Sigtek Case Analysis
The Total Quality initiative launched by Telwork for its subsidiary Sigtek represents a common practice for Corporate America; "remaking themselves into significantly better competitors" (Kotter, J. 1995. P. 59). For Sigtek, the manufacturer of "printed circuit boards for signal handling" (Harvard Business School. 1990) the task was to transform an organization that "began to face serious competition in its marketplace" (Harvard Business School. 1990), showed declining revenues, and demonstrated considerable mismanagement in implementing strategic operations. The Telwork-Sigtek Total Quality program as with all ostensible change dynamics has as the "basic goal to make fundamental changes in how business is conducted in order to help cope with a new, more challenging market environment" (Kotter, J. 1995. P. 59). Yet, these change efforts in most cases fall dramatically short of their intended marks, a reality which is explicated via the Kotter change model; an eight phase process outline which limns the direction and steps necessary for an organization to undergo a successful transformation effort. Viewed through this lens the Total Quality initiative at Sigtek was doomed to failure for its lack of adherence to the Kotter dynamic.
Sigtek was an up and coming technology firm with specialization in the manufacturer of printed circuit boards. Their revenues had expanded to 60 million dollars and the growth pattern suggested that "Sigtek would be a 100 million dollar company within five years" (Harvard Business School. 1990. P. 1). Yet, Sigtek began facing growth headwinds including increased competition leading to declining sales of 40 million the following fiscal year, and a new owner Telwork which "made it clear that it planned to influence how its new subsidiary operated" (Harvard Business School. 1990. P. 2). An espy of the competitive landscape of Sigtek revealed that the pressures on the company which adversely impacted revenues and profits needed to be met with a bold change initiative. The Telwork Total Quality program had as its goal "to improve product quality and encourage better management practices" (Harvard Business School. 1990. P. 2) all necessary for Sigtek to meet the competitive challenges confronting them.
Critical Events in the Change and Implementation Initiative
Kotter's eight step model recognizes that successful change programs pursue a peripatetic "through a series of phases that, in total, usually require a considerable length of time; with skipping steps creating only the illusion of speed and never producing a satisfying result" (Kotter, J. 1995. P. 59). Sigtek's journey begins with the first step in Kotter's model, the establishment of a sense of urgency within the organization as to the stark nature of the "competitive realities" (Kotter, J. 1995. P. 60).
Establishing a Sense of Urgency
From the outset of the Sigtek initiative, John Smithers and others charged with presenting and implementing the program faced an uphill challenge in their delivery. The organization "characterized as autocratic and largely unresponsive to workers concerns" presents a culture which is anathema to Kotter's belief that "establishing a sense of urgency" (Biech, E. 2009. P. 2) is the most critical stage in the process of transformational change. Urgency matters according to Kotter because "change by definition, requires creating a new system" (Kotter, J. 1995. P. 60) and the top down vertical structure of Sigtek prevents the "aggressive cooperation of many individuals" without which there is no "motivation, people won't help and the effort goes nowhere" (Kotter, J. 1995. P. 60). Despite Smither's success in his capacity as engineering services manager, he believed that an obturation to success of the program was a "culture characterized by the extreme polarity which existed between the two sides of the organization: engineering and manufacturing operations" (Harvard Business School. 1990. P. 3).
The lack of urgency created by "deep organizational gulfs" (Harvard Business School. 1990) and a largely ignored employee base, fed over to the leadership, namely Charles Bradley a "largely absentee president" (Harvard Business School. 1990. P. 4) and Richard Patricof the operations manager,...
1990. P. 11). As such the change platform quickly lost steam as it could not meet Kotter's second step, "forming a powerful guiding coalition" (Kotter, J. 1995. P. 59).
