Change Management Using Various Organizational

Change Management

Using various organizational examples (different companies), please evaluate the major concepts underlying effective major business transformation and dynamic change management which we discussed in class, including: the new rules for organization design & business-wide integration; the strategic direction for organizations, focusing on high performance, processes and knowledge; the alignment and integration of six key factors in an organization for dynamic change; and finally the basic principles of change management. Do you agree or disagree with these major concepts; why or why not? Please explain you position using various organizational examples to reinforce your arguments.

Applying the many concepts learned in class to the high technology industry illustrates their effectiveness and potential to increase organizations' performance and effectiveness in the midst of rapid, unpredictable change. Dell's continual fine-tuning of their supply chain practices, including the definition of Vendor managed Inventory (YMI) in the context of rapid inventory turn environments is in the process of transforming the company's value chain (Walters, Rainbird, 2007). The Dell organizational structure correspondingly is being modified to support organizational design and business process integration so that the key performance indicators (KPIs) the company relies on including inventory turns can be maximized. Dell's culture is one heavily dependent on measuring performance to evaluate how processes can be improved over time to better serve their educational, enterprise business, small business and consumer marketplaces. Relying on the six key factors in an organization for dynamic change, the processes, systems and people involved with the company's supply chain are continually focused on how to gain greater levels of accuracy, efficiency and cost reduction from their efforts over time. This is specifically the case with the build-to-order sourcing and production process. Dell's value chain has grown to support the many sourcing, supply chain coordination, quality management, production scheduling and fulfillment processes that will ensure the company a competitive price and performance advantage in building customized laptops, PCs and servers. The core values of change management are engrained into the build-to-order process at Dell, and as a result the company has been responsible for more innovations in high tech manufacturing, specifically supply chain integration and forecasting, than any other who relies on build-to-order as a core process in their value chains (Gunasekaran, Ngai, 2009). It is critically important for Dell to have change management engrained in the continual improvement of their build-to-order process in order to survive. They have accomplished this by concentrating on giving employees a strong sense of ownership of their jobs, underscoring how critical this process is to keep the company moving forward profitably, and decentralizing supply chain and manufacturing management so they have the autonomy necessary to master their jobs. Change management must permeate an organization for it to become a competitive advantage over time (Judge, Naoumova, Douglas, 2009). Dell has been able to accomplish this on its most critical business process.

A second example from the high technology industry is the merger and acquisition activities of Oracle Corporation, whose CEO Larry Ellison has often said his business plan is to be the leading consolidator globally of enterprise software so companies need only come to his company to buy software (Arnesen, Thompson, 2003). Change management strategies inside Oracle therefore are centered on interprocess and intersystem integration both at the process and role levels. As a result, the Oracle culture can at times be quite stressful, as there is much uncertainly during any given acquisition what a person's role will be. The more common areas within Oracle, including Marketing, Sales and Operations are often reduced in headcount when an acquisition is completed. Given the rapid pace of Oracle acquisitions over the last ten years, the need for exceptionally strong change management programs is evident in their approach to process, product and role-based integration across the software company (Arnesen, Thompson, 2003). Oracle has taken a unique approach to change management which align with and accelerate the concepts presented in this course. First, Larry Ellison, Founder and Chairman, has appointed Chuck Phillips, CEO and highly respected former venture capitalist, to define the system-level integration requirements of the merger. Mr. Phillips is also responsible for defining the transition strategy and most important, defining how the current acquisition contributes to corporate business strategy. Oracle has shown success with managing change around mergers when the companies acquired are relatively small, critical to the strategic vision of the company and also have cost reduction potential. In this respect the change management strategies at oracle are consistent with research findings from McKinsey & Company's research on merger performance as well (Early, 2004). From the evaluated effectiveness of mergers that meet these guidelines, post-merger contribution to revenue is often at or above average when change management strategies are combined with a clear definition of the strategic vision that the acquisition is intended to fulfill (Epstein, 2004).

