Icon College: Understanding and Leading Change, Unit 17 Report

This report delves into the intricacies of organizational change, using ZARA and PRIMARK as case studies to illustrate key concepts. It begins by comparing the companies' strategies and operations, highlighting the impact of technological and structural changes. The report then evaluates internal and external drivers of change, assessing their effects on leadership, team, and individual behaviors, and proposes remedies to mitigate negative impacts. Furthermore, it examines different barriers to change and their influence on leadership decision-making, and concludes by exploring various leadership approaches to effectively deal with organizational change. The report also includes an analysis of the Burke-Litwin model and its application in managing change, offering a comprehensive overview of change management principles.

Understanding
and
Leading Change

Table of Contents
INTRODUCTION...........................................................................................................................3
LO1..................................................................................................................................................3
Comparison of various changes on an organization's strategy and operations .....................3
LO2..................................................................................................................................................6
Evaluation of internal and external drivers of change affecting leadership, team and individual
behaviours...............................................................................................................................6
Remedies to minimise negative impact of change on organizational behaviour...................8
LO3................................................................................................................................................10
Different barriers for change and their impact on leadership decision-making...................10
LO4................................................................................................................................................12
Leadership approaches to deal with organizational change.................................................12
Conclusion:....................................................................................................................................13
References:.....................................................................................................................................15

INTRODUCTION
Organizational change means any modification or alteration in overall working
environment
(Yılmaz and Kılıçoğlu, 2013). In other words, it can be said that if an organisation is affected by
any internal or external force, is known as organisational change. It is one of the necessary
process in this competitive working culture. Organisational change affect the working of an
organisation. An organisation must create ability to modify by changing its strategies, policies,
structural relationship and working climate. Furthermore, modern corporates are versatile,
dynamic and easily adapt changes. In the present report, ZARA and PRIMARK is chosen as a
base company. In addition to this, a detail discussion is mentioned regarding comparison of
various drivers for change. Along with this, impact of change in the behaviour of leadership and
individuals behaviour, different change barriers and its influence on leadership decision- making
has been discussed in this report. At last, application of leadership approaches in order to deal
with change has been mentioned in this report (Palmer and et. al., 2016).
LO1
Comparison of various changes on an organization's strategy and operations
Organizational structure is the framework which defines various ways in which
organisational activities are to be carried in order to achieve organizational goals. These
activities includes responsibilities, duties, roles and supervision. In addition to this, flow of
information within an organisation is also included in this.
ZARA and PRIMARK is the chosen company for this case. ZARA is a Spanish fashion
retailer company based in Arterio in Galicia. In the year 1975 it was founded by Rosalia Mera
and Amancio Ortega. Lean organizational structure is used by the managers of ZARA, as it
mainly focuses on high performance of organisation. Along with this, PRIMARK is an Irish
fashion retail company. Its headquarter is located in Dublin and a subsidiary of ABF. In June
19669, its first store was founded by Arthur Ryan. Because of its different level of hierarchy,
company adopt tall structure. Along with this, company follows decentralized system for
performing its operating activities.
Comparison between ZARA and PRIMARK on the basis of various drivers of change are
as follows:

Basis ZARA PRIMARK
Technological Change In order to modify ordering
process company uses point-
of-sale (POS) system. Further,
to check the availability of
latest designs of products on
regular basis, company
implement personal digital
assistant. Also online market is
launched by company in order
to make shopping easy for
their customers.
In order to make designer
dresses in less time with high
quality products, company start
using latest technology. As a
result company reduces their
defects and increase their
profitability. For maintaining
sustainability at the
competitive marketplace
company needs to upgrade its
technology according to the
changing environment.
Without launching an online
sites, company can reduce its
profitability as well as market
share as compared to their
competitors.
Technology Adopted Company adopted mobile
augmented reality app as a
promotional tool in 120 stores.
Along with this, company use
a technology which is
“location intelligence”. With
the help of this technology
company can easily track
footfall in stores.
Company have implemented
various software's in order to
maintain the performance of
the company. According to the
technological change,
company adopt different
software's, these are
performance management
software and many more.
Structural Change It has gone for vertical
integration with manufacturers
In order to increase its overall
sales revenue company expand

