Organisational Change Case Study

Introduction This essay will explore a case study of Origin Energy to illustrate an organisation that has undergone a change. The organisational culture before and after the change will be described, management styles within the organisation will be analysed, the relationship between motivation and performance will also be explored and finally the change management strategies used by the organisation will be discussed as well. Each of these sections will be explored to support the hypothesis that culture is an integral part of an organisation.

Before the individual sections are discussed however, the essay will look at the background of Origin Energy. Background Origin Energy is a leading energy provider within the Asia-Pacific region. It is involved in finding new sources of energy, producing and retailing it. After the de-merger of Origin Energy from Boral in 2000 it officially became an energy company. It began as a gas company that later ventured into the electricity industry as well. Origin Energy has made many investments and undertaken many acquisitions of various businesses in both industries to ensure its place on the market.

The environment that Origin Energy trades on is ever changing due the deregulation of the energy market in Australia (Waddell, Cummings & Worley, 2007). Therefore, certain measures have been undertaken by Origin Energy to increase the efficiency of its work and provide better service to its customers. Origin Energy did not have the resources in the founding years of their business to manage the credit and billing sections of their business and therefore it outsourced these functions to a financial business named Wipro.

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After many years of this function being performed by Wipro and the constant expansion of Origin Energy it was decided in 2007 that to increase the proficiency of Origin Energy’s billing and credit processes the teams that were performing this function at Wipro were provided with the opportunity to be transitioned across to work internally for Origin Energy. Organisational Culture Culture is said to be the representation of social discourses such as belief systems, attitudes, values, behaviour and norms that distinguish a society Wood et al. , 2010). This definition on culture is closely matched to the definition of culture as the accumulation of human traditions and customs and that culture is a social construction (Berry & Sam, 2006). Culture exists on a nationalistic level, however it also exists within organisations (Wood et al. , 2010). Organisational culture can often be derived from the national culture’s shared discourse (Wood et al. , 2010). It is also possible because organisations are sub-systems of a society (Wood et al. 2010). Although organisations share similarities to the host culture each organisation has their own individual culture (Select Knowledge, 2001). Organisational culture can be defined similarly to the definition of culture provided previously in that it is the shared discourses of the people belonging to it (Bartol, 2008). It is through the process of interacting with others that a person learns culture and cultural discourses are transmitted (Schein, 1987).

Organisational culture is reflected by the shared assumptions held in the organisation as well as in its rituals, policies, systems, and procedures which influence the assumed desired behaviours that the organisation believes is part of their culture (Bartol, 2008). The culture of an organisation can be explained by using Hofstede’s (1997) dimensions of values, which for the purpose of this essay will only include power distance and masculinity versus femininity.

In diagnosing Origin Energy’s existing culture within its billing team after their transition from Wipro, it has been suggested that firstly the culture before the transition was completed should be compared to the current culture so that the current culture can be more clearly identified (Waddell, Cummings & Worley, 2007). The first dimension power distance describes the level at which power is distributed throughout the organisation, meaning that an organisation might have levels of power for its employees or not (Hofstede, 1997).

In terms of this relating to Origin Energy’s billing teams before their transition from Wipro is that their experience with Origin Energy has let them be less subject to a power hierarchy than they were at Wipro where the structure of power is more rigid (Origin Energy, 2010). Origin uses a more collaborative approach to making decisions in that the managers communicate with and value input and feedback from their employees (Origin Energy, 2010). Also employees have autonomy is handling complex issues, although the managers hold a position of power in aking the final decision and are involved in the maintenance of procedures and behaviours (Origin Energy, 2010). This was not their experience at Wipro where they had less autonomy, as they were boss-subordinate and this means that they needed their manager’s approval to make decisions on issues (Waddell, Cummings & Worley, 2007). In the other dimension used to illustrate the culture before and after the billing teams were contracted to Origin is masculinity versus femininity (Hofstede, 1997).

Masculinity refers to the emphasis on competition and assertiveness in an organisation and there is more attention placed on success (Hofstede, 1997). In regards to the billing team they have experienced a stronger sense of this strive for success with Origin Energy than they did with Wipro as the energy market that Origin Energy trades on is more competitive than the finance industry in light of the deregulation of gas and electricity which was mentioned previously (Origin Energy, 2010; Waddell, Cummings & Worley, 2007). Femininity refers to the emphasis on relationships and the quality of life (Hofstede, 1997).

