Organizations don't change,people do.

It is trite to assert that until people change,there will not be any organizational change.This piece looks at change through the prism of the perspectives of structure,strategy and organizational alignment with Chandler's model as the anchor.

The literature on change management highlights the imperatives to be either of strategic or tactical nature to which all organizations must respond to remain alive. Organizational Darwinism posits that it is not the strongest of species(firms) that survive or the most intelligent,but the most responsive to change.Change in the environment comes from:
The Strategic-transformation,business process re-engineering,new technology introduction,mergers and acquisitions,six sigma and strategic planning.
Or the tactical- restructuring,down or right sizing,organizational redesign,that is flattening of the structure to team self management.In all these readers will notice that they are all people centered

However,as a CEO confronted with the conundrum of structure and people on the one hand,and strategy and people on the other,you will equally have to deal with the issue of what approach to take in solving the conundrum.The strategy literature highlights three schools of thought,namely the Chandler (structure follows strategy),the strategy-structure alignment(which sees organizational design as a comparative advantage,and the strategy follows structure ,a reverse of the Chandler model.Basically the argument is this, between the chicken and the egg which one comes first?

I take the middle course as the symbiosis between structure and strategy as a relational concept, one cannot do without the other no matter which comes first.The critical point is in ensuring the right strategic fit between function(strategy) and form(structure) and vice versa.The common denominator is the value proposition an organization seeks to deliver to its customers and the value derivable therefrom,having delivered it.And in trying to deconstruct the organization in the light of this,the factor of culture must be located which ultimately constitutes the organization's DNA-structure,strategy and culture(Nielsen&Fernandes).Together they constitute the firm's organizational culture.Organizational DNAs are comprised of decision rights,information,that is communication up,down and across the hierarchy, motivators/incentives framework and structure.The first three aggregate culture.An optimal organization delivering on its value proposition is one in which there is an interdependence of all four factors.All must be available sufficiently and in the right measure in the organization to guarantee optimal performance,profitability and growth.Optimal strategy execution therefore is a sine qua non.This is the business's sense of purpose(Drucker).

A strong culture and structure it is axiomatic correlates very strongly with ability to execute strategy and ability to remain competitive.The ability of an organization therefore to convert strategy into action correlates with the proper fit between its culture and structure;ability to withstand and deal with economic discontinuities in the operating environment of the firm.The corollary is its ability to manage the change process that becomes a consequence of these changes in the environment.
Whereas the literature on change management often is iterative on the reformation of the structure of the organization,the place to look for real change motivators is in the culture as structure is given and is hard,but easier to deal with,a bit of a contradiction one would say.While some practitioners tend to place more emphasis on rejigging the processes and practices(part of culture) to the detriment of structure,it is my submission that the interdependence of both drivers makes it imperative that they be given equal consideration when executing a change program.

Culture reinforces structure and vice versa in change.As you move the boxes and lines in the organization chart,so should you tinker with the culture,the soft side to achieve the desired balance and outcome of the change management effort.It is when people in the firm change in response to the program of change that the organization can change.

Managing Change:You need To Be "Unreasonable".

Managerial dynamism Stacy (1992) said lies in the territory of "unbounded instability" where leadership role in change management requires what George Bernard Shaw,argued "all progress indeed,depends on unreasonable men since only unreasonable men endeavour to adapt the world to themselves instead of adapting themselves.........." to the irrationality of men (sic).
What Shaw simply implied is that for a leader to achieve his goals (personal and organizational),he must do the extra-ordinary even when it appears ordinary by changing the world around him instead of the world changing him;because it is wont for people to want to remain where they are,being their comfort zone.It is perfectly human.

Even so,it is Stacy's view that managing 'unbounded instability' signifies that leaders or managers in the organization must accept the fact that the state of affairs will be in constant flux,that they possess no fixed idea or notion about the long-term prospects of the business.For progress to be made therefore,new approaches must be engaged in the fore knowledge that 'instability and crisis' must exist to generate new perspectives, that provoke continuous questioning of the status quo,which an unkown and unknowable future creates and can be created and discovered.In other words, leadership must in a strategic manner create the organization's future through innovation and continuous change, incremental and large; creatively destroying the old for the new.

William Gates,founder and former chairman of technology giant Microsoft,offers his insight on the subject when he said,"we must read,ask questions,explore,go to lectures,compare our notes and findings with each other,consult experts,day dream,brainstorm,formulate and test hypothesis, build models and simulations,communicate what we are learning and practice new skills".Conceptually, Gates has effectively enunciated and framed the boundaries of a knowledge organization driven by continuous learning,a framework in turn enabled by the demands of industry in constant state of change."Unbounded instability" demands no less of all organizations that want to remain competitive and survive in their industry category; a degree 'of unreasonableness' from leaders to achieve this long term goals is a sine qua non.

Perspectives On The Clash Between National And Organizational Culture.

ABSTRACT.

Governance in the corporation is about the management of policies,processes and decision rights of individual employees in the organization(system).But how then do we determine how systems yield their behaviour to individual behaviours that are associated with deterministic chaos; chaos that is attributable  and attributed to environmental factors(natural and sub-national cultures)


Introduction:

Governance in the organization is about the management of policies,processes and decision rights of employees .But how then do we determine how organizations as systems yield their behaviour to individual behaviour s that are associated with deterministic chaos;chaos that is attributable and often times attributed to the environmental factor of national culture and its sub-stratums or tributaries if you like.

