Manging Change at Anz Essay

Published: 2020-04-22 15:06:56
1702 words
7 pages
printer Print
essay essay

Category: Bureaucracy

Type of paper: Essay

This essay has been submitted by a student. This is not an example of the work written by our professional essay writers.

Hey! We can write a custom essay for you.

All possible types of assignments. Written by academics

1. Explain some of the triggers of change in ANZ

Australian and New Zealand Group Ltd (ANZ) is one of the five largest leading companies in Australia. It has more than 700 branches in Australia with 34,000 plus international employees.

The Australian Banking Industry has undergone considerable changes when the Federal government deregulated the industry in 1980s. Previously, it was highly conservative and protected with a public service culture. ANZ had to adapt to new changes of deregulations.

Due to mergers and acquisition in Australia, from 1960 to 1980, 12 trading banks dwindled to 9. After deregulations and issuing new licenses, the numbers escalated to 34. Subsequently, new competitors emerged in home mortgage industries and banks, which operated on a low cost framework. Hence, the banks were unfamiliar with the new pressures (Wood, Zeffane, Fromholtz, Wiesner, Creed, Schermerhorn, Hunt, Osborn, 2010).

Regarding the change in ANZ, deregulation sparked it off which presented significant challenges for ANZ and other banks in the industry. According to Lewins three phrase of planned change, phrase one where they create a felt need for change by disconfirming their current attitude and behavior caused by environmental pressure (Wood, et al., 2010).

When such changes are imposed, organizations become prosperous. Therefore, ANZ was keen on implementing extensive changes to remain successful.

On the whole, usually imposing external forces for changes leads to reactive changes. Sometimes even changes required by legislation are forced upon.
Even though, there were no legislative changes imposed on ANZ, however, it had to change to survive the competition.

Notably, due to tough market conditions, ANZ chalked up bad debts due to several years of poor performance. To overcome this situation, ANZs essential focus was on cost reduction and adopting an aggressive approach in seeking new businesses.

So as to overcome the financial crisis and excessive competition, ANZ has to implement a change program.

2. Analyze and describe the change strategies adopted by ANZ The Australian Banking Industry had undergone considerable changes when Federal government deregulated the industry in 1980s. Deregulation led to high competitiveness in the banking sector as the number of trading banks rose. In general, deregulation presented significant challenges for ANZ and other banks. To survive this competitive environment, ANZ adopted many change strategies. The key reason for change focused on cost reduction and seeking new business. 75% of change programs failed, as employees are not engaged in it. Hence, it is a worrying problem. So as to bring an across the border change in employee mindsets, ANZ initiated Perform, Grow and Breakout cultural change program in 2001. By 2008, more than 30,000 employees had participated in it. The first breakthrough participants were CEO, business heads and senior staff.

This is a normative-reductive strategy, which attempts to bring about a change by establishing values and assumptions to support for the change that emerges naturally, (Wood, et al., 2010). ANZ employed external consultants, McKinsey & Co., to analyze the organizations culture. The analysis revealed a gap between the banks perception and employees personal value. To bring about cultural changes, the bank built engagement at both top and bottom levels of the organization and then meeting in the middle. Besides, bringing about cultural changes, ANZ implemented structural changes. Previously, it had a bureaucratic structure, which restricted the flow of information. In addition, ANZ measured its financial and operating results against Australias highest performing organizations.

To set this benchmark, the bank set up its performance, ethic and value assessment survey. The bank measured its success against the organizations on objectives based on co-ordination and motivation. Furthermore, ANZ also focused on removing ineffective managers. Having to rank them systematically is to ensure that the weaker people are being managed.

In addition, ANZ also focused on having better HR management information that is readily available to the managers to improve efficiency, effectiveness and workplace culture issues. All in all, they also undertook efficiency measures such as cost to income ratio and also improved their relationship with the Finance Union of Australia. They also tackled mass organizational changes that include exercising various types of power. Seeing that power is generally in the hands of the key person and if they act inefficiently, it can affect the entire organizations success.

3. What are some of the key Ingredients of the cultural change in ANZ? Implementing cultural change was a necessity for ANZ to withstand the new competition that had arisen. For the cultural change to be successful, ANZ need to look into Lewins three phrase of planned change.

In the past, ANZ bank used to operate using the top down culture where decision-making is made only at the top management level. This leads to a  ap between managements perception and employees personal values.

Therefore, ANZ had to bring across the board shift in the employees mindset because 75% change programs failed as the employees felt they were not engaged. To initiate this change, ANZ introduced perform, Grow and Breakout cultural change program (Breakout) in 2001.

