Today’s organizations are facing many challenges such as threats of inflation, deflation, and recession resulting worsening the economy of the United States. According to Borkowski (2005) and Spector (2010), they state that the economy worldwide is very difficult nowadays because many internal and external forces. One of the best seller bookshop, the Concord Bookshop, lost control over the market because of huge losses. To stay open to business the company needed a change. The company hired a new president to help the company to maintain finances and funcionality, but employees had tremendous resistance to the change.
The company made a drastic plan to change employees behaviors to improve bussines, but owners of the bookshop did not use effective implementation for the change process. On the other hand, workers at Concord increased resistance to the change process because owners did have neither communication nor inclusion of changes; instead, they increase their fear and uncertainty of the employees. Adding more, the owners failed to use effective redesign, mutual engagement, and shared diagnosis (Spector, 2010).
This paper will define the phases in the organizational change process, including phases not completed or implemented at the Concord Bookshop leading the organization to fail.
Assessment of Forces
The Concord Bookshop had been on the market for 64 years, it was one of the best independent stores in New England, but they went off business because their profits were tightened. Other bookstores such Amazon Barnes and Nobel increased their finances because they made changes according to the needs of new technologies and customers expectations.
The progressions of these bookstores were implemented by redesigning their business; so their earnings went higher. The Concord Bookshop had a particular characteristic to attract customers, according to Joanne Arnaud, director of the Boston Literacy Fund and a Concord resident, she signed the letter: “What make the Concord Bookshop different are the people and their institutional memory and their memory for a customer, they are so warm and welcoming” (Spector, 2010, p. 2).
The organization needed a good strategic plan to maintain business open. The company needed a change, but they made a drastic plan that employees had strong resistance to the change. Owners failed to communicate the employees the shared diagnosis, the severity of the problem, and they did not use effective implementation for the change process. This happening made workers feel devaluated; they stated that something on their lives were lost. Adding more, the owners failed to use effective redesign and change process, mutual engagement, and shared diagnosis (Spector, 2010).
According to Spector (2010), the president of Concord Morgan Smith’s attempted to bring financial discipline to the Concord Bookshop facing sensitive realities. Owners, employees, customers, and suppliers approved the desire of maintaining the store’s viability. In addition, Smith’s approach and the actions taken by leaders created resistance of the employees because they did not do the correct strategy to solve the company losses, also they did not implemented the plan; therefore, these errors led to resistance, conflict, and resentment. Identifying the need for change is vital; first, it is required to do an assessment on the organization, employees, finances, and structure. Implementation is crucial; however, it is necessary to do a deep recognition for effectiveness of strategic response.
The main forces that make organizations to change are external, industry environments, and new operating requirements generated from these environments; for example, new technology available, new trends of selling on the Internet, and more. Today’s organizations are facing many challenges; for example, trade, and industry insecurity, wars, and terrorism weaken the economy globally. External forces affect in general weakening the economy of the United States. One of the major external forces affecting businesses is the increased use of technology and the availability of the Internet (Borkowski, 2005) (Spector, 2010). According to Spector (2010), strategic renewal requires organizational change, Concord Bookshop needed to move from a traditional and conservative store for British shoppers to Internet buyers.
The strategy for renewal of business, leaders need to align internal processes, structures, and systems in accordance with demands of the market system. For example, “New organizational capabilities, talents and skills possessed by employees need to be built” (Spector, 2010, p. 5). Managers need to discontinue old behaviors on employees by selecting new approach, in which employees feel comfortable and secure to accept the change. Consequently, workers needed new orientation on-the-job, new tasks, and responsibilities to assure the viability of the company as well as employment. The goal of any organization is to create lasting modification in patterns of employee’s behaviors to support strategic renewal.
Concord Bookshop Strategic Renewal was not implemented
* Strategic renewal requires organizational change; in the case of Concord business was not implemented. Strategic renewal demands, “Wide-scale invention, reinvention, and redesign of business processes and organizational structures require organizational change. The leaders in charge of the organization did not do renewal demands. According to Spector (2010), Concord closed after 64 years on business making many people unemployed, they felt depressed and devaluated for the store situation.
