M AKING S ENSE OF C HANGE M ANAGEMENT , 2 ND EDITION C ASE STUDIES – TEXT AND QUESTIONS Contents Case study 1: Aster Group 3 Case study text: Aster Group 3 Introduction 3 History, culture, orientation 4 Drivers for change 6 Leadership 8 No shotgun wedding 9 The transition period – one year on 11 Project management 12 Organizational development 13 Developing management and leadership capacity and capability 14 Case study questions: Aster Group 17 Individual change 17 Team change 17 Organizational change 18 Leading change 18 Case study 2: The Institute of Public Health in Ireland 19 Case study text: The Institute of Public Health in Ireland 19 The work of the Institute 19 Beginnings 20 Initial challenges 20 Strategy implementation 22 Vision and values 22 Leadership style 23 Management board 24 Working across the border 24 Learning 25 _____________________________________________________________________________________________________ © Cameron and Green (2009)*. *case study text taken from Green, M (2007) Change Management Masterclass , Kogan Page, London. This resource is part of a range offered free to academics using Making Sense of Change Management as part of their course. For more academic resources, please visit www.koganpage.com/resources. Page 1 of 48
HRM317 – TAKE HOME EXAM QUESTION 1 Challenge Bega Cheese Ltd has historically been a company with a strong sense of culture, openness to change, and commitment to achieve the best results possible. This can be exemplified through the mission statement alone. In order to meet these goals however, a company must change progressively over time to adapt to the changing markets and access modern opportunities. Bega effectively initiated a change process to do this, when they shifted from a cooperative company to a limited one, in order to sustain a competitve advantage, and meet the aggressive needs of the markets while keeping up with their competitors. For the purposes of this paper, the commercial paradigm shift that Bega Cheese Ltd has made, although necessary, presents the primary challenge. Stemming from this are the secondary challenges relative to human resource management (HRM), innovation, and strategy and culture. Crucially, what must also be identified for the purposes of this paper, is that these secondary challenges are all interrelated to some extent. Bega Cheese Ltd therefore must address these challenges carefully, and understand the integrated complexities of change that will arise, dependent on which avenue they choose to take. For example, Bega Cheese Ltd cannot effectively manage and improve the strategy and culture of the company without addressing HRM. Extensively, innovation and strategy must be improved by attempting to pragmatically alleviate any potential barriers facing the company in the HRM sector. Moreover, the relevant stakeholders evident within Bega Cheese Ltd have been the people assisting and guiding the change process. This began with the Chairman of the company in 2003, when it was recognised that cooperatives have an inherent issue, in that although it is the preferred style of work which has been the way of the business, it creates challenges when attempting to meet the complexities of a competitive market. Furthermore, the next identifiable stakeholder are the shareholders who deliberated to vote in favour of Bega Cheese Ltd becoming a privately owned company. Next, the employees are clearly stakeholders as they change within the business and undergo this process. Ultimately, the primary challenge revolves around the shift which Bega undertook, and this is the overarching challenge throughout this case study. Alternatives As mentioned above, the primary challenge facing Bega Cheese Ltd is structured around their shift from a cooperative to a limited company. In light of this, Bega then set out to initiate mergers and acquisitions with major companies to serve functions in HRM and drive innovation. The purpose behind these mergers and acquisitions with companies like KRAFT from a HRM perspective, was to provide and maintain employment in the towns while giving back to the community, consistent with the ethical framework of the company, despite the adoption of established technology. Additionally, the employees gained through the mergers and acquisitions aided the innovation process, as employees were then trained and developed through TAFE training courses to compliment the innovative functions of the company. Here, the inextricable link and interdependency between the functions is evident, as HRM and innovation go hand-in-hand. However, in doing this, Bega failed to acknowledge the cultural clash which would inevitably take place when combining the values of other businesses, particularly after the shift from a cooperative company to a limited one. Naturally, there would be resistances to such a process, and alternatively, Bega could have implemented a framework to alleviate the cultural clashes between the merging companies. This could have been achieved by developing an intricate and overarching framework which addresses the culture and strategy of HRM, as innovation is dependent on them. Extensively, to build on this and increase awareness, Bega Cheese Ltd would benefit from an assessment of the culture behind their mergers to understand the potentiality for clashes or identify synergies. This is relevant to the primary challenge as