Introduction of Unilever Company.

Markets never remain static and unchanged. Over time customers choices and interest get changes. Companies work for the customer. Therefore, they also make changes in their product lines to meet the new requirements and demands of the targeted customers. Somehow, change is not limited to product lines only. Organizations also have to change with improvement in technology and communication system. Advanced researches also come up with attraction of decrease in cost-related strategies that companies implement to earn huge profit margin. Thus, in short, changes are essential for the companies particularly for survival in a dynamic and competitive environment. Present work is related to the analysis of a case study centered upon the idea of change management in Unilever Company. Present work will discuss the situation of Unilever in the targeted market along with detail about the need for change in the organizational operations.       

Overview of Unilever Company

Unilever is the world-famous consumer product manufacturing company. Unilever started its operations in 1930 with the support of its founder Lever Brothers and Margarine. In the beginning, the product line was limited to some janitorial and cleaning products. Later on, the company introduces new products to enrich the existing product portfolio. In the beginning, the company was working collaboratively with owners from the UK and Netherland. However, now the company is consisting of two separate legal entities known as Unilever PLC (in the UK) and Unilever NV (in the Netherland) which operate as a single economic entity.

Key products of Unilever are divided into four main categories which are Refreshments (e.g. tea and ice creams), Food (e.g. Juices and Snacks), Homecare (e.g. washing powder and dishwashing soaps), and Personal Care (e.g. shampoo, soaps, and conditioners). Several brands are working successfully in local and international markets under the supervision of Unilever Company. Some of these brands can be distinguished as Knorr, Dove, Omo, Axe, Cif, Lipton, Magnum, and Blue Band.          

Analysis and Evaluation of Situation of Unilever Company

According to the case study, Unilever was working successfully in the targeted market as reputation was improving but still profit margin was not stable. Significant economic headwinds and weak markets were projecting a need for Unilever management to come up with the best course of actions and strategies to deal with the developing markets. In 2009, currency changes caused several changes in the operations and outcomes of the Unilever group. According to the views of Polman (new CEO of Unilever group since 2009), Unilever market was flat in 2014 for the first time and company faced decline in the sales growth from 3.5% to 2.5% in one year duration (from 2013 to 2014). Changes in the emerging market trends and demand fluctuation caused a challenging situation for Unilever to improve and maintain its progress in the market without facing negative influence from the economic pressure.

Financial data from 2005 to onward project the financial condition of Unilever Company in response to the changes occurred in the operating market and operational strategies of the company. According to the analysis of the company, the turnover rate in the company is increased rather than decreasing. While on the other hand, the profit margin of the company and overall net income are facing decline more than increase or growth over this period. Somehow, the company was not facing a decline in the sales and net profit in all targeted markets. Subjective analysis of the company's performance from 2008 to 2015 indicate that the company's reputation was improving over time as in 2015 company was ranked as 36^th best global company in the list of Fortune.

Need for Change in Unilever Company

Although the decrease in the profit was a factor of attention for corporate management as they need to bring changes in the business level strategy to improve the company's performance in the competitive market. Considering this situation board of director decided to change Chief Executive Officer (CEO) of the company. New CEO conducted research on the business operations and strategy of the company with the purpose to identify the areas of improvement. During the first few months, CEO introduced some reforms related to the identified weaknesses. But still, there was a need for more innovation and improvement to enlarge organizational capabilities and strengths. Even the turnover rate was controlled in the company but still, new initiatives were required to ensure growth in the profitability and sales of the company in a fiscal year.

According to the views of the new CEO, Polman company need to close the gap with better performing competitors in the sector of fast-moving consumer goods. Moreover, he also emphasized that the company also need to bring changes in the leading position by considering the competitor's corporate structure benchmarks. Unilever culture was not fully innovative and creative as a rigid and fixed hierarchy of control was the key reason for the decrease in performance efficiency of employees. Considering this he raised the point that Unilever needs to bring changes in the four main areas which are organizational structure, personnel, strategy, and organizational culture.           

Impact on culture and effectiveness of the Leadership Styles and Techniques of Unilever Company

Changes made in the organizational structure and organizational culture result in the changes in leadership styles and workplace culture in the organization. Now in the new strategy main focus was on sustainable living rather than business profitability only. Unilever business model had central value for people, brand, and operations. Sustainable brands and sustainable operations were considered as the key reason for success in the future. Furthermore, the business model was also related to profitable volume growth, innovation, and marketing investment, and cost leverage plus efficiency. Focus on innovation and creativity changed the overall behavior of the workforce in Unilever.

The change caused to improve the effectiveness of leadership styles and techniques as it supports to increase the role of managers in the decision-making process. Additionally, managers under the new system were capable to collect the right information about local circumstances which reduces the chances of the wrong decision. Other this leadership style was more centralized and reduce in decentralization increase the performance outcomes in each segment. Changes made in the culture influenced the behavior of employees. The key focus of change in culture was on two areas which are performance target setting and remuneration.

