During The Change Management Of The Nib Bank Limited Business Essay

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The people of the organization were resisting to the organizational change because they were having different concerns regarding the change process. Some people in the organization resisted to change because they were not sure and having no trust in the success of the change process and the after wards consequences of the change. The management of the PICIC commercial bank and the employees were afraid of losing their jobs as a result of the change. So they resisted because they were having fear of losing something important to them as a result of the change. The employees were resisting because they were feeling they have lack of training and the skills for the new system and the techniques. There are so many causes which can lead the people against the change. (Gary Desseler, 2007) 10

Change agents role in reducing resistance to change:- 11

Diagnose problems:- 11

Develop relationship with clients:- 11

Creates the vision:- 11

Solution to problems:- 12

Developing plans to achieve goals:- 12

Training and development:- 12

Communication:- 12

Conclusion:- 12

Bibliography:- 13

This report shows the process of the change management and the qualities and the role of the change agent in the change management of the NIB bank Limited. The process of the change and the problems and their solution during the change management of the NIB Bank limited. How the management and the change agent managed effectively the change process of NIB bank.

INTRODUCTION:-

The NIB was incorporated in March 2003, as a Public limited Company and the started as NDLC-IFIC Bank. The bank started with paid up capital of 1.20 Billion and started performing its operations in 2003. The Bank started its operations with only two branches in 2003 and then the bank growth rapidly. Until the first quarter of the 2007 the bank was having 47 branches. The bank's mission is to be the leader of the banking companies working in Pakistan.

"There are the following business units of the NIB, as stated on the www.nibpk.com,

Small Medium Enterprises and Commercial Banking Group

 Corporate and Investment Banking Group / Financial Institutions

 Consumer and Small Enterprise Group

 Treasury"

NIB Bank Acquired the PICIC Bank Limited:-

The NIB bank purchased the majority of the PICIC commercial bank and its subsidiaries to accomplish the mission of the organization as well as to meet the Govt. Restrictions and to gain the competitive advantage over the rivals. Due to the acquisition of the PICIC bank, the paid up capital of the NIB Bank increased to 21 Billion. This was the country's largest takeover of the banking sector. This merger was done at Dec, 2007 by completing all the approvals and the process in place. As a result of the merger the NIB's branches increased from 45 branches to the almost 245 branches all over the country. And the employees were 4900 at that time. (Mohiuddin Aazim, 2007)

Mohiuddin Aazim (in Dawn Newspaper article) described that the NIB's acquisition resulted in the control of the NIB on the PICIC commercial Bank, PICIC asset Management Company, PICIC Exchange Company and the PICIC Insurance Ltd. And this leads the organization to be the key player in the financial market of the country. (Mohiuddin Aazim, 2007)

Organizational change: -

The change in the technology, people or the organizational structure is referred to as the organizational change. There are many types of the change which can occur in the organization as a result of the internal and the external changes in the environmental factors. There are mainly three types of the organizational change, technological change, people change and the structural change. The change in the technology leads to the technological change. The change in the reporting relations and the other structural factors of the organization are referred to as structural change. The change in the human resources and the people behavior, attitudes, qualifications, skills and the development or the individual groups is called as the people change. (http://www.businessballs.com/changemanagement.htm)

There are many theories which provide the process of the change process in the organizations. Following are the theories which provide the change process more effectively.

Lewin:-

The change process described by the Lewin consists of the three important stages which are followed by organizations during the change process. (Jim Canterucci, 2008)

Unfreezing: -

The very first stage in the change process is the unfreezing stage. According to Lewin every organization is working in a stable position and this stability is referred to as the organization is in freeze situation. So the very first step in the change management process must be the unfreezing this stable position to bring about the change. The unfreezing can be done by the motivational forces or the triggers which causes the organization to accept the external change. The unfreezing also referred to as the introduction of the disequilibrium into the organizational system and this leads to the creation of need. The motivational factors are implemented by the change agent.

Change: - The next stage of the change process is the implementation of the change in the organization. This change can be technological, structural or people change or any combination of these. Through various source the solution is attained and the best solution to the problem is accepted, communicated throughout the organization and then adopted by the entire organization.

The refreezing stage: -

The final stage of the change process is the conversion of the organization to the stable and equilibrium position again. At this stage the change becomes the part of the system of the organization. This stage the change agent make the organization stable again, after introduction of the change and the system is again at its stable position, as it becomes the part of the system. The restraining forces are implemented by the change agent at this stage. The restraining forces are the forces which make the organization to resist for the changes. (Jim Canterucci, 2008)

The change process can be explained by the following diagram.

NIB Change strategy:-

NIB bank followed the following steps for the change management process starting from the initiation of the change need to the acquisition of the PICIC group. These steps are as given below

Identification of need for change

Research and market analysis

Internal organizational Analysis

External organizational Analysis

Beginning of change process

Selection of the change

Communication of change

Implementation of the change

(Mohiuddin Aazim, 2007 )

Change Agent:-

The change agent can be defined as," the change agent is a person who is responsible for the organization and the coordination of the overall change process." (www.themanager.org/strategy/change_agent.htm)

According to Lewin the change agent can be of two types the internal change agent or the external change agent. The internal change agent is the person from within the organization who takes the whole responsibility of the change process and contributes his efforts for the effective implementation of the change within the organization. The internal change agent can be the sub-set leader of the organization.

The external change agent is the consultant who helps the management of the organization in reducing the resistance to change through motivating the different organizational members for the change.

