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Change is now driven by global orientation, scientific inventions and important discoveries. The economics of globalization dominates the political and corporate philosophy. The shadow side of globalization, exploitation, terrorism, refugees are at equally alarming pace. All these internal and external factors lead organisations to change inevitably in response to the revolution.
Change Management at Selfridges & Co:
"Selfridge was a man ahead of his time, an accelerator of change."
-Shopping, Seduction and Mr Selfridge by Lindy Wood- head
Selfridges & Co has been through rise and dramatic fall, but we find an enthralling description of their capability to manage change in case studies done on the organization. This response to change is thus the organizations most powerful tool against its competitors. The pace of the change and invention outpaces the ability to keep up with the old strategies, efficient at a certain point of time.
To demonstrate my assignment in the view of the assessment criteria efficiently, I have chosen prestigious organisation Selfridges & Co. In this assignment I will bring about change in two areas, justifying my decision with forces driving the change, the stipulation of the mentioned change in Selfridges & Co development, introducing systems for involving stakeholders and finally developing appropriate models for implementation process.
Background to Change Affecting the Selfridges & Co
Background to Change in today's Economy:
In the new economy, information, education, and motivation are everything."
"Three Forces Driving the New Economy
1. Knowledge - intellectual capital as a strategic factor; a set of understandings used by people to make decisions or take actions that are important to the company
2. Change - Reduces predictability -unremitting, brisk and complex.
3. Globalization - technology, production, trade, finance, communication and information, this has resulted in opening of economies, global hyper competition and interdependency of business
In 150 years of frenzied transition period to a new age distinct by global competition, furious change, faster flow of information and communication, increasing business density, and pervasive globalization, Selfridges & Co has been very creative and innovative and has coped up with the altering demands in all aspects.
Globalization has taken the Selfridges & Co. from national fame to international glory; a diverse customer loyalty is attributed to the organisation.
But, I have noticed the only modification it has made in its trade mark "Yellow Bag" in 150 years is turning its shopping bags from plastic to paper.
According to Selfridges & Co surveys highest percentage of their loyal shoppers is of Arabs, they are very keen to augment for this target sector. Majority of Arabs are Muslims, one of the essential requirement of this target group is Halal food. This calls for change to cater a vast clientele.
The external factors of globalisation, changes in the market, customers, competitors, social, political and natural environment call for the Internal changes that will facilitate Selfridges & Co to react and adapts to the external changes.
I call for change in two areas of my organization.
Change #1 Modify the trade mark yellow paper bags of the organization.
Change# 2 Introduce Halal foods in the restaurant.
Reason of Change #1: Recently the National Geographic Store has opened its first store in Europe. It is situated in Regent Street the Yellow Border Design, Flag Design and Society Seal are trademarks of the National Geographic. The colour and design of the store paper bags are almost identical to Selfridges & Co.
I believe that the change in the design of Selfridges & Co will differentiate it from its potential major competitor as well as break the monotony.
Reason of Change #2: Introduction of Halal food will be beneficial to the perishables sale. The history of the organization indicates that it built client age by giving out "free pudding". Dining experience of Selfridges & Co is one of the most popular attractions, Introducing Halal food will add to the number of consumers.
Strength and Weaknesses of Bureaucratic Organizations:
Bureaucracy is a concept in sociology and political science referring to the way that the administrative execution and enforcement of legal rules are socially organized.More or less every organization is bureaucratic in nature. Most large organizations are bureaucracies. My chosen organization Selfridges & Co can best relate to a learning organization, but we do witness a strong bureaucratic manner in certain departments like payroll department.
General Strengths and Weaknesses of any Bureaucratic Organization:
Strengths: More control and monitoring of upper levelÂ management which leads to the results being more dependent on the top management decisions. The employees have a clear perceptive of rules and regulations as well as reporting relationships are definite. Due to centralized system and standardization all the employees follow the same procedure and it is easier to monitor. Parallel flow of information leads to efficiency.
Weaknesses: Human and social processes are neglected. Fixed tasks and strong control discourages innovation and creativity thus HR can't be utilized in the fullest manner. Inefficient top management can lead to disaster, because more control of top management, this creeps a sense of ownership lack in the employees so employee participation and involvement does not exist. Communication gets distorted as it goes through many levels in the hierarchy. All processes including decision making is very dawdling.
