ms-26 mba assignment july dec 2010 Question 1

1. What is Alienation? Briefly describe and discuss different approaches to Alienation.

            The issue of employee alienation can refer to several different issues: alienation from the company as well as alienation from society as a whole. Companies and the way they are structured have an effect on both of these factors, and the corporate culture which permeates an organization can determine whether its employees enjoy a high level of morale, or whether they feel alienated from their surroundings and their employer.
Where employees only communicate with their managers when there is a problem, can create feelings of alienation because the employee's only contact with the manager is when there are negative circumstances involved. - Managers who take the time to let employees know when they are doing a good job, not only build a better personal relationship with the employee, but also build a situation where the employee feels valued by the organization. Again, this managerial approach requires active participation by the company as a whole, beginning with the upper echelons of management.

            Company structure itself (the organizational structure) can also be a factor in whether employees feel that they are part of the organization, or whether they feel alienated. Companies which have hierarchical organizations with many layers of management are likely to have artificial "walls" between workers. Companies which are structured in a more vertical manner, meaning that they have fewer layers of management, are more likely to have employees who feel that they are an important part of the organization and who are not alienated from the company. It is important for companies to develop cultures and organizations which foster employee  participation. There are two major alienation factors.

1. Individual Personal Factors.

Individual personality
Individual values
Individual belief
Individual job satisfaction
Supervisor impact on the individual
Individual personal ethics
Lack of mentoring

2.ORGANIZATIONAL FACTORS.
The relationship between two types of alienation--alienation from work and alienation from expressive relations--and
- two structural properties of organizations--centralization and formalization . Both alienation from work and alienation from expressive relations are found to be more prominent in highly centralized and highly formalized organization

ORGANIZATION FACTORS INFLUENCING INDIVIDUAL ALIENATION.
Hierarchy of Authority  impact on the individual and their reaction.
1 Even small matters have to be referred to some one higher up for a final answer.
2 I have to check with the boss before I do almost anything.
3 A person who wants to make his own decisions would quickly become discouraged .
4 Everyone here has one superior to whom he regularly reports.
5 There can be little action until a MANAGER approves a decision.
6 Staff members always get their orders from higher up.
7 I get approval for decision I make.
8 Only MANAGERS can decide how things are to be done.
9 Employees are expected to follow written orders without questioning them.
10 As if going through the proper channels is more important than doing our jobs right.
11 Whenever we have a problem, we are supposed to go to the same person for an answer.
12 Going through the proper channels is constantly stressed.
THIS ABOVE REMARKS SHOWS
[ lack of involvement,
-lack of empowerment
-lack of responsibility
-lack of accountability
-no role in decision making
-limited options]
1. Even small matters have to be referred to some one higher up for a final answer.
2. I have to check with the boss before I do almost anything.
3. A person who wants to make his own decisions would quickly become discouraged
4. Everyone here has one superior to whom he regularly reports.
5. There can be little action until a MANAGER approves a decision.
6. Staff members always get their orders from higher up.
7. I get approval for decision I make.
8. Only MANAGERS can decide how things are to be done.
9. Employees are expected to follow written orders without questioning them.
10. As if going through the proper channels is more important than doing our jobs right.
11. Whenever we have a problem, we are supposed to go to the same person for an answer.
12. Going through the proper channels is constantly stressed.

13.Division of Labor impact on the individual and their reaction.

  13. We are expected to do all types of work.
  14. Employment involves a variety of tasks and responsibilities from day to day .
15. We do a lot of paper work, which could be done by others.

16. We do not receive adequate training.
17. Assignment of duties is made without regard for the individual's experience or training
18. There is an overlap in the job responsibilities.
19. There is really no systematic procedure for promotion.

