Understanding and Leading Change

This report discusses the impacts of change on organizations, drivers of change, barriers to change, and leadership approaches in dealing with change. It compares the impacts of change on two companies, H&M and Arcadia, and explores the strategies they can adopt to minimize negative impacts and gain a competitive advantage. The report also analyzes the drivers of change, such as internal and external factors, and discusses the ways in which these drivers affect leadership, team, and individual behaviors. Additionally, it examines the measures that can be taken to minimize the negative impact of change and evaluates the response of organizations to change. Finally, the report explores the barriers to change and how they influence leadership decision-making, and discusses different leadership approaches in dealing with change and their effectiveness.

Understanding and
Leading Change

Table of Contents
Introduction......................................................................................................................................3
Task1................................................................................................................................................3
P1) Comparison of impacts of change on organisations.............................................................3
M1) Different drivers of change.................................................................................................5
Task2................................................................................................................................................5
P2) Ways in which drivers of change affect leadership, team and individual behaviours..........5
P3) Measures taken to minimise negative impact of change......................................................7
M2) Critical evaluation of response of organisation to change..................................................8
D1) Conclusions and recommendations for planning for change ..............................................8
Task3................................................................................................................................................9
P4) Barriers for change and how they influence leadership decision-making............................9
M3) Force field analysis to analyse driving and resisting forces................................................9
D2) Critical evaluation of force field analysis..........................................................................10
Task4..............................................................................................................................................11
P5) Different leadership approaches in dealing with change....................................................11
M4) Extent to which leadership approaches can deliver organisational changes.....................12
D3) Critically evaluate the effectiveness of leadership approaches..........................................12
Conclusion.....................................................................................................................................14
References......................................................................................................................................15

Introduction
In order to remain successful in the changing market it is important that managers of an
organisation bring changes in the strategies and operations which can help in exploring new
opportunities in the market along with efficiently dealing with potential risks in the market.
Change also help an organisation in in effectively meeting the changing needs and preferences of
customers so that companies can remain highly profitable in the market and gain a competitive
advantage (Albrecht and et. al., 2015). There are various internal and external factors which
affect the company and must be continuously analysed so that their negative impacts can be
minimised while increasing the motivation of workers, decreasing operational costs of business
etc. In this report two companies dealing in same sectors are taken so that the impact of change
on them can be determined. H&M is a Swedish multinational clothing retail company which is
renowned for its fast fashion clothing for men, women and children. Arcadia is a British
multinational retailing company headquartered in London, UK and it owns high street clothing
retailers Burton, Dorothy Perkins, Evans etc. In this report the impact of change on
organisations, drivers of change, barriers to change and how they impact leadership decisions
etc. will be discussed in detail.
Task1
P1) Comparison of impacts of change on organisations
Organisational strategies are the plans which are formed by the managers of company so
that long-term goals can be achieved effectively while organisational operations are the daily
activities which are carried out in a company so that company can work continuously towards
achieving its mission and vision. Implementing change in organisations affect both the
operations and strategies of companies differently so that they can minimise the negative impact
of change and gain a competitive edge in market.
Basis Arcadia Group Ltd. H&M
Political
changes
Impact: UK is a politically stable nation
however due to Brexit it might face
certain trade restrictions with EU which
can also impact the trade of Arcadia
company. The company might face loss
Impact: The changing political
conditions in UK due to Brexit can affect
the business of H&M in its market it is a
Swedish company and might face
restrictions in trading raw materials

of EU market along with the low cost
labour available from there which can
lead to increased cost of company (Beech
and MacIntosh, 2017).
Strategic changes: As the changing
political condition can increase the cost
of company it is important that the
company change its pricing strategy from
premium pricing to economic pricing so
that its sales can increase in the market
and help the company in being profitable.
Operational changes: The company can
improve its operation of selling and
increasing online sales so that it can also
reach to many customers.
along with effective dealing in the UK
market.
Strategic changes: The company can
improve its supply chain management so
that the raw materials can be efficiently
reached to its stores and the impact of
Brexit can be reduced. Improving the
delivery services of company can also
help it in attracting more customers
within UK.
Operational changes: H&M can
increase its online sales so as to reach to
a large number of customers in UK.
Technolo
gical
changes
Impact: With the increased access to
advanced technology the shopping
preferences of customers are changing as
they want more integrated experience of
shopping so that high customer
satisfaction can be achieved which
requires Arcadia to implement effective
changes (Dick and et. al., 2018).
Strategic changes: The company can
implement technology so that the
efficiency of business processes can be
increased while reducing the production
cots and time. Use of digital technology
can be done by the company so that
better experiences can be provided to
customer through AR and VR techniques.
Impact: With the increase in
technological advancements the
preference of customers for online
shopping is increasing along with
improved experiences. Also with the
advancement in technology the
competition in market is also increasing
as the competitors are coming up with
effective techniques to attract customers.
Strategic changes: The company can
bring strategic changes in the use of
technology so that it can be used
effectively in responding to customer
needs like providing offers on online
shopping, increased discounts etc. Also
the use of AI can be done to provide

