Strategy into Action in organisational change
Strategy into
action
Impact
of organisational change of Nissan on its business performance and customers
satisfaction
presented
by
presented
by
LINUS UCHE
Abstract
This report was carried to evaluate the impact of
organisational change of Nissan on its business performance and customers
satisfaction. 2016 Annual report was explored to analyse the financial
performance. It was observed that the company’s business was improved after
some strategic change but not stable. Lewin’s, Kotter’s and Mckinsey’s 7s was
reviewed for critique of how strategy model affects organisation performance.
It was concluded that there is no best strategic suitable for organisation but
rather one can adopt strategic change based on company’s and environmental
conditions.
Table of Contents
1.
Introduction
Employees knowledge of current organisational cultural
change like value, leadership method, structure and system has become a
potential element of improving their working performance. Good organisational
culture motivate employees to perform their duties better, because they
understand what they are doing and feel confident for their activities (Lydiah,2014).
Organisational culture is a common belief, norm and values, that oversees way
workers act in organisation (Schein,2010). These
shared assumptions determine how organisational staffs perform their duties.
All organisation implement and uphold good culture, that acts as a guide for
their internal employees behaviour.
The essence of this culture decides the extent at
which organisational visions, goals and performance are achieved (Barney,1986).
Organisations make strategic change in their industry either to re-structure,
develop the existing culture or implement change in order to overcome certain
business phenomenon and gain competitive advantage.
To succeed in the application of strategic change, it
is imperative to acknowledge the main causes of organisational change (Abbass
& Richard, 2013). In support of this, Budhwar & Debrab (2013) proposed
five factors that trigger for organisational change such like political,
technological, cultural, environment, market and economic. The effect of the
aforementioned requires to be deliberated in the perspective of organisational
change and structure (Richard, 2015). This makes it obvious that organisation
is likely to adapt business problems. Repaid growth of business environment
leads to the need of organisational changes such as transformation and
improvement of brands as a result of diversification (Alvesson &
Sveningsson,2015).
2.
Organisational strategic change
Therefore, the purpose of this study is to examine the
impact of organisational change of Nissan on its business performance and
customers satisfaction. With motive of strengthening Nissan business
performance internationally, in 2014 the company started its strategic change
by appointing new manager in Africa, Middle East and India. They believed that,
good management in different region will enhance more focus on guaranteeing
consumer’s satisfaction and improving their brands. In order to play a vital role
to improve Nissan brands in the largest market, they also engaged in joint
venture strategy with other regional industry such as Khaled Juffali company
Saudi Arabia and Renault-Nissan BV France.
3.
Literature Review of strategic change
and organisational culture
The effective
sustainability of organisational culture and the demand for organisations to
control the strategy of their company in order to accomplish strategic change
has become core principle for managing organisation to maintain the change for
long-term achievement (Lewis, Passmore & Cantore, 2016). In order to
achieve efficient and effective results, organisation make steady change to meet
up with update business activities (Bob & Ron,2004). This involves
procedure of upgrading or re-assigning of workers to improve business
activities. Strategic change have a great influence on the style company’s
operate business and the way organisation have been structured (Kipping &
Kirkpatrick, 2013).
In selecting
approaches to strategic change, Nissan adopted both revolutionary and evolution
change process which are; descriptive and emergent approaches in order to
improve business performance and customers satisfaction. Descriptive approach
describes organisational objectives in advance and set vital component prepared
before the execution of strategy (Belias & koutelios,2014). Equally, it
enables organisation to carry out variety of business assessment process by
Wheelen & Hunger. For instance, Lynch (2015), outlined five prescriptive process
of strategic change which include environment, internal scanning, strategy
formulation, evaluation and control. The outcome of this assessment provides a
bigger picture of organisations purpose for change, area of change, and
mission, objectives to improve performance and customer satisfaction.
Whereas, emergent
approach is the opposite of descriptive as its strategic change do not define
organisational mission but intent to enhance on the process of its existence as
the method progresses. According to the research emergent approach based on
assumption that creating and adopting new strategic change should not only be
applied in serious conditions but persistent and continuous method. Exploring a
change model with this strategic is based on the belief that strategies need
should be made from organisational responses to specific condition (Humbert
& Marcus,2016).
Bob et al (2004)
proposed that, organisation required to balance prescriptive and emergent
strategic change process. The authors agreed that, revolutionary appears to be
in radical means, whereas evolutionary will gradually reserve for small-scale
operational process. In the light of
this strategic change, Nissan implemented it and achieved continuous increase
in their business selling performance. This shows that customers are highly
satisfied with their brands.
