2 UNDERSTANDING AND LEADING CHANGE Table of Contents Introduction......................................................................................................................................4 P1.....................................................................................................................................................4 Change in Business Context........................................................................................................4 Two Approaches to Change.........................................................................................................5 Types of organisational change, structure, organisation and technology:.......................................6 Organisation wide-change:..........................................................................................................6 Transformative changes:..............................................................................................................7 Personnel change:........................................................................................................................7 Drivers of change PESTEL and SWOT:.........................................................................................8 SWOT of Apple:..........................................................................................................................8 P2.....................................................................................................................................................9 Evaluate the ways in which internal and external drivers of change affect leadership, team and individual behavior within the organization................................................................................9 P3...................................................................................................................................................11 Evaluatemeasuresthatcanbetakentominimizenegativeimpactsofthechangeon organizational behavior.................................................................................................................11 Recommendation of a Solution to implement Change Successfully.............................................14 References......................................................................................................................................16
3 UNDERSTANDING AND LEADING CHANGE
4 UNDERSTANDING AND LEADING CHANGE Introduction Organisational changes are the outcomes of the factors or drivers of changes and have significant impacts on the organisational strategies.Cummings and Worley (2014) mention that theexternalenvironmentalfactorslikepoliticalchanges,competitivestrategiesofthe competitors, especially the strong competitors and customer preferences necessitate business organisations to change theirmodus operandito adapt to the changes. Similarly, internal factors like change of leadership styles and management decisions are also responsible for necessitating organisational changes. Organisational changes irrespective of their backgrounds have strong effects on the organisational strategies. The management have to play the role of change leader to initiate the process but eventually require the support of lower level employees as well to able to implement the change process. The aim of the paper would be exploring the process of organisational changes with the help of Burke-Lewin’s change model. Then the author would go on to apply the model to uncover how Apple manages organisational changes to introduce innovative products in the market. The paper would also consider Samsung Electronics Limited, the toughest global competitor of Apple Inc. P1. Change in Business Context The companies operating in the modern business world must be willing to move along with the times and adjust the operations of the business in response to the increased competition, technological advances, stakeholder expectations and other kind of pressures. The change in the
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5 UNDERSTANDING AND LEADING CHANGE context of the business can be termed as the way of moving the company or the business enterprise from the current state to the aim of the management on where it wants to be in the future. According to,Benn Edwards and Williams(2014)the improvement of the company in terms of the operations, strategies, business approaches can all be an example of the changes to be introduced by the owners and the authorities of the organizations. The changes are introduced to ensure new developments and innovations in the business of the organization. Two Approaches to Change The calm water metaphor includes there different elements namely; a.Unfreezing-The main change will be the introduction of the new segment of Smartphone of Apple in the market and a change in the approach of the organization. the new change will enable the company to get hold of the Smartphone market.Samsung Electronics Limited, the toughest competitor of Apple also brings about organisational changes in order to retain its global position against Apple(Caspin-Wagner Massini and Lewin 2018). It can be pointed out that while the market of Apple is restricted to high-end products, Samsung markets both high priced products as well as low price products. Thus, while the unfreezing action of Apple involves staffs manufacturing high-end products alone, the unfreezing action of Samsung requires involvement of employees of all the divisions. b.Changing to a new state-The new state of change will ensure the full conversion of the change in the organization where the change will lead to the customers having the belief about the new range of Smartphone manufactured by Apple and thus the following transition will though take some time, will decide on the success and the future of the new products.The customers of Samsung on the other hand expect the company to offer
