ABSTRACT
The study
examines managing change and employees performance in the electricity
generating, transmitting and distributing sector of Power Holding Company of
Nigeria. The objective was to ascertain how change can bring about employees
performance. The study use secondary data to discover that communication,
employee’s participation, raining and development have significant relationship
with performance. Based on the findings and conclusion, it was therefore recommended
that Power Holding Company of Nigeria should involve employees in their
managing change process to a positive result.
MANAGING
CHANGE AND EMPLOYEE’S PERFORMANCE IN THE ELECTRICITY GENERATING, TRANSMITTING,
AND DISTRIBUTING SECTOR IN RIVER STATE:
A
STUDY OF POWER HOLDING COMPANY OF NIGERIA (PHCN) PORT-HARCOURT, BRANCH
BEING A SEMINAR
PAPER PRESENTED TO
THE DEPARTMENT
OF BUSINESS MANAGEMENT
FACULTY OF
MANAGEMENT SCIENCES
IN PARTIAL
FULFILLMENT OF THE REQUIREMENTS FOR THE AWARD OF MS.c DEGREE IN BUSINESS
MANAGEMENT
TABLE OF CONTENTS
Abstract
TABLE OF CONTENTS
CHAPTER ONE: INTRODUCTION
1.1 Background of the
study
1.2 Statement of the
Problem
1.3 Objective of the Study
1.4 Significance of the
Study.
CHAPTER TWO REVIEW OF RELATED LITERATURE
2.1 Academic/Empirical
Review
2.2 Theoretical Framework
2.3 Other Issue
2.3.1 How to Introduce
Change
CHAPTER THREE: DISCUSSION
3.1 Discussion on how
stated Objectives can be met.
3.2 Discussion on Gaps
Presented in the Review Literature
3.3 Discussion on the
Theoretical Framework
Conclusion
Recommendations
References
CHAPTER ONE
INTRODUCTION
1.1 Background of the study
Business
organization operates in a dynamic environment which implies change. Change is
inevitable in any organization in other to remain competitive. In the ever
shifting world of business, change is inevitable and can come in different
forms. Change can involve virtually any aspect of an organization. It could
take the form of technological change, changes in products and services, work
schedules, machinery, organization design, people themselves and so on. Change
can emanate from within a business due to strategy changes, economic changes
and executive changes. The basic reason
that organizations make change is that something relevant to the organization either
has change or is going to change, therefore organization has little choice but
to change. Managing change effectively enables managers to stay ahead of competitors’
sets new standards and to embrace change in order to survive. The primary
reason for the problems that organizations often face is the failure to
anticipate and respond properly to changing circumstances. An organization has
to introduce change if it is to remain effective, and the employees should be
intimated with the relevance of change, the benefits, the organization and
staff stands to gain. It is in achieving the organization goals that the
individual goals are achieved. The change process can easily be assimilated if
the skill manager will be meticulous about good communication. When people are
uncertain about the change they are experiencing, poor communication allows
fear to grow and send the wrong signals. Today’s business environment requires
companies to undergo changes almost constantly if they are to remain
competitive; the power holding company of Nigeria (PHCN) has gone through
changes in order to perform better to boost industrial development. The history
of electricity development in Nigeria can be traced back to the 19th
century when the first generating power plant was installed in the city of
Lagos in 1989. Subsequently the colonial government established Electricity
Corporation of Nigeria (ECN) with ECN ordinance No.15 of 1950. In 1st
of April 1972, the Electricity Corporation of Nigeria and Niger Dam authority
were merged.
The
Federal Military Government in 1972 harmonized the power sector and called it
National Electric Power Authority (NEPA) and in 1st July, 2010, the
NEPA name changed to power holding company of Nigeria. PHCN has three unit
(Power generation, transmission and distribution. The landmark changes till
date was meant to strengthen this sector for efficiency. The sector has faced a
lot of challenges especially on the areas of energy generation, transmission
and distribution. The energy sector of Nigeria economy has be strategizing
towards better performance but often time, meet with employees resistance to
change. The public sector (power sector) of Nigeria economy faces challenges
resulting from globalization, innovation competitions and others. The need for change
that will bring efficiency and improvement in this sector has been exclusive
due to resistance and other issues.
