We can define Change Management by saying that it's a necessary approach towards dealing with Change. Change is one thing which is certain and it is applicable to an organization as well as an individual. There are three aspects to Change Management and we can list them in the following manner:
Recognizing and adapting to change
Understanding change and try and controlling it
The approach towards dealing with change has to proactive and this is applicable in all the above listed aspects. The business environment for an organization is dynamic and changes continuously with respect to procedures and technology. They have to be ready for these situations in order to profit from new opportunities.
Adaptation has become the keyword in today's world. It is true for everything, ranging from Organizations to Individuals to Plants & Animals. There can be changing conditions which they might be powerless to control. How well each one deals with change decides how much they will thrive in today's world. The approach each one takes is the key factor, impacting their success.
There are 3 Questions which we have to answer before understanding Change Management:
What is our position right now?
What is the position we want to be in?
How will we get to that position?
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We have to think about and answer these questions before starting the Change Management Process. Answering these questions can bring for us a clear layout and also the scope of change. We can work then in an optimized and refined manner. One more thing we have to look towards is the Stakeholders. Change Management without understanding the viewpoint of the Stakeholders does not make any sense. They also have to understand what are the changes being faced by the organization and we have to understand how they perceive the changes. If they perceive the changes as not significant they will not want us to put money and effort in the Change Management process. But if they do realize that changes are indeed very important, then they would support us in the process and this can mean a lot towards getting success.
What are the steps for implementing change?
We can list down 5 points which should be carried out in order to implement change:
Develop a strong enough case for change and involve employees
Decide who will be managing what process
Enough amount of Communication
The plan which you develop should be realistic
What you learn, should be imbibed into the organizational culture
Importance of Good Leadership
How important is leadership during the whole Change Management process cannot be understated. Leadership here does not mean just leading, but also to showing yourself as an inspiration and involving the employees in the process. The leader has to strike right balance between his duties and the amount of time spent on employee involvement. The employees should be given enough freedom to work on the processes assigned to them and the leader should interfere only when required. In the initial phase itself the leader should set a framework for the employees to work and the expected deliverables so that everyone is on the same page. The leader also has to make the employees understand how important are the changes for the organization and how important is the work which they are doing. This will motivate them towards giving their best.
Why do we then sometimes don't get the desired results from Change Management?
The leader is not able to develop a strong enough for change
Not enough clear understanding of Change and what it is about
Employees not involved enough. Without proper employee involvement Change Management cannot be implemented
Incorrect Implementation. Sometimes the plans developed by leaders are not correct and the employees are not able to work on them
Technology Gap and Bridging the Gap by Companies:
There has always been a technology gap between competitors and this has sometimes resulted in wide ranging changes in the field of competition. There have been cases where companies have come up with a radical new technology and leapfrogged over the competitors in terms of technology. Earlier, whenever there were studies done, they all concluded that technology gap bridges through the learning curve and it takes time. But this has now changed. Nowadays "Disruptive Strategies" by companies change the whole playing field itself and that is why it is very important to understand and anticipate changes in terms of technology. For example, Nintendo changed the way people perceived Video Gaming and how they used to play the games. They brought in their new product Nintendo Wii and the video gaming experience was never the same. Sony and Microsoft were not prepared and basically Nintendo leapfrogged over them in this case. We will discuss more about Nintendo case later on in this report.
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It is very difficult for the companies which are young and also who have come late in the industry to compete with this level of technological changes. Very few companies in any industry have the kind of resources, which can help them continuously expand their technological horizons. Most of the companies depend on external resources and their own Learning Curve in order to improve and develop. What newcomers to the field do initially is that try and replicate the competitors' product and try and bring some of their own changes and innovations in the replicated product. This product becomes then the first level of framework on which the newcomers then develop their product upon. Initially sometimes the big firms give some of their own obsolete technologies to the new smaller firms so that they can start their work. But as the new firms start reaching a new level technological sophistication, the big firms stop the knowledge transfer process. This means that the new smaller firms have to keep on building their own R&D Processes in order to compete with the changes in technology. Everything in the end depends upon the Cost & Value Ratio. If the new and smaller firms can work not only on the product, but also on how they can lower its cost, they might have a better chance of dealing with the technological changes being brought by the big firms.
Disruptive Strategy of Nintendo: Microsoft & Sony Playing Catch Up Now
The Technological Cycle in the gaming industry is normally of 5-6 years. Sometimes a technology is brought into the market which takes the whole gaming experience to a different level altogether. Generally the big firms go towards upgrading their existing products rather than continuously developing new technologies. For example, in 2006, when the new gaming consoles came, Sony and Microsoft upgraded Playstation & Xbox respectively. But this time, Nintendo had radically different plans. Through an amazing technological research and development they came up "Nintendo Wii". At some point of time Nintendo used to be the leaders in the gaming industry, but they had slowly and gradually lost their market share to Sony and Microsoft. They had to come up with something which would take the market by storm. That's why they came up with the Nintendo Wii. They leapfrogged Sony and Microsoft in the terms of technology and surprised everyone, even people who never had any interest in the Video Games. The demand for the Nintendo was so high early on, that they couldn't balance the demand with the supply in the first year. This was not only because of existing gamers using the Wii, but also because Wii captured people who were non-gamers. This took Sony and Microsoft by surprise because they had not anticipated the disruptive strategy of Nintendo. One of the things Nintendo did right was appealing to a bigger set of customers and non-customers than the other firms. For example, they brought in a product called Wii Fit. This appealed to a lot of women who were non-gamers because it has a feature with which you can exercise on a mat while playing Wii. Now, many women who were non-gamers but were bent towards staying fit tried this product and actually liked it. It appealed to their latent need of playing games and staying fit.
