EXTENDED DIPLOMA IN STRATEGIC MANAGEMENT AND LEADERSHIP

Title Page
BIRMINGHAM INTERNATIONAL COLLEGE

Module Assignment

Strategic Change Management

Prepared for: Dr. Steve Hill .

Prepared By: Asad Ali

Total Words (3,770)

Strategic Change Management 1 Asad Ali

Table of Contents
Title Page.................................................................................................................................................1
Table of Contents....................................................................................................................................2
Model of Change.....................................................................................................................................2
Kurt Lewin’s Change Model.................................................................................................................2
Kubler Ross Five Stage Transition Cycle...............................................................................................2
ADKAR Change Model.........................................................................................................................2
Examples of Change Models....................................................................................................................2
Strategic Interventions (Value)................................................................................................................2
Need of Strategic Change........................................................................................................................2
Factors Deriving Change..........................................................................................................................2
Economic Factors.................................................................................................................................2
Technological Factors..........................................................................................................................2
Globalization........................................................................................................................................2
Quality & Innovation............................................................................................................................2
9/11 Attacks.........................................................................................................................................2
Investors Trust.....................................................................................................................................2
Resource Implication (If not responding to change)................................................................................2
System Development and Evaluation for Involvement of Stakeholder...................................................2
Stakeholder Analysis............................................................................................................................2
Evaluation............................................................................................................................................2
Stakeholder Circle................................................................................................................................2
Evaluation............................................................................................................................................2
Strategy for Change Involving Stakeholders............................................................................................2
Strategy for Managing Resistance...........................................................................................................2
Ongoing Change Models..........................................................................................................................2
Kotter’s Eight Step Model....................................................................................................................2
Action Research Model of Change.......................................................................................................2
Steps For Implementing Change..............................................................................................................2
Measures to Monitoring..........................................................................................................................2
References and Readings.........................................................................................................................2

Strategic Change Management Asad Ali

Model of Change

Kurt Lewin’s Change Model

Kurt Lewin presents his three phase model for managing change. Three stages are unfreezing,
change and refreeze or freeze. This model seems to be very simple but it is possible to take is to
different level of complexity too. It depends on the organization and its structure.

In first stage the need of change is realized. This stage focused that we lived in a dynamic
environment which is constantly changing. It is emphasized that change is necessary for progress
and a sense of urgency is created among the team members. It states that as early as we adopt the
change it will beneficial at organizational level and as well as at individual level.

The stage emphasis that changes is not an event rather it is a process. It is also called stage of
transition. This is hardest stage as a lot of resistant may came from members. It is very difficult
to leave the existing methods of doing things and adopt the new methods. It is actually the
implementation stage.

In third stage the change is stabilized. The new ways of doing things are made the part of
routines of the organization. The individuals, departments and organization accept the change
and it becomes the part of the norms. People become comfortable with the change and new
relations are developed.

Kubler Ross Five Stage Transition Cycle

In contrast to Kurt Lewin’s model it is a five stage model. The five stages are Denial, Anger,
Bargaining, Depression and acceptance.

Denial is actually first stage of cycle and it is used by the people as initial defense for neglecting
the change. In this stage usually it happened that employee do not want to believe that change is
going to happen. In second stage the individuals realized that they cannot continue the denial.
People shows anger and blame one and other for occurrence of the change. In third stage the
people accept the change but want to postpone it and it is a natural fact. The individual starts
bargaining in order to postpone the change. In fourth stage the individual understands that the
bargain is not going to work anymore and he has to loss the current practices. The level of
motivation may drop for employees and they might feel some sort of depression. Sick leaves and
annual leaves are taken by the employees normally during this period. In last stage the people
accept the change after knowing that the fight is not going to work. They understand the benefit
of change and started to consider it as a new daily norm of work.

ADKAR Change Model

This is five phase model. The stages are Awareness, Desire, Knowledge, Ability and
Reinforcement. In first step awareness for need of change is provided to members. In next step a

Strategic Change Management Asad Ali

desire is ignited in member for change. The individual in this stage is able to reach at the stage
where he found that there is a desire for change inside him. In third stage knowledge regarding
implementation of change is provided – how to change? After providing/ getting knowledge the
skills required for change are build and this is the main difference between theory and its
implementation. In last step main emphasis is put on the incorporation of change in daily routine
and change become the norm of day to day life.

