Strategic International Business Management And Change Management: A Case Study

Theories of Change Management

Dsicuss about the Strategic International Business Management.

Strategic International Business Management can be defined as the activities and plans which assist the commercial transactions between two companies operating in different countries. Many organizations deal with their international counterparts at some point in their value chain for accomplishing their goals of expanding internationally and earning revenues in the foreign currency. Since  the methods of doing the business in different vary from each other, proper understanding of the various aspects such as cultures, language, political and legal systems is essential for commercial success (Buckley & Ghauri,2015).

There are various aspects of Strategic International Business management . Change Management is one of them. For carrying out successful commercial operations in the present scenario, change management and transformation is necessary for the organizations to assimilate in their business activities. The companies face a lot of problems in implementing the change such as change fatigue .The personnel of the organization feel pressured in handling many changes at once (Sweeney & McFarlin, 2014).

Due to the failure of the companies to sustain these changes, companies face problems in handling the change initiatives. Cultural support is essential to cope up with the changes and implementing successful change management in the company.

So, in this report, which is about the case study of a company, SweDigi, operating in the digital music industry as a sub-contractor is facing severe downturns in its profits since the last 3 years. A new CEO, Mr. Jan is appointed whose aims are to turn the company in 12 months. His initiative is to introduce a new product range in the market. The management assumes that the products can be manufactured by introducing small changes in the production procedures. The staff and the managers of the company are reluctant to accept the changes and the risks faced by the company to produce the newly designed products.

So, in this report, the theories of change management and leadership  along with the methods to be introduced to launch the new product will be stated .Also, various suggestions to improve the situation will also be advised  to MR. Jan.

Change management can be defined as the methodologies adopted to prepare and assist the staff, managers and the organization as a whole to introduce the organizational change. It is redirection of the utilization of resources, business processes and other modes of operations which transform an organization (Aljohani, 2016).

Challenges Faced by SweDigi

Change management can help the company in reducing the resistance to change and encouraging the employees to involve them in the process of introducing change in the company. It also helps them in improving their capabilities. The change if directed in a positive way can help in reducing the cost of production of the company. It also helps in enhancing the innovation and advancing the technologies of the company, thereby helping it to achieve its goals and objectives. There are various types of changes viz. technological changes, strategic changes, tactical and leadership changes (Promes, 2016).

In introducing the change management, SweDigi is facing three major problems. Firstly there is a change fatigue amongst the personnel of the company. When the people are pressured to deal with multiple changes simultaneously, they feel exhausted and are not ready to handle the changes. They do not feel enthusiastic about the changes introduced by the company (Pieterse, Caniëls & Homan, 2012).

Secondly the companies lack in skills to implement the changes .They lack in applying the change principles and adapting the personnel deal with the changes.  With unrealistic targets, the companies are unable to comprehend and execute the change management process.

Thirdly, the changes are decided, planned and implemented by the higher management without involving the lower and the middle management. It is the lower and middle management who will execute the production process so their involvement is essential in the change management process.

The other problems faced by the management in introducing the changes are resistance among the employees for the new CEO. There is a disbelief and mistrust amongst them regarding the policies and the plans introduced by him regarding the new product initiative. They feel that their voice is not heard in the change management process and their leader fails to understand the problems confronted by them in manufacturing and marketing the product (Njuguna & Muathe ,2016).

Lack of communication is another problem which the management is facing to implement the change initiative. It is the failure of top management to communicate to the lower and the middle management about the occurrence of the changes. It results in change resistance and disagreement amongst the employees.

Lack of training and proper information about the changes is amongst the other problems which result in resistance to change amongst the employees. If the management initiates a new device or plan to perform a certain task, it should be well known to the employees in advance. They should be well accustomed with the new methods of performing the task (Luoma, 2015).

Solutions to the Challenges Faced by SweDigi

There are various theories of change management attributing to the introduction of change in SweDigi. One of them is The McKinsey 7-S model. Through assessing the seven aspects of the organization and their influence on each other, the management would be able to highlight the required changes to be introduced in the company. These are as follows:

1. Strategy: The strategy should be appropriate to allow the management to accomplish the goals and objectives of the organization. It should help the management to outperform the competitors of the company and should have the flexibility to adapt the changes without hampering the productivity of the personnel.
2. Structure: The structure should be appropriately designed so that changes can be well implemented (Ravanfar ,2015).
3. Systems: The core components of the organization such as HR, finance, document and team management and their utilization in the organization should be well analyzed to implement the required changes.
4. Shared Values: The core values of the company should be assessed to know how their strengthening would be of help in implementing the change.
5. Style: It is about assessing the management and leadership style followed by the company. Whether the present leadership styles are favorable for implementing the change or not is answered by this dimension of The McKinsey 7-S model.
6. Staff: Having a look at the staff list would help the management to answer question such as if there are certain gaps to be filled for executing the change management process.
7. Skills: It answers to the question regarding the possession of appropriate skills by the staff to perform their jobs as per the expectations of the management (Gökdeniz , Kartal & Kömürcü , 2017).