THIS ABOVE REMARKS SHOWS
[ lack of effective delegation,
-lack of training
-lack of proper job descriptions
-lack of effective systems/ procedures
-limited options]
WHICH CREATES ALIENATIONS OF INDIVIDUALS.
------------------------------------------------------------------
Rules and Regulations
impact on the individual and their reaction.
20 Smoking is permitted only in certain designated places.
21 People here make their own rules on the job .
22 Staff cannot take leave unless they have permission.
23 Staff members feel as though they are constantly being watched to see that they obey all the
rules.
24 Rules govern the style and type of clothing, which I wear to the workplace.
25 I follow rules stating when I am to arrive and/or depart from the workplace.
26 I obey a lot of rules regarding my personal behavior in and around the workplace.
27 I follow workplace rules, which regulate my attendance.
28 Employees are aware of rules regarding their behavior in and around the school.
29 We are to follow strict operating procedures at all times.
30 Employees follow clearly specified procedures for doing the job here.
-----------------------------------------------------------------------------
THIS ABOVE REMARKS SHOWS
[ -some staff dislike strict rules/ regulations.
-some staff hate strict supervision.
WHICH CREATES ALIENATIONS OF INDIVIDUALS.
------------------------------------------------------------------
Procedural Specifications
impact on the individual and their reaction.
31 Standard procedures are to be followed in almost all situations.
32 The organization stresses following the established procedures.
33 Whatever situation arises, we have procedures to follow in dealing with most matters.
34 The same procedure is used in different situations.
35 There is only one way to do the job- the boss's way.
36 The same procedures are to be followed in most situations.
37 Standardized workplace methods and procedures are used by all staff-members.
THIS ABOVE REMARKS SHOWS
[ some staff dislike strict procedures.
-some staff dislike standardized methods/ procedures. 
WHICH CREATES ALIENATIONS OF INDIVIDUALS.
------------------------------------------------------------------
Formality in Relations
impact on the individual and their reaction.
38 The management here sticks pretty much to themselves.
39 No one here calls his superior by his first name.
40 The relationship in this organization is really very impersonal.
41 People who have been warned, are instructed in roper procedures for talking with
them.
42 The management does not like staff get-togethers if it is not for official matters.
43 My relations with other staff are formal and impersonal.
44 Staff meetings proceed in a formal manner.
THIS ABOVE REMARKS SHOWS
[ lack of informality,
-lack of flexibility 
-lack of understanding of others]
WHICH CREATES ALIENATIONS OF INDIVIDUALS.
------------------------------------------------------------------
Promotions Based on Technical Competence
impact on the individual and their reaction.
45 People are not promoted simply because they have "pull."
46 Promotions are based on merit in this organization.
47 (People here are given raises according to how well they are liked rather than how well they do
their job .
48 There is little chance for promotion unless you are "in" with the boss .
49 In order to get a promotion, you have to "know somebody" .
50 Past experience plays a large part in the assignment to this organization.
51If you do not support management, how well you do your job is not important .
52 The functions are highly departmentalized.
THIS ABOVE REMARKS SHOWS
[ lack of credit to merit,
-lack of transparency
-lack of credit to talent
-lack of recognition ]
WHICH CREATES ALIENATIONS OF INDIVIDUALS.
------------------------------------------------------------------
LACK OF Friendly Climate
impact on the individual and their reaction.
53 A person gets no chance to develop good friends here.
54 A very friendly atmosphere is not evident to everyone who works here.
55 The management never sponsoring employee get-togethers.
THIS ABOVE REMARKS SHOWS
[ lack of friendliness,
-lack of management support
-lack of warmth in the working climate
WHICH CREATES ALIENATIONS OF INDIVIDUALS.
------------------------------------------------------------------
SENSE OF POWER SCALE
impact on the individual and their reaction.
1. I do things at this workplace that I would not do if it were up to me.
2. When things get rough in my workplace l, I just have to take it the way it is .
3. managers are not open to my ideas on workplace matters.
4. I have not been given enough authority to do my job well.
5.There are lots of things I can't do although I know they are right .
6.If only I could do my job more independently .
7. I am not given chance to contribute to important decisions made about the workplace.
8. I have little to say over what will work with me on my job .
9. If I really want, I cannot force the changes in rules.
10.I feel that I do not know what is going on in the upper levels of administration .
THIS ABOVE REMARKS SHOWS
[ lack of involvement,
-lack of empowerment
-lack of responsibility
-lack of accountability
-no role in decision making
-limited options]
WHICH CREATES ALIENATIONS OF INDIVIDUALS.

ms-25 mba assignment july dec 2010 Question 5

5. Why do individuals resist change? Explain with suitable examples. Briefly discuss how resistance to change is managed in an organization you are familiar with. Briefly describe the organization you are referring to.