Examples of Change Models

We can see that for gaining more control on several businesses under GE, Cordiner bring
bureaucracy to organization. Kurt Lewin’s three step change model is relevant to this change. It
realized first that a change in structure of organization is required to gain more control over
many businesses – it means the need for change is realized. For streamlining the company
practices a team of consultants was developed for devising strategies and these strategies are
implemented in organization – this relates to second step which represents that change is a
process not an event. The change is than implemented permanently and this relates to third step.

We can see the implementation of ADKAR model in GE under Welch era. He has an idea that
employee must be involved in company’s quality process and for this organization is required
change. In order to involve employees in quality process he chooses Six Sigma. He spread
awareness in GE by inviting Bossidy to present this idea in front of GE management. The
management shows its willingness to this idea and a desire for change is rise in organization.
Than the necessary training (Green Belt, Black Belt and Master Black Belt) was provided to
employees and it is make sure that they are skilled enough to bring this change to organization.
In last step the change was made the part of daily life.

Welch brings a change in organization that the bottom 10% performers need to leave the
organizations. After implementation this change the employees tried to neglect this change. But
due the firm attitude of Welch and removal of 10% employees, the staff realized that they cannot
continue denial. They tried to bargain but at last they adjusted with this change and try hard not
to be in the bottom 10%.

One more example can be drawn from the era of Borch. Kurt Lewin’s three stage model is stands
good for this change as he introduced Strategic Business Units (SBUs) in GE. He realized the
requirement for change. He devised and implemented strategies. Finally, he made the change
permanent.

Strategic Interventions (Value)

General Electric is a large company and working on more than 7000 project at a time. The
strategic intervention plays a vital role in performance of company. The company uses several
interventions to gain many advantages. Following is a brief summary how strategic interventions
are valuable for GE.

Strategic Change Management Asad Ali

Team building intervention can play role to gain high productivity. The individuals and groups
which are not performing well can be well trained and become more productive. The conflict
among the team members can be resolved. The team can find barrier that thwart creativity.
Human interventions stabilize the relationships among the members and enhance the
communication level of individuals. It enables members to find their own strengths and
weaknesses. It enables members to understand behavior of each other and avoid conflicts.
Individual can take decision according to the situation faced by him. The decision making power
of individuals can be increased.

Need of Strategic Change

GE is operating in a dynamic environment where change is taking place at a high rate. At
different time’s need of change is different for GE. At initial times GE was not such a big
company. At that time the need of change was the expansion. Two companies were merged to
form GE and in result of merger the organization required certain changes.

The psychology, leadership style and management philosophy of leaders was another factor that
guide the change in organization. Expansion in diverse genre of business guides company to take
further changes.

As we have seen coriander changes the structure to control several businesses because GE was
organized as holding from its initial times. In 1950s the businesses heads were operating the
business as their independent businesses.

Need for involvement of employees in Quality process is recognized by the Welch and change in
shape of Six Sigma was brought. Another need for change is derived by communication gap
between CEO and several business units.

For motivating the employees GE introduced several benefits for staff. Staff was entitled for
bonuses, pension, GP Fund, stock options, and insurance. GE brings change to their
compensation and appraisal system for motivating its employees.

Factors Deriving Change

Economic Factors
One big factor that brings change to organization is economic conditions of operating market.
GE faces the same problem in 1970s recession. GE diversified its business during the recession
in order to spread the risks. Welch introduced strategy “Fix it, sell it or close it” due to some non
performing units. He closed several units during his era.

Technological Factors
Technology has brought brisk changes in almost every industry. The fate of industries changed
drastically by the use of technology. The same case was happened with GE. In 1972 Jones

Strategic Change Management Asad Ali

shifted the company from electromechanical to electronic technology. Heavy investments were
made in office automation to increase the productivity of GE.

Globalization
Globalization was another factor which forced Jones to brought changes to GE during the decade
of 1980s. GE was facing tough competition from European and Japanese markets. Several
changes took placed due to overseas competition.

Quality & Innovation

Six sigma was introduced by Jack Welch. The requirement of Six Sigma was highlighted for
involvement of employees in innovation and quality system. The basic factor behind introducing
programme was the good quality products introduced by the Japanese and European companies.

