|Understanding the background to organizational strategic change
|Three models of strategic change.
|Evaluation of the relevance of models of strategic change to organizations in the current economy
|Assessment the value of using strategic intervention techniques in organizations
|Understanding the issues related to strategic change in an organization
|Examination of the need for strategic change in an organization
|Assessment of the factors that are driving the need for strategic change in an organization
|Assessment of the resource implications of the organization not responding to strategic change
|Stakeholders engagement in developing a strategy for change
|Development of a system that involves stakeholders in the planning of change
|Development of a change management strategy with stakeholders
|Evaluation of the systems used to involve stakeholders in the planning of change
|Creation of a strategy for managing resistance to change
|Planning the implementation of the modules for ensuring ongoing change
|Development of an appropriate model for change
|Plan for implementing a model for change
|Developing appropriate measures to monitor progress.
Understanding the background to organizational strategic change
1.1 Three models of strategic change.
Some of the well-established models discussed in this task include the John P. Kotter leading change model, Kurt Lewin change management model and the McKinsey 7-S model. The Korter 8 stage approach model makes change to become a campaign whereby leaders push employees to adopt change by convincing them about the urgent need for change to happen. The model involves 8 steps that include.
- Establishing a sense of urgency
- Formation of a strong team that is dedicated to change
- Creating a clear and compelling vision
- Communicating the vision
- Empowering employees to act on the vision
- Creating short term goals
- Consolidating and building
- Making the change permanent
Step 1 to 4 role is to prepare the organization to accept changes; step 5 to 7 involves change implementation while the last step makes the change to stick. The model significant benefits to other model are that it takes an easy step-by-step process focuses on preparing and accepting change and it makes easy for transition to occur. Despite these benefits, the model is disadvantageous in that steps cannot be skipped and the process takes a long time (CAVALCANTE 2014).
The Lewin model recognizes three stages of change. That include
- Unfreeze – this step creates the right environment for change that helps in overcoming people’s tendency to put active efforts to resist change.
- Transition – the step supports change to the desired state through adequate leadership and reassurances.
- Refreeze – the step reinforces the changes as stability is regained in the organization and employees operate under the change.
The model is easy to use for most companies. Thus, it is preferred for enacting major changes within organizations. However, it also takes considerable time to implement (Müller 2014).
The McKinsey 7-S model that provides a holistic approach to firms has 7 factors that operate collectively as agents of change. The factors include shared values, strategy, structure, systems, style, staff and skills. The model’s benefits in comparison to others is that it is an effective approach in diagnosing and understanding firms, offers guidance on how to change organizations, brings together the rational and emotional components and ensures that all parts are integrated and are addressed in a unified manner. The disadvantages associated to the model are that; the model is complex, all factors are interrelated, thus, the change in one-part changes all other parts and the differences are ignored (Fuchs & Prouska 2014).
1.2 Evaluation of the relevance of models of strategic change to organizations in the current economy
Various factors should be considered by organizations in determining the relevance of a model for strategic change. Firstly, it is important that change leaders identify the various types of activity that need to be undertaken such as the management of content, control or process when determining the appropriateness of change models. Secondly, changes that are less complex may be mainly handled by conducting an effective analysis, planning and implementation. On the other hand, changes that are more complex and more stakeholders have an interest in the change require the application of approaches that are more participative (Al-Haddad & Kotnour 2015). The approach should also ensure higher engagement in management of views and expectation of various stakeholders. In the current economy, companies that aim at expanding internationally should be prepared to enhance their performance in the area of corporate responsibility and particularly environmental sustainability. The relevance of the mentioned change models is assessed by providing examples of different kinds of change that can be used to ensure corporate responsibility is improved by Amazon.com.
|Example of the type of Change
|Relevance of the Change model
|This kind of change requires major restructuring and the Kotter’s and MacKinseys model would be more applicable
|This change may involve the change of the processes in certain areas of the company and implementation of new ones that enhances sustainability. The Lewin model will be more applicable in changing the processes
|This may involve changing organizational policies and development of policies that are focused on more sustainable practices in all areas of the organization. The Mackinsey’s model would be more relevant as it is applicable in situation where revolutionary changes are needed.
|This kind of change will help in making continuous improvements in Amazon’s sustainability and corporate responsibility efforts. The Kotter’s model will be relevant because it will be helpful in making step-by-step changes.