1.2 Statement of the Problem
The
Power Holding Company of Nigeria faces a lot challenges today which includes
how to generate, transmit and distribute electricity. Epileptic power supply
has been the order of the day, plus increasing power outage which makes
domestic and industrial consumers loose confident in Power Holding Company of
Nigeria, therefore, this has led to the use of generating sets, firewood as an
alternative source of power supply with its attendant health hazard. The
government with her huge financial investment in the power sector is yet to
achieve the desire efficiency in the power generating, transmitting and
distribution. Today, the introduction of meter reading the card which is for
check and balances is not yet discernable and worst still, the privatization
policy of the federal government to strengthen the sector for improve
performance has been hampered by employees resistance to change.
1.3 Objective of the Study
The
broad objective of the study is to ascertain how change can bring employees
performance in the power Holding Company of Nigeria.
The
specific objectives of this study are;
1. To examine the
causes of employees resistance to change.
2. To ascertain if
employee participation in the change process will promote employee’s commitment
to organizational change of Power Holding Company of Nigeria.
3.
1.4 Significance of the Study.
This
work will be of immense contribution to the understanding of the concept of
change and its influence on performance of Power Holden Company of Nigeria.
It
will equally be of help to management as well as employees of PHCN to discover
the techniques and strategies required to effectively initiate change that will
gain several acceptances from employees. Furthermore, the study will also
assist organizations to have opinions of their employees before introducing any
major changes so as to build confidence of such employees on the management of
firms or organizations. Finally, the study will provide a background for future
studies.
CHAPTER TWO
REVIEW OF RELATED LITERATURE
The
chapter will present the review of some related Literature with reference to
the concept of change, theoretical framework and other issues.
2.1 Academic/Empirical Review
Change
is making things different. It also implies moving from the status quo Ile (2010), Stated that change means something
new, it means to move from one place to another. It means alteration; it is the
exchange of one thing to another. It means passing from one form, phase, place
or state to another. Change is inescapable part of social and organization life. The effect can be
studied over different time scales, from weeks to hundred of years and they can
be studied at different level, it can as well be studied in terms of its
effects at the individual group, organization, society national and
international level. Chukwuanu (2009) studied managing change in the Nigeria
work environment in selected manufacturing companies in Delta State. The
objective was to determine how manufacturing companies manage change in their
work environment. A survey of 180 respondents showed that there was significant
relation between employees involvement in planning/ implementation of change.
The paper recommends that manufacturing organization should adopt the use of
communication, employees participation and training in change management
process. Nwaogu (2011) conducted a study on change management and corporate
performance of oil servicing firms in Nigeria. A survey of 10 oil servicing company was
carried in Port Harcourt with 350 respondents that showed that effective change
and assimilation process have significant relationship with growth and
profitability, the paper recommend that employees’ welfare should be put into
consideration wherever management is handling the pressure generated from the
institution of change. Nwachukwu (2000) posits that change is inevitable in any
organization and any organization that fails to recognize the inevitability of
change is doomed to failure. Organizational change is the term used to describe
the transformation process that a company goes through in response to strategic
re-orientation, restructure, change in management, merger or acquisition or the
development of new goals and ob objectives for the company. Hendry (2004) stated
that the realignment of resources and the redeployment of capital can bring
many challenges during the transformation process and organizational change
management seeks to address this by adopting best practice standards to assist
with integration of new company vision. Machiavelli cited in Baridam (1993) stated that “there is
nothing more difficult to carry out, normore doubtful of success, nor more
dangerous to handle, than to initiate a new order of things, for the reformer
has enemies in all those who profit by old order, this lukewarness arising
partly from fear of their adversaries, who have the laws in their favour and
partly from the incredibility of mankind, Nwibere and Emecheta (2009) posited
that to desire change is easy but to initiate and implement change is
difficult. In view of this, the management of every organization increasingly
planned change to cope with the changes that revolving around technology,
social, political, economic and even the competitive environment. Robbins
(1989) Stipulates that planned change has two specific goals that it sets out
to achieve; it seeks to change employee negative perceptions about change and
it seeks to improve the ability of the organization to adapt to changes in its
environment.
2.2 Theoretical Framework
Change
theories are based on the best ways to bring new ideas to any an organization
with least resistance from employees in other to achieve improved performance.
Some of these theories are summarized as follows:
Kurt Lewin’s
Classic Three-step Model.
A
programme of planned change and improved performance developed by Kurt Lewin
involves the management of the three-phase-process of behavior modification.
Unfreezing Changing Refreezing.
Unfreezing
is the changing efforts to overcome the pressure of both individual resistance
and group conformity. It is reducing those forces, which maintain behavior in
its present form, recognition of the need to occur.
changing to a
new state is
the development of new attitudes or behaviour and the implementation of the
change.
Refreezing the
new change to make it permanents the stabilizing of a change
intervention by balancing driving and restraining forces.
