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Student Record Number (SRN): 1047667

Degree: MSc Management with Streams
Module: Leadership and Change Management
Date of submission: 19/08/14
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Table of Contents

SI

Name of the Content

Page No

Introduction

Internal and External challenges for senior management

Change Management Model:

Change management theories:

Recommendations:

Outline of Change Management Strategy

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References

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Introduction:
Strategic management is a very crucial part of the organization which formulates, implement and
evaluate decisions which ultimately help to reach the organizational objectives. Through this
process, strategic manager integrates all the activities in the functional factor of the business such
as marketing, sales, production etc that ultimately helps the organization to reach to its goals
(Mouton, 1964).
In this paper we will discuss the strategic leadership and change management system in the
relocation process of Galaxy, their refrigerator production unit from Germany to China. The
leadership process and change management is very crucial part in this relocation process and this
relocation is very important for the organization to reach the organizational goal. In this
relocation process, it is important to understand the reason of the relocation that is globalization
process and innovation of Technology which seems to be very essential for the sustainability of
the organization. So, these relocation processes is very important for the organizationand it need
to develop a leadership process and a proper change management to reach the organizational
goals.
Leadership and Change Management:
The leadership is a way of setting direction to the people so that they follow the instruction to
reach specific goal. The leader has some social influences and shares his expertise in a way of
organizing people. In this process, the leader uses his personal traits, situational interaction; share
his vision in a way or organizing change within the organization as well as within the process
(Victor, 2002). In the relocation process of Galaxy, there are different conflicting issues among
the management and the staff and both the group have specific interest in this process. So, it is
essential to develop a leadership process in the organization so that the relocation process
becomes very successful and that will help the organization to reach to its organizational goals.

The change management is a process, tools and techniques in a way of managing people-side
change and also to achieve the business outcome (Creasey, T. 2008).The goal of the change
management is to develop a process, a system, an organizational structure so that the
organization can solve their specific problems or opportunities. Every change has specific impact
on the organizational process and the strategic manager needs to have specific strategies for
planning the change, managing the change and reinforcing the change. In case of Relocation
process of Galaxy, the strategic manager will need to prepare individual change model,
communication with different individuals and providing training to the people involved with the
process and provide resistance management so that the change becomes sustainable for the
organization.
Internal and External challenges for senior management:
In the process of change management, change management is a comprehensive term. In this
process, it is essential to see the change impact in both in the individual level as well as in the
organizational level.
As an organization Galaxy Technology Company will need to face the following external
challenges:
The resistance of change: As the galaxy has decided to move their production in the
interest of reducing production cost it would be a challenge for the company to sustain
the market as it affects in many other issues related to the Product such as fear of
unknown, fear of loss, fear of failure, cultural assumptions and values, brand value,
acceptance level and customer reactions in changing this things and actual marginal cost
of production and marketing impact etc.
Brand risk: When company would start their production plant in different geographical
continent and new production line would work it would take times to grow again
because some customers brought this product because they had a long time belief of the
quality of the production of the company in particular country setting. There is also
having a myth that the quality of the Chinese produced product is low which may
endanger for the Galaxy and put them in risk.
Loss of customers and customers reaction: As we state before, some customers
brought particular product because they have strong faith on particular countrys
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production therefore it have a potential risk of losing customers when company move in
different geographic location. In addition to it, as we have seen from the case studies that
Issues of quality: As the production setting in new continent is completely new and
therefore the production quality is yet not known. As a consequence, an issue of product
quality is also a risk factor for the organization.
Risk of losing skilled labour: From the case study it has not been cleared after shifting
the plant in China and what actions will be taken by the company in retaining their
existing employees. In addition to it, how the employees will react in adopting in new
country. Again, employees have more potential risk of not willing to shift in new places
as well which ultimately resulted loosing of skilled labor.
As an organization Galaxy Technology Company will need to face the following external
challenges:
The effect of globalization: Multinational organizations are heavily involved in global a
change that may put the company on global competition in various aspects of business
and that is a critical issue for the senior level management officials.
The effect of workforce diversity: The workforce diversity increases the participation
of different social background and cultural workers that have an impact on overall
workforce of the organization.
Technological change: Due to the rapid change of technological arena it is also a
challenge for Galaxy as an organization in competing with contemporary market leaders.
Managing ethical behaviour and corporate social responsibility: It would be hard for
the galaxy to fulfill their corporate social responsibility in two different geographic
locations. As the companys main customers based in Germany, Italy and European
region so it would be difficult for them to fulfill corporate social responsibility in both
In this process of changes in the individual level as well as the organizational level is very
important for the strategic manager and he will need to consider the existing change management
model and will have to think different aspect of relocation process of Galaxy. Most common
formal model of change management, the manager will need to have a good understanding of
different change management models and theories.
Change Management Model: The change management model is very important in
understanding the strategic change of the organization. Cummings and Worley (2009) have
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mentioned that there are different change management model which are very interesting in the
analyses of change management organization. Some of the interesting model includes,
Lewin's Force Field Analysis Model:This model was initiated by psychologist Kurt Lewin in
1950. In this model, Lewin noted that the majority of the people would like to prefer and operate
within certain zones of safety (Lewin, 1943). In this process, Lewin proposed some stages such
as