            It used to be an accepted fact that everyone resists change. We now know that it is not true. There are many reasons why a person resents (negative attitude) and/or resists (active opposition to) a particular change. Likewise, there are many reasons why a person accepts (neutral attitude) and/or welcomes (positive attitude) a particular change.

Why People Resent or Resist Change:

            There are many reasons why employees of  all sizes/ shapes may react negatively to change. Personal Loss. People are afraid they will lose something. They might be right or they might be wrong in their fear. Some of the things they might lose are as follows:

Security:

            They might lose their jobs through a reduction in force or elimination of their jobs. Automation and a decline in sales often bring about this feeling.

Money:

            They might lose money through a reduction in salary, pay, benefits, or overtime. Or, expenses such as travel may be increased because of a move to another location that is farther from their home.

Pride and satisfaction:

            They might end up with jobs that no longer require their abilities and skills.  

Friends and important contact:

            They might be moved to another location where they will no longer have contact with friends and important people. This loss of visibility and daily contacts is very serious for people who are ambitious as well as those with a strong need for love and acceptance.

Freedom:

            They might be put on a job under a boss who no longer gives them freedom to do it their way. "Closer supervision that provides less opportunity for decision making is a dramatic loss to some people.

Responsibility:

            Their jobs might be reduced to menial tasks without responsibility. This may occur when a new boss takes over or through changes in methods or equipment.

Authority:

            They might lose their position of power and authority over people. This frequently happens when re‑organization takes place or when a new boss decides to usurp some of the authority that an individual had.

Good working conditions:

            They might be moved from a large private office to a small one or to a desk in a work area with only a partition between people.

Status:

            Their job title, responsibility, or authority might be reduced from an important one to a lesser one with loss of status and recognition from others. This also happens when another layer of management is inserted between a subordinate and manager.

No Need:

            The typical reaction is, "What's the matter with the way things are now?" Or, "I don't see any reason why we should change. "More Harm Than Good. This is even stronger than the previously mentioned "No Need". People really feel it is a mistake ‑ that it will cause more problems that it is worth. Sometimes this reaction is justified. It is particularly common when people at the "bottom" of an organization feel that top management makes changes without knowing what is going on "down on the line."

Lack of Respect:

            When people have a lack of respect and/or negative attitude toward the person responsible for making the change, there is a strong tendency to resent and even resist it. Their feelings do not allow them to look at the change objectively.

Objectionable Manner:

            Sometimes change is ordered in such a way that the people resent and/or resist because they do not like being told what to do.

Negative Attitude:     

            People with a negative attitude toward the organization, the job and/or the boss are very apt to resent or resist change no matter what it is.

No Input:

            One of the most significant reasons is the fact that the people who felt they should have been asked were not asked for their ideas concerning the change.

Personal Criticism:

            Whether or not the change is actually criticizing the things that were previously done or the way in which they were done, people may look upon the change as a personal criticism.

Creates Burdens:

            Some changes add more work and with it confusion, mistakes and other negative results.

Requires Effort:

            The change will obviously require more effort. Much of the effort accomplishes very little, if anything. Whenever changes require more time and effort, people are apt to resent and even resist them, particularly if no rewards accompany the extra effort.

Bad Timing:

            The timing of a change is very important to its acceptance. If it comes at a time when people are already having problems, the change is usually resented and probably resisted by those who are supposed to implement it.

Challenge to Authority:

            Some people are testing their power and influence by simply refusing to do it.

Secondhand Information:

            Some people are very sensitive about the way they learned of the change. If they found out about if from a secondhand source, they might resist it until they hear it "from the horses mouth.

"What is the Real Reason for Resentment or Resistance?

            Managers often have difficulty in determining the real reason why subordinates resent and/or resist a change. They may feel that the subordinates are just being stubborn or that they are afraid they will lose something. The real reason may be entirely different.

WHY PEOPLE ACCEPTOR WELCOME CHANGE?

            While some people resent and/or resist change, others accept and welcome it. The degree to which these opposites occur depends on many factors. Some of the reasons for positive reaction to change are described in this section.

