23 pages Leadership and Change Management

Leadership and Change Management

Consider a change that has been recently introduced in your organization. Using relevant change and leadership theories, critically analyze the benefits and problems that introduction of this change has brought. TO WHAT EXTENT HAS LEADERSHIP CONTRIBUTED TO THE RESULTS OF THIS PROCESS?

RasgGas is a joint venture gas company between Qatar Petroleum, the State of Qatar’s national oil and gas company (majority stakeholder), and ExxonMobil, an American Integrated Oil and Gas company. The company is about fifteen years old and has been involved in all aspect of exploration, development, production, liquefaction and marketing of gas from the North Field. RasGas is a major contributor to the State of Qatar’s worldwide leadership in the production and marketing of Liquefied Natural Gas (LNG) export. The company has utilized technologies to drill high capacity gas well and build the largest and most efficient liquefaction trains in the world. These technologies and large scale facilities enable RasGas and the State of Qatar to economically produce and export LNG to all parts of the world, a reach that was beyond economic possibility just few years ago.

To accomplish this objective, the company has put into place a geographically extensive “assembly line” that connects to, collects, processes, stores and ships a natural resource (gas), from its original location deep below the surface, to a transportation network that delivers the product to its eventual consumers. Its activities related to the extraction of the gas from the reservoir by way of wells, and transportation to shore by flow lines is considered the “subsurface” part of the business. The processing of the gas occurs onshore, and is considered the “surface” part of the business.

For most of the first fifteen years of the company’s existence, the focus has been on the creation (“development”) of the assembly line: the drilling of wells, designing, building and installation of platforms, pipelines, the gas plants and the storage and shipment terminals. This development work was completed in early 2010, with the commissioning of the last gas plant train, Train Seven. This train design is the largest gas plant design in the world. As an indication of the scope of this work, in 2009, the work involved in the development process consumed in excess of 100 million man-hours.

As the development progressed, wells and gas plants were put into service, and a revenue stream was established. The nature of the gas plant designs was such that the production contribution from each succeeding project was skewed to the later phases of the development process, in effect, smaller gas plants were put online first, followed by significantly larger ones towards the end of the development phase. Almost half of the production capacity and wells came online in the past two-year.

In the first half of the 20th Century, economics were based of Fordism and mass production industries, rather than high technology and information processing. In the 21st Century, more organizations are going to be integrative, human-timed rather than machine-timed, more horizontal than vertical or hierarchical, and based on teams and virtual enterprises. Managers will have to deal with new, complex systems in which change is the norm, with a style of frankness, directness, learning from mistakes, trust and respect. Adaptive organizations must be proactive, with stakeholder and customer participation, less hierarchical, having shared leadership and a common vision. Their communication style will be open, with impartial and objective decision-making and a collaborative workplace (Garrity p. 270). Adaptive leaders will be less authoritarian, and value listening, collaboration, education and vision (Garrity p. 273).

Defining the Change

The change described in this paper relates to the organizational changes put into place to facilitate and to improve the company’s transition from one focused on the development of its production system, to one that will be focused on the actual, continual campaign of production, and of production sustainability. The production system can be compared to an assembly line, and like many real-world assembly lines, it shares some similar characteristics:

The raw material quality may change with time, and the quality control/quality assurance systems must be able to accommodate these changes.

The equipment is all aging and requires an increasing amount of maintenance.

The end-user’s demand for product is changing, and the production system must be able to respond to these changes in demand.

These characteristics are different from the basic characteristics present during the development phase in which activities can be categorized as:

Well defined, with minimal changes that are well managed at all times. The incoming products needed for the construction are known and of fixed properties, by way of contractual terms.

The design and build are all “green-field,” in effect, all new equipment with initial warranties provide by the suppliers.

The scope of work is fixed or as a minimum controlled through a project management of change process.

Easily compartmentalized along functional lines; the structural engineers for one process step could proceed with their design with minimal interaction with other processes, other than clear communication on the boundary conditions (for example, the output from the recovery unit could be adequately describe through it’s flow rate, at a certain temperature, with a particular composition). These differences require the operating organization to be one that is more flexible, resilient, and most importantly, integrated across functional lines. The impact of events that occur in one area of the assembly line, such as the well, have a knock-on effect downstream, which requires all of the different technical functions to be working together on a common issue rather than relying on fixed boundary conditions.

The organizational change undertaken to support this change in focus was to adapt a matrix management organization around individual production blocks as “assets.” The “Asset Surveillance Team” for each block would consist of all the functional disciplines necessary to address the required subsurface issues. As with most matrix organizations, the individuals would still report within their functional organization. One difference in this implementation from classic matrix organizations was the intentional elimination of an Asset Manager. Instead, rotating “focal points” were defined. It was believed that this would eliminate any confusion within the teams regarding their responsibilities, and also would foster an increased level of ownership by each of the team members.

