In the business world, companies come to a point of equilibrium where their organisation is neither growing nor declining, but in our ever changing and expanding world in more simple terms as explained by Sir John Harvey jones from the documentary not progressing is the same as regressing. The Morgan Motor Car Company (MMCC here after) has reached a point where their demand is too great and they do not produce enough cars to satisfy customers. The MMCC will have to adapt and look for ways in which they can change the company to help it grow and further its success. The MMCC is struggling to adapt as they have created a large stigma around change within the company. The flow of information between upper management and the rest of the employees is quite limited causing more oversight from management into the lack of efficiency of the production line and a need for innovation. These reasons can be tackled using methods such as the Action Research Model, improved leadership through participatory management styles and reinvesting back into the company. Through all these change systems along with specific recommendations the company will be able to become more sustainable competitive and rejoin contemporary society to successfully implement the needed changes. Identifying the foundational issues hindering the success and performance of the company is the first step to realising the need for change within an organisation.
Trang 1Morgan Motor Car Company Dilemma Introduction
In the business world, companies come to a point of equilibrium where their
organisation is neither growing nor declining, but in our ever changing and expanding world
in more simple terms as explained by Sir John Harvey jones from the documentary not progressing is the same as regressing The Morgan Motor Car Company (MMCC here after) has reached a point where their demand is too great and they do not produce enough cars to satisfy customers The MMCC will have to adapt and look for ways in which they can change the company to help it grow and further its success The MMCC is struggling to adapt as they have created a large stigma around change within the company The flow of information between upper management and the rest of the employees is quite limited causing more oversight from management into the lack of efficiency of the production line and a need for innovation These reasons can be tackled using methods such as the Action Research Model, improved leadership through participatory management styles and reinvesting back into the company Through all these change systems along with specific recommendations the
company will be able to become more sustainable competitive and re-join contemporary society to successfully implement the needed changes Identifying the foundational issues hindering the success and performance of the company is the first step to realising the need for change within an organisation
Key issues experienced the Morgan Motor Car Company
The MMCC chooses not to see the necessity of growth and in turn the whole
company has created a stigma around change which started at the top and funnelled its way down to all the workers Something that is not negative or positive can have a deep negative connotation due to organizational stigma attached to it (Lyons, Pek & Wessel 2017), this can occur through simple rumours or in this case continuous rigidity causing fear of change The company have created this concern that if they are to change it will affect the perceived
‘strong demand’ they have created and tarnish the handmade component of their reputation
As such they fear that change will have a negative impact on both their reputation and supply and demand model The company has run in the same manner for over 50 years and as such they have become so set in their ways, and due to their relative large demand in the form of
Trang 2the six years long waiting list they have grown comfortable and perceive no necessity for change (Bovey & Hede 2001) After hearing that the company needs to aim for larger scale production and that drastic changes need to occur the upper management finds every reason
to avoid this diagnosis showing clear signs of cognitive rigidity and reluctance to lose
control (Oreg 2003) Because of this fear of organisational change, and the fact that they have been operating the same way since the 1910’s it means there is large potential and room for improvement This is one of the MMCC’s largest issues because without accepting and transitioning into the action stage no changes will occur at all, meaning the company will continue to plateau and the rest of society will only outgrow it
The scale of production within the MMCC is very small when compared to big car companies Their 130 employees are producing only 9 cars a week which is approximately
400 a year given the working weeks The six-year waiting list is a demand far greater than the production causing large delays between customers ordering cars and receiving them The core selling point of the company is making handmade cars affordable to the average buyer, but with such a low production rate this means that the case flow through the company is subsequently also not very fast To stay ahead of the market, they were advised to either increase the price of the individual cars or produce a larger quantity of cars without
increasing cost Organisations need to continually prepare for future problems and this is best done by changing and adapting by means of eliminating the initial threat, often this occurs through innovation (Senaratne & Kuruwita 2010) To stand by the concept of the affordable handmade cars they must look towards the latter, the MMCC struggles to sperate the
production process into a clean efficient chain line and miss opportunities to invest back into the company The MMCC’s managerial team are very focused on the concept of the niche family business they have built, as it has worked well in the past this is understandable However, because it has worked so far doesn’t mean that the methods for building the cars should be the same as it was 70 years prior Lacking innovation or accepting the need for change can have a negative effect on company’s future performance (Heidenreich &
Kraemer 2015) This refusal to accept expansion or need for technological innovation by updating the production process and equipment shows there is fear within the organisation dealing with the concept of change
The key issues that are being faced by the company are that the scale of production is
no match for the excessive demand Although the MMCC have cornered this niche part of the market, where handmade vehicles are made affordable to the average buyer, they are not
Trang 3optimizing their business potential and the company isn’t growing The MMCC is a family run business with father and son in charge, the style of management used reflects the
benevolent authoritative system meaning that in the autocratic top down system employees are given some say but it’s very restricted leading to a very one-sided sharing of information (Kahya & Pabuçcu 2015) Therefore, as seen in the documentary the employees are very labour orientated and do not partake in important decision making even when they have an opinion to voice This method of management means there is little communication from those further down the ladder, meaning little say from the car builders makes its way to the
