Question:
Discuss About The Features Of Organizational Transformation?
McFarlane teamed up with his new management group in ANZ Bank to develop a program for bringing about organisational transformation that aimed in bringing about a competitive and sustainable advantage for the firm in the long run. The ANZ Bank was suffering immensely owing to the closure of a number of branch outlets with also increases in the fee structure. McFarlane observed that ANZ had retreated from serving the rural communities with also the absence of women in responsible roles along the bank’s hierarchy. The change program initiated by McFarlane was implemented in a rapid fashion through generation of increased cost cutting in large number of branches of ANZ Bank and also in terms of bailing investments along different emerging markets that helped in reducing the risk profile of the bank. Further, McFarlane also focused in restructuring the operations activities of ANZ’s head office by means of streamlining and outsourcing of banking operations and also through generation of large scale reduction of staffs involved in the bank’s headquarters. The change management program brought about by McFarlane potentially contributed in reducing the cost-to-income ratio for ANZ Bank while also enhancing and sustaining the customer and employee satisfaction rates.
Further, the change program of McFarlane also contributed inn shifting the bank’s focus from corporate banking to retail banking such that it started targeting high value retail customers. The initial steps towards organisational transformation were undertaken by McFarlane and his team during 2000 where they focused on enhancing and highlighting the human face of ANZ. The change strategy undertaken by the team were mainly based along three parameters like Perform, Grow and finally Breakout. In terms of Performance, the change program encouraged the bank to not only deliver increased performances but also generate high returns for its shareholders. In terms of Growth, the change program ideally focused on enhancing the potential of bank’s revenues, market leadership and brand image. Finally, in terms of Breakout the change management team aimed in generation of sustainable leadership and also in promoting long-term success for the banking firm (Kouzes & Posner, 2017).
Subsequently the management team at ANZ commissioned McKinsey and Co. for conducting an effective audit of the bank’s cultural parameters. The study conducted by McKinsey revealed potential gaps between the values of bank and personal employee and also the manner in which the employees perceived the banking organisation. The survey reflected a combination of both positive and negative inferences from the employees. Employees observed the existence of bureaucratic and hierarchal elements in the firm and also existence of a silo mentality while also exercising greater control over information and not sharing them with subordinate teams. McFarlane in terms of designing the change program rightly understood that banks are required to generate values based on the inputs rendered by employees and staffs rather than the values interpreted by the visions of the senior management team. Similarly, McFarlane also stressed on the generation of decisions in terms of engaging the inputs provided by the subordinate members of the different departments and also in contributing in the formulation of a shared vision promoting organisational success. The change program designed by McFarlane contributed in benchmarking the performances of the bank with other high performing organisations operating in Australia. The study enabled ANZ determine its areas for improvement and thereby helped in designing a performance and value assessment survey.
Inferences gained from the assessment of value and performance ethic contributed in providing guidelines to the upper management of ANZ for developing and in also effectively undertaking the strategic elements of Perform, Grow and finally Breakout. The Breakout strategy of the Change Management program was considered as the pivotal or the central focus such that it focused on bringing about a cultural transformation in ANZ Bank. This strategy essentially focused in generating newer experiences for the different stakeholder communities of the bank like employees, customers, shareholders and also other members of the different external communities. Further, the Breakout strategy also focused on reducing the element of bureaucracy involved with ANZ’s operations and rather aimed in generating greater freedom to the internal people. The employees were further encouraged for handling greater responsibilities and also in generating effective feedbacks both positive and negative freely to the higher management (Keller & Price, 2011).
McFarlane and his team also contributed in designing a team catered for generating breakout and cultural transformation in the firm. Three major initiatives were undertaken by the breakout and cultural transformation team like designing of breakout based workshops and also in designing charters and consulting for generating Breakout. The Breakout workshops were focused on being designed to promote both emotional and also personal development of the individuals. It encouraged the participants for evaluating their thoughts and values that contribute in driving their behaviours for generating performances, effectively explore the impact of such interactions on workplace standards and also help in developing an understanding of shared interests and values of internal members in actionable terms.
Breakout strategy designed by McFarlane and his team is viewed as an effective charter marketing guides process changes in ANZ for enabling cultural transformation in the banking organisation. The charter also contributes in generating consulting and also diagnostic services for assisting different business units in bringing about necessary cultural changes such that the internal people can both dwell and work in a newly built cultural system. The Breakout Program designed by the team is observed to be operational for a period ranging from two to three days wherein it assists both the subordinates and the management team by providing needed diagnostic tools for effectively probing and understanding the factors that help in duly motivating them and also other stakeholders of the firm. It also contributes in both engaging and in empowering the team members to work in a collaborative fashion for generating effective decisions (Barrett, 2006).