to introduce new products in
no time. The online website
has boosted the sales
especially in Europe. Control
policy has been implemented
for to make product with
higher quality and easy to
manipulate. Also, it has
collaborate with a California-
based Fetch Robotics to use
artificial intelligence for
managing the stock inventory.
its business in US and
Bangladesh. As a result
companies annual sales has
been increased by 17%. Main
motive behind this expansion
is to keep the prices low of its
products. At present company
has around 350 stores and
plans to open more in the near
future.
Differences in Organizational Approaches to Change
In this report, the above mentioned companies operates within the same industry but
company faces various differences in organizational structure. ZARA maintain flexibility in its
design and have strategical agreements with domestic manufacturers for timely delivery of
products and services. For this company need to analyse the market trends. On the hand hand,
PRIMARK mainly target consumers between the age group of 20 to 35 years and for providing
products in lower prices as compare to their competitors company adopt “cost leadership”. Along
with this, company have a separate team in order to analyse the current fashion trends across the
world ( Mowday and et. al., 2013)
Similarities in Organizational Approaches to Change
Both the countries operate within same industry so it is very obvious to have similarities
between them. ZARA and PRIMARK both operates its activities in retail sector. As a result,
trends and approaches followed by both the companies are similar most of the time. Also, both
the company shares same aim, which is maintaining long-term survival at the competitive
marketplace also by providing high quality products in order to fulfil customer's requirements
(McShane and Von Glinow, 2013).

LO2
Evaluation of internal and external drivers of change affecting leadership, team and individual
behaviours
Organisation change is very essential part for every organisation as it is inevitable. The
managers of the company can anticipate the changes according to the environment and formulate
plans accordingly (MacKian and Simons, 2013). Change is the essential factor for success of
company at the competitive marketplace. When the change is adapted by the members of the
organisation than it can grab opportunities from the market. Further the changes can put negative
impact on the working of the company. According to the level of pressure from the various
factors of change than modifications are required to be made in policies, processes and strategies.
Drivers of change- This refers to inclusion of factors which lay down the overall impact
on the industry or organisation. Industry participants are pressurised to modify their actions
which further leads to change in industries and organisations. Drivers of change occur in both
external and internal environment. These factors affect the behaviours of individuals, leaders and
teams working in the organisation. The decision-making of leaders is in favour of the company.
For effective decision-making they make appropriate procedures and policies to help human
resources accomplish their goals. Their are various external and internal drivers of change
affecting the individuals, team and leadership behaviours. Some of them are defined below:-
Internal factors and their impact:
These factors are those situations occurred within the business organisation and are
under the control by the managers of the company. Some of primary internal forces are discussed
below:-
Organizational culture- This refers to the values, beliefs, traditions and perception of
the personnel working in the organisation. Their is impact upon the behaviour of the employees
because of internal policies and strategies (Latham, 2013). It lays down negative effect on the
productivity, employee turnover, profitability etc. with reference of ZARA in the year 2015,it
has been alleged of Corporate Culture Favouritism which was based on skin colour that shows
employees have been discriminated. Whereas, PRIMARK has good employee retention ratio as
employees are highly satisfied working with the company.

