INFLUENCE OF CHANGE MANAGEMENT STRATEGIES ON PERFORMANCE OF THE MOTOR INDUSTRY IN KENYA: A CASE STUDY OF
ISUZU EAST AFRICA
A RESEARCH PROPOSAL SUBMITTED IN PARTIAL FULFILLMENT FOR THE AWARD OF MASTERS OF BUSINESS ADMINISTRATION (STRATEGIC MANAGEMENT OPTION) OF JOMO KENYATTA UNIVERSITY OF
AGRICULTURE AND TECHNOLOGY
I declare that this research proposal is my original work and has not been presented for a degree in any other university.
This research proposal has been submitted for examination with my approval as a University supervisor
First and foremost I would like to thank the Almighty God whose powerful hand has led me throughout the study period. I also wish to acknowledge the entire JKUAT fraternity and particularly the humble contribution of my university supervisor, Dr. Paul Kariuki for his scholarly comments and value added insights that guided me through the process of writing this research proposal. I would also like to acknowledge the encouragement given by my beloved parents and friends throughout the study period and to all those in one way or another, contributed to the success of this study, I say, “God bless you all abundantly”.
To Professor Jesse Simiyu Machuka (RIP) who foresaw and assured me that I could be anything I wanted and a Bsc. (Biotechnology) should not be a limit to the person I become. My dad Matayo Khisa Musee, OGW (RIP) who could go any length to ensure I got the best in life. I will make you proud gentlemen.
This chapter aims at providing sufficient information for better understanding of the study. It examines the global context and then narrows down to the issues that the study will address. The chapter provides the background information, statement of the problem, research objectives and research questions that underpin the study, significance, scope and limitations of the study.
1.1 Background of the Study
In a world of new technologies, transforming economies, shifting demographics, reforming governments, fluctuating consumer preferences and dynamic competition, it is not a question of whether organizations should change but of where, how and in what direction they must change. Like living things, organizations change is given. Organizations must constantly align themselves with their environments either by reacting to external events or by proactively shaping the businesses in which they operate in (De Wit & Meyer 2010).
Kalshoven (2011) says we live in a constantly changing world as are the organizations within which we work in. Our society is always faced by both unprecedented and planned changes in the environment it occupies. Change is something that forces one out of his comfort zone. Change is either for better or for worse depending on the angle the perceiver views it from. Just like living things organizations experience change as they go through their existence. This can happen as a result of a number of reasons but in the end organizations change how they are structured to better meet their goals and growth.
Strategic change management is the modification or transformation of organizations in order to maintain or improve their effectiveness. This is a deliberate, conscious use of strategies to match the prevailing circumstances and preferences in order to achieve and succeed in attaining the objectives of the organization Mitchell, McKenna & Young, (2007). Change management is the process of continually renewing an organization’s direction, structure, and capabilities to serve the ever-changing needs of external and internal customers’. Transitional change management is the process of managing a person or an organization through change in order to minimize resistance to change while accelerating adoption to change as outlined by practitioners such as Hiatt (2006) and Willocks (2011).
Change can range from an overall organizational level change impacting all the employees in an organization to a process change impacting only on a select group or even an individual. In either case it needs to be appropriately managed. Johnson (2012) emphasize that in managing change one needs to know the key elements to change which include: what is changing, why the change is taking place, who change impacts and how to monitor the changes throughout the process. These elements will help a researcher to identify the training and communication needs and eventually track all the change implementation stages. De Wit, B., & Meyer, R. (2010). notes that a well-managed change ensures that there is an identified Executive Sponsor for the change, leaders understand the shifting roles of sponsors, Implementers Agents and advocates during change and change teams are set up as needed .it also guarantees that change has been effectively established and communicated to everyone and the details of the implementation are generally understood as they emerge and are modified to fit changing circumstances.
1.1.1 Concept of Strategic Change Management
According to Bridges (2011), people react to change in different ways, in what has come to be known as transitioning. Bridges explains this as follows: “Change is not the same as transition. Change is situational: the new site, the new structure, the new team, the new role, the new procedure. Transition is the psychological process people go through to come to terms with the new situation. Remember that change is external and transition is internal.” He further says that the three stages include the ending, the neutral Zone and the new beginning.
According to Carbon (2007), Managing change is a very important factor in the success of every business, since it helps managers think creatively about how they manage change, whilst avoiding many of the pitfalls that other companies have encountered. He further prescribes four key factors for success when implementing change in an organization ranging from the pressure for change demonstrated by senior management and the commitment is very essential, A clear and shared vision and ensuring that you take everyone along, Capacity for change and the need to provide the resources, that’s time and finance to action and performance plan and ensuring that communications channel remain open. He further highlights the dangers when an organization fail to have a good change management process being lack of consistent leadership, demotivated staff kept in the dark, lack of capacity in terms of budget cuts, no spend to save policy, short term approach to investment, stressed out staff working hard just to stand still and lack of initiative to do something different. These they argue leads to a treadmill effect setting up a vicious circle since they will be no time for reflection, planning and learning, no improvement in design and implementing, increasing need to do something and increasing the need to do something.
