Executive summary Strategic change management allow organization to carefully make changes in their business and it is a well structured plan that helps to meet the organization goals and objectives. Through this report, researcher and learners gain knowledge related to change management system. Chosen firm for this is HSBC bank which is British Multinational investment bank who also wants to make strategic changes. Through the report, researcher gain three different types of strategic change management tool and describe the need of opting the same. Further, the report will also describe the system that is involve in stakeholders for planning the change and also evaluate the system as well. Then, with the help of two change management model, it describe some challenges face by the firm.
Table of Contents Executive summary..........................................................................................................................2 INTRODUCTION...........................................................................................................................1 Introduction of organization and background of change.............................................................1 1.1 Presenting the model of strategic change...............................................................................1 1.2 Describing the relevance of models of strategic change in an organization..........................2 1.3 Describing value of using strategic intervention techniques in organization........................3 2.1 Need for strategic change in a firm........................................................................................4 2.2 describing the factor that driving the need for change...........................................................4 AC 2.3: Assess the resource implications of the organization not responding to the Strategic change........................................................................................................................................1 AC 3.1: Develop systems to involve stakeholders in the planning of change.............................2 3.2 Developing change management strategy with stakeholders................................................2 3.2: Change management strategy...............................................................................................4 3.4: Strategy for managing resistance to change.........................................................................4 4.1 Appropriate models for change..............................................................................................6 4.2 Plan to implement model.......................................................................................................8 4.3 Measures to monitor growth..................................................................................................9 CONCLUSION................................................................................................................................9 Recommendations......................................................................................................................10 REFERENCES..............................................................................................................................11
INTRODUCTION Strategic change management is that process which helps to manage change in the structured way so that it will help to meet the organizational goal as well as mission. For every company, change is necessary in order to continue to thrive and to stay competitive in the market as well. In the same way, chosen company is HSBC which is one of the leading investment bank fin UK and report will describe different models of strategic change and describe the need of adopting the change into the working area and then discuss the factor as well as resource implications that needs for the change. Further, study also develop a system that involve stakeholders and then create the strategy for managing the resistance of change as well. Lastly, report describe best model for change and measures to monitor progress as well. Introduction of organization and background of change HSBC bank is the British multinational investment bank in UK and it is the seventh largest bank in world as per its assets, further, the companyalso has more than 3800 offices in more than 65 countries and also has more than 38 million customers. Therefore, this shows that firm has brand image at international level. Currently the company faces issues technological change and for that there is a need to implement change model by analysing the market conditions. 1.1 Presenting the model of strategic change Lewin's change management model: It is the most common change management tool that remains relevant because of its effective structure. Moreover, this model is introduce by Kurt Lewin and it is broken into three stages such that:Unfreeze:in this, the team should unfreeze their present process and change their views for upcoming changes. Therefore, it helps the team to take challenge and complete the task without bias (Change Management Tool,2018).Change:next stage, in which mangers try to implement change through effective communication in its entire channel. Refreeze:in this, by taking review from the peers, manager come to know whether the change is implemented successfully or not. ADKAR model: 1
