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It is a well-known fact that understanding and leading change helps participants prepare for the difficulties inherent in starting and executing change. As the business environment is constantly changing, it is critical to recognize market circumstances and make necessary adjustments to guarantee the firm's growth and success (Schell, 2019). Tesco was chosen to illustrate this notion since it is a British multinational retailer of groceries and general products. This study discusses a variety of issues, including how change affects a corporation's strategy and operations, how drivers of change influence organizational behavior, and how obstacles to change impact leadership decision making. Apart from that, it explains how to employ a variety of leadership styles while directing a change project. The study also considers the organizational example of Tesco and Marks & Spencer to analyse and compare the impact of change in each of the organization’s strategy and process. The various leadership approaches that are incorporated to manage change within organizational context are also outlined in the following report.
LO1 Compare ways by which change impacts on an organisation's operation and strategy
P1 Compare various organisational examples where there has been an effect of change on an organisation'soperations and strategy
Organizational process is designed in order to fulfill corporate goals, and it is critical for companies to build an effective plan that is tailored to the operating procedures so that work may be completed efficiently(Choromides, 2018). To flourish in a dynamic environment, it is critical to analyze demand and preferences in order to create policies that promote the corporation's development. Operational procedures differ as per the nature, size, industry, and kind of business. It is needed to do research into the variables that influence and impact the company's management and operations in order to ensure long-term viability in the external environment. Tesco built their brand image on the basis of cheap prices and outstanding service. In contrast to Sainsbury's and Marks & Spencer, Tesco enhanced its brand image by using the brand's power, approval ratings, and originality of brand connection (Awadari and Kanwal, 2019). Tesco achieves customer happiness through improving their employee service, which aligns with the Tesco motto "Everything little helps". Moreover, Tesco generated value for the customer in order to win their lifetime loyalty (Awadari and Kanwal, 2019). This implies that Tesco will do all necessary to meet the customer's needs but will place a priority on service; as a consequence, Tesco will earn the customer's brand loyalty. The significant changes which are adopted by Tesco in comparison to other organizations are listed below:
Basis of Difference
Marks & Spencers
Marks & Spencer outlined its plans to accelerate the pace of change in its company as more clothes and home goods are sold online and more food is delivered directly to the house. The retailer claims that "rapid transformation is the only choice" in light of this channel shift, which is compounded by increasing competition from discount retailers in a difficult consumer market. M&S's strategy now is to decrease expenses by at least £350 million by becoming more efficient and reducing waste, while also accelerating its shop closure plans (Heikkurinen, Young, and Morgan, 2019). M&S is also seeking to regain its'special' status in British family life by focusing on "strengthening core shopping objectives with new lines that appeal to a broad range of family age consumers and daily occasions."
A review of the marketing mix also was necessary, and Tesco took this step by introducing a new range of new farm brand goods. This drastic rebranding of goods such as beef, fish, pig, and fruit allowed Tesco to appeal to cost-conscious customers who partially completed the retailer's offers (Evans and Mason, 2018). Tesco's basket of farm-style goods was about 15% more costly prior to the rebranding. The brand recognized the need to operate in this area and therefore reduced pricing. As a consequence of the new price point, farm and seafood sales increased significantly.
M&S is now recommending making changes and creating a new retail management structure that is constantly improved by eliminating role duplication, making clear leadership accountability, and refocusing retail teams on the customer (Bailey et al., 2018). The changes proposed would affect 950 roles along all central support functions
in sector and central operations, as well as property and store management.
Tesco has undergone radical changes as a result of adapting to changing market conditions by implementing self-scan checkouts to reduce lines in shops (Evans and Mason, 2018). This is a newer kind of technology that grocers have invested in to keep their customers happy by reducing time spent in queues.
Technology, consumer preferences, regulations, competition movements, and supplier and sourcing instability are all factors that influence change in an organization. For instance, in Tesco the change in technology and competitive pressure have forced the organization to adopt self-scan checkouts to reduce lines in its shops (Awadari and Kanwal, 2019). This technology enables retailers to enhance customer experience and the entire store experience while also controlling operating expenses as they continue to evolve with an expanding variety of goods and in-store, online, and mobile purchasing channels.
Furthermore, the main driver of change in the organization Marks & Spencers includes the growing competitiveness that it faces from its competitors that has made the organization opt for online delivery for its product to sustain in the retail market in UK. This has led the organization to decrease expenses by at least £350 million by becoming more efficient and reducing waste, while also accelerating its shop closure plans (Heikkurinen, Young, and Morgan, 2019). M&S is currently recommending reforms and the establishment of a new retail management structure that is continuously enhanced via the elimination of redundant roles, the establishment of clear leadership responsibility, and the refocus of retail teams on the consumer. The proposed adjustments would impact 950 jobs across all sectors and central operations, as well as property and store management.
