Music industry belongs to turbulent and high-velocity markets because of products it deals with. By making music accessible and with prices set at a reasonable cost, high industry standards are being put in place. Similar to other industries, music industry, its structure and function¬ing must reflect, therefore, the nature of the environment in which it is operating. In order to ensure its survival and future success music industry must be readily adaptable to the external demands placed upon it. The history of music industry development shows that the level of profit is a result of quality service and change management.
Following the theory of reasoned action, it is possible to say that industry behavior should be “positive for change to occur” (Kritsonis, 2005). The theory planned behavior helps to explain the driven forces of the change. For music industry, it is crucial to have “a control over the opportunities, resources, and skills necessary to perform the desired behavior” (Kritsonis, 2005). The magnitude of the impact of the change scenario can be explained by external and internal drivers which have a great impact on music industry today (Senior, 2001).
External change drivers are caused by innovation rapid technological changes and innovations proposed by competitors within the industry. One of the major changes deals with the specification of products which may be considered in terms of their design features and performance characteristics such as the advert of digital technology. Also, the specification of music may be expressed in terms of its “design” and performance (MP3, iPod, etc. ). Though the move to online trading has been embraced by many music record firms, the question of whether it needs to form a part of every firm's business model is still being debated.
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Comprehensive features, ease of use and low cost have been the keys to altering the customer value proposition and attracting consumers online. Music industry change is forced by the need to respond to new challenges or opportunities presented by the external environment, or in anticipation of the need to cope with potential future problems (globalization of markets and internalization of trade). Major competitors within music industry recently develop a completely new model of the supply chain for music which goes ahead all models exciting on the market.
Such change management tools as Fanning’s Napster, Internet shops and open source software represents a planned change which means an intentional attempt to improve, in some important way, the operational effectiveness of music industry. The basic underlying objectives can be seen in general terms as: modifying the behavioral patterns of consumers of music industry; and improving the ability of record companies and singers to cope with changes in economic and business environment.
A change agent is globalization process and new methods of business which require new channels of communication and service (product) delivery (Senior, 2001). The increasing need for change in music industry is cre¬ated by an internal need to improve technology and labor skills; attitudes of employees; size of organization; need to improve performance and reduce errors. For music industry, change is necessary to ensure an adequate supply of products and services to potential consumers. There is, therefore, a continual need for the process of the supply chain development.
Internal need is marked by IT technology as a part of improved organizational performance. The changing nature of business is the growth of service industries and the decline of manufacturing industries. Also, internal driver to change include the potential to reduce number of intermediaries, distribution costs and value-system inefficiency. In contrast to tradition view, control over Internet trade will ensure privacy rights and ownership. Even if record companies do not enter this market, it will not reduce member of unauthorized purchases and piracy.
For a traditional record company, the best approach to change is a network-based approach which ensures information sharing and control. The traditional record company should follow technology change management including new equipment and computer based systems. Also, it will be important to take into account structure of change: ps of control and authority delegation. The change entails developing a business process model of how activities function, analyzing relationships among business units, and implementing changes that would eliminate redundant processes and make business units more effective.
Following examples of book sellers, the music record company can host a forum for customers to swap information and suggestions, including prices, which brand of buy. Components of the demand chain include: the marketing and promotion of products and services; the acceptance of orders for these products and services; the process of paying for these orders; the actual delivery of the products and services; and the support for the products and services. The major steps (Hammer, Champy, 1993) for change business processes include: (1) develop the business vision and process objectives.
For example, the traditional record company should look for breakthroughs to lower costs and accelerate service that would enable the firm to regain its competitive stature in the music industry. The goal of change is to enter Internet market and ensure competitive position of the company; (2) identify the processes to be redesigned (structure of sales and new market segmentation). The traditional record company should identify a few core business processes to be redesigned, focusing on those with the greatest potential payback.
Marketing material can include graphics, animation, video and audio to create a compelling multimedia presentation. Brand-based online communities have demonstrated the potential benefits of dialogue flowing between consumers; (3) understand and measure the performance of existing processes. For example, the objective of change is to reduce time and cost in developing a new Internet service the record company needs to measure the time and cost consumed by the unchanged process; (4) identify the opportunities for applying new technology.
The main opportunities are control over Internet market and cooperation with other companies, on-line communities and functionality (Robbins 2002). Also, the traditional music company will be able to establish power relations with customers and create its unique image. The change implementation can be based on a famous Kurt Lewin’s model of change. According to this model, phase 1 will occur where the company senses the need to do work in a different way. This stage is inevitable, because changing technology within the music industry requires changing methods of marketing in order to meet high standards of service.
Phase 2 - of the change process begins while changes are being made in the behavior of employees and in the organizational process. Such changes will be made subject to the staff being convinced of potential better results by the new system. Phase 3 - of the change process is called re-freezing, and is when the changes are accepted as the new position by the persons most affected by the change (Lewin, 2006). The new program can be based on CRM software solutions aimed to improve service quality and reduce error reduction.
Changes in technology and Internet services can be ab¬sorbed, deflected, and defeated by employees and customers. In this model, the only way to bring about change is to change the technol¬ogy, tasks, structure, and people simultaneously. Some authors have spoken about the need to "unfreeze" organizations before introducing an innovation, quickly im¬plementing it, and "re-freezing" or institutionalizing the change (Senior, 2001). On-line type of promotion and on-line music catalogues can help to attract new and inform the old customers about new products and concerts.
For instance, the slogan “we have everything you are looking for” etc, will help to create a strong image. A subscription-based approach will help to create ‘exclusive culture’ for music funs. Within organization, only in job enrichment does an operative get the chance to discuss with management ways of re¬organizing the work: Creates a working environment in which formal authority is supplemented by authority based upon knowledge and skill; Increases the job satisfaction and enthusiasm of employees and encourages open communication.
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