Change Management Consulting Case Study

Change in Business Consulting Inc. Professor Gunhold Case Study

Introduction

Overview of Business Consulting Inc.

Analysis of current work situation

Strengths

Weaknesses

Improvement plan

Organizational action plan

Timeline for completion

Conclusion and References

Background - Business Consulting Inc.

Rated an “A+”by the Better Business Bureau, Business Consulting Inc. opened its doors in 1983.

Offering public and private accounting and consulting services, Business Consulting Inc. has grown from a start-up company with 1 employee to a mature business with 7 employees.

As the original owner aged, the business has aged with him.

Now faced with retirement of the principal owner, Business Consulting Inc. is in the aristocracy phase of organizational development.

Change is necessary in order for Business Consulting Inc. to remain competitive.

What is Business Consulting?

Business consulting is the process of meeting clients’ business needs.

These include:

Basic: Required to meet governmental, banking, and other regulations and agreements.

Dynamic: Different industries require businesses to have different needs.

Timely: Governmental tax reporting, payments of loan installments, etc. have required filing and remittance deadlines.

Activities Specific to Business Consulting Inc.

Provide small business clients with accounting, payroll, and tax reporting support.

Fulfill governmental requirements such as liquor license applications.

Perform lease and loan agreement reviews.

Services are dynamic based upon the needs of the clients.

Client base is comprised of businesses in Washington, Oregon, Iowa, Idaho, Wisconsin, and Florida.

Analysis of Current Work Situation

Accounting (Approximately 80% of the volume of work/tasks performed):

Timely filing of tax reporting and any required remittance such as quarterly IRS Employer’s Quarterly Federal Tax Return (reconciliation of FICA and FIT withheld and remitted).

Accountants Payable: Invoices vouchered and paid promptly to vendors; this improves relationships and there are no service disruptions.

Payrolls are processed for business clients.

Tax Reporting (annual):

Corporation, LLC, and other tax filing requirements.

Individual: based upon the business tax filing status, personal tax returns are processed.

Reviews and/or assistance of preparation of contractual requirements: lease agreements, loans, state liquor license applications, and other state, county, or city requirements.

Strengths

Strengths of the firm include:

No hourly fees.

Outside of the corporate and personal tax filing windows (March and April 15 th , respectively), no appointments are necessary, and even so, Business Consulting Inc. encourages walk-in clients.

Owners of the firm are an EA (licensed Enrolled Agent in the State of Washington authorized to practice tax law before the IRS) and a CPA – there is experience in the field of accounting and tax.

Experience – current management has 20 years of combined business consulting experience.

Solid customer base.

Weaknesses

Internal and external weaknesses of the firm include:

Internal:

Uneven volume of work. Reactionary response to unscheduled work.

No clear marketing strategy.

Employee culture & vision is unclear.

Lack of employee training.

Inefficient systems & processes.

External:

Stagnant client base.

Technological changes.

Legislation.

Theory of Lifecycle Change

As the business grows and matures it inevitably changes.

Changes are built upon a groundwork of earlier stages.

5 stages in an organization’s life cycle include: the startup phase, direction, delegation , coordination, and collaboration.

Business Inc. - Problems Associated with Lifecycle Stagnation

Slow and unexciting.

Losing market share to competitors, new technologies and trends.

Doubts, problems, threats and internal issues overshadow the original purposes.

Inward-focused administration seeking exit and divestment.

Many operating and marketing challenges (Adizes, 2006).

Improvement Plan

How to Grow:

Leverage current offering to enter a new market or to expand the reach in existing market.

Develop a new offering.

Perform market research.

Increase advertising.

Improvement Plan (cont.)

How to Maintain:

Add value.

Attract and retain great people.

Constantly adjust to changing realities.

Maintain a nimble culture that pays attention to environmental and market changes.

Incentives and rewards for successful change and adaptation.

Leverage current offering to enter a new market or expand the reach in existing market.

Improvement Plan (cont.)

How to Combat Stagnation:

Go back to basics and focus on core business activities.

Pause and evaluate current practices.

Simplify business processes in order to increase growth.

Key Metrics to Measure Success

Track sales of new offerings.

Measure additional client base generated from new advertising.

Create metrics to show efficiencies gained from refined business processes.

Creating an Improvement Plan

Satir Change Model

Stage 1 Late Status Quo:

Stakeholders’ survey to solicit feedback on strengths, weaknesses, mission, objectives, critical success factors, and needed changes.

Have feedback visually and physically available for stakeholders to discuss in an honest, open forum.

Define the mission and objectives of the organization, and discuss implementation strategies.

Creating an Improvement Plan (cont.)

Stage 2 Resistance:

Based on meeting feedback, compile a plan based on the group consensus.

Distribute this plan to the group in advance of a meeting to provide time for reflection.

At the meeting, present and discuss the plan as a group. Further refine the change model to fit the organization as defined by the business mission, objectives and stakeholders involved.

Encourage open communication of both positive and negative opinions and views.

Engage the group as owner of the plan.

Organizational Action Plan

Stage 3 Chaos:

“ Use a systematic approach to change that is focused on outcomes” (IBM, 2008, p 3).

Staff must find a “safe environment that enables them to focus on their feelings, acknowledge their fear, and use their support systems” to overcome the newness of change until they have assimilated to integration, competence, and confidence (Smith, 2008).

Management must allow staff to learn through the process and should not seek to rescue or alleviate the initial pain of learning change; this would “short circuit” the learning stage of successful change implementation (Smith, 2008).

Integration

Stage 4 Integration:

Leverage resources appropriately to demonstrate top management skills (IBM, 2008, p. 3).

Change managers must work to “offer reassurance” and also help their staff to “[find] new methods for coping with difficulties” (Smith, 2008).

Stage 5 New Status Quo:

Management must provide an environment of “[safety]” and encouragement so staff “can practice” their learning of change for successful implementation, skill building, and refinement (Smith, 2008).

Timeline - Tasks

Timeline - Calendar

Overview of Critical Components in Change Theory

Define the change.

Seek stakeholder input.

Formulate a plan.

Communicate the plan.

Seek additional stakeholder input.

Implement the plan.

Continuously document process and communicate with stakeholders.

Make changes as necessary during the process (Hayes, 2009).

Conclusion

The authors of Making Change Work (2008) note that success depends largely on people (pg. 4). The continued viability of Business Consulting Inc. depends upon timely and thoughtful execution of these strategies.