Internal and external factors have a significant impact on a business's success or failure. While business leaders cannot control external variables, they should be able to foresee and adapt to them in order to maintain the viability of their companies. However, company owners and executives do have significant control over the internal variables that affect a firm, and their handling of these internal issues will have a big effect on their businesses' future success. External influences affecting organizations include political, economic, social, and technical issues (Blanco-Portela et al., 2017). Internal variables affecting a team's performance also define how an organization interacts with its external environment in these areas. Leaders who are able to learn and effectively communicate with their team may also learn from and communicate effectively with their team's environment, leading in an interchange of ideas that benefits both the team and the company. TESCO has been able to apply its methods successfully and efficiently over the years to become one of the world's largest retailers. Both internal and external factors contributed to the transformation at TESCO. The following sections cover the primary triggers:
Effects on leadership: Change drivers may enable Tesco's leaders to explore novel methods for motivating team members and achieving peak performance (Miao et al., 2018). One might claim that at times of transition, organizational leaders may face stiff opposition from their followers. Not only that, but there may be instances when Tesco's leadership should be shifted from democratic to authoritarian in order to forcefully execute the change.
Effects on team behaviours: Change drivers may well have a significant impact on team behaviors at Tesco. One might argue that team members may oppose improvements to their functioning and productivity that are needed (Blanco-Portela et al., 2017). As a result, companies and managers may need to rethink their strategies for modifying team behaviors in response to new circumstances.
Effects on individual behaviors: When analyzing the implications of change drivers on individuals, it is fair to presume that employers and employees in the organization will become less motivated to participate in the change and acquire a negative attitude about the change (Evans and Mason, 2018).
Tesco may consider a number of steps to mitigate the negative effects of emerging changes on organizational behaviors. These measures are described in more detail below.
Effective leadership: Effective leadership is among the most effective strategies for mitigating the negative effects of change on organizational behaviors. As per the research, executives at Marks and Spencer must develop situational leadership in order to successfully execute change strategies within the organization (Al-Ali et al., 2017). Not only that, but leaders within the organization are also required to provide an example of excellence by demonstrating best practices that may be emulated by workers or team members. Thus, leadership style is a critical element in minimize the impacts of change.
Strong plan development: In addition to enhanced leadership, Tesco is required to develop plans and strategies that will encourage workers to adopt new practices. Not only has this occurred, but leaders and managers inside an organization have required the development of educational and training programs. This manner, Tesco's workers will become accustomed to the new practices and changes, gradually reducing resistance to change implementation.
Effective Communication of Change Plans: Among the worst outcomes of a change management process is the spread of misconceptions and gossip among staff in the devoid of clear and consistent management communication (Stouten, Rousseau and De Cremer, 2018). Having a communications plan in place and utilizing a variety of communication tools to ensure that the employees are informed well about change's prime purpose is critical for Tesco to minimize negative effect of the change.
TESCO has been able to deploy its methods successfully and efficiently throughout the years to be one of the world's largest retailers. Both internal and external factors led to the transformation at TESCO. The following sections cover the primary triggers:
Creation of Customer Value: As part of TESCO's goal to maintain current existing customers and attract new, the Company decided to add value to their shopping experience. As a response, the self-checkout system was implemented (Awadari and Kanwal, 2019). TESCO wanted to enhance the shopping experience for its consumers.
An expanding customer base: TESCO's success may be attributed to a variety of reasons, one of which is its rapidly expanding client base. Self-checkout was developed to alleviate congestion at Checkouts. Customers no longer have to wait in long, tedious lines to pay for their purchases thanks to the introduction of self-checkout (Evans and Mason, 2018). They can utilize self-checkout, which is fast and convenient, particularly if the client just buys a few things.
Innovations in technology: With the advancement of technology, it is important for all organizations to improve their technologies if they want to succeed. TESCO introduced self-checkout to increase operational efficiency (Evans and Mason, 2018).
Competition: Competition between companies is a frequent catalyst for development in the majority of industries. TESCO developed the self-checkout technology in order to acquire a competitive edge over its rivals (Choromides, 2018). This also resulted in market difference, as TESCO differentiated itself from other shops via the adoption of the self-checkout system.
This is probably the most prevalent impediment to change management that Tesco may face. Employees have an inherent dread of change, and unless they have been actively engaged in the change process, even for the most devoted member of your staff is likely to oppose the change. The most common problem made by some companies is a failure to involve workers in the transformation process (Kimani, 2020). This promotes dread of the unknown, apathy in embracing a new culture, and eventually a total resistance to change. This also has an effect on organizational leaders' decision-making, since employee involvement is a necessary component of change management.
Certain businesses lack an efficient communication strategy. Indeed, some top leaders usually believe that once they announce a change, employees will adapt and be prepared to begin. This is the dumbest method to introduce change, and hence the reason for the change's strong opposition(Stouten, Rousseau and De Cremer, 2018). These barriers have an impact on leadership decision-making when they are perceived to be significant enough to result in the failure of the change effort.
Occasionally, the planning staff is totally unaware of how the change will impact individuals. Obviously, the team will focus exclusively on planning the administrative organization, work area duties, job obligations, and job reporting structure at this stage (Awadari and Kanwal, 2019). Almost always, the planning team sees things based on emotions and intuitions. This totally ignores how people feel, reason, and operates, thus forming a gap to change.
