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This assignment examines the organizational changes that the Virgin Group has undergone in recent years and how they are adjusting to the changing operating environment. The focus is on employees' perception of the changes and how the Virgin Group can reduce their resistance to change. It is natural for employees to feel uncertain when faced with change, and this needs to be effectively managed. The Virgin Group's airline operation, Virgin Atlantic, is specifically emphasized. Founded in 1984, Virgin Atlantic Airways is the second largest carrier in the UK.
The company operates at Gatwick, Heathrow, and Manchester airports and offers long haul services to over thirty destinations worldwide. The organization has received recognition and awards from prominent business, consumer, and trade sources (www.virgin.com).
The theoretical framework is 2.0.
2.1 The definition of Change management.
Change management is a multidisciplinary field that incorporates various social science disciplines and traditions. The theory and practice of change management are influenced by three main schools of thought: the Individual perspective school, which is divided into Behaviourist and Gestalt-Field theory.
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The Gestalt-Field theorists argue that behaviour is not solely determined by external factors, but also by how individuals interpret those factors. On the other hand, the behaviourists focus on modifying external stimuli to bring about organizational change.
The Group Dynamics school, originated by Kurt Lewin, emphasizes that people in organizations work in groups and individual behavior should be seen and modified in the context of group practices and norms. As a result, change efforts should focus on influencing and changing group norms, roles, and values.
On the other hand, the Open Systems school takes a holistic perspective in understanding organizations as a whole. It approaches organizational change as a systematic process that encompasses adapting to change, controlling change, and effecting change. Proactively addressing change is central to all three aspects of change management.
Change management for an organization involves establishing and executing procedures and/or technologies to address changes in the business environment and capitalize on evolving opportunities. According to Daft (2000), change is an unavoidable aspect, and all organizations experience it at some point, if not constantly. Organizations typically undergo changes due to political, economic, social, technological, and legal factors. There are four distinct types of changes that organizations can undertake: technological change, change related to new products, structural change, and cultural change.
According to Bass (1985), successful adaptation to change is essential for both organizations and individuals, just as it is in the natural world. Similar to plants and animals, organizations and their members will inevitably face uncontrollable changes. Thriving is more likely when change is effectively managed. Adaptation could involve implementing a structured approach to address changes in the business environment (such as economic fluctuations or competitive threats) or establishing coping strategies for changes in the workplace (such as new policies or technologies).
2.2 RESISTANCE TO CHANGE
Multiple authors emphasize that resistance to change is a major factor in the failure of many change initiatives. These authors include Lawrence (1954), Maurer (1996), Strebel (1994), and Waddell and Sohal (1998), among others. Resistance to change brings about costs and delays that are difficult to predict, as noted by Ansoff (1990) and Lorenzo (2000). However, such costs and delays must be taken into account during the change process. Additionally, resistance to change can provide valuable information for improving the success of the change process. This perspective is shared by Beer and Eisenstat (1996), Goldstein (1988), Lawrence (1954), Piderit (2000), and Waddell and Sohal (1998). Consequently, resistance to change plays a crucial role in change management, and its significance should be duly acknowledged in order for organizations to reap the benefits of transformation.
In order to effectively handle resistance to change, organizations can employ the following methods: Communication and Education. Communication is essential for providing accurate information to ensure employee support, while education is necessary when introducing new technology, products, or services (Bunker and Alban, 1992).
Active involvement of employees in the change initiation phase is crucial for a smooth transition to the post-change phase. Encouraging employee participation during this phase can significantly reduce potential issues and problems that may arise during the implementation of the change. By identifying and solving problems in the initiation process, organizations can avoid complications later on (Buller, 1988). In cases where there is strong resistance, negotiation techniques can be employed to effectively convey the benefits of the change to employees. Additionally, the visible support of top management plays a critical role in reducing and eliminating resistance to change (Daft, 1982).
