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In the recorded history of mankind, the only thing that has remained constant is the tendency of change (Paton and McCalman 2008). Heffron (1968) mentions that "change is inevitable for individuals, organizations, and society, such as technology changes, values and attitudes change, goals and needs change, resource availability changes, laws change, political control of government changes" (p:152). Organizations are faced with an imperative demand for change.
In order to incorporate change towards betterment and success, change management is necessary. The management of change in organizations is a combination of managerial activities that set and install new values, norms, behaviors and attitudes, and processes within an organization that develops new ways of doing things and helps overcome potential resistance towards the change. Resistance is avoided by building consensus among the stakeholders for proposed change/changes and by incorporating customers' aspiration into the organization's output and which can exceed their expectancies in a better way. Change management involves planning; testing and implementing various transitional aspects of proceeding towards a new organizational structure or business process (Gai, 2003). It should be recognized that the difference in the organizational structure i.e. shapes, size configuration and value styles, necessitate different change management approaches.
Factors Promoting Change
Champy and Nohira identify three major drivers of change. They mentions that "there are three major drivers stirring organizational change faster than ever before are as follows: technology, government and globalization" (Champy and Nohria, 1996). Technology, increasingly forces organizations to re-structure their business operations and processes by providing newer and better ways of managing information. It also help creates new business models that were earlier not possible. The impact of technology can be understood within the context of Koberg framework of change which is developed on the previous work of Herbig. This framework identifies change as: "â€¦ procedural (management-determined innovations in rules and procedures); personnel related (innovations in selection and training policies, and in human resource management practices); process (new methods of production or manufacturing); and structural (modifications to equipment and facilities and new ways in which work units are structured)" Koberg et al. (2003: p.24), following Herbig (1994). Technology often brings about procedural, personal, process and structural change in organizations.
However, in the prevailing business environment, globalization is acknowledged as the most influential driver of change. It has forced many businesses, of different shapes, sizes, configurations, and values styles regardless of their host economies to reform their business operations and restructure their positions to thrive in a broader and less restricted market. (Dawson, 2003:114). Globalization proposes many challenges that require multi-faceted and complex strategies to deal with change rather than a single focus strategy. Globalization brings greater demands for innovation and creativity by reducing the life cycles of products, and higher needs for cutting price and providing better quality and more value by increasing competition. Therefore, it can be concluded that the extraneous factors initiate the drive for change, while the internal factors determine how and what type of change should be adapted to meet the demand of external forces.
Change Management Approaches
Management literature describes various ways of managing change. These ways can be categorized as continuous or episodic, planned or emergent, transactional, transformational, rational or chaotic, revolutionary or evolutionary, adoptive or adaptive change. All these change management approaches can be applied in relation to their extent and scope of dealing with developmental, transactional and transformational change (Ackerman, 1997). It should be noted that no single approach a right or wrong, as they effectiveness depends upon various internal and external factors that cannot be quantified easily. This part of the essay concentrates of the two popular approaches of managing changes i.e. planned and emergent and soft and hard systems approach approach according to the type of change and organizational context with example.
Planned and Emergent Approach
When the word 'management' is associated with 'change', it is very easily through of as a planned and deliberate process which come as a result of conscious reasoning and cognitive actions. It is often perceived as a rational outcome of an explicit cause and effect process. However, it is widely recognized that change often occurs in a spontaneous or emergent way. McGreevy provides a clear rationale for change management as an emergent rather than planned strategy. He mentions that "when managers make decisions that are apparently unrelated to the original intention they tend to be based on unspoken, and sometimes unconscious, assumptions about the organizations, its environment and the future (Mintzberg, 1990) and are, therefore, not as unrelated, as they may seem at first. Such implicit assumptions dictate the direction of seemingly disparate and unrelated decisions, thereby shaping the change process by 'drift' rather than 'design'. Such changes may reflect the unconscious scanning of the managerial landscape associated with changes in political and socio-economic environments, market conditions, competition, customer expectations and the impact of technology." This rationale for change management approach adheres to that emergent view of strategy development process first proposed by Mintzberg. Mintzberg proposed an emergent view of strategy development which does not see strategy as an essentially a linear and rational process. It is a process which does not have a defined set of objectives and main components prior to its commencement. However, it should be noted that Mintzberg acknowledges the merit in both planned and emergent approach of strategy development i.e. both the approaches can be merged to form a combination of strategy process and are not essentially mutually exclusive. He mentions that:
"The popular view sees the strategists as a planner or as a visionary; someone sitting on a pedestal dictating brilliant strategies for everyone else to implement. While recognizing the importance of thinking ahead and especially of the need for creative vision in this pedantic world, I wish to propose an additional view of the strategists- as a pattern recognizer, a learner if you will- who manages a process in which strategies and vision can emerge as well as deliberately conceived". (Mintzberg 1987)
Both these approaches can be combined in the strategy making process change management. These approaches can combine to work like a human brain which integrates both the intuitive and emotional right side and the rational and cognitive left side. Both these sides of the human brain are essential for a sound decision.
