Introduction
The ability to change and flexibility are important for the success of any organization. By using change models, businesses can assess the necessity for changes within their organization. Some of the changes that a business makes depend on the strategic plan, personalities of the employees, and the leadership styles that the employee’s personalities require. Our team has been asked to examine the differences in change models, leadership styles, challenges with change, and success factors of multiple organizations. By doing so our team can gain a better understanding of what models are appropriate to the organizations and how critical those models are to the organizations’ success.
General Electric and Chrysler – Tawana Keels
General Electric
At the time, Jack Welch became CEO of General Electric the companies market value was $13 billion dollars, in 2000 when Jack Welch stepped down as CEO, market value was over $500 billion dollars, GE had became the most valuable company in the entire world (General Electric, 2010).
When Jack became CEO, he attracted plenty of attention, although he was known for being a transformational leader, he was also known for being direct and abrasive, this much different from his predecessor (Business Week, 2004). Although he did not have a master plan for restructuring GE, he had a vision of what he wanted the company to be. Like CrysTel CEO, Jack Welch knew his company had to be flexible and adapt to constant change. Additionally, he knew the company would need a complete restructuring and a dismantling of the bureaucracy that existed within GE. But the concept of change would not be completely accepting by the staff at GE.
Similar to CrysTel, Jack Welch encountered a great deal of resistance to change. According to our class material, resistance to change is an emotional response to actual or imagined threats to an established work routine (Kreitner & Kinicki, 2004). Unfortunately, not all people have positive responses to change. Resistance to change is by fear, lack of trust, and unwillingness to discover new ideas.
Implementing his vision would not be easy; his response to this issue would be swift and aggressive. He would initially sell off many unprofitable business lines and began trimming GE from “top down.” Second he would introduce the “Work Out” concept, a results-focused approach to solving problems (Business Week, 2004). Last, he would implement a quality program, which would process efficient first-class products.
Although his response was swift and aggressive, they would put GE in an excellent position. However, during his first tenure, Jack would conduct mass lay-offs, more than 100,000 workers (25%) of the workforce would lose their jobs (Business Week, 2004). The outcome would garner many critics. Although his management strategy tends to more controversial, his contribution to General Electric will never be disputed.
Chrysler
America has been in worst economic situation since the Great Depression of the 1930s. Most businesses in America have seen a steep decline in consumer spending, which has had a considerable affect on the bottom line. The decline in consumer spending coupled with an increase in competition, consumers demand for innovative and economical solution to everyday life – businesses have been forced to change how they conduct business. This is the common issue for both CrysTel Communications and Chrysler Corporation are facing.
CrysTel and Chrysler companies are finding that external forces are requiring them to be flexible and adapt to frequent change. Both must reexamine their organizational structure and implement new programs that will make them competitive to increase revenue and sales. Both have to be flexible and adapt to continuous change.
Similar to CrysTel, the last two years the Chrysler Corporation has seen a consistent decrease in sales. To respond, the automaker under went a total restructuring, from hiring a new CEO, developing more fuel-efficient vehicles, to selling off its unprofitable assets, and terminating dealership agreements with 25% of its dealerships. However, this would prove not to be enough, to increase sales. In 2007 total American sales were down 3.1%, but the situation would prove to grow worse, the following year sales were down 30% (New York Times, 2009) Chrysler executives realized that the company would need financial help stay in business. To aid Chrysler in continuing their operations, the federal government loaned the company almost seven billion dollars (Voice of America, 2009)
During the spring of last year, the Chrysler Corporation filed for Chapter 11 bankruptcy protection coincidently, the CEO announced he would leave as once the bankruptcy was over (Voice of America, 2009) Additionally, Chrysler would receive more funding from the US Government, more than one billion to be exact. For Chrysler, the following year would be even worse, in 2009 sales dip below one million – the worst sales figures in almost 50 years. During this transition, Chrysler hired a new CEO Sergio Marchionne – for 2010 he says his goal is to sale 1.1 million cars (USA Today, 2010).
