Organizational Change Management Report

This report examines organizational change management at Thomas Grocer, a small grocery store in Sydney, Australia. The report begins by evaluating the Australian grocery industry, noting the dominance of Woolworths and Coles and the challenges faced by smaller retailers. A SWOT analysis of Thomas Grocer highlights its strengths (strong employee knowledge, good customer relationships, favorable store locations) and weaknesses (insufficient workforce, high rental costs, lack of online presence, and absence of a loyalty program). The report then applies Kotter's 8-step change management model and the McKinsey 7S model to analyze the organization's current situation and propose change initiatives. The key recommendation is to implement an e-commerce platform and a customer loyalty program to enhance competitiveness and attract more customers. The report concludes by emphasizing the importance of employee training and development in successfully managing the change process and achieving the desired outcomes. The report uses various academic sources to support its analysis and recommendations.

Running head: ORGANIZATIONAL CHANGE MANAGEMENT
Organizational Change Management
Name of the Student
Name of the University
Author note

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Executive Summary
Within the business sector, change is an inevitable being which lead the organizations to deal
with the challenges, grab more opportunities and meet the demands of the consumers. The
retail sector of Australia has faced a slow but stable growth in the past few years. This report
has taken a small grocery store, Thomas Grocer for documenting this study. The organization
has been planning to incorporate more e-commerce approaches within their business;
therefore this report evaluates their change management procedure. The recommendations are
made accordingly.

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Table of Contents
Introduction................................................................................................................................3
Evaluation of the industry..........................................................................................................4
Organizational culture and structure..........................................................................................5
SWOT analysis...........................................................................................................................6
Strength..................................................................................................................................6
Weakness................................................................................................................................6
Opportunity............................................................................................................................7
Threats....................................................................................................................................7
Kotter’s Change Management Theory.......................................................................................7
McKinsey 7S Model..................................................................................................................8
Change initiatives.......................................................................................................................9
Recommendation......................................................................................................................10
Conclusion................................................................................................................................11
Reference List..........................................................................................................................12

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Introduction
Change has been a significant part of any organization, especially within the changing
political, economic, social and technological climate. In return, the changes lead the
organizations to meet greater demands, opportunities and challenges in terms of developing
the retail sector. The fundamental dynamics of changes in the retail sector of Australia has
already generated more interest for the researchers, as the big Australian retailers have
already implemented several changes and the small ones are now taking innovative and bold
steps against the global competitors (Hayes 2014). This also requires reshaping their existing
strategies to gain the competitive advantage in the market place and attract more customers.
Retailing in Australia has been successful for the small businesses so far. In the last financial
year, the retail market of Australia has shown to have increased by around 3%, however in
terms of the previous year’s growth rate; it has shown a slower rate (Cameron and Gree
2015). However, the change management is very much required, especially for the grocery
retailers, as this sector of retailing has seen the highest growth in the last few years. This
report will study the retailing market of Australia in terms of a small grocery retailer, Thomas
Grocer in Sydney. The organization is a comparatively small grocery store which has started
planning for a change in order to attract more customers on the domestic level. However, due
to this change the employees of the organization were not being able to cope up with the
situation. I have been working with this organization for last two months as a part-time sales
person, therefore in this report I will evaluate the industry and the internal and external
contexts for prescribing the change initiatives. The models and theories will be discussed to
support the proposed change initiative. Recommendations will be made for the possible
issues due to the change within the organization.

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Evaluation of the industry
According to Varley (2014) the grocery industry of Australia is mostly dominated by
two big players, Woolworths and Coles. Both these organizations hold around eighty per cent
of the entire market share. However, there are several independent retailers and wholesalers
in the market along with different specialty retailers. Other than the two big players in the
market, there are few international grocery organizations such as Aldi. Moreover, both the
Woolworths and Coles have a significant impact on the price control of the Australian
grocery market. However the Australian market is an established competitive market which
has set the prices in a relative way according to the buying behavior of the customers within
the market. In the recent times, the most dominating characteristics of the retail market is that
the organization are utilizing the advancements of technology as an effective method for
luring the potential customers. This has effectually increased the amount of buying materials
within the industry. The organizations have also implemented the loyal program cards which
have been very much effective in retaining the customers. However, Fernie and Sparks
(2014) has indicated that there are few barriers within the industry which may hinder the
growth of the industry to a great extent. Several organizations are not being able to entry in
the market or to expand due to the lack of sites as the desired ones are already taken by the
big players of the industry. Moreover, the entire industry had become monopoly due to the
bigger players in the industry. Roth (2016) also reveal that the there has been a hike in the
market prices even though there has not been any changes in the quality of the product.
However, all the findings regarding the industry indicate that there is a workable competition
in the market along with the existence of the monopolistic power. Moreover, the small
organizations in the market need to deal with this competition strategically as the competition
is quite tough here.