The main objective of the Asset Surveillance Team was to promote inter-disciplinary communication, and a deliberate attempt was made to eliminate a hierarchical structure that could work against team collaboration; especially in light of the fact that whoever would be designated the Team Manager would most likely come from one of the disciplines. The Asset Team Changes were: Narrow, Strategic, Proactive, Planned, Emergent and Top-down. Eisenbach at al (1996) describe transformational change as requiring the creation of “a new system and then institutionalizing the new approaches” (p. 80). New models of visionary, charismatic and transformational leadership “are likely to become even more important to organizations because of the breathtaking changes in the business and political environment” although there is still little integration between research in change management and leadership styles. Most change is transactional and incremental, but sometimes in the life of organizations and societies there are interruptions by “brief periods of discontinuous, radical change” (Eisenbach et al., p. 80).

Event-pacing may be most suitable to small, incremental changes since it is focused on narrow, specific outcomes but time-pacing works better in periods of radical change. In these periods, successful managers “provide clear responsibility and priorities with extensive communications and freedom to improvise,” like jazz improvisation (Eisenbach et al., p. 82). They connect present projects with the future with time-spaced intervals and regular pauses so the organization can assimilate changes. While transactional leaders manage through providing rewards for performance, transformational leaders are inspirational, charismatic and visionary. They are most appropriate to organizations facing radically new situations or undergoing a crisis, and know how to create positive appealing visions of the future and are able to set challenging and stimulating goals for their followers. They also know how to control and pace change so their followers are not overwhelmed and the entire process falls apart and how to reward behaviors “that are directed toward fulfillment of the vision” (Eisenbach et al. p. 84). Drew and Coulson-Thomas (1996) asserted that the majority of executives “believe their organizations to be faced with revolutionary change, and that the pace of change is increasing” due to technology and globalization (p. 7).

All change advocates support the concept of cross-functional teams and collaborative work ventures to: improve communication; increase the speed of action and level of commitment; and improve flexibility and adaptability. Even so, the type of teams that work in Japan may not function in more individualistic Western cultures and “the benefits are all-too-often exaggerated and the difficulties underestimated” (Drew and Coulson-Thomas, p. 7). Loose networks and a supportive organizational culture may be just as effective as teams. Some organizations such as hospitals and airlines have more extensive experience with teams than others, and they are most suitable to routine and ongoing activities with distinct objectives, such as logistics, order processing and purchasing. They often fail through lack of senior management support and commitment, lack of vision and clear goals, poor training and inadequate rewards (Drew and Coulson-Thomas, p. 8).

A survey of 75 organizations in the UK ranging in size from 500 to 10,000 employees found that teams were most useful in “customer satisfaction, achieving total quality and overcoming departmental barriers,” but less important in building relationships with customers or improving organizational learning (p. 9). Nor were they used during downsizing which si unpopular and usually carried out in secret by top management due to union opposition and bad publicity. Teams will generally not approve of downsizing that will result in job losses for colleagues, and in any case “many downsizings subsequently are regarded as failures” (Drew and Coulson-Thomas, p. 11).

After the company has completed the development phase of the field and more wells came on production, the small team that has been stewarding the surveillance of the initial small number of producing wells needed to be expanded into multiple and matrix teams. Each team was made of multi-disciplinary members and focused on a different segment of the field. The small initial team consisted of members with one engineering discipline and reported to one supervisor. The change would have entailed the inclusion of new members reporting to different supervisors with different technical background needed to look at the performance of the wells and the blocks for which they are responsible in an integrated way.

This change was necessary to cover all aspect of surveillance of the field using all the necessary resources to be thorough. However, the basic structure of the company did need not change. The model used for the surveillance phase was inline with the structure and approach used during the Development phase – use of matrix, multi-disciplinary team under different functional leadership. However, a key concern was to avoid team members tending to work in discipline-related silos and not talk to each other. Such situations would defeat the principle purpose of having integration wait of executing field surveillance and data analyses. Some of the characteristics of this change, looked at from a leadership perspective, are addressed in the next sections.

There are some important aspects of the change that relate to employees currently in the subsurface group, within the company, and incoming employees. The transition from a development to a production company involves three types of changes in personnel, two of which are associated with the current staff in place:

Those personnel directly involved with the development, whose skills are no longer needed, will be released to work on other similar projects elsewhere.

Those personnel whose work is associated with production surveillance and sustainment activity, or whose work is related enough to be re-used in the surveillance role, will be considered as candidates for re-tasking rather than release.

