The Types Of Change Management Management
The most consistent thing in this world is variation. Changes are occurring all over the globe. More and more organizations are facing dynamic and changing environment. Reason can be of diversified workforce, adopting new technology, economic changes, social trends and political factors. Change has to occur therefore organizations must learn to deal with those in better manner than such change can improve the ability of organization and can also help to enhance employee behavior. Planned change is also a way to change the individual and group behavior which subsequently results in organizational success. Planned change activities are intentional and goal oriented. Individuals, groups and organizations at whole can face the change or changing environment. In such case people or at organizational level change is resisted. Various factors can be a source of resisting the change. Somehow this resistance is positive, as workers are reactive and later their behavior can be taught to deal with the change. Various models prevail to deal with the change and how to manage it. For that I will elaborate individual level, group level and organizational level respectively with various models and theories. (Robins, 2010)
Discussing individual first, as stated in learning dip theory when an individual encounter change the performance of the individual rapidly declines. And by the time passes on the performance level rises up as the individual get use to the change or individual may also learn to tackle it. If that is because of any skill fear than in that learning dip time the individual may master what fears him. Later the performance will become better and it will rise up as time passes on. Kolb's learning cycle is a model which helps the change agent to deal with the change. The cycle in given picture explains that very first an individual encounters a new thing or a change. Than the person take time to learn about it or to conceptualize it. Later on individual would perform the act after studying it from theory and would feel the experience of it. By performing all of these steps an individual learn. This also gives knowledge of four distinct types of individual learners. As few wants to study from theory others want to perform it and some may learn from watching (Green, 2004).
Behavioral approach is also used to study change among individuals. It's a simple theory which uses rewards and punishments to get desirable results from the employees. By that individuals can be motivated to change by offering them perks and by decreasing the resistance by punishment.1.2 Group Change Management
Motivational theories are also discussed by various social scientists under behavioral approach. In which important work was done by Maslow, who found out five major set of needs which employee achieves in hierarchical manner. As each need are satisfied, individual steps to higher level of needs. Hierarchy of five needs are physiological, safety, social, esteem and self actualization, as shows in the picture below.
McGregor added idea that managers assumes that there are two types of employees one whom are lazy and dislike work (Theory X) and others who like the work and are active (Theory Y) (Fallon and Zgodzinski, 2005). In terrelation with Maslow is that Theory X employee are dominated by lower level needs in hierarchy of needs and vice versa for Theory Y employees. Then comes Herzberg who gave the idea that employees can never be influenced to be motivated or changed until with sufficient motivational factors, hygiene factors which de motivate employees are also eliminated. By implementing these theories managers can manage change (Devies, 2007).
When two or more interacting and interdependent individuals come together to achieve unique goal a group is formed. Organizations may have formal or informal groups. Even when individuals in group come together there is a storming stage. In which diversified personalities and distinct ideas are conflicted among the group. Change management may also be required to settle the issue that who will be the leader to the group. Direction of group needs to be lead in straight manner for that group is to be lead in effective manner. As organizations are made by the combinations of various small groups. Groups have various advantages and disadvantages while making decisions. Advantage is of having more thoughts, diverse alternates but that may also be a lot time consuming. Still teams can be very effective when their goal is clear, have mutual trust, good communication and appropriate leadership (Coulter, 2008).2.0 Organizational change management
Change at organizational level can also be managed by various models and techniques. Kurt Lewin mentioned three important steps for successful change in an organization the picture given below explainis the hierarchy of each step.
Very first step is to unfreeze the status quo
with that second is to move toward the desired state or change.
Last step is to refreeze the desired state into permanent change.
