Restructuring of First Bank
Family enterprise, First Bank, has, for three decades, been the town's only bank. Mr. First, the founder, originally instituted it as a little loaning shop; the small business grew larger, turning into the town's sole financial services organization. It provided small loans and over-the-counter cash facilities to clients. The town's growth, however, has led to a tremendous increase in the bank's client base, challenging the current operational structure of the organization. The problem faced is threat to the organization's existence, owing to the fact that the bank, at present, is not up to the task of meeting the town's growing demands. Bank management, comprising chiefly of family members, is unwilling to alter the existing operational structure as well as improving quality and increasing the number of personnel employed. This has been a major factor in the bank's inefficient, stagnated, and outdated structure. Apart from hiring fresh talent, expansion of the business by using varied product range and automation of the existing services is necessary. Change Management is required for an organization to move from current state to the desired state. Consequently, at First Junior's (Mr. First's son) insistence, management has, appointed Transform Consultants for aiding them with effecting organizational development and change.
Change Management
Change, in general terms, is described merely as "a new state of things" that differs from the state of things previously (French & Bell, 1999). Thus, by employing this definition, one can explain organizational change as a transition from an existing state to a future state, where the enterprise wishes to reach (Cummings, et al., 1985). The simplest way to comprehend change in the organizational context is a comparison of it with other forms of change, rather than an attempt at defining it. The name "organizational change" deals with a transformation in the activities of an organization. However, this definition does not suffice, as it fails to explicate the kinds of activities undergoing change. The foremost thing one can note through a comparison of organizational and operational change is that the former has a broad scope, covering all operational practices, manufacturing, logistics, and customer service, while the latter deals exclusively with individuals in the organization, their values and their roles (Salminen, 2000)
According to Schoonover and Dalziel (1988), change is either an unplanned or planned organizational response to external and internal pressures, emerging from various sources. For instance, external factors can be competing firms, technological advancements, and regulators, while internal change forces may be product or service obsolescence, increase in workforce diversity, new opportunities in the market (or new markets), and new strategic aims (Lanning, 2001). Numerous strategic factors drive change processes (Schilling & Steensma, 2001); these include the requirement for greater organizational-task-related integration (Rugman & Hodgetts, 2001) and the necessity to bring about better enterprise performance (Balogun & Hope, 2008). Adler and Shenbar (1990) profess that all changes necessitate revision and transformation in organizational processes, methods, human skills, culture and strategy.
The word 'change management' is customarily used to describe management of organizational change -- change in company structure, leadership, culture, job structure, values and roles (Salminen, 2000). Change can basically be categorized as radical and incremental. The former (also called revolutionary change, turnaround, and transformation) denotes an extensive, major alteration in organizational strategy and culture, while the latter relates to evolutionary modifications, fixing problems and fine-tuning. In short, incremental change deals with improvements to company performance without essentially altering the company (Lanning, 2001).
Analysis of First Bank
For comprehending specific reasons regarding why change is needed and understanding changes which must be effected in a cost and time-efficient way, a SWOT analysis of First bank was carried out. SWOT analysis refers to an assessment of a firm's internal weaknesses and strengths, and external threats and opportunities. Strengths represent current organizational elements contributing to exceptional performance (such as highly qualified workforce, quality enhancement focus, and employees' thorough understanding of company objectives. Weaknesses denote company factors, which contribute towards lowering service quality or increasing operational costs. Opportunities represent noteworthy novel business initiatives open to a company, whereas threats are elements capable of adversely affecting performance of the organization (Gretzky, 2010).
First Bank's SWOT Analysis
Strengths: sound client base, bank credibility with clients, good client-company interpersonal bonds, small hierarchical arrangement in the company that facilitates speedy decision-making, good loan repayment terms, and flexibility in interest rates
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