Managing Change

Executive Summary

The organization had clearly convey the message that persistent market downturn is killing the company. In fact, the whole industry is in crisis, a lot of companies are merging or closing down. We need to make some critical changes to ensure our organization does not suffer the same fate.

CEO also defined the new vision and strategy “Evolution of our core strength”. This vision got complete buy in from all senior executives from the organization from CEO to Regional Directors. It is now the responsibility of all the Regional Directors to cascade the vision all the way throughout the globe.

The changes introduced are designed to build on our strength. Regional Directors will need to form a change team in each region and implement these changes. Ensuring the correct positive message will be conveyed. We are not solving a problem but building on what we had done successfully in the past with a few twigs to meet the ever changing market environment. And the emotional factors need to be taken into consideration as we are a organization that really cares. This proposal will provide guidelines to the Regional Directors on implementing the changes from his perspective.

Introduction

Changes is in the progress of been implemented in the region to make the organization more efficient and effective. With successful implementation of this change, the organization is expected to be profitable once again. These changes will make the organization more flexible yet cohesive towards a common vision and strategy. A BCG study concluded that organization today must shift their business models and their leadership skills to become more adaptive firms which will give them the adaptive advantage to navigate through current VUCA world. (Chadha S. 2007) External and internal fit with its environment calls for a business to have adaptive, multiple loop responses to the complex problem of renewal in a VUCA world. (Vikram M & Aasha M. 2014)

Internally within the organization, it is a huge change for every single employees involved. As with other region, it will be managed under a new matrix structure which is completely new to most of our staffs. Most managers’ role in the new structure had been changed as the original position had been made redundant. Externally towards our suppliers and clients, new structure also changed the way the company operates. Our employees had to identify and appoint new point of contact as well as putting amended contracts in place quickly. We also need to review practically every process on how the organization conducts her business from marketing to operation to supporting functions.

Background to the Situation of the Change

The region is originally made of up over 20 individual companies. Each has her own General Manager to run it independently. The General Manager had autonomy over every decision of the company from HR to SCM to financial to operation. Under the new structure, regional management team had been formed headed by a Regional director. This is creating stiff competition among the General managers to secure this position. Once in place, he will need the time to gain trust and respect from his former peers which he will now lead in the new structure.

These problems can be narrowed down to Change and Transition uncertainty during the implementation of such huge changes in the organization. How can we as leaders help our employees deal with the transition psychologically? How do we motivate our employees to ensure this change “stays implemented” to achieve the objective? With change, we usually focus on the outcome. While with transition, the starting point is the ending, leaving the old situation behind. (Bridges W. 2009) In this report we will look into “managing change and transition” within the organization from the Regional director’s point of view.

Diagnosis of the Change

Firstly, change of organization structure and reporting line. Regional management team headed by Regional Director will be put in place with the removal of General Manager’s autonomous position in local business units. Almost everyone had multiple reporting lines rather than a simple vertical reporting line. We need to keep in mind, most of the staffs will be going through a change of leadership with new reporting line. This aspect alone needs to be look at carefully by the new Regional Director. “Such transitions are periods of vulnerability and opportunity. Failure to adapt and perform effectively and quickly in the new role can be costly both to the individual and to the organization.” (Levin I M. 2010)

In this region, there are 2 business lines and 12 service lines. Business managers role will be set up and they will only be responsible for the Profit & Loss for each of these business line and service line. Most of the General manager will be reassigned to these roles. It will be a tough change for most of them as it felt like a demotion. They will lose most of their executive power with regionalization of functional roles. Some good General managers had already decided to leave the company as they felt being under appreciated and humiliated. “When people are left on their own to make the connections, they sometimes create very inaccurate links.” (Kotter. 1995). In actual fact, this still a key role in the new structure which will directly determined the performance of the region. These roles are also the window to our clients, representing the branding of our organization. Internally, it is still a highly visible role from top to bottom of the organization, together with all the prize and glory.

To consolidate HR, SCM, financial, IT, Law & Taxation in each company into one regional shared support function respectively. This consolidation will be a huge, tedious and messy process. Imagine the daunting task of integrating over 20 independent companies which used multiple different system and processes into ONE single system and process. The functional managers will be under tremendous pressure to complete this “change” quick and effectively. In addition, he will also need to make a lot of employees redundant which will affect the morale of everyone and made them resistive to the change that need to be carried out. But it will also be the biggest cost saving measure of this re-structuring. We will need to motivate them to think positively and convey the vision across else the effort can easily be dissolved into a list of confusing and incompatible projects that can take the organization in the wrong direction or nowhere at all. (Kotter. 1995). Those who we kept will definitely be better rewarded if the change is implemented successfully. We need to manage this transition carefully, leading the employees through the 3 phases; Ending the old ways, Neutral zone and finally the New beginning.