1. INTERNATIONAL BUSINESS & STRATEGY
INDIVIDUAL ASSIGNMENT II - (FINAL)
AHMAD REZA KHAWAR (@00450058)
UNIVERSITY OF SALFORD
MARCH 1, 2016
2. Contents
1 Introduction ..........................................................................................................................................1
2 Leadership and Organizational Change ................................................................................................1
2.1 Leadership in Organizational structure.........................................................................................2
2.2 Organizational Change Management ...........................................................................................4
2.3 Empowering Employee in cultural change. ..................................................................................4
3 Performance Management Systems.....................................................................................................5
4 Organizational Transformation.............................................................................................................6
5 Conclusion.............................................................................................................................................7
Bibliography ..................................................................................................................................................9
3. 1
1 Introduction
In today’s competitive world change is an integral part of the business, many theorists have emphasized
the importance of change for organizational survival, and with rapid adaptability of creative and
technological innovation into businesses the management of change is ever more imminent.
Businesses and organizations are prone to changes in the external and internal environments which drives
the organization/business to change accordingly. To cope with this change, a proper change strategy is
required to drive the organization in consent with the vision of the organization. Defining change strategy
for the organization requires a detailed understanding of the values, vision, mission and objective of the
organization. Application of changes to the organization verily affects the organization value but the vision
and mission of the organization should remain same. Organizational change can sometimes take the
shape of organizational restructuring which affects the authority level and leadership of the
organization/business.
Organizations consist of different layers, each of which has its own influence to the organization and its
value but all follow same vision and mission of the organization. These layers include, but is not limited
to, managers, senior executives, executive directors, board, investment managers, trustees of funds and
beneficiaries. However different the roles and work of these layers are, the aim of all layers remain the
same that is to keep the organization market value in sustained position.
In consequence, organization’s value, however large it has to be, depends on each layer. Respectively,
when defining strategic change, it is advantageous, sometimes even important, to consider ideas from all
layers of the organization who has influence on the organizational value.
This paper is intended to discuss the theories and practices of change management in the context of multi-
national enterprises MNE. The report will be concentrating on transformation of organizational culture
from a tight management to a culture empowering the employee when making decisions.
2 Leadership and Organizational Change
From leadership perspective, the need for strategic change in an MNE can emerge from various factors.
A situation where the organization is losing its value in the market, for instance, necessitates the
formulation and implementation of a strategic change in the organization. This situation can be caused by
unsatisfactory product deliverables or miscommunication among the departmental units of the
organization or even the implementation of too much bureaucracy in the process. Today’s business world
is rapidly changing, and an organization can easily lose its value if it does not keep a good competitive
advantage over its competitors. This is another factor that compels the leaders to implement a strategic
change in the organization. However, strategic change does encompass some challenges and is not always
4. 2
welcomed by the people. Employees are mostly inclined to their own ways of work and shows resistance
to any change in their work process and procedures; this is referred to as inertia or resistance to change.
Sometimes, application of change in the organization requires the down-sizing of the organization, in
which some employees will lose their jobs. These challenges should be anticipated in order to cope with
before defining strategic change for the organization.
Identifying problems that are stopper for the organization prior to defining change strategic of the
organization is one of the foremost requirement for any strategic change. This will help the management
to plan and define the right strategic change for the organization. “Change management is a structured
approach to transitioning individuals, teams, and organizations from a current state to a desired
future state, to fulfill or implement a vision and strategy” (Levy, 2007).
This report discusses change management and strategic change in a multi-national enterprise (MNE)
having a culture of tight performance management where the objectives are strictly defined against which
performance is evaluated. Such organizations mostly tend to have a centralized management system
where the top management are the decision makers and the middle and lower management levels are
not involved in the decision making. It is most likely that these organizations lose their values in the
market. Defining strategic change to transform an organization from a tight culture to one in which
employees can have input in decision making and their creativity and initiation skills are promoted by
allowing them to perform their works creatively, is not an easy thing. It requires an in-depth
understanding of the organization and its internal and external environments in order to consider any
possible causes or reactions by these environments to the organization and its strategy. SWOT analysis,
of course, is very helpful to draw the right path for leadership in definition of strategic change.
When embarking on strategic change within organization it should be applied from top-down manner;
the top managers should accept and apply the change first because they have influence on the rest of the
organization then the middle-mangers and the rest of the team will follow and apply the new change.
Otherwise the change will be unrealistic to be supported by rest of the organization team. “Alvesson
(2009:255) says that to be able to accomplish a change we have to start with changing people’s
values and ideas hence making people behave in ways they are not used to” (Rosén, 2014).
