Analyzing People Management and Change at SAR Health Services Report

This report analyzes a case study of SAR Health Services, a multinational enterprise undergoing organizational change. The company aims to unify production sites to reduce operational costs, facing resistance due to factors like relocation and layoffs. The report examines factors managem...Read More

Running head: PEOPLE MANAGEMENT AND CHANGE
PEOPLE MANAGEMENT AND CHANGE
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Introduction to the organizational case
SAR Health Services, is a multi-national enterprise which is based in Switzerland. The
organization has been taking the initiative of adhering to the environmental concerns through the
development of different staff training and induction sessions. The intensification of completion
in the markets and the increased pressure on the equipment budgets for healthcare organisations
mandated the need for the organization in developing ways of minimizing the operational
expenses. In this connection, the organization aimed at unifying the production site A with B
while closing the prior. However, there are significant resistance that was faced by the
organization while implementing the project. Therefore, the report would outline the different
factors that might be considered by the organization while implementing the project and the
manner in which the issues in HR management might be resolved by the business in due course
of time.
Factors that might be considered by the management before proceeding with the change
Change processes are specifically based on the critical understanding of the urgency that
is being faced by the organization and the immediate benefits that might be encountered by the
same through the change process. The major factor constituents that might be considered by an
organization while implementing a change are the need for change, resource and capabilities, the
organizational culture, the interests of the stakeholders and outcome from the change process. In
this connection, the case organization might take the initiative of evaluating the above mentioned
factors with the purpose of identifying the feasibility of the change in the organizational structure
and the manner in which the project plan might be approached.
Need for change:

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The organizations take the initiative of identifying the urgency that is being encountered
by the same while implementing any change in the operational processes. According to McCabe
(2020) change in the organizations are specifically designed with the purpose of contributing to
their competitive edge while operating in the different markets. Moreover, Ybema, Thomas and
Hardy (2016) added that an organization moves towards a change in the organizational processes
to cope with the uncertainties while improving their operational criteria and achieving the
common goals of the venture. In this connection, the concerned business have taken the initiative
of developing cognition on the change needs based on the current increase of their operational
costs through a reorganized business model. It has been observed through the case of the
organization that the business moved from a functional business structure to matrix structure
which increased their operational expenses.
The increased operational expenses affected their annual margins while competing in
intense competitive markets. Therefore, the organization is facing a crucial need of minimizing
the operational expenses through the unification of the production site A with site B and
introduction of open planning. The strategies would enable the organization is reducing the
energy and resource use of the organization. On the other hand, the organization is required to
lay off 5- 8% of the workforce from the office and production departments with the purpose of
minimizing the operational expenses. The reduction of the operational expenses would allow the
venture in improving the annual margins while minimizing the cost of the propositions so that
the offerings are afforded by the healthcare organisations.
Clarity of communication with the stakeholders:
Every organization prioritizes communication with the stakeholders with the purpose of
empowering the engagement of the same in the different change processes. Negotiation with the

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employees and making the same aware of the different business needs are important factors that
might be considered by an organization before implementing a change in the organizational
model. Mathews and Linski (2016) opined that empowering effective communication assist an
organizational management in making the key stakeholders aware of the different change
processes for empowering readiness among the same. The concerned organization might
consider communication of the organizational objectives and the overall change process with the
stakeholders, specifically the employees, with the purpose of encouraging their engagement in
the different business operations. Moreover, Akbar (2017) observed in a research that effective
communication empowers an inclusive approach while encouraging the involvement of the
stakeholders while influencing their trust and commitment towards the business. Therefore, the
concerned organization must consider communication for empowering trust and commitment of
the employees while making the same aware of the goals of the venture and the change process.
Resource and capabilities:
The evaluation of the resource and capabilities enable an organization in increasing the
effectiveness of the business operations while operating in an international market scenario. The
resources and capabilities of the organization encourage modifications. Resources like financial
capital, human workforce, processes and technologies govern the change initiatives in an
organization. Thakur and Srivastava (2018) stated that the different changes in the resource
structure and capabilities enable an organization in improving the competence of initiating a
change process. Moreover, Moutousi and May (2018) observed in a study that effective
functioning of an organization in terms of the change project is specifically empowered through
specific knowledge on the resources capabilities of the organization and the manner in which the
same might be invested. Therefore, the concerned organization might take the initiative of

