Management Team
Different level of Managers of Beximco pharma was highly responsible for implementing the
changes on their business successfully. Manager’s responsibility was to control and motivate the employees on the basis of change. Moreover, managers took different decision, such as helps to reduce the waste level, maintain the stock properly, minimised the administrative cost for example, previously Beximco pharma used to give any official conveyance and travelling cost for every employees but during the recession the company left this rule. The benefits were allowed for only those employees who were not using the company car.
Suppliers
Suppliers are very important and powerful stakeholder. Suppliers helped the company by providing raw materials for medicine on credit and sometimes with less cost. Additionally, Beximco pharma introduced some inexpensive medicine products in the market during the recession and cut the price of some existing products. Beximco pharma continuously pressurised and finally managed its suppliers to introduce the inexpensive materials for the existing medicines so that they can minimise the prices of the products. Besides, suppliers provided the delivery on time so that Beximco can operate its business smoothly.
Customers
Customers are also involved in Beximco pharma’ s change process. If there was no customer, the company change process would not be successful. Beximco temporarily stopped the production of some expensive medicines for first two three months from their list and customers was positive. Furthermore, Beximco newly introduced substitute medicines were highly accepted by customers and thus the change process of Beximco Pharmaceuticals Ltd became successful.
3.1. Change Process
According to Mullins ‘most planned organisational change is triggered by the need to new challenges or opportunities presented by the external environment, or in anticipation of the need to cope with potential future problems, for example, intended government legislation, a new product development by a major competitor or further technological advances. Planned change represents an intentional attempt to improve, in some important way, the operational effectiveness of the organisation’. Moreover, organisational change is necessary to match with the current situation of the business environment and economy. For example, during the recent recession all over the world, most of the large companies implemented change to match with the economy and retain the previous sales level. Besides, the change of Tesco, Proctor & Gamble (P&G), Marks & Spencer (M&S) and McDonalds’s business policy are mentionable.
3.2. Why Changes Needed and the Ongoing Changes in the
Organisation
‘Established companies should not undertake business-model innovation lightly. They can
often create new products that disrupt competitors without fundamentally changing their own business model. Proctor & Gamble, for example, developed a number of ‘disruptive market innovations’ with such products as the swiffer disposable mop and duster and Febreze, a new kind of air freshner. Both innovations built on P&G’s existing business model and its established dominance in household consumables’ (Johnson et al., 2008). Johnson et al.(2008; pp.-57) also added that the following circumstances can require a change in the business model:
∙ If there is an opportunity to address through disruptive innovation the needs of larg groups of potential customers who are not buying the existing alternatives due to high price. For example, Tata introduced Nano to provide cars to satisfy the customer needs with a low cost where there are a lot of alternative which are expensive.
∙ The need to fend off low-end disrupters. If the Nano becomes successful other
automobiles company will be threaten by Nano.
Furthermore, the following basic underlying objectives can be considered as the reasons for
change in an organization:
∙ ‘Modifying the behavioural patterns of members of the organization.
∙ Improving the ability of the organisation to cope with changes in its.
In addition, ‘ACAS refers to initiating and maintaining a Quality of Working Life (QWL) change programme. Such initiatives could stem variety of issues that might provide a window for a change to management and or worker representatives. Change includes the following factors:
∙ A general sense that the organisation could perform better;
∙ The need to improve organisation flexibility, quality or to develop new customer concern,
∙ A sense that skills and abilities of people are under-utilised or concerns about a lack of commitment from employees,
∙ The need to introduce changes in technology or working practices,
∙ Workers feeling over-controlled by supervision or by the process or jobs seen as being boring;
∙ Concerns about ineffective communications or poor performance indicators;
∙ Fractious relationships between managers and the managed.