1.3 Assessment of the value of using strategic intervention techniques in organizations
Strategic interventions are the efforts that have planned, deliberate and focused on improving an organization. Different strategic interventions techniques used in organizations provide valuable benefits to the improvement of organizations.Techno structural interventions concentrate on enhancing the effectiveness of the organization and human development through organizational structure and technology. Team development and group processes interventions improve various aspects of a group performance such as setting of goals, building of interpersonal relationships among members of a team, clarification of roles and analysis, problem solving and decision making. The individual or interpersonal process interventions help in enhancing the overall organizational performance by developing certain skills of employees. The interventions involved here include learning strategies, interpersonal communication, life transitions and mentoring. Management and leadership development interventions aim at increasing the effectiveness of both formal and informal leaders. Programs are put in place to identify measure and improve leadership qualities through interventions such as executive and professional development, coaching, mentoring, skills and technical training among others (Paquette 2016).
Understanding the issues related to strategic change in an organization
.2.1 Examination of the need for strategic change in an organization
Amazon.com, Inc has been chosen as the organization that needs change in the area of the organization’s corporate accountability reporting. There is need for change in this area because the company has received a lot of criticism for its failure to provide sustainability reports. Investors, suppliers and consumers of Amazon products are concerned with Amazon lack of disclosure on the company’s environmental, social and governance performance and goals. For a long time, the company has put no efforts in measuring, disclosing or improving its performance in the areas of the environment, diversity, workplace issues, charitable activity or political activities. Over the years, Amazon has declined to provide reports on its greenhouse gas emissions or its strategy to climate change and other environmental sustainability efforts. In addition, the company has been criticized for mistreating its workers with poor working conditions. An investigation in 2011 at a Pennsylvania Warehouse revealed that Amazon workers were forced to suffer extreme heat in the warehouses and they were pushed to work at unsustainable pace. Amazon has also been described as a minor player in terms of engaging in charitable activities and takes a low profile in the civic life in the local politics (Gunther 2012).
2.2 Assessment of the factors that are driving the need for strategic change in an organization
The driving forces of the need for strategic change in Amazon can be explained by the factors in the business external environment that include political, economical, social and technological factors.
The political factors
Amazon is likely to face a lot of backlash from government bodies that are tasked with ensuring environmental sustainability. State governments in the U.S have also declined to exempt the company from collecting sales taxes on purchases.
After, the poor working conditions at a warehouse in Pennsylvania were revealed dozen of customers vowed that they would no longer take their business to Amazon. This would affect the profits of the company leading to a poor economic performance. Additionally, individuals want to transact business with organizations that are focused on doing the right thing in the matters of environment, working conditions and transparency. Thus, the market share enjoyed by Amazon is affected and it is important for the company to introduce changes that will prevent an economic crisis (Siegei 2016).
The issue of being environmental sustainability is a social matter as it helps in preventing the occurrence of various social problems such as poor healthy. Improvement of employees working conditions could also protect their healthy and ensure their jobs provides significant gains to them. Therefore, Amazon needs institute strategic changes that will demonstrate it is responsibility towards the society.
Due to technology advancements, Amazon has become one of the largest online retailers globally and this makes the company reduce its impact on the environment because it provides a greener option of shopping as compared to other traditional brick and mortar stores. Similarly, the company should utilize technology to ensure that it improves the working conditions of its employees and develops systems that will help in measuring and reporting its efforts in sustainability (Matthews 2014).
2.3 Assessment of the resource implications of the organization not responding to strategic change
Changes in organisations bring with them several resource implications to the organization. The implications will be felt in different areas of the organization including in the purchase of new physical assets such as machines, equipments, building that will attract more costs to the organization. In the human management aspect, there will be resource implications in hiring and interviewing new employees or consultants and training of staff. Organization restructuring will also have resource implications since there are costs involved in modification of structures (Bielinska-Kwapisz 2014).