The increased activity to support production maintenance activities will require additional people of specific skills to be brought into the company. Those personnel who may also possess these skills, but were going to be released for other projects, will be considered for these roles as well.

These changes need to be managed along with the organizational reporting changes in order to minimize the Asset Surveillance Team’s distractions from their work assignments.

The scope of this change was extremely limited, and the total number of employees affected by the change was less than sixty. This is approximately two percent of the entire organization. As such, the change can be considered a narrow change. The change was a deliberate effort to redirect the focus of the subsurface organization, to address required needs very different from the current needs. As such, this change is a strategic change. While the company is coming to an end of the development phase, the facilities are still fairly new, with minimal operating problems presenting themselves at this time. The company could have easily deferred making any organizational changes until events presented themselves. Undertaking this change at the time that it did was very much a proactive approach to deal with the future perceived needs.

The Change Process

The subsurface management embarked on this change based on a thoughtful consideration of future needs. This was done in advance of actual problems and issues presenting themselves. This reflects the planned nature of the change process. The change was put into place in a discontinuous manner; the Asset Surveillance Teams were initially conceived and then put into place in a very short period of time. From the perspective of the functional teams in place, the change was a radical change. However, the limited scope of the change meant that the overall impact to the company as a whole was negligible. The change was envisioned and put into place by middle management, with concurrence from upper management. The need for the change was not conceived of by the employees. From the employee’s perspective, this appears to be a Top-Down approach. From the perspective of the entire organization, it may be considered a bottom-up solution, having originated at a level close to the first line supervisor’s level.

One example of top-down change was Operation Centurian at Philips Electronics in 1990, which resulted in 45,000 layoffs. This change process was made easier by the fact that the company was facing bankruptcy to due intense completion from the Japanese in the 1980s. In his famous book In Search of Excellence, Tom Peters suggested that executives needed to adopt a new management style based on the Japanese model which had a great deal of influence on managers at Philips. Wisse Dekker, the CEO at Philips in 1982-86 had studied management in Japan for six years, but when he attempted to introduce a Company Work Quality Improvement (CWQI) system at Philips, the change failed (Karsten et al., 2009, p. 73). Only in 1990 did Philips resort to ‘shock treatment’ under a transformative leader named Jan Timmer, who did not hesitate to use “language full of challenging organizational values and visions” and also exuded trust and confidence in the future (Karsten et al., p. 76). Philips simply did not know how to survive in the new globalized economy of the 1970s and 1980s since its origins were in a very different world that had been mercantilist and ruled by a few colonial powers. Timmer’s layoffs shocked European politicians and labor leaders, who called him “the Butcher” and “the Hangman” for adopting American-style downsizing methods (Karsten et al., p. 81). Even in 1990, most of the managers at Philips did not realize that the company was near bankruptcy until Timmer called a secret meeting one weekend and informed them that the end was near. Even though managers described this event as a “funeral” and “the Valley of Death,” Timmer forced them to sign written agreements promising to lay off 15% of the workforce (Karsten et al., p. 83). In the new training program, “naming, blaming and humiliation became a common practice, which was also shocking to managers in a staid, conservative European company (Karsten et al., p. 84), and not at all in keeping with its tradition culture and traditions. Timmer also set up twenty-one corporate tax forces to improve quality at every level, along with a new education and training program and a series of town meetings to improve communication with employees and obtain input from them.

There are forces that work against the adaptation of the change, such as resistors, employees and other stakeholders, the close knit original team and their supervisor who may feel loss of power and visibility, new members who may be confronted with fear of unknown tasks, goals, and performance expectations. Lack of clarity in terms of responsibilities can lead to resistance, since teams were venturing into new technical and work frontier, with no roadmap and little outside guidance and know-how. Competing responsibilities for team members included demands related to their functional-home leadership/goals and new surveillance objectives — misalignment from the matrix and functional objectives. There was unclear authority from accountability perspective, since there were no organizational change and team members continued to report to their original functional supervisor who was not directly responsible for the new teams. Outside stakeholders were concerned about their roles of the new organization, and how they will interact with the stakeholders, can lead to resistance from the stakeholders.

