Page 1: Introduction to Change Management

Overview

• Course Title: The Management of Change

• Institution: Mona School of Business & Management

• Academic Year: Semester 2 2024-2025

Page 2: Learning Objectives

Objectives

1. Analyze the reasons for individuals’ unwillingness to change as shown in the ‘Who Moved My Cheese’ short film.

2. Discuss the internal and external factors responsible for an organization's need to change.

Page 3: Diagnostic Stage of Change

Key Components

• Video Resource: "Who Moved My Cheese"

• External Forces: Factors causing organizational change

• Internal Forces: Factors within the organization contributing to change.

Page 4: "Who Moved My Cheese?"

Questions for Discussion

• What issues are identified in the video related to change management?

• How do characters in the film respond to change?

Page 5: Relationship Between the Environment and Organizational Change

Global Environment (Uncontrollable)

• Economic Forces: Impact of recession, Brexit, etc.

• Competitive Forces: Comparisons like Netflix vs. Blockbuster

• Technological Forces: Advancements impacting business models

• Natural Disasters: Effects of hurricanes, earthquakes, etc.

Domestic Environment (Uncontrollable)

• Political/Legal Forces: Changes in ruling party policies

• Competitive Structure: Dynamics in industry competition

• Economic Climate: Local economic factors affecting business.

Page 6: External Factors that Cause Organizational Change

Economic Forces

• 2007/2008 Recession: Various case studies

• Amazon: Revenue growth through Kindle.

• Ford: New brand establishment amidst crisis.

• Chrysler & GM: Struggles leading to bankruptcy.

• Domino's: Success through recipe overhaul.

• Lego: Growth through targeted advertising and expansion.

Page 7: Economic Forces during 2007/2008 Recession

Study Cases

• Amazon increased international sales of the Kindle amidst recession.

Page 8: Ford's Response during the Recession

Key Strategies

• Successful establishment of new brands (Taurus & Focus).

• Utilized a $23.6 billion loan to navigate financial challenges before the crisis hit.

Page 9: Domino's and Lego During the Recession

Market Changes

• Domino's: Adjusted their recipe to attract clients as an affordable option.

• Lego: Increased play in Europe and expanded in Asia through celebrity endorsements.

Page 10: Challenges for Chrysler and GM

Consequences of the Recession

• Consumers shifting loyalty to Ford.

• GM declared bankruptcy and received a government bailout.

• Chrysler required federal loans and merged with an Italian firm to survive.

Page 11: Competitive Forces in the Market

Case Study: Netflix vs. Blockbuster

• Blockbuster's bankruptcy in 2011 due to competition from Netflix and Hulu.

• Netflix's subscriber growth is notable, matching Canada's population.

• Technological leverage eliminated traditional brick-and-mortar presence.

Page 12: Competitive Forces in the Soft Drink Industry

Impact of Competition

• The Pepsi Challenge: Led Coca-Cola to reevaluate its consumer engagement.

• Issues arose when consumers rejected the new Coke product due to lack of attention to preferences.

Page 13: Natural Disaster Forces Affecting Organizations

Analysis of Impact

• Natural Disasters: Hurricanes, earthquakes, and diseases (e.g., COVID-19).

• Discusses the costs and physical damages to property affecting organizations.

Page 14: Internal Forces in Organizations

Factors Impacting Change

• Organizational structure, employee mindset, skills, and turnover.

Page 15: Factors of Internal Organizational Change

Key Categories

1. Organizational Structure

2. Type of Organization

3. Employee Mindset

4. Technological Resources

5. Financial Capabilities

Page 16: Visual Representation of Organizational Structure

Hierarchical Breakdown

• Structure may include a CEO, managers, foremen, and various levels of employees.

Page 17: Understanding Organizational Structure

Importance

• Explains the coordination of work and connection of tasks in an organization.

• Different structures facilitate varying degrees of efficiency in response to environmental changes.

Page 18: Key Aspects of Organizational Structure

Detailed Concepts

1. Centralization/De-centralization: Decision-making model.

2. Formalization: Documentation of rules and policies.

3. Chain of Command: Hierarchy within the organization.

4. Departmentalisation: Arrangement of tasks into departments.

Page 19: Centralization vs. Decentralization

Discussion Points

• Examination of which structure may be more efficient based on organizational needs.

Page 20: Formalization in Organizational Structure

Effects of Formalization

• Enhances consistency and predictability but may curb innovation and job satisfaction.

Page 21: Chain of Command and Hierarchical Structures

Types of Structures

• Tall Structures: Numerous management layers.

• Flat Structures: Fewer management levels for easier communication.

Page 22: IKEA's Organizational Structure

Hierarchical Overview

• Breakdown of IKEA's organizational structure as an example of effective management.

Page 23: Departmentalisation in Organizations

Types

• Functional: Grouping similar jobs.

• Divisional: Departmental separation based on services or location.

Page 24: Activity Structures

Overview of Organizational Activities

• Discussion of how activities are structured to promote efficiency and responsiveness.

Page 25: Internal Forces related to Type of Company

Key Considerations

• Industry needs, size, culture, and product types, including environmental regulations (e.g., bans on plastic).

Page 26: Employee Factors in Organizational Change

Considerations

• Mindset: Openness to change.

• Skills Set: Required training and development.

• Turnover Rates: Impact of employee transitions on change management.

Page 27: Technological Influences on Change

Technology's Role

• Adopting new technology vs. removing outdated systems to maintain competitive edge and reduce costs.

Page 28: Financial Capabilities in Organizations

Financial Strategy

• Focus on increasing revenue, promoting efficiency, and driving growth to support change.

Page 29: Case Study Preview

Next Class Discussion

• Title: "Huawei: An Exemplar for Organisational Change in a Modern Environment" by Zhu and Jones, 2014.

• Preparation for an in-depth case study analysis in the next class.