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Kostas N. Pages Published online: 25 Aug Original Articles. The challenge of managing organizational change: Exploring the relationship of re-engineering, developing learning organizations and total quality management. As longtime managers of the production line, their mantra was never to let resources stand idle.

For Small Businesses

Yet the new scheduler was recommending just that, based on signals of actual demand. Top management had to back up.


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It gathered with employees at the plant level and explained the theory of constraints, which promotes a supply chain based on demand, not the maximization of production capacity. When the scheduling system was rolled out a second time, it was a success. The story is told by Dwight Klappich, vice president of Gartner Inc.

He's illustrating a maxim of successful change management: don't forget the human element. Education is one way that companies can enact real change within their supply chains, without falling into the traps set by everyday organizational behavior. No matter how effective the software, or how brilliant the management theory, it can be undermined by a handful of individuals at various levels of a company.

Employees who aren't brought into the process from the very start, or inadequately prepared for change, are time bombs waiting to explode. Sometimes its simply a matter of demonstrating the benefits of change.

Implementing Total Quality Management (TQM) For Your Small Business

Klappich cites another example, of a production scheduler who was convinced that her use of spreadsheets was superior to any newfangled piece of planning software. Working around her to get a small pilot up and running, management was finally able to prove that the new system would actually make her job easier. Companies need to take the time to explain the assumptions behind a change.

Certain types of human behavior, if not anticipated and dealt with from the start, can quickly sabotage a change effort. Originating in the military, the term has begun to catch on in the business world. But it describes a behavior that is probably as old as human society. He likens the people within a defined group to a living organism that will defend itself against external forces-in this case, any kind of supply chain change.

The trick is to manage change simultaneously at all levels of the organization. Black describes four distinct tiers, beginning with those who actually carry out the work of the company. They might be engineers, buyers, assembly-line workers, even the first level of management. Above them is the "superstructure," or middle management. Then come senior executives, and finally, top management.

A successful program of change will address all of those levels, minimizing the communication gaps that naturally occur among them. The problem becomes more acute as companies grow in size. The effort had to be equally focused on people, process and tools. Too often, consultants are brought in to address just one of those elements, or only the top level of management. It might take several years for the message to trickle down to the "doing" level, assuming it ever gets there. Where It Begins A successful program starts with a clear message from senior executives about what they want to achieve, along with the means to carry it out.

But the actual details of execution must come from the bottom up, where employees are closest to the reality of day-to-day operations. Such individuals must be equipped with additional skills, including the fundamentals of Six Sigma, Lean manufacturing, Total Quality Management and business-process reengineering, says Black.

At EADS, that translates into a four-week program which "demonstrates to the operational level that we as a company are prepared to trust them to make improvements happen. Each industry has its own unique challenges, Black says, but in aerospace and defense the watchwords are time, cost and quality.

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Again, all must be attacked at once in order to ensure real transformation. Dallas-based i2 Technologies has worked closely with EADS to ferret out the causes of sub-standard performance, especially poor supply chain planning.


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  5. John Cummings, i2's chief marketing officer, says major software acquisitions can be defeated by a lack of detailed road maps for implementation. Success starts with top management making a good business case for the technology, then working closely with individuals all along the supply chain to put it in place.

    TQM By Definition

    Good organizational design, in which the role and responsibilities of each manager are clearly defined at every stage, is equally important, Cummings says. Enactors of change tend to promise huge benefits and a smooth path to implementation. They should take a more realistic approach, says Cummings. By properly managing expectations, companies can head off some of the opposition that arises when projects fall short of their goals, or hit bumps in the road. At the start of an engagement, Cummings lays out the entire process, complete with milestones along the way. The entire staff was retrained.

    As a result, the airline saw an increase in morale and motivation from their employees. Consider, if you will, the unifying characteristic of the total quality management approach. It, at its core, is a unifying practice in that it requires all staff members to participate and move the company forward.

    Also consider the emphasis put on communication. The case study provided is a perfect example. Before, there was a severe lack of communication at Kenya Airways and the strategy suffered. When employees began to communicate with one another, the direction of the strategy changed and the company began to succeed.

    The Challenge of Change Management

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