Analysis of Change Management: GE and Lenovo Case Study Report

This report provides a comprehensive analysis of change management and leadership strategies employed by General Electric (GE) and Lenovo. It begins by outlining the major changes each company underwent, including GE's transformation under CEO Jeffrey Immelt and Lenovo's acquisition of IBM's PC unit. The report uses SWOT analysis to identify drivers for change and compares the impact of these changes on the strategy and operations of both firms. It further evaluates the impact of internal and external drivers on leadership, individual, and team behavior, applying change management theories to minimize negative impacts. The report explores barriers to change, using Kurt Lewin's force field analysis to determine support and opposition within GE, and assesses how leadership approaches supported the change. The report concludes with recommendations and a critical evaluation of the responses to the changes. The report highlights the importance of leadership, strategic decision-making, and the ability to adapt to changing market conditions for organizational success, providing a detailed examination of the challenges and triumphs of change management in these two global companies.

Running head: UNDERSTANDING AND LEADING CHANGE
Understanding and Leading Change
[Lenovo and a Case Study Company ‘GE’]
Name of the student:
Name of the university:
Author note:

1UNDERSTANDING AND LEADING CHANGE
Table of Contents
Part 1................................................................................................................................................2
1.1 Major changes........................................................................................................................2
1.2 SWOT of each organization to identify the drivers for change.............................................3
1.3 Comparing and analyzing the impact of changes on strategy and operations of each firm. .5
2.1 Evaluating the impact of internal & external drivers of change in leadership, individuals
and team behavior........................................................................................................................8
2.2 Using the change management theories & models to identify how negative impacts of
change on the businesses were minimized................................................................................10
2.3 A critical evaluation of responses thereafter.......................................................................12
3. Recommendation and conclusion..........................................................................................12
Part 2..............................................................................................................................................13
4.1 Different barriers to change and how these impact the leadership's decision making........13
4.2 Applying Kurt Lewin’s force field analysis change model to determine opposition and
support for changes in GE.........................................................................................................14
4.3 A critical evaluation of how all these helped GE to fulfill its organizational objectives....14
5.1 Using change management and leadership theories and models to identify the advantages
and disadvantages of different leadership approaches dealing with change.............................15
5.2 Applying different leadership approaches to deal with the change in GE..........................16
5.3 Evaluating how leadership approaches did support the change and how successful was it16
References......................................................................................................................................17

2UNDERSTANDING AND LEADING CHANGE
Part 1
1.1 Major changes
General Electric (GE)
The major change that took place in ‘GE’ was the transformation or remaking of GE to
an iconic and historic company. The change was made by the CEO of the company, Jeffrey R.
Immelt, during extremely challenging and volatile times. The change had faced all sorts of
circumstances such as recessions, geopolitical risk and bubbles. During the entire period of
change, new competitors kept on emerging and the fact had required considering a makeover of
business model every single time. CEO of modern ages is explored to a variety of challenges
where they are tested for their leadership skills in relation to decision making and the operation
management. The best part of the transformation in GE was its CEO’s decision to identify the
sectors to put into the change. The CEO did not include the entire portfolio in the transformation
process. The CEO rather separated out the low-tech and slower-growing sectors (Hbr.org 2018).
Additionally, the CEO had the clear vision to reinvent GE as the leading name in technological
solution. The technological advancement was tried for with the transformation process.
Lenovo
The biggest transformation in Lenovo has been its transition into a technological solution
which stepped into the place of IBM and successfully led the new responsibilities. The
transformation is one of the biggest in the last 10 years. IBM due to the average performance of
its PC unit had sold this to Lenovo in 2005 (Forbes.com 2018). The move was full of challenge
for Lenovo due to many things such as the cultural differences between Lenovo and IBM. There
are indeed huge cultural differences between a Chinese and an American company. The

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transformation had required employees in the PC unit of IBM to move to the Chinese company
Lenovo. This was not an easy task especially due to the cultural differences. Top officials in
particular could have resisted form leaving their existing company and moving to a culturally
different company. However, the leadership in Lenovo had worked at this point in time. They
were able to convince employees that everything will remain the same. The feat had worked and
employees were convinced to move. There were few initial hiccups also like the one when the
US government had denied access to government contracts or data to a Chinese company.
Lenovo success can be credited to the leadership formed in the company due to the merging of
IBM and Lenovo. The success of the venture needs to be credited to the hard works of the
American and Chinese leaders. The two cultures have surprisingly worked together. The trust of
Chinese leaders in the American leadership is a point to wonder. The leaders at Lenovo did not
hesitate in working together with Steve Ward who worked as the architect of the deal from IBM
(Fortune 2018).
1.2 SWOT of each organization to identify the drivers for change
GE
Strengths: General Electric has a highly diversified portfolio ranging from energy
infrastructure, NBCU, consumer & industrial to technology infrastructure. It has a long history of
acquisition which helped it to attain a global presence. They have been able to perform even
during the recessions and economic downturns. Strong and inspiring leadership is one of the key
assets of GE. The culture in the company is fuelled with desires and skills to support the
innovation and technology (Hbr.org 2018).