The bureaucracy itself encourages political behaviour and people try to use other means to go up the hierarchy.
Merits & Demerits of a Bureaucratic Organization Related to Selfridges & Co.
Strong control and monitoring escorts to fewer chances of errors.
Experts formulate imperative decisions based on their skills and experiences that are beneficial to the organization.
Standardization directs all employees to track a uniform course of action.
Horizontal flow of information results in efficiency.
Miscalculation of the top management can lead to failure.
The bureaucratic system practicing certain department in my organization has a tendency of ignoring human and social processes at times.
Alternative Forms of Organizational Development:
Organizational Development (OD):
One of the most significant possessions for an organization is the ability to cope with change.
In the book "Becoming an OD Practitioner" the author Neilsen has presented a new definition of Organizational Development. He states that OD encourages the people involved in the system to be more articulate about their views and experiences within the organization. Neilsen expects members to be more responsible for their actions as a part of the organization.
The hypothesis behind OD is that when people pursue both of these objectives concurrently, new ways of working together are revealed, which will be more favourable in achieving their own and their shared (organizational) goals. If the desired outcome is not achieved the activity helps them to comprehend why? This reflecting will aid to make meaningful choices about what to do in light of this perceptive. (1984, pp. 2-3)
Alternative Forms of Organizational Development and there Relevance with Selfridges & Co
Following are some of the alternative forms of organizational development:
Business Process Re-Engineering (BPR):
Michael Hammer and James Champy wrote the bestselling book, "Reengineering the Corporation". The idea promoted is of a radical redesign and reorganization of an enterprise, they argued that sometimes it is indispensable to lower costs and increase quality of service. According to them the key to a radical change is IT.
Seven principles of reengineering to modernize the work process were presented by the gentlemen.
Organize around outcomes, not tasks.
Identification of organizations process and rearranging them giving priority to urgency.
Giving centralized position to geographically scattered resources
Making a connection among similar activities at organization.
Confine information once and at the source.
BPR gained the reputation of being a polite alternative to the word "downsizing". The management abandoned the concept of BPR, according to Hammer, lack of unremitting management commitment and leadership, unrealistic scope and prospect, and resistance being the prime reasons.
Selfridges & Co is not practicing this form of organizational development in any of its departments.
Total Quality Management (TQM):
The concept of TQM has been inspired by the need for organisations to substantiate with regard to quality levels. It was essential to formulate a process due to increased demand by customers and suppliers for higher quality products.
TQM processes are sequenced in to four categories:
--- Plan --- Do --- Check --- Act----
Quality must be addressed at all levels of an organisation is the basic principle behind this concept, from the top to bottom. Application of theories and approaches are made by the management to improve quality and decrease organisational costs and to maintain a process of continuous improvement at the same time. Although the prime emphasis is on quality, but keen interest in people and their involvement, particularly with regard to suppliers and customers is taken during the process.
Principles of TQM:
Committed and effective leaders
Selfridges and Co departments have adapted Total Quality Management successfully. Quality is one of the prime attributes of my organization; from exuberant leaders to trained proficient workforce Selfridges & Co has successfully implemented the principles of the strategy.
Kaizen comes from the Japanese words æ”¹ ("kai") meaning "change" or "to correct" and å-„ ("zen") which means "good", philosophy is to
"Do it better, make it better, and improve it even if it isn't broken, because if we don't, we can't compete with those who do".
In this business strategy the goal is to work together, individuals from across the organisation are encouraged to give improvement suggestions on regular basis, while reducing waste Kaizen is based on making little changes on a regular basis and it involves setting standards and then continually improving those standards. To achieve those standards it provides the training, materials and supervision that is essential for employees to achieve the higher standards and sustain their capacity to meet those standards on an on-going basis.
Selfridges & Co has been in the process of continuous improvement for the past 150 years and identifies with the Kaizen philosophy.
Push and Pull Strategies:
The communication between seller and buyer is an example to understand the push strategy. Promotions made by television or radio, do not allow the buyer to interact. While, if phone or internet is used as a communicating medium, the interaction between buyer and seller is probable.
Promotion made using television and newspaper as medium the information is pushed, on the other hand mediums like telephone and internet allow the buyer to demand information as he requires.
In a "pull" system product has to be requested by the consumer. Car manufacturing company Ford Australia is a fine example of" pull" system, Ford Australia only produces cars when an order is placed by the customer.
