Implementing_a_Leadership_Change

Running head: IMPLEMENTING A LEADERSHIP CHANGE Implementing a Leadership Change for Gene One University of Phoenix LDR 531 Introduction and backgroud situation This paper concerns the week five Gene One case study assuming that the CEO Don Ruiz suddenly died. It will also analyze the current leadership styles and structures, it will introduce leadership changes neccessary to accomplish a successful initial public offering (IPO). Gene One is an eight year old company in the biotechnology area that increased its revenue from two to $400 million per year. They attribute their success to gene technologies which help farmers to produce vegetables without using chemicals. The board of Gene One decided to go public in order to gain more capital and to remain competitive and succesfull. Current Leadership Analysis The following analysis describes the strengths and weaknesses of the current board members. It based on the Team B week five analysis (Learning Team B, 2010). Michelle Houghton, CFO - participative leader - strong sense of ownership and emotional attachment to Gene One - cautious and problem solving attitude - logical and strategic - concerned about the timing of IPO registration - releasing financial statements to public too early while not finalized - concerned that investors are cautious in biotech industry because of the human genome sequencing scandal Charles Jones, Marketing Officer - participative leadership - known for his calculated risk taking - connections in biotech industry - self-confident and moral - he thinks in big pictures and does not focus on details Greg Thoman, HR - people-oriented leadership behavior - dynamic and very productive - more concentrated on existing problems instead of developing future strategies - did not have time to recruit new talents or create a corporate culture for future business growth - checks effect on organizational culture before taking any action - wants a strong communication process with employees Teri Robertson, CTO - task-oriented and people-oriented balanced leadership behavior - very talented and extremely committed to Gene One - named as CTO of the year and has prestigious reputation in biotech industry Neccesary changes The board and the Mr. Ruiz’s heirs have to choose a new Chief Executive Officer (CEO). Basicly they may select an external individual who has not worked for Gene One or one of the current board members. This is neccessary before taking other decisions. The next step is to make sure that the new CEO is familiar with all the issues vital for leading Gene One. Thereafter the board with the new CEO should determine if Gene One will continue with the IPO process, and if so, under which circumtances. The final step is to establish a strategy change in order to keep the company competitive and to ensure a successful IPO. An new CEO from outside has to receive enormous support from the Board in obtaining all information about Gene One’s situation, personell, products and about the biotech industry, if neccesary. In this case the already agreed three year Executive Summary could be jeopardized, because the focus will be on the new CEO and maintaining Gene One’s good market position in the short run. Based on the described difficulties the Ruiz family with support and approval of the Board, have chosen Charles Jones to take over the CEO position. Charles has cultivated many connections within the biotech industry while in the marketing officer position. He is a visionary and has worked to create the brand image that has brought Gene One to the level of success the company is currently experiencing. In order to maintain a seamless transition, the Ruiz family opted to hire Lucas Antonio to fill the marketing officer position, based on the recommendation from John Kirby. As Charles steps into the CEO position, he will need to adapt his leadership style to the current situation within the organization. Charles may take a participative leadership role with his executive team by listening to their suggestions and opinions and taking a consultative approach. With other members of the management team and employees, Charles may take a supportive leadership role by displaying concern and consideration for employee wellbeing. Change strategy All the Board members have agreed on goals and visions, developed and introduced by the late Don Ruiz, (Gene One Scenario, 2009) and also on going public. Charles Jones and the new Board have to review the Executive Summary and address each Board member’s concern such as timing and gaining satisfactory insight into the IPO plan. It is important that everyone on the senior leadership team support the CEO and the decision of going public, furthermore the IPO plan has to be modified, to exclude Board doubts. Another change strategy is about applying the transformational leadership style and communicating with employees and the public through easy and open communication. New Organizational Structure Gene One’s organizational culture has not grown as fast as its products and profit. Gene One is facing the demand of a new organizational structure adapted to their new direction of going public and initiating IPO within a very short period and achievement high goals. Organizational structure is defined by attitudes and behaviors through formal distribution of jobs and tasks, grouping and coordination (Robbins & Judge, 2007). The Gene One’s Executive Board