Change management Essay
Change management is an approach to transitioning individuals, teams, and organizations to a desired future state. In this assignment I will be covering Rollin and Christine Glaser’s (1992) five elements to improve team effectiveness, IT management competencies, reasons for mergers and acquisitions in reference to South African businesses and roles leaders should play during the change process. In the aim to provide one with a better understanding of and insight of change management.
Rollin and Christine Glaser (1992) the five elements that contribute to the level of a team’s effectiveness over time.
• Team mission, planning and goal setting;
• Team roles;
• Team operating processes;
• Team interpersonal relationships; and
• Inter team relations.
Team mission planning and goal setting
The most effective teams have a strong sense of their purpose, organize their work around that purpose, and plan and set goals in line with that purpose. Teams and individuals within teams must have a clear understanding of their objectives. Clarity of objectives together with a common understanding and agreement of these objectives are fundamental. Locke and Latham have identified that the very act of goal setting was a prime motivator for a team; the more your team sets clear goals the more likely it is to succeed. When implementing clear goal setting in a team it will increase the effectiveness ratio. Clear goals are even more substantial when teams are involved in change, partially because unless they know where they are going they are unlikely to get there, and partly because a strong sense of purpose can mitigate some of the more harmful effects of change.
The team should comprehend their own and other team members roles, and how these link to achieving the team objective. This becomes even more important with teams based remotely and some that are part-time working. The best way for a team to achieve its goals is for the team to be structured logically around those goals. Individual team members need to have clear roles and accountabilities. They need to have a clear understanding not only of what their individual role is, but also what the roles and accountabilities of other team members are. Clear roles have two useful functions. It contributes to a clear sense of purpose and it provides a supportive framework for task accomplishment.
Team operating processes
A team needs to have certain enabling processes in place for people to carry out their work together. These processes can be seen as ground rules for a team to adhere to. Certain things need to be placed that will allow the task to be achieved in a way that is as efficient and as effective as possible. Processes deals with the issues and decisions and how the team will respond to them in an efficient and effective way without disrupting the work process within the team.
During the change process when team change typically puts pressures and priorities it can isolate people away from the team, the team operating processes can act like a lubricant, enabling a smooth healthy team to continually function.
Areas that a team need actively label by discussing and agreeing include: • Frequency, timing and agenda of meetings;
• Problem-solving and decision-making methodologies;
• Ground rules;
• Procedures for dealing with conflict when it occurs;
• Reward mechanisms for individuals contributing to team goals; • Type and style of review process.
Team interpersonal relationships
To encourage team members to communicate with one another, share information, communicate openly, respect differences, which will increase relationships and understandings within the team. This all helps to build trust and a better working atmosphere. To achieve clear understanding of goals and roles, the team needs to work together to agree and clarify them. Operating processes must also be discussed and agreed. To achieve this level of communication, the interpersonal relationships within the team need to be in a relatively healthy state. Allowing for open communication that is assertive and task focused, as well as creating opportunities for giving and receiving feedback aimed at creating development. High levels of trust within a team are the foundation for coping with conflict.
Regular communication flows between teams are essential as they help to keep up with changing situations and ensure the right thing is being delivered. Teams cannot work in isolation with expecting in achieving their organizational objectives. The nature of organizations today are complex, sophisticated and with increasing loose and permeable boundaries. Teams need to connect more. It is also because the environment is changing faster and is more complex, so keeping in touch with information outside of your own team is a basic survival strategy.
IT MANAGEMENT COMPETENCIES
• Business deployment:
A systematical procedure of implementing an activity, processes, programs, or systems to all concerning areas of an organization to achieve a particular outcome. Communicate the value offered by emerging IT organisations. This needs to be coupled with the use of IT teams, with good knowledge of IT, to improve IT solutions.
Examination of the potential business value of new, emerging IT Utilization of multidisciplinary teams throughout the organization Effective working relationships among line managers and IT staff Technology transfer, where appropriate, of successful IT applications Platforms and services
Adequacy of IT-related knowledge of line managers throughout the organization Visualizing the value of IT investments throughout the organization Appropriateness of IT policies
Appropriateness of IT sourcing decisions
Effectiveness of IT measurement systems
• External networks:
The network outside a team’s internal network environment which can’t be controlled by the team or the organization. These needs are to create close partnerships with external companies to create more organisational awareness.
Existence of electronic links with the organization’s customers Existence of electronic links with the organization’s suppliers Collaborative alliances with external partners (vendors, systems integrators, Competitors) to develop IT-based products and processes.
• Line technology leadership:
Line technology leadership is a process of social influence in which one person can enlist the aid and support of others in the accomplishment of a common task within the IT management environment. It is having the ability in organizing a group of people to achieve a common goal. Users such as line managers and senior managers need to participate actively in leading IT initiatives.