Personal Gain:

            When changes are made, some people may gain such things as the following:

Security:
            They feel more secure in their job because of the change. Perhaps more of their skills will be used.                             

Money:
            They may get a salary increase, more benefits, an incentive or profit‑sharing programme, or more overtime.                                

Authority:
            They may be promoted to a position of greater authority, or they may get a new boss who gives them more authority than they had under the previous boss.

Status and Prestige:

            They may get a new title, a new office, or a new responsibility, their boss may have assigned more responsibility, or they may have a new boss who assigns more responsibility than the previous one did.                

Better working conditions:

            They may get a new working schedule, new equipment, or other conditions that make the job easier or more enjoyable.               

Self‑satisfaction:

            They may get new satisfaction or feeling of achievement because of the change. Perhaps the new job gives them more of a change to use their abilities, or the boss may eliminate some of the obstacles that had prevented them from doing their best.

Better personal contacts:

            They might be located in a place where they will have closer contact with influential people. Their visibility is very important to some people

Less time and effort:

            The change may make their job easier and require less time and effort.

Provides a New Challenge:

            While some people look at a change negatively because it requires effort and perhaps risk, others will be eager for it because it provides a new challenge.

Likes/ Respects the Source:

            If people have a positive attitude toward the person or the department they represent, they will probably accept and even welcome the change.

Likes Manner:

            People who are asked to do things instead of told to do them may react very positively. Someone described the most important words in the English language as follows:

Five most important words: "I am proud of you”

Four most important words: "What is your opinion?"

Three most important words:"If you please."

Two most important words: "Thankyou."

One most important word:"You (or possibly We)."

The tone may have much to do with resentment or acceptance.

Reduces Boredom:

            Changes that are designed to reduce boredom will be welcomed by some.

Provides Input:

            One of the most powerful approaches to get acceptance is to ask for input before the final decision is made.                

Desires Change:

            Some people will react to change by thinking or saying, "It's about time." In other words, they have been anxious for the change to occur. 

Improves Future:

            Some changes will open up new avenues for future success in the organization. People will be provided with opportunities to show what they can do. Future possibilities include promotion, more money, more visibility, more recognition and more self­satisfaction.

Right Time:

            Some changes come at just the right time. If more money is needed to pay current bills or to buy a luxury item like a video recorder or a boat or to take a vacation, the change will be welcomed.

1. Explain the reason for change with facts. If there are risks, acknowledge them but explain why it is worth taking the risks.

2. Objectively explain the benefits that could result from the change.

3. Get ready and sell the benefits at all times.                                         

4. Anticipate objections.               

5. Listen in depth.                      

6. Seek questions and clarifications / answer them.

7. Invite participation and ask for suggestions.

8. Avoid surprise because this stirs up unreasoning opposition.

9. Acknowledge the rough spots and show you plan to manage them.

10.Establish a timetable.

11. Set standards and explain your expectations.

12. Contact the informal leaders and use their resources.

13. Acknowledge the staff cooperation / support.

14. Provide feedback on the progress.

15.Reinforce the positive.

16. Keep the two way communication open.

            Supervisors and managers who have enthusiasm for progress and change build a healthy climate. Creating the right climate is more than just passing on changes. It involves:
     a. Encouraging employees to seek ways of improving their jobs.

     b. Seeking suggestions and ideas from employees.

            This requires the manager/supervisor to listen and seriously consider suggestions. It is easy to see that there is a great deal of ego involvement in coming forth with an idea for improvement. Change can become an exciting and dynamic way of life. The manager/supervisor determines the climate in which they initiate change.

            Much of the difficulty in getting co‑operation stems from the employees lack of understanding of how the change will affect them. With a little effort, managers/supervisors can find most of the answers to employees' questions before they are even asked. Answers to these questions would be useful.

            What is the reason for the change? Whom will it benefit and how? Will it inconvenience anyone, if so, for how long? Will training or re‑training be necessary? When does it go into effect? Armed with the answers to these questions a manager/supervisor can head off many objections and can develop a plan to present the change.

IDENTIFY THE SOURCES OF HELP

            Why should you, the managers and supervisors, shoulder the burden alone? Staff can frequently be a great help in preparing to sell a change by explaining technical aspects and demonstrating new techniques.