4UNDERSTANDING AND LEADING CHANGE
Weaknesses: The industrial division of the company has not worked. It has struggled to
perform well in developing and Asian markets. Inability to control the market shares have
become evident on quite a few occasions in past. One of the biggest mistakes was to step into the
financial business at the time when the industry had struggled due to the housing and banking
crash in between 2007 and 2009 (Hbr.org 2018).
Opportunities: The new CEO Mr. Immelt in 2001 had sensed that the company can reach
a dominating position and also become the leading technological solution. The opportunity was
grabbed by effective leadership and strategic plans of the CEO of GE. The CEO was able to
identify that digital technology was the vision for the company (Hbr.org 2018).
Threats: The execution of the change management was one of the biggest threats to the
CEO of GE. Additionally, they had the challenge to face the current competition while also
heading towards the set vision. The threats were for successfully passing through during the
recession & the economic challenges and becoming a gainer all the time (Hbr.org 2018).
Internal and external drivers for change
 Ability to perform during recessions and economic downturn
 Organisational leadership in the form of CEO Mr. Immelt
 Organisational culture
 Opportunities for digital technology
Lenovo
Strengths: Lenovo is very good at delivering and identifying the leadership acts. A
profound existence in the Chinese market is another worthy point for Lenovo. Lenovo has a

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strong patents portfolio. They are competent with regards to mergers & acquisitions. Knowledge
management and diverse workforce is another good thing to note down (Forbes.com 2018).
Weaknesses: They have a very poor perception of brands in developed economies. They
had no significant existence in the computer hardware sector until the deal between Lenovo and
IBM was finalized (Forbes.com 2018).
Opportunities: Portfolio enhancement is one of the opportunities for Lenovo. The
growing Smartphone market in the Asian countries especially in India was an opportunity which
Lenovo had grabbed by successfully merging with Motorola (Fortune, 2018). The collaboration
with IBM to enhance its product portfolio was a potential opportunity (Forbes.com 2018).
Threats: Saturated smartphone market in developed countries is a threat to Lenovo. Rapid
technological advancement is also a threat as this would require a more execution of
transformation into the digital technology. Intense competition both in the PC and smartphone
units is a potential threat for a continued growth in market shares (Forbes.com 2018).
Drivers for change
 Identifying the leadership acts
 Expertise in mergers & acquisitions
 Profound knowledge base and diverse workforce
 Portfolio enhancement
1.3 Comparing and analyzing the impact of changes in strategy and operations of each
firm

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The changes highlighted in relation to GE and Lenovo were the potential challenges for
both of the companies. This section of the study will show how the changes or the transformation
process had impacted the operation strategy & the decision making in both GE and Lenovo.
GE
The newly appointed CEO in 2001, Mr. Immelt, had identified the needs to undergo the
transformation process. The transformation process is always a challenge to execute as because
more than 60% of the transformations have failed so far. Additionally, transformation requires
the fulfillment of two most important things such as leadership and the culture of change
(Cummings, Bridgman and Brown 2016). This can be said that GE was able to attain and
maintain both the identified variables. It had the leadership management in the form of the CEO.
It also had the contribution from other members as well. These were the reasons that had
supported and flourished the transformation even during the challenging times. The leadership
was evident when the CEO had identified the product line to put into the transformation process.
The leadership at GE and employees had helped the company to sustain the transformation even
during recessions. The CEO had continuously allowed thoughts to frequently come in.
Recruitments were done to make an impact on each of the departments (Van der Voet 2014).
Decision making and strategic management of operation had both helped the
transformation in GE. There had been the few bold decisions which require a leadership
personality to lead. It was a bold decision to discontinue the entire portfolio that GE had. This
was also a good decision when the CEO had decided to focus on incepting a culture for change
in the workforce. Focussing a lot on becoming the world’s leading name in technology is itself a
very bold decision. Such decisions require the utmost commitments from leaders, employees and