Operational changes: Arcadia can use
technological advancements to improve
the marketing through omni-channel like
social media platforms, e-mail marketing
etc. Also the company can enhance the
experience of customers through its
online shopping applications (Doppelt,
2017).
better customer services thereby
improving their experience.
Operational changes: The company can
improve its operations in market with the
help of technological advancements as it
can help in better marketing facilities and
also in improving online sales of the
company.
M1) Different drivers of change
There are mainly two drivers of change which affect the company and leads to changes in
its strategies, policies, plans, designs as well as structures:
• Internal drivers: These are the internal factors of organisation which require change like
change in number of employees, direction and objectives of company, ideology of
workforce etc.
• External drivers: These are the external factors which lead to changes in the company
like changing customer needs, government laws, competitor tactic etc.
Types of organisational changes:
• Transformational change: These are the changes which completely alter the current
operating structure through change in processes, technology etc. of the company so that a
competitive advantage in market can be achieved.
• Remedial change: These changes are brought in company so as to improve the
performance of a company during certain conditions like financial distress by
implementing focused and urgent changes (Dorac-Kakabadse, 2017).
Task2
P2) Ways in which drivers of change affect leadership, team and individual behaviours
There are various internal and external drivers of change which can affect the
performance of an organisation by affecting the behaviour of leadership, team and individuals
which affects the ability of company in achieving its goals and objectives on time.
Internal drivers:

• Resources: These are the internal resources of an organisation like technological, human
and financial which helps Arcadia Group Ltd in performing its operations and functions
in an effective manner. Sufficient availability of these resources can help in giving
confidence to the employees so they can be utilised effectively in achieving company
objectives (Emmrich and et. al., 2015).
• Employees: They are the drivers of change as the requirement of new employees for a
task needs the company to recruit more employees leading to change in the configuration
of number of employees in company affecting the behaviour of leadership as the leaders
will change their styles depending on the workforce.
• Organisational culture: The culture of an organisation impact the way in which work is
allocated among employees and the work is one so that company goals can be achieved.
The leaders can bring change in organisational culture so that the goals of employees can
be aligned with organisational goals.
SWOT analysis: This tool can also be used so that the internal strength and weaknesses of
Arcadia Ltd can be analysed:
Strengths Weaknesses
 High brand awareness among
customers leading to large customer
base.
 Effective customer service for high
satisfaction (First, Kendler and
Leibenluft, 2017).
 The financial planning of company is
weak.
 Less investment in improved
technologies and innovations.
Opportunities Threats
 It can increase its sales through online
shopping.
 Expand its reach of customers in new
markets.
 High competition in the market.
 Changing customer needs and
technological developments.
External drivers:
• Government regulations: The change in governmental policies and legislations like tax
laws, trade tariffs etc. can impact the strategies and operations of the company which
requires that Arcadia brings effective changes so as to survive in market.

• Customers : The changing needs and wants of customers also lead to changes in
company strategies so that high customer satisfaction can be achieved by effectively
meeting the changing requirements of the customers.
PEST analysis: This is a strategic management tool which can help in analysing the external
factors which can affect Arcadia Ltd:
Political factor Economic factor
These are the factors related to governmental
rules and regulations which needs to be
followed by Arcadia so that it can operate
legally and save itself from penalties etc.
These are related with economic factors like
inflation rate, interest rate etc. These factors
must be analysed by Arcadia so that the goods
offered by company can be bought by its
customers.
Social factors Technological factor
These are the factors related with the people
and their preferences which depends on their
living standards. People in UK have high
standard of living which can help them in
purchasing fashionable clothes (Gupta, 2016).
The rate at which technological advancements
and R&D can take place in country can affect a
company's operation. UK is technologically
advanced which can help Arcadia in effectively
using new techniques to improve customer
satisfaction.
P3) Measures taken to minimise negative impact of change
There can be various impacts in an organisation through the introduction of change in its
existing policies and strategies which must be analysed so that the negative impacts can be
minimised:
• Employee engagement: It is important that the engagement of employees in decision
making processes are increased so that they can feel more committed towards the
company and help in implementing change efficiently so that their performance can be
improved and better results can be achieved by the organisation (Hayes, 2018).
• Effective communication: In order to effectively implement change it is important that
effective communication channels are used so that the flow of information can take place
smoothly and employees can feel motivated to adapt to changes. Also through improved
communication better exchange of information can take place so that the employees can