Although all models offer similar methods for dealing with change, there is “substantial variability in how the phenomena associated with resistance are received and ultimately operationalized” (Brisson-Banks, 2010, p. 41). Resistance to change can be very complex but it has positive and negative aspects and actually can bring about improvements in an organization undergoing change. Resistance has no common definition, no more than trust, communication or participation. It can be active or passive, overt or covert, in thought or behavior, and individuals can be ambivalent about change in all of these dimensions at the same time. Most resistance is passive and covert, intended to slow down change rather than openly oppose and obstruct it. Emotions associated with resistance to change include anxiety, fear, stress and anger, and certain personalities, particularly those of a rigid and dogmatic type, and have less openness to change and tolerance for risk and ambiguity than others. Individuals with “maladaptive defense mechanism” like projection, denial nd acting out are also more likely to oppose change of any kind (Brisson-Banks, p. 44). Resistance is often based of fear of job loss or a decline in status, or fear of inability to adapt to change. In general, better information about change is correlated with more positive attitudes towards it, unless management is contradictory in its professed attitudes and actual behavior. Participation leads to “more positive views of the change, reduced resistance, and improved goal achievement,” including in the internal development of change plans (Brisson-Banks, p. 47). Distrust of management always leads to resistance to change, and also greater levels of anger, frustration and anxiety. Only about 7% of employees interviewed in one survey regarded management as “collaborative” or capable of involving individuals in decisions, and these had the most positive view of change in their organizations (Brisson-Banks, p. 48). For the overwhelming majority of employees who regarded management as coercive or rational-empirical, their attitudes towards change were far less sanguine.

Materials Requirements Planning (MRP) got its start in the 1970s, heavily influenced by the Just-in-Time system used in Japanese manufacturing. Yet few organizations have been able to use the new technology well and MRPII has been called a ‘$100 billion failure’. There has been a very high failure rate in implementation of the new system, led by managers who could not carry out the change. They were almost never transformational leaders who could instill “a sense of purpose in those who are led” or encourage “emotional identity with the organization” (Brown, 1994, p. 6). MRPII can make companies more competitive and improve customer service, leading to higher efficiency, lower costs and fewer shortages, but at least 50-70% of MRP systems fail. Most organizations are simply not prepared to make the change, and often face massive resistance on the part of employees concerned with job losses, lower pay and loss of security and status (Brown, p. 7). Erwin and Garman (2010) surveyed 1,536 executives and found that only 38% regarded change initiatives as successful, while just 30% thought that these had “contributed to sustained improvements of their organizations” (p. 39). Resistance to change was the main reason for these failures, much of which occurred under the surface, and can take cognitive, affective and behavioral forms. Management that encourages confidence, trust and participation can also harness resistance to change in order to improve its prospects.

Supply chain collaboration improves productivity, profits and customer service, but companies often have difficulty putting this new system into practice. Low trust in management is a major reason for this, and “more often than not, the resisting forces have proven stronger than the driving forces” (Fawcett et al., 2010, p. 270). Globalization, technology and increased competition have all combined to put great pressure on companies, and in the cost of goods sold 50-80% are due to materials and service providers, but collaboration is “rare, valuable, and hard to replicate” (Fawcett et al., p. 272). Force-field theory indicates that resistance can get out of control without the support of top management, and that frozen companies become irrelevant in the global economy. Technology alone cannot overcome employee resistance since “the organizational structure and culture are among the most intractable barriers to more effective collaboration within the firm and across the supply chain” (Fawcett et al., p. 273).

Specialized companies with many areas of in-depth knowledge experts tend to become highly fossilized and opposed to change, and social dilemma theory points out that in an environment of insecurity, employees fear the competition for scarce resources and that their loss will be other’s gain. In this situation, removing the barriers that lead to distrust of collaboration is very difficult. Culture, human personality and structure all combine to resist change, and “resisting forces permeate the culture, structure, and technology of the organization” (Fawcett et al., p. 283). On the other hand, logistics professionals are most open to supply chain collaboration, and value it more highly than financial and production managers. In addition, the use of teams, rotation, and better training and communication can also overcome resistance (Fawcett et al., p.286).

One of the main characteristics desired from the new organization was the ability to be flexible and resilient. This is facilitated through the ability to quickly change priorities, but can also be disconcerting to employees. The close knit original team and their supervisor who felt the loss of power and visibility, so the supervisor of the initial team was asked to take lead role in guiding the teams to reduce any feeling of threat to his status. The new members were confronted with fear of unknown tasks, goals, and performance expectations. An early brainstorming session by lead advisors were organized in order to provide a semblance of a guiding roadmap on how the new surveillance work scope looks and what roles and responsibilities each member will have. Teams were venturing into new technical and work frontier, with no roadmap and little outside guidance and know-how. Members of the original team members were asked to take lead role in the teams and help everyone learn from each other. There was unclear authority from accountability perspective, since there were no organizational change and team members continued to report to their original functional supervisor who was not directly responsible for the new teams. New reporting tools such as monthly team report that cover different discipline were implemented in order to promote collaboration and analyses integration (reducing silos mentality)

