Chapter 8

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Chapter 8: Strategy Implementation as Change Management

Case Scenario
Sappi Limited
Sappi is a global diversified woodfibre company focusing on providing dissolving pulp,

packaging and speciality papers, graphic papers as well as biomaterials and biochemicals to
their direct and indirect customer base across more than 150 countries. Sappi’s vision is
‘Intentional evolution’, we will be a diversified woodfibre group targeting a substantial increase
in our earnings through an expanded product portfolio with increased margins, providing
enhanced rewards to all our stakeholders. Sappi’s mission is ‘Through the power of One Sappi –
committed to collaborating and partnering with stakeholders – we aim to be a trusted and
sustainable organisation with an exciting future in woodfibre.’ The company’s values can be
summarised as acting with integrity, being courageous, making smart decisions and executing
decisions with speed.
Background
Sappi was founded in 1936 in South Africa to serve South African consumers with locally
produced paper. They have a tradition of innovating and developing new products to meet local
demand for newsprint, graphic papers (paper used for communication purposes that includes
printing and writing papers), packaging papers used to protect their customers’ products
(especially in the agricultural sector) and speciality papers used in the convenience food,
confectionery, cosmetic and luxury markets, and tissue paper for household, medical and
industrial use in the Southern Africa region.
©2022 Juta and Company (Pty) Ltd. Practising Strategy: A southern African context 3e
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Sappi is also the world's largest manufacturer of dissolving pulp (DP). DP is bleached wood pulp
or cotton linters that has a high cellulose content. DP is so named since it is not made into
paper but dissolved either in a solvent or by derivatization into a homogeneous solution, which
makes it completely chemically accessible and removes any remaining fibrous structure. Once
dissolved, it can be spun into textile fibers (such as viscose, rayon or Lyocell), or chemically
reacted to produce derivatized celluloses, such as cellulose triacetate, a plastic-like material
formed into fibers or films, or cellulose ethers such as methyl cellulose, used as a thickener. DP
is used worldwide by converters to create viscose fibre for fashionable clothing and textiles,
acetate tow, (which is used, for example, to keep the quality and aroma of cigarettes)
pharmaceutical products as well as a wide range of consumer and household products. Almost
all of the production of their mills in South Africa is exported.
Sappi Southern Africa operates five mills and has a combined production capacity of 102,000
m3 of structural lumber, 690,000 tons of paper, 633,000 tons of paper pulp and over a million
tons of dissolving pulp per annum. The pulp purchased by their European business is effectively
hedged by Sappi Southern Africa being a net seller of pulp.
Strategic Vision for Dissolving Pulp
In 2013, Sappi shifted its South African timber resources into the production of dissolving wood
pulp to meet growing demand for viscose fibre in the Far East, as traditional paper markets
decline. With the recent completion of major expansion and conversion projects at its
Ngodwana and Cloquet mills and the ramp-up of production of dissolving wood pulp, Sappi has
re-positioned itself to take advantage of growing markets for this versatile product.
This strategy is a response to weakening demand around the world for fine paper, which has
resulted in the closure of production lines at Sappi operations in North America, Europe and
South Africa. In Europe alone, demand for fine paper declined by 30 per cent.
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"The group has invested substantial money in South Africa and North America into the
production of specialised cellulose," said Alex Thiel, Sappi SA's CEO at the time. "We need to
move Sappi's traditional paper business into areas of more long term, sustainable growth." He
pointed out that this does not mean that Sappi is walking away from its traditional business of
producing paper pulp and fine paper. "There's limited growth potential for graphics paper, so
we are adjusting our capacity," said Alex. "We supply according to the market demand but
there is no huge growth. We will optimise our production and sustain our market share." Alex
also sees a bright future for the packaging business and Sappi is ramping up production for
packaging grades, which are manufactured at the Tugela and Ngodwana mills, utilising
softwood fibre. "We're the only virgin container board producer in South Africa, and this
business has a great future," said Alex. Sappi is fully committed to this market.
Sappi is the world's biggest producer of dissolving wood pulp, which is marketed under the
name 'Specialised Cellulose’ and enjoys a number of competitive advantages in this market. The
Saiccor mill has been manufacturing dissolving wood pulp since 1955 – it was bought by Sappi
in 1989 – so there is a wealth of expertise and experience at the individual level, both in terms
of production and marketing. Sappi owns extensive plantations in South Africa that are well
suited to growing the hardwood fibre required to supply the mills. Sappi plantations in
KwaZulu-Natal and Mpumalanga are already being converted from softwood to hardwood to
meet the growing demand. The company does not own plantations in North America but has
access to sufficient hardwood timber resources to supply the Cloquet mill with its raw material
requirements.
Sappi's specialised cellulose product is marketed mainly in the East, where it is used to produce
viscose fibre used in the clothing and textile industries. Alex says that Sappi SA has a
competitive advantage through technical expertise as well as economies of scale in that Saiccor
is the biggest single-site producer in the world and the timber supply is close to both the
Saiccor and Ngodwana Mills. There is also a logistical advantage in exporting to the East from
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South Africa, he said. This re-positioning has implications for Sappi's South African forestry
operations.
Once it has reached full production, Ngodwana will require two million tons of timber a year,
900 000 tons of which will be hardwoods. Sappi- Saiccor requires 2,8 million tons a year, all
hardwood. Wattle makes up 10% of this raw material, with Eucalyptus making up the
