Case Study: Martys Shoes Introduction The idea of this assignment is to learn how to write a business change plan

on the basis of a case study. This plan will appeal greatly to your knowledge of advisory skills and skills for the management of change. Solving the case contains specific Extended Enterprise elements. This puts the content of the course in the context of this semester. Case description:

Martys Shoes Ltd.

Martys Shoes was founded as a factory in 1948 by Mr. L. van Leer, the father of the present managing director, Mr. S. van Leer (61). His company now has 175 employees. The managing director of Martys Shoes is locally and regionally well-known as Sijmen van Leer, who plays an important part in public life next to his position as managing director. With respect to the situation in the shoemaking industry, Sijmen van Leer uttered some quite positive remarks in a recent interview with a regional newspaper. Some weeks later Mr. Van Leer received the preliminary annual financial statements of his company. Bearing in mind the upcoming presentation of the annual figures, his accountant wrote an accompanying letter, concluding that profitability has sharply decreased over the last couple of years. This is caused by a greater increase in expenditure than in turnover. The quality of Martys Shoes products is high. Traditionally shoes are to a great extent manufactured manually by professionals who have worked for the company for many years. Martys shoes experiences stiff competition from China and Romania, countries that used to produce inexpensive bulk products, but that are increasingly shifting to high quality footwear. These competitors are able to produce at lower cost: their wage-levels are lower and, contrary to Martys Shoes, they use the most recent techniques. Apart from 2008, Martys Shoes has not made any investments over the past five years. There is hardly any increase in production. By now some 30 % of the turnover is exported to foreign countries. Sales are conducted in a pattern that has been similar for many years. The number of retail traders is decreasing. The trend is towards bigger retail chains, with more buying power and the rise of internet retailers. The figures do show, however, that Martys Shoes solvency is quite good, due to continued pay-off of debts. Yet, the question is to what extent failure to invest influences the results, the accountant concludes. Mr. Van Leer meets with the general management staff of the company every two weeks. Next to the managing director they are: Peter Nagel (48), head of the administrative department, originally employed in the accounting department. Nagel has been working for Martys Shoes Ltd. for many years and is responsible for all administrative affairs, although he and his department have relatively little personal contact with production and sales. Wim van Tongeren (53), head of HRM (Human Resource Management). In his younger years he started at Martys Shoes as a production worker, left the company for a couple of years to study psychology, and on his return worked in the HRM department, of which he has been the head for the past two years. Elsbeth IJser (40), production manager. She has also worked for Martys Shoes for many years. She is also responsible for the design department, with a couple of budding designers. She consults with the head of purchasing and sales on a weekly basis and is worried about the declining number of orders. She knows that the cost of production is too high when compared with competitors, but is hesitant to move production to low-wage

