Introduction
The realities of today’s economic conditions are based on meeting the constantly changing needs of customers, increasing labor productivity, and maintaining a leading position in the market. A commercial organization is a social system that develops according to business principles, but production capacities and a management system act as driving forces. As a result of the mismatch, a crisis arises, leading either to stagnation and the loss of competitive advantages or to a radical restructuring of the management system and the opening of new horizons.
Drivers of Change
It is necessary to highlight what makes the bank introduce innovations. Firstly, it is the culture and structure of the company, and secondly, there are competitiveness and authority of the corporation in the common market. ANZ Bank is going through a stage that determines the need for the firm to adapt quickly to the ongoing changes. The need for transformation is also determined by the life cycle of any company when organizational activity ceases to correspond to the scale of its activities (Ramage & Shipp, 2020). Consequently, the need to manage the process of change in the corporation becomes apparent. An idea arises about the need to have a change management toolkit.
In order for the proposed changes to be effective, the bank has to go through several stages. First, it is essential to realize the need to initiate changes based on an early analysis of the processes taking place in the market and inside the company (Ramage & Shipp, 2020). This option is most attractive because the bank can implement a whole range of changes in the organization of the corporation in advance (Bátiz-Lazo, 2018). Change management becomes active, and the transformation program is associated with a smaller cost while having the greatest effect (Bátiz-Lazo, 2018). Secondly, the identification of the problem of loss of efficiency and the need for changes is also possible based on the results of the deterioration of the organization’s performance indicators. This deterioration means that unfavorable external factors have already begun to act, and it is necessary to respond urgently to this circumstance. In this case, it is important to determine the length of the time period during which the efficiency can be kept from a catastrophic decline; this change management is called passive (Bátiz-Lazo, 2018). Third, setting goals and formulating a strategy is one of the essential steps of novation.
Finally, the organization’s management needed to implement tools to maintain the established vector of innovations. It is necessary to ensure control over the implementation of changes due to the high degree of uncertainty in the development of events associated with organizational changes. The problem is that it is impossible to do without trial and error in the development, selection, and implementation of innovations. This feature of the change management process imposes special requirements for the implementation of the control function, which can be based on minimizing deviations and controlling change management.
Diagnosis Framework Model
Groups that enter the orbit of changes are faced with the fact that informal connections, communication channels, and behavioral stereotypes are becoming different, but these processes are complicated. Such resistance from individuals and groups can be a powerful deterrent. Change management can be accomplished by diagnosing and balancing the forces that drive or hinder novation (Powell, 2019). It should be emphasized that it is Lewin’s model that is most appropriate, using several aspects of the overall structure of the organization (Powell, 2019). For the bank in question and its activities, this is most applicable, especially in the context of the specifics of the organization, which will be discussed below.
There are a lot of diagnosis framework models, but Lewin’s is the most effective. A “force field” is an analysis of the factors or forces that push, facilitate or inhibit change. It is assumed that in any situation, two groups of forces are at work: promoting and counteracting changes and driving and restraining forces (Crosby, 2020). To implement change, individuals need to assess the resistance and try to change this balance in their favor. Achieving change is nothing more than moving the balance line toward a goal. This can be achieved by strengthening or adding driving forces, reducing or removing restraining forces, or a combination of these measures.
Such situations reflect the perception of forces by people affected by the change. For example, layoffs may not be the intentions of change initiators, but if staff believe the change will lead to redundancies, a deterrent will emerge. If the driving forces outweigh the restraining forces, the planned changes can be achieved (Crosby, 2020). Thus, the change management process consists of timely diagnostics of the force field and planning actions to manage the balance of power. According to the three stages model, there are two main opposing groups, driving and restraining forces (Crosby, 2020). Specifically, employees with sufficient baggage of intellectual capital and those who are not burdened with it and are not trying to find it.
Structure and Culture
The structure and culture of the bank stand out separately because they have their own specifics. The fact is that for any bank, and in particular, for the one under consideration, a toxic culture is characteristic, the essence of which is both in the harsh behavior of people and in a commercial environment (Ferguson, 2019). It is important to note that such social problems are often counterproductive, which complicates not only the activities of the organization but also the implementation of new processes, in particular, innovative ones (Ferguson, 2019). This can be explained by the reluctance and relative inflexibility of the structure, which directly follows from the prevailing culture, which, as it were, condemns any changes (Ferguson, 2019). As a result, it is necessary to highlight one of the main goals of the innovations, the elimination or reduction of the level of toxicity.
