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IJLM
21,2 Changing chains
Three case studies of the
change management needed to reconfigure
230 European supply chains
Remko van Hoek, Mark Johnson and Janet Godsell
Cranfield School of Management, Cranfield, UK, and
Andy Birtwistle
British American Tobacco, London, UK

Abstract
Purpose – Many supply chain reconfiguration programs are launched each year. Despite a wealth of
knowledge existing in the general management domain, there has been little work within the supply
chain management domain on change. That which does exist deals with change to a technical – as
opposed to non-technical – system. This leaves out many of the social and behavioral aspects of
change. This paper aims to address this gap.
Design/methodology/approach – The paper synthesized the general management and supply
chain literature on change to create a framework to explore change within three supply chains.
A multiple case study approach was adopted for the research. Longitudinal and quasi-longitudinal
data were gathered and template analysis utilized to explore the cases contexts and the design choices
they made in each of the change programmes.
Findings – In all three cases, the change is non-linear and required re-planning and learning
throughout the change effort to build the capacity and capability for change. In all three cases, the
success of the change is facilitated through the use of cross-functional teams.
Originality/value – Change leaders were involved in the research through co-authorship and
a unique set of cross-case lessons learned were generated. The framework used in the analysis
incorporates considerations previously ignored in the supply chain literature, including the non-linear,
non-processual nature of change.
Keywords Change management, Supply chain management, Europe
Paper type Research paper

1. Introduction
It has been estimated that approximately 75 percent of the content of products are
sourced from outside the original equipment manufacturer (Trent, 2004). It is therefore
no surprise that supply chain is viewed as the dominant function of the modern
organization (Miles and Snow, 2007). It has also been suggested that competition is no
longer between companies but supply chains (Christopher, 2005) which is being driven
by cost pressures; increased consumer choice; and shortening product lifecycles.
Thus, the need to change processes within the supply chain function, change the way
in which the supply chain function interacts with other functions internally and change
The International Journal of Logistics the way in which the function interacts with other actors externally is paramount for
Management the modern organization to survive in today’s environment.
Vol. 21 No. 2, 2010
pp. 230-250
q Emerald Group Publishing Limited
0957-4093
The authors wish to thank the Editor and the two anonymous reviewers in their constructive
DOI 10.1108/09574091011071933 critique which allowed them to strengthen much of the paper.
 Despite the requirement for change, there is little academic research that examines Changing chains
the change in processes in the supply chain function and relationships between the
function, its peers and its customers and suppliers. Examples of prior work include
O’Laughlin et al.’s (1993) work on reconfiguring European supply chains, Ross et al.’s
(1998) research on developing a methodology for supply chain reconfiguration and Greer
and Ford’s (2009) work on the differences in change processes within supply chain and
non-supply chain programmes. 231
The extant work on change in supply chain management (SCM) has tended to take a
processual view of change. This is in contradiction with the premise that change happens
to people as well as processes (Balogun and Jenkins, 2003). Moreover, it has been observed
that minimal consideration has been paid within the supply chain domain to social and
behavioral aspects (Frankel et al., 2008). In this research, we seek to contribute to this
literature by presenting the results from three case studies on change within a supply
chain context. An extant framework from the general management literature is used to
allow framing of the results in a way that indicates where the research gaps from the
supply chain research are. In that way, the existing functional knowledge on change in
SCM is extended.
The remainder of the paper is structured as follows. In Section 2, the extant
literature on change from the supply chain domain and relevant literature from general
management is reviewed. From the literature, a framework for the current research is
developed. In Section 3, the methodology is presented. After the methodology, the
individual cases are presented, followed by Section 4 the cross-case analysis. The final
Section 5 the paper concludes the research.