            One of the most overlooked sources of help in introducing changes is the informal leaders in the work group. With their help the job becomes easier. Giving recognition to informal leaders puts them in a co‑operative frame of mind.

            Since union stewards are often informal leaders, their co‑operation ought to be solicited. The backing of union stewards makes the job easier.     

ANTICIPATE OBJECTIONS:

            Change that upsets routines, requires new knowledge or skills, or inconveniences people are bound to meet with some objections or resistance. Looking at a change from the employees point of view will usually be enough to help determine what their objections are likely to be. Knowing the objections, we can, with a little creative thought, turn these objections into advantages. Showing the staff with reason or logic will not do the job. Managers/supervisors have to convince people that the change is really best for them and that will not happen until their objections are dealt with seriously.
SELL BENEFITS:

            Everyone is concerned with, "What's in it for me?" "Will the change mean more satisfying work, greater security, opportunity to show what I can do, more responsibility, more pay, less fatigue, less confusion, and greater independence. "The benefits used to motivate people to co‑operate should be put on as personal a level as possible. It would be dishonest, however, not to recognise any disadvantages that a change may bring. These can usually be countered with long range benefits. One of the techniques that is helpful in identifying the characteristics and values of the proposed changed condition is a "Word Picture". The picture makes the new condition desirable in the minds of the staff.
A) One of the ways this concept of "word picture" is used is the physical change in office layout or new equipment or any other physical changes.

B) To picture or model a change in policy, organization or operation is more difficult than the physical change. The principle is the same. The picture can help in communicating the desirability of the change and in fine tuning the change because it makes it possible to discuss how things will operate. It may take the form of a flow chart, an organization chart or a description of relationships.To use this approach for deciding whether to initiate a change, you can take the following steps:
         a. Describe as clearly as possible the present situation.

         b. Describe as clearly as possible the desired situation.

            Analyse what specific changes will have to take place in the key factors involved to produce the desired situation. Look at such key factors as bosses, employees, equipment, physical environment, policies and procedures, work methods, materials and time. Identify the relevant factors.                                     

            Assess the strengths of the forces promoting the desired situation and of those resisting it. Determine what action to take..

Choices are:

A) Do nothing, the resistant forces are stronger than the forces promoting change.

B) Act to strengthen the promoting forces and/or to weaken resistance, by concentrating one's efforts on the key factors.                    

LISTEN IN DEPTH:

            Employees have a right to be heard. If employees are treated with respect, they probably will respond in kind. They will feel better too, if they know their concerns have been considered.                                                                         

FOLLOW‑UP
            After having conscientiously sold the benefits of a change, it is tremendously important that the managers/supervisors see that their promises have materialized. A sincere interest in how the change has affected the employee and a willingness to make adjustments, help build the climate in which future changes will be initiated.

Example :

Change is resisted everywhere let it be nay organization, let us take an example of  Satyam Computers, initially when the Mahindra Tech Took over the company the existing employees of Satyam where in very fear for their future related to their employment. Though there were complete changes at the top most level but the new management did not made much changes in the organization. Slowly the policies of new management were implemented after taking the employees in confidence and explaining the benefits and future prospects of new policies and also after implementation the feedback from the employees about the new changes made is a regular process. Now at present we could all see the smooth functioning of Mahindra Satyam Computers.

ms-25 mba assignment july dec 2010 Question 4

4. Explain the concept of organizational diagnosis. Describe any two methods of diagnosis and its benefits and limitations.

           

Solution: The organizational diagnosis is one of the key competencies of Human Resources and the knowledge of the organizational diagnosis is extremely important for the successful HR Business Partnering. The organizational diagnosis is extremely important as the organizations faces new challenges in the global world. The organizational diagnosis helps to identify the most robust organizational systems and organizational processes and recommends the improvements as the organization increases its capability to reach the strategic goals. Organizational Diagnosis is an effective ways of looking at an organization to determine gaps between current and desired performance and how it can achieve its goals. In recent years organizational diagnosis has evolved from a technique used as part of the organizational development process to a major technique in its own right. Effective diagnosis should be an organic process in that as you start to look at an organization and its structures and what it does and does not do, change starts, as change progress so does the 'now' performance and as such the diagnosis process also needs to re-start.