Claire (2010) says that the success of change depends on people’s willingness to let go their current reality, have an ending got through a confused period in between(hell and the hallway), then a new beginning and illustrates what makes people react to the same environment in different ways and that no matter how good an idea is we will always have early adopters, average adopters and laggards and ultimately the people who work in our organizations want appositive human experience when they are at work. She further demonstrates that a change management methodology enables the implementation and leadership teams to provide appositive experience doing the period of significant change and that by utilizing a solid change management methodology, the organization promotes team communication, safer environment trust and freedom hence a stronger workforce.
According to Hala (2011), it’s very important to adopt the right management strategies. These strategies are integrated, process-oriented conceptual framework consisting of three phases namely knowledge formulation, strategy implementation and status evaluation to overcome resistance.
1.1.1 The Motor Industry in Kenya
Kenya’s GDP per capita is growing very fast. Expenditure on the purchase of cars, motorcycles and other vehicles accounted for 1.5% of total consumer expenditure in 2015 and is expected to remain relatively stable to 2025 as incomes rise. The volume of imported cars and motorcycles has been on the increase due to the availability of attractive credit from financial institutions and the rise of the middle-class, (Schiller & Pillay, 2016). According to the Kenya National Bureau of Statistics (KNBS) the volume of imported vehicles between 2003 and 2012 have grown at over 300% from 33 000 units to 110,474 units (KNBS, 2015). Passenger vehicles were Kenya’s fourth largest import overall in 2014, valued at US$420 million and making up 2.3% of total imports (by value) while commercial vehicles ranked seventh, valued at US$370 million. To date, Kenya is still highly dependent on imports to meet domestic demand, with imports making up 94% of bilateral automotive trade and second-hand vehicles accounting for over 80% of those imports, (Delloitte, 2016).
Because of the regional gateway at the port of Mombasa, 99.9% of Kenya’s automotive exports target other African countries, with Uganda and Tanzania being the biggest markets. Kenya’s automotive market is largely focused on retail and distribution of vehicles, and after-sales support in servicing and spare parts sales (Delloitte, 2016). The main motor vehicle dealers operating within the country are Toyota (East Africa), Cooper Motor Corporation (CMC), Isuzu East Africa (formerly General Motors East Africa), Simba Colt and DT Dobie, Honda Motors, and other small upcoming local dealerships. (KPMG, 2015). Small scale assembly of motor vehicles is done at three assembly plants, the Isuzu East Africa (GMEA) plant in Nairobi, the Associated Vehicle Assemblers (AVA) plant in Mombasa and the Kenya Vehicle Manufacturers (KVM) plant in Thika. All three of the plants are operating below their capacity. However, the country’s good infrastructure, relative to other countries in the region, as well as its physical and strong economic position within the East Africa Community (EAC), make it a potential hub for automotive assembly and production in the region, (Schiller & Pillay, 2016).
1.1.6 Profile of Isuzu East Africa
General Motors Company, the mother company of General Motors East Africa sold its major shareholding of 57.7% to Isuzu Motors Company in February 2017, being all the stake that it had in the local company (Korosec, 2017). This meant that GM officially exited the East African market and Isuzu Japan came into the market. The mother company wanted to concentrate on its profit-making plants rather than have a wide reach with little profit. General Motors East Africa thus rebranded to Isuzu East Africa with a myriad of changes happening within and without the organization.
Isuzu East Africa has a widespread dealer network in the country comprising of seven dealerships that are independent organizations tasked with the sale, distribution and servicing of Isuzu pick-ups, trucks, buses and sport utility vehicles. The seven dealerships are Associated Motors in Nairobi, Eldoret, Meru, Kitale and Mombasa; Ryce Motors Limited in Nairobi and Mombasa; Thika Motor Dealers in Thika, Ruaka, Mlolongo and Machakos; Africa Commercial Motor Group in Nakuru and Kisumu, Kenya Coach Industries in Nairobi, Central Farmers Garage in Nairobi, Bungoma, and Lodwar, and Mangu Auto-Dealers and Bagdas Auto-spares which deal in genuine Isuzu spare parts in Nairobi. The organization is also represented in Uganda by Mac East Africa Uganda and in Tanzania by Quality Automobiles Limited, giving it a wide coverage in Kenya and East Africa at large. The Kenyan government identified the automotive and auto parts industry as a major economic driver in the Kenya National Industrialisation Policy Framework released in 2010, (Delloitte, 2016).