Poor Delivery- Organisations face problems related to service quality and delivery
services which impact the profitability ratio across all the outlets worldwide. Furthermore,
entities should focus on managing time for effective delivery of the products on time which are
demanded by customers. In context of ZARA, the customers are not getting delivery on time
for the products being purchased from online site because of improper supply chain
management. On the other hand, PRIMARK sell good quality products by better services and
also emphasis on maximising customer satisfaction (Kaufman, 2017)..
Financial Management- Management of the capital in effective and efficient manner is
very essential for the success and growth of the company. The decisions are based on proper
allocation of funds for purchasing new assets and raw materials etc. In the context of ZARA the
managers should focus on maintaining the quality of products at low rates than their will be low
investment required. Whereas, PRIMARK makes huge investments which will provide with long
term returns by increasing sales for the company.
External forces and their impact
These forces arises by the external parties of the company which are beyond the control
of the mangers and leaders of the company. So, changes in the organisation must be made
according to the external pressure.
Technological Change- Their are frequent and rapid changes in the organisation because
of technological advancements and innovations in the environment. Every organisation should
remain updated and upgraded to gain competitive advantage in the market. Both ZARA and
PRIMARK to overcome the deficiencies in the organisation and focus on improving the
techniques according to the technological up gradations (Kotter, 2012).
Globalization- It refers to expansion and diversification of business operations at the
international level. The entry of more and more MNCs creates more competitive environment.
To gain competitive advantage proper allocation of resources should be made. With reference to
ZARA, it has gain competitive advantage in the overall market due to which is has been
popularised as the famous brand being recognized by everyone. Whereas, PRIMARK is not
recognized by large population as it is confined to UK market only.
Impact on leader, individual and team
Leader Individual Team

A leader must examine and
interpret the changes and their
effect on the manpower. They
will change their policies by
adopting a suitable leadership
style as per the situation.
Employees have individual
tasks and resist changes when
it occurs in the organisation.
They should be motivated by
the leaders to accept changes
and work for increasing their
productivity.
manager of team is responsible
for providing direction. Hence,
they must focus on rearranging
their guidelines for team
members which would be
accepted by all.
Remedies to minimise negative impact of change on organizational behaviour
Organizational factors have the power to influence overall business environment. These
factors can be external as well as internal. According to the changing environment working
culture of the organisation changes. Along with this, impacts of such modifications can be both
positive as well as negative. As a result, all these affects the overall operating activities of the
company, which includes its growth and profitability. ZARA and PRIMARK may adopt Bruke
Litwin Model in order to change negative impact which arise due to environmental change on
their business (Jones, 2013)
In the year 1992, Bruke Litwin developed this model. This model was developed by
Litwin in order to understand various parts of an organization. This model is used by various
companies in order to know about the affected areas and their interrelation.
1. External environment- External environment involves factors like markets area,
legislation, competitors and many more. Manager of both the companies should
understand the impact of external environment on the company. ZARA and PRIMARK
major aim is to provide best quality products at low prices. So for this, strategies and
plans are formulated accordingly (Huczynski and et. al., 2013).
2. Mission and Strategy- Every company has its own vision and mission, for which it has
been established. In order to achieve its goals company has to formulate strategies.
ZARA and PRIMARK are operating its business within the same industry, with similar
objective, i.e. to fulfil demands and requirements of customers. Therefore, a strategy has
to be formulate in order to achieve its pre determine goals and mission.

3. Leadership- Leaders behaviour influences the attitudes and behaviours of its sub-
ordinates. As they are the prime member for every team the leader should focus on
motivating the employees and increasing their morale so that productivity increases.
ZARA and PRIMARK are big leading companies emphasising on setting examples for
its rivals and small companies. For this, effective leadership policies and styles must be
amended and implemented in order to survive and gain competitive advantage in the
global market place (Hrebiniak, 2013) .
4. Organizational Culture- It refers to the beliefs and values which exist within the
organization. Cultural changes evolves over the time period as a result of various
different changes in the organization. The manager of the companies should interpret and
keep in mind the desired state for the company. This will be in terms of how they expect
employees to behave within an organisation.
5. Structure- With strong external forces company has to change its organisational
structure. Re-engineering or restructure affect the relationships, responsibilities and many
other factors. Manager of ZARA and PRIMARK should examine and understand
different factors which affect its business operations. For this strategies are formulated in
order to meet customer's expectations and requirements.
6. Task and individual abilities- Modification or changes at higher level of the company
will often involve changes in the working style and skills. Managers of both the company
should recruit right person at right place. Also recruitment and selection has been done
internally as well as externally.
7. Employee Motivation- In order to keep their employees motivated, leaders should make
some efforts, so that work can be done in an effective manner, and results can be
achieved accordingly. So for this, managers of both the companies should conduct
motivation session on a regular basis( (Doctoral Hintz, 2012)