Palos and South Deering Supply Corporation – Debra Newcombe
Palos
Palos is a medium-sized, well-established manufacturing company that has six plants nationwide and approximately 4700 employees. Palos (fictitiously named because of the three-year involvement with the program) has agreed to involve its management and employees in a Management by Objectives (MBO) program to determine if the company has sufficient job satisfaction levels. The MBO survey done on Palos is the same MBO implemented with Purex Corporation with favorable results including better communication and understanding of the company’s goals (Donnelly, Ivancevich, & Lyon, 1970).
The personnel manager handled every aspect of the MBO at Palos, but before initiating the program a questionnaire referred to as the Porter job satisfaction instrument was distributed to the managers. After finishing the questionnaire, the initial findings for the long-term goals were formally documented and given to all levels of management. Long-term goals are important in determining “what the company would like to become” (Kinicki & Kreitner, 2003, p. 92). After the company’s long-term goals were set, each department determined the short-term goals and submitted those plans to the personnel department. Short-term goals are important in an organization because they lay the foundation for the long-term goals. Then the managers set one-year goals and distributed copies to supervisors and subordinates for their review.
Goal-setting has always been important in organizations to determine if employees are motivated and have a sense of job satisfaction. However, unlike CrysTel, whose surveys were geared toward all personnel, Palos presented surveys to management only. This type of leadership style is defined as directive leadership, in which employees are not involved with decisions and company goals. CrysTel’s management is defined as a servant-leader type relationship with subordinates because of the company’s involvement with the company’s long-term, short-term goals, and job satisfaction surveys. The differences in leadership styles between CrysTel and Palo’s is that CrysTel empowers all employees to make decisions about goals and needs, Palos does not.
At the time of the survey, the challenges with Palos are the negative feedback for the implementation of additional paperwork the new goals set forth. The future challenges for Palos management is to teach them to become leaders versus managers, empower employees, and develop teams to reach short and long-term goals.
South Deering Supply Corporation
Like Palos, South Deering (whose real company name was also withheld) is a medium-sized, well-established organization with about 4,000 employees. Unlike Palos, South Deering has only one plant in a small Midwestern town. South Deering agreed to perform the MBO on its employees and also chose to use management as a catalyst for this study. South Deering chose top managers to teach the philosophies of the study to the other employees (Donnelly, Ivancevich, & Lyon, 1970).
South Deering’s approach to the MBO mirrored that of Palos with the long and short-range goals implemented by the managers. The exceptions to the similarity were that the goals at South Deering were submitted to a committee for review and the evaluation of goal attainment was done every three months instead of annually. As with Palos, the management at South Deering were directive as well, but the outcome of the results were different with South Deering as it boasted more positive results in employee needs satisfaction.
The study infers the difference between the outcomes at Palos and South Deering is the involvement at South Deering with the top managers in goal-setting rather than the personnel manager used at Palos. Personnel managers are far less apt to express the results of goals in a quantifiable measurement than top managers. Another positive outcome in the study referred to the shorter frequency of review on the goals as a contributing factor to the MBO’s success.
Palos and South Deering Supply Corporation Synopsis’s
Like CrysTel, Palos and South Deering’s employees had low levels of job satisfaction, which prompted the need for the MBO’s implementation. CrysTel’s employees were more involved in the survey process than Palos and South Deering, which enabled CrysTel to empower its employees and teams to set specific goals and create motivation. Palos and South Deering could learn by benchmarking CrysTel’s methods to increase employee satisfaction and motivate employees through goal-setting and education.
The feedback process showed significant improvements for both Palos and South Deering after the MBO was implemented. Although issues still existed, both companies had a solid base for which to put motivational theories to work. Using the Expectancy Theory of Motivation, both Palos and South Deering management would benefit from involving themselves in communicating standards to the employees, provide valid performance ratings, and set rewards accordingly. By implementing these steps, management could promote a positive work environment and insure future motivational goal setting participation.
