Leadership and Change: Nestle's Perrier Union Resistance Report

This report analyzes the case of Nestle's acquisition of Perrier and the subsequent challenges it faced due to union resistance to change. The assignment identifies two primary reasons for the union's lack of motivation: misunderstandings between management and the union, stemming from inadequate information and differing perspectives, and parochial self-interest among some union members. The report then proposes two interventions Nestle should take to gain union support: participation and involvement of union members in the change process, using Kurt Lewin's Three Step Change Model; and implicit and explicit coercion, potentially including negotiated production targets and, if necessary, layoffs. Finally, the report suggests two methods for measuring the effectiveness of these interventions: openness and consultation, through consultative meetings with the CGT union members, and conducting proper sessions to communicate the need for restructuring and the potential benefits for the company and its employees.

Running head: ORGANIZATIONAL DEVELOPMENT
Organizational Development
Name of the Student
Name of the University
Author note

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Table of Contents
Answer to Question 1......................................................................................................................2
Identification of Two Strongest Reasons for Explaining Why Unions were not Motivated to
Work............................................................................................................................................2
Answer to Question 2......................................................................................................................3
Proposing of Justification of Two Suitable Interventions Nestle Should Take in Gaining
Support of Union Members.........................................................................................................3
Answer to Question 3......................................................................................................................5
Explain with Two Examples on how Nestle Should Conduct for Measuring Effectiveness of
the Stated Intervention.................................................................................................................5
References........................................................................................................................................7

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Answer to Question 1
Identification of Two Strongest Reasons for Explaining Why Unions were not Motivated to
Work
In the respective scenario, the two strongest reasons due to which Unions were not
feeling motivated to work includes the following:
Misunderstanding between the management and the union were the first and major
reason for them to not feel motivated. It mainly evolved due to the inadequate information
related problem wherein management of the company could not agree with the decisions or the
suggestions which were provided by the union members. The union suggested that Jean Paul
Franc, head of the CGT at Perrier tries to see the situation differently and due to the respective
aspect, it impacted the morale of the members of the union to a large extent due to which it led to
resistance to change among them. Due to the same, the relationship between management and
the union were estranged and due to the lack of proper understanding, the union of employees
disagrees with the efforts of Nestle in improving the financial performance of Perrier and they do
not see any change for the change to be commenced (Palmer, Dunford & Akin, 2006).
Parochial Self-Interest is the other major element due to which it affected the motivation
among the union members in performing the different tasks. There were few union members
who were only bothered regarding the implication of the change process for them and till what
extent, the changes which will be taking place will be affecting their own interests. The union did
not care much regarding the impact of the change for the success of the business, and due to such
aspects, it created lack of coordination among union members and the management of the

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company in implementing the change in the company that could have been for the betterment of
the company (Magrum & Weber, 2018).
From the analysis, it can be found that these are the two major reasons which led to the
ineffectiveness in the process of working by the unions at Perrier and it created negative impact
on the performance of the company as a whole in the entire business environment.
Answer to Question 2
Proposing of Justification of Two Suitable Interventions Nestle Should Take in Gaining
Support of Union Members
From the analysis of the above, it can be seen that there was misunderstanding along with
the parochial self-interest that impacted the performance of the company negatively. In such
scenario, the two suitable interventions which should be taken by Nestle in gaining support of the
different union workers include the following aspects:
Interventions Necessity and Usefulness
Participation along with Involvement of Union
Members
The respective approach is useful wherein in case
of Perrier, for analyzing and diagnosing the
problem, the involvement of union members is
highly necessary and important wherein both union
and Nestle need to set up the same goals for the
problems which are impacting the performance of
the company negatively.
The Nestle officials, while implementing the
change process in the Perrier Company, could have

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included the different kinds of employees in the
process which will be beneficial in making the
process highly efficient and it could be suitable for
making the union members understand that they are
being involved in the process of decision-making
as well.
The respective approach will be helpful for
lowering the resistance and merely acquiesce to
change in a suitable manner and gain competitive
advantage in the market. With the help of the Kurt
Lewin’s Three Step Change Model, the union
workers could have informed regarding the process
of change in managing the resistance and
motivation (Subaciute & Rao, 2019)
Implicit and Explicit Coercion It is the suitable approach wherein the speed in the
process of change is highly essential which will be
effective in understanding the requirements of the
change in a successful manner (Jing, 2017).
The managers and the other officials of Nestle
needs to work together with the CGT wherein
Nestle can be capable of negotiating the projected
kind of percentage of the increased level of
production which will be suitable for the union
workers to feel that they are being valued and it
will be enhancing their performance to a large