LO3
Different barriers for change and their impact on leadership decision-making
Effective understanding of change management aids a business organisation to frame
formative and innovative strategies which will further benefit in evaluating and implementing
changes. Change is a continuous process which plays and key essential role in every aspect of
business organisation. ZARA and PRIMARK managers’ main aim by bringing change in their
business functioning is related to effective enhancement and maintenance of production
environment of company day to day business basis:
Barriers of change management: It is not necessary that every individual adopts change
thus it will lead towards creation of barriers within organisational change culture. Barriers
creates gap that eventually put negative impact of company day to day functioning of production
process of ZARA and PRIMARK. Mentioned below there are various barriers of change
management described below:
Lack of Employee Involvement:
It is one of the most notices barriers in change management. Workers mainly tend to
resist change and have negative approach towards it as they have fear to get replaced. In context
with ZARA and PRIMARK, it is seen that even some of the most loyal employees of company
resists change which lead towards creation of fear in the. All this happen because of less
involvement of employees in company decision making and policy formation process. This lead
towards adversely affecting manager decision making process.
Lack of Effective Communication Strategy:
There are many businesses organisations those who are facing lack in effective
implementation of communication strategies that shows that they do not able to communicate
policies to their employees. ZARA and PRIMARK managers and top level leaders assured that
once the change is implemented it will be adopted by their workers. This will adversely lead for,
employees resist towards change and make leadership ineffective as they lost employees trust.
Forcefield Model of change management is also described below:
This model acts as a key approach in order to study change management. This approach
was coined by Professor Kurt Lewin and consists restraining and facilitating factors of change:
Facilitating Factors:

In this factor those elements are including that encourage effective adoption of
change. Factors that are including in this includes, outdated machinery, and requirement
of alteration in structure and processes. In these leaders plays a key essential role to align
behavioural characteristics of each individual towards effective adoption of change
within an organisational premise.
Restraining factor:
In this factor there are different types of elements that are present in and outside
of the business organisation which effectively encourages change adoption in an
organisation. Some of that factor includes government regulations, employee resistance
and consumer that resist adoption of change.
(Source : Lewin's Force Field Model (Change Management). 2018)
Illustration 1: Lewin's Force Field Model (Change Management)

Negative factor of changes behaviour: Negative factors of changing behaviour create the
mismanagement with in the company. By this other employees can also get affected so that they
can not be able to achieve their desired goals effectively. This is happen because some time
organisation is not able to guide their each employee easily so that this situation develop
different types of conflicts in a business organizations. There are few negative factors which are
given below:
Communication problem: These problems can be occur anywhere or between the
people who want to talk each other and also define their requirement and needs but they are not
getting their points so in this situation issues can be developed in an effective manner. There are
several kind of issues in the communication like relationships problems with team members with
in the company, inability to explain feelings etc.
Inadequate information: It is little bit difficult in order to calculate the benefits of the
firm. This is because at the present time almost employees have several kind of benefits and
rewards point like extra incentives and avoid paying a large tax for the public goods effectively.
Therefore, this situation makes people behaviour change in a negative way so that they can not
connet with other people in the industry.
LO4
Leadership approaches to deal with organizational change
In a changing environment of organisation, responsibilities of a leader are considered as
most important aspect for an organisation and also for their employees. Along with this, success
rate of change taking place in organisation is completely depends on the approaches of a leader
and also on the styles used by them to handle problems and issues their organisation facing while
the time change. The leadership approaches that leader of Mark & Spencer can adopt at the time
of organizational change are as follow: -
Laissez–Faire: This is a type of leadership which leaders of Mark and Spencer can adopt,
and is also known as delegative approach of leadership. In this leader of Mark and Spencer use to
take their charge back and use to give rights to their employees that they can take decisions. This
approach is helpful in a working environment where work force is full of employees who are