The leadership styles for Palos and South Deering should better suit the new MBO objectives. Because of Palos and South Deering’s former objectives, the directive style worked well for the employees; however, the new objectives promote the need for a more charismatic leadership style, which managers can use to motivate employees to be more involved in goal-oriented activities. In addition to the charismatic leadership style, Palos and South Deering could also benefit from the transactional leadership style for their management to promote a better relationship between the employees and management, something that either company has been able to achieve in the past. CrysTel was able to implement leadership changes within their organization from high structure – low consideration leadership to total employee empowerment within the teams.
Ford Motor Company and General Motors – Donna Ray
CrysTel has strong top executives, but its departmental leadership skills especially in the Marketing and Sales departments need to improve. With transformational leadership providing timely feedback and motivation in these departments, CrysTel will be able to adjust better its changing market conditions and provide smoother transitions during these times of change.
Ford Motor Company
In 2000 Ford Motor Company wanted to develop and improve their leadership skills and become more consumers friendly. Ford’s 2000 Corporate Citizen Report Chairman, William Clay Floyd, said the difference between a good and an excellent company is: A good company provides quality goods and services; an excellent one provides excellent goods and services and attempts to make the world a better place (Friedman, 2001). Ford began to look for ways to transform into a consumer focused company as a means of guaranteeing long-term financial success, and Ford understood this transformation would require leadership. Ford decided to develop the Leadership Development Center that offered a sequence of leadership programs that focus more on Ford’s core principles.
Ford’s leadership programs created training for the development of transformational leaders through action learning, like Quantum Idea Projects (QIP) that promote critical and creative thinking, e-tools like the Internet and e-mail, incorporate work and life, and create business contact financially and organizationally (Friedman). This approach is what Ford identifies as total leadership. Over the course of these trainings through the Learning Development Center, members who worked with Quantum Idea Projects have developed effectively 600 projects with major business contacts, and a Ford’s current Supplier and Business Leadership project has seen $300 in profit for each vehicle (Friedman, 2001). The main focus of Ford’s Leadership Development Center is to build leaders with a consumer mindset, to incorporate full leadership, and to strengthen business alliances and be open to new ideas.
Key Findings
CrysTel could gain ideas from Ford by considering a leadership development program. CrysTel has come across constant changes in the unstable telecommunications market, and it will need quality leadership in its Marketing and Sales departments to supervise and grow with these changes. Leaders change his or her company through their vision, communication, and ability to build commitment (McShane & Von Glinow, 2004).
Alternative Solutions
Although CrysTel presently has good upper management leaders; a leadership development program could be develop to help improve leadership styles and skills in its Marketing and Sales departments and direct the development of training programs centered on CrysTel’s core principles and a changing culture.
General Motors
The Service Parts Operations (SPO) of General Motors is in charge of ensuring GM dealers, distributors, and vendors have the correct part at the right time at the correct price (Davis, Lucas, & Marcotte, 1998). Although SPO employees gave an account of strong financial performances and output, the division’s general manager, Bill Lovejoy, learned that the SPO division was not meeting its customer’s needs. Lovejoy believed that the next level of productivity could be accomplish with the evaluation of leadership style and managerial skills, and so Lovejoy hired Design Dimensions International (DDI) to evaluate desired management competencies, perform the training, and offer individual coaching (Davis, Lucas, & Marcotte, 1998). The evaluation was executed over a two-day period on a direct group of managers, clerks, and supervisors.
After evaluations were performed each employee developed a training plan with his or her DDI coach who focused on management simulations and skills like developing accountability, communication, and customer relations. Training assessments and follow-ups are an ongoing process. The data result from the pilot group was compare to those of a controlled group and the results were remarkable. First, the pilot group saw major improvements with role clearness and personal influence, available resources, and the use of personal skills and acknowledgment. The performance ratings for the pilot employees outweighed those of the control group in areas: schedule achievement, excellence, production, health and safety, and absenteeism. The productivity improvement resulted in nearly $4.4 million savings to the operating budget (Davis, Lucas, & Marcotte, 1998).
Key Findings
CrysTel could benefit from the works of an outside group who could assess their current leadership proficiencies. Proficiencies cover a broad range of personal characteristics like knowledge, skills, abilities, and values (McShane & Von Glinow, 2004). Improved leadership will help CrysTel build a culture that can sustain continual change.
