IMPACT OF CHANGE MANAGEMENT ON THE PERFORMANCE OF EMPLOYEES IN NIGERIAN BREWERY PLC (A CASE STUDY OF LAGOS STATE BRANCH)

CHAPTER ONE

1.0. Introduction

This discussion is centred on analysing and defining the concept of change management on employee’s performance. It discusses the objectives of the critical review, the background of the study, the origin of the concept as well as the factors which are influencing the growth and adoption of the concept by organizations. Change management is a structured approach to transition individuals, teams, and organizations from current state to a desired future state, to fulfil or implement a vision and strategy (Serkin, 2014). It is an organizational process aimed at empowering employees to accept and embrace changes in their current environment (Kubiciek, Margaret 2013). It involves defining and installing new values, attitudes norms and behaviours within an organization that support new ways of doing work and overcome resistant to change.

1.1   Background to the Study

Change is unavoidable and managers all over the world are adjusting to the changing market conditions and at the same time facing the need for generating a proactive rather than a responsive managerial system. They are examining for ways to cope with an increasingly complex technology and more refined labour force or teams. To achieve varied goals, managers need more than fragmentary ad-hoc change programmes dealing only with present challenges. They need change management methods to prepare for upcoming organizational competitive difficulties. Managers must gain knowledge how to build and manage a human group that is proficient of foreseeing the new, capable of changing its vision into technology, products, processes and services, willing and able to agree with the new. Attempts to execute change management have been many and extensive, but the promises made in its name have remained unsatisfied (Dawson, 2013). Influential forces in the environment such as technology, competitors, and regulators amongst others are unceasingly influencing public and private organizations to change permanently present structures, policies, and practices. A major element of change is the application of policies. Implementation is therefore a key concern in the management of change (Pfeffer, 2015). The inability to get things done and have crucial ideas and decisions implemented is widespread in organizations today (Arora, 2009). Recognizing the need for change and leading organizations through that change is one of the most challenging for any leadership. Change is the only constant in today’s life for individuals and organizations. Some changes can be reversible while others are not hence the risk involved in managing change. Change management should be effective, for example have the ability to move freely, have the ability to influence others, and directing the working forces in the target systems and administrative units (Burnes, 2015). Bernstein, (2009) argue that all organizations are currently undergoing some type of change. Many of these change programs arise from management such as culture change, business process engineering, empowerment and total quality. Uncertain economic climate forces many Organisations to make changes in order to survive. Organisations need to react quickly to the revolution in technologies and competition, not only at the global level, but also at the local and national levels, if they want to stay ahead of competition (Edmonds, 2010). According to Robbins and Judge (2009), the dynamic and changing environments which Organisations face today, required adaptation, sometimes calling for deep and rapid responses. "Change or die" is the rallying cry among today's managers worldwide. In the same vein, Buono and Kerber (2010) posited that companies in every industry are increasingly challenged to both respond to, and anticipate continuously changing competitive, market, technological, economic and social conditions to the point where change is described as "the new norm." Organisations of all kinds today have to deal with environments that are changing more rapidly than the Organisations themselves. While the inevitability and benefits of effective change management are non-negotiable, the reality is that about 80% of changes implemented within Organisations fail to achieve the objectives for which they were set (Burnes, 2014). According to Choi and Ruona (2011), despite the increase in the perceived necessity of change and attempts at implementing Organisational change initiative, it has been estimated that, at least, two thirds of Organisational change efforts do not result in their intended aims nor do they foster sustained change. Nigeria, as a member of the international community, has suffered her share of the consequences of the economic meltdown in the forms of declining real output growth (slow economic growth), weakened financial systems (takeovers and bankruptcy), loss of jobs, loss of confidence in the financial markets, leading to inability to carry out their intermediation role in the economy, rising inflation and weak consumer demand (Soludo, 2009). These negative effects have manifested in rising inflation, continued depreciation of the Naira value in the foreign exchange market, sagging consumer demand, changes in government policies as well as increased local and global competition. The above factors have made business operation in Nigeria most challenging. To meet these challenges, Nigerian managers have embarked on several transformation programmes to guarantee the survival and prosperity of their businesses. However, the success of these transformation programmes will depend on the effective management of the entire process. The fact that Organisations must change is no longer news. The real problem is that, in spite of the consciousness of the inevitability of change, and a virtual explosion of research and managerial practice, successful Organisational change often remains elusive (Kind and Wright, 2007). This is because most Organisations "change and die" instead of "changing 'to live."(Okonji 2014) Keller and Aiken (2010) acknowledge that with much research done and information available on managing change, it stands to reason that change programmes today should be more successful than those of more than a decade ago, but the facts suggest otherwise. A review of the relevant literature showed that between 70% and 80% of changes implemented within Organisations fail to achieve the objectives for which they were set (Isem and Pung, 2013; Bokeno, 2008). According to Huy (2015), the poor outcomes of change efforts have posed to management scholars and practitioners alike, the challenge of solving the puzzle of how Organisations can achieve successful changes. The consequences of a transformation failure include: reduced Organisational effectiveness, wasted resources, employee cynicism, dampened employee morale, loss of integrity for those leading the effort and reduced ability to confront and compete in the environment for needed resources and support (Iyayi, 2011). Organisations, failing to introduce change successfully can pay a high price; failure can lead to loss of market position, and the credibility with stakeholders as well as decreased morale among management and staff, resulting in a de-motivated workforce or, worse still, the loss of key employees (Edmonds, 2010). This study was guided by some theories. Stakeholder theory is significant in identifying critical stakeholders in the environment of the change management practices in order to define developments for strategy. Moreover, in the contexts of business ethic and corporate social responsibility, stakeholder analysis has been used to identify important areas of concern. The resource-based theory stipulates that in strategic management the fundamental sources and drivers to firm’s competitive advantage and superior performance are mainly associated with the attributes of their resources and capabilities which are valuable and costly to imitate (Mullins, 2012). Companies are operating in a very dynamic marketplace today and this requires the ability to choose the right change opportunities while demonstrating the necessary degree of flexibility to meet the fluid requirements of the organization over time (Barbaroux, 2011). The ability to select change management initiatives that are aligned with the organizations strategic direction is fundamental for success. According to Thompson (2012), strategic change arises out of the need for organization to exploit existing or emerging opportunities and deal with threats in the market. The Nigerian brewery industry has not been left behind in this process.