As the CEO/president of Lockheed Martin Astronautics (LMA) and given the tremendous competitive pressure in today's global market place, please describe how you would focus on your people, communications and organizational culture in order to implement major business transformation and manage dynamic change to, not only gain competitive advantage, but also to sustain competitive advantage in the global marketplace over the long-term. Use various organizational concepts to reinforce your arguments

Lockheed Martin Astronautics (LMA) is a global leader in the research, development, design, sourcing, manufacturing and integration of advanced technology-based defense-related systems and services. Organized into four divisions including Aeronautics, Electronic Systems, Information Systems & Global Services and Integrated Systems & Solutions, the company generated $42,731 million in revenue at the close of FY 2008. As CEO of LMA the challenge of attaining and then continually strengthening competitive advantage over the long-term in a very turbulent global economic environment must center first on creating a culture that embraces as change as a challenge. Change needs to be seen as a means to become more intensely focused on the collective goals of the organization. This requires the CEO to concentrate first on how to become a transformational leader (Gilley, McMillan, Gilley, 2009). For a CEO to be a transformational leader, one must strive for accuracy, authenticity, accountability, honesty and transparency -- in short all the attributes that make one trusted and consistent in ones' actions. These many attributes would assume one would have to literally walk on water to have them. Yet over time the best CEOs, and if I was the CEO of LMA I would passionately pursue that goal -- have focused entirely on how to build trust with their companies' managers and employees. Trust has been shown consistently to be one of the most powerful attributes of leaders who can effectively manage change and guide their organizations to goals, and in times of uncertainty, the most valued trait in leaders (Appelbaum, Berke, Taylor, Vazquez, 2008). That would be my personal mission and goal as CEO of LMA, to be a transformational leader and strive for that level of consistency and trustworthiness. Second, I'd create programs that would give employees the opportunity to better understand their core strengths and apply them creatively to their jobs. Finding the intersection of what they excel at relative to what their jobs require would give them a stronger sense of task and job ownership. Programs would also be created to give employees an opportunity for job enrichment, as mastery of tasks leads to greater motivation over time (Gil, 2009). In short, I would work very hard to make the internal culture one that sought to give employees the opportunity to master their skills while also giving them the autonomy to excel.

CEOs often spend the majority of their time defining short- and long-term strategies in response to opportunities and threats in the market. For the CEO of LMA the greatest cost factor is compliance of federally-funded weapons and aircraft programs. Compliance presents the greatest risk to aerospace manufacturers yet the greatest opportunity for differentiation as well (Prybutok, Ramasesh, 2005). Concentrating on compliance to the U.S. And foreign nations' defense departments and ministries of defense is critically important for keeping the company from having to pay costly fines and potentially damaging morale. Making collaboration across teams possible also can assist in more effective long-term approaches to overcoming resistance to change, and also nurture trust (Johansen, Comstock, Winroth, 2005). As the majority of LMA's products and services are heavily dependent on software, the defining of specific strategies and programs for ensuring high levels of change management are in place for the rapid prototyping and product development processes are one of the most critical areas of long-term strategic advantage. The development of change management strategies to the software development team level is critically important for any organization to stay current in highly turbulent, change-driven industries (Mohan, Xu, Cao, Ramesh, 2008). Coupled with this is the fact that compliance and auditability even of software, if done so that government auditors can quickly finish their work, can turn into a major time advantage. Looking to how to bring traceability and ownership of software quality into these complex processes can yield significant competitive advantages over time (Mohan, Xu, Cao, Ramesh, 2008). Software quality management, compliance, and collaboration across the entire organization also need to be integrated at the process and role level with the LMA supply chain. As the LMA supply chain is very unique in that it specifically deals with prototypes often that are under covered under security guidelines and clearances, there needs to be continual focus on change management and task ownership in this area as well. For LMA supply chains is their major source of pricing competitive advantage as the company ahs been responsible for several innovations in this process area (Cheung, Myers, 2008). In conclusion as CEO of LMA the challenge of attaining and strengthening global competitiveness begins with being a transformational leader followed by concentrating on transforming compliance into a competitive advantage, and also striving to create a high level of task ownership, mastery and collaboration within and between the company's teams and outside partners including the supply chain.