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Organizational culture and structure
Thomas Grocer is a small grocery retail shop in Sydney with two outlets in the city.
The organizational structure of the organization mostly determines the business activities of
the company. The structure of Thomas Grocer also enforces few limitations on the way of
addressing problems Thomas Grocer has a functional hierarchical organizational structure.
There dominant features of the structures are definitions on the basis of functions and
hierarchy. The hierarchy relates to the vertical command lines and authoritative throughout
the structure. For instance, other than the Managing director of the company, all the
employees have a superior employee. The directions mostly come from the higher levels of
the management and implemented by the middle management. The job definitions on the
basis of functions involves different group of employees for different job definitions. Fior
instance, there are different departments in the organization such as, marketing and sales
department, human resources department, finance department, customer service department
etc. The people who are capable of working in such department are only put in such teams.
The organizational culture of Thomas Grocer has few primary components. These
components are utilized in guiding the organizational behavior of the employees. The
components are:
 Providing best service to the customers
 Respecting every individual
 Doing the actions with adequate integrity
In case of providing service to the customers, Thomas Grocer prioritizes the clients
most in the operation chain. However, the organization also identifies the contributions and
efforts of the employees for making the business successful. Along with that, the organization
also strives for excellence within the individual performances, respective teams, and the

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organization. In addition to that, the organization promotes the values of fairness, honesty and
impartiality within the decision making procedure. However, the organization requires
applying its beliefs and core values in the operational chain.
SWOT analysis
Strength
The primary strength of Thomas Grocer is that the organization has excellent
employee who have strong knowledge regarding the existing products. The organization also
has good relationship with its customers in the neighborhood. In addition to that, the
employees also have a good internal connection with the management and they have always
maintained the hierarchy (Cullen et al. 2013). Two of the stores of Thomas Grocer are
located in a good position in Sydney; therefore even if there is higher competition in the
market along with monopoly, the organization manages to pull the crowd. This is also
because the successful marketing strategies that the organization has applied. The
organization has constant presence in social media, magazines and news paper. The
organization is also reputed for innovation in the market.
Weakness
Recently the organization has faced struggles with meeting the deadlines as the work
force is not sufficient for managing the entire increased work load. As the locations of both
the store outlets are in a good position, the organization has to bear the higher rental costs.
There are also cash flow issues. The organization does not keep its records in a proper way.
Therefore it does not even have any loyalty program which can be helpful in retaining the
customers (Gallino. and Moreno 2014). The organization also does not provide the
opportunity of online shopping to the customers. Sometimes, they have to hold larger stock as
well.

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Opportunity
The organization has a good reputation in the market; therefore the organization is
reliable for the customers. There is also a strong customer base in the market; however, the
organization needs to expand it. The demand in the neighborhood has also increased in past
financial years.
Threats
The strong competitors and the major key players in the retail sector are the main
threats for the business. Most of the customers are now interested in doing online shopping;
however, the organization still does not provide this opportunity for the customers. Also the
depression in the economical situation has also affected the business in the last few years.
Kotter’s Change Management Theory
Kotter’s Change Management Theory is one of the most popular theories around the
world. A professor at Harvard Business School, John P. Kotter has derived this theory where
he has divided the change management process in eight stages, such as,
 Increase urgency – This stage includes the creation of a urgency sense among people
for motivating them towards the desired objectives (Neumeier 2013).
 Build the team – This stage indicates to get suitable people in the team mixing their
knowledge, skills and management.
 Get the correct vision – This step is related to the creation of the right vision with the
strategy along with objectives, emotional contacts and creativity (Burke 2017).
 Communicate- This is a major stage where the communication with people takes
place about the change and the need for it.
 Get things done- For empowering the things or the required actions, it is necessary to
get adequate support, remove the obstacles and implement necessary feedbacks.

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 Focusing on the short-term goals- Focusing on the short term goals will enhance the
way of achieving the success.
 Not giving up- Being persistent is the ultimate key for success; therefore one should
not give up at any stage (Hayes 2014).
 Incorporate the change- Other than managing the change in an effective way, it is
significant to incorporate it and make it a major part of everyday work culture.
This theory has described the entire change management process in a step by step way,
therefore it is easier for the organization for following and incorporating it in the system.
However, this model is quite time-consuming as all the steps have to be followed.
McKinsey 7S Model
This model had been developed by the consultants of McKinsey & Company. There
are seven stages in this model, such as:
 Strategy: The strategy indicates to the plan which has been created for reaching the
goals. This stage also involves a step wise future plan (Mitchell, Fredendall and
Cantrell 2015).
 Structure: This is the stage of this model which can be related to the method to follow
to reach the goal.
 Systems: For getting a job done, the system is the way which elaborates the regular
day activities.
 Shared values: This refer to the primary or the core values of the respective
organization.
 Style: This is way which the change is implemented and the leaders of the
organization adopted (Alshaher 2013).
 Staff: This refers to the employees and their capabilities of working the change out.

