Leadership and Management Report: Fonterra Change and Innovation

This report provides a comprehensive analysis of leadership and management practices within Fonterra, a prominent dairy industry organization in New Zealand. It delves into stakeholder relationship management, exploring the importance of strategic relationships in facilitating change and innovation, and examines the consequences of poor relationship management. The report also addresses change and communication strategies, outlining reasons for change, short and long-term benefits, and innovation strategies. Furthermore, it investigates stakeholder engagement, staff motivation, and the role of managers in supporting change and innovation. The study highlights strategies for motivating stakeholders, supporting staff, and seeking feedback, while also assessing strategies for staff acceptance of change and ensuring self-motivation. The report utilizes Fonterra's Human Resource department as a case study, offering insights into effective leadership and management techniques in the dairy industry.

Running Head: LEADERSHIP AND MANAGEMENT
Leadership and Management
Student’s name:
Name of the university:
Author’s note

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Table of Contents
Introduction......................................................................................................................................4
Task1................................................................................................................................................4
Stakeholder relationship management.............................................................................................4
1. Research: Strategic relationship management and analyze its importance in facilitating change
or innovation in a business environment.........................................................................................4
2. Explain at least three consequences of poor relationship management skills on developing and
gaining support and cooperation on business decisions in your identified New Zealand business.5
3. Compare and contrast the characteristics of at least three stakeholder relationship management
techniques appropriate to your identified business..........................................................................6
4. Evaluate how each technique when applied, develops, motivates and gains support and
cooperation on business decisions...................................................................................................7
Task2................................................................................................................................................7
Change and Communication............................................................................................................7
a. Two reasons for the need for the change.....................................................................................7
b. Two short-term benefits of making the change...........................................................................9
c. Outline of at least two long-term benefits of making the change................................................9
Task Three.....................................................................................................................................10
Innovation and Communication....................................................................................................10
a. Outline of at least two reasons for the need for the innovation.................................................10
b. Outline of at least two short-term benefits of making the innovation.......................................11
c. Outline of at least two long-term benefits of making the change..............................................12
Task Four.......................................................................................................................................12

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Stakeholder's Engagement, Self and Staff Motivation and innovation.........................................12
1. Outline at least two ways stakeholders can assist and participate in the change or innovation
project............................................................................................................................................12
2. Outline at least two strategies the organisation will use to motivate all stakeholders by keeping
them informed during the process.................................................................................................13
3. Outline at least two strategies the organisation will put in place to support and motivate staff
seeking help and explanation concerned with the change.............................................................14
4. Outline at least two strategies the organisation will use to motivate staff by seeking
stakeholder feedback.....................................................................................................................14
5. In maintaining stakeholder engagement assess.........................................................................15
a. At least two strategies managers can use to assist stakeholders to participate fully in the
change............................................................................................................................................15
b. Two strategies managers can use to keep all stakeholders informed during the process..........15
c. at least two strategies managers can put in place to support staff seeking help and explanation
over concerns with the change.......................................................................................................16
d. At least two strategies managers can use to seek stakeholder feedback....................................16
6. In maintaining self and staff motivation, assess........................................................................17
a. Two strategies managers can use to assist staff acceptance of change or innovation...............17
c. Two strategies managers can use to ensure self-motivation and self-development during the
change............................................................................................................................................18
d. Two strategies managers can use to monitor staff motivation during the period of change.....18
Conclusion.....................................................................................................................................19
Reference List................................................................................................................................20

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Introduction
In this study, the main focus will be on the leadership and management. Leadership
strategy is needed in order to increase the productivity of the organisation and making the
smooth flow of the organisation (Renz, 2016). In this study, there are four aspects have been
given to analyse. In the first part of the study, the main focus has been on the stakeholder
relationship management and the second section of the study focuses mainly on change and
communication. In addition, the third part of the study focuses mainly on the innovation and
communication. Moreover, the fourth part of the study focuses on the self n staff motivation and
innovation. In order to continue the study, Fonterra organisation has been chosen and it is in the
dairy industry. In the New Zealand, Fonterra is one of the famous organisations in dairy sector
(Fonterra.com.nz, 2017). Moreover, in Fonterra organisation, Human Resource department has
been chosen for the change and HR department is very important for any organisation.
Task1
Stakeholder relationship management
1. Research: Strategic relationship management and analyze its importance in facilitating
change or innovation in a business environment
Strategic relationship management or the stakeholder relationship management is one of
the most important aspects of the present day business scenario. Fonterra in New Zealand is a
famous dairy product industry which is also no exception. Maintaining a good and healthy
relationship with the customers is very much essential in bringing about innovation and
sustainability in the business organization (Shymko & Roulet., 2017). If the customers are

