Organizational Change Management Failure: A Case Study of XYZ Ltd

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ORGANIZATIONAL BEHAVIOUR - ASSIGNMENT 2
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CASE STUDY
“The destiny of XYZ Ltd: Ignorance of Roots”
Quoting Barack Obama, “Change will not come if we wait for some other person or some
other time. We are the ones we’ve been waiting for. We are the change that we seek.”
Sometimes even successful and effective business enterprises have to go through an
organizational change to seek success and walk in the pace of dynamic business environment.
Organizational change and its management is a rigorous process which requires effective
management and process management. The case study of Mitchell working in XYZ Ltd. a small
business enterprise dealing in various consumer goods related to daily essentials. XYZ Ltd.
recently started the business services online through the development of own website and online
portals. The expansion in business and its services has altered the structure of the organization
and its management. Mitchell is working as the operation manager at the organization. She is
responsible to look into various departments and their activities in order to accomplish the
organizational aims and objectives.
Mitchell was also working as an administrative manager looking into different matters and
conflicts occurring in different areas of the organization. Mitchell was best of friends with David
the owner of this small business enterprise. Mitchell and David had a good understanding and
developed a strengthened bond over time. Mitchell witnessed an increased level of burden on
David with him implementing and developing online business strategies and portals for the
business. The adoption of online business services required the development of websites,
assigning of product procurement, supply chain management, consumer relations etc. David
divided the existing workforce for the online division and created a burden on the on store
purchases and consumer management.
With increased levels of work and supervision, David witnessed the needs of increased speed
and less bureaucracy. Mitchell advised David to eliminate positions in order to stay lean and fast.
Both Mitchell and David agreed to layoff existing positions and introduce new positions for
online services. The organizational structure and policies were rigorously altered and reduced in
different dimensions in order to develop the online business services and activities. The
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transition of the business from retail store to retailing online includes for immense organizational
change in the structure and policies.
Changes in job roles and profiles of the on store employees towards online store management
created various issues and conflicts in the organization. Mitchell witnessed the sense of anger in
the employees who were not selected for the online processes and this created differences in
employee’s mindsets and thinking. The employees who were retrenched as a result of a deep
organizational change in structure and bureaucracy were a result of unplanned and impulsive
decision on the part of David. Employees were dismissed from employment in order to act as a
cost saving activity and planning for the sources of finances. The employees dismissed created a
burden on an already existing employee in the store. David required discussing the acts and
changes in organization policy and structure with the employees in order let them understand the
need for retention and future possibilities in the organization (Yidong & Xinxin, 2013). The
unplanned employee retrenchment also resulted in the loss of some major talent loss as
employees were leaving as soon as they found a better alternative as a result of future security in
the same organization. Mitchell witnessed immense possibilities and opportunities for various
employees who left the organization and in some who were fired by David in the heat of the
moment.
The online business was glomming and growing which fetched all of the attention and time for
David. While Mitchell was struggling with supervising both the online and offline business,
David wholly focused on the online business in all respects. On store business and processes
were falling down simultaneously as a result of increased burden and pressure on the already
existing staff for XYZ Ltd. A number of consumers witnessed different issues in the operations
of the store and identified decreased levels of services. Earlier David used to interact with
consumers and had developed personal relations with them. Now David hardly knew any new
consumers and failed in developing relationships even with the employees.
The business failed to identify the importance of intergroup development, team building, and
process consultation before venturing into the online business and dealings. The business was
required to identify the forces developing a change in the organization and make an effective
understanding of the changes towards the employees (Short, et. al., 2018). According to Mitchell
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most of the employees were uncertain of the online diversifications and left the organization as
soon as they observed an opportunity in a different business. The loss of talented employees and
experienced employees at the store decreased the performance and revenues for the business.
Mitchell often stressed over the unfortunate state of conditions at the store to David to which his
response was “the online services and sales are enough to pay off the losses suffered on the
store”.
In the initial phrase, both David and Mitchell observed opposing views and attitudes of
employees towards online services. The employees working at the store where not technically
and managerial adequate to function in the online services and operation, therefore massive
opposing attitude was observed. In this situation, Mitchell often suggested talking with the
employees along with David to explain to them the need for online services and opportunities
provided to the employees for developing the required qualifications and skills. The business
failed to educate the employees about future opportunities in order to develop according to the
business requirements and lost various essential employees (Yidon & Xinxin, 2013). David was
engrossed with rampant hiring in the technical sector of the business for both operating and
managing the online business.
David’s impulsive decisions and alteration in the business functions and processes were causing
a reduced number of sales and revenues for the store. The organizational behavior build by
David towards his employees and the store processes were ignorant of the fact the roots of this
business. Mitchell often confiscated the fact of David’s ignorance leads to massive alterations in
the organizational behavior. The employees would often resist in smallest of the operational
functions and would complaint of increased burden. The employees according to Mitchell were
cooperative and worked as a family before David invested in the online business services and
functions. With an increased focus over online services disturbed the status quo of the
organization. Tussles and issues were are a common scenario at the store between the online and
store. The omissions and differences in online orders or any misinterpretation of the orders
resulted in a conflict between the managers. The online managers would blame on store
managers in the purpose of packing and identifying the correct orders. The conflicts and issues
amongst these managers resulted in returns and cancellation of orders on the website which
impacted on the business values and services.
