The global business environment is constantly developing and making organisations adapt to these processes while managing change. In this context, the organisational change is a process of changing the company’s direction in the work, strategies, and behaviours in order to address new goals corresponding with the progress of the business environment (Cameron & Green 2015).
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Still, according to Goksoy, Ozsoy, and Vayvay (2012), the rate of failures associated with the change management is rather high, especially in multinational organisations, where it is necessary to address diversity and cultural issues. From this point, to conduct the organisational change effectively, a manager needs to have highly developed leadership skills and motivate employees with different backgrounds to avoid their resistance to changes (Nordin et al. 2012).
Thus, the problem of implementing a successful change programme in a multinational corporation needs to be resolved with the emphasis on appropriate theories and models that are useful to provide the conceptual background for the efficient implementation process. The purpose of this paper is to critically evaluate change management, leadership, and motivation theories and to propose the best solution to the problem of managing a change in a multinational company and to provide necessary recommendations in order to implement the programme efficiently.
Change Management Models and Theories
In order to manage a change in a multinational organisation and to implement an effective change programme, leaders traditionally refer to change management models and theories that explain factors, steps, and tools important to implement a change and achieve the goal. The traditional change management models that are actively used today in the business environment were developed and proposed by Kurt Lewin in 1947 and by John Kotter in 1996 (Hayes 2014; Hurn 2012).
Lewin’s Change Management Model
In 1947, Lewin proposed a change model that is based on three main stages known as the unfreezing stage, the change stage, and the refreezing stage. During the first unfreeze stage, a leader determines the current state of the organisation and focuses on preparing employees for accepting the further change (Bucciarelli 2015, p. 37).
Thus, a leader needs to determine driving forces of the change and identify possible resisting elements in order to avoid them during the further implementation of a change. From this point, a leader should communicate the necessity of the change and motivate employees to accept it while being ready to address possible misunderstanding and resistance to any change in the organisation (Fullan 2007; Hurn 2012, p. 44).
The second stage is the actual implementation of a change that involves transformations in employees’ attitudes and positive shifts in their new activities and practices. From this point, the actions and attitudes of employees alter according to the new direction chosen by a leader according to the change programme.
The third stage of Lewin’s model determines the period when the changed approach becomes a typical strategy for an organisation, and it is possible to notice stability in a company (Shin, Taylor & Seo 2012). The success of the change implementation at the refreezing stage is revealed in developing organisational policies and setting new criteria and standards associated with the change as norms that are adequately perceived and followed by employees.
Kotter’s Change Management Model
Kotter’s model was developed as a result of analysing the leadership and change management experience of directors and managers in different companies. Having estimated the results of implementing the necessary change in organisations, Kotter formulated eight steps that are essential for an efficient shift in the company to achieve new strategic goals. The first step is based on promoting the urgency of implementing a change.
Employees need to see that their organisation should be modified to compete in new environments (Burke 2013). The second step is the formation of the working group of people who can guide the change management. These people form a team responsible for the main decisions regarding the project. The third step is the focus on the change vision (Hurn 2012, p. 42).
It is necessary to create the vision according to which it is necessary to formulate strategies for the further implementation of a change (Awad, Sherratt & Jefferies 2013, p. 18). The fourth step is the communication of the vision and a change necessity that needs to be realised in many forms because employees should be convinced and motivated to accept the change and new rules.
The fifth step is associated with empowering employees to risk in their work according to new standards. This action is oriented to reducing the resistance of the staff and making them avoid old systems. The sixth step is the orientation to short-term successes in the change management. These successes in employees’ behaviours need to be encouraged and rewarded (Benn, Dunphy & Griffiths 2014).
The seventh step is based on promoting the further change while encouraging more actions and adding new details to the change project (Cummings & Worley 2014; Hurn 2012). Finally, the eighth step is based on the integration of new behaviours and changes into the culture of an organisation to connect the success of a company with the implemented change.
Leadership and Motivation Theories
The success of implementing a change in an organisation also depends on leadership and motivation theories, as well as on the vision of diversity in multinational firms. Therefore, it is also important to describe leadership theories in order to determine effective and ineffective leaders’ behaviours and to determine motivation theories associated with employees’ driving forces.
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The success of the change management in an organisation depends on the leadership skills of its promoters. In this context, the concept of transformational leadership is directly associated with the idea of the organisational change because leaders are transformational when they are focused on the process of positive changes and improvements in the organisation and when they motivate and inspire employees to develop and professionally grow while accepting new trends in behaviours and other activities (Robbins et al. 2013).
By, Burnes, and Oswick (2012) state that transformational leadership is a result of changing the approach to traditional leadership models according to the focus on the constantly changing business world to adapt to alternations and new trends. As a result, the competitive advantage of the organisation that is promoted according to the principles of transformational leadership also increases.
McGregor’s Motivational Theory
Theory X and Theory Y were formulated by Douglas McGregor in 1960 (Hayes 2014). According to Theory X, employees are usually non-motivated for working, they have no ambition, and they try to avoid responsibility and any tasks. As a result, the close supervision is necessary to coordinate their work.
