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Change Management-in Bega Cheese

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Question:

Discuss about the Change Management Implemented in Bega Cheese.
 
 

Answer:

Introduction

In the present business scenario, adjusting with the rapid change in the market is posing a huge challenge for the business organizations. Moreover, there are various types of threats such as counterfeiting which is adversely affecting the business revenue of the organizations. Thus, to counter all these issues, contemporary business organizations came up with the idea of change management. Change management is the concept of implementing various strategies in the organizations which helps to adjust with the originated issue (Hayes 2014). Organizations have to come up with various change management policies in different time to counter the identified issues. Bega cheese is an Australian dairy products manufacturer which is one of the leading players in the dairy sector (Bega Cheese 2017). In the recent times, they also faced some organizational issues, based on which they are implementing change management in their organization.

This report will discuss about the change management being implemented in Bega cheese and with their implications. Various aspects of the implemented change management policies will also be discussed using different theoretical models. Recommendations will also be given according to the findings which will help to further effective implementation of the change management.

Analysis of external environment

External environment of Bega cheese will be analyzed with the help of PEST analysis. It will help to determine the issues or gaps which can be countered with the implementation of change management. It will help to determine the external forces of change management for Bega cheese.

PEST analysis

Political: Bega cheese mainly operates in the Australian market which is a politically stable country. However, the higher tax rate for the cheese posing a challenge for them in regulating the cost. Taxation rate will also have an adverse affect in the production of the cheese and other dairy items (Auerbach and Gorodnichenko 2012).

Economic: The inflation rate in Australia is on the lower side and this is an opportunity for them to increase their sales chart. However, they are facing issues from the Chinese counterfeited products which are eating way their market share (Degardin, Roggo and Margot 2014). Moreover, the counterfeited products also lack nutritional value as the originals.

 


Social: People are becoming more health conscious and it is a huge opportunity for the dairy products to increase the market sales (Regulations 2013). However, in the case of Bega cheese, the counterfeited products in the market are having negative impact on the perception of the consumers.

Technology: Bega cheese involves the most advanced technologies in their production process. However, newer and secured technologies are required in filtering out the counterfeited products. The container tins should be designed in such a way that is will be difficult for the counterfeiters to copy (Robertson 2016).

Thus, from the above analysis, it is being found that counterfeiting is one of the key issues that they are facing currently. They should have to implement a change management policy to prevent this identified issue. Another issue that can be identified from the external analysis is the associated risk with their single line of products. It is been seen that higher rate of taxation is already affecting their sales of cheese. Thus, change management should be implemented for this issue also.

Diagnosis of the organizational behavior

To analyze the organizational behavior of Bega cheese, McKinsey’s 7s model and Kotter’s integrative model of organizational dynamics will be used (Singh 2013). These models will help to determine the strategy, organizational structure, systems and other related aspects of Bega cheese.

Kotter’s integrative model of organizational dynamics

External environment: As discussed earlier, external environment for Bega cheese is more or less favorable for their operations in the Australian market (Chatterjee, Sherwin and Jain 2013). Moreover, the implementation of the newer technologies to counter the counterfeited products will help to have positive impact on their business.

Employees: Staffing in Bega cheese is being done according to the requirement (Kerzner 2013). In the case of implementing new coding process, employees are being selected according to the skill required in the project. Financial and technological asset or infrastructure of Bega cheese is well enough to withstand with the uncertainties in the change management.

Formal structure: Organizational structure of Bega cheese is quite favorable and engaging for the employees. The job of the respective employees is being designed according to their skills and qualification (Wood 2012). This help them in increasing the level of the productivity of the employees and they are more motivated with their respective job roles.

Social system: The external organizational culture is favorable except the fact that more customers are having negative impression due to the presence of the counterfeited products. On the other hand, the internal organizational culture is much participative and engaging. Effective communication channel are being maintained in their internal organizational culture (Kasper and Kelleman 2014).

Objectives and strategies: The strategy implemented in the organizational process of Bega cheese is being well aligned with their objectives. The main objective of Bega cheese is to provide the various dairy products especially the cheese in different forms and different utilities (Regulations, 2013). Being the market and industry leader in this sector is also one of the key objectives of them. Currently the change management strategies they have initiated to implement in their organization to counter the identified issues.

McKinsey’s 7s model

Strategy: The key competitive advantage for Bega cheese is their heritage which is being easily recognizable to majority of the consumers. Moreover, the market establishment and brand identity that they have gathered are being used consciously in driving the sales (Da Silveira, Lages and Simoes 2013). To take over the competition and meeting the varied customer needs, they introduce their products in different prices and sizes which is more convenient for the consumers. Thus, in the case of diversification, this strategy will comes handy in entering in new sectors with having more diversified product portfolio.