rest.Sappi's total timber requirements in South Africa are 5.5 million tons a year, 70% of which
comes from its own plantations and the balance from private timber growers, small growers
and community forestry projects. Alex said Sappi had sufficient resources in the ground in
KwaZulu-Natal to provide for the Saiccor expansion, and a surplus of hardwoods for Ngodwana.
Softwood plantations in both regions are being converted to hardwoods to ensure a sustainable
supply of raw material to the mills.
Sappi is also investing significant resources in research and development to improve planting
stock. The company is significantly expanding its clonal programme with the development of
the Clan nursery, so that they can get more of the right trees in the ground, improving
productivity and providing an opportunity to bring costs down. Thus, there will be a big shift in
planting stock over the next few years.
Sappi has strong links with numerous small growers through its Project Grow programme,
which supplies some 2% of its overall fibre requirements. Sappi has also engaged with several
community forestry projects in the Eastern Cape, located within the Saiccor catchment, where
they have established themselves as strategic partners and play a developmental role. They are
already involved with communities with access to 14 000 to 16 000ha, and are targeting 30
000ha in this region over the next 10-15 years.
Around 20% of Sappi's plantation land in South Africa is subject to land claims, which is a
potential threat to the company's access to fibre. However, MD of Sappi Forests at the time,
Hendrik de Jongh, says that they have made a lot of progress with land claims, especially in
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KwaZulu-Natal, where 38 out of 40 claims have been settled. Hendrik says Sappi is strategic and
technical partners with the claimant communities, but stressed that ownership of the land stays
with the communities, with whom they have timber supply agreements. However,
Mpumalanga remains problematic and progress in settling claims has been slow, admits
Hendrik.
The 56% minimum wage increase for forestry workers that came into effect in April 2013 has
inevitably had a big impact on the cost of fibre delivered to the mills. Hendrik said that Sappi
has mechanised 70-75% of its harvesting operations over the past decade, so there are no big
changes in employment anticipated here. But he said that there will be a lot of mechanisation
taking place in silviculture (the growing and cultivation of trees) operations over the next 12-18
months, which will inevitably mean reduced employment opportunities. "A line has been
crossed and it is now imperative to mechanise. There are a lot of jobs that should never have
been done by hand anyway, like de-barking with an axe," said Hendrik. "The only way to survive
in this business is to improve productivity," commented Alex. "The reality is that we need to
deliver value for money, otherwise it won't work."
Alex explained that increasing production of specialised cellulose is a first step into the
development of exciting new markets for Sappi. "There's growing value in timber resources for
packaging materials, while its chemical properties can be used in many different applications.
Cellulose is a sustainable, renewable raw material alternative for a wide range of products. Plus
there's the potential to produce byproducts for energy. We're looking for ways to get more
value from the trees," he concluded.
Sappi's timber resource is already making a huge impact on the company's energy efficiency.
Ngodwana is energy self-sufficient, and is selling energy back into the grid, while Saiccor is 55%
self-sufficient.
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Shift in Strategy Paying Off
In 2017, Sappi’s shift to place more emphasis on dissolving pulp and speciality packaging was
starting to pay off. They managed to improve their European and US businesses. In South
Africa, the paper business experienced a strong recovery in sales volumes. In a move to
reposition the business, CEO at the time Steve Binnie said Sappi would undertake some
measures to keep the business going in a rapidly changing global market. He said the traditional
glossy-paper business represented only one-third of the company while two-thirds consisted of
dissolving wood pulp and speciality packaging. In South Africa, Sappi has set itself growth
ambitions in an economy set to grow no more than 0.8 percent in 2017.
“The short-term goal is to produce 60000 tons in dissolving wood pulp over the next year in
South Africa. We expect to grow that to 300000 tons in the next three years and we are hoping
to increase it to a million tons by 2025,” said Binnie. Sappi reported a marginal rise in sales to
$2.6bn, up from $2.5bn, while headline earnings per share was higher at 33 US cents a share,
up from 31 US cents reported in 2016. The profit came in a $178m, up from $175m a year
earlier.
Sustainability and Impact
Sappi is unlocking the power of renewable resources to meet the needs of the planet and
people while seeding prosperity for all. That’s why they have made the United Nations
Sustainable Development Goals (SDGs) an integral part of their business. The goals define 17
global priorities that challenge all at Sappi to lean in and apply their creativity and innovation to
contribute solutions to challenges – from climate change to poverty.
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Globally, Sappi has identified seven priority SDGs where they believe we can make the biggest
impact. These are the following:
1. Clean water and sanitation. Water is vital to all life, and especially to Sappi’s business.
Water not only nourishes trees but is used to make pulp and paper, generate steam
power and so much more in their mills. That’s why Sappi takes their role as responsible
water stewards in the regions where they live and work so seriously. Sappi’s water
reduction target (to reduce specific water use in water stressed locations by 18 per cent)
focuses especially on their mills in South Africa where they have some of their largest
operations.
2. Affordable and clean energy. As an energy-intensive industry, Sappi’s fuel choices have
a major impact on air emissions. They focus on increasing the share of renewable and
clean energy within their energy consumption, while also continually improving their
energy efficiency. Their target is to increase their share of renewable and clean energy
by 9 percentage points and decrease specific total energy by 5 per cent.
3. Decent work and economic growth. As a responsible business operating in many

