The Need for the Change in Staffing and its Impact on all Stakeholders
HSBC Bank wishes to appreciate the contribution of all its employees to the organization’s productivity, thanks to the company’s advanced knowledge sharing base and its excellent connection with the widening array of co-workers and consultants. The outcome of this operation plan has been the creation of new knowledge repositories that have guaranteed the availability of a new technological approach to executing business processes at the bank.
To this extent, employees have been a valuable asset that has ensured success in our line of business. However, due to the planned changes in the operational environment, the bank risks securing continued competitive advantage if it does not embark on change. To ensure that our stakeholders continue to reap maximum benefits, the bank now decides to employ new technology in its operations. However, it is regrettable that this decision would lead to the laying off of 1500 employees. The goal is to reduce direct labor costs to ensure that the bank remains afloat while increasing its stakeholders’ value regarding their investments in the end.
The management fully understands that this change has a direct impact on its employees. However, we would like to clear rumors that arise when an organization adopts a new technological strategy to enhance its continued operations. All laid-off employees will be paid their benefits, including their service remuneration. The bank remains committed to the employment agreement with its employees, especially its obligation concerning the termination of service.
All employees who will not be affected by the laying off program will continue working under their original respective contractual agreements. The new technology intervention will reduce errors associated with human decision-making processes, which we believe will cut or minimize cases of misinformed stakeholders. The technology will also guarantee the real-time availability of information to all stakeholders, hence reducing information asymmetry.
Key Trends, Assumptions, and Risks in the Context of the Communication Plan
According to Bettis, Gambardella, Helfat, and Mitchell (2015), strategic management relies on some administrative aspects such as power and politics to function properly. Deming (2012) asserts that strategic management functions through corporate legitimacy, well-organized structures, the dominance of decision-makers, and the presence of discursive practices. Similar to managerial approaches, Schermerhorn and Bachrach (2015) present strategic management as a stage-wise process of enhancing organizational success.
In the context of the current communication plan, organizational politics concerning the circumstances that led to the change among employees poses an immense risk in terms of maintaining employees’ organizational commitment and motivation levels after implementing the change (Dark, Whiteford, Ashkanasy, & Harvey, 2017). However, it is assumed that this risk will be minimal since employees will appreciate the value of the new technology.
Hence, they will understand that procuring technology will ultimately lead to laying off some employees. Besides, the selection criterion to be adopted to lay off employees remains a significant challenge, owing to the possibility of a section of the divide questioning the process on the grounds of unfairness.
A trend is observable, especially concerning the increased call to reduce information asymmetry coupled with the adoption of cost-cutting strategies across many organizations. Considering the HSBC Bank’s commitment to eliminating unfairness in terms of information possession and disclosure, it is assumed that stakeholders, including suppliers and shareholders, will receive the communication positively. In particular, investors should be interested in a strategic management change that reduces information asymmetry (Schermerhorn & Bachrach, 2015).
Petrova (2012) argues that aids in contracting between various parties, for instance, investors and managers, where payments are done with respect to the reported accounting data. Therefore, investors will embrace this plan, which focuses on reducing the number of insiders who have disproportionate accounting information while increasing the real-time distribution of accounting information. However, the risk of the reception of the communication in a negative way by the investors and suppliers may be inevitable. Some investors may question the strategic initiative based on the cost-benefit analysis when compared to retaining the current high pool of employees.
The Vision, Mission, and Values of HSBC Bank
The strategic initiative reflects the key values, mission, and vision of HSBC Bank. The bank confirms that the manner in which it carries out business is equally important to what it does. Hence, it continuously seeks to establish trust and a long-lasting relationship with its different stakeholders. This obligation forms its primary mechanism for value generation coupled with increasing returns on shareholders’ investments. Perhaps, an initiative to adopt a new technology to foster such a relationship while delivering better value to shareholders is warmly welcomed. HSBC’s mission revolves around becoming the global biggest specialist-banking corporation.
The bank endeavors to portray integrity in its operations to maintain its distinctiveness. Therefore, it focuses on what is right, delivers its commitment, ensures resiliency, and/or maintains trustworthiness. Consequently, according to Schermerhorn and Bachrach (2015), any move that can increase the information available to stakeholders to facilitate decision-making is critical to remaining truthful to the organizational commitment to its values.
Its vision entails assembling different people with the objective of making a difference. For shareholders, this difference involves receiving high returns on their investments. Employees would be happy if their contribution to the success of the organizations is appreciated and/or the developed knowledge bases are implemented. To this extent, the new technological change would receive minimal opposition upon considering that it forms part of an employees’ creation.
SWOTT Analysis of HSBC
HSBC Bank’s strong brand name in the US and other global operational areas evidences its capable financial position. It enjoys a huge presence in an array of business groups, including investment banking, private banking, and commercial banking sectors. The fact that HSBC Bank has a diverse customer base implies it experiences minimal risks. Amid these strengths, the bank also has some weaknesses. For example, it operates in a declining United States market. It also has a weak retail operational market in comparison with its competitors.
HSBC balances its threats with opportunities to ensure that it continues to grow and sustain its market share. Opportunities for the bank include the existing external chances, which while utilized make an organization improve its performance. It also enjoys personnel that is on par with technological changes. Threats include the external forces that impair the performance of an organization. HSBC’s main threats revolve around the fluctuating governmental regulations, the possibility of crises, including recession, and high competition from various global leaders in the banking sector.
However, it can deploy opportunities to leverage these threats. Other opportunities include a reduction of interest rates in the effort to raise its market share and the diversification of its customer portfolios. An observable trend includes the amplified need to minimize or eliminate information asymmetry and the need to emulate cost-cutting mechanisms in its operations.
The above information can be represented in a tabular format as shown below.
References
Bettis, R., Gambardella, A., Helfat, C., & Mitchell, W. (2015). Qualitative empirical research in strategic management. Strategic Management Journal, 36(5), 637-639.
Dark, F., Whiteford, H., Ashkanasy, N., & Harvey, C. (2017). The impact of organizational change and fiscal restraint on organizational culture. International Journal of Mental Health Systems, 11(1), 1-7.
Deming, Z. (2012). Research on the barriers to knowledge transfer of industry technology innovation strategy alliance and its countermeasures. Information Studies: Theory & Application, 2(1), 134-149.
Petrova, E. (2012). Relationship between cost of equity capital and voluntary corporate disclosures. International Journal of Economics and Finance, 4(3), 83-96.
Schermerhorn, J., & Bachrach, D. (2015). Exploring management. Hoboken, NJ: Wiley.