Ajax Minerals and Perrier Companies: Strategy of Change

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The Tuareg people in North Africa have a proverb that says: “When the music changes, then the rhythm of the dance must change, too”. Leaders of an organization may be the ones who choose the tune, but if it is not approved by the majority of the employees, the desired effect would not be achieved. On the contrary, the dynamics of the metaphorical dance would be irrevocably distorted, worsening the existing situation.

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Among the companies that had to deal with the resistance to change are Ajax Minerals and Perrier (Palmer, Dunford, & Alkin, 2009, p. 180). In both cases, the less-than-welcoming attitude of workers toward change originated from the problems in the way things were run. The two companies chose to address these issues differently; thus, the results differ, too.

According to Cameron and Green (2015), “Resistance comes from a fear of the unknown or a need for things to remain stable” (p. 116). As a rule, if the level of trust toward the administrators is low, any break in the pattern is perceived as a potential threat. That is the primary reason why the employees of Ajax Minerals were unwilling to implement change. In order to eliminate the workers’ suspicions and the general feeling of uncertainty, the managers adopted the “open book” policy (Palmer et al., 2009, p. 180). As a result, the relationship between the managers and workers improved considerably, with the employees gradually coming to rely on the leaders’ decisions. Therefore, their acceptance of the impending change increased.

Another source of resistance to change in the case of Ajax Minerals was the lack of the workers’ understanding of the problem. The change was necessitated by the potential threat of being defeated by a new entrant in the market. However, the vast majority of the workers failed to see that. Due to their limited knowledge, they saw the change as an unneeded inconvenience, which only made their lives more complicated. The managers of Ajax Minerals started conducting meeting with staff members with the purpose of explaining the problem. Vukotich (2011) states that “Educating individuals can jump-start their understanding of the need for change” (p. 89). In the case of Ajax Minerals, application of the “communication and education” method (Palmer et al., 2009, p. 172) helped reduce the resistance. This method was used in combination with that of “participation and involvement” (Palmer et al., 2009, p. 172). The above-mentioned policy of providing the staff with an insight into the company’s bookkeeping and finances, as well as the situation in the market, made them feel more involved and encouraged to care not only about their personal interests, but about the company’s success in general. As the workers became aware of the problem and got access to the books, which reflected the positive results of implementing change, their attitude became less hostile.

In contrast to Ajax Minerals, Perrier adopted a much more authoritative approach in managing change resistance. As a result, the already troubled relationship between managers and staff became even more strained. Worsening of the conflict served only to exacerbate the problem. Thus, when the management tried to motivate the workers by placing the competitor’s product in the cafeteria, their attempt was misinterpreted and met with resentment and aggression.

According to Vukotich (2011), “A major factor in getting individuals to go along with change is the level of trust they have in those initiating it” (p. 90). Hayes (2014) also cites lack of trust as one of the four main reasons for change resistance (p. 237). The Perrier staff was extremely distrustful of its management, largely due to existing precedents of downsizing. In the series of impending changes, meant to restructure the company, one consisted of the so-called “redundancy policy”, according to which, many of the employees were to be laid off or forced into early retirement (Palmer et al., 2009, p. 183). While such change might have been beneficial for the company’s financial success at the time, it was met with strong resistance from the workers’ union that perceived job opportunities for people who lived near production sites as Perrier’s moral obligation toward the communities whose natural resources it exploited. The confrontation was not resolved; the managers could not overcome the staff’s resistance to change because it was grounded on “the fear of losing benefits associated with the status quo” (Hayes, 2014, p. 59) and mistrust toward the company’s administration. Both of these factors are the most potent reasons for resistance; nevertheless, none of them was properly attended to by the managers.

It appears that Ajax Minerals’ strategy of change implementation was much more effective than that of Perrier. Not only did it successfully apply the situational approach, mostly through communication and education, but it also managed to achieve significant improvement of the level of trust between the workers and their bosses. The company proved its accountability to the employees and treated them with respect, instead of disregarding their concerns and dissatisfaction, as did Perrier. Vukotich (2011) suggests that in some cases ignoring the change resistance may make it “go away” (p. 99). However, this strategy always presents the risk of the problem escalating and becoming “more difficult to overcome if not addressed immediately” (Vukotich, 2011, p. 99). This is what happened with Perrier. In the end, the company could not subdue the protests of the workers’ union, which halted the restructuring.