Factor determinism therefore is to be seen as contributing conditions to complexity in systems.We shall attempt to aggregate individual behavioural phenomena into a whole thereby highlighting the importance of factors such as cuture,ethnicity,religion and language(aggregate national culture) as contributing factors to complexity in organizations. The question is, are there causal relationships between contributing conditions and complexity in organizations when analysing them as complex systems?
Organizations are complex systems,opines Dooley&Van  de Ven(1999).Our interrogation dwells on the role of national conditions earlier adumbrated,whether they are critical components in the complexity of organizational culture,its affective role or otherwise in workplace diversity, its effect on performance outcomes and productivity.

CULTURE CLASH AND HOFSTEDE'S PARADIGM.

In determining the likely congruence or otherwise between national and organizational culture,we consider Hofstede's definitive study of cultural dimensions in the workplace as a paradigm in his 1984 study of "culture's consequences and work related values" and the 2001 study on related values using the United States and China as comparators. The studies classified these values into power,distance,uncertainty avoidance,masculinity-ferminity,individualism-collectivism and Confucian work dynamics also known as Long/short term orientation which Hofstede carried out in conjunction with Bond(1988).The Confucian dynamics dimension was added by the researchers in an attempt to fit it into the uncertainty avoidance dimension under the earlier IBM survey(1984).We now consider the five dimensions.

Power Distance(An unequal distribution of power): this refers to the width of the gap between superiors and sub-ordinates in the exercise of authority and power in an organization. The implication in managerial terms is that a high premium is placed on hierarchy in the organization.There is a wide gulf between managers and employees in high power distant orgnizations.Low power distant organizations on the other hand tend to have flat organizational structures.High power distance would tend to correlate with autocracy where managers hardly would consult sub-ordinates before taking decisions that affect them.Coversely too,the democratic ethos would tend to govern low power distance organizational environments.

Uncertainty Avoidance: this refers to the level of employee tolerance for ambiguity.High prevalence of uncertainty avoidance in organizations tends to have codification of rules to avoid uncertainty or be assured of the exactitude of a course of action. Conversely,low uncertainty avoidance organizations have fewer written rules and regulations.

Individualism-Collectivism: is about how people in the organization value themselves either as individuals or as groups;whether they are driven by individual interests towards self-actualisation career-wise or more towards organizational benefits.In other words,a low individualistic value places the collectivist aspirations above that of self.

Masculinity-ferminity dimension identifies the role gender plays in the organization.Does the organization recognize women as vital parts of its tapestry.Does the organization accord opportunities to women to aspire to play greater roles in top management?In other words,do women have equal opportunity for top management jobs the same way like their male counterpart?Is there equal pay for equal work between the two? Low masculinity-ferminity driven organizations tend to accord more status to women than high masculinity-ferminity driven ones.

Although not relevant to our discourse it needs be noted however that the Confucian Dynamics dimension propounded by Hofstede and Bond(1988),incorporated the Chinese in the survey based on traditional Chinese cultural values which are distinct from western based cultural dimensions upon which the 1984 and 2001 surveys were conducted(For a fuller examination of the subject,see "Cultures and Organizations: software of the mind by Geert Hofstede and Michael H.Bond,(1991).
In summary,the Hofstede study demonstrated  how national culture differs along these five paths of individual integration into groups, differences in roles between men and women,the degree to which uncertainty is handled,the trade off between long term and short term interests of individuals and organizations, how the issue of inequality is handled,of cultural diversity in the work place.
Hofstede's four dimensions is then juxtaposed with organizational culture to see the point of inflection,if any between the two concepts,how of the fact organizational culture acts as a common denominator to contributing conditions to complexity of national culture.Put differently, how organizational culture though less complicated, is able to moderate,bridge and make more manageable, the contributing factors to chaos in the firm.

Lok and Crawford (2004) note the influence of national culture on organizational culture as well as leadership styles.In their study of these values and their effect on organizational performance in Australia and Hong Kong,it was established that values,attitudes and beliefs which together constitute national culture sometimes clashes with organizational culture and does create challenges for leadership(Majeed,K,et al;2010)

