Marsya Aderizal
Word count : 1655 / PIN : 10296
FIND THE NEXT WAVE TO RIDE ON – NEW BUSINESS STRATEGIES IN CHANGING WORLD Marsya Aderizal
I. Change as a “Trend” in Modern World Human always experience many changes in life. Baby can’t walk or talk yet but then grow bigger and able to walk, talk, and do many things. This kid later become an adult who married, raise kids, and work for pursuing career. After that, he will be old, become weaker, and susceptible to illness. This alteration in growth of human is not the only form of change. There are many cases that a man who was poor but then become very rich because of their effort. See Warren Buffet and Bill Gates. They were nothing in past years before they became very successful in their business just like now. Today, they can be categorized as richest man in the world. There are also cases a man who was known as a successful person but then become futile. Bernard Madoff is one of the example. He was known as a good American Businessman and a former chairman of NASDAQ. Who can predict that he will be charged against many kinds of fraud, sentenced 150 years in prison and $170 billion in restitution, and also referred to as the largest investor fraud ever committed by a single person1? Those cases prove that human is very influenced by change whether it is from their internal or external environment. Companies, organizations, and countries suffer change as well because they consist of human as the main living things. When financial turmoil hit the world economy in 2007, Lehman Brothers bankrupted, Sony, Peugeot, and Ford suffer loss and laid off many of its employees, and export of many countries reduced because of the decrease of purchasing power. We can also see from that example, many changes (bankrupt of a company, laid off of employees, decrease purchasing power) can happen as a result of one change (financial turmoil) happens before. The existence of globalization omit countries boundary and as a result the effect of change can be suffer globally. Expansion of technology is another factor
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Wikipedia, Bernard Madoff, 15 March 2009
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Marsya Aderizal
that create it performs rapidly. That’s why many changes can happen especially in modern world. Trend means the general direction in which something tends to move or a general tendency2. Change is very common in modern world and can be said as world general tendency because modern world tends to change. Hence, change can be referred as trend of modern world. II. Nature of Change Thefreedictionary.com defines change as the act, process, or result of altering or modifying. Change also means a transformation or transition from one state, condition, or phase to another3. We can conclude from those definitions that if something changes then it will differ from the earlier state or condition. That’s why people generally have negative attitudes and perceptions toward changes. People usually worry if something turn out not to be as usual and that they will suffer bad experience from what it results. They don’t like to experience uncertain conditions. In organization, change can be threatening especially if its identity is threatened. Identity is often vested in symbols (job titles, salary, etc) and rituals (working practice). Changing the identity may be essential but if done insensitively may feel like challenging identity. In addition, change can also challenge existing power structure. Therefore it may be blocked by those with power4. This phenomenon is known as resistance to change which makes change be much more difficult. However, change is a trend in modern world. Although most people tend to fear and threatened by it, company have to cope it wisely or otherwise failed. Change can be a threat and an opportunity as well depends on how to get along. Company with breakthrough innovation will become a market leader and accomplish its sales target. In contrast, lots of companies bankrupted in financial turmoil because they couldn’t manage change prudently. Lehman Brothers had to declare bankruptcy because they could not survived the subprime mortgage crisis that leads to financial turmoil. Many financial firms such as Merrill Lynch, 2
Answers.com, trend
3
thefreedictionary.com, change
4
Seel, Richard 2008. The Nature of Organisational Change.
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HBOS, and Washington Mutual had no other choice than to be acquired by other corporations5. Companies should do something in order to survive change. The emerged of this phenomenon redouble the need for organization to do some action. III.Dealing with Change in Business World Making change is not as easy as it can be heard. There are many obstacles in doing some transformations. Lots of issues are involved for instance resistance of change, unexpected result takes place, unsuccessful alteration, challenging identity of organization, and many more. That’s why we need a set of direction to implement change effectively. Dealing with change is related to a term called change management which is the set of processes, tools and practices that are used to manage the people side of a change. Change management is the bridge between "implementing a solution" and an organization ultimately realizing the benefits associated with the change6. Thus, we can use change management as a tool to deal with change. There are three laws in change management adapted from Isaac Newton Law of Motion which are7 : 1.
overcoming the natural inertia in organizations requires constant application of the forces for change
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the greater the inertia or resistance to change, the greater the required forces of change
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the way that change agents treat resisters is the way that resisters will treat change agents
From those principles, it can be concluded that company need forces of change to face the resistance. The treatment to the resisters is also important. There are ten steps to transform company quickly, face the resistance, treats all employees carefully which are8 : 1.