2. Literature review and case study framework development

2.1 Change literature from the SCM domain
There has been a limited amount of research performed on change within a logistics and
supply chain context. O’Laughlin et al. (1993) developed a multiple-stage framework for
reconfiguring European logistics systems in which the stages are: visioning, strategic
analysis and planning and management of the actual change process. The visioning
stage is argued to be most crucial to the reconfiguration process and they point at three
key enablers: top management support, the use of a total supply chain perspective and
the use of a structured planning process for making the case and preparing for the
change. The call for senior management support is common (Bowersox et al., 1992;
Bagchi and Skjoett-Larsen, 1995; Berry et al., 1995; Drew and Smith, 1998).
Berry et al. (1995) presented a case on business process re-engineering of an
electronic products supply chain. They present a nine-stage model for re-engineering a
supply chain. Ross et al. (1998) offer a six-step reconfiguration framework that adds
several items to the O’Laughlin et al. (1993) considerations. They point at the
importance of assembling a decision-making team; the development of performance
measures and identification of best practices; and the development of a reconfigured
model incorporating best practices. The items that Ross et al. (1998) add to
O’Laughlin et al. (1993) are tied to behavioral aspects. This is in line with Frankel et al.
(2008), who point at the need to look at specific behavioral aspects and the need to look
at what makes supply chain visions practical.
There are a number of other suggestions from the extant literature that reinforce
and supplement the work of O’Laughlin et al. (1993). Ross et al. (1998) suggest that
IJLM benchmarks and best practices should be used. Consultants such as McKinsey and
21,2 Accenture and research organizations such as Americas region and the Aberdeen
Group suggest there are clear benchmarks that can be used to identify improvement
opportunities in making the case for change. Moreover, they should assist in
determining what specific steps to take in order to improve. Whilst O’Laughlin et al.
(1993) suggest gaining top management support is key, there is a need to consider how
232 this support was gained initially, and after that, how it was then sustained. This
requires not only an attitudinal adjustment upfront but also in the implementation and
subsequent operation so as to ensure that the change sticks (Berry et al., 1995; Drew
and Smith, 1998). We suggest that the same goes for middle management and
work/shopfloor support and involvement as these are key to the change process
(Balogun et al., 2005). Ross et al. (1998) suggest that the first step in a change process is
to look at the constitution of the project/work teams that are tasked with making the
change happen. Additionally, how is governance of the ongoing
change/reconfiguration effort structured? These considerations address the fact that
making a plan and selling it to top management are key but likely not sufficient to
actually accomplish change throughout the supply chain. Finally, the limited literature
on reconfiguring supply chains seems to suggest that change can be planned and
executed in a pre-planned and directed manner (O’Laughlin et al., 1993; Berry et al.,
1995; Ross et al., 1998; Greer and Ford, 2009). The majority of these prior works place a
rational, processual view on the change. It is only Drew and Smith (1998) in their
conceptual work who suggest that the path of change may not be straight. Relevant
literature on change from the general management is now reviewed to indicate where
there are – and are not – areas of consensus between the works in the SCM field and
those in the broader management field.

2.2 Change literature from the general management field

The study of change is one of the largest areas within the fields of management and the
social sciences (Pettigrew et al., 2001). Despite the mass of research into this area, there
is little consensus to some of the key themes within the field such as the pace, sequence
and linearity of change (Amis et al., 2005).
A number of authors argue that change needs to occur quickly as this creates inertia,
inter-departmental synergies and overcomes any internal resistance to the change efforts
(Greenwood and Hinings, 1988; Romanelli and Tushman, 1994). Other authors argue that
change needs to take place over an extended period of time as it involves numerous actors
and changes to their values, ideologies and technologies (Pettigrew et al., 1992) and those
involved need to “make sense” of the change (Weick, 1995; Balogun, 2006).
The sequence of change refers to which parts of the organization are changed and in
which order (Van de Ven, 1992). For example, does the change occur to peripheral
activities and functions first? Or do the high impact, core functions and activities get
changed first? Most of the research suggests that change needs to occur to the
high-impact areas first as this conveys the importance of the change initiative (Hinings
and Greenwood, 1988; Kikulis et al., 1995). Others argue that change needs to begin on
the periphery in order to create momentum (Beer et al., 1990).
Linearity of change refers to the stages through which a change initiative. Much of
the popular management literature is filled with “n-stage” change models (Tichy, 1983;
Kotter, 1996; Buchanan and Huczynski, 2009), implying that change follows a neat,
sequential process. Amis et al. (2005), suggest that there is anecdotal evidence that this Changing chains
is not the case. There are numerous examples where the process of change is
characterised by high levels of uncertainty, trial and error, modification to the initial
processes, delays and changes in pace (Kanter, 1984; Greenwood and Hinings, 1988;
Denis et al., 2001; Heracleous and Barrett, 2001). These prior works in the general
management field contravene a number of pieces of research from supply chain
academics (Berry et al., 1995; Ross et al., 1998; Greer and Ford, 2009) who suggest that 233
change in a supply chain context can be packaged into a neat, linear process. They
instead imply that change is a messy affair.
The prior literature on change within the logistics and supply chain domain has also
tended to suggest that the linear process of change acts on a technical system with people
playing a supporting role (O’Laughlin, 1993; Ross et al., 1998; Greer and Ford, 2009). This
is despite there being a wealth of evidence that implies that change solely to a technical
system – without taking into account the intrinsically linked social system – can result
in adverse consequences (Trist and Bamforth, 1951; Cherns, 1976; Davis, 1977). This is
due to people struggling with the social upheaval that results from the technical change.
Further research from SCM has suggested that benchmarks should be used to highlight
opportunities for improvement (Ross et al., 1998). Greenwood and Hinings (1993)
suggest that these points of reference (or “archetypes” in their language) have high levels
of institutional specificity and contain not only performance information but also
the cultures and routines needed to attain them. Or, in other words, whilst it is ok to want
to look like Toyota but does your culture and routines enable that to happen?
There are clear differences between the literature from the SCM and general
management domains. In order to reconcile them, we adapt an extant framework
(Hailey and Balogun, 2002; Balogun and Hailey, 2009) and synthesise three of the
extant SCM works into it (O’Laughlin et al., 1993; Drew and Smith, 1998; Ross et al.,
1998). The use of an existing framework is advantageous as it has already been used in
the research of a large-scale change programme. Moreover, by synthesising the extant
literature from the SCM domain into the framework, we can begin to examine the state
of the art in SCM change research for strengths and weaknesses in comparison to the
general management literature. Table I shows the adapted framework.
Table I shows that the change items and frameworks from the supply chain literature
have partial coverage of the items discussed in the selected framework. This includes
little discussion of the time to conduct the change, preservation – or destruction of
resources and competences – and power within the organization. Moreover, there is no
consideration of diversity in cultures at a national, organizational or business unit level.
This suggests that the prior supply chain research may have had gaps in their findings
due to a lack of consideration of other items. Moreover, what has been considered by the
researchers in the supply chain domain is akin to the content (or “what?”) of change
rather than the process of changing.

