Research Proposal - Change Management: Adoption of the Learning Organization Concept in UK SMEs

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Change Management: Adoption of the Learning Organization Concept in UK SMEs

            Change is sometimes needed within an organization in a sense that transition is necessary to be able to compete with the changing patterns of the business world. For instance, globalization, new organizational philosophies and structures, technological developments, and ICT developments combine (Stewart, 1993) have contributed to the transitions that countless of firms have undergone throughout the last few decades. Old ways and some traditional methods and tools are becoming obsolete, forcing organizations to reformat almost every context within their organization. Basically, it involves structuring the organization into new heights, to become more competitive and more responsive to the needs and demands of the customers, as well as to the needs and demands of the company itself. After all, structuring of organization is important in achieving synergies and effectiveness. Organizational structure is the framework within which brands are managed successfully or otherwise (Hankinson, 1999). One can notice that this statement imposes that organizational structure helps the management in taking the organization into “progress” or on the other hand, into “ruin”. But then, how can changes in such structure are achieved? Of course, it is easy to say that a new policy will be integrated within the company, say for instance, a new productivity guideline, or a new management approach. However, the efficacy of such reforms still lies in the hands of the people who run the organization or who work for the organization. Without the enough knowledge and skills about the reform, and the cooperation of the employees, any changes that are implied within the firm will be ineffective and will fail. This is where change management comes to place. Change management should not be mistaken as a management for the change itself, but should be known as the management of the people within the organization who will perform the change (Moran and Brightman, 2001).

            Change does not only take place within large corporations but can also be applied by small to medium-sized corporations. In fact, due to the changes brought by globalization and the others, undergoing fundamental transitions may well pose a particular challenge to SMEs, which limits their abilities to maintain their position against larger competitors in rapidly changing business environments (Moran and Brightman, 2001). For instance, in today’s modern world, most companies have already abandoned the ways of acquiring and storing data, or in other terms, data management. Most have adopted the use of Information Technologies for such tasks. In this matter, Siriginidi (2000) stated that IT plays a vital role in improving coordination and information access across the enterprising units and allows more effective management of task interdependence. SMEs that cannot afford to adjust such changes fall at the bottom of the competition. However, another problem is that even though they have the capability to adjust their technology, there is still the problem within the employees, i.e. familiarity with the technology, using the technology, abiding the rules when using the technology, etc. Basically, learning should be intertwined with the reform. Learning is another variable to be dealt with within the change process. This paper proposes a study that aims to determine the issues involved within the utilization of learning in SMEs for an effective change management. Furthermore, the barriers on effective implementation will be explored as well as how they can be overcome. In this proposal, the research questions will be presented, as well as the outline of the literature review and the methodology to be used.

Objectives of the Study

            The objective of the study is to investigate to what extent SMEs utilizes systems thinking and the disciplines of the Learning Organization to develop effective strategies for managing in today's turbulent business environment.

Systems thinking basically involve the ability to look at a problem as part of an interrelated system. After seeing the problem in this light, systems thinking allow the problem to be solved through modification of the entire system. It is the ability to view things holistically that ensures a solution will not just be a quick fix, but a more permanent solution.

The study also aims to identify barriers within the sector in fully adopting the learning organization concept, and to recommend how these barriers can be overcome. The research will focus mainly within SMEs in the service sector in the UK, which preferably would be the construction industry, because of its condition of being subjected to many reforms. The researcher will focus on this specific set of SMEs to avoid discretion and comparison of the responses of different sectors. Another objective of the study is to be specific as possible, to avoid ambiguity and other disadvantages of generalization. The Construction Best Practice in the UK (2003) cited from the research of Eclipse (2003) that

There is difficulty to generalize across all small firms i.e. there is a huge difference in management, structure and activities between a construction firm with 49 employees, and one employing 10. The logic is: what more if research would generalize small firms in all sectors? This specific approach will make this research more feasible.

Statement of the Problem

            The UK construction industry is one of the strongest and most important among the country’s service sector - providing a tenth of its gross domestic product, & employs 1.4 million people (DTI UK, 2004). However, it is also one of the industries that face serious scrutiny in terms of service. According to the Egan Report (DTI UK, 2004), many clients are dissatisfied with the industry’s performance. In the early 1990s, the overbuilt markets, overheated economies, overextended developers and, indeed, simple greed and mismanagement, led to a significant decline in construction volume (King, 1998). In order to improve this, certain radical guidelines such as the Latham and Egan Report have been required to every UK construction company in the UK (DTI UK, 2004). Because such guidelines are new, they obviously should bring change, which is their motive nonetheless. Improving certain areas of service basically means changing them for the better. However, SMEs in this industry might have problems in implementing the guidelines, as well as other change concerns such as technology reform, etc. The Construction Best Practice (2003) cited from Eclipse (2003), that UK small construction companies and found that they are still immature in terms of learning and change. This fact makes it interesting to investigate the context of learning within them and how it affects their process of change. Yisa et al (1996) stated that the construction industry faces a continuous circle of changes in workload, work mix and the method of managing the changes and, by definition, changing its product all the time. The nature of the industry is such that it is not capable of being planned, i.e. its dynamic environment prevents any long- and medium-term planning (Yisa et al, 1996). The question is if there is a place for systems thinking and other elements of learning within small companies in the nature of the industry. All in all, the researcher will try to answer the following research questions:

1.         How do UK small construction firms view learning within the organizational context?

2.         What are the methods that UK small construction firms use for learning?

3.         What are the fundamental determinants of change in UK small construction firms?

4.         Does their networks play important role in learning?

5.         What are the barriers to learning in UK small construction firms?

6.         How can barriers be overcome and what are the options for improving learning and change in the UK small construction firms?