The management team in the organisation was required to generate effective discussion with the internal team members such that the same would be linked with performance assessment programs for helping in tracking and monitoring the annual performances of the employees. Further, employee development programs were also focused on being implemented such that the same was taken to enhance the learning and growth of the people in the firm. The Performance Assessment program undertaken by McFarlane was also taken to be developed in terms of aligning positive reinforcements or rewards with the performance outcomes of the employees. The generation of bonuses to employees in a half-yearly fashion was taken to be generated annually to help in ideal cost savings for the firm. McFarlane and his team also focused on designing a talent development program in the organisation through the integration of the first line and HR managers. The line and HR managers are required to be effectively trained to lead the performance assessment practices of the firm. The quality and effectiveness of the talent management and development programs carried out at ANZ were assessed through the installation of an external assessment team (Keller & Price, 2011).
Similarly, the transformation program carried out by McFarlane and his management team also contributed in designing of a leadership program in the organisation such that which helped in the identification and also development of the leadership potential among the junior managers. ANZ focused on investing in a potential fashion for the development of internal leadership potential in the firm (Kratschmer, 2013).
Managers tend to face increasing challenges in their bid to change the organisational culture. In fact the changes to be brought about in the organisational culture are observed to be more complex in nature compared to endeavouring of generating structural changes in the firms. The mandatory nature of cultural changes to be brought about by the managers makes the employees behave more pessimistically and suspiciously to the changes planned by the management team. The employees being pessimistic and suspicious about the aftermaths of the change process tend to create potential resistances in implementing the transformational changes in the organisation. The employees tend to fear the unknown and always have a feeling of becoming jobless owing to the transformations being introduced in the organisation. The same makes the internal people generate potential resistances (Rutherford, 2011).
Similarly, the internal people adept to an existing culture seems very disinterested in shifting towards a new cultural paradigm. These people tend to reflect a sense of comfort in working along the existing cultures. The resistance to changes reflected by people adept to existing culture can be reduced in that they have a feeling that the existing culture is obsolete and more stereotyped in nature which in turn requires them to desire working in a new cultural setup. Further, employees facing cultural changes required for implementation of transformational strategies also suffer from the fear that working in the new cultural framework would require them to unlearn their present work procedures and styles and rather learn and enhance on their existing skills and expertise for handling of new tools and job processes. The same affects the motivation of the staffs and encourages them to generate potential resistances to cultural changes brought about in the organisation (Kratschmer, 2013).
Again, lack of trust on the business managers involved in planning and bringing about cultural changes for implementing transformational strategies also tends to affect the drive or motive of the people in supporting such changes. The managers involved in bringing about cultural and structural changes in a repetitive and frequent manner make the subordinates feel very tired for facing of continual changes. The same also triggers the employees for generation of due resistances to changes (Nieswandt, 2015).
The attributes of John McFarlane as the CEO of ANZ is observed to rightly resemble that of a transformational leader. As a transformational leader, John McFarlane served in a highly motivated and passionate fashion for generating needed transformation along the internal culture of the banking organisation. McFarlane acted in a highly focused fashion for helping the banking firm gain on needed profitability and returns in the long run. He acted in a very committed fashion for planning the change process in the organisation.
Further, John McFarlane did not fear the taking of risks while focusing on to implement the change process in the organisation. Several cost cutting measures were undertaken by John McFarlane that resulted in severe consequences like removal of excess managerial and other subordinate staffs from the bank’s headquarters and different branches. The result was immense job loss for different individuals. McFarlane undertook the above risk in terms of generating a strong decision which in turn helped in enhancing the margin for ANZ Bank (Schüppel, 2014).
Apart from the above decision another set of strong decisions were also undertaken by Jon McFarlane as is required of a transformational leader. John McFarlane was instrumental in outsourcing and in streamlining the job operations of the headquarters. The same contributed in emptying the staff population involved in the headquarters and contributed in cost cutting and in improving the cost-to-income ratio.
Similarly, John McFarlane as a transformational leader is also observed to focus on motivating and inspiring people to think about new and creative ideas at the workplace. Jon McFarlane focused on the introduction of positive reinforcements like rewarding and recognising the performances of the individuals both managers and staffs inside the organisation. Further, John McFarlane also focused on development of the skills and qualities of the internal leaders through incorporation of coaching programs. The same helped in the sharing of ideas and experiences by staffs and managers in a mutual fashion (Rumley, 2012).
The leadership attributes of Michael Smith as the CEO of ANZ Bank is observed to resemble that of a contingent or situational leader. Smith’s joining as the CEO of the bank made him face potential challenges like difficulty in sourcing money, volatility of the debt and equity markets and also lack of trust of the people on the banks. Smith facing the above situation worked with his managerial team in generating different types of actions like enhancing the capital structure of the bank while also in improving the liquidity situation and in enhancing the balance sheet of the bank. Further, Michael Smith and his team were instrumental in generating needed restructuring in ANZ Bank for improving the customer focus; enhance the level of accountability of the staffs and management to the customers and also in developing a stronger management position. Michael Smith also focused on developing the efficiency of the banking organisation to face future economic emergencies (Hogue, 2013).
