Ajax Minerals and Perrier
- Pages: 6
- Word count: 1337
- Category: Management
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Change is an occurrence that happens in every moment of every day. Sometimes it can be subtle and no one is the wiser. However, when organizations change, subtle or otherwise, resistance is futile. In the paragraphs to follow, this paper will examine resistance to change that occurred within the Ajax Minerals exercise, and Perrier case study. This paper will also identify resistance to change within Ajax and Perrier, how the organizations allocated resistance; parallel and differentiate management’s judgment and methods to change; determine which organization allocated change an efficient manner, and whether or not adjustments are warranted to improve the effectiveness of Ajax and Perrier’s strategy.
“Ajax Minerals and Perrier”
Ajax Minerals and Perrier’s resistance to change
Ajax Minerals is a mining company that up until this point had been functioning at maximum volume, with little or no competition. Nevertheless, it was not long before senior leaders learned of another company by the name of Pacific Rim had been planning to mine, and ship the same minerals to the U.S. at a substantially lower rate. Although leaders were quick to see the threat, no one else within the organization did. Employees were used to the consistent workload, in addition to endless overtime, and as long as there was work and overtime, employees were blind to impending obstacles (Palmer, Dunford & Akin, 2009). Situated near Vergèze France, Perrier mineral water originated in 1898, when its mineral water source was purchased by Louis-Eugenè Perrier. Although Perrier has been around since the late 1800’s, it was not until the 1980’s that it became the poster child for mineral water.
By 1989, 1.2 billion bottles had been sold worldwide. In 1990, the discovery of trace amounts of benzene in the bottles brought sales to a screeching halt in the U.S. in the early 1990’s. However, Nestlé, seeing an opportunity to expand on its bottled water enterprise, purchased Perrier sometime in 1992 (Palmer, Dunford, & Akin, 2009). Nevertheless, even with new management Perrier struggled to be a profitable enterprise. Production consistently lagged behind Nestlé’s two other mineral water brands, Vittel and Contrex. Not to mention, leaders consistently met with resistance from laborers under contract with the CGT union, who represented 93 percent of Perrier’s work force at that time. Sadly, leadership’s attempts to communicate the need to improve their financial performance only met with contempt (Tomlinson, 2004).
Change tends to be a driving force behind an employee’s suspicion and trepidation towards change. Ajax’s sources of resistance come in the form of anxiety and insecurity, whereas Perrier’s sources come in the form of conflict and indecisive communication. In the case of Ajax minerals, the relationship between leaders and employees was already volatile, and impending changes only exasperated the existing tension between them. As for Perrier, employees did not see a need for change, nor did they like change, and none of them felt that it was the right time for change (Palmer, Dunford, & Akin, 2009). Although inconsistencies in communication is what shattered management and employee relations, it also intensified resistance.
Consistent gaps in the organization’s vision, and change management processes also brought on resistance. However, the discrepancies in the change management standards, and flawed implementations also provided barriers as well. If leadership enlisted in healthy communication strategies, it would have reduced employees’ fear of or resistance to change. Leader’s needed to realize that they would have to eliminate barriers to establish an optimistic transformation. An organization’s transparency regarding forthcoming changes, as well as communicating the change process would have eliminated some of the resistance, and many of the barriers (Warrilow, n.d.). Management’s diagnosis and approach to change
Organizations have difficulty avoiding change, because innovative concepts encourage expansion. Whether change is occurring due to a change in employee’s roles, new technology, funding issues, or trying to establish new customers, it creates new opportunities. However, in most cases, though, change is met with disapproval, resistance, or both (Brookins, 2014). In order for leaders to deal with change, they need to make their own changes. For instance, in response to fallout from previous change experiences, Ajax leaders decided to establish a more collaborative effort by involving its managers and supervisors in their change strategy. Instead of doing all of the planning behind closed doors, they became transparent about the need for change, and allowed managers, as well as supervisors to become a part of the solution. Leaders provided information regarding other organizations going through similar competitive issues, and how badly the outcomes were when these organizations failed to ignore the need for a more competitive edge.
Leaders also allowed employees access the organization’s financial performance information, in addition to meeting with them regularly to share crucial financial information (Palmer, Dunford, & Akin, 2009). On the other hand, Perrier’s approach to change was to stand firm, and take a more assertive approach with the employees and CGT. Faced with substantial losses from unfavorable corruption issues, in addition to other sordid discrepancies, leaders voiced their intentions to initiate a reduction in force over a 14 year-period, and only keeping 1600 employees once Nestlé inherited the organization in 1992 (Palmer, Dunford, & Akin, 2009). Clearly, Ajax’s change strategy was more effective that Perrier’s. In order for an organization to prosper, fully depends on its employees and their commitment to cultivating performance and productivity. Leaders listened to what their employees were asking, began communicating effectively, and by doing so it not only improved their work relationships and empowered employees, it also boosted their confidence levels (Palmer, Dunford, & Akin, 2009). Adjustments to Ajax and Perrier’s change strategy
Ajax’s change strategy was resourceful and assertive in providing suitable results. However, management did have to compromise, and may have given the employees too much opportunity and too much power. Nevertheless, in order to get past these issues it is suggested that Ajax should use the situational approach by encouraging communication and education; involvement and participation; support and facilitation; agreement and negotiation; cooptation and manipulation; and implicit and explicit coercion. Of the six approaches just listed, Ajax did engage in five of them. For instance, they organized informational meetings, became transparent with their financial information, enabled and supported employees, rectified employee relationships, and became more flexible (Palmer, Dunford, & Akin, 2009). Still, Ajax must be good stewards and create positive relationships with its employees.
Unfortunately, employees were manipulated in a negative manor. Performance measures should be implemented, and criteria for employee evaluations should include objectives and goals, and scored accordingly. Salary increases could be based on the employee’s score. High performers who score well get an increase. Low performers will be given an action plan, and an opportunity to improve. Those who do not improve in the allotted time frame will go through the termination process. Eliminating the negative factors will bring about positive outcomes (Palmer, Dunford, & Akin, 2009). Perrier, on the other hand, should have been aware what they were about to endure. Their change process could have been a more collaborative one.
Perrier’s transformation was chaotic and turbulent to say the least. There was no communication or education on their part, nor was there participation or involvement. Not one manager facilitated a meeting or supported any of the employees. As far as negotiation and agreement, it was non-existent. Explicit and implicit coercion brought animosity (Palmer, Dunford, & Akin, 2009). Nevertheless, Perrier could have used the consultation and openness approach. By consulting with CGT and its members, could have resulted in positive outcomes. Even if they agreed to disagree, it would have hampered some of the conflict between them. Perrier could have also taken the route that Ajax did, and allow employees access to financial information. If employees could see for themselves why the changes were necessary, they might be encouraged to work harder and increase their productivity levels (Palmer, Dunford, & Akin, 2009).
Brookins, M. (2014). What Causes Resistance to Change in an Organization? Retrieved on November 22, 2014, from http://smallbusiness.chron.com/causes-resistance-change-organization-347.html Palmer, I., Dunford, R., & Akin, G. (2009). Managing organizational change: