Jaguar Motor Company

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Executive Summary

Jaguar is a motor company that has under gone several changes over the years to attain the brand it holds today in the public domain as a car of class. This assignment looks into the critical stage of its success when the company was undergoing strategic change in four areas namely the plant structure, communication, culture and leadership and management. The assignment further concludes based on the given information before making recommendations on the aspects that could have been handled better in the strategic change management.

Introduction

Jaguar a motor company which was originally known as the swallow side car, and has evolved over the years since its inception as a company that was making motorcycle sidecars in 1922.  The company progressed and began making cars, switching its name from swallow side cars to Jaguar when they began making cars in Coventry after the Second World War. Their first premium saloon and sports cars included sports cars, with their flagship car being the legendary XK120. 

The company later launched one of its iconic sports cars, the E-type, in 1968 before merging with the British Sport Company, which became part of British Leyland, land rover and launched the first land rover range.  Land Rover was later made a stand-alone by British Leyland due to its success in 1978.  

Jaguar became an independent company in the 1980’s before its purchase by Ford in the 1989 which made the company very similar in terms of engineering knowledge and facilities. 

The company which was purchased by Tata Motors in 2008, having grown and improved on the models in several aspects of the company.  The company was officially joined as one company in 2013 of which has benefited the company in many aspects. 

In the twentieth century, Jaguar was undergoing a change programme to enable them be able to create new ways of working.  The culture of the organisation was very strong and management experienced rigid resistance to change barriers.  Henry Ford, the creator of the manufacturing system known as Fordism was responsible for the motor industrial revolution.

This report seeks to identify and analyse the strategic change that occurred in Jaguar. The essay will further iron out the need and causes for the change before justifying the change. Lastly, the essay will recommend if the change that occurred could have been handled in a better way or whether the change was done appropriately.

Analysis

Organizational Change

Jaguar was initially founded in 1922 and from its inception it established itself as a luxury manufacturer, emblemising style and status. In 1963, Ford Halewood began to produce the Ford Escort, with production amounting to over six million vehicles and an impressive maximum employee roster of thirteen thousand.  Jaguar, suffering a variety of management downturns resultant from a combination of new industry entrants to just generally poor management, began to be supplied by Halewood for the Jaguar X-400 in 1998, as the company outlook was looking bleaker and bleaker by the day, with many analysts suspecting an impending demise.  Running opposite to Jaguar’s impending doom was Halewood, who during the early eighties reached a peak of sorts, employing thirteen thousand people producing more than two hundred thousand cars each year.  Bu the early nineties those numbers had dipped to about a hundred and fifty thousand cars and about half the amount of employees, and by the time 1998 rolled around and Jaguar moved in, Halewood’s staff was down to around three thousand and they were producing around a hundred thousand vehicles each year.  Once formed, the Halewood/Jaguar management focus revolved around quality, centre of excellence, and culture change.  The new formation also published a system of values to guide its behaviour, including customer focus, open communication, adaptability, teamwork, flexibility, quality, and accountability/responsibility.

As mentioned, the Halewood facility opened in 1963 and for much of its history it produced Ford models, including Ford Escort.  Jaguar, being part of the Premier Automobile Group (which is owned by Ford), assumed responsibility of Haelwood’s operations in 1998, and by mid-2000, Escort production had been phased out.  Even phasing out Escort production gradually still did not make up for the physical and cultural revolution Halewood faced as they began to manufacture the Jaguar X-400, which involved a process change from the ground up in creating a supply chain oriented toward lean manufacturing processes for the X-400.  JIT tenets were utilised, governing the reception, placement, and timing of the correct materials in the requisite amounts.  This involved minimum inventory levels and short lead-times together with reduced handling, all aimed at improving quality and responding quickly to any changes in the production process.  The delivery of materials to the assembly line was all part of a low-cost process where they would be fitted.

The information under the headings will be accessed/analysed by one model: namely, Kotter’s 8 Steps of Change.  This model has been chosen due to its Strengths. The Kotter’s 8 Steps of change was chosen to determine the contingences (Pace of Change) and the approach to the change for which the change under the structures mentioned above was required in the Jaguar/Halewood. 

