Managing Change for Phyllis Young

Class: HRM 587

Student:

Introduction

The two companies selected for assessment of organizational change are Apple and Nokia. Both of these companies are technology companies centered on the production of mobile technology as well as other consumer electronics as well as computer hardware and software products. The change being considered in these companies entails their production processes by which they are shifting their mainstream production into touchscreen smartphones. The move to focus on touchscreen smartphones is informed by the significant technology advancement and developments (Hamel, 2012). This in turn has led to fundamental changes in the tastes and preferences of customers such that many cell-phone buyers today prefer to buy touchscreen smartphones as opposed to traditional hardware keyboard smartphones such as those manufactured and sold by Blackberry. The following discussion therefore uses the Weisbard’s Six-Box model as a diagnostic model to help evaluate the performance of this kind of organizational change within these two companies. It also gives a SWOT analysis of associated with these organizational changes as well as identifying potential areas of resistance that these changes may yield to the respective companies going on into the future. It concludes by suggesting some recommendations to overcome the instances of resistance identified.

The Weisbard Six-Box Diagnostic Model

The proponent of this performance diagnostic model is Weisbard who cast forth this model in 1776. The main idea of this model is that an organization’s life can be broken down and categorized into six categories. These are; purposes, structures, relationships, leadership, rewards and helpful mechanisms (Skarzynski & Gibson, 2008). The purpose of an organization relates to the organization’s set mission and goals. These are the long-term strategic objectives of the company. It entails the position in which the organization views itself in the foreseeable future. Apple Inc. having been established in 1976, it envisions itself as a leading market leader in innovativeness, creativity, and beauty of its wide range of products. But even then, its major product that has guaranteed the company continuous growth in revenue sales over the past 10 years is its introduction of its iPhone brand of smartphones. Nokia also aims to be a leading global manufacturer of affordable, efficient and high-performance consumer electronic products (Lee, 2001).

The structures in this Six-Box model makes reference to the manner in which these companies are organized. Both companies are structured in accordance to products, programs and projects such that various levels of multi-skilled teams work together. This also closely borders to relationships. Relationships pertains to the way in which the various people and business units within both Apple and Nokia function and interact with each other. In this case, with the change in technology trends and consumer preferences within the market, various business units such as marketing, R&D, and operations have had to coordinate their activities together so as to successfully integrate these technology changes as key organizational changes. Relationships also refers to the way the people and units of Apple and Nokia interact with technology in their work. This has a huge bearing on the success of the departure from conventional cell-phone hardware keyboard and the transition to the adoption of touchscreen smartphone manufacturing (Cross, 2016).

Rewards refers to the intrinsic and extrinsic the employees of these two companies derive and associate with their roles. These rewards could be extrinsic as when they come from the management or just intrinsic when they simply entail personal satisfaction upon contribution of ideas and taking up risks so as to take advantages of new opportunities. The kind of reward system in place will be crucial in furthering employee innovativeness and creativity to initiate and undertake organizational changes that are meant that respond to changes in the market environment. The leadership role in Apple Inc. and Nokia is an important link to all other categories identified above. Besides the leadership playing an important role in linking the various business functions and units together, the leadership also entail championing the adoption and sustenance of whatever change within the organization (Jick & Peiperl, 2011). That is, the leadership mobilizes employee support for a given organizational change and is therefore responsible for the implementation and sustainability of the change if it is intended to yield positive results for the company. In this context, the leadership in both companies is exemplified by the company’s CEOs, Board of Directors and other senior and middle-level management staff. Furthermore, the helping mechanisms refer to the planning, controlling, budgeting and information systems that both Apple and Nokia have in place to serve to achieve their goals and objectives (Jick & Peiperl, 2011).

An equally important element in this model is the environment. This is the market environment and it focuses on the particular tastes and preferences of consumers within the market as well as trends in these preferences over time (Skarzynski & Gibson, 2008). An understanding of the environment will help augments the other aspects of the Six-Box model as explained in earlier sections of this essay.

SWOT Analyses

Apple Inc.

Strengths

Strong Brand Image: This has greatly boosted the uptake of the company’s products in the U.S as well as other new markets in many emerging economies globally. This strong brand image has been enhanced by good reputation for offering high-quality, stylish and high-performance products (Cross, 2016).

Relatively High-Profit Margins; The company uses market skimming to set and position its new products in the market. Pricing its products at a premium allows the company to experience high-profit margins (Cross, 2016).

Effective Innovation Process; Apple company invests significant amounts of its sales revenue in product research and development. Its aggressiveness in software development of its products has placed it ahead of its competitors and hence poised the company for easier adaptation of its organizational changes (Cross, 2016).

Weaknesses

High Selling Prices: This limits the uptake of its products by the low-income earning segments of the markets. As a result, the company ends up relying on only a limited number of high-end market buyers for its products and hence this may stand in the way of ensuring a successful organizational change implementation (Palmer, Dunford & Akin, 2009).

Over-dependence on iPhone Sales; the company majorly relies on the sales of its iPhones. Its iPhones make up approximately 66% of its total sales revenue every year. Should anything fundamentally change customer preferences for iPhones in the negative sense, then the company stands to experience significant loss in declined sales revenue (Cross, 2016).

