Process of Change Management
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Critically evaluate the process of change management carried out by a leisure and sport organisation with which you are familiar. Use appropriate theory to evaluate the change management process in question.
Sports and fitness has come a long way over time, it is now looked upon as an industry, which operates on a global scale. Sports and Fitness could comprise clubs, health centres, big games like the Olympics, football clubs, golf courses, championships and titles ranging a multitude of sports and games. Each of these activities are part of organisations which are run just like any other organisation with management control, finance, marketing, human resource management and strategy. Each of these areas contribute to the success or failure of the enterprise. Due to immense media coverage and sponsorships, the sector has become very active, glamorised and highly competitive. The competition in this sector is becoming stronger and more players realise the lucrative benefits this sector has to offer. Television and media have greatly publicised the health and sports segment, to an extent where people are beginning to see the advantages of being part of it. Many beauty pageants have also been instrumental in creating the message about beauty, health and fitness. The outcome has been a combination of fitness and leisure centres, these are training grounds for athletes and people who would like to achieve a fitness regime by being part of these centres. More and more people are now keen to be fit and involved in sports of some kind to keep up their fitness levels and be healthy.
Crichter (1984) says, the paradox of sport is that it provides such moments of self-realisation even as it confirms their apparent impossibility elsewhere. It both realises human identity and denies other kinds of especially racial and sexual identity. It is both uncontaminated by the rest of social life and shot through with economic and political influences. It is both timeless and a product of history [Frank Kew (1997), p 12 - 25]. Sports and fitness are about helping create a self-identity, which is high on self-esteem, confidence and good belief. The following is information on sports psychology which helps understand the reasons behind so many fitness and leisure centres springing up across countries including UK.
Another interesting quote about sports comes from Huizinga, 1972, Play is essentially a free activity quite consciously outside 'ordinary' life as being 'not serious', but at the same time absorbing the player intensely and utterly. Play has no material interest, and no profit can be gained by it. It proceeds within its own proper boundaries of time and space according to fixed rules and in an orderly manner. It promotes the formation of social groupings which tend to surround themselves with secrecy and to stress their differences from the common world by disguise or other means [Cox H. Richard (1998), p 15 - 30].
The feature about sports, which is of great interest, is that the ways these organisations work have wholly different perspectives. The social practices, rule structures are self-contained and independent and so applying management practices would need to take this psychology in context to the final argument. The people who work in this industry are also influenced by the way this industry operates, their psychology is determined by this. The concept of sports and fitness as joint collaborative projects can be analysed further, there are social dynamics involved in this ball game. In this context, the social dynamics pertains to practitioners who interact with each other. As per Guttmann (1978), modern sports and fitness is monitored and handled by multinational companies, who administer and control the operations by local, regional or international levels. The people in this organisation exercise a lot of power, power to 'oversee and sanction athletes, teams and events make up rules and enforce them, organise events and certify records' [Cox H. Richard (1998), p 20 - 34]. As the sports industry had gained momentum and is diffused with different social and national groups of personnel, the bureaucracy needed to oversee the governance process of sports have become more complex and powerful. In organisations driven by such force bringing about change would be a tall order, which would need more than good management skills. Although sports and health organisations are a new phenomenon compared to a lot of sectors and industries, which have been around for decades now, change management is a subject which will be difficult and need strategic management inputs when applied to this sector. Yet given the volatile markets and external environment, change would be a factor organisations cannot avoid. Change in any organisation could be triggered due to either internal or external circumstances.