According to Theory Y, employees are mainly motivated to perform better and to achieve higher results while focusing on challenging tasks (Russ 2011, p. 824). Thus, managers can motivate them while proposing new difficult assignments.
Critical Evaluation of Models and Theories
Evaluation of Lewin’s Change Management Model
Lewin’s model is actively used in the management of changes because of its easiness and the focus on balancing the efforts made by all employees in order to implement the change. Furthermore, the users of this model operate the concepts of driving forces and resistance that are directly associated with the motivation of employees (Battilana & Casciaro 2012, p. 382).
According to Cameron and Green (2015), Lewin’s model works well for large organisational changes and changes in departments and determined operations. For instance, the change implementation process planned for the whole organisation can be divided into three large stages of unfreezing, moving, and refreezing for the ease of a manager.
In this case, a leader organises people to understand the necessity of the change according to the current state in a natural manner, while preparing them for future changes (Hurn 2012; Shin et al. 2012). Then, necessary actions are taken to change the behaviours of employees and their attitudes to the change.
Finally, employees achieve their goals set by the leader, and the changed behaviour becomes integrated into the culture, and the work of the organisation becomes not only improved but also stable. This process seems to be rather simple to understand by employees (Schaffer, Sandau & Diedrick 2013, p. 1198).
If a multinational corporation needs to improve the work of only one department, the leader organises the work of the team to define the situation and identify the problem, to plan the change, and to achieve positive results with the further reinforcement of a new practice and encouragement of employees to support it. In this case, taken steps are rather simple to make.
The strength of the model for implementing a change in a multinational company is an opportunity to discuss driving forces to promote a change and resisting forces associated with the employees’ behaviours at the early stage of the change promotion process. As a result, the further work of the leader implementing a change programme is oriented to supporting driving forces, influencing the staff’s motivation, and overcoming resisting forces in their behaviours.
According to Smith and Lewis (2011), this approach is important for a multinational company because driving sources depend on cultures and effectiveness of cross-cultural communication, and the sources of resistance can depend on language and cultural barriers. Still, the weaknesses of the model are in the lack of details to provide a leader with concrete lists of actions that should be taken at each stage of the change programme implementation process.
Therefore, this model is more often used as a planning tool that is helpful to identify the basic stages necessary for the effective change implementation and management in a concrete company (Fugate, Prussia & Kinicki 2012, p. 891; Hurn 2012, p. 41). In a large corporation that has the diverse staff, this approach can be used as a framework, and a leader needs to focus more on providing details for each step making to achieve the set goal.
Evaluation of Kotter’s Change Management Model
Kotter’s model is a good choice for managers and leaders planning a change in their organisation because all steps required to achieve a good result are described in detail, and a leader can use this model directly to apply it to the concrete organisation and situation. Appelbaum et al. (2012) note that the model is useful because a leader concentrates on the idea of urgency while communicating the necessity of the change, and a leader works hard to convince each employee to accept the necessity of changes.
In their turn, Cameron and Green (2015) note that the practice of creating a coalition can serve as a role model for other workers, and it is especially important for multinational firms, where diverse employees need behavioural patterns to follow in order to understand and accept general principles of the organisational culture adopted in the concrete organisation. In this case, the model is effective because it provides opportunities to create the standardised rules for multiple and diverse employees.
In addition, Kotter’s model is based on the idea of motivating employees at all stages of the change process, including steps 5, 6, and 7, when the staff becomes rewarded for adopting new rules and promoting the change daily. The example of a real application of this practice is firms like IBM where leaders work hard to demonstrate how changes can positively influence the working and living experience of employees and how the adoption of changes leads to more benefits and rewards (Hurn 2012, p. 42).
During the change implementation process, employees try to resist changes at each stage because of stress (Burke 2013, p. 22). According to Hurn, “the stress caused by actual or perceived change is an important issue and its reduction is a key concern of management” (Hurn 2012, p. 43). Actions made by leaders in steps 5, 6, and 7 of Kotter’s model are useful to overcome stress and other resisting behaviours.
Obvious weaknesses of the model, as it is stated by Appelbaum et al. (2012), are the necessity for the coalition members to remain highly motivated at all stages of the change implementation process. The problem is in the fact that much emphasis is put on the first five steps of the model, when the following steps are planned to result from the high motivation of empowered and encouraged employees (Appelbaum et al. 2012, p. 765).
In reality, diverse employees in multinational companies need to be supported and motivated actively at all stages because of their different needs and interests in promoting the change process.
Appropriateness of Transformational Leadership Model
Transformational leadership based on the principles of democratic leadership is more effective than coercive leadership and other destructive leadership styles (Aasland et al. 2010; Ann & Carr 2010). The reason is that transformational leaders pay attention to the needs of employees, and they perceive the change as a process that can be managed in steps and with the focus on employees’ interests (Ernst & Young Company 2009; Hayes 2014, p. 121).
