Change Management Analysis of Commonwealth Bank Australia

This presentation analyzes the change management issues faced by Commonwealth Bank Australia and offers recommendations to support the company in attaining sustainability. It includes literature review on change management, types of organizational change, managing change resistance, techniques in decreasing resistance, change, innovation and sustainability, change management issues, recommendations, and conclusion.

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CHANGE MANAGEMENT
ANALYSIS OF
COMMONWEALTH BANK
AUSTRALIA

Company’s Background Information
 Commonwealth bank is involved in offering integrated
financial services all over Australia, New Zealand and
in global market listed in ASX as renowned financial
institution.
 The bank provides premium, retail, funds
management, investment, superannuation along with
offering share broking services.
 The company has attained an increasing trend in its
revenue that is recorded to be 2600.5 crores AUD in
the year 2017 (Commonwealthbank.com.au. 2018).
 Market share price of Commonwealth Bank Australia
Group Limited is recorded to be 67.03 AUD as per
recent update in 2018.

Literature Review
Concept of Change Management and
Innovation
 Innovation can be explained as process of collaboration.
 Innovation is a process of change for creating highly effective
products, ideas and processes.
 Innovation in companies can be deemed as implementing new ideas
and developing existing services (Hornstein 2015).
 Change management includes tools, processes in managing people to
attain successful business results.
 Change management includes all the organizational tools which can
be used for facilitating people in making successful personal
transitions after implementation and adoption of change.
 Change management can facilitate in decreasing the impact of change
based instances such as service quality and everyday business
operations.

Literature Review
Types of Organizational Change
 Transformational or radical change
 Incremental change
 Developmental change
 Remedial change
 Transformational change
 Process and systems change
 People and culture change
 Structural change
 Merger or acquisition change
 De-merger change
 Relocation change
 De-merger change
Type of change to be implemented in the company depends on changing technology, economic
changes, new technology implementation, changing employee attitudes and changing
consumer needs and wants (Aarons et al. 2015).

Literature Review
Managing Change
Resistance
 Major causes of resistance is because
of habit, fear of loosing something that
is exposed and a belief that change
implemented is incompatible with
goals of organization.
 Using force-field analysis as indicated
in the figure can facilitate in decrease
change resistance (Sirén, Patel and
Wincent 2016).
 Increasing driving forces through
focusing on restructuring importance
can decrease fear of change among
employees.
 Negotiation can also manage change
resistance that involves engaging
something in value of change
agreement to decrease employee
barriers in affecting company’s change
effort.

Literature Review
Techniques in Decreasing Resistance
 Education and Communication- This can decrease change resistance
through facilitating employees in realizing the change effort logic.
 Participation- This involves considering individuals directly impacted by
proposed change within the process of decision making.
 Support and Facilitation- This facilitates in helping employees address
the anxiety and fear related with the effort of change. This can encompass
counseling, therapy and new skills training (Harmon, Green Jr and
Goodnight 2015).
 Manipulation- This process involves considering initiatives to influence
related employees regarding the change. This might also encompass
explaining facts in order to make change seem highly attractive.
 Coercion- This strategy can also be implemented in dealing with change
resistance. This considers implementation of direct threats or force against
resisters.

Literature Review
Change, Innovation and Sustainability
 Sustainability driven change or innovation involves
considering variables of social and environmental
impacts.
 Change management includes measurable targets tat
makes sure sustainability efforts of organizations are
sustained (Talke and Heidenreich 2014).
 In order to ensure sustainability, companies must
implement strategies related with innovation in
maintaining effective business operations.
 Sustainability servers as a great challenge as it must
necessitate implementation of revolutionary changes in
maintaining organizational profitability.

Change Management Issues
 Increased market pressure because of high competition in
maintaining net banking has weakened the management
structure of Commonwealth Bank Australia.
 The bank is facing system failures with poor risk and regulatory
framework affecting consumer investments.
 Lack of motivating among employees is challenging the
sustainability of the company (Kuipers et al. 2014).
 Poor change management policies are also observed to be
prevailing in Commonwealth Bank Australia that has lost
consumers faith on company’s change strategies.
 Lack of authority given to employees of Commonwealth Bank
Australia is affecting its long and short term change management
goals.

Change Management Issues
 Slowing consumer cycle due to lack of innovative banking
processes
 Non acceptance of visa cards turning out to be a challenge
 Poor transaction facilities in commbank merchant terminals
 As change management agents of Commonwealth Bank
Australia are ineffective there are certain issues related to
resistance of change from the side of employees (Hopkinson
et al. 2016).
 Improper circulation of the change message all through the
company has affected better understanding of activities
associated with effective communication among team
members regarding change management strategies.

