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- Managing Change
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- University Of Winchester (UoW)
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Managing Change(Women on Business, 2018)
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,Table of Contents
Part 1: Open System for Nokia...............................................................................................................2
Part 2: Change Plan for Fizz Event Management...................................................................................7
Part 3: Supporting Middle Managers...................................................................................................11
Part 4: Reflection on Change Management.........................................................................................13
References...........................................................................................................................................15
Appendices..........................................................................................................................................22
Appendix 1 – Common Defence Mechanisms.....................................................................................22
Appendix 2 – Schwartz Values Questionnaire......................................................................................23
Appendix 3 – Motivational Types Questionnaire.................................................................................27
Appendix 4 – Leadership Style Questionnaire.....................................................................................29
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,Part 1: Open System for Nokia
This section will argue that Nokia has failed to adapt to change by having internal organisation
focused on incremental change rather than transformational change (Doz, 2017). Therefore, this
section proposes the appliance of Nadler and Tushman’s Open System theory that determines
Nokia's organisational environment from internal and external alignment point of view. The Open
System take into account resources and information from the environment then convert these
resources into outputs and constantly monitor external environment in order to improve and adapt
to changes (Nadler and Tushman, 1980).
Nokia has a long history of success. Company's shift towards telecommunications began in the
1990's and by 1998 Nokia (2020) became the best-selling mobile phone brand around the globe. By
2007, 'Nokia accounted for more than 40% of mobile phone sales worldwide' (FRPT, 2014). However,
entrepreneurial thinking of mobile giant Apple helped shift consumer focus towards touchscreen
phones quicker than Nokia (Doz, 2017). In regard to inputs, Nokia's CEO at the time Stephen Elop
and his management had poor alignment between external environment and organisation, known as
the Congruency theory (Nadler and Tushman, 1980). For example, company's culture changed when
it was sold to Microsoft Corporation and once leading Nokia’s hardware platform Symbian was no
longer competitive in leading markets (Savitz, 2011). The platform failed to meet customer
requirements and phone models been delayed as a result of this (Doz, 2017). The graph below
shows a steep decline in market share of Symbian, in comparison with other platforms (Hamburger,
2011). This links to the Open System theory, outputs are outcomes of lost market share and
decreasing brand’s reputation (Nadler and Tushman, 1980).
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, The reason why Nokia failed to adapt to change was due to formal organisation falling into The Trap
of Success which is the opposite of Open System’s theory, known as Closed System (Nadler et al.,
1995). Formal organisation knew that they needed a more advanced operating system to match
Apple's iOS but feared that the developing would take several years, decrease profits in the short-
term and shatter internal morale of an organisation (Vuori and Huy, 2016). Nokia has denied support
from Vodafone and other European operators, which would have benefited users by providing user
experience and technology standards. As a formal organisation Nokia had strong defence
mechanisms against anyone but Nokia (Blakeley, 2007). Company's inability to create radical
innovations and focus on incremental innovations, such as phone features and forms only prompted
Apple to change the revenue model in the ecosystem, obtain Nokia's refused operators and achieve
competitive advantage (INSEAD, 2020). Apple had a lead in the touchscreens, software applications
and 3D interfaces, whereas Nokia's top management rejected R&D proposals to design online
applications store as well as improve Symbian operating system (O’Brien, 2010 and Aspara et al.,
2011). The reason why 3D user interface for Symbian handsets proposal failed was because top
management refused to spend $2.05 for production costs to each handset (O’Brien, 2010).
According to Nadler et al. (1995, cited in Matali, 2010), this is an example of a 'learning disabled'
organisation. Nokia's certainty that external environment does not affect them, unwillingness to
reflect on success and failure as well as unacceptance of new ideas has led to the 'death spiral'. In
addition, this success syndrome has resulted in less innovation and lost customer focus (Haanaes
and Reeves, 2016). According to O’Dea (2020), Nokia’s sales have dropped from 2007 51 billion
euros to 23 billion euros in 2019. Net income graph below, shows a drop in profits and economically
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