Abstract
Timely and successful change represents a crucial aspect of an organization’s evolution, given continuous changes in external environment and ever intensifying competition at the market. This paper focuses on the scope of change, required for Simmons company, and its implementation. It is envisaged that the change would increase the company’s revenues, leading to an enhancement of its competitive advantage. The rationale for change is justified by the references to empirical research, undertaken within the organizational settings. The paper starts with the problem statement that diagnoses the current state of Simmons corporation. The analysis of the case study demonstrated that the major challenges, faced by Simmons, deal with the lack of employee commitment and the negative consequences of financial crisis 2007/2008. It is suggested to counter the above issues with the help of the modernized HR development strategy, because employee loyalty is an essential prerequisite for performance improvement. Then, the plans for the implementation and evaluation of change are discussed.
Managing people assessment: what should Eitel do?
Problem statement
The following study focuses on the case of change to be conducted at Simmons Corporation. The history of this enterprise dates back to the late 19th century, when Mr. Zalmon G.Simmons created wooden insulators and specially designed boxes of cheese. Since that time the company significantly broadened the range of products and services on offer and conducted multiple changes. Given the logics of change management, it is suggested that the discussion of the current change includes a number of steps, such as the issue (problem statement), the introduction of change and its justification, as well as the implementation plan and the evaluation of change.
The analysis of the case “Leading change at Simmons” allows distinguishing three most important challenges that are faced by the company. Foremost, the financial crisis of 2007/2008 (frequently compared to the Great Depression in terms of its severity and consequences for business) significantly limited the company’s financial capabilities and made shareholders highly suspicious as regards the change-related initiatives in the company (Egan, 2014). Secondly, the company’s plants fail to cooperate, getting engaged into unnecessary competition. In turn, employees lack the commitment to common goals, loyalty and communication.
Scope of change
Given the rapidly changing external environment and ever increasing competition pressures, change becomes one of the most topical dimensions of the management theory. According to Beer&Nohria (2010), both economic value and organizational capabilities are to be taken into account, when the scope of required change is singled out. To combine existing theories of change, Beer&Nohria (2010) advise to combine setting direction from the top and getting people engaged from below. Moreover, the results of empirical research prove that the implementation of change is significantly alleviated in cases when employees are involved into diagnosing the state of an organization and discussing the scope of change. The methods of employee involvement include common discussions related to change, establishing the working groups on different aspects of change, creating web-platforms for developing the common model for change etc (Ernst&Young, 2014).
As it was already mentioned in the problem statement section, Simmons Company currently suffers from a range of issues. While the 2007/2008 financial crisis is an external factor that weakens the organization, the lack of coordination across the company’s plants and culture- and commitment-related challenges are deteriorating the corporation from inside.
In this light, the main question that is posed in the case study is whether it is worth continuing and spreading the Great Game of Life (GGOL) HR development program that was already successfully tested at one of the company’s plants called Charlotte. The key argument for the continuation of the program deals with its success at Charlotte plant, leading to significant improvement of the plant’s performance. On the other hand, the program is costly, and investors may be skeptical about continuing it due to the implications of the financial crisis.
The suggested change is to preserve the concept of the GGOL, modernize it according to the analysis of Charlotte plant case and apply it to all the plants of the company.
The rationale for the change includes several important factors.
According to the results of the research by Beer&Nohria (2010) and Markos & Sridevi (2010) participating in designing organizational change has positive impact on the way the change is conducted and has a potential to unite employees around the common challenges and goals. As the GGOL is to great extent concerned with involving management and employees of the company into the process of creating a vision for the future of the company and the related goal-setting process, its further implementation is crucial for the success of other changes, planned by Eitel.
Helping to unite the management and employees of Simmons around common ideas and goals, the program facilitates employee commitment and loyalty. According to the research by Lencioni (2002), employee commitment exerts positive impact on result orientation and accountability in a company.