7.         Do UK small construction firms have effective change management?

8.         What is the level of compliance of UK small construction firms on the elements of learning in Senge’s learning organization theory?

           

The hypothesis of the study is that ‘UK small construction firms use learning as a tool to be able to pinpoint organizational areas that are needed to be changed’. However, the existence of many barriers to the implementation of change and the lack of appropriate change management makes the acquisition of knowledge useless. The researcher perceives that UK small construction firms need empowerment to be able take the risk of change and apply an effective change management.

Outline Literature Review

            The literature review to be presented in the actual study will include literatures that encompass the issues in change management, learning organization, and the construction industry in UK. The construction industry is the newest variable, as it was decided that it will fit well as a specific independent variable for SMEs. However, most of the literatures to be presented will be on change management and the learning organization.

            The first part of the literature review will focus on change management and the different principles underlying it. For instance, the journal article written by Collins (1996) provided interesting information about the new paradigms of change. Its basically a discussion about which is better: the new paradigm of change management; or the old one. He basically attempted to appraise the claims made as to the need for and existence of new paradigms geared towards the study of change and argued that the so-called new paradigms amount to little more than the recreation of the functionalist goals.

            Another interesting reference is the journal article of Limerick, Passfield and Cunnington (1994), which focuses on tackling the issues on the role of the charismatic and evolutionary versus revolutionary change. This article involves discussion about the nature of change and other useful information about change management.

            The article entitled ‘learning organizational change’ by Moran and Brightman (2001) can also be useful as it discusses several general facts about change management including identity, mastery, the change cycle and the change management cycle.

In terms of learning, the article of Watkins and Marsick  (1992) will help provide information about the elements of change in Senge’s model. This will include discussion about the seven elements of organizational change namely: systems thinking; personal mastery; mental models; building shared visions; team learning; dialogue; and leadership. Another article about learning that can useful is from Wyer et al (2000). Their article proffers a tentative conceptualization of the ‘small business strategic learning processes’ and demonstrates the complexity of small firm learning and management task.

            Those were just some of the literatures to be reviewed in the actual study. The researcher will provide more, which also include some literatures about the UK construction industry. The outline is that change management will be tackled first, followed by learning organization, and then followed by change management in UK construction industry.

Methodology

Research Design

The research to be conducted will be a descriptive type. A descriptive research intends to present facts concerning the nature and status of a situation, as it exists at the time of the study (Creswell, 1994). It is also concerned with relationships and practices that exist, beliefs and processes that are ongoing, effects that are being felt, or trends that are developing. (Best, 1970) In addition, such approach tries to describe present conditions, events or systems based on the impressions or reactions of the respondents of the research (Creswell, 1994).

            The research is intended to provide statistical facts and thus will employ quantitative data collection and analysis. Quantitative method is compatible with the study because it allows the research problem to be conducted in a very specific and set terms (Frankfort-Nachmias & Nachmias, 1992). Besides, a quantitative research plainly and distinctively specifies both the independent and the dependent variables under investigation (Matveev, 2002). It also follows resolutely the original set of research goals, arriving at more objective conclusions, testing hypothesis, determining the issues of causality and eliminates or minimises subjectivity of judgment (Kealey and Protheroe, 1996).

            However, its weakness is that the paradigm breaks down when the phenomenon under study is difficult to measure or quantify (Steckler et al, 1992). Furthermore, the greatest weakness of the quantitative approach is that it decontextualizes human behavior in a way that removes the event from its real world setting and ignores the effects of variables that have not been included in the model (Steckler et al, 1992). With regards to the literatures to be reviewed in the study, most articles conducted qualitative or secondary research and refrained from using statistical basis. However, the Construction Best Practice (2003) stated that empirical basis for the area is needed as most studies in UK construction SMEs were conducted through qualitative method. This study aims to take the challenge of taking a quantitative research approach on the issue.

Data Collection

            Survey will be used in the research with the use of a self-administered questionnaire. The primary purpose and advantage of surveys is generalization of the results (Commonwealth of Learning, 2000). The Likert Scale will be used to measure the level of agreement on each question. However, its main disadvantage is that it may not collate deeper thoughts or may restrain the respondents from expressing what they actually want to say. However, the research will be quantitative, thus survey is required. But then, questions will be constructed thoroughly to acquire the desired and needed responses.

Respondents of the Study

            The samples in the study will be chosen through one-stage cluster sampling. Contrary to simple random sampling and stratified sampling, where single subjects are selected from the population, in cluster sampling the subjects are selected in groups or clusters. This approach allows overcoming the constraints of costs and time associated with a much dispersed population like SME construction firms in UK. However, its limitation is that only few respondent will be covered in one area in the UK.

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