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It is another popular change model which Is based upon people focused approach and introduce by Jeffrey Hiatt that helps to facilitate at individual level (Tang, 2019). The model also describe more about the people' reaction to them and it is consist of five main points i.e.Awareness:in this, manager create awareness of the need for a change and also explain the reason for changing the system, so that employee able to understand the need and may ask any question related to this.Desire:In this, employee show desire to participate in and also support for the changes as well.Knowledge:in this manager, provide training session in order to enhance the skill of employee to accept the change.Ability:through effective schedule, employer may determine the champions and develop ability to implement changes. Reinforcement:Monitor the change and provide specific changes as well. Kottler 8 stage model: This model is used by large organization because it specifically turns resistant individuals into receptive participants through their trust, transparency and teamwork (Bridgman,2016). Further, by identifying the end goals, developing or involving employees and executing the changes together helps to remain the long lasting change and leads a business towards success as well. Therefore, it is work under 8 stages such that: develop a sense of urgency build a strong coalition develop strategic vision get everyone buy-in take action by remove barrier implement short- term win sustain alteration Implement change 1.2 Describing the relevance of models of strategic change in an organization From last many years, there is a sudden fluctuation In the economy and that is why, every company wants to make changes in its working environment. Thus, strategic change models are quite effective for HSBC bank because as the company face issue related to advance technology 2
and that is why, with the help of model, company may easily accept the change. For the same, all above mentioned three models are quite effective to use because by using Kurt Lewin change management model, HSBC cuts out a lot of complexity and fluff which are involve in other model and by implementing the same, company's employees easily understand to implement the change and as a result, it makes easy to plan around and it also try to minimize the difficulty as well (Bakaria, Hunjrab and Masood, 2017). Moreover, this change management model helps to reject the fear of change among employees so that they will survive in the difficult situation. On the other side, there is a need to implement the technology change into the working area and for that, ADKAR model is also used for implementing change because it focus on results as compared to task. Even it also provide the checklist of things which need to be done to manage change. Therefore, as the model provides practical approach of change management and by providing effective training system, company may implement the same. On the other side, Kottler eight stage model also helps to create support and make employees aware to accept the employees and it is possible only if the company have new vision. Through this model, HSBC also take opinions from their employees and then make final decision too. 1.3 Describing value of using strategic intervention techniques in organization As per the view ofBurnes and Bargal, (2017)strategic change is the key that lead a firm towards better future performance, but the manager may faces different issues or challenges whileimplementingstrategicplanning.Thatiswhy,byadoptingstrategicintervention techniques, company may creates cooperation between manager and team workers. Therefore, a systematic implementation of change is intended to impact upon business basic, but the strategic intervention used to facilitate change in an organization structure so that it will more rapidly accept the changes i.e. disruptive technology, high competition and fluctuation in market. Therefore, by using strategic intervention techniques such asTechno structural interventionby HSBC Bank which is completely based upon technology and structure so that it will help to cope up the issue. On the other side, this strategy also deliver the best results for the company. For example, using this intervention, quoted firm saves time and develop new programs that helps to reduce cost and also attract wide range of customers too. Moreover, by using the strategic intervention technique, HSBC develop opportunities for developing growth options and it also provide 3
continuous innovation products so that it will help in customer retention and technology adaption too. In addition to this, using best strategic intervention technique, the company easily overcome the problem of technological factor and easily adapt different ways through which the company raise its brand image at international level. 2.1 Need for strategic change in a firm There is a need for change within a firm because of the following reasons: Changes in market:there is continuously fluctuation in the market and due to tough competition in market, the company always provide innovative and unique products in market in order to response the sudden change in the market (Hassan, 2018). In the same way, HSBC also wants to make strategic decision whether they will lead and lag the market. Economic downturns:The factor create negative impact upon the firm such that if there is a strong economy and increasing demand of products, firm may easily develop better growth opportunities in order to represent new challenges. But on the other side, weak economy creates problemand to cope up this situation, manager of HSBC should make decision so that it will help to maintain the strong brand image with customers as well as employees. Customer expectation:as per changing market and demand of customers also changes and they also expect more from the companies. Thus, HSBC provides all the financial services to their customer in unique way as compared to its competitors, so that it directly open different opportunities or the companies in order to meet those needs as well. That is why, to meet the customer expectation, HSBC needs to implement strategic change. New technologies:In this modern era, every company wants to be stay competitive and that is why, they all used advance technology (Cummings, Bridgman and Brown, 2016). Therefore, without change, business leaders will never be on top in the competition. In the same way,HSBCalsofacesissuerelatedtotechniquesbecauseinthisera,therearemany technologies in IT which force companies to adopt these technologies so that it will help to lead a business towards success. 2.2 describing the factor that driving the need for change There are different factors that driving the needs for a change such that internal factor and external factor which are as mention: Internal factor:this factor includes factors within an organization and these are: 4
