Today, teams and organizations face rapid change like never before. Globalization has increased the markets and opportunities for more growth and revenue. However, increasingly diverse markets have a wide variety of needs and expectations that must be understood if they are to become strong customers and collaborators. The ability to manage change in an organisation, while continuing to meet the needs of stakeholders, is a very important skill required by today’s leaders and managers. Organizational change is undertaken to improve the performance of the organization or a part of the organization, for example, a process or team. When an organizational system is disturbed by some internal or external force, the change may occur. The change is modification of the structure or process of a system that may be positive or negative. It disturbs the existing equilibrium or status quo in an organization and may affect the whole organization, or various other parts of the organization in varying degrees of speed and significance. It may affect people, structure, technology, and other elements of an organization.
It may be reactive or proactive in nature. When change takes place due to external forces, it is called reactive change. However, proactive change is initiated by the management on its own to enhance the organizational effectiveness. The change is one of the most critical aspects of effective management. Organizational change is the process by which organizations move from their present state to some desired future state to increase their effectiveness. The goal of planned organizational change is to find new or improved ways of using resources and capabilities in order to increase an organization’s ability to create value and improve returns to its stakeholders. An organization in decline may need to restructure its resources to improve its fit with the environment. According to Ackerman (1997) organisational change can be distinguished in three types, namely, developmental change, transitional change and transformational change. Developmental change refers to organisational change in which what already exists is continually improved but no radical progress is achieved or aimed at.
Transitional change is a shift in the way a process is completed or designed to increase efficiency. A transitional change could involve the automation of a manufacturing process that was once done by hand. Transformational change refers to a shift in the business culture of an organisation resulting from a change in the underlying strategy and processes that the organisation has used in the past. A transformational change is designed to be organisation-wide and is enacted over a period of time. Significant organizational change occurs, for example, when an organization changes its overall strategy for success, adds or removes a major section or practice, and/or wants to change the very nature by which it operates. It also occurs when an organization evolves through various life cycles, just like people must successfully evolve through life cycles. For organizations to develop, they often must undergo significant change at various points in their development.
That’s why the topic of organizational change and development has become widespread in communications about business, organizations, leadership and management. Leaders and managers continually make efforts to accomplish successful and significant change as it’s inherent in their jobs. Some are very good at this effort (probably more than we realize), while others continually struggle and fail. That’s often the difference between people who thrive in their roles and those that get shuttled around from job to job, ultimately settling into a role where they’re frustrated and ineffective. In this paper, it will be explained how the Digicel Corporation has converted from the traditional model to a transformed organizational model over the last five years. Digicel Corporation ia a telecommunication based company who provides land line, internet services, sale of handsets, credit for pay as you go customers, contract accounts, sale of tablets, etc. Digicel opened its very first store in 2001 by Irishman Denis O’brian. Digicel has transformed from a company into the region’s largest telephone corporations, leading in sales year after year.
One of Denis O’brian techniques for change is technological changes. By the 2000’s the organisation had been so successful and had more increasing growth than any other telecommunication companies in the Eastern Caribbean region resulting in the purchase of AT&T in St. Lucia. Digicel provides consumers with low prices under the slogan “The Bigger Better Network” (digicel.com). The price sensitive merchandise allows customers to get more for their dollar. Digicel offers its customers 24 hours a day, seven days a week services, which is appealing in any retail market. The goal is to satisfy the growing telecommunication needs of customers. The best example of this organisational change that I can think of is the globalization of Digicel. This Organisational change began in 2001 when Denis O’brian opened in Jamaica.
This was the beginning of Digicel’s vision of becoming an international company. Since then, Digicel has been aggressively expanding its markets and investments throughout the Eastern Caribbean Region, and Ireland. The company currently has operations in a number of countries including Ireland, Central America, Oceania, Jamaica, St. Lucia, Barbados, St. Kitts & Nevis, St. Vincent, Dominica, Antigua, Panama, Bermuda and Grenada to name a few. Digicel also employs more than 5,500 associates worldwide, with more than 1000 stores currently in operation. Digicel is committed to achieving leadership as a telecommunication service provider. In order to achieve this goal, it has implemented specific business strategies that include globalization.
