Critical Analysis of the Theory on Managing and Leading Change with Regard to the Case
Living in the period of significant organizational change implies understanding and adopting new management styles that are flexible, open, and decentralized. However, the main obstacle to change is inability and reluctance of employees to embrace the benefits of the shifts that occur to organizations at all levels of management.
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Anchor’s alternative approaches to shaping culture contribute empowering organization’s competitiveness and promote new strategies for organization’s success (Burke 2010). The case of AEGON proves the managing and leading change should be reviewed from the perspective of organizational development. In particular, the managerial staff should focus on three dimensions.
The first activity of leading change involves adequate distribution of responsibilities and duties, including freedom to improvise and communicate. Second, a wide range of low-cost probes should be encouraged to explore future opportunities and adjust to changes (Cummings and Worley 2009). Finally, the managers should be able to drawn the link between current projects and future challenges.
Cummings and Worley (2009) suggest that that effective change management should be premised on five aspects that include motivating change, developing political support, creating a vision, managing the transition, and sustaining momentum.
Each activity should be taken into the deepest consideration because they promote new skills, experiences, and competencies among the employees, as well as reinforces new behavioral patterns required to introduce changes (Scott and Jaffe 1995).
In addition, due to the fact that AEGON focuses on development of a new culture and reinforcement of financial resources, introducing a five-dimensions mode is efficient for enhancing employees’ skills and readiness to adjust to a constantly changing environment.
Managing change implies transition from local management to global-scale activities, which allow managers to introduce a new way of thinking in an organization (Burke 2010). In this respect, the company’s change approach is closely associated with Lewin’s change theory, which is based on three stages of successful transformation: unfreezing, movement, and refreezing (Simms n. d.).
Hence, the process of unfreezing implies “…destablishing the present balance of forces that give the organization or business its stability” (Simms, n. d., 124). This initial step is the most challengeable one because it requires the managers to highlight and eliminate the existing dissatisfaction through introducing additional tools for change, including schedules, new personnel, or budget constraints.
The second phase implies shifts from the unbalanced system to the introduction of new paradigms at all levels of administration. The process involves creating new behavioral patterns and developing a new rewarding system. At this stage, a different management style is also indispensible. In this respect, AEGON focuses on combining local expertise and global practices.
Organizational Changes at AEGON and Its Usefulness for Company’s Success
As it has been mentioned briefly, AEGON has decided to introduce new patterns of development and change that can enhance the organization’s competitiveness and produce new mechanisms responding to the challenges of the external environment. In particular, the company paid attention to the reposition of Scottish Equitable brand to gain trust of consumers and enhance the company’s reputation at the international level.
Second, the appointment of the audit committee encouraged the company to define internal and external challenges for the organization. In such a manner, AEGON managed to ensure an informed and transparent approach to the decisions that should be made to set up the change process (Paton and McCalman 2008).
The committee also underlined that the organization had solid positions at the market due to staff’s considerable expertise, high-level communication, and innovation. The external activities helped the company to define its competitive capabilities. The analysis of internal and external perspectives has promoted the manager’s understanding of existing gaps and pitfalls should be considered.
Finally, the organization appointed a new chief executive officer whose primary responsibility was to carry out a discovery stage. The main objective of this phase was to introduce a long-term savings and security plan in the United Kingdom. While implementing this change, the organization focused on the current and future potential of the business development to define what should be done to overcome challenges.
All the above-introduced reforms have contributed greatly to the organizational development and competitiveness, as well as to the definition of new prospects in future business activities at a global level. An overwhelming, multi-level approach, therefore, is a consistent plan that can motivate employees and instruct them to accept changes.
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Triggers and Rationale for Change in AEGON
There is a variety of underpinnings for organizational change, among which the external factors constitute a priority. Specific attention should be given to globalization of markets and businesses, which makes organizations accommodate competitive constraints in the domestic market as well (Dawson 2003).
Advances in technology and organizational expansion are also among the major incentives for change within an organization because they require reevaluation of organization’s complexity and development of relevant coordinative mechanisms (Dawson 2003).
Apart from external triggers, the organization should also encounter internal constraints to leading change successfully (Senior and Swalies 2010). This is of particular concern to such aspects as task prioritization, technology implementation, efficient human resource management through multi-task activities, and restructure of administrative hierarchy.
