EFFECTS OF CHANGE MANAGEMENT ON ORGANIZATIONAL PERFORMANCE IN THE TELECOMMUNICATION INDUSTRY (A CASE STUDY OF MTN NIGERIA)
The rate of competition in the telecommunication industry in Nigeria is moving at a leap frog basis due to changes in technology, product and services, customer taste among others. This has made change management experts to emphasize on the importance of establishing organizations readiness for change and have crafted various strategies for creating it because successful management of change is crucial to any organization to survive in the present highly competitive and continuously evolving business environment. Change management is a planned loom for the transition of individuals, groups and organizations from existing state to a required future state. Thus, managing a change process is as important as change itself. This study therefore examines empirically change management and its effects on organizational performance in Nigerian telecommunication industries. In conducting this study, a total of 210 staffs of MTN were randomly selected from a staff population of 460 in Ilorin. Four hypotheses were advanced to guide the study and data collected for the study were analyzed using regression Analysis and one-sample t-test. The result revealed that changes in technology has a significant effect on performance at 5% level of significant and it follows that there is a significant effect of specific change models/techniques on organizational performance (P-value=0.000<0.05)other findings reveals that there are no significant effects of change management implementation on organizational performance (P-value=0.000<0.05)and that there exists lack of Communication, Poor Support from Company management, High delay tactics, Technical problems and lack of Resource & Planning as being the major obstacles that hinders the realization of the effective management of change in MTN Mobile telecommunication industry at 5% level of significant. Based on the findings of this study, recommendations were made that telecoms industries in Nigeria should be pro-active to changes in such a competitive environment so as to experience smooth implementation of such changes. The study therefore concludes that nothing remain still in the world of business as change is the only thing that is constant. Change managers should therefore successfully manage the human side of change in order to avoid resistance to change using the appropriate change strategies, thus, enhancing overall performance of the industry.
TABLE OF CONTENTS
Title Page i
Table of Contents vii-viii
CHAPTER ONE: INTRODUCTION pages
1.1 Background of the Study 1-7
1.2 Statements of the Problem 7-8
1.3 Research objectives 8-9
1.4 Research questions 9
1.5 Research hypothesis 9
1.6 Significance of the study 10
1.7 Scope of the study 11
1.8 Limitations of the study 12
1.9 Plan of the study 12-13
1.10 Operationalization 13
1.11 Operational Definition of terms 14
CHAPTER TWO: LITERATURE REVIEW
2.0 Introduction 15
2.1 Conceptual clarification 15-18
2.2 Theoretical foundation of the study 18-23
2.2.1 Theoretical reviews 23-26
2.2.2 Types of change and change management 26-27
2.2.3 Level of change management 27-28
2.2.4 Importance of managing change 28-29
2.2.5 The catalyst of change process 29-30
2.2.6 Managing change 31-32
2.2.7 Change management practices 32-36
2.2.8 Challenges of managing change 36-40
2.2.9 Resistance and causes of resistance to change 40-43
2.2.10 Change and its impact on organizations 43
2.2.11 Change management models and frameworks 43-48
2.3 Empirical evidence of the study 48-55
2.4 Research gap 55-56
CHAPTER THREE: METHODOLOGY
3.1 Introduction 57
3.2 Research design 57-58
3.3 Research instrument 58-59
3.4 The study area 59-60
3.5 Population of the study 60
3.6 Sampling techniques 60
3.7 Sample size determination 60-62
3.8 Data collection 62
3.9 Method of data analysis 62-63
3.10 Pilot reliability test 63-64
3.11 Ethical considerations 64-65
3.12 Research philosophy 65
CHAPTER FOUR: DATA PRESENTATION AND ANALYSIS
4.1 Data analysis and interpretation 66-69
4.2 Testing of Hypothesis 70-81
4.3 Discussion of findings 81-83
CHAPTER FIVE: SUMMARY, CONCLUSION AND RECOMMENDATION
5.1 Summary of findings 84-86
5.2 Conclusion 86-87
5.3 Recommendations 87-88
Appendix I: Introduction Letter94
Appendix II: Questionnaire95-98
1.1 Background of the Study
Organizational performance is a fundamental variable for telecommunication industry in achieving its objectives and goals. Employees are an important asset to an organization that may affect it either positively or negatively. Due to unavoidable environmental changes, organizations today have been challenged to advocate for changes that influence Organizational performance. Therefore the top management has to ensure that factors that influence employees ‘performance are taken into consideration. Management can be defined as a creative and systematic flow of knowledge that can be applied to achieve quality results by using human as well as other resources in an effective way (Drucker, 2003).