Forming a Powerful Guiding Coalition
Step two of Kotter's process looks to the organizations members to join a committed team of leaders engaged in a forward looking agenda. "In cases of successful transformation efforts, the leadership coalition grows and grows over time" (Kotter, J. 1995. P. 62). At Sigtek, Smither's recognized "how resistant the culture could be to change" (Harvard Business School. 1990. P. 4), a point which prevented the enlargement of the team requisite to fulfill the Total Quality reform. The lack of "cooperation on a companywide scale" (Harvard Business School. 1990. P. 4) imposed a malaise which failed to achieve the "minimum mass" (Kotter, J. 1995. P. 62), critical to a worthwhile change effort.
The six Total Quality Goals of Telwork-Sigtek: provide product and service quality better than all competitors, be the lowest cost quality producer, relentlessly pursue quality improvement, manage through leadership, involve all employees through participative activity, and have employees who approach the job fearlessly; were straightforward however, their iteration and annunciation via the Quality Improvement Team failed in their effort to meet Kotter's middle strata of steps: creating a vision, communicating the vision, and empowering others to act on the vision.
The articulation of Telwork-Sigtek goals "promised the company would be well on its way to becoming a leader in the telecommunications industry" (Harvard Business School. 1990. P. 5), yet missing was a "compelling statement of where all this was leading" (Kotter, J. 1995. P. 63). The vision and its communication provide guidance to organizational members as to the purpose of the change effort and what the end result will look like. The evidence of lack of vision and its communication is seen in the apathy of senior management in response to the program. As Smither's recounts the program's rollout, no one in the executive team asked questions, cared, or seemed to comprehend (Harvard Business School. 1990. P. 6). Clearly, if leadership cannot gel around the concept, the difficulty in organization wide buy-in will be difficult. Kotter notes that as "senior executives behave in ways antithetical to the vision; the net result is that cynicism among the troops goes up, while belief in the communication goes down" (Kotter, J. 1995. P. 63). Further, the empowerment of employees to act on the vision of the change effort was absent at Sigtek. "Although the training manual stressed the importance of encouraging worker participation and input; employees were ignored or, worse yet, viewed as troublemakers" (Harvard Business School. 1990. P. 9).
Short-Term Wins, Consolidating Improvements, and Institutionalizing Change
Steps six through eight of the Kotter plan, unsurprisingly are absent from the Sigtek directive implementation. Of these steps ensuring short-term wins is the most critical to an effective change initiative. At Sigtek this concept was illustrated in the "bouncing boards" problem, and the inefficiency of the organization in rectifying the issue. Smither's was disgusted by the bureaucratic ineptness of the operation particularly because "Patricof was always telling us to get known wins-to go for the easy wins, yet this was the simplest problem, and it was not getting fixed" (Harvard Business School. 1990. P. 8). Delays and ambivalence marked the Sigtek directive, "there was an autocratic, untrusting environment" (Harvard Business School. 1990. P. 9) throughout the organization. The lack of convincing short- term wins caused a ripple effect which blocked additional change from occurring, and prevented cementing any real reform into the company structure. Kotter notes "without short-term wins, too many people give up or actively join the ranks of those people who have been resisting change" (Kotter, J. 1995. P. 65). Resistance to change impeded Smither's and others ability to affect positive reform, evidenced by "company morale dipping lower than ever" (Harvard Business School. 1990. P. 10), discontinuity in the training programs, and efficacy of the directive. Resistance at Sigtek and all organizations has roots however, and these core issues can be found throughout the Kotter's model.
Root Causes of Resistance
The dysfunction at Sigtek is representative of how resistance to change directives undermines efforts to transform the corporate environment. This idea is seen most perspicuously in Kotter's first step, creating a sense of urgency. "If you get the first step wrong, nothing afterward will work" (Biech, E. 2009. P. 3), and at Sigtek this reality proved correct. Telwork-Sigtek while looking to "improve product quality and encourage better management practices" failed to address the critical importance of their Total Quality effort in achieving a more competitive corporate structure. The failure stemmed from the lack of a direct connection between the directive and the outcome, but also in the initial development of the program as a change that could be implemented quickly. "Telwork did not seem to understand that a major corporate change typically takes years" (Harvard Business School. 1990. P. 11), yet the pattern throughout the implementation demonstrated that "Corporate had a schedule"…
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