the choice to divert from a cooperative to a limited structure calls for a shift in the constituents of the organisation, which can be implemented effectively through this change management process. Solution(s) Bega Cheese Ltd would have benefited from an overall framework which takes into consideration innovation, strategy and culture, and HRM conjunctively, while initiating their relevant business mergers and acquisitions. It is recommended that Bega Cheese Ltd incorporates Galbraith’s Star Model, as it creates direct and corresponding links between innovation, HRM, and culture. This model should routinely be followed as it outlines that if there are inconsistencies between strategy, structure, and people, then a declination in productivity and unity becomes possible. This is also relevant here as Bega need to manage the expectations and potential conflicts between external and internal factors. It is recommended that this Star Model is used as an overarching framework, then the subsequent solutions offered should be implemented secondary to this model. Therefore, upon the execution of the Star Model, it is recommended that Bega Cheese Ltd exercise the pragmatic and relevant linear model in relation to innovation. However, before adopting this model, Bega Cheese Ltd need to undertake in research and development (R&D) internally, to help manufacturing and increase awareness. This would be analogous to the organisational goals put in place, helping to sustain competitve advantage, and remain the top quality cheese product company in the country. Furthermore, the credibility for this model is reified through Bega’s intentions to utilise their resources in a way which mirrors the VRIN capabilities. Extensively, Bega should be aiming to align these two innovative models with the resource-based view to sustain and increase their competitve advantage through their established technology and employees. Subsequently, Bega can improve their HRM by linking it with performance, in unison with the performance outcomes proffered by Guess (1997), and in particular, the differentiation strategy. It would be ideal if they could adopt this process, as it would compliment their T&D processes for the employees. Further, the model offered by Ulrich (1997) should additionally be utilised to strategically manage the transformational change process which will occur through the mergers and acquisitions. To emphasise the interdependency here, the cultural and strategic models need to be applied consistently with the HRM models. Therefore, in order to ensure effectiveness when adopting HRM practices, Bega should make sure to incorporate the iceberg model to create consistent core values across the organisation. If this can be achieved, then it will minimise the amount of restraining forces which can take place in a change process, as aligned with the force-field analysis. Execution Across all the models and recommended solutions, there is one underlying process in particular which can ensure success upon adoption. If Bega Cheese Ltd can execute an effective R&D strategy, it will allow the organisation to understand the reason for the models and how to implement them to address the potential conflicts. R&D will be the instrument to gauge how performance driven the company needs to become, to understand the core values of other businesses for mergers, and to identify and neutralise the restraining forces in a change management process. Despite the fact that R&D would be the most effective way to minimise a lacklustre approach to managing the primary challenge, there are a few downfalls which must be taken into consideration. The first disadvantage of implementing R&D is that it can be relatively expensive. The process is not entirely cost-effective, but the benefits which flow as a result of R&D outweighs the risk/s of not optimising the process. The current R&D process throughout Bega is haphazard and failing to address the correct problems. If it can be targeted to focus on the suggested HRM, innovation, and strategy and cultural theories, then it is believed that the R&D process will be beyond beneficial, as it will begin assisting the organisation in more than just one facet. Moreover, R&D is a time-consuming process which would also be more attuned to providing a long-term solution. Even though this is the case, it can be observed through the Star Model that such a process needs time, planning, and accuracy in order to be effective and proffer the correct remedies. This would be paramount for Bega, because this model would offer an immediate response to the primary challenge which was identified for the purposes of this paper. Subsequently, the models then offered under the Star Model would align and correlate with the goals of the organisation, while addressing the secondary challenges faced by Bega. Ultimately, Bega have implemented strategies and procedures in an attempt to neutralise and respond to the inherent risks of change. However, these need to be built on and better understood through R&D, to adopt the relevant frameworks. These will then, in turn, offer a guide to not only respond to, but prevent further instances from occurring in the future. It allows for Bega to become a proactive company when attempting to facilitate a change management process, particularly in relation to innovation, HRM, and strategy and culture. Word Count: 1466.