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planning on the resource and capabilities of the same with the purpose of minimizing the
operational expenses while retaining a steady annual return.
Organizational culture:
The organizational culture specifically aims at justifying the nature of change that is
being planned by an organization. As per the case of the concerned organization, the business
aimed at reducing a significant amount of carbon footprint by the year 2022. Moreover, the green
strategies that are being planned by the organization not only aimed at reducing their
environmental impact but also the operational expenses. In this relation, the unification of the
production units intended to achieve the common goal of the venture in reducing the resource
use along with the operational expenses for realizing better margins. Therefore, the
organizational culture is one of the major factors that might be considered by the concerned
organization while implementing the project and prioritizing the different activities.
Interests of the stakeholders:
The cognition on the interests of the stakeholders is an important concern that might be
considered by an organization as the same supports a business in holding effective negotiations.
The different aspects of change in the organizational operations are based on the effective
functioning of the different system whole operating as per the common goals of the venture. In
this relation, the organizational case reflected on some of the issues that might be encountered by
the employees while traveling 100 miles away from Site A to Site B which might increase their
traveling expenses. Moreover, the organization aimed at laying off 5- 8% of the employees from
the production and other office positions which might again result to dissatisfaction among the
employees and cause resistances towards the change process. Therefore, the assessment of the

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increasing concerns that might be faced by the employees during the change process and
identifying the areas of their interests would enable the organization in improving the planning
and implementation process.
Outcome from the change process:
The judgement on the outcome of the change process is an important consideration that
might be made by the organization while proceeding with the project. According to Dwyer
(2019), most of the organizations undertake the initiative of facilitating changes on the basis of
result oriented approach. Aligning the expected outcome with the need for change enables an
organization in identifying the feasibility of the project in the organizational model and the
manner in which the same would deliver sustenance (Evans and Evans 2018). The major issues
that are being faced by the case organization are related to the increase in the operational
expenses which has exceeded the annual margins, threatening the sustenance goals of the
venture. Therefore, the concerned organization might take the initiative of assessing the different
strategies and the manner in which it supports the venture in minimizing the operational
expenses.
People management issues that might be faced by the management while implementing the
change
The people management issues specifically acts as restrictive forces to the change that is
being planned by a business entity. According to Fors (2017), organizations take the opportunity
of managing the human resources with the objective of encouraging their involvement in the
different change projects. The increased involvement of the employees and the other
stakeholders in the different organizational operations permits a venture in influencing the

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effectiveness of the business operations while addressing the common goals of a business. In
this connection, the case organization encountered several issues in managing the human
resource. The section will be analysing the issues that are being faced by the organization in
managing the human resource:
Conflicting interests:
The conflicting interest of the business management with the employees have been
noticed to be one of the major issues that are restricting the capability of the venture in managing
the human resource. The organization initiated the project on the basis of empowering their
profit oriented motifs while disregarding the concerns that might be faced by the employees
while adhering to the change in the business system (Ferreira, Cardoso and Braun 2018). It has
been observed through the case that the organization aimed to unify the production units at site A
and site B and start the new unit in site B. The production teams will be relocated to site B as the
organization has been encountering challenges in minimizing the operational expenses, resulting
to diminished profit margins annually. In this connection, most of the employees complained that
they would have to invest more for the travelling expenses as the site B was 100 miles away
from site A. The organization made no efforts to compensate the transportation expenses that
might be incurred by the employees while adhering to the new project requirements and change.
On the other hand, the organization aimed at laying of 5 -8 % of the employees from the
production units and the overall office staffs. It again created dissatisfaction among the
employees due to loss of employability of the same in the organization, affecting their lifestyle.
According to Pereira, Maximiano and de Souza Bido (2019), the different changes in the
organizational operations are reliant on inclusive attitude of the management towards
encouraging employees. Therefore, the case organization failed to identify the concerns that

