Organizational change refers to the changes in management and business processes of an organization. Organizational changes are necessary from time to time in order to remain ahead of the competitors and to survive in the long- run. There are several difficulties associated with changes such as resistance from employees (Benn, Dunphy & Griffiths, 2014). However, embracing changes is essential for the growth and development of an organization. Successful companies know the importance of organizational change in achieving competitive advantage. It involves understanding the needs and wants of the customers and developing products and services accordingly (Cameron & Green, 2015). It involves ensuring that the quality of products and services meet the expectations of the customers. The report explains the organizational change in Z Energy Limited.
Z Energy Limited is a New Zealand based company, which acts as a fuel distributor. The organization has its own branded service stations. It is a dual listed public company and a successor of Shell New Zealand Limited and Greenstone Energy Limited. The organization was founded in the year 1911 as Shell New Zealand Limited in Auckland. The organization is located in more than 305 locations in New Zealand and Australia. The company mainly deals in diesel, petrol and oil. The organization provides employment to more than 2500 individuals. The company supplies fuel to several large commercial and retail customers such as airlines, mines, trucking companies and several others. The organization is also involved in providing bitumen to the roading contractors ("Quality fuels, Forecourt service, Nationwide petrol station and truckstop network, Fresh food and great coffee - Z is for New Zealand | Z", 2017)
The senior management team of the organization comprises of Chief Executive Officer, Chief Financial Officer, General counsel, General manager corporate, General manager supply and distribution, General manager retail, General manager commercial, General manager HSSE (Health, Safety, Security and Environment), General manager people and culture and General manager marketing. The organization has its board of members, which comprises of seven people namely Peter Ward Griffiths, Alan Michael Dunn, Paul Fowler, Marko Bogoievski, Dr. Bruce Harker, Abby Foote and Justine Munro ("Quality fuels, Forecourt service, Nationwide petrol station and truckstop network, Fresh food and great coffee - Z is for New Zealand | Z", 2017).
Z Energy Limited is a New Zealand based company, which acts as a fuel distributor. The organization has its own branded service stations. The company mainly deals in diesel, petrol and oil. The company supplies fuel to several large commercial and retail customers such as airlines, mines, trucking companies and several others. The organization is also involved in providing bitumen to the roading contractors. For motorists, the Company offers fuels, such as ZX Premium Unleaded, Z91 Unleaded, Z Bio D Biodiesel and Z Diesel. The organization is located in more than 305 locations in New Zealand and Australia ("Quality fuels, Forecourt service, Nationwide petrol station and truckstop network, Fresh food and great coffee - Z is for New Zealand | Z", 2017). The Company also supplies bulk fuel to trucking companies, airlines, transport firms, construction companies, power generators, farmers, loggers and mining operations. The Company also supplies bitumen to roading companies.
The goal of the organization is to represent the capabilities of New Zealanders to put their minds to the things that matter such as putting service into service stations, supporting local neighbors, fueling New Zealand to grow further and rewarding the investors for their trust in the company ("Quality fuels, Forecourt service, Nationwide petrol station and truckstop network, Fresh food and great coffee - Z is for New Zealand | Z", 2017). The organization aims to bring out purpose to life for their customers, shareholders and stakeholders. The purpose refers to what guides everything the organization does that is to “solve what matters to for a moving world”.
The vision of the company is to become a globally recognized Kiwi company and become a role model for other organizations.
Political factors: Political factors play an important role in the survival and profitability of an organization. Z Energy deals in diesel, petrol and oil in several countries and has to deal with the political environment and the several risks involved in the political systems across the nations. In order to ensure profitability in the energy industry across the nations, it is necessary to diversify the potential political risks. There are several factors that are required to be analyzed while conducting business overseas. The factors involve political stability in the other nations, corruption levels, legal framework, trade regulations, anti- trust laws, pricing regulations, wage legislation, taxation policies, industrial safety regulations, interference level of the government in energy industry (Zalengera et al., 2014).