3. Methodology
3.1 Research design
The study of change management in a supply chain context is an emergent field of
study. Therefore, the most appropriate methodology for such a nascent area is a
qualitative method (Edmondson and McManus, 2007). A case study approach was
used for this research as this allows the exploration of complex, messy phenomena
 21,2

234
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Table I.
Case study framework
Change management perspective
Strategic change Supply chain
Hope-Hailey and Balogun (1999) O’Laughlin et al. (1993) Ross et al. (1998) Drew and Smith (1998)

Case context
Scope – breadth and depth of the change Total SC perspective
Customer service first
Internal integration addressed
External integration addressed
Cross-border integration addressed
Information technology integration
internally, with suppliers and with
customers addressed
From country to pan-European focus
Balanced focus on cost and service
Time required to conduct change
Preservation or destruction of assets and
competences
Diversity of cultures and business units
Capability of the organization to manage Capability to change
change
Capacity of the organization – both cash Will to change
and staff – to conduct the change
Readiness – awareness of and Will to change
commitment towards the change
Power – stakeholders and sources of
power?
(continued)
 Change management perspective
Strategic change Supply chain
Hope-Hailey and Balogun (1999) O’Laughlin et al. (1993) Ross et al. (1998) Drew and Smith (1998)

Design choices
Change path Top management support and Were there changes to the
involvement reconfiguration efforts along the way?
Change start point Were benchmarks and best practices
used in designing and evaluating the
change and progress of change?
How was top management support
gained?
How was middle management support
gained?
How was worker-level support gained?
How was worker-level support gained
and sustained?
Change style Structured planning process How was the governance of the change Focus of the change
organized?
Change target Results so far? Focus of the change
Change roles How was top management support
gained and sustained?
How was middle management support
gained and sustained?
How was worker-level support gained
and sustained?
Working team composition?
Change levers
Changing chains

235

Table I.
IJLM (Eisenhardt, 1989; Yin, 2008). The process of change is undoubtedly messy and
21,2 complex, and Ellram (1996) recommends the use of case studies for the study of
implementation and change issues. Moreover, case study research allows the collection
of rich, explanatory information (Mentzer and Flint, 1997) and allows researchers to
build theory and connect with practice (McCutcheon and Meredith, 1993).
As change occurs over time, a process orientation to the study was adopted
236 (Mohr, 1982; Langley, 1999). This is as opposed to the more traditional “variance” type of
research where constructs and causal impacts are the focus of the study, rather than
change(s) over time. Langley (2007) suggests that a process approach to the examination
of the transition process rather than transition outcomes only is more appropriate. This
is because traditional cross-sectional models provide a partial picture of the world that
evacuates the role of time and assumes an equilibrium state.

3.2 Sample frame

Within the bounds of case study research, there are several different types of case study
design. This ranges from interpretivistic single cases that seek to explore (Dyer and
Wilkins, 1991) and multiple cases that aim to generalize (Eisenhardt, 1989). In this work
three case studies were conducted. The key advantage of a multiple case study approach
is that the evidence from multiple case studies is often considered more compelling, and
the overall study is therefore regarded as robust (Herriott and Firestone, 1983;
Eisenhardt, 1989). However, the use of multiple cases has drawbacks in terms of the
selection of appropriate cases. They must predict similar results – the logic of literal
replication – or produce differing results for explainable reasons – the logic of
theoretical replication (Yin, 2008). Given the context-specific nature of SCM and change
(Balogun and Jenkins, 2003; Burgess et al., 2006), it is difficult to predict whether
contextual factors will lead to theoretical or literal replication. In this case, it is assumed
that we will have literal replication due to the use of a unifying framework to analyze the
results. Three case studies with European headquarters were selected to represent a
range of both change and supply chain contexts. Conducting the cases in Europe allow
us to consider the diversity of cultures that exist. The cases comprised a utility company
(Nuon), a defense company (Smiths Aerospace) and a tobacco company (British
American Tobacco (BAT)). Table II shows high-level details of the case companies.
Table III shows the variety of reconfiguration/change efforts that were studied.
The case companies were selected to explicitly cover reconfiguration processes over
extended periods of time. Nuon were primarily focused on developing a best in class
procurement function. Smiths were relocating manufacturing to China; hence the change
had an Anglo-Sino dimension. BAT were undergoing a major business transformation
in Europe, from a federated organization to a single-market organization. The type of
reconfiguration/change effort affected both the scope and time span of change. The Nuon
case study was focused on the sourcing process over a period of three years. The Smiths
change was focused on moving parts of the supply base from Europe to China. BAT’s
change covered all forward-facing processes (plan, source, make and deliver) over seven
plus years. Table II also shows the number of informants in each of the study. These
informants were interviewed repeatedly over the course of the study. Where the change
efforts had preceded researcher access, quasi-longitudinal data were obtained
(Doz, 1996) to explore the changes that had occurred previously.
 Changing chains
Case study companies
Key descriptors Nuon Smiths Aerospace (2006) BAT

Industry Utility (energy) Aerospace Tobacco

Country of The Netherlands UK UK
origin
Revenue e6 billion £1 billion £26 billion 237
Number of 7,500 11,000 53,900
employees
Reconfiguration/ Upgrading procurement Relocating the supply Change from a federated
change effort organization and base from the UK to European organization to a
capability from purely China single-market organization
operational to mature,
strategic and best in class
capability
Time span of 3 years 2 years 7þ years
change Table II.
Number of 12 16 over four sites and 15 across Europe Summary of the three
informants China case company contexts

3.3 Data collection and analysis

In order for the data collection not to be biased through the use of extant constructs,
a semi-grounded approach was used in the collection of the data (Choi and Hong, 2002).
This was possible through the use of experienced researchers and ensured that the data
were not biased in the collection phase. In two of the three case studies, there was direct
management involvement in the data collection and analysis to enhance the richness of
the findings. These managers were involved in leading the change efforts. The potential
bias – through over-optimistic reporting of the process and its success – of this
approach was minimized through using other respondents and sources of data to
provide triangulation ( Jick, 1979). As discussed previously, the data were collected
longitudinally and this was facilitated through the use of both face-to-face and telephone
interviews. The interviews were recorded and transcribed by native speakers. English
for Smiths and BAT, Dutch for Nuon. The Dutch language transcriptions were
translated into English and then translated from English to Dutch to ensure that no
meaning had been lost in the translation.
All interviews were coded and analysed by the researchers using the template analysis
approach (King, 2005) to allow the convergence of the data with the framework. With
template analysis an initial template is constructed – in this case using the Balogun and
Hailey (2009) framework – and used in the analysis of transcriptions. After the data were
sorted and categorised, the findings of were relayed to the interviewees in a series of
workshops to ensure that their views had been interpreted correctly.

4. Case study findings

Our analysis focused primarily on supply chain change efforts from a strategic change
perspective and considered both the change context and design choices. To enable both
the richness of the individual cases and clarity in cross-case comparison, the results are
structured to reflect both within-case and cross-case analyses (Barratt and Choi, 2007).
The next section presents the individual cases from a contextual perspective. This
includes the reason for change and the process of change at a firm level.
 21,2

238
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Table III.

of case contexts
Cross-comparison
Case study
Case context dimensions Nuon Smiths aerospace BAT