CULTURE:THE ART OF LEARNING:
Culture it has been said,is learned;that it is not inherited as it derives from the social environment it is found(Hofstede&Bond,1991).There are many definitions of culture and by culture here we refer to both national and organizational.Hofstede defines culture as the "collective programming of the mind  which distinguishes the member of one group or category of people from another"Edgar Schein(1985) on the other hand ,states that " culture is the pattern of basic assumptions that a given group has invented discovered or developed in learning to cope with its problems of external adaptation and internal integration,and that have worked well enough to be considered valid and therefore to be taught to new members as the correct way to perceive ,think and feel in relation to these problems".Hofstede and Schein's definitions of culture are at the macro level given their sociological hew. Harder(1999) offers us the micro view of culture in that it is specific to the organization,in his article,'Primer on organizational culture',HBR,(1999).Harder metaphorized the term as an iceberg where culture is seen as 'deeper needing to be looked at beyond the tip of the iceberg'.The tip here according to the author represents 'artefacts at the waterline of the iceberg',which include,'formal policies,informal norms and explicit statements of values'.And beneath the waterline are 'values in use and taken for granted assumptions'.Harder further notes that culture
is ' pre-conscious',meaning that our individual actions , attitudes and views in relation to the organization are often operating below our consciousness, however, try as we may to reach the conscious zone of our reality.Organizational artefacts also include,symbols,and stories of the founding of the organization,its founder,his behaviour, character,leadership style,(institutionalised folk-memory  stored either consciously or otherwise),rituals or ceremonies, such as retirement dinners,long service awards,chairman's annual dinners,etc,which can form the socialisation fabric of the organization. Organizational culture also encompasses the vision,mission and value statements as well as annual reports which together form the rubric of the corporate sub-stratum.Below this but forming part of the sub-stratum we have policy and procedure manual,induction programmes for new hires,annual performance appraisals and recognition schemes;all forming the organization's human resource management practices.And finally,artefacts recognize the place of socialization through dress codes,the gravevine,time orientation,representing the informal sub-stratum.We deduce from Harder's definition a multi-layer strata of cultural artefacts which together form the gamut of organizational culture.The degree of acculturation within the organization often varies with the level of awareness of culture's role in moderating the influence of differing national cultures when members of those cultures are employed and inducted.Work place diversity occasioned by improvements in human resource management and the liberalisation of attitudes to women and minorities has seen the upsurge in multinationals bringing talents of varying degrees to the workplace and managers seeing their value and contribution to the bottomline are increasingly investing in new ideas and innovations in human capital development,which emphasizes the role organizational culture plays in the new paradigm.This is the upside.The down side of national culture vis a vis organizational culture is the complexity attendant to the entry of various multi-national backgrounds into a work place that lacks strong organizational culture to moderate the influence of such aggregations .More invidious of this influence is in team and group performance where interpersonal skills are needed to achieve team assignments.

Culture clashes come in many forms.Ferrell&Ferrell,(2011) for instance identify how national culture will affect consumer attitudes towards the purchase of clothing,smartphones and ipads in countries such as Japan,the United States and France."Why are KFC,Subway and Mcdonald's successful in most countries even when they have significantly different cultures from those of their host countries.The answer lies in the fact that organizational culture,though different from company to company,is able through mission statement guide the conduct and relationships between members of the organization by way of values and beliefs specific to it.Adherence to these values and beliefs under a cloud of shared understanding for expected behaviour form the fulcrum of organizational culture.Put differently,values,norms and behaviour expressed through policies and procedures convey a firm's organizational culture.

ORGANIZATIONAL CULTURE DERIVATION:

How is organizational culture derived? Organizational cultures may be derived from one or more sources. They derive from the founder or the founding team ( Hewlett-Packard,Apple ).Developing a life of its own organizational culture could amplify due to the strong character and charisma of leadership at the helm of affairs of the company ( Jack Welch,GE;Lee Iacocca,Chrysler).However,the question is, of the cultures which is stronger? Does organizational culture erase or diminish national culture?To answer the first question we turn to Nancy Adler who in her book "International dimensions of organizational behaviour" argues that contrary to anecdotal evidence of organizational culture being stronger,national culture often trumps the former.Adler's supposition was based on Andre Laurent's study on cultural differences when he established that " cultural differences were significantly greater among managers working within the same multinational firm than those working among managers for companies in their own native country.When working for multinational companies,Germans become more German, Americans more American,Swedes more Swedish and so on".The reason for this behaviour can be located in the resistance to organizational culture of these companies when encountered by the beliefs and values of their national culture.Nazarian,A,et al (2013) reinforce this notion in their study of "the relationship between national culture and organizational culture:the case of Iranian private sector organization",(Journal of Economics and Business,Vol 1,No 1,February,2013);wherein Hofstede's five dimensions of culture were used to measure the correlation between national culture and its organizational counter-part.

MANAGING CULTURE:
Since culture as defined by various authors (Hofstede,1984;Hofstede&Bond,1984,1988,2001;
Schein,1985;Harrison&Carrol,1991;Majeed,K,et al,2010;Harder,2010),we ask the question,can culture be managed?This question has elicited a great deal of controversy among academics,practitioners and consultants of management.


Article to be concluded shortly.

 

 

FRAMING THE ORGANIZATION'S ETHICAL BOUNDARIES.

It is imperative of good leadership to be guided by a set of ethical values. All organizations must have boundaries and controls to ensure that employees are acting in accordance with ethical standards. These include:
 Clear budgeting and accounting systems
 Include the use of activity based costing (ABC);this is a method for estimating the resources required to operate an organization's business processes
 The requirement for multiple signatories for bank accounts.
 the separation of the purchasing role from the accounting role within the organization regardless of size.

COMMUNICATING VALUES.

Even when the leadership and staff have identified a small set of values that are non-negotiable in their organization,these are often not translated down to the lowest levels of the organization.
Guiding values must be easily accessible and communicated clearly in language that resonates with employees.
In addition,the employees must be encouraged to use the language in the value statements and refer to the statements when making ethical decisions.

LIVING VALUES

Company leadership must be personally dedicated, visible role models who follow through on organizational values
When the leader respects and integrates organizational values into management decision making, employees will subconsciously form social contract to abide by the respected organizational values,
Annual audits through a credible external auditor reinforce ethical values.
Inventory control, checks and balances for detecting fraud should be encouraged.
Organizations should actively employ the benefit of computer software for trading components of their operations, especially sales,costs and cash flows.

REWARDS AND SANCTIONS

Creating a dream team with ethics requires an environment where it is tough to be unethical and where behaviour is always detected and punished.
Conversely,ethical behaviour must be expected, lauded and rewarded.

