BPP University College

Business School

Declaration Form in respect of all assessed work at postgraduate level

Do not write your name anywhere on this part of the form or anywhere on your assessed

work.

Student Record Number (SRN): 1047667

Degree: MSc Management with Streams

Module: Leadership and Change Management

Date of submission: 19/08/14

Where relevant, question number:

Submitted to BPP Business School, BPP University College as part of the assessment for an

academic qualification of BPP University College of Professional Education.

I confirm that I have read and understood the BPP General Academic Regulations and Manual

of Policies and Procedures on the presentation of written work, and the specific requirements

relating to this piece of work including any Code of Practice relating to the degree for which it is

presented.

I declare that the work attached to this declaration complies with the University’s requirements

and is my own work.

I consent to reference of this work to a plagiarism detection service at the discretion of BPP.

1

I further declare that the work (in whole or in part) attached to this declaration has not been

submitted in full or partial satisfaction of an academic award in another university.

I certify that the number of words in this assessed work including footnotes is 2534

Signed: 1047667 Dated: 19/08/2014

Table of Contents

SI Name of the Content Page No

1 Introduction 3

2 Internal and External challenges for senior management 4

3 Change Management Model: 4

4 Change management theories: 8

5 Recommendations: 9

6 Outline of Change Management Strategy 10

7 References 11

2

Introduction:

Strategic management is a very crucial part of the organization which formulates, implement and

evaluate decisions which ultimately help to reach the organizational objectives. Through this

process, strategic manager integrates all the activities in the functional factor of the business such

as marketing, sales, production etc that ultimately helps the organization to reach to its goals

(Mouton, 1964). 

In this paper we will discuss the strategic leadership and change management system in the

relocation process of Galaxy, their refrigerator production unit from Germany to China. The

leadership process and change management is very crucial part in this relocation process and this

relocation is very important for the organization to reach the organizational goal. In this

relocation process, it is important to understand the reason of the relocation that is globalization

process and innovation of Technology which seems to be very essential for the sustainability of

the organization. So, these relocation processes is very important for the organizationand it need

to develop a leadership process and a proper change management to reach the organizational

goals.

Leadership and Change Management:

The leadership is a way of setting direction to the people so that they follow the instruction to

reach specific goal. The leader has some social influences and shares his expertise in a way of

organizing people. In this process, the leader uses his personal traits, situational interaction; share

his vision in a way or organizing change within the organization as well as within the process

(Victor, 2002). In the relocation process of Galaxy, there are different conflicting issues among

the management and the staff and both the group have specific interest in this process. So, it is

essential to develop a leadership process in the organization so that the relocation process

becomes very successful and that will help the organization to reach to its organizational goals.

3

The change management is a process, tools and techniques in a way of managing people-side

change and also to achieve the business outcome (Creasey, T. 2008).The goal of the change

management is to develop a process, a system, an organizational structure so that the

organization can solve their specific problems or opportunities. Every change has specific impact

on the organizational process and the strategic manager needs to have specific strategies for

planning the change, managing the change and reinforcing the change. In case of Relocation

process of Galaxy, the strategic manager will need to prepare individual change model,

communication with different individuals and providing training to the people involved with the

process and provide resistance management so that the change becomes sustainable for the

organization.

Internal and External challenges for senior management:

In the process of change management, change management is a comprehensive term. In this

process, it is essential to see the change impact in both in the individual level as well as in the

organizational level.

As an organization Galaxy Technology Company will need to face the following external

challenges:

The resistance of change: As the galaxy has decided to move their production in the

interest of reducing production cost it would be a challenge for the company to sustain

the market as it affects in many other issues related to the Product such as fear of

unknown, fear of loss, fear of failure, cultural assumptions and values, brand value,

acceptance level and customer reactions in changing this things and actual marginal cost

of production and marketing impact etc.

Brand risk: When company would start their production plant in different geographical

continent and new production line would work it would take times to grow again

because some customers brought this product because they had a long time belief of the

quality of the production of the company in particular country setting. There is also

having a myth that the quality of the Chinese produced product is low which may

endanger for the Galaxy and put them in risk.

4

Loss of customers and customer’s reaction: As we state before, some customers

brought particular product because they have strong faith on particular country’s

production therefore it have a potential risk of losing customers when company move in

different geographic location. In addition to it, as we have seen from the case studies that

Issues of quality: As the production setting in new continent is completely new and

therefore the production quality is yet not known. As a consequence, an issue of product

quality is also a risk factor for the organization.

Risk of losing skilled labour: From the case study it has not been cleared after shifting

the plant in China and what actions will be taken by the company in retaining their

existing employees. In addition to it, how the employees will react in adopting in new

country. Again, employees have more potential risk of not willing to shift in new places

as well which ultimately resulted loosing of skilled labor.