Line managers’ ownership of IT projects within their domains of business responsibility Ability of employees throughout the organization to serve as Project Leaders.
• Process adaptiveness:
The ability to change and adapt suitably and accordingly to suit the IT climate and are able to conform to the new conditions by means of modification. It is also about the companies track record in restructuring its processes, and the existence of an environment where employees can find and explore the functionality of IT systems.
Ability of employees throughout the organization to learn about and subsequently explore the functionality of installed IT tools and Applications restructuring of business processes, where appropriate, throughout the organization Visualizing organizational activities throughout the organization.
• IT planning
IT planning is the process of thinking about and organizing the activities required to achieve a desired goal within an information technology environment. It involves the creation and maintenance of a Strategic plan. The thought process is essential to the creation and refinement of an IT plan in relation to strategic planning, or integration of it with other plans. It combines with developments with the preparation of scenarios of how to react to them.
Integration of business strategic planning and IT strategic planning Clarity of vision regarding how IT contributes to business value Effectiveness of IT planning throughout the organization
Effectiveness of project management practices.
• IT infrastructure
IT infrastructure is a combined set of hardware, software, networks, facilities, etc. In order to develop, test, deliver, monitor, control or support IT services. It controls the restructuring, design and architecture of data and networks etc. It is also about the appropriateness and flexibility of the underlying infrastructure which allows innovative IT practices to be emerged.
restructuring of IT work processes, where appropriate
Appropriateness of data architecture
Appropriateness of network architecture
Knowledge of and adequacy of the organization’s IT skill base Consistency of object (data, process, rules) definitions
Effectiveness of software development practices.
A lot of commercial mergers and acquisitions are about growing and expansion. Growth normally involves acquiring new customers. Merging or acquiring another company enables a faster way of growth, which detours around the unnecessary, long, tedious and uncertainty process of internally generated growth. It brings with it the risks and challenges of understanding the intended benefits of this activity. The appeal of immediate revenue growth must be weighed up against the negatives of asking management to run an even larger company.
Massmart a South African firm has merged with American giants Wal-Mart in hopes to create more and new customers. It can also be about getting access to facilities, brands, trademarks, technology or even employees. This strategy was used to implement growth and expansion in this particular industry.
It’s the cooperation of two or more organizations to produce a combined effect greater than when they were separate . If two organizations are thought to have synergy, this indicates the potential ability of the two to be more successful when merged than they were apart. This usually translates into: Operating synergies are those synergies that allow firms to increase their operating income from existing assets ,increase growth or both. • Growth in revenues through a newly created or strengthened product or service (hard to achieve) • Cost reductions in core operating processes through economies of scale (easier to achieve) • Financial synergies such as lowering the cost of capital (cost of borrowing, flotation costs) • More competent, clearer governance (as in the merger of two hospitals). However, there may be other gains. Some acquisitions can be motivated by the belief that the acquiring company has better management skills, and can therefore manage the acquired company’s assets and employees more successfully in the long term and more profitably. Mergers and acquisitions can also be about strengthening quite specific areas, such as boosting research capability, or strengthening the distribution network.
Diversification is about growing business outside the company’s traditional industry. This type of merger or acquisition was very popular during the third wave in the 1960s (see box). Although General Electric (GE) has flourished by following a strategy that embraced both diversification and divestiture, many companies following this course have been far less successful. Diversification may result from a company’s need to develop a portfolio through nervousness about the earning potential of its current markets, or through a desire to enter a more profitable line of business. The latter is a tough target, and economic theory suggests that a diversification strategy to gain entry into more profitable areas of business will not be successful in the long run (see Gaughan, 2002 for more explanation of this). A classic recent example of this going wrong is Marconi, which tried to diversify by buying US telecoms businesses. Unfortunately, this was just before the whole telecoms market crashed, and Marconi suffered badly from this strategy.
Integration to achieve economic gains or better services
Another increasingly common motive for merger and acquisition activity is to
achieve horizontal integration. A company may decide to merge with or acquire a competitor to gain market share and increase its marketing strength. Public sector organizations may merge purely to achieve cost savings (often a guiltily held motivation) or to enhance partnership working in the service of customers. Vertical integration is also an attraction. A company may decide to merge with or acquire a customer or a supplier to achieve at least one of the following: • A dependable source of supply;
• The ability to demand specialized supply;
• Lower costs of supply;
• Improved competitive position.
An example of this in South Africa is when Glaxo-Smith Kline (GSK) one of the largest pharmaceutical company worldwide decided to merge with Aspen Pharmaceuticals (Largest Pharmaceutical Company in South Africa) in order to get a better hold of its market position in Africa and by obtaining tenders and contracts by the government to supply local communities within South Africa generic medication and also anti-retrovirals.
