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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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1. Position power: The ‘players on the board’ were clearly the board and especially the middle management. Some of the members of the board did not follow, but the empirical findings do not show any attempt to block the process by those who were left out.

2. Expertise: It was clearly extracted by the empirical findings that the CEO ‘invested’ on certain members of the board. These members were believed to have the expertise to carry out the organizational change in the best way. One of the reasons of the change as believed by the authors was to ‘prepare’ certain individuals in the middle management, to take higher leading posts when the company has grown in size.

3. Credibility: The group had clearly enough people with good reputations in the company circles as the empirical study shows. These individuals were in a firm position to decide and implement the change.

4. Leadership: The leaders of the group were proven leaders and the CEO had big trust for them. As the results show, the CEO was right on his decision.

Which style of leadership was used throughout the process? In the theoretical background were presented different styles of leadership. The authors believe that the most used styles of leadership throughout the process were the transformational and the transactional.

Attempting to draw a picture of the leadership profile of the CEO the following can be


Emphasizes on delegating responsibilities top-down. One of the purposes of • the restructuring of the organization was to spread the responsibilities in a more orderly fashion and attempt to point out the persons that could potentially take up a leader role.

Comparing to predecessors, the current CEO does not focus on the details too • much. There is no close control and the employees do not perceive being under close surveillance. Nevertheless, there was one interviewee that noted that the CEO is much more into details than expected.

Keeps open communication channels with all the employees but is not consid ered easily approachable. This however does not seem to be negative for the employees.

As the CEO narrated his leadership is characterized by the two-year decision • horizon. Every decision he makes is ‘filtered’ by that.

The leadership styles are changing constantly depending on the context as the • CEO narrated.

Believes that the leader should listen to the co-workers.

• He does not see a change leader and a normal leader as two different persons.

• The leader is a leader at all times.

The CEO also believes in a close cooperation with the middle management.

• In the theoretical background the authors presented the Theories E and O. After the collection of the empirical results, there was an attempt to identify where the leaders of Platzer regarding those theories are. Taking the dimensions of change as presented

by Beer and Nohria (2000) one by one:

CHALMERS, Civil and Environmental Engineering, Master’s Thesis 2013:120 43 The goals of the change explicitly embrace the paradox between economic value and organizational capability. Some employees believe that the CEO’s leadership is focused on the economic aspects but the empirical findings show that it is a combination of those two.

When it comes to the Leadership as a dimension of change, the tactics followed were clearly theories E and O combined. This means that the direction was set from the top and engaged the people below.

Moving on to the next direction of change, namely the Focus, Platzer lies on the combination of the two theories. As Beer and Nohria (2000) suggest, the combination of the two theories in this case signals focus simultaneously on the hard (structures and systems) as well as the soft (corporate culture).

Next follows the Process as a dimension of change. Platzer find themselves again on the two theories combined, since the plan was not strict and immobile from the first day. On the contrary, it was a plan for spontaneity, demonstrating the flexibility of the leadership of the company, as well as the ease of the employees to accept the change.

The employees appreciated this spontaneity and the results show that it had a positive effect on the process as a whole.

The Reward System was not found in any of the dimensions of change. The employees did not receive any reward of any type that was related to the change. The CEO and most of the interviewees believe that this was not necessary. In this point it should be noted that the leadership attempted to keep the change as a part of the everyday routine in the company. Regarding this aspect, they did not believe that this event required any kind of reward. However, the company has already a reward system when it comes to operational goals. A surprising demonstration of engagement to the process by the employees was that some of them believe that the best reward was that their work was made easier and more effective. This demonstrates that the employees have embraced the leadership’s attitude towards rewards.

The use of consultants is correlated to the previous factor in Platzer’s case. The CEO as well as most of the employees interviewed, believe that the use of external consultants was not necessary. Not only it would not affect negatively the process, but it would also raise the internal involvement of the employees as well as their engagement to the process, according to the CEO. As mentioned in the empirical section, this process was a ‘product’ of the company itself something that makes it more selffulfilling to them.

3.3 Change management The transition model made by Nadler and Tushman (1997) is very representative when describing the journey that Platzer was taking. They have a stated vision that they want to reach, wherefore they have identified that certain changes of the current organization have to be made. Both the CEO and the middle management, but also the employees stated that they all were aware of that the current organization was not functioning in the way that they wanted. During the interviews we have found that the CEO has planned this change for a long time, almost a year before the implementation started. The CEO informed the board about his plans, and they started to plan for how they want the organization to be in a future state. The planning phase was extensive;

they spent many hours identifying where they were now and what has to be changed.

During this process, when the board had come up with new core values, new KPIs and a new organizational structure, there were several changes within the board, with CHALMERS, Civil and Environmental Engineering, Master’s Thesis 2013:120 some old members leaving and some new members joining the coalition. This had both positive and negative impact, as we have found during the interviews. The positive side is that the board has a stronger focus on what has to be achieved in the future and also being seen as more representative of the organization. The number of people within the board was also reduced, which created shorter communication paths and faster meeting procedures. The negative side was the timing of the change, which was right during the planning phase of the new organization, creating a vacuum in where the old group had planned and developed the new organization and the new constellation had to implement it. Another aspect is that the new group had new ideas and were not stuck in old habits. Our suggestion would be that the change of the board should have been before the whole planning processes had started; nevertheless we do not find that the timing was harmful to the organization.