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might be encountered by the employees while aiming towards ensuring their annual margins,
resulting to disagreements and conflict of interests.
Absence of transparency of communication:
The transparency of communication between the management and the employees play a
major role in increasing the commitment and trust of the workforce. According to Ileri and Arik
(2018), the transparency of communication permits an organization in empowering its
negotiation skills and encouraging maximum involvement of the employees in the different
business operations. In this connection, the case organization faced significant issues in
maintaining the commitment and trust of the employees due to absence of transparent
communication. It has been observed in the course of the case study that there were rumours of
the change process among the workforce even before the organization made an announcement of
the change project. The rumours created a negative impact and uncertainty among the employees
associated with a high level of job security related concern among the employees. Therefore, the
lack of transparency between the organizational management and the workforce have created a
gap between the same and acting on the change needs of the venture while encouraging
maximized participation.
Frequent changes in the organizational process:
The frequent modifications that were made by the organization in reduced span on time
greatly affected the adaptability of the workforce in the case organization. The different changes
in the organizational operations are specifically reliant on the effective functioning of the
different systems while adhering to the common goals of the venture. According to Grama and
Todericiu (2016), the decreased adaptability of the employees to the different change processes

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that are planned by the organization might challenge the organizational capability of empowering
the change projects. In the case of the concerned organization, it has been observed that the
organization has implemented two restructuring in the last three years which affected the
capability of the employees to adapt themselves to the common goals of the venture. Moreover,
it might be noted that the frequent restructuring activity might affect the trust of the employees
towards the competencies of the management. The workforce might perceive the management
of the concerned organization as a confused board which has limited knowledge on the course of
changes and its impact on the organizational operations. Therefore, the frequent modifications in
the organizational case affected the capability of the organization in influencing the behaviour of
the employees towards the change project.
Recommendations for proceeding with this project
The assessment of the different issues in the organizational setting supports in identifying
the recommended course of activities that might be considered by the concerned organization for
issues that are being encountered while managing the human resource. The section will
enumerate the different mitigation strategies for the case organization:
 Providing the employees with amenities and creating alternative job positions: The
organization has been primarily facing a major issue due to the dissatisfaction of the
employees to move a further 100 miles to site B. Most of the employees in the
organization complained of the increased cost of transportation that might be incurred by
the same while adhering to the organizational change process. In this connection, the
organization might take the initiative of providing the employees with a percentile of
compensation for the extra miles that they are required to cover for the new business
project. Compensating the employees on the increased transportation costs would allow

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the venture in encouraging the involvement of the workforce towards achieving the
common goals of the venture. On the contrary, the organizational employees are feeling
threatened of joblessness as the organization focused on laying off a certain percentage of
employees from the production departments. In this connection, instead of laying off the
employees the organization could take steps to train the employees and create alternative
job positions for the same in the sales team. The creation of alternative job positions for
the employees in the sales team would not only allow the organization in minimizing the
conflict of interests with the chief stakeholders but also strengthen the activities of the
sales team for better sales opportunities in the markets. The exposition of Maslow’s
Hierarchy of needs in this situation would enable the organization in identifying the
security and psychological needs of the employees (Serban and Iorga 2016). The
application of the theoretical context would allow the organization in assessing the
dissatisfaction among the employees relating to increased transportation costs. Moreover,
the theory would also allow in developing an idea on the psychological threat that is
being experienced by the employees due to layoffs.
 Improving links of communication: Improving communication between the management
and the employees allows an organization in improving the inclusiveness of the same in
the different business processes. In this connection, the concerned organization might
take the initiative of improving communication through meetings and sessions with the
employees while projecting different presentations aligned to the growth objectives. The
conduction of meeting session would allow the organization in making the employees
aware of the change and reduce risks of falsified rumours affecting the commitment and
trust of the employees. Moreover, the meetings and sessions would also provide the