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Employees:as they are the major part of an organization and also plays a vital role in company's internal environment such that if the manager are good at handling issues and overseeing other parts in internal environment, then it will creates good working environment within the employees (.Cameron and Green, 2015). But on the same side, employees are not able to handle the issues and they have no ability then it will creates negative impact upon the business as well as its working environment too. Customers:as per this modern era, customers suddenly changes their perception and views, further, the power of customers are also depend upon how fierce the competition and what are the products which company offer to their customers. Therefore, this forces the company to introduce new products and uses advance techniques in order to attract wide range of customers towards it. External Factor:it includes the factor which affect the entire business externally and these are as mention below: Digital Disruptive:in the modern era, new and digital technology plays an important role and in the same way, to stay competitive in this competitive market, every company used advance technology. In the same way, HSBC also faces issue related to advance technological and advancement in IT as well. Therefore, using innovation and advancement in technology will help quotes firm to raise its brand image and also cope up with the problem. Moreover, by using Artificial intelligence as a technology issue will help a company to cope up with digital disruptive. 5
AC 2.3: Assess the resource implications of the organization not responding to the Strategic change. If HSBC is not engaged in following or responding to change then following implications can occur in company. This includes the following: Human and physical resources-It has been analysed that HSBC is involved in bringing technological changes. For this they need to have support from all the employees working in organization. Company for proper implication can engage into restructuring of the organization structure. They also need to provide proper training and learning to employees so that the modifications can be properly established. This can support firm in overcoming the conflicts which might be face by them during the time they are implementing changes. HSBC can also engage in hiring new and efficient workers so that they can easily survive during the time of changes. It would also be easier for them to understand about the technological changes which are being implemented in firm. If Human resource of company is being properly trained, then it will also support HSBC in increasing their operational efficiency and productivity(North and Kumta, 2018). This will also assist firm in growing and implementing the change in properly and efficiently. Financial resources- If the Technological change which is going in and on in HSBC is not being properly implemented then it can increase the operational cost of business. It can also increase the cost related to training, learning and development. Changes perceived as negative drain resources further, making it difficult to cope with and implement change. Also company must make sure that every employee must be aware about the changes which is going in organization, so that employees of HSBC make effective use of resources. This will help company in saving cost and reducing the expenses related to training and learning. Employees must adapt to many changes beyond those identified as planned change initiatives. Prioritize, sequence, and coordinate changes throughout the organization to reduce or offset the cumulative change cost to employees(Wolf and Floyd, 2017). This will help company in implementing the technological change adequately and efficiently. This can support firm in growing.
AC 3.1: Develop systems to involve stakeholders in the planning of change Stakeholders are the person who must have full information related to the changes which will be implemented in organization. The main stakeholders are customers, suppliers, employees, investors and many more. Proposed Change- HSBC must be engage in bringing changes in the culture of organization so that they can gain competitive advantage and are able to grow. The main stakeholders who must have the full knowledge about the technological change are employees and consumers. This can help company in adapting the changes easily. Also company must make sure that the employees provide them support, so that it can become easier for them to bring change. Communication and consultation strategy-When bringing change, HSBC must make sure that they are engage in properly communicating the changes to all stakeholders. They must also be engage in openly communication with employees so that they can analyse if there exist problems while implementing the change. This can also help company in making better relationship with employees. It will also support them in creating employee loyalty. Company can engage in face to face conversation with workers, so that they can understand the changes effectively. This will also help company in reducing the employee turnover