1. What elements of “Kotter (2000)” can be applied to the case study?
The following elements of Kotter (2000) can be applied to the case study:
Establish a sense of urgency
Traditionally manufacturers of sewing machines were located in Germany, Japan and United States; now they have expanded to low cost region of the world which includes China, Korea and Taiwan. The main competitors in Canada were two Japanese manufacturers; Brother International Corporation and Juki Sewing Machine Company, Juki was the market leader but appreciating yen and technological advancements gave an edge to other foreign competitors.
Creating the Vision
Strategies must be developed to lead the organization throughout the change as whenever a change takes place individuals in the organization goes through emotional rollercoaster and the organization has to bear growing pains which includes drop in productivity levels, absences, lack of morale and motivation and resignations. A clear cut vision must guide the managers how to lead organization and its employees through the time of pain and emotional rollercoaster.
Communicating the Vision
Once vision is created, managers must make sure that the vision is properly communicated to all employees; it must be ensured that all employees understand the vision clearly; there is no chaos, no confusion, and no need of further explanations. In this particular case it should be ensured that the vision is communicated to all markets and distributors (stakeholders) throughout the globe.
Empowerment of others to act on the vision
Changing systems and structures that seriously undermine the vision. Recognizing and rewarding the employees that are involved in the improvements. Encourage risk taking and nontraditional ideas, activities and actions. Knock down the barriers resisting transformation. Whenever change takes place in an organization the greatest problem is of “ME Issues” it makes employees become self-centered and there is minimal team work, Me Issues must be resolved for a focused team effort. Managers must identify where they themselves are, their organization is and their employees are on the emotional roller coaster in order to empower others to act on the vision.
Planning and creating for short-term wins
Planning should be done for visible performances of employees even if they achieve some targets their efforts must be recognized on organizational level for example they are awarded with employee of the month award and so on or their efforts are recognized in the organizational pamphlets.
Consolidating improvements and producing still more change
Small improvements must be consolidated together and change whenever brought about must be brought slowly and gradually in the organization so that all employees are used to the change and do not panic if change comes too soon in front of them. They should be communicated properly about the change and must be guided throughout the change process.
Institutionalizing new approaches
Changes brought about in the organization and the benefits reaped from those changes must be communicated to employees to build their confidence that the change was for the success of the organization.
1. What issues are important for me if I was the change agent of the company regarding the “kaleidoscope model”?
Design Choices: Andrew had laid 3 design choices for the company which is:
Consolidate the business
Sell or eliminate all marginal business so emphasis can be paid on core business which is selling and servicing new and used Juki sewing machines and their parts. Focused will be paid on 100 most profitable customers, rest will be handled by dealers.
Low cost and high service parts programs will be implemented. Practices will be adopted which improves efficiency of operations. Furthermore, costs of goods sold will be lowered.
Direct accountability of customers will be made by assigning H&R sales representative to a customer.
Sell consumables rather than machines
Maintenance, Repair and Operations (MRO) involves supplying the products needed to keep manufacturing facilities up and running; the items which are bought infrequently raise the cost of doing business. Thus, H&R will offer MRO products to manufacturers that want to lower these costs.
Niche market will be targeted in either garment or non-garment that has a sustainable market, good management, requires continued cost reduction and requires high quality service for parts and supplies.
Profitability of operations will be derived from negotiations on discounts, sourcing less expensive parts to OEM facilities at the same time not compromising on quality. Ensuring margin between revenue and cost is not consumed by cost of operations.
H&R will copy practices of companies that provide MRO products to customers in the other industries.
Move H&R from sewing machines to other related industries
H&R can become a leasing company. There are many customers including the company that wants to lease the equipment, the manufacturer/distributor that wants to sell the equipment, leasing brokers, and the lenders that provide H&R’s financing. In order to go into this leasing business H&R needs to attracts brokers which act as an agent for a leasing company.
Leasing companies can buy cheap equipments, can sell returned equipment in auctions, can charge lessees for the terms of contract, additional costs or revenue and so on.
H&R needs to find lenders willing to participate so that they have the money needed to finance an inventory of equipment. Build a broad portfolio of leases secured by the assets of lessees so that risk is reduced. Have the technical knowledge needed to audit returned equipment and to then restore or sell it.
2. How can I apply the “kaleidoscope model” in relation to the three different options of change in the case study? Explain in detail each one of the contextual features of the “kaleidoscope model”.
Model 1: Can be done in a short time span as no expansions need to done or no new line of business needs to opened up.
Model 2: It requires time more than the first option as analysis of MRO in other industries needs to need and furthermore, indirectly the target market is being redefined in this scenario.
Model 3: It requires time to set up the business, to gather all equipments which are eligible for sales, finding trustworthy brokers, organizing auctions and attracting public.
Model 1: Low degree of change is required as core business activity will remain the same.
Model 2: High degree of change is required as the core function is being changed from selling sewing machines to consumables.
Model 3: High degree of change is required as the industry is being changed.
Model 1: Most of the organization’s characteristics and resources needs to be maintained including inventories as core business will remain the same. Competition with dealers will continue on large retail sales.
Model 2: Manufacturing facilities needs to be kept up and in running condition. No compromise on quality will be made and margins will be kept up between revenue and the costs.
Model 3: Equipments to be maintained properly over the leasing period so they could be auctioned. Repairs, maintenance and insurance can be provided along with leasing services.
Model 1: High diversity as the business is wide spread throughout the globe.
Model 2: Low diversity as supply will be handled by MRO independently.
Model 3: Medium as customers are mixed including customers, manufacturers, distributors, brokers and so on.
Model 1: High capability as each customer will be assigned to an individual H&R sales representative.
Model 2: Low capability as operating practices of MRO will be copied.
Model 3: They have technical knowledge but require finance.
Model 1: No or minimal change in resources are required.
Model 2: Resources require change from sewing machine to consumable products.
Model 3: Equipments can be leased rest all resources needs to changed.
Model 1: They are ready.
Model 2: Training and a lot of learning is required.
Model 3: Needs to protect its work force.
Model 1: Direct accountability will be created.
Model 2: Tough management and execution phases.
Model 3: Impose rigorous control systems and processes.
3. What is the most appropriate type of change for Andrew Rosenfeldt to use regarding the case study?
Model 1: Since core business activity in this scenario will remain same thus no big changes are required and there is no need of adaptation.
Model 2: Employees need to be trained properly so they can adapt to new processes. They need to identify suppliers of MRO, evaluate them, negotiate prices, produce price and avail files, order products, maintain inventories, bill customers, and pay suppliers.
Model 3: Scope of business will be changed from selling sewing machines and its parts to leasing business. Employees need to be adapted to the new business format soon.
Model 1: No specify re-construction is required just some change in activities at small scale will take place like every customer will be assigned to H&R sales representatives and will be held accountable separately.
Model 2: Employees have to adapt to new ways of working by copying the MRO practices; there is no particular choice left.
Model 3: Employees have to adopt the practices of a leasing firm and not merely a selling firm.
Model 1: The change is properly planned as they have already decided that each customer will be assigned to separate sales representatives in order to entertain direct accountability.
Model 2: Here the change is somewhat planned as they know they will copy the practices of MRO products to customers in different industries but they haven’t identified exactly what products, which industries and to what extent will the MRO products be copied.
Model 3: The change is not well planned, they just know what they have to do like open a leasing company and those they require brokers but the objectives are not properly identified like where the leasing business will be carried on, who will be the brokers and so on.
Model 1: Direct accountability will be introduced
Model 2: Scope of business will change from selling sewing machines to some consumable business.
Model 3: Industry will change to a leasing company.