- 1. Organization Restructuringand Change Management May 23, 2003
Amway Korea Ltd.
2. Table of Contents
- Organization Restructuring &Change Management
For a Better Life Helping People Live Better Lives 3. About
Amway Corp. I Helping People Live Better Lives For a Better Life 4.
TO HELP PEOPLE LIVE BETTER LIVES VISION 5. Amway CorporationAmway
corporation is based in ADA, Michigan, USA In 1959, Jay Van Andel
and Rich DeVos founded the direct-selling companyAmwayAmway is the
biggest direct selling company in the world Amway possesses 380
patent rights as of Mar. 2001, and submitted 430 applications for
the patent right Amway's largest sales come from Korea, Japan,
China, India and Taiwan. 6. 7. Amway KoreaLtd. Amway Korea was
established in 1988,and started its operations in 1991 There are 2
RDC (Regional Distribution Center) and 12 IBO (Independent Business
Owner) Plazas Amway Korea is No. 3 market within Amway Corporation,
and it reached over 1.2 trillion won sales in FY02 There are
300,000 active IBOs in Amway Korea About 400 employees are working
in Amway Korea Ltd. 8. Eumsung RDC Daegu IBO Plaza 9. Amway Korea
Business Process ADA IBOs taking in products at home Home Delivery
Sungnae IP Kayang IP Daejon IP Taegu IP Kwangju IP Pusan IP Cheju
IP (RDC) Ulsan Kangnung IBOs Direct Taking of Amway Products
One-For-One 10. Visit us at http://www.amwaykorea.co.kr 11. Helping
People Live Better Lives For a Better Life II.Organization
Restructuring& Change Management
- 2.Scope and Process : Organization Diagnosis
- 3.Output : Organization Diagnosis
-
- 5.Future Tasks and Direction
12. Organizational Situation 1. Background Need for Change
Decreased Org. Efficiency due to rapid growth (particularly in
terms of org. size)Lowered Managerial Capacity of Mid. Mgmt.due to
considerable increase in headcountLack of Customer-centered Mindset
of Employees due to increased bureaucracy within the org. 13.
Employees Initial Attitude ofthe Project Sensitiveness
Defensiveness Expectation Junior and Senior All Employees Leader
All Employees 1. Background (Contd) 14. To resolve the problems
concerned, 1) in-depth organization diagnosis was conducted 2)
change management tools were utilized toimprove employees readiness
for change 1. Background (Contd) 15. Determination of Issues
Diagnosis & Task Development Action Planningto Strengthen Org.
CapabilityFocus Group Interview (Junior) Main Issues Determined
Focus Group Interview (Senior) FocusGroup Interview (Leader) Exec.
Interview EOS Result Review Tasks Identified External/ Internal
Environment Review Task Development Top Mgt. Workshopto determine
tasks Action Plan Solution Development Phase I Phase II Phase III
Organization Diagnosis Scope and Process 2. Scope and Process :
Org. Diagnosis 16. Change Management Tools
- DevelopBusiness Caseto attract employees attention
- Identify and analyzeKey Stakeholder
- AssessCommunication Channel
Communication Plan 2. Scope and Process : Org. Diagnosis (Contd)
17. 8 16 10 10 18 10 14 14 Priority Tasks 3 3 3 5 Performance Mgmt
System Re-design5 3 5 1 5 3 Urgency 1 1 5 1 5 5 1 Short-Term
Effectiveness 3 Job Analysis 1 3 Manpower StructureRe-design 1 5
Org. Structure Re-design 1 3 Redefining and Sharing of Vision &
Strategy Remarks Easy Implementa-tion Strategic Importance 3 5
Leadership Development 1 3 Communication Effectiveness Planning One
of the 3 main objectives of 2003 3 Succession Planning 3 3 8 Korean
Title Promotion Policy Re-design 5 1 3 3 3
- Each task has been ranked based on their strategic importance,
easy implementation, urgency and short-term effectiveness.
3. Output : Org. Diagnosis 18. Org. StructureRe-design
Succession Planning Leadership Development Performance Mgmt System
Re-designManpower Structure Re-design Job Analysis Implement
Team-Based Org. Structure Korean Title Promotion Policy Re-design
Infrastructure for Change Mgmt Redefining and Sharing of Vision
& Strategy Effective Communication Planning 3. Output : Org.
Diagnosis (Contd) 19. Changes in Employees Attitude after the
Project 3. Output : Org. Diagnosis (Contd)
- Positive attitude of project intention among team leaders
increased
- Employees trust of the top management increased
- Employees expectation of the project increased
- But, lets wait and see attitude still exists especially among
the juniors
- There are still some managers who are not prepared to buythe
project objectives, hence not willing to participate in current
initiatives for change
20. Key Findings
- HRM and HRD are separated; HRD is tied with GA (Usually HRM and
HRD form one HR department; alternatively, each of the three
functions operate independently)
- Despite the increase in number of IBOs, sales function has
remained unchanged.
- Local Sourcing serves as an independent unit, with an executive
as the department head.
Implications & Solutions
- Review HRDs rolesand relocate as necessary.
- Review thecapacity of sales functionin line with the increase
in both revenue and number of IBOs.
- Review Local Sourcings positionin the org., and investigate
potential linkage with other function(s).
- Due to the rapid growth of the org. there exists possibility of
moral hazard, which may lead to need for internal audit
function.
- Review span of control: Sales & MKT, Management
Service
Amway Korea Biz. Relations Marketing Special Event Tech. Reg/QA
RM & GDS Sales & MKT Distribution Logistics Planning CSD
RDC Logistics Finance Treasury HRM GA/HRD ISD Import & Export
Purchasing Local Sourcing Management Service PR & Govt Affair
PR & Govt Affair Legal Affairs BCR & BSM 4. Current Task
21. Change Management Succession Planningbased on the New Org.
Structure Performance Management - Identify future leadership
competency EstablishTraining & DevelopmentPlan based on
succession planning - Leadership Development - Performance
Management & Coaching Skills Training - Executive Development
Program- Customized in-house MBA program Others - Introduce
Cafeteria Benefit Program - Talent Management and Retention -
Develop Total Compensation Strategy 5. Future Tasks and Direction
22. Thank You
