Academic journal article
By Santhidran, Sinnappan; Chandran, V. G. R.; Borromeo, Junbo
Journal of Business Economics and Management , Vol. 14, No. 2
Organizational change has been an issue of growing interest among scholars and practitioners (Armenakis, Bedeian 1999; Pettigrew et al. 2001; Burnes 2004; Whitely, A., Whitely, J. 2007). For Asian companies striving to become world leaders, change is imperative to achieve success in the globalized world that is attributed with stiff competition from both developed nations, and emerging economies such as China and India. Therefore, in many developing countries major organizational change is required to compete in this globalized world. Indeed, in Malaysia, emphasis on low cost labor advantage in sustaining competitiveness is less relevant nowadays. Competitiveness requires major organizational changes especially in the way organizations manage market and demand, innovative capability, technological change and rapid changes in many other aspects of a dynamic environment (Markovic 2008). All these efforts require organizations to make changes to their current operations and businesses including structure, processes, culture, vision and mission (Armenakis et al. 1993). However, many of these change efforts are unsuccessful (Kotter 1995; Judge, Douglas 2009) due to numerous factors that might have different degrees of influence in different contexts, e.g. different countries. Among these, issues of leadership, readiness and commitment to change are perceived to be important (Eisenbach et al. 1999; Armenakis et al. 1993). To date, despite the relevance of understanding change, the issues are largely neglected in Asia (1). Empirical research on organizational change in the context of Asian countries is lacking, thus limiting any possible insights for managers and practitioners in Asia to rely on as a guide for management practice (Bruton, Lau 2008). Indeed, research tends to agree that evidence from the more stable environments, from the developed countries, can underestimate the relevant success of change efforts in developing countries (Chiaburu 2006). Owing to the differences in the cultural context, the validity of the previously established models and theories need to be empirically tested in the context of Asia. Consequently, the complexity of the relationship is less explored to provide sufficient understanding on how the variables affect each other, e.g., link between leadership and change process (Almaraz 1994; Eisenbach et al. 1999). Untangling this complex relationship helps provide sound managerial practice to improve the success of any change efforts. This indeed is expected to provide insights and lessons, both practical and managerial, on the relevance of leadership, change readiness and commitment to change that could limit transformation initiatives in developing countries. However, despite analyzing various aspects of change, to date there is no conclusive research that focuses on the interrelationship between leadership, change readiness and commitment to change.
Our objectives in this study were to examine employees' perceptions on readiness to change, commitment and leadership during transformation initiatives. We examine the fit between leadership, readiness and commitment. We attempt to answer the following questions: (i) how does transformational leadership affect change readiness? (ii) is there any relationship between change readiness and commitment to change? And (iii) is the effect of leadership on commitment to change direct or indirect? Therefore, this paper tends to provide conclusions to one of the key questions on the complexity of the relationship between leadership, change readiness and commitment to change. However, in doing so, we also made strategic decisions that involved tradeoffs (Kristof-Brown et al. 2005) that consequently affect the generalization of the findings (2). The strategic decisions involved deciding whether the survey should be administrated on a population of organizations or to take a case study approach by involving only a single organization. …