3.0 HOW VIRGIN GROUP IMPLEMENTS CHANGE
Sir Richard Branson, disillusioned by the public listings, obligations, and corporate bureaucracy of a publicly listed organization, decided to take the Virgin Group back to private ownership (Johnson, G & Scholes J 2004). The philosophy behind this move is to prioritize long-term expansion over short-term profits (www.virgin.com). The Virgin Group's approach is based on the business requirements and the structure needed to operate within the changing environment. This approach significantly impacts the overall organizational performance (Burnes, B. 2000).
The Virgin Group's structure and achievements are influenced by the environment. Therefore, internal changes in the structure are a response to external markets (Mullins, L 2005). Changing the organization's listing resulted in a significant reduction in bureaucratic elements and hierarchical structure within the Virgin Group (Johnson, G & Scholes J 2004). Consequently, Sir Richard Branson adopted a "hands-off" approach with managers, encouraging them to utilize their skills, initiative, and experiences (www.virgin.com). This restructuring has caused employees to be divided into specific groups or areas of the business due to the diverse locations and range of services and goods provided by the Virgin Group.
Therefore, the Virgin Group is not a centralized team, and some divisions may operate in an "insular" manner without changing the structure (Burnes, B. 2000). One issue the Virgin Group faced was the presence of several layers of managers, which can hinder the management reporting systems and their response to situations. In the current environment, this slows down internal management processes and hampers change (Burnes, B. 2000). Communication issues have arisen within the group since the structural change, especially at the middle and lower employee levels.
According to Johnson and Scholes (2004), the lack of information on proposed changes prevented them from instructing employees on organizational changes. The Virgin Group has a decentralized structure, which can lead to silo behavior among different teams and locations. This structure often fosters competition between groups. In order to promote a sense of unity within the Virgin organization and decrease silo behavior resulting from the structural change, they implemented a single web address, Virgin.com. This allows customers to access all Virgin services through one portal.
These strategies assist in supporting the organizational parenting strategy and improve the synergies already imitative from the organizational branding of the Virgin Group (www.virgin.com). The service provided by Virgin Atlantic is highly customer-focused, with a focus on value for money, quality, fun, and innovation. The organization is 51% owned by the Virgin Group and 49% owned by Singapore Airlines, employing over 9000 people (www.virgin.com). This change has resulted in two internal parent organizations, with Virgin retaining the majority share. Changes to organizations are becoming widespread, reducing the organization's control of the external environment. All organizations face constant change in both their operational environment and organizational context.
There is currently a strong emphasis on the importance of human resource in modern organizations. This change can be driven by internal or external factors within the organization (Coram, R & Burnes B 2001). The human resource is a crucial part of the organizational context and is not exempt from the impact of these changes (Frank F et al 2004). Modern theorists argue that for organizations to be successful in their current and future operating environments, they must prioritize the composition and motivation of their human resource (Beardwell, I. et al. 2004). Virgin Atlantic recognizes the value of its employees and provides training to ensure high service levels and continued effectiveness (www.virgin.com).
Managing human resources fairly is crucial in response to organizational change. Using human resource management as a tool can help organizations motivate and encourage employees to adapt to the proposed changes. It is challenging to determine the specific requirements from the human resource during organizational change, as future prospects for all organizations are unpredictable (Bratton, J & Gold J 2003). HR responses to market forces serve as an internal driver of change. To effectively adapt to change, the HR function needs to consider both the current issues within their human resource and the broader financial and business requirements (Bratton, J & Gold J 2003). The Virgin Group, including Virgin Atlantic, places emphasis on managing their employees. They recruit individuals who align with their culture and support the Virgin ethos. An organization's strategy serves as a driving force for internal change (Bellin, B & Pham C 2007).
