Plan for Organizational Development and Change in Queensland Rail - Case Study Example

Organizational Change and Development Name: Tutor: Course: Date: Introduction The aim of this essay is to provide a plan for organizational development and change in Queensland Rail (QR) from the perspective of the change agent. QR provides railway transport to freight, passengers, and coal and minerals in the state of Queensland, Australia (Gollogly & Callan, 1995). The functional organization has been making losses and consequently lagged behind in transformational change compared to other railway systems in Victoria and New South Wales. Some dramatic changes will be suggested to help QR move away from status quo, improve customer service, cut operational costs and become a world class competitor. The suggested changes will require organizational change readiness, communication and an evaluation program to assess change outcomes (Norburtus, 2007). Summary of Case Context Queensland Rail (QR) is a public transport company and railway infrastructure in Queensland, Australia. The railway system not only provides transportation of coal and minerals, passengers and freight goods in the state but also connects transport services to the neighboring Australian states (Gollogly & Callan, 1995). The railway company has under pressure by the state and federal government to embrace change after being associated with loss making in freight and passenger services. The change desired is an overhaul of organizational culture and structure to drive up productivity, profitability and improve the reputation of the company. Queensland Rail is a bureaucratic public organization with functional units and nine reporting levels (Black & Nijkamp, 2002). Accountability and authority are vested in five centralized functions while recruitment, training, and promotion are internal reflective of restrictive employee diversity. By 1990, the organization had 20,000 employees but making a loss of AUD$133 million and a large capital debt. Coal and minerals transportation made a profit of 140 percent while country passenger services and non-bulk general freight made a loss of $50 million and $140 million respectively in 1989-1990. These losses were attributed to human resource failures and late adoption of transformative change. The unions and management converge with inflexible attitudes hence creating short-term and third best solutions for an organization already plagued in inefficiency, loss making and diminishing market share (Bradford & Burke, 2005). The Development/Change Plan and Process Diagnosis of the Problem Queensland Rail has been associated with losses and diminishing market share in the state of Queensland and Australia at large. The State and Federal governments have been concerned with the performance of the business and demand a corporate turnaround to achieve positive and substantial change (Gollogly & Callan, 1995). The real change required from QR has lagged behind those of other states because of the influence of profitable coal traffic, geographic and economic separation. The functional organization had limited product range, selective recruitment, low staff mobility and lack of competition in the marketplace. Entrenched public service attitudes focused on service and little involvement in organizational decision-making and strategic planning. Human resource functions were separate and uncoordinated with the primary focus on routine administrative duties. Most managers lacked formal training on planning and human resource functions but were committed to short-term business objectives on needs basis (Gollogly & Callan, 1995). Training was more on technical and productivity based and less attention given to the development of people-skills competencies among line operators and managers. The organization lacked the ‘right to hire and fire’ policy and used by the government to hire the unskilled and ineffective workers. Workers believed their jobs were tenable and made it difficult for managers to supervise and control supported by strong unions (Gollogly & Callan, 1995). Approach to the Change Task The change in QR requires a turnaround in organizational culture, structure, controls and management style. An appropriate approach to the task is reducing the number of employees by 30 percent from 20,000 to 14, 000 through voluntary early retirement. Expansion of product range strategy will include an introduction of eco-tourism to transport local and foreign visitors besides the normal passenger traffic while maximizing efficiency on coal and minerals traffic. Sims (2006) suggests that recruitment that is open and conducts its affairs in transparent manner changes the attitudes of employees. QR management board needs to outsource from hiring organizations so as to create open and transparent recruitment process. The management style should be changed from a functional structure to coaching and pacesetting styles to improve on corporate values, attitudes and controls. The top management should be hired from professional and successful organizations not necessarily linked to rail transport but have a general knowledge on transport operations. The top-notch management hired must be able to establish not only promotions and reward programs but also an exchange training programs with other rail systems such as Victoria and New South Wales. Overall, a business process change management strategy is required to drive QR into a world-class competitor, cut operational costs and dramatically improve its customer service. Business processes need to be radically restructured to bring about and holistic focus on business objectives and encourage full-scale recreation of railway transportation and eco-tourism. A business transformation strategy agrees with some of the major changes required in QR. To become a world class competitor, there is a need to move away from the functional and dictatorial styles to coaching and pace setting management styles. Previously, employees in the operations and customer-facing lines performed tasks out of compulsion and lacked motivation to bring out their best productivity. There was no coordination in management levels and often lower level employees felt disconnected with the organizational direction and objectives. A related change would involve adopting a matrix management structure of three levels (management, coordination, and business) to reduce communication distance and create more contact between the management and lower level employees. Through coaching and pacesetting, the top-notch managers will shift from authority and obedience to long-term professional employee development to accomplishment of tasks (Alvesson, 2007). The matrix management structure will diffuse a cultural change in which employees have an orientation of great customer service, reliability and assurance to all external and internal customers (Fiol et al. 1999). The business transformation strategy will also develop a strategic human resource function that plans and budgets for professional employee development, employee medical insurance, attitude change and training, industrial relations and focus on occupational health and safety. Professional recruitment in QR has been ignored for many years hence creating a perception among the Queensland communities that the organizational belongs to ‘QR families’. Employees have an attitude that they