Scope – breadth and depth of the change

SCOR processes
Internal integration
External integration
Cross-border integration
Time required to conduct change
Preservation or destruction of assets
Diversity of cultures and business
units
Capability of the organization to
manage change
Source
Yes
Yes, with suppliers
No, predominantly domestic market
Long-term change
and competences
Homogeneous culture within The
Netherlands
Key development factor and reason
for lengthy change process was the
requirement to build capability to
make change really happen.
Training in the benchmarking tool
and new templates and methods was
key to drive work level engagement
Source and make
Yes
Yes, partially with suppliers
Yes
Long-term change
Differences in sites; Anglo-Sino
cultural differences
Limited focus underestimated all the
requirements for successful change.
However, as new methods were
developed and experiences gained
these were shared
Plan, source, make and deliver
Yes
Vision for end-to-end SC integration
from first tier customer to first tier
supplier
Yes, within Europe
Long-term change
Cultural diversity within Europe
As a result of the transformation
project, a range of new training
programs were developed; web-
based basic supply chain education,
a three- to five-day training
programs for each of the core supply
chain processes delivered regionally
and a two week supply chain
excellence program that covered the
full span of the integrated supply
chain. This was aimed at emerging
supply chain leaders and delivered
globally. A supply chain
appreciation program was developed
for senior managers in non-supply
chain functions; education and
development was key driver of
success behind change effort
(continued)

Case context dimensions
Capacity of the organization – both More time was needed to fully
cash and staff – to conduct the
change
Readiness – awareness of and
commitment towards the change
Power – stakeholders and sources of Purchasing board and cross-
power?
Top management involvement and Yes
support
Table III.
Nuon
embed the changed way of working
into the day-to-day at the work-level
and gaining momentum beyond the
planning stage took several months
while it was anticipated directly
Beyond convincing staff, incenting
and consistent progress reviews
were needed to move beyond focus
into “hearts and minds” of staff. The
change program lasted three not two
years and is still ongoing past that
functional teams helped in making
progress
Case study
Smiths aerospace BAT
Needed an increase in local A lot of resource and support
knowledge and presence; and deployed to aid the change
resources to the effort; and the
original time-scales were too
optimistic
Owing to co-location of the transition Change started in 2002. Real traction
team, information flow was gained in 2005 and changes still
unconstrained at an operational level being embedded in 2008
but suppliers needed to be informed
better
Pilot plants; relatively limited power Project and portfolio boards
base for the change; underestimated
Yes Yes
Changing chains
239
IJLM 4.1 Case study 1: Nuon
21,2 4.1.1 Nuon: context and reason for change. Nuon is a utility from The Netherlands that
was upgrading its procurement organization over a period of three years. External
audits indicated that the company has succeeded in moving from an unsophisticated
procurement organization to one that can be compared to some of the best in the world.
4.1.2 Change process. The change journey started when the first chief procurement
240 officer (CPO) was tasked with implementing advanced procurement procedures and
reconfiguring the organization to suit. The CPO was charged with developing an
improvement plan that received board-level sign off and became part of the
annual-business planning and target-setting process. A higher score in a benchmark
model was used in the first two years of the program as an aspirational target. The
change/upgrading program was cascaded downward by offering training and
templates as well as incorporating improvement targets into personal incentive plans.
Top management was brought together in a purchasing board that supervised strategic
direction to ensure ongoing senior-level engagement in the program, as well as to ensure
the correct governance of issues in the other functional areas of the business
(i.e. procurements internal customers). Staff were asked to work in cross-functional
teams to roll out sourcing projects throughout the business, again ensuring internal
customer engagement, participation and commitment.
During the second year of the program, the change management approach was
changed and the program was expanded. It was found at that point that driving the
improvements all the way to the shop floor took more time and internal selling. It was
at this level in the organization that the new templates, tools and practices had to
become embedded for the implementation to be complete. The staff needed training in
the benchmarking tool, templates and new methods of working. Additionally, there
had not been an immediate move into action after the board signed off. Instead, it took
several months and the efforts of the purchasing board and cross-functional teams
facilitated through personal incentive plans to start the change effort.

4.2 Case study 2: Smiths aerospace

4.2.1 Smiths aerospace: context and reason for change. Smiths Aerospace is a supplier
to both military and civilian aircraft and engine manufacturers. Smiths Aerospace has
grown through various acquisitions resulting in over 30 autonomous businesses
working under one holding company and was bought by general electric by the end of
2007. The company has been reconfiguring its supply chain to move its supply base
from the UK to China. This was done in order to improve Smiths costs and focus on one
process across business units.
4.2.2 Smiths aerospace: change process. Smiths began the change across four
business units and in line with a top management focus on improving cost levels and
streamlining processes across units. It allowed a large degree of autonomy in the initial
stages of the planned change. The company found that transitioning supply took
longer and required more effort and resources than originally planned. It found that
approaches varied between plants, that there was very little sharing of experience,
there was no use of external information such as benchmarks, more cross-functional
teams were needed, that more on the ground resources in China were needed and that it
was key to inform suppliers so that they could support the process. These lessons
represent a tremendous amount of learning that took place during the change process.
As far as results are concerned, in 18-month time only 30 percent of supply for one of Changing chains
the units was relocated to China. The change process was harmonized across plants to
leverage lessons of the change effort.