3.3 Changes in Beximco Pharma Ltd.
Changes for any organisation start from its some factors which consists people, products,
place, services and organisation goal. Beximco pharma normally focused on people and
products. The company changes for people and products are shown below:
Changes of People in Beximco Pharma
Beximco pharma trained the existing employees to increase the productivity and work under
pressure to cope with the changes exists on the economy. Moreover, the company also focused on employees work efficiency and effectiveness by observing their work continuously. In addition, Beximco pharma trained employees as per the requirements of changing economy. For example, Beximco pharma sent 57 of its employees to Singapore to
learn the techniques of cheapest medicine production.
Changes of Products in Beximco Pharma
Beximco pharma introduced two three new products to increase the sales of the company
under the slow-down economy of the world including Bangladesh. For example, Beximco introduced low-cost products including CFC inhalers with low cost, and introduced first time cardio-vascular products for Bangladesh namely Amdova, Atova 40, Bizoran and Olmesan
with comparatively low cost than other international cardio-vascular products in 2009 to attract more customers during the undergoing economy. To attract more customers for the new products are one of the common techniques which are used by international giant company like McDonald’s, Vodafone mobile company etc.
3.4 Models of Planned Change
Conceptions of planned change have tended to focus on how change can be implemented in organizations called theories of changing; these frameworks describe the activities that must take place to initiate and carry out successful organizational change’ (Cummings and Worley, 2009; p. 23). There are few models which normally are used to ensure the ongoing change in the organisations.
1. Lewin’s Change Model,
2. Action Research Model,
3. Kotter’s Eight-Step Model,
4. Eckes Model,
5. General Process Model (Organisational Development).
6. The Positive Model.
Lewin’s Change Model has been described below:
3.5 Lewin’s Change Model
Kurt Lewin’s (1950) three stages change model is one of the earliest models of planned change in the organisations. Lewin imagined the change as a modification of those forces keeping a system’s behaviour stable (Cummings and Worley, 2009). Additionally,Cummings and Worley, (2009; p. 23) stated that, ‘specifically, a particular set of behaviours at any moment in time is the result of two groups of forces those striving to maintain the status quo and those pushing for change. When both sets of forces are about equal current behaviours are maintained in what Lewin termed a state of quassi-stationary equilibrium. To change that state, one can increase those forces pushing for change, decrease those forces maintaining the current state, or apply some combination of both’. Lewin argued that a successful change project involved three steps (Burnes, 2009), which are given below in a figure:
3.5.1 Unfreezing
Lewin believed that the stability of human behaviour was based on a quassi-stationary
equilibrium supported by a complex field of driving and restraining forces .Moreover, Mullins (2007; p. 736) mentioned that unfreezing ‘reducing those forces which maintain behaviour in its present form, recognition of the need for change and improvement to occur’. Beximco pharma used this unfreezing method to mention the necessity of the change and improvement to occur.
3.5.2 Movement
Movement is the ‘development of new attitudes or behaviour and the implementation of
the change’ (Mullins; p. 736). Besides, ‘this step shifts the behaviour of the organization,
department, or individual to a new level. It involves intervening in the system to develop
new behaviours, values, and attitudes through changes in organizational structures and
processes’ (Cummings and Worley)
Beximco pharma used movement to take necessary action towards the change and steps
to implement the change process within the company smoothly.
3.5.3 Refreezing
According to Cummings and Worley (2009; p. 24), ‘this step stabilizes the organization at a new state of equilibrium. It is frequently accomplished through the use of supporting mechanisms that reinforce the new organizational state, such as organizational culture, rewards, and structures’.
Beximco pharma refreeze the organizational culture, rewards, and structures for the company to cope with the change process. The company changed its salary structure since
the company profits increased but other administrative costs increased.
Lewin’s model provides a general framework for understanding organizational change.Because the three steps of change are relatively broad, considerable effort has gone into elaborating them (Cummings and Worley).