The role of leadership in influencing, directing and in managing the change process in ANZ Bank can be largely attributed to the leadership style of John McFarlane for being greatly instrumental in bringing about changes in the organisation.
John McFarlane influenced the transformation or the change to be brought about in the existing culture of ANZ through the generation of the slogan, ‘the bank with the human face’. Further, McFarlane and his team directed the transformational program through the introduction of three sets of strategies like Perform, Grow and Breakout. The Perform Strategy was directed for delivering greater performance for the organisation and in generating greater value to the shareholders. The Growth Strategy was directed for strengthening the potential of the brand and also in augmenting the revenue and leadership position of the organisation. Finally, the Breakout strategy was enabled for promoting long term success and growth of the banking institution. Finally, regarding management of the change process, John McFarlane stressed on rendering a cultural change in the organisation through the effective implementation of the Breakout Strategy. Workshops, Charters and Consulting were developed for rightly implementing and fulfilling the objectives concerning the Breakout Strategy. Further management activity was also concerned regarding the generation of Key Result Areas (KRAs) across different domains like financial, internal and external people and also general communities for evaluating the efficacy of the Breakout Program (Keller & Price, 2011).
The comparison of the cultural dimensions between Poland and Columbia is reflected in terms of Hofstede’s Six Cultural Dimensions as follows.
(Geert Hofstede, n.d.)
Both Poland and Columbia reflect high scores in Power Distance. The same reflects the existence of hierarchal structures within the firm and also centralisation of authority and decision making functions. The subordinates in the organisation are required to follow the directions and guidelines shown by the management and superior authorities.
In terms of individualism and collectivism, Poland reflects the existence of an individualistic culture where individuals focus on gaining their own career growth and development. Promotion is generated on the basis of merit. Colombia on the contrary, reflects the existence of a collectivist culture where individuals focus on working in groups rather than individually. They also like to take care of the needs and expectations of the group workers (Mandal & Vong, 2015).
The culture of both Columbia and Poland reflects existence of a Masculine culture. The masculine character reflects that they are highly ambitious in nature and focus on meeting their achievements. Further, the Columbians and the Polish people are also driven by potential competition and thereby enhances on their expertise for generating greater efficiency in the long run.
Both the Polish and Columbian culture is observed to reflect increased scores of Uncertainty Avoidance. These cultures resist the incorporation of innovation and moving over to untapped markets or segments. They are also interested in sustaining links to their traditional cultures (Binder, 2016).
In terms of long-term orientation, both the Polish and Columbian cultures reflect lower scores. Columbia tends to reflect lower scores than Poland. Increased scores regarding Long-Term Orientation reflect that the organisations focus more on generating and meeting of short-term objectives and are also linked with their tradition.
Finally, in terms of Indulgence, the Polish culture reflects very low scores compared to Columbians. The low indulgence score for Poland reflects that they are less interested in incorporating the elements of leisure and hobby in their working spheres compared to the Columbians. The Columbians are rather interested in integrating the elements associated to leisure and hobby with their day-to-day working activities (Petrakis, 2014).
References
Barrett, R., 2006. Building a Values-driven Organization: A Whole System Approach to Cultural Transformation. New York : Routledge.
Binder, J., 2016. Global Project Management: Communication, Collaboration and Management Across Borders. United Kingdom : CRC press.
Geert Hofstede, n.d. Poland in Comparison to Columbia. [Online] Available at: https://geert-hofstede.com/poland.html [Accessed 13 September 2017].
Hogue, W., 2013. Elements of Leaders of Character: Attributes, Practices, and Principles. United States : WestBowPress.
Keller, S. & Price, C., 2011. Beyond Performance: How Great Organizations Build Ultimate Competitive Advantage. United Kingdom : John Wiley and Sons.
Kouzes, J.M. & Posner, B.Z., 2017. The Leadership Challenge: How to Make Extraordinary Things Happen in Organizations. United Kingdom : John Wiley and Sons.
Kratschmer, P., 2013. Organisational Culture Is Highly Resistant to Change – Discuss. Germany : GRIN Verlag.
Mandal, P. & Vong, J., 2015. Smart Technologies for Smart Nations: Perspectives from the Asia-Pacific Region. United Kingdom : Springer.
Nieswandt, M., 2015. Fast Cultural Change: The Role and Influence of Middle Management. United Kingdom : Springer.
Petrakis, P.E., 2014. Culture, Growth and Economic Policy. United Kingdom : Springer Science & Business Media.
Rumley, D., 2012. Transformational Leadership: The Senior Pastor’s Impact on Church Effectiveness. United States: Lulu.com.
Rutherford, S., 2011. Women’s Work, Men’s Cultures: Overcoming Resistance and Changing Organizational Cultures. United Kingdom : Palgrave Macmillan.
Schüppel, F., 2014. Differences and Similarities between Charismatic and Transformational Leadership. Germany : GRIN Verlag.
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