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the other members in organizations (Lines et al. 2015). GE had delivered on this account which
is mainly due to the leadership in the CEO Mr. Immelt.
Operations were also conducted differently than it used to be before the new CEO had
stepped in 2001. The transformation was supported with disciplined leaders and employees. The
CEO was never a quick absorber of new trends. The leader rather waited and made extensive
observations before adopting the trend. It is indeed advisable to identify the organization's needs
and accordingly select the best feasible technologies & trends for the company. The changed
leadership had also affected the cultural values of GE. The entire team had actually worked as a
unit and had delivered the results (Matos Marques Simoes and Esposito 2014).
Lenovo
At the time when Lenovo had sent a panel of executives to the US to discuss the deal
with the IBM’s executives, there were only one out of the panel of five as well versed with
English proficiency. That one person was the chief financial officer of Lenovo. There had existed
huge cultural differences between the two companies; however, Lenovo was able to convince the
executives of IBM. Lenovo assured that there will be the similar working experience for IBM's
professionals joining the Lenovo in China.
The deal or the transformation into the world’s leading name in the PCs unit has
impacted the decision making and the operational strategies at Lenovo. The current decision
making at Lenovo which demands fealty based on seniority had changed into a combination of
China’s long-term strategy and West’s sheer focus on meeting the quarterly targets. China is
worldwide famous for autocratic leadership style. However, the CEO at Lenovo who is just 49
has been found as different from the traditional Chinese managers. The CEO has fresh thinking

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and likes to work as a team which is like rolling on the Western tracks. Decision making for
branding has also changed. Lenovo is different to other Chinese companies such as Haier in
appliances, Geely & BYD in autos and Huawei & ZTE in telecommunications (Forbes.com
2018).
The transformation process has improved the supply chain operation of Lenovo. The
strategies were being changed. Initially, the supply chain operation had a lot of key performance
indicators to meet. It was not flexible also. The current CEO had reduced the key performance
indicators to just five. Top 50 managers were being assigned with responsibilities to train
employees on how to effectively handle the supply chain operation. The CEO, Smith, had also
adopted Workout to implement the group-based improvement techniques. It was originally being
developed by General Electric (GE). The move had allowed the inclusion of all decision-makers
in one room. The change in strategy making has also impacted the innovation in Lenovo. Today,
Lenovo holds a huge 40% of the US market with respect to laptops being sold over $900 or more
(Forbes.com 2018). One of the biggest changes was towards the different direction than other
Chinese firms do. The brand image had rarely been a key factor for Chinese firms; however, to
Lenovo, it matters the most. The transformation at Lenovo had infused a new blood into the
operation and consequently, the company started focussing on its brand image. Lenovo now
believes that premium products should also be produced. The brand image will help the premium
products to get sold.
2.1 Evaluating the impact of internal & external drivers of change in leadership,
individuals and team behavior

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There were few internal and external drivers which have influenced the change into GE.
General Electric has had this reputation to perform with the utmost challenge. GE is known for
performing even during recessions and economic downturn. The superiority had reached another
level with the inception of new CEO Mr. Immelt. The CEO had identified the potential in GE
and the possibility to exploit the opportunities. Consequently, the remarkable journey of change
had then taken off. The leadership of GE was more dynamic with Mr. Immelt. The changed
leadership at GE had changed everything from operational strategies to decision making. The
new CEO was able to identify the future and prospects for the digital technology. Consequently,
the big transformation that nearly took 16 long years to accomplish was introduced. The
transformation process was tested on most occasions; however, the changed leadership and the
workforce were able to see through it (Smollan 2015). The CEO had helped to redefine the team
behavior at GE. The company had faced attrition also during such a long period of
transformation. However, it managed it effectively with superior leadership in the form of Mr.
Immelt and the talented & integrated workforce.
Lenovo had this reputation to identify the leadership required to lead a team to a never-
attained feat. Such feat was responsible for the earlier success that Lenovo had from other sectors
such as the smartphone industry. Lenovo does identify the potential deals well and collaborate
accordingly to leverage the benefits. This is also why there have been quite a few mergers &
acquisitions in the Lenovo’s history. They are good at managing the knowledge base which
always gives a feeling that the diverse workforce which Lenovo has can help to attain the
difficult feats as well. The desire to enhance the portfolio has always motivated Lenovo to act
differently than other Chinese firms. Consequently, Lenovo had entered the Smartphone industry
and performed exceptionally well. Portfolio enhancement had also resulted in collaborating with