remain updated about the changes and the way in which they have to work so that
implementation of changes can take place effectively.
• Learning culture: The managers of Arcadia must create a learning culture in the working
environment so that the employees can be motivated to grow and develop through
implementation of change in the organisation. This can help the employees in their
personal and professional development and also motivate them to adapt to changes which
can help them in facing challenges effectively.
M2) Critical evaluation of response of organisation to change
Organisations can use various models and theories so that they can effectively respond to
changes and help the employees in adapting to these changes so that the objectives and goals of
company can be achieved and better competitive advantage can be gained. Arcadia Group can
use Bruke Litwin model which was developed by George H. Litwin and W. Warner Burke in
1960. This model help in establishing a cause and effect relationship and also help in
determining 12 elements which bring change in organisation (John Wiley & Sons.Salman and
Broten, 2017). In this model 4 elements group together and are presented in columns of which
the middle column forms the backbone of the model, left column has hard element which are
tangible and measurable while the right column has soft elements which are mainly abstract.
This model help in analysing the elements which can bring change so that their impact can be
determined and effective changes can be brought in the company.
D1) Conclusions and recommendations for planning for change
The change impact analysis was developed by Bohner and Arnold which help in
determining the extent to which changes can create impact on an organisation along with
estimating what needs to be modified so that changes can be accomplished. This analysis can
help in determining the effectiveness of change so that stakeholders can be engaged in change
implementation, effective communication can be established and learning development plans can
be formed. Following are the recommendations for Arcadia so that changes can be effectively
implemented:
• Monitor and manage resistance of employees in implementing change along with setting
budget for effective implementation of change.
• Increasing employee participation in decision making.
• Communicating effectively with the stakeholders who will be impacted by change.

• System theory approach can also be applied which states that organisations are open
social systems which must interact with external environment so that they can sustainably
survive in the market (Komives, 2016).
Task3
P4) Barriers for change and how they influence leadership decision-making
At the time of change implementation various barriers can be faced which needs to be
identified so that they can be removed through effective leadership decision-making:
• Unknown current state: It is important that a proper assessment of the current state of
Arcadia is done so that the extent to which changes are to be brought can be analysed so
that effective decisions can be made regarding the implementation of change.
• Lack of effective communication: It is important that effective communication is
established in an organisation so that changes can be implemented and all the stakeholder
can be involved in change implementation. The leaders need to use communication
channels which can help in involving all the stakeholders related with change
implementation (Lloyd, Boer and Voelpel, 2017).
• Organisational complexity: This is related with complexity in processes, products and
systems which can be a barrier to the implementation of change and affects the leaders
decision making as they have to make effective plans so that changes can be effectively
implemented in organisation.
• Lack of employee participation: If the employees are not involved in decision making ot
can act as a barrier in implementation of change. This affect the leadership decision-
making as the leaders can create a participative and learning culture in the organisation
which can help in effective inclusion of employees in change implementation.
M3) Force field analysis to analyse driving and resisting forces
In order to determine the forces which are driving change and the forces which are
resisting implement ion of change, Force Field analysis can be used so that effective decisions
can be made which can help in lowering the impact of resisting factors and maximising the
impact of driving factors. This can help in effective implementation of change in Arcadia Ltd so
that it can deal with the changing conditions and gain a competitive edge by gaining support
from the employees in adapting to change. If there is an equilibrium between the driving and

resisting forces then no change take place in an organisation. Thus with the help of this model
the impact of these forces can be analysed so that changes can be brought in the company
effectively.
Illustration 1: Force field analysis
Source: Force Field Analysis - Kurt Lewin. 2017
D2) Critical evaluation of force field analysis
The effective use of force field analysis can help the mangers of Arcadia Ltd in
determining the forces which can help in implementing the desired changes along with the forces
which are resisting change. This model can help the management in taking actions so that the
driving forces of change can be strengthened which can help the company in achieving its goals
and objectives and adapt to the changing environment. It also help in improving communication
among the staff members so that they can be involved in decision making thereby motivating
them to participate in change implementation through coordinated and integrated efforts. Also
this model can help Arcadia in improving the ability of its employees to adapt to changes which
are brought in the company (Lozano, Nummert and Ceulemans, 2016).

