Analysis of Change Management Impact at Veritiv Corporation

Analysis of Change Management Impact at Veritiv Corporation

Mark Mitchell

HRM 531

November 7, 2016

Rachelle Tanega

Change Management Impact at Veritiv Corporation

To better understand the impact that change management has on a business one clearly identify what is change management. Change management is a systematized approach to making changes within a company where these changes are efficiently and thoroughly put into operation, and that the desired result of the modification is achieved and provide a lasting benefit (Mind Tools Ltd, 2016). In this analysis, the purpose of the change will be explained and discussed. Likewise, the methods of change implementation will be determined and reviewed. Additionally, budget concerns, the timeline, and the metrics of success will be considered and discussed. After which, a recommendation in regards to a follow-up plan to review the change's impact on the human resource function, any additional personal required, the organizational alignment and changes to costs we be analyzed and discussed.  

Purpose of Change

There is only one real constant, and that is the inevitability of change; in both business and personal situations. As for the essential purpose of change at Veritiv Corporation the change was twofold; first, its design was to increase the company market footprint in regions that it was deficient and thereby boost profitability. Secondly, to create one of North America's largest business to business suppliers of paper products that are utilized in several different markets combining the best of both companies. These markets include the print industry, packaging, facilities supplies, manufacturing, product design and food processing.

Change Implementation Process

The change implantation process officially began in January of 2016 as a merger was announced between International Paper’s distribution service business, Xpedx and its direct competitor in the distribution industry, Unisource Worldwide Incorporated (Fox, 2014). However, both International Paper and Unisource revealed that they have entered into talks of a potential merger of both distribution businesses into a new independent publically traded company with a preponderance of independent directors (Couret, 2013). Two key players in the change implantation process were Mary Laschinger, former Xpedx President and International Paper senior vice president and Allan Dragone, Unisource World wide’s former president and CEO,. Once the merger was completed, Mary Laschinger became the CEO of Veritiv and its board of director’s chairman. While Allan Dragone serves as one of the director of Veritiv and his duties are to be an adviser on activities of integration (Printing Impressions, 2014).

Since, the merger the companies much of the changes are now focused on allocation human resources throughout the company; which entails the combining or removing of duplicate departments and reduction of company property; such as trucks trailers, warehouse machinery and buildings and facilities within the organization. These locations are located throughout North America, such as the Great Lakes Region, which includes the states of Ohio, Michigan, Wisconsin, Indiana, and Illinois. Likewise, the executive offices are located in the greater Atlanta Georgia area and will operate the two subsisting center of operations of the two merged companies (Printing Impressions, 2014).

Budget Concerns

To generated funding and refinance the existing debt of Unisource, Veritiv entered into an obligation with three different banks to acquire 1.4 billion dollars of resource-backed funding (Printing Impressions, 2014). Veritiv’s objective debt-to- earnings before interest depreciation and amortization (EBITDA) ratio is projected to be in the scope of 4-5 (Printing Impressions, 2014). Therefore, Veritiv will be efficiently situated to produce a strong operational cash flow to allow reinvestment in the company while effectively paying down its debt (Printing Impressions, 2014).

The analysis of this change management impact focused on the facilities located in Michigan and it has seen many office sectors personal; Such as the payroll and human resource departments, either transferred to other locations or offered buyouts to reduce unit size and labor costs. Additionally, warehouse locations are being consolidated into the central warehousing facility in Livonia Michigan, reducing unnecessary outlying warehouse buildings; but also a reduction in duplicated delivery routes and additional drivers along with the costs of conducting business; both fixed and variable. Similarity, a secondary focus is on upgrading product tracking software to a bar coding system to control inventories and products movement both inbound from suppliers and paper mills to outbound to the company's customer base.