Alternative Solutions
If the budget allows, CrysTel could employ one or two consultants to evaluate leadership proficiencies and develop personalized training programs that center on communication, and adjust to change.
Department of Health and JC Penney – Tamira Summers
Department of Health
Technology, size and strategy increased in ways that decreased positive attitudes and caused resistance for the WIC program within the organization. Although new technology is important, the state continues to work in a DOS system. The strategy is serves clients more efficiently and quickly to reach more of the public that needs the service. Later as statistic reviews are discussed and shared with corporate and county departments, will help solidify the cost, use, and contract of the software. Looking at new technology advances will takes retraining for new comers not familiar with DOS programs or have not used DOS in years. As the state contracts with different vendors for functional software that assists various programs with doing daily job duties, the use of it is exciting. Workers can work faster and provide services more proficiently. On the other hand, as the new programs are used more often, the possibility of an overload can occur which may cause it to shut down more frequently. This would account for the popularity of the program, meaning it started small and became bigger and bigger. What happens is that it allows us to service the public more and the more we service our system appears not to handle the traffic well. This means that more ram, memory and all that good technology talk needs revamping.
The WIC provides women, infant and children with dietary counseling to ensure they are eating healthier during pregnancy, postpartum, and the children up to age five. As clients receive counseling, many are excited about the new foods they will receive for the children but also their self. The checks have increased with numerous amounts of food and variety of foods listed, but at the same time, foods they were able to purchase either have been changed or eliminated from the program. One of the most challenging educational explanations for milk is the decrease in percentage. Many believe they should be able to have what they had before and continue to challenge Nutritional Educators saying, “My child will not drink anything other than whole milk or two percent.” Other challenges also include wanting milk that the hospital gives and the program uses another company name whose formula is compatible. It requires a medical referral to receive other brands because there is a particular reason for needing that brand. Others include simple complaints such as “the bread is hard to find” or “I waited for this formula to come in and it never did; now my check has expired.” Simple solution, go to another store and find it. Most clients are excited and share the newly imposed foods and benefits to their friends or family.
JC Penney
As a major chain in retail, JC Penney desire is to make shopping a pleasure and price merchandise within the general consumer budget. As a previous employee, the company sold cosmetics. These brands were sister brands some big box retailers and sought to service ethnic groups of all sorts. In addition, some lines were very European and rare to see at that time in JC Penney. As the economy changed, the cosmetic and fragrance lines were discontinued. In an effort to introduce other strategic move, the space use for accessories took over. Other departments expanded their space and were able to increase in merchandise; other areas underwent a redesign such as jewelry. Resizing other departments indicated a strategy move to increase in revenue and meet more of the consumer demands. With the missing cosmetic market, JC Penney could not compete with other major department stores such as Dillard’s, Belk’s and Parisian at that time. “Also a re-introduction of cosmetics included the installation of Sephora inside JC Penney located in some key stores. Beginning in 2007 the store slogan changed from “It’s All Inside” to “Every Day Matters.” Many major cosmetic designers sought companies that had the look of what they wanted to sell as well as the type of clients they wanted to sell to. Looking forward, the strategic move to eliminate the department did not just vanish. After years of going without a cosmetic department, Sephora introduced itself once again as a partner with JC Penney. Desiring to compete and meet the customer request along with many other back office dealings, Sephora brought added life to the company. This strategic move was necessary for competition but also to reenter a competitive cosmetic market with the help of another prominent line that caters to a variety of cultures. Technological bases in this industry focuses on Internet telecommunication, material, and biotechnology.
JCPenny’s is a giant in apparel retail; the right material is necessary and must provide a form of comfort to customers. Take for instance, the new sketcher shoes designed to help support the back and strengthen muscles in the legs, hips, and butt area. The technical design of the shoe provides a heel to toe rocking motion that guides the proper walking notion. The same is cosmetics, which the chemical balance is necessary to support the natural body’s hormonal reactors. Most current is the anti-aging serums.
