Executive summary:James Pierce, newly appointedgeneral manager of the Jackson plant of the Rose Company, have responsibilitiesof achieving cost effective production with keeping high quality by implementingnew methods of production prior to starting new plant through testing the valueof a decentralized operation. He has capabilities and personalities whichsuitable for leading change, however, does not have a concrete power, networksin this plant, expertize in production, and he expects to face any resistance.In this situation, he tries to implement the change to build a strongrelationship with empowered followers while controlling the power of resistanceby January 2019. Situational Analysis:James Pierce has just been assignedas a general manager of Jackson plant,established units of the Rose Company.
Pierce would have responsibility for themanagement and administration of all functions and personnel, except sales, at theJackson plant. Pierce will require setting a goal for the organizationchange, and the strategyto aim the goal first. Therefore, Piercewill require the situation analysis with various data, havinga communication well with management, middle managers,and employees to find recent issues and problems. After all, Pierce will realize that the key success factor willbe to obtain the agreement of cooperation with people to move forward the changeon time schedule. Pierce will analyze the situation,problems, and solutionalternatives. Lastly, Pierce will set asolution and its implementations.
To analyze the situation, first, Piercehas analyzed the Jackson plant, he hasfocused on the report line and the organizational structure. The manufacturingoperations and certain other departments have been under the supervision andcontrol of a senior vice president. The company has operated a highlycentralized and functional type of manufacturing organization for a long time.There was no general manager at any plant at all. Each of the departments in theplant has reported on a line basis its functional counterpart at the homeoffice. Second, the topmanagement of the Rose Company has concerned regarding the advisability of thecentral control of manufacturing operations.
The officers have decided to testthe value of decentralized operation at the Jackson plant because the record ofthe Jackson plant has not been satisfactory for several years. Therefore, the board member apparently has believed that thegeneral manager at Jackson plant will be needed to know if the new experimentin manufacturing methods and the required rebuilding of the organization willsucceed. This is the reason why Pierce has been assigned as a general manager.Meanwhile, the Rose board hasapproved the erection of a new plant in a different part of the city and theuse of new methods of production recently. Both lower costs of processing andreduced manpower requirements have been needed to maintain competitiveleadership and gain some slight product advantage. Hence, the goal of Pierce is the success of the decentralizedfactory to reduce the cost.
Pierce will require providing thestrategy as soon as possible after the situation analysis, havinga communication well with the management, themiddle managers, and the employees to find recent issues and problems. The newdecentralized factory would be favorable for the board members. To meet thegoal, Pierce could delegate the tasks tomanagers with setting the time schedule. Considering these situations, the urgency pace of change should be urgent. In addition, Piercerequires to know himself because he requires delegating the tasks to relevantvice presidents and managers efficiently.
Therefore, here inthe situation analysis requires the assessment of Pierce’s strengthand weakness because Pierce needs to know his own capability and capacity toobtain the agreement to collaborate with people. According to thetop management, Pierce’s strength will be the analytical capability, the general administrative capacity, and he will be liked by people. In addition, the toughness, theability to achievement for the important tasks, theimprovement of the efficiency and the aggressiveness to reach the goal arehighly suitable as a general manager.
On the other hand, he usedto be an accounting executive in the controller’sdepartment of this company,therefore, there is noexperience such assignment in his business life. In addition, since he is too aggressive to achieve the goal and he has noconnection with Jackson plant, it is possible that the employeesof the plant would not accept Pierce’s way asa perfectionist. According to Professor Kainen’s Lecture Note, a method for making change is tosee the need ahead of time and make the adjustments necessary. This requiresmore skill on the part of managers. It requires them to convert the outsidepressure into a “force” for change thathas direction and speed. To be successful at this conversion process, managers need twothings: (1) Analytic ability -Analytic ability allows them to diagnose the problem and create a solution (change), and (2) Power – Powergives them the capability to implement the change.
