HRM09403 Organisational Change Management

Module Leader: Dr Rowan Steele

Case Study: Le Chic Restaurant

The Le Chic is a restaurant located on a busy street in the centre of a major city. It attracts a
steady flow of customers who like its commitment to quick service with good food. As such the
management pride themselves on offering a standard menu, which includes a good range of
affordable yet delicious dishes – from starters and appetizers, through main courses and specials
to pastries and desserts. While Le Chic seats around 80 customers, its layout is basic restaurant
style and customers have often said that it has a ‘fast-food’ feel to it which fits with its current
business objectives but may not be ideal for the future. A major concern for management has
always been to maximise efficiency and reduce turnaround times: orders must be swiftly relayed to
the kitchen and the food brought to the table within 15 minutes, even during ‘peak hours’ – the
intended outcomes being consistency in both customer service and daily sales targets.

Le Chic employs 35 people, 50% of whom have permanent contracts, working either day or
evening shifts. The other half is split between part-timers and relief workers who are usually the
ones to do double shifts over busy weekends. All terms and conditions of employment are
negotiated on an individual basis.

Over the past few months staff have found it increasingly hard to maintain the desired levels of
customer service. There seems to be a lack of coordination between waiting and kitchen staff.
Once seated, customers often have to wait for as long as one and a half hours before being served
while a large number of those queuing up outside usually just give up on the long waits and walk
away in search of other eating options, which in the city centre are plentiful. More alarmingly, profit
margins have remained ‘thin’ in the recent years and, for the first time in 10 years losses were
registered on the restaurant’s balance sheet. Le Chic’s current manager attributes this particularly
poor performance to the economic crisis and to the fact that the competition has all of a sudden
tightened up with the opening of a pub and two new restaurants on the main street and a growing
cluster of similar businesses within a mile radius.

Dispirited, the current manager has decided to step down to make way for a new manager, John,
who has just completed his Masters in Business Administration but also has experience of working
in another similar type of restaurant. John’s remit is to deliver a new business strategy that can
effectively reverse Le Chic’s current performance and ensure its survival and growth in the longer
term. Whilst recognizing that these are indeed difficult times, John believes that there is need,
more than ever, for businesses demonstrate an ‘entrepreneurial spirit’ if they are to have any
chance of success. He has therefore formulated a proactive and quite aggressive change strategy
containing the following key components, which are to come on stream almost at the same time:

 Le Chic is to be turned into a chain restaurant. A total of £1.5 million is to be spent on

the refurbishment of the existing site and on the set up of two new restaurants in
different cities.

 The chain restaurant will differentiate its offerings in the form of a revamped more
upmarket menu, a sumptuous décor and a new bar area, for which a select clientele
would be more than willing to pay a premium.

 Around 60 new employees are to be recruited and deployed across the three
restaurants. While all members of staff will have to attend induction training to meet the
new standards of service, some of the more experienced staff will be transferred to the
newly opened restaurants to help out with on-the-job training for new recruits.
  A new information system will be set up to link up Le Chic with its suppliers and
standardize ordering, payment and accounting processes across restaurants. Also, a
multimedia website will enable customers to access menus, make reservations, post
feedback, download discount vouchers, benefit from promotional events or simply
keep abreast of any development at Le Chic.

 Le Chic will seek opportunities for joint promotional alliances with potential partners
especially those operating in the same areas of the chosen cities. A good example
might be cinemas and local bowling alleys.

 Finally, Le Chic will demonstrate social responsibility by sponsoring community

projects, which can contribute to the development of a strong brand image and a self-
reinforcing cycle of social value, employee engagement, customer loyalty and
enhanced return on investment.

All the owners of Le Chic think that John’s business strategy is very creative and the promise of
bringing profit margins to 15% within 5 years. However, some have expressed their concerns with
regards to the considerable capital outlay that John’s new strategy will require, which, if
unsuccessful, will leave the business potentially bankrupt. To allay these concerns, John has
asked to hire the services of a consultant to help him out with the execution of his new business
strategy.

Coursework Assignment

You are required to step into the shoes of the consultant hired by Le Chic. Your task is to write a
report addressing the key change issues that can have a significant impact on the implementation
of its new business strategy. While practically oriented, your report should draw on appropriate
change theories and models to include the following:

1. An analysis of the change context taking into account both the internal and external drivers for
change. This should include both a PEST and SWOT analysis (please note that the word count
contained within these tables will not be included in the overall word count, so please be as
detailed as necessary). (500)

2. An analysis of the nature of change facing Le Chic using key theory (500).

3. A critical examination of the possible types of employee reactions to the proposed change, again
using the key theory to underpin the discussion and giving consideration to the different types of
employees employed by Le Chic (800 words).

4. Recommendations as to how management should plan and execute the proposed change so as
to ensure its successful implementation using a one of the change models covered in the lectures.
Please also note that this section using the theory should be context specific (700 words).
Your report should include the following the following sections:

 Introduction: 200 words

 Body: 2500 words (accounting for the 4 parts detailed above)

 Conclusion: 300 words

 A list of references (adhering to the APA Referencing Style)

 Appendices (if appropriate).

Word count and Submission Date

As per breakdown above, the report should be around 3000 words long (10% below or above the
limit is acceptable). Please state your word count on the assessment front cover. Please also note
that this assessment accounts for 90% of your final mark.
NB: The report must be referenced following the APA Referencing System and you must
support your arguments and recommendations with academic theory.

Refer to Marking Criteria on next page

Coursework Marking Criteria

Criterion Weighting Merit: 65% and above Pass: 40 – 64% Fail: less than 40%

Neat, legible Neat, legible Untidy and difficult to

Presentation & 10% presentation. Correct presentation. read. Significantly
style spelling. Accurate Occasional spelling poor spelling. Poor
grammar and errors. Mainly grammar and
punctuation. Meaning accurate grammar and punctuation. Meaning
clear and fluid with an punctuation. Coherent unclear. Language
articulate academic meaning and fluent lacks fluency.
writing style. writing style.
Demonstrates sound Demonstrates some Demonstrates little
Evidence of 25% knowledge of an knowledge of a range knowledge of
research and extensive range of of appropriate and appropriate literature.
wider reading appropriate and current literature.
current literature.
Sound understanding Sound understanding Lacks understanding.
Critical analysis 20% of and ability to of theories. Attempts Relies on description.
compare theories. to analyse or take a Inadequate level of
Sophisticated analysis. critical approach to analysis and criticism.
Critical approach to literature.
literature.
All strands of the The argument is The argument is
Coherent and 25% argument are generally consistent inconsistent, and lacks
logical framework consistent and and supported by supporting evidence.
supported by evidence. Conclusions Conclusions are either
evidence. Conclusions are drawn from the not drawn, or cannot
are innovative and evidence presented. be supported by the
convincing. Follows a Follows a logical evidence offered.
logical process. process. Does not follow a
logical process.
Identifies significant Summarises main Fails to summarise
Quality of 10% points from preceding points effectively. No main points.
conclusion discussion. Draws new information Introduces new
together main threads introduced. information.
of argument. Makes a
concluding statement
based on these
arguments. No new
information introduced
Literature is accurately Literature is accurately Literature not
Referencing 10% integrated into the text. integrated into the text. integrated into the text,
All sources Most sources or not used. Sources
acknowledged. APA acknowledged. APA not acknowledged.
citation method used citation method used APA method either
consistently. consistently. very poorly or not
used.