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«MICHAIL MAVROMATIS JOHAN OLOFSSON Department of Civil and Environmental Engineering Division of Construction Management CHALMERS UNIVERSITY OF ...»

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Leading organizational change

An exploration of the journey between establishing and realizing

a vision: a case study at Platzer Fastigheter AB

Master of Science Thesis in the Master’s Program Design and Construction Project

Management

MICHAIL MAVROMATIS

JOHAN OLOFSSON

Department of Civil and Environmental Engineering

Division of Construction Management

CHALMERS UNIVERSITY OF TECHNOLOGY

Göteborg, Sweden 2013 Master’s Thesis 2013:120 MASTER’S THESIS 2013:120 Leading organizational change An exploration of the journey between establishing and realizing a vision: a case study at Platzer Fastigheter AB Master of Science Thesis in the Master’s Program Design and Construction Project Management

MICHAIL MAVROMATIS

JOHAN OLOFSSON

Department of Civil and Environmental Engineering Division of Construction Management

CHALMERS UNIVERSITY OF TECHNOLOGY

Göteborg, Sweden 2013 Leading organizational change An exploration of the journey between establishing and realizing a vision: a case study at Platzer Fastigheter AB Master of Science Thesis in the Master’s Program Design and Construction Project Management

MICHAIL MAVROMATIS

JOHAN OLOFSSON

© MICHAIL MAVROMATIS, JOHAN OLOFSSON, 2013 Examensarbete / Institutionen för bygg- och miljöteknik, Chalmers tekniska högskola 2013:120 Department of Civil and Environmental Engineering Division of Construction Management Chalmers University of Technology SE-412 96 Göteborg Sweden Telephone: + 46 (0)31-772 1000 Reproservice / Department of Civil and Environmental Engineering Göteborg, Sweden 2013 Leading Organizational change An exploration of the journey between establishing and realizing a vision: a case study at Platzer Fastigheter AB Master of Science Thesis in the Master’s Program Design and Construction Project Management

MICHAIL MAVROMATIS

JOHAN OLOFSSON

Department of Civil and Environmental Engineering Division of Construction Management Chalmers University of Technology ABSTRACT Organizations embark on a journey through an ever-changing environment in conquest towards fulfilling a vision. During this journey, the organization has to adapt to the changes that they are facing, wherefore it is interesting to study how they are managing these challenges. In this thesis, the authors have examined how Platzer Fastigheter AB has managed a transition that aimed to prepare them for what the future has in store for them. The transition comprised the implementation of new core values, new key performance indicators and a new organizational structure. These organizational changes involved the whole organization, from the owners through the board of directors, the CEO, the middle management and down to the employees, wherefore a major part of it was change leadership. During the work with this thesis, the authors conducted a series of interviews with key personnel at Platzer Fastigheter AB that was supported with theory in order to give the authors a deep understanding of how the change process was conducted. Their study revealed that the link between establishing and realizing a vision is the ability to lead a constantly changing organization. Also, a more case specific conclusion was found which shows the importance of a project leader that has the overall responsibility for the process and can establish commitment through communication within the organization, and that leaders have to adapt their leadership to different situations.

Key words: organizational change, leadership, journey management, change management, strategy, vision, core values, key performance indicators

–  –  –

MICHAIL MAVROMATIS, JOHAN OLOFSSON

Institutionen för bygg- och miljöteknik Avdelningen för Construction Management Chalmers tekniska högskola

SAMMANFATTNING

Organisationer kan sägas vara ute på en resa genom ett ständigt skiftande landskap i deras strävan mot att nå sin vision. Under den här resan behöver organisationen anpassa sig till de utmaningar den möter, varför det är av stort intresse att studera hur de klarar av att förändra sig. I den här uppsatsen har författarna studerat hur Platzer Fastigheter AB har hanterat en förändring vilken syftar till att förbereda dem inför framtida utmaningar. Förändringen bestod i att de har infört nya kärnvärden, nya nyckeltal samt en ny organisationsstruktur. Dessa organisatoriska förändringar involverade hela företaget, hela vägen från ägarna via styrelsen, VD och mellancheferna ned till de anställda, vilket innebar att stora delar av förändringen kom att handla om ledarskap.

Under arbetat med den här uppsatsen har författarna genomfört en intervjuserie med nyckelpersoner på Platzer Fastigheter AB, vars resultat analyserades genom en teoretisk referensram för att författarna skulle få en djup förståelse för hur organisationsförändringen genomfördes, sett ur en ledares perspektiv. Studien visade på att länken mellan att upprätta och nå en vision är förmågan att leda en ständigt förändrande organisation. Författarna fann även att det, i den här specifika undersökningen, är mycket viktigt att ha en projektledare som har det övergripande ansvaret för att planera, genomföra och följa upp förändringen. Vidare är det viktigt att skapa engagemang samt att ha en konstant kommunikation ut mot organisationen samt slutligen att ledare måste vara beredda att anpassa sin ledarskapsstil efter de situationer som uppkommer.





Nyckelord: organisationsförändringar, ledarskap, strategi, vision, kärnvärden, nyckeltal

–  –  –

IV Preface This master’s thesis is a result of four months hard work during the spring of 2013.

The thesis is a part of the master’s program Design and Construction Project Management at Chalmers University of Technology, Gothenburg and represents 30 hec.

This master’s thesis was conducted in cooperation with Platzer Fastigheter AB, for which we are very grateful to for having accepted us as one of them and for sharing this part of their journey together with us.

