Change is an inevitable part of contemporary organizations. Firms around the globe are always required to frequently change their strategies to ensure that they operate more efficiently, especially in ways that would position them to meet their customer demands and operate profitably. In realization of the criticality of change, this paper outlines an organizational change plan that would enable American Airlines, one of the most reputed commercial airlines around the globe, to cut on its costs of operation and improve its profit margin. The change plan developed in this paper follows the Kotter’s 8-step change model, which is constructed in consideration for the human side of change—the fact that people always have a natural tendency to resist change, and that they should be convinced to perceive the effectiveness of the proposed changes. The plan underscores the importance of communication as individual leadership action, which pegs on the creative and relationship competencies of the leadership circle profile and training as an organizational leadership action that inclines to the task and creative competencies.
Organizational Change Process Steps for Cost Reduction at American Airlines
The Kotter 8-step organizational change model would be the most suitable for cost cutting at American Airlines. The first step of the model directs the need to create a sense of urgency, which means that the change leader should inspire others to perceive the need for change and the opportunities that they would gain when they act immediately (Kotter, 2007). In line with the idea of cost cutting, it would be plausible to suggest to the employees and the management that immediate cost cutting would translate to more profits for the company. The next step of the model would be to build a guiding coalition, which essentially implies the need to assemble a team that would lead the change process. It would be important assemble the team from internally and to outsource change management expertise since having this mix of people on the team would guarantee both internal knowledge of the firm and external change management skills that would improve the results (Kotter & Cohen, 2008). After the change management teach shall have been assembled, it would work on formulating the strategic vision and initiatives of the change, which entails clarifying the way the future would look like after the change shall have been initiated.
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The fourth step would be to enlist a volunteer team whose role would be to maximize the chance that the change planned shall be successful through rallying the rest of the employees and other stakeholders to support the proposed change. This fourth step is useful because it attains a unified approach to change, which lowers the probability that of resistance and failure (Varkey, & Antonio, 2010). The fifth step of the plan would be to enable action through the removal of barriers to change. The barriers that would be considered for this case include inefficient processes and hierarchies that reduce the freedom required to work across different silos and create real impact in cost reduction for the company.
The sixth step of the plan would be to create a list of short-term wins that would be important in gauging the potential success of the operations. Breaking down the overall goal of cost reduction into small deliverables would always ensure that the team reviews its strategy for change frequently and to align the plan with the available resources for the change with the potential of reducing the chances that the change would succeed (Varkey, & Antonio, 2010). The seventh step of the change plan would be sustain the acceleration towards attaining the set objectives. The meaning of the step is that the project team would be required to ensure that they press harder towards realizing the overall goal once they achieve the first milestone defined in the sixth step of the change process. Lastly, the Kotter model of change process suggests the need to institute the change, which implies the requirement to achieve the final objective of cost cutting.
The Importance of Importance of Following the Eight Steps in their Identified Order
The eight-step model of the change process considers the chances of change resistance from stakeholders at the company. Consequently, the preliminary stages of the plan are concerned with winning the support of stakeholders and increasing the chances that it would succeed as opposed to imposing the changes on the company. Considering the human side of change, resistance is always high at the initial stages of initiation, and it fades off with time when the stakeholders start realizing the likely benefits of adopting the proposal to change (Galpin, 1996).
Individual and Organizational Leadership Actions
Effective communication would be the most important individual leadership action necessary for the success of the proposed change plan. Communication inclines to the creative and relationship competencies on the leadership circle profile. Communication would always ensure that the team and stakeholders of the company remain committed to the success of the project. The organizational leadership action considered appropriate for the plan is training. Training focuses on the creative and task competencies of the leadership circle profile. The proposed leadership actions would ensure that the firm focuses on the task of cost cutting both in the short-run and in the future considering the combination of creativity, amicable stakeholder relationships, and the task at hand.
References
Galpin, T. J. (1996). The human side of change: A practical guide to organization redesign . San Francisco, CA: Jossey-Bass.
Kotter, J. P. (2007). Leading change. Harvard business review , 85 (1), 96-103.
Kotter, J. P., & Cohen, D. S. (2008). The heart of change . New York: NY, Sage.
Varkey, P., & Antonio, K. (2010). Change management for effective quality improvement: a primer. American Journal of Medical Quality , 25 (4), 268-273.
