Report on Understanding and Leading Change in Retail Sector

This report analyzes change management within the context of Sainsbury's and ASDA, focusing on the impact of change on organizational operations and strategy. It examines internal and external drivers of change, including technology, economic factors, and political influences, and their effects on leadership, individual, and team behavior. The report also explores measures to mitigate the negative impacts of change on organizational behavior, such as the application of system theory and the PDCA cycle. It further investigates barriers to change and their influence on leadership decision-making, as well as the application of different leadership approaches to effectively manage change initiatives. The report highlights the importance of adapting to market trends, technological advancements, and economic fluctuations to maintain a competitive edge. This document, contributed by a student to Desklib, offers valuable insights into leading change in the retail sector and provides practical applications of change management theories and leadership strategies.

Understanding and
Leading Change

Table of Contents
INTRODUCTION...........................................................................................................................1
TASK 1............................................................................................................................................1
a) Impact of change on organisation's operations and strategy..............................................1
b) Ways in which internal and external change drivers leadership, individual and team
behaviour................................................................................................................................3
c) Measures to minimize negative influence of change on organisational behaviour............5
TASK 2............................................................................................................................................7
a) Barriers to change and their impact on leadership decision making..................................7
TASK 3............................................................................................................................................8
a) Application of different leadership approaches to deal with change.................................8
CONCLUSION................................................................................................................................9
REFERENCES..............................................................................................................................10

INTRODUCTION
Change is a continual process that require to be done by all organisation in order to
sustain and grow in marketplace for long term. Different number of chances takes place in
environment where business perform its all operations and activities systematically. In the
present report, chosen organisation is Sainsbury's and ASDA, both are deals in retail sector.
Sainsbury's decide to integrate with ASDA, hence new organisation launched with name
“Sainsbury ASDA”. It belongs to retail industry of United Kingdom. This assignment includes
effect of change on strategy and operations of companies as well as impact of change drivers on
its behaviour. Different models and theories are determined on overcoming the negative
influence of alteration. Apart from this, barriers to change are also determined that highly effects
on leadership decision-making. At last, different range of leadership theories to a change
imitative is also include in this project.
TASK 1
a) Impact of change on organisation's operations and strategy
Change is a continuous process for each and every company in order to sustain in
competitive marketplace. In an organisation, presence of all change will highly impacts ins
operations and strategies in direct or indirect manner. It may take place in different ways like
technology, market trends, organisational culture, preference and taste of customers. There are
mainly two factor of change such as external and internal drivers. Under internal factor, changes
consists of technological factor, organisational culture and financial management.
In case of external changes, it consist economical, social, environmental and political
factor. In an organisation, changes are play vital role in the success and development at
competitive market. In recent days, digitalisation is identified as main variation that has more
impact on business operations (Díaz, 2013). It is benefit the company to enlarge their business
functions as well as help in attraction of different client to purchase their goods and services.
Another change is flexibility which is adopted by firm that assist in becoming more successful.
Sainsbury's: It is the supermarket chain in the UK. It was founded by John James
Sainsbury in 1869. It is specialises in the marketing of Fruit & vegetables, Meat & fish home etc.
ASDA: It is a British supermarket retailer, located in Leeds, West Yorkshire, England. It
was founded by Roger Burnley in 1965. It specialises in the selling of Grocery, financial services
and general merchandise.
1