Ackoff described the two types of the change agents according to their work behaviors. The first one provides the consultancy service to the organization with the pre-determined organizational solutions and the second one takes the process of learning and creating the mutual understanding between the different stakeholders for the development of the decisions and other important issues.

Characteristics of effective Change Agents:-

Change agents are also considered as the change leaders. Jon Katzenbach described that there are seven most important characteristics of the change agent within the business concept. These characteristics are as given below, (Tichy, N.M. 1983)

Effective communicator

Better way Commitment

Courage of challenging the existing power basis and norms

Initiative to go beyond the boundaries

Motivational qualities

Caring about others performance

Staying undercover

Sense of humor to deal with different situations

Effective communicator:-

The change agent has the effective communication skills and they know how to utilize their skills in the best way to gain the organizational goals. Through the effective communication the change agent tries to convince and motivate people for the change.

Better way commitment:-

The change agent represent the better way commitment to the need for the change and the change agent believe that the change will be the necessity of the organizational growth and the development, as well as the personal development of the individuals of the organization.

Courage of Challenging the Existing power bases and the organizational norms:-

The change agents have the ability to create the courage and the motivation in the people of the organization to sustain their commitment in the failure, opposition, and uncertainty and in the scene of the personal risk. They have the ability to build the courage to adopt changes to the people around them.

Initiative to go beyond the boundaries:-

The one most important characteristic of the change agent is that they go beyond the defined boundaries to solve the unseen and unexpected problems occurring within the organization. They are courage to try again and again in case of failure.

Motivational skills:-

The change agents have the ability to motivate themselves as well as the others. They have very high moral and the motivational level, and they have the power and the ability to motivate the others around them. The change agents take the personal responsibility to motivate the others towards adoption of change.

Caring about others performance:-

The change agents are very concerned about the performance of the others in the organization the change agents are fair minded and willing to help others to improve their performance regarding the organizational as well as personal goals accomplishment.

Resistance to change:-

Resistance to change is the negative and the restraining forces which are against the change within any organization. The change agent recognizes these factors and creates solution to reduce resistance and make possible the implementation of the change. There were following factors which created resistance to change of the merger of the NIB and the PICIC commercial bank. These factors are given below, (As Published on December 30, 2008 by norrisl4 in Management)

Lack of trust

Fear of losing something of value

Fear of failure

Lack of training

Fear of lack of competencies

Personal losses

Fear of losing position

The people of the organization were resisting to the organizational change because they were having different concerns regarding the change process. Some people in the organization resisted to change because they were not sure and having no trust in the success of the change process and the after wards consequences of the change. The management of the PICIC commercial bank and the employees were afraid of losing their jobs as a result of the change. So they resisted because they were having fear of losing something important to them as a result of the change. The employees were resisting because they were feeling they have lack of training and the skills for the new system and the techniques. There are so many causes which can lead the people against the change. (Gary Desseler, 2007)

Change agents role in reducing resistance to change:-

The change agent performs the following roles and the functions in the process of the change management including the reduction to resistance to change. These are as given below, (Rob Paton, James McCalman)

Diagnose Problem

Create Relationships with clients

Creates vision

Develop leadership agenda

Solution to problems

Develop and implement plans for change goal's achievement

Education and training

Opportunities for practice

Reflection and feedback

Support system

Diagnose problems:-

Change agents identify the business as well as the organizational drivers to understand the performance issues. The change agents also analyses the impact of these problems on the short run and the long run business performances to attain the goals of the organization.

Develop relationship with clients:-

The change agent build good relationship with the client because the failure risk is higher then the other managements functions. To access the risk, Management consultancy Ric developed the following formula,

Trust=perceived competence relationship/RISK

Creates the vision:-

The change agents create the vision for the change and the rest of the strategy is followed on that vision created by the change agent. The vision provides the hopes and motivations to the employees of the organization. This motivation leads to the successful implementation of the change in the organization.

Solution to problems:-

The change agents provide the solutions to the HR problems occurring due to the change in the organization. They provide the particular attributes to the right strategy and effective change in the organizational culture.

Developing plans to achieve goals:-

The change agent develops the plans and strategies and implements these plans effectively for the successful implementation of the change. The more effectively the goals and strategies are developed the more effective are the performance out comes of the strategies.

Training and development:-

The change agents provide training and education to the members of the organization so that they can do things by themselves more confidently and the resistance to change can also be reduced through the education and training to reduce or overcome the deficiencies in performance.

Communication:-

The change agent possesses very good communication skills. In the merger of the NIB and the PICIC the communication played a very important role in the reduction of resistance to change. The following steps were implemented in the communication process for implementation of change. And send the first level of change with the branch managers to change organizations and workers alike to influence and ensure that the beneficiary is for them and for the organization. They used various means of communication, such as e-mail, flyers, and random visits to the branches of the pelvic area and the small face-to-face information about this change. In such a way that sends with the management team of the Interior. Then they started marketing the third party through advertising. It was once as they were able to convince people, it is easy for them to implement change. (Munawar Hussain)

Conclusion:-

There are rapid and constant changes in the external environment of the organization, which causes the organizations to change. The change process consists of three steps. The first one is the unfreezing stage, change and then the refreezing stage. The change agent plays an important role with the effective leadership skills and abilities to successfully implement the change and also plays a vital role in the reduction of resistance to change within the organization. The change agent can be from within the organization or from the outside the organization. The change agent can be providing the consultancy services by providing the pre-determined solutions to the problems in the organizations or can be working with the management to define the solutions of the organizational problems.

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