forms and manners, such as
migration of various resources, business processes, budget, and sometimes employees as
well. However, the change initiatives in an organisations are not always welcomed. As
mentioned above, the changes have a direct impact not only on the operations of an
organisation, but on employees too. Thus, it is essential for the management to convey the
changes to the members of the in a relevant manner, to implement the same in the
organisation successfully.
The report evaluates the leadership and communication style of the CEO in light of
the culture and the values of the company. The report is further aimed at analysing the way in
which the change was communicated by Cheryl Hailstorm in the organisation Lakeland
Wonders, evaluating it in the light of the various change management theories and making
recommendations for improvement of the same. The report concludes that communication is
an essential component of the various stages of the change management at organisations and
the same should not be overlooked by the managers.
2. Background
Ms Cheryl Hailstrom is the CEO of Lakeland Wonders, which is engaged in the
manufacturing of high-quality wooden toys. She is the first CEO to be from outside the
Swensen family, who will be holding such a prestigious position in the company. Thus, the
fact that she is not much aware of the company and the culture is evident. The reason for her
to be chosen at the said position is her working style and the personality. The stakeholders
believed that she would channelize the same energy and enthusiasm shepossess, in the
company Lakeland Wonders too. As a CEO of the company, she is trying to lead by example
and some of her noteworthy activities were, travelling to visit customers in midst of the tight
schedules, setting aggressive deadlines for new projects, and proposal of a new bonus scheme
to the union for improving the cycle times.

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Being the CEO of the company, she visualizes a growth plan for the company in the mid
market; however, as she discusses the same with the other senior managers and the
departmental heads, the people seem to resist the change. Her growth strategies can no doubt
benefit the company in terms of the market capturing and the revenues; however, the same
are not going well with the internal well being and the operational structure of the entity.
. The report critically analyses the underlying causes of the unsupportive behaviour from
the managers and the communication and leadership style of Cheryl Hailstorm in the next
segment.
3. The role of communication in Change Management
Regardless of the change strategy devised by the top management of an entity, the goal is
the same. The major goal of a change manager is to determine the thought process of the
individuals, rules of engagement of working together and articulating the same in the
processes, to achieve the desired change (Hayes, 2018). It is important for the top
management of the company to understand the importance of change communication the
same way, it is considered in the other management fields. As the communication is a two
way process, the stakeholders of the organisation form an important loop of the change
operations in an entity, and the same must be informed and engaged to bring about the
change successfully (Doppelt, 2017). It has been pointed out in various researches that
communication of the desired changes at the preliminary stage impacts the further course of
action in the minimal ways (Hughes & Wearing, 2016).
In order to successfully implement a change strategy, the communication must involve
the following elements. Firstly, the message must be sent to the employees in a clear manner.
The vision, strategy and the consequences must be genuinely presented to the employees as
well as to the stakeholders. The recipients of the message must be encouraged to ask
questions for clarifications and to suggest feedback for the same. The timing and the method
of communication must be compatible with the respective circumstances of the management
and the stakeholders. The message must be conveyed in a way that connects with the belief
and thoughts of the stakeholders and the overall vision of the management of the company to
achieve the goals and objectives of the organisation.

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4. Leadership style of Cheryl Hailstorm
As a CEO of the company Lakeland Wonders, Cheryl Hailstorm is concerned with the
growth targets that seem to be achievable as per the company’s capabilities. She analyses the
market situation as the Bull's-Eye Stores is looking for an exclusive line of wooden toys.
According to her, the company can meet Bull's-Eye Stores pricing requirements, by
establishing manufacturing capabilities at an offshore site, i.e. outside the USA. She feels the
company has a plenty of time to ship for the upcoming Holiday season. Being a successful
leader in the past, she recognised the importance of tapping the growth opportunities in order
to sustain in long run and gain the competitive advantage.
However, as evident, she has been opposed by the top managers of the company. The
company Lakeland Wonders is a 94 year old company. The same has been run by the family
members till the appointment of Cheryl Hailstorm as the new CEO. The strong leadership as
rendered by the family members of the company has inculcate the values of ownership,
loyalty, trust and a culture of long lasting stability in the company.
The leadership style of Cheryl Hailstorm has earned her praise in past. However, the
managers must evolve their style and strategies of leading depending upon the culture of a
particular enterprise. As a result the working style of Cheryl Hailstorm does not go well with
the culture of the Lakeland Wonders unlike the Kids & Company in past.
While the managers of the entity are habitual of the stable work culture, the CEO is
inclined towards taking risks on the lines of the technological innovations in order to succeed.
The mangers fear that the off shore unit will hamper with the sentiments of the consumers
and the same may not be beneficial for the brand name at has been earned over the years. The
managers also fear and are unsure of the new contractual agreements with the new parties and
the trade negotiations with the union. According to them, the negotiation with the union is
tricky and might result in slowdown or the strike of the work force and might prove to be
disastrous for the operations of the company and the goodwill. Thus, there is a wide gap
between the personalities of the CEO and her immediate subordinates.
Another major area of the gap which is causing a significance resistance is the discipline
of loyalty. Loyalty of the employees has become a force of opposition. The managers are not
willing to disturb the existing relationships.

