Companies expanding in competitive space confront complex activities involving managing change and identifying organisational needs in order to survive the evolving business environment. The change process involving dimensions of implementation, adaptation and resistance will be explored by specifically comparing two case studies: the Lakeland Wonders company and the Novotel world Hotel chain. In the first case, Lakeland Wonders a family based business, employ a new CEO not belonging to the family, to make organisational changes in the company that would advance it in new market spaces.
On the other hand, the Novotel Hotel Chain occupying a leading place in global hotel enterprising steered changing mechanisms to respond to emerging business realities in the hotel industry and meeting evolving customer needs. In describing the change intervention at Novotel while identifying the resistance to change at Lakeland Wonders, the context surrounding important policies and activities in change management will be recognised and outlined. Lakeland Wonders Co
The Lakeland Worders company, a manufacturer of high quality wooden toys, had three plants in Minnesota and employed 5,000 persons. A family owned business which following the retirement of CEO Walter Swensen, hired outside professional help of Sheryl Hailstrom to take his place as the driving force that would enlarge Lakeland Wonders retail chain and enhance the company’s market growth. Her expansion vision involved offshore manufacturing, outsourcing a top designer and entering the mid toy product market.
Six months into her new position and despite her efforts to lead by example, such as setting aggressive deadlines, proposing a bonus scheme to the union, travelling on a fast schedule to meet customers, her ideas were not met in support by the other board members. For instance, by suddenly shifting production facilities overseas would involve not only a negative workers Union reaction (in fear of their work positions being jeopardised) but would also risk losing the company’s identity as being an American toy manufacturer.
By overlooking these important issues meant posing a threat to the company’s uniformity. In addition, during management team meetings Cheryl would almost impose these ideas while setting a strict time limit to implement them regardless of the union’s and other board members reactions. The sense of urgency she created for speedy implementation of her ideas, of her radical and new vision of the company along with taking up the role of a solo reformist alienated her from the rest of the management team. Novotel Hotel Chain
Novotel was founded in 1967 by two entrepreneurs, Paul Dubrule and Gerard Pelisson, and quickly expanded to become the market leader in Europe. Through an innovative approach, which involved emphasising standardisation, employing a flexible workforce, providing four-star facilities and three-star service, building hotels on city outskirts, Novotel pioneered the hotel industry in Europe in the 1970’s and the 1980’s. However, in the early 1990’s due to various factors (e. g Europe recession, Gulf war, market competitiveness creating cheaper accommodation) Novotel started to lose its edge.
Moreover internal changes were taking place such as diminish in staff flexibility while the quality control system (Les Boulons) inhibited individual initiative. Despite the profit data that indicated things were doing well, Claude Moscheni believed that a danger signal existed. A first step was to appoint two new co-presidents, Philippe Brizon and Gilles Pelisson, in which together combined different skills and styles. A second step was to rebuild and transform the top management team by adding members instead of customary reducing the size.
To further extent, two anthropologist’s consultants were chosen to shape the platform of the organisation’s culture and encourage brainstorming sessions at meetings. Overall, the project change at Novotel was named ‘Retour vers le Futur’ – Back to the Future. Rejuvenating the enterprise involved changing the management structure by reducing layers and reinforcing front line managers and employees, thus not only cutting down on costs, but also encouraging autonomy among staff and increasing flexibility ultimately leading to greater customer satisfaction.
Moreover communication through the hierarchical structure was enhanced through the creation of ‘reflective clubs’ (Bottom-up) to share problems and solutions and ‘progress groups’ (top-down) to improve service and management. These actions shaped new behaviours at Novotel, strengthening liaisons between departments and reducing rivalry among employees. Staff would organise activities and astonish guests by dressing up, in way of showing their attention to customers. To this extent, teamwork spirit developed on a small scale gradually expanding across the organisation.