Organizational Strategic Change - Report Example

Organizational Strategic Change Name Institution Date Task 1 The three models of change management McKinsey 7-S Model The model was developed in 1978 by Robert Waterman and Tom Peters. They developed the model when they were still employees at Mckinsey and Company. Robert waterman and tom peters came up with seven different factors that form a part of the model. The seven factors include: Strategy Shared values Structure Style Staff Skills Systems Among the seven factors, shared values are the pillar of model since they are what the company normally believes in and stand for. A good example of such value is the company’s mission. Strategy illustrates what an organization plans to do or response to a given changes in its external environment. Structure refers to the company’s organizational structure. Systems on the other hand are part of the model that illustrates the procedures, routines and processes that features the way work need to be done. In the model, Staff is a suitable representation of a person that needs to be employed and what he or she is doing in the organization. As a factor among the seven factors in the model, style means the culture and styles of management that are normally applied in an organization. Skills, a factor in the model, indicate the capabilities and competencies of both the workers and the organization holistically (Koller & Goedhart, 2010). Lewinn’s change management model Lewinn’s change management model was created by Kurt Lewin a psychologist in early 1950s. Lewin suggested the following three phases of change (Straatmeijer, 2009). Unfreeze Transition Refreeze Paton and McCalman (2008) argues that the model assumes that majority of individuals tends to stay in a particular safe positions and are uncertain about the change. This kind of individuals, according to the model, tend to be more comfortable in this static surrounding and feels uncomfortable when a certain change is introduced, even if the change is minor. The model therefore suggest that in order to do away with the frozen state, it is important to commence an unfreeze period, which can be done via motivation. Motivation is very essential in any company, even if it is not changing. The period of transition is when the change is happening. According to the model, the transition period is always a journey and not a step. The transition period normally lasts for some time because individuals do not naturally like change. The next stage after the transitional journey is the refreeze stage. The refreeze stage, according to the model, is the stage in which a company resumes its stable state (Paton & McCalman, 2008). Kotter’s eight step change model This model suggests that for successful change to occur, eight steps need to be followed. The eight steps that suggested in the model are: Enhance urgency for change Creating a team for change Build the vision Converse or communicate Empower Developing short term goals Be persistent Make change permanent According to Cameron and Green (2004), the first step in the model is to develop urgency for change. This therefore implies that the workers need to be convinced that change is significant for an organization to survive. It also implies that the employees need to be informed that change can be attained minus any harmful impacts on their jobs. The next step in the model is to create a team for change. The team needs to be of some respected workers in the organization. Constructing the vision is the third step in the model. This step is believed to display clear direction on how the change will benefit the company and employees in future. The fourth step is communicating the vision. The fifth step in the model is to empower the workers to implement the change. It is therefore essential for management to follow similar guidelines as the ones followed by workers. According to the model, developing short term goals is important since it helps workers to accept the change. Rewards are also significant at this step. The seventh step in the model is about persistence. This is because more change need to be influenced even after the short term goals are achieved or the initial plan for change has ceased. The final step in the model is to create the change permanent by fitting it into the culture and practices of the company such as promotion (Cameron & Green, 2004). An appropriate model of change in AEGON UK and reasons for the model An appropriate model of change for AEGON UK is Kotter’s Eight Step Change Model. Eight step model change model is appropriate since it is a simple model. The model prepares workers of an organization even before the vision is developed, which implies that the real transition is much simpler in the long run. As compared to other models, eight step change model has fewer limitations. The model is generally the best fit for many organizations since substantial change is required for the divisions. The model can also assist to ease the transition because the division has a history as compared to the rest of the organization. People therefore cannot be set in the ways as they could be if the division had been around for long (Nilakant & Ramnarayan, 2006). The value of strategic intervention techniques in modern day organization It is very true that some form of strategic planning is essential to future performance of organizations. However, there are a number of challenges for executing this type of planning within a company. Large group interventions are among the methods that are applied in addressing the challenges. Strategic planning in AEGON UK means planning for the long-term. The time frame that is normally linked