Address the “human side� systematically
5
Wikipedia, Subprime Mortgage Crisis
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http://www.change-management.com/tutorial-change-triangle-mod2.htm
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http://www.businessperform.com/html/change_management_principles.html
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Aguirre, DeAnne. 10 Principles of Change Management. San Fransisco : Booz Company.2004
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Find the Next Wave to Ride On - New Business Strategies in the Changing World
Marsya Aderizal
Change management approach should be fully integrated into program design and decision making. 2.
Start at the top The leaders themselves must embrace the new approaches first, both to challenge and motivate the rest of organization. They should give good examples to all of subordinates.
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Involve every layer Because change affects different levels of company, change efforts must include plans for identifying leaders throughout company and pushing responsibility for design and implementation down.
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Make the formal case Articulation of formal case and written vision statement are invaluable opportunities to create leadership-team alignment.
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Create ownership Ownership is best created by involving people in identifying problems and crafting solutions.
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Communicate the message The best change programs reinforce core messages through regular and timely advice that is both practicable and inspirational.
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Assess the cultural landscape Cultural diagnostic can assess organizational readiness to change, bring major problem to surface, identify conflicts, and define factors that recognize and influence sources of leadership and resistance.
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Address culture explicitly Once a culture is understood, it must be addressed thoroughly to company in change program.
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Prepare for the unexpected Effectively managing change requires continual reassessment of its impact and the organization’s willingness and ability to adopt the next wave of transformation. Global Initiatives Symposium in Taiwan 2009 4
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Speak to the individual People will react to what they see and hear, and need to be involved in change process.
Thus, whatever company’s change business strategies are, they should appropriate with those principles. IV. New Business Strategies in Changing World It is not the strongest of the species that survive, nor the most intelligent, but the one most responsive to change. ~Author unknown, commonly misattributed to Charles Darwin The above quote already describes that businesses should be responsive to change if they want to be long lasting. The most important thing is the degree of responsiveness instead of the size of an entity. Then, company should find a best way to be always responsive to change. Company could not just depend on the practice of change management. It will be better for corporation to blend the principles of change management in its operations activity. How can a business do it? Company should formulate business strategies that suitable and practical for it. However, not all successful strategies are planned. Many successful strategies arise from local experimental or trial and error and succeed but many fail as well. Strategy can be planned but it can also emerge in unexpected and unanticipated ways. That is called as “bottom-up� or Emergent Strategy. To capture the benefit of emerging strategy, manager must foster organizational learning. Organizational learning is the ability of organization to monitor changes in its environment and adjust its processes, products, or services to capitalize those changes9. Organizational learning initiated managers by the use of performance measurement and control system to encourage employees to constantly innovate and search for signs of change10. By this strategy, change in organization can be done in many levels : top level by the management doing encouragement and bottom level by employees learning to innovate
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Robert Simons, Performance Measurement and Control System for Implementing Strategy. (New Jersey : Pearson Hall, Inc), 36.
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Ibid, page 36
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Find the Next Wave to Ride On - New Business Strategies in the Changing World
Marsya Aderizal
and change. In this way, company can always maintain its sustainable change which is very important to make company survive the business. Other important thing that should be remembered is business strategy used to deal with change would useless if all principles of change management are not applied. If we implement organizational learning without starting from the top, doing communication, involving every layer in organization, or creating ownership, the strategy won’t be effective. Good strategy with bad implementation is nothing. We have to combine organizational learning and change management to attain sustainable change. Organizational learning is like a sword with change management as its handle. Hence, change management and organizational learning plays an important role in implementing business strategy and dealing with change.
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