4.3 Case study 3: British American Tobacco

4.3.1 BAT: reason for change. BAT is a FTSE 5 company and one of the words largest
tobacco companies. Until 2002, BAT was organized through a “federated” business 241
model in which the end market organizations were stand alone businesses. In 2002, the
central operations function undertook a review of global operations to quantify the
potential productivity benefits of leveraging their global scale. These initiatives were
reviewed by the management board and the CEO communicated to the business in June
2003 the new global vision for BAT. A step on the journey to using BAT’s global scale
was first to build on regional scale. Europe had particular opportunities as it had yet to
take advantage of the single trading block created by the expansion of the European
Union. The vision for Europe was one of the centralized regional co-ordinations. This
was achieved through the creation of regional planning hubs: Western Europe, Eastern
Europe, Central Eastern Europe and other tobacco products.
4.3.2 BAT: process of change. The first stage of the redesign process was to gain an
understanding of the current configuration and performance of the supply chains in
Europe. This was complemented with a series of benchmarking activities that
compared the costs of the key supply chain processes with other top quartile European
manufacturers and competitors. Based upon this, the factory footprint in Europe was
reviewed, leading to the conclusion that production could be consolidated and the
number of factories reduced. Two other key initiatives that took place in parallel were
the creation of a regional logistics capability and a simplified production planning
process to support the new manufacturing footprint. In 2005, a new regional operations
director for Europe was appointed. In conjunction with the regional operations
leadership team Europe (ROLTE) they created a five-year vision and strategic
framework – the “preferred future” – for European operations.
The plan was created to advance the existing strategy and integrate European
operation supported by three pillars:
(1) fewer factories, at much lower cost;
(2) managed in clusters with a strong customer focus; and
(3) enabled by organizational and cultural change.
Ownership of the “preferred future” was achieved through the creation and involvement
of an extended ROLTE team, a group of 70 key managers from across the supply chain in
Europe who were hand picked by the ROLTE. Key projects within the program included
the further rationalization of the factory footprint, product complexity reduction, and the
introduction of a common enterprise resource planning platform across the region. Each
initiative had its own project board. Above this sat a portfolio board which acted as
a gatekeeper to ensure that projects were launched only if they were appropriately
resourced and governed correctly. By 2008, the supply chain reconfiguration in Europe
had resulted in cost savings of e500 million across the region, an increase in service levels
to the end market internal customers and a significant reduction in working capital.
Table III shows the cross-case comparison of the three contexts using the
framework developed in Table II. The supply chain operating reference supply chain
IJLM operating reference (SCOR) process row indicates which of the five SCOR processes
21,2 (plan, source, make deliver and return) were changed.
The change programs in the case studies focused on different parts of the supply
chain and required integrative actions to ensure business alignment and cross
functional peer support but they did not address the whole supply chain. Hence,
integrative actions are critical to successful change management in the supply chain.
242 Nuon focused on suppliers due to procurement’s upstream position in the supply chain.
Conversely, Smiths did not inform external suppliers in their transition of supply
despite this leading to possible issues – such as withdrawal of supply – at a later date.
In all cases, the change efforts started internally to the company before going outside.
This indicates that the sequence of change needs to be inside-out and aligns with
suggestions that change needs to start in the high impact areas to begin with (Hinings
and Greenwood, 1988; Kikulis et al., 1995).
All of the change initiatives took longer than initially planned. In all cases, this was
due to the programmes running into issues which required replanning. Whilst this
finding is not unique with respect to the general management literature (Greenwood and
Hinings, 1988; Denis et al., 2001), there is little mention of it in the SCM literature. In all
cases, there was little focus on resources and competences to be preserved – a potential
oversight on the part of the managers leading the change. In Smiths case, there was
natural diversity in the process across business units, mainly due to the company
growing through acquisition over the years. This lead to the different units adopting a
number of approaches to the re-sourcing efforts. Part of the re-planning within the
Smiths programme was to homogenize the approaches to lead to a process that could be
employed company wide. Nuon required little change to the programme to deal with
cultural diversity as the change was conducted in a relatively homogenous context,
whilst BAT required change that could accommodate a range of diverse cultures.
For all case companies, the capability and capacity for change needed increasing.
This was due to the change programs evolving and progressing, this needed managers
to deal with the behavioral challenges and how to incorporate them into the change
program. Moreover, training staff and management was a key enabler of change
effectiveness and readiness across the three cases. In the case of BAT, they invested
heavily in training, education and awareness programmes to build capacity. Nuon build
capability and capacity through training in the benchmarking tool and process
templates. The need for capability and capacity indicate that a critical consideration at
the onset of a change effort is not only the will to and capability change (Drew and Smith,
1998) but the requirement to build the capacity to change.
In terms of readiness for change, communication was important to remind and
reinforce the message across the organizations (Balogun et al., 2005). All of the
companies had senior management support. In the case of BAT, they established
project and portfolio boards to provide focus for the change. In Table IV, the design
paths that each of the three cases took are presented.
The three change paths taken were different amongst the companies. Nuon and
Smiths change efforts were focused on the purchasing function while BAT adopted a
more holistic approach that sought to change the entire business. This indicates why the
change at BAT is taking longer than Smiths and Nuon at seven years and counting
(at the time of writing). In all cases, change was initiated from the top with BAT scoping
the potential for change prior to embarkation on the change journey. Placing customer
 Case study
Design choices Nuon Smiths Aerospace BAT