JC Penney realizes the market for vanity is serious and is a multibillion-dollar industry. In addition, this line of cosmetics is fun, trendy, and sophisticated meeting ages of sorts. In addition, JC Penney offers online purchasing and phone purchases. Without some of the technological advances in Internet and telecommunications, some clients would not shop at their favorite store. The company continues to grow in popularity and size. The need to build in convenient locations as well as go international is reason to adapt to change.
Compare and Contrast
Department of Health for Duval County technological advances are state approve. For new software and machines to come into the different sights for our division has identified the need for it. The new program implemented helps increase in speed and accuracy of serving the public, which the division caters to. Better technology in programming removes the use of a DOS system despite functions used to input information. As more and technology programs are designed to meet the functions of government programs, the use of old technology will completely disappear and eventually the state will meet more challenges with precision.
JC Penney technology avenues have increased with Internet shoppers and transforming them into buyers. “In 1998, J.C. Penney launched its third channel for shopping convenience. Its Internet store has grown into one of the largest apparel and home furnishings retail sites on the Internet. Among its general merchandise peers, the on-line store has the highest rate (10.1%) of converting site visitors into buyers.” Between Internet and telecommunications, JC Penney continues to compete not just in the physical store but virtually as well.
The both meet the needs of the consumer, but one lags behind in the combination of Windows and DOS programming. The move to reach the consumer is greater for JC Penney because of the technological advances and apparel industry. In order for Department of Health to reach the consumer is more challenging because the use of some technology such as the Internet is not readily available to clients, but word of mouth is an important tool relied upon to attract the clients we need.
Department of Health size is based on the size of the county and the number of residents that need the program. Jacksonville, Florida is the largest county here and the number of residents is over 800,000. Our goal is to service at least 95% of the county. Many also come from neighboring counties, but they are not without their county division. Because of the size of the county, more opportunity is here to reach those in need. Surrounding counties have only one office clients can travel to. Thanks to funding and clients, the county has more offices for WIC, but also for medical attention and dental attention.
JC Penney started business in 1902 and continues to thrive decades later. Almost going bankrupt, this retail leader has survived more challenges than many other departments who eventually closed its doors. In this current age, JC Penney moves forth in size and has retailer itself to meet fashion trends, refocus areas of greater need and continues to grow as a retail giant. Once introducing cosmetics and doing away with its cosmetic department, the company was able to expand in different areas meeting a different consumer demand for apparel and accessories. As the organization revisited the cosmetic industry, it reintroduced its self with a new hot and trendy cosmetic line named Sephora. This company contracted with JC Penney and increased the cliental and financial reward of this industry.
One company size can focus on demographical need; the other industry can focus on a need to clothe the demographical area. It also relies on another industry that attracts clients through media, marketing, and trend. The other attracts customers through a need and not a desire. One helps feed the population and the other feeds off the population. This may be an unfair analysis, but respectively true to its industry.
The Department of Health strategy is based on grants through the United States Government. Identifying and analyzing the needs of the public, there is a strategic analysis that shows the state why requests are in need. Statistics such as infant mortality, obesity, doctor visits and so on indicate why new programs or increase funding for existing programs are in need. Forecasting for the future to reach a percentage of customers will set forth other strategies that will continue to offer help to those in need.
JC Penney strategy is trend focus. To remain competitive and meet consumer desires, the company relies of buyers and designers to set forth the next wave of colors, materials, cuts, chemical serums and technology use to help set the stage for upcoming changes. Virtual communication has led the company to implement a new shopping habit through Internet use. Technology is the future and seeking ingenious technological outlets to meet and exceed consumer desires are all part of the ability to forecast strategic moves.
Conclusion
The ability to change and adapt are important in today’s organizations. Change models assist businesses in developing goal-setting skills and understanding employees. Organizations that can identify specific leadership skills among their managers can implement changes such as education and training to improve their performance as well as the performance of the employees with whom they supervise. Empowering employees with the ability to make decisions, be creative, and provide input can be a valuable asset to any organization. Our team was asked to research and assess multiple companies that have endured change and continue to be successful because of their flexibility.
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