Case study: Managing change at Perfect Components
Executive summary
Perfect Components is a company in the car component manufacturing sector with to pants in Australia and additional plants in India and New Zealand. The company is currently facing a challenge surviving with the economic downturn which has influenced demand. The executive board made a decision to undertake a new strategy, cost cutting approach, in its bid to survive and be competitive. As a result, it would stop making some components and focus on those which can be produced with high economies of scale. As a result, there are plans to close down a site in India with only the product development engineering team retained. The main problem facing the company is that it did not involve employees in its decision making and there are risks of the employees resisting the change resulting to its unsuccessful implementation. The company intends to undertake planned change as they will undertake a continuous as well as deliberate change processes.
The analysis illustrates that the change us a phrase episodic change as it is infrequent, discontinuous as well as unintentional. The report proposes to use the Lewin’s Force Field Model whereby the first phase will be unfreezing the status quo of the company, the new level of proposing alternatives and finally the adoption of the new cost cutting strategy. The approach will also undertake a pilot approach in implementing the change ensuring that problem and challenges in the implementation change are resolved. The management will involve the employees in all its phases resulting to an inclusive and participative decision making in the change process.
Table of contents
Executive Summary 2
Table of contents 3
1. Case background 7
2. Analysis 7
2.1 Problem identification/case issues 7
2.2 Problem analysis and justification 8
3. Alternative Solutions 10
4. Recommendations 11
5. Implementation 11
References 13
1. Case background
Perfect Components is an Austrian car components manufacturing company having two plants in the country and additional plaints in India and New Zealand. The company’s objectives is based on good return investments for their shareholders and improving the shareholder value with this goal supported by product innovation, developing the capability of its staff and investing in new technology. The company has over the years managed to maintain a competitive position in the face of competition from companies operating in low cost countries. However, recent economic downturn has impacted demand resulting to the company fighting for its survival. The management has recognized this and the need for change. It has dealt with this by formulating a new strategy focused on cost cutting. In pursuit of this it has stopped producing some components and concentrate on production of other components at fewer sites in order to benefit from economies of scale. As a result, some sites will be closed down and this will result to various challenges to the organisation. The following is an analysis of this challenges resulting from the changes the company aims to make a possible solutions which the company can implement in order to implement the change process in a better manner.
(I.C. JPS 1808)