Dr. Kelly Nicholson
HRM 560 – Managing Organizational change
July 15, 2014
This assignment is to first, read the “Stories of Change” section in Chapter 1 of the textbook; Managing organizational change: A multiple perspectives approach (2nd ed.) by Ian Palmer, Richard Dunford, and Gib Akin (2009). The stories describe how companies such as Hewlett Packard, IBM, Kodak, and McDonald’s have addressed significant changes within their organizations. What follows will be a review that identifies three (3) significant errors, and the ramifications of those mistakes, made out of all of the change stories using the John P. Kotter model as described in Kotter, J. (2012) Leading change. In addition to identifying the errors, I will propose at least one recommendation for each change story that would have improved the effectiveness of the change process and explain why that recommendation would have altered the outcome of the change process. Lastly, I will attribute a change image to the leading managers of directors in each change story and provide an explanation as to why that change image is appropriate. I will also recommend a different strategy for managing change in each one of the change stories presented and provide a justification for my strategic recommendation. In the first story of change, the significant error made by the managers at Hewlett-Packard (HP) is failure to create a sufficiently powerful guiding coalition. The announcement of the merger with Compaq was done in September 2001 yet; in March 2002 the CEO Carly Fiorina and CFO Bob Wayman were struggling with having to convince Deutsche Bank that the merger is in the best interest of both organizations. Fiorina and Wayman had not taken the opportunity to convince the son of the co-founder of Hewlett-Packard, Walter Hewlett that the merger was in the best interest of the organization, and he had publicly opposed the merger, which required shareholders’ approval. Kotter (2012) explains that major change is said to be impossible unless the head of the organization is an active supporter. According to Palmer et al. (2009) shareholders’ managers, employees of both organizations and even Deutsche Bankers themselves were skeptical about the merits of the merger; even after they had advanced HP a $1 million contract to research the voting pattern of other organizations. Palmer and colleagues (2009) goes on to mention external pressures with doubts of the merger being expressed by a Merrill Lynch portfolio manager who was unsure of what the HP managers would do if the deal was rejected. It appears that there was no specific strategy that was made known by Fiorina and Wayman to assure all parties involved in the transaction of what their intensions were regarding expected outcomes as a result of the merger. Prior to the merger Fiorina had launched some organizational restructuring which were short lived because they did not address the customer’s needs effectively and uncovered how the operations were uncommunicative, thus leading to additional changes. Those changes led to employee resistance and eventually more bureaucracy instead of customer satisfaction. Therefore the ramification of the lack of failing to create a sufficiently powerful guiding coalition would have eventually resulted in the merger not going through, and the possibility of destroying the organization. One recommendation that Fiorina could have implemented that would have improved the effectiveness of the change process is to have created a team of individuals, shareholders, employees, and managers from HP, Compaq, and Deutsche Bank, as well as people from outside these organizations to work together strategically, to understand the value of the merger and to impart that to all involved. Had there been a coalition involved in the process from the beginning to the end there would not have been any need for the CEO Fiorina to at the last minute be...
References: Kotter, J. (2012). Leading change. Boston: Harvard Business School Press.
Palmer, I., Dunford, R., & Akin, G. (2009). Managing organizational change: A multiple perspectives approach (2nd ed.). New York: McGaw-Hill.
Stewart, G., L. & Browne, K. G. (2012). Human resource management (2nd ed.). Danvers, MA: John Wiley & Sons, Inc.
Winstein, K. J. (2007) Kodak swings to a profit as more sales shift to digital areas. The Wall Street Journal (Eastern Edition), August 3:A6.
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