Soft or Hard Systems Approach
Perspectives drawn from the soft tradition of organizational theory described to be inspired by social sciences particularly sociology-inspired, views of organisations. They tend to emphasise the informal, the qualitative and the human aspects of organizations and change management approach. The soft system approach is often called the Human relations approach. Key adherents of this approach include Elton Mayo, Abraham Maslow, and Douglas McGregor. Unlike hard systems approach, it does not view organizations from a necessarily mechanical perspective. Soft systems approach has 3 main propositions; "People are emotional rather than economic rational beings: Human needs are far more diverse and complex than the one dimensional image that Taylor and his supporters conceded, People's emotional and social needs can have more influence on the work behaviour than financial incentives, and Organisations are co-operative, social systems rather than mechanical ones: People seek to meet their emotional needs through the formation of informal but influential workplace social groups" (Burnes 1996:47).
Application of Change Management Strategies and their effectiveness
This part of the essay presents the application of the aforementioned change management strategies and analyses them through a specific example. For the purpose of analysis, the beverage industry giant Coca-Cola Company has been chosen for evaluation. Currently the Coca-Cola Company is one of the largest companies and no 1 in cold beverage sector in the world. Coca-Cola has a very high brand equity. The company currently offers more than 400 brands and operates in more than 200 states around the world. It is said that Coca-Cola serves 1.6 billion servings each day (The Coca Cola Company 2008).
Through its history of establishment, Coca-Cola gained Â during the World War II. The company became more prolific amidst the war. Despite the uncertain economic and social conditions due to the war, Coca-Cola successfully attained a status of a patriotic symbol by offering free drinks to the American soldiers across the warzones. Therefore, the victory of United States and its allies brought intangible benefits to the company and opened a window of opportunity for the Coca-Cola Company to rigorously expand its operations by setting up franchises (Hitt el at 2007).
The nature of change can be either technical or people oriented. Technical change is merely mechanical such as component upgrade change. A hard systems approach for change management is applied under a reasonable plan for this type of change as it is considered to be a change in static, isolated environment. An appropriate change management methodology should adhere to Taylor's view of strategy development and therefore, should be mechanistic involving a certain amount of intellectual cognitive input. It should be basically prescribed, with clear quantitative objectives. On the other hand, change can be people oriented which is much more complex, with unclear objectives and time scales and dynamic environment. People oriented change management approach must incorporate the emotional aspect of people and adhere to the soft systems approach. Applying mechanistic methodologies for this type of change can often lead to failures. During the course of World War II, Coca Cola Company went through an imperative challenge of coping up with political and economical uncertainty and unfavorable business conditions. A people oriented approach for change management was required to respond to the fallout of war. At this time, instead of lying low, Coca-Cola became more active by providing free drinks to the US soldiers during the war. The company sought out to create a brand value and customer loyalty through an emergent approach. Its strategy to serve free drinks to American soldiers and its allies was without any quantifiable and planned performance indicators for change management. Through an emergent approach of change management, Coca-Cola capitalized upon the individual relationships and emotions of its consumers. The company successfully maintained its status and created an opportunity to penetrate new markets. It successfully became patriotic symbols which ultimately lead to a better brand equity and greater consumer loyalty. It paved its way for a post war expansion.
Therefore, it can be concluded that change management strategy is essentially not rational or linear and can be emergent and based on emotional aspects of consumers and employees. Changes that are not merely mechanical should be dealt with an emergent approach adhering to the soft systems model.