Breakout programs objectives would be earning the trust of employees, leading, inspiring employees and creating values for shareholders. By 2008, employees participants were above 30,000.

In addition, ANZ also appointed external consultants from McKinsey & Co. to conduct analysis on the organizations structure. With this analysis, former chief executive officer (CEO), John McFarlane realized that ANZs organizational structure should change from bureaucratic to participative style.

The bank also set up performance ethic and values assessment survey by benchmarking itself against Australias highest performing organizations. Furthermore, ANZ also introduced engagement building at the top and bottom levels of the organization and then meet in the middle. The banks engagement rose to 63 percent by 2005, staff satisfaction rose to 85% by 2004 and overall knowledge jumped to 87% in 2004.

They also introduced overarching efficiency measures such as cost to income ratio. ANZ also improved their relation with the Finance sector union of Australia to step up employees conditions. It also has a systematic process of dismissing inefficient managers. Overall, ANZ improved their HR management information for managers that improve effectiveness, efficiency and workplace culture issues.

4. How could you describe the leadership style of former CEO John McFarlane? Leadership means organizing and directing a group of people to achieve a common goal. ANZs former CEO John McFarlanes leadership style was participative and democratic. He was an effective change leader, people-oriented with a clear vision, nurtured and supported his employees. Previously, ANZs organization structure was bureaucratic and hierarchical. In 1990s, Australian banks were facing tough market conditions because ANZ amounted bad debts. Ever since, John McFarlane joined the company in 1997, it had reported record returns in 2000 due to structural changes.

He strongly believed in a participative employee process. For instance, he brought in changes by building engagement at the top and bottom level and then getting it to meet in the middle. John McFarlane brought in building engagement changes and many cultural changes. For example, implementing perform, grow and breakout program. This program focused on earning employees trust, community, leading and inspiring employees. He ensured that employees were involved in the change management programs.

Over 30,000 employees participated in the breakout program. According to the changes that were made by John McFarlane as stated above. First, the banks engagement level was 63% in 2005 as compared to 58% in 2004. Second, job satisfaction was as high as 85% in 2004 as compared to 62% in 2001. Third, overall knowledge increased from 46% in 2001 to 87% in 2005. He also builds an organizational structure that supported employee inputs and decentralized decision-making process. In particular, ineffective managers were identified and removed. He also forged closer ties with the finance sector union of Australia so that employees are given priority. Mr. John McFarlane also invested in HR management information to improve efficiency and workplace culture issues.

5. What power and conflict issues can occur during a period of organization change? How has ANZ dealt with these issues? Power is defined as the ability to get someone else to do something you want done, make things happen or things done in your way (Wood, et al., 2010). Traditionally, ANZ had a culture where Party in authority i.e. senior management controlling all the power and therefore causing restricted information flows. Thus, employees distrust would spark. The first power issue; if key personnel in organization holding the power moves in the wrong direction, it will affect the entire organizations success. The second major change is made when organizational behavior changes. External parties like trade unions can affect such change programs. For example, internal parties like key people or groups also affect the organizational change. Having to get their professional and personal outcomes contrary to management intentions and benefits.

With regards to the above, subordinate, people in other divisions and those who do not have adequate power but who wants influence or control, may take these types of political actions. People may go separate ways for their individual interest. There is lack of collectivity. An increased competition between employees to take advantage of situations is caused by the results of playing internal politics. On the whole, many internal conflicts may arise during a period of organizational change. This can cause negative style of politicking, which is bad for high performing organizations. The change will also create interpersonal conflict.

Individuals who resist the change will have mindset differences and might go against people who do follow through with the change. Conflict will occur vertically and horizontally. I.e. After the change, the supervisor will have a different expectation and mindset on how the employees work (vertically), and peers will expect differently due to the change (horizontally). In handling this situation, Mr. John McFarlane changed the organization structure from bureaucracy to meritocracy.

Hence, flow of information is not restricted which generates trust among employees. Moreover, a segment of the breakout program is devoted for overcoming, withholding regrets and resentment within colleagues so as to release the negative energies and attitudes that reduces performances. All in all, the breakout program leads to low internal conflict and judgment. However, it increases communication within the organization, which results employees getting inner satisfaction. In conclusion, ANZs breakthrough program was a success in resolving power and conflict issues.

Wood, J., Zeffane, R., Fromholtz, M., Wiesner, R., Creed, A., Schermerhorn, J., et al. (2010). Organisational Behavior: Core concepts and applications. Australia: Wiley

Warning! This essay is not original. Get 100% unique essay within 45 seconds!


We can write your paper just for 11.99$

i want to copy...

This essay has been submitted by a student and contain not unique content

People also read