Sainsbury's is a retail company located in the United Kingdom. It has decide to merge
their business operations and activities with similar size of company which is ASDA. Main
purpose behind merging their business to increase market share and strong position at global
level. If both organisation get integrated then they have a better possibility of accomplishing
competitive edge (Dori, Mevarech and Baker, 2018). It support them in making a strong position
over their competitors like LIDL, TESCO etc.
Organizational change can take different forms such as company’s strategy, policies,
structure, technology, procedures, or culture. The modification may be formed years in
beforehand or may be required on an enterprise because of a change in the environment. There
are some changes in the firm and its impact on its strategy and operations are explained as under:
Technology: Sometimes alteration is encouraged by speedy development and
improvement in technology. As per the point of view of Gordon Moore, change dictates that the
whole complexity of computers will multiple approx 18 months with no maximise in cost
(Organizational Change, 2018). Such change is promoting firm to modify their technology
factly. The technological challenges concerned in business include the designing of strategies to
make efficiency, advantage, profitability and effectiveness.
For example: In operations have been changed by innovative developments like
interactive kiosks, mobile payments, RFID tagged products, smart shopping carts and BLE
technology. Beside this, The technology that leads the change effects numerous stages of firm,
such as enterprise system and back office and, to a lot of consumers-facing functionalities like
payments, loyalty programs and customer services. Thus, it prove changes in technology has
more effect on business operations and strategies. Set a right price for a product is very essential
for an organisation generate revenue and to sustain in market. Technology plays an essential role
in everything from production to sale of the final items. Business can use new technologies like
computerized pricing models to assist company gauge the product demand and set optimum sale
price.
Change in the supply or demand: It is a main change which highly effects on the
business operations and strategy in direct manner. In case of alteration in demand and supply
there is direct influence on production. Due to reduction in demand of product manager has to
modify production schedule. Hence, there is impact on operation of organisation either in
positive or negative manner because of fluctuation in demand. There is direct relationship
2

between price of the product and its supply. This implies with an increase in price of a particular
product will lead to an enhancement in its supply as well and vice versa.
b) Ways in which internal and external change drivers leadership, individual and team behaviour
Business environment forms an amalgamation of various external and internal factors
that have major impact on the working style and decision making process of an enterprise. Thus
in order to be competitive in dynamic business environment it is of critical importance for firm to
introduce necessary modification in its present policies, strategies and procedures that can be
supportive for it to attain sustainability and higher growth (Jayson-Quashigah, Addo and Kodzo,
2013.). As every change or alteration implemented in a company significantly impacts a firm's
leadership style, behaviour of teams and individual thus, it becomes responsibility of a manager
to efficiently coordinate and implement changes them to be successfully. Mentioned below are
certain internal and external drives in context to firm :
Internal Drives of change Organisation culture: In involves beliefs, values, vision, habits and assumption that
influence behaviour of employees in a firm. These factors plays critical role in building
overall performance and managerial behaviour of a company. Thus, it becomes critically
important for merger organisation to evaluate these aspects such as difference in working
culture between these two organisations and to develop appropriate strategies for
overcoming these gaps that could further lead to emergence of conflicts and arguments
between its workforce (Kutter and Westby, 2014). Thus it requires initiative to be taken
by leaders to enhance communication among employees by organizing various team
building activities that will help in developing their mutual understanding and trust and
therefore reduce down chances of conflicts. Financial management: Funds are the basic and most significant internal factor that
greatly impacts working of a firm. “Sainsbury ASDA” requires sufficient amount of
financial resources for smoothly conducting their business activities. Therefore any
inefficiency while estimating funds requirements and sources to obtain them might
critically hamper functionality of business operations further resulting in decreasing in
operational capacity that exerts negative affect on firm's outcome and profits (Bayramov,
2013).
External Factors driving to change
3

Economy: Economy is one of the most critical factor that comprises interest rate,
inflation, unemployment etc. that affects demand for products and services offered by a firm. In
context to firm operates globally and thus are likely to get impacted by prevailing economic
condition of nation (Li and et. al., 2018). For instance due to inflation profits of business
declines by 19% to £21.6bn from £22.3bn in 2016 (Asda returns to sales growth thanks to price
cuts and inflation, 2018). Whereas for Sainsbury, they decrease in profit which was of 0.1% in
march 2017. Thus, there was substantial decrease in the demand that significantly impacted the
profits margins of both these companies. Therefore, both companies to overcome with this
situation are required to encourage its employees for enhancing their productivity that will assist
firm in reducing down cost of its products.
Political Influence: Political factors involves government-business relationship, political
stability, norms and regulation enforced by government, tax policies etc. that are likely to impact
on the business operations of “Sainsbury ASDA”. For instance merged organisation collectively
owns 15% of total grocery market of UK. With the Brexit both these companies are to slash
down £150m of costs in March 2017 this year and £500m in upcoming three years (Sainsbury’s
CEO warns post-Brexit rules could leave food rotting at UK border, 2017).
Impact of change drivers Leadership: It forms one of the major factor that is critically impacted by any change in
internal or external drives (Mattjus, 2018). For example when a contingency situation
rise than leaders of the company have to adopt variation in their management styles with
purpose to encourage workforce and give accurate guidelines to their group members for
accomplishing set objectives. Behaviour of individual and team: Any alteration within organization in context to
process, policies or strategies significantly impacts behaviour and actions of team and its
members. For instance in adoption of latest technology by “Sainsbury ASDA” in its
business operations are likely to influence the working style of employees. It is because
introduction of this change will modify their normal course of actions and will require
them learn something new. Therefore to reduce the chances of encountering any
resistance from workforce it is requisite for companies to communicate them about
necessities and benefits associated with new technology and to provide them proper
training so that they can handle new technology.
4

