Discuss critically the way a change in an organisation has been or is being managed/led. You will need to identify a suitable organisation. Consider, with supporting arguments, whether an alternative approach might have been more effective?
Today’s business environment is dynamic and changes are a constant part of the business. These change initiatives are time consuming and are often costly. The significance of change management lies in the fact that it impacts the organizations drive towards success (McLean Bourda, 2015). Change is unavoidable and organizations need to manage and resolve issues to sustain the change. Organizational change management includes a number of processes and tools which are applied to manage the issues that arise due to the changes. This issues include culture shocks, change in patterns, new policies etc. The activities include detecting and diagnosing the problems and help in resolving the issue and the transitions so as to make the people realize the organizational goals and direct the organization towards success (Beerel, 2009).
The Company in discussion is Nokia Corporation. Since 1990s this Finnish company was the mobile market leader, but the company suffered a major setback in the recent scenario giving away to Samsung and Apple. Thus company is striving to gain its position with its windows Phone platform. There had been some major issues like stakeholders resistance which are handled and thus it is discussed in the report.
The change for Nokia was dramatic it changed from a limber company to an IT company selling mobile phones. During the third quarter of 2007 the Nokia’s market share was 48.7 percent but in the third quarter of 2013 the market share dropped to a low 3.5 percent. The huge strategic changes were owing to the factors like rise of a touch based smartphones and a large market disruption brought by the Apple iPhone with HD screens and supports mutli touch gestures which have raised the bar for the industry to follow (McCray, Gonzalez and Darling, 2011). Nokia tried to follow but the features were not of a comparable quality (Harakka, Korhonen and Honkasalo, 2004).
Other difficulties that were faced are the fact that Nokia was unsuccessful in bringing great innovations. This was subject to the bureaucracy in the organization. A bloating management layers and complicated organizational structure had caused delays in the decision making process. Also the Symbian team has a better bargaining power and control over the resources inside the company than the other teams and hence other teams lacked in resources to create and launch innovative product lines. The symbian team and few other stakeholders saw this as a threat and hence did not help in letting the company make a breakthrough in the product line.
The New CEO Elop felt that Nokia was on a “Burning Platform” where the fire is the iOS and the Android market. He blamed the poor attitude and resistance of Nokia’s employees for the downturn and suggested a change in behavior.
Elop announced that Nokia is in partnership with Microsoft and will devote itself to launching Windows base phones only. The Symbian products were faded out. The MeeGo device was also shelved for the high end market. The employees and stakeholders were shocked that all investments on this are now given up (Nokia, 2015).
The employees protested to the announcements and rallied. They were in disagreement with the CEO about discarding the MeeGo from mainstream platform and thus a wave of resignation ensued. Also the CEO was the first non Finnish CEO and there was a huge cultural difference in the way everything worked which lead to difference in attitudes (Pal and Pantaleo, 2005).
The sudden abandment of symbian platform were not accepted by the supporters of Nokia. Even the network operators were doubtful of the Windows platform. They felt the heavy rely on Skype would put their business to risk. The shareholders were also shocked by the decision and the share price dropped by 10 % immediately after the announcement.
Intel, the strategic partner of Nokia felt that the decision was wrong and android was a better option. The software developers felt that the new strategy would be the reason for Nokia’s downfall.
The Kubler-Ross Grief Model is utilized to discuss the resistance to change (Biech, 2007).
Shock- many customers, software developers and employees were shocked due to the strategy change of adapting to only Windows Phone and closing curtains on the Symbian.
Denial- many employees and customers did not believe the announcements and considered it as a rumor, thus a lot of questions were asked and clarifications continued.
Anger- the employees walked out of office, low share price and the criticism of CEO as a “Trojan Horse” tarnished the company image
Bargaining- users wanted to transfer their applications in the Symbian to Windows format. The N9 was unavailable was available in many countries thus leading to either anger or depression in the clients.
Depression- many consumers and software developers felt that they would not gain much from the windows platform and the bargaining did not work hence they switched to other brands.
Testing- when the Lumia 800 and 710 were launched people were quite curious about the product and seek to find out more. It was confirmed as the term “Lumia” was quite searched (Nokia down on networks; but up on handsets, 2001).
Acceptance- finally the fluidity of the Operating system and the superior camera and battery power were accepted by the Nokia supporters. There were also some brand switchers who chose Lumia over Iphone and Android.
The ADKAR Model is needed to understand the need for change and implementing it (Henry and Mayle, 2002)
Awareness- of the need for change was shown by the CEO of Nokia who studied the facts that put Nokia into crisis.
Desire- the CEO took the decision of supporting a change so that the company resurfaces in the mobile market with a new platform to compete with big shots like Samsung and Apple.