3.6 Evaluation of Change Model
The change model evaluation involves evaluating the effects of the intervention and managing the successful change programs as they exist. Feedback from organization members about the intervention’s results provides information about whether the changes should be changed, continued, modified or suspended. Organisational successful changes involve reinforcing them through feedback, rewards and training. In real practice, the different phases of change models are not nearly as orderly as the model implies. However, the steps of change models can be implemented in a variety of ways, depending on the customer’s needs and goals, the change agent’s skills and values, and the organisation’s context. Therefore, the planned change situation can vary from one situation to another. For example, Marks & Spencer (M&S) observed that customers were not feeling comfortable in its store and the store needs a comfortable environment where customers can feel comfortable (Rose, 2007). Moreover, Rose (2007) added that, the company took the initiative to refurbish the store for retaining customers and finally the company regained the stride in advertising and marketing as well. Beximco pharma’s change in operation system during recent recession was successful.The company annual report (2010) shows that the company earned a profit of 311, 024,000 taka during the year. Beximco emphasised on price-focused approach to retain customers and increased the number of products all over the Bangladesh. Moreover, the company focused on customer value propositions which enabled the company to offer low-cost products with 100% quality and good service. According to Johnson ‘many companies begin with a product idea and a business model and then go in search of a market. Success comes from figuring out how to satisfy a real customer who needs to get a real job done’. Beximco was able to satisfy the customers’ actual demand with a low-price. Thus, the company change was implemented successfully and gained more profit than the previous year. Therefore, Beximco pharmaceuticals ltd. was a successful company for its successful implementation of change process during the recession.
4.1. Key Issues of Change Process Implementation
According to Johnson et al, the key issues for successful implementation
of change process are as follows:
▪ ‘People,
▪ Technology,
▪ Products,
▪ Facilities,
▪ Equipment,
▪ Channels, and
▪ Brand required delivering the value proposition to the targeted customer’.
4.2. Recommended Change Model for the Beximco
Beximco can use the Kotter’s Eight-Step Model to do change in the company. A brief discussion about the model is given below from the perspective of Beximco:
Kotter’s Eight-Step Change Model
‘A popular model for planning, implementing, and sustaining change is the Eight-Step Change Model by John Kotter (1996). The Kotter model breaks down the organizational change process into eight steps’ (Sabri et al., 2007; p. 176):
Step 1: Establish a sense of urgency.
Step 2: Create a guiding coalition.
Step 3: Develop a vision and strategy for the specific change,
Step 4: Communicate the vision and strategy for the specific change,
Step 5: Empower the employees for action,
Step 6: Generate short-term wins,
Step 7: Consolidate gains and produce more changes,
Step 8: Anchor the new changes in the culture.
Step 1: Establish a sense of urgency
Kotter (1996) believes that the crucial first step in any change effort is to establish a sense of urgency. To get the attention and commitment of the organisational managers, the change leader must convince busy managers of the importance – the urgency – for the change. Beximco top level management needs to explain to CEO about the importance of change necessary to match with the recent economic situation.
Step 2: Create a guiding coalition
Beximco transformer needs to convince the lower level employees to higher level managers
to implement a change within the company.
Step 3: Develop a vision and strategy for the specific change
According to Kotter (1996; p. 68) ‘vision refers to a picture of the future with some implicit
or explicit commentary on why people should strive to create that future. He also added that,in a change process, a good vision serves three important purposes. First, by clarifying the general direction for change, second, it motivates people to take action in the right direction and thirdly, it helps coordinate the actions of different people’. Beximco transformer should develop the vision and specific strategy to achieve that vision and the area where changes needed before planning to implement the change process in the company.
Step 4: Communicate the vision and strategy for the specific change
‘A great vision can serve a useful purpose even if it is understood by just a few key people’ (Kotter, 1996; p. 85). In this stage, Beximco transformer needs to share the vision and specific strategy to achieve that vision with higher level of managers and the area where change is required.
Step 5: Empower the employees for action
‘Effectively completing the stages 1 through 4 of the transformation process already does a
great deal to empower people. But even when urgency is high, a guiding coalition has created an appropriate vision, and the vision has been well communicated, numerous obstacles can still stop employees from creating needed change’ (Kotter, 102; p. 102).