SYSTEMS

It is widely accepted knowledge that systems and structures instituted within organizations especially those that address marketing,compensation,human resources, finance and accounting practices, typically shape the conduct of management and employees.
Similarly,there are systems that explicitly strengthen an organization's ethical culture.

AN ETHICS SYSTEM INCLUDES:

Mission or values statement,code of ethics and within standards of ethical workplace conduct.
Orientation and continuing education or ethical workplace conduct including auditing, accounting and reporting.
Ethics managers,ombudsmen,compliance officers,committees,offices or information sources(hotlines,emails,websites,where employees can get advice about ethics related issues)
Channels for employees to anonymously report violations of ethics standards complete with formal protective mechanism, so that employees can discuss ethical dilemmas and report unethical behaviour without fear of reprimand or victimisation.
Evaluation of ethical conducts as part of regular performance appraisal and sanctions for employees who commit ethics violations.
Fair and timely payment of salaries to motivate and build loyalty between employer and employee.

SUMMARY

An organization's core values are manifest in its culture;that is in the basic ways that its business is conducted,how decisions are made and how rewards are distributed.How its employees are treated,how its customers are seen?
Employees learn these ways by doing business through observation of how colleagues and superiors behave. If no expectations are established and effectively communicated, employees will make it up as they go along when faced with ethical dilemmas.

Change Management:Its strategic Imperatives in the Organization.

The literature on strategy states that strategic change management provides the rear opportunities as well as challenges,(provided top management sees this as such)devoid of internal politics for companies to achieve the desired turn around of their economic fortunes. But the issue has never been about the need for change, but more of how to go about it and its direction, its ultimate outcome; because all change management efforts have pretty high casualty rates in human terms. And depending on the attitude or philosophy of whom it is on whose shoulder the effort will lie; is to the extent of the human effect. Whichever way, change management efforts that achieve results  do so at some cost, however minimal we may want them to be.

Basically, two tenets govern change situations and these are, 1) that a change manager should understand the outcomes people in  and out of the organization must expect and understand how they will behave towards his or her leadership and the effort itself, 2) that the leader must change the outcome people expect in order to change their behaviour positively towards the new order.
The problem has always been about how those that should drive the change effort approach the task; more often it taken as an heroic effort or some ego driving thing, which then elicits the opposite reaction from employees. Henry Mintzbeg,notable professor of management studies, is of the view that most firms over state change management, often seeing the view that "change only comes from the top".He further declares that the idea of change management in American corporations is "cultic"of heroism and driven by outsized corporate ego.He contends that most organizations succeed at change management not because of what top management did,but because of the "small change efforts that begin at the middle or bottom of the organization........which are belatedly recognized as successful by senior management".

John Kotter,in his article "Leading Change:Why Transformation Efforts Fail," in the Harvard Business Review,(01/07),Volume 85,page 96,offers us his perspectives on the subject. He is of the view that change management efforts often come to nought because they move too quickly or are slow at implementing changes;at other times are careless about it.In moving too fast top executives fail to assess the likely risks inherent in the process, tiring up the notion of urgency where none perhaps exist just to motivate behaviour towards the change desired.
Organizations wont change until individuals in it change, is an instructive mantra. It is the individual change management that coalesces into that of organizational change management. As each employee applies him or her self to their work function differently, this is multiplied across the organization. But then individual change management is dependent on the following(what the PROSCI model calls ) ADKAR,meaning: Awareness, Desire, Knowledge, Ability and Reinforcement.
To achieve the desired change successfully, the individual employee must possess the awareness of the need for change, have the desire to be involved and support the change effort, the ability to implement the required skills and behaviours and finally, reinforce  all of the above to sustain the change effort.

SOURCES OF FAILURE OF CHANGE MANAGEMENT EFFORTS.

In recent surveys on transformational change efforts, chief executive officers reported that 75% of their change management efforts failed. These efforts failed not because they were based on faulty assumptions or high fallutin targets or strategies; but rather around organizational re-designs, restructuring or new efficiencies with the hope of getting everyone to share the vision and work with these strategies. These CEO's failed to notice that their people didn't want to change because they didn't believe in the change they were "foisting" on their organizations.
In identifying the sources of failure of change management programs, the lack of consensus between the top and bottom of the organization has been the most critical vector. Even though the sense of urgency may be driven by outside sources, it is imperative that leaders within the organization  build the needed consensus to drive and sustain the transformation process. The consensus must begin from the board of directors to the shop floor, coalescing to create the shared vision for the change. This shared vision must be clearly thought out step by step, into short term,mid-term and long-term goals; with quick win goals emphasized in order not to flag the initial momentum gathered for the effort. Flagged momentums are often difficult to reignite.

THE BEHAVIOURAL CHANGE FACTOR:

Behavioural change is a precursor of successful transformation efforts. It is a key ingredient in all change management efforts. Change management succeeds or fails on the first hurdle of behavioural modification. Attempts therefore must be made to first of all resolve the behavioural factor because it rests on this pillar. But why is this so? Human behaviour is difficult to predict, as it is difficult to alter more so when 'enamoured' of situations it cannot control. A typical change management situation is that of mergers and acquisitions where under the traditional change model employees undergo behavioural changes or swings of "denial,resistance,exploration and finally commitment". Most CEO's fail to acknowledge the fact that employees must go through this emotional rollercoaster of behaviour. Failure on the part of top management in charge of transformation processes end up having employees who are burned out before even the process has begun, to overworked and demoralized work force.
Organizational psychologists state that employees are not overtly or covertly subversive of change management efforts; instead they "may be unwittingly caught in a competing commitment.....which is a subconscious hidden goal that conflicts with their stated commitments" to the situation at hand.
Kegan and Lahey in their article,"The real Reason People Wont Change"(HBR.On Change,2011),argue that based on the above assertion,managers in change management situations must reflect individual attitudes to the process of change within the context of the change model earlier enunciated and guide people through the exercise of behavioural change as a  priority with understanding and sensitivity fitting this activity within the strategic change management process.Competing commitments they assert make "people immune to change.Worse,they can undermine your best employees-and your company's success"For a fuller discussion please see the book;page 119-136.

