The Eight Step Model of Change - a Case Study on Ericsson

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The fact that the world is changing in a high pace enforces many businesses to keep abreast of relevant updates, and then integrate what may make a business more sustainable from a marketing perspective. The need to change may stem from technological breakthrough that becomes part of market requirements and customers’ needs afterwards. Additionally, changes in a national and global economy may also impose some organizational adjustments or even radical changes (Bharijoo, 2005). An interesting example comes into the play is the cassette industry that became obsolete after CD and DVD technologies have been integrated in our life to a high extent. At the moment, the rapid development of web computing and cloud industry along with the same pace of development for telecommunication systems, as found in 4G, makes it high risky to keep investing in CD and DVD technologies. Instead, big companies study and set endless scenarios for the development of overlapping technologies that may affect the future of their industries, and thus they found themselves obliged to keep their infrastructures values, visions, regulations and policies updated. For that, the need for organizational change depends on the nature of industry. It becomes more necessary if it is more connected to a technology with high changing dynamics such as telecommunication systems and related services. Based on that, this study is dedicated with a view to discuss the change management process for the transformation from 3G to 4G at Ericsson in comparison with Kotter’s Eight-Step Change Model (Kotter, 2012).

Transcript of The Eight Step Model of Change - a Case Study on Ericsson

  • Institutionen fr informatik Change and Knowledge Management THE EIGHT-STEP CHANGE MODEL IN PRACTICE A CASE STUDY ON ERICSSON Authors: Milos Zec Hafez Shurrab
  • TABLE OF CONTENTS 1. INTRODUCTION..........................................................................................................- 1 - 2. Kotters Eight-Step Change Model ................................................................................- 2 - 2.1. Establishing a Sense of Urgency.................................................................................... - 2 - 2.2. Forming a Powerful Guiding Coalition ......................................................................... - 3 - 2.3. Creating a Vision ........................................................................................................... - 3 - 2.4. Communicating the Vision ............................................................................................ - 3 - 2.5. Empowering Employees for Broad-Based Action......................................................... - 3 - 2.6. Generating Short-Term Wins......................................................................................... - 4 - 2.7. Consolidating Gains and Producing More Change........................................................ - 4 - 2.8. Anchoring New Approaches in the Culture................................................................... - 4 - 3. RESULTS: INTERVIEW...............................................................................................- 4 - 4. CASE ANALYSIS .........................................................................................................- 9 - 4.1. Establishing a Sense of Urgency.................................................................................... - 9 - 4.2. Forming a Powerful Guiding Coalition ....................................................................... - 10 - 4.3. Creating a Vision ......................................................................................................... - 10 - 4.4. Communicating the Vision .......................................................................................... - 10 - 4.5. Empower Others to Act on the Vision......................................................................... - 11 - 4.6. Plan For and Creating Short-Term Wins ..................................................................... - 11 - 4.7. Consolidate Improvements and Producing Still More Change.................................... - 11 - 4.8. Institutionalise the New Approaches ........................................................................... - 12 - 5. DISCUSSIONS ............................................................................................................- 12 - 6. CONCLUSION ............................................................................................................- 13 - 7. REFERENCES.............................................................................................................- 14 -
  • - 1 - 1. INTRODUCTION The fact that the world is changing in a high pace enforces many businesses to keep abreast of relevant updates, and then integrate what may make a business more sustainable from a marketing perspective. The need to change may stem from technological breakthrough that becomes part of market requirements and customers needs afterwards. Additionally, changes in a national and global economy may also impose some organizational adjustments or even radical changes (Bharijoo, 2005). An interesting example comes into the play is the cassette industry that became obsolete after CD and DVD technologies have been integrated in our life to a high extent. At the moment, the rapid development of web computing and cloud industry along with the same pace of development for telecommunication systems, as found in 4G, makes it high risky to keep investing in CD and DVD