Structure: The organizational structure of Bega cheese is being designed in most sustainable manner (Ashkenas et al. 2015). They constitute of board of directors of total nine directors. Independent director is also there in maintaining the transparency. The key departments are being divided in marketing, operations, human resources and production. All the departments are having responsible department heads under which the subordinates are working.

Systems: Organizational systems of Bega cheese is much employee concentrated. To take care of the issue of the employees, they have initiated an employee feedback mechanism to gather the opinion from the employees (Asumeng 2013). According to the suggestions being gathered from the employees, necessary initiatives are being implemented. This helps in maintaining the effective working environment in the organization which eventually helps in enhancing the satisfaction level of the employees.

Shared values: The organizational principles of Bega Cheese stand on fairness, transparency and honesty. Their core values cover all the stakeholders in the organization. The products being provided to the customers are also based on these principles. Moreover, the leadership roles in the organization play an important role in maintaining the organizational culture.

Styles: Leadership role in Bega cheese is the main reason behind the high engagement level of the employees (Asumeng 2013). The top brass in the board of directors are being accessible to all the employees in case of any issue. Thus, the leadership styles in their internal management are much participative in nature. The core values and principles are being transmitted from the upper level management. Team work is also being given much importance in the organizational practice of Bega cheese. Environment for healthy competition are there in the organization which helps in increasing the productivity of the employees.

Staff: Staffing process in Bega cheese is diversified and on the basis of merit of the employees (Kerzner 2013). They represents diversified work force in the organization. However, as they are now entering in different sectors for elderly and diabetic people, there is a need or requirement for new employees who will have experience in determining the requirement of these sectors.

 


Skills: As earlier discussed, Bega cheese comprise of employees having different background and skills. Being a huge organization, Bega cheese requires employees for their sales, marketing, operation, manufacturing and quality control. Thus, various and diversified skills are being represented in the internal organization (Rosenberg, Heimler and Morote 2012). Currently, they are known for manufacturing cheese having higher nutritional values and offering them in various sizes. The existing employees in the organization are doing their job effectively, but with the entry in the new sectors, it is of great need that more employees having experience in other sectors should be inducted. Performance appraisal is being promoted by the management in order to monitor the performance of the employees and implementing suitable change accordingly.

Interventions

The study discusses the change management system of Bega Cheese, which is a dairy firm, operating in Australian Supermarket. The emerging competition in Australian market is quite challenging for the retail sectors (Cameron and Green 2015). It is notable that the company previously was concentrating on producing the dairy products for the children. Currently, the company is focusing on extending the target customer base by producing the dairy products for the elderly people as well. Currently, the Australian citizens have been looking forward to consume the healthier foods that can be helpful in reducing the diabetes or other similar health issues. The company is thus majorly focusing on producing such dairy products that can be useful for these people in reducing their diabetic tendency. On the other hand, the second change is implemented to increase the security parameter. The container provided for the baby food is sometimes unable to detect the original product. The intervention related to such change system will be analyzed by defining the relevant typologies in the further section of the study.

 Intervention 1: Product Diversification Strategy

Product diversification is the part of the change management system that helps an organisation to strengthen the competitive edge. Bega Cheese has undertaken the product diversification strategy to extend the target customer base by introducing various products. This product diversification strategy falls under the typology 2 of intervention process. The second typology of intervention is mainly focusing on the development of the interpersonal relationships by establishing the communication transparency (Michie, Atkins and West 2014). Maintaining coordination with the existing employees would be much helpful in structuring the operational functions during the change management process. The intervention typology 2 is also concerned with the strategic formulation and implementation aspects by considering the people management practices. The human resource management of Bega Cheese needs to re-organize the management process to arrange the work activities and schedule the business operations for implementing change (Hornstein 2015). It is necessary to provide the proper training and development to the workforce who is involved in product manufacturing process. Moreover, the sales and executive team of Bega Cheese needs to gather the sufficient knowledge regarding the specifications of the new products. It will be fruitful for the company to approach the target customers by resolving their queries related to product concerns. It has been observed that the elderly people often suffer from diabetes if they do not maintain the proper diet. Especially while consuming the dairy products; it is necessary for them to maintain the sugar level for preventing the tendency of diabetes mellitus. Hence, introducing the product variations for targeting such customers would be much beneficial for the company to extend the customer base.