THE ORGANIZATIONAL CULTURE FACTOR:
        
It is axiomatic that culture is one of the critical parts of an organization's DNA.A change management process without a review of  its readiness(organizational culture) in change is an exercise in futility. Ellen Wallach,defines organizational culture thus:"culture is like pornography; it is hard to define, but you know it when you see it".Basically, organizational culture is the gamut of commonly held beliefs,values,attitudes and behaviours of an organization. Organizational culture essentially derives from the founding of the organization , its owner/ founder and its historic trajectory through the course of time. Organizational culture is unique and diverse;often personal in a way, since it gives individual identity distinguishing it from others.It is in the way "we do things in our company",also expressed in the social norms and shared values.

In conducting an organizational culture review, the following  steps are needed:
(1) Assess the current status of organizational culture
(2) Obtain information regarding how the current culture supports quality, effectiveness and customers.
(3) Gauge the readiness of staff for change and their ability to traverse the journey
(4) Identify and address organizational forces likely to drive or impede culture change(remembering that competing commitments of some employees can impede the commitment of others to the change management process)
(5) Create a vision for the organization's "ideal" culture
(6) Define the specific changes that need to take place
(7) Incorporate this knowledge into the strategic change management vision statement.(www,bia.ca;"From Crisis To Control:The Strategic Change Management Process)

THE STRUCTURE OF THE ORGANIZATION FACTOR:

We examine how change management or rather how "external conditions,namely the rising  economic tides that formerly lifted so many boats regardless of how well or badly they rowed",are not likely to make a lasting return any time soon unless they undertake the necessary painful decisions to turn the tide through change management.
As economic tides buffet the organization so do internal conditions namely,skills shortages,the mismatch between competencies and external imperatives occasioned by increasing sophistication of customer demands.Change management imperatives will also include maturing markets,slower growth,lingering debts from high leveraging, ageing work force and escalating cost of manufacturing inputs,supply chain constraints due to competitor actions. Increasing complexity in the industrial landscape forces managers to keep having to reinvent and reimagine their organizations in an emergent way,thus upturning prescriptive strategy models which before now were sacrosanct.

To the question how does change management imperatives affect the structure of an organisation vis a vis its strategy?We bear in mind Alfred Chandler's dictum,that " structure follows strategy".
What is strategy?Strategy we define as the determination of the basic long-term goals and objectives and the adoption of courses of action and the allocation of resources necessary for carrying out these goals and objectives.
Structure on the other hand,is the design of the organization through the firm and how it is administered;involving two spheres,namely: 1) the lines of authority and communication between different levels or stratas of offices,and 2) managers/officers and the information and data that flow through these lines of communication and authority, vertically and horizontally.

Change management affects the structure of an organization in one or more ways,like for instance,when an enterprise grows through diversification,(geographic and product),the consequence of which will be the strain on existing administrative structure due to increased complexity in entrepreneurial and operational activities. These changes call for multi-divisional forms or new operating divisions or the need to expand the controlling office-all require a new structure.
The obverse of course occurs when enterprises are forced to downsize or rightsize due to dwindling market share or product obsolescence; the scenario prevalent here is one of divestment and plant closures with the attendant contraction of structure or its disappearance.

STRATEGY-STRUCTURE ALLIGNMENT. FACTOR.

 Just as Chandler identified how single-unit business organizations grew into umbrella type structures with autonomy and shared overheads, the  present demands of the market place, customers and competitive pressures, has necessitated the alignment of structure and strategy, which is strategy driven and performance oriented. Implied in this framework is the axiom that a given strategy must reflect the ever changing environmental conditions and through proper diagnosis, identify organizational weaknesses and gaps in performance which will give way to a retrofitting of the structure through a design process that generates alternatives to the existing order. A new organizational design within the context of change management, sign-posts new roles and responsibilities for fast decision making, the development of  values and norms for culture alignment with the new strategy; included in this are new sets of rewards and metrics for performance, as well as the identification of new skillsets and capabilities required to execute the strategy-structure alignment framework.In their article, "Meeting the Challenge of Disruptive Change"(Harvard Business Review on Innovation,2001), Clayton M.Christensen and Michael Overdorf,stress the need for the development of new capabilities within the context of a new organizational design,which creates new organizational structures within corporate boundaries in which new processes can be developed;spin out an independent organization from existing organization and develop within it the new processes and values required to solve the new problem; acquire a different organization whose processes and values closely match the requirements of the new task.

LEARNING FACTOR.