Power is required to getthings done. This applies to both the management operational responsibilities, and the managementof change. However, tobe effective managers must supplement their power with COMPETENCE, TRUST, AND LEADERSHIP. *1 It meansPierce’s characteristicsare highly suitable for a general manager to change the organization because hehas both the analytic ability and the power to aim the goal to change. However, he requires the agreement of the cooperation with theemployees especially vice presidents and managers obviously. Problem analysis:The most critical issues of thischange are the existence of resistances which might impede his success and Piecedoes not have a plan for that. Pierce also does not have all power controlsince some of the vice presidents does not allow Pierce to have total controland discretion in the new system.
As a result, thereare two different patterns of relationship between the plant and home officeand it will cause conflict between Pierce and middle managers who still connectwith those vice presidents. In addition, theremight be other potential issues and resisters which have not been determined ordiscussed yet. Considering these situations, heneeds to provide the strategy to make a success as soon as possible.
Withoutsolving the critical issues, thechange cannot proceed. As we mentioned in situational analysis, to make a success of the change, amanager should have Analytic ability and Power. Piece has a leadership and hisstrength of analytical ability. For his powers, he hasauthority as a general manager,responsibility for rewarding, connectionwith home office, emphasized ascompany’s efficiency expert, and his character of toughness,aggressive in reaching the set goals. His credibility and reputation from otherpeople are also well. However, hisweaknesses might affect negatively accomplishment of the goal. For example, he has less power in his network since he is almostunacquainted with anyone in Jackson plant. Also, this ishis first assignment as a major line job.
Therefore, his power as the expert isweak. There are some resistances which we can be considered as potential issuesin implementing the change. One resistance will happen in the implementationphase.
It is that the change or another decision making may be delayed by vicepresidents. They basically will not have the direct control of Jackson plant inthe new structure. However, asLarry E. Greiner (1998) states, it is difficult for top-level managerswho previously were successful at being directive to give up responsibility tolower-level managers.
*2 In fact, some ofthem are going to remain their direct connection with plant-level managers as adotted line. This may allow meddling of vice presidents, andaccordingly, the transformationwill be delayed or not happen. Another issue will happen in theplanning phase. The absence of proper person of The RAPID Decision model *3 (Rogers& Blenko, 2005) would cause reverse to the current system from the newsystem.
The new plan tries to aim to the decentralized organization but thereare resistances who would like to maintain current centralized model. Theimplementation of the new system for Jackson plant might fail or delay if Piercedoes not have the person who can get agreement and input properly with vice presidents who disagree with decentralizedrelationships. Therefore, heshould have a good communication and develop positive supports with management, middle managers, and employees to support his change. As a problem recap, Pierce does nothave a complete power to lead the change by himself due to company’s structureand his lack of expertise. Furthermore, it is likely to be expected to beresistance from middle managers (in Jackson plant) who have the dot-connectionwith the vice presidents in head office.
Alternative Solutions:Option 1: Pierce has the weak internalconnection in the plant. The decision making for the new implementation will bedone by top management and it means that he cannot handle the new organizationChart’simplementation by himself. Therefore, heneeds to establish the strong relationship with high-level-power who wouldsupport his plan by having accurate situational analysis, wellcommunications, andreport of current situations of the middle managers and employees. In addition,in order to lead the change, Pierce should builda firm relationship with as many middle managers as possible inJackson plant by letting understand the necessity in change and controllingtheir rewards and goals, then creatingchange-leading team. In doing so, Pierce should control all of the plant employees by fostering a sense of participation.Pros:• Pierce can avoid resistancereaction because people do not fight back against many managements who havehigh-level powers.
• Pierce can provide the report withthe specific date to the top management so that credibility of him will beincreased.• By creating a change-leading team, Piercecan catch up lack of expertise,influences, and network.Cons:• Pierce might get a poor evaluationfrom other managements because Pierce does not solve the problem by himself.• Pierce might not get centralitydue to relying solely on higher-level power.• Implementing procedure iscomplicated and it holds the key to success. Option 2: Create “small” project teamand Utilize subsidiary compensation system. Smallproject team which is composed of some members belonged to differentdepartments. The purpose is to “cast” Piercein the role of General Manager.