We would like to address a special thanks to those who were extra involved in the contribution to this thesis by giving some of their time to share their experiences and opinions during our interviews: Ulrika Sjöswärd, Lars Backman, Andreas Theander, Agneta Timhagen-Meier, P-G Persson, Caroline Johansson and Gustaf Lindman. Also, we would like to give a special thanks to Erik Fischer who gave us the opportunity to write this thesis at Platzer Fastigheter.

Furthermore, we would like to thank: our opponents Louise Trens and Veronica Johansson, Connie Larsson and Shea Hagy for proofreading.

Many thanks also to our tutor Christan Koch at Chalmers University of Technology, for his great support and guidance throughout the process.

Thank you!

Göteborg May 2013

–  –  –

V

Introduction

This chapter presents a general background on change management with emphasis on the importance of this topic. Thereafter, the chapter will present the purpose, aim and the research questions, the delimitations as well as the disposition of the thesis.

1.1 Background It is said that the only constant is change. Changes occur in all aspects of life, from the smallest to the largest decisions and actions (Higgs and Rowland 2005, Lorenzi and Riley 2000). This is especially true for today’s businesses and organizations. It has been said that today’s business environment is changing in a fast pace (Pryor et al 2008), wherefore organizations have to quickly adapt to avoid falling behind their competitors and to prevent being caught by external forces (Tichy 1982). They have to change their business strategy to accommodate a changing environment and to be ready for what the future has in store (Burnes 2004). Also, it is vital that organizations quickly adapt to any changes to stay alert and to be better equipped when embarking on the journey towards the fulfillment of their vision (Carnall 2007).

This has made change management an important focus of today’s management strategy (Todnem By 2005). Leaders and managers have to cope with internal and external changes ranging from small-scale reforms such as employee’s job role change (Byrd and Thornton 2013), changes of the workplace location (Allard and Barber 2003), or implementing new processes or programs (Beer 2003) (i.e. as sustainability programs) (Millar et al 2012), and all the way to large-scale changes such as a major reconstructions of the whole organizations (Hayes 2010). Moran and Brightman (2001) stated that change is the process of continually renewing an organization’s direction, structure and capabilities to meet the expectations from both external and internal customers that makes an organization as successful as possible. Another vital component of organizational success is leadership (Bass and Bass 2009). Competent leaders can be the difference between success and failure, not only for the organization itself, but also for internal projects such as business or strategy development (Jacobsen and Andersson 2005). Leaders and managers have important roles to fill, such as influencing and encouraging employees that may rank from top management to lower level, regular workers in striving towards the fulfillment of the organization’s vision (Daft 2008). Gill (2002) states that the foundation of effective leadership involves defining and communicating an appealing vision of the future within an organization. Leadership during the changing process is vital for its success, but leaders must also have a specific goal to work towards (Woodward and Hendry 2004), which mostly encompass the fulfillment of a clearly formulated organizational vision, wherefore the link between setting and realizing a vision is of great interest to study.

1.2 Purpose and Aim The purpose of this thesis is to explore the link between setting and realizing an organization’s vision, with focus on the process of Platzer Fastigheter AB leading specific changes, which aims to enable them to be better prepared for the future and to take them one step closer to the realization of their vision. To better understand the events that occurred during this change, the authors frequently asked the following

questions:

What is the link between setting and realizing a vision?

• CHALMERS, Civil and Environmental Engineering, Master’s Thesis 2013:120 1 What are the most important aspects of leadership driving the changing pro cess of an organization?

The aim of this thesis is to evaluate Platzer Fastigheter AB management of this specific change event, as well as providing recommendations for future changes. Furthermore, it can be seen as a contribution to the general knowledge of how leaders manage organizational change.

1.3 Delimitations This thesis will solely focus on a specific case of a change process that occurred within the Platzer Fastigheter AB organization. There is no attempt to produce ‘the handbook of successful change’ but to document the process and relate it to the existing theories from a leadership angle.

1.4 Disposition Theoretical frame of reference – this section provides the theoretical basis for the thesis. The theories presented will describe and explain organizational strategies, leadership methods, and change management.

Methodology – this section describes the method that the authors followed throughout the process. An abductive approach was adopted, and accompanied by a series of semi-structured interviews.

Empirical findings – this section presents the empirical findings collected during the interviews. They are in raw form, as no commentary or personal reflections were involved in this section.

Analysis and discussion – this section analyzes the empirical findings and how it correlates with the theoretical frame of reference.

Conclusions – this section presents the authors’ conclusion and meets the purpose and aim of the thesis.

CHALMERS, Civil and Environmental Engineering, Master’s Thesis 2013:120 Theoretical frame of reference This part of the thesis presents the theoretical framework, which is used to understand the change process that is presented in the empirical findings. The theories presented were selected on the authors’ consensus of relevance and applicability in understanding and analyzing the specific transformation in study. The theories are found to be relevant when understanding how the journey between establishing and realizing a vision is conducted within an organization. Furthermore, the theories described reflect the different approaches frequently adopted by leaders during the change process that aim to improve the likelihood of success in the outcome of the project. The theoretical framework is divided into three parts: organizational strategic tools, leadership methodology, and change management.

The first part of the theoretical framework concerns strategic tools utilized by organizations for business development. The selected tools are the vision, core values, organizational structure, and key performance indicators. These tools were selected on the assumption that they reflect the link between the desired ends of the organization’s journey and the transfer down the organization, ending in the method regular day-today work is carried out.

The second section presents the different aspects of leadership, starting out with the distinction between leadership and management. Following is a presentation of different leadership styles that are chosen by leaders to cope with change in the most sufficient way and lead to project success.



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