It is trite to state that a learning organization is the one that continually reinvents itself ,poised to withstand the vagaries of fast-paced changes in the business environment and prosper therefrom. Kaplan & Norton;(2007) note the fact that most companies in the present day operate in very turbulent times and environment;although armed with complex strategies, which in the authors' view are valid  when they(strategies)were launched, yet lose their sinews due to the ever evolving business conditions."In this kind of environment, where new threats and opportunities arise constantly. Companies must become capable of what Chris Argyris calls double-loop learning, that is learning that produces a change in people's assumptions and theories about cause and effect relationships"(Culled from, Managing For The Long-Term; Harvard Business Review,July-August,2007;"Using The Balanced Scorecard as a Strategic Management System,"p:106.

Behavioural change, we have stated earlier is a sine qua non in change management which in turn depends on the receipt of new "information". By new information we mean learning which comes from the conversation between the people leading the change effort and those who are expected to implement the new strategies, manage the context of change in the organization as well as the emotional connections to it for the transformation to occur Duck,J.D;(1993;pp:2-3).
A typical learning situation for instance is that which involves acquiring new beliefs,behaviours,skillsets and capabilities for the transition of an engineering-driven, product-centred company to a customer-focussed marketing organization. This requires a paradigm shift,the challenge of which is not that  people are involved, but that the real test is in getting innovation of mental work instead of the replication of physical effort.It is basically teaching people to " think strategically, recognize new patterns, anticipate problems and opportunities" as they see them or even before they occur.This Teutonic shift in corporate attitude may appear easy when 10 to 20 people are involved,the real test is in getting this message to several layers of offices and levels; complexity bound if the enterprise is layered across national boundaries or divisions to tens of thousands of employees.

Organizational restructuring is about the re-orientation of human systems,the structure of which includes the "beliefs,world view and mental models of leaders and members"; changing this system structure requires changing the belief system that underpins its observance by personnel in the organization.The process of changing and re-orientating this belief system structure is called learning which effectiveness is predicated on clear,open communications throughout the organization.
At the macro level,organizational learning which forms the aggregate of individual learning of leaders,managers and employees,must be continuous in a world that is constantly on the cusp of change.
Learning is conversation across functional silos,learning is communication up and down and across organizational boundaries in single-unit and multi-divisional enterprises. Learning is education which provides employees with new skills,capabilities and attitudes to implement change.

The American Productivity and Quality Center,for example, enumerates six key elements in the change process that education in the learning framework can help to improve,namely,promotion of organizational values,provision of necessary skills or knowledge to new hires,provision of skills for career progression,provision of new skills for lateral job changes within the organization,preparation of employees for jobs outside the current organization and finally provision of a benefit to employees(rewards and metrics).
The APQC learning framework for change management is predicated on the notion that change is constant,learning must therefore equally be continuous.A perfect example of this is Sears Corporation,an American icon,which uses its educational program,including "town hall meetings and learning maps" as tools to communicate and converse with its 300,000 employees or associates as Sears chooses to call them.Sears goes ahead to establish the Sears University as a permanent vehicle in its continuous learning process.To this end for instance, in 1996, 17,000 of Sears personnel  attended courses on best practices,business knowledge and leadership skills.
And in furtherance of best practice in change management, the APQC documents companies that on a continuous basis conduct regular surveys on employee attitudes and behaviour in relation to business performance,disseminating results widely to the workforce.Doing this ensures that employees are on the same page with the leadership of change management in understanding the raison 'deter for change,its process and changes to the culture required and whether the imperatives are being met for changes to be made to the process( For a fuller reading,please see ,Organizational Change:Managing the Human Side,an APQC publication,1997 organizational change consortium benchmarking study)

LEADERSHIP FACTOR.

Readers will notice that we have left the leadership factor in change management question for the last.This is not because it is the least important of factors inhibiting successful change management. It is noted that these factors are not in the least the only ones.As a constantly evolving taxonomy, readers may also identify other critical factors which will enrich future theoretical developments in change management.
Without doubt,leadership lies at the very heart of all organizational change efforts, from the identification of the need for change to the resolution of same.One company executive of a large American corporation once identified change management process " like an organization undergoing five medical procedures at the same time.One person is in charge of the root-canal job,someone else is setting the broken foot,another person is working on the displaced shoulder and still another is getting rid of the gallstone.Each operation is a success but the patient dies of shock".

The scenario so graphically illustrated by the company executive is emblematic of the difficulty involved in transformations and why they fail (Kotter;2007).
Leadership in change management is like that of the alchemist who brings together all materials in a formulae to create a panacea.the process of alchemy is one of transformation or an algorithm.Duck;(1993) likens it to the art of balancing,managing change.The leader's job,according to the author,is to be a "visible champion for the transformation,articulating the context and rationale for the new corporate direction.Working out the guidelines and ensuring that they are understood, have the confidence and  is used".......

Leadership qualification means that the leader of the change effort is first and foremost team captain,have proven talent and credibility,understand the long-term vision of the company,have a complete, knowledge of the business and the confidence of the board.
Kotter,(2007) in his article,"Leading Change",Harvard Business Review,provides the industry with change management methodology in his eight step schema of organizational transformation,namely,establishing a sense of urgency,forming a powerful guiding coalition,creating the vision,communicating the vision,empowering others to act on the vision,planning for and creating short term wins,consolidating improvements and producing who can implement the vision and lastly,institutionalising new approaches.Kotter's schema represents the "holy grail" in my thinking of change management,as it encapsulates the algorithm of the process wherein all the factors that are involved in change process are covered to achieve the performance required.

