CaseStudy: Problems at Perrier
CaseStudy: Problems at Perrier
Inour modern complex world of business, change in organizations hasbecome inevitable yet an essential concept to understand. In a simpledefinition change in an organization can be defined as both theprocess through which an organization or business entity changes itsstructures, methods of operation, strategies, culture andtechnologies as well as the impacts associated with the changes, i.e.it’s the process of change and the effect of the changes (Cameron& Green, 2012).For successful change to occur in an organization, different aspectsmust work for the organization such as objectives, employee mustaccept change, time, as well as resources. However, one of the majorobstacles to change in organizations is the employee resistance tochange.
Forany organization change to be successful, the management must be ableto identify and solve key elements or obstacles to the change likeemployee resistance (Van de Ven & Sun, 2011). One aspect ofsuccessful change implementation is the ability to reduce resistanceto the change itself. This paper is based on case analysis indicatinghow need for change can affect eve aspect of organizationalperformance. The case in question is “Problemsat Perrier”.
Perrieris a French water company and one of the giant companies in themineral water business. Established in 1898, the company experienceda steady growth in production, business, and performance with thehighest performance recorded around the late 1980’s. This peakperiod was equally sweet to the employees as they were paid well, andthe other enjoyed other benefits such as extra vocational hours, andsocial benefits among other benefits. The working terms were verypleasing to the workers, as it was impossible to get such from anyother industry. However, come 1990, an element or particle of benzenewas identified in a bottle of water from the Pierre Company. Thisincident was the start of the company’s downfall. The company’sreputation was tarnished, and instead it experienced struggles tomaintain its reputation and be relevant towards its businessoperations, to the customers as well as maintaining its profits. Thenegative impact was greatly initiated by the collapse of the Americanmarket, by the year 1992, the company’s productivity andperformance on the business front, had been reduced by half, and atsome point neared a state of bankruptcy (Tomlinson,2004).
KeyElements of Resistance to Change in the Case
Changecan be termed as ‘modus operandi’ meaning that it requiresstrategic and comprehensive preparation as it can result in a stateof uncertainty. With reference to the Perrier Case, one of thepermeating reasons behind resistance to change by the company’semployees is the occurrence of unexplained change, which resultedinto a state of uncertainty and fear among the employees. Inaddition, there is a gap that is experienced between during theprocess of change (Tomlinson, 2004). One of the impactions gaps, isthat of rupture between the organization’s management team and theworkers is experienced which is attributed to poor communicationbetween the two groups.
Causesof resistance from the workers can be listed as (Tomlinson, 2004)
Downfall in the level of sales made by the company would lead to fear of losing their jobs.
Company’s intention to reduce the number of employees by 15% of the total number solidified the fears among the employees.
The move by the company to place the bottles from competing companies (Badoit Rogue bottles) in their staff cafeteria was seen as a provocative act by the company staff. It was seen as a minacious message
Lastly, there were experiences of poor communication between the employees and the management body.
Disagreement,lack of reformative communication resulted into lack of convictionthat change was needed, and perceiving that the timing of the changewas wrong fueled the resistance to change (Lawrence, 1996).
Theplan on how to manage the change has been a challenge not only to thecompany in question, Perrier, but also to many other businessentities globally, when effective implementation measures aren’tadhered to. According to the case, the management at Perrier Companyimplemented extortionate amount of changes within a short period oftime, this in turn wasn’t received well by the employees, andinstead they ignored the changes (Tomlinson, 2004). The resultingchaos ruined the relationship between the management and theemployees. Moreover, due to the fact that, the majority of theworkers were under the union, the matter was more complicated as theunion was as well against the change (Cameron& Green, 2012).The company was believed to take a hard lined approach to solve thechange, and in turn increased the resistance from the employees.