4. Nissan Annual report 2016
Net Sales Operating Profit Income Net
2011-9409.0 545.8 341.4
2012-9629.6 523.5 342.4
2013-11434.8 605.7 389.0
2014- 13365.6 718.6 457.6
2015-12189.5 793.3 523.8
These evidence
indicates change theory helps organisation to create more value for income and
guide organisation towards its achievement of future goals. This agreed that,
revolutionary and evolutionary change collaborated to produce positive outcome,
emergent change will get to certain limit without descriptive innovation and
without radical change the potential generated by descriptive strategy will not
be successful (Bader,2016). In spite of numerous challenges in automobile
industry with risk both expected and unexpected, this strategy helped Nissan to
create a net profit of 15.4% from previous year income, while operating profit
improved 10% which made it to stand on
top among international automakers.
On the other hand,
literature have clarified that prescriptive change make organisation problem
clear and understandable but member cannot understand a way forward for success
(Garry, Richard, Kevan, Duncan, & Patrick, 2014). This causes more pressure
for organisation change. It seems to be obvious that companies require to
utilise its ability to build up current culture in order to attain and gain
competitive advantage. This is in line with conclusion of Garry et al (2014),
there is need for both incremental change and exploration of new change
strategy.
Adding to this,
Light will be shed on a change model proposed by Kurt Lewin in 1950s that is
still useful for transformation of employee’s performance, abilities and
attitudes (Robert, 2008). Lewin described the basic three step of
organisational change process as; unfreeze, moving, and freeze. Xumin, Salman
& Athman (2011) advocated that, this process underpin the action industry
execute to regain its equilibrium stage. But Elaine (2007) argued that, this
“model is no longer suitable, because some organisation can manage to
refreeze”. This implies that uncertainty
of today’s business environment requires that organisations must be agile and
flexible in making change.
This accounted on
the factors affected operating results of Nissan business strategies, as they
achieved positive and negative profit on different region as shown below.
Latin America 171.
Middle East 207.
Africa 99.
Although, another
scholar also criticized Lewin’s model suggesting that the strategy cannot be
for successful, without removing the old structure (David & Stephen,2005).
In the light of this, the company marketing share could have be better in
various nations. The reason for this trend,
there are conditions organisation may desire change in align with
environment situation. Preceding to cultural change, organisation’s situation,
problems and missions must be evaluated (Gustafson, Sainfort, Eichler, Adams,
Bisognano & Steudel, 2003). Most significant factor to change progress is
the capacity of the organisational strategy to meet consumer needs.
Moreover, Lewin
proposed that, to understand employee, group, organisation culture and to
maintain change, it is essential to acknowledge, plan and create the drive that
effects the intended change (Chowdhury, 2015). Kotter(1996), criticise this
model explicit that, “in today’s dynamic and constant changing environment, Lewin’s
progressive method may not be successful". On that note, he built on Lewin’s
model and came up with 8 steps process leading to change which includes;
urgency, creating guideline coalition, developing change vision, communicate
the vision, empowering, generating shot-term goals, don’t let up and make it
stick.
The ideology of
this process argues that, organisation cannot thrive to the propose of change
without the capacity to adapt continuously (Espedal,2016). Kotter suggests that,
the main change effort comprise of both small and medium level of change
management. Practical evidence of literature, observes that emergent method is
an outcome of the idea that change is unremitting and unstable practice of
aligning an institution to its varying environment (Carlo, 2012-22p). This has
made this approach known to many organisation as it identifies the point that
industries must acknowledge their internal culture and conduct to meet internal
situation (Burnes,2001).
However, the
disadvantage of this model has been voiced out by Eshleman (2016) that, missing
one among all the step or without understanding each step will disorganise the
model. According to Frahm (2016) without the step by step process that takes
place at ending part, organisation might find it difficult to succeed at final
stage. It seems to be time wasting while implementing change model (Thomson,
Rawson, Slade & Bledsoe, 2016). But, Kotter’s model concentrated to
embedding change in the culture of the organisation (Meredith,2013). It is also
viewpoint of Nissan to build on current culture in order to decrease expensive and
increase income.
Organizational
culture is the main element of the success or disaster of any change initiative.
Change ideas improved without pondering that culture always contributes to negative
results (Lakos and Phipps, 2004). Culture manipulates the behaviours of employees
within the organisation. Culture, in practices and interaction, dictates ways in
which works are done and how an enterprise react to change (Laurie, 1999). In
fact researchers of management strategies has ley more emphasis on direct
impact of Kotter’s model in organisational culture. For instance, William (2016)
concluded that, profitable change management needs share value, vision,
enhancement of a culture of appropriate shared values that match the vision and
technique for change.