The roles of outside stakeholders in the new organization, and how they will interact with the stakeholders, can lead to resistance. Heads from different disciplines were asked to become coaches and mentors for the multi-functional teams in order to help prioritize tasks, equally share tasks, encourage team collaboration and help with accountability. One of the main characteristics desired from the new organization was the ability to be flexible and resilient. This is enabled through he ability to quickly change priorities, which can be disconcerting to employees. Upper management organized competitions with awards on areas that teams were not focusing on or working well together. This increased the prestige of teams and showed the level of upper management commitment to the surveillance team idea and its importance

Leadership Roles and Models

The nature of the change undertaken by RasGas shares many attributes of a transformational change, rather than a transactional change. The approach and features of two transformational models are considered below, and their fit to the change is discussed and compared. The Bass and Alovio model fits the change undertaken by RasGas with their adaptation of a matrix organization for Asset Surveillance Teams? In a survey of 198 employees of a multinational corporation (Michaelis et al. 2010), transformational leadership was “strongly related to implementation and commitment to change,” and one important recommendation was that organizations should learn to train transformational leaders at all levels (Michaelis et al. p. 408).

At least 50-60% of all changes in technology fail, although almost all research focuses on managers at the upper level and top-down models rather than middle and lower level managers. Nor has the relationship between innovation and transformational leadership been studied, although transformational leaders inspire intense commitment in their followers and create a climate supportive of change. Indeed, their main goal is to make followers “more receptive to organizational change” (Michaelis et al. p. 412). Studies suggest that “transformational leadership is positively related to followers’ innovative implementation behavior because it can increase commitment to change.” They make change seem like a positive experience with beneficial outcomes, and ensure that followers in a supportive environment will be more enthusiastic for change. A work climate more open to initiative also encourages followers to take charge and assume more responsibility, rather than simply feeling “helpless and victims to the innovation” (Michaelis et al. p. 414).

If the overall climate does not foster initiative, workers will be less supportive of change and innovation and less responsive to the inspiration of transformational leaders. A in study of middle and lower level managers in and R&D division of a German company that was installing a new computer system, there was considerable resistance to change and innovation. This company had a 70% failure rate in previous technical innovations since employees did not use the new technology and showed “no initiative to solve technical problems” (Michaelis et alp. 415). In this case, the main reason for failure was a top-down management style with no employee participation in charge or “perceived climate for initiative” (Michaelis et al., p. 421).

Garrity (2010) stated that adaptive leaders must be competent and trustworthy, open to dialogue and participation from the workforce, and are better able to manage change in a difficult environment. Quinn (1988) found that managers need to understand “dynamic, paradoxical, and complex forces” and must be able to deal with change and ambiguity. Most managers are closed to change, however, and trust their own methods, thoughts and strategies, even developing “moral positions that they use to resist any different thoughts, perspectives, or strategies” (Garrity, p. 267). For Quinn, there are four styles of management: rational, human relations, open systems and internal process. Rational and open systems models are focused on the short-term, but the former prefers certainty and the latter uncertainty. Rational style managers regard all decisions as final, while the open style will always change with new information. Both human relations and internal process models focus on the long-term, with the internal process manager valuing certainty, predictability and security, while human relations deals better with conditions of uncertainty. Internal process prefers the status quo, while human relations values consensus and tolerance (Garrity p. 268).

For Lewin (1942, 1947) an important aspect of change was “unfreezing” or getting the members of the organization “to let go, both physically and psychologically, of the current ways of doing things within and organization.” Kotter and Schlesinger listed six important factors in facilitating change, such as education, communication, participation, facilitation and coercion (Self and Schraeder 2009, p. 171). Lewin’s model was a three-phase process of change that involved unfreezing, change and refreezing, with mangers who “guide employees through these three change states” (Brown, 1994, p. 7). Unfreezing involves rites of questioning and destruction that “formally challenge the established order of the organization” and the open criticism of its failures. Legitimization of change requires that commitment spread throughout the entire organization, not simply from the top-down or elite groups. Management often has to “replace staff who are unable and unwilling to acknowledge the need for change,” but at the same time carefully balance against “conservative vested interests” (Brown, p. 9). Refreezing is an integration and consolidation phase, resolving conflicts and bringing an “end to the uncertainty and instability.” This is “useful and necessary after a period of sustained and far-reaching change” (Brown, p. 10).

Armenakis (1999) argued that “readiness for change is created in the message delivered by management to the employees” (Self and Schraeder, p. 171). They have to convince them that change is necessary, that the right changes are being made and that change will benefit all members in the long run. This process is much simpler if there is an immediate danger that threatens the survival of the organization and, by extension, to everyone’s job. Yet change must also fit within the organization’s culture, structure and history or it will fail. Frontline supervisors play a key role in this process by explaining change to the employees especially if they do not trust the management (Self and Schraeder, p. 173). Most individuals do not like change and the uncertainty and insecurity that goes along with it, and their fear its negative effects such as job loss, decline in income, status and prestige or the loss of coworkers due to downsizing and outsourcing. Communication in an open and supportive environment is essential, with full participation in the process without fear of retribution, and leaders must be involved directly and continually (Self and Schraeder, p. 176).

