BE460 Organisation and Leadership in a Globalised World
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Essay
Introduction
Every organization at some point undergoes a transition or change which is essential for its growth and success. This essay will focus on the diverse organizational change faced by the American multinational company Amazon. It will evaluate the role of Amazon its leaders most importantly their former CEO Jeff Bezos in supporting the change, and determinehow the changes impacted their employees and external stakeholders. The essay will also explain the internal issue and specific department in which the change was brought, while determining the strategies that the company use to manage the change, with providing some recommendation for improvement.
Organization change
Organization change is referred to any action which presents a situation for a business organization to alter the current actions of the organization. It can be a change in culture, technology, people, infrastructure, leadership, or the internal process of the company (Erridaand Lotfi, 2021). Amazon the multinational giant focused on business, such as e-commerce, cloud computing, and AI, is one of the biggest IT companies in the world. Even though the company is taken as an example in the business world, on its ways and techniques of managing the company and its growth from just the garage of Bezos house in 1994, to having an office in more than 200 locations around the world. The company also faces trouble when there is an organizational change and has to face trouble with managing that change. In their journey of almost 27 years the company has to face several changesin the last few years the company has made organizational changes likethe acquisition of Wholefoods the grocery giant, the employees’revolt with an accusation on the company of treating them wrong, and the recent transfer of CEO position to Andy Jassy, while Jeff Bezos taking the role of executive chairperson.
Manager role in support the change
The role of managers or leaders is very essential to make the change easy and adaptable for the employee, stakeholder, and consumer. The online retail giant Amazon wanted to take over the organic food industry for a long time so the company acquired the organic food giant whole foods which is in the market since the 1980s in 2017, for $13.7 bn (Stevenson, 2021).This deal was beneficial for the company and even rose its stock market price up to 3.5%, but the company was facing a huge change which was scary for its stakeholder (Butlerand Wood, 2017).Both the leaders of Wholefoods and Amazon have supported this change, and have even initiated that even though there is a cultural difference the company as a whole will overcome it. Amazon is not overtaking the culture of whole foods they are just acquiring it and will let the company and its employees adjust. The leaders of Amazon must have taken into account the Evolutionary theory of organizational change.
Evolutional theory of organization change determines that there are different types of organizations and each serves its purpose in the market. The evolutionary theory has four types of organizational change which are variation, selection, retention, and competition. Variation isan individual level change required when an individual needs skills or development which leads to getting resources for the company. Selection is when the allocation of resources to different initiatives is done with the changed administration or culture. Retention is when an external environment concern sticks as a change with the organization and becomes a reason for its success. The competition factor is when internal or external competition presents and initiates change which becomes necessary for the company to take (Abatecola, et. al., 2020). So, all the companies need to follow the vision of working together in the market, which determines that the companies cannot fight the changes which are brought with the external or internal environmental change. the above-explained initiatives can be followed and managed by the leader or manager of the company and be used to initiate the perspective that drives the positive aspect of that change.
Impact of organization change on Employee experience
Employees are the major stakeholders of a company, as the company requires human resources to function. They are also the first ones to get impacted by any kind of change. The accusation of unsafe working conditions for employees, at the Amazon warehouse, was a very crucial topic for the company, with even the senators and presidential candidates of the US asking about why the employee who was whistleblowing this news was fired. It was even said that the company treats its warehouse workers like robots. The company is lacking the trust of its employees with the pandemic aftereffects, many of the employees not getting their earned compensation pay checks, and the CEO being on the track to become the world's first trillionaire by 2026 (Kelly,2021). It has not only the issue which needs to be resolved but the other employees of the company are also impacted by this cultural change, as amazon was not the company that would jeopardize its employee’s safety and treats them this much negatively. This has initiated protests of employees in Italy Germany, the US, France, and Spain against the company, leading to other employees losing trust in the organization.
Effect of external stakeholders and internal issues on change management
All these changes are part of an organization, whether it is an internal change adapted by the organization or acquisition or expansion or a revolt of employees which can lead to external environment changes. The organization needs to adapt and manage its actions with that change, which is called change management. As the teleological theory also explain the change is continued in an organization until the final goal or objective is not gained. It can also be explained by the teleology focus that implies the involved activities to be taken for a required outcome and finally helped by the change to achieve that goal (Sommit and Sitikarn, 2018).This theory is also useful in the development of a strategic model or goal setting for an organization's end state. With a purposeful ideology that can be adaptive while taking action and motoring the growth. During this goal formation, an organization needs creativity and management to handle that change.
