Analysis of the changes implemented in the Stanley Australia

By | May 1, 2014

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I. Introduction

In this essay, we will use the open system model to analyze the changes implemented in the Stanley Australia referring to the aspects of people, process, structure as well as the technology by taking full consideration of the issues such as the change, globalization and the sustainability related in the transformation period.

II. Open system model

According to Cummings and Worley (2009), open system model is built on the basis of the theory of open system, which regards the organization as a unit which has relatively frequent interaction with the external environment instead of being a closed and independent unit.

In the change process of the Stanley Austria, we can first define these inputs invested by this organization to support the change process via interacting with the external environment to produce its expected outputs.

T begin with, we will investigate and analysis the transformation practices carried out by the Stanley Austria from three levels based on the suggestions from Cummings and Worley (2009) such as the organizational level, group level as well as the individual level.

Secondly, with reference to the organizational level, (see figure 1.0), the inputs invested by the Stanley Australia explored by us will include elements such as the general environment in the industry it engaged in and the industry structure with relatively specific analysis on these changes such as technology, strategy, structure, human resource system as well as organizational culture in Stanley Australia. And then based on the analysis of the interaction between the inputs at the organizational level and the external environment, we will then evaluate the outputs produced by the inputs in the field of organizational effectiveness for the Stanley Australia such as the performance, productivity and so on (Cummings & Worley 2009).

Figure 1.0 Organizational level system diagnosis

Source: Cummings, T. G. & Worley, C. G. 2009, Organization Development and Change, 9th edn., South-Western Cengage Learning, Ohio,

Thirdly, we will also explore the group level of the changes implemented in the Stanley Australia to assess its inputs namely the organization design in fields of the task structure, goal clarity, and team functioning and so on (see figure 2.0). And then we will evaluate the outputs such as the team effectiveness produced by the interaction between the inputs in the group level with the external environment to estimate the value of the change in the Stanley Australia (Cummings & Worley 2009).

Figure 2.0 Group level system diagnosis

Source: Cummings, T. G. & Worley, C. G. 2009, Organization Development and Change, 9th edn., South-Western Cengage Learning, Ohio,

Furthermore, changes in the individual level will also be evaluated by the investigation on the interaction between input elements such as group design, personal characteristics and so on with the external environment to assess the value of the inputs for the individual effectiveness in Stanley Australia (Cummings & Worley 2009).

Figure 3.0 Individual level system diagnosis

Source: Cummings, T. G. & Worley, C. G. 2009, Organization Development and Change, 9th edn., South-Western Cengage Learning, Ohio,

III. Evaluation on changes at organizational level

i. Inputs: general environment & industry structure

General situation on the environment and organizational structure

First all of, let’s take a close look at the external complexity faced by Stanley Australia and its original organizational structure. In terms of the external situation, the fierce competition faced by Stanley Australia became more and more obviously. For instance, with the great improvement and development of the manufacturing techniques, the product quality of Asian manufacturers began to be close to that of Stanley in the Australia market but with much cheaper price. Under such kind of situation, many original customers of Stanley Australia began to choose to import these Asia makers’ products rather than continuing to purchase from Stanley Australia from the early 1990s, which resulted in great loss in both market share and customers for Stanley Australia.

Besides, the original organizational structure for the Stanley Australia was also rather divisional alike as in figure 3.0. For instance, in the previous time, there were two independent firms owned by the Stanley Company in Australia region namely the Stanley Australia and Stanley Bostitch, which operated respectively.

Figure 3.0 Original structure of Stanley Australia

Problems

Just from the statement in the environment situation and previous organization structure faced by Stanley Australia we may conclude that there were several problems encountered by this company. On the one hand, due to the market losing resulted from fierce competition from Asian competitors, it was in urgency for management in Stanley Australia to take immediate action. On the other hand, effective measure to promote changes should also be carried out to meet the environmental challenges.

ii. Interaction between inputs and external environment

Changes in organizational level

To meet these challenges from the environment, Stanley Australia had carried out series of changes at the organizational level.

i) Human resource strategy changes – people and the related process

The first change implemented by Stanley Australia was in the human resource management area that this organization had cut down about 300 employees redundant from the lower level job position to senior level job position. On the one hand, the replacement of the CEO in Stanley Australia was to set up a relatively solid sales and marketing orientation. On the other hand, assistant measures were also implemented to facilitate the downsize practice in order to reduce resistance from employees such as offerings of outplacement and financial advisory services, grief-counseling services, gift vouchers, two weeks’ sick leave payment and volunteer programs and so on.

