Leadership Challenges and Ethical Issues in Organisational Change

This report analyses the leadership challenges faced during organisational change, focusing on ethical issues, stakeholder impact, and relevant theories. It examines the challenges leaders face while implementing changes, including employee resistance and maintaining a competitive advantage. The report also discusses the impact of change on stakeholders, contrasting the rights, values, and practices of all parties involved to identify conflicts. Ethical issues faced by leaders during change, such as convincing employees and managing negative consequences, are also explored. The application of Lewin’s change theory is discussed as a tool for analysing and understanding the problems related to changes. The report concludes by emphasising the importance of smart leadership decisions for effectively implementing changes.

Running head: ORGANISATIONAL CHANGE MANAGEMENT
Organisational Change Management
Name of Student
Name of University
Author Note

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ORGANISATIONAL CHANGE MANAGEMENT
Table of Contents
Introduction...................................................................................................................2
Purpose of the research............................................................................................2
Research aim............................................................................................................2
Research objective....................................................................................................2
Research question....................................................................................................2
Literature review...........................................................................................................2
Analysis of leadership challenges.............................................................................2
Impact of change on stakeholders............................................................................3
Contrasting the rights, values and practises.............................................................3
Ethical issues faced by leaders.................................................................................3
Reference.....................................................................................................................4

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Introduction
The aim of the proposal will be to analyse the leadership challenges that can
be faced by an organisation. The focus of the proposal is on the challenges that
leaders face while implementing changes in an organisation.
Purpose of the research
The purpose of the proposal will be to ensure that leadership theories are
implemented in an organisational scenario so that proper understanding of the
leadership factors can be understood. Thereby, examples will be provided of various
companies that have applied leadership for gaining success in the market
Research aim
The aim will be to identify the leadership challenges that are faced by an
organisation by taking into consideration the ethical issues, rights, values and any
theory required for becoming a successful leader.
Research objective
 To identify the challenges faced by leaders
 To analyse the theories that can help in bringing about changes in an
organisation
 To understand the ethical issues that needs to be followed by the leaders
 To recommend changes in the leadership tactic of an organisation
Research question
 What are the challenges faced by leaders?
 How can the theories help in bringing about changes in an organisation?
 What ethical issues need to be followed by the leaders?
 What changes can be recommended in the leadership tactic of an
organisation?
Literature review
Analysis of leadership challenges
According to Fairhurst and Connaughton (2014), changes in an organisation
need to be brought about mainly so that a competitive advantage can be gained in
the market. However, changes as well as adapting to the applied changes may have
chances of failure in an organisation. This is mainly because the employees feel less
secured while working in an environment that are different from the one in which they
are used to working.
Jaskson and Parry (2011) are of the opinion that organisations tend to focus
on cultural changes so that a multi-cultural environment can be formed. One of the ill
effects of changes being made in an organisation is that employees may be de
motivated. This may hamper the stability in the business and provide competitive
disadvantage for the organisations. Companies like Nokia needed to change by
letting Microsoft acquire the company so that it can maintain its success in the
business. At the same time, leaders have to face challenges while setting up a team
as the team composition is essential in determining the success of a particular
project. Hence, the impact of changes on the stakeholders can be further analysed.

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Impact of change on stakeholders
Changes in an organisation may have a severe impact on the stakeholders.
As observed by Applebaum et al. (2010) the stakeholders take into account the best
interests of an organisation. They provide support to the managers so that they can
continue with their activities in an effective manner. Therefore, certain changes in an
organisation need to be highlighted to the stakeholders so that future decisions taken
by them can align with the current policies that exist.
The impact of sudden changes may hamper the stakeholders to continue with
the effective support it provides. For example, it is necessary that the changes do not
affect the culture of an organisation for which it is recognised in the market. In the
case of the scenario provided the stakeholders of the company believing that two of
the departments need to close the raised issue.
Contrasting the rights, values and practises
The major conflict that exists in the scenario provided is mainly on the closing
of two departments. As stated by Camillus (2008) it is necessary that companies
take drastic steps so that proper engagement of the employees in every department
can be maintained. It is important that the strategies adopted by the companies be
aligned with that of the interests and policies of the stakeholders. It has been
evidenced that reputed companies like Microsoft as well as Nokia suffered to gain
clients despite the changes made in the organisations.
Thereby, it is necessary to make sensible leadership goals that may not
hamper the manner in which an organisation conducts its business. For example, a
comparison can be made with the manner in which Nokia and Microsoft merged to
cope up with the changes in the market and still fail. At the same time, Kotak needed
to close due to the unsuccessful implementation of change in the organisation.
Hence, it is necessary that the rights and interests of the stakeholders be taken into
consideration.
Ethical issues faced by leaders
As stated by Chatera and Loewenstein (2016) leaders are often faced with
ethical issues while contemplating changes in an organisation. One such issue is
convincing the employees about the changes that are taking place. It is often
grievance that the changes in an organisation are implied with the knowledge of the
employees and this may lead to positive as well negative outcomes in an
organisation. Considering the fact that changes are made for the betterment of the
organisation, managers may be affected positively as employees may embrace the
challenge.
However, Margolis and Stoltz (2010) are of the opinion that changes normally
bring about negative consequence in an organisation and thereby the violation of the
ethical issues may provide opportunities for employees to resign from the
organisation and seek employment in a different organisation. Hence, it can be said
that the positive as well as the negative consequence of ethical consideration can
have impact on the stakeholders of a company.
McNamara (2015) is of the opinion that the application of Lewin’s change
theory can help in analysing and understanding the problems related to changes.
The model provides analysis on three steps namely the unfreezing, change and
refreezing stage. This can help in understanding the level of leadership that the
organisation is currently placed. In this case, the third level of leadership is attained
by the organisation. Pye (2005) is of the opinion that smart leadership decision
needs to be made so that the changes can be effectively implied using the models.

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Reference
Applebaum, S.H., Habashy, S., Malo,J.-L., and Shafqiue, H., 2012. Back to the
future: Revisiting Kotter 1996 change model’, Journal of Management Development,
31(8), pp.764-782
Camillus, J.C., 2008. Strategy as a wicked problem, Harvard Business review, 86(5),
pp. 98-106
Chatera, N., and Loewenstein, G., 2016. The under-appreciated drive for sense-
making, Journal of Economic Behaviour and Organisation, 126(B), pp.137-154
Fairhurst, G.T., and Connaughton, S.L., 2014. Leadership: A communicative
perspective. Leadership, 10(1), pp.7-35.
Jaskson, B. and Parry, K. 2011 ‘Very Short, Fairly Interesting and Reasonably
Cheap Book’, volume 2 (page 95-96) London: Sage Publication
Margolis, J.D. and Stoltz, P.G., 2010. How to bounce back from adversity, Harvard
Business Review, 88(1/2), pp.86-92
McNamara, L.A., 2015. Sense making in organisations: Reflection on Karl Weick and
Socila Theory. Available at https://www.epicpeople.org/sensemaking-in-
organisations/ (accessed 15 July 2017)
Pye, A., 2005. Leadership and organising: sensemaking in action, Leadership, 1(1),
pp.31-49