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satisfied with the service they may suggest for many new and better improvements that they are
looking for in the organization. The consequences of poor relationship management can have
many harmful impacts on the entire business (Kim & Krishna., 2017).
2. Explain at least three consequences of poor relationship management skills on
developing and gaining support and cooperation on business decisions in your identified
New Zealand business.
Lack of proper coordination
There has to be the feeling of mutual understanding among each and every employee
working within an organization. If there is no transparency among the employees then, they will
naturally be hesitant in sharing any information with each other. This will hamper the overall
production of the Fonterra Company in the long run (Bell & Roebuck 2015).
Frequent leaves from work leading to the lack of proper discipline
If there is a lack of proper relationship management, then all the stakeholders including
the employees will have no regard for any kind of rules and regulations set by the company. This
will happen because either the employees will misunderstand their superiors or vice versa. Apart
from this the employees will also have several conflicts within them and will resent each other’s
company. As a result of which they will take leaves and avoid coming to office. This will
hamper the production a great loss of a strong customer base
Loss of customer base
If there is the lack of a proper customer relationship management then the process of
customer retention will be a big problem. However, the customers are always looking for some

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additional benefits like good behavior, friendliness of the staffs, and timely delivery of the
products. If all these are absent from the side of the company, the customers will be dissatisfied
and will easily switch over to other companies (Kim & Krishna., 2017).
3. Compare and contrast the characteristics of at least three stakeholder relationship
management techniques appropriate to your identified business
Aim to build strong relationship
Fonterra Company must try to build a very strong relationship with all the stakeholders
by sharing with them the vision of the company (Good, Borba & Maragno., 2015). In order to
encourage them, the stakeholders are to be given a view of what success would look like in the
long run. However the company must also take care of the privacy. This can so happen that some
of the stakeholders might give away the valuable business tips to other competitors.
Seeking advice and attention from positive stakeholder
The company must try and seek attention from the stakeholders who are more positive
and can influence the business in a better way. Peer learning and peer influence can also be used
as a part of the stakeholder relationship management techniques. Meeting with the key
stakeholders regularly
Holding meetings with stakeholders on a regular basis
Meeting with the key stakeholders on a regular basis will help to gain a lot of information
about their concerns and also taking into account the important tips that they might like to share
(Jarle et al .,2014). The same can then be incorporated into the business for improving the
performance. Fonterra can hold regular meetings with the local farmers or the veterans so that

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they can get the best fodder and medical aids for their cows, which will ultimately help to deliver
healthy and pure products.
4. Evaluate how each technique when applied, develops, motivates and gains support and
cooperation on business decisions
a. Building strong relationship will enable the stakeholders to interact with each other and
also develop a feeling of mutual understanding. They will be comfortable in dividing the
workload and the production will thus be boosted up (Waligo et al., 2013).
b. Maintaining a good relationship with the positive stakeholders will help the company to
gather all the important business tips that will eventually benefit the business in the long
run.
c. Regular meetings with the stakeholders will help the company to gather all the concerns,
business ideas, issues and feedback from the stakeholders. Prior action can be taken on it
as well.
Task2
Change and Communication
a. Two reasons for the need for the change
One of the important changes needed is in the HRM department related to the
communication of the stakeholders. This change is needed for
The proper circulation of the information within all the departments

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The communication is becoming a major problem because the employees come from
many different socio-cultural and linguistic backgrounds. As a result of which they feel hesitant
to talk with one another or are often biased to mix with the other employees coming from so
many different backgrounds. Hence, this communication gap creates a huge problem in the
coordination among the employees (Good, Borba & Maragno., 2015). They are also very much
reluctant in sharing their knowledge with one another. Apart from this, they often have
superiority and inferiority complexes growing within them. They can often develop very
negative opinions about one another or keep on suffering from a feeling of competitiveness that
will not only ruin their mental peace but will lead to severe conflicts. This will hamper the
employee morale a great deal. All these eventually will affect the total production of the
company. Hence, the Hr managers must induce proper communication within the stakeholders. It
is only through proper interaction and communication that they can slowly overcome their
cultural differences and work together as a team.
To avoid the lack of innovation
As a result of the lack of proper communication, there is often a casualness seen from the
part of the employees towards the efficient handling of the projects. There will be a lack of the
proper and timely transfer of messages within the organization. As a result of this, gathering all
the innovative ideas at a single place will become a major issue. This will eventually hamper the
overall production of the company. The company will not be able to provide good quality
products. As a result of which it will earn a bad name. Hence proper communication has to be
initiated by all the stakeholders so that proper innovation can be brought to the organization.