Knowledge- there must be idea from where resistance could be faced and the one initiating change must be keeping track of the resistances which Nokia did and strategized on the very bases of resistance,
Ability- it is the skill required to manage the outbursts and still enforces the changes which was very efficiently shown by the company as it did not melt away into pressures.
Reinforcements- it is needed to sustain the change, and Nokia continues take innovations in stride with the Windows platform and marketing it to the world.
The theories of change are the building blocks for attaining long term models. The recommendation on alternative change Models for Nokia could have had better response from all quarters.
Step 1- Establishing a sense of urgency by helping everyone to see the need for a change and convincing them of its importance (Gilliland and James, n.d.).
Step 2- Guiding coalition by grouping powerful people in the organization who will encourage the other employees to actively take part in the change.
Step 3- Developing a new vision to direct change and forming strategies to achieve the vision,
Step 4- Communicating the changes in a gradual manner so that as many people as possible could understand the message and accept it.
Step 5- Removing obstacles and resistances by encouraging broad bases action like risk taking and introducing nontraditional ideas.
Step 6- Generating short term goals, which would be visible by the employees and the market alike and rewarding of the employees who were involved.
Step 7- Using increased amount of change drives by hiring and promoting employees with a vision, changing policies and structures to suit with the changes, introducing new changes in themes and projects.
Step 8- Incorporating the changes into the organizational and market culture by promoting new ideas and connections.
The other alternative theory which could have better managed the Nokia Organizational change is (Baker, 2007).
Unfreeze- The organization should be prepared to accept the necessary changes. The existing status quo has to be broken in order to develop new operating systems. Compelling messages are also to be communicated to all the relevant stakeholders so that they understand the scenario. The organizational beliefs are to be questioned for their productivity and uncertainty has to be considered as a pro.
Change- The people look beyond the doubts and embraces new ways and systems, a new goal and vision is provided. Time is given to the people to understand and direct themselves to the new strategies and objectives. Also it has to be realized by the organization that everyone would not be convinced and will not support the change.
Refreeze- The changes will slowly take a firm ground and get a shape. A stable organization structure is reformed with new job descriptions. The changes are incorporated into the business culture. The efforts of the people involved are recognized so that they believe in future changes. Finally celebrating the success of the change will close the issue.
Conclusion
Nokia was the leading manufacturer of mobile handsets and still continues to hold its strong presence in the market with the Windows platform. The new Lumia range is perceived as innovative, challenging and savvy in the international market (Fourtane, 2015). The company is yet to revive its old position as there is a market domination fight between Samsung and Apple both challenging with new innovations, yet Nokia have come a long way since its downfall. The change in the organization was hard to maintain but the company have recovered with well managed steps but the Company heads could have taken alternative approaches to handle the situation and it would have taken less time to handle the crisis. Nokia thus should take innovative marketing strategies to regain its old position.
References
Baker, D. (2007). Strategic change management in public sector organisations. Oxford: Chandos.
Beerel, A. (2009). Leadership and change management. Los Angeles: SAGE.
Biech, E. (2007). Thriving through change. Alexandria, VA: ASTD Press.
Fourtane, S. (2015). Supply chain agility: Nokia’s supply chain management success. [online] EDN. Available at: https://www.edn.com/electronics-blogs/supply-chain-reaction/4430478/Supply-chain-agility–Nokia-s-supply-chain-management-success [Accessed 11 Jul. 2015].
Gilliland, B. and James, R. (n.d.). Crisis intervention strategies.
Harakka, T., Korhonen, R. and Honkasalo, L. (2004). The Nokia Generation Hangs Up. Foreign Policy, (143), p.78.
Henry, J. and Mayle, D. (2002). Managing innovation and change. Milton Keynes, U.K.: Open University Business School.
McCray, J., Gonzalez, J. and Darling, J. (2011). Crisis management in smart phones: the case of Nokia vs Apple. European Business Review, 23(3), pp.240-255.
McLean Bourda, F. (2015). Change Management Theories and Methodologies. [online] www.tcs.com. Available at: https://www.tcs.com/SiteCollectionDocuments/White%20Papers/EntSol-Whitepaper-Change-Management-Theories-Methodologies-0213-1.pdf [Accessed 11 Jul. 2015].
Nokia down on networks; but up on handsets. (2001). III-Vs Review, 14(8), p.6.
Nokia, (2015). Nokia Capital Markets Day 2014. [online] Available at: https://company.nokia.com/en/news/press-releases/2014/11/14/nokia-capital-markets-day-2014 [Accessed 11 Jul. 2015].
Pal, N. and Pantaleo, D. (2005). The agile enterprise. New York: Springer.
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