Self and Schraeder (2009) discussed readiness strategies for reducing or overcoming resistance to organizational changes. Change has become more rapid in the last thirty years due to globalization, technology, increased competition and a volatile economy, but within organizations most change efforts “fall short of intended goals” and at least half fail completely (p. 168). Resistance to change can be active or passive, and runs the gamut from spreading negative rumors to procrastination to outright sabotage. Certain personalities have a low tolerance for change, greater fear of uncertainty, or fear of failure and the unknown. They may distrust the management of the organization of its change agents,, feat the loss of their jobs and economic security, especially if the organization has “a track record of botched change efforts” that causes cynicism and apathy among employees (Self and Schraeder, p. 170).

Peter Drucker noted in 1993 that the world was going through a major political, economic, cultural and technological transformation and that business organizations were experiencing great difficulties in keeping up with change. CEOs needed to become planners, counselors, visionaries and team builders rather than top-down authoritarian managers. Moreover, when “the values of management diverge significantly from those of the workers, leadership success by definition is impossible to achieve” (Sarros and Santora, 2001, p. 384). A Multifactor Leadership Questionnaire (MLQ) and interviews administered to 181 executives in Australia did not necessarily uncover clear distinctions between transactional and transformational leaders. Over 90% of those surveyed were male, 54% over age 50, 72% with a university degree, and were employed both public and private sector organizations with 500 or more employees. On the transformational leadership spectrum, Australian executives did care about people as individuals, but also used a “strong, tough approach” that they regarded as necessary to get results (Sarros and Santora, p. 385).

Many Australian executives believed that managers were not inspirational, though, and that it often stifled innovation, experimentation and creativity. Other areas of transformational leadership include intellectual stimulation of employees through coaching, morale building and problem solving, and idealized influence with the leader as a role model. In reality, Australian executives practiced several different styles. Although they preferred coaching and inspiration, they also used more authoritarian methods. They might try to be communicative and compassionate, but and the same time set very high standards and “believe they are accountable for their company’s successes and failures” (Sarros and Santora, p. 390). They were confident about their ability to stimulate workers intellectually but reluctant to offer praise or express too much emotion (Sarros and Santora, p. 391). They did not see a conflict between transformational and transactional leadership, which offered “tangible, material rewards,” but also led from the top through setting examples (Sarros and Santora, p. 389).

Management by exception was also a common method by which leaders set overall goals then trusted workers to carry them out, although without much emphasis on vision, excitement or new horizons. On they other hand, they had little regard for laissez faire leaders who abdicated their managerial role and had little involvement or personal interaction with their employees. Bass and Avolio (1999) were limited in the sense that they ignored the full range of possibilities in leadership behaviors, such as setting specific task goals, networking, negotiating and also the reality that the difference transformational and transactional leadership is “ambiguous and unclear” (Sarros and Santora, p. 391).

Lucas (2010) studied three factors that influenced successful change in organizations: teams, collaborative culture and the capacity for accounting. Change will not be successful without these, and this is “not an easy process because it requires both content and process adjustments” (Lucas p. 420). In addition, there is often “a mismatch between what has been transferred and the context in which is being applied,” and change will fail if it lacks a supportive culture from management (Lucas, p. 421). Successful change also depends on a champion who raises consciousness about the necessity for change and offers rewards for those who adapt to change. Teams will be beneficial for facilitating exchanges of information, and interaction between various skills and specialties that compliment each other. A culture of sharing and participation is necessary as well since it helps employees “become aware of new ways of doing things.” An organization must also possess that absorptive capacity to make change easier and “to acquire, assimilate, transform and exploit organizational practices” (Lucas, p. 424). This is the type of environment that facilitates knowledge-transfer to which teams and informal networks will contribute.

Randall and Coakley (2007) discussed the role of adaptive leadership in the context of the failure of a small private college and the revival of a declining graduate program. In the former case, the changes enacted by the leadership in a top-down model “failed to impact favorable on the crisis the college was facing” while in the second case the chair of the department employed “the adaptive leadership process to facilitate successful transformation” (p. 326). A successful transformational leader like the chair of the department put forward the time and effort to involve all the major stakeholders in the change process, while the interim presidents of the college were unwilling or unable to do so, and their institution went bankrupt.