locations around the world, this broad goal aligns with their focus on being a
responsible corporate citizen and providing a safe working environment in which their
employees can reach their full potential. Sappi’s targets are, inter alia, to achieve zero
injuries and to increase the proportion of woman in management roles by 3.7
percentage points.
4. Responsible consumption and production. Manufacturing products from renewable

resources is the core of Sappi’s business and central to their commitment to the circular
economy. Through Research &Development, practical innovation and new product
development, they continually create new products, solutions and value from natural
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resources. Their target is to launch 25 products with defined sustainability benefits and
to reduce specific landfilled solid waste by 14 per cent.
5. Climate action. Taking urgent and appropriate actions to combat climate change and its
impacts is a shared responsibility. Sappi is focused on the continued reduction of their
greenhouse gas emissions. Their target is to reduce specific GHG emissions by 17 per
cent.
6. Life on land. With Sappi’s excellence in sustainable forest management and

commitment to stewardship, they want to continue to increase their positive
contribution to healthy landscapes. They practise and promote sustainable forestry
because it ensures clean air and water, protects biodiversity, and defends against
climate change, amongst many other critical benefits. Forest certification validates their
forest management practices and those of their suppliers in the well-managed forests
and plantations from which they source woodfibre. They strive to continually increase
the share of certified woodfibre supplied to their mills. Their target is to have a share of
certified fibre of more than 75 per cent and to increase the enhancement of
biodoversity in conservation areas by 10 per cent.
7. Partnership for goals. While Sappi is already engaged in, and has been contributing to
many partnerships and collaborations, they are looking forward to working more deeply
with others to scale their ambition in pursuit of achieving the Sustainable Development
Goals by 2030.
In South Africa, home to Sappi’s global headquarters, they have selected an additional priority
SDGs that reflect the socio-economic development priorities that reinforce their unique and
longstanding investments in people and local communities in the country. Their target is to
advance their Broad-based Black Economic Empowerment to Level 1.
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Research and development
Sappi is the largest South African Research & Development (R&D) performer in pulp and paper
and the biggest producer of fine paper in the world. Sappi is part of the Gauteng Province
Innovation Hub, where it has a pulp R&D laboratory. Its research center in Kwazulu-Natal
specializes in genetically improved planting stock. Sappi sponsors chairs in forest genomics and
tree pathology at the University of Pretoria. The Tree Protection Cooperative Programme brings
together all forestry companies, Forestry South Africa and the Ministry of Agriculture, Forestry,
and Fisheries. Sappi collaborates on genetically modified breeding with the Forest Molecular
Genetics Programme of the University of Pretoria. The independent, “quasi-public” Institute for
Commercial Forestry Research is supported by contributions from its members and hosts its
own forty-five-person R&D lab.
Sources:
Corporate structure Sappi Group. Available online https://cdn-s3.sappi.com/s3fs-

public/Diagram-Sappi-corporate-structure-Landscape-Standalone.pdf [Accessed 28 September
2021]
Harnessing Public Research for Innovation in the 21st Century. Available online
https://www.cambridge.org/core/books/harnessing-public-research-for-innovation-in-the-
21st-century/south-africa/F85853E0EE44C6D2A8CAEF1148E42498/core-reader [Accessed 29
September 2021]
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More hardwood required as Sappi shifts to dissolving pulp. Available online

https://saforestryonline.co.za/articles/business_profiles/more_hardwood_required_as_sappi_s
hifts_to_dissolving_pulp/ [Accessed 27 September 2021]
New sustainability targets for a thriving world. Available online https://www.sappi.com/new-

sustainability-targets-for-a-thriving-world [Accessed 27 September 2021]
Sappi 2015 sustainability report. Available online https://cdn-s3.sappi.com/s3fs-public/2015-