As a learning organization,it is the leader's job to organize all the elements involved in the change process,educating,training and preparing the organization to think,feel and act differently.Duck(2007),suggests that successful change management in companies that embarked on it were of those  leaders who looked at the issues congruently between operational details and the "little matter" of employee attitude to the change process.

In summary,the real contribution of leadership according to Duck,(1993),"in a time of change lies in managing the dynamics ,not the pieces.The fundamental job of leadership is to deal with the dynamics of change,the confluence and congruence of the forces that change unleashes so that the company is better prepared to compete".

         
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The Test of entrepreneurship in the marketing organization.

Two top marketing executives, Rick Jones and Gupta Preedy,are despatched to India from Ingenio Enterprises Ltd.a Europe based footwear manufacturer. They were sent to scout for marketing opportunities.India,an emerging markets giant, is a nation of a little over one billion inhabitants; a fast rising market with more than 400 million said to have been lifted from poverty into the middle class in the last 20-30 years of sustained economic growth, driven by developments in the internet, communications and technology as well as outsourcing of IT talents to some of the world's TECH giants.Bangalore and Pune are some of India's growth poles.
This said, grinding poverty as the down side to this illustrious story goes, sees to the rest of the population below the poverty line of $1.25 a day, according to the World Bank estimates.

Upon arrival, Rick Jones and Gupta Preedy immediately come face to face with Indian poverty as observed in the number of Indians without footwear; one half of the population wore shoes and the other half were without shoes-they either walked bare-footed or wore rubber made slippers worth about one Rupee. The two marketing executives are faced with the conundrum of the glass cup: is it half empty or half full?. Or perhaps it is a perception, reality gap which often colour how marketers see markets overseas.

Is The Glass Half Empty Or Half Full.

Gupta Preedy saw a huge marketing opportunity in both segments of the population-shoe wearing and none shoe wearing-to be serviced with low cost but durable footwear. The key insight is in tailoring the marketing offering bearing in mind the twin objectives of demand, affordability and willingness. In Preedy's estimation, value lay at the bottom of the 'poverty pyramid'(C.K. Prahalad; 'Fortune At the Bottom Of The Pyramid')
However, Rick jones saw a different picture- there was no marketing opportunity, hence the company, he suggested should look for value elsewhere.
Kotler defines a market in the following words that,"a market consists of all the potential customers sharing a particular need or want who might be willing and able to engage in exchange to satisfy that need or want"(Kotler,P;1991:63)

Now from the perspective of the marketing organization, leaders need to nurture the entrepreneurial spirit to be able to generate business for the company through what is called the "causal process "which begins with a desired outcome(identifying a marketing opportunity in the Indian footwear market for instance) and focussing on the means to generate that outcome(investing in indian footwear market through one or more business combinations).
Astute marketers as identified in the case of our two 'bunnies', one of which abided by the 'lemonade principle'(Sarasvathy,S;2001:245)  highlights the acknowledgement and appropriation of contingencies by leveraging on surprises identified, rather than  avoiding them as was done by Rick Jones.The right course of action is to overcome them or adapt to them, provided the pay -off will be greater than staying away.A risk- management framework for assessing new marketing opportunities must be embedded in the marketing organization, either to minimise risk ab nitio or to provision for an exit strategy with minimal cost in the event of market failure.

Furthermore, astute marketing entrepreneurs rather see surprises as opportunities turning the unexpected into a viable,valuable and profitable venture, where the less acute in thinking sees nothing.A case in point from an organizational point of view,is the Nigerian telecommunications market which prior to 1999 had fixed lines of less than 500,000 telephones to a population of over 100million users;an industry totally owned by the national government. Reform of the sector has seen telephone lines growing to over 120million active users between year 2001 and 2013,a phenomenal growth.What should interest readers was the attitude between two sets of executives who back in 2001 conducted a risk assessment of the market.One came away with the decision to invest in the market despite adverse economic and country risk reports, the other decided not to invest.The risker taker is currently the market leader with a share of about 52% of the Nigerian market.

The marketing organization must develop in its executives,the entrepreneurial mind-set to make sense of opportunities when they see one in the context of the search for new marketing frontiers for their products or services,in what authors, Hisrich,Peters&Sheperd, "Entrepreneurship", suggest effective marketing entrepreneurs should continuously 'rethink current strategic actions, organization structure, communications systems ,corporate culture,asset deployment, investment strategies, in short every aspect of a firm's operation and long-term health'.

The marketing organization(as situated within the organization structure) is being given a new flip of new horizons for organizational growth into new markets, lineal or geographic. Developing the entrepreneurial mind-set requires the ability, to acquire what the authors call 'cognitive adaptability'; it is an ability to be dynamic,flexible,self-regulating and engage in the process of generating multiple decision frameworks that focusses on sensing and processing changes in the business environment and acting on them.And this to my mind is the crucible of entrepreneurial marketing: sensing ,seizing and acting.
Decision frameworks are organized prior knowledge about people and situations that are used to help someone make sense of what is going on;this is reflected in the marketing entrepreneur's ability to reflect upon, understand and control one's thinking and learning.This is most acute when a firm especially goes foraging into new markets abroad away from known marketing boundaries into uncharted waters like our hypothetical Indian footwear market.

Organizing The Marketing Organization.

