Learning new theories and frameworks is usually a burden on a person to understand and imagine its application in real life cases. However, the Gobal Tech simulation case was an amazing chance for connecting what we have learnt (Why, What, and How organizational change works) to what we have discussed on the first day through cases and articles. From my point of view, the simulation gave the team three main added values. First, since it took place on the second day of the EMBA in addition to being introduced to the new group members, each member of the team got the chance of experiencing the teamwork activity with his team.
Thus, it allowed for knowing each other better through the engagement in the discussions and ideas sharing. Second, the simulation gave the team the exposure and challenge of being responsible for putting an organization on a change process, which required that all the members should be aligned to the cause. Third, we have learned the importance of working within a specified time frame and budget, which are of equal importance to the change processes and tactics selection. Finally, for me, before the course and simulation, I believed that the organizational change is all about the changes what will be applied.
However, now, I realized that the act phase including the changes required should be implemented after several core phases that direct the success or the failure of the organizational change. In other words, the change process starts with the unfreeze step in order to be able to implement the changes then refreeze the organization. Global Tech has built a very good reputation in the market as being one of the leading manufacturers of all the weather global positioning systems (GPS) in the world.
The first successful story showed that the company had a competitive edge over its competitors by having powerful R&D, engineering and manufacturing departments. However, the leader of the company was not analytical and reactive to the market shift, as there was a decline in the military sector, where their concentration, while there was boom in the commercial sector. In order to decide on the type of the change, which should be implemented, we have to consider the positioning and the scope for the organizational change. As for the positioning, Global Tech was uffering from losses over the last two years, which drove the company into a series of austerity measures. In addition, another two companies have become the market leaders in the commercial sector by formulating their own identity through satisfying the customer needs without technological complexes. Concerning the scope, the company was focusing heavily on the military sector and decided to add the commercial sector to their strategy. Thus, the organizational change for Global Tech was re-creation according to Nadler & Tushman (1989) (See Exhibit 1), as the change was reactive in terms of positioning and strategic in terms of scope.
In other words, Global Tech was experiencing external shifts in the market threatening their survivals, which required them to change their strategy. The organization has been paranoid of their technical abilities and of being the market leaders years ago in the technology of GPS, but they have ignored the market shifts in the customer needs and satisfaction. Applying the Mckinsey 7-S model (See Exhibit 2) on Global Tech simulation, we have formulated our plan according to the strategy, structure, systems, skills and shared values and beliefs that will help in the organizational change.
First, concerning the strategy, the leader has been reactive and changed the strategy by adding the commercial sector to the company’s market focus beside the military sector. Second, concerning the structure, hiring new employees to the organization in different departments to be responsible of the new market segments has modified the company structure, but the organization continued to be only hierarchical. Therefore, we were focusing during the implementation to have a cross-functional team with diversified experiences on the same table for adding value to the new strategy.
Third, regarding the systems, the new strategy has required the core change team to work on different systems for enhancing the company’s performance, such as cost analysis for offering a competitive price product, employees training and development, restructuring the compensation system and improving the communication across the departments as they were not aligned. Fourth, as for the skills, the company was competent in terms of its R&D department, which provides the high-technological GPS.
According to the new strategy, the cross-functional team purpose was to make use of their high technical skills in producing more commercially oriented products. Fifth, concerning the shared values and beliefs, all the stakeholders were not agreeing on the cause of the change although they have practiced the downsizing in the company through laying off employees and reducing budget. Thus, part of our plan was based on guiding the concepts around which the company’s strength is built and creating the sense of urgency for the changes required by having a common belief on the organizational strategy.
Since there were losses in the past two years, Global Tech needed to align all its key organizational elements internally and externally. Global Tech has fallen in the Fit-conserving change according to Siggelkow (2001) (See Exhibit 3), as there was a noticeable declining financial performance in the company but without clear internal misfits in the organization structure. Thus, the company was planning to react to the environmental changes by playing a new game through rearranging its internal departmental structure and systems to achieve the desirable goal of leading the commercial sector in the GPS market.
At the beginning, all the team members were engaged in an open discussion about the case until we identified the main problem of the company, and accordingly we agreed on a plan starting by classifying all the tactics under their related steps (Understand, Enlist, Envisage, Motivate, Communicate, Act, and Consolidate), then prioritizing the tactics, then eliminating the un-useful tactics based on common agreement or voting, and finally calculating the plan time and cost according to the budget.
The three main things that enhanced my learning are proper understanding and analyzing before performing the change, communicating and handling feedbacks. Although the act step may include more tactics than others steps, most of them may not work perfectly if the organization has not been prepared through understanding the problem, analyzing the stakeholders, developing the vision and strategy, motivating the employees, and communicating the vision to be stated clearly for all levels in the organization.
On our team level, the group communication has benefited our plan, as it enabled a better understanding of the benefits and drawbacks of some tactics that may have not been noticed by the team members individually. During the simulation implementation, the good communication played a great role in getting the employees buy-in even though some of them may be affected by the new strategy and vision. Finally, we have to receive and handle people’s feedbacks during implementation, as someone may give a tip to re-organize the plan in a more effective way.
Taking the feedbacks into consideration is very important to the success of the organizational change even if the feedback is coming from a resister. Although we have reached our target of getting buy-in of 63%, we have underestimated some tactics, even positively or negatively, to our plan through using them in the wrong time or not using them. One of the positive tactics that we didn’t use is the team pilot project, which was an important tactic to use in order to form a more focused team to be the successful model of change.
As for the positive tactics that were out of their timing order, the departmental Q&A sessions should have been moved forward in our plan after developing vision and strategy and providing all the information about the competitors and the financial situation of the organization to all the departments. Departmental Liaison Team was a highly effective tactic but should have been implemented after providing the organization members with the required trainings to understand the benefits and dynamics of the teamwork.
On the other hand, the negative tactic that we used was the re-engineering of the company, which was mainly about departmental processes cost improvement. It was counterproductive to our plan by losing a buy-in percentage because some stakeholders lost their sense of security, and it was also out of the scope regarding the change strategy. Although we spent a lot of time discussing the tactic of “Fire an Individual” till we reached the conclusion by voting not to use it in order to maintain the spirit of any stakeholder, we might have use it to fire a blocker to the required change.
Our successful implementation plan was based on 4 main aspects. First, formalizing a great team planning to facilitate decision-making. Second, Identifying the problem through walk the floor and being connected with the frontline staff. Third, mapping the stakeholders according to the their group of champions, helpers, bystanders, and resisters. Thus, facilitating the process of core change team members’ appointment to be more effective. Finally, communicating a clear mission and vision to all the staff across the different departments after creating sense of urgency to the need of the change.
