Case Study 10
Initiating Cultural Transformation, Succession Plan for Business growth
The organization is in to manufacturing of surgical equipment’s since 1980. The management has imbibed the values of organization with commitment, relationship and the most important factor is “People First”. The management was run by family members and they have grown their organization from 10 employees to 150 employees in a span of 30 years. The have started deputing work to middle management and the managers have started executing work under the guidance of management members
The management has slowly and gradually started delegating assignments to managers with values and culture. As a succession plan and business growth and defining strategy to identify new business, after 3 years the management has decided to appoint a CEO for the organization and they have recruited an Indian manager who has worked in UK in one multinational company since last 20 years. He has worked at various levels in the previous organization and has a very good performance record.
The CEO has started taking charge of the activities and has a very close interaction with management members about understanding the organization culture and values. The management was quite happy with the work execution of CEO under the guidance of management for around 1 year and they were planning to make him the Director of the organization by next financial year. Later on the management has decided to give full charge to CEO to run the organization and management has decided to work on other projects.
After the charge taken by CEO, during the same financial year there were set back in the overall business and severe customer complaints which has led to a huge loss to organization in terms of revenue and image of the organization as well as there were high amount of iteration rate of employee and managers in a span of around 6 months.
The management has discussed these issues with CEO and found that there is a huge gap in thought process of CEO, managers, also subsequently down the line. They have identified a challenge in “Managing Cultural Transformation”. Management has realized that the CEO has come from the different culture and has given a good results at the beginning but his approach, attitude towards the people, customers was not satisfactory and causing the damage to organization environment and customer relationship.
Looking at the present scenario and future action plan, the management does not want to step back to reorganize the whole structure and not willing to withdraw the post of CEO as the organization was on the right track of growth and management has already made certain strategic decisions about new ventures
Finding the Facts
A study was carried with following steps:-
- Understanding the history of organization
- Understanding organization values, culture
- Understanding financial aspects of organization
- Understanding thought process of management members
- Taking one round of meeting with all level of employees (360o Review)
- understanding processes and its output
- Review present day to day function of the organization
- Validating the internal processes and thought process with culture and value of organization
- Validating strategic growth plan with organization values and culture
Followings are the root cause identified:-
The management commitment is very high and they believe in “Gain & Share” policy. They also have very good delegation ability and do not break the channel of hierarchy. The management has a very balance thought process about people and process.
There are certain empowerment issues to be handed over to CEO which was affecting the day to day work. The management has not completely handed over the operations to CEO and certain powers were retained with them and have planned to hand over gradually to CEO.
The CEO has started delegating the work to all managers in a very professional way, but the method of execution was not right. There was a human touch missing in the organization and the managers and employees were not comfortable with this kind of approach hence causing of low confidence between all team members.
Lack of synergy observed between all levels of employees.
The CEO also taken some quick actions on issues related to key customers related to product, service and financial matters without 360o review of situation. The rigidity of work and thought process was transferring in a negative approach throughout the organization. The processes were also adjusted to a tune of individual level rather than organizational level. (Lack of constructive behavior)
We have first done a series of discussion with management and understanding their requirements and strategy to run the organization. We have discussed the positive and negative aspect of the current scenario. We have discussed about the impact of the course of actions which we are going to implement to align the cultural change in the organization. With our Fact findings, it was concluded that the CEO is “RIGHT PERSON AT RIGHT PLACE”, but there was lonely issues with thought process and cultural difference. The management has decided to change the thought process of CEO by virtue of collective efforts. We have framed following strategy to implement:-
- We have formed a team including management members
- Management has started building the confidence in the employee down the line that the things are going to be restored properly
- The message of change was spread down the line quickly & publically
- One of the management members was asked to monitor the activities of CEO and identify the potential losses which can hamper the customer relationship and business.
- Other management member was asked to patch up those damages and build a record of same so that we can discuss with CEO later
- After a continuous round of meeting with CEO, first he has been made realized that due to cultural change of work execution how much impact is levied on the present business (both positive and negative).
- We have worked with CEO for around twelve months and have conducted every week one joint sessions with all managers and CEO
- Slowly and gradually CEO is empowered with all
The synergy between all levels of employee is improved. The overall business is improved in terms of revenue and growth. Customer satisfaction level is improved. The management has regained their faith on CEO, and has started heading towards new Joint Venture Company to achieve business growth.
In Today’s scenario organization face such cultural transformation issues, the organization has to focus on positive & constructive thought process, team work, and right strategy. The Organization shall be persistent and action in driving constructive behavior’s to bring the “Cultural Transformation, succession plan for Business Growth”