If an organisation wants to enhance or increasing their business operations they need to understand and evaluate changes within the firm and market so that they make strategies accordingly. It also help an organisation to understand and identify issues and problems that they can face in future and by it they can develop strategies which help in overcoming and avoiding issues in appropriate manner (Alavi and Gill, 2017). The organisation taken for this report is AEGON which is established in 1983 and its headquarter is in Hague, Netherlands. It is life insurance, pensions and assets management company which is conducting its operation worldwide. The numbers of employees in respective company are approximate 28,300. Topics explained in this report are example of organisations and how its operation and strategies affected, internal and external drivers of changes that influences leadership and steps through which a firm can minimise negative effect. At it will explain various leadership approaches which help company in dealing with problems in effective manner.
P1 Compare firms where there has been an impact of changes on an organisation's strategy and operations
In today time the major reason behind conducting business operation and function is to earn profit and grow market shares or for well being of social group. According to respective case of AEGON which is a multinational life insurance, pension and assets management company that is planning to become a well known brand at the worldwide level (Anderson, 2016). But government of United State impose certain barriers that directly and indirectly affecting negatively to the respective company profitability and market shares. For understanding the appropriate situation of changes that affecting function and operation AEGON conduct comparison analysis with its competitor The Hartford financial service group. Comparison of both companies are given below:-
In AEGON is conducting their business in hierarchical organisation structure in which there are different stages or level such as upper level, middle level and lower level. Information and guidelines which is given by upper level reach to lower level while following various other stages which is time taking. So the respective company decide to change their organisational structure into flat. Main reason behind changing the organizational structure is to improve performance and productivity of employees. Along with this they want to reduce time duration which is taken for making any decision. By this they able to taking decision become easy as well as employees feeUnderstanding and Leading Change satisfy because they are treating at the same level according to department and grading (Fragouli and Ibidapo, 2015).
Strategy: The major strategy to implement flat structure at organisation is leads to motivate employees which directly help them in improving their productivity in effective manner. By this employees are treated as same level and there is also reduction in conflict.
Operation: By adopting flat structure at workplace there is certain positive changes occur at firm such as now they required less time in decision making process which save their precious time (Fullan, 2014). Through this completion timing of production or task get reduce, now employees complete their work within the given time or at time.
The Hartford is conducting their operations and function in hierarchical organisational structure in which they are facing some problems so they decide to change their organisational structure from hierarchical to flat structure. Through with their employees able to communicate with each other in effective manner which motivate and develop feeling of connection in them towards the respective organization. When staff of The Hartford feel motivated they conduct there work in appropriate manner which reduce manufacturing and operational cost (Doppelt, 2017). Along with this they able to reduce wastage during process. Through this they able to earn more profitability ratio and enhance market share. Employees turnover will also get reduce.
Strategy: The respective company create plan and strategies through which they reduce wastage and conduct their operations in appropriate manner. For this they provide training and development sessions to their employees so they conduct their work in appropriate manner.
Operation: By developing respective changes in the The Hartford they able to reduce wastage and operational and manufacturing cost. It become possible for respective company by using several functions such as develop rules reduce wastage, train employees how to conduct particular work in appropriate manner, compare cost of different suppliers and many others.
P2 Determine ways in which internal and external drivers of change affect leadership, team and individual behaviours
Drivers of changes refers to the element through which change is occur in the operation function of an organisation. It is a disruptive force which present in almost all scenarios and it has different impact or influence on particular scenario. The drivers of changes is divided into two type that is internal driver and external driver, that affect the operation of a business operations. Internal drivers of changes in this process had been identified through SWOT analysis. Some major change drivers which affect AEGON operations are explain below:-
Internal Drivers- Internal drivers of changes refers to the forces which are present inside an organisation and which control and affect the management of a work-place (Gupta, 2011). Internal factors that affect AEGON operations and functions are-
- Organizational culture: It represent the believes, values, attitude and behaviours of an individual as well as group at a work-place. The improper behaviour of a staff or employees will affect performance and productivity of whole team in AEGON company which also affect on company's profit. Such as in AEGON some peoples behave weirdly to other employees, so to prevent or overcome from this situation the management of respective company develop policies and rules regarding discrimination. Such as if there is improper organizational culture in respective company this will affect behaviour of individual through which conflict arise in team. Which directly influence productivity of employees and decision making of leader.
- Employees moral: It refers to the confidence and strength level of a person or employee and it is very important for a company. If employees have low moral or less committed toward job they will affect company operations and functions. So to avoid this type of situation the respective company develop various programmes to motivate employees. Some of activities are they provide training, organize motivational session, organise activities and parties and many others. Such as if leader of AEGON done effective planing for developing employees moral it will enhance productivity of employees which leads to affective team work. By this organisation able to achieve goal and objective in effective and appropriate manner.