This approach is especially appropriate for multinational corporations where inspirational motivation as a component of transformational leadership tactics should be used with references to each working individual. McGregor’s theory of motivation is also correlated with both Lewin’s model and Kotter’s model of an organisational change because the focus on motivated employees as driving forces of the change process is typical for these models (Goksoy et al. 2012; Theories and models of organizational change n.d.).
McGregor’s Theory Y is more helpful to promote the change than Theory X because rewards and encouragements for non-motivated employees according to Theory X are useless, and they cannot lead to the successful implementation of a change.
Best Model to Support Implementation of a Change Programme in a Multinational Company
Having focused on the evaluation of such traditional change management models as Lewin’s model and Kotter’s model, as well as on the analysis of associated leadership and motivation theories, it is possible to conclude about the best theoretical framework for implementing a change programme in a multinational company.
The evaluation indicates that the most appropriate model to promote the change in a firm is Kotter’s model that can be supported by the principles and concepts of the transformational leadership. The reason is that Kotter’s model provides managers with an opportunity not only to identify a necessity of a change and develop a plan but also to accept this change and convince employees to adopt it during carefully organised steps (Goksoy et al. 2012; Theories of change 2011).
In this context, Kotter’s model is based on three stages of Lewin’s model, but it is more detailed and appropriate for large organisations. The organisational change is a complex process that requires significant efforts made by leaders to organise their work in such a specific way to influence employees’ behaviours and make them ready to adopt innovations and improvements (Fullan 2007; Hayes 2014).
In a multinational company, transformational leaders should refer to Kotter’s model because planning the work according to this framework, they can stimulate employees to adopt aspects of the change during a prolonged process. For instance, the coalition working to promote the change knows the following stages of the process, and it can propose better ways to motivate and empower workers to accept the change and employ new rules and norms during regular activities (Goksoy et al. 2012, p. 90).
In this context, the detailed developed plan for the change programme implementation is more beneficial for a large organisation, where leaders need to schedule and organise all steps carefully, with the focus on the principles of diversity, respect for employees’ cultures, and with the focus on the company’s strategic goals.
Guidance and Recommendations
In order to implement a change in a multinational company according to Kotter’s model and with the focus on the transformational leadership, it is necessary to follow a range of steps aiming to address the question of diversity in large organisations.
The proposed recommendations to guide the implementation of a change programme in an organisation are the following ones: (1) to focus significantly on selecting a communication strategy that is used by the leader to explain the necessity of a change during steps 1, 3, and 4; (2) to pay much attention to the creation of the working team for the change development, management, and promotion; (3) to concentrate on developing a vision associated with the implemented change programme; (4) to motivate employees through short-term wins and rewards; and (5) to focus on creating the corporate culture based on the implemented change.
Following the recommendation of selecting a communication strategy by a leader, it is important to explain that employees in multinational companies need to be contacted many times, and a leader should utilise multiple strategies to communicate the urgency of change and a vision to achieve planned results (Cameron & Green 2015, p. 118). The problem is in cultural differences and in the cultural resistance to changes that is typical for the diverse workforce.
The second recommendation is related to creating a coalition for the change project development. It is important for managers to create an active working team, the members of which should be motivated to accept change and serve as role models for other employees resisting to adopt new rules and principles. When team members are motivated to promote further transformations in the organisation, the diverse workforce can respond to changes more actively.
Employees in multinational companies need to have the unified vision of any subject in order to succeed in the teamwork and any activities (Bucciarelli 2015; Hurn 2012). Therefore, following Kotter’s model, leaders should also create the change vision in order to motivate the workforce to achieve the same understandable and important goal.
In order to succeed in the organisational change, employees need to see the results of their work, and encouragement related to short-term wins has the positive effect on the work of the multicultural team. Finally, the last recommendation is based on the concept of the corporate culture.
One of the main tools to manage diversity in a multinational company effectively and to promote a change is the focus on developing the corporate culture because employees need to feel like the part of one team having the same goals and objectives (Goksoy et al. 2012). Thus, the proposed recommendations employ the basic principles mentioned in Kotter’s model in order to implement a change programme in a multinational firm.
An organisational change can become a natural consequence of the development of the multicultural organisation, but the successful adoption of a change requires significant efforts made by leaders who face a problem of motivating employees. The reason is that the organisational amendments usually include the change not only in followed practices but also in employees’ values.
This process becomes a challenging task in large multinational organisations, where leaders need to concentrate on incorporating the ideals of the change into one corporate culture which aim is to unite workers from various backgrounds and with many differences.
The evaluation of traditional change management theories and models demonstrates that Kotter’s model supported by the principles of transformational leadership is one of the most appropriate choices to address the needs of leaders and employees in large companies. The model is efficient because its eight steps cover all appropriate managerial strategies that need to be used in order to convince the staff to accept the change and act according to new rules and norms.
In his model, Kotter pays attention to such details as the creation of coalition, accentuation of urgency, and the focus on short-term wins that work effectively to make the implementation of a change programme as successful project for a firm. Therefore, these aspects and features are also mentioned in the guidance and recommendations for managing change in a company in order to guarantee that leaders can achieve higher results and complete the organisational change process rather efficiently.
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