These findings
emphasize on the roles of an organisational leader on the implementation of
change model. In respect to this, it also emphasizes the “why and how elements
of change and suggests a strong leadership role” (Andrade,2016). Effective
leader engaged in pinpointing and fostering share values (Lok &Crawford,
2004). In addition to that, Pollack & Pollack. (2015) stressed that, shares
valued are the major factor that contribute to solid organisational culture. To
modify this debate, Tom Peter and Robert Waterman as McKinney’s consultant
group, identified 7s model, which they believed that, collectively decides how
organisation can be operate(Nova,2007). This 7s includes: shared values,
strategy, structure, systems, style, staff and skills. Peter & Waterman (1981)
argued that, good implementation of strategic change did not only base on the
communication of strategy with organisation structure but greatly relied in the
interaction of 7s elements.
It implies that, no dominant element in the 7s,
meaning that any element can directly influence any other elements (Payette,
2016). For instance, strategy can impact on style so as other factors
interconnected to improve performance. In regarding to that, Naipinit, Kojchavivong,
Kowittayakorn & Sakolnakorn (2014) suggested that,7s enable managers to
diagnose and identify unproductive organisations, as it merges hard and soft
element. Looking at organisational culture of Nissan, and view point of 7s
model. It can be concluded that, this model promotes Nissan employees’
motivation. This is because, Nissan strategy provides clear role of top
management in facilitating high motivation in workers. In responses, employees’
development is rewarded and organisation ascertains its tangible profit (Manzoor,
2012).
The functional elements of this model requires
effective internal interaction to improve and maintain a competitive advantage
for institutional performance and development (Singh,2013). The scholar,
believed that, transformational form of leadership has great impact on the
workforce and organisation’s culture. The overview of this statement, draw
attention on the important of adopting management styles that, must strategically
aligned with organisational culture, needs and strategy plans. According to
Belalcazar & Diaz, ( 2016) for organisations to effectively implement and
carry out strategy action they have to attain strategic alignment. This is to
show that strategic alignment adds to the value of strategy organisation instigate (Zouaui,
Triki & Ferchichi,2016).
5.
Conclusion
In the overview and evidence of this research, it
seems that there no specific strategic change model appropriate in addressing
organisation’s circumstances. In terms of organisational change management,
Lewin’s, Kotter’s models and Mckiney’s 7s was proposed which undergo various
steps to be implemented in organisation. But the problem is that, change is
inevitable and unpredictable neither is in linear occurrence.
Having said that, what has to be applauded is the way
in which the management adhered to the implementation of change. Nissan started
with radical approach by appointing new manager in different nations and join
venture but merge with incremental approach of management. The outcomes of
models discussed above shows that, organisation can achieve continuous
competitive advantage by been flexible in strategies to match with particular
situation.
6.
Reflective Report
Strategy into action study was formulated for doctor
of business administration (DBA) post-graduated study with purpose of providing
set of managerial knowledge, skills and attitudes that enable a prospective
managers to function in organisation efficiently and effectively. The main goal
of this module is to assist students gain in-depth knowledge on how to apply
various strategic change model in a given organisation, as well able to align
it with organisational culture. It encompasses of lecturing activities and
brainstorm of companies case study, in order to improve strategic thinking and
able to suggest suitable model into action.
The tutor adopted complete strategy for lecturing the
whole content of the course. On that note, I achieved the learning objective in
effective way. In SIA, I carried out two research study as part of the module
assessment and it consisted of critical evaluation of consultancy report and
critique of preferred literature on strategic into action. Both assignments was
so interesting and challenging during the study.
This module provided me with clear understanding of
organisational cultural changes and its impact in promoting and improving
organisational business performance. I realised that strategic change models
and management analyses tools so effective in the context of organisational
settings. During the learning period of SIA, the lecturer demonstrated numbers
of strategic models such as Kurt Lewin’s models, Kotter’s 8 steps,
Nadler-Tushman congruence, Lippitt 7 steps, McKenzie’s 7s and Burke-Litwin etc.
Studies and practical application of the various models in my assignments have
enabled me to have knowledge on how a specific should be explored and able to
identify appropriate model for organisation.
Having understood this, some management analysis tools
which was lectured on this module like PESTE, SWOT AND Porter 5 Force helped me
to developed knowledge on internal and external forces that might influence
organisation’s performance. This course made me to understand that before the
implementation of any model, it is necessary to analyse those internal and
external factors that are directly or indirectly impact on company’s operation.