In unfreeze stage efforts are made to change the individual and group resistance towards change. Than in movement phase driving forces are added which forces the behavior away from equilibrium stage. With that restraining forces are also decreased in movement phase as they hinder to move toward status quo. Once desired state held the position is maintained by balancing driving and restraining forces. It is also know as calm water metaphor (Judge, 2010)
Kotter's eight step plan is a detailed approach of Lewin three step models. In which above mentioned three steps are translated in more detailed approach for implementing change. In it Kotter explains important ideas for managers when they will be working as a catalyst that how they may work over Lewin's idea. To establish a sense of urgency, power to lead the change, new vision, empower employees, short term rewards, and reassess improvements and to reinforce changes by making relationship between new behavior and organizational success (Kotter, 1996).
Action research is another method which can enhance change process by systematic way of collecting data and then analyzing the factors which are hindering the change process. Later corrective actions will be taken against the hindering factors. Finally corrective actions will be evaluated to assure the effectiveness of the action research (Huxham, 1996)2.0 The Case
The case under discussion here is a situation prevailing in Saudi Electricity Company (SEC), which is the only electricity service provider in the Kingdom of Saudi Arabia. As the market is growing rapid so to meet the changing requirements of market and high demand and joining the word procedure and process especially after merging the four Saudi electricity companies in year 2000, this company planned to start a strategic ERP implementation program called "Nebras which is an Arabic name means "cresset". Nebras is not actually a project itself rather it's a continuous program which is composed of many different projects. In 2003 the feasibility study for this program started and in mid 2004 it was approved by the CEO of the company. the aim of this program is to replace existing procedures and process the best practices being adopted internationally and adopting the best available tools which. For that For that the company decided to have a vanilla implementation of ERP system (SAP) minimizing the customization of the software. The first phase of this project has started in 2005.
It is always critical to manage the change effectively after implementing a certain technology and a business process reengineering. Any transformation which is enabled by IT requires comprehensive approach towards system changes associated with ERP implementations. Without managing the change occurring in result of such a transformation an enter enterprises may not be able to adapt to the new systems to make performance gains (Yongbeom et al., 2005). Now days many organizations are turning to ERP which stands For Enterprise Resource Planning this aims to enhance the performance undertake better decision making and to built strong capabilities. This would also be a great help in attain the competitive advantage over its rivals. This system takes some major investments of the organization. Companies have invested about $50,000 to about hundreds of millions of dollars for implementing these systems (Sumner, 2005). According to another study it is speculated that the market of ERP may reach $1 trillion by 2010. The implementation of ERP system gives an opportunity to reengineer the whole business process undergoing and introduce change as it affects entire organization. That is the reason why high failure rate in implementing ERP is reported. Though The Reasons of Such Failure differ from one organization to another some of them rise from technical aspects of the system some are management failures and some happen because of social or organizational issues (Fiona, 2003). If we look at it with the view of an overall business an ERP system accomplishes some very important objective of the business which includes mixing of throughput of information. It maximizes the response time to customers it also helps in pushing the decision making to most appropriate lowest level (Sumner, 2005)
A very well saying by Deloitte Consulting, this system is a more like a packaged business software which makes a company mechanize and put together most of its business processes, as common data and practices are shared across the whole enterprise, and it also constructs and access information in a real time environment (Sumner, 2005). SEC (Saudi Electricity Company) is currently moving in the process of implementing an ERP system companywide to cover all business lines and its all processes and procedures such as HR, Finance, Distribution and customer service, and Logistics. As I described earlier the main aim of this program is to re-engineer current business process with the help of best practices being used which is called "Vanilla implementation strategy of the ERP system". In this paper, I am going to address and analyze the project critical analyze and explain the way SEC is managing the project toward achieving business strategic goals.2.1 Managing the change process
It's very important to recognize the need for change in any organization. At the time of implementing anything new, organization's culture and structure should be managed carefully. The involvement of ser should in all phases of the project must be assured; proper education and training must be provided to help change process to be seamlessly done (Fiona et al., 2003).