Sappi-Southern-Africa-Sustainability-Report.pdf [Accessed 28 September 2021]
Sappi’s shift in strategy is paying off. Available online https://www.iol.co.za/business-

report/companies/sappis-shift-in-strategy-is-paying-off-9159533 [Accessed 27 September
2021]
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Multiple-Choice Questions
Question 1
Which of the following statements are correct about the differences between strategy
formation and implementation?
A In the strategy-as-practice approach, strategy formation is the responsibility not only of

senior management, but also of middle and lower levels of management; whereas lower
levels of management are regarded as having the responsibility to implement strategies
B Internal and external forces drive strategy formation, whereas internal, organisational,
and operations-related forces drive strategy implementation
C Strategy implementation is concerned with the overall goals and objectives of the organisation,
whereas strategy formation is concerned with the deliberate choice of a set of activities or steps
needed to achieve strategic goals
D Strategy formation requires strategists to be intuitive with good analytical and

forecasting abilities, whilst strategy implementation requires strategists to have
excellent motivation and leadership skills, in other words, people-related skills
E Strategy implementation follows a top-down approach, whilst strategy formation

follows a bottom-up approach
1 ABCE
2 ABD
3 BDE
4 DE
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Question 2
Strategy implementation follows a bottom-up approach – the execution of activities leads to

