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Managing Change Process


The change process of how Lufthansa managed was evaluated with Pettigrew framework.  Pettigrew (1987) distinguished three aspects to analyse change which were context (about why), content (about what) and process (about how) that had to be fitted each other to be effective.  The process of change concerned how the change was being managed so it was very important to avoid resistance.  There were four ways in which the process of change could be managed: coercive, directive, consultative and collaborative. 

Lufthansa adopted a consultative change process because the initiative was top management-driven by Weber; while he also recognised that employees needed to be consulted about the process.  In fact, Weber took a further step to consider the influences of the stakeholders.  He knew power would be one of the obstacles so he had to work within a constitutional order (Barnard, 1938).  Therefore, he used stakeholder analysis and engagement in order to anticipate problems in advance and develop possible solutions (Nadler, 1998).  So in the whole process, Weber did well and prepared to tailor his perceptions to accept any other aspects of the proposal, or possible negative response.  For example, he intentionally did not insist on immediate implementation of the remaining change plan to avoid risking the consensus with the unions.  The absence of strikes and a high level of consensus between management and other stakeholders, in particular the labour unions, was a remarkable feature of the Lufthansa crisis management. 

The consultation included senior management to describe to employees the plan which they wished to follow.  The most important areas were how to convince employees to accept the downsizing of the fleet and reduction of staffs.  Open communication was the major technique in the change process.  For example, Seeheim crisis management meeting was one of the first experiences with interdepartmental co-operation and non-bureaucratic problem solving to enhance open communications in Lufthansa.  It was done well as it could reduce resistance by explaining the situation in what Nadler (1998) described as .large group engagement processes・ at a time which is favourable to management.  It could also avoid risking conflict erupts in a piecemeal and uncertain way to the eyes of employees.

Effective use of communication could get the message over about the key aspects of the change process (Nadler, 1998).  Although this kind of consultation generally slowed down the speed of change, it could increase the awareness of the change process and its objectives by giving employees a higher degree of knowledge.  It was also important to gain employees・ support and full commitment to the success of the change process.  This was highly effective in the case as the employees in Lufthansa knew the whole picture through common goals.  For example, after the meetings the majority of senior managers within the company were convinced of the necessity for drastic change and committed to a set of extremely ambitious goals.  In order to survive, the employees could even discuss issues such as staff reduction and productivity increase openly and personally.  

Leadership behaviour was used to achieve .hard success through soft processes・.  Weber・s participative leadership style won employees by his open and authentic communication.  He also used in-dept individual interventions (Nadler, 1998) with the change process, and was accompanied by various visible actions such as the Executive Board・s waiver of annual salaries in 1992.  Although the negotiation on the plan itself was marginal and limited, Weber did very well and was able to influence his followers using his leadership behaviour.  Therefore, employees were taken by his leadership emotionally and willing to go the way Weber pointed them. 

Weber also understood to use accountability to give executives responsibility, the necessary coaching, monitor how they are doing, and give them lots of feedback (Nadler, 1998).  This could help to facilitate the change process.  Line managers took responsibility for the change process in order to realise the unavoidable cuts and to motivate the remaining employees.  It was done well because nobody complained.  On the contrary, employees accepted the challenge and really gave their best.  They could even motivate themselves through internal competition for best change results, for example how to win over other managers and employees for the stretching goals and activities.  Continuous feedback was also used to ensure consensus that led to goal achievement.

There were other things done well in the change process through the interventions suggested by Nadler (1998) such as measurement and gap analysis for monitoring progress and results about personnel and non-personnel cost-cutting and the enhancement of revenues (redevelopment controlling); education as a means to turn the change message into coherent and implementation to support business and strategic objectives that was difficult to imitate (Lufthansa School of Business); structural change to independent small units which fit into the accountability goals (federative groups).

Based on the above discussions, the overall performance of how Lufthansa managed the change process was very well done.  However, the internalisation and branding of the Lufthansa subsidiaries was done poorly.  There were several problems.  Except growth strategies of the Lufthansa companies varied, there were also differences in the degrees of internalisation and relationships to the brand .Lufthansa・ due to a need for international and local integration.  This would hurt the co-ordination of the subsidiaries and ultimately hurt the image of the company.

This could be done differently for better results.  The top management should intervene to create collaborative culture definition (Nadler, 1998).  This is to involve subsidiaries together to consider the new environment they are facing, and what skills and behaviours are required and how to develop a set of values and a vision to suit this new environment.  For example, the top management should set the boundary (a set of overall corporate strategic issues) so that the subsidiaries can follow and not go so far away.  A high demand of co-ordination among subsidiaries is necessary to remain the relationship and internalisation of the company.  That is, management process redesign is crucial for key aspects of the control and co-ordination of organisations such as goal-setting, budgeting and measurements in order to be consistent (Nadler, 1998).  Finally, a global brand should still use to represent the image of Lufthansa.  By doing so, the company can be benefited from the brand awareness and consistent value from the global competition.


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