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b. Two short-term benefits of making the change
Creating an engaging workplace
The initiation of proper communication among the stakeholders will definitely help in
creating a very active and engaging workplace. For the employees to work efficiently there is the
need for a proper, healthy and active ambience (Bourne, 2016). Proper communication will
make the employees open up and interact with each other easily. There will be a free flow of I
formation and the process of knowledge sharing will also be increased. Overall the workflow
will become much more active and accurate within an engaging business environment.
The drive for purpose
It is very important for Fonterra Company to communicate the performance and the
achievements of all the employees on a regular basis. This communication can take place in the
form of verbal or even non-verbal form. This can be posted online or individually detailed to the
stakeholders. In order to encourage the employees, they are to be shown the details of their
performance and achievements. This will make them feel valued within the organization and
they will recognize their areas of improvements and can also utilize their strengths in order to
increase the efficiency.
c. Outline of at least two long-term benefits of making the change
Communication within Fonterra organisation will help in building a team within the
workplace. In Fonterra, the communication was not easy in previous time as there was no such
intranet software within the workplace that can manage the communication flow within the
organisation. Moreover, in long-term, the team building process will be easier in effective
communication within the organisation as effective communication can increase motivation and

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satisfied the job roles within the team (Deci & Ryan, 2014). Effective communication can reduce
the competition within team members and they can work harmoniously.
In global business expanding, Fonterra has been in the field of the global market as the dairy
production of the organisation is high. However, the global business process will be hard if the
communication flow gets hampered. In implementing the technologies and intranet software, the
employees from all over the world can communicate perfectly without any pressure. The
organisational management can send any news through intranet software and communicate to all
employees (Ronen & Mikulincer, 2014). The difference in culture is another issue in having the
communication gap, however, the organisation is thinking of diversity training to the employees.
Increase in communication flow can help Fonterra to have global business in long-term.
Task Three
Innovation and Communication
a. Outline of at least two reasons for the need for the innovation
In managing the human resource, the Fonterra organisation can increase the competition
in the industry. This competition can help the organisation to encourage the employees to work
on the field in which they are in. Prediction of competition for the organisation should be high
and employees must do this in order to produce innovation in work. Competition in the industry
can bring smart and faster employees who know how to do the work effectively and
innovatively. In the industry of dairy production, Competition in the market is high and it can
increase the innovation cycle and that can lower the burden of the employees. Innovation in the

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workplace can be facilitated in Fonterra by the employees and through innovation, the workplace
will become shorter, moreover, the employees could do the work repeated basis and quickly.
Innovation is needed in the dairy industry as the globalisation has entered in the New
Zealand market. The world is shrinking just because of globalisation and the organisation sent
the dairy products in other parts across the world. In order to survive in the global market,
innovation is needed. Changing the global market can provide an opportunity for the business to
innovate and taking advantage of this (Keytone et al., 2013). National boundaries in the business
have fallen away and the Fonterra is trying to manage the business in global perspective also. In
supply chain management, the organisation is needed to focus on innovation that can help to
expand the business in a global circle as well. In order to thrive in the global environment,
innovation in leadership, management, logistics and business processes are needed (Eisenberg,
Goddall & Trethwey, 2013).
b. Outline of at least two short-term benefits of making the innovation
In Fonterra’s perspective, the organisation must go for innovation in human resource
department; it can bring the improved productivity of the organisation in short term. In Fonterra,
the organisation has introduced new technologies in the workplace and it has improved the
productivity of the organisation. Innovative technologies may increase the costs in first time,
however, it can improve the productivity in a daily basis. The employees can complete the work
in short time and it can increase the profitability of the organisation Fonterra.
In implementing the change in innovative technologies in the organisation and Fonterra also has
improved the workplace culture as well. This could result in the better quality of work within the
organisation and the organisation can improve the quality dairy products. Better quality products

