The Purpose of Studying the Organizational
There is no secret that the recent “Fat Tax” has caused quite a stir among the Danish public, and especially among the owners of the Danish food producing enterprises (Cooper, 2012). Analyzing the effects of the reform in the context of a specific organization and taking a closer look at the changes that the Fat Tax has inflicted on it, one can possibly decide whether the Danish companies in general and a specific food-producing organization in particular can survive the changes.
Brief history about the company
KiMs has been around in the world of the Danish fast food production for quite a while. Offering chips and snacks, the company was initially an affiliate of the Finnish headquarters. However, as the sales grew, the company expanded, taking over the fast food market in the Scandinavian countries and ousting the rest of the fast food services (KiMs, 2012).
The organizational context for change
Previously focused on the production of typical fast food, KiMs produced the food that had been enjoying wide popularity among the Danish people from all walks of life, starting with teenagers to businessmen and office employees. In addition, the source materials for producing fast food with sufficient amount of fats allowed for a flexible financial strategy.
However, after the Fat Tax reform, KiMs was to lose not only a part of their revenues to the government tax companies, but also a considerable part of their clients, mainly because fast food was considered not appropriate for healthy lifestyle.
Therefore, KiMs had to reform its organizational process, or, to be more exact, the production stage had to be changed greatly. The company had to come up with a substance that could replace fats, which, in turn, could have influenced the entire production process and cost KiMs a lot of money.
The driving forces behind the change
As it has been mentioned previously, the key driving force behind KiMs’s organizational change was the new tax that was imposed on the companies producing food that contained more fats than corresponding regulations allowed. As a matter of fact, KiMs offers a perfect example of how an organizational change concerning such an important element as the production process can be carried out without the company suffering any significant losses.
As the KiMs’s spokesman, Andersen, said in his interview, “We have shifted all our crisps and snacks to sunflower oil” (Obesity and the Fat Tax Issue, 2011). This is exactly how a company should react to the changes that the government or any other force imposes on it. Without wasting their time on arguments, the company has chosen the least painstaking and the most reasonable way of shaping their production to meet the new requirements.
The parties and stakeholders involved
According to the existing record, the head of KiMs managed to handle the situation on their own without attracting any parties. As for the company stakeholders, Andersen claims that the change is not going to harm them, since neither the company, nor its reputation has suffered any damage. Especially in the light of the recent abolishment of the additional taxation of food, it is clear that the company will have to undergo a number of changes.
Moreover, the fact that the taxation of the food products containing fats will be cancelled (Denmark scraps fat tax in another Big Food victory, 2012) means that the company will have to undergo an additional change, which is going back to the traditional financial strategy and rearranging its production system. Thus, “Fat Tax” was developed with a good intent, yet the organizational changes that it drags test the company’s viability in a rather harsh way, making it shift from one strategic plan to another.
Reference List
Cooper, B. (2012). Nutrient taxes: European moves on nutrient taxes fuel debate. Web.
Denmark scraps fat tax in another Big Food victory (2012). Web.
KiMs (2012). About KiMs. Web.
Obesity and the Fat Tax Issue (2011). Web.