MGT301: Change Management Report on HSBC's Organizational Changes

This report provides a comprehensive analysis of HSBC's change management initiatives. It begins with an executive summary outlining the report's objective: to understand HSBC's approach to change management. The report then delves into the context of the case study, detailing the bank's history and global presence. Key drivers for change at HSBC, including economic recession, governmental instability, fluctuating market trends, and the involvement of new technologies, are thoroughly discussed. The report examines the steps taken by HSBC to overcome resistance to change, including the four-step model adopted by the management. Furthermore, the report explores HSBC's consideration of the triple bottom line (TBL) and provides justification for its significance. The report concludes with recommendations for implementing better change management practices within HSBC. The report also includes an introduction and a detailed discussion section covering the case study, key drivers, steps taken to overcome resistance, and the triple bottom line. References are also included.

Running head: CHANGE MANAGEMENT
Change management for HSBC Case Study
Name of the Student
Name of the University
Author’s Note:

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Executive Summary
The main objective of this report is to understand about change management for the case
study of HSBC. Change management could easily incorporate various organizational tools,
which could be used for helping the individuals to make personal transitions for resulting in
the subsequent adoption or realization of changes. It even focuses on the individuals, effected
by the change. It is extremely important and significant to ensure that the strategies,
undertaken by the organization for change management are accurate and error free for
maintaining a proper balance within the business. This report has provided a detailed analysis
of the case study of HSBC, after identification of the key drivers for change and steps,
undertaken by them to remove resistance of change. Three appropriate recommendations are
also provided to implement better methods of change management in HSBC.

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Table of Contents
1. Introduction............................................................................................................................3
2. Discussion..............................................................................................................................3
2.1 Brief Idea of the Case Study............................................................................................3
2.2 Discussion of the Key Drivers for Change at HSBC.......................................................3
2.3 Steps taken by HSBC Management for Overcoming Resistance to Change with Proper
Justification............................................................................................................................5
2.4 HSBC concerning about Triple Bottom Line with Proper Justification..........................6
3. Conclusion..............................................................................................................................8
4. Recommendations..................................................................................................................8
References................................................................................................................................10

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1. Introduction
Change management can be referred to as the different approaches for the purpose of
preparation, supporting as well as helping all individuals, organizations and teams to bring
out organizational changes (Hayes, 2018). The organizational change management even
considers the entire company and requirement of such changes for checking the importance
of organizational transition. It also deals with several different disciplines from the social and
behavioural science towards business solutions and information technology (Doppelt, 2017).
The following report outlines a brief discussion on change management for the popular case
study of The Hong Kong and Shanghai Banking Corporation or HSBC regarding their
approach of change management with proper details related to key drivers for change, steps
taken for overcoming resistance to change, concern about triple bottom line and suitable
recommendations.
2. Discussion
2.1 Brief Idea of the Case Study
The Hong Kong and Shanghai Banking Corporation or HSBC is one of the most
popular and significant banks was established in the year of 1865 and has its headquarters in
London, United Kingdom. They have 9500 offices in the entire world and have been serving
the customer base of around 100 million with the help of several products and services within
the financial sector. There is a diversified range of factors like economic recession,
fluctuating market trends, newer technologies and government instability for bringing
changes in the business. During the year of 1998, they have devised a five year strategy,
known as MFV or Managing for Value for completing exploiting the globalized markets and
exceeding shareholder value. The organizational management has aimed at incrementing the
customer based and realignment of the value proposition as offered to the clients after
considering different measures like reduction of costs, automation of processes, enhanced
employee engagement and improvised service delivery. There was a negative attitude for
these changes, since few employees have resisted to the changes. For this particular purpose,
the respective management had developed a four step model.
2.2 Discussion of the Key Drivers for Change at HSBC
The organization of HSBC has eventually brought massive changes in their business
for ensuring that better effectiveness and efficiency is being incorporated without much
complexity (Cameron and Green, 2019). They have undergone the most significant changes