The small project team must require “inter-departmentadjust function.”Therefore, theposition of General Manager is inevitably emphasized. In addition, Pierceshould prepare for subsidiary compensation system to boost tasks of the smallproject team.Pros:• Employees cannot help utilizing NewOrganization Chart.• Employees can obtain opportunitiesto communicate with other departments directly without attaching the mostimportant to each department’s vicepresidents.Cons:• Employees might do additionalworks due to the small project team.
• Management cost might be increasedbecause of inter-department. Option 3: Connecting the changeprogress directly with evaluation of the plant level managers can beconsidered. In other words, he can use rewardssuch as bonus and promotion to motivate the managers.Pros:• It is easy to implement since Pierce already has the right to do it.• It does not take time for building a relationship is not required.
• It can be a great motivation since money and honor are commonly valuable.Cons:• This is kind of a cool approach. Thus, it may not build a real trust between him and themanagers. Recommended SolutionWe recommend Option 1. Piece can avoid resistances and achieve theorganizational change by utilizing commitment of top executive and by obtainingpowerful driving force from a bottom-up approach. To impose the change, Pierceshould create people will be under a mood of the pressure, but at the currentmoment, it hasnot happened severe problem which is visible for employees. In this situation,the pressure which can foster the necessity for change is considered as powerfrom the top management.
Furthermore, Pierce does not have enough power officiallyand unofficially to completely control his followers. The power from topmanagement will make the effectiveness of resistances weak and move on to thechange. In addition, byfollowing steps involving majordesign change *4 (Goold &Campbell, 2002), heneeds to assign new role and responsibility for the new units with the bestperson who would move the change forward. By assigning the appropriateperson who would support Pierce’sassignment, itshould minimize the risk of resistance in the future. To drive the change forward, Piercecannot achieve it by oneself. His role is to create an organization withvoluntary cooperation by letting all of the employees share the same objectiveand motivating them through empowering. In this case, As Todd Jick(1991) noted,Pierce should design a gradual non-threateningand, preferably, participative implementation process including the followingtactics; Explain change plans fully, Skillfully present plans, Make informationreadily available, Make sure plans include benefits for end users and for thecorporation, Spend extra time talking, Ask for additional feedback from theworkforce, Start small and simple, Arrange for a quick, positive, visiblepayoff, Publicize successes.
*5 To build the relationshipwith as many as middle managers and create a propulsive change-leading team,First, Pierce should communicate with all of the employees in Jackson plant andtell the necessity of change and call for cooperation. Second, he should hold ameeting with candidates, do theevaluation and identify proper persons who meet his requirement of passion forchange and agree on the importance of change to decentralize. Then, create the teamof leader by electing the leader from each department and foster voluntarycooperation by empowering while making consensus in the leaders’ meeting.Creating the team of leader also can catch up his lack of expertise in productionprocesses and human network.
As stated above,Pierce can have a concrete power tolead the change, networks in this plant, and expertise in production. Implementation: From our analysisabove, Pierceshould implement the change with “Top-commitment” and “Leadership” in thefollowing timeline to meet the goal, whichis the decentralized plant by January 2019 (we make this implementation plan underthe assumption start from January 2018 and complete one-year time frame). (1) Every time until January 2019:Using top manager’s powerfor decreasing Pierce’sresistances. For instance, if oneresistance interrupts his action, hemakes the tops control the resistance.
(2) Every time until January 2019:Communicating with employees for establishing a rapport. For example, heholds a lunch meeting once a week and has a frank heart-to-heart talk.(3) January 2018: Electing projectleaders from each segment.
(4) February 2018- March 2018: Openinga meeting for project leaders and defining the strategy through the discussion.(5) April 2018- May 2018: Askingleaders to settle each segments’ finalgoal and their short objectives for attaining the goal.(6) May 2018-June 2018: Defining thepolicy and the schedule of the action in the meeting.(7) June 2018 -January 2019: Opening theconference with leaders for confirming project leaders’ process reports once a month. If he findsout that they cannot proceed with their strategy in the meeting, Piercemakes leaders explain why they cannot succeed with the plan as scheduled andhow they will improve it.