So why is Nintendo a preferred product now?
It is more children friendly
It is cheaper as compared to Playstation3 and Xbox360
It appeals to non-gamers because of the sheer excellent gaming experience
Sales Figures Of Nintendo:
In 2006: 3.19 Million Units Sold World Wide
In 2007: 20.13 Million Units Sold World Wide
In 2008: 44.96 Million Units Sold World Wide
In 2009: 67.45 Million Units Sold World Wide
In 2010 (till 30 Sept): 75.90 Million Units Sold World Wide
The Case Of Nokia & Apple: Nokia Playing Catch-Up
The Mobile Phone industry has seen radical changes after its inception. Nowadays a mobile phone means more than just a phone to people. It should include everything possible, ranging from a camera, an audio-video player to a navigator. The technological changes have been wide ranging and big firms have changed the way the game is played. Apple is a leader in this regard.
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What your mobile has in terms of content is the basic platform on which the mobile phone wars are fought on nowadays. This is exactly where Nokia has been losing the battle. The Smart Phone industry has evolved way beyond what Nokia had anticipated. Ideally, they should have been the leader in this industry since they had developed the phone called "Communicator" before the others. It had a full web browsing capability. But Apple changed the whole game by bringing in the Iphone which went way ahead of a conventional Smart Phone. Nokia should have kept on working on the technology. That would have prepared them better in dealing with the changes which were about to come.
The problem with Nokia has majorly been the way they have executed their efforts. They have always had very good software engineers who could have developed the same or higher level of technology. The problem has been the Change Management Process. They were not able to anticipate the changes and also what competitors could come out with.
There has been one more issue with Nokia. It is the fact that the Development Softwares available to the Apple software engineers are very user friendly. Nokia software engineers on the other hand have to work on more tedious and non-user friendly Development Softwares. There is normally a myriad of different applications which they have to work upon and this makes continuous innovation a more difficult task.
Response Of Nokia: Ovi
One response of Nokia has been to develop a new technology called Ovi. Ovi basically means Door in Finnish. They announced the new technology in August 29, 2007. They have made the effort to acquire the main elements of Ovi which includes IP, Patent and components for Synchronization.
So what is Ovi?
Ovi is basically the name for Nokia's Internet Services. It can be used from a variety of places including Computer, Web and a mobile phone. There are five main areas which Nokia has looked at in Ovi:
The idea behind Ovi is to include third party softwares such as Flickr. It is important for Nokia to move into these kinds of services if they want to compete with Apple.
Other Changes in Nokia
One of the things which have changed in Nokia is their effort towards improving their Service Experience. Many managers have been hired precisely for this purpose. Nokia faces different kinds of requests everyday from thousands of customers. Improving this experience has been an effort they have started putting. They have put a lot of thought not only on the devices but also the customers. The aim of Nokia is to get in touch with maximum no. of customers both online and in-touch and get quality feedbacks from them. They also want them to avail the opportunity of downloading upgrades from Nokia. This would make sense for Nokia from revenue generation point of view also, since they would be able to sell the same thing at a very low additional cost.
One more thing they have done is to acquire Navteq. This has helped them in building a maps service based on GPS Location. This is helpful for their network of gaming users. As compared to this, Apple is ahead from Nokia in terms of e-book readers, education, science tools and also hobby based applications. Apple also has way more number of applications for their Iphone as compared to Nokia phones. This is a key problem for Nokia. The number of downloads for Apple is considered to be reaching a billion. Apple is also benefitting from the commission charges which they get from these download. The opportunities for download for users have been one of the propelling factors towards sales of Apple IPhone.
The Game is not lost for Nokia
Nokia has been playing Catch-Up to Apple in the smart phones market. But this doesn't mean that they have lost the game. They have understood what to do and how to bring about the changes by re-organizing and coming back into the market for e.g. through their new phone Nokia5800. A lot of Nokia users switched to Apple just courtesy new and diversified features of the Iphone. But Nokia is slowly and gradually coming back into the market. By improving their service experience, they are concentrating on the customers too. They have realized that the mobile phone industry has changed and a mobile phone is not a device meant for only talking. It has evolved into a much more wide concept with new ones getting added everyday.
In the end, we can say that the strategy being followed by a company, be it being a technological leader in the field of competition or be it playing Catch-Up, depends on the company itself and not necessarily on its competitors. It depends on how well the company can anticipate the changes which are going to happen and also on how well they are prepared for them. If the top management of the company and also its stakeholders feels that the Change Management process is a key component of growth, they will have a better chance of thriving and taking maximum advantage of the changes. Continuous innovation is a must for both leaders and the companies playing Catch-Up as shown in the cases discussed earlier. Market Leaders cannot rest on the top with their existing technologies because any day a competitor might come and change the whole game play. It is but easier said than done. A successful Change Management Process depends on a lot of factors which are both intrinsic and extrinsic.
Intrinsic Factors can be:
Top-Level-Management commitment towards continuous development and putting money and effort to deal with possible changes
Commitment of the employees towards giving their best for the company
The organizational hierarchy and the culture
The expertise and skills of the employees and their Learning Curve
Extrinsic Factors can be:
The ability of the competitors to develop and innovate
The government regulations in various fields
The mindset of customers towards new technologies
If a company can take into account all these factors and build and prepare themselves for the ever dynamic and changing environment, they would have a really good chance of being the leaders in their fields rather than playing catch-up