countries in view of the possibility of loss of quality and labour force consequences. Felix Voeten (29), head purchasing and sales. Voeten joined the company only three years ago. He has recently taken up part-time courses in Business Engineering at Hogeschool Utrecht and is interested in applying the insights thus obtained, by proposing all kinds of improvements. It is frustrating to him that his suggestions are barely listened to. Mr Van Leer personally takes care of a great number of external contacts and hardly concerns himself with production and sales. Generally speaking, Martys Shoes Ltd. Favours a system of internal career-planning. Employees need to be familiar with workmanship in order to be eligible for a managerial position. The employees average age is higher than the average age of the national working population. Company loyalty, great job continuity, Martys Shoes breathes a family atmosphere. The companys reputation in the area is outstanding. ICT in the company in so far as it is present - is rather incoherent. Book-keeping is done by means of separate accounting software without modules for invoicing or goods in stock. In his accompanying letter regarding the preliminary financial statements, the accountant of Martys shoes wrote: '.....not quite in line with the positive purport of your recent interview in the Brabantsche Gazet, the financial statements indicate a result which has significantly fallen short of the budget estimates. We remind you that we have reported this earlier in our interim surveys. Moreover the declining results of the past few years show a pattern of continued and accelerating decrease. In this connection we refer to previous discussions of the declining results, in which we have repeatedly suggested a screening of your company by our advisory department for organisations. The draft financial statements are discussed in one of the regular staff meetings. The production manager and the head of purchasing and sales realize that the company is not doing well. Taking the accountants letter as their starting-point, they attempt to convince the managing director that change is essential. Voeten suggests moving part of the production to Romania or China. At the moment part of the production in the Netherlands leads to serious losses. Particularly the shoes that are manufactured through the so-called Goodyear principle. This part of production results in a loss of 800,000. There is a high-quality factory in Romania which is able to reduce the production costs by 1,200,000. China is also a possibility. They can even reduce the costs by 1,600,000. However, the time of delivery will increase, there will be less grip on quality and there are questions with respect to sustainability. Voeten suggests moving part of the production to China. This will be tremendously cost efficient. Under his studies Voeten visited a shoe manufacturer in China last year. (The situation which he encountered there resembles that of the Chinese textile works in Prato, from the China documentary of Tegenlicht, broadcast on 9/10/2005, available from the Business Engineering archives). This outsourcing proposal is way too much for the managing director. He professes being open to change, but this should be based on the core qualities of Martys shoes. Inexpensive production in China is not part of that. Mr. Van Leers secretary, who takes the minutes of the meeting, modestly points out that working conditions in the Chinese shoe and textile industry are quite poor. Voeten says that he does not pursue a situation of exploitation of people, and poor working conditions, but that this is about survival. Wages in the Netherlands are too high for the production of shoes. This does not only show in a comparison of wages, but also in the behaviour of Dutch shoe manufacturers. In so far as they are still in business, they have moved or outsourced their production to countries such as Romania, Portugal, Tunisia, India. We simply have no choice. And even then it will be difficult to survive, since shoes are increasingly sold through other

channels than the traditional ones. Take the United States for example, where Zappos, an internet company, more or less controls the shoe manufacturing industry. Is this what we want ?, he desperately wonders out loud. It is better for the community to retain something, rather than wait for a bankruptcy of the company. Of course this requires an effort, of course our employees and our community will take it ill, of course we take risks in terms of quality and we will be faced with a lot of questions that we do not have the answers to, but it is better than waiting for an inevitable bankruptcy. We should at least try something. Mr. Van Leer is impressed by Voetens argumentation and commitment, but he remains silent. Nagel does not take part in the discussion. He requests to be excused: one of his subordinates makes mistakes in the way invoices are fed to the computer software. He is determined to solve this problem as soon as possible to avoid possible chaos in the near future. The managing director nods by way of consent. In the silence that follows, Elsbeth IJser suggests asking for external advice. An external expert will look at the company with new eyes and may be better equipped to assess the situation. The managing director considers this a waste of money: he fails to see the need. Eventually a compromise is reached: there will be an external analysis, but this will be carried out by students, so as to constrain the expenses. Voeten offers to approach one of the teachers of his part-time training programme. While the head of acquisitions and sales consults with Mr. Goedegebuur (Business Engineering), managers of three other companies contact the managing director of Martys Shoes almost simultaneously: The American internet company Zappos.com is a tremendously successful and powerful company. Young and dynamic. They sell all sorts of shoe brands on their website. They would like to include Martys Shoes as a quality product in their Dutch branch. Experience in other countries has shown that this could result in 25% growth of Martys Shoes total turnover. Of course they demand much higher margins, than traditional retailers. Linebalance Company, a shoe manufacturing company to be established, has invented an entirely new concept: shoes with a kind of barcode on the side, which can be adapted to the wearers wishes. The idea is to develop a universal code that enables the wearer to express being in love, in a good mood, open to romantic encounter etc. The manufacturer aims at a younger crowd with quite some money to spend. Linebalance has two founders (39 and 45). One of them comes from the world of sports. The other worked for a supplier of clothes and footwear for the military for many years. They met during a sporting event for soldiers in Iraq and developed the idea of doing something with sneakers. After some brainstorming sessions they decided that the barcode was the most promising concept. Linebalances office is based in Amsterdam, with three employees. Production is outsourced to a manufacturer in China. However, Linebalance is not satisfied with the quality of the supplies: the production of the barcode sneakers results in technical problems. They have also heard say that Martys Shoes has two budding designers who would not mind spreading their wings. Linebalances management would like to make use of the expertise of Martys Shoes craftsmanship and requests an appointment with Mr. Van Leer. A major Dutch retailer with various branches throughout the Netherlands with a 5% share of the market may be available. The company is owned by a family that lacks a successor. 30% of their sales concerns quality footwear of Martys Shoes. Since a number of so-called flagship stores have become operational in the major cities, this would be an opportunity to rapidly create a network of their own company stores. Next to all this Mr. Van Leer receives a telephone call from his bank. This concerns the