2.1 Leadership in Organizational structure
Leadership in organization structure, are the key people which bring teams together and enable them to
work as one team to achieve the common goal of the organization. Sitting a common goal and motivating
individuals to cooperatively work on the specific goal within the organization, leadership ensure the
organization drive in its right path. Involving the rest of the organization team while making decision such
as applying strategic change, creates tendency within the team to move cooperatively with the
organization leadership to apply the change. The leadership is the final key people to make their decision
either they apply strategic change or cultural change within the organization or apply both. “A leader is
5. 3
an important actor in a change process. They are the ones responsible for making the process
as smooth as possible” (Rosén, 2014).
Figure 1 : Without alignment, the best strategic plan will never be fully achieved (Rick, 2013)
Traditional leadership in organizational context was structured and have rigid line of command and
control structure, usually leadership powers were dependent on the position of the leader, but in today’s
fluid business environment where smaller multinational teams and skilled labor is the norm, we need
different types of leadership where everyone feel they have a say in organizations development and
contributing to long term goals.
From the leadership style the tight management comes in Autocratic leadership style which all decisions
are made by the organization leadership and the teams must follow as order their leadership decision.
Moving from autocratic leadership style to Democratic leadership style which is the base requirement for
the organization as cultural change is time-consuming task. The democratic leadership style is the
optimum style to empower the organization employees while build their trust and enabled them though
making preforming their own decisions. “Leader seeks continual feedback and looks for
opportunities for development for both himself and for his or her team. This is a popular style
6. 4
because when it is done well, it creates a harmonious, productive, evolving work force” (MTD,
2010).
Today’s business leaders need to understand that their success as individuals as well as businessmen
heavily dependent on how they integrate better change management practices into daily business
operations.
2.2 Organizational Change Management
In today’s dynamic multi-national organizations change should be managed more on participator terms
rather than traditional command and control structure, everyone should show a commitment to
organizational changes for long term sustainability and viability of the organization.
These organizational changes could include flexible working hours for some, variety of remuneration
schemes, different levels of skill sets, relaxed working environment, adaptive organizational cultural
norms and greater acceptance of diversity.
These and many other changes are required for organization to cater for different types of customers,
today’s organizations are more universal than their counterparts as decade ago, therefore newer and
better approaches are required manage organizational changes successfully.
There are two type of strategic-nature changes in organizations incremental and big bang, depending on
the organization type and status. When an organization plans to improve the quality of services via skilled
employee they will start incremental strategic change which is usually very time consuming, but when a
crisis struck an organization, there is little time for incremental changes, we opt for big bang, basically
changing everything. Meanwhile, according to (Scholes, et al., 2008) in long terms organizations can
choose mainly from four types of strategic changes they are Adaption, evolution, reconstruction and
revolution.
In context of changing the organization from tight management into employee empowerment the
revolution change approach is ideal way of change for an organization. “This could be in circumstances
where the strategy has been so bounded by the existing culture that, even when environmental
or competitive pressures might require fundamental change, the organization has failed to
respond” (Scholes, et al., 2008).
2.3 Empowering Employee in cultural change.
Employee are considered to be the best asset of an organization. When the organization employee are
empowered the processes are efficient, the services quality is improved, teams are responsive and
dynamic and finally all employees work as one to accomplish the organization goal. In most cases tight
managements cultural increases bureaucracy in a process resulting in slower work, however in same
organizations tight management is a requirement, like some government organizations, tight
management are useful while in private business organizations context the tight management will act as
show-stopper or barrier for the employees while preforming their jobs.
7. 5
Moving from tight management culture to employee empowerment culture it is required that a good
strategic plan should be in place to align the organization with the successful change requirements,
meanwhile organization leadership should providing tools, training, encouragement and motivation to
their employees and lead from front in these unchartered waters. “For staff members to feel
empowered, they need to believe that management communicates a clear direction for the future,
that they are working in alignment with the CEO and board, that the foundation cares about them,
and that their performance reviews are fair and helpful.” (Ellie Buteau, 2012)
“Rather than top-down management, there is the need here for people throughout the organization to
accept the responsibility for contributing strategic ideas, for innovating, and for accepting change as
inevitable and desirable” (Scholes, et al., 2008). The inclusiveness of change management process and
listening to “everyone” encourages optimum performance at every level.
The organization leadership/management should establish a trust between their employees through
communication and enable their employee to believe on their skills while preforming any tasks within
their job descriptions. “When you show an employee you trust her, and give her timely information
and the authority to find solutions, she will be able to solve problems and provide solutions more
rapidly than someone without that empowerment” (Regina Anaejionu, n.d.). Realize when the
employees are empowered, subsequently it will bring about the following impacts to the organization:
creativity, satisfaction, loyalty, decision making, collaborative growth, increase in productivity and quality
of work produced and reduced organizational cost (Williams, n.d.).