The organisation in question for this paper is a health club, which has three divisions - sports, health and beauty and a leisure centre. For the sake of protecting the identity of the club, the name of the organisation has been changed to 'Fitness first'. The problems in this organisation first started with the introduction of a new arm to the organisation - Sports Centre, where world famous coaches along with fringe benefits of private training gave professional and prospective athletes the option of being part of a club. Fitness first was initiated and conceptualised in the year 2001, the infrastructure and management were the best in the industry and finance was not a problem since the funding came from heavy weights in the Sports industry. To begin with the senior management that was brought on board by the two directors were given a lot of autonomy in running the business and expansion plans. The first two years in the business witnessed an inflow of members who were ready to pay a hefty annual fee to be part of the club. This was because of the personal care and interest each member was able to enjoy along with the state of the art infrastructure. The members realised the value of such benefits and were promoting the club through the word of mouth. Any business is good to go once the customers are satisfied with the deliverables and they see value for money. By the year 2003, the club had opened up 20 branches across England with additional features like a Beauty centre, which was very popular with both, the male and female members. The problem started in the year 2004 with the initiation of the Sports centre facility, the directors increasing interference, bureaucracy, lack of autonomy for the management and complacency on part of the management towards the operational and customer service aspects of the business.
The first sign was the failure of a club, which had opened up in the posh area of Kensington, London. The management was unable to understand the reasons for the lack of members despite heavy promotional campaigns. It was then observed that almost seven clubs had not enrolled new members over a period of three months. Finally the first Sports centre initiated at the Reading branch was showing blatant signs of failure. From a membership base of six professional athletes and 4 beginners, three beginners had already dropped out in the first month itself and the remaining members were considering giving up membership of the sports centre. All this had a combined effect on the revenue figures as well as dwindling profits in the first quarter of 2004. Fortunately the two directors realised that there were serious problems with the health club and leisure centre and a meeting was called upon with the entire management team across all clubs. A whirlwind strategic conference was organised, which lasted four days, and everyone realised that there was a need for introspection and change. The main problems identified during the conference were -
Lack of Autonomy
Lack of focus on customer service
Lack of flexibility amongst management
Lack of improvisation tools to enhance business prospects
Lack of focus on new customers as well as old
Lack of personalisation, which had been a competitive advantage at one time
The problem now was to understand and plan a strategy to combat all the problems listed above. Change is always a difficult proposition since it needs people to do something new, something they are not aware of and this especially since it takes them into an insecure environment.
The framework involving strategic change might comprise the organisation structure, culture and skill set. When implementing plans for a change proposal, one needs to comprehend if the change runs as deep as the organisation structure and culture since the latter is a deep process which needs a lot of time, patience, acceptability and understanding. Peters and Watermans (1982) defined strategy as the core structure of change, strategy is the deliberate or emergent pattern of decisions which shape an organisation's future and its fit within its environment. These decisions may involve changing the future scope and shape of activities or major areas of internal change aimed at protecting or enhancing capability. [Grundy Tony (1993), p 28]
The changes at 'fitness first' would not only need the management personnel who were part of the conference but also individuals who were contributing at one level or another at every branch. Each personnel needed to understand the extent of the problem and be willing to bring about the required change so that the organisation could once more progress towards growth, profitability and satisfied customers. Carnall (1986) is an important contributor to the process of managing change. As per Carnall, implementing change goes through a series of stages, which involve, denial, defence, discarding, adapting and internalising. Change needs very adept and fragile handling of people, according to Lewin (1935), the cycle of change spans a considerable amount of time, it depends on how fundamental or challenging the change is, also there is always some decline in performance in managers and that's what the change agents need to account for [Grundy Tony (1993), 40 - 46]. A change agent is the person in charge of bringing about the change process; the agent might be internal or external depending on the circumstances as well as the extent of change. This agent is a manager with special qualities, which will make him/her effective and successful in planning and executing the process. Charles Handy (1999) uses the ten roles defined by Mintzberg as a basis for making one understand the different roles of the manager. As leading personnel the manager needs to be a figurehead, leader and liaison, all these are interpersonal roles. In the capacity of an administrator, he/she needs to monitor, disseminate and be a spokesperson these are informational roles. Lastly as a fixator, he/she need to be an entrepreneur, disturbance handler, resource allocator and negotiator, these are decisional roles. Since the meeting at Fitness First, it was strategically decided that each centre would be assigned a change agent who will be internal given the extent of the problem. The senior management, local teams and the directors based on a compilation of all the above qualities, mutually listed the change agents. Charles Handy brings in some interesting perspective on how organisations are, as much as people would like to view them as well-oiled machinery, they comprise of people. People from different backgrounds, cultures, lives, opinions and behaviour. All these people compete for resources, power, recognition and their own judgements. There will always be a difference of opinions, values and culture, each one would conflicts of priorities and goals, 'there are pressure groups and lobbies, cliques and cabals, rivalries and contests, clashes of personality and bonds of alliances'. [Charles Handy (1999), p 209 - 210]
