Multinational companies

Answer

Introduction

        Multinational companies are found in many developed countries. They are associated with the selling of products in more than one country. Apart from developed countries, multinational companies are also found in developing countries whereby they operate in a given region associated with several countries. Some of the countries that are mostly associated with multinational corporations include the United States of America, England, China, Canada and even Australia. In this case, we are going to focus on a multinational corporation in China.

       Sinopec is one of the largest oil refining companies in the world, with its headquarters in Beijing. The company has been able to undergo transformational change over the past 5 years, something that has enabled it to adapt certain practices while ignoring or abandoning others. Sinopec competes with other global giants in the process of oil refinery. In regard to revenue accumulation, Sinopec is the third company globally. Just like other big companies, Sinopec is associated with leadership as well as management. The leader of the company is Chinese by the name Dai Houliang. Dai came into the leadership position of Sinopec in the year 1997, whereby he was the vice chairman of the company. Over the years, he proved to be worth his leadership, something that enabled him to rise to the top position easily. The vice chairman of the company is Li Yunpeng, who has also operated in the company since 1998. There has been a change in strategy within the organization that has ensured that the company meets the demands of some of the individuals who are associated with it (Downs, 2008).

PART A

         Transactional leadership is the leadership that is mainly associated with supervision, performance and organization. This type of leadership has been associated with the chairman of Sinopec, Dai Houliang. Supervision, the overall performance and the organization of the employees is something that is key to the establishment of effective performance in the company. This is the reason as to why transactional leadership has been adopted by the company. Dai Houliang, through the use of assistants and supervisors, ensures that the activities within the organization are well monitored to ensure that there are no possible errors that could have been avoided. He has ensured a strategical change that caters to the requirements of the given employees who are associated with creating a bond between employees and the executive. The needs of the employees have also become a priority for Dai Houliang, considering that he argues that the employees highly determine the overall performance of Sinopec. Competitiveness is also another aspect that is highly associated with transactional leadership. It is because it is highly associated with performance (Pieterse et al., 2010).

       For example, in September this year, Dai assured that the company was ready to adhere to the restructuring policies that have been set by the government. It is so obvious that the government of China aims at helping the many organizations that are in the country since they contribute to a lot of the revenue that is collected from the organizations. It means that most companies will rely on the restructuring policies that have been set by the government for improved performance. It, therefore, means that if Sinopec does not apply the same policies, then it will face unhealthy competition from other related organizations. However, with the integration of the policies, then it is clear that competition will be enhanced within the organization.

       Transformational leadership is whereby a leader associates himself/herself with available teams or even groups that are specialised in different areas. Transformational leadership does not highly advocate for employees or even the individuals forming the executive making independent decisions. It advocates for teamwork, something that has been ensured in Sinopec Company. This has been associated with the leader of the organization, Dai Haulian. For example, in March 2017, Dai, the leader of the organization, was able to sit with a team of some of the employees in different departments within the company. What was established was the decision on whether the overall oil refining in the company would be increased or decreased. However, it was decided that the overall oil refining be maintained in order to cut off the additional costs that could be associated with the implementation of strategies that could increase the overall oil refining. This just shows how Sinopec, with the help of its leader, has been able to carry out or perform transformational leadership (Harms and Crede, 2010).

        As seen above, the leader has been able to incorporate transformational leadership whereby he makes decisions based on agreements that have been made in particular teams. The use of teams by the organization can be seen in various ways, such as the one mentioned above. Still, in March, the company had to make a decision on whether to raise the fuel prices or not to raise them. Had Dai made the decision alone, then maybe he could have come up with the wrong decisions that could lead to the company not doing well. However, the incorporation of various departments to form a team helped Dai in making the right decision. Through the use of individuals from departments such as the finance department and the human resource department, Dai was able to establish that there was the need to raise the fuel prices. It was established that the raising of prices could help in covering for the costs that are associated with the production of fuel.