following: In the shoe-manufacturing industry, which is mainly concentrated in the province of Noord-Brabant, Van Dommel Shoe Manufacturers (since 1734) is active on the market next to Martys Ltd. The two companies are only a distance of 15 kilometres apart. The companies are about the same size. Van Dommel has 85 employees and Martys Shoes 175. The two companies happen to conduct their business with the same bank. The managing director of the bank is well aware that the companies are losing their share of the market. The banks claims are not in danger with either company, but employment in the region is a matter that the managing director of the bank, born and raised in the province, feels strongly about. He plans to sound out the two managing directors individually on the feasibility of a merger or some other type of cooperation. The managing directors decide to meet for a discussion, which leads to the following: production will have to be concentrated in one industrial building. Also, circa half of Martys Shoes employees will have to be laid off. These are essential conditions formulated by Van Dommels managing director. In essence his proposal boils down to a takeover. Van Leer does not make any promises for the time being. He first wishes to deliberate with his staff and shareholders. Information from a first round of interviews with Business Engineering students: Sijmen van Leer Welcome to Martys. I wish you a pleasant time here. Have you been on a guided tour yet? No? Well, we must definitely take a stroll through the production hall later. You will see that craftsmanship is a keyword here. The smell of genuine leather is present in every corner of the building. We are in fact one big family. Most employees are really experts; many of them were trained here in the company. Professionals, thats what makes or breaks a manufacturing company like ours. We produce footwear of the best quality in the Netherlands and we are also successful abroad. Most employees are proud to be working here and I am proud that they feel comfortable and at ease in their work. We have been in business for over 60 years now. Many competitors have had to give up in the meantime. We have survived, because we do not set our sails to every wind, but we work from our own strength: professional craftsmanship. The pricing of our products is fairly high, but that is not a real problem: there are always people who are willing to pay for a good product. Thats the reason why I dont go for all kinds of trendy proposals. A couple of years ago we were advised to invest in ICT, and to purchase an Enterprise Resource Planning System. I blocked that. Its not that we dont have the money for it or that we are old-fashioned, but it leads to burdening people with working procedures and to lack of personal contacts. That does not fit in with the culture of our company. Moreover, everyone knows that systems like those sometimes break down for many hours and then youre in big trouble! And now were faced again with a number of wild plans: outsourcing, internet sales, something with barcodes. Im really against this, why follow the crowd in every whim they can think of? Production in China! I recently saw an awful documentary - my secretary Yvonne pointed it out to me on how they treat their workers! Im a devoted Catholic and I just cant reconcile that to my conscience. Those ideas are put forward by Felix Voeten, our marketing guy. He is married to my wifes daughter from her first marriage; three years ago he was looking for a job and I thought that the sales management department would be alright for him. But he is still inexperienced and needs to learn how we organize matters here. So, dont let him talk you into all sorts of things. Actually, I dont quite know what you are planning to look into, but Id say: look around a bit. Smell the atmosphere and the leather ha ha- its always exciting to take a close look at a production process that runs smoothly. You can ask everyone questions. But we dont supply financial data just like that, were quite cautious in that respect. By the way, the president of the Workers Council has indicated that she would like to meet you. Shes called Petra sorry, I dont recall her last name at the moment but she has worked here for many years, a wonderful girl, and of course its great for her to be the first female president of the Workers