The motivation behind this change can be seen in Figure 15. The organizational change was used as a vehicle, which guided the organization from the old status quo to the new desired vision components.

Figure 15 Reaching the desired vision components

The previous status quo as well as the desired vision are ‘instant pictures’ of the organization in certain times. As mentioned in the theory, change is a constantly fed back process which moves on a continuous loop. What is the way to achieve these desired vision components from a leadership perspective?

All the previously mentioned theories in combination with the empirical findings are landing to a total of ten steps. Some of these steps were followed by the company and some others were not. The authors’ understanding of a succesful and sustainable transition leads to the following ten steps.

CHALMERS, Civil and Environmental Engineering, Master’s Thesis 2013:120 45

1. Identify and understand why and what shall be changed: The need for change was generated by the fact that the company is on a fast growing pace. The old structure and the old way of work could not continue existing in the company.

The CEO and some members of the board understood that and set the scene for the change.

2. Establish a sense of urgency: This element was not really met by the empirical findings. The truth is that the company was not in a critical situation that would require change. The board neither created this emergency artificially. It can be said that this element was in some part absent from the process.

3. Encourage people to join a guiding coalition and assign a project leader i.e. a change agent: The CEO created a guiding coalition that would drive the change and ‘stepped back’ in the process. This guiding coalition though had no ‘project leader’ or ‘project owner’ who according to the literature could be responsible for the process.

4. Develop a change vision and common goals for what to achieve: The board of directors set the vision and the CEO developed the common goals. These common goals broke down to KPIs and individual goal settings. Almost all the employees had a clear picture of where the company should be in a few years.

5. Create a detailed change plan: The change was conceived in the spring of 2012 and the planning began in the following summer. The CEO gathered the members of the board who were positive towards this change and created the guiding coalition, which was mentioned above. The planning was not detailed, as it had a spontaneous character, which was argued to make the change more flexible. As a result of this, and also the absence of a project leader, there were severe lead times between critical events, which somewhat created anxiety within the organization.

6. Communicate extensively about the change and what’s happening in the process: The change was communicated both formally and informally. The guiding coalition communicated the change in a satisfying manner but there were still misconceptions and misunderstandings.

7. Empower employees to act on the change: The empowerment is tightly connected to the sense of affiliation established by the board. Some employees felt affiliation to the process and some others not. It has to be mentioned that in general terms the change was applied by the board and not by the rest of the employees.

8. Create short-term wins: The empirical findings do not show any attempt by the guiding coalition to create short-term wins. This however did not seem to affect the well-being of the process in a significant manner. Nevertheless, we have identified that the interviewees said that their everyday work has been much easier as a result of the change, which is to be seen as a short-term win.

9. Reinforce and refine the change in order to sustain it and not lose momentum:

The guiding coalition attempted to reinforce the change by producing the new core values along with the employees. However except for this ‘soft’ side of reinforcement, there were no empirical findings to support an effort to reinforce and refine the change. One thing that was reported to be missing for example was a detailed description of how the employees shall do their work, and what responsibilities they have, after the change.

10. Consolidate and produce more change: The empirical findings did not locate any attempt of consolidation probably because these lines were written during the last stages of the organizational change, when the process did not really CHALMERS, Civil and Environmental Engineering, Master’s Thesis 2013:120 ‘settle down’ yet. There have been tendencies (KPIs), which show that the consolidation of the change is under way. Also, the members of the organization were aware of that this is not the last change that will happen, wherefore they can be said to be part of the culture of readiness for change and continuous improvements.

Having good leaders and talented managers throughout the process is not enough. The organization is not a static entity; it belongs to an ever-changing context, which isolates organizations that are static. Therefore an important component of the process is constant learning as described by Senge et al. (1999). This environment, of organizational learning and continuous improvements, together with adaptable leadership creates organizational success. By examining the steps mentioned above as well as the model of Dunphy-Stace (1993), there is a possibility to identify the level of change that will occur. This is of great importance since it will give by hand what amount, and type, of leadership that must be applied on the change process in order to manage it in the sufficient way. In this case, it can be stated that the organizational change level of Platzer lies on Type 3 of the matrix as shown in Figure 16. In Platzer’s case the change was not a groundbreaking event but an incremental adjustment. As the empirical findings suggest, Platzer is on a constant changing pace and this change was one bigger event of this procedure. The style was not collaborative, neither consultative. It was directive since it came as a direction from the board. The employees were not really involved in the definition of the final product. In the beginning of the process, all the interviewees believed that the change was not that significant. However in the next rounds of interviews the middle management started to realize that the change was bigger than anticipated while both the CEO and the employees still believed that the change was smaller. Therefore the impact of the change became bigger than planned. We base this assumption on the fact that the middle management perceived that the employees were affected by the change on a bigger extent.

Figure 16 Identification of the level of Platzer’s change

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