David Jones is one of the oldest fashion departmental stores in Australia. For a long time, this company has been held at heart by Australians who got the opportunity to see it rise, fall, and persevere. In 2010, right when the company was going under, Paul Zahra took the reins from Mark McInnes to become the chief executive officer. Zahra came up with a plan; a change to take the company back to profitability, win back Australians' hearts, and return the company to its glory days. The sixth edition of the book Organizational Change: Development and Transformation, written by Dianne Waddell, Thomas Cummins, Andrew Creed, and Christopher Worley, studied David Jones's change in detail. This paper seeks to critically determine whether David Jones's operational change, as discussed in the book, was impactful or not and give suggestions on alternatives to make it more dynamic.
Current Financial and Operational Situation
David Jones currently has forty-eight retail stores, with two being in New Zealand. The company's valuation as of 2020, is 985 million dollars, which is a massive decline compared to its value of two billion dollars when Woolworth Holdings bought the company. The covid-19 pandemic unpredictably hit David Jones, and other companies, which saw foot traffic to retail stores and total sales decline enormously. David Jones was still striving to be sustainable before the pandemic, which has now anchored it and pulled it closer to rock bottom. Overall profitability has declined, though online sales doubled post-pandemic. Hope is not all lost. David Jones seeks to downsize and close some of its non-profitable stores in Australia. Woolworths Holdings has loaned seventy-five million dollars, to improve sales and change operations, and has set aside twenty-five million dollars, for granting upon request. The paradigm shift to online retailing might be the company's Hail Mary during this difficult time.
Paul Zahra's Remedy Strategy for David Jones
Before 2010, David Jones was generating revenue under the reins of Mark McInnes. However, this gradual rise to grace quickly turned south after Mark McInnes's sexual harassment claims with a female employee gained infamous traction all across Australia. Mark later resigned, and Paul Zahra came in to hold the forte. At that moment, David Jones was facing stiff competition globally. Australians were opting to purchase online and benefit from free shipment instead of shopping locally, which was comparatively more expensive. Zahra concocted a three-pronged approach to change the company. The first prong was to become favorable among Australians by working with smaller retail stores that provide precisely what the customers want. The second prong was to cement its market position as the leading fashion brand in Australia by working with local designers to supply some of their products exclusively to David Jones (Waddell, Creed, Cummings & Worley, 2017). Still, Zahra would bargain to reduce the cost of supply on this prong, hence reducing the overall price to compete at a level turf with other fashion brands that operate globally. The third prong was to open an e-commerce platform that would allow customers to shop online or through their footstores (Waddell, Creed, Cummings & Worley, 2017).
Unfortunately, during Paul Zahra's tenure as chief executive officer, David Jones did not perform as well as envisioned. Under the support of the board, the approach deployed by Paul Zahra was strategic though it did not focus on changing the company's culture (Shani & Noumair 2019). Research depicts that a company's culture dates back to its founding and is the glue that binds the company and makes it admirable among customers and employees (Shani & Noumair 2019). Among the three prongs, the company should have focused on amending the broken trust between employees, management, and customers by apologizing for the sexual harassment claims and, henceforth, coming up with a plan to improve the working environment (O'Neill & Salas 2018). David Jones should have focused on the company's culture, which would improve the staff's confidence in the company and eventually stretch out to customers.
Planned Change Models
Planned change models are sequential steps employed by a group when executing a change in a company. Lewin in 1958, Lippit in 1980, and Bullock and Battern in 1985, all described planned change models. Lewin narrated three steps involved in a change which are; unfreezing, moving, and refreezing. In the unfreezing phase, a company desires to willingly change (Bahari, Ismail & Bakri, 2015). The company progresses to commit to the desired behavior in the moving phase. The company builds on a change and ingrains it into its corporate culture. Lewin commented that it is necessary to remind the group why there needs to be a change because a change can be desirable but undergo resistance. (Bahari, Ismail & Bakri, 2015).