These tools also helped to know how those political, economic, social,
technological and ecological factors affect an enterprise and it should be
handled during strategic implementation process.
Consultancy report is one of assignments I found
interesting but DBA type of report was something I found challenges on the
process of writing the reports on SIA framework. But with the help of the
lecturer handling the module and guideline he provided to us assisted me in
understanding how to structured my report. Now I have improved my ability in
carrying out research in regard to consultancy report after the completion of
this course. SIA has enhanced my confident to deliver this kind of report in
any settings of business activities.
In order to identify various way of organisational
development, it is quite imperative to appreciate the work of management of scholars.
This is by making extensive research on the work of other researchers such as
suitable journal and business management text books. During the studying of
this module lecturer laid more emphasis on that, and also recommended some good
text books for me. The lecturer never seized in motivating me in researching
for good journals. This was so helpful for me and also will be a vehicle that
will transport me to my upcoming trimester and especially in my thesis.
This module deeps into the impact of organisational
culture and how it effects on employees’ and company’s performance. After
completing this course I was able to understand that organisational culture
creates sense of harmony and understanding among employees. Thereby providing
good communication and make workers motivated to abide by the regulation of the
organisation. In my future as a manager, I have learned that forming and
supporting good organisational culture is truly the most fundamental tasks for
a manager to handle.
Organisational Balance Score card, this strategy was
one of the management tools I found so interesting. With the help of SIA study
I was able to assimilate how an institution can track their financial outcome
while controlling growth in making the abilities required for progress. Now I can
easily make use of BSC if I find myself in any organisation. I can translate
their vision in such a way that, company’s strategy will be illustrated as
guide to employees. Prepare an interaction channel that will link organisation and individual goals together, help
organisation build business plan that will aid to link their financial plans
with business strategy and as well provide a solid feedback channel for
improvement.
I learnt how to manage recipients strategic change and
influencing internal stakeholders. During the classes on strategy into action
and also discussion with peers, I developed my knowledge in managing change
process and how to mitigate indirect effect to the intended change. In spite of
that, I have learnt how to identify individuals or organisation putting into
consideration in organisational change process. Using four stages technique,
for instance: formulate a plan for internal and external stakeholders, evaluate
the level of each stakeholder impact and importance. Prepare a matrix to
ascertain stakeholder impact and important and
watch and control stakeholder relationships. This is a great achievement for me.
Furthermore, navigating on the strategic change
through formal structure and informal organisation, it is very important in
organisational change management. Strategy into action has enlightened me with
the various five stages, which can be used to structure what get done, how it
will be done, the results attained and knowledge of the employees engage with
the organisation, the theoretical framework of organisation and ways of
operating and integrate extensive scope of study involving strategy and
leadership to increase proficient credibility. It has helped me understand the
full roles of organisational leadership in implementing strategic change.
Finally, strategy into action is the key module for
every DBA study because it does not only improve management skills of a student
but also help them to acknowledge the important technological innovation
skills, inter-personal skills and critical skills. At end of this course and
feedback received by the tutor, I have improved my critical thinking capacity
and analysis/critique skills of research. I believe with SIA I can perform my
duties efficiently and effectively in any organisation I find myself.
7.
Reference
Abbass F, & Richard N. (2013), strategic
management: formulation, implementation and control in a dynamic
environment. 2nd edn .Routledge, United kingdom.
Alvesson, M., & Sveningsson, S. (2015). Changing
organizational culture: Cultural change work in progress. Routledge, USA.
Andrade, M. S. (2016). Effective Organizational
Structures and Processes: Addressing Issues of Change. New Directions for
Higher Education, 2016(173), 31-42.
Bon, D. & Rob, M.(2004). Strategy process,
Context: An international perspective. 3rd edn, Thomson learning, UK.
Bader, J.(2016) Effect of strategic orientation on
organisation performance : mediating role of innovation. Scientific research
publishing, 9, 478-505.
Belalcázar, A., & Díaz, F. J. (2016). Towards the
Strategic Alignment of Corporate Services with IT, applying Strategic Alignment
Model (SAM). Journal of Computer Science & Technology, 16.
Belias, D., & Koustelios, A. (2014). The impact of
leadership and change management strategy on organizational culture. European
scientific journal, 10(7).
Budhwar, P. S., & Debrah, Y. A. (Eds.). (2013).
Human resource management in developing countries. Routledge.