As an organization Galaxy Technology Company will need to face the following external

challenges:

The effect of globalization: Multinational organizations are heavily involved in global a

change that may put the company on global competition in various aspects of business

and that is a critical issue for the senior level management officials.

The effect of workforce diversity: The workforce diversity increases the participation

of different social background and cultural workers that have an impact on overall

workforce of the organization.

Technological change: Due to the rapid change of technological arena it is also a

challenge for Galaxy as an organization in competing with contemporary market leaders.

Managing ethical behaviour and corporate social responsibility: It would be hard for

the galaxy to fulfill their corporate social responsibility in two different geographic

locations. As the company’s main customers based in Germany, Italy and European

region so it would be difficult for them to fulfill corporate social responsibility in both

In this process of changes in the individual level as well as the organizational level is very

important for the strategic manager and he will need to consider the existing change management

model and will have to think different aspect of relocation process of Galaxy. Most common

5

formal model of change management, the manager will need to have a good understanding of

different change management models and theories.

Change Management Model: The change management model is very important in

understanding the strategic change of the organization. Cummings and Worley (2009) have

mentioned that there are different change management model which are very interesting in the

analyses of change management organization. Some of the interesting model includes,

Lewin's Force Field Analysis Model:This model was initiated by psychologist Kurt Lewin in

1950. In this model, Lewin noted that the majority of the people would like to prefer and operate

within certain zones of safety (Lewin, 1943). In this process, Lewin proposed some stages such

as

Unfreeze: In this process, he says that there are some people who always resist the

change. In this condition, it is important to give some time to this people and motivation

need to be given so that the acceptance creates among the resistant.

Transition: after initiating the process, some people becomes confused about the

process and the transition period starts. In this process, adequate leadership need to be

ensured so that the transition period becomes stable within the process.

Refreeze: Refreeze is a also an important stage when the change is established and the

change is implemented and the company becomes stable again. But in this process, it is

also important to work within the new guidelines.

In this process, it is also important to have a balance by the interaction of two opposing sets of

forces such as the driving force and the opposing forces. In this process, it is important to see the

change the strategic manager wants to see, making a brainstorming or mind map for the driving

forces, brainstorming or mind map the restraint forces, evaluating both the forces, reviewing the

forces, the feasible strategies for the matter etc. Lewin's Force Field Analysis Model can be

showed as

6

From the model, we can differentiate the expectation of the driving force from the management

perspective and the restraining forces from the employee’s perspective and it is important to

tackle the situation for the overall development for the sustainable development of the

organization. In this case, the drawing line between the Galaxy management and employee is

very crucial for the both parties.

As the change was planned for Galaxy refrigerator production company a Kert Lewin’s three-

stage model of planned change can be very effective for them. The successful implementation of

their stage model that overly prescriptive and do not restrict anyone. Lewin (1951) suggests that

change is the preliminary factors that drive to resist the change should be identified. It can be

identified from the company’s Force Field analysis. According to Lewin the change is asserted

that change occurs as a result of shifting the equilibrium between the opposing forces removed.

Prosci’s 3-Phase Change Management Process: Prosci’s 3-Phase change management process

is also important in the change management process of the organization. In this process, three

stages includes, (i) Preparing for Change, (ii) Managing the Change and (iii) Reinforcing the

Change. In this model, Prosci’s model elaborates the individual change into the process and also

the organizational change management and in this process, he suggest a holistic solution in every

level in the organization. In case of Galaxy, it is very essential to follow the 3-phase change

management process such as prepare for the change in a long term way, then taking some

initiatives in China and India and at the same time, some change initiative of shifting the

refrigerator equipment to china and long tern relocation of the organization for the sustainable

development is very crucial initiatives for the organization.

Kotter's 8-Step Change Model

7

Kotter’s model is also very important in the understanding of change management process of

Galaxy. In this process, Kotter’s have elaborated different stage of changes such as,

Creating Urgency: in this process, it is essential for Galaxy to create a sense of urgency

so that the initiative of change is felt among the people of the organization.

Form a powerful coalition: In this process, it is essential to make people feel that the

change is necessary for the betterment. It is also important to understand the emotional

attachment to the process and it is also important to make a team in this process.

Create a vision for Change: In this process, it is important to determine the values for

the change so that people conforms to the changes. In this process, it is also important to

create a strategy so that the change initiatives can be taken within the organizational

process.

Communicate with Vision: In this process of organizational changes, it is very

important to communicate with the vision so that individual is not fluctuating from the

vision.

Remove Obstacle: In this process, the strategic manager needs to be sure that the

obstacle is dealt in a smart way that the change initiatives work in the organizational

changes. In this process, it is essential to identify, hire and change leaders so that the goal

of change is attained.

