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Organizational Change Management
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Organizational Change Management
Introduction
Organizational changes are inevitable integral part of a modern business in an evolving technological, innovative and dynamic commercial environment. Thus, it is said to change is constant. As such, firms must adopt various modalities of change to maintain and sustain their competitive advantage in a fast-shifting business milieu. Change often occurs induced by external or internal factors, some catalyzed by factors beyond the organizational management. It is imperative to note that some of the famous organizational changes are the mergers and acquisitions, internationalization, retrenching, expanding markets, change in management or policy and government regulations among other variables (Todnem, 2005). The change experienced in Amazon.com was an expansion of the company through acquisition where Amazon.com acquired Whole Foods. The news was communicated by Amazon management, the press, and even bloggers. Within such organizations, in such management changes, leadership and communication are fundamental determinants of the impact of a change in the organization.
Type of change
As mentioned earlier, the type of change in Amazon.com was an expansion change. This is where the company increases in size, capacity, locations, and type of goods and services it offers to her loyal customers. The expansion, in this case, was through the acquisition of Whole Foods. Amazon is an online tech company with specialties in online sales of goods and services. As such, it sells a variety of products online like books, songs, videos, sports and games items among other commodities. However, it had not ventured into foodstuff sales. The purchase of Whole Foods introduced the company grocery chain of product (Todnem, 2005).
Communication
Turner, Wang, and Spencer, (2017), posit that the purchase of Whole Foods cost $13.7 Billion and the company confirmed the official communication. However, a lot of media reports had indicated the interest the firm had in buying a food store. Bloggers and economic pundits had given all kinds of reporting that the data collection ability of consumers that Amazon had was massive enough to benefit from such a purchase (Turner, 2017). The two firms had not given official communications before the deal was reached. As such, the communication patterns were firmly kept between the brokers of such a deal. The employees of the firms were kept in a loop except for the media reports.
Essential to note was that when the deal was confirmed, the CEO of Amazon confirmed that indeed the company had acquired Whole Foods making it official to all Amazon.com employees of the deal. Whitten (2017), advances that a lot of media reports on the acquisition of the firm by Amazon sent shivers and panic to the food store employees who feared to lose their jobs to online sales and marketing for the tech giant (Whitten, 2017). Their communication about the same was majorly through the media. Such deals take long to finalize and agreements to be reached. As such, official communications become very difficult due to lack of certainty of the deals.
Abha (2017), postulates that the shareholders reported having accepted the $13.7 Billion to sell the Whole Foods to Amazon.com. This was a significant source communication and leadership role in passing such communications. When the owners of a firm confirm a sale of their property, then it is as good as a done deal (Abha, 2017). The management of the firm would them send a circular to the branch employees informing them of such changes. Further, the Washington Post advances that the Federal Trade Commission gave Amazon.com the green light to purchase the food enterprise. As such, the communication released to the press was able to reach all the interested parties in the business acquisition.
Leaders Involved in Communication
It is imperative to note that the leaders who were involved in communicating such a message were all senior ranking in the entire transaction. The communication first came from the shareholders of Whole Foods according to the Whitten, (2017). Secondly, the leaders to communicate such a sale were the Federal Trade Commission (FTC), who gave the go-ahead to Amazon for the acquisition. Lastly, the Amazon CEO communicated the news. From such communication, the managers of the firms communicated to the internal members the implications of such a transaction. This was when the information trickled down to all employees. Circulars were used for the information through texts and emails (Whitten, 2017).
Change Model
The change model that was used in the change management process was the Lewin`s change management model. The model advances three stages, which are unfrozen, change and refreeze stages. The first stage of unfreezing encompasses preparing the company for the impending change. This is because more often internal resistance forces tend to prevent such changes (Todnem, 2005). The primary issues at this stage are to explain to people why the change is essential. In the case of Amazon.com, profit maximization and market dominance were the motives. This was witnessed after the sales were officially announced, sales from the grocery store reduced by 40 percent, more customers, flocked the stores and online sales.
The second stage is the change phase where the real transition takes place. Time and proper communication become critical to guide the employees and champion for a smooth change transition. The firm can gauge the market and competitors, and the impact such a change has on the organization. In the case of the Amazon.com`s acquisition, the sales increased by a huge margin before they declined. Such decline gives the firm time to analyze the data and champion the correct path for the firm (Todnem, 2005). The final phase is the refreeze stage where the change has been implemented, and the people have accepted it hence steering the firm to stability. It is the point where things resume normalcy and change fully embraced. For the case of Amazon.com, this stage is yet to be fully experienced.
Figure 1: Change management model: Lewin`s Model
Conclusion
In summation, change management in organizations can be caused by either internal factors or external factors. Among the internal factors as of the case of Amazon includes acquisitions and mergers. With the purchase of Whole Foods by Amazon.com, the change in the leadership structure and employee roles and responsibilities had various impacts. The change also saw some mix-ups in the communication of the same. Moving forward, Amazon.com should consider a town hall face to face meeting with the employees of Whole Foods to get to hear their concerns and contribution to a new enterprise. Also, proper communication in an internal level is imperative in boosting employee morale at the change levels and refreeze phase of the change model. Communication must be adopted in a two-way mechanism. From top to bottom and bottom up.
References
Nick Turner, Selina Wang and Spencer Soper, (June 16, 2017). Amazon to Acquire Whole Foods for $13.7 Billion. Bloomberg Technology. https://www.bloomberg.com/news/articles/2017-06-16/amazon-to-acquire-whole-foods-in-13-7-billion-bet-on-groceries
Abha Bhattarai, (August 23, 2017). FTC Clears Amazon.com Purchase of Whole Foods. The Washington Post. https://www.washingtonpost.com/news/business/wp/2017/08/23/ftc-clears-amazon-com-purchase-of-whole-foods/?utm_term=.fb718a5eda94
Sarah Whitten, (August 24, 2017). Amazon’s acquisition of Whole Foods is ‘a threat to everyone,’ even restaurants. CNBC. https://www.cnbc.com/2017/08/24/amazons-acquisition-of-whole-foods-is-a-threat-to-everyone-even-restaurants.html
Todnem By, R. (2005). Organisational change management: A critical review. Journal of change
management, 5(4), 369-380.
