Executive tries to implement the change to building strong

 

Executive summary:

James Pierce, newly appointed
general manager of the Jackson plant of the Rose Company, have responsibilities
of achieving cost effective production with keeping high quality by implementing
new methods of production prior to starting new plant through testing the value
of a decentralized operation. He has capabilities and personalities which
suitable for leading change, however, does not have a concrete power, networks
in this plant, expertize in production, and he expects to face any resistances.
In this situation, he tries to implement the change to
building strong relationship with empowered followers while controlling the
power of resistance by January 2019.

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Situational Analysis:

James Pierce has just been assigned
as a general manager of Jackson plant,
established units of the Rose Company. Pierce would have responsibility for the
management and administration of all functions and personnel, except sales, at the
Jackson plant. Pierce will require setting a goal for the organization
change, and the strategy
to aim the goal first. Therefore, Pierce
will require the situation analysis with various data, having
a communication well with management, middle
managers and employees to find recent issues and problems. After all, Pierce will realize that the key success factor will
be to obtain the agreement of cooperation with people to move forward the change
on time schedule. Pierce will analyze the situation,
problems, and solution
alternatives. Lastly, Pierce will set a
solution and its implementations.

 

To analyze the situation, first, Pierce
has analyzed the Jackson plant, he has
focused on the report line and the organizational structure. The manufacturing
operations and certain other departments have been under the supervision and control
of a senior vice president. The company has operated a highly centralized and
functional type of manufacturing organization for a long time. There was no
general manager at any plant at all. Each of the departments in the plant has
reported on a line basis its functional counterpart at the home office.

Second, the top
management of the Rose Company has concerned regarding the advisability of the
central control of manufacturing operations. The officers have decided to test
the value of decentralized operation at the Jackson plant because the record of
the Jackson plant has not been satisfactory for several years. Therefore, the board member apparently has believed that the
general manager at Jackson plant will be needed to know if the new experiment
in manufacturing methods and the required rebuilding of the organization will
succeed. This is the reason why Pierce has been assigned as a general manager.
Meanwhile, the Rose board has
approved the erection of a new plant in a different part of the city and the
use of new methods of production recently. Both lower costs of processing and
reduced manpower requirements have been needed to maintain competitive
leadership and gain some slight product advantage. Hence, the goal of Pierce is the success of the decentralized
factory to reduce the cost.

 Pierce will require providing the strategy as
soon as possible after the situation analysis, having
a communication well with the management, the
middle managers and the employees to find recent issues and problems. The new
decentralized factory would be favorable for the board members. To meet the
goal, Pierce could delegate the tasks to
managers with setting the time schedule. Considering these situations, the urgency pace of change should be urgent.

In addition, Pierce
requires to know himself because he requires delegating the tasks to relevant
vice presidents and managers efficiently. Therefore, here in
the situation analysis requires the assessment of Pierce’s
strength and weakness because Pierce needs to know his own capability and
capacity to obtain the agreement to collaborate with people. According
to the top management, Pierce’s strength will be the analytical capability, the general administrative capacity, and he will be liked by people. In addition, the toughness, the
ability to achievement for the important tasks, the
improvement of the efficiency and the aggressiveness to reach the goal are
highly suitable as a general manager. On the other hand, he used
to be an accounting executive in the controller’s
department of this company,
therefore, there is no
experience such assignment in his business life. In addition, since he is too aggressive to achieve the goal and he has no
connection with Jackson plant, it is possible that the employees
of the plant would not accept Pierce’s way as
a perfectionist.

According to Professor Kainen’s Lecture Note, a method for making change is to
see the need ahead of time and make the adjustments necessary. This requires
more skill on the part of managers. It requires them to convert the outside
pressure into a “force” for change that
has direction and speed. To be successful at this conversion process, managers need two
things: (1) Analytic ability –
Analytic ability allows them to diagnose the problem and create a solution (change), and (2) Power – Power
gives them the capability to implement the change. Power is required to get
things done. This applies to both the management operational responsibilities, and the management
of change. However, to
be effective managers must supplement their power with COMPETENCE, TRUST, AND LEADERSHIP. *1

It means Pierce’s characteristics are highly suitable for a general
manager to change the organization because he has both the analytic ability and
the power to aim the goal to change. However, he
requires the agreement of the cooperation with the employees especially vice presidents
and managers obviously.