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IBM for its PCs unit. The team formed after due to collaborating with IBM was indeed very
unique for a Chinese company. Consequently, the workforce was a mixture of both Chinese and
American professionals. Top professionals from IBM had comfortably worked with Chinese
professionals in China. It really affected the strategy making which was initially centered just to
the long-term strategy had afterward collaborated with quarterly based target meeting (Kreimeier
et al. 2014).
2.2 Using the change management theories & models to identify how negative impacts of
change on the businesses were minimized
There are ample numbers of change management theories and models which can be used
to identify how negative impacts during the change processes were minimized. Lewin’s change
management model is one of those. Lewin says that to transform into a set vision it is important
to follow three steps as mentioned below:
 Unfreeze
 Make changes
 Refreeze
It specifies that it is important to identify the areas of changes and then preparing those for it. It
is followed by implementing the changes. Once the feat is attained, Lewin says to refreeze back
into the attained state to leverage the benefits of change. One of the setbacks during the change
process in GE was investing in the financial services. It was done at the time when the industry
met with banking and housing crash. The company according to Lewin failed to unfreeze
properly as it could not identify the potential industry to step into (Grant 2014).

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The McKinsey 7-S model is another very important model to identify whether the
change is coherent. It says that if seven parameters of the model are fulfilled then the change
would be held a rational move. According to McKinsey, GE during its journey to become a
digital company failed on quite a few occasions. Few of such instances are GE’s inability to
understand the threats of investing in the financial services and also in oil & gas equipment.
Financial investments have been made when the industry had suffered from housing and banking
crash. Investments were made for oil related equipment when the prices of oil had reduced
drastically. These circumstances as according to McKinsey just denote a failure to understand the
appropriate strategy. Hence, these were the few of negative aspects of the transformation process
in GE (Delmatoff and Lazarus 2014).
The change process in Lenovo is full of challenges or the negative aspects that really
tested the progress. Lenovo had initially faced challenges from the US government as the
company was denied from accessing the government data. There were huge cultural issues once
the union with IBM was officially announced. Employees especially the top professionals had
wanted to be with IBM only. According to Lewin, the change process had failed to identify the
requirements to unfreeze. It is important to identify the areas of improvement and the resources
required for it. Lenovo failed to identify that there will be difficulties due to the cultural
differences (Fuchs and Prouska 2014). According to McKinsey, Lenovo had no strategies to
counter the cultural differences. The first meeting of a panel of the executive from Lenovo with
executives of IBM in the United States had only one the CFO as an English speaking person. The
meeting was full of doubts. It shows a gap in strategy to approach a culturally different country.
Moreover, if a firm fails to deliver on any of the 7 strategies listed in the model the change would
not be held in a coherent move (Petrou, Demerouti and Schaufeli 2018).

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2.3 A critical evaluation of responses thereafter
An irrelevant strategy making by GE when it invested in financial services had crashed
with struggling business of the industry. GE had to quit its financial services. The decision would
be held rational as it was creating worries for the company and was also resisting the
transformation into a digital technology. However, the company also had no other ways to head
for. GE had also sold its troubled industrial solutions which is rational also. The company had no
other ways to head for. Interestingly, the portfolio of GE includes everything from jet engines, to
locomotives and medical equipment. These are just a few products line. However, the long
history of the transformation process is also associated with setbacks (Klonek, Lehmann-
Willenbrock and Kauffeld 2014).
Lenovo was able to convince the top professionals of PCs unit in IBM. The CEO did
ensure the top professionals and also the employees for the working conditions by assuring a
similarity with what they have at IBM. The cultural differences were then sorted-out with a
mixed workforce comprising of both Chinese and the American professionals. Not only this,
strategies were also combined. The long-term focus of Chinese was combined with short-term
targets of Americans. The combination shows a very rare example of a Chinese company
(Hesselbarth and Schaltegger 2014).
3. Recommendation and conclusion
Implementation along with misdiagnosis of the problem is the factor that causes the
change process to fail. This would be recommended that once the need for change is being
identified, the next step would be to identify the possible and the feasible areas for change. A