We find a number of departments in Selfridges and Co applying the push and pull strategies. Both forms push strategies can be witnessed in the form of Selfridges famous visual displays. Custom made products by many designers concessions in the store are genuine examples of pull strategy.
"Organizations where people continually expand their capacity to create the results they truly desire, where new and expansive patterns of thinking are nurtured, where collective aspiration is set free, and where people are continually learning to learn together."
Selfridges & Co can best relate to a learning organization as it is largely based on this philosophy.
In nature organizations are not learning organizations they develop into it where factors prompting their change. To create a competitive advantage, companies need to learn more rapidly than their competitors and to develop a customer responsive culture.
This requires co-operation between individuals and groups, free and reliable communication, and a culture of trust, the main benefits are;
Maintaining levels of innovation and remaining competitive
Being better placed to respond to external pressures
Having the knowledge to better link resources to customer needs
Improving quality of outputs at all level
Improving corporate image by becoming more people orientated
Increasing the pace of change within the organization
Selfridges & Co exhibits five main characteristics of a learning organization:
Systems thinking - personal mastery - mental models - a shared vision - and team learning
Systems Developed for Selfridges & Co to Involve Others in the Process of Change
2.1- Systems to Involve Appropriate Stakeholders in Introduction to Change:
"All is connected ... no one thing can change by itself."
- Paul Hawken
"Natural Capitalism, Yoga Journal October 1994
Definition of System: System is defined as a set of routines, methods or procedures to carry out a specific activity. It is an organised structure that consists of interdependent elements, which may influence each other directly or indirectly.
Definition of Stakeholders:
Stakeholders are people who have some form of interest in the change, whether they are the targets of the change, managers or other interested parties.
Stakeholders and ChangeÂ Management:
"Change is firstly a threat, and only secondly an opportunity"
There are four key questions while introducing change that must be kept in mind.
Who needs to be told?
What they should be told?
When they should be told?
How should they be told?
The benefits will not be realised unless the key stakeholder communities accept and embrace the changes.
Involving many stakeholders in a change process does not only need a lot of resources but a proper system to involve all the stakeholders, different stakeholders need different treatment to change effectively. To avoid any resentment the organisation has to be cautious not to make any exclusion.
Introducing Halal food
Modification in the Trade Mark
Stakeholders - Systems for the Introduction of Change
Management ----Meetings, Teleconferencing, Opinion polls, Advisory boards
Employees -------Intranet, Circulars, Briefing, Brochures, Coaching, Training, Workshops
Contractors------ Formal and informal announcements, Seminars, Presentations
Customers-------- Leaflets, Advertisements, Campaigns, Feedback support
In this scenario the aim of this change introduction is to attract more consumers and differentiate against a competitor. It is essential to ensure that the customers are approached and are made aware of the change made in the trademark of the organization as well as the availability of Halal food.
2.2- Evaluation of the Systems to Involve Stakeholders:
Conferences & Presentations:
To involve the top management and important personalities conferences and presentations are the most appropriate systems for the introduction of the change. Selfridges & Co generally adopts this system to approach top management. These systems will also explain the reason to bring about the change. Unlike the customers or community it is significant to explain the reason of change to the stakeholders of this level, their approval is essential to commence the process of change.
Advantages: Modification possible in the light of reactions; questions can be answered.
Disadvantages: Communication with absentees, ensuring sub-groups all receive same message.
This form of communication to persuade potential customers to purchase or to consume the particular brand Selfridges & Co has been awarded with distinction several times for its pioneering advertisements.
Commercial advertisers often seek to generate increased consumption of their products or services through branding, which involves the repetition of an image or product name in an effort to associate related qualities with the brand in the minds of consumers.
This system can very effectively help people associate the image with the brand or name. The change in trade mark can effectively be introduced by this system. Different types of media can be used to deliver these messages, including traditional media such as newspapers, magazines, television, radio, outdoor or direct mail.
Advantages: Total coverage; standard message, better to reach highly targeted audience.
Disadvantages: Expensive, compete against clutter of advertisers.
Feedback is a comment which is positive, negative or neutral. Reputations of sellers and buyers are built based Feedback of the trading individuals. It can be among the co-workers as well.
The change in terms of colour and design of Selfridges & Co shopping bag may be trivial as compared to more sophisticated changes in the structure of an organisation, but it holds its importance.