ChangeManagement Strategy for Perrier Case
Thereare different strategies that can be deployed for effective changemanagement. With reference to the Pierre case different approachescould suit the change management, and in turn curb the menace relatedto change resistance. According to the Pierre change management, theeffective strategy that would suit the case and one that I wouldadvocate is the Environmental-Adaptivestrategy, or the Lewin’s style of change management model. Thisapproach entails three major steps which, according to Lewin, areunfreezing, change and then re-freezing (Palmer,Akin & Dunford, 2008).
Asimple strategy would entail three stages(PreparationChange/Transition—Adoptionof new change).With reference to the case given, the first and important point wasto explain the situation to the employees and the stakeholderaffected. This is the unfreezing stage, and entails the management,preparing the rest of the staff, i.e. the employees to accept thechange. This would entail communicating effectively the situation,breaking down the scenario before embarking on building a new style.Preparing the employees would entail explaining to them, thefinancial status of the organization, and in turn why it wasessential to implement the intended change. At this point employeeattitude and beliefs are challenged, and thus possesses the difficultpart of the change process. Employees oppose loss and disruptions.However, effective preparation and communication of the situation,they will readily adapt to the new style/circumstances. Change isbased on the formation of a new organization, and involving theemployees in making the new organization would help reduce theresistance to change. At this stage, there will be identification ofthe needs of the intended change.
Thesecond stage to deal with the situation at Pierre would be the changeitself or the transition period. At this stage, both employees andthe management would look for new approached to address theiruncertainties. This in turn would result to the acting in a way thatwould support the new invented direction. This stage would be gradualas different stakeholder adapts to the new agreed approach afterdialogue and deliberation. At this stage, there is frequentcommunication, rumors should be dispelled, empower the employees foraction, bringing people together.
Finally,the strategy after all the involved people have adopted the new styleof doing things, the organization is ready to re-establish itselfsuch as new roles, job descriptions, worker duties. This stage allowsa new form of stability, as all parties involved become confident ofthe new devised ways (Palmer,Akin & Dunford, 2008).At this stage, the management will be required to Anchor changesagreed on into company culture, devise ways to sustain the adoptedchange, always offer needed support and training.
Withreference to the chosen strategy, it would offer the stakeholders andespecially the management to break down the impending change and inturn communicate it to the employees. This would in turn prevent themanagement making hasty changes without involving all the relevantpeople, hence reduce chances of rebellion from the workers. Inaddition, the strategy would offer the company an effectiveenvironment to dialogue and come up with the best suitable measure tocounter the change, hence bringing together all the affected groups.This would again reduce the change resistance cases. Finally, themodel would offer the employees and the workers to work together forthe best attribute that suits the organization. The strategy wouldoffer education and communication platforms, which were missing fromthe Perrier case. In addition, it would be effective in encouragingparticipation and involvement of the relevant people affected, i.e.the management and the employees. It would also help withfacilitation and support, and agreement attainment.
Inconclusion, one of the troublesome and insuperable problems faced bybusiness entities is employee resistance to change. Resistance may beexercised in different forms such as complaints, hostility, andstrike among other actions. Just like the case of Perrier Company,any organization isn’t immune to change. However, how change ishandled impacts the success of the organization in managing change.With reference to Perrier Company, the management failed to amenablyapproach the workers, and in turn lack of communication and endlessgaps between workers and management resulted to change resistance.However, with the implementation ofPreparationChange/Transition—Adoption of the new change,the organization will have managed to contain the case.
Cameron,E., & Green, M. (2012). Makingsense of change management: A complete guide to the models, tools andtechniques of organizational change.London: Kogan Page.
Lawrence,P. R. (1996). Howto deal with resistance to change.Retrieved 08 13, 2014, from HBR.org:http://hbr.org/1969/01/how-to-deal-with-resistance-to-change
Palmer,I., Akin, G., & Dunford, R. (2008). Managingorganizational change: A multiple perspectives approach.New York: McGraw-Hill Higher Education.
Tomlinson,R. (2004). Troubled Waters At Perrier. Fortune, 150(11), 173-176.
Vande Ven, A. H., & Sun, K. (2011). Breakdowns in ImplementingModels of Organization Change. AcademyOf Management Perspectives, 25(3), 58-74.