Introduction
This change management analysis report is based on the change process at Tesco Plc. This is the largest retailer in UK and third largest in the world. The technological change in the organisation was important in improving accuracy and efficiency. Although change is inevitable, resistance was not avoidable either. The report first provides the sectors and elements of the environment considered to have had the most influence on the change within Tesco Plc. Second, it provides the advantages and disadvantages of the change. Third, it evaluates the sources of resistance during the organisational change process and provides ways in which the management tried to combat them.
Sectors and elements of the environment considered to have had the most most influence on the change
The major sectors that had most influence on the change process were international, socio-cultural, economic conditions, technology market, financial resources, human resources, and the retail industry as a whole (Miles & Snow 1978). The new technology was adopted as a result of advancement in technology and e-commerce industry. Moreover, competition from closer rivals in the UK such as ASDA and Sainsbury prompted the company to adopt new technology. This was necessary as it would promote competitive advantage in addition to differentiation from its rivals and competitors. The change was prompted by social cultural elements such as consumer demands, education, values, and age. For example, it was important to meet the demands and expectations of ‘connected customers’ (Kirby & Marsden 2006). Moreover, it was necessary to create a shopping experience for ‘connected customers’ and other consumers through efficiency and accuracy. As witnessed in the technology sector, technology advances have totally changed the face of business, and for that reason, Tesco could not have been left out of the change. Moreover, the change was necessary because majority of the employees and management at the time were baby boomers (Griffin 2012).
New technology has the capability to connect suppliers with the organisation, especially the supply chain and logistics department. Thus, the raw materials sector which comprises of suppliers influenced the need to improve accuracy and flexibility in stock record keeping and ordering. This not only reduced the time required but also had much influence on its success. The market is flooded with a new generation that is technologically savvy. Therefore, to accommodate them in the labour sector, the human resource sector was challenged to overhaul its old technology system by replacing it with a new one. With respect to financial sector, the company needed to cut down its costs of production and efficiency. This could only be realised through the adoption to a new technology.
Uncertainty is a major factor that had influence on external elements impacting change process. For example, technology obsolescence affected the change management plan because modern technology is ever changing replacing hardware and software much often. Therefore, the uncertainty on whether the project would be completed before the technology become obsolete had influence on the change process. Organisational culture also had influence on the change process. For example, Tesco has a shared corporate culture which promotes adoption of new technology to remain relevant and competitive in the market (Cummings & Worley 2004).
The advantages and disadvantags of the changes
Advantages of the changes
Organisational change has different associated advantages and disadvantages. In reference to the change in operations at Tesco Plc, the introduction of digital electronic point of sale (EPOS) which is an upgraded version of the existing EPOS shall increase the levels of accuracy and reduce delays in different Tesco UK’s departments. In this context, change in the organisation will result to improved operations. For example, adoption of a new EPOS shall make the system more efficient and functional. The implication made is most of the work which was performed manually shall be computerised, thus saving time and energy. In the workplace, the change shall ensure that employees do not waste time on similar tasks. Moreover, it will be possible to record employees work rate which is vital in evaluating employees’ performance (McDonough 2009). Given that the world has become digitalised, the use of the new technology shall ensure that credit cards are easily read at all points of sales without any challenges.
The other major advantages that are associated with the change are “: meeting the demands of a new generation of ‘connected customers’, solving the problem of ‘showrooming’, in which sales are lost online, and brand building, using Digital POS to create differentiating and choice-shaping store experiences” (Kirby & Marsden 2006, p. 1). The implication made is that new EPOS shall make sure that Tesco meets the demand of new consumers, solve show rooming problem, and differentiate itself from other retailers. The latter shall create a competitive advantage over other players in the industry such as Sainsbury and ASDA. A change when implemented creates a room for competitiveness and allows organisations to develop new skills that maximise of profits (McDonough 2009). Other than strengthening its competitiveness, the technological change shall enhance effective decision making process. For example, it would be more efficient to determine which products require promotion or which require a boost
Technological change in the organisation shall bring the opportunity for employees and staff to try gain new skills. Moreover, it shall assist majority of the employees realise the change was necessary after it reduces the time they spend on manual calculations (McDonough 2009). Since the change is internally imposed, it shall increase employees’ morale, empower them, and challenge their abilities, which in return shall increase productivity. The change shall result to better informed management, provide a scalable solution that matches the growth of the company, and allow effective delivery of information.