1.2. Statement of the Problem
Strategic change management practices have taken on increasing importance in the performance of motor industry in the last 15 years regarded as a prerequisite for contemporary development around the world (Yokohama, 2016). It draws from the tenets of adopted strategic change management and the motor industry enhancement with a critical characteristic being increase of market share, customer satisfaction and increase of sales (Bryden, 2014). CMC motors (2015) report indicated that effective strategic change management increases performance of motor industry.
Ndunge (2014) conducted a study on Strategic Leadership and Change Management Practices at The Kenya Wildlife Service, Gakuya (2015) carried out a similar study with an aim of identifying the relationship that exists between strategic leadership and how it influences change management in an organization, with a focus on the Chase Bank Kenya Limited. Muthoni (2015) studied The Perceived Role of Strategic Leadership in Strategy Implementation by The Capital Markets Authority, Kenya. None of the studies focused on Strategic leadership and organizational change management at Isuzu east Africa. This study will focus on Isuzu East Africa and the efforts that have been put in place to ensure that the organizational shift is effectively implemented for the better of the organization and its employees. It will also provide suggestions on what the strategic leadership can do better to sustain this change.
The organization has enjoyed market leadership in as far as market share is concerned for a straight six years and seeks to continue with this trend on and on (Daily Nation, 2017). Kotelnikov (2018) defines the market leader as one who is dominant in its industry coupled with a command on substantial market share. He suggests relentless innovation, winning the organization and people, and coming up with daring strategies as the main drivers of sustained market leadership. The study thus aims to investigate the winning strategies Isuzu East Africa has employed to remain at the top and to provide suggestions on what should be done to sustain this trend, if not make it better.
1.3 Objectives of the Study
1.3.1 General Objectives
The purpose of the study will be to establish the influence of change management strategies on performance of the motor industry in Kenya, with a keen focus on Isuzu East Africa.
1.3.2 Specific Objectives
The specific objectives of the study will be to:
i. Examine the influence of strategic leadership on performance of motor industry in Kenya
ii. Determine the influence of strategic resources allocation on performance of motor industry in Kenya
iii. Examine the influence of strategic technological change on performance of motor industry in Kenya.
iv. Explore the influence of strategic organization structure on performance of motor industry in Kenya.
1.4. Research Questions:
The study will be guided by the following research questions:
i. To what extent does strategic leadership influence performance of motor industry in Kenya?
ii. How does the strategic resources allocation influence performance of motor industry in Kenya?
iii. What is the influence of strategic technological change on performance of motor industry in Kenya?
iv. How does strategic organizational structure influence performance of motor industry in Kenya?
1.5 Justification of the Study
A review of empirical literature reveals that studies on public sector finance concentrate on the challenges such as comprehensiveness of the budget; policy based budgeting, execution of the budget, electronic service delivery, independent audit and oversight, legal and institutional framework in the public organizations. Very limited literature exists on the influence of change management strategies on performance of the motor industry This lack of information motivated the study, with specific interest on implementation strategy, resources allocation, leadership and governance and organizational culture.
1.5.1 Practitioners in the motor industry
This study will appeal to practitioners in the motor industry by providing actionable information meant to improve sales and operational performance. By understanding the challenges, they shall be well placed to device and implement strategies geared towards promoting efficiency in sales and operations hence improving the efficiency and effectiveness of the industry.
Findings of this study will appeal to Suppliers in and out of the motor industry who desire to borrow a leaf and use it as a bench mark to satisfy their quest by better understand the operations at Isuzu East Africa and making decisions on future partnerships that are sustainable and collaborative.
Additionally, this study pursues to explore and indicate the significant relationships between the study variables (strategic management practices) and performance in the motor industry. Consequently, the findings from the study will be used, for further reference, by other academicians with the aim of accumulating acquaintance on the existing body of knowledge in the subject area. Scholars will have a better understanding of the influence of strategic change management on the sales and operational performance in the Motor Industry and the study will also stimulate further areas of research.
1.5.4 Policy Makers
The study is also of great benefit to policy makers as it will aid them in making well-versed conclusions on policy concerning procurement practises, comprehend the operations in the motor industry and conceivably consider this information when aligning the private-public sector corporate dealings and obligations.
1.5.5 Managers at Isuzu East Africa
The study aims at providing insightful information that will be vital to the managers at Isuzu East Africa. This will be helpful in guiding shareholders to make conversant decisions and draw attainable strategic change management practices in matters policy and funding. It will also aid in making team friendly policies that will encourage teamwork geared towards realizing efficiency and effectiveness that will eventually endeavour organization triumph.
1.6. Scope of the Study
The aim of the study is to establish the influence of change management strategies on the performance of motor industry in Kenya. The study will be conducted at Isuzu East Africa situated along Mombasa/Enterprise road in Nairobi County. The organization is chosen since its one of the players in the motor industry in Kenya which has shown sustained market leadership over the past six calendar years (KMI, 2018). The study will target a population of eighty (80) respondents which represents a fifth (20%) of all the employees at Isuzu East Africa as the current employee data indicate that the company has 426 employees (Isuzu East Africa Human Resources Department, 2018).