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organizational management with applying the concept of authentic leadership and
gathering insights on the concerns that are being encountered by the stakeholders while
following the overall operations. Authentic leadership is a style of leadership that is
specifically focused on promoting ethical and honest behaviour of the leaders for gaining
support and commitment of the employees (Goksoy 2017). Therefore, meetings, open
discussions and briefing sessions would allow the organization in upholding the clarity
and transparency of the change objectives through application of authentic leadership
principles. Moreover, the open discussions would allow the organization in establishing
collaboration between the employees and the management while empowering the values
of LMX (Leader- Member Exchange) in the organization.
 Negotiating and making the employees aware of the positive side of change: The
negotiations with the employees would allow the organizational management in
portraying the positive side of the change and its need in the organizational process
design. Negotiations support an organization in overcoming the resistances that might be
encountered by the same otherwise while operating in a business environment. The case
organization aimed at minimizing the operational expenses and resource dependency. In
this connection, negotiation and sessions with the employees would allow the
organization in encouraging maximized involvement of the employees in the different
processes while achieving the common goals of sustenance.
Factors that might be considered by the organization for building on its change capability
The factor conditions that might be considered by the concerned organization for building
on its change capability are being discussed in this section of the report.

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 Human resource: The organization is planning to reduce the cost of operations with the
purpose of improving their profit margins annually. In this connection, the extensive
support and involvement of the workfare in the different business goals contributes to the
change capability. Managing the human resource and allocating the same as per the
organizational objectives would support the business in empowering the change
processes. Mismanagement of the human resource might lead to resistances which might
challenge the implementation of the change project in the case scenario.
 Financial resource: The financial resources play an important role in judging the change
capability of any organization. Financial planning identifies capability of the
organizations in making investments as per the change needs. In this connection, the case
organization is looking forward to merge the production units which requires renovation.
Moreover, the change from a functional structure to matrix business structure also
requires capital investments. Therefore, the assessment of the financial resource in the
case of the organization would help in judging the capability of the same in influencing
the change project.
 Training of the employees and awareness on resource use: The training of the
employees and creating awareness among the same are the most important factor
conditions that identifies the capability of the business in empowering change. Training
of the employees in undertaking the sustainable measures would allow the organization in
minimizing the resource use. On the other hand, the awareness among the employees
would enable the organization in building on the change capability of the same while
operating in accordance with the change plan.

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Conclusion
Therefore, from the above analysis it might be observed that SAR Health Services face
significant issues relating to mismanagement of the HR, which might act as a restrictive factor
for the change initiative that is being planned by the venture. The organization is planning to
minimize the operational expenses with the purpose of improving their profit margins. However,
absence of transparent communication and clashing interests between the employees and the
management acted as restrictive force. Therefore, the report enumerated the recommended
activities that might be considered by the business for mitigating the challenges and empowering
change. Moreover, the research also identified the factors that the organization might consider
for empowering the change capability.

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References
Akbar, S.I., 2017. Business Process Reengineering and Change Management Strategy to
Overcome the Resistance to Change. Available at SSRN 3502035.
Dwyer, K., 2019. Managing resistance to change: Engaging and shaping. IQ: The RIM
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Evans, G.E. and Evans, M.G., 2018. Understanding Resistance to Change as Loss Aversion and
Prospect Theory. Journal of Business and Economic Policy, 5(1), pp.1-7.
Ferreira, A.I., Cardoso, C. and Braun, T., 2018. The mediating effects of ego-resilience in the
relationship between organizational support and resistance to change. Baltic Journal of
Management.
Fors, S., 2017. Change's biggest obstacle:" fear of change": How employees cope with change
resistance in an organizational change.
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Grama, B. and Todericiu, R., 2016. Change, resistance to change and organizational
cynicism. Studies in Business and Economics, 11(3), pp.47-54.
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Mathews, B. and Linski, C.M., 2016. Shifting the paradigm: reevaluating resistance to
organizational change. Journal of Organizational Change Management.
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Appendix
Fig: Maslow’s hierarchy of needs
(Source: Nadim and Singh 2019)