        Transactional leadership in the organization can also be proven through various practices by the leader of the company. Dai is a leader who has always ensured that he checks on the progress of the company regarding its general performance. He has been able to observe the behaviour of the employees that are associated with the company, hence getting to monitor the general performance of the company. This is a form of transactional leadership. Dai has also been able to come up with individuals who look into the progress of the organization, as well as respond accordingly and report to him. The supervisors are also associated with ensuring that the concerns of the employees are well addressed to ensure that they do not feel left out. This shows how Dai, the leader of the company, has been able to inculcate good supervision, hence ensuring that transactional leadership is well integrated. For example, with the help of a team, as seen above, he has been able to conclude that with the rising of prices, it will be easy to compensate for the additional costs, hence ensuring that profits are still maximised. All these demonstrations can be used to show how the leader of the company has been able to apply the two important forms of leadership which include both transformational and transactional.

      As seen, strategical change is the most common form of change that is likely to be associated with the company. One of the ways through which Sinopec can achieve this is through changing the way it markets its products or advertises them. Marketing is one of the things that determine the overall performance of organizations. In most cases, marketing ensures that a company becomes well known to the potential customers. Various departments within companies should be included when coming up with the best marketing strategies. For example, a team can be established, that is made up of various individuals from the different departments. Each member of the team can be allowed to come up with various opinions, after which the opinion that counts the most is implemented. This shows how transformational leadership can help in ensuring strategical change through advertisements. Project management is also another means through which strategical change can be observed in companies. Project management requires the integration of the best personnel to ensure that decisions are made accordingly. For project management to become a success, then a board of management is required within companies. A good board of management should be composed of the top leaders or the executive of the company. Investors and potential investors should also be included in a good board of management. Looking at that, then it is clear that a board is made up of various individuals that are associated with decision making. This also shows another way through which transformational leadership can be effected by companies such as Sinopec.

       As seen earlier, transactional leadership is the one that is associated with supervision and performance. This means that transactional leadership takes place in many organizations and is carried out by many leaders simply because most leaders are associated with supervision and knowing the general performance of organizations. Marketing and product management is the strategical changes that have been identified within the company. They can both be associated with transactional leadership. To start with, marketing requires good marketers or rather a good group of individuals for implementation. It is good for leaders to always look into the policies that are being put in place to ensure that marketing turns out to be effective. Even with a board of management, it is always good to supervise the personnel that is associated with marketing within companies. This creates a sense of responsibility among the employees, hence helping to improve the marketing strategies. Product management is another strategical change associated with Sinopec. With good product management, then it means that companies can rely on their products for the best sales. Good product management helps in ensuring that a company performs effectively. It, therefore, implies that good product management can be used to determine the performance of companies. Leaders are able to know how their companies perform just by looking at how the body associated with product management performs. This is also another means through which transactional leadership comes into play. In most cases, it has been easy to know the performance of companies by looking at how the companies operate through their boards or through their management. This has not stopped in many companies, meaning that it is the most effective way of knowing how companies perform.

PART B

        Incremental change is the change that results from small processes or small activities that eventually lead to an end result. Small adjustments are done within an organization, which determine the end result. Radical change, on the other hand, is the immediate shift that occurs due to the activities that are involved in an organization. Incremental change is hence associated with minor adjustments that eventually lead to a desirable end result. Looking at the case of Sinopec, it is clear that the company has experienced incremental change especially with regard to prices. The prices of the products produced by the company have been adjusted over the time to come up with prices that are suitable to both the company and the customers. The prices of the products have to adhere to the pricing policy that has been set by the government. Radical changes in the company have especially occurred in the case of marketing, in this case using advertisements. For example, it has become necessary to adjust for some of the advertisements that have been integrated into the organization. It has become important to come up with the best advertisements through discussions that have been made by the board of management associated with Sinopec. An incremental change in the company can help in the realization of the most suitable prices, while a radical change can help in avoiding possible emergencies within organizations.

     Changes in prices and product management changes are some of the changes that are associated with Sinopec. The changes in the prices can be said to be incremental changes since it takes time. A certain span of time is used when prices change. This hence makes the changes in prices to be incremental. On the other hand, changes in product management can result in the coming up of immediate ideas within the organization, hence calling for a radical change. A radical change cannot be implemented gradually. First, it is necessary to know that radical changes occur immediately, unlike incremental changes which can occur during a certain period of time until what is desired is achieved.

