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MMH365 CHANGE MANAGEMENT Final Case Study Report Change Management concerns within Fairfax, interventions, process and strategies, including unambiguous suggestions for the management of the continuing internal and external change Madeline Stevens, 213357986, MMH356, Final Report

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Page 1: Change management concerns within fairfax

MMH365 CHANGE MANAGEMENT

Final Case Study ReportChange Management concerns within Fairfax, interventions, process and strategies,

including unambiguous suggestions for the management of the continuing internal and

external change

Madeline Stevens, 213357986, MMH356, Final Report

Page 2: Change management concerns within fairfax

Table of contents

TABLE OF CONTENTS II

ILLUSTRATIONS III

EXECUTIVE SUMMARY 250 IV

BACKGROUND 100 1

1. INTRODUCTION 100 2

2. FAIRFAX ORGANISATIONAL CHANGE 3

Environment 4

Key Change Issues 5

Cultural Change 6

Structural Change 7

Strategic Processes 9

Process Interventions 11

CONCLUSION 100 13

RECOMMENDATIONS 200 14

REFERENCES 15

II Madeline Stevens, 213357986, MMH356, Final Report

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Illustrations

Page

Figure 1: Australian Metro Media Financial Snapshot 8

Figure 2: Application strategies for Transorganisational Development 9

Figure 3: Strategic Analysis 2011 10

Figure 4: Communications in Human Resources 12

III Madeline Stevens, 213357986, MMH356, Final Report

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Executive Summary

This report provides an evaluation and analysis of the current management of change

within Fairfax Media Limited. Due to the shift in online technology Fairfax have proven

that there is a need for constant change management. Within Fairfax there has been

not only the management to assist with all types of change but interventions around the

cultural and structural issues faced in their over 180 years existence. The approaches of

managing change have been developed over some time with the findings of information

analysed being seen as the digital industry develops even faster then first anticipated

causing printing manufacturers to branch out into alternative options to sustain survival.

Finding that the printing industry of Fairfax has had to remodel the entire business that

once use to be a standalone corporation, this restructuring has caused some retaliation

predominantly within the community directly linked to the diminishing printing

production. Reviewing financial reports and analysing some valuable statistics it is

apparent the dedication and drive Fairfax have, with the support of employees and

stakeholders whom have finally realised this was the only chance at staying afloat. With

their strategic acquisition of several newly adopted businesses within the media and

advertising they have attempted to redesign their image.

Overall there has been a fight within the organisation to hold their position that has now

shifted to an online media business. In this report there are clear recommendations and

successfully executed strategies within the organisation but they are fully aware of the

capability of the unknown and continuously developing online network combined with

the driving force of the consumers that is cause forfuture limitations.

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Background

A more comprehensive understanding of Fairfax Media is essential due to over 180

years existence within the media industry but also their change in ownership and

struggles with obstacles like the introduction of mainstream technology and our evolving

population.Like most formerly established newspaper printing organisations there has

been an ongoing struggle with entering and succeeding in the growing online world.

Due to the size of Fairfax the struggle was constantly in the news headlines and stock

markets suffered immensely (Jaspan, 2012). Launching from the first Sydney

newspaper back in 1953, to the struggles and adaption to the newly styled paper to

broaden their reach the struggle within this empire has not been entirely stress-free

(Sydney Morning Herald, 2013) yet with all the hurdles faced they have been able to

evolve into the media giant they are today (Fairfax Media, 2015).

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1. Introduction

This report will be focused on Fairfax Media Limited and the struggle to maintain its

presence within the market and what interventions have been implemented to keep not

just afloat but continue as a market leader (Fairfax Media, 2015).Within this paper I will

provide the key details with the application of three specific interventions applied, and

provide a comprehensive analysis using historic information, reports, articles and results

based on strategic key change management concepts. This will help to gain a greater

understanding of the evolving technology within the media industry and how Fairfax has

been able to survive and restructure successfully.

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2. Fairfax Organisational Change

Leading Australia and New Zealand in the media industry Fairfax now provides the

largest range of diverse divisions referred to as a multi platform media group their

market share current price at $0.88 (Invest Smart, 2015) the several branches now

being specialised include newspapers, magazines, radio, Domain group and digital

media (Fairfax Media Limited SWOT Analysis, 2015, p6). These branches mentioned

are only a brief description into the numerous popular and highly recognised online and

printed content along with the ongoing attainment of already well-established

organizations to add to the plethora of media outlets. When looking at the multitude of

what Fairfax now covers it is easy to understand how and why the efficient

implementation of change management has been necessary, change itself is expected

and regardless if organisations are proactive in business operations it is not a guarantee

of success. Caution is needed for balance in the amount of change that is pushed into

each project decision and also avoidingthe risk of too little. It can be seen as a waste to

plan too far into the future in regards to change anda waste of vital resources, hence the

importance around balance.

