Problems with changing culture

One problem with changing culture is that there may be a resistance to the cultural change. This may be because of an old, loyal workforce as seen at Royal Mail.

Cultural change is needed as the company faces privatisation and increasing competition from its large e-commerce rivals. However, most of Royal Mails employees have been with the company for decades, they may be resistant to such a change from their existing culture, to a fast-paced and profit driven culture, as they are focussed on self-interest.

It is therefore likely that Royal Mail’s employees have a low tolerance to change, as they are keen on the security and stability of their work, changing the culture threatens this stability, and can cause some resistance.

Resistance, as Kotter explained can come from lack of communication causing a miss-understanding at Royal Mail. It is likely that the workers will feel their job is at risk to be replaced with technology, it can be this worry that manifests itself and creates a group problem, and this can lead to industrial action, because the method of the cultural change hasn’t been addressed.

For an effective change in the culture, the communication of the issues and changes must be clear to all of the employees. This creates a mutual understanding and will ease the changing process. Herzberg’s hygiene factors, also point to a possible area of conflict, as any changes in their working conditions amounts to frustration from employees. It may also be said that a sense of security and belonging, as spoken about by Maslow, may be threatened when a business wants to change its culture.
However, the significance of the resistance depends on whether the force driving change exceeds the force of resistance. Lewin’s suggests; this means that for Royal Mail to effectively change their culture, and keep the resistance down, they must look at their internal communication between the new CEO and the employees.

The success of the change depends on the mutual understanding at Royal Mail, and how confident each and every employee feels with its implementation. If no change occurs in Royal Mail, it will mean that its e-commerce competitors will gain a huge advantage – over the one they already have, the business may have to use hard human resources management and make redundancies to workers and may have to shut down operations in certain places whilst adopting a retrenchment strategy. This will have an impact on consumers, and their beloved UK Company could be no more. The significance of Royal Mail failing as a business is huge – especially as it was the model many other countries built their mailing systems on. If the change is good, and made in good time, the new strategy will become a success, and therefore allow Royal Mail to keep up with its e-commerce rivals.

In addition a business may face problems with changing the culture of a business it has recently taken over. One business to face this was supermarket Morrison’s, during their takeover of their larger rival, Safeway. The top managers at Morrison’s failed to recognise such a cultural difference between the two businesses; Morrison’s was a family-run, customer service conscious brand, whereas Safeway was impersonal and bureaucratic focusing on how to get the biggest profits. The two types of culture attempting to mix saw little motivation from Safeway employees, and lowered the morale of the business, as well as its profits. It affects the culture as a whole when morale is down and can have an impact on the customer service that a business provides. If the service is repeatedly bad, customer loyalty can leave and it can create a gap for competitors to fill; although Morrison’s managed to keep their original customers loyal, they did struggle to grow that base within their Safeway takeover. Success of takeovers and mergers depends on a well-thought out plan, and this must include the culture differences. Morrison’s faced problems when trying to change the Safeway culture in to their own, this lessened profit for both the existing Morrison’s stores and the converting Safeway ones, leading to profit warnings and a decline in shares. 

In contrast, TATA’s takeover of Land Rover was well thought through, TATA kept all the trade unions, employees and UK government fully included throughout the purchasing process. This significant level of communication is one of the reasons that TATA did so well in keeping a good culture within Jaguar Land Rover, and has led to a loyal and motivated workforce furthering the product range the factories build. It is a prime example of how good communication can keep the culture of a business positive when merging to completely different firms.