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extent within a short span of time. With the help of
the same, it will be capable of reducing the
misunderstanding among union workers and gain
competitiveness in the market in a suitable manner
(Raeder, 2019).
Nestle officials could have included the other
aspect wherein there can be layoffs which will be
15% as it will be required when the union workers
are not ready to support the change process which
is being taken by Nestle for reducing the problems
faced by Perrier (Al-Mulla et al., 2019).
Answer to Question 3
Explain with Two Examples on how Nestle Should Conduct for Measuring Effectiveness of
the Stated Intervention
From the overall analysis of the situation and the suitable interventions which should be
implemented by Nestle for gaining the confidence and support of the union workers of Perrier,
the two examples which will be capable of understanding and measuring effectiveness of the
stated interventions are described as follows:
Openness and Consultation- It is the first and foremost aspect and example wherein
while implementing the change at Perrier. The union workers who were dissatisfied wherein they
dumped the bottles in front of the factory director’s door, so that he could not get in the office
can be improved to a certain extent. The consultative meetings with the CGT members would be

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helpful in reducing the conflict as their support is highly necessary in managing the change
process successfully and make the company highly productive in nature in comparison to the
other competitors (Hussain et al., 2018). The openness is highly essential in the respective time
as it will be making the union members feel that Nestle officials are trying to involve them in
improving the position of Perrier in a proper manner and there is no hide and seek involved in
the process as well. Additionally, the openness with the union workers CGT for making them
realize that they are needed to work hard through showing them the financial and other sensitive
information regarding the company and it will be for the benefit of the company as well
(Arazmjoo & Rahmanseresht, 2019).
Proper Sessions are Needed to be Conducted- It is the second example wherein the
management of Nestle is required to make the CGT union members understand that in order to
move forward with the plan in a successful manner, the main aspect which is needed is the
support from CGT to make them realize that Nestle intends to cut more than 15% of workers for
turning Perrier around. In such scenario, the similar information is needed to be communicated
with the employees by assuring them with the fact that they will be employed later on in
different other departments of the company after the entire restructuring is being done (Cameron
& Green, 2019). The proper sessions wherein all the members of the CGT will be included for
assuring them that the 15% layoff is needed as per the current scenario and in the future, the
same will be improved that will be creating benefits for the Perrier Company and the company
will be able to come out of the danger from which they are going through in the respective
scenario (Bakaria, Hunjrab & Masood, 2017).
Therefore, from the analysis of the examples, it can be inferred that resistance to change
or lack of motivation to work among the union members were the key issues faced by Nestle

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officials regarding the Perrier employees. In such scenario, the interventions play a crucial role in
improving the effectiveness of the scenario and gain competitiveness in the market.

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References
Al-Mulla, A., Ameen, A., Issac, O., Nusari, M., & Al-Shibami, A. H. (2019). The Effect of
Organizational Tensions, Merge Policy and Knowledge Sharing on Managing
Organizational Change: The Context of Abu Dhabi National Oil Organizations. Journal
of Engineering and Applied Sciences, 14(8), 2517-2531.
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managing organizational change. Management Decision.
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Pakistan: Insights from the work of Kurt Lewin. UW Journal of Management Sciences.
Cameron, E., & Green, M. (2019). Making sense of change management: A complete guide to
the models, tools and techniques of organizational change. Kogan Page Publishers.
Hussain, S. T., Lei, S., Akram, T., Haider, M. J., Hussain, S. H., & Ali, M. (2018). Kurt Lewin's
change model: A critical review of the role of leadership and employee involvement in
organizational change. Journal of Innovation & Knowledge, 3(3), 123-127.
Jing, R. (2017). Managing Organizational Momentum for Change: Connecting Chinese and
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Palmer, I., Dunford, R., & Akin, G. (2006). Managing organizational change. New York:
McGraw-Hill.
Raeder, S. (2019). The role of human resource management practices in managing organizational
change. Gruppe. Interaktion. Organisation. Zeitschrift für Angewandte
Organisationspsychologie (GIO), 50(2), 169-191.
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change.