the realisation of planned (i) _____; which will realise project goals; project goals will lead to
the realisation of (ii) _____ goals, which will lead to the realisation of the operational, (iii) _____
and ultimately the (iv) _____ goals of the organisation.
1 (i) programme goals; (ii) portfolio; (iii) functional; (iv) overall
2 (i) targets; (ii) medium-term; (iii) tactical; (iv) functional
3 (i) deliverables; (ii) portfolio; (iii) tactical; (iv) strategic
4 (i) deliverables; (ii) activity; (iii) strategic; (iv) functional
Question 3
Which one of the following barriers to successful strategy implementation refers to the link
between an organisation’s strategy and its budget?
1 the people barrier
2 the vision barrier
3 the management barrier
4 the resource barrier
Question 4
Drawing a ______ means that an organisation will specify strategic objectives for each element
of the balanced scorecard, thereby translating its strategy to operational terms.
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1 Gantt chart
2 strategy map
3 project map
4 project schedule
Question 5
A _____ budget enable an organisation to develop entirely new capabilities, reach new
customers and/or new markets, become good corporate citizens or improve existing processes
and capabilities.
1 cash
2 operational
3 strategic
4 short-term
Question 6
In 2017, Microsoft Corporation changed their mission statement to insert artificial intelligence
(AI) for the first time, which fits with the company’s push into AI and retreat from the
smartphone market.
This is an example of _____ for the Microsoft Corporation.
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1 functional change
2 strategic change
3 technological
4 a change in values
Questions 7 to 10
In the following table, Column A lists various types of strategic change, whilst Column B
provides an explanation thereof. Match the type of strategic change in Column A with the
correct explanation in Column B to answer questions 7 to 10.
Column A Column B
Type of strategic change Explanation
7 Evolution (1) 1 Transformational change that is
implemented gradually or
incrementally through interrelated
activities.
8 Revolution (3) 2 Change to realign the organisation
and involves many initiatives
implemented simultaneously with a
‘big bang’.
9 Adaptation (4) 3 Transformational change that is
forced and reactive (a ‘big bang’).
10 Reconstruction (2) 4 Change to realign the way in which
the organisation operates and is
implemented in a series of steps, it
occurs incrementally according to
changing circumstances.
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Question 11
Which one of the following is a best-practice model of planned change?
1 Lewin’s change model
2 Kotter’s eight-step change process
3 Balogun and Hope-Hailey’s change kaleidoscope
4 Hersey and Blanchard’s model
Question 12
Which of the following is/are analytical model/s of planned change?
A Lewin’s change model
B Kotter’s eight-step change process
C Balogun and Hope-Hailey’s change kaleidoscope
D Vroom’s model
1 A
2 AC
3 B
4 CD
Question 13
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Based on (i) _____; model of change, (ii) _____ developed the (iii) _____, which is founded on
the principle that change needs to be context-specific and that the approach to change chosen
should be based on a thorough analysis of the change context and a series of decisions around
the way in which the change is to be managed.
1 (i) Lewin’s; (ii) Balogun and Hope-Hailey; (iii) change kaleidoscope
2 (i) Kotter’s; (ii) Lewin; (iii) unfreezing-changing-freezing model
3 (i) Vroom’s; (ii) Lewin; (iii) unfreezing-changing-freezing model
4 (i) Balogun and Hope-Hailey’s; (ii) Kotter; (iii) analytical change model
Question 14
Which of the following are core segments that determine the context within which change
takes place, according to Balogun and Hope-Hailey?
A power and time
B scope and preservation
C values and integrity
D diversity and readiness
E capability and capacity
1 ABCE
2 ABDE
3 CE
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4 CDE
Questions 15 to 17
Read the Sappi case to answer the following questions based on the Balogun and Hope-Hailey
change kaleidoscope, who argued that those leading change in organisations need to make key
decisions around the way in which the change process will be managed.
Question 15
“In 2013, Sappi shifted its South African timber resources into the production of dissolving wood pulp to
meet growing demand for viscose fibre in the Far East, as traditional paper markets decline .’
This refers to the _____ decision of Sappi and more specifically a/n _____ change.
1 changing path; transformational
2 changing the start point; incremental
3 changing style; transformational
4 changing target; incremental
Question 16
‘We need to move Sappi's traditional paper business into areas of more long term, sustainable
growth’ said the CEO Alex Thiel of the company in 2013.
This refers to the _____ decision, driven by _____.
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1 changing path; middle management
2 changing style; top management
3 changing the start point; senior management
4 changing target; lower management
Question 17
‘Sappi's specialised cellulose product is marketed mainly in the East, where it is used to produce
viscose fibre used in the clothing and textile industries. Alex says that Sappi SA has a
competitive advantage through technical expertise as well as economies of scale in that Saiccor
is the biggest single-site producer in the world and the timber supply is close to both the
Saiccor and Ngodwana Mills. There is also a logistical advantage in exporting to the East from
South Africa, he said. This re-positioning has implications for Sappi's South African forestry
operations.’
This refers to the following decision:
1 changing roles
2 changing path
3 changing style
4 changing target
Question 18
During which step of Lewin’s change model is the following elements critical: Current behaviour
must be carefully examined and employees have to be shown how necessary change is. Second,
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employees must be informed of the imminent change, why it is necessary and what it will
entail.
1 Unfreezing
2 Changing
3 Freezing
4 Sustaining
Question 19
Reasons for the failure of an organisation’s change efforts vary. When performance
management is the reason for the failure, it is categorized as a _____ reason.
1 structural
2 cultural
3 systemic
4 resource
Question 20
Which one of the following does not refer to the way the change process is managed that can
act as a barrier to successful strategic change?
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1 lack of communication
2 poor time management
3 nor dealing with resistance to change
4 failure to devote enough resources to manage, implement and sustain the change
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Essay Questions
Question 1
Define strategy implementation and explain how it differs from strategy formation.
Answer:
Strategy implementation can be defined as the process during which the organisation draws on
both human and non-human factors in the organisation to ensure that its strategy is executed in
line with the plans devised during the strategy formation phase. Strategy implementation is the
action phase of strategic management. Stated differently, strategy implementation is the process
whereby selected strategies are turned into action in order to realise the vision, mission and goals of the
organisation. Therefore, strategy implementation deals primarily with change in the form of translating
organisational strategies into action.
Strategy formation and implementation differ from each other in a number of ways:
• Strategy formation is regarded as the intellectual phase of strategic management, whilst

strategy implementation is the ‘action’ phase.
• Internal and external forces drive strategy formation, whereas strategy implementation is mainly
driven by internal, organisational and operations-related forces.
• Strategy formation requires strategists to be intuitive with good analytical and forecasting
abilities, whilst strategy implementation requires strategists to have excellent motivation and
leadership skills, in other words, people-related skills.
• Strategy formation is regarded as the main responsibility of senior management (although there
is a drive towards wider participation based on the strategy-as-practice approach), whereas
lower levels of management are regarded as having the responsibility to implement strategies.
• Strategy formation is concerned with the overall goals and objectives of the organisation,
whereas strategy implementation is concerned with the deliberate choice of a set of activities or
steps needed to achieve strategic goals.
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Strategy formation follows a top-down approach – strategic goals and plans are developed, that leads to
the development of tactical and operational goals and plans. On the operational level, goals and plans
for portfolios, programs, projects, deliverables and activities are developed. Strategy implementation
follows a bottom-up approach – the execution of activities will lead to the realisation of planned
deliverables, deliverables will realise project goals, the realisation of project goals will lead to the
realisation of programme and portfolio goals. Then, the realisation of portfolio goals will lead to the
realisation of operational, tactical and ultimately strategic goals.
Question 2
Differentiate between the various types of strategic change.
Answer:
• Evolution (transformation; incremental): Evolutionary change refers to transformational change