during the time of change. Group meeting and team development- HSBC when implementing technological changes must be engage in meeting with their teams, so that the team stayed motivated and they provide support during the time of change. Organization must also be engage in providing training to workers, so that they will be able to understand the change effectively and efficiently(Pugh, 2016). Group meeting will also help them in having new ideas which can be used to overcome the problems. Delegation of responsibility-HSBC must also make sure that during the time of technological change they must know that all responsibility and task provided to employees is according to their skills and qualification. This will help them in finishing task on time and will also enhance their operational efficiency. This can help firm in growing and attracting more employees towards them. It will also help firm in growing. 3.2 Developing change management strategy with stakeholders HSBCbankisrequiredtodevelopchangemanagementstrategieswithitsstakeholders. Strategies to be developed are : 2
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Leveraging strategies Leveraging strategies are used by those that are ready for accepting the change in initial stages and are usually known as leaders of change since they motivate employees for accepting the change. Leader motivate employees to accept the change by driving them toward the benefits which will be acquired by accepting the change in organisation. Engagement Strategy Strategy of engagement is used by those stakeholders that are part of unwilling and reluctant majority. Engagement strategy is used for inverting these reluctant employees of organisation in easy adapters of change and using the employees as tool for convincing other employees of organisation.Thestrategyconverttheresistingemployeesbymakingappropriate communication and identifying the reasons behind resistance. This strategy involves training and educating employees about change. Containment Strategy Strategy is for resisting slackers that are not ready for acceptingchange but are competent. These people contribute in change process therefore it is essential for the company to convince them for the acceptance of change. These are the efficient employees whose contribution helps in growth of business. Outplacement strategy Strategy is applied for people that are not for accepting the change. These stakeholders are provide with required number of opportunities for accepting the change(Lewis, Cantore and Passmore, 2016). When they do not accept change they are dealt with other ways. For the change in HSBC all employees are required to be through help of change management. 3
3.2: Change management strategy. For implementing requisites changes in the business, HSBC is required to adopt sound business strategies and plans from the perspective of employees benefit as well as organizational growth.Thus,followingarethestrategiesforeffectivechangemanagementandits implementation in the HSBC bank: 1.Proposing incentives– By offering incentives and other monetary benefits to the employees, it will help them in increasing their motivation level to a great extent. Also, by making appreciation of the work done or target achieved by employees, HSBC can encourage to work towards attainment of new goals with adoption of new and better improved techniques, processes (Fernandez and Rainey,2017). This will thus reduces overall cost and increases profitability aspects of HSBC. 2.Redefining culture and value –By establishing the culture of continuous change and improvement in the business, HSBC can make its employees ready for adopting any kind of changes being made therein at any time.By redefining the culture and values of the organisation, it will force its employees to work according to new cultural aspects and beliefs related to changed business processes and technological development. 3.Shifting change burden– The change management burden in such case is shifted from the top management level to employees. HSBC by adopting such new technological changes and new structure can compete and survive in the market place with the help of new business processes, values, techniques thus making it capable of dealing with high competition level. On shifting burden of change to employees, it helps them in showing their capability and skills along with unique and innovative business ideas with the help of which HSBC bank can capture market opportunities along high customer base as well. 4.Recruiting change management expert– Implementing plan related to changes in the business organisation is not an easy task as it is related with formulation of sound businessplansandstrategies(Hayes,2018).Byassigningsuchdutytochange management expert, it will help HSBC in overcoming its issues related to change resistance as made by its employees. 3.4: Strategy for managing resistance to change. Change in any organization brings in some positive as well as negative aspect to the company as well as to its employees. It is thus required on the part of management of the
company to manage and control the resistance of such changes among the employees by imparting proper training and workshop to them along with better improved communication facility. HSBC bank has made plan of implementing technological changes in its business operations from the perspective of better improved functions to its customers across the globe. Following are the strategies which can assists the management in managing its employees change resistance: 5