Change path Evolution within the procurement
function
Change start point “Top down”
Functional improvement business
case made by new head of function
Customer first Yes, but internal customer
Change style Direction/collaboration
Change target
Balanced focus on costs and Yes
services
Benchmarking Benchmarks were used to assess
base-line and improvement potential,
annual improvement targets were
set and evaluated by an external
auditor using benchmarks
Change roles
How was governance of the Purchasing board with key internal Project teams within the existing
change organized? customer to co-direct efforts and business units procurement teams
ensure business alignment
Evolution of procurement and
manufacturing
“Top down”
Need for change established through
corporate drive to reduce costs
Yes
Direction/collaboration
No, just cost
No, in the words of one informant:
“we have proceeded based on our
individual experiences without
necessarily having [information] to
guide us”
Business wide evolution
“Middle up-top-down”
Global ops team did a review to “size
of the prize” presented to the
management committee resulting in
a set of guidelines from the CEO to
all regions outlining the need to
change
Yes – but internal customers
Direction/education and delegation
Yes
Yes, consultants were used to
benchmark supply chain core
processes against top quartile
European companies and industry
peers
Each initiative had its own project
board. Above this sat a portfolio
board to ensure correct prioritization
of resources and projects
(continued)

Cross-comparison
of design choices
and outcomes
Changing chains

243

Table IV.

Table IV.
Design choices
Working team composition?
Change levers
How was top management
support sustained?
How was middle management
support gained and sustained?
How was work-level support
gained and sustained?
Outcome
21,2
244
IJLM
Case study
Nuon Smiths Aerospace BAT
Sourcing projects involve not only Cross-functional team incorporating Functional experts supported by a
procurement but also a team lead engineering design, logistics, supply chain development manager,
from the internal client organization procurement and legal finance and communication
(not procurement led intentionally managers
for line buy-in) and key internal
stakeholders
Annual target- setting and business- Ongoing communication and By creating visibility of demand and
planning process updating metrics and a constant stream of
bottom line benefits delivered
Annual benchmark improvement Regular meetings, although one Involvement driven by a small team
key performance indicators (KPIs) manager commented that there was but broad engagement through
tied to personal incentives “too much internal handshaking” workshops
needed to gain and sustain support
KPI’s and incentives, training, Staff trained, motivated, aligned and Communication and education
ongoing communication appropriately rewarded
Within three years the procurement Dependent on site. On one site, 32 Reduction in European operations
function journeyed from very basic percent of production transitioned to cost base of e500 million between
to industry leader and world class in China 2005 and 2008
selected areas according to the
benchmark model used
service first was a key focal point in all three cases, however, for more upstream Changing chains
segments of the supply chain, such as procurement at Nuon, internal customers were
used as a proxy for end customers. For Nuon and Smiths, change was initiated at the
senior levels of organizations (direction) with the process involving middle managers to
determine exactly what to change (collaboration). This indicates that the style of change
management is direction-collaboration. With BAT, there was direction from senior
management, coupled to education and delegation where the message was spread 245
through regular small group briefings to incrementally build the support for the change.
Thus, the change style was direction-education and delegation.
Benchmarks and best practices were used by BAT and Nuon to set direction, make
the case for change and audit progress on the change journey. Nuon used benchmarks to
evaluate progress and targets for middle managements to keep them incentivized.
In Smiths case, there was no external benchmarking conducted which led to some
informants commenting that this made the change process more uncertain at the outset.
There was also no internal benchmarking within Smiths in the initial stages which
meant that the autonomous business units proceeded with little sharing of learning.
In all three cases, cross-functional working teams were deemed to be critical to
the engagement of relevant stakeholders in the supply chain, although not all functions
and business needed to engage. This allowed congruence to be achieved in all cases
by the functions involved in SCM. Rather than full supply chain integration, the concept
of integration is key and specific to company and context. Together with the complexity
of the change process, it is suggested that this cross-functionality is a marker of effective
supply chain change management. As change is messy, the boardroom pitch was – in all
cases – only the start of the test. After pitching successfully to senior management and
gaining their buy-in, middle management and staff across the organizations needed to
be engaged in the effort to give the program a chance for success. Moreover, as learning
occurred continuously over an extended time period, senior management commitment
needed to be repeatedly sought to ensure that the programmes were not given an excuse
to fail through a lack of support.
The outcomes were varied in all three cases. Nuon became an industry leader in terms
of its procurement processes, Smiths transitioned 32 percent (by value) of its supply base
at one site to China and BAT reduced its cost base by e500 million in 2005-2008.