The trademarks have a strong influence on the customer and are vital to any organisation.
It is necessary to understand how a certain image reflects its association to any organisation or brand.
Advantages: Through polls, questionnaires etc a better understanding of the perception of the stakeholder can be achieved. Similarly the reaction of the consumer by introducing Halal food will give a better understanding of stakeholder's expectations.
Disadvantages: Feedback should always be constructive and healthy; unfortunately sometimes this is not the case, negative feedback may lead to discouragement.
Implementation of Models to Ensure Ongoing Change at Selfridges & Co.
3.1- 3.2 - Adapted Models of Change for Selfridges & Co. there Implementation process and Outcomes.
"It is not the strongest of the species that survive, or the most intelligent, but the one most responsive to change."
There are a number of recognised approaches to structuring change-management programme. Organizations flourish that learn to change, while organisations that do not cope with the change have to struggle to survive. Keeping in mind my organization and its requirements I feel that the following two models best fit to ensure ongoing change in my organisation.
A - Kotter's Eight Stage Model B - Kaizen Continuous Improvement Model
In 1950's one of the foundation stone models for understanding organizational change was developed by a social scientist and physicist Kurt Lewin, and still holds true today. This model refers to the three-stage process of change. Lewin, defined organizational change with the resemblance of altering the shape of a block of ice.
UNFREEZE -------------ïƒ CHANGE --------ïƒ REFREEZE
No matter how many further steps are involved in the any change model they can be placed under three main headings of Lewins Model of Change.
Unfreeze, Change and Refreeze.
A - Kotter's Eight Stage Model
Eight significant steps an organisation should go through to ensure successful change, according to the research based on this model.
Establish a Sense of Urgency - In Selfridges & Co scenario almost identical trademark urges for a change for distinction. Catering to diversity urges certain changes to cater wider target sectors. This is exactly what Kotter explains in first step of the model examine market and competitive realities, identify and discuss crises, potential crises or major opportunities.
Form a Powerful, Guiding Coalition - assemble a group with enough power to lead the change effort - encourage the group to work together as a team. Through preparation and motivating the work force Selfridges & Co fulfils the criteria. A significant example is the ongoing programme in the organization "Changing Managers into Leaders".
Create a Vision - Selfridges & Co is a vision of one man that sustained and reached splendour. The organization creates vision to help direct the change effort - develop strategies for achieving that vision.
Communicate the Vision - Selfridges & Co puts a huge effort in using every vehicle possible to communicate the new vision and strategies.
Empower others to act on the Vision- Risk taking and non-traditional ideas, activities and actions are attributed to my organisation.
Plan and Create Short-Term Wins- Visible performance improvements are created and employees involved are generously rewarded at Selfridges & Co.
Consolidate Improvements and Produce still more Change- The organization is dynamic and constantly changes systems, structures and policies that don't fit the vision- hire, promote and develop employees who can implement the vision- reinvigorate the process with new projects themes and change agents
Institutionalise New Approaches- The management is expressive about the connections between the new behaviours and corporate success, developing the means to ensure leadership development and succession.
B - Kaizen Continuous Improvement Model
It provides a framework for developing, testing and implementing changes to the way that things are done that will lead to improvement. The core of the kaizen system is identical to one of the basic principles of Selfridges & Co.
The following steps are involved in implementation of kaizen at Selfridges & Co.
Understanding the reason to change by focusing on internal and external factors as well as keeping the continuous improvement factor in mind. The change in Food and Trademark at Selfridges both support step one.
Strong support of key people within the organization is won by framing the issue as most beneficial to the organisation.
Vision and strategy are the key supporting evidences to justify change. Selfridges & Co uses the same strategy to the organisation improvement does not need a reason "only if it's broken".
Employee concerns are acknowledged and addressed in terms of change so that they do not get confused and lose interest.
To dispel rumours one a month a staff meeting at all levels is held at Selfridges & Co, which is the fifth step in implementation of Kaizen.
Plenty of options are available for staff involvement.
My organisation ensures to generate short-term goals in order to reinforce change.
Change is accepted as a part of work culture.
Reward system is developed, ensured leadership support and feedback systems are adapted for smooth operation.
Selfridges & Co provides training and support at all levels in order to sustain the change effectively, which is in accordance to the final step "anchor" of Kaizen implementation.