Structure 

A new and revamped committee of operations (composed of the best Ford/Jaguar human resources) was established once Jaguar took over the plant and implemented a selective and comprehensive replacement process.

As previously mentioned, Jaguar/Halewood’s new orientation and approach to management was to be lean.  A new organisational structure was needed to help coordinate the activities of different people, each involved in some division and specialisation of labour, coming together in order to create the “new” Jaguar.  Jaguar Halewood only existed as a way to help revitalise and resuscitate what many believed was a dying a brand, and Jaguar saw the lean manufacturing principles as the solution to resurrecting themselves.  It was this process and these principles which were the “Centre of Excellence.”

The plant was also refurbished to achieve quality and production objectives.   The re-structuring was an effort to make the organisation more efficient and responsive to customers on the global scale.  This was achieved by changing the supply chain to a lean one which was a more adaptable method to the jaguar brand however in order for this to be successful, it required new, process design, product development, facilities, logistics network, and production process design all at once.  

The re-structure provided an opportunity to reduce the number of suppliers in order to simplify the assembly and logistics process.  The concept of modularisation was applied to the logistics process by defining the interfaces between different processes to allow room for the process to be outsourced to a third party provider. 

The structure was a flat structure of three tiers which is leaner and fitter, more flexible and better able to cope with changes in the external business environment.  According to Sloan, A.P., “the flat structure is a concept of the decentralised, and multi-visional organisations of today were first known as General Motors (p. 47)”.  David Hudson was the new lead for Jaguar operations.  He was a twenty year veteran of Jaguar and had served as Ops Director for both of the Jaguar West Midlands plants; his reputation preceded him, being regarded as responsible for transforming both Jaguar and Rover in the eighties and nineties. He composed the structural team at Jaguar Halewood from existing personnel at each company. According to INSEAD (2002, p 15), This new structural team would be instrumental in adjusting Jaguar’s trajectory, revitalising the company from bottom to top in an astoundingly short period of time, only three years.  Consider the ineffective nature of the older structure at jaguar, operations became divided into specific, specialised divisions which included personnel, transition team, PVT, Plant Quality, Corporate affairs, manufacturing, Controller, and quality operation system.  These all composed the newly departmentalised second tier.  M&L, Trim and Final, Press Shop, Body in White and paintshop all composed the third tier, with all of the divisions and departments co-dependent on one another for success and functionality, with department heads’ competency taking a much bigger role in influencing the success of Jaguar/Halewood.

As a result of the structure, the management ensured competencies became a core/key for Job placements especially for the heads of departments.  Notable personalities that were selected include the 10 years of experience of David Crisp who was the communications manager. The veteran Team leader with 34-year experience during Ford-Jaguar Transition along with other notable managers that had the requisite experience were maintained during the transition. 

To sum, up the structure was required to enable them be efficient and effective with the quantity of production by using notable key personalities that had years of experience in the job as departmental heads. 

Staff Relations

Halewood had already established itself as a company with a reputation for poor industry relations.  Halewood Stewards were actually responsible for leading the first two national strikes against Ford’s plants in Britain.  In the late sixties in response to abrasive management strategy, a militancy on the production line and in the shop was born and intermittently but reliably reappeared throughout the seventies, eighties, and nineties.

Many were anxious that this history of labour challenges would adversely affect the Jaguar deal.  The unions on each side developed a process known as the green book, which involved the idea that any change—any lasting, useful, impactful change—must occur at a group level and be targeted to shaping, informing, changing, or otherwise influencing the different norms, values, and roles within that group.  Then, once Hudson had brought union members over the West Midlands facilities, they understood that the behaviour of their fellow workers there was a good, effective, and proper way to manage a successful business.  Once everyone signed the green book, the individual perspective theory became relevant, as each union member was approach individually to sign it, with one remarking that “it boiled down to my own decision of standing still or going forward. I chose to go forward by signing it.”  Although the different theories of change helped to secure signatures for the green book by members of the union, there were also sparks of force brought to bear on them.  Extrinsic motivation was caused when Halewood union members saw how those at the West Midlands plant operated, although on an intrinsic level they were not particularly thrilled about the changes that were coming to Halewood, and they resisted the change because they weren’t certain that management was entirely committed or resolved to change, remarking that “We don’t want to build Jaguar cars with Escort money,” although eventually they ran with the ideas and were successful.