6 UNDERSTANDING AND LEADING CHANGE more facilities in the low priced or medium priced products as well. The high-end products or Samsung like Apple are expensive and have advanced configuration, often surpassing their Apple counterparts Thus, changing to a new state is more complex and lengthy in Samsung compared to Apple. c.Refreezing-The organization will have to refreeze the new change in order to stabilize the process of the new change. The refreezing of the change will help the customers to adapt to the changes and make the organization more stable on the following product. The new sense of stability will make the employees of Apple and Samsung feel confident and comfortable with the new product category. Types of organisational change, structure, organisation and technology: The following are the types of organisational changes and their structures including the technological aspects: Organisation wide-change: Organisational wide-changes are changes which affect the entire organisation and require prompt actions from the management.Hussainet al. (2018) mention that organisation wide- changes are the outcome of significant changes in the external environmental conditions like changes in bilateral relationship between home countries and host countries. These changes are capable of impacting the businesses in several ways like requiring the companies concerned to withdraw from specific markets, thus losing customer base and revenue from the customer base altogether. Kostova and Hult (2016) strengthens the argument by pointing out that effective management of these changes are crucial in order to minimise the negative impacts of these changes, if any. As far as Apple Inc. is concerned, the company operates in more than a hundred
7 UNDERSTANDING AND LEADING CHANGE countries. The changes like tax structures and changing relationship between its home country, the US and in specific host countries require the management of Apple to take accurate decisions to adapt to such changes and sustain in the market. Thus, in short organisation wide changes are so crucial and have such strong impacts on the business of the organisations that the management require to manage these changes very strategically. Failure to manage organisation wide changes efficiently can lead to massive loss to the companies concerned. Transformative changes: Transformative changes require the companies to bring about changes in specific areas of operations instead of targeting the company as a whole unlike organisation wide changes. Jordan, Werner and Venter (2015) mention that transformational changes have significant impactsontheoperationsofcompanies.AsfarasAppleisconcerned,theAmerican multinational IT giant brings about innovation and improvement in its products which in turn requires the company to bring about continuous transformations in its manufacturing process. Caspin-Wagner, Massini and Lewin (2018) mention that companies in order to respond to transformative changes. Personnel change: Personnel changes refer to the changes which comes about in companies as outcome of mass hiring or layoffs. However, it can be pointed out that unlike the two previous changes, personnel changes result in massive damage to the organisational productivity. This is because loss of staff also leads to loss of talent and skills. However, it can be pointed out that multinational companies generally aim to resist such changes in order to retain employees.
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8 UNDERSTANDING AND LEADING CHANGE Drivers of change PESTEL and SWOT: The drivers of change can be both external and internal. The management of the business organisations like Apple in order to manage changes efficiently and effective conduct PEST analysis. The following are the PEST analysis of the United States of America, the country of domicile of Apple Inc. Political 1. The United States of America is politically stable. 2. Have strong bilateral relationship with both developed and emerging countries. Economic 1. Economically strong 2. High GDP 3. Strong supply chains 4.Strongnetworkofbanksandnon-banking financial institutions. 5. Home to top stock exchanges like NYSE. Social 1. High per capita income among consumers. 2. Huge demand for technological gadgets in the American society. Technological: 1. Technologically strong 2. Deep internet penetration. Environmental 1.Disposalofusedandnonworking device is a major environmental issue 2.China’s efforts to cut the emission of greenhouse gases has led to the rise of costs for Apple in the country 3.Climate change has badly affected the suppl chain of the company Legal 1.Thecompanyhasrecentlyentered the highly regulated financial sector of the marketthrough Apple Pay. Thiscanincreasethelevelof regulation and Government oversight 2.Apple may face increased cases of litigationbyofferingfinancial services SWOT of Apple: Strengths: 1. Global presence 2. Financial strength 3. High-end product line Weaknesses 1.Cannottargetmiddleclasscustomersunlike competitors like Samsung. 2. Samsung is both a supplier and competitor Threats: 1. Weakening USD. 2. Volatile political relationship 3. Competition from low cost competitors. Opportunities 1. Expansion into new countries. 2. Expansion of product line. 3. Introduction of new medium priced products like Samsung.