Adaptive leadership focuses less on executives or elites and more on the process of change, and “the specific problems at hand” and ways of modifying failed policies of the past. Adaptive problems are not technical problems that can be resolved with incremental or transactional leadership, and “solutions are not known in advance” but come only from all the relevant stakeholders (Randall and Coakley, p. 328). Adaptive change has six stages: identifying the problem (adaptive or technical); focusing attention of all stakeholders on the problem; framing issues to sustain attention and find solutions from the stakeholders; managing conflicts so that those “with different agendas” can be “aligned to achieve a higher purpose”; creating a safe haven, avoiding retribution, and building “a secure place to discuss disparate perspectives” (Randall and Coakley, p. 328).

At the private college, a move from the inner-city to the suburbs failed to result in higher enrollment, and when bankruptcy threatened the board of trustees replaced the president. During the crisis, the next president attempted to dictate change from the top-down, “seeking input solely from the Vice President,” but then has was fired by the Board as well when his changes failed. When the Vice President was appointed interim president, he finally persuaded the faculty to accept a pay cut, but failed to inspire them to recruit new students. The faculty regarded the college’s fiscal problems as the fault of the Board and the previous presidents, and would not take any ownership of the problem. They were cynical and demoralized, with no confidence in their leadership, and therefore the college went into foreclosure (Randall and Coakley, p. 329).

In contrast, the new head of the graduate program found that its loss of enrollment meant that it would soon be discontinued. Over the next three months, she called in all the faculty, students and staff and asked them to identify the problems and suggest solutions. Using the six-step process, she determined that the program’s problems were “complex and adaptive in nature,” and that all the stakeholders had a “sense of complacency, along with a pattern of blaming others” even though the department was in danger of being abolished (Randall and Coakley, p. 331). She formed a committee of stakeholders to review the problems with notes from the meetings published on an Internet bulletin board. This committee did take ownership of the change and decided to “completely redesign the program,” eliminating 60% of the old courses and reforming the rest. Throughout the process, the chair ensured that “the stakeholders became the advocates for such radical change” (Randall and Coakley, p. 332). Forums and online discussions maintained the momentum for change, while the chair created a safe haven and remained aloof from all conflicts, while publicly praising those who made useful suggestions. As a result, the department was turned around, students were excited about the program again, and enrollment increased for the first time in many years.

RasGas is a joint venture company, with Qatar Petroleum and ExxonMobil as primary shareholders. ExxonMobil is a mature and well respected company in the oil industry, with a long history of demanding excellence from its technical staff. There are a limited number of ExxonMobil “secondees” to RasGas, most of these come from the highest potential performers in the company. ExxonMobil has implemented matrix management for their subsurface production support teams, and have a considerable amount of experience with the concept. The role of ExxonMobil secondees within RasGas, and the position of the ExxonMobil secondees within RasGas, places them as credible role models and ambassadors for the change. This manifested itself through the positioning of secondees as facilitators for the instantiation of the Asset Surveillance Teams. In spite of the fact that RasGas had a shareholder to lean on for guidance and support in the Asset Surveillance Team implementation, one of the most powerful engines for change was the message from the subsurface management that

All answers and solutions were not known, and RasGas requirements, while similar to those that motivated ExxonMobil to pursue Asset Teams, are unique within the industry.

This was a voyage of discovery where everyone would play a part and contribute

Everyone’s contribution was needed in order to make it a success

This approach was essentially an empowerment of employees to take ownership of the successful implementation. The intellectual stimulation of each of the team members required in order to realize the benefits of the change is probably one of the most singular characteristics of the change. Each and every team member is challenged not only to perform, but to invent new and innovative solutions to maximize the potential of the Asset Surveillance Team. Individual Consideration has been a challenge to the success of the project. The idea of improving the overall performance through the efforts of a team diminishes the perceived contribution of individuals. When addressing how to properly reward team performance, the methods are primarily focused on the teams rather than the individuals within the team. This has become the greatest obstacle to realizing the potential of this initiative. This is addressed in further detail in the section on “Post Implementation.”

Steven Covey’s model of leadership contains within it four roles, and match of these roles to the Job Family implementation appears to be better than the match for the Bass and Alovio model, as described in the following sections. The path-finding features are fairly well represented in the change:

The management articulated to the employees their vision, and it was one that the employees could easily share in.

The articulation of what was important to management was clear, and contained within it value to the team members.

The purpose for the change was obvious and clear.

The direction of where the company was going was also very clear, as was the approach. The exact path to get there was not completely clear, however. This relied on the individual’s to accept some level of uncertainty about how they would work with each other, and what the expectations on them would be. This can be very unsettling for employees, and as such this is a very clear match to the path-finding component of Covey’s leadership model, although the last element is not fully addressed by the implementation approach.