To sum up, it was uncertainty for the future that caused them to resist but once it was accepted, it was evident that it was the best step taken by the staff.  Signing an agreement form makes an individual agree to the terms and conditions as it is a form of binding contract therefore one is obliged to work towards the terms of the contract. 

Culture 

The prevailing culture was an unfortunate lack of respect in all directions—vertical, horizontal, and lateral.  This lack of respect is represented well by what one of the operators alleged when he said, “we were asked to leave our brains outside of the gates.”

Knowing that they needed to expedite the process of cultural change in order to secure Jaguar/Halewood’s success, they hired Seen Delaney Leadership, which is a consulting firm who specialised in cultural concerns like attitude and relationships.  They were already very experienced in consulting within unionised and industrial environments.  What Delaney did was to take the workforce through a customised and specially designed workshop which was designed to foster and cultivate the “Halewood Difference” culture into them.  Major elements of the process of acculturation included instructions in accountability/responsibility, mutual respect, open communication, adaptability, and a good, quality, customer-oriented focus.  Jaguar Halewood also underwent training according to the dynamic theory, where personnel from all throughout different departments and divisions of Halewood were selected and trained in mixed groups, and conducted alternatively so that the group dynamics could be detected.

Participants in the training session were also able to interact with facilitators such as Hudson, which helped contribute to the reformation of the culture through an open system approach.  Here is where human resource policies become critical, reflecting and reinforcing organisational values and culture, since there isn’t a singular, “best” culture.

Hudson changed the thinking style and perspective of 3000 workforce of the organisation by creating mutual respect and trust amongst the workers. According to Hudson, “There are no bad plants, just bad management”. (http://www.managementtoday.co.uk/tale-halewood-jaguar-story-ramp-up/article/549361) This theory was used to mentioned that company used the theory.

Building a strong and motivated workforce has enable the company progress as they currently produce a car every 82 seconds, working 24hrs. This was achieved by empowering them and giving them the necessary tools they required work.  As this method was employed, the workforce grew in number whilst the quality and quantity of production was maintained. This helped the production spend less time concentrating on metrics and more time on the shop floor to concentrate on key production success factors and remove any roadblocks that can occur in the interim. 

To sum up, the culture was improved to ensure that the workforce are able to work better for the organisation. 

Communication 

As Jaguar took over Halewood, there were a variety of communication difficulties requiring address in during the change process.  There are two main reasons for this; in the first place, communication is an essential and integral element of every human interaction.  And in the second place, the continuity and success of business activities depend in large part on effective and efficient business communications.  The communications network at Jaguar Halewood was comprised of many different actors and stakeholders from every direction: the media, employees, customers, and so on; each of these stakeholders will be involved the exchange of important information with one another.  Hudson was primarily responsible for revamping and revitalising the company’s communication strategy.  The chosen adopted strategy devised by Hudson included a regular quarterly meeting with the whole of the labour force, letting them know about all different relevant parts of the company and important activities from data to competitor activity, quality metrics, as well as areas needing improvement and areas which have already been approved.  The general idea was that by implementing this wide-reaching and continuous communication effort, the areas where the company struggled to communicate would be solved.  The strategy developed by Hudson produced favourable results, and it was adopted at each level of the organisation and extended to even more regular sessions and meetings, including daily and weekly.

Hudson used communication methods such as oral communication, newsletters, written communication in email forms, video conferencing, multiple way telephone calls and internal communication strategies to aid the free flow of information within the organisation and also for effective communication. The workforce also employed joint newsletter and the “Gateway Agreement” as a way of communicating. The workforce followed Hudson’s lead by mastering the art of internal communication strategies before moving to external communication. This was employed to deliver customer satisfaction and quality.  

Although the general communication methods were carried out orally and in writing on the shop-floor, the power of non-verbal communication using hand signs, gestures, warm smiles and other body movements were also employed to send the correct messages within the workforce and the customers. 