The importance of management in organizations today has increased multifold. Strategic outcomes depend on ways of management in organization, therefore key management functions that include learning to delegate, planning, organizing, communicating clearly, motivating employees, adapting to change and constantly generating innovative ideas are crucial. Change is unavoidable in organizations today and is of paramount importance to study how change factors affect organizational performance. Change is what presses us out of our comfort zone and it is inevitable (Sidikova, 2011). Kitur (2015) is of the view that change comes in an organization in many forms: merger, acquisition, joint venture, new leadership, technology implementation, organizational restructuring, and change in products or regulatory compliance. The change may be planned years in advance or may be forced upon an organization because of a shift in the environment. Organizational change can be radical and alter the way an organization operates, or it may be incremental and slowly change the way things are done. Change management can be defined as a style of management that aims at encouraging organizations and individuals to deal effectively with the changes taking place in their work. (Green, 2007).
For change management to be successful and its impact positive, managers or supervisors in the organizations need to understand what motivates their team and enroll employee participation. In fact separating managers from leadership in terms of style is difficult because every manager needs to have leadership skills to get activities done and every leader should have managerial skills to induce workers to change directions. This is especially important in organizations or institutions which are going through change since constant motivation and guidelines are needed for effectiveness of employee performance (McLagan, 2002).
The Nigerians Global System for Mobile Telecommunications (GSM) and Information Technology sector is fast growing and it is characterized by dynamic changes. Telecommunication industries witness dramatic changes at all levels (Tsekoa, 2002; Garber, 2013). There are many drivers for change in the telecommunication sector; caused by technological advancement, fierce competition that has risen drastically in the last years, and the need to develop new services in the telecommunication sector (Hodges, 1995). Telecommunication organizations need razor-sharp reflexes to cope with the fast changing technologies and management skills. Therefore, change management is a vital tool to be adopted by the telecommunication sector to maintain development and growth (Kanter 1991; Tsekoa 200
In the year 1990, there were only 11 million subscribers worldwide, but the introduction of digital services in the early 1990s, combined with competitive service provision and a shift to prepaid billing, spurred rapid growth in demand. However, Nigeria has not been left out of this race for rapid change and development in telecommunication industries, although the journey to success in the milieu had been long and tortuous because the industry failed to realize the importance of adopting strategic Change Management practices concern with how well changes are managed in organizations so as to achieve competitive advantage through the strategic creation of a highly committed and capable workforce.
The development of telecommunications facilities in Nigeria began in 1886 when a cable connection was established between Lagos and London by the colonial administration (Adegboyega, 2008). However, as the European mercantile activities gained foothold in the country, the first commercial trunk telephone service was established to link International Telephone Unit (ITU) and Calabar in 1923. In those early days, services were primitive and the coordinated pegboard switching system was used. The rapid change and transformation from primitive technology to a more advanced global switch system that was today lead to the invention of GSM was a result of change management practice adopted by the telecommunication industries to create enabling environment for the structural and technological change in the system.
The Nigeria’s telecom sector witnessed a major transformation and change initiative in 2001 with the granting of the global system for mobile telecommunication (GSM) license to providers. With the advent of mobile telecommunication (GSM) that has resulted in a dramatic change in the total number of lines from 866,782 in 1999, to over 60 million lines, in year 2008 out of which GSM operators accounted for 57, 622, 901 lines, fixed line operators accounted for 2,537,504 code division multiple access, CDMA, operators connected 780,938 lines (Ndukwe, 2008). This recent drive in telecom reform and change initiatives has made noticeable impacts on Nigeria. It is therefore imperative to investigate the extent and the magnitude of the impacts of change management on employment, investment, income, transaction cost and most especially the growth and performance of the sector during structural and technological changes. It is however noted that as organizational changes become more frequent and a necessity for survival, the resistance of employees in this sector has become an important human resources management function and a priority for top management to increase chances of success of different change projects (Tang and Gao, 2012). However, managing employees’ resistance during organizational change requires an effective type of change management processes (Jansson, 2013). In particular, communications from the right entity in the organization help improve the employees’ response to organizational change (Kotter and Schilesinger, 2008). O’Neill (2012) explained that management practices related to organizational change must be clear, consistent and based on what is in the change for the individuals to improve their perception, and ultimately, improve their cognitive appraisal about the change. In other words, without appropriate body in the organization to communicate with employees, organizational inappropriate practices may even increase resistance of employees (Tang and Gao, 2012).