Opportunities

Growing Internet of Things (IoT); the future growth in IoT places the company in a position to exploit its software platforms as well as enhance production and sale of its smartphones (Cross, 2016).

Expanding Mobile Payments Markets; this will necessitate the need of better smartphones hence supporting the need and demand for smartphones. Touchscreen smartphones will in particular attract more attention and interest from potential customers (Hamel, 2012).

Threats

Aggressive Competition: The smartphone industry is marked with tough competition from top smartphone manufacturers. Rival brands such as Samsung and Sony put pressure on the sales of the company and hence may limit the profitability of any new ventures of the two companies (Cross, 2016).

Imitation; Most of the innovations fronted by the two companies in the area of software and hardware development is often imitated by other companies. This leads to lost sales revenue in the imitated products and designs (Cross, 2016).

Nokia

Strengths

Market Experience: The company has been in the market for consumer electronics for a period of over 140 years. As a result, it is a top brand in the market for smartphones with enough resources to undertake effective product research and development as well as market research (Lee, 2001).

Wide range of Products; The company has various products that is available for all classes of consumers (Lee, 2001).

Global Expansion: The company has vast experience in venturing into other global markets. This will ease the process of introducing its new technologies in its target market (Lee, 2001).

Weaknesses

Market skimming prices of high-value smartphone sets: This eliminates all classes of consumers from accessing its products (Cross, 2016).

Less stylish in low priced Products: Most of the company’s low-priced products lack aesthetic appeal to attract a large customer base (Lee, 2001).

Opportunities

New Growth Markets: This offers great market potential for the company to expand and grow the sales of its new technologies and products (Hamel, 2012).

Increased Demand for smartphones: This offers great outlook for the demand of the company’s brand of smartphones going into the future (Cross, 2016).

Threats

Strong Competition: Nokia faces great competition from large brands such as Samsung and Apple’s iPhones (Lee, 2001).

Imitation: Nokia’s touchscreen smartphones also face stiff competition from counterfeit products from China (Lee, 2001).

In light of the above analyses, there is great similarity in the strengths, weaknesses and threats faced by the two companies. They both have strong market brands with significant market share in the smartphone market. They also face stiff competition from other large smartphone manufacturers and their products both face competition from imitated cheaper counterfeit smartphones which then eat into the sales revenue of both companies. These threats in particular will hamper the complete success of organizational challenges that both companies plan to undertake in line with enhancing the technological software of their brand of smartphones to include touchscreens.

Recommendations

With these in mind, both Apple Inc. and Nokia will need to adopt policies that will buoy them against the challenges presented by the external threats they face. In particular:

To deal with strong market coemption, both Apple and Nokia shall need to undertake actions to stay ahead of the competition. Key to remain ahead of their competitors is consistent technological enhancement of their products. By investing adequate financial and human resources to product research and development, Apple and Nokia will be able to develop desirous high-quality smartphones that will attract more customers and hence poise both companies for increased revenue sales. Further, earning reputation for high-quality smartphones will boost the company’s marketing efforts to attract and retain customers and hence build positive corporate images for both companies (Hamel, 2012).

The public agencies in charge of regulating the market for consumer electronic products in various countries in which Apple’s and Nokia’s touchscreen smartphone products are sold shall need to adopt more stringent regulations against counterfeit and imitated products. Regulation through legislation is the most effective way of mitigating competition against imitated versions of Apple’s and Nokia’s brand of smartphones. Therefore, both companies may need to rally government support so as to push for establishing clear laws and regulations towards this end (Hamel, 2012).

Conclusion

The Weisbard’s Six-Box model as a diagnostic model for the performance of organizational change categorizes the organizational life of both Apple Inc. and Nokia into six broad categories; including structures and rewards. This model assists in the evaluation of the organizational changes pertaining to the two companies manufacture, development and sale of touchscreen smartphones. However, factors such as strong market competition and imitation of their products may introduce friction into the planned organizational changes. Investment of adequate financial and human resources into product research and development will go a long way towards helping both companies stay ahead of their competition.

References

Carpenter, M. A., & Sanders, W. G. (2014). Strategic Management: Concepts and cases. Harlow: Pearson Education Limited.

Cross, S. (2016). First and fast: Outpace your competitors, lead your markets, and accelerate growth. John Wiley & Sons.

Hamel, G. (2012). What matters now: How to win in a world of relentless change, ferocious competition, and unstoppable innovation. San Francisco, CA: Jossey-Bass.

Jick, T., & Peiperl, M. (2011). Managing change: Cases and concepts. New York: McGraw-Hill/Irwin.

Lee, S. (2001). Nokia: strategic transformation and growth. Seoul: School of Public Policy and Management. Pearson Education.

Palmer, I., Dunford, R., & Akin, G. (2009). Managing Organizational Change (2nd Ed.): A Multiple Perspectives. Elsevier Press.

Skarzynski, P., & Gibson, R. (2008). Innovation to the core: A blueprint for transforming the way your company innovates. Elsevier Press.

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