It is to be indicated that the strategic issues can influence the change management system in a recognizable way. The involvement of the strategic planning by the human resource management would be much helpful in mitigating the risks associated with the change management system (Matos Marques Simoes and Esposito 2014). It is important to mention that the company needs to consider the expectation level of the target customers while bringing changes on the product varieties. Accordingly, it will be beneficial in understanding the systematic approaches to structure the organisational functionalities as per the change initiatives.

Intervention 2: Mitigating the risks with the counterfeited products

It has been observed that the containers of the food products are at times imitated by the Chinese manufactures. Therefore, while the customers are purchasing the products from the market, they are unable to identify the original products. Eventually, they face the issues with the quality of the products delivered by the company.  After recognizing such issues, the company has undertaken the initiative to apply the new coding system for creating the unique form of containers, which will be easily identified in terms of authenticity (Lines et al. 2015). The unique coding system would be available to identify the originality of the products. Hence, the quality would not be compromised and the original purpose will be served to the potential customers. The initiative is quite effective for the company to prevent the fraudulent activities and provide high quality products to the potential customers.

 


This initiative of implementing the unique coding system falls under the intervention typology 1. As per the specification of the typology 1, the scientific principles are needed to be applied to resolve the specific problems. In time of product packaging, it is necessary to identify the proper coding system that cannot be imitated by the Chinese manufactures. The specific coding system would help in preparing such unique technicality to maintain the originality and mitigating the risks with the low quality products (Lin and Wu 2014). Another specification of this typology is the team collaboration to achieve the goals. If the workforce is involved in accomplishing a similar purpose, the changes will be much effective for the company. Furthermore, this typology specifies that the experts need to be involved in order to resolve the concerns related to the respective problems. The company can involve the technological engineer to help in the coding system to prevent the counterfeited products. The involvement of the experts will be effective enough in resolving the system-wide problems as a whole (Wilson and Sullivan 2016).

In addition to this, the human resource management needs to pay the extensive attention towards the team coordination in resolving the problems with the quality parameter. If the team members can work cohesively for a similar purpose, it will be easier for the team to maintain the proper coordination. The maintenance of the quality parameter is one kind of assurance for the brand identity (DiMase et al. 2016). The effective quality and the unique code in packaging process will ensure the brand identity of the product or service. The management of Bega Cheese thus needs to focus on such concerns in order to mitigate the issues. This initiative would help in preventing the Chinese manufacturer to produce the duplicate tin container that contains the low quality dairy product. The maintenance of the sequential steps and functions would be ensured to implement the change management system under such typology of intervention.

Recommendations

Intervention: 1

  • Diversification as strategy helps in dividing the business portfolio in various sectors with catering to more number of customers (Johnson 2017). However, for effective implementation of the diversification strategy, the key aspect that needs to be considered is the holistic analysis of the sectors where they are entering. This is due to the reason that without having proper knowledge about the trend of the business in those sectors, it will be a risk factor for Bega cheese to enter. Moreover, another aspect that also needs to be looked after is the recruiting and selecting the employees who will be suitable to work and have experience in the new sectors.
  • The implementation process of the diversification strategy should be well communicated to all stakeholders who are having interest in the change management (Kasper and Kellerman 2014). It will help in more effective implementation for the project. All the employees should understand the need and requirement of the change being implemented. It will help to increase the effectiveness of the project as because the employees will have the clear idea about the project and thus they can accomplish their job accordingly. In addition, the change management should involve right and suitable change agents according to the requirement for effective implementation. Agents for the change management should be selected according to the required skills.
  • Change management will only be a successful venture if they are sustainable enough to withstand the business challenges. To enhance the sustainability of the implemented change, employees and change agents should be given time. It is due to the fact that, it takes time for the overall implementation of the change in the organization. Thus, short term planning regarding the change management will hamper the effectiveness of the project.
  • Continuous process of evaluating the implemented change in the organization will help to identify the issue being generated and overcome it accordingly. Feedback mechanism should be initiated among the change agents to gather information regarding the effectiveness of the change.
 

Intervention: 2

  • Initiating the new coding process to create unique formula tins will help to distinguish it from the counterfeited products. However, one aspect that needs to be considered is periodic change in the coding process. It is due to the reason that counterfeiters will be able to counterfeit the newly implemented coding process if it is being continued for a long process. Thus, the coding process should be changed with every certain time period. Moreover, if it is been seen that the newly implemented coding process is proving ineffective then the coding process should be entirely changed and new safety features other than the coding should be implemented.
  • Coding features should be implemented according to the latest and most secured technologies which will be difficult to imitate. Moreover, implementation of coding system involves specialized personnel. Thus, selection of the agents should be done accordingly. Implementation of the coding system should be first conducted on a particular line of product. It will act as a pilot project. Based on the effectiveness of the pilot project, the overall implementation of the coding system should be done. It will reduce the associated risk with the change management.
  • The sustainability of the coding process is entirely depends on its immunity towards imitation. Thus, to enhance the sustainability of the change management, the coding system should be full proof and be modified with every certain time period.