that is implemented gradually (or incrementally) through inter-related initiatives. This type of
change is likely to be proactive, undertaken in anticipation of the need for future change. These
changes are seen as opportunities for the organisation to improve, for example, project
management techniques that spread with use or improved administrative management
processes. Since there is no pressing need for this type of change, it is often difficult to manage.
• Adaptation (realignment; incremental): Adaptation change refers to change undertaken to
realign the way in which the organisation operates. It is usually implemented in a series of steps.
This type of change is most common in organisations and occurs incrementally according to
changing circumstances.
• Revolution (transformation; ‘big bang’): This refers to transformational change that occurs
through simultaneous initiatives on many aspects. Revolutionary change is usually forced and
reactive because of a changing competitive condition that an organisation is facing such as a
potential takeover that threatens the existence of the organisation. Another example is when an
information technology department fails an audit and immediate changes need to be made.
• Reconstruction (realignment; ‘big bang’): This refers to change undertaken to realign the way in
which the organisation operates with many initiatives implemented simultaneously. This type of
change is usually forced because of a changing competitive position condition that an
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organisation is facing. Reconstruction may involve a good deal of disruption in an organisation.

For example, a turnaround strategy may be implemented, followed by a major structural
adjustment or a major cost-cutting programme may be implemented in reaction to declining
financial performance or changing market conditions.
Question 3
Explain Kotter’s planned model of change.
Answer:
Step 1: Establishing a sense of urgency
This phase requires leaders to establish a need for change and create a sense of urgency around the need
for change. In terms of strategy implementation, not changing would be a threat or a hindrance to the
continued success of the organisation, and employees will have to be convinced of that in order to create
a sense of urgency.
Step 2: Creating the guiding coalition
A guiding coalition is a group of individuals with the requisite knowledge, skills and attitudes to drive the
change in the organisation. This group of people should act as change agents, where a change agent is
defined as a person within an organisation tasked with managing change. One of the key roles of the
guiding coalition is to create and implement a roadmap for change. The coalition should be a good mix
of individuals who complement each other.
Step 3: Developing a change vision
The purpose of this step is to create a compelling vision for change that employees can buy into and that
will mobilise them for change. Ideally, a change vision will emphasise the need for change and the
aspirations of the organisation. Kotter provides guidelines for a good change vision. It should provide a
clear, compelling view of the future – in other words, it should be imaginable; it should appeal to the
long-term interests of stakeholders and accordingly be desirable; it should be feasible, containing
realistic and attainable goals; it should be focused and clear enough to provide guidance in decision
making; and it should be flexible, allowing individual initiative and alternative responses as conditions
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change be easy to communicate and explain. In the strategic management process, determining the
change vision and the broad roadmap for achieving it forms part of the strategy formation process.
Step 4: Communicating the vision for buy-in
Simply telling employees about change is not enough; they need to understand what it entails and why it
is necessary, as well as why it will be beneficial to them. In order to achieve this, the change needs to be
communicated consistently and on every possible platform. One of the most powerful tools in
transmitting the vision is through the behaviours and words of leaders.
Step 5: Empowering broad-based action
The purpose of this step is to ensure that existing and potential barriers to change are removed and that
those responsible for driving change are empowered to do so. Barriers may include structural barriers,
such as systems that are not aligned with the required change, and human barriers, such as resistance to
change or lack of skills.
Step 6: Generating short-term wins
Large-scale change, such as that needed for strategy implementation, can be a long and arduous
process. To keep the enthusiasm and momentum going, it is imperative to show some short-term results.
Kotter suggests that this could take the form of setting performance goals that are aligned with the
change, widely acknowledging and celebrating the attainment of such goals. Such successes are the
generators of future change and success.
Step 7: Sustain acceleration
Given the long timelines and effort required to effect large-scale change, it is vital to ensure that the
change process never stops and that the momentum is maintained. If this step is executed correctly and
the change process is successful, this step will see many spontaneous examples of momentum becoming
visible, such as new projects being initiated, efforts being made to keep urgency levels high, and
employees increasingly being empowered.
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Step 8: Incorporating changes into the culture
The most difficult aspect of change is changing the culture or mindset of the organisation, and this will
take up most of the time. For this reason, it is seen as the last step and not the first step. In order to
inculcate the change in the culture of the organisation, it must become part of the shared values and
beliefs of the organisation. This could be accomplished by the following: proving that the new way is
better than the old way; achieving visible success (for example increased financial performance);
accepting that some people may not accept the change and moving on; reinforcing new norms and
values with incentives, rewards and promotions; and reinforcing the culture with every new employee.
Question 4
Explain Lewin’s analytical model of planned change.
Answer:
Stage 1: Unfreezing
Most individuals will naturally resist change and will be inclined to maintain the status quo (the current
state). For this reason, actively “unfreezing” the status quo and readying the organisation for change is
required. Unfreezing entails two critical elements or steps. First, current behaviours have to be carefully
examined and employees have to be shown how necessary change is, and how the status quo is
hindering organisational growth. Second, employees have to be informed of the imminent change, why it
is necessary, what it will entail and how it will benefit them. During the unfreezing phase,
communication is critical. The more employees know about the change, the better they understand why