9/11 Attacks
Some drastic changes to GE was made due to 9/11 attacks on twin towers. GE business faced a
decline. Immelt enforced several changes to cop up the effect of the incident e.g. restricting of
business, reorganization of business lines.

Investors Trust
After the incident of Enron and WorldCom the trust of investors were dwindled on large
conglomerates. The Immelt made several changes for gaining back the trust of investors.

Resource Implication (If not responding to change)

Several resource implications could harm GE if GE was not responded to change.

If GE was not responded to change they may save some funds but it was very difficult for them
afterwards to maintain the level of funds. GE was facing competition from Europe and Japan. If
the company did not make the changes the competition may eat up the GE and it may difficult
for company to survive and maintain their funds.

The human resources were trained in order to bring the change. They performed more productive
after training and involved in the process of quality and innovation. If the change in company
was not made the employees may not able to participate in the process of innovation which
might result in the company failure.

In 1970s the company shifted from Electromechanical to Electronic technology and office
automation was made during the tenure of Jones. It increased the company’s productivity and
gave company a competitive advantage. If the GE was not responded at that time the company
may not able to acquire such a sophisticated technology which they have now. It might result in a
failure.

Knowledge is another resource for a company. By not responding to change company may suffer
lack of knowledge.

Strategic Change Management Asad Ali

Infrastructure of company may not be such sophisticated which they have now if GE was not
responded to change. 0044 77 806 806 00

System Development and Evaluation for Involvement of Stakeholder

There several systems of involving stakeholders in the process of change because they are
affected by the change made to organization.

Stakeholder Analysis
Stakeholder analyses provide a detailed look at several groups of stakeholders and help the
organization to understand the needs of those groups. It helps the organization to took a decision
which incorporate the thoughts of all groups.

Investors

Investors are affected by every business decision. It is necessary to involve investors while
taking the change decision. As we can see in case study that the confidence of stakeholders was
dwindled. It is very important to incorporate the thoughts of stakeholders in change process.

Suppliers

Business change decision may affect the suppliers of business also so, it is necessary to consider
the effects that can harm the suppliers.

Employees

In change processes the employees are integral part because they have to implement and follow
the system so the consideration must be made for involvement of employees’ suggestion in
change process.

Customers

In today’s dynamic era companies are more focused towards customers and customers are
integral part while deciding the change in organization. The effects of change can made a great
impact on customers. It is necessary to involve the stakeholders in change process.

Society and Government

Society and Government both are affected by the changes made in company. It is necessary to
make consideration for both in change process.

Creditors

Last but not least creditors has interest in company’s performance as the losses to company have
direct impact on them. The need for involvement of creditors in change process is mandatory.

Strategic Change Management Asad Ali

Evaluation
GE is a huge company with lots of projects. The above mentioned system might work well for
the organization because company has lots of stakeholders and each stakeholder have its own
requirements and needs from the companies. The analyzing of stakeholders will provide
company a good opportunity to meet with the demands of the stakeholders.

Stakeholder Circle

Develop
Map Optimise Monitor
Identify Priotise Chnage
Profiles Support Changes
Strategy

In this methodology the data regarding all stakeholders is gathers. The need and interest of each
stakeholder in organization is assessed. After gathering the data all stakeholders are prioritize
according to need of organization and the effect of change on each group of stakeholders. There
profiles are mapped by the organization. A categorized list is developed in order to find the
requirement of the stakeholders and impact of change on them. The extent of support which can
be received during change process is assessed. In consideration of above mentioned facts a
change strategy is devised. Targeted communication plans are developed. In last the monitoring
of changes has been done by the organization.

Evaluation
Above system holds goods for big companies like GE. It is a systematic process which involves
the stakeholders in making decision for change. It will provide GE a solid method for prioritizing
their stakeholders. It helps company to develop a strategy which will engage stakeholders in
decision making regarding change in organization. Mapping of stakeholders allows company to
target the right stakeholder at right time and decide about how much involvement is required
from a specific stakeholder.

Strategy for Change Involving Stakeholders

Following step may be followed in order to making change in organization involving
stakeholders.

1. First of All GE must understand the vision and change initiatives.

2. Leaders must engage the stakeholders in change process by using above mentioned
models.
3. Assessing the requirements and interest of stakeholders.
4. Selection of change model.
5. Expected reaction of stakeholders in response to change is analyzed.
6. A dynamic and system communication track is developed in order to make stakeholders
well informed regarding change.
7. Tasks in regard of change are prioritized.