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 Skills: This refers to the competencies and the knowledge of the employees who are
the existing workforce of the organization.
This model refers to the methods in a transparent way with a profound insight in the way of
reinforcing it. This also considers all the necessary components for implementing the change
and offers a directional factor for the organizational change (Alshaher 2013). However, all
the sections in the model are co-related, therefore if one stage fails, it is highly possible that
the other ones starts failing too.
Change initiatives
In this internet era, it is necessary to have a successful online presence for any
organization, especially in the fast growing countries like Australia. The penetration of
internet shows that there are several identifiable changes in the buying behavior of the
Australian grocery and retail customers. Alshaher (2013) indicates that most of the customers
are now more comfortable in shopping their groceries online as it saves time. There are
several stores which also offer convenient deals for using the banking transactions while
shopping. Therefore, Thomas Grocer will offer its customers the opportunity of shopping
online along with the customer loyalty cards. These cards will offer the customers an added
benefit such as flyer points while using. This will increase the numbers of purchase as the
customers will want to gain more flyer points. The store can also start a rewards program
which will let the customers have more benefits such as more discounts on the next shopping
or on the shopping of any related store. Therefore the organization will be able to increase the
demand of the customers to a great extent by offering them the online shopping and loyalty
programs. This will also help Thomas grocer to gain a competitive edge amongst the small
retailers in the Australian grocery market. The organization should also adhere to its strategy
as mentioned in the previous models and ensure that they have a actual plan for materializing.

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Recommendation
Recent researches on the implementation of the online shopping system indicates that
the customers are mostly impatient, therefore they get easily dissatisfied if there is any issue
with the website or the application and move to another retailer. Therefore, while
implementing the changes in the online shopping and loyalty program in Thomas grocer, the
management has to ensure they provide unique experience to each of the customers. This will
help them not only in retaining the old customers, but also attracting the new ones. The
following recommendations are made for the organization which may help them to enhance
their chain management procedure.
Firstly, the organization needs to chalk out the plan for the required change. This will
eventually let the company find out the gap in their system thoroughly. The management
should analyze their entire business process and understand why they require implementing
the change. After the analysis, they need to validate the improvements which can be
reinforced in the system through the change initiatives. At this stage, the organization needs
to have a profound understanding that what is happening within the market place. This will
help them in planning a strategy which can include the significant changes.
Secondly, the organization will also require identifying the key Performance
Indicators for tracking the outcomes of the change initiative. This will ensure that the
organization can easily measure the success of the proposed change initiatives.
Thirdly, Thomas Grocer will also require structuring the entire plan of changing the
shopping platform for the customers. The plan can only be structured when the organization
has fixed goals. The change management procedure will only be successful when the entire
process contains the naturally occurred disruption and resistance. Therefore the more the
organization focuses on its goals, the more they can accomplish the desired goal. According

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to McKinsey 7S Model, this stage is very important as it defines the ways of accomplishing
the goal.
Fourthly, the organization needs to take of the technological issues strategically.
While opening an online shopping website and application, it is very important to choose a
right domain which is catchy and easy to remember for the customers. They should also
avoid any kind of similarities with any other existing names of the domain. It is better to
choose the same name as the store.
Fifthly, the online store should be set up following a right catalog. The online stores
do not really have sales persons, therefore thee visuals and product descriptions should be
effective enough to make sure the online visitor ends up being a customer.
Sixthly, the organization should also train and develop their employees so that they do
not face any kind of trouble with the change management.
Conclusion
In conclusion, it can be said that, in the retail industry it is very important to bring
more innovative procedures and changes in their regular processes. The effective changes in
structuring, technology, policies and strategies can help the organizations to sustain in this
global market environment. In this essay, the change management process in a small grocery
retail business has been suggested. However, the organization also needs to remember that
they can have several change initiatives, but it is the employees who can make the entire
change management procedure possible. The possible recommendations for managing the
change have been suggested in this essay as well.

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Reference List
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older and younger adults. Decision Support Systems, 83, pp.47-56.

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Mitchell, B.C., Fredendall, L.D. and Cantrell, R.S., 2015. Using McKinsey’s 7 S Model to
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Neumeier, M., 2013. Using Kotter's Change Management Theory and Innovation Diffusion
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Roth, L.J., 2016. Successful Business Process Management in Retail.
Varley, R., 2014. Retail product management: buying and merchandising. Routledge.