Council. So do her a favour and drop by at some point. What I think of participation in decision-making? Well, its part of the game, right? Its laid down in the law. But its actually not necessary here. As I said: were one big family. If someone has a complaint, the door of my office is always open. And finally: contrary to what I mailed to you earlier on, your host in the company wont be Mr. Nagel. Hes too busy running his own department. Unfortunately Im not available either: Im regularly away and out of reach. Ive asked the head of our HRM department, Mr. Van Tongeren, to take care of you. Hed be the right man for it, I think. So, ladies and gentlemen, shall we go for a guided tour of the company? Come along please. Wim van Tongeren Welcome! You have already been shown around? Good. And whats your first impression of our company? How do you like the atmosphere? You will probably have noticed that most workers are no longer in their prime, myself included, I must admit. That is something to keep in mind when you start making recommendations. Look, we are a sort of family business and honestly speaking we havent kept pace with the times in all respects. But colleagues work together quite well. We stand out from our competitors by our high quality products. Everyone working here is well aware of that. Business Engineering, what exactly is that about? Oh, improvement of processes? Well, yes, I guess theres some room for improvement at Martys. But be careful in terms of the consequences of your suggestions: you cant just introduce an ERP-system overnight. There will be no end of resistance to that. Were dealing with professionals, who love working in their trade and dont want to feed data to computers or stare at screens. New procedures require a retraining trajectory. But I admit that I do see an advantage if we were to introduce that sort of changes: it would be a long-awaited opportunity to start working systematically on the development of competences of our employees. So, its not impossible, but you need to pay attention to material and immaterial working conditions - security for elderly workers and that sort of thing. And if youre going to lay off people, there has to be a solid social plan. If not, a trajectory like that will ruin the atmosphere in the company. So, the key question is actually: how can we introduce change, without doing harm to the loyalty and team spirit of our employees. And what will be the effect on our image here in Brabant? The moment we lay off people, the media will be on our doorstep in no time. But I do worry about the age ranges. Another key question is how to attract young people, without losing our most important values. And what kind of tools are necessary in such a trajectory of change? Have you learned anything about HRM in your Business Engineering courses? Change management? Ah, thats good! But remember, dont get stuck in the theory, practice is often tough and persistent. Changing procedures may seem OK, but if you dont win the hearts of our people, you dont achieve anything at all. Oh, and it would be a good idea to talk to the president of the Workers Council. Shes a clever girl, but she cant stand up to the managing director very well. Oops, maybe I shouldnt have said that, better leave that out of the minutes. Anyway, you have to judge for yourself. And if you have any questions, you know where to find me. Good luck. Peter Nagel Sit down please. Im a little pressed for time; you dont have too many questions, do you? Its always quite busy here, we are actually like a spider in the cobweb between the various departments. Id be inclined to say: this is the most important department of the company. A spanner in the works here, and everyone else has had it ... I heard about the plans for change, but I dont believe in them. Neither does Sijmen, fortunately. He has a firm hand at the wheel. So, if I were you, I wouldnt lose myself in outsourcing and that sort of nonsense, but Id focus on a proper description of the production processes. And on the basis of that you could

perhaps write a procedures manual yes, thatd be a good idea! That would really be a helpful contribution. There are a lot of people who still dont know the procedures very well, or try and do the work their own way all the time. Let alone when we get new people here in due course quite some people will be pensioned off in the years to come. Those newcomers dont know anything at all. A procedures manual would then come in handy, saves us time to explain everything over and over again. As I said: its always busy here. Elsbeth IJser Do come in, wait, Ill fetch a couple of extra chairs. Nice to meet you. Im quite happy with this screening: its always sensible if someone takes a fresh look at what were doing here. You have been shown around, havent you? Well, what do you think of our company? Isnt it great, all this handwork; I was more or less raised here, my father also worked in the factory, always the smell of genuine leather. And we have wonderful professionals, who also work together very well, a really good team. But I do worry about the changing market. Orders have dropped to some extent recently. I myself notice it on account of our storage factor, which is decreasing, as Felix Voeten, our purchasing and sales manager, has recently figured out. Actually, we have excess capacity, but lets face it, you cant just give people the sack, can you? These people have worked here for many years. Im seriously worried if it turns out that we will need to work more efficiently: how will we treat these people? Of course we have the HRM manager, Van Tongeren. He would be in charge of dealing with them in a decent way. But I have qualms about that; when it really comes to it, he doesnt accomplish a lot, I think. He probably simply follows the decisions of the managing director. They hired him to soothe the employees when theyre getting too bothersome. I would love to find a way to get rid of our excess capacity: cooperation with the barcode manufacturer, or sales through internet - or whatever. As long as something gets going. Of course were willing to change. And its nonsense to think that elderly workers cannot learn new skills. My people are quite reasonable, as long as you explain what is needed and why. I see your inquiry as an opportunity to make changes. The mere fact that youre here is significant. I hope that you can convince the management that a change of course is called for. You know, when I say something, they only listen politely. But a research evaluation report, supported by theory and the like, thats something they cant ignore! Please keep me informed of the direction in which things appear to be moving. Then Ill see if its at all feasible. In daily practice Im the one whos more or less in charge in the company, together with Felix I determine what happens. And thats how it needs to be, otherwise nothing would happen. But we cannot push for major changes: then the management will thwart our attempts. Notably Nagel youre aware that his name is Dutch for the word nail? Well, hes a nail in my coffin, as we say here. The man is still living in the past century. So, it is not that we dont want change, they dont! If we come up with a business change plan, well have to consider carefully how we can pull it off. Will I hear from you soon? Wonderful! Cheerio! Felix Voeten Hi! So you guys are from the Utrecht full-time training programme. Come on in. Well, what do you think of the assignment? Oh, youre still in the exploratory phase. Is Goedegebuur still working there? Yep, he was elected teacher of the year when I was there. Nice, he deserved it; he was a good teacher. And is Greve still section coordinator? He isnt? Someone else again? Well, well, lots of swaps there. But down to business. You havent come here to listen to oldtime stories. I have now worked here for three years, and between you and me: this is an outdated old boys club. Everyone does their own thing and the managing director keeps himself to himself. It is actually a miracle that were still in business.