There has been an entire shift in the media industry and the need for change has been

recognised and evidently implemented throughout. Change management can be seen

as both long-term and short term with the two complimenting each other overall, the

purpose of this allows for adjustments and improvements as they are shifted into a more

permanent culture and core values. With the focus on change and adaption, there

should be extra attention on ensuring any negative repercussions are monitored with

the main purpose of the change implementation being positive and proactive. There are

so many levels and sub levels when dissecting the actual functioning process of

change, sometimes focusing on the weaknesses are not the most productive but the

opportunities and strengths that directly link help maintain the competitive edge (Fairfax

Media Limited 2015).

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2.1 Environment

The general environment is viewed as everything outside of the organisation yet has

direct influence on the whole operational component; there are three specific

environments, which can be either direct or indirect. Due to the open system within

organisations there must be a relationship with their environments if functionality and

success is desired. Organisations can also directly or indirectly impact the environment,

which is where laws and regulations must be followed and promoted within the business

to create a positive and favorable brand (Waddell et al. 2014 p.261-273).

The overall environment directly linked to Fairfax includes technological, social, political,

and economical. The technological dimensions would be viewed as the most important

direct element (Porter, M 1985) within the media industry having to adapt and evolve

from the declining paper hard copy (Christensen, N, 2014) to not only online but

creating a diverse branch of alternative services to offer to the audience to keep up

within the media market’s shift towards digital interaction. The internal environment

must process information in order to better understand the current environment, this has

been found to be slightly ambiguous but no matter how much you try to reduce this

there will always be some kind of uncertainty (Waddell et al. 2014 p.262-283).

The never ending needs and consumersatisfaction is a key task environment, by

developingthis core objective it could possibly be the most significant environmental

influence. Internally with the driving force being competition Fairfax have product

innovation and expansion, which is done to keep afloat, if not to keep ahead of

competition which are all apart of the external task environment. The direct relationships

whether through, customers, suppliers, competitors, financial institutes, are all mutually

influencing on each other, which can be taken advantage of if managed properly

(Waddell et al. 2014 p.262-264).

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With all of the above-mentioned in mind Fairfax has a solid brand and market imprint

contributing to its enacted environment, which is why the organisation is still standing

steadily with two feet. Through all of its struggles and victories there is a strong

environmental culture where we see risks taken and new ideas constantly emerging,

which drives everyone involved to continue building and remodeling the facade of this

empire. With such a forward foot to survive in the future, which is evident with

simulations applied like the Monte Carlo sensitivity analysis to test the growth rates

finding out the strength of their models (Sydney Investment Group, 2011).

2.2 Key Change issues

Fairfax can be viewed as a leader in change within the corporate organisation

community, with some of the changes either internally and not viewed by the external

buyers or sometimes not as successful or implemented as originally planned.No matter

how successful the outcome,what this does show is Fairfax are willing to fight for their

position within the market and overall there has been a stable position held due to the

awareness of their key change issues (The Financial Times LTD, 2015).

There are three key interventions, which have been how the organisation has

developed through numerous interrelated issues all based around diversity, interaction

of human behavior and technology. With a key focus on both structural and operational

changes incorporating the interventions Fairfax have claimed to be well ahead of their

plans to being a modern media company (CEO Speech). However, Fairfax’s previous

and ongoing changes still require extensive monitoring and refining which ensures they

will bemuch more confident inthe ability to work through any future issues that may arise

and how they have adapted and grown with the additional industries added to the

organisation.

It is important to keep an open mind and look at the Macroeconomical position with the

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introduction of the online world wide when looking at the key change issues presented

in Fairfax. As impacting e-commerce has been on the industry this scenario has

impacted the entire world causing a shift in the way businesses need to function. With

incorrect management guiding the journalistic based company it actually hasn’t steered

too far from the style and underlying tasks being completed. The decline cannot be

focused based on only the technological world, but the shift in wants, needs and desires

along with the core subscribers including more females and change in interests. These

types of assumptions are not always entirely true nor do they predict the change I

direction would actually benefit the papers subscribers, on the other end of the

spectrum there are the loyal readers who no long find the paper informative or struggle

to read its more modern layout and smaller print.The actual driving revenue was the

advertisements placed, and the management behind all significant decisions have been

criticized for blaming it all on the shift to online rather then the possibility of just bad

management (Green, 2012).