meetings with the heads of departments Such communication could be beneficial for
enlightening ways to increase efficiency of the production line, raising the car production and overall increase in business performance Research has been shown that using the
participatory management style leads to a decrease in resistance to change and as stated an overall increase in the performance after the change has been implemented (Pardo-del-Val, Martínez-Fuentes & Roig-Dobón 2012) To better learn ways in which the MMCC can be improved should most definitely come from all corners of the company which does include the builders themselves The upper management must readjust their leadership and
management style to accommodate for all the untapped potential just lying in wait
(MacKillop 2018) These are the main issues being faced by the MMCC and the best methods for solving them are as followed
Strategies and methods appropriate for alleviating the experienced issues
To successfully tackle the key issues being faced by the MMCC the Action Research Model would be an excellent fit for this specific case Through this model the company is not initially jumping head first into the change they fear so greatly, instead they are just starting off with adequate research, planning and development (Phillips 2014) Considering what other successful and failing companies in similar industries are doing, comparing key aspects from leadership technique, technology and innovation, business strategies and demand and supply ratios The Action Research Model is an intelligent choice for this situation due to its cyclical system of doing the relevant research, consulting experts, planning the change, implementing the change then gathering feedback and repeating the whole cycle again to see
if the change was in simple turns a good or bad choice (Waddell et al 2016) In this case the MMCC can trial these changes after the adequate research and planning and see whether the
Trang 4results suit their needs, if the company and consumers are satisfied then they can trial bigger changes furthering the progress This method has many valuable points, with the beginning of the cycle lots of initial research and planning is undertaken reducing the sudden shock of the need for change, instead it brings it about in a very explanatory manner showing why this needs to happen and what are the best ways to go about handling the processes (Beailieu 2017) Once the company has implemented the changes they must continue to manage the organisation in the same manner unceasingly looking for methods of improvement as to not fall too comfortable again putting then in the same situation 20 years down the track Just changing the company is only half the task, making sure that the changes are continued and sustainable ensures that that company is actively working to improve overall performance (Elden & Chisholm 1993) Through the Action Research Model this management of the change after implementation becomes almost second nature as the systems cycle method continues as more time goes past and more opportunities present themselves
The upper management of the MMCC displayed a very benevolent authoritative style
of leadership and this method has been sufficient to run the company in the same manner as it has been however for proper change to occur a new style of leadership and management is needed Incrementally adjusting the production line was clearly not effective as seen when Sir john went back 6 months later the company was unable to move from 9 cars a week to 10 Therefore, a more modular or corporate transformation is needed as this will change the way things are done more drastically and goals will be set higher (Dunphy & Stace 1993)
However, given the directive management style currently being used this will be harder to achieve due to lack of communication and participation of the workers within the company that unless changed will endure through to the change process For the change to be more universally accepted Charismatic Transportation needs to occur and this is achieved through collaborative of consultative management (MacKillop 2018) To fully undertake this style of management the workers need to have a much larger role in decision making, planning of how these changes will be enacted, and then continue through in the implantation stage (MacKillop 2018) With the workers being actively involved they can give feedback which utilises the Action Research model as previously explained This will allow management to adjust more easily and for the workers to be kept in the loop and not have difficulty accepting the change when they helped initiate and implement it This method of management is also very beneficial as much potential talent is often looked over but when given a voice or an
Trang 5opportunity to take part, the untapped potential often rises (Pardo-del-Val,
Martínez-Fuentes & Roig-Dobón 2012)
A company must constantly look to the future and past considering what sustainable methods are necessary to keep business flourishing (Volberda, Van Den Bosch & Mihalache 2014) Both corporate foresight and innovation have both been positively linked with success when referring to organisational sustainability and corporate competitiveness (Gracht,
Vennemann & Darkow 2010) The MMCC has been technologically stuck in the 1920’s refusing to catch up to the modern world, management may use computers however most methods in the workshop our outdated, severely slowing the production process The MMCC will have to initiate some sort of technological or developmental innovation to increase the number of cars produced creating a more efficient production line As described previously participatory management plays a significant part in learning and understanding where such innovations are needed and can be applied By updating the company through innovation; whether technological or developmental, the company can enhance performance and remain sustainable in the competitive environment it resides in (Carmeli, Gelbard & Gefen 2010) The company needs to undergo some sustainability training and develop their reinvestment policies, where by money is invested back into the company to make more money or
spending to save This reinvestment can take place in terms of updating the technology but also in refinement of the production line to create higher efficacy (Lozano, Ceulemans & Scarff Seatter 2015) Acquiring more modern technology used only in areas that will not affect or tarnish the handmade reputation Reinvestment creates a growing organisational culture showing that change is necessary and welcomed Using this method of reinvestment participatory management and corporate foresight, the company can aim to achieve their goals of producing more cars in a more efficient way at the same cost or even cheaper
Specific recommendations to help improve the Morgan Motor Car Company
The MMCC were clearly struggling with adopting the modern methods of