The initial direction given for the Teams did not provide a body of work that they could use to direct them. They were, in fact, expected to develop their own methodology, and to invent how they would work together. In this case, there was a lack of alignment exposed to the team on how the individual contributors and separate Asset Surveillance Teams would achieve the strategy. Also mentioned in the review of the Bass and Alevio model, the empowerment of the employees to contribute to the successful adaptation of Asset Surveillance Team was a key component in the deployment. The members of the team, and the team themselves, were given near-unlimited freedom and authority to direct their efforts. This has not fully been taken up by all of the members of the teams, and is one of the main shortcomings of the implementation. As such, it is an example of how important this aspect can be to the successful implementation of a change. This is the area of focus in the redirection of the Asset Surveillance Teams in the upcoming year. The role models presented through the Asset Surveillance Team leads, as previously described in “Idealized Influence,” are a match with the modeling feature of Covey’s leadership model. However, the implementation of this may have suffered due to the rotating nature of the position. A recently adopted change to this earlier model is the identification and assignment of “Coaches,” who will provide more continuous guidance and direction to the team members.


At RasGas the upper management set general guidance in direction and expectations, with the expectation that the change would incremental in type. The first line supervisors and technical advisors were given space to shape and coordinate the process through which the teams would produce. Yet objectives were intentionally or unintentionally left vague in order to not stifled creativity and learning through rigid mandates. The teams were advised to direct their way and find their own solutions to the challenges being presented. This is very clearly a transformational leadership approach. At this point in the development of the Asset Surveillance Teams, this may be “a bridge too far.” Not all of the Asset Surveillance Team members have embraced the work responsibilities as fully as others, and the burden for team products is falling on a few shoulders. The team members are not yet willing to accept that team recognition comprises adequate recognition of their individual efforts. As a consequence, for known important tasks such as delivery of certain work products such as Production Logging Tool and Pressure Transient Analysis reports, a transactional approach that created competition and reward performance was utilized. The concept that fully realizing team performance must in some manner address individual contribution is being evaluated, with remedies to be further implemented to test and validate this concept.


Brisson-Banks, C.V. 2010. “Managing Change and Transitions: A Comparison of Different Models and the Commonalities.” Library Management, Vol. 31, No. 4/5, pp.241-52.

Brown, A.D. 1994. “Implementing MRPII: Leadership Rites and Cognitive Change.” Logistics Informational Management, Vol. 7, No. 2, pp. 6-11.

Drew, S. And C. Coulson-Thomas 1996. “Transformation through Teamwork: The Path to the New Organization?” Managerial Decision, Vol. 34, No. 1, pp. 7-17.

Eisenbach, R. et al. 1999. “Transformational Leadership in the Context of Organizational Change.” Journal of Organizational Change Management, Vol. 12, No. 2, pp. 80-88.

Erwin, D.G. And A.N. Garman 2010. “Resistance to Organizational Change: Linking Research and Practice.” Leadership Organization Development Journal, Vol. 31, No. 1, pp. 39-56.

Fawcett, S.F. et al. 2010. “Mitigating Resisting Forces to Achieve the Collaborative-enabled Supply Chain.” Benchmarking: An International Journal, Vol. 17, No. 2, pp. 269-93.

Garrity, R. 2010. “Future Leaders: Putting Learning and Knowledge to Work.” On the Horizon, Vol. 18, No. 3., pp 266-78.

Karsten, L. et al. 2009. “Leadership Style and Entrepreneurial Change: The Centurion Operation at Philips Electronics.” Journal of Organizational Change Management, Vol. 22, No. 1, pp. 73-91.

Lucas, L.M. 2010. “The Role of Teams Culture and Capacity in the Transfer of Organizational Practices.” The Learning Organization, Vol. 17, No. 5, pp. 419-36.

Michaelis, B. et al. 2010. “Shedding Light of Followers’ Innovation Implementation Behavior: The Role of Transformational Leadership Commitment to Change, and Climate for Initiative.” Journal of Managerial Psychology, Vol. 25, No. 4, pp. 408-29.

Randolph, L.M. And Coakley, L.A. 2007. “Applying Adaptive Leadership to Successful Change Initiatives in Academia.” Leadership and Organization Development Journal, Vol. 28, No. 4, pp. 325-35.

Sarros, J.C. And J.C. Santora 2001. “The Transformational-Transactional Leadership Model in Practice.” Leadership Organization Development Journal, Vol. 22, No. 8, pp. 383-91.

Self, D.R. And M. Schraeder 2009. “Enhancing the Success of Organizational Change: Matching Readiness Strategies with Sources of Resistance.” Leadership and Organization Development Journal, Vol. 30, No. 2, pp. 167-82.

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