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in their organization after ensuring some of the most important and noteworthy range of
factors are being considered for getting high success in the business. The key drivers for
change in this particular organization of The Hong Kong and Shanghai Banking Corporation
are provided in the following paragraphs:
i) Economic Recession: The first and the foremost key driver for change in the
organization of HSBC is economic recession. It is the significant decline in economic activity
of the entire country, state or an organization (Kuipers et al., 2014). Such recession mainly
occurs by several events like a specific financial crisis, an adverse supply shock, huge
bursting of the economic bubble and an external trade shock. This particular condition
usually lasts for few months and is normally visible in real GDP, employment, wholesale
retail sales as well as industrial production (Hornstein, 2015). A major financial crisis was
erupted in the year of 2008 and hence HSBC had to take up few steps for increasing their
transparency and visibility to the customers. It was needed to bring change in the business for
successfully adopting various approaches.
ii) Governmental Instability: The second important and significant key driver for
change in the organization of HSBC is governmental instability. This type of instability can
be defined as the major potential for significant and sudden changes in the conditions,
policies and leadership of an entire country (Worley and Mohrman, 2014). The major
manifestation of such instability is the revolutionary activity and such changes in the
government, might be responsible for bringing various issues and complexities, related to
organizational management. As a result, it was required for the organization to adopt changes
in the business, for ensuring better effectiveness and efficiency in their services.
iii) Fluctuating Market Trends: Another significant and noteworthy key driver for
change in the organization of HSBC is fluctuating market trends (Goetsch and Davis, 2014).
Since, HSBC belongs to the banking sector, there are several chances for fluctuating market
trends. As a result, such trends have negative impacts on the banking sector or stock market
to a high level and for this particular purpose, they have faced issues related to such
situations. They have also implemented a new five years strategy, called MFV or Managing
for Value, so that they are able to completely exploit the globalized markets and also increase
shareholder value, as compared to the other banking organizations (Lines et al., 2015).
iv) Involvement of New Technologies: The next important and distinct key driver for
change in the organization of HSBC is involvement of few newer technologies. Since there is

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always a high growth in the technological field, it is required that such technologies are also
present within the business for bringing maximum success without any complexity (Alvesson
and Sveningsson, 2015). These technologies are also responsible for eradicating the existing
issues in the business successfully, related to lack of technology based growth and
development.
2.3 Steps taken by HSBC Management for Overcoming Resistance to Change with
Proper Justification
The management of HSBC has taken some of the most important and significant steps
to overcome resistance to changes after ensuring that all the existing issues are being
eradicated and major job satisfaction is obtained amongst the employees. As a result, there
would be an improved interaction within the staff and customers and these employees would
provide better performance in the organization (Lozano, Ceulemans and Seatter, 2015). They
have implemented few distinct changes in their business. However, it was being observed
that few of the employees were resisting to the changes, since they were not sure about the
success factor of those changes.
HSBC has implemented a five year strategy, known as MFV, so that they are able to
exploit the globalized markets and also increase shareholders’ value (Lozano, Nummert and
Ceulemans, 2016). The bank has also aimed in incrementing their customer base as well as
realignment of the value proposition. This was done by them after consideration of few
measures like reducing expenses, automation of the procedures, enhancement of the
employee engagement and many more. For reducing the issue related to employees’
resistance to change, the organizational management of HSBC has adopted a four step model,
which could easily and promptly address the issue of resistance to change (Ceulemans,
Lozano and Alonso-Almeida, 2015). The steps of this particular model are provided in the
following paragraphs:
i) Addressing Attitudes of Staff: The first significant step in the four step model,
adapted by HSBC is addressing different attitudes of staff. It is extremely important and
significant to ensure that the negative attitude of the employees towards organizational
changes are being well addressed in the company (Samuel, Found and Williams, 2015). As a
result, the employees would be able to understand the importance and significance of the
change to be brought in their business.

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ii) Highlighting Importance of MFV in their Regular Work: The second important
and significant step in the four step model, adapted by HSBC is highlighting major
importance of managing for value strategy in their regular work. The employees are needed
to be understand if the strategy would be useful for their daily work. As soon as they would
be able to understand the requirement of such change in the company (Deneen and Boud,
2014). It would help them in identifying as well as engagement with the organizational
management easily and high success is being gained.
iii) Employee Education about Company Progress in Implementation of Vital
Initiatives: The next important and significant step in the four step model, adapted by HSBC
is providing education to the staff. These employees are needed to be provided with proper
education and knowledge about the strategy, so that they became interested in the
organizational progress for deploying such important initiatives in their business (Wankhade
and Brinkman, 2014). The staff should have proper knowledge about the organizational
progress, so that issues related to change acceptance do not occur. They are also being trained
by the organizational management of HSBC.
iv) Motivating Employees in providing Feedback and Participate in change:
Another vital and noteworthy step in the four step model, adapted by HSBC is providing
subsequent motivation to the employees regarding providing feedback and also participation
in changes (Ziemba and Obłąk, 2015). Employee motivation is considered as one of the most
important and significant requirements in any specific company for being sure that the
employees are working as per their own willing and are quite happy with all the aspects,
present in the business (Cook, 2015). Any type of innovation or change could not brought
into the organization, if all the employees would not work properly. An organization can only
become successful when each and every staff would ensure 100 percent productivity. As a
result, HSBC has adopted this particular model, so that they are able to provide motivation to
the employees after providing feedback and also successful participation in the change
(Abrell-Vogel and Rowold, 2014).
2.4 HSBC concerning about Triple Bottom Line with Proper Justification
The most significant and noteworthy drivers of change in any particular organization
involve technological evolution, organizational restructuring, crisis, customer habit changes,
acquisitions, mergers and significant pressure from the new business entrants (Ceulemans,
Lozano and Alonso-Almeida, 2015). It also involves methodologies, which could redirect and

