The Event That Have Effected Change Commerce Essay

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In the year 2007, the world saw the beginning of one of the most brutal economic crisis since the great depression around ninety years before then. Bankruptcies of companies and pink slips being offered to employees were the order of the day.

During this very period, I was an employee of an international banking firm JP Morgan Chase, which did considerably well in weathering the storm of the crisis. I joined as an employee of the highly regarded cream of the organization - The Investment Banking department, which happened to suffer the most during the crisis. Tough times demanded for some tough actions to be taken in the organization. In pursuit of cutting costs of the Investment Bank portion of the business, in an almost overnight transfer, the entire team of employees that I worked in was moved to Treasury services department under a new leadership.

This was a tradeoff between retaining a job at JP Morgan Chase with retaining a career in the Investment Banking. The reaction of the employees in the organization was a mixture. Although it was known to the management that there would be a resistance to this change in some sections, it was important for the employees to understand that this change was being done to make the firm's investment banking business more efficient and sustainable.

While some of them looked forward to continue working, there were a few of us who worried how we would integrate under a new management and worried if our hard work during the years prior to then would go unnoticed under the new set up and new leadership. We were going to become part of a larger team, where achievements would have to be bigger, targets would grow and incentives would be divided with a larger group.

As a senior member in my team, I was under the task of promoting the idea of this new change in the team. I was to communicate and convince my team that the change would turn out to be positive for us, and in the process maintain a positive emotion towards the entire process.

The biggest challenges while looking to achieve this was:

Communicating with the team constantly

Operating in an environment with limited access to information

Communicating with the management constantly

Section A - Literature Review

The theme of this literature review aims to throw light on three aspects of this change process. The concept and models used in the three aspects in indicated below:

Classification of the kind of change the event fits in : Nadler's types of changes

Communicating the change : Clampit's comparison of 5 ways of communicating and its effectiveness

Motivating people to change : Expectancy model of motivation to support or resist change

Classification of the Change - Nadler's types of change:

This is a classification, which draws a matrix between the approach taken in terms of timing and the type of change in terms of its impact on the organization.

Source: Nadler, D.A, Shaw,R. and Walton, A.E (1995)

Incremental Changes:

Tuning: Is a proactive measure being taken for an impact that will only be incremental on the base position. There is no urgency to employ this type of a change, but it is viewed to be an improvisation in order to stretch the base position to sustain during its journey towards organizational vision.

Adaptation: Is a reactive measure that is taken in order to align the organization to the environment that it functions in. Most times, an adaptation uses doing something that is already being done in more number of times, or in a way that the competition is doing it.

Transformational Changes:

Re-orientation: Is a proactive measure taken in order to be aligned and effective during future opportunities or challenges that the firm is likely to face. Usually Re-Orientation is a notable deviation from the usual way of doing things, in order to develop the organization to respond to the change it expects.

Re-creation: Is a measure which comes in as a reaction to an event that has occurred in the environment. A recreation usually means a permanent change in the way of doing things and also usually involves a modification in the initial goals of the organization. A Recreational measure is used to push the organization towards sustainable competence.

Communicating the change: Clampit's comparison of 5 ways of communicating and its effectiveness

Communication of the change can be processed by various approaches. Managements tend to propose communication of change based on the volume of information and the effectiveness of the communication expected. Clampit has highlighted the five types of communication built on the above indicated bases:

Source: Clampitt, DeKoch & Cashman, (2000)

Spray and Pray:

This is a process of communicating in the organization, where it is believed that providing the employees with a lot of information would lead them to feel informed, and reduce and possibility of uncertainty within the organization.

In the real sense of things, people would absorb only relevant information when there is a presence of a lot of information, and this may sometimes fire back at the organization which is willing to communicate multiple messages.

Tell and Sell:

This is a process of communicating in the organization, where the aspect of change communicated happens to be the core issues. Here, the real change is spoken about first and then there are series of communication vehicles which aims at conveying the change process to the organization.

In the real sense of things, people listening to the information about the change are not allowed to discuss their concerns, as it is assumed that the communicators have access to all the information that is required to be communicated.

Underscore and Explore:

This is a process of communicating in the organization which is similar to Tell and Sell when it comes to the kind of message being communicated. The distinction comes in the area of allowing others to understand the implications of the change themselves, rather than closing the doors to that as well as in the previous process.

In the real sense of things, the listeners of the information usually come up with issues that they are facing with the change and these issues are noted and tackled by the management.

Identify and Reply:

This is a process of communicating, which is more inclined towards providing specific information on the concerns highlighted by the employees. This process involves more of listening and less of telling.

In the real sense of things, there needs to be a practical situation where the employees seek clarification over the partial information that they hold, which has not necessarily been communicated by the management.

Withhold and Uphold:

This is a process of communicating, which operates with the theme of withholding information from the employees unless there is a need to communicate the same to them. Usually they are held within the management because there can be external implications to the firm if the information is sent out to them.

In the real sense of things, managements which try to establish the difference of levels in the hierarchy of the organization, use this as a style of operation.

Motivating people to change : Expectancy model of motivation to support or resist change

This theory is developed around Vroom, 1964 and Porter and Lawler, 1968 theories about expectancies that run in the background of human motivation. [Book I am using - 207]

Source : Hayes, J - 2007., p 209

In the process of being motivated, there are two core expectancies:

Effort to Performance Expectancy: This is a relationship where the person putting in the effort would want to know if the efforts would lead to the performance that he wishes to achieve.