 Impact of change on team dynamics: Team dynamics introduce to the psychological
unconscious factor that effect the way of behaviour and performance of team. It is
formulated by nature of team's . If any variation takes place in group then it powerfully
influence on its team members either in favourable or unfavourable way. Present working
can have more impact on entire group team of company. Whereas, when any
modification is enforced, other person may perceive eliminate from working or
operations, thus outputs in classifying the team into two.
c) Measures to minimize negative influence of change on organisational behaviour
Every organisation wants to sustain in competitive market for longer period of time
which can be possible through identifying the market opportunities that will help them in
competing with rivals effectively. (Murthy and Paul, 2017). There are various changes in policies
through which an organisations are able to deal with risk and challenges that comes due to
uncertainties and contingencies. To overcome such risks, there are various theories connected
with change management such as system theory, PDCA cycle and Bohner and Arnold change
impact analysis theory. Application of such theories facilitate management to bring some
changes in their management in order to operate business functions more effectively. These
theories assist management in identifying the suitable changes that can be implemented and
accordingly make modification that lead the workers to perform their roles and responsibilities in
more profitable way. Therefore, firm are required to focus on adoption of such theories within an
organisation so as to maintain healthy relation with their employees so that quality products are
produces with minimum cost. It indirectly help company in achieving loyalty of customers which
makes positive impact on profitability and sustainability. Such theories are briefly described
under the following:
System theory:
This theory is an effective and useful one to be apply by administrator of company as it
assist them in maximising motivation of work force and inspiriting them in order to execute their
responsibility more effective and efficient manner. Application of this theory demonstrate to be
beneficial and important in terms of maximising organisational as well as workers performance.
It helps business in creating groups, promoting team working and maximising productivity.
Thus, Implementation of this framework can support manager in rising profits and sales of
company. Therefore, it is essential in reducing negative effect in the organisation. (Nath and
5

Behera, 2011). Such theory is very much depend on the environment for various important
resources such as customers, shareholders investment, government regulations, employees and
suppliers. It mainly focuses on performing business activities according to the guidelines and
regulations implemented by the Board of Directors so as to achieve desired goals and objectives
within pre-determined time period.
PDCA cycle:
Firm apply this cycle for enhancing their performance and productivity and in decreasing
negative effect of change on organisational behaviour. This is the model which help in assisting
management to enhance the internal as well as external operations which decide the growth and
success of an organisation. It is more useful to adopt by “Sainsbury ASDA” so as to make an
effective decisions and suitable plans for their betterment in competitive market. PDCA cycle
has comprising four parts which includes:
PLAN: It is the step in which suitable plans has been made with the help of having
information about the problem faced by an organisation.
DO: In this step, the management focuses on bringing out optimum solution through
conducting research and implement them accordingly so as to achieve desired outcome. Initially,
modification are eliminated in policies and practices of firm.
CHECK: Under this step, the management make comparison between the outcomes
achieved before and after (Osentoski, 2016).
ACTION: Under this step, documents are maintained so as to aware the employees about
the adoption of changes and allow them to provide their suggestions for issues that may come
during next PDCA cycle. Impact of modification is analyse by firm manager. If effect of
alteration is favourable, it will be applied at large scale. But, if it let down to reduce negative
effect of variation then various method will be follow by administrator to cut down its effect on
organisational behaviour. Such theory is more useful for “Sainsbury ASDA”to minimise the
negative impact of change.
Continuous improvement model:
It is another useful theory which facilitate “Sainsbury ASDA” to survive in competitive
market for longer period of time. To develop improvement in business processes and operations,
such model plays an essential role. Approaching of this framework ensures accomplishment of
6