ii) Changes in organizational structure and the related process

Another change implemented by Stanley Australia at the organizational level was the change in the organizational structure. To both save cost and remove the pressure from fierce competition, Stanley Australia merged the Stanley Australia and Stanley Bostitch in the year of 1997.

iii) Changes in culture and the related process

Stanley Australia also positively promoted the changes in the organizational culture. For instance, it concentrated on developing a more positive organizational culture encouraging and promoting the participant level of decision making, the process for employees in enhanced involvement in team activity as well as communication and so on.

iv) Changes in technology and the related process

To be better fit for the requirement of the external environment on modern technology employment in order to improve the competitiveness compared to other competitors, Stanley Australia injected its organizational process with more advanced technologies which continuously emphasized the importance of IT system to its organizational process than the previous time.

iii Evaluation on output

Based on the above analysis on both the areas of the input elements and interaction between the inputs and the external environment namely the changes at the organizational level for Stanley Australia, we will then evaluate the effectiveness level of the produced outputs within the organizational level.

i) Evaluation on the fulfillment level of requirements from globalization

First of all, we may point out that the changes implemented by Stanley Australia at the organizational level may partial meet the requirements of the globalization, which is defined as the inexorable integration of markets, countries, and technologies in a way that enables working staffs, companies as well as countries to reach around the global market in a farther, quicker, deeper and cheaper level than before (Griffin & Pustay 2010).

Secondly, some of the changes implemented by Stanley Australia enable this organization to be much easier to globalize itself in the future. For example, Stanley Austria had merged it two companies –the Stanley Australia and Stanley Bostitch to make the newly built company own more comprehensive competitiveness in both the areas of hand tool making and fastener making. Therefore, both lower level employees and senior level managers had to develop more comprehensive and mix skills and professional knowledge than before, which is just to meet the need of globalization on technological improvement (Doh 2009).

Thirdly, the higher level of IT technology utility in the organizational process of Stanley Australia due to the changes also improve the entire productivity and effectiveness level of this organization compared to the previous time, which makes this company become more competitive to meet the fluctuant requirement of customers whose rang of choice are enlarged in a global region under the motivation of globalization (Ball et al. 2006).

ii) Evaluation on the fulfillment level of requirement from sustainability

Thanks to the the higher level of IT technology utility in the organizational process of Stanley Australia resulted from these changes, this organization is able to save a lot of time and energy so as to realize the sustainable development of this organization in the future.

iii) Negative aspect

While, there are also some negative influence of the changes at the organizational level for Stanley Australia. On the one hand, although the present organizational culture of Stanley Australia is fostered to be more competitive, the original corporate culture in Stanley Bostitch was more laissez faire alike and the original corporate culture in Stanley Australia was more traditional. Therefore, after merging the two companies, the conflicts of the two kinds of culture may take place, which may both influence the globalization and sustainable development speed (Ashraf & Galor 2007).

IV. Evaluation on Changes at group level

i. Inputs: organization design

At the group level, Stanley Australia invests a lot to produce expected results including the design of the task structure of its employees in this organization, clarifying the goals for change, design the team function and so on.

ii. Interaction between inputs and external environment

At the group level, Stanley Australia has also devoted a lot to improve the effectiveness of its working group by actively promoting the interaction between these inputs such as the task structure, goal clarity, and team function with the external environment.

As the above mentioned, the most urgent situation for Stanley Australia to manage due to the pressure from the external environment especially the fierce competition from Asia makers is to improve the competitiveness as well as save cost for Stanley Australia. Therefore, besides the efforts made at the organizational level, changes are also carried out at the group level in Stanley Australia.

i) Changes in task structure and function- technique and people

Firstly, in the previous time, Stanley Australia focused on manufacturing industry. While changes has been implemented on the task structure which focuses more on overseas purchasing instead of the domestic manufacturing now in this company. The most obvious point is that the ISO 9001 was changed to the ISO 9002. It shows the technique employed by this company in Australia has been changed from design to more focus on the installment and service of the products (McAdam & Canning 2001)

Secondly, as the task design in Stanley Australia has changed, the actual job content for working groups in this company has also been adjusted. On the one hand, for these working groups, their responsibilities have been changed to focus more on purchasing, forecasting and planning rather than designing. On the other hand, for the management group, task structure is also redesigned. The marketing department in Stanley Australia for instance, the original managerial position was divided into two to more concentrate on specific tasks including mechanics and tools.

