Blog 3: Change Management

Nowadays, the rapid development of the global economy makes the world pattern constantly change.How to deal with change and how to manage change are challenges for many businesses currently.Innovation and change can make the company continue to progress and develop, but it is not easy to implement.  Organizations that handle change well thrive. So the successful leaders need to be positive and effective to face the change.In my blog, I will focus on fashion industry and discuss its impact of the Brexit based on the change management theories. The solution and recommendation will be included at last.

What will happen to the UK economy by Brexit? According to statistics, the UK exported goods worth 133 billion pounds to the rest of the EU, almost half of the world’s exports in 2015. This could take a major hit on export businesses in the UK, as their costs will hike up with the increased tariffs.This will lead to a decline in the competitiveness of British businesses in the EU market and globally, particularly in the fashion industry due to the British fashion industry relies on international trade, on the prosperity of global talent resources. The UK fashion industry is worth a value to the UK economy at a cost of 32 billion pounds, said by British Fashion Council CEO (standard 2018).Richard Lim, chief executive of analyst Retail Economics states that a hard Brexit with existing trade disappear, and designers, retailers and manufacturers would have to pay to trade with the EU (standard 2019). The threat of Brexit is growing. If without a deal, the UK will lose seamless tariff-free access with the world’s largest economy and be subject to WTO trade rules. Some manufacturers lose their competitive advantage as a result of currency volatility.

Mulberry is a leading British lifestyle brand that founded by Roger Saul with his mother in 1971. The brand is committed to British manufacturing and develop craft talent (Mulberry 2019). Although mulberry is made in UK, its leather raw materials mainly come from Europe, especially Italy. Raw material cost from Italian tanneries are higher than before as a result of the Brexit (Independent 2018). The CEO of Mulberry says the company is struggling to cope with rising leather import costs since the Brexit vote (Independent 2018). So to deal with the currency volatility and rising costs caused by Brexit, brands need to face the challenges through change management.

Management of  change 

According to Lewin (1947a,1947b), because people in an organization work as groups, individual behavior must be observed, modified, or altered in accordance with the group’s general practices and norms (Burnes, B. 2009). So the change of organization is important. The Lewin’s change model could be used by Mulberry brand and fashion industry to face the issues and is widely used by companies. The Lewin’s theory performance by the three stages of changes: Preparing the desired change, implementing the desired change and solidifying the desired change (Mulder, P. 2012). Mulberry and the other British brand from the fashion industry could go to find some local manufactures that could supply the raw products to reduce the cost in logistics. On the other hand, it is a good chance for Mulberry and local brand to promote the products for the tourists because more people choose to come to UK for travel at this time based on the currency volatility. Make some activities and use social media is a good way to to advertise to tourists.

When the fashion industry is start to make change, one of the most difficult parts of change management is the personnel element. The ADKAR model provides a way for teams to complete the change process. The model shows the five sequential actions and results necessary for successful individual organizational changes. The ADKAR Model performance by the 5 stages: Awareness, desire, knowledge, ability and reinforcement. For the fashion industry and employee, communication, coaching, training and celebrating are the significant factors based on the theory.

In conclusion, in today’s business world, change is inevitable. Agile businesses that adapt to changing environments and continuously improve processes can gain an edge in the competition. But deciding what needs to change and how it should be changed is just the beginning. Fashion industry should prepare and make change scientific and reasonable when they face challenges such as Brexit. The leaders also need to provide a long view to face the changing world.

Reference:

Burnes, B. (2009). Reflections: Ethics and Organizational Change – Time for a Return to Lewinian Values. Journal of Change Management, 9(4), pp.359-381.

Mullins, L. and Christy, G. (2016). Management and organisational behaviour. 11th ed. Pearson Education Limited.

Kotter.J.P (2012, 1996). Leading change. Harvard Business Press.

Expert Program Management. (2018). Expert Program Management. [online] Available at: https://expertprogrammanagement.com/2018/02/adkar-model-of-change/ [Accessed 13 Jul. 2019].

Pearson, S. (2018). What’s the ADKAR Model and How to Use It – Tallyfy. [online] Tallyfy. Available at: https://tallyfy.com/adkar-model/ [Accessed 13 Jul. 2019].

Vogue Business. (2019). Will Brexit break British fashion?. [online] Available at: https://www.voguebusiness.com/fashion/impact-brexit-fashion-textile-industry-no-deal [Accessed 13 Jul. 2019].

Lewin’s Change Model PowerPoint Template – SlideModel. [online] SlideModel. Available at: https://slidemodel.com/templates/lewins-change-model-powerpoint-template/ [Accessed 13 Jul. 2019].

Mulberry.com. (2019). Mulberry | Mulberry.com Official Homepage. [online] Available at: https://www.mulberry.com/dk/ [Accessed 13 Jul. 2019].