Economical factors: The economic conditions of the countries affect the business functions of Z Energy. Several factors such as inflation rate, interest rates, foreign exchange rate, savings rate and the economic cycle of the nations determine the demand of the products of Z Energy. Several other factors that determine the demand of the products of Z Energy involve the level of competition within the country. The organization can study the information related to the inflation rate, growth rate, tastes and preferences of the customers, etc in order to forecast the demand and profitability. The economic factors to be considered involve kind of economic system, type of market, exchange rates, quality of infrastructure, condition of the financial markets, comparative advantages, workforce skills, education level, labor costs, business cycle stage, economic growth rate, unemployment rate, discretionary income, interest rate, inflation rate and several other factors (Makos, 2015).
Social factors: The culture of a society highly influences the success or failure of an organization. The attitude and belief of the people play a vital role in determining the marketing and sales strategies. It is necessary to understand the buying patterns of the customers in the target market in order to determine the scope of success or failure of a business. Therefore, it is necessary to study the demographics of an area, the education level of the population, class structure in the society, culture, entrepreneurial spirit, attitudes and leisure interest of the target population (Team, 2013).
Technological factors: There have been rapid changes in the technologies all over the world. The transportation industry has witnessed several technological advancements in the past few years. The number of vehicles has also increased over the past few years. The taxi industry has also gone through a massive revolution with the introduction of several companies such as Uber. Automation has changed the outlook of the car industry (Petrou, Demerouti & Schaufeli, 2016). Therefore, Z Energy is required to study the technological changes of the rivals, the impacts of technological changes on the products offered, impact of cost structure and value chain structure in the Energy industry and the level of technological diffusion.
Legal factors: The legal structures differ from one country to another. Therefore, the organizations are required to study the legal structures of the countries in which they operate. Z Energy must also analyze the legal framework and the legal institutions in the countries in which it operates. Some of the legal factors to be considered involves discrimination law, consumer protection law, data protection law, health and safety law, employment law, intellectual property law and anti- trust law prevalent in the energy industries across the nations (Anderson, 2016).
Environmental factors: The several environmental factors that affect Z Energy involve weather, climate change, air and water pollution, waste management systems, endangered species, etc. The business activities of Z Energy highly affects the environment, therefore; the organization is required to study the impact of the business activities of the organization on the environment (Nacamulli, Sheldon & Della Torre, 2017).
The data collection process involves primary data collection method and secondary data collection method. In this case, both primary data collection technique and secondary data collection techniques would be appropriate to identify the areas in which organizational changes are required within the firm to improve its efficiency. In case of primary data collection, the employees of the organization shall be interviewed in order to know the type of organizational changes that are necessary for the further development of the organization (Orkin, 2014). The organizational change might be related to personnel change, technological change or remedial changes. For this purpose, the organizational members shall be interviewed and the results obtained from the data collected shall be analyzed to take further actions. The organization comprises of more than 2500 employees and a random sample population of 500 employees shall be interviewed in order to derive conclusions for the entire population. In case of secondary data collection, the market trends in the fuel and energy shall be analyzed in order to find out the necessary changes that are required. The strategies utilized by the competing firms shall also be analyzed in order to find out suitable organizational changes and strategies that shall help the organization to remain ahead of the competitors (Best & Kahn, 2016).
The research findings indicate the necessity of reorganization the personnel within the organization in order to improve the efficiency of the organization and remain ahead of the competitors. The organizational change shall require personal development, ergonomic work place and improving the level of job satisfaction among the employees (Matthews & Ross, 2014). The organization is required to undergo massive hiring and layoffs in order to ensure that the best employees remain within the organization.
The organizations operate in close relation to the society and involve social factors that are required to be considered. Organizational change management is highly dependent upon the social factors such as demographics and social mobility, lifestyle patterns and changes, attitudes and actions of people, perception and influence of media and ethnic and religious differences (Haslam et al., 2014).
The biological perspective of managing change considers that the perceptions of the individuals differ from each other. The perception of an individual changes as it grows to an adult and matures until he dies (Colquitt et al., 2013). For example, the perceptions of the employees of Z Energy Limited might change from time to time. In such a case, it becomes necessary to consider the opinions of the organizational members in order to ensure successful change management.
Systems perspective states that even a small change within an organization might have several impacts on the organization and its members. For example, there are several subsystems in a human body such as respiratory system and muscular system in the similar manner, there are several sub systems within an organization, which are inter related to each other. Any change in one system shall affect the other systems (Wooten & Hoffman, 2016). Therefore, it is necessary to consider the impacts of the changes on all the related systems.