set goals and target effectively (Pollitt, 2015). To ascertain successful execution of continuous
improvement model, business Manager require to apply a cycle which is determined below:
These all above mentioned theories brings profitable outcomes to organisation in near
future thus must required to apply by merged organisation in their business operations.
TASK 2
a) Barriers to change and their impact on leadership decision making
While changes are necessary they are usually resisted by staff as it is traumatic,
completely unknown and is feared to apply coming out of comfort zone and taking up new
challenges. Thus even when change are well planned by top management it always become
difficult for company to apply the planned strategic change systematically and successfully
without encountering any obstacle. “Sainsbury ASDA” being global multinational brand are
subject to many external and internal factors that time to time makes it necessary for these firms
to introduce certain modification in their business activities to remain competitive. Mentioned
below are some prominent barriers to change and their impact on leadership decision-making :
Ineffective communication: It is refers as one of the big barrier that business faces at the
period of implementing change. Ineffective channels of communication restricts administrator to
communicate main information and messages about modification which effects their decision
making power in unfavourable way. Lack of communication effects on employees performance
as they remain unaware about changes taking place in organisation which impact on overall
productivity. Administrator need to apply appropriate channel of communication in order to
transfer data effectively to workforce.
Lack of employee involvement: employees involvement in decision making increase the
chance of accurate decisions because employees have personal experience of direct interaction
with the customers. But if there is lack of employees involvement in decision making then it will
affect the policies which have been formed by the company as well as decrease their morale and
it will also affect the work quality of the employees. If the company wont involve employees in
decision making then there is no guarantee of that the employees are working with their full
capacity.
7

TASK 3
a) Application of different leadership approaches to deal with change
Democratic Leadership: It is a type of leadership in which employees take part in the
decision making process of the company. The employees are free to provide their thought to
strengthen the market position of the company. In such type of leadership each member of the
team is given the chance to participate, opportunity to exchange their ideas and right to discuss
any doubt. It gives the chance to the leaders to redistributes the cognition and control among
employees to enhance their involvement in decision making process (Reddy, 2015). It shows
cooperation and free flow of the ideas of employees related to the company.
(Source: Different type of leadership styles, 2017)
Transformational Leadership: In such this type of leadership the leader works with the
team to find out the areas of improvements, create the long term vision for the company and
fulfil the commitment that has been made to the subordinates. This theory serves to improve the
motivation, morale and job performance of subordinates (Different type of leadership styles,
2017). In this type of leadership the leader try to identify strengths and weaknesses of the
employees to improve their work quality and productivity of the company. It inspires the
employees to attain unexpected and outstanding results of their work. It provides the opportunity
to the employees to make decisions once they have completed their training.
8
Illustration 1: Different types of leadership
styles

Situational Leadership: In this model, more importance is provided on the specific
situations which may develop when transaction are executed. Situational leadership Practices are
much easy and flexible to become adapted in present surroundings of company. It is an
accommodative leadership style. It is used by various organisations to develop people and work
groups, to establish a good image in the market, to bring out the best qualities of the employees
by providing them opportunities to perform tasks according to their capacity (Roux and et. al.,
2016). The followers are not bound to adopt the style of the leader but the leader have to change
his style according to the employees.
“Sainsbury ASDA” use transformational and situational leadership theories to improve its
quality and market image. As leaders communicate the business information, delegate work
allotment and motivate employees. These help the company to develop strong position and
maximise business turnover. The employees in “Sainsbury ASDA” are free to discuss any kind
of issue to the leader which leads to creation of a better environment resulting in higher
productivity. The leader work in a team and try to bring out the best from the employees by
analysing them. The leader identifies the capability of the employees of merged organisation
and then distribute the work accordingly. .
CONCLUSION
From the above mentioned report it can be concluded that changes plays vital role that
give a better chance to acquire success and growth in market. It is the role of leader to give more
attention of modifying environment and develop policies consequently for remaining adaptive in
the marketplace. There are mainly two factors such as external and internal that state variation
within business functions and an environment. Company follow different leadership methods to
deal with this modification and to decrease barriers for reducing negative effect over the
profitability and growth of an enterprise.
9

