Creating change in any organization might seem like an insurmountable task given that human beings are usually resistant to change. But is that really true? A lot of employees, as normal workers, in middle and upper management actually embrace change if only they can be convinced of its validity and the manner in which it affects their best interests in a positive manner. No one likes to change anything that seems to working perfectly, right?
That's what the employees of the bottled mineral-water company Perrier have been struggling to cope with for a number of years after the organization was bought over by Nestle in 1992. Of course, there was a time when Perrier sold half its mineral water to people in the United States and made hefty profits as a result (Palmer, Dunford & Buchanan, 2008). Everything went well until traces of benzene were found in a bottle and which led to a serious drop in sales – especially thanks to their clientele from the United States who were perhaps very careful with their health. Despite this, Nestle thought that Perrier is still the world's best mineral water brand and which resulted in a takeover but what they were to discover later was that the company was having problems internally that greatly affected its output. The problem: while an average Perrier worker prepares approximately 600,000 bottles of water a year, their counterparts at Vittel & Contrex prepare almost double that figure in the same span of time.
So, why has Perrier productivity fallen so low, especially from where it was in the 1980s? Was the benzene trace ultimately the cause of its downfall? Or is it because of bad management that cannot convince its workers to increase their productivity? Or both? Why do the workers resist change to the point that they are producing much lesser number of bottles than others? Are there any recommendations that can restore the company’s former glory? Or are its best days well behind it now?
But before we discuss how change management can remedy this situation, let’s try and ascertain why Perrier has opted for such a disastrous stance when it comes to production quality and output in these competitive times. Is cutting 15 percent of its workforce the answer to improving profitability? Should the workers disassociate themselves from CGT so as to improve their chances of restoring Perrier back to its profitable ways? Could the management improve and communicate change in a much better fashion?
Some of the causes of resistance to change that seem to apply to the Perrier situation is that any changes are clearly not in their best interests apart from being contrary to the company culture or how things are done at Perrier. Nestle is not a French brand, after all. More than anything, employees definitely lack that conviction that suggests that any change is required. What one can clearly see is that the way change is being advocated by Nestle has become a point of contention between the world's biggest food company as well as Perrier and which has probably led to the former blaming the CGT for their production woes. Not very differently, workers, who don't trust the management, find proposed changes not suitable for their company's situation. There's plenty of evidence from the case study to suggest that both passive and active resistance to change is afoot at this point and which has led to procrastination as well as the blame game. Without a doubt, this is disastrous to the company’s survival, if Perrier must survive in this day and age (Palmer, Dunford & Buchanan, 2008).
Not only does the CGT oppose the need for an overhaul suggested by Nestle but ignores any kind of competition that threatens to put Perrier out of business. Much like the situation where mineral water bottles of Badoit Rouge were placed in the factory cafeteria to remind employees of the danger of their competitors overtaking them, in terms of market share. Of course, there were strong reactions to this that was read as a provocation. Without a doubt, this move seemed a bit underhanded. This only translates to more resistance to making changes since employees don't find increasing production necessary or appropriate. In addition, what it also reveals is that with past changes not being so successful by Nestle, there's very little need for any changes now. No matter whether people will lose their jobs, the employees lack the conviction that increasing productivity will improve their lot. In fact, one of them continues to maintain that the water and the gas belong to this region of France and they will probably find some other way to sell the mineral water (Palmer, Dunford & Buchanan, 2008).
So, how does one suggest change that will be acceptable in this situation where both sides are blaming each other while not taking responsibility for change that is very necessary here?
Since any change – much like placing the bottles of their competitors in the factory cafeteria – is frowned upon, a more subtle approach seems necessary. Any similar actions in the future are a clear no-no. Unfortunately, it isn't surprising why this approach did not work since it only invoked fear in the employees more than anything else. If anything, the subtle approach could involve the key influencers in the organization who are kept abreast of changes in an educational and non-threatening manner, much like what Bill Bratton did with the police departments in both Boston and New York. What is also unfortunate is that there's no talk of how these changes will benefit the Perrier employees – one aspect that Nestle must cover with specifics instead of arm twisting the union that only seeks to protects its employees (Palmer, Dunford & Buchanan, 2008).
Having said that, not all resistance to change is negative. One can clearly see how inappropriate Nestle's stance is in increasing productivity without listening to the Perrier employees for a product that has its own niche. If anything, avoiding the element of surprise, in terms of firing employees or placing competitors' water bottles in the cafeteria will do little to gain compliance from the Perrier employees too. Being open about the need for more productivity while gaining consensus through getting all employees to participate in the discussion is a much better approach (Palmer, Dunford & Buchanan, 2008).
Last but not the least, it is vital that any big change that is being made at Perrier should be broken up into smaller changes that will attract less criticism, cynicism or apathy from employees who have had bad experiences in the past with the Nestle management. It's difficult but with patience and time and with working on building trust with the Perrier employees, things can be turned around to Nestle's satisfaction. Actions that involve manipulation or coercion will only exacerbate the problem and deepen the divide between the management and employees, much to the detriment of both sides (Palmer, Dunford & Buchanan, 2008). This, in turn, will cause irreversible damage to both Nestle as well as Perrier’s employees, in terms of their business relationship as well as overall profitability in the future.
References
Palmer, I., Dunford, R. & Buchanan, D A. (2008). Managing Organizational Change: A Multiple Perspectives Approach (2nd ed.). New York, NY: McGraw Hill Education.