organisational change and development as the company has been so set in its ways for a long time Hiring an external Organisational Development (OD) Practitioner will help them implement and follow the Action Research Method as it is most suited to this situation and is most effective way for the company to bring about the necessary change As was
demonstrated in the documentary any internal OD practitioner will try to stay to closely to th
Trang 6methods already displayed or remaining at the status quo, this is due to all the upper
management being against the idea of big change for the company in the first place This further emphasises the need for an external change agent to view the issues at hand more objectively In a study where both an internal and external change agent were used, the external agent had a higher success rate bringing about the changes needed and the overall performance of the company (Scurrah Shani & Zipfel 1971), and in this specific case the same should apply effectively Having the OD practitioner as a part of the company will bring an expert in the field of organisational change and transformation, through using the Action Research model as a system of helping to plan and implementing the changes the overall resistance to change should be minimised As the Action Research Model implements
a very cyclical and participatory model reaching to all corners of the company the OD
practitioner will be able to personal communicate with most aspects of the whole company, this is also optimized due to relatively small size of the company They will also be teaching upper management to take part in the transformation of the company so they may continue to adapt to a more sustainable way of conducting business and continuously looking for
methods as to which the company so grow and stay competitive (Hubbell 2013)
To better manage their workers and the change they wish to initiate, the MMCC should increase the participation and communication pathways between most aspects of the company Interdepartmental and vertical communication should be the main focuses as this is where there were currently lacking At the beginning of the change planning, having regular meetings with the representatives from the different sections of the production line would allow a good flow of communication on what the best ways to optimise the time taken to produce a car A company benefits from the active participation of the workers in the process
of planning and initiating change prior to the implementation which will allow for a much smoother action phase (Butler & Fitzgerald 2001) In the documentary a worker clearly explained that he was unsure of why the engine was put in near the beginning as this made the rest of the construction more difficult, this issue could easily be alleviated through simple communication Simply talking to the other departments could move the engine installation
to the end of the process which as explained in the documentary could reduce the build time
of all subsequent parts therefore reducing the overall time it takes to construct one car Increasing the communication between the car manufactures and the upper management through meetings and weekly reports will also increase readiness for change and acceptance due to increase in understanding of why the change is occurring and how it will be carried out
Trang 7(Waddell et al 2016) Through the increased participation and communication within the company, the MMCC will be able to greatly increase the efficiency of production, create smooth change implementation and open great opportunities hidden previously though lack
of involvement
The MMCC should be aiming for roughly 600 cars per year instead of their current small goal of an extra car per week as this will create the environment where innovation becomes a necessity to achieve the goals set forth Increasing the efficiency of the production line is essential as it make the flow of the construction more fluid and rational Also
implementing new technologies into the workplace that will make jobs easier and quicker is something that is achievable within the MMCC Reinvestment through innovation is a large part of organisational change and it has been proven that companies that regularly incorporate innovation within it self whether through management systems, information flow or
technology are positive correlated with increased performance of the company (Huang et al 2015) Using simply power tools such as drills, sanders and screwdrivers are all ways to drastically reduce the time of simple tasks without affecting the ‘handmade’ reputation Innovation does not mean the company lets machines take over, it’s a way off using modern technologies and methods to increase the productivity of the current workshop The company needs to understand the concept of spending to save, meaning they need to put money pack into the company to buy the bare minimum to start off with such as the tools described above Then as more cars are produced and more money flows through the company bigger more expensive equipment can be purchased to further increase efficiency The MMCC has been using the same techniques to build its cars for such a long time, this means that there is large room for new modern methods and technologies to help pick up the pace and drive the company towards achieving the set-out goals becoming more competitive in the market
Conclusion
The MMCC reached a plateau due to their same production rate yet increased demand, for the company to grow, increase performance and become more successful they must learn
to adapt and change Hiring an external change agent and using the Action Research Method the company can find the best ways in which they need to adapt Having the specialist
alleviates subjectivity leaving more accurate recommendations and a higher level of expertise with the cyclical model showing what changes are best and what needs
Trang 8further progression The upper management of the MMCC has run in an authoritative manner for too long with lack of communication and participation occurring from below, by simply being more inclusive of all areas of the workforce, untapped potential and opportunities for ways to increase productivity will be uncovered while simultaneously causing higher
satisfaction reducing the resistance to change clearly apparent The MMCC has lacked innovation for too long so reinvestment back into the company has become almost essential, the company now suffers from an inefficient production line and use outdated methods of constructing the cars meaning only a low rate of production can occur Reinvesting back into the company, or spending money now to save money later along with participatory planning from the workers means that the production line can be made more efficient and better technologies can be used without tarnishing the handmade reputation that pushes their
demand Using these methods, the issues being faced by the Morgan Motor Car Company can
be alleviated making room for the changes described and help the company regain its high stature known for making handmade cars for the average buyer but on a much greater and more successful scale
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