Unfreeze: In this process, he says that there are some people who always resist the
change. In this condition, it is important to give some time to this people and motivation

need to be given so that the acceptance creates among the resistant.

Transition: after initiating the process, some people becomes confused about the process
and the transition period starts. In this process, adequate leadership need to be ensured so

that the transition period becomes stable within the process.

Refreeze: Refreeze is a also an important stage when the change is established and the
change is implemented and the company becomes stable again. But in this process, it is
also important to work within the new guidelines.

In this process, it is also important to have a balance by the interaction of two opposing sets of
forces such as the driving force and the opposing forces. In this process, it is important to see the
change the strategic manager wants to see, making a brainstorming or mind map for the driving
forces, brainstorming or mind map the restraint forces, evaluating both the forces, reviewing the
forces, the feasible strategies for the matter etc. Lewin's Force Field Analysis Model can be
showed as

From the model, we can differentiate the expectation of the driving force from the management
perspective and the restraining forces from the employees perspective and it is important to
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tackle the situation for the overall development for the sustainable development of the
organization. In this case, the drawing line between the Galaxy management and employee is
very crucial for the both parties.
As the change was planned for Galaxy refrigerator production company a Kert Lewins threestage model of planned change can be very effective for them. The successful implementation of
their stage model that overly prescriptive and do not restrict anyone. Lewin (1951) suggests that
change is the preliminary factors that drive to resist the change should be identified. It can be
identified from the companys Force Field analysis. According to Lewin the change is asserted
that change occurs as a result of shifting the equilibrium between the opposing forces removed.
Proscis 3-Phase Change Management Process: Proscis 3-Phase change management process
is also important in the change management process of the organization. In this process, three
stages includes, (i) Preparing for Change, (ii) Managing the Change and (iii) Reinforcing the
Change. In this model, Proscis model elaborates the individual change into the process and also
the organizational change management and in this process, he suggest a holistic solution in every
level in the organization. In case of Galaxy, it is very essential to follow the 3-phase change
management process such as prepare for the change in a long term way, then taking some
initiatives in China and India and at the same time, some change initiative of shifting the
refrigerator equipment to china and long tern relocation of the organization for the sustainable
development is very crucial initiatives for the organization.
Kotter's 8-Step Change Model
Kotters model is also very important in the understanding of change management process of
Galaxy. In this process, Kotters have elaborated different stage of changes such as,

Creating Urgency: in this process, it is essential for Galaxy to create a sense of urgency

so that the initiative of change is felt among the people of the organization.
Form a powerful coalition: In this process, it is essential to make people feel that the
change is necessary for the betterment. It is also important to understand the emotional

attachment to the process and it is also important to make a team in this process.
Create a vision for Change: In this process, it is important to determine the values for
the change so that people conforms to the changes. In this process, it is also important to
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create a strategy so that the change initiatives can be taken within the organizational

process.
Communicate with Vision: In this process of organizational changes, it is very
important to communicate with the vision so that individual is not fluctuating from the

vision.
Remove Obstacle: In this process, the strategic manager needs to be sure that the
obstacle is dealt in a smart way that the change initiatives work in the organizational
changes. In this process, it is essential to identify, hire and change leaders so that the goal

of change is attained.
Create short term win: In this process, it is also important the change should be initiated
with the short term initiatives. In this process, it is essential to look for sure-fire projects

so that the rivals get some positive idea about the change initiatives.
Build on the change: In this process of change initiatives, it is essential to analyze what
is right and what is essential for the betterment of the project. Galaxy company can build
the change management strategies through analyzing the consequence of shifting their

plant in China.
Anchor the change in the corporate culture: In this process Galaxy can essential to
address the initiatives taken for the change and incorporate ideas for value adding for the
change initiatives.