with this type of planning is approximately three to five years. Because of the time frame, there are a number of challenges that are linked with long-range planning. The challenges include developing a strategy that advance in its direction rather than more similar, making stakeholders to be committed with the strategies of the organization, following through the implementation of crucial activities and minimization of time cycle in the process of planning. In the modern world, organizations cannot manage these challenges. For organizations to survive, they need to be able to rapidly make, deploy and execute breakthrough plans that assist them to continually expect and achieve current and upcoming customer needs. By doing this, organizations need to be able to arrange all external and internal resources around the plan. This type of direction requires approaches to strategic planning that entails every employee and stakeholder in the process of planning that can happen in a shortened time frame (Mathews, 2005). Mathews (2005) argues that the intervention techniques that can be applied in AEGON are Large Group Intervention Techniques. Several large group intervention techniques have developed over the last twenty years. As such, the techniques have been useful instruments in dealing with a number of issues that are linked with strategic planning. The intervention techniques incorporate: Design, Participative design, Work-Outs, Simu-Real and Open Space Technology. Large group interventions techniques have been applied successfully in many industries. The techniques therefore can be effective for AEGON UK. TASK TWO Understand issues relating to strategic change in the organization Generic background to change that exists in modern economy and the specific drivers that motivated AEGON UK to consider change. Currently, the world seems to be integrating politically, culturally and economically. Regardless of national borders, vast advancements in communication, information and technology has occurred. Patterns of ownership of corporate sector worldwide have become more complicated like combined ventures and cross-border acquisitions. International strategies have developed in goods and services production, labor management and distribution. These have created a huge effect on business activities. The globe economy is currently more strongly interlinked and the finance has turned out to be a global resource (Wenderoth, 2009). In the modern economic situations organizations are experiencing the external and internal forces that can finally make change unavoidable. External forces such as modern workforce demographics, changing expectations that concerns quality, customer satisfaction and quality, and current technologies are radically affecting the operating surroundings within organizations worldwide. Internally, financial restrictions, the situation to perform more with less, cross-functional organizations, acquisitions and mergers and empowered workers all influences position of organizations to compete in international marketplace. Challenges to organizations are inevitable. Organizations need to ensure that they balance the hopes and demands among stakeholders incorporating workers, customers, management and shareholders. Minus balancing, an organization risks a nervous workforce that might result to production reduction. The size of success of any organization depends on the way the organization decides to inspire, correspond and include change in the workforce. Change therefore is a process not an event (Balogun J. & Hailey, 2008). There have been various deriving forces that have resulted to background of change in AEGON UK. AEGON UK had an international bearing repute but still has never had band awareness by the AEGON’S name in United Kingdom. The financial services products’ philosophy that AEGON was selling was quite hard to know by the possible customers. In United Kingdom, life expectancy has enhanced in recent years. This therefore implies that individuals anticipate for retirement after a long period of time. Many individuals never thought about the importance of planning for retirement, that is, there used to be a derived from government to minimize dependency on state at old age. Therefore, there was a need to develop social awareness among individuals thus benefitting AEGON UK through selling of its financial products. AEGON was not recognized in other areas apart from pension’s areas. These therefore are the specific factors that motivated AEGON UK to consider change. Resources implications of AEGON UK if it failed to respond to the need for strategic change The resources implication will be that the strategic change management plan is not complete. The plan can only be complete if the components such as human requirements, financial requirements, risk assessment and mitigation strategy, estimation of project lifetime, sustainability and exit strategy. The strategic change management plan can only be considered complete if these components are defined in broad terms. A number of these components are normally defined in details and tested with authenticity (Helfat, 2007). TASK 3 Systems for understanding and involving others in the process of change Key stakeholders in AEGON UK and the proposed systems to involve the stakeholders in the planning and implementation of change Stakeholders are individuals who are affected directly by organization’s decisions. Stakeholder might be internal or external. Internal stakeholder may consist of management and workers while external stakeholder might be the government, banks, suppliers, shareholders and media. Various stakeholders have different anticipations from