has decided to restructure the executive leadership, required by the fact that a new CEO had to be chosen and a new Marketing Officer was needed. Teri Robertson, highly dedicated and talented researcher, could continue to shine out with her position of CTO, she can probably investigate more in finding new technologies and developing new products. She can create her own team with new talents and lead them with inspiring and coaching abilities to bring Gene One closer to the end-state vision. In order to comply with the SOA requirements in IPO Board composition, Gene One has to hire at least one member with financial experience as CPA or CFO. Also external auditors are needed since the IPO Board require one member to represent auditing, a competence lacking in the present Board. Implementing transformational leadership style Gene One’s former leader was charismatic, he had a clear vision and ability to sacrifice himself to reach his created vision. However, a successful vision must be credible and appealing. It also requires inspiration and strong belief in that vision to make followers passionate and committed to the end-state vision of the company. Gene One’s best choice for a leadership style and structure is to use its current staff and a more democratic leadership style (Learning Team B, 2010). A transformational leader must demonstrate a continuous commitment to change and empower his senior leadership team and employees to implement this change (Yukl, 2006). Gene One will adopt transformational leadership by communicating the company’s vision to the employees, modelling their vision to align with the company’s vision and finally, building the commitment to that end-state vision. Transformational leaders are more likely to empower employees and give them authority to be more independent and feel more responsible and committed to their tasks by eliminating unnecessary controls and building empowering culture. Such behavior enhances the employees’ self-confidence and creates new boundaries in leadership structure. It also will increase innovation and open the communication between leaders and employees by eliminating hierarchy and creating new cross-functional teams. In the case of resistance to change, there are seven tactics that can be used to help overcome this resistance to changes in an organization: (a) Education and communication - Education can give employees the full facts and clear up any misunderstandings they may have. Effective communication can help understand the need to change, (b) Participation – employees allowed to participate in the change decision process are least likely to resist the changes, (c) Building support and commitment – Studies have shown that counseling, therapy, and new skills training lower anxiety and assist in the adjustment, (d) Negotiation – when resistance is caused by a few powerful individuals, a specific reward package can be negotiated that will meet their individual needs, (e) Manipulation and cooptation – is defined as the twisting and distorting of facts to make them appear more attractive, the withholding of undesirable information, and the creation of false rumors to get employees to accept a change. Cooptation is used when the leaders of a resistance group is bought off by giving them a key role in the change decision. The leaders’ advice is sought to get their support, (f) Selecting people who accept change - it appears that people who adjust best to change are those who are open to experience, take a positive attitude toward change, are willing to take risks, and are flexible in their behavior, (g) Coercion – Coercion is the application of direct threats or force on the resisters (Robbins, Judge. 2007). Communication structure People may become skeptical about a vision that promises too much and seems impossible to reach (Yukl, 2006). The new CEO can transform that attitude through open and creative communication about the changes and IPO process to ensure employees’ complete understanding of his vision and its transparency. If the changes are not communicated properly it could lead to undesirable results in the organizational culture. Communication change will occur through learning processes such as knowledge transfer, mentoring and coaching. Communicating with employees and keeping them informed about the IPO process is vital, but also important is the communication with stakeholders, providing them with up to date and accurate information. Conclusion Gene One’s biggest challenge is to transform the culture of the current organization with its start-up spirit into a public entity focused on growth and profitability. Gene One’s change strategy supports communication, learning process and cross training opportunities to achieve its end-state vision to become a successful publicly traded entity. The leadership structure and styles are important because creating a strong leadership team for a transformational organization proves to investors the ability to adapt, change and grow on a solid basis. References Learning Team B. (2010, March 8). Week 5 assignment. Message posted to University of Phoenix class, Learning Team B forum LDR/531—Organizational leadership course website Robbins, S. P., and Judge, T. A. (2007). Organizational behavior (12th ed.). Upper Saddle River, NJ: Prentice Hall Yukl, G. (2006). Leadership in organizations (6th ed.). Upper Saddle River, NJ: Pearson Education, Inc.Saddle River, NJ: Prentice Hall