technologies. Instead, big companies study and set endless scenarios for the development of overlapping technologies that may affect the future of their industries, and thus they found themselves obliged to keep their infrastructures values, visions, regulations and policies updated. For that, the need for organizational change depends on the nature of industry. It becomes more necessary if it is more connected to a technology with high changing dynamics such as telecommunication systems and related services. Based on that, this study is dedicated with a view to discuss the change management process for the transformation from 3G to 4G at Ericsson in comparison with Kotters Eight-Step Change Model (Kotter, 2012). Ericsson is a global company for technology localized in many countries around the world. The main services Ericsson delivers include providing and operating telecommunications networks, video and television systems, and other related services (Ericsson, 2013). Change management and organizational learning are two of fundamental elements of Ericsson practices. Change projects are not only applied internally in Ericsson, they also provide consulting services in that respect. One popular service they offer is called Ericsson Program & Change Management (Ericsson, 2013). Figure 1 shows many transformations that occurred in Ericsson over history. Specifically in 2008, the company became capable to provide and operate 4G systems, the fourth generation of mobile phone mobile communication technology standards. The successor standard, 3G, has been first integrated in 1999 (Ericsson, 2013). Under the pressure of their global competitors and to keep their remarkable market share, Ericsson adopts the behaviour of learning organization to keep its development progress responsive to the market demand, economic growth, new technology, and new opportunity growth.
  • - 2 - Figure 1: Historical Change and Development in Ericsson 2. Kotters Eight-Step Change Model Kotter (2012) suggested a model for managing changes within organizations. He observed the behaviour of more than 100 companies and proposed eight steps to be followed to increase the likelihood of success of changes to be integrated. The order of the eight-step model is important to be followed. 2.1. Establishing a Sense of Urgency Kotter (2012) claims that any change needs to be taken seriously to have a good chance to succeed. One way to do that could be by making the effects of a changes absence visible as much as possible. That may include recession in competitiveness, market shares, and financial performance. There should be at least 75% of a company of whom are agreed that the current situation would not lead to a satisfactory future. By making that happens, an urgent atmosphere could be created, and thus, the complacency level becomes low and staffs get out of their comfort zones.
  • - 3 - 2.2. Forming a Powerful Guiding Coalition Change momentum are pushed using a force of effective organizational power that are agreed on making that change. Therefore, a change is more likely to be happened if it is led by a powerful guiding coalition. Power here does not only refer to organizational titles, but that also includes expertise, relationships, and reputations. Without that kind of cooperative coalition, it is quite difficult to confront resistance actors and absorb their reluctance. People seem to value changes that are led by important organizational characters more than the need to make a change. Therefore, there is a high risk for any change to be taken seriously if not led by a powerful group of people (Kotter, 2012). 2.3. Creating a Vision Having a vision for any organization plays a significant role in guiding staffs to where the organization is going to. Any plan is then built according to the need of the organizational vision. Having a vision is thus as same as having a destination, while the related plans are as same as using a compass to reach that destination. On the other hand, lacking a vision may result in irrelevant plan, and thus confused staff, which may eventually lead to incompatible projects and activities that make the organization ends up in the wrong direction (Kotter, 2012). 2.4. Communicating the Vision Kotter (2012) emphasizes that it is not enough to have understandable, simple, clear, and strongly relevant vision. Without harnessing all possible methods to share and promote that vision, it would be still comprehended at a limited organizational level. Kotter (2012) also highlights the importance of giving examples for how to achieve a vision by setting different strategies for example, which makes it quite easier to be comprehended by the staff. Under communicating the vision maybe resulted from developing a vision, but using only a single form of communication. Moreover, managers do not adopt the principle of walking the talk quite often, nor remind of the desired behaviours. 2.5. Empowering Employees for Broad-Based Action Any implementation of a major change requires actions from people (Kotter 2012). It is very possible that any effort will fail if someone from a team, supervisor or especially some executives try to undermine the effort to implement a change. Kotter (2012) emphasizes the importance of such employees to be recognized since a whole project maybe led to a disaster. There is also tremendous importance of leaders to help employees to overcome their barriers during implementation as they in most cases exist only in their heads.
  • - 4 - 2.6. Generating Short-Term Wins It is obvious that big and serious transformations require long time to be accomplished. In most cases a project that is aimed to bring a transf