The sampling frame for the study includes top, middle and lower management level. The study will be conducted between September and November 2018. The study will be limited to the strategic management practices variables under study which include; strategic leadership, strategic resource allocation, strategic technological changes and organization structure.
This chapter reviews relevant literature on effective change management strategies and their influence on organizational performance. The chapter develops theoretical review, conceptual framework, empirical review that was used by the study in regard to each variable in the study. The review identifies research gaps and areas that have been recommended for further research.
2.2. Theoretical Framework
This section examines relevant theories to the study variables. According to Kombo and Tromp (2009), a theoretical framework is a collection of interrelated ideas based on theories. It is a reasoned set of prepositions derived from and supported by data or evidence and it accounts for or explains phenomena and attempts to clarify why things are the way they are based on theories. A theory is defined as a reasoned statement which is supported by evidence, meant to explain phenomena (Kombo & Tromp, 2009). It is a systematic explanation of the relationship among phenomena. Mugenda (2008) defines a theory as a framework of explaining phenomena by stating constructs and the laws that inter-relate these constructs to each other.
2.2.1 Contingency Theory of Leadership
The contingency theory of leadership was proposed by the Austrian psychologist Fred Edward Fiedler in 1964 in an article entitled, “A Contingency Model of Leadership Effectiveness.” The theory emphasizes the importance of both the leader’s personality and the situation in which that leader operates. Fiedler and his associates studied leaders in a variety of contexts but mostly in military context and their model is based on their research findings. In a nutshell, the theory claims that there is no best way to organize a corporation, to lead a company, or to make decisions. Rather, the optimal course of action is contingent (dependent) upon the internal and external situation. A contingent leader therefore is one who effectively applies their own style of leadership to the right situation. It is therefore pertinent to state that the environment an organization exists and operates in directly influences how the organizational change will go.
In 1995, General Motors International had concerns about how the used cars segment of the market was eating up its market share of new car sales. Used car providers like CarMax consumed a up to 13 billion dollars’ worth of market share in 1998. This forced the GM Marketing team to do a thorough analysis of the market which took quite long but bore good results. A leasing model was developed to enable people who couldn’t afford new cars to use new cars by means of lease agreements. GMI achieved an advantage in that it was able to avoid loss worth 40 million dollars that it would have grappled with had it stuck to only the sale of brand new cars (Gallardo, 2015).
Accordingly, the Kenyan and East African automobile market has grown in complexity and volatility over time. This has led to the big car dealers in Kenya to turn to leasing to avoid losing out on these huge deals especially from the government. Vehicle leasing is fast gaining currency in Kenya because investors are spared the headache of raising upfront capital to acquire a fleet. The servicing costs are also borne by the supplier and it may allow easier upgrades to a newer model (Herbling, 2017). This is a good example of a contingency factor in change management where dealers like Isuzu East Africa which traditionally were reluctant to lease their vehicles have now opened up and are ready to trade in this segment to gain more profits.
2.2.2 Systems Theory
The Systems Theory was advanced by Bertalanfy et el (1950) after effects of the second world war. Well versed with the advances in science that had started to question classical assumptions in the organizational sciences, he was triggered to start studying the systems approach. His works however started earlier than this when he presented a paper for a conference at the University of Chicago in 1937 on the General Theory of Systems. He viewed phenomena as a web of relationships among elements in a system, and that all systems have common patterns, behaviors, and properties that can be understood and used to develop greater insight into the behavior of complex phenomena and move towards a unity of science.
The theory views an organization as an organic and open system, comprising interacting and independent parts called subsystems. It is based on the assumption that everything is inter-related and inter-dependent, which on interaction form a unitary whole, and that its most important characteristic is the hierarchy of sub-systems. Chester Bernard applied systems theory in his works in the early 20th century. In his book, he emphasized competence, moral integrity, rational stewardship, professionalism and a systems approach for organizational success. He emphasized the role of the manager as a professional and the main steward of the organization, which he regarded as a system. His works saw him drive huge success at AT ; T, where he was a senior executive, enabling the company to win public acceptance of its telecommunications monopoly (Gabor and Mahoney, 2013).
The systems approach assists in studying the functions of complex organizations and has been utilized as the base for the new kinds of organizations like project management organizations. It is possible to bring out the inter-relations in various functions like planning, organizing, directing and controlling. This approach has an edge over the other approaches because it is very close to reality. Today’s manager must thus be keen when applying the systems theory as it can help him fully understand his organization and thus effectively drive organizational change. It can also come in handy when the manager plans to restructure the organization to be in synch with the new strategy that it has established, since structure always follows strategy (Rodrigues, 2014).