1.2   Statement of the Problem

One commonly used definition of “Managing change” refers to making of change in the planned and systematic manners with both parallel and sequential steps designed as part of a comprehensive change management strategy. Basically, the objective in organizational change is to effectively implement new approaches, system and solutions in ongoing and functioning organization. Change is often viewed as problem, organizations faces and how to motivate employees because of different output level (performance) by various employees, some perform extremely better than others the problem of job satisfaction range from poor pay, poor welfare scheme, poor health and transport programme and lack of habitable accommodation for staff. Each change has consequences and implications, and one of the most important results of every process of change is a making a positive change in performance, through services provided by the recipient through their employees, the role of management is to systematically change work to convince workers of the importance of the change process role to reach the desired goals, Nigerian brewery have passed a series of changes in organizational structure, change in technology and in individuals.

1.3     Objective of the Study

The major purpose of this study is to examine the impact of change management on the performance of employees. Other general objectives of the study are:

1. To examine the impact of leadership change on Employee Performance in Nigerian Brewery
2. To examine the impact of change in technology on employee performance in Nigerian Brewery
3. To examine the impact of change in organization structure on employee performance
4. To examine the benefits and challenges of change management on employee performance in Nigerian Brewery
5. To find out the relationship between change management on employee performance in Nigerian Brewery
6. To find out the reasons for managers and employees resistance to change.

1.4   Research Questions

1. What is the impact of leadership change on Employee Performance in Nigerian Brewery?
2. What is the impact of change in technology on employee performance in Nigerian Brewery?
3. What is the impact of change in organization structure on employee performance?
4. What are the benefits and challenges of change management on employee performance in Nigerian Brewery?
5. What is the relationship between change management on employee performance in Nigerian Brewery?
6. What are the reasons for managers and employees resistance to change?

1.5   Hypothesis

Hypothesis 1

H0: There is no significant impact of change management on the performance of employees in Nigerian Brewery.

H1: There is a significant impact of change management on the performance of employees in Nigerian Brewery.

Hypothesis 2

H0: There is no relationship between change management and the performance of employees in Nigerian Brewery.

H1: There is a significant relationship between change management and the performance of employees in Nigerian Brewery.

1.6   Significance of the Study

The significance of the study cannot be over emphasized, the management of Nigerian Brewery would benefit from the study, because it will enable them to know the reason for organizational change and the employees will also see the need to adapt to change so as to increase their performance and productivity. The reason is that business world is moving fast and any organization that fail to recognize change will not be able to compete in business environment. The work will serve as source of references for future researchers that may like to further studying on the subject matter.

1.7   Scope of the Study

The study is based on the impact of change management on the performance of employees in Nigerian Brewery Plc, case study of Lagos state.

1.8   Operational Definition of Terms

Change: The Oxford Dictionary defines change as an act or process through which something becomes different. Organisational change is the movement of an organisation away from its present state and toward some future state to increase effectiveness (George and Jones, 2009).

Management: Management is a practice which involves directing, organizing, and developing people, technology, and financial resources to effectively achieve organizational objectives (Robbins, 2011). The importance of management can never be overemphasised as the success of an organisation is attributed to sound management. The key management functions which include planning, organizing, delegating, communicating clearly, motivating employees, adapting to change and constantly generating innovative ideas are therefore crucial (Sidikova, 2011).

Change Management: Change management is an approach to transitioning individuals, teams and organisations to a desired future state (Kotter, 2011). The English Collins dictionary defines change management as a style of management that aims to encourage organisations and individuals to deal effectively with the changes taking place in their work.