Since the problems being faced at Fitness First were grave in appearance, the directors were very forthcoming in following a participative approach, from top to down in the organisation. They realised that the autonomy and right to exercise power in the individual sphere of the managers was a positive attribute, which had to return to the way the organisation functioned. As per Rosabeth Moss Kanter (1983), the participative approach is only taken when the change agents view the problem as internally driven, based on choice and responsiveness, rather than something which is imposed externally facing extreme resistance. The architecture of change needs an awareness of foundations, Rosabeth Moss Kanter (1983) an academic expert on change management states that the change agents need this history of relationships, coordination, mutual trust to learn from a successful story and imbibe the values in the new process. The art and architecture of change, also involves designing reports about the past to elicit the present actions required for the future [Rosabeth Moss Kanter (1983), p 288 - 290].
The building blocks of change can be easily interpreted from Quinn's definition of managing strategic change, The most effective strategies of major enterprises tends to emerge step-by-step from an iterative process in which the organisation probes the future, experiments, and learns from a series of partial commitments rather than through global formulations of global strategies. Good managers are aware of this process, and they consciously intervene in it. They use it to improve the information available for decisions and to build to improve the information available for decisions and to build the psychological identification essential to successful strategies. Such logical incrementalism is not 'muddling' as most people understand that word it honours and utilises the global analyses inherent in formal strategy formulation models and embraces the central tenets of the political or power-behavioural approaches to such decision making [Rosabeth Moss Kanter (1983), p 288 - 295].
The process of change as defined by so many academics needs trust, loyalty and faith in the change agent who will lead the people involved through the process. The managerial style in organisations like Fitness First needs to change as part of the change management process. The hierarchical form needs to become more networked where people have access to information, there is informality, equality and there is lateral bottom up communication. Birchall and Lyons (1995), talk some more about the way businesses need to become more effective and efficient, as this will help in the change process, similar to fitness first businesses need to rethink the way work is being organised and executed. This is due to the changing demands of the customers, the expectations and aspirations of the employees; the transformation comes through with revamping of operations and by taking advantage of emerging possibilities.
Expectations and communication brings us back to the way the change agents would draw personnel at Fitness First into rectifying the problems being faced by the organisation. Change is not always about something new; sometimes it is about going back to the foundation and grass root level of the origination of the business. Since the change was primarily internal, managing the expectations of the people involved about the quantity and quality of change would be very important. The people involved need to know that the change is being brought about within the structure and culture of the organisation to eventually benefit everyone by being part of a successful venture. Since the profits are dwindling, it does call for extreme measures, which people might not be expecting. The biggest fear amongst employees in the face of change is the insecurity of not having a job, these fears had to be allayed by the change agents at the earliest else the performance would dip to a large extent. The second step was to know expectations and then communicating the plan for managing and executing change in the way work was being handled. The final steps needed at Fitness First were -
Changing the organisation structure in certain places depending on the agenda and need
Make the business more result oriented through customer satisfaction
Training for all personnel to understand customer relationship management
Motivate the employees through personal belief to work towards rectifying the problems
Open door communication policies to make operations transparent
Introduce annual reward management system for employees and customers
A communication plan was the first step towards personnel involvement in the change process. When complacency sets in and people get comfortable with their surroundings, change mostly uproots them from this comfort zone and more often than not, the results are not very encouraging. The change agents brought into play an effective communication plan, which covered the scope of change, the effects and results. Since there was a need for restructuring, the involvement of people is necessary, listening and learning become prime to making it a success. The agent has to take people into confidence about how the change will affect them internally as well as externally, from the view point of the organisation as well as personally. Another important factor to be remembered by the change agents is the five-model process for managing change - diagnosis, planning, implementation, control and learning. At fitness first the first two stages were near completion and the following three were moving at a parallel pace with the ensured commitment of the staff. According to Margaret Davis and David Weckler (1996), a major factor underpinning the success of failure of change is the capability of the organisation in question. Organisational capability is a big part of the organisation's competitive advantage; it is also a reflection of its inherent flexibility, adaptability, and capacity to preserve single-mindedness, rationality despite all pressures, internal or external.