2.2.3 The Expectancy Theory (The Expectancy Theory of Motivation)
The Expectancy theory of Motivation was advanced by Victor Vroom (1965) to try and explain the relationship between individual behaviour vis a vis the expected outcome of a given activity. The theory argues that an individual will behave in a given way because he is motivated to do so based on the expected outcome of that behaviour over other behaviors. The desirability of the outcome to the individual in question has a direct and great influence on the type of behavior he will select. The theory is about the cognitive process of how different individuals process different motivational elements before choosing a behavior that is in line with the expected outcome. It basically attempts at explaining the process or processes that a person goes through to make choices.
In a similar fashion, employees’ choice of whether to adopt a proposed change strategy would be pegged on what they perceive as the expected outcomes of the decision they would make. Management is thus at an advantage if they would package a change strategy in a way that an employee would picture himself benefiting directly as this would ensure the employee buys the idea because they know what is in it for them. Awareness of the benefits that would accrue from making a certain decision is a big motivator towards employee decision making (Orkand, 2014).
2.2.4 Theory X and Theory Y
In his book “The Human Side of Enterprise”, Douglas McGregor (1966), advances theories X and Y. Theory X is founded on the premises that employees don’t like their work, avoid responsibility and require sustained direction, have to be threatened, controlled and coerced to produce results, need to be micro-managed at every step of work delivery, and that employees have no motivation or ambition towards work and thus must be enticed by reward systems to produce the desired results. The theory X leader will thus tend to overwork himself trying to manage his employees at every step of the work since he believes the employees are little concerned about the outcomes of their work. There is also reduced Delegation of Authority and increased Micro-management in such a scenario. According to him, organizations employing theory X approach have several tiers of managers and supervisors to direct and oversee workers. Control of main systems and decision making remain firmly centralized.
On the other hand, theory Y managers have a very positive perspective about their employees and thus tend to use decentralized and participative styles of leadership. The managers assume that their subordinates are initiative and enjoy their work, are self-driven and motivated, take ownership of their decisions and seek and accept responsibility, require little direction, approach challenges creatively and imaginatively and take work as challenging and fulfilling. There is thus increased delegation of authority and employed are availed with numerous opportunities for promotion and open communication. Any organization that needs to succeed in advancing change must thus seek to view its employees as McGregor views them in theory Y and thus give them opportunities to make their own decisions and to be accountable of their actions.
2.3 Conceptual Framework
Mugenda, (2008) defines conceptual framework as a concise description of the phenomenon under study accompanied by a graphical or visual depiction of the major variables of the study. Kombo and Tromp, (2009) defines it as a set of broad ideas and principles taken from relevant fields of inquiry and used to structure a subsequent presentation. It is a research tool intended to assist a researcher to develop awareness and understanding of the situation under scrutiny and to communicate this. Bell, (2010) describes it as a diagrammatical representation that shows the relationship between dependent and independent variables. A conceptual framework assists a researcher to organize their thinking and complete an investigation successfully. It also explains the relationship among interlinked concepts and explains the possible connection between the variables (Kombo & Tromp, 2009).The following framework depicts the relationship between the independent and dependent variables based on four independent variables and a dependent variable as represented diagrammatically in Figure 2.1. In this study, performance of motor industry is dependent on strategic leadership, strategic resources allocation, strategic organizational culture and strategic technological changes.
Figure 2.1: Conceptual Framework
2.3.1. Strategic Leadership
Leadership is a process of influencing others and agreeing about what needs to be done and how it can be done effectively and the process of facilitating individuals and the collective efforts to accomplish the shared objectives.( Yang , Zhao, and Baron 2007). According to Hellriegel and Slocum (1974), management of Change also needs compassionate leaders and staff to embrace it. Bearing in mind that change is inevitable, organisations and the management in particular need to come up with a change management plan to help lead the employees on the path of making that leap to permanent change together. 15 Leadership assumes three main dimensions which are task oriented leadership, relationship oriented leadership and change oriented leadership. Task oriented leadership is primarily concerned with accomplishing the task, utilizing the personnel and resources efficiently and maintaining orderly reliable operations. (Hay and Hodginkinson 2006).
Change oriented leadership is concerned with improving strategic decisions, adapting to change in the environment, increasing flexibility and innovation, making major changes in processes, products or services and gaining commitment to change. According to Senge et al (2009) change driven by authority is more efficient to organize, often effective in the short run, and more immediately comfortable for people in many organizations. If all goes well, great results may occur but the change effort is powerful only so long as it is pushed. When the leader moves on or loses interest or energy.
