Organizational Change and Leadership Effectiveness

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Understanding and Leading Change
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Table of Contents
Introduction......................................................................................................................................3
Task 1: Managing the Impact of Change.........................................................................................4
Part A: Responding to Change........................................................................................................4
Assess the different drivers for change using a range of real-world examples to support your
answer..............................................................................................................................................4
Using the organisations, you have included for your examples, compare how each of the
organisations have responded to the drivers for change, considering similarities and differences
in each organisation’s approach to dealing with change.................................................................5
Part B: The Impact of Change.........................................................................................................7
Evaluate the ways in which the internal and external drivers of change may affect the leadership
behaviour, and the behaviour of the teams and individuals.............................................................7
Evaluate measures that can be taken to minimise the negative impacts of change on
organisational behaviour..................................................................................................................8
Apply appropriate theories and models in order to critically evaluate organisational response to
change..............................................................................................................................................9
Conclusion and recommendations...................................................................................................9
Task 2: Leadership Decision Making............................................................................................10
In relation to your selected organisation, produce a force field analysis that identifies the driving
and resisting forces associated with change..................................................................................10
Explain the different barriers for change.......................................................................................11
Analyse the driving and resisting forces to determine how they influence leadership decision
making within your selected organisation.....................................................................................12
Task 3: Leading Change................................................................................................................13
Apply different leadership approaches to dealing with change in a range of organisational
contexts..........................................................................................................................................13
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Evaluate the extent to which leadership approaches can deliver change effectively....................14
Conclusion.....................................................................................................................................15
Reference List................................................................................................................................16
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Introduction
Change management is a crucial part of business growth and improvement. The business
marketers are engaged in continuous improvement of the business procedures, which are helping
the marketers to improve its financial and other performance, thereby enhancing growth and
others potential of the business. In this regards, it is noteworthy that there are several factors,
which are affecting the growth of the organization through change, including internal and
external factors. In this context, leadership is playing a crucial role. The following assignment is
going to emphasize upon understanding the drivers of change and role of leadership in this
phenomenon, while exploring different theories and models related to change and leadership.
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Task 1: Managing the Impact of Change
Part A: Responding to Change
Assess the different drivers for change using a range of real-world examples to support
your answer
Change is referred to the systematic process of transforming system, process or object.
Organizational change could be of different types, based on the needs; which includes “structural
change, strategic change, process change, people change, planned change and emergent change”.
Different types of drivers can influence change in workplace. It is defined as significant
disruptive force, which could be presented in the most or all change scenarios, which are
promoting the change procedure. These drivers could lead to change in the organizational
capability or system design. For instance, the external change drivers are forcing the organization
to consider the market trends, in order sustain in the industry. Such changes cannot be controlled
by the company (Renz, 2016). Some key examples of the external drivers of change for an
organization includes competition, technology, changing customer trends or needs, demand and
supply chain and change in economy stability of the nation. On contrary, the internal driver of
change indicates the factors, which are residing within the organizational context, influencing the
change procedure. For instance, issues or problems, leadership and vision, resources and
capabilities are key internal drivers for change.
In this regards, it is noteworthy that most of the established organizations in different fields have
undergone change, for promoting growth and sustainability of the business. For instance, in case
of Tesco, the retail giant UK, has undergone change, by the influence of its internal change
driver, i.e. financial loss faced by the organization in 2015, a “statutory pre – tax loss of £6.4
billion for the year”. In addition, entry of SMEs in the market, with increased market share of
competitors like Aldi also act as external driver for Tesco, to implement change in operation and
strategic business change (Armstrong, 2016). On the other hand, the changing consumer
preference is also an external driver for Tesco, as consumer attempted to shift towards discount
retailers like Aldi. On the other hand, in case of the renowned telecommunication brand Nokia,
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the organizational change related to the development of strategic partnership with Microsoft in
2011 was mainly driven by external factor, like huge popularity of Apple iPhone among the
target population. On the other hand, following significant decline in sales, Marks & Spencer has
made change in its supply change. It has closed 24 stores, which was driven by the financial loss
and change in trading structure, which is more effective.