The rational perspective is within the power of the managers to influence as they possess appropriate authorities and adequate resources that helps in achieving the organizational objectives (Dawson & Andriopoulos, 2014). For example, suggestions and opinions from the managers in Z Energy Limited must be taken in to consideration before deciding the change and implementing it within the organization.
Change is an important part of every organization (both small and large organizations). In the fast changing world, it becomes necessary for the organizations to adapt and implement the necessary changes in order to remain ahead of the competitors and survive in the long- run. The organizations that manage changes efficiently have more chances of becoming successful. The process in which organizations manage change differs in terms of nature of business, the change involved and the people involved. The Lewin’s change model comprises of three stages namely unfreeze, change and freeze. The first stage is unfreezing. In this stage, the organization gets ready for the change (Cummings, Bridgman & Brown, 2016). This involves understanding the fact that the change is necessary for the betterment of the organization and getting prepared for moving out of one’s present comfort zone. The more the organization feels that the change is necessary, the more it is motivated to implement the required changes. The second stage involves change or transition. In this stage, the organization actually implements the changes. This stage is often referred to as the most difficult stage (Burnes, 2017). There are high chances of resistance to changes as it is difficult for the people associated with an organization to accept the changes. The last stage involves freezing. In this stage, the organization aims at establishing stability after the necessary changes have been implemented. The changes are accepted by the organizational people and they start feeling comfortable with their present routines (Bartunek & Woodman, 2015).
Kotter trusted that it is basic to experience a few stages keeping in mind the end goal to effectively actualize changes inside an association. The initial step includes making a feeling of urgency. As indicated by him, for a change to be effective, more than 75 percent of the members of the organization must feel the need and criticalness of the change. The change must be actualized when it is distinguished as any postponement in executing change may prompt misfortunes and wastefulness of the associations (Calegari, Sibley & Turner, 2015). The second step includes making a directing coalition. This progression specifies that it is important to include the authoritative individuals keeping in mind the end goal to effectively actualize the change on the grounds that the senior administration and officials cannot be the only ones who execute the change. The senior experts are required to control the representatives of the association and help them to adjust with the progressions. The third step includes building up a dream and technique. It is important to build up an appropriate system and vision. The change administrator is in charge of creating proper methodologies that will direct the change procedure. They are required to include all the key partners in the change administration process (Pollack & Pollack, 2015).
The fourth step is passing on the change vision. It is exceptionally important to impart the progressions that are to be actualized inside an association that might influence the key partners. Change cannot be actualized effectively by insignificant arranging the change rather, it is important to pass on the progressions to the related partners so they can set themselves up for the progressions to be executed inside the association. The fifth step includes engaging representatives. In this progression, the change isn't just passed on to the related partners yet in addition they are permitted to concoct their contemplations, fears and thoughts in regards to the change. It is fundamental to include the general population who should be influenced because of the progressions so that there is no protection and the change is actualized with no obstacles.
The 6th step includes producing temporary wins. Keeping up force is basic for the effective usage of progress. Short- term wins is one of the techniques that assistance in the fruitful usage of changes by making early progress. The seventh step includes merging gains. In this progression the fleeting wins should positively affect the related individuals and they might be urged to additionally actualize the adjustment keeping in mind the end goal to get long haul picks up (Issah & Zimmerman, 2016). The eighth step includes mooring new methodologies in the way of life. The associations must be continually engaged with growing new methodologies that assistance in the hierarchical advancement in light of the fact that the methodologies, which have been effective in the past might not be fruitful later on. Along these lines, the associations must be inventive and creative and thought of another approach when the past methodologies appear to be of no utilization.
The 'hard' components of change are the undertakings inside change management, which are characterized and measured. “Soft’ elements, for example, culture and inspiration might be harder to evaluate. Accentuation might be set after overseeing undertaking factors to the detriment of delicate components amid change intercessions; nonetheless, Farkas (2016) contended that four hard factors correspond to the result of progress mediations, to be specific: term (time span); honesty (dependence on administrators); duty (of all associated with change); and exertion (inside the chance of time permitted). While portraying change, organizations are required to consider the speed and size of progress, and relate this to the issue of multifaceted nature. The issues that change present to an association can be seen by supervisors as 'challenges', which are 'limited' in that they can be very much characterized (determined) and can be managed without including or affecting on the more extensive association. Another classification of issues are those which can't be all around characterized and are 'unbounded' as in the more extensive association is embroiled and should be engaged with managing these sorts of issues. In the case of Z Energy Limited, the change is soft change as it involves change in the human resource management.