The billing team have experienced higher value on the quality of life and the fostering of relationships with Origin Energy as they were more openly communicated to by their managers at Origin Energy as it has a more collaborative approach to involving staff participation in organisational processes than they had at Wipro where they experienced a more authoritarian approach to decision making from their managers and this is evident by the use of fortnightly meetings conducted by Origin Energy’s managers (Origin Energy, 2010).

Origin also offers more flexible start and finish times for employees as long as their hours are properly completed where Wipro was more rigid about their working times (Origin Energy, 2010). Throughout this comparison of culture various leadership styles have briefly been mentioned, as they are part of organisational culture and help to facilitate it (Hoffman, 2005). Management and Leadership Styles Two leadership theories can be used to explain how Origin Energy has fostered this culture and explain their approach in managing their newly contracted billing team.

These two theories include House’s Path-Goal Leadership Theory and the Transactional Leadership Theory. House’s Path-Goal Theory gives insight into the reason for the identified culture of Origin Energy as it factors in that leaders affect the motivation of employees to accomplish tasks to receive rewards and the leader’s style will influence the performance and satisfaction of their employees (Shriberg & Shriberg, 2006). The theory states that a leader is responsible to motivate employees to achieve goals and the level of motivation of the employees is dependant of the clarification of expectations (Lussier & Achua, 2010).

It can be used to identify and explain different leadership styles (Shriberg & Shriberg, 2006). As mentioned previously Origin Energy takes a more collaborative approach in the process of decision-making and is less power distant (Hofstede, 1997) with its employees than Wipro. According to House’s Path-Goal Theory, Origin’s managers use a participative leadership style as the managers consult with and account for employee’s suggestions before a decision is made and provide employee with an understanding of the circumstances surrounding the decision (Landy & Conte, 2007).

Another theory that demonstrates Origin Energy’s approach to leadership is the Transactional Leadership Theory. Transactional Leadership Theory involves the agreed expectations between managers and employees that are exchanged daily between the two parties to ascertain routine tasks on performance are completed successfully (Wood et al. , 2010). According to this theory leaders are more task driven and make employees more compliant in striving to achieve organisational goals (Martin, Cashel, Wagstaff & Breunig, 2006).

Importance is placed on employees’ contribution and responsibility regarding the organisation (Kakabadse, Bank & Vinnicombe, 2004). The transactional leadership perspective states that leaders will be involved with their employees when the employees require direction (Martin et al. , 2006). The focus is on the self-purpose of the employees and therefore the manager has little involvement with the employees (Kakabadse, Bank & Vinnicombe, 2004). This is evident in the organisational culture of Origin Energy as the billing teams’ employees have autonomy in their roles as discussed previously (Origin Energy, 2010).

Like House’s Path-Goal Theory there are elements to leadership styles in Transactional Leadership Theory (Wood et al. , 2010). Transactional Leadership Theory may state that managers have little involvement with their employees however the theory applies to task-orientated leaders that are able to facilitate the achievement of goals (Martin et al. , 2006). The leadership styles of this theory reflect that and the style used by Origin Energy’s managers is the active management by exception approach (Wood et al. , 2010). This means concentration is placed on the correction of irregularities and mistakes of the employees’ activities (Wood et al. 2010). This is the case for Origin Energy as mentioned earlier the managers allow employees autonomy in their roles, although they are responsible for maintaining expected norms and standards of the organisation and therefore can correct any deviation from the organisations procedures and standards of behaviour (Wood et al. , 2010). Leaders have an impact on the motivation of their employees and motivation is also influenced by organisational culture, which in turn has an influence on performance (Bartol, 2008). Motivation and Performance Theories of motivation can be used to describe the relationship between performance and motivation.

Maslow’s Hierarchy of Needs is one of the theories that can be used to demonstrate this. In this theory Maslow identified five basic human needs (Maslow & Stephens, 2000). Namely these needs Maslow identified, in order from the most fundamental, are physiological, safety, belongingness, esteem and self-actualisation (Pattanayak, 2005). Physiological needs refer to the basic needs of eating, having shelter and wearing clothes (Hodgetts & Hegar, 2008). As Origin Energy has contracted the billing team from Wipro they aid employees in satisfying this need. Safety needs involve security and stability (Wood et al. 2010). Origin Energy’s managers openly communicates with their staff to ensure they are made aware of change and understand the reasons for it which allows the employees to feel more secure in their positions within the organisation (Wood et al. , 2010). Third is the need for affiliation and acceptance, which comes from a desire to belong, and as previously discussed Origin Energy’s culture is feminine (Hofstede, 1997) in the sense that the organisation fosters relationships between its staff and this can be seen through the use of their fortnightly meetings.