The BIR methodology looks at taking a 'snapshot' in time in a way which is quick and relatively unobtrusive. This allows decisions to me made, plans developed and actions implemented rapidly… Then using the benchmarking facility another snapshot of the organization can be made and new plans developed. A bit like the old story of "how do you eat an elephant? … one bite at a time. Developing an organization is no different. With each iteration of a diagnostic process so new changes are identified and prioritized. This not only keeps the development process alive – it makes it "the way we do business here". All too often in organizational diagnostics and development we focus on the 'new' and 'interesting' aspects of what we do. It is however vital that we periodically bring ourselves back to the basics…

The purpose of the organization is essentially a vehicle for producing profits for its owners. Or delivering valued services to its clients in not for profits. To meet the goals and get the best return on investment (ROI), the owners of a company employ managers who are responsible for setting performance objectives and reaching then through the appropriate use of a number of resources such as people, equipment, machinery etc.The purpose of a diagnosis is to identify problems facing the organization and to determine their causes so that management can plan solutions. An organizational diagnosis process is a powerful consciousness raising activity in its own right, its main usefulness lies in the action that it induces.

    * Orientation

    * Goal setting

    * Data gathering

    * Analysis/ Interpretation

    * Feedback

    * Action Planning

    * Implementation

    * Monitoring/ Measure

    * Evaluation

Method of organizational diagnosis

The focus of organizational diagnostics will be different in a range of situations, for example diagnosis for development or improvement will be different from diagnosis for remedial or problem solving, although the methodologies may be similar. While the diagnostic tools may well be similar, the application and outputs can be very different.

Kurt Lewin is said to have played a key role in the early development of organization development as we understand it today. As early as the 1940s, Lewin experimented with a change process which was collaborative in nature and involved himself as consultant and a client group.  The process was based on a three-step approach of planning, taking action, and measuring results. This was the beginning of what has become known as action research. This is a fundamental part of Organizational development. Later Lewin participated in the beginnings of laboratory training, or T-groups when after his death in 1947, his associates in the field continued to develop survey-research methods at the University of Michigan. These procedures became important parts of OD as developments in this field continued at the National Training Laboratories (US) and in growing numbers of universities and private consulting firms across the world.

The failure of off-site laboratory training to live up to its early promise was one of the important forces stimulating the development of OD. Laboratory training is learning from a person's "here and now" (Gestalt) experience as a member of an ongoing training group (T Group). Such groups usually meet without a specific agenda. Their purpose is for the members to learn about themselves from their spontaneous "here and now" responses to an ambiguous hypothetical situation. Problems of leadership, structure, status, communication, and self-serving behavior typically arise in such a group. The members have an opportunity to learn something about themselves and to practice such skills as listening, observing others, and functioning as effective group members.

Initially the approach was practiced in stranger groups, or groups composed of individuals from different organizations, situations, and backgrounds. Over time a major difficulty developed, however, in transferring knowledge gained from these stranger labs to the actual situation back home. This required a transfer between two different organizational cultures, the relatively safe and protected environment of the T-group (or training group) and the give-and-take of the organizational environment with its traditional values. This led the early pioneers in this type of learning to begin to apply it to family groups, that is groups located within an organization. From this shift in the locale of the training site and the realization that culture was an important factor in influencing group members (along with some other developments in the behavioral sciences) emerged the concept of organization development.

ms-25 mba assignment july dec 2010 Question 3

3. What is ‘Turnaround Management’? Describe how turnaround was used to bring change in an organization you are familiar with. Briefly describe the organization you are referring to..

TURNAROUND MANAGEMENT
            It is a process of devising, executing and managing a plan of corporate renewal. The process involves identifying the key drivers of an unstable business and implementing a sustainable recovery change strategies which rapidly improves the business. The Turnaround management involves a number of steps:

STEP 1:

INDENTIFY THE ROOT CAUSES.

·         Sales down due to weak economy.