Lippit built on Lewin's planned change model by illustrating that a change is more likely to stick if enacted in the system where it is relatable. His emphasis was on bringing change to the systems that require it. His model of change involves seven steps, which are:
- Exploring where a change is required
- Diagnosing the problem
- Planning to change
- Setting strategic actions
- Stabilizing the change
Bullock and Battern took a similar approach to Lippit's model by describing 4 phases for organizational change (Bahari, Ismail & Bakri, 2015). They include:
- Exploration to create need and awareness
- Planning by diagnosing and creating a strategy
- Action by implementing and evaluating
- Integration – diffusing a change in the organization
Of the three planned change models described, Lippit's model would best suit David Jones's change under the reins of Paul Zahra. Lippit's model focused on knowing which systems or processes within an organization require a change (Bahari, Ismail & Bakri, 2015). As narrated earlier, the changes that David Jones enacted through a three-pronged approach were beneficial to operations and finances but not to its culture, which had been tainted by the alleged sexual harassment claims on Mark McInnes (Bahari, Ismail & Bakri, 2015). There were a disconnection and unresolved tension between management, employees, and customers. Lippit's planned change model would have enabled David Jones to diagnose the problem that needs addressing before planning, creating a strategy, and implementing the change (O'Neill & Salas 2018).
The scale of Change Model
Dunphy and Stace explained that management should seek awareness of the type of leadership in the company for efficient changes. Dunphy and Stace introduced four scales of change: fine-tuning, incremental adjustment, modular transformation, and corporate transformation. As per David Jones's case study, the scale of change model that this company went through with Paul Zahra was modular transformation. Modular transformation involves a restructuring of departments, which David Jones did by opening and working with smaller departmental stores to capture a customer's positive attitude to the company. Modular transformation involves reforming departmental goals, which David Jones did when choosing to work with local suppliers and reduce the cost of supplies (Rajan & Ganesan 2017). Lastly, in the third prong, David Jones desired to develop an e-commerce platform to capture online customers' attention. In the scale modular transformation, an organization expands to new products or markets (Rajan & Ganesan 2017).
Building a Strong Online Presence for David Jones
David Jones desired an online presence once they noticed that customers were shopping online through their phones. The majority of the company's competitors were from global fashion companies. The first step David Jones should have taken is building an e-commerce platform where customers can reach for information, customer complaints, or purchase products. The website should offer a great user experience by being simple, secure, fast, and attractive. Call-to-actions should be functional as intended.
Subsequently, David Jones should leverage social networks to reach and engage their customers. Having a Twitter or Facebook account is not enough. David Jones should interact with its customers by posting engaging content. Fashion has a tremendous impact on the youth, especially if the trend movements are from celebrities. Most fashion trends begin in social networks; hence David Jones should not miss these activities. Establishing an online presence would require David Jones to know the social channels used frequently by target customers.
David should set up their business on Google, my business. With Google being the most trafficked search engine, having a Google My Business account would make David Jones visible to customers outside Australia and New Zealand. David Jones should expand to intercontinental shipping to claim a percentage in the global fashion industry.
How to Implement a Change Using Kotter Eight-Step Model
Change is a group effort, not an individual movement. Change might cause an unhealthy work environment if the staff do not know about it or do not see its need (Canning & Found, 2015). In his book, Leading Change, John Kotter describes eight steps to enact change in an organization.
Management and staff in an organization should engage in sincere discussions about the state of the company. They ought to scan for threats and brainstorm for possible solutions. The team should communicate in a concerned and collaborative manner why change is necessary. Bringing in external consultants who are specialists in the systems or processes that require change will boost the team's confidence (Pollack & Pollack 2014).
Assemble a Robust Team
Top management executives should assemble a team in the organization that will have the mandate to implement and enforce change (Rajan & Ganesan, 2017). The metrics for putting together a team are competence in what requires change, job title and leadership, and communication strengths. For efficient change, the team should complement each other's weaknesses (Pollack & Pollack, 2014).
Create a Vision
The team should envision the organization after change because they will be motivated to chase it. Management should create a vision. Better again, having a slogan can help remind the team of the benefits ahead (Pollack & Pollack, 2014).
Communicate the Vision
People are naturally resistant to change because minds are wired to conform to the known norm (Canning & Found, 2015). Communicating the vision frequently ensures staff in the organization become motivated to push for change on those days when it might seem uncertain (Pollack & Pollack, 2014).
Executives should remove obstacles that might hinder change (Rajan & Ganesan, 2017). As change progresses, bureaucratic structures may prevent it from taking place, especially in a decision-making process. Management should scout for any hindrances and omit them (Galli, 2018).
Celebrate Short-Term Wins
In collaboration with the team chosen for change, management should break the project into manageable tasks and set timelines to assess progress and achievements. Early on in the change process, celebrating victories will raise the staff's esteem and motivate them to keep on (Geogalis, Samaratunge, Kimberley & Lu 2014).
Build on The Change
While it is good to celebrate victories, the triumph should not delude staff into thinking the journey is over. The team should seal the change in the work environment and ensure the staff does not revert (Galli, 2018)...
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