Perrier, an iconic brand in the world of mineral water, started to experience some problems the year after it great success of 1989. The previous year it had remarkably sold 1.2 billion bottles of mineral water, almost half to the population in the United States. The reason for their remarkable sale can be attributed to the absence of potential competitors in the market. The people had no choice, and therefore, they had to buy Perrier’s bottled water. However, in the year 1990, a minute quantity of benzene detected in the bottle reduced its sale by almost fifty percent (Case Study Problems at Perrier). The company had been facing bankruptcy when in 1992, Nestle, the world’s largest food company took over Perrier for $2.7 billion dollars (Case Study Problems at Perrier). The downfall of the company had already begun with a decrease by four hundred thousand in the number of bottles produced in a year by an employee. The relationship between the manager and the employee were unhealthy; and moreover, the company’s growth was further hampered by the CGT (workers union) who did not let Nestle cut their working force by fifteen percent Case Study Problems at Perrier.
A sense of resistance was felt among the employees in this case.
Resistance to change occurs when the individual interprets the change as a threat to himself.
Common causes of resistance can be listed as follows;
Misunderstanding is one of the most common reasons for employee resistance. Lack of understanding of the need for the change may also intensify resistance.
Fear is another major factor. The employees are usually scared of the change as they do not have an idea about what the change may bring with itself. Hence, they believe in standing still rather moving in a direction.
Poor Communication is another area where the managers are at fault. They need to inform the employees about the change and make them understand each and every detail about the change if they expect it to be accepted quickly.
The employees over a period of time develop their comfort zone and they never wish to come out of it. The change will force them to work out of their comfort zone. i.e.
The aspect of change implementation being viewed with resistance can be attributed to individual employees being cognitive dissonance. This reaction arises from people being uncomfortable with the impact that has on their beliefs (Rafferty, Jimmieson & Armenakis, 2012).
Lack of Involvement is another possibility. The employees were not consulted for their opinion about the change. They were not aware that Nestle was about to bring in the change, and as a result they showed resistance.
Unawareness about the rewards/benefits was also a problem identified. The employees were not aware about the rewards/benefits that they would receive when the change was implemented.
Q1. Identify the key elements of the resistance to change described in this situation.
Kotter and Schlesinger (2008) stated four approaches which can cause resistance among the employees, they are as follows: -
Parochial self – interest
Low tolerance to change
Misunderstanding
Different assessment
(Source: Kotter & Schlesinger, 2008).
In this case, three out of four seemed applicable, they are: -
Parochial self – interest: - Some people are concerned with the implication of the change for themselves and how it may affect their own interests rather than considering the effects for the success of the business. Jean – Paul – Franc has a different view on Nestle’s decision to cut the workforce by fifteen percent. He stated that the company could not do whatever it likes.
Misunderstanding: - There were communication problems among the employees and the managers, and as a result, the employees only received inadequate information. Due to lack of information, the management of the organization was not able to communicate it to the employees to ensure negligible resistance (they were not able to track the reason of decrease in annual productivity per employee annually).
A different assessment of the situation: - Some employees may disagree on the reason for the change and its benefits and drawbacks. Perrier’s employees did not see any benefits of the change in the organization; moreover, they were unaware of its benefits and drawbacks (Banhegyi, 2007, p.103).
Q2.Construct a change management strategy for dealing with this situation. In so doing, identify what approach (es) to managing resistance you recommend and provide a clear justification for your choice.
As suggested by Kotter and Schlesinger (1979), the following are the six strategies to manage resistance: -
Education and communication: - It is noticed that the employees show resistance due to their lack of knowledge about the change, and ones they are briefed on it, there will be a massive improvement in the rate of change acceptance.
Participation and Involvement: - Resistance mainly occurs when the employee develops a sense of exclusion from the organization, and as a result he does not accept anything new. Before introducing any change, the employees should be consulted and their ideas and suggestions should be listened and opted if the management likes it.
Facilitation and Support: - Anxiety and uncertainty also result in resistance from the employees i.e. they may find it difficult to adjust with. In such a case the managers should step forward and help the employees.
Negotiation and Agreement: - Some resistors may give up in their fight to resist whereas some may not, the managers perform negotiations i.e. provide them with incentives. This approach is useful only when the people resisting change are in power.
Manipulation and Cooperation: - When the other tactics come out to be too expensive or time-consuming, managers can cooperate with the resistors. This can be done by bringing the resister in the change effort i.e. giving him role in the process of decision making. It is more likely that the resistor would now accept the change.
Explicit and Implicit Coercion: - This approach should only be used when there is no other option available i.e. as a last resort. Management can force the employees to accept the change by explaining that resistance may attract hard methods like firing, transfer and no promotion.
Other methods to ensure that the change is accepted are as follows: -
Managers can provide the employees training and guidance beforehand: - The managers can inform the employees and give them proper training so that they would be ready and have an idea of what to expect. Doing do will decrease or finish the resistance that would have been faced if this step was not taken.
The management may select a few employees who are in favour of the change after the change had taken place, clear the doubts they have (if any) and ask them to educate the rest of the employees about the change.
Conclusion
Change is good for the organization as well as its employees. It enables them to move forward in a direction rather than standing still at a place. Resistance and change go hand – in – hand. It is better to face the problem of resistance rather than standing still at one place and not moving, there will one or the other employee who will resist it due to his own interests or discomfort. The managers have a crucial role to play to ensure each and every employee accept the change and start contributing towards its success and the methods by which this can be done has been discussed above.
In the case of Perrier, the employees were not ready to accept the change that was being bought by Nestle as they were unaware of it and were not able to understand the reason behind the upcoming change, as a result they showed resistance, ninety – three percent of the total number of employees belonged to the union and resisted the change that Nestle was trying to bring in order to improve Perrier’s financial performance.
This all happened because of the poor relation between the managers and the employees, they did not have proper communication as well was no sense of understanding, as an outcome, the company’s productivity decreased, had there been a proper relation maybe the problem would not have arisen in the first place. Attributing problems in the change process to “resistance” has the potential to cause managers to direct insufficient attention to the extent to which the quality of their own management practices is contributing to the problem. (Palmer, Dunford & Akin, 2007, p.178).
Bibliography
Banhegyi, E. (2007). The Art and Science of Change. STS Trust
Kotter, J. P & Schlesinger, L. A. (2008). Choosing Strategies for Change. Harvard Business Review. Retrieved from https://hbr.org/2008/07/choosing-strategies-for-change
Palmer, I., Dunford, R & Akin, G. (2017). Managing Organizational Change: A multilevel perspective. second edition.
Rafferty, A. E., Jimmieson, N. L & Armenakis, A. A. (2012). Change readiness: A multilevel Review. Journal of Management. Retrieved from http://jom.sagepub.com/content/39/1/110.full#sec-2>