Regular training sessions and meetings was also beneficial as it allowed the workforce to improve upon themselves. It opened the eyes on their roles on the workforce, released distrust and reminded them of their functions in pursuit of a common goal within the workforce. 

In summary, the developed methods of communication helped the company move forward as staff relations and customer communication was significantly better.

Leadership and Management 

As he proved instrumental in other stages and elements of the change process, Hudson once again was the lead for the leadership and management transformation at Jaguar.  The change in leadership at Jaguar/Halewood occurred as a result of leadership and management both broadening and elevating employees’ interest through the generation of awareness of the mission and purpose of the company, and that awareness naturally led to an acceptance of Jaguar/Halewood’s mission and purpose, inspiring the workforce to care about the interests of the company as much as they cared about their own.

A transformational leader like Hudson was necessary to help implement the change from an outmoded, outdated, clunking workforce and process to a cutting edge and modernised automobile manufacturer with an emphasis on lean principles.  Through an emphasis on hard work, vision, initiative, and a carefully crafted organisational culture through training and ethics, as well as the development of an effective communications process, Hudson was able to resurrect Jaguar’s former wealth and global status.  Some of the rewards or fruits of his transformational labour included establishing a state of the art operation at Halewood, making a hundred thousand cars each year, keeping the X-400 launch on schedule, successfully creating a culture of reduction and efficiency, and completely phasing out Escort on schedule.

Halewood used his charisma as a transformational leadership qualities to communicate the purpose and mission of the jaguar/Halewood of which was accepted by the workforce. A transformational leader attains success in the eye of an employee and this is central to the success of an organisation.  They give an employee a high level of confidence and trust and this therefore made the workforce look beyond their self-interest for the good of the organisation.  As a result of his leadership style, they employees were easily bought into his ideas as he was considerate and cared for the employees individually.  Hudson put together questions and answers during organised workshops which was named the “Halewood Difference”. This was designed to help change attitudes, behaviours and value of employees at Jaguar/Halewood. 

In summary, the leadership style of Hudson was effective and accepted by the workforce of which helped with the transformation of the company. 

Approach to Change

The changes that were introduced were accepted and implemented by the workforce. Considering the turnaround time by which Halewood was able to improve the structure, culture, staff relations and communication, it can generally be a factor of multiple approaches to change.

The change contingency was a gradual/continuous change that occurred over the period of approximately three years.  This type of change can be classed as a re-construction (or turn around).

According to Kotter and Schlesinger, there are six types of change.  They are;

Education and Communication- Where there is a lack of information or inaccurate information and analysis but upfront communication and logic is accepted

Participation and Involvement-Where the change initiators do not have all the information they need to design the change and others have the power to resist but an involvement in the change programme makes the employee accept the change. 

Facilitation and Support-Where people resist change due to adjustment to the new change. This can be overcome when managers are supportive of employees. 

Negotiation and Agreement-Where someone or a group has may lose out in the change and they have the power to resist. Incentives can be offered to employees not to resist change. 

Manipulation and Co-option-Where other tactic will not work or are too expensive. A more effective technique is to co-opt with resisters. 

Explicit and Coercing-Where speed is essential and to be used only as the last resort.  Managers force employees to accept change or they lose their jobs. 

Considering the types of changes identified above, it can be established that Hudson used a combination of the types above namely Education and Communication, Participation and Communication. This was the strength of the change programme which helped the change become a success.  The company relied on co-operation because it was not only a staff and management war that was on-going but a staff to staff war as they was no cohesion, collaboration and communication.  Although these methods were used in the approach.

The leadership style of Hudson had elements of Participation, Collaboration, Direction and Persuasion. Hudson leadership qualities was very good as he implemented parts of all the mentioned styles of leadership to achieve results.  With this, he also ensured that a quick pace of change was employed to correct the structure, communication, culture and staff relations. 

Kotter’s 8 Steps of Change

Using the Kotter Model, the following details below can be deduced from the analysis that has been discussed above. 

Establish a Sense of Urgency- This was identified when they realised to achieve the production of the cars so they had to structure their production into a lean one management 

Form Powerful Guidance coalition – This was achieved by assembling key staff with experience notably those that have been at the organisation for more than 10 years to head the departments. 