Furthermore, Minerich(2008) stated that creating awareness and reasons for change must be clear and simple and that communicating these reasons must be realistic and linked to the vision in the company in order for employees to buy-in. With this in mind, there seems to be lack of change management frameworks that help telecommunication companies choose the most appropriate course of action to navigate successfully during change process. Telecommunication industries should see change as a major issue in their quests for survival, growth and development. The Nigeria Telecommunication Industries is one of such companies. The executives of this company ought to constantly take initiatives that keep the company’s activities abreast with the dynamic nature of the sector. This suggestion is found on the notion that the success of any company is significantly dependent on its ability to align its internal activities to the specifics of its external environment. In view of this realization and given the fact that the Nigeria telecommunications and information technology sector is constantly changing, the need for NITEL to transform in line with the environment becomes imperative. It is stressed however, that it is one thing for an organization to recognize the need for change and it is another situation for the change to be effectively managed. This assertion is hinged on the fact that there is tendency for a well proposed change to impact negatively on overall organization’s performance if such change is improperly managed (Thomas, 2014). Change requires passing through a transitional phase. It is a transformational experience that could be incremental or radical for companies seeking improvements and competitiveness. Several companies have failed to transform in spite of changes in their business environments. These organizations are satisfied with the status quo, they maintain organizational activities the way they are. Although academics and practitioners overtly recommend organizational change for effective alignment with a changing business environment, most companies attempting this transformation often encounter resistance to change in the way company’s activities are carried out. This resistance is conceived to be a problematic factor that impedes overall growth of a company. By and large, resistance t o change should be eliminated and acceptance to change encouraged (Jones and Smith, 2004). Employees have high propensity to resist change when the change is unexpected, sudden, or radical in their view (Gibson and Hodgetts, 2013).
NSince change generally involves the reordering of priorities and the disruption of established relationships, such change tends to be controversial both internally and externally. Buchanan and Boddy (2009) asserts that to remain competitive, modern organizations should aim at uniqueness and superiority in all spheres of their operations, technology, work procedures, goods and services, approaches in the various management functions of planning, organizations, staffing, directing and controlling. These changes are only possible through creative and innovative thinking. It is therefore important to find out how organizations in the telecommunication industry are managing change as the sector is highly dynamic.
Change is inevitable in telecommunication organizations. Political instabilities, technology advancements, change in customer tastes, globalization, and cultural changes are among the factors constantly forcing telecommunication organizations to change. Leaders in this sector realize the importance of change management in the change process. However, there seems to be lack of managerial frameworks that help telecommunication companies implement effective change management practices. This paper shall present a managerial framework for the implementation of change management in telecommunication sector and provide solution to some of the challenges that impede their growth and performance during the change process. The framework will be constructed using empirical findings from four case studies of Nigerians telecommunication companies.
1.2 Statements for the Problems
The Nigerian telecommunication industry is fast growing in the country and this is continuously necessitating dynamic changes in organizational activities relating structuring customer handling and product portfolio. The problem in the most organizations are not able to adjust to the dynamic changes happening in the economy which invariably affecting their performance. The managers of these firms in this industry are continually on each other’s toes trying to outwit others by devising new strategies which charges and at the same time minimized the cost of change implementation. Going by the number of participating firms in the industry as at year 2001 when the sector was deregulated and the few existing ones by now, one could not but be baffled. The conclusion one can easily draw is that many of these firms that have gone under not effectively managed the change that occurred in the industry which eventually swept them off.
Another major problem is that the poor survival rate indicates a fundamental lack of a valid frame work of how to implement and manage organizational change. This indicates that there is much to change management that needs to be learnt. It is on the basis of unassuming changes in the telecommunication industry that this study is carried out to unveil the hidden facts of how technological change is affecting this industry. When change is not properly managed, there is the tendency it affects performance negatively which may result in total closure of the organization as it happens to many of the firms in the industry, or loss of valued employees or failure to meet financial objectives of shareholders and may eventually degenerate into customers dissatisfaction who could easily move to other competitors thereby affecting the overall performance of the firm.
1.3 Research Objectives
The main objective of this study is to examine the effects of change management on organizational performance in the telecommunication industry. In line with the main objective, the specific objectives are to:
⦁ Appraise the extent to which increasing technological changes affect organizational performance of telecommunication industry in Nigeria.
⦁ Examine the effect of specific change models/techniques on organizational performance.
⦁ Examine the effect of change implementation on organizational performance of telecommunication industry in Nigeria.
⦁ Examine the factors that have facilitated or hindered effective management of change in MTN Nigeria.
1.4 Research Questions:
The study is poised towards providing answers to the following research questions:
⦁ To what extent has an increasing technological change affect organizational performance of telecommunication industries in Nigeria?
⦁ What are the effects of specific change models/techniques on organizational performance?
⦁ What are the impacts of change implementation on organizational performance of telecommunication industries in Nigeria?
⦁ What are the specific hurdles that hinder the realization of the effective implementation of Change in the telecommunication industries in Nigeria?
1.5 Research Hypotheses:
The following Null Hypotheses are tested and advanced in the course of this study.
Ho: Change in technology does not have any significant effect on organizational performance
Ho: There is no significant effect effects of specific change models/techniques on organizational performance
Ho: There are no significant effects of change management implementation on organizational performance.