9 UNDERSTANDING AND LEADING CHANGE P2 Evaluate the ways in which internal and external drivers of change affect leadership, team and individual behavior within the organization The Burke Litwin model aims to bring in a change in the organization that will help in the change of the performance of the business enterprise by establishment of different kind of links in between the performance and the internal and external factors that have an impact on the performance of the business organization. The change Model is based on the assessment of the organizational and environmental factors that can be implemented in the organization to ensure a successful change. The change model starts with the outlining of the framework which comprises of the different factors of business transformation. The key factors of the transformation model are as follows; 1.External environment of the business enterprise is considered to be the most important model of change and therefore it is the one that triggers the change in the organization. 2.The changes of the model are implemented mostly on the structure, policies and the different practices of the organization. 3.All the different acting factors put together generally have an impact on the motivation levelofthedifferentindividualswhichinturnaffectstheperformanceofthe organization 4.There are generally 12 different dimensions which includes the likes of the change model and interact with and has a negative impact on each other The development of innovative and quality products and services is one of the most core business strategies of Apple Inc. The competitive edge of the business organization is mostly
10 UNDERSTANDING AND LEADING CHANGE attained by means of the innovation and quality of the products. The following helps the organization to stay ahead in the race and be unique from other kind of competitors in the business. The change management strategies are helping the organization to implement it successfully. The concept of organizational change generally comes from the nature and environment of the organizations. Change is generally defined as the different events that support the process of development in Apple Inc(Cummings and Worley 2014). The management of Apple Inc. has described the organizational change as the rightsizing, development of new products and services, implementation of new technologies as the features of the change management process. There are generally two kinds of elements that help the employees to perform well in the organization. This includes both tangible as well as intangible elements. The tangible element deals with the recruitment of the right persons for the right task and also implementing the right technological tools for providing the best services and innovating the different kind of business models accordingly. Cummings and Worley(2014) in his study says thatEmployee performance is vital for the success of a company like Apple where the employees are involved in the creation of high performance technological devices like Mobiles, laptops and other technological appliances. The constant review of the employee remuneration and increase in the remuneration of the employees helps the organization to ensure a better and improved performance. The management of Apple Inc. believes that the employee will only perform best when they are able to enjoy the jobs on which they have been working on. The company uses both intrinsic as well as extrinsic awards to ensure that the employees are always motivated. The tasks provided by the organization to their employees are challenging and never easy(Cummings and Worley 2014). The challenges that the
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11 UNDERSTANDING AND LEADING CHANGE employee faces while completing the task automatically improves their performance. The extrinsic motivation of the employees on the other hand can be provided through extrinsic rewards like gifts, money, recognition that helps to motivate the employees accordingly. The organizational strategy of Apple is dedicated solely towards innovating quality products, totally different from the others in the market. The changes in the strategy of the company can have positive effects. New strategic directions can help the company adapt to the different kinds ofchangesinthelegalenvironmentaswellasthemarketplaceofthebusiness organization(Hussain et al. 2018). The strategies adapted by the organization generally help the management of apple to perform more effectively and develop new products that are totally unique from the ones provided by the other companies. The changes in the strategies also help Apple to enter into new markets and help them to target their niche customers(Kostova and Hult 2016). Though, most of the change management strategies have failed for Apple, the company has been able to make a decent name for itself in the luxury product category which certainly proves its competence strategy. P3 Evaluate measures that can be taken to minimize negative impacts of the change on organizational behavior Apple Inc. uses systems theory and continuous improvement models to bring about changes proactively.The management at the apical level and middle level in order to ensure efficient execution of strategies breaks them down intosub-systems. The multinational company then integrates the functions of the different departments which ultimately culminates into the
12 UNDERSTANDING AND LEADING CHANGE organizational productivity. This system issynergywhich plays a very important role in driving changes in the organisation.Change isinevitable in all of the industries in the modern market. Most of the organizations in today’s competitive market are fearful and test the waters of change after a detailed and scientific observation and analysis of other organizations and their process of change management. The changes in the organization are met with different kinds of resistance that tends to disrupt the policies of the organization. The resistance to changes can bring serious problems to the organization as because the employees may not be satisfied with the change in the business. The organizational change management strategies typically look at the people within the business organization. The organization can expect most of the important steps of managing change by keeping concentration over them. The management of Apple has identified some of the steps that will cover the change management strategy of the business enterprise. This includes; 1.Involvement- As mentioned earlier the management of Apple always involves the right people at the right place. This involves the recruitment of the right people in the right departments of the organization. The involvement of the right people at the right place will help the organization to run the business smoothly and effectively. 2.Impact- Before the implementation of the changes the management of Apple considers the impact that they generally have on the people who are involved with Apple. It is quite likely that the employees of the business will certainly raise their concerns regarding the same in the organization. 3.Communication- The existence of a high quality communication network is the basis of the organization. Apple being one of the major tech giants of the globe has established a