Introduced by Mr. Jeffery Hiatt, the ADKAR Change model focuses on the lower management to implement the change. By focusing on accomplishment of the five goals , it can be used to plan the appropriate changes on the personal and organizational level. These five goals are as follows:

1. Awareness: It creates awareness amongst the employees that there is a need for introducing change in the organization.
2. Desire: It enables to create a desire amongst the employees for implementing the change. It is done by promoting the benefits of the change amongst them (Shepherd et al., 2014).
3. Knowledge: It ensures that each and every employee in the organization is aware of the method adopted for implementing the change and their role in implementing it.
4. Ability: The capability of each employee should be checked and their need for gaining extra experience to complete the task should be assessed at this level (ChePa, Jasin & Bakar, 2017).

To overcome the resistance to change so that the new product can be launched, the leader must make the staff and employees understand about the reason for choosing a particular person for the post of CEO. It is important as sometimes the top managerial personnel do not accept the newly appointed individual as their leader and are reluctant to listen to and follow his views. As in this case, Mr. Jan is appointed as the new CEO as he has 10 years of experience in managing the affairs of his own company. If there is still dissatisfaction amongst the employees regarding the acceptance of their new leader, Mr. Jan should individually speak to the dissatisfied employees.

Secondly, communication gap should be bridged by establishing a good platform for communicating the changes and giving the employees a chance to ask the questions (Sylva & Amah, 2016).

Thirdly in order to implement the change management process smoothly and to launch the new product in the market, the cooperation of the employees can be gained by explaining the reason of introducing the new product process and a new plan of action.

Fourthly, involvement of the lower and middle management is necessary for implementing the change management process. Sometimes, the managers in the upper management fail to inform the employees about the changes thereby facing reluctance and anger from their side. They should be well informed about the changes and their views should be taken by the higher management so that they can make the change management process easier for the lower and middle management (Siddiqui, 2017).

Fifthly, if the staff has no idea about the transformation of the production process, they would not be able to accept the change. For implementing bigger changes in the company such as transformations in the production process, the changes should be communicated on the stage so that they accept the changes and involve in it gradually (Have et al., 2016).

Sixthly, training is an important element for introducing the change. The employees should be trained and equipped with the necessary skills to enable them to cope up with the change management process.

Seventhly, if the staff is responding to the transformations negatively, the management should analyze the problems confronted by the employees in coping up with the change. If there are defects in the model of change, then it should be modified immediately so that the change implement process can be executed properly (Calder, 2013).

Eighty, the company should be clear about the idea of the implementation of the change management process. The right way to implement the change is essential for the successful execution of the teams and the company.

Ninthly, after the implementation of the change management process, the managers should review the effects of the change continuously. An idea of change can be good on paper but it is not necessary that it works perfectly in practical. For example, if a change fails to consider the human element, then it cannot be successfully implemented in the company. The suggestions from the staff should be considered and contrasted with the implemented change. If they are facing problems regarding the change, then modifications should be done accordingly.

Finally, the change management approach requires transparency. The employees should be made aware regarding the reasons for change. Their problems should be acknowledged. Their queries should be resolved and explained the reasons for implementing the change.

Implementing the technologies can be a greatest problem for the workers as the management requires them to quickly adapt to the newly implemented technologies (Kazmi & Naarananoja, 2013).

Appropriate documents should be updated to align the change management process.  As the documents are the central to the processes, they should be well managed and documented to support the change management process.

Sometimes, managing multiple teams during the change management process can become a hurdle for its successful implementation. Thus the management should train the respective leaders regarding the changes implemented and skills and expertise required in the team members. This will lower their resistance for change as they would be comfortable to cope up with it. With the right solution, the management can easily identify which teams are affected by change and they can be either aligned or separated from the change management process as required (Briscoe,Schuler  & Tarique,2012).

The challenge to manage multiple and varying change can be resolved through harmonized process. Each and every controlled change should be traced, its impact should be analyzed and the changes should be effectively implemented. A simple system should be applied and email alerts should be kept to keep every employee on track to execute his or her part of the process (Bejinariu et al., 2017).

A centralized system should be established for viewing the progress of change and which phase of change the company is in. It can assist in making compliance driven decisions and minimize the risk in the organization.

The management should always keep a contingency plan to keep itself prepared for unforeseen events. The failures while implementing a new system, software or a modification of the process can be overcome by executing the emergency plan.

Implementing an automated system which automatically routes the task with automated approval with rules for overdue tasks and escalations can help to keep every employee on tack and successfully implement the change (Bucciarelli, 2015).

Also, when SweDigi wants to implement a new project regarding the introduction of a new product amongst the existing ones and the CEO have not received any recent update about the progress of the new project. He should immediately establish regular reporting frameworks to ensure that he is kept updated on the major activities, milestones to be achieved and the benefits delivered and the amount of budget which have been spent up to date.