The strategy is a consciously created plan, which will include the methods and actions, to achieve the desired result. An organisation mission statement is usually a non-monetary realization. This mission is the future direction of the organization (Johnson, G & Scholes J 2004). The internal forces for change include making the organizational structure more effective, reducing diversification through streamlining the portfolio, and identifying new and emerging markets. This change has realigned the organization on their mission, focusing employees to assist in the transformation (Groucutt, J. et al 2004). Virgin Atlantic relies on their branding and this is evident when they enter new markets. It has been an internal driver of change for them (Groucutt, J. et al 2004). The Virgin brand name is the most significant benefit and asset to the organization.
Virgin and Sir Richard Branson have capitalized on their brand, as seen in the advertisements for Apple Computers where Sir Richard Branson was portrayed as a "shaper of the 20th century" alongside Einstein and Ghandi (www.virgin.com). The management of Virgin Atlantic has shown great strength in leading the organization through recent changes. This strong leadership is crucial for employees during periods of change, as an organization's efficiency and survival depend on the management and leadership team's abilities (Bailey, J. 2009). Gupta (2004) concludes that leadership is what turns the ideal world of vision into a reality (Gupta, S 2004).
Virgin Atlantic benefits from the strong leadership of Richard Branson and the support of the Virgin Group as its parent company (Bailey, J 2009). This ensures stability during times of change and reduces resistance among employees. Effective communication and management of behaviors that drive employee performance are also crucial for the success of the organization (Gupta, S 2004). Virgin Atlantic promotes a culture that allows managers to make decisions freely, take responsibility for their actions, and take ownership of the organization. This fosters growth and encourages an innovative and competitive mindset among managers. When recruiting new management, potential candidates are evaluated for their abilities, innovation, and competitiveness (www.virgin.com).
In addition, Virgin Atlantic has the ability to handle the potential drawbacks of autonomy and decentralization. To prevent communication failures and the risk of business units pursuing their own strategies, the Virgin Charter outlines a management system and online business strategy that leverages information technology and expands the Virgin brand. External factors have driven individual businesses within the Virgin Group to adopt the "five pillar" approach, which focuses on travel, leisure, mobile phones, entertainment retailing, and personal finance. This strategic framework keeps employees aligned with organization goals and fosters unity. The success of the Virgin Group relies on its corporate parenting strategy and the competitive advantage derived from its culture. (Source: www.virgin.com)
The Virgin Group’s strategy involves decentralizing businesses and maintaining a unified branding. In the short term, this strategy is highly regarded and some experts believe it is nearly unstoppable (Johnson & Scholes, 2004). However, in the long term, a succession plan is necessary to replace the natural turnover of management with individuals who align with the Virgin Charter. These individuals must carry on the Virgin Group's corporate ethos by effectively implementing the Virgin Charter (Groucutt et al, 2004). Virgin Atlantic also needs to carefully evaluate new markets before entering them. A single mistake could tarnish or even destroy the Virgin Brand, which would have disastrous consequences for the entire group (Johnson & Scholes, 2004). It is important for Virgin to avoid over-diversification as it may undermine the strength of the brand, particularly when a product or service fails to meet the expected Virgin standard.
According to Kotler, P et al (2005), negative news about a loss of reputation spreads faster than the success of a product or service, which means that a single Virgin brand can negatively impact the entire group. As mentioned earlier, organizational change is an unavoidable part of organizational life. The operational and market environment is constantly changing due to global economy and technological advances. Therefore, organizations need to take proactive measures to mitigate the impact of forced change by predicting and assessing potential scenarios (Groucutt, J. et al 2004). Multiple external factors will influence how Virgin Atlantic manages its operations.
The external political environment, including the administrative and legal systems that govern the organization, has an impact on the Virgin Group. These external factors influence internal procedures and overall organizational effectiveness. Political influences can drive change within the organization, and an unfavorable political environment can hinder expansion into certain locations (Klein, L 2008). National financial trends also play a role in driving change, as a downturn in the economy can affect expansion plans. This can result in a decrease in economic stability and less investment attraction for the organization. The state-run legal systems consist of policies, laws, and regulations within the host country.