Disadvantages of the changes
There are, however, a few disadvantages associated with the change to take place in Tesco. For instance, if employees’ resistance is not dealt with effectively through negotiations and communication, the change process shall be derailed resulting to losses and waste of time. Installation of digital EPOS is an expensive venture that requires human and financial resources. Therefore, Tesco shall be required to invest heavily while installing EPOS in its 1,200-plus stores (Meaney 2010). Moreover, training and development of employees is a must undertake venture. This means that for the project to be successful, again Tesco has to invest in external consultants and experts to train employees on how to use and maintain the new technology (Meaney 2010). The software requires regular updates and maintenances which is a costly affair. To remain competitive and maintain a competitive edge against rival company systems, Tesco has to update the system often to avoid technological obsolescence.
McDonough (2009) states that poor understanding of the organisational culture results to circulation of corrupting or wrong information by rumour mongers on the change being carried. Therefore, a successful change process requires involvement of different stakeholders, and this is only achieved through effective communication. Poorly executed change management plan is most likely to affect Tesco negatively. Failure to follow the different change management strategies and models may bring the entire company to its knees. Change results to loss of control, because it interferes with leadership autonomy (Kanter 2012). For instance, it was hard for some managers to accept the change because it interfered with autonomy. The structure of the organisation affected the process in regard to departments and positions, integration and differentiation, and control processes (Senior, & Swailes 2010).
The sources of resistance and how managemnet solved them
The introduction of new EPOS system in Tesco Plc which is the largest in the UK was a success although it was faced with certain resistances. The change in the organisation was carried to change the existing system and incorporate one which reduces delays and improves accuracy in operations. The change which was carried in collaboration with different departments was necessary to promote flexibility and reduce management and operations cost (Senior, & Swailes 2010). It is vital to note that the change was planned and different stakeholders were involved in the change process (Kerber & Buon 2005). Despite the involvement, resistance was evident because not all people support change.
Major sources of resistance
There are multiple reasons why change is resisted despite that fact that it is inevitable. Senior and Swailes (2010) borrowing from Adams (1987) has outlined the major obstacles to a successful change management within an organisation. The major sources of resistance are classified as perceptual blocks, emotional blocks, environmental blocks, cognitive blocks, and cultural blocks. In reference to the change in Tesco, emotional blocks were the major causes of resistance. For example, there was a fear of adopting the new technology supported by lack of capacity to effectively tolerate ambiguity. There was fear that the change may not take place in the stipulated time frame which caused resistance from a section of employees in the sales and marketing department (Sirkin, Keenan & Jackson 2005). Moreover, the change was resisted because it threatened power and jobs of some employees in the organisation. The fear of being rendered redundant scared employees, especially the baby boomers in the organisation. Baby boomers who form the largest part of Tesco management resisted the change because they were not tech savvy and saw the change as a way of giving out their power to generation X employees.
Incapacity to tolerate ambiguity in regard to the new solutions resulted to resistance. For example, ambiguity and stress was high among among matures, baby boomers, and generation X than in millennials as a result of difference in technological experience and ICT awareness. Other than lack of interest on the new technology, high levels of unwillingness among “matures” and baby boomers was high because of uncertainty and difficulties in operating EPOS. As such, the change almost stalled. Moreover, baby boomers did not share the same vision as generation X in increasing accuracy and reducing through EPOS, hence change resistance. Since new skills and expertise were required, some employees become resistant to the change because they lacked the necessary skills. Moreover, some of the employees felt more comfortable with the existing technology they have been suing. Besides, some felt that they outcome of their status quo was unpredictable. This is because of the corporate culture that had been in existence for a long period and the systems calls for immediate change, made the employees more hesitant to the changes being made (Senior & Swailes 2010).