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can meet the customers’ needs and this innovative strategy can improve the profitability and
sales of the organisation (Karanges et al., 2015).
c. Outline of at least two long-term benefits of making the change.
On long-term basis, the organisation Fonterra can add more values to improving the
Unique Selling Proposition (USP) and USP is considered to be the innovation of the
organisation. Fonterra is in the dairy products and the organisation can offer new types of dairy
products through differentiation. The customers can pay more if they find the products meeting
the desired and help the business to flourish in long term.
Innovation within the organisation can increase the staff retention in long-term. Fonterra
organisation has changed in the technology sector and it will lower the pressure of the
employees. This may result to increase in staff retention if the organisation provides sufficient
support to the employees. Potential recruitment by the organisation can foster the innovation
within the organisation as the employees would become skilled (Wheelen & Hunger 2017).
Task Four
Stakeholder's Engagement, Self and Staff Motivation and innovation
1. Outline at least two ways stakeholders can assist and participate in the change or
innovation project.
Stakeholders of the organisation Fonterra can assist the organisation in gaining the help
from the sponsors. In accessing the sponsorship from the investors, stakeholders can help the
management. In the senior level of the employees, they can arrange the sponsorship in both

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internal and suppliers as well as customers’ perspectives. In accessing the sponsorship, the
stakeholders can participate in the change process to define the scope of the change and
engagement programmes (Ward, 2016).
Throughout the change process, the organisation Fonterra can ask the stakeholders to
involve in the change management process in communication and implementing innovation. In
Fonterra, the stakeholders are employees, management, government, supply chain and
customers. The involvement of the stakeholders helps the organisation in ensuring the
effectiveness of intentional exclusion of the illegitimacy (Goetsche & Davis, 2014). Moreover,
the engagement plan of the organisation should be appropriate enough that can help the
stakeholders to get involved and organisation can get right outcomes through this.
2. Outline at least two strategies the organisation will use to motivate all stakeholders by
keeping them informed during the process.
In Fonterra organisation, the stakeholders can belong to other countries also, in this
scenario; the strategy to motivate the stakeholders is to keep the track of the stakeholders through
meeting the organisation's outcomes. Focusing on the stakeholders' need is a great deal of power
for the management and influence the stakeholders by putting opportunity option can motivate
the stakeholders. As stated by Nahavandi (2016), there should be a gain to the stakeholders in
planning and it can motivate them to involve.
In addition, the management can start the educational meeting and informational
meetings with different stakeholders that provide them with the idea of the changes.
Incorporating the motivational tone to the stakeholders can help the organisation to engage more
stakeholders and stakeholders can get excited to be a part of the changes in the organisation.

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3. Outline at least two strategies the organisation will put in place to support and motivate
staff seeking help and explanation concerned with the change
The management must listen to the employees about their views on changes and deciding
actions after listening to the staffs can motivate the employees (Carroll & Buchholtz, 2014). In
Fonterra organisation, the management does not listen to the staffs and they need to take the
action having listened to the staffs’ consideration in flexible work, policies and attitudes of the
management. The changes can bring the newness work culture and the employees can ask for the
training, participation and development.
Training could be a motivator for the staffs as the employees may think that the change
processes may bring issues to them. Activists’ employees like to take new experiences, whereas
the theorists are comfortable with the theories and concepts. Learning preferences of the
employees should be known by the management and provide training according to the necessity
of the employees can improve the work process. According to the learning preferences, the
suggestion and stimuli need to be given to the employees.
4. Outline at least two strategies the organisation will use to motivate staff by seeking
stakeholder feedback.
Stakeholders' feedbacks can help the organisation Fonterra by understanding the project
changes. Fonterra's management can use the stakeholders' feedbacks and these feedbacks will
make the things clear. Making the things vivid can make the work easy for the employees. The
easy working process can motivate the employees also. The changes will be based on the
innovation and the communication process within the organisation and clear communication can
motivate the employees through intrinsic ways (Ward, 2016).

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Stakeholders' must talk about the changes and manage the changes is not easy. In managing the
change, people can be motivated within the workplace as this change will bring comfort to the
employees. In order to bring success for the changes, the organisation can give external
motivation to the employees as well.
5. In maintaining stakeholder engagement assess
a. At least two strategies managers can use to assist stakeholders to participate fully in the
change
Managers can ask the stakeholders to provide feedback on the changes after the change
process is over. This feedback policy can help the organisation to get engaged the stakeholders in
the change process. Management does know that this feedback process is related t the support of
the stakeholders within Fonterra organisation (Renz, 2016).
Stakeholders can participate in the change management process if they get any benefits
from the management. The managers need to ensure the benefits of the stakeholders and they can
engage in the change management process. At the first occasion, the managers need to remove
the demotivators in the change process and approach to the stakeholders.
b. Two strategies managers can use to keep all stakeholders informed during the process.
The managers of Fonterra can use the social media software in order to keep the
stakeholders informed. Social media software helps the organisation to put the news and
information that are required to inform the stakeholders and social media can be accessed by all
the stakeholders. Those who do not use social media can be sent emails for the communication
purposes.