Coming to fitness first, now that a detailed analysis of the organisation structure and resources was through with a new one in place, displacement of employees from their previous positions had to be dealt with patience. It is important to time and again bring in communication tools and enforce the change objective and what it does on a larger scale. The anxiety and insecurity need to be dealt with, once the commitment is part of the change project, success is not difficult. Once the change agents had spent time, money and effort in designing the new organisation chart, it was important to see how well it could be implemented. This brought us to the three important ingredients of implementation - communication, impact analysis and transition management. In this case the employees needed to know if the reporting system would be different, working in different divisions under different people would be a part of this transition. The customers needed to know if the services changed with this process in flow and if the representatives they dealt with earlier would also change. On all accounts, effective communication was introduced through a first ever group wide meeting being called to mitigate or absolve any doubts which might hinder the change process. The customers were dealt with newsletters and individual meetings as deemed appropriate. Fitness First change agents had devised a list of ripples these changes might create and so there were already back up resources and plans in place. Each Change Agent had accounted for a transition manager in their teams who would be responsible in overseeing that the transition took place as effectively and smoothly as possible.
After long, fitness first had brought changes in the structure and introduced open communication channels; there was more autonomy in the organisation. This gave way to a common platform for employees to chip in ideas about growth potential and customer enrolment. The sports centre introduction was seen as a moderate expansion plan and so new associates and trainers were introduced to cater to the demands of upcoming talent. Apparently a talk with the old members revealed that they missed personal training regimes and a dedicated coach scenario, which led them to the decision of quitting membership. The introduction of the Customer Relationship Management program was an effective measure, which reintroduced one to one personal communication between members and the club centres. There was a monthly reward program for the most successful idea of the month; all these tools went a long way in hauling employee confidence, motivation and loyalty. The customers were also content and satisfied with the resurgence of these change measures, which showed responsiveness on part of the club towards their reaction and value. Customers always need to feel important and taken care of; this is the oldest adage for any successful business.
To conclude the design of an organisation cannot be rigid. Given the current competitive environment and unpredictable markets, they need to be more in tune with the customers and changing business conditions. The only constant is change and so any organisation - their structure and business processes need to be productive, flexible, adaptable and responsive to changing business needs. Fitness First was able to bring about internal changes which the management deemed fit, yet in the future there will always be need for more review processes to see when and where another change might be required. This was a learning lesson for fitness first, a platform for them to realise the need to become a learning organisation to stay abreast of competition and external environment. Senge (1990) introduced the concept of the learning organisation, one, which constantly reflects, understands, and evolves and changes based on internal and external conflicts and needs. All organisations need to imbibe the qualities of a learning organisation and the sooner they do o the better. Finally Change involves the interaction of a number if systems within an organisation. These may interact with one another in ways, which will either facilitate or inhibit change. A key factor in managing change effectively is to understand how these systems interact with one another. Openness to understanding these interdependencies is identified by Senge as being a crucial part of 'the learning organisation' [Handy Charles (1999), p 12 - 25].
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