Leadership here is based on authority, position and seniority. Organizations that invest in leadership development perform better than those that don’t. In these changing times it is hard to find a firm which has survived that has no leadership development strategy in place. It is important for the management team to be able to handle difficult questions about people and their development. Leadership is not just about the leaders themselves but also about creating a culture of performance. Great leaders attract, hire and inspire great people if an organization neglects its leadership part it can easily loose direction and fail to achieve the set goals and objectives of change implementation process (Ponder 2001). Change management demands strong leadership to rapidly push through stressful, discomforting and risky shifts in the business and organisational system. Battling the sources of rigidity and turning crisis into opportunity are the key qualities needed by managers implementing and managing change in an organisation. Ultimately managers should know when to change and when it is wiser to seek stability, they should also know when to trigger a change and when to avoid one (De Wit and Meyer 2010).
2.3.2. Strategic Resources Allocation
A resource can be referred to as an organizations means of supporting itself or becoming wealthier, as represented by its tangible and non-tangible assets. It is a source or supply from which benefit is produced (Ainuddin 2007). Counties in Kenya operate with very limited resources. This has led to weak operational preparedness, and a lack of equipment and logistical capacity. For example, the police do not have a forensic laboratory, vehicle patrols are constrained by a lack of availability of vehicles and funds for fuel. Police salaries are low and police officers complain about bad housing and poor working conditions. Police find themselves dealing with dangerous, sometimes life-threatening, situations without adequate insurance to provide for their families when things do go wrong. Lack of adequate resources has also been attributed to the stalling of the ongoing reforms initiative (AI 2013).
According to Denrell (2004), in his study resources and returns, he explores the usefulness of analyzing firms from the resource side rather than from the product side. He concluded that resources such as brand names, technology, skilled personnel, trade contacts, machinery, capital and efficient procedures are the foundation for attaining and sustaining strong change initiative and high performance of a firm. A firm’s resource include all assets, capabilities, organizational processes, firms attributes, information, and knowledge controlled by a firm that enable a firm to conceive and implement strategies that improve its efficiency and effectiveness. Good resource should have value, be rare, not easily imitated, and not easily substitutable. Poorly resource endowed organizations usually face a lot of hurdles when it start any change initiative. For easy and successful change management process the security organization must set aside a considerable amount of its resources to support it. Failure to invest enough in the process the change initiative is bound to fail miserably (Sugarman 2010).
2.3.4. Organizational Culture
According to Patterson, Warr and West (2004) Organizational culture can be defined as a pattern of behavior developed by an organization as it learns to cope with its problem of external adaptation and internal integration that has worked well enough to be considered valid and to be taught to new members as the correct way to perceive, think, and feel. Organizational culture can also be referred to as the world view and behavioral patterns shared by the members of the same organisation. As people within an organisation interact and share experiences with one another over an extended period of time they construct a joint understanding of the world around them. This shared belief system will be emotionally charged as it encompasses the values and norms of the organisational members and offers them an imperative filter with which to make sense of the constant stream of uncertain and ambiguous events around them. As this common ideology becomes stronger and becomes more engrained, it will channel members’ actions into more narrowly defined patterns of behaviour. As such organisational culture can strongly influence everything from how to behave during meetings to what is viewed as ethical behaviour.
Organisational culture manifested in a variety of human resource practices, is an important predictor of organizational change management success. Numerous studies have found positive relationship between positive organisational culture and various measures of organisational success in change implementation, most notably for metrics such as sales turnover, staff retention, productivity, customer satisfaction and profitability. Like all other organisations the Kenya police service has its culture in that all members of the institution are familiar with and accept as part of their way of doing things in within the service. It is believed that the police still cling to one of the most outdated and rigid culture that may hinder any meaningful change management process. The managers here should understand and plan carefully the staffs’ attitudes towards a particular new concept before implementing it.
Potosky and Ramakrishna (2001) argue that organisational culture clearly influences the success of an organization change management process. Organizations often build positive organizational culture through communication, values, norms policies and rules, programmes and leadership. Key indicators of organisational culture to be studied here include organisational attitudes, values and beliefs, history and norms and symbols and rituals. Nadler and Tushman (1980) said Organizational culture significantly affects organisation decisions and, thus, must be evaluated during an internal strategic-management audit. If strategies can capitalize on cultural strengths, such as a strong work ethic or highly ethical beliefs, then management often can implement changes swiftly and easily. However, if the firm’s climate is not supportive, strategic changes may be ineffective or even counterproductive. An organisations culture can become antagonistic to new strategies, with the result being confusion and disorientation. An organization’s culture should infuse individuals with enthusiasm for implementing and managing change.
Mechanistic type of organisations defends against change but they are less open to it. They are however unlikely to support, without serious trauma, the transformational or revolutionary types of change. Structural characteristics as well as attitudes, beliefs and values are more likely to act as barriers to an effective change management programme. Assessing cultural risk helps management pinpoint where resistance to change could occur because of incompatibility between strategy and culture this allows managers to make choices regarding whether to ignore the culture, manage around the culture, change the culture to fit the strategy or change the strategy to fit the culture (Senior & Swailes 2010).