Performance to outcome Expectancy: This is a relationship where the person who has performed the action would want to know if the performance would lead to the valued outcome he is expecting.

Motivation to support or resist a change comes as a result of the outcome being able or unable to add value to the person who is putting in the effort. Managements tend to collect feedback during resistance and push towards new efforts all over again.

Other factors to be considered:

Factors that affect Performance: This model is extended to a phase where we can understand the factors that revolve around the performance of a particular task. These factors include stakeholders understanding of the nature of task required to be performed, and the stakeholder having the required competencies to do so.

Factors that affect Valued Outcome: Another extension of the model helps one understand that the valued outcome tends be valuable only when it matches or exceeds the perception of value that the stakeholder holds in his mind.

Section B - Analysis

Classification of the Change - Nadler's types of change:

Source: Nadler, D.A, Shaw,R. and Walton, A.E (1995)

The event of change that occurred at JP Morgan Chase can be classified clearly as a proactive measure, as this was something that happened before the results were announced for the year. It was also in the light that JP Morgan Chase was the only American bank during the financial crisis to be in a strong position and suffered the least losses in comparison to many of its peers which went bankrupt.

Now that we have established that the change was proactive in nature, it is important to understand if it was Incremental or Transformational. The entire business was being moved to a different division of the bank, under new managements and new principles. Unlike smaller companies, a move of this sort in most ways seems like moving to a completely different company. It is easy to then establish that this was a Transformational change, which helps us conclude that this event was a Re-Orientation.

Communicating the change: Clampit's comparison of 5 ways of communicating and its effectiveness

Source: Clampitt, DeKoch & Cashman, (2000)

The information of the change was based on a management decision that was taken at the highest levels of management in the company. There was absolutely no way that this change process could be corrected with feedback from the employees in the context of such a huge organization, considering the situation that the financial companies were in.

With that in notice, the amount of information was not small enough no not impact the stakeholders to a large extent, but it was not large enough to engulf a lot of stake holders to the situation as it affected only people from the Investment Banking department. As most well run international companies, there is a policy at JP Morgan Chase to engage employees and collect effective feedback about the impact of the change. During the sessions of feedback, the managers were encouraged to have open discussions with employees and target the uncertainties that the teams felt, in the process allowing them to figure where they fit in the new scheme of things.

Considering all the highlights of the event, it is clear that there was no singular approach to communicating the change and though it involved a large portion of them to get communicated of new goals under Underscore and Explore methods, there were a section of the employees who needed Tell and Sell and Indentify and Reply as well.

Motivating people to change : Expectancy model of motivation to support or resist change

Source : Hayes, J - 2007., p 209

Motivating the employees to accept the new change in the structure, and allowing them to identify opportunities for the future was a task that I performed in the team. There were numerous moods to the news when it was just informed to the employees without them having been in the loop. All the moods had to be neutralized and the employees were to fit into a position where they had to understand that getting into the new set up might open up new opportunities for them.

Effort was put in by employees to get inducted to the new transition as it was mandatory for them to do so. The amount of effort they put in translated to scale of positive results in getting inducted to the new change in the team.

Understanding the performance required was communicated extensively in the meetings that were being held to induct the team under the new set up. There were constant sessions called 'Break the Barrier' that was conducted, where teams would work with new people from the larger team in order to groove them to the mood of accepting the change.

Required Competencies would have to be the same as in the previous team, as the day to day work continued to be the same. The only additional competency required was to be in a position to work in a new team.

Performance was closely linked to the effort that was put in by the employee to fit into the change. Some of them showed the commitment early and transitioned smoothly, while a few of the employees were delayed. The threat of these employees not finding value in the change was quite visible.

Perceived Equity of received outcomes would be different from each individual. Although there was a clear distinction between the people who valued the outcome and those who did not, even among them the amount of value they expected was not the same.

Valued Outcome in this change was identified in the group meetings. For most of them it was the entire transition to a new a team would be an opportunity for them to showcase their performance under a new management that would not have any notions that are pre conceived about their ability.

Motivation to support or resist change is the end result of the entire process, where some of them agree and disagree to the change process. As long as every stage in the process of motivating employees to change was achieved with positives, the end result was to be positive. However at JP Morgan Chase, the employees are in a structured framework for motivation and employees will continue to be motivated even after they begin to live in the new changed environment.

Section C - Conclusion and Key Learning

In conclusion, this change did make an impact for many of the employees in a positive way as the frameworks at JP Morgan Chase ensure that there is a constant communication between the employees and their managers to clear any challenges that they have faced at work.

All said, based on the need of the organization, there are multiple frameworks that get built. They are effective to a large extent, but it is important to break open from conventions whenever they seem to prove to be ineffective.

Critically thinking, the frameworks allows one to classify actions in a synchronized way, but the core message that one would have to take away from the real scenario is that even if there are ways of doing actions, one must be open to changing the ways constantly. This can be said to be true as a lot of times during the experience process of inducting into the process of the new change, there were no rule books acting as a guide through several phases.

In the end, the emphasis should be on achieving the goal through proper definition and not on sticking to a plan that has shown signs of failure in the journey towards achieving the goals.