Organizational Change Within Business Today

Organizational Change within Business Today

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Company Name: Chevron Corporation

Brand Story:

Chevron Corporation is an American multinational corporation operating in the oil and gas industry. It is one of the oldest oil and gas companies in the U.S, its history dating back to the 18^th century. Chevron is headquartered in San Ramon, California, and operates in more than 180 countries worldwide (Manna, Marco, Letterman, & Mullen, 2014). Chevron is involved in every aspect of oil and gas, from exploration, refining, transportation, marketing, power generation, and chemical manufacturing. Chevron is listed on the New York Stock Exchange market and has over 42,000 employees across 180 countries (Mathews, 2022). This company had total assets of about $239 billion in 2021, with a revenue of $162 billion. Chevron has three main brands: Chevron, Caltex, and Texac (References for Business, 2022). Looking at its assets and revenue, it is obvious that Chevron is one of the world’s largest oil and gas companies and the second biggest in terms of revenue in the U.S.

Scenario 1: Falling Earnings

Prompts/Questions

Response

Identify three key stakeholders impacted; include their roles.

· Employees

Employees are the biggest stakeholders who will be negatively affected when the company’s earnings fall. The company would be forced to lay off a fraction of employees. This would be an abrupt layoff, leaving the employees in a dilemma.

· Suppliers

When the earnings fall, it means that the company has little cash to pay the suppliers. This means that the suppliers’ pay would be delayed.

· Shareholders

Shareholders are among the stakeholders who would suffer when earnings fall. When a company receives little earnings, it means that shareholders would get little dividends.

Identify the top concerns of these stakeholders.

· The main concern of employees is job security. When a company plans to reduce the number of employees, everyone worries about their job security in the future.

· The main concern of the shareholders is the loss of the investment when the company finally collapses due to losses.

· The main concern of the suppliers is the loss of the market of the supplies. When a company’s earnings fall, it means that the company will not be able to order more supplies.

Select which model (i.e., Kotter, Lewin, or ADKAR) should be used to address stakeholder concerns for this scenario. What impact will using this strategy have on organizational outcomes?

Lewin’s model of change management is the most appropriate and applicable to this scenario. Lewin’s model has three steps; unfreezing, changing, and refreezing (Hussain et al., 2018). This model works well in a change that is receiving resistance. In this case, employees would want to resist the idea of layoff, but through the Lewin model, the management would manage them (Hussain et al., 2018). The impact of this model is that it would convince the employees to understand that the identified change is necessary.

Describing how the organization’s management should communicate the implementation of the selected model.

Chevron’s management should not just break the bad news to the employees abruptly but should organize meetings with employees, explaining to them the struggle the company is going through. Then, at a later date, it should announce that the company has been forced to lay off a fraction of employees and that the reasons for the layoff are beyond the company’s control. It should then proceed to effect the layoffs in phases to give employees time to adjust.

Identify what type of leadership personality is required for management to support and sustain the change.

Honesty and Fairness

Chevron’s management should exhibit honesty and fairness when implementing the layoff procedures. It should not lay off employees without good plans and criteria for layoff. It should be genuinely honest and show employees why it has been forced to lay them off. The management should exercise fairness when laying off employees. It should not just dismiss them and forget about them. It should help them adjust and settle after the layoff.

Scenario 2: Acquisition

Prompts/Questions

Response

Identify three key stakeholders impacted; include their roles.

· Shareholders

The acquisition could interfere with the earning stream either positively or negatively. This means that the company may earn more profit or less profit depending on whether the acquisition added value to the revenues. Thus, the shareholders may get more or fewer dividends.

· Employees

The acquisition would likely affect employees since the company would be expanding; some employees could be transferred to new stations or sections. The acquisition could also boost Chevron’s income, meaning that employees are likely to get more salaries.

· Prospective Investors

The acquisition could be affected because of the unpredictability of Chevron’s stock prices. This is because acquisition may either boost or reduce stock prices.

Identify the top concerns of these stakeholders.

· The main concern of stakeholders about acquisition is profitability.

· Employees’ concerns will involve being transferred to new stations.

· Prospective investors’ concern is the unpredictability of the company’s stock prices.

Select which model (i.e., Kotter, Lewin, or ADKAR) should be used to address stakeholder concerns for this scenario. What impact will using this strategy have on organizational outcomes?