Digicel leaders believe that globalization is critical to the company’s growth and continued success. In its quest to remain competitive, Digicel is pressing onward on its mission of seeking new opportunities, innovations, solutions, and talent in the global markets. Major advances in technology and communication and the growth of the Internet have also made it possible for Digicel to conduct and manage business globally. The company’s utilization of technology has been and will continue to be critical in its business success. Digicel being a communication company, along with other global companies are now dependent heavily on electronic communication devices to conduct business transactions. Integration of enhanced information system has a significant impact on the way Digicel collects, access, and disseminate information. Technological innovations have increased the efficiency and quality of business processes. Digicel uses the internet through the social networks like twitter and facebook to attract new customers and advertise their services.
However, in spite of all the advantages, technology also has its drawbacks. Digicel is now online and services can be done at local banks and connected through computers. Therefore, the company is vulnerable to hackers and computer viruses that can paralyze its business. Computer crime is also a threat and has damaging effects on any global information systems. Computer security and protection is critical to the business. The use of technology in the business also has a major impact on privacy issues. Violation of privacy, computer monitoring, and computer matching, unauthorized personal files are examples of privacy issues that can destroy the reputation or integrity of any company (O’Brien, J. 2003). Digicel must take these threats seriously as it continues to compete in both national and international markets.
An issue that faces Digicel or any company that uses technology is that technology is not static. In fact, the dominant attribute of technology is that it is always changing. Digicel must continue to invest to keep its technology up-to-date and able to help make the company compete successfully in the global markets. It has to ensure that its employees are effectively trained on the use of technology to achieve maximum productivity and quality. Digicel’s managers and employees involved in international business regularly interact with people from different countries. They are constantly exposed to different social, political, cultural, and economical challenges. The globalization of Digicel can present complex problems for its international managers and employees.
Post, Lawrence, and Weber , 1999 states that to do business in the international market, a company must “design a business plan that fits with the cultural, competitive, and political realities of diverse societies defined by features such as language, customs, religion, and traditions” (p.125). It is important for Digicel to not only appreciate the cultural differences, but also to understand how these differences can affect its international business operations. Digicel should vary its management process and practices to take these differences into account. Maintaining current or potential multinational customers is a challenge for any global business. Each time Digicel opens a store in a different country, it has to integrate the “company’s unique culture and effective retailing concepts to each new country”. However, the emergence of multinational customers’, demand that Digicel also has to take into account and be sensitive to the differences in customer preferences, needs and requirements. The company has done considerable market research and analysis before its expansion to other countries. The globalization of a company’s market poses a challenge to the individuals responsible in the management of knowledge.
Companies use knowledge management technologies to have a focused view of its customers around the world. Development of technology and expanding markets in different economic regions necessitates the use of knowledge management technologies. Organizational change is a major strength for Digicel. They are consistently redefining processes to reduce costs in the area of telecommunications, inventory replenishment lead times, purchasing and defining the appropriate product and merchandise mix at each of their locations. Operations at Digicel are built on the premise that they can offer everyday low prices. This has been a competitive area that Digicel has had success in. Digicel has been able to build consumer trust by delivering the promise of the cutting-edge technologies and services at a competitive price. By driving down costs in all portions of their business they have a successful business strategy.
What makes Digicel successful is its “ability to apply technology to its critical processes” (www.digicelgroup.com). It is important to note that new knowledge and technology comes from the innovative and creative minds of employees and leaders. The need to be better and/or faster inspires new way of thinking. A company that encourages innovative and creative thinking and integrates these into its organizational culture will attain competitive advantage. The goal of planned organizational change is to find new or improved ways of using resources and capabilities in order to increase an organization’s ability to create value and improve returns to its stakeholders. An organization in decline may need to restructure its resources to improve its fit with the environment. At the same time even a thriving organization like Digicel may need to change the way it uses its resources so that it can extend its business and find new markets for its existing products.
One of the findings from my studies revealed that the employees of Digicel resisted the change to conduct business online and through the local financial institutions. In a sense, this is positive. It provides a degree of stability and predictability to behavior. If there weren’t some resistance, Digicel may have taken on characteristics of chaotic randomness. Resistance to change can also be a source of functional conflict. For example, resistance to Digicel’s transformational change or its reorganisation stimulated a healthy debate over the merits of the idea and resulted in a better decision. But there is a definite downside to resistance to change. It hinders adaptation and progress. Resistance to change doesn’t necessarily surface in standardized ways.