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Defining structure of team for maximizing the overall potential level– While formulating any plan or strategies, HSBC is required to consider its employees potential as well as skill level (Hickman and Silva, 2018). By making allocation of duties and role as per their skills and knowledge will help the company in overcoming its resistance to new techniques of conducting the business processes. Setting targets and challenges to be met– Many employees resist for new changes which are going to be implemented in the business processes and operations as they have less knowledge of it along with habitual of using the same techniques and methods which theyhaveknowledgeof.Bydefiningtargetsandchallengestoemployees,the management of HSBC can help employees in achieving their individual goals along with company's as well. Communicating the manner of implementing such changes and how targets can be achieved will help HSBC in gaining competitive edge. Conflict resolving– One of the major aspect of every business organization is related to proper and clear communication process in between employees and employers for smooth business operations (Lines and et.al., 2015). Ideas of each team member should be considered before making a conclusion or decision to mitigate the chances of arising conflict therein.It is very much essential to regulate and have proper communication system in the company so as to define business strategies and plans to attain the set defined goals. Empowering innovation and creativity- Defining how technological advancement will help HSBC in increasing its market and customer share to its employees, will help in managing such resistance to a level. By empowering employees, it helps them in showing their unique skills, creativity and innovative ideas which can be used by HSBC bank in capturing current market opportunities. 4.1 Appropriate models for change Lewin's change management model-this model is based upon 3 step procedures such as Change, Unfreeze and Freeze that gives high level methods to change. It provide managers of HSBC bank to implement change (Bakari, Hunjra and Niazi,2017). This model helps to make radical change, decrease disruption of structure operations and assure that change is adopted for ever. Three steps of this model gives person idea of what is the significant of implementing change and its means when dealing with workers. 6
Unfreeze- Advancement of technology put pressure on firm to implement change in their existing business structure which is beneficial for them. In order to run business efficiently, HSBC bank manager implement change related to technology, it helps to increase efficiency of their daily operations. When manager think about to change their current technologies with the new ones, many people refuse it because it impact on their daily routine and work efficiencies. By understanding the need of change, leaders and managers motivate workers to perform with new technology and adopt in day to day work. Unfreezing means getting workers to gain perspective on its daily activities, open up to new ways of reaching objectives and unlearn bad habits of them. HSBC managers collaborate to leaders and work together for implementing change in technology that is beneficial for workers as well as business. They shows the benefits of change in workplace for people and try to conveyance them. Change- After conveyancing group of people for implementing change that they can adopt without deny, manager proceed towards it. In simple words, once team members opened up their mind, managers can start changing technology (Huarng and Mas-Tur, 2016). Procedure of change is quite dynamic, but if its to be good it probably take some time and give better results. Freeze- After Passing above stages effectively, finally it come to the final step where the change has been implemented permanently with the support of applicants in business. ADKAR model- This model is appropriate for change, it is 5 phase framework that support to deal with candidates aspect of change management. Awareness- When management need to implement new technology within business as change they need to communicate with their workers and generate awareness among them regarding this before making any plan. Desire- After interacting to team, they need to understand need for change and also able to understood requirement of this (Obonyo and Kerongo, 2015). When employees want to make some changes in business, manager will be able to understand it and support them. 7
Knowledge- Without knowing how to get things done with new change, staff cannot be able to work effectively. For example, if management implement new technology, staff need to know how to operate it safely and correctly. Ability When manager implement change related to technology, they need to enhance the ability of workers which beneficial for success of overall procedure, if they do not increased staff skills they get failed to apply new technology. Reinforcement- Everything is going good, according to implementation of change, but still many people do not used new technology (Shepherd and et.al., 2014). Reinforcement works in this situation where management give workers lots of feedback and will exercise vigilance. 4.2 Plan to implement model To implement model for change in HSBC organization, manager need to create plan which is essential to run this procedure effectively. First of all, they has to determine the need of change, if it is beneficial for business or not (8 Steps to Implementing Successful Organizational Change,2017). Before analysing the requirement and situation get cannot be able to implement change. Furthermore,management supportfor change is highly effective. In workplace many peoples do not wants to make any change, so it is very essential to create a situation for change that is beneficial for both company as well as its employees. They take better decision in which involvement of staff is required. Organizational change whether small or large needs to be communicated and explained,specially changes that influence how staff perform its roles. Discussion and communicating change need to be systematic and structured, workers get alltheinformationaboutimplementtechnologychanges.Whenmanagementmadepoor communication with staff and rumour mill began spreading rumours about change, it create resistance to implement change that is not appropriate for overall business. Managers need to be proactive in communications that helps to minimize resistance and make workers feel like they are essential part of procedure. At last, once change is planned effectively, it is essential to have good interaction about roll out and implementation of technology change. They need to set afixed timelinefor changes and implementation of plan in order to gain success for longer period. Resistance of workers is 8