John Kotter’s Change Model
Jonh
Kotter identified eight (8) steps that are useful in order to manage change
successfully. They are explained as follows;
Establish
a sense of urgency: this is to help people to see the need for change and also
convinced them of the importance, so that they can go the same direction
Creating the
guiding coalition: this
is to assemble a group with enough power to lead the change effort and encourage
the group to work as a team.
Developing a
change vision:
this is to create a vision to help direct the change effort and develop
strategies for achieving them
Communicating
the vision for buy in:
this is making sure that many understand and accept the vision and strategy.
Empowering
broad-based Action:
at this stage, the obstacle to change is removed change system or structures
that seriously undermine the vision and encourage risk taking and traditional
idea, activities and action.
Generating
short-term wins:
plans for achievement that can easily be made visible, follow-through with
those achievements and reorganize and reward employees who are involved.
Never letting up: use increase
credibility to change system, structures, and policies that don’t fit the
vision, also hire, promote and develop employees who can implement the vision
and finally reinvigorate the process with new project, themes and change
levels.
Incorporating changes
into culture:
articulate the connection between the new behaviour and organization success
and develop the means to ensure leadership development and succession
Institutionalize
new approaches: These
steps are based on a solid foundation of communication, empowerment and focus.
There should be monitoring feedback and intervention for the period after the
change has occurred so that people do not slip into old habit.
2.3 Other Issue
Forces of change
Robbinson
(1989) outlined the forces of change as follows;
The nature of workforce: Every organization
is trying to adjust to a multicultural environment there are increase in
professional and many more entrant with inadequate skill.
Technology: technology is
changing jobs and organization. Technology has brought about computer and
automation, total quality management are all the technological change.
Economic shock: the changes in
the world market like interest rate fluctuation and foreign currency
fluctuation has become one of the forces of change.
Competition: this arises
from global competition for market share mergers and acquisition, and growth of
specialty retailers are all forces of change.
Social trends: they have been
tremendous increase in college attendance delayed marriages by young people and
increase in divorce rate are also considered as forces of change.
World politics: the collapse of
the Soviet Union, US. Inversion of Iran and US terrorist are all forces of
change associated to world politics
2.3.1 How to Introduce Change
Change
is not introduced regularly; it comes when the need for change is necessary.
The following conditions are undertaken before introducing change.
Robbins
(2001) asserted that communications, change and development, empathic
consideration, employee participation, timing, changes and development should
be gradual and given positive reinforcement.
Communications: before any change and
development is undertaken, it must be communicated to all and solicit and emphasize
the need for change to employees and other stakeholders.
The Change and Development: the change
must be useful and the advantages should outweigh the disadvantages else the
inconveniences are not justified.
Empathic Consideration: management considers
the employees by listening to their complaint with sympathy as this helps to
relax anxiety which comes from uncertainty.
Employee Participation: when a manager
involves employees in planning changes, he is obtaining their commitment and
indirectly ensuring the survival or success of the planned change.
Timing: the timing of the introduction of any
change influences its success or failure. It should be introduced when people
are mentally prepared to accommodate changes example when a new executive comes
on board.
Changes should be Gradual: management
should apply gradual measures in bringing changes. The tendency of initiating
frequent changes and expect employees to adopt may not be acceptable and meets
with resistance.
Positive Reinforcement: a new process
requires special effort on the part of employees, they need strong
encouragement and special recognition which will help them to sustain their
effort during this hard time. Management will accomplish a desired change if
they recognize human limitations and try to deal with them. Every effort must
be made to relax anxiety which is characteristics of change.
2.3.2 Relationship
between change and performance.
Change
means to make or to become different, exchange or to substitute an original
thing for an entirely different one. It is any deviation from the normal situation
or event.
A
designed change in any sector will definitely improve the performance of the
organization because of new method, new technology and development and training
will be a part of the systems. To achieve this appropriate apparatus of change
process should be used get the desired result.
Planned
change represents intentional attempts to improve the operational effectiveness
of the organization that transforms to high performance. The objectives of
change efforts are to modifying the behavioural patterns of members of the
organization and to improve the ability of the organization to cope with
changes in the environment. In this regard, change and performance are directly
related.
2.3.3 Factors
that can Create High Performance in PHCN.
Several
studies has been carried out or change management and how it can effectively
bring out efficiency in an organization.
Robbins
(1989) Postulation provides better ways sectors like PHCN could be sustained
high performance. The organization needs turn-around strategy that for it to
provide adequate services that boost industrialization and economic revolution
of the country.