The marketing organization that develops a passion for customers,organizes its activities around market segments instead of products and develops a deep understanding of its customer base qualitatively and quantitatively is the creative one.It is the one that creates an environment for innovation and letting marketing staff take the lead and responsibility for their actions ,if even they fail at it sometimes; imbuing employees with the entrepreneurial spirit and letting them take decisions and own the rights therefrom. This leads to the creation of new sets of skills and competencies,the motivational drive to excel in customer relationship management.

The marketing organization must look out for new trends and be prepared to optimize them.A lack of trendiness led to Motorola being 18 months behind in its migration from analog to digital telephony,thus giving its competitors such as Nokia and Ericsson the huge head start they enjoyed.
Food giant,Nestle took a while in recognizing that the future of coffee drinking laid in coffee houses,letting Starbuck steal the coffee show.CoCa-Cola,a behemoth noted for innovation was also caught unawares with beverage trending towards fruit flavoured drinks(Snapples),energy drink(Gatorade) and designer water (Avian).

Readers would wonder why erstwhile market performers will be caught off trend by competitors that ordinarily should not.This is because they are risk-averse,lacking in internal entrepreneurship such that gives executives the opportunity to engage in risk-taking within a risk-management framework.
Our risk taker,Gupta Preedy challenged marketing orthodoxy and the company's obsession with protection of existing markets as is exemplified in Rick Jones's assumption that no market existed for his company's products because half of India was shoeless.Gupta Preedy on the other hand,saw differently;he identified correctly by seeing the whole of India as his firm's market for its products.
Ingenio needless to say decided against going into the Indian shoe market as it saw through Rick Jones's crystal ball.
It is iterative to say that firms foraging across marketing borders should see beyond numbers. Number crunching honchoes would point to power point graphs and spredsheets and say no;nevertheless intuitive marketing executives look beyond this taking into cognizance Prahalad's exhortation of tailoring offerings to suit the pockets of the teeming  of consumers at the bottom of the pyramid thus unlocking the marketing value in dollar terms that lies beneath the western model in other worlds. Spredsheets matter it should be stated, but taking a position matters more in the market place as positioning goes beyond graphs. Marketing entrepreneurship is.




 

BRANDING 101

The product branding of a company is the totality of customer experience with it and its products or services. It is the overall dialogue that takes place between the company and customers when a purchase and use of its products or services is made,
This dialogue is represented in its use of logos,mission statements,slogans,pay-offs,taglines,advertising,communications(public relations,publicity);the product itself and packaging,merchandising,etc,etc.

Companies such as Cocacola have over the years dialogued so effectively with their customers,to the extent the Cocacola name has become synynmous with the fizzy drink industry,thus developing a folksy relationship with its billions of customers in a way unimaginable round the world.
The Xerox company and DHL, all have developed along this brand trajectory. Photocopying has become in everyday lexicon,simply Xeroxing a copy of document and instead of sending a document by courier, your are likely to hear,"send it by DHL",even when it may be sent by United Parcel Service or any other courier company competing with the brand.Iconic brands enter our everyday lexicon and endure through time,basically because of the halo effect built around them.And what is meant by the halo effect?

Creating a brand halo is about building around a product an association that is more ethereal than real,through the play on emotion,perception,innovation and communication.And in building attitudes towards a product,you generate emotions in two specific areas: 1) actual product or service and 2) customer experience of the totality of the company's operations;in other words,all the activities performed towards bringing a product or service to customers.

Brand halo is created through the play on emotions,perception,innovation and communication as earlier stated;all four must play on the five senses of sight,sound,smell,taste and touch.Creating an emotional atmosphere for the brand must involve therefore,appealing to all the senses,requiring the use of a media mix,for example,television for creating the appeal to sight(images with strong colors,aesthetics,surround effects) and sound that compels a customer wanting to taste or touch the product.Television has the ability to create that sense of urgency to induce trial in a well executed advertising compaign;while the outdoor medium will remind of what was seen on television;newspaper will give more technical details of the product such as automobiles,equipment,packaged holidays and tours,holiday destinations,and many more.

The human emotional make up is built on logic cum rationality as well as emotions.Whereas logic appeals to rationality,logical analysis,consciousness and awareness,which all occupy, the left compartment of the pathway in the brain, the emotional side appeals to creativity,imagination,impulsiveness as well as reflectiveness.This dwells on the right compartment of the brain.To be sure,rationality is lineal;processes data one piece at a time when stimulated.Emotionality on the other hand,takes the parallel path in data processing.James Hammond,author of "Branding Your Business",states that people buy on emotion and justify with reason.He further suggests that companies build strong brands when their customer's experiences exceed already determined expectations,which in turn evokes strong memories when they go back for repeat purchases.Exceeding customer expectations the first time,in my view is like a bank deposit of favourable images of a brand which a company accumulates when customers repeat their dialogue with the company's product or service.

For example,in automobile advertising,observe how campaign themes appeal to the soft side,namely emotions through the emphasis on design, exquisite interiors,class and the fulfilment of maslowian emotional needs of self-esteem and actualization-the acquisition of expensive "toys".The logic rationality side dwells on the type of wheels;is it alloy or ordinary?(Alloy remember commands more money and is class);engine capacity;emphasis is also on performance(torque) and the economics of fuel consumption;thus suggesting the emotional duality of the human make-up psychologically,and his behaviour as a consumer.
                              
Building the bank deposit of customer expectation is through brand advertising of a company's product or service over the long term,which appeals to the emotions of the customer.Branding and its adjunct marketing activity must be seen as an investment,the same way finance will see investment in new machinery or the building up of inventory.