 

Problem analysis:

The most critical
issues of this change are the existence of resistances which might impede his
success and Piece does not have plan for that.

Pierce also does
not have all power control since some of the vice presidents does not allow
Pierce to have total control and discretion in the new system. As a result, there are two different patterns of relationship
between the plant and home office and it will cause conflict between Pierce and
middle managers who still connect with those vice presidents. In addition, there might be other potential issues and resisters
which have not been determined or discussed yet.

Considering these situations, he needs to provide the strategy to make a success as
soon as possible. Without solving the critical issues, the
change cannot be proceeded.

As we mentioned in
situational analysis, to make a success
of the change, a manager should
have Analytic ability and Power.

Piece has a
leadership and his strength of analytical ability. For his powers, he has authority as a general manager, responsibility for rewarding, connection
with home office, emphasized as
company’s efficiency expert, and his character of toughness,
aggressive in reaching the set goals. His credibility and reputation from other
people is also well.

However, his weaknesses might affect negatively accomplishment
of the goal. For example, he has
less power in his network since he is almost unacquainted with anyone in
Jackson plant. Also, this is his first
assignment as a major line job. Therefore his power as the expert is weak.

There are some
resistances which we can be considered as potential issues in implementing the
change.

One resistance will
happen in the implementation phase. It is that the change or another decision
making may be delayed by vice presidents. They basically will not have the
direct control of Jackson plant in the new structure. However, as Larry E. Greiner (1998) states, it is difficult for top-level managers
who previously were successful at being directive to give up the responsibility
to lower-level managers. *2 In fact, some of
them are going to remain their direct connection with plant-level managers as a
dotted line. This may allow meddling of vice presidents, and
accordingly, the transformation
will be delayed or not happen.

The other will
happen in the planning phase. The absence of proper person of RAPID Decision model *3 (Rogers & Blenko, 2005) would cause reverse to the current system from the new
system. The new plan tries to aim to the decentralized organization but there
are resistances who would like to maintain current centralized model. The
implementation to the new system for Jackson plant might fail or delay if Pierce
does not have the person who can get agreement and input properly to vice presidents
who disagree with decentralized relationships. Therefore, he
should have a good communication and develop positive supports with management, middle managers, and employees to support his change.

As a problem recap,
Pierce does not have a complete power to lead the change by himself due to
company’s structure and his lack of expertise. Furthermore, it is likely to be expected
to be resistance from middle managers (in Jackson plant) who have the dot-connection
with the vice presidents in head office.

 

Alternative Solutions:

Option 1:

Pierce has the weak internal
connection in the plant. The decision making for the new implementation will be
done by top management and it means that he cannot handle the new organization
Chart’s implementation
by himself. Therefore, he
needs to establish the strong relationship with high-level-power who would
support his plan by having accurate situational analysis, well
communications, and
report of current situations of the middle managers and employees.

In addition, in order to lead the change, Pierce
should build a firm relationship with
as many middle managers as possible in Jackson plant by letting understand
the necessity in change and controlling their rewards and goals, then creating change-leading team. In
doing so, Pierce should control all of plant employees by fostering a sense of
participation.

Pros:

• Pierce can avoid resistance
reaction because people do not fight back against many managements who have
high-level powers.

• Pierce can provide the report with
the specific date to the top management so that credibility of him will be
increased.

• By creating a change-leading team, Pierce
can catch up lack of expertise,
influences and network.

Cons:

• Pierce might get a poor evaluation
from other managements because Pierce does not solve the problem by himself.

• Pierce might not get centrality due
to relying solely on higher-level power.

• Implementing procedure is
complicated and it holds the key to succeed.

 

Option 2: Create “small” project team
and Utilize subsidiary compensation system. Small
project team which is composed of some members belonged to different
departments. The purpose is to “cast” Pierce
in the role of General Manager. The small project team must require “inter-department
adjust function.”
Therefore, the
position of General Manager is inevitably emphasized. In addition, Pierce
should prepare for subsidiary compensation system to boost tasks of the small
project team.