In the relocation process of Galaxy, the Cotters 8 step change model is very effective as it
shows the ways of progress initiatives can be taken in an organizational structure. To resolve this
scenario, kotters 8 step change model has a great relevance to it. There should be a proper
communication between the key stakeholders of the organisation on the need of taking change.
When change occurs at an organisational level, then every member of the organisation is directly
or indirectly gets affected and henceforth to avoid any sort of hurdle a change model should be
used at organisation level, to prepare and plan to resolve the unwarranted situation.
Kotter eight step change model has many drawbacks and benefits. The advantages are that it is
the step by step, which is easy to follow model. Another is that it does not focus on change itself,
but rather the acceptance and the preparation of this change, which makes it an easy transition.
Focuses on the buy-in of employees as the focus for success.

Prosci ADKAR Model provides the insights for the individual level change that provides the
guidelines for individual level change initiatives. In this model, Prosci ADKAR says that
Awareness, Desire, Knowledge, Ability and Reinforcement are essential for individual level
organizational changes.
The McKinsey 7S Framework: The McKinsey 7S Framework is also essential to
make sure that the organization is working with harmony. This framework is
essential in understanding the organizational change within the organization.
In this process, there are many internal factors, some are external factors
and some perspective creates within the organization. The 7s model will
help in enhancing the performance of the organization, will effect on the
future change of the organization, will align the departments in a way of
merger or acquisition.

Hard

Soft

Elements

Elements

Strategy

Shared
Values

Structure

Skills

Systems

Style
Staff
Fig: The elements of 7s model

Mckinsey 7s model is very important to understand the change initiatives and it is seen that the
change initiative are highly interlinked to one another with the hard elements and the soft
elements. These elements are intricately linked with the process and the change initiatives takes
strategic initiatives.

Change management theories:

In the change management process, it is also important to have batter understanding on the
theoretical knowledge of change management process. The theories includes,
Transactional Leadership: Transactional Leadership is also known as managerial leadership
which focuses on the supervision, organization and group performance. In this process of
transactional leadership process, the basic assumption goes to the understanding of efficient
management. In this process, it says that in a in a clear chain of command, the people perform
their best. Transactional leadership is a proactive approach which works within the
organizational culture (Christina, 2009). In this process, the employees are motivated for the selfinterest and Management-by-exception maintains the status quo which reduces stress and directs
for actions to improve performance. It also say that the workers follow the clear instruction when
they are working to achieve a specific goal for the organization (Duane, 2010).. In this process, it
is also important to monitor the employees so that they are giving their best for the organization.

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In the relocation process of Galaxy, it is important to have a transactional leadership who will be
motivating the employees and will share the organizational goal and policies of the relocation so
that that the mutual benefit is ensured.
Contingency Theories of Leadership: The Contingency Theories of Leadership is also
important in the understanding of Change management process of the organization. This
leadership theories emphases on the traits or behaviors and situational factors which is very
essential in the relocation of Galaxy. In this process, the leadership process is seen as
consideration factors such as the behavior of the leader, the interpersonal relationship of the
leader, and his attitudes to the subordinators. In this process, it is also important to consider the
initiating structure such as role assignment, planning, scheduling so that the specific goal of the
organization is achieved. In thus leadership approach, it is very important to build a cooperative
relationship with the subordinates, In this process, it is also essential to have a structured
relationship with the member so that the standard procedure of leader-member relationship
develops. The position power of the leader is also important so that the reward and punishment
relation exists among the leader and member.
Fiedler contingency theory is also very crucial in the understanding of the leadership model
which shows different leadership style on the basis of Least-Preferred Co-Worker (LPC) Scale.
This is a task oriented leadership model which is very crucial for the organization in the
understanding of leadership model.
Situational Favorableness
Situational Favorableness provides crucial role in different situations such as :
Leader-Member Relations: It is important to have trust among the leader and the member. It is
important that members have the confidence over the member and the member also have the
confidence over the leader.
Task Structure: It is important to have a clear task structure of the leader and the member
Leader's Position Power: the leader will be enjoying the power to direct the group, will be
rewarded with the group and will be punished for the group.
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In the relocation of Galaxy, it is very important to understand the role of the leader and the
change management will need to take initiative in finding the leader and there will be a fair deal
with the leader and the management so that the organization can reach the goal of sustainable
development for the betterment of both the group. In this process, the organization needs to have
proper strategy of the whole relocation process that will help the leader in the proper
management of the relocation process.
Recommendations:
In the relocation process, Leadership and change management should consider the impacts of the
globalization process and at the same time, it is also important to understand the feasibility of the
changes. In this process, it is also important to understand the future aspect of adapting with the
new environments etc. In this process, the leadership and change management will have to have
a proper strategy for the full relocation process. Here, it is important make segmentation of the
whole process and different initiatives will be taken for the successful relocation process of the
organization.
The implementation plan becomes the stepping stone for any project and it determines the
success and failure of the project. Therefore, implementation plan achieves high importance and
should be planned and decided by considering all the business factors which includes internal
and external and all the stakeholders should be taken in confidence. The widely accepted
implementation plan for strategic change being suggested by Johnson, Scholars and Whittington
has been considered to be implemented for Galaxy that are illustrated below: Gaining support of
the key stakeholders, who include key decision makers and the facilitators. They should be
provided with enough relevant information on the needs and benefits of adopting the planned
change.