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Thus, there lie a major gap between the culture of the company, the attitude of the
employees and the leadership style of the CEO.
5. Gaps in communication of Cheryl Hailstorm
According to the transactional analysis (TA) developed by Eric Berne (1964),
communication is regarded as a set of transactions (de Graaf & Rosseau, 2015). As stated by
Eric Berne, in a TA, the persons present in the communication channel tend to develop a
pattern of transactions. Berne, also prescribed the four basic life positions while evaluating the
communication in change management. These positions are as follows.
 Both the parties are OK
 First party is OK, second party is not OK
 Second party is OK, First party is not OK; and
 Both the parties are not OK
On analysis of the case study, it is found that as the CEO is OK, but the managers are
resisting, the issue faced by the company belongs to the second life position. According to
Berne, though the second position looks like a winning position, but it actually leads to the
occurrence of the negative strokes and patterns.
CEO failed to develop a common vision towards the entity’s future and was focussed on
getting her narratives right. She had failed to understand that every individual goes through
his or her own personal narratives. The sudden announcements and changes may interfere
with the ongoing personal narratives and thus might lead to negativity (Olins, 2017).
Another major gap that has been evident from the case study is that there is a lack of
acceptance of feedback and the communication from CEO towards her seniors. She fails to
acknowledge the insights given by Mark about the culture of the company, especially when
she has worked with him in the past. Cheryl fails to further communicate her understanding
of the goals and the future course of action with her employers i.e. Wally Swensen and other
stakeholders.
In addition to this, she fails to communicate with the current team and thus, the lack of
the relationship is clearly evident. As her relationship with the company has changed, she
should have been communicating in her new capacity to understand the people and the
framework of the operations better.
Thus, the CEO’s communication style seems to be aggressive as she is more concerned
about sharing her vision and plans, instead of understanding from the point of view of the
stakeholders.

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6. Principles of change
According to the Kurt Lewin's model of change, that involves three stages of the change
management namely unfreeze, change, refreeze; a change manager must analyse, intervene
and communicate in way that is productive (Hayes, 2018). There have been prescribed four
practices to bring about and communicate the change. These are directing, coaching,
stimulating and enabling.
According to the first practice, the managers of the entity must communicate to enhance
the confidence of the employees, to bring about coordination and to resolve the conflicts
(Bolman & Deal, 2017). The second practice, i.e. coaching involves a number of tasks such
as instruct, demonstrate and guide in order to get the managers and the employees understand
the elements of the change. The third practice of stimulating deals with the communication
to motivate and encourage the people on whom the changes would have the direct impact.
The last practice is about allowing the people of the organisation to adjust with the changes.
7. Recommendations for improvement in the communication of
change
According to the enquiry action framework, and by application of the principles of
change as listed above, the CEO of the company Lakeland Wonders have been recommended
to take the following course of action for the successful implementation of the change.
 The CEO must work towards understanding the culture of the enterprise before
simply devising the strategy for the change (Binder, 2016). As the managers and the
employees are habitual and bound by the cultural values of the company, the CEO can
gain an insight about the mindsets by stories and narratives, employee socialization
and sharing of the rituals. This will enable the CEO to build a reputation for herself
and gain the trust of the stakeholders and the staff. The CEO must first diagnose the
cultural values of the entity to gain clarity and and then introduce new cultural
elements.
 The CEO is further recommended to slow down her pace of leadership style to match
the same with the attitudes of the company members. In order to enact the change, the
modifications to the organisational structure can be done (Rosenbaum, More &
Steane, 2018). However, the same must be communicated to the seniors first. The
CEO is suggested not only to discuss the plan with her manufacturing manager, but