Kanter (2012) has stated that “if change feels like walking off a cliff blindfolded, then people will reject it. People will often prefer to remain mired in misery than to head toward an unknown” (p. 1). This means that change is resisted because of excess uncertainty. Some of the baby boomers and employees with low technological know-how were hesitant because of excess uncertainty associated with the change. Concerns related to competence also resulted to resistance to the change by employees in Tesco (Kanter 2012). Although the people knew that the new technology would result to accuracy and improve performance, some were worried because their skills would be rendered obsolete. Others were afraid of ripple effects associated with change management. According to Kanter (2012), “the ripples disrupt other departments, important customers, people well outside the venture or neighbourhood, and they start to push back, rebelling against changes they had nothing to do with that interfere with their own activities” (p. 1). The implication is that people in other departments apart from marketing and sales and information communication and technology were worried of the ripple effects caused by the new technological changes.
Change is resisted because it hurts deeply. For example, displacement of old technologies with new ones in Tesco meant that jobs would be lost, investments would be wiped out, and prices would be cut. Because of low work performed by the employees, it meant that there was a possible salary cut which threatened some of the employees (Kanter 2012). Senior and Swailes (2010) have noted that employees resist change because of cultural blocks such as change and tradition. Adopting a new technology was resisted because new rules and technology was necessary to break the tradition that has been there for the past years. Another reason for resistance was fear of resources reallocation by some leaders (Kanter 2012).
Combating change resistance
To overcome the resistance of the changes from the employees, the three stages of Lewin model advocates for motivation of the employees (Wirth 2004). Motivation of the employees is aimed at ensuring that they buy out the anticipated change and become the part of the whole process. This was incorporated through the use of motivation strategies such as pay hikes, better working conditions, flexible working hours, through appreciation, training the employees, and issuance of bonuses and other incentives (Biech 2007). This strategy has been supported in the 8 Kotter’s steps model where, Kotler advocated from the creation of short-term wins (Carpenter, Bauer & Erdogan 2010; Cameron & Green 2004). The short term wins were strategically placed to woe and motivate people who have been part of the change. The motivation was carried through the reward systems where some of the tools used included pay hikes, bonuses, vacations, retreats, and occasionally promotion to those who portrayed more leadership qualities and enthusiasm. This process was incorporated in to remove any obstacles to change (Kottler 2007).
To encourage employees to be part of the change, the leadership of Tesco invited other people into the change process, in addition to communicating the change to them. Moreover, the management team created certainty process supported by clear and simple timetables and steps (Kanter 2012; Burnes 2004, Burnes 2004a). Investment was also done in structural reassurance, training, support systems, consultants, and mentor to provide time and the right information. To ease the transition period, two systems were used simultaneously. Stakeholders were also involved to minimise disruption caused by ripple effects. Above all, the major sources of resistance were diagnosed and feedback got from resistors so as to improve change acceptance process (Kanter 2012; Carnall 2003). During the transition period, communication, involvement, open negotiation and empowerment are some of the measures that were undertaken to ensure full implementation of EPOS (Weiner 2009). This was supported by the management commitment (Burke et al. 2004).
Borrowing from the Lewin’s three-stage model of change management (Schein1996), resistance to change was reduced through in the last pace through training personnel maintaining a regular meeting review, reward and performance systems establishments, carrying analysis to note and eliminate any possible barriers, and celebrating success as part of encouraging change process (Al-Mashari & Zairi 1999). Confidence was restored among employees and affected people compensated handsomely during the restructuring and downsising period (Nwagbara 2011). Overall, communication, motivation, and collaboration were the primary solutions to combating with the resistance.
Technological:
As mentioned in the last paragraph technology has driven the telecommunication industry over the last two decades and companies in the industry have to keep monitoring the technological changes and come up with innovative products and services that reflect the current technological trends (nap.edu). The emergence of new phone devices and other communication devices has led to the growth of the industry and hence companies have been using the new technological advancements to create a competitive advantage in their products and services. Some of the key factors that affect telecommunication companies are advancement in broadband communications.
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