Discussion of Issues
Lewin Change Model
 It includes three steps`; unfreeze,
change and freeze.
 Trough implementing the unfreezing
process Woolworths focused on
decreasing change resistance
barriers (Sirén, Patel and Wincent
2016).
 Unfreezing was done through
promoting or terminating employees
on structural level and through
offering training on new skills sets.
 In implementing change within its
online banking and visa service
offering process, employees were
highlighted about their own behavior
pattern as the employees were
observed to be demotivated in
accepting change in inventory
systems.

Discussion of Issues
Lewin Change Model
 Change aspect of this model considers implementation of the proposed change
management strategy in Commonwealth Bank Australia.
 Change aspect is challenged as Commonwealth Bank Australia as its online
banking services is poor causing issues with login and non-acceptance of cards.
 Commonwealth Bank Australia change strategy has also failed as rewards
offered by the company are not motivating its employees which is affecting quality
consumer service (Sirén, Patel and Wincent 2016).
 Unfreezing aspect in this model indicates stabilizing new changes through
ensuring that operating norms are at work and change barriers are addressed.
 In unfreezing stage Commonwealth Bank Australia observed that employees are
not supporting change taking place in the company through regular strike and
turnover.

Discussion of Issues
Kotter 8 Step Change Model
 This model is associated with Commonwealth Bank Australia
organizational changes as the company is observed to have
certain objectives in attaining growth.
 From analysis of this model, it is gathered that the
organization has issues in implementing communication
strategy in attaining objectives that can enhance capability of
employees to bring in organizational changes (Sirén, Patel
and Wincent 2016).
 The hierarchical change is not well implemented in the
company and in such situation of working style,
administrative changes and working surrounding changes.

Discussion of Issues

Recommendations
 Implementing problem centric approach to change is recommended
to Commonwealth Bank Australia that will focus on making certain
structural changes in the company’s management.
 The company is also recommended to conduct detailed research on
changed systems implemented within the online banking process.
 Commonwealth Bank Australia is recommended to ensure that
manager acts as trainer and offers training to employees for
acquiring new skill set as per the change.
 The role of change agent is not clear among the managers,
employees and HR professionals of Commonwealth Bank
Australia . Considering same, the company is recommended that
the manager must act as a consultant for employees in maintaining
close association with them for addressing barriers they face during
the change process.

Recommendations
 Commonwealth Bank Australia is also recommended
to employ external consultants those can guide
members of the company regarding ways in which it
can enhance its overall business operations.
 The company is also recommended to employ
effective change agents those can implement
suitable change management principles.
 To decrease employee change resistance, human
resource department of the company must follow
“changing leadership” through employing in-house
change specialist.

Conclusion
 The objective was to analyze the change management issues
faced by Commonwealth Bank Australia and to offer suitable
recommendations to support the company in attaining
sustainability.
 It was also gathered that change management can facilitate in
decreasing the impact of change based instances such as
service quality and everyday business operations.
 It was revealed that improper circulation of the change message
all through the company has affected better understanding of
activities associated with effective communication among team
members regarding change management strategies.
 Implementing problem centric approach to change is
recommended to Commonwealth Bank Australia that will focus on
making certain structural changes in the company’s management.

References
 Aarons, G.A., Ehrhart, M.G., Farahnak, L.R. and Hurlburt, M.S., 2015. Leadership and organizational change
for implementation (LOCI): a randomized mixed method pilot study of a leadership and organization
development intervention for evidence-based practice implementation. Implementation Science, 10(1), p.11.
 Commonwealthbank.com.au. 2018 com.au., 2018. [online] Available at: https://www.
Commonwealthbank.com.au. 2018 com.au/icms_docs/195396_annual-report-2018.pdf [Accessed 13
Oct. 2018].
 Harmon, D.J., Green Jr, S.E. and Goodnight, G.T., 2015. A model of rhetorical legitimation: The structure of
communication and cognition underlying institutional maintenance and change. Academy of Management
Review, 40(1), pp.76-95.
 Hopkinson, P., Zils, M., Hawkins, P. and Ellen MacArthur Foundation, 2016. Challenges and capabilities for
scaling up circular economy business models. A change management perspective. Ellen MacArthur
Foundation (Ed.), A new dynamic, 2, pp.157-176.
 Hornstein, H.A., 2015. The integration of project management and organizational change management is now
a necessity. International Journal of Project Management, 33(2), pp.291-298.
 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.
 Sirén, C., Patel, P.C. and Wincent, J., 2016. How do harmonious passion and obsessive passion moderate the
influence of a CEO's change-oriented leadership on company performance?. The Leadership
Quarterly, 27(4), pp.653-670.
 Talke, K. and Heidenreich, S., 2014. How to overcome pro‐change bias: incorporating passive and active
innovation resistance in innovation decision models. Journal of Product Innovation Management, 31(5),
pp.894-907.