·         Overly optimistic sales projections

·         Poor strategic choices     

·         High operating costs            

·         High fixed costs that decrease flexibility            

·         Insufficient resources                                                                  

·         Unsuccessful R&D projects                                             

·         High successful competitor                                                                              

·         Excessive debt burden

·         Inadequate financial controls.

STEP 2

            Conduct a situation   audit / analysis.

STEP 3

            Develop a strategic corporate objective.

STEP4

            Develop a   corporate   strategy

STEP 5

            Develop a corporate business restructuring plan.

Strategic restructuring:

            The focus lies on core markets and promising business segments. Corporate divisions destroying value are divested. Operational restructuring: It focuses on leaner organization and leaner processes, on the simplification of manufacturing networks and corporate structures, as well as on maximizing efficiency and effectiveness.
Financial restructuring: A combination of cost reduction, more flexible structures, and the development of a sustainable financial concept.

STEP 6

            Develop a change management program.

STEP 7

            Develop   an emergency action plan.

STEP 8

            Develop an implementation   plan.

THINGS TO REMEMBER:

            The overall financial situation is as transparent as possible and that the influence of the identified restructuring measures becomes clear, rapid analysis and concept development considering the information needs of the stakeholders are conducted, the most relevant people from the  organization are involved in order to achieve acceptance for the implementation of improvements, consistent project management and controlling are established during the implementation phase to ensure that the pursued improvements are actually achieved, all stakeholders are continuously informed and involved in order to identify risks and avoid counterproductive conflicts.

TURNAROUND MANAGEMENT – EXAMPLE

            The organization I am referring to, was facing a problem of declining sales / market share for 2 consecutive year. The organization, I am familiar with is a large manufacturer / marketer of safety products - the products  are  used  as  [personal protection safety] [industrial safety]  -the products are distributed through the distributors as well as sold directly - the  products  are  sold  to various  industries like  mining /

Fireservices/defence.                                                                                                         
Marketing
Manufacturing
Sales
Finance/administration
Humanresource
Customer service
Distribution

Warehousing/ Transportation
TQM

STEP1.

            INDENTIFY   THE  ROOT  CAUSES.
      a.Poor strategic choices
     b.High operating costs
     c.Insufficient resources

     d.High successful competitor
     e.Inadequate financial controls.

STEP 2

            Conduct   a   situation   audit / analysis.

·         the demand for the market was growing at 13%

·         the company sales was growing at 7%                          

·         the company was selling directly to the customers, using the sales force.                    

·         lack of adequate product range.                                               

·         lack of market coverage                                       

·         lack of skills among the sales force-demand for  technical  products
etc

STEP 3

            Develop a strategic corporate objective.
Go for 20% growth ---- per annum over the next 5 years. Enter new market segments. [15%additionalsalesvolume]offer newproduct[15%  additional   sales  volume ]

STEP4

            Develop a corporate  strategy

·         Restructure the marketing department [3 product group management]

·         To achieve 80% sales through distributors in 5  years  time.                

·         To conduct more marketing development for new products.

·         To train all staff in the product knowledge etc.

STEP 5

           Develop   a   corporate   business restructuring plan
Strategic restructuring:

            The focus lies on core markets and promising business segments. Corporate divisions destroying value are divested.                  

·         3 new product groups.        

·         Development of a new sales department to develop distributor sales.

Operational restructuring:

            It focuses on leaner organization and leaner processes, on the simplification of manufacturing networks and corporate structures, as well as on maximizing efficiency and effectiveness.

Financial restructuring:

            A combination of cost reduction, more flexible structures, and the development of a sustainable financial concept.                     

·         Reorganizing the sales territories.

·         Appointment of new distribtors-- geographically.

·         Payforperformancesystems.

STEP 6

           Develop  a change management program.

Implementation of the change management program over  the  6 months  period.

STEP 7

          Develop an emergency action plan, which included:

·         new product sourcing.                                          

·         new product development                                            

·         new sales policies development                                    

·         new distributors policies development                             

·         new training for sales force

·         to manage the distributors.

·         new training for customer service staff.-new order processing/ servicing systemetc

STEP 8

DEVELOPAN IMPLEMENTATION PLAN.
A  PHASED PROGRAM OF  IMPLEMENTATION.

These above mentioned steps helps lot in turnaround process