In may 2002 The CIO Nestle company's, Jerri Dunn said in an article written for CIO magazine, that no major software implementation is affected by the software rather its about the change which may occur. When an organization is moving to SAP they are actually changing the way people work in that organization, such a change becomes a challenge their principles, their beliefs, and the way they have done things for many, many years." (Gregg and Catherine, 2004).
A series of "job impact analysis" documents was developed by Amoco which is a leading US oil company. These documents were reviewed by the implementation teams and then by middle managers, to minimize their resistance and by "forcing" them to become involved. Though this experience failed and the IT function was not sufficiently equipped to carry out the SAP implementation. The main reasons of failure of the efforts were lack of training, Scarcity of experienced staff, education, and increasing overload. End-users resisted the new system and this requirement was underestimated at the beginning because the enough skill was not given to them at first. IT function must also be prepared to meet the IT management challenges that SAP brings about along with empowering the IT function with the necessary training and resources (Al-Mashari and Al-Mudimigh, 2003).2.2 Goal of change management in ERP implementation
Mostly change management is considered to be a set of separate activities taking place during a project. Conceptually, the aim of change management in ERP implementation projects is the relocating the ownership from the project team that designed and configured the new system and process to the end users and the internal clients who would utilize these tools and processes in their day to day activities.
Practically speaking this mean to deconstruct the ownership transfer into three basic drivers: (Gregg and Catherine, 2004)
Knowledge Transfer: ensures that employees know what to do
Responsibility Transfer: ensure that employees fully participate in the implementation
Vision Transfer: help employees translate new tools and processes into improved business results
For achieving transfer of ownership Communication is a very vital instrument. This process needs to be in a continuous manner. There are mainly three levels where communication is needed.
For awareness campaigns with the purpose of raising understanding and awareness among employees.
For utilizing the one-way communication channels like newsletters, a web site and road shows.
It is needed also to utilize the two-way communication or the interactive communication methods like issue-tracking, meetings, workshops, conference calls and collaborative web sites.
For validation sessions and other hands-on interaction to test concepts with subject matter experts.
Without the executive support change can never happen. A support actually means visible involvement and CEO's sponsorship. It has been acknowledged that a key success factor in ERP implementation is top management. Both commitment to resources and commitment to change management is influenced by it (Fiona et al., 2003)2.3 Role of Change Management Team
There are certain factors that change management seeks to align such as End User understanding of the change impacts and maximizing the benefits of the change. The change management team handles following main activities:
Managing business impact
End User Training
Surveys before launching the project
Measuring site readiness2.4 Case Analysis and Discussion
I will now examine and evaluate the project qualitatively, based on the facts and information shown in the case, having an eye on what was stated in the literature review. I will analyze the case using the same topics mentioned in the literature and evaluate the situation on three grounds i.e.
The company should take a serious lesson from the failure of other companies' ERP implementation projects. And there must be a change management team as part of the implementation program. In the following sections, I will discuss the issues related to change management in our case.2.5 What motivated SEC toward ERP systems?
Several top management top management workshops were conducted by the company in order to come up with the drivers for changing into ERP systems for each business line and the whole company. The forces for change were revealed by these workshops and it also helped in diagnosing the problem. The main motivators in our case are replacing legacy systems, standardizing and simplifying business processes and systems, and improving customer services.2.6 Business Process Re-engineering and Decentralized Decision Making in SEC
In this case the company is working in the market where it has monopoly with a vertical hierarchical structure. This structure could prove to be appropriate in such market when the company was looking for efficiency, specialization and control through centralized decision making. The company chose to re-engineer its business processes as today's forces for change are different. A decentralized decision making process is required for re-engineering which has a tendency to flatten organizational layers which means to empower employees and decrease the need for mid-level management. With existing organizational structure decentralizing decision making would be a very difficult thing to manage and this be an obstacle in taking full advantage of this step.3.0 Organization Efforts to overcome resistance to process changes
The efforts are made at three levels in the organization following are the kind of changes that are taken steps for.