Please describe how you as the CEO/President of a company would effectively address, manage & use John Kotter's 8 STEP approach to evolutionary change in order to gain and sustain competitive efforts in the global marketplace. Specifically, evaluate each STEP; identify the strength and weaknesses and the pros and cons of each STEP; and highlight / illustrate specific actions within each STEP which could be taken using various organizational examples to support your arguments.

As the CEO of a software company focused on how to keep the software produced for Customer Relationship Management (CRM) as competitive as possible relative to larger competitors including Microsoft, Oracle, SAP, and others, I would use the Kotter 8 STEP Model as follows. Having referenced Kotter's work on leadership (Kotter, 2001) I would also focus on change management strategies that gave each employee an opportunity to see how their contributions are critical for the success of the company. As a start-up the 8 STEP Model is critical for getting lasting change in place to make the company more competitive on a global level. Step 1, Increase Urgency, centers on the development teams who will need to get software applications' key features and attributes completed quickly. Sales needs to constantly have a high sense of urgency to go after new potential enterprise and small business accounts to sell the software to, and services need to be focused on developing training materials. The positive aspects of this first step is that it gets the entire company moving rapidly ahead to objectives, increases the level of intensity of effort to attain specific objectives, and also creates more collaboration as teams strive to get to deadlines by helping each other. The downside is that often in organizations each department has its own perception of time. Second, infighting and often arguments can emerge quickly when a sense of urgency is injected into an organization quickly. Third, the entire project could be sabotaged if team leaders don't trust the lead on the entire project. The second step of building as guiding team is get the most effective leaders aligned and organized onto just a single team. These are the most credible and most trusted leaders in the company. The advantages of this strategy is that it can serve to minimize conflict by creating trust and communication across teams early on, and also create a greater level of communication. The downside is that often the strongest personalities dominate these teams. There is also the potential team members will become disillusioned and cause the entire project to fail. The third step of getting the vision right is critically important. The benefits of a strong vision sit hat it can greatly alleviate risk, make personal sacrifices more "worth it" in the eyes of team members for the goal to be attained, and also galvanizes the direction of the team daily. The disadvantages are that the vision of a team may not match each person's beliefs all the time, and may be especially challenging in global teams that are linked virtually through working relationships (Smith, Kuth, 2009). This can be seen for example in the approach Oracle has in the development of software in their Indian development centers (Arnesen, Thompson, 2003) or the challenges Dell has in making their value chain scale into Malaysia where the majority of their laptops are produced (Walters, Rainbird, 2007). The fourth step is communicating buy-in for the program and is typically the phase where people begin to accept the program. This is a very critical phase in the overall 8 step process as repetition is critical for keeping the change alive. The strengths of this phase are that if the strategy has been successful significant change in people's commitment to the program is taking hold. Additional advantages are that trust is created, collaboration is more efficient and progress is made. Disadvantages are that this is an area where employee cynicism can often derail progress (Wu, Neubert, Yi, 2007), costs of the project can spiral out of control as scope creep begins to be seen in the project as teams begin to define their own vision, and the project begins to languish without strong momentum. It takes a strong leader to get through this fourth phase. The fifth phase of empowering action is where the processes and systems in the way of attaining the projects' goal are removed. The disadvantages of this step are that this phase can take an inordinate amount of a leader's time to ensure that team members' needs are being met. Second, there is the disadvantage of having to change long-standing processes within a company which can take literally thousands of dollars and hours. It can be daunting to have to face a long-standing process that stands in the way of getting to the goal. In the context of the CRm software company, working with Salesforce.com to get the application on their AppExchange could be one such obstacle. The advantages of this step however are significant, as accomplishment is attained. Second, the advantage of trust being shown in actual results tends to reinforce the belief on the part of teams that they can attain their goals by working together. The sixth step of creating short-term wins has many positive aspects. It provides assurance that the goals of the project can in actuality be accomplished. It shows in actual evidence that the goals of the team can lead to significant accomplishments, and it gives teams a sense of mastery over their work. The downside of this step is that it can often lead to a sense of overconfidence and scope creep, in addition to a letting up on the urgency to finish the project. These can all cause a project to stall out. It is critical for leaders during this phase to actively focus on getting their teams focused on the larger, more significant goal. The seventh phase of not letting up is also a delicate balance of attempting to do too much vs. not enough. The advantages of this step are that it begins to engrain ownership and mastery of the tasks into the company, allows even more concrete evidence of trust and collaboration working, and also satisfaction of the goal being met. The disadvantages of this step is that by pushing for additional improvements could po0tentially lead to teams becoming disenchanted with the goal, becoming disillusioned and giving up. The last phase of making it stick has the advantage of bringing lasting change into the company, nurturing new roles and processes, and gaining competitive advantages as a result. The downside is that if the change is seen as potentially impacting a person's status in the organization they will fight it and attempt to sabotage its success over time. With all these steps in place to guide the development of a new CRM application to work with salesforce.com, the challenge would be keeping the momentum moving forward over the long-term and ensuring the lessons learned from the process were engrained into the culture.