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The difference in the way the organizational change was approached at Ajax Minerals and Perrier can be explained by the metaphor theory, outlined by Cameron and Green (2015). According to this theory, there are four key metaphors for implementing innovations at an organization (Cameron & Green, 2015, p. 133). The approach, chosen by the Ajax Minerals leadership, corresponds to the “organism metaphor” (Cameron & Green, 2015, p. 129), which is based on the perception of all stakeholders as vital organs, interdependent and equally important. On the other hand, Perrier represents the more traditional “organization-as-machine” model (Lewis, 2011, p. 17). There is a clear distinction between managers, whose role is to control and command, and the workers, whose function is to carry out the orders. Lewis (2011) suggests that it is possible to think of organizations that follow the “machine metaphor” pattern in terms of organisms, too; in this scenario, however, leaders and employees correspond to “head” and “body” (p. 17) instead of evenly matched parts. Therefore, according to this approach, managers do not need to negotiate with their subordinates and get their agreement.

As can be seen from the analysis of Ajax Minerals and Perrier cases, the democratic, egalitarian model turned out to be more efficient than the totalitarian one. However, there is room for improvement. First of all, to facilitate adjustment to change, one must understand the nature of the resistance. According to Reiss (2012), it can be of different types, such as “will barriers” and “skill barriers” (p. 87). The former category is based on the workers’ unwillingness to accept change. There can be different reasons for that attitude; as was previously discussed, the management of Ajax Minerals took appropriate measures to address those issues. Nevertheless, the absence of required skills can hinder the implementation of change, even if the workers are ready to accept it. Therefore, it is not enough to educate the employees only about the necessity of change and its meaning for the future development of an organization. In addition to that, they should be taught about what their new functions would include and how best to perform them.

Moreover, although the chosen approach of openness and inclusion is innovative and has many advantages, it can result in the lack of discipline and subordination among the workers. Thus, it would be beneficial to maintain a certain distance between the leaders and followers in order to avoid over-familiarity and questioning of authority. A just system of rewards and punishment should be implemented, as well. The workers would not be opposed to following rules, as long as they are aware of them and get fair treatment from the managers.

Certain measures could have been taken to help the workers adjust to change at the Perrier company, too. Vukotich (2011) emphasizes the role of peer pressure in accepting change, stating that “when it comes to the unknowns of change, [co-workers] look for consistency in others’ response” (p. 91). Thus, even convincing a small number of employees to accept the change could have had an impact on the general opinion. That requires manipulation and negotiation skills, as well as the inside knowledge about the tendencies in relations among the workers. If managers were able to convince a few of the subordinates, whose opinions were respected by the peers, they would have gradually overcome the resistance to change.

According to the three-phase model of change, the actual implementation of change, also known as the “move”, should be preceded by “unfreezing” (Hayes, 2014, p. 59). During this stage, employees are brought out of their state of habit-induced tranquility and made to realize the necessity of change. The persuasive potential of “dialogue” and communication (Vukotich, 2011, p. 99) should not be discarded. Even if the impending change has no supporters, openly discussing all the pros and cons is still a better alternative than ignoring the workers completely and forcing the change upon them. If the latter is the case, the management would surely have to deal with the workers’ inertia and protests, as is evidenced by the Perrier situation.

However, there is no universally right way of organizational change management. The situational approach is successful because it encourages flexibility and acuity. The managers have to understand the situation, to foresee the possible hindrances, and to “feel” the best way to overcome them. Besides, sometimes the workers’ resistance to change means that there are some drawbacks to it that only those most familiar with the production process can notice. Therefore, employees’ concerns should be listened to and carefully analyzed. Only after that, if they are deemed ungrounded, should the managers decide on the best course of action.

References

Cameron, E., & Green, M. (2015). Making Sense of Change Management: A Complete Guide to the Models, Tools and Techniques of Organizational Change. Philadelphia: Kogan Page Publishers.

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Hayes, J. (2014). The Theory and Practice of Change Management. New York: Palgrave Macmillan.

Lewis, S. (2011). Appreciative Inquiry for Change Management: Using AI to Facilitate Organizational Development. Philadelphia: Kogan Page Publishers.

Palmer, I., Dunford, R., & Alkin, G. (2009). Managing Organizational Change: A Multiple Perspectives Approach. New York: McGraw-Hill.

Reiss, M. (2012). Change Management: A Balanced and Blended Approach. Norderstedt, Germany: Books on Demand.

Vukotich, G. (2011). 10 Steps to Successful Change Management. Alexandria: American Society for Training and Development Press.

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