Mistakes found in the organization were the following: employers did not complete mutual engagement and shared diagnosis, they did not restructure leadership adequately, and they failed to diagnose the pattern of behavior within a top leadership team (Spector, 2010).The conflict put pressure on the store when independent booksellers are staggering from competition and the Internet. * Phases of the Organizational Change Process not Completed or Implemented at the Concord Bookshop that Led the Change Failure Turnaround
Turnaround is a technique that focuses on processes for improvement. Turnaround addresses finances of the balance sheet enhancement and technology. Concord did not complete turnaround well; instead, there was not salaries deducted, and employees did not lose their job immediately. Adding to this, there was misunderstandings and fears to employees; these reasons put the company on fire. Smith on the other hand, did not focus on new behaviors, turnaround looks at the company’s assets seeking manage finances to stabilize the cash flow; Smith did not manage well finances of the company. According to Mark (2007), employees did not receive efforts to change with pleasure. In the process of implementation, some resistance from employees comes from different internal sources; also resistance comes from external sources. Workers at Concord had increased resistance to the change process.
Techniques and Tools
Techniques and tools is a non-behavioral phase of change process. Concord failed to change this technique by not using organizational processes, mechanics, and other interactions intended to produce a product or service. For example, in 2007, Netflix started a new technique for improving customer service by substituting hundreds of telephone call centers for e-mail based response system. They save money, and created new employment; call center representatives were added to payroll. For instance, Concord could have done this technique and turn to different customer service system. This system could fit well for Concord Bookshop to attract new customers to stay alive on business (Spector, 2010).
Outsourcing is a change technique, this tools implements the turnaround and transformational behavior change (e.g., cost-saving) implications (Spector, 2010). Organizations find outsourcing a very important strategy because: 1. Outsourcing saves money by transferring jobs to lower-paid workers. 2. Outsourcing enables companies to concentrate on core competencies. 3. Outsourcing offers a hedge against shifting technologies and customer preferences by lowering fixed costs and building flexibility (Spector, 2010, p. 16)
Smith’s approach crated a conflict, resistance, and resentment. The organization needed to change to respond to the external demands. Concord leaders did not communicate the change well as they should so employees would understand and change behaviors. The organization needed to change the demands of the customers adapting the business to sell according to the new technology; for example, the new mode of communication was the Internet. Therefore, by the time they wanted to fix it was already late. Smith did not do outsourcing well because he did not realign the behaviors of the employees with company strategy and customer expectation.
Trigger Events and Change
According to Spector (2010), Organizational change is typically initiated in response to a trigger event. Spector (2010), states that Trigger event is a shift in the environment that precipitates a need for altered strategies and new patterns of employee behavior. For the Concord Bookshop, the increasing penetration of online booksellers into the store’s market space triggered the requirement for strategic renewal (Spector, 2010, p. 18). Trigger events are external or internal to an organization. Trigger events help to precipitate the need to alter behavioral patterns of employees. Concord Bookshop faced external trigger events. Trigger events may come from inside the organization; for example, when the organization hires a new leader. According to Spector (2010), she says “Jack Welch was promoted to CEO of General Electric (GE) in 1981, the company was enjoying decades of prosperity and success” (Spector, 2010, p. 18).
This is an example of internal source of trigger event; Spector (2010), said “Virtually from the outset, in a quest for transformational change” (Spector, 2010, p. 18). Trigger events are so crucial for their magnitude and potential personal impact. They set into motion a series of mental alterations as individuals struggle to understand a situation. According to Spector (2010), “trigger events have a nature to umbalance established routines and evoke conscious thought on the part of organizational members. It makes people’s emotions to react to a change. In short, according to Spector (2010), states “Trigger events bring people’s mindsets into the arena of change” (Spector, 2010, p. 18)
The Concord Bookshop downsizing was terrible, the owners of the bookshop made changes to their organization without using an effective change process and implementation. The result of their approach was the resistance of the change from people in the organization. The organization made a numerous mistakes on not communicating to employees the severity of the problem. The owners of the bookshop recognized that the trigger event for the need for change was to recover financial profit. However, they did not involve the rest of the staff when this problem aroused. If they did a complete shared diagnosis stage, the issue would be solved properly. Last, the owners failed to move and redesign stage of the effective change process. The owners needed to redesign the roles and responsibilities, and involve the employees on planning solutions, so changes will be accepted more easily (Borkowski, 2005) (Spector, 2010).
Borkowski, N. (2005). Organizational Behavior in Health Care, 1e. Miami, Florida: Jones and Bartlett Publishers. Mark H. (2007). The tools and techniques of change management, Journal of change management Vol 7 p37-49 http://www.scribd.com/doc/78216618/Spector-2e-Instructors-Manual Spector, B. (2010). Implementing Organizational Change. Theory into Practice, Second Edition. USA: Pearson Education. Rosen, J. (2011). Bookstores and Bloggers. Publishers Weekly, 228(20), 20. Taken from EBSCO September 252012.