As the new CEO/president of General Motors in today's current economic environment, including all of the economic and political activities which have taken place over the past year, please describe how you would address, manage and use business processes, information & knowledge and information technologies to enable GM to effectively undertake a major business transformation, major change, in its organizational structure, its management and its products and services in order to remain competitive in the global marketplace. Use various organizational examples to support your arguments.

If given the role of CEO of GM feasibly by President Obama and the current administration as the U.S. government now owns approximately 60% of the auto maker I would aggressively pursue a strategy of drastically trimming back unneeded, antiquated and inefficient processes in the automaker. Using the core concepts as defined in this course from Dr. Micheal Hammer I'd completely redefine core product development, supply chain, sourcing, compliance, manufacturing, fulfillment, dealer service and post-sales service using Business Process Re-engineering (BPR). Using BPR as the foundation of change management would also undercover large areas of duplication of effort and lost revenue opportunities due to lack of communication. GM is near bankruptcy and my rationale for such drastic change is that the company must become market-competitive very quickly or risk going completely out of business. BPR is often seen as drastic yet is exactly what is needed to turn GM around from being inward focused on large vehicles and become more focused on energy-efficient vehicles.

Second, as the Untied Auto Workers (UAW) is now a majority owner of the company and I'd make it very clear that change is the new constant, and that there is a need to get away from complacency and embrace challenge again in their jobs. I'd go through the Kotter 8 STEP process to redefine product development and also set lean manufacturing performance target goals for the UAW workers in each production center. Each team's salary and bonuses would be indexed to their production center performance. The greater the accuracy, cost reduction strategies in place and innovation within specific manufacturing plants the greater the bonus. The less the performance the lower the salary and bonus. Indexing performance to salary would send a clear message that each worker is not accountable to the union anymore, they are accountable to serving customers and building more efficient and cost-effective cars. As Oracle does with its consulting services business unit I would also index dealer margins to customer satisfaction at the dealer level (Kumar, 2007). Using J.D. Power data I would define performance benchmarks for dealers to hit. If they failed to hit the minimum level they would receive margins only on service products, yet if they excelled at customer satisfaction for GM customers they could earn an additional 10% of margin. Like Cisco, I would also index dealers to satisfaction and profitability over time and regularly trim the lower 20% every 18 months. In short I would run a pretty tight ship and make it known we were fighting for our lives as a company and provide Congress with complete accountability and transparency over performance. In summary as transformational leadership requires a very high level of transparency I'd post our performance on the front page of the GM website showing performance by production plant against goals and also contributions to profitability. The key to transformational leadership is trust (Appelbaum, Berke, Taylor, Vazquez, 2008) and as a CEO who would have a dotted line to the President of the United States, I would strive to deliver exceptional levels of transparency to inspire trust in the organization and industry.