Have you seen the massive amount of work in progress in the production hall? Costs a fortune! I have suggested to Elsbeth to take a close look at the production processes and to do a bottleneck analysis. I think that the existing capacity could be used much more efficiently. Too many people hanging about when the machines need to be changed over. Total lack of efficiency. We could lay off at least fifteen workers. Definitely, if we start working in shifts. Elsbeth seemed to agree with me, and next you hear nothing. And Van Leer just says that production is not my responsibility. `Shoemaker stick to your last, ha ha. Have you heard that chuckle of his? There is really nobody here who has the faintest idea of changes in the market. Well, OK, Elsbeth to some extent. Not my own people. They only deal with the same old retailers that theyve dealt with for years. Old fogies, thats what they are, hard to control, unwilling to accept leadership. You need a lot of patience with them, Ive learned as much as that. Just like everyone else they do everything their own way; an up-to-date approach is simply out of the question. We need to adapt to the competitors in low-wage countries. They provide slightly lower quality, but at a much better price. The customers werent born yesterday! We can only survive if we move along with the market. Make everything lean and mean and outsource part of the production to China that would be my idea. If you want to stick to the current level of quality, youre talking about a niche market. It can be done, but that requires looking for sales channels where your special customers can easily find you. Internet or a franchise formula with company-owned shops I dont know. Thats up to you to think about. I look forward to what you come up with. See you. Petra Steenbeek, president of the Workers Council Hello, nice of you to drop by. I had already heard from others that there will be a screening and I thought: thats something the Workers Council should be involved in. Its odd that Van Leer has not informed us personally. But thats how it always goes: we are never informed on time. We are shown the budget estimates when everything has been solidly fixed, so our input is marginal. They usually forget to send us the annual figures. The years working conditions decree is usually presented by the end of the year. We are not at all taken seriously! As a matter of fact, Im very upset about this; maybe it does not show, but inside Im filled with rage. And now there are suddenly lots of rumours: the company is to be moved to China were going to merge with an internet company half of our production workers will have to be laid off where does all this come from? And why dont the managers speak frankly with us? Why arent the problems discussed out in the open? What problems are there in fact? Do you have any idea about that? No? Let me tell you, this place is a mess. Everybody does their own thing, everybody runs their own business; there is absolutely no coordination. What was that question? Can we work together at all? Good point. I dont know. It simply doesnt happen. At least not between the departments. I guess on a departmental level, yes. Van Leer isnt here most of the time, and he hasnt got a clue of whats going on. Elsbeth is more or less in charge, together with the sales guy. Nagel? He only leaves his office when a bill of lading has been mislaid, or when someone has made a book-keeping error. And then there is Van Tongeren of course. No idea what he actually does, payroll administration or something like that. Its actually no wonder that were so badly informed. But Van Leer makes a mistake if he thinks that he can just shove us aside. There a great sense of solidarity in the Workers Council, even if all of us represent different departments. Yesterday I gave my contact at the Trade Union a call. Tomorrow well have a meeting with the managers and well demand full information on the state of affairs. And this time we wont be told off. If they dont come up with something soon, well mobilize the union. Just wait and see who draws the short straw! What I was going to ask you, could you come to a meeting of the Workers Council and tell us