Furthermore, many research works suggest that there is a strong relationship between a degree of employee commitment and his/her performance at the workplace (Iqbal et al., 2015) (Wharton, 2012). It is also not worth forgetting that HR development programs constitute an important part of organizational culture that is also proved to exert significant impact on employees’ performance rates (Habib et al, 2015). Therefore, facilitating an increase in employee commitment and the development of unique organizational culture meansthat a company applies efforts to improve employees’ performance and enhance competitive advantage.
Moreover, human resource development shall be an essential part of any company’s strategic vision. HR development projects help to unveil employees’ potential, so that new ideas for a company’s development and organization of labour can be introduced. HR development also helps a company avoid employee turnover and ensure employees’ being interested in growing within the company.
The implementation plan
The implementation of change shall include a range of steps, such as an analysis of Charlotte case and modernizing the GGOL program; applying the improved program at one plant; analyzing the impact and adjusting the program, as well as making the program function at all the plants. The analysis of Charlotte case and improvement of the GGOL program shall take no more than two months. Then, a year is required to test a program at another plant, different from Charlotte. The second analytic phase can be completed over another two-month period. Finally, another year is required to conduct the HR development program across the whole company.
Ensuring that the implementation plan works requires the application of several strategies. First of all, the planned change is to be communicated to all the interested stakeholders, such as the company’s staff, middle management and shareholders. The members of each group of stakeholders need to be convinced that a change will be beneficial for them (Cushman&King, 1995, p.4).
Secondly, conducting a massive change that involves different categories of staff and management requires strong leadership, enjoying clearly defined roles and accountability. It is suggested to hire an external independent change manager, who will assist the organization, when specifying the scope of change, communicating it to employees and management, as well as monitoring the implementation of the suggested change.
There is a range of obstacles that can prevent Simmons from applying its highly innovative GGOL program at all the plants of the company. Financial issues can harm the implementation of the plan in two major dimensions. Firstly, the company may really lack funds that are required to ensure the operation of the GGOL program.
Secondly, investors may be reluctant to provide funding for the GGOL program, despite the benefits that the program is expected to generate in the future. Given the severity of the financial crisis, it may be hard to persuade investors that HR development is an essential direction for the change and improvement at Simmons. Finally, middle management and employees can refuse from participating in the GGOL program. Such risk may stem from the improper promotion of the program and the program’s being associated with ‘brainwashing’ (as it already happened, when the GGOL was just introduced). Quality communication of change will serve as a crucial prerequisite for avoiding and alleviating the above challenges.
Evaluation
Conducting high-quality organizational change program (including HR development initiatives) requires thorough monitoring and multi-stage evaluation. In case of the change to be conducted at Simmons the evaluation will take place several times. Firstly, the company will apply efforts to evaluate the quality of change that was conducted via the GGOL program at Simmons’ Charlotte plant. The evaluation will be followed by the development of recommendations regarding the modernization of the GGOL program and increasing its efficiency. Secondly, the evaluation will be conducted after the modernized program is implemented at the Simmons’ plant, different from Charlotte. This evaluation will be followed by further adjusting of the program. Finally, the evaluation will be implemented following the realization of all the events, envisaged by the change plan.
The evaluation will be based on several types of data. Firstly, specific surveys will be created to find out whether the participation in the program was of use for employees. For these purposes it is suggested using Kirkpatrick’s four-level training evaluation model that allows considering training participants’ reaction, learning, behaviours and the overall training’s results [MindTools Editorial Team, 2015]. Measuring the results of the training tackles the outcomes the conduct of the training had for an organization as a whole. Secondly, the evaluation of the GGOL impact on employee satisfaction, employee performance, the level of Simmons’ revenue and the company’s competitive advantage will be conducted, based on the objective data, such as the results of annual financial analysis.
References
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Mind Tools Editorial Team, 2015. Kirkpatrick’s four-level training evaluation model [online] MindTools. Available at: < https://www.mindtools.com/pages/article/kirkpatrick.htm> [Accessed 10 May 2016]
Wharton, 2012. Declining employee loyalty: a casualty of the new workplace. [online]Wharton. University of Pennsylvania. Available at: < http://knowledge.wharton.upenn.edu/article/declining-employee-loyalty-a-casualty-of-the-new-workplace/> [Accessed 12 May 2016]