REFERENCES
Books and Journals
Bayramov, A. I., 2013. ECONOMIC TIME FROM METHODOLOGICAL POINT OF VIEW:
ANATOMY OF CONCEPTUAL VISION. Journal of Economic Sciences: Theory &
Practice. 70(2).
Díaz, A., 2013. Intercultural understanding and professional learning through critical
engagement. Babel. 48(1). p.12.
Dori, Y. J., Mevarech, Z. R. and Baker, D. R., 2018 Cognition, Metacognition, and Culture in
STEM Education.
İnandıklıoğlu, N. and et. al., 2012. Chromosome imbalances and alterations of AURKA and
MYCN genes in children with neuroblastoma. Asian Pacific Journal of Cancer
Prevention. 13(11). pp.5391-5397.
Isenhour, C., O’Reilly, J. and Yocum, H., 2016. Introduction to Special Theme Section
“Accounting for Climate Change: Measurement, Management, Morality, and Myth”.
Human ecology. 44(6). pp.647-654.
Jayson-Quashigah, P. N., Addo, K. A. and Kodzo, K. S., 2013. Medium resolution satellite
imagery as a tool for monitoring shoreline change. Case study of the Eastern coast of
Ghana. Journal of coastal Research. 65(sp1). pp.511-516.
Kutter, A. and Westby, L. D., 2014. Managing rural landscapes in the context of a changing
climate. Development in Practice. 24(4). pp.544-558.
Li, X. and et. al., 2018. Studying compaction-decompaction of DNA molecules induced by
surfactants. Biochemical and biophysical research communications. 495(4). pp.2559-
2565.
Mattjus, C., 2018. Global warming and its impact on water-associated infectious diseases in
Eastern Africa.
Murthy, V. and Paul, B., 2017. Nature of buyer–supplier relationship: small businesses in a
Small City. Journal of Small Business Management. 55(3). pp.365-387.
Nath, P. K. and Behera, B., 2011. A critical review of impact of and adaptation to climate change
in developed and developing economies. Environment, development and sustainability.
13(1). pp.141-162.
Osentoski, N. J., 2016. Changing From the Inside Out: Leading Organizational Change as An
Insider. Journal of Positive Management. 6(3). pp.41-66.
Pollitt, C., 2015. Towards a new world: Some inconvenient truths for Anglosphere public
administration: The IIAS Braibant Lecture 2014. International Review of Administrative
Sciences. 81(1). pp.3-17.
Rahman, M.S., 2012. Applications of macro–micro region concept in the state diagram and
critical temperature concepts in determining the food stability. Food Chemistry. 132(4).
pp.1679-1685.
Reddy, S., 2015. Effects of different types of soccer balls on player performance in an indoor
futsal environment.
Roux, A. V. D. and et. al., 2016. The impact of neighborhoods on CV risk. Global heart. 11(3).
pp.353-363.
Xue, M., Hitt, L. M. and Chen, P. Y., 2011. Determinants and outcomes of internet banking
adoption. Management science. 57(2). pp.291-307.
10

Online
Different type of leadership styles, 2017. [Online]. Availavle through:
<https://www.pinterest.com/pin/486670303463675723/>
Asda returns to sales growth thanks to price cuts and inflation, 2018. [Online]. Availavle
through: <https://www.theguardian.com/business/2017/aug/17/asda-sales-growth-price-
cuts-inflation-aldi-lidl>
Sainsbury’s CEO warns post-Brexit rules could leave food rotting at UK border. 2017. [Online].
Availavle through: <https://www.independent.co.uk/news/uk/home-news/sainsburys-
ceo-mike-coupe-brexit-food-eu-goods-uk-border-a7927606.html>
Organizational Change. 2018. [Online]. Availavle through:
<http://open.lib.umn.edu/principlesmanagement/chapter/7-5-organizational-change/>
11