PART C

       The impact of change on companies can be identified through various methods. The impact of change can be determined by the overall performance or output, the number of new customers or even the achieved level of profit maximization. Determining the impact of change at the individual level is something very easy and achievable. For example, the supervisors who report to the chairman bring with them useful information regarding what the other employees in the company think and are doing. This can be something that helps the leaders to know what is associated with the employees, hence acting accordingly and knowing them at personal levels.

        The steps that can be used by the leadership in the company to manage the impact of change also need to be well understood. The leader should be able to know the concerns of the individuals involved. He can do that by knowing the response of the employees regarding the implementation of a certain change. Another step that can be used by a leader to know the effectiveness of change on the people is through going through past records of what the company was able to achieve even before the change was implemented. Through the implementation of these, the steps to manage the impact of change can be well adhered to.

        There are several barriers that can bar the leader from implementing the changes mentioned. The first one includes possible corruption, which the leader cannot tolerate in the mall. Corruption has barred very many leaders from carrying out their implementations, although it is believed that China is not associated with corruption. Another barrier is the lack of a board of management to help the leader in coming up with the right decisions. Language barrier can also be a barrier that bars the leader from implementing changes. For example, not all individuals working as employees speak the same language, hence this acts as a barrier towards the leader in implementing the strategies.

        Some strategies can, however, be employed to avoid all these mentioned barriers. In the case of corruption, the Company should come up with rules and regulations that are tough to ensure that corruption does not take place in the country. Corrupt individuals can also be subjected to a court of law. Language barrier in the company can be achieved when the employees within the company are taught Chinese. It is important that the employees who cannot speak Chinese be taught the language in order to blend well with the rest within the Company. A board of management can be established in order to avoid the problem of making poor decisions. Boards of management have never proven to be unhealthy in any case. Since most of the individuals that make up the boards directly depend on the company for potential profits, then it becomes hard for such a board to help in making the wrong decisions.

PART D

        Appreciative inquiry can be used to manage change through the use and the follow up of the steps involved accordingly. The steps should be associated with a corresponding activity that ensures that change is managed. As known, appreciative inquiry includes Discovering, Dreaming, Designing and Destiny. In discovering, strengths of particular practices are identified, as well as the capabilities. For example, in the case of rising prices, the strengths associated with doing that should be established. For example, in this case, the strengths are due to the fact that the high prices will be able to cover for the incurred costs. In dreams, it is important to come up with a vision that is associated with implementing some strategies such as raising the prices. For example, the vision of the company would be associated with growth, something which makes it easy to come up with goal-oriented decisions. Designing involves looking for a way through which the identified discovery will be put in place. For example, it would be good for the head of the financial department to design the means through which the adjusted prices could be implemented. Destiny, on the other hand, helps a company to know what its aims and goals are, hence maintain them.

     The Kotter’s 8-stage change model can be useful in a number of ways, especially after looking into the stages involved. The first stage is the creation of a sense of urgency (Kotter 2008). As seen earlier, there was the need for change in product management. The urgency, in this case, would be the fact that with poor products, then customers might end up losing the taste for the products produced. The second stage is the building of an effective coalition. For product management to be achieved, then several individuals have to be involved, for example in this the board of management. The creation of a vision comes third. For example, in Sinopec, a vision would help in the production of the best products since the company wants to achieve the best even in the future. Coming up with volunteers is the fourth stage. This stage can be associated with the change in advertising, whereby volunteers could help in the marketing of the produced products. The fifth step involves the removal of possible barriers, whereby anything that might act as an obstruction towards the achievement of goals is done away with. In the case of Sinopec, it would be wise to do away with unnecessary products to ensure that product management is effective. The sixth stage involves ensuring that some positivity is realised from the stage. The seventh step is sustaining acceleration, whereby there is no stopping whatever had already been started. For example, product management within Sinopec should be ensured throughout. The eighth and the final step is institute change, where the actual change is now implemented. In Sinopec, new products are introduced in the market that are packaged differently.