13 UNDERSTANDING AND LEADING CHANGE complex yet advanced communication network that helps an easy transformation of the different information. 4.Readiness- Another major advantage of Apple Inc. is that the employees of the company are always optimistic about the new trends. The employees of Apple are always ready to accept the new policies and the changes in the organization. The management of Apple Inc. however believes in continuous improvement process which can be defined as a continuous process of improvement and is done with the idea of a long term approach. The long term approach of the organization is beneficial as because it helps to implement the change process in a gradual manner which can be helpful to avoid any forms of resistance from the employees or any other kinds of sources. According to,Kostova and Hult(2016)the continuous improvement process can also become part of the larger change management initiative that helps to improve business conditions and increase efficiency. Apart from such a process it is also important because the innovation of the company can be carried forward with better accuracy in the continuous development process of the business enterprise. Apple Inc. has evolved gradually in the last decade from a small computer manufacturing firm to a global technological giant known for its ultra-luxury and technologically one of the most superior brands in the market(Lubberink Blok van Ophem and Omta 2017). However, the change in the operations model that is currently used by the organization will help to strengthen the position of the company and provide them a competitive edge in the Smartphone segment. The following sector has currently seen a large amount of companies that produce low end Smartphone that are seen to be of a low quality. The field analysis of the company focuses on the market position of the organization with the ultimate aim of strengthening the grip of the firm on the premium Smartphone sector.
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14 UNDERSTANDING AND LEADING CHANGE The implementation of theFORCE FIELD ANALYSISincludes the organization will involve a change in the mission of the organization. The new mission will be anchored on two different fundamental visions. The very first vision will be to ensure smooth communication and create strategic provisions for the infrastructure of the organization. The next vision of the company is to capture and control the Smartphone industry accordingly. The management of Apple has already thought about introduction of some substitute smart phones in the market with a lower price tag to ensure the creation of a new Smartphone market and enjoy maximum profitability. Recommendation of a Solution to implement Change Successfully The different departments of Apple share similar perceptions and commitments towards the organizational performance, thereby getting involved in the operations. The managers in the company use participative leadership style and encourage the subordinates to participate in decisionmaking.Thiscreatesanenvironmentwheretheemployeesofalldesignations participate in the operations of Apple with equal commitment. The managers are as a result enable to manage thetriggersto organizational changes. They mentor and train the employees who resent the change in order to enforce commitment towards the organizational change. The management of Apple, using theBurke-Lewin modeltake steps to make the changes effective. The departmental heads of Apple and all the regional heads form strategies to effectively manage the changes. The change management strategies involve training of all employees to adapt to the changes. This ensures that the employees of the company remain at par with the market requirements in terms of skills and competencies, thus making Apple one of the most innovative companies all over the world. The change in communication nstyle and
15 UNDERSTANDING AND LEADING CHANGE implementation of a participative leadership form will be essential for the business to move forward and make it sustainable. Some of the recommendations in the following case are as follows; 1.The company must target the middle class with some new and innovative products to effectively compete with the likes of Samsung and other competitions in the market 2.It is important for the company to engage the workers in major decisions as it can be helpful to gain success 3.It is also important for the business to expand to new countries and have a local domestic structure in those countries 4.Bring about effective as well as collective change
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17 UNDERSTANDING AND LEADING CHANGE Martinsuo, M. and Hoverfält, P., 2018. Change program management: Toward a capability for managing value-oriented, integrated multi-project change in its context.International Journal of Project Management,36(1), pp.134-146. Salman, Y. and Broten, N., 2017.Leading Change. Macat Library. Shahzad,S.K.,2016.Privatefirms'adaptationtoclimatechangewithinthecontextof developing countries: A pitch.Accounting and Management Information Systems,15(1), pp.168- 177. Wirtz, B.W., Pistoia, A., Ullrich, S. and Göttel, V., 2016. Business models: Origin, development andfutureresearchperspectives.Longrangeplanning,49(1),pp.36-54. Jordan, P.J., Werner, A. and Venter, D., 2015. Achieving excellence in private intensive care units: The effect of transformational leadership and organisational culture on organisational change outcomes.SA Journal of Human Resource Management,13(1), p.10.