Amazon failure to issue sustainability reports as well as its green house gases goals has prompted the shareholders to request the company issue the report outlining the performance and goals in environmental, social and governance a number of times. Therefore, current investors are likely to withdraw their investments and potential investors will not be prepared to invest in the company. Failure to provide these reports will affect the reputation of the company to the public and consumers, thus, affecting the market share of the company and its financial performance (Siegei 2016).
Stakeholders’ engagement in developing a strategy for change
- Developing systems to involve stakeholders in the planning of change
A system of involving stakeholders in the planning of change should carry out stakeholder’s analysis or mapping, communicate, engage and collect feedback from stakeholders. A stakeholder analysis assists in identifying the people or groups that are likely to be affected or affect the changes that are to be introduced. It also involves sorting the stakeholders according to the impact that each has and the impact the change will have on them (Hidenori 2015). Amazon.com stakeholders include the individuals within the organization such as the employees, managers and the C.E.O and the external parties such as shareholders, customers, suppliers and NGO’s. The diagram below illustrates the kind of system that is applicable for engaging Amazon stakeholders.
This model highlights the relationship between Amazon and its stakeholders. In the figure, the issue that is requiring change is represented by the new or an existing service that both Amazon and stakeholders have a mutual interest. The model also includes the research methods that can assist in acquiring more insight into the issue. Some applicable research methods that can be applied in the model are observations, benchmarking and interviews. The service design tools and process will help in tackling the various aspects of the needed change. The present state of the organization as well as its stakeholders is analyzed to determine the degree of power and level of interest of each of the stakeholders. The stakeholder engagement framework will assist in tackling various areas of stakeholder engagement such as communicating and getting feedback from them. The results of the process model indicate the achievements of the stakeholders’ engagement process (Mangundjaya, Utoyo & Wulandari 2015).
3.2 Developing a change management strategy with stakeholders
Amazon’s strategy in tackling the needed change of reporting on its corporate accountability could be to strictly engage its current and other newly hired employees in developing plans that will help in reporting the company’s environmental, social and governance performance and goals. They also need to keep customers who have a high level of power and low level of interest on the company satisfied by reporting on its corporate accountability.
- Evaluating the systems used to involve stakeholders in the planning of change.
The system of involving stakeholders that has been suggested for Amazon shows an efficient way of creating a good plan of change and helps in effective implementation. Through this system, all stakeholders are analyzed and involved in the change process and the current state of the organization is evaluated. The engagement process identifies the issues of engagement, the tools and the approach that Amazon will use to engage the stakeholders. The system will also bring results that will be obtained through stakeholders’ strategic thinking.
3.4 Creating a strategy for managing resistance to change
Resistance to change can be in the form of either organizational barriers or individual barriers. The organizational barriers may include the current power structures, structural inertia, work groups resistance, failure of previous initiatives of change. The individual barriers to change may be insecurity, loyalty to current relationships, failure to accept that change is needed, ambitions held by different people, preference for the current arrangements, redundancy and lack of capability to perform well in the new circumstances as well as fear of losing power, income, skills or the unknown (Fuchs & Prouska 2014).
Change management strategy with stakeholders is mainly determined by the degree of power that each stakeholder has and the degree of interest on the change. The figure below suggests the way in which a company should tackle its shareholders
According to the above figure, Amazon stakeholders with more power and more level of interest like the shareholders and employees require to be managed closely in relation to the change intiatives. On the other hand, customers as the stakeholders with high level of power and low degree of interest should be kept satisfied by the management of the company. suppliers who have a high level of interest and low power should be kept informed through different communication channels about how the change initiatives are progressing. Another stakeholder like the general public who have low degree of power and low interest in changes in Amazon should be monitored with few resources and reduced efforts. Therefore, Amazon can utilise the power/interest grid to manage the resistsnce of change by ensuring all categories of the stakeholders are consistently part of the change intiatives (Hidenori 2015).
Plans for implementing modules that ensures ongoing change
4.1 Developing appropriate models for change
Refer to the models of change discussed on part 1.1, page 3 & 4
4.2 Plans for implementing a model for change
Amazon.com should take action in order to handle the present issue that is likely to affect the reputation of the company and its market share. The Kotter’s change model can be selected to implement change in the company.