Conclusion

Having analyzed the various aspects of the change management being implemented in the internal organization of Bega cheese, it can be concluded that they have effectively initiated the change strategies. The main issues being identified is the counterfeiting of their products and more concentration on a single product line. Accordingly they have implemented diversification and new coding process to counter these issues. Different models are being used to determine the organizational structure and policies of Bega cheese. Necessary recommendations are being given to further enhance the effectiveness of the change being implemented.

 

References

Ashkenas, R., Ulrich, D., Jick, T. and Kerr, S., 2015. The boundaryless organization: Breaking the chains of organizational structure. John Wiley & Sons.

Asumeng, M., 2013. The effect of employee feedback-seeking on job performance: An empirical study. International Journal of Management, 30(1), p.373.

Auerbach, A.J. and Gorodnichenko, Y., 2012. Measuring the output responses to fiscal policy. American Economic Journal: Economic Policy, 4(2), pp.1-27.

Bega Cheese. (2017). Home - Bega Cheese. [online] Available at: https://www.begacheese.com.au/ [Accessed 30 Jul. 2017].

Cameron, E. and Green, M., 2015. Making sense of change management: A complete guide to the models, tools and techniques of organizational change. Kogan Page Publishers.

Chatterjee, K., Sherwin, H. and Jain, J., 2013. Triggers for changes in cycling: the role of life events and modifications to the external environment. Journal of Transport Geography, 30, pp.183-193.

Da Silveira, C., Lages, C. and Simões, C., 2013. Reconceptualizing brand identity in a dynamic environment. Journal of Business Research, 66(1), pp.28-36.

Dégardin, K., Roggo, Y. and Margot, P., 2014. Understanding and fighting the medicine counterfeit market. Journal of pharmaceutical and biomedical analysis, 87, pp.167-175.

DiMase, D., Collier, Z.A., Carlson, J., Gray, R.B. and Linkov, I., 2016. Traceability and risk analysis strategies for addressing counterfeit electronics in supply chains for complex systems. Risk Analysis, 36(10), pp.1834-1843.

Hayes, J., 2014. The theory and practice of change management. Palgrave Macmillan.

Hornstein, H.A., 2015. The integration of project management and organizational change management is now a necessity. International Journal of Project Management, 33(2), pp.291-298.

Johnson, G., 2017. Exploring strategy: text and cases. Pearson.

Kasper, G. and Kellerman, E., 2014. Communication strategies: Psycholinguistic and sociolinguistic perspectives. Routledge.

Kerzner, H., 2013. Project management: a systems approach to planning, scheduling, and controlling. John Wiley & Sons.

Lin, Y. and Wu, L.Y., 2014. Exploring the role of dynamic capabilities in firm performance under the resource-based view framework. Journal of business research, 67(3), pp.407-413.

Lines, B.C., Sullivan, K.T., Smithwick, J.B. and Mischung, J., 2015. Overcoming resistance to change in engineering and construction: Change management factors for owner organizations. International Journal of Project Management, 33(5), pp.1170-1179.

Matos Marques Simoes, P. and Esposito, M., 2014. Improving change management: How communication nature influences resistance to change. Journal of Management Development, 33(4), pp.324-341.

Michie, S., Atkins, L. and West, R., 2014. The behaviour change wheel: a guide to designing interventions. Needed: physician leaders, 26.

Regulations, P., 2013. Australian Dairy Industry.

Robertson, G.L., 2016. Food packaging: principles and practice. CRC press.

Rosenberg, S., Heimler, R. and Morote, E.S., 2012. Basic employability skills: a triangular design approach. Education+ Training, 54(1), pp.7-20.

Singh, A., 2013. A study of role of McKinsey's 7S framework in achieving organizational excellence. Organization Development Journal, 31(3), p.39.

Wilson, J.M. and Sullivan, B.A., 2016. Brand owner approaches to assessing the risk of product counterfeiting. Journal of Brand Management, 23(3), pp.327-344.

Wood, S., Van Veldhoven, M., Croon, M. and de Menezes, L.M., 2012. Enriched job design, high involvement management and organizational performance: The mediating roles of job satisfaction and well-being. Human relations, 65(4), pp.419-445.

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