The Galaxy Company should offer a lucrative offers and incentives for skilled labour and
offer relocation job offers to ensure the right skilled person in the organization.

In order to protect brand image and customers reactions the management should take
some precautionary steps and more responsible act with their key stakeholders.

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As the employees are the most vital for quality product production therefore it is
advisable for Galaxy Company to ensure employees highly skilled employees
involvement in the process of organizational change.

A full detailed plan should be prepared with proper start and end date and should include
and define the various stages of the change process with the time frame. This detailed
implementation plan should be agreed by all the department heads and the decision
makers.

A strategy should be planned to obtain the commitment of the staff to make this strategic
change feasible and achievable to attract more new customers and fulfill the requirement
of the existing customers.

The ground level staff and the users who will be using the new production system should
be brought in, in the project plan and should be asked for their feedback and reviews for
ensuring the quality of the products.

The staff should be given proper recognition and reward on based on their performance in
the organization.

The staff should be given development and training programmed on the new skills
required which will help in making the implementation plan successfully without
compromising the quality of the product.

Proper change control method and performance monitoring system should be put into
place

The changes happening at various stages should be analyzed and evaluated well.

To monitor the performance, the management should follow given methods, (Teachmebussiness,
2011):

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Setting SMART objectives for every individual team which should be reviewed on
monthly basis.

The review policy needs to be adopted at both team and individual level on end of course
term.

Setting Benchmark for individual teams and then reviewing the performance against
benchmark

Setting KPIs for every team based on the work task they are responsible for. Quantity
based performance system should be adopted, like number of students enrolled, number
of student queries processed, number of students re-enrolling for other course, etc.

Quantified standards should be set for every individual teams, and the comparisons of the
performance should be made with standards.

360 Degree Feedback is considered to be one of the best performance measuring

instrument which helps to analyze the performance of team with every individual aspect
which is directly or indirectly related.
.

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References

Aiken, C. and Keller, S. (2009). "The Irrational Side of Change Management". The
McKinsey Quarterly. McKinsey & Company. Retrieved 2009-06-18.

Blake, R.andMouton, J. (1964). The Managerial Grid: The Key to Leadership

Excellence. Houston: Gulf Publishing Co.

Changing Minds (2012). Stakeholders in change [Online]. Available at:

http://changingminds.org/disciplines/change_management/stakeholder_change/stakeholder_c
hange.htm [Accessed date 28 October, 2014].

Dean, C(2009). RIMER Managing Successful Change. Australia: Uniforte Pty Ltd.

Kotter, J. (2011). "Change Management vs. Change Leadership -- What's the

Difference?". Forbes online. Retrieved 12/21/11.

Lewin K. (1943). Defining the "Field at a Given Time." Psychological Review. 50: 292
310. Republished in Resolving Social Conflicts & Field Theory in Social
Science, Washington, D.C.: American Psychological Association, 1997.

Scott, W.R. (1981). Organizations: Rational, Natural, and Open Systems. Englewood
Cliffs NJ: Prentice Hall Inc.

Schultz & Schultz, D. (2010). Psychology and work today. New York: Prentice Hall.
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Value Based Management.(2011)Pettigrew dimensions strategic change

[Online].Available
at:http://www.valuebasedmanagement.net/methods_pettigrew_dimensions_strategic_change.
html[Accessed: 21 August 2014]

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Vroom, V. and Sternberg, R. J. (2002). "Theoretical Letters: The person versus the
situation in leadership". The Leadership Quarterly 13 (3): 301323. doi:10.1016/S10489843(02)00101-7

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