Total quality management (TQM) refers to the organizational effort that is developed to enhance the quality of products or services provided by the organizations. In the highly competitive environment, the organizations are required to pay more attention towards the quality of its products and services (Mitra, 2016). Several organizations nowadays hire external consultants and initiate several quality training workshops for their employees. Successful companies know the importance of total quality management in achieving competitive advantage. Total quality management involves giving preference to the needs and wants of the customers and developing products and services accordingly (Goetsch & Davis, 2014). It involves ensuring that the quality of products and services meet the expectations of the customers. In case of total quality management, the initial objective of the organizations is to identify and meet the expectations of the customers. According to Total quality management, a product is of no worth if it is unable to satisfy the expectations of the customers (Dale, 2015). Another aspect of total quality management is that it focuses upon continuous improvement.
High performance work organization refers to the organizations, which have greater involvement of the organizational employees in the decision- making process. The high performance work organizations provide greater control to the organizational employees over their reward structure, which results in greater efficiency and motivation among the employees (Gimenez- Espin, Jiménez- Jiménez & Martínez- Costa, 2013). The high performance work organizations aim at increasing the job satisfaction of the employees by providing them with several benefits and rewards such as profit- sharing, job rotation, job enlargement, job enrichment, on the job training, outside training, incentives, pay based upon merit and several other benefits (Jensen, Patel & Messersmith, 2013). It is necessary for the organizations to aim at becoming a high performance work organization in order to remain profitable in the high competition market (Katzenbach & Smith, 2015).
Organizational changes are necessary from time to time in order to remain ahead of the competitors and to survive in the long- run. There are several difficulties associated with changes such as resistance from employees. However, embracing changes is essential for the growth and development of an organization. Z Energy Limited is a New Zealand based company, which acts as a fuel distributor. The company supply fuel to several large commercial and retail customers such as airlines, mines, trucking companies and is one of the leading suppliers of fuel and energy in New Zealand. However, the organization is required to undergo massive hiring and layoffs in order to ensure that the best employees remain within the organization. A major issue found was presence of a large number of older staff that has become unproductive and lack the technological advancement. Another major change required for increasing the competitive capacity of the organization requires mergers, acquisitions or joint ventures. This shall increase the financial strength of the organization and shall enable the organization to explore the international markets and obtain benefits from them.
Z Energy Limited is required to emphasize upon its human resource management techniques in order to ensure successful change implementation. For this purpose, the organization must must involve the organizational employees and managers and devise suitable motivational techniques to avoid resistance to the changes. An in depth market research is necessary to identify the market trends and the marketing strategies used by the competitors. Only after the collection and analysis of the relevant data, the change must be initiated. It is also necessary to keep the organizational employees satisfied in order to obtain their support during the entire change process. The organization must follow Kotter’s eight steps of change management in order to ensure the success of the organizational change. For the change to be effective, it must be ensured that more than 75 percent of the members of the organization must feel the need and criticalness of the change. The change must be actualized when it is distinguished as any postponement in executing change may prompt misfortunes and wastefulness of the associations. It is fundamental to include the general population who should be influenced because of the progressions so that there is no protection and the change is actualized with no obstacles.
Increasing the competitiveness of the organization
Ø Collecting data regarding the competitive strategies of the rival organizations
Ø Analyzing the current strategies of the organization
Ø Making provisions for detailed market research
Increasing the level of job satisfaction among the employees
Ø Involving the employees in the change management process
Ø Offering attractive wages and incentives to the employees
Ø Using non- monetary motivational techniques to motivate the employees
Ø Implementing effective human resource management techniques
Implementing the change management successfully
Ø Promoting the necessity of the change
Ø Involving organizational employees
Ø Helping the organizational members to become comfortable with the change
Ø Following Kotter’s eight steps of change management
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