External Drivers- These refers to the factors or situations which present outside of an organisation and it can't be controlled by an organisation itself they can only develop strategies accordingly (Hillson and Murray-Webster, 2017). Which help an organisation in conducting their operations and functions in effective and appropriate manner. External drivers in respect of AEGON are explained below-
- Political- If there is occurrence of political factor it will directly and indirectly influences the funding and priorities of an organisation. Company has to develop strategies and action plan according to political factors. Such as AEGON has to follow various rules and policies for conducting their business and if government changes or modify their policies and rules the respective company leader has to develop strategies and plans accordingly. When there is change occur in political conduction it will affect policies of respective company. When AEGON adopt changed policies it will directly and indirectly affect the behaviour and working of leader, employees and team and employer has to develop policies according to changes.
- Economical- There are various change factors which are included in economical factors such as employment rate, interest rate, customer behaviours, inflation rate and many other (Jones and Harris, 2014). These all factors directly influence decision making process of leader in AEGON company such as if there is reduction in buying power of respective company. This will influence the production process and effectiveness of employees at AEGON company. For example if change occur in economic condition of customers it will affect their buying power and respective company leader has to design and manufacture products according to demand and economic condition of consumers. When change will occur in economic condition of country, it will directly affect company's economy and managers has to develop strategies accordingly. Which leads to change in behaviour of team as well as individual. Such as if economic condition get of company get decrease then it will directly impact on employees salary and resources funding. This will affect production and productivity of employees in respective company.
- Social- The factors which is include in social is need and demand of target customers at market place of an organization. So if there is any change occur in customers need and demand AEGON Company leader develop and design plans and strategies accordingly but some it will leads to wastage of old products. Sometime this will directly affect employees motivation and productivity of group or team. So to avoid this situation the leader of respective company do regular market trends analysis and then develop new strategies and plans according to trends.
- Technological- This factor enhance the productivity and quality of a production process of an organisation by improving and updating technology which is using for production. In AEGON Company they use advance technology which make employee's work easy and they able to do more work in less time. Through innovate of technology respective company able to improve employees work quality and quantity. Along with this, there is increment in employees motivation and productivity of staff at AEGON Company. The leader of AEGON conduct regular market analysis and then develop strategies and plan according to new technology and consumer demand.
P3 Explain various methods that can be taken to reduce negative impact of change
In an organisation change plays a essential part in conducting business life cycle in smooth manner because by it they able to adopt new technology and other things from environment able to enhance their market position (Komives, 2016). In AEGON impact of change drivers is positive in following manner it help leaders to enhance their staff moral, help in conducting operations in appropriate manner, conduct process in effective ways and many other. Along with this there is some negative effect of change drivers in respective company such as leader has to make new strategies and plans according to situation which is time taking and increase mental stress of leader, sometime management has to do cost cutting that affect directly to employees salary and other benefits and so on (Lawrence, 2015). It will also reduce employees motivation and satisfaction towards an organisation. For avoiding these type of negative outcome of changes AEGON use PDCA model for measuring factors, which is describe below:-
Plan- In this stage a company conduct market analysis and identify issues, opportunity and according to that they develop strategies to solve issue and grab opportunity (Lloyd, Boer and Voelpel, 2017). Such as at this step AEGON conduct market analysis at regular basis to identify issues, problems, opportunity and new trends. Through this they able to reduce affect of changes by developing plans and strategies in effective and proper manner. For example respective company facing problem in attracting customer and by analysing situation and market they able to know that they are lacking in promotion stage. So they plan to improve their promotional technology by using digital and social media techniques.
Do- At this stage an organisation evaluate strategies which they develop in above stage as a potential solution (Painter and Clark, 2015). They do evaluation on small scale and identify effectiveness of the result. Such as in AEGON evaluate plans and strategies which they develop at plan stage and identify the effectiveness of the strategies. So to improve their promotional technology by digitalisation and social media. They plan to train their employees that how they can promote their business effectively through social media such as twitter, face book, Instagram and so on and digital media like email marking, pop up advertising and many others.
Check- In this stage an organisation measure the effectiveness of plan which they made and identify whether plan is effective or not (Van der Voet, Kuipers and Groeneveld, 2015). Such as at this stage respective company compare their expected outcome from actual outcome and identify whether plan is effective for them or not and if their is any changes required they conduct respectively. For example they conduct check whether their selected promotional channel is effective for them or not. If they identify any issues they update or conduct changes accordingly. If plan seem inappropriate they will drop respective channel and identify new one which is more effective and appropriate.
Act- It is the last stage of PDCA model at this stage if an organisation find that plan is appropriate they will implement it successfully. Such as if AEGON identify that their plan or strategies which they make above they will try to implement it an organisation. Then accordingly train their employees so that they didn't face any problems and issues while working in respective condition.