2.4 Empirical Review
Dent (2013) while studying the change process in a hospital which contained networks of professionals groups, managers and administrators found out that politics, persuasion and attitudes played a key role in exploration of the changing professional management relations. According to Amnesty international (2013), the pace of reforms in the Kenya police service has been hampered by corruption, failure to adhere to the new constitution, structural challenges lack of compliance with the law, lack of vetting, ongoing police impunity, lack of resources, public confidence.
Fullan and Miles (2012) while studying the reform process in the education sector in Toronto discovered that faulty maps of change, complex problems, symbols over change, impatient and superficial solutions, misunderstanding resistance, misuse of knowledge about change management process among other factors are the main reasons why change management process is usually faced with challenges.
Gao (2005) applied ANT to analyse change in china’s telecommunication market. The market was identified as a non- human actor and the 12 public, the state and the operators made up three groups of human actors he identified leadership and communication as the main ingredient to a successful change management process in an organisation. Van de Duim and Marwijk (2006), in explaining change management and innovation in the sense that innovation means new patterns of coordination between people and organisations, technologies and environmental phenomena. They explained that change management involves the idea of translation which involves explaining things in ways that persuade actors to fit with farmers to adopt a particular land management practices that will raise breeding populations species. They identified size and complexity of project, budget, specialized knowledge needed as the main constraints to effective change management process.
Meyer and Herscovitch (2011) conducted three studies to test the application of a three component model of workplace commitment in the context of employee commitment to organizational change management. Study 1, conducted with 224 university students, provided preliminary evidence for the validity of newly developed Affective, Continuance, and Normative Commitment to Change Scales. Studies 2 and 3, conducted with hospital nurses, provided further support for the validity of the three commitment to change scales, and demonstrated that, commitment to a change management is a better predictor of behavioral support for a change process than is organizational commitment, affective and normative commitment to a change are associated with higher levels of support than is continuance commitment, and the components of commitment combine to predict behavior. They identified employability, trust in management, change communication and decision making process in an organisation as the main factors that affect organisational change management process.
A study by Sugarman (2010) The New York police department in the early 2000,s faced a lot of challenges in conduction of its operations especially in the wake of terrorism and other forms of sophisticated crimes witnessed in the modern world. This forced the management to embark on wide range reform initiatives aimed at totally changing the way the department fought crime and administrative duties. In the reform process the department faced numerous changes emanating from resources, lack of leadership, and political influence from the outside environment among other challenges. Sugarman also stated that with improved change management strategies the department was able bring sanity in the running of the department to a reputable police department both in the USA and the world at large. According to Luthans (2008), the change management is always considered to have three major dimensions which are technical, conceptual and human. Overall it has been proven that today’s managers are very competent in their conceptual and technical functions however they are still struggling with the human component due to the nature of the humankind which keeps on transforming itself constantly.
This chapter specifies the nature of the research design and the population studied. The research design, target population, sampling techniques, data collection techniques and data analysis methods that will be followed in the research process.
3.2 Research Design
A research design describes how the study addresses the specific aims and objectives of the research. This study will be a descriptive survey designed to establish the influence of strategic change management practices on performance of motor industry in Kenya. Descriptive research studies are designed to obtain pertinent and precise information concerning the current status of phenomena and whenever possible to draw valid general conclusion from the facts discovered. Descriptive survey attempts to describe characteristics of subjects or phenomena, opinions, attitudes, preferences and perceptions of persons of interest to the researcher. Moreover, a descriptive survey aims at obtaining information from a representative selection of the population and from that sample the researcher is able to present the findings as being representative of the population as a whole (Bryman & Bell, 2012).
3.3 Target Population
Orodho (2009) describes population as the entire group of individuals or items under consideration in any field of inquiry and have a common attribute. The target population of the study will be 80 top, middle and lower level management staff drawn from the departments of Manufactruidng, Finance and Strtagey, Human Resources and Administration, Sales and Marketing, and Aftersales & Channel Development (Isuzu EA HR, 2018).
Table 3.1: Target Population
Category Population Percentage
Top Management Level 10 12.5
Middle Management level 15 18.75
Lower management Level 55 68.75
Total 80 100
Source; (Isuzu East Africa, 2017)
3.4 Sample and Sampling Technique
The study will adopt census and according to Abbott and McKinney (2013) a census yields more reliable results than a sample, and whenever it is possible it should be undertaken. Since major procurement related matters are carried out by the targeted population, they are seen as most appropriate to give out the required information for the purpose of this study and therefore they were targeted as respondents for the study. The census approach is justified since according to Orodho (2009), data gathered using census contributes towards gathering of unbiased data representing all individuals’ opinions on a study problem (Field, 2006). Census provides a true measure of the population since there is no sampling error and more detailed information about the study problem within the population is likely to be gathered (Saunders, 2011).
