Implementation of a visual management system in a purchasing organization: Analysis through a change management perspective

Abstract

The thesis project was conducted in Mojo purchasing department, which is a pseudo name for a big organization in Sweden. Mojo implemented a new way of tracking its performance, which has resulted in a ‘hockey stick-effect’ and showing a stronger result in the third and fourth quarter. As a result of this effect, the profit and loss contribution of Mojo’s purchasing department was uneven and did not match the financial calendar. This means that a lot of the savings for the organization is made in the third and fourth quarters. The current situation has prompted an increased focus on profit and loss to allow savings to be evenly distributed throughout the year. Furthermore, the department is not achieving its financial target because of unreliable forecast. As a result of the above-mentioned challenges, Mojo’s purchasing department has launched a visual management system where an online software known as iObeya is used to show a clear visibility of where the purchasing department stand compared to its target in order to improve its performance. The purpose of the thesis is to analyze the implementation of the visual management system at Mojo’s purchasing department. It will examine it through the lens of organizational change. It will do so by attempting to uncover how several factors that have been shown to affect organizational change, has been considered by the change implementers at Mojo. Furthermore, it will examine how these factors were perceived to be taken into account by the employees affected by the change implementation.

The thesis finds that while most of the employees at Mojo are satisfied in seeing their activities visually, there are some areas of the change that could be improved to secure commitment from employees. It highlights the importance of change leaders to not only concentrate on the macro level perspective of change but also the micro level perspective such as employee’s psychological factors which affect their commitment, openness and readiness for the change. Finally, based on the findings, the thesis will recommend improvement ideas that Mojo should consider when implementing a similar project in the future. These recommendations could also be adapted to the ongoing change process at Mojo.