Resistance to Change, Leadership, Management, and Communication
One of the most important factors that will slow down the implementation of such changes in the organization is the resistance to change on the part of the employees of the company, who are financially deprived of the introduction of a differentiated wage system (Lehman, 2019). Already in a first approximation, this small grouping allows us to find out which groups, individuals, or factors will act as forces of resistance to change and for what reasons. Reasons for resistance to change:
- Selfish interest of employees. Certain part of employees comes to the expectation of personal losses due to the transition to a differentiated remuneration system, and the positive consequences of innovations for the organization as a whole are not an argument for them (Lehman, 2019). This is due to a certain amount of selfishness inherent in people who tend to put their personal interests above, for example, collective ones.
- Misunderstanding of goals and strategies for change. The basis for such processes can be a low degree of personnel confidence in managers promoting a plan for any changes (Lehman, 2019). In the future, this leads to the emergence of various speculations and rumors that are reflected in the organizational culture of the company.
- Different assessments of the consequences of the implementation of the strategy. This problem follows from the previous reason and is its consequence and is the result of the inadequate perception of plans and the existence of other sources of information (Powell, 2019). An extreme form of manifestation of this process can be open disagreement among employees.
- Lack of legal framework in the field of intellectual property rights protection. Formally, such a basis exists in the form of a constitution, civil and other codes. But, as a rule, for most employers, especially in private, small organizations, this is not a significant obstacle to the infringement of intellectual property rights (OECD, 2020). This is facilitated by numerous gaps, pitfalls, and ambiguous wording in the legislation itself.
Despite the fact that there are many social and cultural issues in the banking environment, it is worth highlighting the virtues in the form of leadership and communication. A banking institution is primarily associated with cash flows, where, due to the specifics, lightning speed and communication skills are required (OECD, 2020). This phenomenon can be explained by the fact that with a low level of interconnection of elements of a single structure, the organization simply could not compete with its opponents. An important remark here is that in organizations like the bank in question, communication cannot function fully without a leader and control (Ferguson, 2019). Nevertheless, the successes proved by the bank in this area show that these aspects of the corporation do not need to be improved. Based on the information on the turnover and the number of general directors, top managers, and other key persons, it is concluded that there is no stagnation either.
Recommendations
Despite the ambiguity of assessments of the overall activity of the bank, it should be noted that the structure and process of introducing innovations require a number of recommendations. Thus, one of the most important remarks is the lack of significant weight of the opinion of employees in the context of a toxic culture. It is assumed that this aspect has several paths that are the same in efficiency but differ in time (Lalchandani, 2020). The first decision is to consider the introduction of tools and personnel changes aimed at reducing overall toxicity and rejection of innovation. In this case, the process will take a long time and will be successful only in the long term (Lalchandani, 2020). The second step is to personalize and take into account the opinions of employees, highlighting wishes and complaints outside the context of a toxic culture. It is important to add that the second way does not solve the problem of culture but bypasses it. In this case, the cultural phenomenon will have to be dealt with separately, but listening to workers is also an indirect tool to reduce tension.
Conclusion
As a result of the analysis of the bank in question and its activities, it was found that the main problem is a toxic culture and the resulting social and economic structure of the organization. Consequently, the corporation needs to work out precisely this area in order to begin the stage of innovation and structural change. In addition, thanks to the Lewin structure used for the analysis, the main reasons for the resistance were identified, which confirms the serious influence of the toxic culture on the structure.
References
Bátiz-Lazo, B. (2018). Cash and dash. How ATMs and computers changed banking. Oxford University Press.
Crosby, G. (2020). Planned change. Why Kurt Lewin’s social science is still best practice for business results, change management, and human progress. Taylor & Francis.
Ferguson, A. (2019). Banking bad. Whistleblowers. Corporate cover-ups. One journalist’s fight for the truth. ABC Books.
Lalchandani, N. (2020). Payments and banking in Australia. Innovations Accelerated.
Lehman, C. R. (Ed.). (2019). Beyond perceptions, crafting meaning. Emerald Publishing Limited.
OECD. (2020). OECD rural studies linking indigenous communities with regional development in Australia. OECD Publishing.
Powell, M. (Ed.). (2019). Skill formation and globalization. Taylor & Francis.
Ramage & Shipp, K. (2020). Systems thinkers. Springer London.