The Concept of Change Management
Using the case as a focus, students need to identify the problems, using change management theory to explain why the problems have arisen, and develop supported recommendations to improve the situation, taking into account the concerns and interests of various stakeholders.
The Australia and New Zealand Banking Group Limited or the ANZ, the third largest market capital based bank in Australia, is known to be the most sustainable global bank in the continent. It was founded in 1835 and later became expanded as a result of merger between the Bank of Australia and the Union Bank of Australia Limited. Besides Australia, the bank is leading among New Zealand’s banks.
The concept of change management is the arranged technique setup that deals with transition and transformation of the organisation’s goals, mission, processes and business and technical operations. The main objective of the change management is to execute strategies for bringing about changes, regulating these changes as well as ensuring prompt and effective adaptation and smooth adjustment to changes. Sometimes situations arise where the structure of the organisation requires immediate changes in procedure and mechanisms. The common situations that give rise to need of changes include technological advances, evolution of processes, trends of consumer demands, needs and preferences, entries of new businesses and so on and so forth. In terms of management, the change management also refers to the planning and application of alternatives to the present approaches and control processes. (Cranston, 2018)
Before understanding the concept of change management with respect to the ANZ, it is vital to understand the ANZ business and work system. The ANZ has a long history, dating over 170 years. Over the years the financial organisation has undergone several kinds of expansions, growths and ventures. Today it handles a huge range of services and products, financially, in the retail, small business, corporate and institutional sectors. The organisation owns over 471 billion Australian Dollar worth assets and have operations in over 30 countries. The structure of the organisation has five main divisions, the major ones being in Australia, New Zealand and Asia Pacific. Each division has its own functions and units dedicated to meeting customer needs and requirements. (Cikaliuk, et al 2017)
In 2008, the organisation started expanding and developing the existing values and operations. The management took assessments and evaluations, interacted with employees, researched on the global best practices and analysed the recent existing Engagement and Culture Census. The census is the key measurement tool of people and culture that exists in the company’s system. The ANZ established that the employees wanted more integrity, collaboration, accountability, respect and excellency and other ethical values. The company is focused on an inclusive and healthy work culture. There is the objective of keeping the employees connected with the culture of the company. The ANZ is one of the leading organisations which encourage financial literacy and inclusion.
ANZ Business and Work System
The company had seen its ups and downs throughout the last few decades. From poor performance in the 1990’s to mistrust of the public in the banking system, the organisation had undergone several issues and challenges. With the start of the 2000’s, the ANZ started focusing on organisational transformation. In order to maintain and update its transformation, the company has to understand the dynamics of change management and apply the approaches and techniques of the change management concept. (Moradi-Motlagh, and Babacan 2015.)
The organisational change or transformation management is a structure technique which brings about changes in a smooth, functional and successful manner, with the aims of getting long term oriented results. Globalisation and innovation have emerged with continuous changing business environments. Technology like internet has revolutionised the modern day business context. There is a constant requirement for implementing effective changes. Hence the need for change management. Long standing organisations as well as newly come up companies are all experiencing changes. The ability to adapt and adjust to the changes is quite vital and strategic. Change is difficult and consumes quite a lot of time and energy. Major changes are complex to create because of the presence of deep structure, culture and business operations. Changes are created and organisations are expected to adapt rather quickly as possible in order to gain competitive advantages over other companies. Some organisations do not change overnight due to their reluctance to adapt to changes and they prefer to stick to their old operations, approaches and policies. Yet it is crucial that they change their organisational features. Companies and organisations take their own time to transform and adapt to changes especially companies which are old and have been in business for a very long time. The changes can either influence or affect the performance at work and the employees. (Bollen, et al 2015)
Companies and organisations must learn to change themselves in order to survive the changes in the market and business context. There are several Change Models which help companies evolve and transform and survive. Companies choose the model that suits them and their goals according to some important criteria, including the goals of changes, the assessment findings, the sequential order of system and the extent to which changes are to be made. The major ones are as follows-
The Lewin’s Model- one of the most popular approaches which divides the change process into three stages or phases. Lewin stipulated Unfreeze, Making of changes and Refreeze as the three stages. The method of the model starts with unfreezing when the organisation realises that changes are to be made. Current and existing system is analysed and the situation is assessed to understand what changes are to be made, whether they are necessary immediately and whether they will pose risks on being implemented. Perception of changes is changed and resistance against changes is reduced. Allowance for natural an progressive changes is gradually allowed. The organisation prepares itself for changes and their challenges. (Islam, 2016) The second stage, Changes, then starts gradually. The company makes sure that the time is right to make according changes. Changes are prioritised and plans are put into action. Teams are guided on the step by step changes and communication is made on all levels to initiate changes. Switching to newer and updated version of the system takes time and energy and that is allowed. Training is conducted as well for those who are unfamiliar with the new changes. Embracing of new happenings is actively encouraged. The final stage, Unfreezing, then gets underway. Once the company has effectively and successfully initiated, applied, embraced and accepted the new changes and has settled down, the stabilisation process starts. Reviews are made and constant evaluation is made regarding the success of the plans and actions. Everything returns to normalcy but in a changed manner. It is made sure that the changed system is consistent and continuous.