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David would often blame and disregard the aspect of on store managers which instigated a sense
of disparity amongst the on store employees and managers. Increased level of freedom and
regards given to the online store managers provided them with mala fide interest and power to
the workers. This worsened the situations at the store and on the online functions of the business.
David and Mitchell should have adopted Lewin’s three step change model which provided with
three stages of change and its management in an organization (DuBrin, 2013). The three stages
are unfreezing, movement and refreezing. The first stage is where efforts are planned to
overcome the resistance from both the individual and the group in order to implement the
changes and planned policies. The next stage is implementation and adoption where the change
is actually implemented in the organization by following the alterations and changes (Leana, et.
al., 2012). The last stage is where the conditions are stabilized by balancing the driving and
restraining forces of change. Following this approach with integration of planned change and
employee integration would have aided David and Mitchell to sustain the functions and
processes at the organization.
Days passed with tussles and conflict between the online store and on store managers. The
services at store deteriorated and reduced the sales at various levels. David left the online
services majorly over the managers and employees with minimum interference and decision
making. Mitchell struggled to undertake the expenses of the store with less or no sales and
revenues. Therefore both of them decided to close down the store and operate it as a warehouse
for the online services. Mitchell the company and bid a farewell to the workers and David with a
heavy heart. The online store is running on a minimum bare and only recurring the business at a
breakeven point. David is now struggling to pay off the loans and advances undertaken to
manage the online services and often compelled on the fact ignoring his roots with the closure of
the store.
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Q1. Analyze the ways in which change is manifested in the above case study?
The above case study is a classic example of the failure of implementing change in an
organization. The case study has to present failure of implementing change a shift from on store
business operations to online business operations. It has been identified in the case study that the
shift applied in this organization was a failure as David the manager failed to inform and interact
with the employees about the changes undertaken in the organization.
David neglected the importance of implementing a planned change through an effective
approach to change management. From the readings of the case study, it has been analyzed that
David was required to educate the change and its dimensions to the employees to reduce the
resistance of employees from accepting the change (Shin, et. al., 2017). Informing the change to
the employees would have aided David and Mitchell in implementing the change and receiving
the returns on a higher level. Planned change creates opportunities to implement proactive and
purposeful activities in the direction of implementing changes in an organization. Planned
change is required to improvise the ability of organization in adapting the change and effectively
undertaking activities to support for its management.
The case study lacked in adopting an effective and coordinated approach in implementing the
change. It has been identified for ensuring a successful and effective application of change David
was required to adapt the change model developed by Lewin. The mode describes for developing
three stages of change and its management. According to the model, the first stage is where the
unfreezing of the organization is undertaken in order to overcome the resistance towards change
(Short, et. al., 2018). The next stage is a movement where change is slowly implied and adoption
to change is undertaken. Last is refreezing where interventions are undertaken to support for
driving forces of change and reducing the resistance posed by the internal or external
environment.
Q2. Analyze issues that influence the behavior of in the workplace?
There are various factors and issues that influence the work behaviors for different individuals.
The issues identified in the case study include for ineffective communication channels,
unplanned change, lack of leadership and managerial support, ineffective decision making
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systems and lack of employee engagement. The issue of unplanned change and lack of
leadership are identified as the most disruptive issues for the above case study.
David the business manager and owner for XYZ ltd. failed to lead and manage the workforce in
an effective where change was being implemented in the organization. The management style
adopted by David towards his employees injected a sense of no belonging in the mind sets of the
employees (DuBrin, 2013). The expansion into online business services for the business where
not introduced to the employees which impacted on their performance and work related attitudes.
The scenario of David firing the traditional workers and employees in order to cost cut for on the
online services severely impacted the business finances and the performance. The management
style and leadership of neglecting the traditional workers and providing the online workers with
increased freedom to operate business created differences.
The lack of employee engagement and ineffective decision making system also impacts the
performance and work related behaviors for the employees. The workers at XYX ltd worked for
a family and developed a bond on personal and professional levels. The workers later developed
a distinctive attitude depicting refusing for operational chores, reduced coordination and rampant
resignations without prior discussions with either David or Mitchell. These issue presented in the
case study have impacted on the employee and their behaviors in the workplace in a negative
manner.
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References
 DuBrin, A. J. (2013). Fundamentals of organizational behavior: An applied perspective.
Elsevier.
 Leana, C. R., Mittal, V., & Stiehl, E. (2012). PERSPECTIVE—Organizational behavior
and the working poor. Organization Science, 23(3), 888-906.
 Shin, Y., Kim, M. S., Choi, J. N., Kim, M., & Oh, W. K. (2017). Does leader-follower
regulatory fit matter? The role of regulatory fit in followers’ organizational citizenship
behavior. Journal of Management, 43(4), 1211-1233.
 Short, J. C., McKenny, A. F., & Reid, S. W. (2018). More than words? Computer-aided
text analysis in organizational behavior and psychology research. Annual Review of
Organizational Psychology and Organizational Behavior, 5, 415-435.
 Yidong, T., & Xinxin, L. (2013). How ethical leadership influence employees’ innovative
work behavior: A perspective of intrinsic motivation. Journal of business ethics, 116(2),
441-455.
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