Case study: Feedback

The following comments are provided as food for thought. Different interpretations are, of course, possible.

What do you think the main reasons were for the change announced by the board of Xchem? Xchem has initiated a change that can be seen in many large global organizations. The global model of the past involved key functions of country operations being managed by central teams of experts. This proved expensive, with high salaries and travel costs. Also, the central team slowly began to lose touch with the local markets, which led to reduced revenues and profits.

The change aims to give authority to local organizations to manage their markets and operations better — at lower cost and more closely aligned to local market needs.

The smaller central team will offer support where needed, and encourage the sharing of experiences across borders and standardized reporting.

How well has Lotte responded to the planned changes?

Lotte seems to be in the early stages of the change process, suffering from shock and anger, and expressing some denial. This response is natural to some extent. It is also supported by logical concerns of a threat to the quality of local health and safety, and a reduction in her ability to influence the new local heads.

But it is important for Lotte to engage more deeply with the logic of the change and to step into a leadership role so that she, Jenny and the team can manage the change in the best way possible. How well does Jenny handle Lotte’s reservations during the call?

Jenny has already announced the change to her team but it is clear that Lotte lacks a clear framework for understanding the logic, the schedule and the future relationships in the organization.

We don’t know whether Jenny didn’t explain the changes well or whether Lotte simply failed to listen. In the call, however, Jenny risks alienating Lotte by constantly contradicting her concerns, labelling her as “negative” and giving the impression that she has other, more important priorities.

What other steps should Jenny take to manage her team through the change process?

First of all, Jenny needs to find the time to talk through fully with her team the logic and benefits — both individual and team-related — of the planned changes.

She also needs to plan, as far as possible, how best to implement the new structure in a realistic and efficient way to ensure that her team is not overloaded when managing the handover to local operations.

She needs to ensure that the handover is customized to the competence levels of the newly recruited local health-and-safety heads, and that health and safety is not compromised during the process. It would probably be best for Jenny to design this process with her team, to allow it to manage the change in an effective and efficient way.

Importantly, she needs to clarify as soon as possible the future staffing level in the central team. It is important to be transparent about job losses if they are to happen.

Jenny Brucker is leading a virtual team of international health-and-safety experts working for Xchem, a chemical company near Frankfurt. The team members are located in Germany (two people), Sweden (three people) and Finland (one person). In the past, the team was responsible for 23 countries, providing health-and-safety advice and support to local production sites. The country responsibilities were divided among the team members, who worked closely with the COO in each country.

To increase local accountability and bring local business units closer to their customers, a new structure has been announced by the global board. Local health-and-safety heads will be appointed, who will report to their local COOS. The international team is to be reduced, though details have not yet been specified. The plan is to reduce costs and to focus the remaining central team on more strategic areas, monitoring the local health-and-safety heads and ensuring the sharing of best practices between the countries, and common reporting practices.

The day after she announced the planned changes in a meeting, Jenny is discussing them on the phone with Lotte Lindqvist, from her Swedish team.

Lotte: So, what’s going to happen and when? I’m really worried about all this.

Jenny: Lotte, you need to be patient. The new structure was announced by the global board only last week. I don’t have all the details myself.

Lotte: But the announcement was clear. We’re losing all our countries and probably our jobs. Jenny: You’re not losing your countries. The country responsibility is moving more to the new local heads. The central team will get new responsibilities. And there has been no decision on job losses yet either. Lotte: But it can’t work. The local countries are never going to be able to recruit the right experts in such a short time. Even if they can, it will take years to understand the different production technologies. I think this could really seriously impact safety in some of the plants.

Jenny: It will be our role in the central team to support them. We have the expertise and this will be part of our role going forward.

Lotte: But the new heads report to the local COO and not to us, so that won’t work either. How will we get them to listen to us if we don’t have any authority? It’s just crazy. Jenny: Look, I don’t have time now to go into detail, but you have to get rid of this negativity. I told the team yesterday that this was an opportunity, but I’m only hearing problems. Let me put it on the agenda for our team meeting next week.

Lotte: I’m not being negative. I’m being practical. Jenny: OK, we’ll discuss it next week. I have to run to my next meeting. I don’t have time for this right now.

What to think about

What do you think the main reasons were for the change announced by the board of Xchem?

How well has Lotte responded to the planned changes?

How well does Jenny handle Lotte’s reservations during the call?

What other steps should Jenny take to manage her team through the change process? You will find our feedback on page 40