2.2.1 Cultural Changes

Culture tends to be overlooked as a highly strategic method to implement change

indirectly forcing greater effectiveness, with values and assumptions to be incorporated

allows for less liability when implementing changes in such turbulent environment as

Fairfax. The correct and satisfactory management of culture would see a higher team or

group participation rate along with open communication, security and equality, all of

these additional aspects although not always a clear representation of how an

organisation is functioning the change in culture is recommended to be observed

strategically (Waddell et al. 2014 p.322-332).

Downsizing of the organisation (Appelbaum, Everard, Hung, 1999) is attempted

strategically to maintain a presence and avoid complete extinction but the goal to

ultimately redeploy as many multi skilled employees within new and merged rolls

throughout the entire organisation (Hurst, 2012). When applied correctly it can improve

the fit between individual abilities and the demands of the shifting jobs. When it was

announced in 2013 that the plan was for a 3-year implementation of one-fifth of Fairfax’s

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workforce to suffer job cuts it was hard to see past the employee’s potential loss of jobs,

when regrettably it was the only way the struggling printing division of the organisation

was to survive (The Australian, 2013).

Within the internal environment there are struggles like job security and resistance to

change which are tackled by working with the employees and promoting realistic

expectations and support incorporating programs like health promotion and career

planning also create a positive and safe environment when there is such uncertainty

around (Waddell et al, 2014, p.157-161). The key focus within the working culture is

equality (Hywood, 2015), which is clearly displayed by each division leading the industry

with awards and recognition (Fairfax Media, 2015).

The internal and external drivers of implementing an innovative and diverse culture

creates a multidimensional and productive environment, these are forces that drive

change within all levels of the organisation (Kennedy &McComb, 2014). The SWOT

analysis has helped assess and minimise any impacting influences (Fairfax Media

Limited SWOT Analysis, 2015, p4). The organisational development interventions used

are practical and achievable models that are designed to solve goals or improve

productivity, which creates a positive and motivated working environment.

2.2.2 Structural Changes

The restructuring of the business (Zappone, 2008) gives structural direction as it

evolves and recreates itself, which allows for the organisation as a whole to develop

and hold a presence within the previously dying print industry in the new online era

(Hatch, 2013). The social and technological systems within an organisation should both

be supported when looking at the organisational design not only to address problems

but also to create alternative results (Waddell et al, 2014, p.150-155). The

organisational system of the technical model is always a risk resulting in some barriers

to job enrichment, the limits of technology can cause an enrichment ceiling with barriers

of the overall process and procedures.

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The better the knowledge of the over all environment the more understanding we have

on our audience, although Fairfax wouldn’t have originally been considered to be

dynamic and unpredictable the external factors have causedso much uncertainty

resulting in the whole industry needing tobe restructure. Fairfax’s entered the media

industry formerly with their infamous news papers and that particular section of the

business has now faced all kinds of restructuring to gain efficiency and maintain their

position within the printing market, it is only with the internal environmental changes and

the success of implementing online alternatives has there managed to be a profit within

this section.

Figure 1: Australian Metro Media Financial Snapshot

(Source: Fairfax Media Annual Report, 2015)

Although outside of our control the general external environment can have a direct

influence on the whole operational component, the technological dimensions would be

undoubtedly the most important element (Porter, M 1985). Fairfax is constantly in the

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news headlines for the reshuffles and changes promising it will drive revenues and

efficiency. Implementing these types of changes Fairfax need to ensure they are the

correct changes to the business processes, Fairfax is a tall hierarchy structure and is

slowly transitioning over to a more flat organisational structure which will help

management and employee relationships internally (CEO Speech, 2013, p.5). Another

way Fairfax is working with external environments is to actually improve the operations

are drivers like the Fairfax Mobile Network Survey conducted in November 2014, this

report providedessential insightsinto their users which would assist with improvement

and restructuring if deemed necessary (Fairfax Mobile Network, 2015).

2.3 Strategic processes

By transforming to an online presence (NewsHound report, 2005) and keeping up to

date with new trends and technology within the media industry helped assist with

maintaining a competitive edge in the rapidly changing conditions (Porter, M 1985). This

strategic process was Fairfax’s way of adapting to the online culture, which added

multiple branches to their business expending the overall reach and brand. This also

enabled an extended audience reach along with the ability to amalgamate some

employee roles together.Transorganisational development has been applied to

collaborate the now multi-organisation, this creates a stronger relationship and

competitive strategies resulting in improved services and a stronger economic position

(Waddell et al. 2014).