Kurt Lewin's Force-Field Theory, which asserts that organizations are balanced between forces for and against change, provides a perspective through which managers may bring about change in their companies (Krzysztof, 2018). The driving forces for the change management of Tesco include:
Effective leadership: Tesco's management adopted a democratic form of leadership, dubbed participatory leadership, in which employees' views are recognized throughout decision-making (Miao et al., 2018). Tesco's leadership encourages its people, and as a result, the organization continues to manage change well.
Technological factors: With technological advancements, it is critical for all businesses to improve their technologies if they wish to flourish. To improve operational efficiency, TESCO used self-checkout.
Customers: The success of TESCO may be attributed to a multitude of factors, one of which is the company's continually increasing customer base. Self-checkout was designed to relieve congestion at checkpoints (Rinta-Kahila et al., 2021). Due to the advent of self-checkout, customers no longer have to wait in lengthy, tiresome queues to pay for their purchases.
Human Resources: Tesco's human resources team's primary objective is to continuously enhance the skills and quality of its workers in order for them to offer as much as possible to the business (Lee, Looi and Woo, 2018). They guarantee that workers maximize their potential and provide their all to the organization's success.
The resisting forces for the process of change management and leadership include:
Absence of communication strategy: Tesco does not have an effective communication strategy. Indeed, senior executives frequently believe that once a change is announced, people will adjust and be prepared to begin (Stouten, Rousseau and De Cremer, 2018). This is the most illogical way to bring change, which explains why the change faces such tremendous opposition.
Ineffective planning: Ineffective planning for change integration is another resistant force that is likely to have an influence on the organization's change implementation and management.
LO4 Apply a range of leadership approaches to a change initiative
P5 Incorporate various leadership approaches to dealing with change in a range of organisational contexts
The transformational and situational leadership approach can be incorporated to manage change in retail organizations like TESCO.
Situational Leadership Approach:
The situational leadership approach claims that there is no one ideal way to lead people and highlights that a leader's style and conduct must be determined by his or her followers' qualities. Specifically, the situational approach to leadership model teaches leaders how and where to show the most successful leadership style depending on their followers' preparedness. This approach asserts that when a leader's behaviors are matched to his or her followers' skill, willingness, and degree of confidence, the leader will extract optimum performance from them(Walls, 2019). Tesco may adopt this approach to instill organizational culture and promote more effective leadership in order to manage change.
Transformational Leadership Approach:
Transformational leadership is defined as a leadership style that results in good change for both people and social systems. It’s ideal form leads to significant and beneficial change in disciples, with the main goal of converting followers into leaders. Transformational leadership encourages members of a group in emerging into individuals who look beyond their personal self-actualization and self-interests to the team's or institution's larger benefit (Tabassi et al., 2017).The leader promotes the moral growth of his followers in order for them to absorb these same values and beliefs. Thus, this approach of leadership seeks to encourage employees to follow positive change, which will in turn enable Tesco to effectively manage change in the organization.
M4 Analyse the extent to which leadership approaches can offer organisational change properly applying appropriate models
Tesco desired to implement self checkout systems progressively in order to reduce change resistance and improve competitive power. To implement the new initiative, the strategic manager chose Kotters change model since the change initiative should be implemented progressively over a short period of time. Furthermore, this change endeavor involves minor technology changes, and this organizational change is suitable for such adjustments as well. Tesco has launched the following change initiative.
Create a sense of urgency
Tesco decided that it needed to improve the competitive position and enhance customer service in order to maintain its market leadership position. As a consequence, it sought for new technologies that might help cut costs and enhance customer service, as technology is rapidly evolving (Kang et al., 2020). Market & Spencer launched a new technology self-checkout system in 2002, which Tesco closely monitored. As a result, Tesco decided to implement a self-checkout system as a change initiative.
Form a team for a power coalition
It formed a group comprised of an area manager, supervisor, and trade union representative with the power and authority to effect meaningful change.
Create a distinct vision
The company's new vision is to be profitable, to deliver excellent customer service, and to embrace technology.
Communicate the vision
To create a vision, the team used the company's website and cascaded the information from the area manager to the supervisor, who then held meetings with the other workers to discuss the aims.
Empower others to carry out their vision
Change managers conduct education and training programs to instill the importance of self out systems and to assist employees in overcoming obstacles. Special education sessions have been organized for workers who were obstructing progress (Rajan and Ganesan,2017). The company announced awards for employees from each store who helped to make the goals a reality.
Create short-term wins
Following the conclusion of the trail project, Tesco released a report on its website and stories were published in the press.
Consolidating gains and generating more change
Institutionalize the new approaches
To conclude, it can be stated that change management and leading change forms an integral part for an organization’s success. This study investigates a number of topics, including how change impacts a corporation's strategy and operations, how change drivers influence organizational behavior, and also how change impediments affect leadership decision-making. Apart from that, it illustrates how to manage a change project effectively by utilizing a variety of leadership styles. Additionally, the study uses Tesco and Marks & Spencer as organizational examples to evaluate and evaluate the impact of change on each organization's strategy and processes.
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