The
change process should be used to absorb the fear of unknown, seek for better
training and development. Programme for employees, provision of welfare package
and a well designed retirement and pension programme. The employees should be
well informed on the benefit of change to individuals and organization and also
make them to know that privatization is the only way to improve their performance
and learn new skill and acquire better condition of service. The employee
should involve in change programme to ensure their inputs are jointly
considered. This provides a feeling of belongingness.
CHAPTER THREE
DISCUSSION
In
the public sectors of the economy, the employees often resistance change due to
the fear of being short changed by the process of transformation.
The
discussion in this section will attempt to examine how the stated objectives
can be met, discussion on the reviewed literature and the limitations of the
theoretical framework.
3.1 Discussion on how stated Objectives can be met.
The
first objective would have been met, had this being an empirical research, the
paper made use of structured questionnaire that were administrated to employees
of power holding company of Nigeria in Moscow road, Diobu and Trans-Amadi
District offices in Port Harcourt. The data collected were analysed to elicit
the objective of this study. Therefore, it was observed that the causes of
employees’ resistance to change are as follows: Economic factors (Decrease in
Salary), job security (Redundancy, lay off and Retirement), Implication on
personal plan (plans, projects & family Responsibilities), previous
experience and threat to interpersonal relations among others.
The
second objective would have as well been met, had this being an empirical
research, the paper made use of questionnaire that were administered on
employees of the power holding company of Nigeria in three district, Moscow
road, Diobu, and Trans-Amadi in port Harcourt .
The
data collected were analysed to obtain the objective of the study. It was
observed that certain factors will bring our employees commitment to organizational
change. Some of this factors are communication, education and enlightenment on
the inherent advantages in the change and what they stand to gain. These will
restore confidence in the change process and as well make employees to be more
committed. The employee should be involved in the introduction/implementation of
phases of the change effort. In so doing, employees will feel a sense of belonging
as they were a part of decision making. To elicit commitment of employees to
change, organization should employ different motivational factors that are
different from the old ones to really assure them of the benefit of the new
order.
3.2 Discussion on the Reviewed Literature.
The
reviewed literatures in this study did a good work in managing change and
employee performance in organization. The researches were a stand point for
future studies.
However,
the literature reviewed did not provide for necessary ways upon which the
employees of the organization would be trained to align with the new change,
for example the Ebonyi State Government on its effort to position her employees
to technology changes, has trained their workers to be computer literate.
Organizational changes will be
beneficial on the following; improved work quality and morale, enhanced collaboration
and communication, higher retention for employees and better customer service.
The
change theories used dealt on the process to achieve organization change which
was used to draw ideas on the public sector. The John Kotter’s eight (8) steps
that need to be taken in order to manage change successfully were based on
solid foundation of communication and empowerment. It actually provides a
direction to manage successfully.
The
Kurt Lewin’s model on performance of the three-phase-process of behaviour
modification. The model agree with the work to large extent as the employees
need to know reasons why change is inevitable in organization. The process of
introducing the new change as against old order must be clear and
understandable and when actual change has been introduced, efforts should be
made to sustain the new order. The model would have been better if initial
training in the expected changes or methods are embedded to dismiss the fear of
lay-off or redundancy. The model did not give attention to human factors. Some
of the theories downplay the significance of human agency as a source of
change.
Conclusion
Series
of opportunities exist in the power sector of the economy, and if change is
effectively managed the enormous opportunities could lead to improve state of
the economy, low cost of production as a result of economies of large scale
production, job opportunities, minimization of wastage, reduction in industrial
crises and hazards.
The
power sector in Nigeria remains a life line for social, political and economic
development in Nigeria. It is an engine room to industrial development.
Therefore effort should be made to ensure it performs creditably through well
articulated managing change techniques.
Recommendations
Based on the findings and
observations of the study, the following recommendations are hereby made;
1.
The
power Holding Company of Nigeria should encourage employees participation in
the introduction of change as it would ensure successful change management in
the sector
2.
The
management of PHCN should know the specific problems facing the organization
before introducing change.
3.
The
employees’ welfare should always be put into consideration whenever management
is handling the pressure generated from the institution of change.
4.
The
PHCN management should always use communication tools as a way of keeping
employees informed to avoid resistance.
5.
Management
should create opportunities for employees to learn or be trained in new skills
required by the change effort.
6.
Management
must clearly describe to employees, exactly why the situation which existed
prior to change is no longer acceptable.
7. Finally, in
initiating change PHCN should always asses its strength, weakness,
opportunities and threat (SWOT) and use a criteria for designing her entire
system of change process and activities.
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