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she must also into account her suggestions and feedback. This is because, every
company is different. The same leadership and communication style is not applicable
globally.
 The CEO is recommended to focus on team building and dynamic communication.
This can be done by appreciating the managers for their respective concerns according
the proposed plan for change (Jones & George, 2016). The second way is to involve
the experienced managers and the staff members who have crucial insights into
operations of the company Georgalis, et al., 2015).
 The strategy for the change must be crafted taking into account the needs and
aspirations of all the stakeholders (Carnall, 2018). A stakeholder analysis must be
conducted, to increase the collaboration. The same must be explained and
communicated to everyone in the organisation. The feedbacks must be incorporated
before the final blue print of the strategy is devised.
 The change must be implemented by leading and motivating the employees (Kiitam,
McLay & Pilli, 2016). The problems must be solved through group discussions,
meetings and workshops. Continuous updating of strategy must be done and feedback
must be obtained from the stakeholders.
8. Conclusion
The discussions conducted in the previous parts enables to conclude that change,
management and communication are critical for the success of the organisations in the ever
changing global business world. The change can be successfully implemented, only when it
is effectively communicated and efficiently managed by the top management of the company.
The report highlights the importance of the communication in the change management. It
further highlights the ways in which the effective communication can take place between the
management and the stakeholders in event of changes.
As evident from the case study based on the communication and leadership style of CEO
Cheryl Hailstorm of the company Lakeland wonders, the top management must focus
towards understanding the culture of the entity first in order to manage the change. This will
enable to effective management of change resistance. This can be done by effective
communication and team building. The report further prescribes various models and practices
which must be included by the managers in communication and the management of the
change strategy. The top management must do the transactional analysis and the stakeholder

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analysis; accordingly the strategy must be designed. Further, the change must be
communicated to the employees, their concerns and suggestions must be welcomed, along
with that of the senior stakeholders. The final strategy must be designed and explained and a
step by step implementation must be done. The managers must indulge in consistent
communication, team building, and group discussions to make the change take place
successfully. They must lead from the front, but also take everyone together. Thus, it can be
said that the content and way of the change communication has a material significance in the
implementation of the change.

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9. References
Alvesson, M., & Sveningsson, S. (2015). Changing organizational culture: Cultural change
work in progress. Oxon: Routledge.
Binder, J. (2016). Global project management: communication, collaboration and
management across borders. Oxon: Routledge.
Bolman, L. G., & Deal, T. E. (2017). Reframing organizations: Artistry, choice, and
leadership. UK: John Wiley & Sons.
Carnall, C. (2018). Managing change. Oxon: Routledge.
de Graaf, A., & Rosseau, M. (2015). Transactional analysis and conflict management:
Embracing conflict as an opportunity for growth and learning. Transactional Analysis
Journal, 45(4), 250-259.
Doppelt, B. (2017). Leading change toward sustainability: A change-management guide for
business, government and civil society. Oxon: Routledge.
Georgalis, J., Samaratunge, R., Kimberley, N., & Lu, Y. (2015). Change process
characteristics and resistance to organisational change: The role of employee
perceptions of justice. Australian Journal of Management, 40(1), 89-113.
Hayes, J. (2018). The theory and practice of change management. (5th ed.). UK: Palgrave.
Hughes, M., & Wearing, M. (2016). Organisations and management in social work:
everyday action for change. United States: Sage.
Jones, G. R. & George, J. M. (2016). Contemporary management (9th ed.). New York City,
NY: McGraw Hill Education.
Kiitam, A., McLay, A., & Pilli, T. (2016). Managing conflict in organisational change.
International Journal of Agile Systems and Management, 9(2), 114-134.
Olins, W. (2017). The new guide to identity: How to create and sustain change through
managing identity. Oxon: Routledge.
Rosenbaum, D., More, E., & Steane, P. (2018). Planned organisational change management:
Forward to the past? An exploratory literature review. Journal of Organizational
Change Management, 31(2), 286-303

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