Figure 2: Application strategies for transorganisational development

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(Source: Waddell et al. 2014 p.271)

The results found in the “CFA Institute Research Challenge” provided a deeper insight,

which showed one specific reoccurring piece of evidence, and that was the importance

and impact online technology has affected, and will continue to guide the entire

industry(Sydney Investment Group, 2011).

Figure 3: Strategic Analysis

(Source: Sydney Investment Group, 2011)

In conjunction with time quality management (TQM) and a strategic analysis

implemented internally we would see the internal driving force improved as it seeks

efficiency and productivity within the organisation (Douglas, 2013), meaning the way

executives respond to the improved environment. A perfect example of strategic

implementation within Fairfax is the new acquisition of Property Data Solutions (PDS), a

property data and mapping provider shows the ability and intellect behind strengthening

the brand creating prospects as a tactical investment, which provides product offerings

and variety in its income base (Fairfax Media Limited, 2015).

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2.4 Process interventions

The actual process of the interventions must be noted as an important part of the whole

method used, as it is the employees tool for achieving the organisational goals (Tearle,

2011). The key interventions for Fairfax that are utilized differently throughout are,

performance management, appraisals, reward system and goal setting. All of the

interventions mentioned above are built into the Fairfax program but as most other

organisations this must be closely watched and altered if required (Ads Centre, 2015).

The effective management of people can also be referred to as performance

management, this is the actual management of the performance of the workforce in an

organisation. This particular type of management can be the teams performance or

individual and is very dependent on individual factors, with alignment as one of the key

component when looking at successful performance management systems. There

should be a clear and defined link between the organisational goals and objectives and

the management of performance, which must also align itself with the appraisals

conducted. A top down approach is being moved away from and there is a push

towards a multichannel communications process. The issues of underperformance

should also be mentioned as a usually overlooked issue, this should be solved with an

internal systematic approach to address the matter (Ashdown, 2014).

Figure 4: Communications in Human Resources

(Source: Performance Management, 2007 p.80)

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In implementing performance management and appraisals to educate the employees it

always needs to be followed by evaluation and rewards, this compliments the process

as a whole and provides guidance and incentives to maintain this level of standard. The

biggest issues faced are conflict and encouraged competition, which in return causes a

negative working environment (Roth, WF 2014). The reward system itself can be either

intrinsic or extrinsic, where intrinsic are internal forces driven from challenge,

improvement and accomplishment opportunities found in the workplace. Extrinsic is the

various kinds of monitory based rewards but the behaviors behind the drive of these

should be regularly reinvented to keep the workers interested (Waddell et al. 2014

p.174-177). It is the role of the human recourses and management to try and combine

the two within the personal and group satisfaction. This model is the root to the reward

theory and must always be observed, as there has been studies presenting undesirable

relations between the two and its relation with motivation and

performance(Harackiewicz&Sansone, 2000 p14-18).

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Conclusion

Throughout Fairfax’s history there have been many struggles within the changing

environments implemented through the whole organisation that has proven to maintain

the consumers satisfaction. This being the core objective and possibly the most

significant environmental influence the task environment is one of the key management

concepts as the driver of the organisation. Although technology is a major component

and should not be overlooked the cultural influence would almost outweigh the

importance of controlling the decision-making and further understanding within the

unstable environment.

Fairfax has all the right intentions in managing the change environments, although

successful in implementing these initiatives there is still a large amount of unknown,

which is driven by external forces. With the brand holding such a strong position it would

be impetrative that the correct steps are continued to be taken for enduring success.

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Recommendations

It is evident that the change management strategies employed by Fairfax have

displayed to be proactive and allowed them to be a key player within the multi-

dimensional media industry; they have restructured and expanded exploiting their

stronger abilities to maintain the market leader.

Based on the research and critical analysis of information the following

recommendations are made:

External environment has been the greatest battle for Fairfax and the early

detection and proactive battle is the reason why the business still stands, this

strategy should continue to ensure it is ready for any change from external sources

that directly link back.

Internally there needs to be a greater implementation of understanding and

management due to the uncertainty around the restructuring and closure of so

many of their printing branches, with a focus on redeployment and role

restructuring.

The trans-organisation system should be religiously tracked and applied to assist

with the cost and benefit challenge faced, and also to create a stronger brand and

image within the Fairfax community.

The process interventionsmotioned within this reportcreate value and a unique

realignment of the employees and organisational goals and objectives, by creating

a culture where employees feel support motivation is achieved.

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