Corporate management took the responsibility to set targets for the organization and departmental performance. Because of this change employee performance was improved as they were struggling to achieve targets. The principles of remuneration system were related to the paying for performance, prevention of inappropriate risk-taking, and alignment with shareholders interest. In response to these changes employees of the company and managerial staff at the different level presented improvement in the performance outcomes as they were not taking the inappropriate risk and all business operations were aligned with the shareholder's interest.

Change Success Matrix of Unilever Company

According to the concept of leadership and management, the key roles of the top management in leading strategic change are envisioning, aligning, and embodying. The strategic change implemented in organizational leadership was addressing all these roles. Under the new system leaders were aligning the organization to deliver that strategy. Moreover, they were embodying change at each level of the organization from production to the delivery of goods to the targeted customers. Considering this it can be said that change was successful for the company as it improved the leadership style and organizational performance.

According to the information presented in the “exploring strategy” book which is written by the Johnson, Whittington, Scholes, Angwin, and Regner conclude that middle managers also have a role in the implementation of strategic change. Middle managers play the role of advisers and they align change at the local level. Case study analysis present that middle management was involved in the changes made at the local level also as they were not only capable to align with organizational targets but also to collect information from the local market regarding the preferences of customers. In other words, after the implementation of change middle management of the company was also capable to work on his/her delegated roles by strategic change (Johnson, Whittington, Scholes, Angwin, & Regnér, 2017).   

According to the information presented by Thompson, Peteraf, Strickland, & Gamble in a book “Crafting and Executing Strategy” (2017), the key features of the corporate culture are values, ethical standards, positive treatment of stakeholders, and management practices. Evaluating these feature after the implementation of changes in the culture of Unilever Company we can conclude that Unilever ethical standards were improved and the company started paying more attention to the interest of shareholders. Sustainability in the economic market and financial growth are also evidence of the company’s success after the implementation of change in the key areas.       (Thompson, Peteraf, Strickland, & Gamble, 2017)

Improvement in the Implementation of Strategy of Unilever Company

The current change management system of Unilever was highly effective as it delivered the desired outcomes somehow still more improvement could be made in some areas. Particularly, while implementing change strategy some initiatives could be taken by the company for the improved and better implementation of the strategy. According to the research findings presented by Aladwani in 2001 corporate management of the company should also ensure training and development sessions in the company to support the managerial staff and other relevant staff in understanding the new system and strategy.

Researchers also conclude that effective management of resources is essential for the appropriate strategic change implementation (Aladwani, 2001). Another research study conducted by the Bordia, Hobman, Jones, Gallois, and Callan in 2004 elaborate on the factor of uncertainty in change management. According to the research findings, managerial staff needs to take into consideration all possible uncertainties and risk factors while implementing change strategies in the organization. The organization needs to analyze and monitor risk factors relating to resource management, operations management, and supply chain management to prevent negative consequences (Bordia, Hobman, Jones, Gallois, & Callan, 2004). Considering the research findings it can be suggested that Unilever management should take these initiatives while implementing the strategy.

1)      Unilever management needs to take the initiative of conducting market research before implementing change in the company. They need to study how other competitor organizations had implemented change in the past and what are the outcomes of their change management system. After analyzing outcomes in detail corporate management should plan for new strategic change in Unilever.

2)      According to my opinion, Unilever management could improve strategic change outcomes by analyzing the consequences of change in advance. Thus, keeping in mind, the possible outcomes of each step they could improve implementation of the strategy.            

Leadership Styles of Unilever Company

Leadership styles are usually adopted in the companies following the business operations and requirements of managerial duties in the company. Moreover, the market situation of the company also draws influence on the selection of leadership style for a company. In the markets where competition is high and substitutes are easily available to the customer, companies are required to have an innovative and creative culture. Only innovation and quality can support a company to stand against competitive power.

Thus, companies working in this situation usually prefer to have flexible organizational control and transformational leadership styles. Flexibility can encourage creativity and innovation. While on the other hand, companies have fixed processes and organizational operations usually prefer to have a rigid and static hierarchy of control. Thus, leadership styles in these organizations are usually autocratic.             

Conclusion on Unilever Company

The whole discussion concludes that Unilever Groups is operating with a wide product portfolio in various areas of the world. Company is continuously increasing its products range and expanding geographically. Improvement in the reputation of the company is supporting the company to secure a better position in the competitive market but still, some factors are causing to reduce profitability and sales growth. In the past, the company faced several time ups and downs in the targeted market. Turnover rate was increased and profitability declined as sales decreased continuously because of changes in the customer trends, demand instability, and availability of competitor's products. Considering the changing condition of organizational performance directors decided to change chief executive officer of the company. New CEO introduced several changes and reforms in the company which later resulted in the positive outcomes of the organization. The company introduced changes in the culture, organizational structure, people, and strategy.