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In change management process, the organisations can update the notice board within the
workplace and that would help the stakeholders to get in touch with the stakeholders (Wheelen,
2016). The notice board updating can be helpful for the employees and stakeholders to get the
information and would be supportive of the employees.
c. at least two strategies managers can put in place to support staff seeking help and
explanation over concerns with the change.
Meeting with the staffs can help in explaining the process of changes and the formal
meeting can be assistive to the employees to know the reason behind the changes. The
supporting staffs in change process should be informed of the changes and this can be managed
through the informal and formal meetings of the employees. Team leaders can arrange the
meetings in Fonterra to let the members understanding of change process.
When staff seeks help in the change process, the organisation can arrange an On-the-Job
training for the staff. It helps the staff to gain knowledge in which field they are seeking filed.
This training process helps the people to be efficient in work, face the challenge and gain the
knowledge (Karanges et al., 2015).
d. At least two strategies managers can use to seek stakeholder feedback
Stakeholders’ feedback can be gathered through the survey questionnaire and survey
questionnaire can be shared through emails. This survey process can intervene the valuable
insights of the stakeholders (Deci & Ryan, 2014). Fonterra organisation can set a close-ended
questionnaire to have the answers of the stakeholders.

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Consult the stakeholders through face-to-face can help the managers to gain knowledge about
the change. However, a face-to-face interview is a lengthy process, on the other side, this can
provide multi-faced approaches in analysing feedbacks.
6. In maintaining self and staff motivation, assess
a. Two strategies managers can use to assist staff acceptance of change or innovation
The managers can audit the staffs' mentality whether they accept the changes or they just
do not like the changes. Positive feedback from the employees will show that they will accept the
changes or innovation. Changes in the organisation must bring positive perspectives from the
employees' sides also.
The managers can start a new motivation policy through an increase in staff remuneration
in Fonterra and this increase in salary will make the staff accept the change. Monetary increment
provides motivation from the inside and the management can use this in order to accept the
changes (Ronen & Mikulincer, 2014).
b. Two strategies managers can use to improve employee motivation through engagement
and productivity to achieve strategic objectives.
The managers in the organisation can suggest the management to start a bonus system
through monetary benefit in order to engage the people in increasing the productivity. Extra
bonus or incentives can motivate the employees to give organisational productivity in Fonterra.

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In addition, promotion in the workplace can bring motivation for the employees.
Moreover, the organisation can promote the employees so that they could feel values for the
organisation and hence the motivation increases (Eisenberg, Goodall & Trethewey, 2013).
c. Two strategies managers can use to ensure self-motivation and self-development during
the change.
During the change, the employees can get self-motivated by judging what kind of
benefits they could get whenever the process of change will be finished. Intrinsic motivation
comes from workplace culture also. In human resource department, the culture of work should be
friends that can provide support to the employees (Nahavandi, 2016).
The employees must feel interested in doing the work and the interest and enthusiasm can
give the self-motivation in the workplace. Managers can ensure the enthusiasm by providing
extra workload and judge whether the employees like to take extra workload or not.
d. Two strategies managers can use to monitor staff motivation during the period of change
The managers can calculate the response of the feedbacks what the employees provide in
feedback forms. This Key Performance Indicator (KPI) form can justify the motivation factors of
the employees (Renz, 2016). Fonterra organisation can start the KPI in order to monitor the
staffs’ performances and determine the level of satisfaction of job.
In addition, the team leaders and managers can go through the enthusiasm within the
workplace among the employees and they can understand the motivation level. The employees’
absenteeism can make clear the fact they are experiencing the motivation or challenges,

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Conclusion
It has been observed that Fonterra is a large organisation that gives the employees enough
scope to flourish. However, the organisation has been facing the issues in communication and
innovation in the Human Resource department. The organisation has been going through the
changes in the communication process and it is going to change the process of communication
from top-to-bottom to horizontal. In addition, managing the organisation needs improvement in
some of the basic spheres of the organisation. Moreover, the process of changes are included
with the stakeholders of the organisation Fonterra and leaders will make aware the stakeholders
of the facts and staffs need to be motivated in order to bring the changes.

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