Ho: There are no significant hurdles that hindered effective management change in MTN Mobile telecommunication industry in Nigeria.
1.6 Significance of the Study
The study may act as a guide on how Mobile TELECOM industries should manage change in their day-to-day business transaction. Telecommunication industries in Nigeria have always had a policy programmes for managing change and initiative, but most of the programmes have failed to achieve sustainable growth in the TELECOM sub-sector. Most of the government assisted-programmes have themselves become failures. The findings of this study is expected to inform policy makers and assist the management on how to go about implementing strategic change without compromising on workforce quality.
The study findings may be of great significance to the management in the telecommunication industry as they may fully understand the effects of change management on the organizational performance. The study may be valuable to the managers in coming up with policies in change management and practices. It may give up to date information on the change management practices that have been adopted by players in the telecommunication industry and propose improvements to each of the practice. In other word, the study will be important to the telecommunication sector as a whole as it will not only highlight strategic change management practices adopted at the industry but also identify how the change management practices have impacted their performance. This will be of importance not only to telecommunication industry but also to other players in the industry as it will enable them come up with viable policies and practices to strengthen their change management practices adopted in the sector so as to promote efficiency and competitiveness.
The study will also be of beneficial to the sector regulatory authorities as information generated by this study will give more insight into change management issues and challenges affecting the telecommunication sector in Kwara State and Nigeria at Large. The study will provide the regulator with information on challenges experienced in undertaking change management in telecommunication industries in Kwara State and how to work around the challenges experienced. The study findings may be of great importance to the researchers, as it may contribute to both theoretical and practical knowledge on the effect of managing change in the TELECOM industry. Scholars may find it important as it may increase the body of knowledge in this area.
It may also assist the researchers in doing further studies on the same. It is hoped that the knowledge gained from the study may serve as a basis for planning and a point of reference for further studies in the field of change management.
1.7 Scope of the study
The study provides insight into change management strategies and business growth of the one of the leading giants (MTN) in the Mobile TELECOM industries, as well as provides a measure of the effects of managing change on their organization performance in the sector. It covers the selected TELECOM industry (MTN) in Kwara State Ilorin and the quest for managing change during the last five years. The population for the study includes the Managers and employees of the selected Mobile telecommunication company in Kwara State that have obtained their final operating licenses in the last five years.
1.8 Limitations of the study
The main limitation of the study is the reliance on information supplied by the four TELECOM operators who normally do not want to make a full disclosure of their businesses to an unknown person for fear of being subjected to tax payment. The oath of secrecy between the Management and its employees is another area of constraint in this study. Factors such as economic environment, political instability and government policy on GSM operators are considered to have strong effects on performance but are not readily available and so constitute a constraint to the study. However, we rely on information from consumers as well as scientific methods to obtain the data and the analysis shall be based on superior analytical techniques, which we believe allow us to generalize our findings.
1.9 Plan of the study
Chapter one of this research works has to do with the introductory part of the study, which provides a summary of the subject matter. It contains a brief background of the study, statement of the problem, the objectives of the study, research questions, research hypothesis, and significance of the study, scope and limitations of the study, definitions of related concept and organization of the study.
Chapter two is on the review of related literature. The chapter reviewed the concept of managing change in an organization, types of change in TELECOM industries in Kwara State, organizational change and performance, change and employees, implementing change and motivation, and the empirical evidence of the study.
Chapter three examines the research methods and procedures. It has two parts, selection of data and process of data collection, sources of data collection and method of data analysis.
Chapter four consists of main findings of the study through research data analysis, presentation and interpretation.
Finally, chapter five has to do with the summary, conclusion and recommendations of the research work.
This project topic has two constructs, change management and organizational performance with which the formal variables are technological changes, economic variation, environmental reference, labour flexibility. The later can be identify as profitability, efficiency, effectiveness and growth.
X = F(y)
Profitability Technological change
Efficiency Economic variation
1.11 Operational Definition of terms.
Organization: Organization system or body of people united for a purpose. In another sense, it includes the behavior of participant. In another sense it can be referred to as the enterprises itself. Being an enterprise, it is a social or human grouping deliberately constructed and reconstructed to accomplish specific goal.
Management: it can be defined as the art of getting things done through the effort of other people.
Planning: This deciding what goals are, how these goals can be accomplished to produce a desire result
Change: this means to alter, and change from former state to new state of situation as a result of innovation. It may be new product, new materials, new discovery, and new regulations.
Respondents: persons qualified to be interviewed to supply answers to questionnaires.
Policy: it is a plan employed by organizational to guide their thinking and action towards organizational objectives.
Performance: is the measurement of employee’s performance in line organization target.
Control: verifying whether everything occurs in conformity with the plan adopted, the instruction issued, and principles established.
Challenges: are the identified problems in the course of managing change and its effect on the overall business growth..