ii) Changes in goal clarifying- process

To actual implement the changes and make people accept the fact, Stanley Australia has clarify its objectives in Changes. For example, Stanley Australia showed its concern and respect on these staffs that may lose their jobs that it informed them the changes would happen in Stanley Australia before the official announcement to the media, which was aimed to make employees know what would happen and why they would occur.

iii. Evaluation on output

Evaluation on the fulfillment level of requirements from globalization and sustability

pros

On the one hand, these changes have produced a series of advanatges for Stanley Australia to meet the trend of the globolization. Firstly, the adjustments on task strcuture and function for its working groups enbale these groups to be more capabale to meet the challenges and catch opportunities in the Australian market when compared to the international competitors. Secondly, it also enables Stanley Australia to act more flexibly. For instance, the task structure changed from focusing more on designing to concentrating more on purchasing, installing and serving for customers may be more fit for the market situation at the present time to assist Stanley Australia to save more cost and compete more confidently (Jovane, Westkämper & Williams 2008).

Thirdly, in the aspect of sustainable development, this transformation especially on the task structure may be fit for the requirement more. As the price and quality advantages owned by Stanley Australia’s products compared to these Asia competitors become smaller and smaller, the stubborn insistence on product designing as before may only cost Stanley Australia much while bring smaller and even negative returns. Hence, to focus on the purchasing, forecasting and planning may be wiser to both save source of energy and cost to support the sustainable development for Stanley Australia (Jovane, Westkämper & Williams 2008).

Cons

First, the time and efforts made by teams to meet the new requirements of the task strcuture and function may be spent a lot (Jovane, Westkämper & Williams 2008).

Secondly, the purpose of the redesigned task strcuture or function for different groups in Stanley Australia is aimed to improve the team effectiveness, there are also many conflicts and great pressures on these teams to meet the new needs and requirements, which may cost Stanley Australia a lot of time and energey to remove these problems (Jovane, Westkämper & Williams 2008).

V. Evaluation on changes at individual level

i. Inputs

The inputs in the individual level invested by Stanley Australia include three parts such as the organization design, group design as well as individual design.

Firstly, the organization design and group design we have discussed above, which are all aimed to improve the performance and effectiveness of both the organization and the groups in Stanley Australia.

Secondly, with reference to the individual design aspect, Stanley Australia mainly focus on the skills and job content enrichment and adjustment to fit for the requirement of the external environment, which we will explain thoroughly in the following.

ii. Interaction between inputs and external environment

In Stanley Australia, when the merging of Stanley Australia and Stanley Bostitch took place, there were two kinds of situation faced by employees. For one thing, employees who were seemed to lack the necessary skills and experience were often sacked by their employer. But there were some lay-off assistance offered to these employees in Stanley Australia such as outplacement and financial advisory services, grief counseling network as well as a considerate gift voucher to reduce their resistance and facilitate them to be more flexible and capable to find future careers.

For the other, towards these remaining employees, Stanley Australia both offers them with incentives to remain at work as well as maintain performance and pressures such as more mixed job required skills to better meet the requirement after the merging of the two companies.

iii. Evaluation on output

Pros

Firstly, although to both mollify these layoffs and retained employees ask for a cost, under the skillful management, Stanley Australia have controlled the cost within the constraint of the target budget, which proves its effectiveness in change management at the individual level.

Secondly, the absenteeism has been controlled about 3% which also indicates that all of these efforts made by Stanley Australia to maintain the normal performance of retained employees have created expected results.

Cons

As almost all of these retained employees faced with changes in their job content and task structure, there were higher requirements on their job performance which gave employees greater pressure and tougher working environment.

Secondly, some employees even asked to afford these working loads which they were so unfamiliar with, which may also result in the customers or market losing for Stanley Australia as well (Cummings & Worley 2009).

VI. Conclusion

There are many outstanding aspect performed by Stanely Australia in manage its change in the people aspect, cultural aspect, technique aspect as well as the structure aspect, which had better be maintained in the future.

At the same time, there are also some weak points still requiring Stanley Australia to make more efforts to conquer.

Therefore, we recommend this company to develop thorough understanding on the external environment and internal environment especially these stakeholders including customers, employers, suppliers, business partners, shareholders and so on, and then come up with more effective and win-win strategy when it plans to make changes in the future (Palmer, Dunford & Akin 2009).