However, this change is affected by the external stakeholders and internal issues, Amazon has kept its silence even when the investors asked about the situation of the warehouse and its employees (Yohn,2020). The company is even taking its step to focus on initiating environmental safety with their renewable energy for the packaging of its goods which can help in reducing the packaging footprints. The company also has assured to advance their product transparency and traceability; However, they do not have any possible solution or answer for the condition of their labour and employees at the warehouses. The employees, investors, shareholders everyone is liable to know the result and the situation, but CEO did not respond very well on the issue.The stakeholders, which are employees made a union against the company, as they also accused the company of neglecting their needs just for the sake of providing fast delivery (Sherman, 2021).
This issue can affect the company is decreasing their profit as well as leading towards decreased churn rate of the company. while the company is focusing on its one stakeholder which is the consumer, they should not neglect the need of another stakeholder which is the employee.
Importance of Managers communicating the changeto the organization and different department
While the organization is installing any future change, their responsibility also requires the change communication to the employees and the department which is the key area of that change. The technique of how the change is communicated leads to determining the adaptability and acceptance within the organization (Firdaus and Handriyono, 2018). A wrong way of communicating change can lead to loss of employees, disrupted work processes, and other issues in the future. It is also explained by the dialectical theories of the organization change, created from the philosophy of Plato and Aristotle. The dialectical theory is based on assumption that the organization is present in a pluralistic world where everything and every force of the external and internal environment are focusing on getting control and domination (Alimadadi, et. al., 2019). The theory later explains that if not taken care with then these opposing powers get enough power to take control which is called the change. and these changes require proper selection of change management and strategic planning as well as communicating the change properly, to overcome and manage these changes. However, if not managed carefully there can be negative propositions and outcomes.
The American multination amazon also faced the step down of their CEO, Jeff Bezos is a sudden change in the organization. Jeff Bezos has been the key person of Amazon since he started it, stepping down from his CEO role in 2021 (Allyn,2021). Now he will take over the role of executive chairperson and Andy Jessy is the new CEO of the company. This change is troublesome for most of the organization, and its employees, as a change in the senior level position can lead to various changes in the organization, for which the organization requires to communicate what is happening, why it is happening, and why.
Strategies that are used by Amazon to promote change
The company needs various strategies to overcome all these issues which are present with change, Amazon has divulged various strategies such as for their accusation of whole foods, and chaos that company employees and stakeholders were facing, the company undertook their leader’s ideology such as the book of Wholefoods former CEO john Mackey which determines his trust in the organization and how the acquisition of Amazon was essential for running the whole foods in the market. It can be a strategy of positive leadership that can motivate its stakeholders to trust the decision (Jarrett,2020). Also,when the CEO step down, he wrote a letter to all the employees of the company, as well as created a buzz of his step for a longer period, which made the transition much easier. In his letter he explained his reason for demotion and entrusted the company to Andy Jessy, saying he is not going anywhere while motivating his staff (Amazon, 2021). These strategies were useful for the company at the time of organizational change for amazon, but they were not successful, as the organization still does not have an answer for the issue of mistreatment of warehouse workers.
Recommendation
Organizational change is the universal truth, any internal or external factor can be a reason behind that change. However, the company has an issue of managing that change, such as Amazon has faced. Even though the company’s strategies were effective they require to be even more impactful. The issue of warehouse mistreatment of employees requires the strategy of putting people first, as people are the fuel of organization, keeping them a priority and valuing them should be the main aspect while there is a change (Fauver, et. al., 2018). Amazon should strategies various methods, of resolving the issue of their workers, which is their moral as well as reliable duty. Amazon can also make the change compelling and exciting, as when the company faces change employees can be confused and that confusion can lead to a lack of interest (Stouten, et al., 2018). So, the leader should devote their time to initiating the change and helping the employees at every step. Such as the whole food acquisition requires the company’s leader to not only motivate their current employees but retain the existing employees with the help of this motivating and helping strategy.
Conclusion
To sum up the above report, change is a constant procedure, and the organization process can change at any point. Such as amazon has various changes like their acquisition of whole foods, their change in leadership with transition in the CEO position, and the issue of their warehouse employee’s strike. The company faced these changes and ensures strategies of communicating the change and motivating the employees. However, they remained silent on the issue of employee mistreatment, so this report has provided a certain recommendation of putting people first, and making the change compelling and exciting for improvement of their change management.
Reference
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