The transformer of Beximco needs to allow the employees to take appropriate actions toward the change process.
Step 6: Generate short-term wins
A new plan for create and reward short-term wins that push the organisation toward the new
vision. At this stage, the transformer of Beximco should define the results of changes on the shortterm basis and rewarding so that employees become more motivated and push the company toward achieving the new visions.
Step 7: Consolidate gains and produce more changes
In this stage, the organisation consolidates improvements, re-evaluate changes, and make
necessary adjustments in the new programs. Beximco should re-evaluate the change process and if there is any adjustments required should be adjusted to implement the change process effectively.
Step 8: Anchor the new changes in the culture
In this stage, after successful implementation of change process, organisation decides to fix
the change process for the long period of time. Besides, the company reinforce the changes
by demonstrating the relationship between new behaviours and organisational success.
4.3 The source of individual resistance to change:
The individual resistance has a great impact on change. It includes selecting information
process, fear of the unknown, security, economic factor and habit.
Economic factor:
Economic factor that can affect the company change process. If the company makes any loss the company economic condition will be weak and the change process will be hindrance.
Habit:
Human nature is to put complain to anything at the beginning of the action. In the change
process people make complaints against the change thus they can hindrane the change
process.
Relationship:
People resist the change because of afraid of the familiar contact with people like customers ,co workers or managers can disappear and afraid of losing their sense of belonging to a team or group.
Fear of the unknown:
Fear is one of the sources of resistance. Unnecessary fear is acting on the change process. In the beginning of the innovation of the computer in many organization people were afraid of to use computer – a sophisticated machine. It comes from the fear of unknown.
Security:
Employee does not want any change inside the organization and or any department. They are conscious about their life and family entity as well. Therefore, the people feel that if there is any change in the organization they will be unsecured.
4.4 Organizational Resistance to Change
To ensure operational effectiveness, organizations often set up defenses against change and prefer to concentrate on the routine things they perform well (Mulllins, 2007). Factor of organizational resistance to change are as follows
∙ Organizational culture
∙ Threat to establish power relationship
∙ Threat to establish resource allocation
∙ Structural inertia
∙ Limit of focus of change
∙ Group inertia
∙ Threat of expertise
4.5 Overcoming the resistance to change of Beximco Pharma
In the implementation of change process management of Beximco pharma should overcome any degree of resistance to change immediately. The tactical for dealing with the resistance to change ( Burnes, 2009) are as follows:
▪ Education and communication
▪ Participation
▪ Facilitation and support
▪ Negotiation
▪ Manipulation and cooperation
▪ Selecting people who accept change
▪ Coercion
From the above discussion it is clear that analysis and discussion of the key issues of change process implementation can be differ depending on the organization structure.
Action to secure effective change:
The action can be taken to implement the change process successfully; Stuart Rose in M&S
has taken some effective decision which can be followed by other organization:
∙ Emphasis on employee training,
∙ Correct stock management,
∙ Changing in organizational hierarchy, and
∙ Changing the outlet or production plant.
5.0. Conclusion
An organisational change has taken place to improve the performance of the organisation,
operate the business smoothly and even it can be taken to change of organisational culture
and behaviour. Beximco implemented some changes to increase their sales during the recession. Moreover, the company was 100% successful to implement the change process.
The Beximco was able to understand the right time to implement the change process which
benefitted the company during the recession. The Beximco change can be followed by other companies of Bangladesh if they have enough resources to implement the change process. Beximco followed the price-focused approach to increase their sales and increase customer value propositions.
References
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Burnes, B. (2009) Managing Change, 5th ed., p. 338, Pearson Education Limited, Essex,England
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Cummings, T. G. and Worley, C. G. (2009) Organizational Development and Change, 9th ed., p. 23-24, South-Western Cengage Learning, USA
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Johnson et al., (2008) ‘One Secret to Maintaining a thriving business is recognizing when it needs a fundamental change’, Harvard Business Review, pp. 51-58, December Issue
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- The Daily Star (2010)