Create short term win: In this process, it is also important the change should be initiated

with the short term initiatives. In this process, it is essential to look for sure-fire projects

so that the rivals get some positive idea about the change initiatives.

Build on the change: In this process of change initiatives, it is essential to analyze what

is right and what is essential for the betterment of the project. Galaxy company can build

the change management strategies through analyzing the consequence of shifting their

plant in China.

Anchor the change in the corporate culture: In this process Galaxy can essential to

address the initiatives taken for the change and incorporate ideas for value adding for the

change initiatives.

In the relocation process of Galaxy, the Cotter’s 8 step change model is very effective as it

shows the ways of progress initiatives can be taken in an organizational structure. To resolve

8

this scenario, kotter’s 8 step change model has a great relevance to it. There should be a proper

communication between the key stakeholders of the organisation on the need of taking change.

When change occurs at an organisational level, then every member of the organisation is directly

or indirectly gets affected and henceforth to avoid any sort of hurdle a change model should be

used at organisation level, to prepare and plan to resolve the unwarranted situation.

Kotter eight step change model has many drawbacks and benefits. The advantages are that it is

the step by step, which is easy to follow model. Another is that it does not focus on change itself,

but rather the acceptance and the preparation of this change, which makes it an easy transition.

Focuses on the buy-in of employees as the focus for success.

Prosci ADKAR Model provides the insights for the individual level change that provides the

guidelines for individual level change initiatives. In this model, Prosci ADKAR says that

Awareness, Desire, Knowledge, Ability and Reinforcement are essential for individual level

organizational changes.

The McKinsey 7S Framework: The McKinsey 7S Framework is also essential to make sure

that the organization is working with harmony. This framework is essential in understanding the

organizational change within the organization. In this process, there are many internal factors,

some are external factors and some perspective creates within the organization. The 7’s model

will help in enhancing the performance of the organization, will effect on the future change of

the organization, will align the departments in a way of merger or acquisition.

Hard

Elements

Soft

Elements

Strategy

Structure

Systems

Shared

Values

Skills

Style

9

Hard

Elements

Soft

Elements

Staff

Fig: The elements of 7’s model

Mckinsey 7’s model is very important to understand the change initiatives and it is seen that the

change initiative are highly interlinked to one another with the hard elements and the soft

elements. These elements are intricately linked with the process and the change initiatives takes

strategic initiatives.

Change management theories:

In the change management process, it is also important to have batter understanding on the

theoretical knowledge of change management process. The theories includes,

Transactional Leadership: Transactional Leadership is also known as managerial leadership

which focuses on the supervision, organization and group performance. In this process of

transactional leadership process, the basic assumption goes to the understanding of efficient

10

management. In this process, it says that in a in a clear chain of command, the people perform

their best. Transactional leadership is a proactive approach which works within the

organizational culture (Christina, 2009). In this process, the employees are motivated for the self-

interest and Management-by-exception maintains the status quo which reduces stress and directs

for actions to improve performance. It also say that the workers follow the clear instruction when

they are working to achieve a specific goal for the organization (Duane, 2010).. In this process, it

is also important to monitor the employees so that they are giving their best for the organization.

In the relocation process of Galaxy, it is important to have a transactional leadership who will be

motivating the employees and will share the organizational goal and policies of the relocation so

that that the mutual benefit is ensured.

Contingency Theories of Leadership: The Contingency Theories of Leadership is also

important in the understanding of Change management process of the organization. This

leadership theories emphases on the traits or behaviors and situational factors which is very

essential in the relocation of Galaxy. In this process, the leadership process is seen as

consideration factors such as the behavior of the leader, the interpersonal relationship of the

leader, and his attitudes to the subordinators. In this process, it is also important to consider the

initiating structure such as role assignment, planning, scheduling so that the specific goal of the

organization is achieved. In thus leadership approach, it is very important to build a cooperative

relationship with the subordinates, In this process, it is also essential to have a structured

relationship with the member so that the standard procedure of leader-member relationship

develops. The position power of the leader is also important so that the reward and punishment

relation exists among the leader and member.

Fiedler contingency theory is also very crucial in the understanding of the leadership model

which shows different leadership style on the basis of Least-Preferred Co-Worker (LPC) Scale.

This is a task oriented leadership model which is very crucial for the organization in the

understanding of leadership model.

11

Situational Favorableness

Situational Favorableness provides crucial role in different situations such as :

Leader-Member Relations: It is important to have trust among the leader and the member. It is

important that members have the confidence over the member and the member also have the

confidence over the leader.

Task Structure: It is important to have a clear task structure of the leader and the member

Leader's Position Power: the leader will be enjoying the power to direct the group, will be

rewarded with the group and will be punished for the group.