Bamford, D., & Daniel, S. (2005). A case study of
change management effectiveness within the NHS. Journal of Change Management,
5(4), 391-406.
Barney, J. B. (1986). Organizational cultured: can it
be a source of sustained competitive advantage?. Academy of management
review, 11(3), 656-665.
Chowdhury, H.(2015). Applicability of Lewin’s change
management theory in Australia. International journal of management,
10(6), 1833-8119.
Carlo, D. (2012). Understanding change and change
management process: As case study
Gustafson,
D. H., Sainfort, F., Eichler, M., Adams, L., Bisognano, M., & Steudel, H.
(2003). Developing and testing a model to predict outcomes of
organizational change. Health services research, 38(2), 751-776.
Garry, J, Richard, W, Kevan, S, Duncan, A, &
Patrick, R.(2014). Exploring strategy text and case. 10th edn, Pearson
education limited, United kingdom.
Elaine.(2007). Thriving through change: A leader’s
practical guide to change mastery.ASID press, USA.
Eshleman, R. J. (2016). A Holistic Process for Leading
Organizational Change.
Espedal, B. (2016). Understanding how balancing
autonomy and power might occur in leading organizational change. European
Management Journal.
Frahm, J. (2016). Effective strategy for lean
implementation under a culturally diversified environment case: Danish
subsidiary in Indonesia. The TQM Journal, 28(3), 377-389.
Humberto, C, & Marcus, A.(2016) emerging
strategies and hypercompetitive environment to micro and small companies of
information technology.
Kotter, J.P.(1996). Leading change, Harvard business
Review press.
Kipping, M., & Kirkpatrick, I. (2013). Alternative
pathways of change in professional services firms: The case of management
consulting. Journal of Management Studies, 50(5), 777-807.
Lewis, S., Passmore, J., & Cantore, S. (2016). Appreciative
inquiry for change management: Using AI to facilitate organizational
development. 2nd edn, Kogan Page Publishers.
Lok, P., & Crawford, J. (2004). The effect of
organisational culture and leadership style on job satisfaction and
organisational commitment: A cross-national comparison. Journal of
management development, 23(4), 321-338.
Manzoor, Q. A. (2012). Impact of employees motivation
on organizational effectiveness. Business management and strategy, 3(1), 1.
Meredith, G.(2013). Building and sustaining a culture
of assessment: best practice for change leadership. Emerald Group Publishing
Limited, 40(1), 13-31.
Nova, S. Change Management Models: A Look at
McKinsey’s 7-S Model, Lewin’s Change Management Model and Kotter’s Eight Step
Change Model. http://sumonova.com/change-management-models-a-look-at-mckinseys-7-s-model-lewins-change-management-model-and-kotters-eight-step-change-model/.
Naipinit, T., Kojchavivong, S., Kowittayakorn, V.,
& Sakolnakorn, T. P. N. (2014). McKinsey 7S model for supply chain
management of local SMEs construction business in upper northeast region of
Thailand. Asian Social Science, 10(8), 35.
Pollack, J., & Pollack, R. (2015). Using Kotter’s
eight stage process to manage an organisational change program: Presentation
and practice. Systemic Practice and Action Research, 28(1), 51-66.
Robert. (2007). Management fundamental, concepts,
application, skills development. 7th edn, sage publication, UK.
Richard, L (2015) strategic management. 7th
edn. Pearson, United Kingdom.
Singh, A. (2013). A study of role of McKinsey's 7S
framework in achieving organizational excellence. Organization Development
Journal, 31(3), 39-50.
Schein, E. H. (2010). Organizational culture and
leadership (Vol. 2). John Wiley & Sons.
Thomson, N. B., Rawson, J. V., Slade, C. P., &
Bledsoe, M. (2016). Transformation and Transformational Leadership:: A Review
of the Current and Relevant Literature for Academic Radiologists. Academic
radiology, 23(5), 592-599.
Wambugu, L(2014) effect of organisational culture on
employee performance. European journal of business and management, vol.
6, 32.
William, M.(2016). Predictor of change management: A
literature review. Africa journal of management, 10(13), 585-593.
Ward, D. (2005). An overview of strategy development
models and the ward-rivani model. Economics Working Papers, June, 1-24.
Xumin, L, Salman, A, & Athman, B(2011). Change
management for semantic web service. 1st edn, Springer science &
business media, UK.
Zouaoui, F., Triki, A., & Ferchichi, A. (2016).
CRM Implementation Process: Application of the Strategic Alignment Model. International
Journal of Application or Innovation in Engineering & Management, 5(3),
142-152.
Comments