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wrong selection may also abandon the entire change process. This is important also because
leaders nowadays focus a lot on a stepwise execution of the change process.
In this section, the change process in GE and Lenovo has been discussed. GE had
undergone a transformation under the leadership of the CEO Mr. Immelt. The transformation had
lasted 16 long years and during the period the company had faced a lot of issues like a
withdrawal from the financial and the industrial sectors. The change was though planned to
become the global leader in technological solutions. Lenovo in collaboration with IBM stepped
into the PCs industry. The plan was to lead the industry with unrivaled challenges. During the
early days of the change process, Lenovo had faced a few challenges especially due to the
cultural differences between Lenovo and IBM. However, the problem was sorted out and the
CEO of the company was responsible for it. The CEO did not just convince the top professionals
from IBM but had also combined the two companies in the context of strategy making.
Part 2
4.1 Different barriers to change and how these impact the leadership's decision making
Change processes are full of challenges which are why most companies fail to deliver it
successfully. Based on the GE case study there are different barriers to change which are as
listed below (Hesselbarth and Schaltegger 2014):
 Inability to identify the areas of change as this would just abandon the entire process
 Ineffective leadership as they play a major role during the entire process of change
 Debating on priorities such as which is to give the priority of the different circumstances
during the change process
 Unshared goals as all need to contribute to the process

14UNDERSTANDING AND LEADING CHANGE
 Organisational culture is unfavorable to change
 Had it been in Lenovo, the company could not have been successful with IBM’s PCs unit
4.2 Applying Kurt Lewin’s force field analysis change model to determine opposition and
support for changes in GE
Kurt Lewin says that a company is in a state of equilibrium when driving forces for the
change and the restraining forces is both equal. The change will happen when driving forces for
the change are more powerful than the resisting forces. The equilibrium state according to Kurt
Lewin will then get disturbed (Stephan et al. 2016). In the light of the facts governed by Kurt
Lewin, there were following driving and resisting forces of change (Stephan et al. 2016):
Driving forces
 Leadership
 Organisational culture
 Talent management
 Experienced top professionals
 Sustenance
Resisting forces
 Decision making in few areas such as financial services and oil & gas equipment
 Unnecessary investments during wrong times
 Strategy making was also challenged
4.3 A critical evaluation of how all these helped GE to fulfill its organizational objectives

15UNDERSTANDING AND LEADING CHANGE
The supporting and resisting forces have both helped GE through its transformation
process. Leadership in the form of Mr. Immelt was the main point of attraction. The CEO had
carried the change process effectively even during the recessions. Organisational culture was
another positive aspect that helped GE to see through both positive and negative aspects of the
business. Talent management was also a key factor that produced a supportive culture to move
with. Managers were experienced and skilled as well. They had helped the company through
tough times by taking the most feasible decisions. Sustenance of the strategy execution was a key
character from the CEO and the workforce. Decisions making were tested for financial services
and the industrial solutions. However, sustenance was the key factor to get rid of the issue.
Unnecessary investments had also caused to suffer for financial and industrial businesses;
however, effective leadership and the ability to sustain with the decision have both helped
through the tough faces (Georgalis et al. 2015). This is also justified as according to Kurt Lewin,
change will be successfully achieved either by powering the driving forces of change or by
weakening the resisting forces of change.
5.1 Using change management and leadership theories and models to identify the
advantages and disadvantages of different leadership approaches dealing with change
Advantages and disadvantages of change
Lewin’s Change Management Model: Lewin’s model is specifically useful for a big
change. It is advantageous for firms which intend to undergo major changes such as the case of
GE. However, the absence of an in-depth analysis of the areas of change, this may certainly
abandon the transformation. If analysis and execution are appropriately balanced, positive
outcomes will appear (Grant 2014).

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The McKinsey 7-S Model: It is effective in cases where organizations need a better
strategy to change. Change attained with this model will have fewer chances of getting
abandoned. Chances for positive outcomes will be higher. If any of its variables are missed, this
would not allow the accomplishment of change and will simply abandon the change (Smollan
2015).
5.2 Applying different leadership approaches to deal with the change in GE
Required leadership steps will be as followed (Delmatoff and Lazarus 2014):
 Identify the areas of change
 Design a strategy to foster the change process
 Identify whether there are enough resources to support the change
 Powering the driving forces of change
 Sustaining the execution process
 Ability to pass through barriers
5.3 Evaluating how leadership approaches did support the change and how successful was
it
Leadership at GE had been phenomenal as it was able to sustain the progress even during
the challenging times. The leader was able to identify the areas of change; however, failed to
deliver a timely execution in the financial and the industrial sections. The change was introduced
to help GE become the leading name in the digital technology. The transformation process had
lasted for 16 long years which is quite a feat. By the time the CEO Immelt had resigned from the
position, GE was already making a triple earning.

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