The esteem need relates to self-esteem, respect, achievement and recognition of performance (Hodgetts & Hegar, 2008). Origin Energy aids employees to satisfy this needs by allowing their participation in organisational processes. The highest need on the hierarchy is self-actualisation and this need is about realising one’s own potential as well as the growth and development desired to fulfill that potential (Agarwal, 1982). Origin Energy allows their employees autonomy in their roles, training to be successful in them and there are opportunities for advancement (Origin Energy, 2010).

Another Theory that helps to describe the relationship of motivation and performance is Herzberg Motivation-Hygiene Theory. Herzberg’s theory is based on the assumption that there are factors that add to employees’ satisfaction and dissatisfaction (Daft, 2005). Hygiene factors relate to factors in context to the job such as organisational policies; supervision, salaries, communication and the conditions at work (Borkowski, 2010). Motivation factors are associated to factors related to job content (Montana & Charnov, 2000).

Motivators directly influence individuals’ attitudes and performance at work (Waiguchu, Tiagha & Mwaura, 1999) and consist of having recognition, achievement, responsibility, advancement and the work itself (Borkowski, 2010). When motivators are present they affect the satisfaction of the job for employees and in turn creates high motivation, which leads to job enrichment (Daft, 2005). Job enrichment relates to the use of hygiene and motivators within the job roles (Sapru, 2006). Participative management is a product of this theory (Sapru, 2006).

As Origin Energy is seen to use participative management, incorporate the motivators and provides the hygiene factors specified by Herzberg into their roles to lessen job dissatisfaction, they have increased the performance of the billing teams and this is evident in their productivity and behaviour since they were contracted to work for Origin Energy (Origin Energy, 2010). The successful performance of the billing teams and their adaption to Origin Energy’s culture can also be attributed to the implementation of effective change management strategies.

Change Management Strategies Organisations are affected by the changes that occur not only in their internal environment but also from the external one in which they exist (Wood et al. , 2010). Therefore, from this awareness organisations are required to respond to change (Anderson & Anderson, 2010). The reasons for change are crucial to understand as they provide the context for the change to occur in (Anderson & Anderson, 2007). As mentioned reviously Origin Energy contracted the billing teams from Wipro in an attempt to improve operational efficiency to meet ongoing customer requirements (Origin Energy, 2010). Origin went about implementing certain strategies to successfully implement this change. Firstly, Origin Energy analysed the current and future states of their business regarding the issue, which is essential to begin and prepare for the process of organisational change (Origin Energy, 2010; Anderson & Anderson, 2010).

Secondly, Origin Energy and Wipro planned for the change in attempt to create communication with all stakeholders as well as evaluate and pre-empt the risk involved and ensure that there was an operational way for the change to occur, which according to Oakland and Tanner (2007) is a measure for successful change management (Origin Energy, 2010). Origin Energy implemented the change by understanding communication was the key for the success of the transition (Anderson & Anderson, 2010; Origin Energy, 2010).

The managers of Origin Energy and the ones moving over from Wipro were engaged regularly by briefing meetings to inform them of the processes being undertaken to confirm the change flowed down and directed their teams, which is an effective way to implement change (Oakland & Tanner, 2007; Origin Energy, 2010). Another change management strategy used by Origin Energy was the training of each team as they moved them over in stages (Origin Energy, 2010). This was performed by Origin Energy to align the billing teams with Origin Energy’s culture and processes (Oakland & Tanner, 2007).

Origin Energy’s evaluation of the change indicated the objective of increasing the proficiency of its credit and billing function was achieved (Origin Energy, 2010. ) Conclusion Earlier in the essay the background of Origin Energy was described. A definition of organisational culture as well as Origin Energy’s culture before and after it underwent the change was discussed. It explored the management and leadership styles within the organisation, the relationship between motivation and performance and the change management strategies utilized by Origin Energy.

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