Strategic Change Management Asad Ali

 8. Suitable time table is developed.
9. Finally the change is implemented.
10. The effect of change on stakeholder is monitored.
11. Problem areas are highlighted by making discussions and holding meeting with
stakeholders.
12. Highlighted problems are removed and change is made permanent.

Strategy for Managing Resistance

There are several strategies which can be used for managing resistance in organization.

1. Open communication may be promoted in GE in order to stop resistance against the

change. The employees may have full right to explain their problems which they facing
due to change. The problems then must be removed in order to make the employees
comfortable with change.
2. Necessary training (related to change) may be provided to employees so they may feel
comfortable while handling the new methods which change bring to organization.
3. The employees must involve in the process of change in initial stages because it is a fact
that the processes are better understand by the people which are close to process. They
might highlight some point which will help management to reduce resistance in future.
4. Different forums may be developed to discuss the impact of change and problems faced
by employees.
5. All stakeholders must listen in order to deal with the problems faced by them after
implementation of change.
6. A 360 degree feedback culture may be developed in order to reduce the resistance.
7. The needs of stakeholders must be addressed so they find it easy to adjust with change.
8. The employees involved in change may be rewarded and recognized so that other
employees may take some inspiration from them.

Ongoing Change Models

The two models mentioned below can be used for managing ongoing change in GE.

Kotter’s Eight Step Model

Step 1 A sense of urgency can be created around the GE. The discussion on positive aspects of
change can be made at management level to realize that it is better to change quickly. Sincere
group discussion can be made to explore opportunities and avoidance of threats.

Step 2 After creating sense of urgency the staff is convinced to participate in making the change
a success. The true leaders are highlighted in the organization. The working in team building can
be encouraged in order to control the member professionally and emotionally. Weak areas at
individual level and team level are highlighted and removed.

Strategic Change Management Asad Ali

Step 3 The values relating to change are determined and matched with the organizational values
and vision. The key points for future of organization are highlighted. The strategy for
management of change is devised.

Step 4 Vision of change is conveyed to staff members. The teams are made clear what they have
to achieve in future. Regular team discussions are made to talk about the change vision. The
leaders must lead by example so that the employees followed their paths.

Step 5 A detailed reviews of organizational structure, job description, performance and

compensation systems can be made to check whether they are inline with the change vision or
not. The recognition and rewards are offered for the people making change happen. Reduced the
obstacles made by the people resisting change and help them to understand the change.

Step 6 Implement short/ easy projects initially which can be implemented without heavily help.
The expensive/ resource intensive projects may not be adopted early. The short term will boost
the morale of persons involved in change process.

Step 7 After completion of each short term project evaluate the results. Find the ways to improve
the performance. Continue to improve the momentum you have achieved. Try to make
continuous improvements to processes involved in change.

Step 8 Finally made the change permanent and part of daily routine. Discuss the success stories
relate with the change. Recognize and reward the change agents publically so the others can also
took inspiration and perform well for next change.

Action Research Model of Change

Reflect Plan

Act & Act &

observ observ
e e

Revise
Reflect
Plan

Strategic Change Management Asad Ali

For implementing Action Research model first of all GE must plan the required change. The aim
of change is defined. It is check that the change is aligning with the vision of company or not.
The leaders are identified and resources are allocated. Actions are prioritized and leaders guide
their teams regarding change. Leaders provide the teams members with necessary guidance and
motivate them. Leaders make them realized that change is beneficial for organization and
individuals. The new pattern of performing tasks and new things came in result of change are
good at every level.

Once the teams are ready, the change is implemented. Leaders watch closely whether the new
things are working good or not? The obstacles in implementing the change are removed by the
leaders. Leaders observe the performance of the team. The problems while performing tasks on
new things are highlighted by the leaders. The plan is revised after removing the obstacles and
problems encountered by the processes. The revised plan is implemented and leaders observe the
performance of the plan again if the plan is satisfactory the plan is implemented on permanent
basis else it is again revised for removal of obstacles. After successful completion of first plan
the next plan can be implemented in the same way. As GE is a large company and having ample
resources GE can implement several plans at a time for different areas of business.