Stage 1 Creating urgency
Amazon needs to develop a sense of urgency around the necessity for change by sparking the initial motivation that will commence the initiatives for change. Hence, Amazon is required to;
- Find out the potential threats and come up with scenarios indicating what will take place in the future
- Analyze the opportunities that Amazon can exploit
- Commence honest discussions with the employees providing dynamic and convincing reasons that will trigger their thinking and talking.
- Request the support of the outside stakeholders such as customers and other industry players, which will strengthen its argument.
Stage 2 forming a powerful coalition
To convince people about the need for change, Amazon has to have strong leadership and key people within the company have to provide visible support. Thus, Amazon need to:
- Identify the true leaders in the organization
- Ask the key people to show their emotional commitment
- Put efforts in building teams within the change coalition
- Identify weak areas in the teams and ensure the team in inclusive of all people for various departments and levels of the company
Stage 3 creating a vision for change
The vision will assist in making sure that all people understand the reason behind Amazon’s change initiative. After being aware of what the company is trying to attain, then the directions given will make more sense. The values that are critical to change should be determined by:
- Creating a summarized message that captures the future goals of the company
- Developing a strategy that will help in executing the vision
- Making sure that the change coalition will describe the vision in the shortest time possible
- Ensuring the vision speech is practices often
Stage 4 communicating the vision
To demonstrate the kind of behavior that Amazon expects from others, the company should:
- Mention its change vision often
- Address the concerns and anxieties of the people openly and honestly
- Everything in the company such as training and performance reviews should be tied back to the vision
- Lead by example
Stage 5 removing obstacles
Amazon will be required to:
- Select change leaders whose main objective will be to deliver change
- Ensure that the organizational structure, job descriptions and systems of evaluating performance and providing compensation are line with the vision
- Identify and reward individuals that make change happen
- Find out those resisting change and assist them to see what is necessary
- Take action to eliminate barriers on time
Stage 6 creating short-term goals
- Identify projects that it can easily implement without the involvement of strong critics of the change
- Justify investment in each project by selecting non early projects that are expensive
- Ensure that the targets potential pros and cons are well analyzed to ensure they are achievable
- Reward those who assist in meeting targets
Stage 7 building on the change
Improvements should be identified by:
- Evaluating what has not been achieved and the areas that need improvements after every achievement
- Setting goals that will help in increasing momentum that has been achieved
- The kaizen model can help with the idea of continuous improvement
- New change agents and leaders of change should be used to offer new ideas.
Stage 8 making the change permanent
The change should be continuously supported by Amazon through:
- Continuously talking about the progress, mentioning the success stores about the change process often, and repeating other stories that can be associated with Amazon.com success
- Including the change objectives and values when employing and training new employees
- Recognizing key members of the organization’s initial change coalition publicly and ensuring that their contributions are remembered by both new and old staff
- Developing plans that replace critical leaders of change as they leave the organization to ensure their legacy lives on in the organization.
4.3 Develop appropriate measures to monitor progress
Outcome based evaluation (OBE) will be used to measure progress of Amazon.com implemented changes. This approach will be used to measure whether the implanted change results in a difference in Amazon’s business. OBE systematically determines whether a program has attained its goals and an organized process of creating a program using this approach assists in establishing visible benefits, assess these benefits, clarify the target audience that receive the benefits. OBE will provide information on (Müller 2014).
- The target audience
- The kind of resources required
- The source of resources
- The actions that need to be taken
- How the audience has benefited
|OBE for Amazon.com
|Sustainability reports to be provided
|Employees, shareholders, consumers
|Hire new staff who are experienced in issues of sustainability
Increase resources in the areas of sustainability
|5 qualified individuals are hired.
Increase the corporate responsibility budget by 50 percent.
|Improve the public reputation of Amazon in sustainability reporting
|Marketing efforts of the company
|Increasing social media presence
|Hiring 2 staff members to tackle the social media pages and provide feedback on sustainability issues
|Enhance the reputation of Amazon.com among investors and consumers
|Investors, consumers and employees
|Develop goals for improving sustainability issues
|List 5 of the most important objectives that helps in attainment of sustainability goals
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