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redefine the overall utilization of resources, allocation of budgets, business procedures and
any other mode of operation, changing the business activities.
The organization of HSBC has successfully implemented change management after
concerning about the triple bottom line in their business. TBL or triple bottom line is a
specific accounting framework with 3 vital parts of social, ecological or environmental and
financial (Lozano, Nummert and Ceulemans, 2016). Several companies have adopted triple
bottom line framework for the core purpose of evaluating their performances in a wider
perspective and creation of better business value. Previously, the businesses used to focus on
only the bottom line for profit or loss and these were recorded after checking the statement of
expenses and revenue. This specific framework suggests that the organizations commit in
emphasizing on the environmental and social concerns, simply for ensuring higher profit
(Alvesson and Sveningsson, 2015). The corporation’s level of commitment towards corporate
social responsibility is being analysed and the effect over the business is needed to be
checked on top priority.
HSBC, being one of the most significant and noteworthy banking organizations in the
world, have eventually made their strategies and planning according to the needs and
requirements. They have considered different aspects and features, such as triple bottom line
or social, ecological or environmental and financial aspects in the business (Goetsch and
Davis, 2014). They have implemented MFV strategy in their organization and for the purpose
of measuring the effectiveness of this specific strategy, they have recruited the leading
change consultants in conducting their organizational wide socio psychological assessments
and studies. As a result, they were able to understand the social aspect of the business
successfully.
They have also faced the financial crisis of 2008 by leading to improvise the public
opinion and also boost customers’ confidence for trading with the banks. They decided to
increase the transparency and visibility of the banking processes by considering different
aspects of the business easily (Hornstein, 2015). For this purpose, they adopted a new
strategy for finding a balance within innovative and conservative business practices,
associated to credit lending. Various environmental sustainability programs like purchasing
green energy and financing renewable energy business as well as deployment of energy
efficient technology and lighting (Cameron and Green, 2019). The bank of HSBC has also
adopted programs for sustainability and has allocated 90 million US dollars to the Global

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Environmental Efficiency Programme and even has launched the HSBC Global Climate
Change Benchmark Index. Hence, they have also considered environmental part in the triple
bottom line.
During 2005, the organization decided to obtain higher competitive advantages and
hence they moved few of their business processes linked to the customer services,
technologies and sales to Brazil, China and India (Lozano, Ceulemans and Seatter, 2015). As
a result, they took a high risk in the form of initial capital investment from 20 million US
dollars to 30 million US dollars to set up within an off shore location. In spite of facing
financial losses in the business, they gained profit from the off shore location and became
successful. Hence, HSBC has also focused on the financial aspect for their business.
3. Conclusion
Therefore, from the above discussion, a conclusion could be drawn that change
management is the significant procedure, tool and technique for the purpose of managing the
people side of change in achieving a proper business result. This type of change management
might be utilized as the major alternative for the procedures of change controls, in which the
changes to the scope of the work are properly approved and introduced. The change
management in any specific company eventually employs a structured approach for the
purpose of being sure that the changes are being deployed successfully and properly for
obtaining the everlasting advantages. There are different reasons for change in any business,
such as innovation and globalization. The above provided report has appropriately outlined a
proper analysis of the change management in the distinct case study of HSBC with suitable
recommendations for better execution of their plan.
4. Recommendations
Suitable recommendations for HSBC Bank for better execution of their change
management plan are provided in the following paragraphs:
i) Proper Communication: The first and the foremost recommendation for HSBC
bank for effective execution of the plan of change management is proper communication with
the employees. It is extremely important and significant for all organizations to ensure that
every change and every aspect is being well communicated with the employees and staff, so
that they are able to understand the requirement of such changes in their business. HSBC,
before implementing their MFV strategy, the management of the respective bank did not

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consult or communicate with their employees and hence they faced resistance to change in
the business. It would also exhibit proper relation amongst the employees and organizational
management, apart from work meetings.
ii) Engagement with the Stakeholders: The second significant and important
recommendation for HSBC bank for effective execution of the plan of change management is
subsequent engagement with the stakeholders. It is the procedure, through which any specific
company could involve various individuals, who might be impacted by different decisions to
check the influence of such decision deployment. The organizational management should
engage with the stakeholders properly, so that they are able to understand the importance of
changes in the organization easily and promptly.
iii) Effectively Handling Resistance: The third distinct and suitable recommendation
for HSBC bank for effective execution of the plan of change management is effectively
handling employee resistance to change. Since resistance is considered as one of the most
common parts of the entire change procedure, it becomes nearly impossible to avoid such
circumstances and minimize the issues to a high level. It would be required for the
organization for ensuring that the employees in HSBC are accepting the changes without any
issue.

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