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internalcircumstancesthatimpactoncompanytoimplementplan.Ontheotherhand, advancement of technology is external factors which also impacting the current procedure of firm. 4.3 Measures to monitor growth Managers of HSBC bank, measures the progress of implementing change, they need to create project outlines, first step is to identify goals and objective of program. Determine any issues related to this for solving it has soon as possible. Step no two, once they defined goals of implement technology change it is the right time to define indicators for measuring progress towards achieving it. Step three, manager need to define timeline after creating monitoring indicators, that helps to done work on time. They has to identify that all the workers is adopting change in their work and does they work accordingly or not. Through feedbacks from co-workers they can also measure progress of new plan which has been implemented in above stages for growth of business. Once the change is implemented, monitoring is very essential as it helps to assure the operational efficiencies. Manager need to create reporting templates and analysis plan that should include with details about what is working more effectively and what is not. So they can improve in better way. CONCLUSION By summing up above report it has been concluded that in every company there is a need to implement change in the business because it helps to leads and develop better opportunities within the business. Therefore, report concluded Kurt Lewin change model, ADKAR model and Kottler 8 stages model that helps to implement the change easily. Further, study concluded by analysing the market condition and technological factor that HSBC need to implement advance technology in its working area so that it will help to provide positive environment to its employees. Moreover, it is concluded that firm must have physical, financial and human resources in order to cope up the issues that is related to strategic change and through proper 9
communication with the stakeholders, company easily involve stakeholders in the planning of change. Further, it uses stakeholders mapping analysis in order to involve stakeholders and to develop technological change, HSBC uses Kurt Lewin change and Kottler 8 stage model as well. Lastly, report concluded that company may use benchmarking as a monitoring tool in order to monitor the progress. Recommendations As per the above, it has been analysed that HSBC faces issues related to technology factor and in order to deliver the best variety of products to their customers, it is recommended to the firm to use Total Quality management in order to maintain the quality and provide best products to their customers as well. Moreover, the firm needs to be focus on the change so that it will get the biggest potential benefits. In addition to this, it is also recommended to the firm to use artificial intelligence in order to meet the project deadlines. Further, in order to make employees aware with the advance technology, it is required to provide effective training sessions to them, so that they will enhance their skills and capabilities as well. In addition to this, it is further recommended to HSBC that providing the products and services at low rates in order to attract wide range of customers and even if the firm is expanding its unit, then it is quite necessary for the business to analyse all external factors so that it will not affect the overall business.Moreover, in order to implement the change into the working area, company needs to follow Kurt Lewin change management model so that it will make employees aware to implement new changes into the working area. 10
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Obonyo, E.S. and Kerongo, F., 2015. Factors affecting strategic change management and the performance of commercial banks in Kenya: A case study of Kenya commercial bank in Nairobi region.European Journal of Business and Management.7(15). pp.109-117. Shepherd, M.L and et.al., 2014. Using the awareness, desire, knowledge, ability, reinforcement modeltobuildasharedgovernanceculture.JournalofNursingEducationand Practice.4(6). p.90. Tang, K. N., 2019. Change management. InLeadership and Change Management(pp. 47-55). Springer, Singapore. North, K. and Kumta, G., 2018.Knowledge management: Value creation through organizational learning. Springer. Wolf, C. and Floyd, S.W., 2017. Strategic planning research: Toward a theory-driven agenda. Journal of Management.43(6). pp.1754-1788. Pugh, L., 2016.Change management in information services. Routledge. Lewis, S., Cantore, S. and Passmore, J., 2016.Appreciative inquiry for change management: Using AI to facilitate organizational development. Kogan Page Publishers. Online 8StepstoImplementingSuccessfulOrganizationalChange.2017.[Online].Available through:<https://thethrivingsmallbusiness.com/implementing-organizational-change/> ChangeManagementTool.2018.[Online].Availablethrough: <https://www.lucidchart.com/blog/7-fundamental-change-management-models>. 12