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Tkc Change Management

Essay by   •  April 27, 2012  •  Case Study  •  2,785 Words (12 Pages)  •  1,642 Views

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Successful change management is critical in the business world of today. If an organization doesn't manage change effectively, they put everything at risk. This includes their reputation, workers, products, and ultimately - their business lives. With the economy in a flux, a multitude of changes occur every single day and the responsibility of dealing with this lies in organizational leadership and HR professionals. For that reason, HR personnel must be acclimated with the different functions and tools of change management. Today I'll investigate two organizations that encountered difficulties and went through major change management processes. They are The Kitchenware Company (TKC) and Biogen Idee. I'll compare and contrast their situations, as well as their approaches and the successes they achieved. Additionally, I'll discuss what HRM's role was in the change-making approaches. I'll also add my own observations throughout. I'll begin by examining their situations, starting with TKC.

TKC Situation

TKC was in dire straits. It had poor product lines, a bad customer fulfillment reputation, high central overheads and demotivated staff. These drivers, coupled with the enthusiasm of new owners, led to radical changes within the company. Focusing primarily on customers, the company recognized it needed to refresh its product lines, change its fulfillment practices, and focus on customers and their needs. The change approach was one of top down, but emergent as different opportunities presented themselves over the course of a number of years (Green, 2007). So, while TKC was in a downward spiral, the Biogen Idee was in a totally different situation.

Biogen Idee Situation

Biogen Idee was already experiencing success as an organization. A key aspect was its ongoing commitment to constantly reviewing and refreshing its global development, manufacturing and commercial capabilities in pursuit of its vision of making advances in human healthcare. It investigated the issue of whether or not its European structure and way of doing business was right. It was also very clear in adhering to its core values in making those challenges and subsequent decisions, with quality, integrity, honesty and team as a source of strength being paramount. So, the combination of having a clear vision about excellence in its field coupled with an emerging dissatisfaction with the status quo led it to start a review process into its European structure, which was the first practical step on the road to change. The approach that Biogen Idee took was a relatively planned one, given that the nature of the change was one of restructuring, which had a number of employment law implications. The process was well planned and structured, but the solutions (Green, 2007). Despite the fact they were experiencing success, they wanted to test the waters to develop their situation even further, improving the services they provided and becoming a leader in their field. Their situational contrast from TKC was drastic

Situational Contrast

TKC was at risk of losing their business entirely, while Biogen Idee was experiencing success. This definitely altered the outlook as far as change management was concerned. One was strictly looking for improvement in already successful processes, while the other was looking to "stem the bleeding". While Biogen Idee could easily revert back to the status quo and remain a viable organization, for TKC - the change would pretty much turn around the business or lead it into financial ruin. Now, what about each organization's approaches?

TKC Approach

TKC decided it needed to concentrate on the front end of the business. Marketing became the main focus. It had exceptional distribution, but had appalling packaging. By radically re-branding this they could set their business apart from similar suppliers and make a huge impact on the store shelves. They also developed a second award-winning product line. They also extended the spread of distribution by saying 'yes' to anything - whether the customer wanted the company brand, their own brand, or a modification. They aimed to consolidate the customer base by understanding customer requirements. They shifted emphasis from predominantly wholesale distribution to include retail, and invested heavily in wooing buyers from the range of supermarkets and stores just under the main supermarket chains. With the many smaller players there was immediacy in the contact and both parties could agree to tailor their needs and responsibilities according to what the relationship demanded. Whilst developing a number of strategies to make this happen they also had to address some other key issues within the organization, to include a suspicious sales force, wary of a "quick fix". Also, headquarters staff was entrenched in their own culture and uncaring of a downtrodden warehouse staff, which, having been largely ignored for a number of years had become a relatively undisciplined and disrespectful group (Green, 2007). Biogen Idee's approach was different.

Biogen Idee Approach

A project team was appointed to conduct the reassessment of the business strategy. The key objective was to conduct a benchmarking study for the best location to optimize organizational structure and processes. It was hoped to be able to develop more effective relationships with both European affiliate companies and the corporate headquarters in the United States. The head of the international business was appointed to be the project leader, supported by the directors of commercial operations, human resources and international legal affairs. The first stage was pure data gathering of internal and external information. The company was intent on following best industry practice. The second stage was to look at future options regarding distribution of functions and allocation of resources across Europe. In principle it was decided to create three 'centers of excellence', by moving commercial and administrative functions to Switzerland, regulatory affairs and drug safety to the UK, and logistics to Holland (Green, 2007). Their prioritized study made it possible to retain their world-class reputation, even if they changed operating locations and personnel. Now - how were the two organizations' approaches different?

Approach Contrast

TKC was in full change mode. They started at the top and worked their way down by speaking to everyone from headquarters staff down to warehouse dock workers. They worked on not only improving their product line, but delved down into communication lanes between different work center entities.

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