the company. In the change process stakeholders can participate in various ways such as; They can participate in problem solving Being informed of standing about corporate objectives They can act on information received They can mobilize the right resources at the correct time to realize the execution plan AEGON’s new chief executive officer undertook the following actions that could enable stakeholders to participate in the process of change. Simplification of financial services AEGON’S chief executive officer implemented customer focused approach. The approach was adopted so that it could enable customers to participate in the process of change. The complicated financial services were made more understandable by the firm’s CEO. Currently customers understand what they are investing into and what their investment is anticipated to produce. In the past years, customers have often been confused with the complicated calculations. Currently they are amused because they do not require any financial analyst to know the products provided by AEGON in details (Cameron & Green, 2004). Workforce development According to Cameron and Green (2004), an employee is a vital stakeholder in an organization. Employees are essentially the individuals who are responsible for making the process of change successful or not. Before the execution of change, the new CEO took workers in confidence briefed them about the current AEGON’s stand and the future company’s stand. In the next step, that is, developing the new skills that are needed in change implementation, the CEO adopted job rotation that entails progression from a given job to another. This offered each worker with a rational career path. The CEO also organized management development programmed in association with top management college for training workforce. Creating distinct market place In refreshing AEGON’s brand identity in individuals’ mind, the new CEO undertook an external promotional campaign to emphasize the association between the locally familiar Scottish Equitable and AEGON. The CEO also informed the media why change is necessary and how it will be important to stakeholders. Evaluation of the advantages and disadvantages of the systems you proposed in task 3a The above stated systems were utilized to entail various individuals in the change process. Change was demanded because of the external and internal forces pressures that were affecting AEGON’S performance. In AEGON, business was not proceeding well because of various important issues. Because of the issues, the CEO decided to introduce some changes in operation’s line. The CEO assumed the change programme to be fully customer focused and related the whole change process with particular behaviors such as embrace change, think customer, act with integrity, promote excellence, decisive action, team work and communicate. The workers were therefore trained about the behaviors by top management college. The problem with this system was that consumers were not informed about the products and services offered by AEGON. The customers had often been disturbed about knowing their investment policy. They had been unable to make comparison between the services offered by AEGON. The customers also were not aware about the probable outcome on AEGON’S products if they invest in them. The CEO developed the system of training workforce. Workers at the beginning were addressed about the importance of change and the probable suggested changes. It is important that before change implementation, the workforce was able to do their tasks within the new surroundings. The workforce was created purposely with rotating job descriptions and the management development programme was done by top management college that trained workers about change response. The CEO had to respond to important reason for change. This is because AEGON was operating under various trade names within similar geographical location. This therefore is the main reason why AEGON failed to take distinct market place in spite of such a historical background. The CEO talked to the media and explained the whole scenario. A part from this, many measures were also adopted to establish brand position, for example, Scottish Equitable was turned to AEGON Scottish-Equitable, thus representing the local company’s repute and AEGON’s brand. External promotional campaign was also included in the system. How to develop a change management strategy with the key stakeholders Change management strategy can be developed in a number of ways with key stakeholders. Therefore in developing change management strategy, opinions of powerful stakeholders need to be taken into consideration. Their opinion can shape the implementation of change at early stage. The input of key stakeholders can improve the project’s quality. Support from key stakeholders is also important in developing change management strategy. The support from key stakeholders assists in winning more resources. This makes it more probable that the projects will be successful. Early and frequent communication with key stakeholders is important in developing change management strategy. It is essential to ensure that stakeholders know what is being done and the importance of the project (Wenderoth, 2009). Strategy to be used in managing resistance to change in AEGON UK The following strategy can be developed for managing resistance to change in AEGON To manage resistance to change, workflow process can be developed so that the results for workers’ and organization’ mutual gains can be attained. Development of authority process is important since it directs the behavior within the organization’s and its participants’ interests. Reward