The resistance to change at Digicel was overt and immediate. It made it easier for management to deal with resistance when it is was this way: For instance when the change was proposed and employees quickly responded because they thought their jobs were being made redundant by voicing complaints, engaging in a work slowdown, threatening to go on strike, or the like. The greater challenge for management would have been managing resistance that was implicit or deferred. Implicit resistance efforts are more subtle – loss of loyalty to the organization, loss of motivation to work, increased errors or mistakes, increased absentism due to sickness and hence, more difficult to recognize. Similarly, deferred actions cloud the link between the source of the resistance and the reaction to it.
A change may produce what appears to be only a minimal reaction at the time it is initiated, but then resistance surfaces weeks, months or even years later. A single change that in and of itself might have little impact becomes the straw that breaks the company’s back. Reactions to change can build up and then explode in some response that seems to tally out of proportion to the change action it follows. The resistance, of course, has merely been deferred and stockpiled what surfaces is a response to an accumulation of previous changes. When management is willing to discuss openly with their employees all aspects of an impending change, it is desirable that ample time be planned between the initial mention of the change and the state of its actual initiation. Management should use this interval to ensure that all involved attain maximum understanding of the change and its probable consequences. Management should plan the length of this interval by working out a trade-off between two considerations. Often these will be in conflict with each other.
The first of this is a question of how long it takes for the processes of accommodation and rationalization to occur for the most people involved. The second consideration is an evaluation of those situational factors which determine when the change must be instituted and implemented and when the benefits must be realized. To achieve the best trade-off between these two considerations, management needs to evaluate the relative costs of two alternatives; delaying the introduction of the change to gain more preparation time in the interest of realizing optimum benefits, conforming to the intended schedule with the possibility of an increased risk of resistance and the resultant probability of reduced benefits. In many instances, management may discover that it will be economical to delay the change until the possibility of its acceptance is enhanced. If management decides not to delay, resistance may cause not only reduction in the possible benefits but also probable delays in their realization, management should plan sufficient time during the early phase of the change for accommodation and rationalization to occur and for understanding to be developed.
Involvement and participation are perhaps the most powerful techniques management can use to gain acceptance of change. Commitment to carry out these decisions is intensified. Personal satisfaction derived from the job is increased. The extent of personal involvement can range from merely being informed, to discussing problems and voicing opinions and feelings to actually making and implementing decision. Digicel has become one of Caribbean’s most successful telephone companies by offering communication services at low prices for individual, families and corporations. It is strong because it shapes perception better than any company in the region. Digicel’s power position relative to the key policy issues and stakeholders is one of domination. The size, wealth, and financial power of the company are impressive.
It is the largest communication company in the Eastern Caribbean States. It is the largest political and social donor in the retail sector. This dominance, and the company’s finances, coupled with retaining the top lobby shops in the Region give the company an advantage. The company manages its relationship with its key stakeholders in a way that maximizes the tactical advantage of Digicel. With groups that the company perceives as hostile, such as other communication companies, complaining former employees, or even local ad hoc opposition groups, who are fighting to keep Digicel out of their community, the company uses every means available to it in order to win. Digicel has established a foundation in an effort to give back to the community where the company is based by issuing scholarships, sponsoring sports personnel and assist the less fortunate.
The company applies its retail philosophy, of being the best, and winning, into its political and public affairs strategy. Using tools at its disposal, such as the top law firms, and top Public Relations firms, the company does battle in court with those who challenge it. In public, Digicel uses top of the line Public Relations strategy firms to produce commercials for its stores and to portray the best possible image. Another way the company is successful is its ability thus far to keep out of the headlines any significant negative publicity. The company has also avoided being probed by regulators for some of its aggressive retailing and competition practices. In the case of Digicel and government relations, the goal is to have a low profile, and to keep government regulators away.