Within the legal framework, organisations must survive and ensure compliance to local regulations through system audits. Economic stability is crucial for organizational survival, which can be achieved by re-evaluating market position and strategically planning future goals. This alignment with the environment, known as "strategic fit," involves matching core competencies and skills with required strategies. Despite being a simple process, some organizations overlook it. Consequently, continuous organizational change can impact employees and unsettle the workplace. Individuals may become uncertain about their roles and how they fit into the organization's strategy (Baldry, C et al, 2007; Kotler, P et al 2005).
According to Hunter (2006), employees can become fearful of their job security during times of economic downturn, which can be unsettling for them. The hierarchical structure of an organization can contribute to employees' uncertainty during periods of change. Hesketh and Fleetwood (2006) argue that the organization's structure often overlooks the basic change process, which hinders the implementation of the strategy. As a result, employees are unaware of the full extent of the organizational change strategy and their role in it. The organization's structure can conceal what is really happening, with only the top management team being aware of the full strategic intent (Groucutt et al., 2004).
The constant change in Virgin Atlantic can cause uncertainty for certain employees, which can in turn lead to resistance towards the change. This resistance is not meant to be disruptive or malicious, but rather stems from a desire to hold on to familiar working patterns and behaviors. When the employee relationship is not as strong as it should be, any changes to the work environment will likely be met with resistance (Beardwell, I. 2002). Effective communication is the most important tool that management has during times of organizational change. By establishing both formal and informal communication channels, employees can receive information about the changes, allowing them to understand the reasons behind them and the benefits they bring to the organization.
The employee voice is a fundamental human right, often referred to as "free speech," and should be fostered in the workplace (Hunter, D 2006). It is important for Virgin Atlantic to provide employee forums as a platform to discuss organizational changes that will impact their work lives. These forums allow employees to openly express their concerns. Prosser (2001) emphasized that the collective voice of employees is more powerful than individual opinions, as it promotes a more humane and civilized workplace (Prosser, M 2001). Therefore, it is crucial to encourage and support employees' collective expression. The Virgin Group can also use employee surveys to gauge their sentiments, fears, and attitudes towards proposed changes.
This is considered good practice for human resource management. Surveying employee attitudes regularly helps organizations gauge their progress in employee relations (Marchington, M et al, 2001). It is beneficial for organizations to combine this method with other forms of employee listening, such as discussions and communication, to enhance their understanding (Hesketh, A & Fleetwood, S 2006). When discussing concerns, it is important to pay attention to motivational factors that maintain employee engagement with the employer (Parker, S (2000) cited in Dorenbosch, L et al 2005). However, not all theorists agree that employee attitude surveys are the best approach in industrial relations.
When employers receive the results of surveys, they are not always required to take action based on the findings. In some cases, they may simply pay lip service to the conclusions (Blyton, P & Turnbull, P 2004). Many employees believe that having union representation in their organizations is the ideal way to have their voices heard. It is widely accepted that there is much more to employee voice than what can be revealed through surveys alone (Dundon, T 2003). Virgin Atlantic has effectively implemented organizational change by restructuring the company's structure.
The organization's diverse markets and environment changes have created an insular culture. To overcome this, communication across the group is necessary. One significant challenge faced by the organization is employees' resistance to change due to uncertainty about their current and future working conditions. As individuals, employees value security, so any uncertainty naturally leads to resistance towards change.
The conclusion of this text is 4.0.
The objective of the assignment is to implement change in an organisation by understanding the theoretical aspects of change management and effectively implementing it. It is crucial to have the support of senior management, develop effective strategies, address staff resistance, and implement plans for each goal to gain a competitive advantage. Virgin Group, known for their success and innovation, must now ensure that all employees are committed to the organisational strategy and embrace the change.
The text below is a passage containing HTML tags and their contents. It cannot be paraphrased or unified as it does not form a cohesive statement or paragraph.
Managing Resistance to Change in Virgin Atlantic. (2017, Feb 16). Retrieved from https://studymoose.com/recent-organisational-changes-in-the-virgin-group-essay
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