HRM
Change Management - Perrier Case Study
In any organization there is a need for change, otherwise organizations will stagnate and fail to adapt to changing environments. There are many drivers to change; changes in the competitive environment that result from the lowering of barriers to trade, such as increasing use of technology to facilitate trade, especially over international boarders and transportation technology increasing the level of competition faced in market (Salawu and Agboola, 2011, p235). Increasing levels of competition may be a significant driver for incumbent firm to develop and maintain competitive advantage, which may drive the need for innovation to compete. This was seen with Perrier and the introduction of Badiot Rouge. Where competition is coming in from offshore locations there is also the potential for the firm to face price pressures, with many offshore producers having the potential benefit of comparative advantage and able to offer lower prices (Nellis and Parker, 2006, p139).
The general economy may also be seen as a driver for change; for example in a recession there will be decreasing sales due to lowering aggregate demand may reduce the benefits of the economies of scope and scale, and with lower sales will result in lower profits and possible losses, so firms need to find ways to survive by finding ways of cutting costs or increasing efficiency.
Consumer fashions and trends will also impact on a business and impact in the way consumers choose to buy, or not to buy products. This can be seen easily in many markets, the fashion industry is one f the most transparent examples, but it is true all almost all sectors. Perrier found they benefited from fashions and trends during the 1980's when bottled water became fashionable. Firms need to look at the markets and assess the needs of consumers so they can adapt their products and marketing to meet the emerging demands (Hooley et al., 2007, p277).
Question 2
It is natural for employees to have concerns when this process occurs, especially if they do not understand why the change is occurring and are unable to assess what impact it will have on their job. The change process has the potential to result in fear and resistance (Buchanan and Huczynski, 2010, p561). Generally, employees dislike change.
Resistance from employees can make change hard to implement, can increase the time taken for the change to take place, increase the associated costs and resource use and may even result in a change failure (Thomas and Hardy, 2011, p322; Buchanan and Huczynski, 2010, p562).
Question 3
There appear to be a number of issues at Perrier that indicate resistance to change. The poor employment relationship between the employees and management is an indicator of resistance. The case shows that management wants to make a 15% cut in the workforce, however, this is unlikely to be accepted by the employees, as this will have a cost to themselves and it will be perceived as against their interests. Furthermore, if the employees do not understand how and why this is to take place and any strategies that will be used there is increased room for fear.
The union presence and opposing attitude of the union also shows resistance to the changes. The union may be seen as a centre of influence, and as such not only reflect employee views, but also influences them. With many years of success in the past, with a history of pay rises and bonuses the union, and the backing of a large firm the union indicates that they feel they are being disregarded, stating Nestle can do what they like,
The third element of resistance may be seen in the way that the management is dealing with the resistance, rather than tackling it, they are causing a confrontation, as seen with the Badiot Rouge bottles in the staff canteen, which lead to the…