Doubt and confusion are the common concerns of all the stakeholders. This means that Kotter’s Model, which has eight steps of change management, would be the most appropriate model that would help to effect the changes (MSG, 2020). The eight steps of this model ensure that the stakeholders want the change. Once they want the change, the management could easily effect the changes. Moreover, the model would address the doubts and confusion among the stakeholders hence creating confidence in them (MSG, 2020). The impact of this model on the organizational outcome is that once the stakeholders are engaged in the change process, they will often be cooperative and welcome the changes.

Describing how the organization’s management should communicate the implementation of the selected model.

· Communicate Early

The management should communicate early to the stakeholders that they will effect the change (acquisition). Early communication prepares the stakeholders in advance to think about the change; hence, they can raise their concerns early enough so that they can be addressed.

· Assure Them of Their Job

The management should inform the stakeholders, such as employees, that the change would be positive and they should not worry; they should assure employees that their jobs are secure.

Management should also help stakeholders welcome the acquisition idea, assuring them that the change would bring positive changes and that everyone would benefit.

Identify what type of leadership personality is required for management to support and sustain the change.

· Effective communication

Chevron leaders need to communicate effectively with the various stakeholders to inform them of updates on the change (acquisition). Effective communication eliminates confusion that may arise because of the change.

· Strategic thinking

Chevron’s leaders need to be strategic thinkers since the process of acquisition is cumbersome and will bring many changes to the organization. Thus, leaders need to think critically and strategically to predict the outcomes of the acquisition to prepare for them.

· Honesty

Honesty is another leadership personality quality needed by Chevron’s leadership. Leaders should be honest in everything they do to earn the trust of all the stakeholders.

· Empower others

Chevron leadership should empower stakeholders such as employees by promoting them to higher ranks when the acquisition has been done and training them on new roles that come with the acquisition.

Scenario 3: CEO Replacement

Prompts/Questions

Response

Identify three key stakeholders impacted; include their roles.

· Top Management

The change in CEO of the company would likely impact the top management. The CEO is the engine of any organization; thus, a change in the CEO would have an impact on the top management. New CEOs come with new strategies, rules, and approaches, meaning that the top managers would be affected by how they are used to working.

· Suppliers

Suppliers are likely to be impacted by the change of the CEO. New CEOs likely come with new thinking, implying that they can think of changing suppliers or renewing contracts with suppliers. Contract renewal may have some changes that could affect how suppliers are used to working.

· Employees

Employees will be greatly affected since the new CEO may come up with new rules. Hence, the normal ways of operations would be affected, meaning that employees will experience new changes. These changes could either be positive or negative depending on how the new CEO behaves.

· Investors

Investors would be impacted because of the change in CEO. The new CEO could bring new approaches to the management, which may affect the profitability of the company; hence, the dividends could either go up or down depending on how the change has impacted the company’s earnings.

Identify the top concerns of these stakeholders.

· The top concern of the top management is the adjustment of the roles in the top management positions. The new CEO may decide to fire or promote some of the top managers.

· The main concern of the employees is the new leadership style that the new CEO may implement.

· The main concern of the investors is the profitability of the company. The investors would want to know if the change in the CEO could interfere with the company’s profitability, which in turn affects the dividends they receive.

· The main concern of the suppliers is contract renewal which will affect the prices of their supplies.

Select which model (i.e., Kotter, Lewin, or ADKAR) should be used to address stakeholder concerns for this scenario. What impact will using this strategy have on organizational outcomes?

The CEO replacement is not a big change, meaning that the ADKAR model of change could be the most appropriate change model to be adopted since big changes might not be tackled with this model (Ahatfix, 2021). ADKAR model tends to focus on goals rather than the path towards the goals. Therefore, the ADKAR model can be an adaptable tool that suits many types of organizations (Ahatfix, 2021). This model has five steps: creating awareness, creating desire, providing knowledge through educating (informing), ability or empowering, and reinforcement.

Describe how the organization’s management should communicate the implementation of the selected model.

· Prompt communication

The management should ensure that they promptly update the stakeholders on the CEO replacement change. Prompt communication would make the stakeholders welcome the change because they will understand the importance of the change and the benefit they will get from it.

· Assuring

The management, through communication, should often assure stakeholders, such as employees and suppliers, that things will be fine even after the CEO’s replacement. Assuring them would remove all the doubts and concerns raised.

· Supporting

Chevron management should be ready to support any stakeholders and address their concerns about the new change that will take place.

Identify what type of leadership personality is required for management to support and sustain the change.