Lastly, when there is mistrust among the staff and there is lack of commitment in the team members about the new project or the changes implemented, the management should conduct one-on-one discussion with the team members and bring them together to build shared goals and values. It should also change the team compositions and    hold the team responsible for the organizational values (Hao & Yazdanifard , 2015).

There are various theories of leadership which can be applied in the change management process:

1. Trait Theory: This theory believes that people are born or inherited with leadership qualities. The qualities of a good leader such as sense of accountability, intelligence, creativity are some of the values required in a good leader and people inherited with these qualities are eligible to be a leader.
2. Behavioral Theory: It focuses on the behavior of the leaders as contrary to their inherited qualities. So, it concludes that any individual who carry the traits of the leadership qualities in his personality can become a leader. Leaders are made not born (Halkias et al., 2017).
3. Contingency Theory: According to the contingency theory, there is no particular method of leading people. Every leadership style is based on certain elements and there are certain people who perform it at certain levels but they can perform at their minimum level of performance when the situations will be adverse. So, there is a contingency or condition associated with it that the leaders will more likely express their leadership when their followers respond positively.
4. Autocratic Leadership: It is focused on the leader. He is accountable and responsible for all activities and decisions .The leaders make decisions on their own without taking the suggestions from his subordinates. This kind of leadership has little or no flexibility (Saleem, 2015).
5. Democratic Leadership: In this kind of leadership style, the suggestions of the subordinates are considered in the decision making process. The leader holds the final responsibility but he or she allocates the responsibility to the subordinates.

In this kind of leadership, communication is active in both the directions-upwards and downwards.

1. Laissez-faire Leadership: In this kind of leadership, authority is given to the employees. The departments or subordinates are allowed to work without or little interference.
2. Transformational Leadership: It is about introducing changes in the company and within the teams. The leaders encourage the leaders to perform better by setting out more expectations .They empower the followers , so they tend to have more committed and satisfied followers.
3. Transactional Leadership: I this kind of leadership, in which the followers immediately get rewards for following their leader’s orders. It maintains the status quo of the leaders (Makaske, 2015).

The most effective form of leadership theory which can be implemented in SweDigi is Democratic Leadership.

Democratic leadership also known as participative or shared leadership is a kind of leadership style in which members take a participative role in the decision making process. Every member is given a chance to give their opinions and to participate in taking the decisions.  While this kind of leadership is focused on the free flow of ideas and group equality, the leaders are there to offer their guidance and control over their teams. It will surely lead to better contributions from the group members, higher productivity and increased group morale in SweDigi (Wahaba et al., 2016).

The sales, productivity and marketing of SweDigi can be improved by following Michael Porter’s Value Chain. A Value Chain is a execution of activities which the organization carries out to create value for its customers. So, by implementing this tool, the source of value can be understood by the companies.

Primary activities pertain directly to the manufacturing, sale, maintenance and support of a product or service. It consists of:

1. Inbound Logistics: These are activities related to procuring a product. It implies that the management of SweDigi should create healthy relationships with the suppliers.
2. Operations: These activities transform the inputs into outputs which are the sold to consumers. So, here the operational system of the company should be transformed to create value for the company.
3. Outbound Logistics: These activities supply the product to the end consumers. They include activities regarding collection, warehousing and distribution systems (Janithri, De Silva & Fernando, 2015).
4. Marketing and sales: These activities are used to convince the target consumers to buy the products of the company instead of its competitors. In SweDigi, this area must be transformed into the most powerful resource to create value for the company.
5. Service: It relates to the after sales service which helps in creating goodwill for the company (Alnawaiseh, Rawashdi & Alnawaiseh, 2014).

1. Procurement: It includes searching for the appropriate vendors and negotiating prices with them, in order to decrease the cost of production.
2. Human Resource Management: People are important source of value in the company. The business can create a competitive advantage with efficient HR practices.
3. Technological development: It relates to managing and processing data as well as safeguarding it from hacking and data loss. Thus, lowering the IT costs by adopting advance technologies can create value for the company.
4. Infrastructure: Support systems such as accounting, legal, administrative and general management are the infrastructures which the business can use to create value.

Thus the primary and support activities are the building blocks which SweDigi can use to create valuable products or services (Acharyulu, Subbaiah & Rao, 2015).

Conclusion

Thus, to conclude, for the successful enactment of change management principles and create value for its customers, the management of SweDigi should apply strategies such as efficient team management and clarity of vision for its employees and managerial personnel.

The employees should be directed towards a particular goal and they should be well communicated the vision. The leaders should understand the probable hurdles faced by their team members and attempt to resolve them. The most important element in the change management process is capturing a transition plan.

An efficient change management plan also considers the human elements of the organization. Change always needs people .They are required for evolving the goals and objectives of the company and for recognizing the need for change.

All the aspects of an effective change management plan needs the appropriate leadership style to direct all the resources of the company for the accomplishment of the goals and objectives of the company. So, if SweDigi wants to establish itself in the market, it has to implement the appropriate change management principles under the guidance of effective leadership.

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