Background Information on ANZ
McKinsey 7S Model- the 7S Model is one of those approaches companies can always use when other approaches fail or go out of use. (Doppelt, 2017) The approach helps the company analyse the cohesiveness of the workplace and the need to change. Highlighting and evaluation is done and a series of 7 steps are taken to allow gradual, progressive and productive changes without hurrying any process unnecessarily. First, strategies or plans are made, with development being done of a step by step procedure or a future plan. Second, structure or stage is analysed and evaluated. The attributes of the management and organisational structure are segregated, identified, arranged and planned on. Third, the system of the business operations, activities, features and other arrangements are assessed to understand whether and what changes are to be made. Fourth, shared values or core values and goals are prioritised and changed if necessary or modified. Fifth, the style of changes is decided. Style is the manner or mechanism of the changes and the process they are to be made in. Sixth, the staff is given the say in the changes to be made, as they are directly involved with the business activities. Their feedback and suggestions are assessed and planned out. Last, the skill set is organised. The staff is trained and the organisation as well equips itself with new skill sets and new trends so that its can flexibly stay up to date with the changing environments. Staff skills are as well assessed to understand whether they are capable of adapting to the changes being made. This model helps organisations get a deep and detailed insight into its system and work place and policies in respect to the changing environment and the rival competitors. (Cameron, and Green, 2015)
Kotter’s Change Management Theory- this model is another popular theory and globally used as well. This theory of change is also divided into stages or phases of change planning and implementation. The first step is to increase urgency. This refers to creation of sense of urgency for motivating the staff to start preparing to move towards the objectives of the organisation. The company creates the sense of the need of rapid changes to be made. The second step is to build a team. Right people are recruited and trained for the apt jobs, tasks and skills. Teams are then built on the basis of a mixture of skill sets, information, knowledge and dedication to the organisational goals. The third step is to get the vision made and corrected or modified according to the changes that are needed planned. The goals are fixed and the changes are made goals as well. The fourth step is to communicate at all levels of the organisation, planning on the smaller and minor steps to making decisions with every unit on major changes to be made. The fifth step is to get things on the constant and progressive move. The organisation supports the changes being made, makes sure the change processes are smooth and constructive and achievable. The sixth step is focus on short term goals and objectives so that these goals can build up long term and major goals. The company starts with small steps and as it goes ahead, the steps increase in enormity, scale and extent. The last two steps involve not giving up and incorporation of The company makes sure not fall back on its plans and ensures the constant process of making progress. The company as well starts settling in with changes being made and adapted into the system. (Kuipers, et al , 2014)
The Need for Change Management in ANZ
The Nudge Theory- this theory is a psychology theory of effecting behaviour, attitude and the nudging tendency to start making changings. The basic element of this theory is that the organisation feels nudged to make changes for more effectiveness. The behaviourist theory helps the company define its goals, determine the changes, be aware of the changing environment and the need for changes. Choices are made and decisions are made after finding evidence form assessment studies and consulting with everybody including the employees. The company then decides whether the change is good or effective and whether it is crucially needed. The changes are presented as choices and alternatives. Obstacles are resolved and the changes are planned and put into effect with help of the various change management models. (Howes, et al )
ADKAR Model- this model of change is an objective oriented management tool used for different situations, crises and other circumstances. The tool measures the situations, derives results and findings and sets goals. The situations that require this tool include the need for supporting employees to undergo process of change or transitioning, the need for tackling the resistance of the people associated to changes and requirement for efficient planning of professional and personal issues. ADKAR stands for Awareness of the need for change, Desire for bringing about the change, Knowledge of the mechanism to effect changes, Ability of adapting to changes regularly and Reinforcement of implementation of changes.
Bridges’ Transition Model- this model of change focuses on three stages of changes, phases that are benchmarked by small milestones. The first phase involves ending, losing and letting go of the old system, the obsolete operations and mechanisms and other familiar systems. The process is slow, painful, emotional and full of resistance to letting go of what was normal. Once the phase enters the second stage, the neutral zone phase starts. This period is marked by uncertainty and confusion while planning and making changes. Various processes are carried out so that new changes are adopted. Lots of adjustments are made as well. Once everything starts settling down, the final stage winds up the entire change process. The new beginning phase involves acceptance and implementation and maintenance with regularity. (Kilminster, et al 2015)
The Kubler-Ross Five Stage Model- this model, also called the grief model, includes five stages of changes from psychological perspective. The first stage is of denial where the change is not being accepted willingly. Culture shock takes place. The second stage of anger involves frustration and disheartenment at the changes being made. The third stage of bargaining involves compromising and negotiating as changes are being adjusted with. The fourth stage of depression soon gets replaced with the final stage of acceptance.