Some mergers are defensive and are a response to other mergers that threaten the commercial position of a company.
Pressure to do a deal, any deal There is often tremendous pressure on the CEO to reinvest cash and grow reported earnings (Selden and Colvin, 2003). He or she may be being advised to make the deal quickly before a competitor does, so much so that the CEO’s definition of success becomes completion of the deal rather than the longer-term programme of achieving intended benefits. This is dangerous because those merging or acquiring when in this frame of mind can easily overestimate potential revenue increases or costs savings. In short, they can get carried away. Feldmann and Spratt (1999) warn of the seductive nature of merger and acquisition activity. ‘Executives everywhere, but most particularly those in the world’s largest corporations and institutions, have a knack for falling prey to their own hype and promotion. Implementation is simply a detail and shareholder value is just around the corner. This is quite simply delusional thinking.’
There are various views about the role a leader should play in the change process
• The machine metaphor implies that the leader sits at the top of the organization, setting goals and driving them through to completion. • The political system metaphor implies that the leader needs to become the figurehead of a powerful coalition which attracts followers by communicating a compelling and attractive vision, and through negotiation and bargaining. • The organism metaphor says the leader’s primary role is that of coach, counsellor and consultant. • The flux and transformation metaphor says the leader is a facilitator of emergent change.
Different types of leaders have different types of role.
Local line leaders
These are the front-line managers who design the products and services and make the core processes work. Without the commitment of these people, no significant change will happen. These people are usually very focused on their own teams and customers. They rely on network leaders to link them with other parts of the organization, and on executive leaders to create the right infrastructure for good ideas to emerge and take root.
These are management board members. Senge does not believe that all change starts here. Rather, he states that these leaders are responsible for three key things: designing the right innovation environment and the right infrastructure for assessment and reward, teaching and mentoring local line leaders, and serving as role models to demonstrate their commitment to values and purpose.
Senge makes the point that the really significant organizational challenges occur at the interfaces between project groups, functions and teams. Network leaders are people who work at these interfaces. They are guides, advisors, active helpers and accessors (helping groups of people to get resource from elsewhere), working in partnership with line leaders. They often have the insight to help local line leaders to move forward and make changes happen across the organization. The interconnections are hard to achieve in reality. We have observed the following obstacles to achieving smooth interconnection between the different roles: • Executive leaders are busy, hard-to-get-hold-of people who can become quite disconnected from their local line leaders. • Executive leaders and local line leaders rarely meet face to face and communicate by e-mail, if at all. •
Network leaders, such as internal consultants or process facilitators, are often diverted from their leadership roles by requests either to perform expert tasks or to implement HR-led initiatives. • Network leaders may be busy and effective, but are usually undervalued as leaders of change. They often have to battle to get recognized as important players in the organization. Senge’s model recognizes the need for all three types of leader, and the need for connectivity between different parts of the organization if change is desired.
It’s more appropriate in anticipating objections than to spend your time putting out fires,(prevention is better than cure) and understanding how to overcome resistance to change is a essential part of any change management plan. Expecting resistance to change and planning for it from the start of your change management course of action will allow you to effectively and effectively manage objections. Not dealing with change proactively is one of the larger downfalls.
In the end all sources of resistance to change need to be acknowledged and employee’s emotions validated in order to move forward with the change.
Glossary of terms
Question 1- Rollin and Christine Glaser (1992) five elements to improve team effectiveness
Question 2- Discussing five categories of IT management competences
Question 3- Reasons for mergers and acquisitions in reference to South Africa
Question 4- Roles leaders play in the change process
Bibliography and References
Glossary of terms
Restructuring: This type of corporate action is usually made when there are significant problems in a company, which are causing some form of financial harm and putting the overall business in jeopardy. The hope is that through restructuring, a company can eliminate financial harm and improve the business
Acquisition: An act of purchase of one company by another.
Merger: The combining of two or more companies, generally by offering the stockholders of one company securities in the acquiring company.
Change: The act or instance of making or becoming different.
Resistance: The refusal to accept or comply with something, the attempt to prevent something by action or argument.
Cognitive: The mental process of knowing, including aspects such as awareness, perception, reasoning, and judgment.
References and bibliographies
Cameron ,E, Green ,M. “Making Sense of Change Management: A Complete Guide to the Models Tools and Techniques of Organizational Change”. Kogan Page Publishers, (2012)
Kotter, J. (July 12, 2011). “Change Management vs. Change Leadership -What’s the Difference?”
Filicetti, John (August 20, 2007). “Project Management Dictionary”.
Conner, Daryl (August 15, 2012). “The Real Story of the Burning Platform”.
Anderson, D. & Anderson, L.A. (2001). Beyond Change Management: Advanced Strategies for Today’s Transformational Leaders.