P4 Determine different barriers of changes and how they affect leadership decision
While conducting changes in an organisation, sometime barriers may occur that create gap in among actual practice and standard practices which develop negative effect on daily production activities at workplace (Anderson, 2016). So it responsibilities of managers and leaders of an organization to evaluate market and identify barriers and then develop strategies accordingly to solve problems respectively. AEGON company use force field model to analysis the changes, which is describe below:-
Force Field Analysis Model:
This consider as model a company can do evaluation and analysis changes which occur in an organisation, it is consist of two forces that is driving force and resisting force. Driving force help a firm in identifying and conducting changes and adopt it within a work-place. Whereas resisting force is a kind of barriers which is come up in between while adopting and implementing changes. It is consider as one of the effective and essential technique for decision making procedures. Evaluation of force field analysis in context of AEGON are explain below-
Driving force: This refers to changes in forces while changing in customers needs and demand of an organisation, their leader has to develop strategies accordingly. Such as in respect of AEGON their customers are demanding new life insurance, pension records and so on. Along with this employees and customers are demanding new innovative techniques for storing data and information in effective manner. Do now the leader of respective company plan new strategies and plan to fulfil demand and need of employees as well as customers and implement it in an organisation.
Resisting force: This refers to several restriction or barriers which a company face when they plan to implement change their organisation (Doppelt, 2017). Such as implementing change at work-place required huge cost or funding, lack of employees support because they didn't want to adopt or accept change and they are restrict to current techniques and technology. This type of employees behaviours affect profitability and production of a respective organisation. So leader of AEGON decide to motivate and encourage their employees so that they will conduct work in effective and appropriate manner.
Their are some barriers which a firm face they plan to adopt changes and it also affect decision making process:-
- Lack of staff involvement- It is a some common barriers which a firm face when they adopt any new change or innovation (Fragouli and Ibidapo, 2015). Same think management of AEGON is facing when they implement change at their workplace employees didn't show any involvement and interest. It occur because they have a fear that new technology will reduce their responsibility, values and importance at respective workplace. So the leader of AEGON plan to conduct meeting and insure them that their values and importance will not reduce and only reason behind adopting change is making their work easy and they able to do effectively.
- Lack of Finance and investment- For conducting any kind of change finance or funding is required by which they able to implement changes in effective manner at the workplace. Such as when AEGON Company plan to adopt new technology for preventing data and information form getting misuse they select several application and technology. After that they do analysis of funding and budget which they made for adopting new techniques they get to know that they didn't have very budget. They can adopt application which is of middle range. So leader of respective company select application and technology which required middle funding.
P5 Evaluate different leadership approaches for dealing with change
Their are various leadership style which AEGON use for dealing with changes, some major of them are explain below:-
System Leadership Style: In this approach, leaders creates condition that helps their team members to work efficiently in accordance with their potential (Fullan, 2014). In this regard, it will help leaders of AEGON in predicting behaviour of their team members in according to the assigned task. This will help a business organisation in sustaining its productivity for a longer duration by implementing changes. This style will help a respective business entity in bringing effective organisational change, which leads in improving their overall growth. The advantages which respective organisation gain by implementing this is they can adopt frequent changes which arises in a business environment and by it employees of a respective business can achieve organisational as well as individual aims and objectives in effective manner. But there are limitation like this is not profitable for smaller organisations and it delays decision making process of a business organisation.
Lewin's Change Model:- It is a theory which is based on three step model that is unfreeze, change and refreeze which help an organization to conduct effective change. The AEGON Company conduct Lewin's change model to design frameworks that help their managers or leaders to develop strategies respectively on the basis of situation. Explanation of respective model is explain below:-
- Unfreeze- In this step leader or managers of AEGON Company identify changes and take approval from their management that certain change is required in an organisation. For example respective company identify need of changing their promotional technique which they are currently using. They are using only print media for the promotional program but now they are deciding to use digital and social media for which they take approval from senior employer.
- Change- In this manager and leaders communicate change plan to other peoples of a company and try to resolve rumours related to change (Gupta, 2011). After that they develop plan and strategies according to need by involving employees in change process. In this respective company develop accurate plan to develop strategy.
- Refreeze- in this respective company develop ways by which they implement changes and sustain it for long term in an organisation. For this they design develop and training programmes and explain to employees that how to use this technology and why it is beneficial for them. By this employees know effectiveness of new promotional technology and how to use it.
From the above mentioned point it can be conclude that for changes play an important role in an organisation operations and functions. Implementing change in an organisation resulted in both positive impact as well as negative. If a company want to check effectiveness of changes they can compare their strategies and operation to their competitors or other companies. Their are two type of drivers of changes which affect leadership, team and individual behaviours at a workplace. These drivers are internal and external drivers of change. Their are some negative impact of changes and to overcome it company takes various majors or steps. Their are several barriers of changes which an organisation face and there are different leadership approaches for dealing changes.
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