Task4
P5) Different leadership approaches in dealing with change
In order to achieve the organisational goals on time and to implement change in Arcadia
Ltd it is important that effective leadership approaches are applied by the leaders so that they can
direct the efforts, skills and talent of employees in bringing the desired change in company.
• Democratic leadership: This is a leadership style in which employees are involved in
decision-making and their participation can increase which help in motivating the
employees as their opinions and views are considered while making decisions. This can
also help in increasing employee engagement along with increased innovation through
improved and new ideas from various employees. This leadership can help in involving
employees in change implementation so that they can better adapt to the change
(Mukherjee and et. al., 2015).
• Transformational leadership: In this type the leaders work with teams to identify change
which are needed to be implemented so that improvement in company's performance can
be achieved. The leaders constantly encourage the employees to complete their projects
on time and come up with innovative and creative ideas so that company can achieve
success in a better manner and gain a competitive edge in market.
• Situational leadership: In this type the leaders adjust and change their leadership styles
so as to suit to the need of the situation so that they can be effectively dealt with. This
style can help the leaders in effectively dealing with situations so that maximum profits
can be achieved and better coordination among employees can be achieved so that
changes can be implemented effectively (Painter and Clark, 2015).
Apart from the effective leadership style which is chosen by the leaders it is important
that effective models of change are implemented by them in Arcadia so that change can be
efficiently implemented in the company:
Kotter's 8 step model of change: With the application of this model in an organisation
changes can be effectively brought in the company through establishing better vision so that they
can be communicated to all the stakeholder in the company. This is a step-wise process which
can help in effective change implementation which includes: creating urgency, building a team,
developing a vision, communicating the vision, removing obstacles, creating short term wins,
building the change and implementation of change effectively in organisational culture.

Democratic leadership style can help in effectively implementing change with the use of this
model so that the organisational objectives are efficiently achieved.
Lewin's three step model: This model was developed by Kurt Lewin so that change can
be effectively implemented in an organisation through the implementation of three steps which
are unfreezing, changing and refreezing. With the effective use of this model changes can be
implemented in Arcadia Ltd by its leaders. Unfreeze stage: at this stage the need for change is
ascertained, support is gained from the staff, strategies are developed for communicating about
the need for change etc. Change stage: at this stage change is implemented through effective
communication and engaging employees. Refreeze stage: At this stage the change is effectively
embedded in the organisation so that sustainability can be achieved through the implementation
of change. In order to apply this approach the leaders can use transformational leadership style
which can help in encouraging the employees to adapt to change in organisation (Sammut‐
Bonnici and Galea, 2015).
M4) Extent to which leadership approaches can deliver organisational changes
Leadership approaches play an important role in the effective implementation of change
in an organisation by integrating the efforts of employees in the direction of change so that they
can be motivated to adapt to changes in the organisation. It is important that effective leadership
style is adopted by the leaders so that they can help in achieving organisational goals on time
through increased participation of workers. Democratic leadership style is the most effective
style which help in increasing participation of employees so that they can be encouraged to
accept changes and use their skills in improving the performance of company through the
resulting change implementation.
D3) Critically evaluate the effectiveness of leadership approaches
Leaders play an important role in the effective implementation of change which requires
that a leadership approach is chosen which can help in integrating the efforts of workers so that
change can be implemented in company (Thomas and et. al., 2016). Various approaches can be
used by the leaders of Arcadia Ltd so that a participative culture can be built in the company
which can help in creating a friendly working environment so that changes can be accepted and
the resistance of workers towards change can be reduced. Democratic leadership style is the most
effective approach which can be used by Arcadia Ltd so that changes can be effectively
implemented in company by creating a participative working environment.

Conclusion
From the above report it can be concluded that various factors affect an organisation
which lead to changes in its operations and strategies so that it can survive sustainably in the
changing market. There are various internal and external drivers of change which lead to change
implementation in an organisation when they overcome the restraining factors. It is important
that certain actions are taken by the leaders of organisation so that the negative impact of change
can be reduced through employee engagement and effective communication. It is also important
that effective leadership styles are used by the leaders so that they can help in effective
implementation of change through increase participation of workers.

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