will not be fired under any circumstance while lack of competitive hiring has made QR be seen as an employer of losers and academic failures. Hiring a professional CEO from outside the organization with experience and leadership in the successful corporation will help change the attitude and entrenched cultures in QR (Alvesson, 2007). The CEO in consultation with the management board will be responsible for restructuring of business units and levels, developing people skills and core competencies, employee continuous professional development and better remuneration for workers. He or she should plan on voluntary early retirement package instead of forced downsizing that is demoralizing and discriminate. Reducing the number of employees by 6,000 is one way to cut on operational costs and ensure greater attention is optimized in terms of training, promotion, and rewards to few and manageable employees. Ways of creating Readiness and Interventions Successful implementation of the changes in QR requires a critical precursor, organizational readiness for change. Sufficient readiness for change in QR will draw from the Lewin’s three-stage model of change that is unfreeze, change and refreeze (Russell & Russell, 2006). To support this model, the top management must create a motivation for change and readiness by ‘unfreezing’ current mindsets. The strategy will include emphasizing on the rift between desired and current performance levels in which the coal and minerals operations are raking in a profit of 140 percent while freight and passenger services are making losses. The aim is to foment any dissatisfaction that emanates with the status quo such as entrenched QR staff attitudes, accepting the existing profitability and loss levels and diminished brand reputation. The management should also foster confidence that the future state of QR can be achieved and create an attractive vision of the future state of affairs in the organization. Weiner (2009) argues that organizational change readiness is only possible when the members of the organization embrace change efficacy and commitment to implement organizational change and interventions. Organizational staff at all levels must be willing and able by being behaviorally and psychologically prepared to take action (Armenakis et al. 1993). For example, QR staff at lower levels should be invited to a paper survey on employee performance, opinions on desired changes and perceptions on voluntary retirement. This survey will be able to measure their readiness and create a psychological preparedness that major changes are about to happen in the organization. Implementing massive organizational changes requires a shared resolve or teamwork among organizations members including customers and the Queensland government. Organizational members should undergo a dramatic change in intentions, attitudes, and beliefs. For example, QR members should recognize the new organization requires being reliable and responsive to customers, HR to facilitate team meetings and increased employee interactions through an open office system. Employees will be tasked to take pride in their work and portray a greater understanding of their functions and flexibility to respond to contingencies even not falling within their docket (Weiner, 2009). Social cognitive theory opines that a high organizational readiness for change makes organizational members to initiate change in terms of practices, procedures and new policies while exhibiting greater persistence to obstacles and exerting great effort to support the change (Boonstra, 2012). QR organizational members should value the change not because they are obliged or had little choice but that motives of commitment based on ‘want to’ reflect a radical organizational change (Black & Nijkamp, 2002). Handling Communication and Readiness Communication and readiness for change should consider the new hierarchical differentiation such as shop floor employees, supervisors, managers and executives or on other differentiates such as engineers/non-engineers, non-union/union staff (Stevens, 2013). For example, sending written communication through emails to senior staff and memos, Mobile SMSs or town hall meetings to junior staff will affect the ease psychological boundaries across the sub-cultures in the organization. Oral and written persuasive communication is the best strategy for QR since it is the basic explicit information source in terms of efficacy and discrepancy. However, persuasive communication form used can send symbolic information on urgency, prioritization and commitment (Cummings & Worley, 2009). For example, the new QR CEO can visit the employees at their places of work by taking rides at all the wagon classes to discuss the needs for change. The message will be explicitly communicated, and employees will take the comments and symbolic messages as essential to warrant use of resources and time for direct communication. In-person or oral persuasion can involve using the words of the CEO verbatim to describe and emphasize the desired change (Pasmore et al. 2010). Evaluating Change Efforts and Learning Evaluation and assessment of change effort also evokes learning and review of success and pitfalls (Grieves, 2010). Readiness assessment programs are truly a source of evidence to assess the efficacy and discrepancy on state of readiness at QR. Two considerations will guide the QR evaluation program; extent and urgency of change. Extent will be determined through assessment while urgency of change describes the amount of time needed just before changes are executed. The evaluation will exploit interviews and observations to obtain attitudes and opinions of the organizational members. Kotter’s eight-step model will be used to assess and create major changes since resistance to change, and discrepancy may vary from the desired results owing to a partial approach to change (Kotter, 1996). For example, QR should create a climate for change by increasing urgency, getting the right vision, and building a guiding team of say 5 members. It will be important to empower action, create short-term wins and communicate buy-ins. The management should make it stick and not let up for them implement and sustain change outcomes in QR. Conclusion The aim of this essay was to plan for organizational development and change in Queensland Rail (QR). It has obtained that rigorous management style changes, cultural change and adoption of a business transformation strategy is needed to bring about a turnaround in QR. Major changes include a move from bureaucratic to a coaching and pacesetting style, introducing strategic HR functions and outsourcing top-notch employees with people-skills and core competencies in transport operations (Sims, 2006). Organizational change readiness that is widely accepted by all employees is needed for smooth transformation. Persuasive communication is required to communicate symbolic messages and organizational direction in a bid to create efficacy and breach discrepancy in the desired changes (Grieves, 2010). The essay has affirmed that interviews and observations are needed to evaluate both desired and unanticipated outcomes. References Armenakis, A. A., Harris, S. G., & Mossholder, K.W. (1993). Creating Readiness for Organizational Change. Human Relations, 46(6), 681-703. Alvesson, M. (2007). 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