Using the organisations, you have included for your examples, compare how each of the
organisations have responded to the drivers for change, considering similarities and
differences in each organisation’s approach to dealing with change
Considering the drivers of change encountered by each organizations, which has been
demonstrated above, it has been revealed that different organization has responded in different
ways towards the change. The example organizations, Tesco and Nokia implemented change, in
response to change drivers, but impacts were dissimilar. For instance, in case of Tesco, the
organization has successfully identified the root cause behind the conflict and the need for
change. It identified that competition is the key driver of change, based on which it identified
that a thorough market research is crucial to know the competitors and implement change for
doing better (Bolden, 2016). Considering the actual reason behind market loss and increasing
competition, it introduced new product line, a strategic change; introduced more digital
marketing to grab consumers’ attention, a process change and emphasized upon regaining lost
trust of customers, by customizing media. As a result, they sales and profit return increased
highly, i.e. £162 million profit return on £48.4 billion of sales. Dave Lewis emphasized that
emphasizing upon customers through price cut and customer service availability helped the
business to sustain.
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Figure 2: Tesco Financial Performance
(Source: Vizard et al., 2016)
On contrary, in case of Nokia, approach of Nokia for dealing with change was different. Nokia
sensed the need for change in late period, when people were already fond of Apple iPhone. The
key issue was that the brand only emphasized upon products and service quality, instead of
conducting a thorough market search on changing consumer preferences. Upon partnering with
Microsoft, the organization attempted to offer Windows based smartphones to customers, instead
of symbian platform, with a purpose of competing out Apple iPhone. In response to the change,
Nokia planned rescale operations by reducing devices & services. In addition, Nokia also
planned to pursue several planned measures, cessation of some R & D projects, closure of some
facilities in “UK, Germany, Canada and Burnaby” and closure of manufacturing plants in Salo,
Finland (Muller and Turner, 2017). However, finally the brand could not be saved, as the
popularity of Apple iPhone was already high to the customers and there was lack of marker
research on consumer preferences.
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Figure 1: Nokia Phones Operating Margin
(Source: Muller and Turner, 2017)
Part B: The Impact of Change
Evaluate the ways in which the internal and external drivers of change may affect the
leadership behaviour, and the behaviour of the teams and individuals
The internal and external drivers are affecting change in the organization significantly. In both
the examples discussed above, Nokia and Tesco, the internal and external drivers have affected
the leadership behaviour, which have further influenced and shaped the organizational and
team’s behaviour. In case of Tesco, it has been revealed that as a result of change driven by the
internal and external drivers of change discussed above, the organizational structure became
decentralized, which has significantly affected the leadership behaviour, teams and individual
organizational behaviour in the organization. For instance, the decentralized structure shaped
management’s emphasis upon leadership and team development. Leaders influenced the teams to
rely more upon new opportunities, while embracing innovation, for increasing efficiency and
improving their commitment towards the objectives (Appelbaum et al., 2015). Managers
attempted to establish open communication network for improving employee’s attitude and
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acceptance towards change, with increased commitment. Decentralized structure promoted
participative leadership, which promoted satisfaction and commitment in individual as well as
teamwork. For meeting customers’ expectations, teamwork became the key for the Tesco
employees, which has also been integrated in their core values.
On the other hand, in case of Nokia, the structure of the organization, in response to the change,
became centralized. The managers became more responsible for making the right decision and
shape the organizational behaviour. The decision making considered the local or national teams,
instead of only relying upon centralized senior management team. Although the leadership
impacts attempted to give a new direction to the organization, to the team; but, it neglected the
needs for the employees (Hayes, 2018). As a result, it became difficult to sustain the failure
further. The results led to lay off of 4000 employees, moving from the manufacturing unit in
Mexico and Europe to Asia. The decision was made centrally, without involving employees,
without giving them the opportunity to get other employment, thereby dissatisfying them,
affecting the individual or team’s behaviour and spirit negatively.
Evaluate measures that can be taken to minimise the negative impacts of change on
organisational behaviour
Through applying several measures, the negative impacts of change on organizational behaviour
could be minimized. The most appropriate measure that Nokia should taken into consideration, is
establishing a transparent communication network in the organization. The managers and leaders
could undertake appropriate step to engage the employees in major decision making, listen to
their voice, so that they could feel that they are valued in the organization. It could significantly
improve the organizational behaviour and their commitment. In this regards, using
transformational leadership style by the leaders could also influence the fellows and teams to
understand the urgency of the situation and the benefits they could gain from the situation. In this
context, it has been revealed that it would also improve the organizational culture, which is
associated with shaping the organizational behaviour (Doppelt, 2017). On the other hand,
following the change management theory like Kotter’s 8 step model could also help the leaders
to identify the systematic way to influence organizational behaviour positively.
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Apply appropriate theories and models in order to critically evaluate organisational
response to change
System theory could be applied for evaluating organizational response to change. It is
investigating how the organization should evaluate the workflow efficiency. The system theory
indicates that several factors could affect organizational response to change, as identified in case
of Nokia and Tesco. The theory views the organization as energetic input-output system, where
the system is activated by the output of energy. In this regards, it is noteworthy that organization,
as a system, is categorized with two components, social and technical. The social component
includes people and technical one includes machines, technology, innovations. If the social
component does not work properly, the change would not be implemented successfully
(Hornstein, 2015). Therefore, evaluating the response to change aligning with this theory, it is
revealed from above analysis that Tesco has considered the need for its social component and
emphasized upon both innovation and employee’s commitment towards customers, which made
the change successful. However, lack of integration of these two components has been identified
in case of Nokia, which led to failure of the change implementation process.
Conclusion and recommendations
From the analysis, it can be concluded that both internal and external drivers are important for
the organization to be considered, while implementing change successfully. In order to do this,
organizations must consider the social component, i.e. leadership and management of employees,
as they would facilitate change procedure. Doing this, Tesco gained success in the change
procedure, but lack of effective management led to failure at Nokia. In this regards, it is
recommended to the organizations that while planning and implementing change in the
organizations, they must follow effective change management theory or framework. In addition,
the organizations are also recommended to communicate the change with employees and
consider their need for ensuring successful implementation of the change in the organization.
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Task 2: Leadership Decision Making
In relation to your selected organisation, produce a force field analysis that identifies the
driving and resisting forces associated with change
Marks & Spencer is a British retailer, which has been categorized as one of the largest retailer in
the world. It has a strong brand image in the market. However, due to some recent downturn in
sales and overall business profit of the retail giant, the organization has decided to implement
significant change in its business. In this context, for identifying the key driving and resisting
forces for the change, the force field analysis has been conducted for the organization.
Figure: Force Field Analysis
(Source: Toves et al., 2016)
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This tool was developed by Kurt Lewin, for analyzing different forces affecting a proposed
change, during implementation. In this regards, the model has been demonstrated for M & S
below.
Proposed change – Considering the ineffective supply chain, sales and marketing outcomes, it is
proposed to reinforce the internal organizational system.
Forces for change – Several forces could support the change implementation. For instance,
ineffective inventory supply for meeting customers’ need; requirement for increasing revenue
and profit margin; change in consumers’ preferences and trends towards retail goods are
influencing change. In addition, new digital technologies are also becoming available for
marketing, supply chain and operations with greater efficiency, which would have low
maintenance cost (Shrivastava et al., 2017).
Forces resisting change – There are some factors also, which could hinder the change
implementation also. High cost for change implementation in different domain, resistance from
staffs and environmental impacts could significantly hinder the change implementation
successfully.
Explain the different barriers for change
There are different barriers, which could significantly create barrier, for implementing change in
Marks & Spencer, which are explained below.
Ineffective leadership – If the leaders in the organization are not effective in leading and
managing the change, the procedure will ultimately lead to failure. It is because; leaders are the
one, responsible for influencing fellows and implementing the change procedure in the
systematic way. The leaders at M& S are not possessing effective leadership skills and style for
lead successful change management, creating barrier (Harrison, 2017).
Uncertainty – It is a key barrier faced by the M & S, in terms of bringing change, especially in
regards, to resource allocation and decision making. In order to make the proposed change in the
business structure, the leaders and managers need to undertake risk, while analyzing the benefits
from the proposed plan. However, the risk or uncertainty in decision making could hinder change
implementation significantly (Hornstein, 2015).
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