what your analysis is all about? Say in one or two weeks time, as soon as youll have finished your preliminary inquiries. Would that be possible? OK, great! Our secretary will send you an invitation. I really look forward to that! See you in two weeks time. Assignments Meeting 1 (week 2); Situation analysis Read the case thoroughly and answer the following questions: Define the actors and their role What are the triggers for change What is the context of this situation What is the philosophy of this situation Defining its change idea Present the outcomes in a PowerPoint presentation Meeting 2 (week 3); Diagnose the present situation As of this assignment you will have been assigned a colour of change by de Caluw. By identifying with this colour, you will look at the case study with this special focus. The yellow agent only sees politics, power play, coalition building etc. and only has yellow interventions and diagnostic instruments at his or her disposal. Evidently the solutions of the problem will thus be yellow-oriented. Before continuing, you will therefore need to know what colour determines your outlook on the case study. What is going on here. Use the theory from Learning to Change for a proper diagnosis. Include in this: Context of the change (Environment, Situational Cause, Philosophy) The concept of the business change plan Diagnosis (use 2 models) Determine the core issue of the problem Meeting 3 (week 4); Consistently incorporate your own theory in your business change plan on the basis of the assigned colour Develop your own theory based on the colour assigned. Use in particular: Worked out colours and the theories mentioned there from chapter 3.3 Instructions from the lecture Tables 3.1, 3.2 and 3.4 from the book Words and sayings by colour from appendix 1 Meeting 4 (week 5); Write a business change plan On the basis of the assigned colour you will write a business change plan, which consists of three interventions from chapter 7. Evidently, the change plan should account for the solution of the core issue of the problem as formulated in meeting 2. Meeting 5 (week 6); Presentation of the business change plan Make a PowerPoint presentation of the diagnosis and the business change plan, present it to your fellow students and defend your work.

Martys Shoes case

INHOUD
1. Background................................................................................................................................................... 11 Actors and their roles ....................................................................................................................................... 11 History of the organization .............................................................................. Error! Bookmark not defined. Triggers ............................................................................................................................................................. 12 2. Theory .......................................................................................................................................................... 13 White Thinking .................................................................................................................................................. 13 3. Diagnosis and Intended Outcome ..................................................................................................................... 14 4. Strategy ............................................................................................................................................................. 18 5. Intervention plan ............................................................................................................................................... 18

1. BACKGROUND ACTORS AND THEIR ROLES

Initiator The one with the idea Felix Voeten

Sponsor- Has been approached by the initiator for legitimizing the idea Managing Director

Supporter informal supporter Managing Director Peter Nagel

Champion Formal supporter Elsbeth Ijser

Implementer Whos makes the change Wim van Tongeren Students

Change victims All employees

Orchestrator Students

Context
The Shoemaking company is founded by L. van Leer in 1948. It has been directed by S. van Leer for many years now. They deliver high quality shoes. Theyre market is focused on the Dutch market. There are a lot of different competitors, which are shifting their production to countries with lower wages. The organization characterizes a family culture which is very stable but not flexible.

TRIGGERS CHANGING MARKETS

In last couple of years, the retailers have been decreasing. Next to this trend, the power in retail chains is growing heavingly. Internet sales are increasing. All of these trends (triggers) are heaving a tremendous effect on the financial base of Martys Shoes.

FINANCIAL
Because of the changing markets, the profitability of Martys Shoes is decreasing. On top of that, the production costs are getting higher but the revenue is stable. Also the bank director is aware of these changes. Therefore he is demanding a change.

INTERNAL
Production is stabalized by the company. They havent increased it over the last years. The middlelayer management is build up from several production workers. They dont have any management skills.

EXTERNAL
The competitors are producing in countries with lower wages. Also theyre production strategy is shifting from bulk to quality.