Steps For Implementing Change

Step 1: Analyze the need of change First of all GE must analyze the need of change. As GE is a
large conglomerate, so the identification of areas is also necessary where the change is required.

Step 2: Selection of Model The model of change can be selected according to the requirements
of the organization. The above two model can be selected as those are suitable for large number
of situations.

Step 3: Analyzing probable reactions The expected reaction – whether internal or external - are
analyzed. The reaction of employees, stakeholders and other parties are analyzed in response to
change.

Step 4: Final Decision After analyzing the reactions, the suitable actions are performed to make
the stakeholders understand that the change is beneficial. After gaining the confidence of all
parties the decision of change is finalized.

Step 5: Establishing Timetable Actions in regard of change are prioritized. As change is not an
event time table is constructed for implementation of change. The tasks which are less resource
consuming performed first as they help the participants to gain confidence.

Step 6: Implementation & Monitoring Finally the change is implemented and the results of
change are gathered. These results are compared with the expectations and room for
improvement is highlighted.

Strategic Change Management Asad Ali

Step 7: Making the Change Permanent If required the plan is revised and implemented with
improvements. The change is made permanent and part of daily routine life.

Measures to Monitoring
Following steps may be followed in order to monitor the progress of change.

Step 1: Define Change Policies The rules and circumstance in which the change is going to be
implemented. The Policies are devised for managing the change. Different set of procedures can
be drawn for handling the change.

Step 2: Roles and Responsibilities Roles and responsibilities of involved individual are defined.
These responsibilities must be understandable to individuals.

Step 3: Target Setting: Targets are set for individual and teams. These targets must be
SMARTER (Specific, Measurable, Achievable, Realistic, Time Bound, Extended and
Rewarding) so that individuals can understand and perform accordingly.

Step 4: Monitoring Actions and Events The results of relevant events and actions taken during
the change process are monitored. If the results are inline with the set time table and Targets than
the change process is doing well. Otherwise the problems are highlighted.

Step 5: Conduct Meetings For understanding the problems faced by the teams and individuals
meetings can be arranged where members can openly share their views and thoughts. If the
meetings involved closed ended questions it will difficult for management of GE to find out the
progress of the change model. The solutions for highlighted problems should arrange.

Step 6: Review Performance It is made sure that the performance of change agents is measured
at regular intervals and assessment of achieved should be performed. The best performing
employees may be recognized. The targets for next period may be assigned during the meeting.

The above process may be followed after specific intervals of time, so that the progress of
change can be measured continuously.

Task 6.1 Schedule for Implementing Strategic Plan

 All initiatives included in plan must be cleared by answering the five important points
mentioned below;
o Who?
o What?
o Why?
o When?
o How?
 After knowing the answer of above questions objectives of strategic plan will prioritized
 A realistic time table will be developed for execution of plan.

Strategic Change Management Asad Ali

  After than the plan will be communicated to relevant persons.
 Staff must be motivated and plan must be kept dynamic and ongoing.
 Milestones will set for staff in order to evaluate and monitor the progress.
 Quarterly meetings will be held to share the progress with key personnel.
 Problem areas will be highlighted and remedies for betterment will be suggested.

The above mentioned schedule may be followed in order to implement the strategic plan.

Note: I have not mentioned the time duration required for each step because the time depends on
the current situation and circumstances.

Strategic Change Management Asad Ali

References and Readings

KOTTER, J. AND SCHLESINGER, L. (1979), Choosing Strategies for Change. Harvard

Business Review. Vol. 57, pp. 106 – 114.

Mind Tools (2010), Implementing Change Powerfully And Successfully [Online] Available at:

http://www.mindtools.com/pages/article/newPPM_82.htm [Last accessed 21-11-2010]

MORGAN, N. (1996), 9 Tips for Change Agents [online]

Available at: http://www.fastcompany.com/magazine/05/changetips.html [Last accessed 21-11-
2010]

SENIOR, B. (1997), Organisational Change London: Pitman Publishing

SOLID CORE (2006), Change Management + Control - Higher Availability [online] Available
at: http://www.solidcore.com/assets/change-management-change-control.pdf [Last accessed 21-
11-2010]

TICHY, N. (1997), Bob Knowling’s Change Manual [online]. 

Available at: http://www.fastcompany.com/magazine/08/change2.html [Last accessed 21-11-
2010]

Strategic Change Management Asad Ali