All these issues have been considered by AEGON’s manager to promote efficient change management among the employees. The emphasis has been placed on the analysis of global trends in the market competition, as well as the evaluation of the existing potential of the organization in the United Kingdom and outside it.
In addition, the company should also take environmental issues into consideration while developing budgeting schedules and allocating financial resources. Leadership change is another important perspective that should be presented within the context of organizational development (Mills et al., 2009).
In this respect, the analysis of AEGON’s strategies has revealed that the importance and usefulness of change management were extremely high because this perspective has become the premise for further successful advancement of organizational values, mission, and goals.
In this respect, Mills et al. (2009, p. 4) have noted, “…organizational change can be defined as an alteration of a core aspect of an organization”. Such aspects involve personnel, leadership, culture, technology, and goal of an organization. Within these perspectives, the company has managed to consider the majority of them, except for technology innovation.
Actions of Top Management With Respect to Implemented Change Strategies and Their Impact on the Organization
The managerial staff of an organization should be able to face difficulties and introduce changes in a timely manner. Their task is to accurately predict possible problems related to the old-fashioned mechanism of responding to external competition, as well as meeting consumer demands.
Therefore, close assessment of employees’ psychological profiles, their social and cultural backgrounds, provides fresh insight into how an organizational climate could be improved (Arrendondon 1996).
As soon as the managers provide a full evaluation of employees’ needs, they will be able to enhance the quality of services and well delivered to consumers. Development of beneficial social schemes should also be implemented to deliver a good base for further promotion of values and behaviors.
Due to the fact that the organization attempt to promote their business activities to a global level, the focus should be on defining the main cultural diversity issues. In this respect, Handlechner (2008, p. 4), “diversity should be seen as merely a replacement for the old equal opportunity policy: it must be a corporate value, an integral part of business strategy”.
At this point, workplace equality, irrespective of gender, nation, and race, should be ensured. Apart from equal opportunities, diversity management could be seen in a broader sense for senior managers to assess each individual’s needs, beliefs, and attitudes. As soon as the organization realizes its human resource potential, it will be able to provide reactive and proactive measures to the change process.
The success of change implementation depends largely on the readiness of employees to change their attitudes toward organization’s strategies. Because attitudes create a strong emotional basis of interpersonal relations, they are indispensible to determining and predicting future behavior that is connected with motivation, perception, and personality (Sims 2002).
In this respect, AEGON’s committee of senior managers has developed as set of ethical and moral standards in compliance with organization’s mission and statement to foster global integration an reduce the pressure of competition.
According to Mullins (2007, p. 124), “sensitivity to individual needs and differences, especially in term of their resilience becomes significant when organizations embark on change initiatives”. The top management of AEGON has succeeded in developing appropriate modes for employees to make them realize the importance of changes.
Importance of Change Management
Companies that resist changes contradict the adequate cycle of organizational development. Indeed, organizational change results in constant improvement and positive transformation, ensuring a competitive advantage over other companies. In this respect, Yaeger and Sorensen (2009) approve the concept of positive change in the context of appreciative inquiry that is successful while dealing global and international issues.
In particular, the positive change addresses “…such issues as convergence versus divergence in national cultures, or whether the world is becoming more or less diverse” (Yaeger and Sorensen 2009, p. 5). In addition, human values that pertain to employees’ experience and are practiced across many cultures.
Exchange of experience is an important condition for promoting organizational success because it contributes to the development of rich organizational culture and endowing employees with new incentives. Competition within an organization is vital for enhancing employees’ capacity to compete with external business rivals.
Therefore, change is a multi-dimensional process covering all areas and levels of management and ensuring constant growth and advancement. Its major focus should be made on enhancing organizational culture, developing a new technological base, and analyzing the external environment.
Financial issues should also be taken into consideration because they serve as foundational tools for shaping new objectives and distributing new responsibilities. Prioritization of tasks and duties among employees is another important strategy that is implemented within the context of change management.
Finally, leadership skills should also be premised on advancement of experiences and abilities that are necessary for introducing transformation. Shifts in leadership styles and a person-centered approach are important for developing successful organization.
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