2. THEORY WHITE THINKING IDEA OF THE CHANGER

Letting go and loosen up. Discovering patterns and meaning. Running the blockades Creating creativity Optimizing conflicts

A WHITE CHANGE RESULT

Unpredictable, predicting the route is not relevant. Now is important

RESULT DEPENDS ON
What people wish and dare to do, their creativity. The level of self-organising. By accident will be taken seriously.

MEASURABILITY
On evolution. Different order of working. Adaptive working.

THE ROUTE..
Studying the organization in the dynamics of the surroundings. Analyzing of patterns and breaking them. Moving, interacting, acting.

TYPICAL WHITE HANDLING

Giving space, dynamizise. Personal grow, Taking away pressure. Autonomous teams.

KEEPING ON TRACK
Facilitating the process by giving feed forward and meaning.

TYPICAL ACTORS
All that are involved. Its not always clear who the initiator is. Subject & object are falling into one.

PLAYGROUND
Complex. Non-linear. Order and chaos. Experimental, creative and moving.

SECURING THE CHANGE

Autonomous teams. Giving meaning and responsibility.

White change idea Martys Shoes

3. DIAGNOSIS AND INTENDED OUTCOME THE CLOCK

The clock moves between 11 and 12o clock. On 11 till 11:15, the company is healthy, wealthy and ready to invest. The markets are growing. The atmosphere is full of hope and enthusiasm. Everything the company touches changes into gold. Finances are not that meaningful. From 11:15 to 11:30, the company is still pretty wealthy. The grow from the first 15 minutes lead to the need of coordination. Most think there is too much chaos. Different departments are created for finding order in the chaos. Processes are streamlined and optimized. When its half past 11, the company is not flexible enough anymore to adjust her goals to the changing markets. Financial, they arent stable anymore. There has to be order in the company. Re-organization is a must at this point. Changes in portfolios should be considered, dysfunctional employees should be cut loose and communication should be updated. When a company does not react in an earlier stage, the clock will be set to 11:45. In this stage, the conflicts will grow and will be visible for outsiders. This wont work because the collaboration and competences arent good enough. There are just a handful of solutions. The motto in this scenario is: double or nothing. Everybody has to cooperate at this point to make it work. If it doesnt, its still possible to start over again with just a few elements of the company. Marty Shoes

The company is currently at the point of no return. They have to make a choice and changes. The profit is going down, IT-systems are full of bugs and there isnt any conflict what will lead to lack of creativity. De need for change is high, but the devotion for change is low. This is a so called alcoholic scenario. Often is this scenario, the people arent used to change. Theyre used to a traditional way of working.

Optimal conflict level

In this typical white model its very easy to generate your companys level of creativity. Conflicts genuinely have a negative name. A conflict is something you better avoid. In this theory conflicts are necessary to create tension. Tension is needed for creativity. Explanation of the model: The model as Vanderdriesche created in 1996 is a simple and understandable for everyone. Lack of conflict leads to lack of creativity. This because there is no pressure for higher targets and evolving. Its very important to keep growing, and keep sharing thoughts. Talk and share. Marty Shoes Marty Shoes is momentarily at a point of no conflict. People arent talking to each other between different departments. There is a little bit of communication, but a lot more rumors. Employees are hearing different stories about moving the production to china, letting go of employees and merging with internet companies. When Martys Shoes creates a open environment, the possibilities will open up for more creativity and brainstorm sessions. The production workers dont have any influence on the decisions taken by management. There should be more room for influence and solving from the bottom down.

Finding both models for causal model No urge for change No room for conflict Lack of energy for heroes to proceed Old-fashioned Many blockades Lack of trust Decreasing profit Bugs in IT-systems