3.5 Research Instruments
The study will rely mainly on primary data. The researcher will use questionnaire as the research instrument. The study will utilize questionnaire that will be developed for generating information on key variables of interest from the targeted respondents in the study. The research also will undertake a desk review of existing information about the study areas and collect qualitative data through in-depth interview from respondents who are conversant with the subject through various interactions or experiences. These respondents will be specifically targeted for their ability to provide pertinent information to the study.
Secondary data will be obtained from literature sources or data collected by other people for some other purposes. Secondary data was collected through review of published literature such as journals articles, published theses and textbooks. The study will make use of secondary data from treasury records. These sources will be reviewed to give insight in the search for primary information. They will give insight on variables selection, development of instruments and discussion of the findings.
3.6. Data Collection Procedure
The researcher will contact the management with an introduction letter requesting for permission to collect data and to drop questionnaires. The individual employees will be explained by the researcher on the intention and purpose of the study. The researcher will recruit and train two research assistants in an effort to ensure that they carry out the exercise properly. The questionnaires will then be delivered by the researcher with the help of the two research assistants to the respondents. The respondents will fill the questionnaires within a period of two weeks after which the questionnaires will be collected.
3.6 Pilot Study
According to Bordens ;Abbott (2008), pilot study is as a small-scale version of the study used to establish procedures, materials and parameters to be used in the full study. Pilot study will be conducted in determining if there are flaws, limitations, or other weaknesses within the data collection instrument to make the necessary revisions prior to the implementation of the study. It is recommended that 10% of the population should constitute the pilot test (Neumann, 2006). A pilot study will be undertaken on at least 11 respondents of the population to test the reliability and validity of the questionnaire. The findings of the pilot study will not be included in the actual study (Mugenda ; Mugenda, 2012.
3.6.1 Reliability and validity of the research instruments
Reliability is the extents to which a research instrument yields findings that are consistent each time it is administered to same subjects (Yin, 2017).The measurement of reliability provides consistency in the measurement variables(Kumar,2010)). Cronbach alpha is the basic formula for determining the reliability based on internal consistency (Kim ; Cha, 2012). The standard minimum value of alpha of 0.7 is recommended Gupta (2004) as the minimum level for item loadings. Higher alpha coefficient values means there is consistency among the items in measuring the concept of interest. Suppose that we assume a sum of K components (K-items or test lets) X=Y1+Y2+……Yk. Cronbach’s ?
where the variance of the observed total test scores, and the variance of component i for the current sample of persons.
If the items are scored 0 and 1, a shortcut formula is
where is the proportion scoring 1 on item i, and . This is the same as KR-20.
Alternatively, Cronbach’s can be defined as
Where is as above, the average variance of each component (item), and the average of all covariance’s between the components across the current sample of persons (that is, without including the variances of each component).
Validity is the degree to which the sample of the test item represent the content that is designed to measure, that is, the instrument measures the characteristics or trait that is intended to measure (Mugenda & Mugenda, 2008). Data need not only to be reliable but also true and accurate. If a measurement is valid, it is also reliable (Creswell, 2003). The research adopted content validity which refers to the extent to which a measuring instrument provides adequate coverage of the topic under study. The content validity was achieved by subjecting the data collection instruments to an evaluation group of experts who provided their comments and relevance of each item of the instruments and the experts indicate whether the item is relevant or not.. The content validity formula by Yin (2003) was used in this study. The formula is; Content Validity Index = (No. of judges declaring item valid) / (Total no. of items). It is recommended that instruments used in research should have CVI of about 0.78 or higher and three or more experts could be considered evidence of good content validity (Yin, 2003).
3.7 Data Analysis and Presentations
Data collected will be analyzed using both quantitative and qualitative methods with the help of Microsoft Excel and Presented using Statistical Package for Social Scientists (SPSS) version 22. Data processing will be carried out through editing, coding and classification. Content analysis will be employed to analyze the qualitative data whereas simple statistical methods, regression and correlation analysis will be utilized to analyze the quantitative data by aid of SPSS Software version 22 and excel. The findings will be presented using tables, charts and graphs to facilitate comparison and for easy inference. The regression analysis will be applied to establish the relationship of the variables at 5% level of significance. The regression model equation will be expressed as follows:
Y = ?0+ ?1X1+ ?2X2+ ?3X3+ ?4X4 + ?,
Where; Y= Performance of motor industry
?0= constant (coefficient of intercept);
X1= Strategic leadership;
X2= Strategic Resources Allocation;
X3= Strategic organization culture
X4= Strategic technological changes;
? = Error term;
?1…?4= regression coefficient of four variables.
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