it is necessary and how it will affect them, the more they will be motivated to accept the change.
Stage 2: Changing
During this stage, the actual change is taking place, and for that reason (and due to the resistance to
change that will accompany it) it is the most difficult phase of the change process. During this stage,
employees need to start learning the new behaviours required of them, and they require a lot of support.
This phase is characterised by employees acquiring new knowledge, skills and attitudes (for example,
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through training); organisational structures and systems changing; and communication throughout to
maintain the momentum of change by reminding employees why it is necessary and how it will benefit
them.
Stage 3: Freezing
Once the change has been implemented, the challenge is to make it a permanent part of employee
behaviour. It has to be solidified and entrenched in the organisation, and that is why Lewin called this
phase “freezing”. This stage is essential to ensure that employees do not simply revert back to their old
ways of doing things. The change should, therefore, be made part of the performance management and
reward systems of the organisation.
Question 5
Explain Balogun and Hope-Hailey's change kaleidoscope. In your answer, you need to refer to
the eight segments that can be used to divide the context within which change take place. You
also need to explain the key decisions that those leading the change need to make around the
way in which the change process will be managed.
Answer:
The model divides the context within which change is taking place into eight core segments:
1. Power. The organisation needs to determine who the powerful stakeholders in relation to the
change are. This could be, for example, the senior managers, labour union members and leaders,
employees, customers, legislators, or suppliers.
2. Time. The time available to effect the change should be determined. In the event of a crisis, the
range of options is limited, whereas in the case of more available time to implement the change,
the range of options increases.
3. Scope. The extent of the change in terms of its breadth and depth in the organisation should be
determined.
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4. Preservation. The critical things that need to be maintained in the organisation through the
change process and beyond should be identified. This could be, for example, the capabilities of
senior and middle managers.
5. Diversity. The diversity of the organisation should be determined. General dimensions of diversity
are gender, age, marital status, physical ability and language. The diversity of the organisation
will influence the change design.
6. Capability. The capability and experience of the organisation in terms of the management of
change needs to be determined. Should managers be inexperienced, expertise from consultants
may be needed.
7. Capacity. The change process needs time, resources and people to be successful. Therefore, the
organisation needs to determine its capacity in terms of time, people and other resources to
devote to the change process to make it succeed.
8. Readiness. Lastly, the readiness and attitude of those individuals affected by the change need to
be determined.
Based on the analysis of the context of the organisation change, Balogun and Hope-Hailey argued that
those leading the change need to make key decisions around the way in which the change process will be
managed:
i. Change path. The first decision to make is whether the change will be incremental or
transformational. Incremental change refers to small adjustments made towards a targeted end
result. Incremental change does not have a significant impact on existing structures, neither does
it alter current methods. An example of an incremental change is the implementation of a new
computer system to increase efficiency. A transformational change, on the other hand, refers to
a shift in the culture of an organisation, resulting from a change in the underlying strategy and
processes that the organisation has used in the past. Transformational change is designed to be
organisation-wide and it enacted over time.
ii. Change start point. The second decision to make is whether the change will be driven top-down
by senior managers or bottom-up through employee suggestions. In practice, most managed
change programmes are top-down, in other words, initiated and driven by senior managers and
implemented by lower levels of employees.
iii. Change style. This refers to the extent to which the change is coercive or directive versus
participate and collaborative. A coercive style is associated with the phrase ‘do what I say and do
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it now’, which is the opposite of a participate and collaborative change style, where the latter
welcomes input from employees.
iv. Change target. The target or purpose of the change needs to be determined. This can be either
output (such as performance objectives), behaviours (changing the way in which people work),
or values (a change in the core organisational values), or a combination of a change in output,
behaviours and values.
v. Change levers. Change levers refer to those interventions that are deployed in supporting the
management of change. Examples of change levers are organisational structures, control
systems and power structures.
vi. Change roles. The last decision to make is who should be responsible for managing the change in
the organisation. This could be an individual, such as a manager, an external consultant or a
delegated change agent or a team of people.
Page 29 of 31
Essay Questions Based on the Case Study
Question 1
In 2013, Sappi shifted its South African timber resources into the production of dissolving wood
pulp to meet the growing demand for viscose fibre in the Far East, as traditional paper markets
decline.
1.1 What, in your opinion, were the main driver of the decline in traditional paper markets?
Substantiate your answer in no more than 20 words.
Answer:
The main driver for the decline in traditional paper markets is digitization. The more digitized
the world become, the less the demand for paper. This applies to the business and consumer
sectors.
1.2 Draw a strategic map for Sappi’s strategic objective to focus on dissolving pulp,
specifying objectives for each element of Kaplan and Norton’s Balanced Scorecard. In
your answer, you need to clearly indicate each element of the Balanced Scorecard and
at least two appropriate objectives for each element to achieve the strategic objective.
You should also indicate, with arrows, how the achievement of each indicated objective
will lead to the achievement of the next objective.
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Answer:
Reduce costs
Financial Increase profits
Increase revenue in DP market
Improve delivery of customer demands
Customer Decrease costs to manufacturing customers
Expand and convert mills
Internal business Adjust production capacity of DP