CAUSAL MODEL

Creativity
Solving Blockades

Energy

Space

Conflict

Positive feedback

Generate time & space

Inform on change

Horizontal organization

Responsibility

Trust

Self-adjusting

Autonomous teams

In the model above is visible that there are different factor affecting the creativity within Martys Shoes. These factors are controllable. When starting to control the different factors, it will be effecting the creativity. What the most important finding is in this model, is the blockades. When blockades are being relieved, people will start to understand they can start using their creativity. The three yellow findings: energy, space and conflict are needed for increasing the creativity. They all lead to solving personal blockades. To create space, energy and conflict, steps need to be taken. Therefore its important to generate these factors. How to create them is the next step in the causal model. First people need to be informed on the changes and what for the change has to be taken. Informing the employees will give them a certain understanding for the change. This

understanding is critical for creating creativity. Next to the informing the workers have to be able to get more energy for sharing their thoughts. This energy can be created by giving them more positive feedback. This feedback is given by the manager. When creating a more horizontal organization, employees will start to operate in a more autonomous team. This will result in more trust, space and a self-reinforcing circle. Based on the story above, the following outcomes have been created:

give the managers the white mind set make the company managers understand that change is necessary for future success increasing creativity, conflicts, energy and space in a company to achieve new solutions and innovations

creating more horizontal organization and creating self-steering teams by giving common trust, responsibility, time and space between managers

In a long term view managers should also share their new knowledge and white thinking among staff members

4. STRATEGY
The main result of the change is to give the directors and managers a new mind set, a new way of thinking.

ARGUMENTATIONS
1. If they use a white thinking in a company to increase creativity, energy, conflicts and space, in future changes can be seen as positive things and maybe they even try to find possible targets of change. At the moment the directors and managers do not realize that chaos and conflicts are key elements in finding new solutions and to gain competitive advantage in future. If the managers give employees space, responsibility, feedback, run blockades and create common trust, the outcome is more horizontal organization. Then it can even to lead to self steering teams. Managers will get a better understanding of a whole situation, when people are understood and listened and have courage to bring out troubles and problems they have. When organization is horizontal, people feel themselves appreciated, trusted and important. It will lead to a better motivation and they feel free to express themselves and are more passionate in their work. This increases creativity and we can expect new innovations, which is crucial for a traditional company like Marty Shoes to succeed.

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5. INTERVENTION PLAN Marty Shoes is in a really difficult situation. Companys profit has decreased because of changed retailers, customers and way of production. Change in a company is needed, but nobody is either willing to change or believing in success of a change. With white thinking change is still possible if they take a right direction and focus the change for a certain people in a company. In this case we think that the directors and the managers are those certain persons which need to change in order to turn the company profit loss around. First we need to start the change with a green color, because the directors and the managers need to be taught how they will work with the white color mindset and what are the key elements in that for a successful results. INTENDED OUTCOMES give the managers the white mind set make the company managers understand that change is necessary for future success increasing creativity, conflicts, energy and space in a company to achieve new solutions and innovations creating more horizontal organization and creating self-steering teams by giving common trust, responsibility, time and space between managers
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In a long term view managers should also share their new knowledge and white thinking among staff members

ACTORS In white thinking the roles in a change process are not defined very specifically. All group members have shared responsibility and it is very important that they discuss and the decisions are done together and with common understanding. People who will take part in a change process are:

manager director Sijmen van Leer head of the administrative department Peter Nagel head of HRM Wim van Tongeren production manager Elsbeth IJser head purchasing and sales Felix Voeten

PHASES We start using the green color and give the participants a training about white color thinking and white way to do changes in an organization. This is ran by consults who have special knowledge about white color thinking and white way to do changes in an organization. Estimated time is 2-3 weeks and some sort of monitoring test will be made after the training period. There is three 2-hour sessions in a week. Meetings with brainstorms will be scheduled every week between all of the managers of every department. Meaning of the meetings is to share information of what is going well, which sector has problems and what needs to be improved. The meetings should be very open so that everyone will tell their opinions and thoughts. These meetings are supposed to be continuous. Managers are supposed to create the same white color thinking culture to their staff. Departmental meetings will be also scheduled to discuss about those same issues among employees. This way the staff will feel themselves important for the company and they start feeling that they have more responsibility. This is the key for having energy, space and conflicts which will hopefully lead to a creativity and innovations the company needs. SENSE MAKING Normally companies who has white thinking mind set in their strategy, are very innovative, leading corporations in their industry. If there is a lot chaos and conflicts, eventually solutions and ideas come up. Motivation will increase automatically, if the people think that they need to change. People are also more creative when they feel that they are important and they have responsibility. STEERING In the beginning of the change process the monitoring and steering should come from outside consults and in the point when managers have the white thinking, then the steering should come from themselves.