Change Models Available to ANZ
Managing the change process involves several challenges because issues can arise during the process. The vital aspect of any organisational transformation is the company’s ability to effectively manage the transformation. The challenges lie in identifying the right changes required in the changing environment, creating and maintaining the accurate adjustments, the correct training of the right people for appropriate changes and persuading the acceptance of the changes in the organisation. (Schermerhorn, et al 2014) Change management processes require strong creative connectivity, awareness, marketing and communication. Successful changes occur when the company can correctly define the changes to be made, monitor the change process, counter any crisis or challenge and provide right measures. Issues can arise when the following key challenges emerge-
- At times integration fails and organisations are faced with situations where the organisational goals and policies do not align with the necessary changes.
- Navigation and negotiation of the changes can often fail and the changes being implemented are not sustained properly.
- Mismanagement of changes lead to a complete chaos.
- Communication gaps can lead to management crises, where the changes made are not known to all and not everyone is used to the changes or are not adequately trained or skilled to handle the changes. Cultural and other kinds of clashes can also occur due to miscommunication.
Conclusion:
ANZ feels a few changes have to be made in its organisational structure. It has to be kept in mind to majorly restructure the workplace without causing a major shift in the business which might affect the company’s position. (Dumay, 2016) The company can start with a feedback sharing arrangement with all units. Employees can be consulted and their suggestions can be taken. They should be in the know about plans to make changes. The organisation can then set up short term goals and initiate small steps towards small but significant changes. As the changes increase in number and scale, the company can start reinforcing changes, training and recruitment processes as well as application of any change model that suits its organisational needs and structure. The plans should be kept simple and the changes should be kept gradual and progressive. ANZ then can start changing the organisational framework, and the workplace will soon adapt to the changes. (Adams, 2017)
To make changes, all companies should at first understand what changes are to be made and the mechanisms to apply the changes. The change models and theories help companies in the transformation process.
References
Adams, C., 2017. Understanding integrated reporting: The concise guide to integrated thinking and the future of corporate reporting. Routledge.
Bollen, B., Skully, M., Tripe, D. and Wei, X., 2015. The global financial crisis and its impact on Australian bank risk. International Review of Finance, 15(1), pp.89-111.
Cameron, E. and Green, M., 2015. Making sense of change management: A complete guide to the models, tools and techniques of organizational change. Kogan Page Publishers.
Cikaliuk, M., Erakovic, L., Jackson, B., Noonan, C. and Watson, S., 2017. Board Leadership for Strategic Transformation: Aligning Diversity Initiatives at the Bank of New Zealand.
Cranston, R., 2018. Principles of banking law. Oxford university press.
Doppelt, B., 2017. Leading change toward sustainability: A change-management guide for business, government and civil society. Routledge.
Dumay, J., 2016. A critical reflection on the future of intellectual capital: from reporting to disclosure. Journal of Intellectual capital, 17(1), pp.168-184.
Howes, M., Tangney, P., Reis, K., Grant-Smith, D., Heazle, M., Bosomworth, K. and Burton, P., 2015. Towards networked governance: Improving interagency communication and collaboration for disaster risk management and climate change adaptation in Australia. Journal of environmental planning and management, 58(5), pp.757-776.
Islam, M.A., Jain, A. and Thomson, D., 2016. Does the global reporting initiative influence sustainability disclosures in Asia-Pacific banks?. Australasian Journal of Environmental Management, 23(3), pp.298-313.
Kilminster, K., McMahon, K., Waycott, M., Kendrick, G.A., Scanes, P., McKenzie, L., O’Brien, K.R., Lyons, M., Ferguson, A., Maxwell, P. and Glasby, T., 2015. Unravelling complexity in seagrass systems for management: Australia as a microcosm. Science of the Total Environment, 534, pp.97-109.
Kuipers, B.S., Higgs, M., Kickert, W., Tummers, L., Grandia, J. and Van der Voet, J., 2014. The management of change in public organizations: A literature review. Public administration, 92(1), pp.1-20.
Moradi-Motlagh, A. and Babacan, A., 2015. The impact of the global financial crisis on the efficiency of Australian banks. Economic Modelling, 46, pp.397-406.
Schermerhorn, J., Davidson, P., Poole, D., Woods, P., Simon, A. and McBarron, E., 2014. Management: Foundations and Applications (2nd Asia-Pacific Edition). John Wiley & Sons
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