processes
Capitalise on technical expertise in production
Improve planting stock
Improve productivity
Decrease costs by clonal programme
Improve responsible leadership
Learning and growth Improve Research and Development
Develop Clan nursery
Improve technical expertise
1.3 Sappi’s vision is indicated as ‘Intentional evolution’. In your opinion, is this an

appropriate vision for the company? Substantiate your answer in no more than 20
words.
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Answer:
Evolutionary change refers to transformational change that is implemented gradually through

interrelated activities. It is likely to be proactive, undertaken in anticipation of the need for
future change. Sappi anticipates a further decline in the demand for traditional paper. For this
reason, they started in 2013 with a new strategic vision for dissolving pulp and to focus on this
market that has more possibilities for growth. Changes made are implemented gradually, for
example by adjusting their capacity for DP market. So, yes ‘Intentional evolution’ is an
appropriate vision for Sappi.

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Page 1 of 31

Chapter 8: Strategy Implementation as Change Management

Sappi is a global diversified woodfibre company focusing on providing dissolving pulp,

Strategic Vision for Dissolving Pulp

Shift in Strategy Paying Off

Sustainability and Impact

3. Decent work and economic growth. As a responsible business operating in many

4. Responsible consumption and production. Manufacturing products from renewable

6. Life on land. With Sappi’s excellence in sustainable forest management and

Research and development

Corporate structure Sappi Group. Available online https://cdn-s3.sappi.com/s3fs-

More hardwood required as Sappi shifts to dissolving pulp. Available online

New sustainability targets for a thriving world. Available online https://www.sappi.com/new-

Sappi 2015 sustainability report. Available online https://cdn-s3.sappi.com/s3fs-public/2015-

Sappi’s shift in strategy is paying off. Available online https://www.iol.co.za/business-

A In the strategy-as-practice approach, strategy formation is the responsibility not only of

D Strategy formation requires strategists to be intuitive with good analytical and

E Strategy implementation follows a top-down approach, whilst strategy formation

Strategy implementation follows a bottom-up approach – the execution of activities leads to

1 (i) programme goals; (ii) portfolio; (iii) functional; (iv) overall

2 (i) targets; (ii) medium-term; (iii) tactical; (iv) functional

3 (i) deliverables; (ii) portfolio; (iii) tactical; (iv) strategic

4 (i) deliverables; (ii) activity; (iii) strategic; (iv) functional

1 the people barrier

2 the vision barrier

3 the management barrier

4 the resource barrier

This is an example of _____ for the Microsoft Corporation.

Which one of the following is a best-practice model of planned change?

1 Lewin’s change model

2 Kotter’s eight-step change process

3 Balogun and Hope-Hailey’s change kaleidoscope

4 Hersey and Blanchard’s model

Which of the following is/are analytical model/s of planned change?

A Lewin’s change model

B Kotter’s eight-step change process

C Balogun and Hope-Hailey’s change kaleidoscope

1 (i) Lewin’s; (ii) Balogun and Hope-Hailey; (iii) change kaleidoscope

2 (i) Kotter’s; (ii) Lewin; (iii) unfreezing-changing-freezing model

3 (i) Vroom’s; (ii) Lewin; (iii) unfreezing-changing-freezing model

A power and time

B scope and preservation

C values and integrity

D diversity and readiness

E capability and capacity

1 changing path; transformational

2 changing the start point; incremental

3 changing style; transformational

4 changing target; incremental

This refers to the _____ decision, driven by _____.

1 changing path; middle management

2 changing style; top management

3 changing the start point; senior management

4 changing target; lower management

This refers to the following decision:

2 poor time management

3 nor dealing with resistance to change

• Strategy formation is regarded as the intellectual phase of strategic management, whilst

Differentiate between the various types of strategic change.

This refers to the _ decision, driven by _.