Pros:

• Employees cannot help utilizing
New Organization Chart.

• Employees can obtain opportunities
to communicate with other departments directly without attaching the most
importance to each department’s vice
presidents.

Cons:

• Employees might do additional
works due to the small project team.

• Management cost might be increased
because of inter-department.

 

Option 3: Connecting the change
progress directly with evaluation of the plant level managers can be
considered. In other words, he can use rewards
such as bonus and promotion to motivate the managers.

Pros:

• It is easy to implement since Pierce already have the right to do it.

• It does not take time since building a relationship is not required.

• It can be a great motivation since money and honor are commonly valuable.

Cons:

• This is kind of a cool approach. Thus, it may not build a real trust between he and the
managers.

 

Recommended Solution

We recommend Option 1.  Piece can avoid resistances and achieve the
organizational change by utilizing commitment of top executive and by obtaining
powerful driving force from bottom-up approach.

To impose the change, Pierce should create some kind of
pressure, but at the current moment, it has
not happened severe problem which is visible for employees. In this situation, the
pressure which can foster the necessity for change is considered as power from
top management. Furthermore, Pierce does not have enough power officially and
unofficially to completely control his followers.

The power from top management will make the effectiveness of
resistances weak and move on to the change. In addition, by following steps involving major design change *4 (Goold &
Campbell, 2002), he
needs to assign new role and responsibility for the new units with the best
person who would move the change forward.  By assigning the appropriate
person who would support Pierce’s
assignment, it
should minimize the risk of resistance in the future.

 

To drive the change forward, Pierce cannot achieve it by
oneself. His role is to create organization with voluntary cooperation by
letting all of employees share same objective and motivating them through
empowering. In this case, As Todd Jick(1991) noted, Pierce should design a gradual nonthreatening and,
preferably, participative implementation process including the following
tactics; Explain change plans fully, Skillfully present plans, Make information
readily available, Make sure plans include benefits for end users and for the
corporation, Spend extra time talking, Ask for additional feedback from the
work force, Start small and simple, Arrange for a quick, positive, visible
payoff, Publicize successes. *5

To build relationship with as many as middle managers and
create a propulsive change-leading team, First, Pierce should communicate with
all of employees in Jackson plant and tell the necessity of change and call for
cooperation. Second, he should hold a meeting with candidates, do the
evaluation and identify proper persons who meet his requirement of passion for
change and agree on the importance of change to decentralize. Then, create the leader
team by electing leader from each department and foster voluntary cooperation
by empowering while making consensus in leaders’ meeting. Creating the leader
team also can catch up his lack of expertise in production processes and human
network.

By doing these, Pierce can have a concrete
power to lead the change, networks in this plant, and expertise in production.

 

Implementation: 

From our analysis
above, Pierce
should implement the change with “Top-commitment” and “Leadership” in the
following timeline to meet the goal, which
is the decentralized plant by January 2019 (we make this implementation plan under
the assumption start from January 2018 and complete one-year time frame).

 

(1) Every time until January 2019:
Using top manager’s power
for decreasing Pierce’s
resistances. For instance, if one
resistance interrupts his action, he
makes the tops control the resistance.

(2) Every time until January 2019:
Communicating with employees for establishing a rapport. For example, he
holds a lunch meeting once a week and has a frank heart-to-heart talk.

(3) January 2018: Electing project
leaders from each segment.

(4) February 2018- March 2018: Opening
a meeting for project leaders and defining the strategy through the discussion.

(5) April 2018- May 2018: Asking
leaders to settle each segments’ final
goal and their short objectives for attaining the goal.

(6) May 2018-June 2018: Defining the
policy and the schedule of the action in the meeting.

(7) June 2018 -Junuary 2019: Opening the conference with leaders for
confirming project leaders’ process
reports once a month.

 If he finds
out that they cannot proceed with their strategy in the meeting, Pierce
makes leaders explain why they cannot succeed with the plan as scheduled and
how they will improve it.