3 Performance Management Systems
The majority of organizations still treat performance management as once or twice a year practice, where
you see a bunch of forms filled by supervisors and employees for an activity(ies) which have taken place
almost a year ago.
Today’s employees need instant feedback on their performance, and technology is a key consideration in
this equation, Organizations have to adopt and adapt technology in manners where it’s always
commending and empowering existing capabilities of the entity.
Performance management needs to consider modern organizations realities, today’s employee is more
knowledgeable, skilled and informed than his/her counterpart a decade ago, they need power to make
decisions, flexible hours, creativity and free hand in carrying out their duties.
Our modern workforce is younger, energetic and multi-national, though performance management
systems are good to have in organizations, but majority of them beat the purpose.
While designing or transforming the legacy performance management systems, today’s realities need to
be considered, we need to give clear values to creativity, decision making, communications and other
8. 6
soft-skills that are hard to come by in every day to day employee. “Job analysis techniques, such as
job observations, interviews, focus groups and surveys, are used to identify key competencies
and associated critical work behaviors” (Pulakos, 2004)
If organizations need to be competitive, they need to harness the culture of creativity, adaptability,
respect and cultural diversity, and the best way to encourage these values in employees we need to
systemize them through proper performance management systems.
Many technology firms pioneered technology enabled performance systems, which understands modern
employees working ethics, we hardly work in structured office environment, we access our official emails
day and night, respond to customer inquiries whenever required, carry our laptops home, so basically the
distinction between private and official life is almost over.
Considering these and other modern working life realities, performance management systems must focus
on empowering and motivating employees to deliver high value work, irrespective of where, when and
how it’s done.
4 Organizational Transformation
Organizational leadership plays a key role to transform organizations from traditional to modern adaptive
entity, Organizations are living entities need to continuously innovate and adapt to survive.
The leadership in organization set the path to transform in longer period of time, in today’s competitive
environment where a fresh entrant can compete with an established organization makes the
transformation much more imminent.
The organizations need to adapt and the leadership need to understand how to manage the changes
which are required for an organization to be nimble and agile, the PMI (Project Management Institute)
reports “Organizations that are highly agile, nimble and able to respond quickly to changing market
dynamics complete more of their strategic initiatives successfully than slower, less agile
organizations (69 percent versus 45 percent). But only 15 percent of organizations report high
organizational agility.”1
For successful implementation of changes in organizations, it’s critical that leadership strongly believes in
organizational transformation and cascade that believe into lower and mid-level management, change is
stressful time, and it requires a lot of patience and persistence with the understanding what our long term
goals are.
1 PMI’s Pulse of the Profession: The High Cost of Low Performance, February 2014
9. 7
Organizations need to understand that today’s workforce is differently skilled with varied backgrounds,
to cater and keep them motivated we need to transform our organizations into something which foremost
understand the different issues faced by the workforce and secondly addresses the customer’s needs
whenever required.
Figure 2 (speedoftrust.com, n.d.)
5 Conclusion
In our today’s globalized economy we compete globally, our customers are from different parts of the
world, our products are shipped into different geographical locations and our employees are of different
nationality and in some cases may even work in different locations.
In this kind of environment it’s ever important that the Organizational leadership understand that their
employees are motivated differently and will require certain degree of autonomy in decision making and
will need to address their job creatively.
The traditional approaches to motivations and performance management are lacking in many ways and
will need to go through considerable changes before it can address today’s workforce expectations.
In this paper we have discussed that, it’s imperative for organizations to adapt and transform itself into
an entity, which caters for it’s multi-national employees and encourage them for creativity and provide
them certain degree of autonomy in their decision-making.
We also emphasize the key role of leadership in managing these changes and applying policies on a global
level, where culturally, religiously and economically people are motivated and treated differently.
The speed of change is ever increasing in today’s business; irrespective of the organization type or size for
survival and customer acceptance, organizations need to adapt and be responsive, basically meaning
changing continuously in light of the customer expectations.
10. 8
Today’s organizations are expected to respect different values within and outside their environment,
today’s employees come from variety of backgrounds, they are multi nationals, with different religious
and cultural believes, a single global policy on an organizational level in many instances cannot do the
justice, therefore it’s required that certain level of creativity and decision making is allowed for everyone
to perform their duties.
Today’s executive need to understand that operating today’s successful organizations needs a lot more
than simple technical skills, our business leaders must understand that modern employees are better
educated, informed and connected, and need certain level of autonomy in performing their jobs; the
leaders must also understand that today’s performance management systems must adapt to these
changing environments and should consider creativity and decision making as critical skill set.
11. 9
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