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Zensar Company’s Innovation & Change Management Case Study

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Updated: Jul 1st, 2021

Problem Statement

The proposal to create a new unit focused on promoting Solution BluePrint (SBP) at Zensar can help the company improve its competitive position in the global market. Nevertheless, this promising innovation is still in the developmental stages, making it difficult for various stakeholders to believe in its alleged virtues. In contrast, Dilip Ittyera, Zensar’s current CTO, is certain about the project’s favorable outcome and is insisting on heading the new unit. However, some top managers consider that he lacks the necessary skills to manage the initiative well.

To resolve the controversy, Ganesh Natarajan, Zensar’s CEO, must analyze environmental factors and identify the pros and cons of the proposed solution. Overall, implementing the eight-step change model can facilitate the transition to change. In the face of existing obstacles to change, communicating the vision and cross-sectional collaboration are key to establishing the fourth unit and its effective function.

Analysis

Change Characteristics

The proposed initiative can be considered a transitional change. The creation of the fourth business unit implies the implementation of a “new state” (Anderson & Anderson, n.d., para. 2). It refers to the firm’s reorganization and requires staff members to adopt new skills and knowledge to work with SBP and sell it to customers who may be skeptical about this still-unstable technology. However, the company’s operations in the rest of the departments will not necessarily be affected by the change substantially although some alterations in organizational values and vision may be needed along with new approaches to employee communication at the whole-organization level.

Main Resisters

The main resisters in the Zensar case are sales executives, Level 3 project managers, programmers, and customers. Sales executives are responsible for promoting new products and boosting their sales. Among the five reasons for fear of change, uncertainty is the most concerning because people see SBP as an “unproven technology” (Tushman & Kiron, 2014, p. 10), a factor that could hamper the sales effort. In addition, the sales executives may have a fear of adapting to something different because of the difficulty inherent in promoting an unstable product to customers who are already satisfied with the company’s existing, credible products. Uncertainty as a reason for resistance also applies to the group of Level 3 project managers whose main roles are to lead project teams, manage resources, and cooperate with the sales team. If they are not sure about the commercial viability of the new product, they are less likely to engage in improving and promoting an unproven product.

In addition to experiencing uncertainty, the programmers may resist change because it presents a challenge to competence. In this case, the programmers spent years gaining expertise in a specific programming language. However, work with SBP requires gaining new knowledge and skills that have an “uncertain professional value” (Tushman & Kiron, 2014, p. 10). Thus, this group of employees may lack the motivation to engage in the long-term, intensive training needed for successful realization of SBP as they do not anticipate any personal gain. Zensar’s customers also fear change, mostly in the form of possible losses associated with the use of untraditional technology. Since the company has yet to increase the trustworthiness of SBP, customers will likely prefer proven, traditional alternatives. Additionally, due to the originality and innovativeness of the new technology, it is linked to “a perceived loss of control” over projects among customers (Tushman & Kiron, 2014, p. 10), while most of Zensar’s clientele prefer to have control over their projects.

The Problem According to Natarajan

From the CEO’s perspective, the initiative is associated with multiple advantages, including an opportunity to enter new markets and sustain organizational growth. Since Ittyera has the highest amount of technical expertise, knowledge, and experience necessary for working with SBP, he is the most suitable choice for heading up this project. However, Natarajan’s main worry is that Ittyera lacks important managerial skills and competencies for leading the product commercialization and development to success on a large scale. For example, he may be unable to collaborate with other organizational departments effectively and may take too many risks, overpromising the outcome. Additionally, the existing product development team currently working under Ittyera’s lead has a unique culture that will be impacted by the creation of the fourth unit. It is not clear whether the team members will integrate into other departments well and remain as productive and efficient in another culture.

Sense of Urgency

The sense of urgency in the case comes from both internal and external environments. First, the global IT industry has long been searching for a “holy grail” that will “reduce delivery times, increase productivity, lower costs, and improve quality” (Tushman & Kiron, 2014, p. 8). In the face of failure on the part of many other firms, Zensar has made a significant step in the right direction by developing SBP. However, the high demand in the market for graphics-based software approaches and automation implies a risk that rivals may take advantage of the company’s innovation by being the first to offer similar products and thus taking a substantial market share before Zensar. This factor poses a significant threat to the enterprise’s competitive position. As for internal causes, the company is seeking ways to increase revenues and grow, and SBP promises many such opportunities. Therefore, creating a new business unit is in line with Zensar’s current strategic goals.

Main Assistors

The major assistors in the proposed change initiative are Ittyera, who has worked on SBP development from the beginning, his team of developers, and Wagh, the head of sales for Emerging Territories. As CTO, Ittyera is responsible for identifying new technologies and differentiating the company in the market. He has a strong belief in the virtues of the new product and is playing a vital role in communicating its benefits to customers and Zensar’s employees. He managed to ignite the same enthusiasm among the members of his team that has worked intensely to stabilize the product and then began educating other programmers. In comparison, Wagh’s main duty is to promote the company’s products in emerging markets. His role in moving the change forward has been in collaborating closely with Ittyera to find customers who will purchase SBP and maintaining partnerships with them. In this way, both have made it possible to expect SBP commercialization to lead to favorable results.

Change Agents

The main change agents in the case are Ittyera and Natarajan. The former has all the knowledge needed to support the SBP project. Moreover, he is regarded as the primary SBP ambassador because he has a vision for the product’s success. Nevertheless, it is possible to say that Natarajan has better leadership qualities to manage the change initiative and enhance collaboration among stakeholders. He is both people- and task-oriented, making his involvement in the project pivotal.

Gap Analysis

The “to be state” is as follows: integrating into unexplored markets and attracting new potential customers with the help of a stabilized SBP version under the leadership of a competent and inspirational manager and in the context of whole-organization collaboration. Currently, both existing and potential customers are reluctant to use the unproven software development framework, and more critical wins involving customer attraction are needed to solve this problem. Second, some members of the top management team are expressing concerns about making Ittyera the head of the fourth unit, indicating his lack of managerial skills. This factor can contribute to conflicts and undermine cross-sectional collaboration and productivity. Thus, it is necessary to find a compromise between Ittyera, who is eager to lead the project, and other executive managers.

Missing Steps

The three steps of Kotter’s model that the CEO has missed include communicating the vision, empowering others to act, and planning for and creating short-term wins. First, the high level of resistance to change observed among different groups of employees indicates that management has failed to teach new behaviors to subordinates. For example, sales executives do not want to promote SBP among existing customers who are currently satisfied with Zensar’s services. This points to the company having no comprehensive strategy to communicate the vision across departments and leads to the second and the third missing steps, which imply “getting rid of obstacles to change” in terms of removing work structures undermining change and planning for performance improvements (Kotter, 2011, p. 2). These can be combined by creating a reward system that can motivate employees to work toward project success. For example, programmers are not willing to learn SBP because its professional value is uncertain. Thus, it would be helpful to align the organizational vision with staff members’ interests such as financial benefits and recognition. Lastly, establishing the fourth business unit may help to remove structural obstacles and create new targeted job categories.

References

Anderson, D., & Anderson, L. A. (n.d.). Web.

Kotter, J. P. (2011). HBR’s 10 must-reads: On change management. Boston, MA: Harvard Business Review Press.

Tushman, M., & Kiron, D. (2014). Web.

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