Its relationships with key stakeholders are maintained as well by the communication of corporate statements on its Internet site and through other paper based corporate communications. It keeps contact with the Government offices and retained political groups. The strategic and tactical advantage of Digicel when pursuing a political and public affairs strategy is the use of its financial resources and to provide handset for communications. It can buy an army of the top lobby firms, lawyers, and public relations specialists should it need to. Since the company has a history of fighting back, and winning, when it is challenged, that may be keeping larger groups away from fighting the retail giant. From a scan of recent headlines, the company does not appear to be involved in fighting any major federal legislation.
Notably, Digicel is involved in numerous municipal zoning disputes across the Region. In an attempt at meeting the demands of its customers within the region, Digicel embarked on purchasing various pieces of property in which to erect transmission towers. The top issue within this venture is the question of zoning regulations and the proximity of these towers in the communities and the population on the whole. The company has been making large payouts in an attempt to keep the towers which were erected and to erect more so as to establish greater services. The company’s strategic and tactical activities are more apparent at the state and municipal levels. Mainly, the company fights legislation through the courts. Top issues are municipal zoning regulations. At the federal level, it is worth noting that Digicel gives heavily to political candidates, who happen to be generally pro business in their voting.
Digicel does not generally employ a grassroots campaign strategy, as it has no established infrastructure to do this. It has over five thousand, five hundred employees. Should the company wish to tap its “associates” to become active on an issue, such as trade, for example, they would have a large base of people to draw upon. May of the She Magazine noted that Digicel sometimes stages grassroots efforts to oppose local companies who are rallying against technological advances. Digicel will send in professionals and staff from its headquarters to form business development and revitalization committees, and use these fronts to challenge the anti Digicel groups (She Magazine, 33)
In terms of consistency, the company has much to improve in the way of dealing with communities and groups. The company chooses to cut costs and push the boundaries of existing regulations. Then it falls victim to lawsuits and is sued for hundreds of thousands of dollars. The company has a goal of keeping out unions. Yet, the company by its frugal employee wage compensation practice, the reliance on part-time workers, and unfair shift scheduling practice, is creating discord among its employees.
These conditions foster the development of labor unions. If the company were to improve its payment and treatment of employees, perhaps it can avoid future problems and issues such as turnover. The company is well positioned to tackle any obstacle. While not maintaining a large government relations department, the company retains top lobbyists, making it ready and capable to deal with issues as needs warrant. In conclusion, Digicel is the number one retailer in the Caribbean Region and operates in many countries and is moving into new countries every year.
Digicel is also expanding as a telecommunication giant. Each year, the number of people who have a stake in Digicel also grows since gives shares to the employees. Digicel has had reasons to file law suits against its competitors as injunctions were placed against them as it relates to use of similar networks within the same region. Digicel is often able to uncut many other local industries and more communication companies are shutting down when Digicel moves into town.
As a result of Digicel’s ever growing size and variety of services they offer, their public affairs department is going to become more and more important. As Digicel attain sectors of the marketplace, there is going to be more regulation against them and their public affairs department is going to have to work harder to make it possible for Digicel to continue to grow. And as the animosity against Digicel becomes more widespread, here and in foreign countries, Digicel is going to have to work harder to maintain their good reputation. Digicel’s foundation will become increasingly more important for giving things back to the community. In order for Digicel to stay at the top of their game and follow the company’s strategy and achieve their key policy goals, they are going to have to deal better with their stakeholders and make sure they guard their reputation well.
Module – Managing Change in Organisations.
http://searchcio.techtarget.com/definition/organizational-change-management-OCM http://www.businessdictionary.com/definition/transformational-change.html (2008) About Digicel. Retrieved November 8, 2008
May Wayne. She Margazine” Into Their Business Model. Volume 3. Star Publishing Company. October 2010. Page 33.
Post, J.E, Lawrence, A. T., & Weber, J. (1999). Contemporary Business Issues with Readings. Based on selected materials from the ninth edition of business and society: corporate strategy, public policy, ethics, New York, McGraw-Hill Gareth R. Jones (2004). Organizational Theory, Design, and Change: Text and Cases. Fourth Edition. Pearson Education, New Delhi.
Kavita Singh (2005). Organisation Change and Development. New Delhi :Excel.
2000-2001. National Directory of Corporate Public Affairs.
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