Individual change management
Organizational change management
Team change management3.1 Individual change management
The individuals involved in the change process need to be addressed separately and promptly and to ensure the end user involvement in the whole process. For that purposes following ways are adopted by the company.3.1.1Training and End-User Involvement
The employees of the business or the end user employees or those individual which are effected by any change occurring within the organization may be a part of it while being n any of the following roles.
Power user (Trainer)
Part time subject matter expert
Functional teams leaders
Those with knowledge or experience in one or more areas of SEC business process A Subject matter expert will play a vital function in overcome resistance and facilitating acceptance of the re-engineered process, since they remain in their departments business, have respect of their peers and would be the link between the project and the business as a communication channel.
They will also heavily be part of system simulation workshops and project. They are also engaged in conduction the training materials and training and development programs. And eventually they also play monitoring roles.3.2 Team change management
It is very essential that the teams formed for implementing any change are trained and made familiar of the consequences that may occur which can either be good or bad .for managing the change at team level the organization took following measures.3.2.1Cross Functional Coordination
In the case under discussion here our company worked very well on this issue. They actually formed a navigation committee which had to be on top of the project team with the aim to resolve any conflict and provide continuous commitment and support to the projects teams.3.2.2 Project Team & the Project Charter
A Program slogan or name "Nebras" for the Project department successfully This department has a manager which is the champion of the change agent it also contains external and internal consultants and change management project management and technical support team are also part of it. The point which is observed mainly here the team in conducting its operation in the eastern operating area which previously was SCECO East and the change agents and many other employees were from eastern area to. Foe dealing for this situation which could have been a cause of a great resistance of change in these areas and other operating areas too, several workers were assigned as being fully dictated to be the representatives of Nebras in such places.3.3 Organizational change management
It's very important to manage the change at organizational level as well as it affects the working of the whole organization as whole. In this case following is the areas our organization worked o to manage the organizational change after implementing this program.3.3.1Change Limiting Conditions (victory organizations)
The manager of the program gets hold of successfully the commitment of the top management to this program. There can still be some limiting conditions existing in organization and become an obstacle eventually. The formal organization which involve a formal or hierarchical structure certain procedures and policies and systems of control which are very change to change become the main cause of problems. This could identify that the top management's level of commitment is very limited. The culture pertaining in any organization is also an obstacle. In this case I would mention that the culture of this company is not much competitive or say a learning culture. It actually is more like the culture of government organizations to some extent. Such rigidity will become a hurdle in the ways of implementing any change.Personal learning
To overcome the resistance which may occur after implementing change many efforts were done to prepare the organization for any such consequences due to the re-engineered process. These efforts include the employ involvement in the project communication effort and awareness campaigns along with training of the end user and interacting strongly with the top management. A combination of reasoning and education approaches has been used. The most effective means were that they emphasized the role of change management in the project. Following are some places where their strategies worked out effectively.
Transformational champion (leader)
Placing high importance "striving" business process re-engineering around ERP best practices
Striving team work
SEC methodology (implementation plan) toward the implementation process
Heavily involvement of business employees in the projects along with technical peopleConclusion
Along with above mentioned efforts done the company still there are many areas which still need to be addressed and to be worked on. Rewarding system and the compensation system both pay a crucial role the in process of change in any organization. to harvest the most gains out of their huge investment. SEC works being a victory organization for gaining the most out of ERP system and re-engineered process its hierarchical organizational structure could be a major obstacles. Taking an example I can quote here that ERP encourages empowerment and elimination of non value added activities to maintain fast customer responsiveness and lower costs, but the organizational hierarchical "control" structure could reduce this. This also seen that the company- wide participation of the employees is not very well conducted. The projects must be linked to the rewarding systems to encourage and motivate employees. The employees at the managerial level must be educated well. Taking the look at the discussion section we can also highlight the major areas where SEC successfuly executed the program activities and controlled change resistance.
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