and penalty process can be developed. The process can induce individuals to behave in a manner that is in line with the interests of the company and its participants. Development of perpetuation process to improve a concept of uniqueness, wholeness and importance of the organization is also essential. This is normally associated with the efforts of selecting and defining clearly known emotional toned symbols, concept or other factors that can assist any participant to identify the organization’s uniqueness as a whole. Communication process needs to be developed because it assists in exchanging information, ideas, values and feelings that are used in all activities. Finally, evaluation process development is important in managing resistance to change in AEGON. The process can establish the criteria for and defines utility’s level and the value of individuals, ideas, materials and activities. TASK 4 Plan To Implement Models for Ensuring Ongoing Change The appropriate models for implementing change that suite AEGON Model for change refers to the general strategy that includes change within the organizational environment. The appropriate models for implementing change in AEGON are eight behavior frameworks. AEGON’s CEO did a SWOT analysis and decided to come up with a new behavioral framework for employees. The framework was known as eight behaviors framework. The CEO also organized workforce managerial training. Simplification of financial services, workforce development and organization of brand awareness campaign was performed by the firm’s CEO. The CEO also informed the media about the process of change. The model implemented therefore brought significant positive change and gave the organization a new line of direction towards achieving the desired goals and objectives (Greene & Kropf, 2009) How implement the models in AEGON The model, eight behavior frameworks, can be implemented by AEGON through rebuilding the brand reputation. The company also needs to be more focused on its customers. It needs also to start providing a lot of innovative products. The company should also become more famous among the consumers. The model can be implemented by introduction of new and ground-breaking products. In case of AEGON, introduction of life annuity can change the manner in which consumers are viewing their retirement income (Rothwell & Gerity, 2004). Improvement Expected and the means of Measurements The implementation of eight behavior frameworks assists the company to concentrate more on customers. The framework is a pre-defined code of how people working in a given organization are expected to behave between themselves and to other individuals outside the organization. Behavioral framework therefore leads to similar ethical and behavioral values to all individuals at every level in an organization (Hellriegel & Slocum, 2007). The framework focuses on eight behavioral values such as: Think customer Change embracement Excellence promotion Integrity performance Decisive actions Team work Learning and growing Relate and communicate As away of measuring AEGON strategy, it is important to carry out an audit that should look at two aspects, which are the internal stand of the organization and how the organization is internally positioned in the respective market. The audit therefore can reveal whether the company is firmly positioned in the market or not. The expertise, creativity and clarity of information among the organization’s workforce can be determined by this measure. The external audit can also assists in determining the position of AEGON and its competitors. The audit is very essential in providing useful vision to the decisions that are required to start the process of change (West, 2007). References Nilakant V. & Ramnarayan S. (2006). Change management: altering mindsets in a global context. New York: SAGE. Paton A.R. & McCalman J. (2008). Change Management: A Guide to Effective Implementation. New York: SAGE Publications Ltd. Cameron E. & Green M. (2004). Making sense of change management: a complete guide to the models, tools & techniques of organizational change. London: Kogan Page Publishers. Straatmeijer J. (2009). A Positive Model of Change. Berlin: VDM Verlag. McArdle G. (2006). Eight Step Change Model, Issue 608. New York: American Society for Training and Development. Mathews C. M. (2005). Strategic intervention in organizations: resolving ethical dilemmas. New York: Sage Publications. Balogun J. & Hailey H. V. (2008). Exploring strategic change. New York: FT Prentice Hall Financial Times. Helfat E. C. (2007). Dynamic capabilities: understanding strategic change in organizations. New York: Wiley-Blackwell. Cameron E. & Green M. (2004). Making sense of change management: a complete guide to the models, tools & techniques of organizational change. London: Kogan Page Publishers. Salaman G. & Asch D. (2003). Strategy and capability: sustaining organizational change. New York: Wiley-Blackwell. Wenderoth M. (2009). Change Management Strategy for Implementing Shared Services. Berlin: GRIN Verlag. Greene R. & Kropf N. (2009). Human Behavior Theory: A Diversity Framework. New York: Transaction Publishers. Hellriegel D. & Slocum W. J. (2007). Organizational behavior. London: Cengage Learning. Koller T. & Goedhart M. (2010). Valuation: Measuring and Managing the Value of Companies. New York: John Wiley and Sons. West J.C. (2007). Workforce development in the context of organizations, leadership, and postmodern thought. New York: University of Phoenix. Rothwell J.W. & Gerity E.P. (2004). Linking training to performance: a guide for workforce development professionals. New York: Amer. Assn. of Community Col. Read More