In the relocation of Galaxy, it is very important to understand the role of the leader and the

change management will need to take initiative in finding the leader and there will be a fair deal

with the leader and the management so that the organization can reach the goal of sustainable

development for the betterment of both the group. In this process, the organization needs to have

proper strategy of the whole relocation process that will help the leader in the proper

management of the relocation process.

Recommendations:

In the relocation process, Leadership and change management should consider the impacts of the

globalization process and at the same time, it is also important to understand the feasibility of the

changes. In this process, it is also important to understand the future aspect of adapting with the

new environments etc. In this process, the leadership and change management will have to have

a proper strategy for the full relocation process. Here, it is important make segmentation of the

whole process and different initiatives will be taken for the successful relocation process of the

organization.

The implementation plan becomes the stepping stone for any project and it determines the

success and failure of the project. Therefore, implementation plan achieves high importance and

should be planned and decided by considering all the business factors which includes internal

and external and all the stakeholders should be taken in confidence. The widely accepted

implementation plan for strategic change being suggested by Johnson, Scholars and Whittington

12

has been considered to be implemented for Galaxy that are illustrated below: Gaining support of

the key stakeholders, who include key decision makers and the facilitators. They should be

provided with enough relevant information on the needs and benefits of adopting the planned

change.

The Galaxy Company should offer a lucrative offers and incentives for skilled labour and

offer relocation job offers to ensure the right skilled person in the organization.

In order to protect brand image and customers reactions the management should take

some precautionary steps and more responsible act with their key stakeholders.

As the employees are the most vital for quality product production therefore it is

advisable for Galaxy Company to ensure employees highly skilled employees

involvement in the process of organizational change.

A full detailed plan should be prepared with proper start and end date and should include

and define the various stages of the change process with the time frame. This detailed

implementation plan should be agreed by all the department heads and the decision

makers.

A strategy should be planned to obtain the commitment of the staff to make this strategic

change feasible and achievable to attract more new customers and fulfill the requirement

of the existing customers.

The ground level staff and the users who will be using the new production system should

be brought in, in the project plan and should be asked for their feedback and reviews for

ensuring the quality of the products.

The staff should be given proper recognition and reward on based on their performance in

the organization.

The staff should be given development and training programmed on the new skills

required which will help in making the implementation plan successfully without

compromising the quality of the product.

 Proper change control method and performance monitoring system should be put into

place

The changes happening at various stages should be analyzed and evaluated well.

13

To monitor the performance, the management should follow given methods, (Teachmebussiness,

2011):

Setting SMART objectives for every individual team which should be reviewed on

monthly basis.

The review policy needs to be adopted at both team and individual level on end of course

term.

Setting Benchmark for individual teams and then reviewing the performance against

benchmark

Setting KPIs for every team based on the work task they are responsible for. Quantity

based performance system should be adopted, like number of students enrolled, number

of student queries processed, number of students re-enrolling for other course, etc.

Quantified standards should be set for every individual teams, and the comparisons of the

performance should be made with standards.

360 Degree Feedback is considered to be one of the best performance measuring

instrument which helps to analyze the performance of team with every individual aspect

which is directly or indirectly related.

.

14

References

Aiken, C. and Keller, S. (2009). "The Irrational Side of Change Management". The

McKinsey Quarterly. McKinsey & Company. Retrieved 2009-06-18.

Blake, R.andMouton, J. (1964). The Managerial Grid: The Key to Leadership Excellence.

Houston: Gulf Publishing Co.

Changing Minds (2012). Stakeholders in change [Online]. Available at:

http://changingminds.org/disciplines/change_management/stakeholder_change/

stakeholder_change.htm [Accessed date 28 October, 2014].

Dean, C(2009). RIMER Managing Successful Change. Australia: Uniforte Pty Ltd.

Kotter, J. (2011). "Change Management vs. Change Leadership -- What's the

Difference?". Forbes online. Retrieved 12/21/11.

Lewin K. (1943). Defining the "Field at a Given Time." Psychological Review. 50: 292–310.

Republished in Resolving Social Conflicts & Field Theory in Social Science, Washington,

D.C.: American Psychological Association, 1997.

Scott, W.R. (1981). Organizations: Rational, Natural, and Open Systems. Englewood Cliffs

NJ: Prentice Hall Inc.

Schultz & Schultz, D. (2010). Psychology and work today. New York: Prentice Hall.

pp. 164. ISBN 0-205-68358-4

Value Based Management.(2011)Pettigrew dimensions strategic change [Online].Available

at

:http://www.valuebasedmanagement.net/methods_pettigrew_dimensions_strategic_change.ht

ml[Accessed: 21 August 2014]

Vroom, V. and Sternberg, R. J. (2002). "Theoretical Letters: The person versus the situation

in leadership". The Leadership Quarterly 13 (3): 301–323. doi:10.1016/S1048-

9843(02)00101-7

15