· Empathy

Empathy is one of the leadership traits that Chevron’s leadership should display to effect the changes that will come. Empathy is all about understanding and responding to the emotions of the concerned stakeholders (Nathanson, 2021). Leaders should share the feelings and emotions of how stakeholders, such as employees, feel about the replacement of the current CEO.

· Good Listeners

Chevron’s leadership should be good listeners and listen to the concerns of the stakeholders, such as the suppliers, investors, and employees. Good listening will enable them to digest the concerns and find an appropriate approach to address the raised concerns.

· Teamwork

Teamwork is another leadership personality quality that needs to be displayed by Chevron’s leadership to effect the coming change. The leaders should work as a team to implement the change and make the employees feel engaged in all the activities that lead to the change.

· Respect

Chevron’s leadership should also display respect by respecting and listening to all opinions of the concerned stakeholders (Nathanson, 2021). Respecting people’s views will help in the smooth implementation of the change. Leaders should show respect for the employees’ opinions and address them. Once employees feel that they are respected by their leaders, they will also respect them.

References

Ahatfix. (2021). ADKAR Model: What Is It and How To Use It? Retrieved from https://whatfix.com/blog/adkar-model-what-is-it-and-how-to-use-it/

Hussain, S. et al., (2018). Kurt Lewin’s change model: A critical review of the role of and employee involvement in organizational change. Journal of Innovation & Knowledge. Volume 3, Issue 3, Pages 123-127

Manna, D. R., Marco, G., Letterman, D., & Mullen, J. (2014). Sustainable Case Study: Chevron Corporation. Journal of Sustainability Management (JSM), 2(1), 31–34. https://doi.org/10.19030/jsm.v2i1.8755

Mathews, C. (2022). Chevron Rakes in $15.6 Billion in Annual Profits as Oil Prices Climb. The Wall Street Journal. Retrieved from https://www.wsj.com/articles/chevron-rakes-in-15-6-billion-in-annual-profits-as-oil-prices-climb-11643370301

MSG. (2020). Kotter’s 8-Step Model of Change. Retrieved from https://www.managementstudyguide.com/kotters-8-step-model-of-change.htm

Nathanson. C. (2021). 15 Most Important Personality Traits of Effective Leaders. Retrieved from https://online.jwu.edu/blog/MBA-personality-traits-effective-leaders

References for Business. (2022). Chevron Corporation – Company Profile, Information, Business Description, History, Background Information on Chevron Corporation. Retrieved from https://www.referenceforbusiness.com/history2/40/Chevron-Corporation.html

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Question

The purpose of this assignment is to explore organizational change within business today.

Using what you have learned about organizational change in class and by studying the topic Resources, assume the role of a consultant recommending style/manner or organizational change across three scenarios.

Organizational Change within Business Today

Select a for-profit company publicly traded in the United States to be your client. Conduct research about the company by visiting the company website and obtaining a copy of the annual report. In your research, accomplish the following to include a required mix of six sources, at a minimum:

Explore and cite the company’s website.
Review and cite investor presentations or the most recent letter to shareholders.
Include and cite a minimum of four additional sources in your references list, with at least one from the Wall Street Journal.
Apply in-text citations in the “MGT-325: Benchmark – Three Scenarios of Organizational Change” template to support all claims.
Using information directly from the company, offer recommendations for the following three unique scenarios by applying the Kotter, Lewin, and ADKAR theories to each one:

Scenario 1: Industry and company earnings are falling fast, and the company finds it necessary to execute a three-phase staff reduction plan.
Scenario 2: The company is in the final stages of acquiring a similar company.
Scenario 3: Corporate misconduct requires the immediate replacement of the company’s CEO.
In your role as a consultant, you will make recommendations on the following:

Identifying three key stakeholders who are impacted.
Identifying the top concerns of these stakeholders.
Selecting which model (i.e., Kotter, Lewin, and ADKAR) should be used to address stakeholder concerns for each scenario.
Describe how the organization’s management should communicate the implementation of the selected model.
Identifying what type of leadership personality is required for management to support and sustain the change.
Using what you learned from your research and subsequent analysis, complete the “MGT-325: Benchmark – Three Scenarios of Organizational Change” template by doing the following:

In 150-200 words, write a brand summary for your selected company.
For the five responses required for each of the three scenarios, your responses for each scenario should be 175-200 words (i.e., 525-600 words total).

Organizational Change within Business Today