5. Conclusions and implications

We conducted three case studies over time into major change efforts in supply chains.
Comparing the three case studies it is almost surprising how a number of key features
of the change management challenges and practices were similar across these case
companies that vary in industry, markets served, size, focus area in the supply chain
(from purchasing to distribution). The cases are very different in what they are
changing and how they are changing and reconfiguring their supply chains.
We used a framework developed from the extant general management and supply
chain literature. This allowed us to analyze some of the behavioral aspects of change.
In all three cases, change was a messy, non-linear affair that to fully succeed needs to
be managed by a cross-functional team to ensure that all of the functions goals are
congruent and fulfilled. Whilst this is acknowledged widely within the general
management literature, there is little mention of the non-sequential nature of change
(Amis et al., 2005) within the supply chain literature. Moreover, in all three cases there
IJLM was a need to build the capability and capacity needed to conduct the change in order
21,2 for it to succeed. In the case of BAT, there was an intentional effort to build capacity
through the creation of training and awareness programmes.
So, why is this type of research called for yet done so rarely? This research utilized
in-depth access to executive decision makers and change program managers over an
extended period in time. It teaches things that would be hard to study with surveys.
246 Studying major supply chain reconfiguration and change management really benefits
from access to top-level owners that have oversight and extended experience with the
program. It is hard to involve executive change program managers and C-level
executives, their time is scarce and they are hard to access. Yet, the uniqueness and
richness of findings in this paper suggest that even though it may be hard to do, it is
worth the effort.

Implications for theory

The use of constructs from the general management literature allowed us to fill in the
gaps from the extant literature. These gaps tended to focus on the behavioral – as
opposed to processual – considerations of change. This research adopted a view that
change required adaptation of both social and technical systems, a theme which is
under-examined within SCM research on change to date. It also suggests that as
scholars, we need to understand the nuances of the phenomena under study in greater
detail. For example, this study took the phenomena as change in the context of a
supply chain. By greater understanding, this granularity SCM scholars can begin to
add to the more strategic debates taking place within academia.

Implications for practice

In all three cases, we observed that the companies were over-optimistic in terms of time
scale and thought that change was linear. Moreover, there were elements of the
framework that we found no evidence to support. This indicates that the framework
used may offer benefit to practicing managers in helping them in their change efforts.
Our findings reinforce many of those in the general management field that change
takes longer than expected and is non-sequential due to the need to re-plan and
increase capacity and capability through learning.

Suggestions for extending the research

This research sought to examine the process of change and not the sustainment of the
change after the event. A suggestion for further research is to revisit major change
efforts after they happened to study how to make change sustainable.

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About the authors

Remko van Hoek (PhD) is a visiting Professor of SCM at the Cranfield School of Management,
UK and CPO at Cofely, The Netherlands. He serves on the Board of Directors of the Council of
Supply Chain Management Professionals and on the editorial review boards of several journals.
Remko van Hoek is the corresponding author and can be contacted at: vanhoekr@hotmail.com
IJLM Mark Johnson (EngD) is a Senior Research Fellow within the Supply Chain Research Centre at
Cranfield School of Management. His research is focused on supply networks for integrated
21,2 solutions and he is currently involved in research contracts worth in excess of £2.5 million. His
work has appeared in International Journal of Operations & Production Management,
International Journal of Production Economics, International Journal of Physical Distribution &
Logistics Management and The International Journal of Logistics Management among other. He
was selected as one of the Production and Operations Management Society’s Emerging Scholars
250 in 2009.
Janet Godsell (PhD) is a Senior Lecturer at Cranfield School of Management which she joined
in 2001, having completed her Executive MBA there. Janet’s origins are in engineering and she
spent her early career working for ICI, Zeneca Pharmaceuticals and Dyson. Her main research
and teaching interests are in exploiting the links between marketing and supply chain strategy,
to develop market-led or customer responsive supply chains.
Andy Birtwistle is an internal supply chain strategy consultant for BAT, where he has
been involved in the re-engineering of the BAT supply chain at both a regional and group level.
Prior to this, he was a supply chain consultant for Accenture.

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