Develop Clear vision and strategy- This was achieved by establishing that they wanted to improve on the structure, communication, staff relations and culture. 

Communicate vision- This was achieved by organizing meetings to discuss issues affecting the organisation, as they developed communicating methods such as gestures that were to be used between staff and employees. 

Empower others to act on vision- By encouraging them to develop new ways of doing things which were not being done in terms of communication and working in the plant, it was achieved. 

Create short-term wins- This was achieved when staff that were willing to channel change and voice out issues during meetings with Hudson were rewarded.

Consolidate improvements and produce more change- This was achieved when the change was accepted by Key staff. It became easier once they had accepted to change policies and strategies governing the culture of the organisation. 

Institutionalize new approaches- This was achieved when Hudson introduced new methods of working which was accepted and became a policy and working pattern for the workforce.  Hudson ensured that the heads of departments to avoid resistance accepted and implemented it. 

Conclusions

Based on the analysis, it can be established that the strategic change employed by Hudson was effective.  He used various forms of styles to support his change regime which worked very well to his advantage. 

The structure of the plant needed to be reformed in order to be effective in production of the car quantity per year. They therefore spent approximately 300 million pounds into the plant making 95% of the machinery and assembly lines new. They also worked on their supply chain by outsourcing a part of it in order to be able to manage it effectively.  This increased their productivity by 18% within the first year. 

The culture was gradually changed although it faced resistance with some un-cooperative employees however they later were receptive of the change of which the staff to staff and customer relations was improved upon. 

Communication was improved as they held regular workshop meetings to ensure that there is cohesion amongst employees. They further developed gestures on the plant to communicate with each other.  This complimented the workforce as an increase in communication affected their volume production positively of which boosted their morale. 

Leadership and Management was the best quality of Hudson as he was able to use a mix of leadership styles to achieve the transformation. In almost all situations, he ensured he took on board the views and concerns of the workforce. By so doing he was able to garner their confidence as they felt they could talk to him for solutions to problems within the working environment.

In summary, the change was accepted and this was evident in the figures that were given as they increased production and profitability due to a culmination of various actions which affected the culture, attention to detailed responsibilities which translated into end products with speed and customer satisfaction. 

Recommendations

Considering the information given and analysed, Hudson was very good at the strategy implementation however it can also be said that a few minor mistakes had been made in the implementation and the strategy was also slightly dangerous. 

Changing the structure, culture, communication and leadership of any organisation means re-structuring the entire organisation and how it performs. With that being said, it was necessary to involve just the key players of its intentions and not the general workforce. Although the workforce has to buy into the idea, it is also risky to give so much power to the workforce because they will dictate the pace of the change and also what they will agree to be changed but involving just the key players make it easier because they are able to enforce change in the entire workforce as they control the key aspects of the organisation that require amending. 

They could have also employed Explicit and Coercing methods to inform employees that were not willing to change even though they lose some of their staff during the regime. Hudson was a bit too co-operative with the staff which made them have the power to resist and dictate.  

Lastly, a strategy that seeks to make a complete overhaul in three years can either go good or bad however a steady change is always in the positive direction. The change was very drastic for the size of the workforce and this was countered with initial resistance by the workforce. 

References

Sloan, A. P. (1986) My years with General Motors. Penguin: Harmondsworth. 

INSEAD (2002), Jaguar comes to Halewood: The story of a turnaround, Fontainebleau, France  

http://www.jaguarlandrover.com/gl/en/about-us/our-history/, accessed 11/11/2016 

 http://businesscasestudies.co.uk/jaguar/changing-the-culture-at-jaguar/changes-in-the-car-industry.html#axzz4NcdDSk4Q, accessed 11/11/2016

http://www.managementtoday.co.uk/tale-halewood-jaguar-story-ramp-up/article/549361, accessed 11/11/2016

http://www.northofenglandexcellence.co.uk/news/how-we-transformed-halewood-by-jlr-boss/137, accessed 11/11/2016

http://www.valuebasedmanagement.net/methods_kotter_change_approaches.html, accessed 11/11/2016

http://freightbestpractice.org.uk/jaguar-sprintsforward, accessed 11/11/2016