An Analysis of Leadership and Motivation in OCBC Bank

This report provides a comprehensive analysis of leadership, performance management, and motivation within OCBC Bank. It begins with an introduction outlining the report's objectives, which include examining leadership styles and their impact on the organization. The report delves into two key leadership theories: the Fiedler leadership model and the Leader-Member Exchange (LMX) theory, applying them to identify the leadership style employed by OCBC Bank. It then discusses the contributions of this leadership style to the organization's overall performance, assessing its effectiveness. The second part of the report focuses on the performance management and motivation systems in place at OCBC Bank, evaluating their effectiveness in encouraging and rewarding performance and ethical behavior. The report concludes with a critical evaluation of the strengths and weaknesses of the organization's chosen performance management, motivation, and reward systems, offering insights into their impact on employee behavior and organizational success. The analysis incorporates practical examples and observations, including the qualities of the OCBC Bank's Chief Executive, to provide a real-world context.

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Organization

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Table of Contents
Introduction...........................................................................................................................................3
Overview of the company......................................................................................................................4
Task 1....................................................................................................................................................4
Fiedler leadership model....................................................................................................................5
Leader-member exchange (LMX) theory..........................................................................................6
Contribution of leadership style towards the organization.....................................................................7
Task 2....................................................................................................................................................8
Performance management and motivation system used by the organization.....................................8
Effectiveness or ineffectiveness of Performance management and motivation system used by the
organization.....................................................................................................................................10
Critical evaluation of strength and weakness of the performance management, motivation and
reward system opted by the organization (Are they effective in encouraging and rewarding
performance and ethical behavior)...................................................................................................11
Conclusion...........................................................................................................................................12
References...........................................................................................................................................13

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Introduction
The purpose of the report is to develop an understanding of leadership, management, and
motivation in context of OCBC Bank. The report is divided into two parts. The first part
provides an understanding of two different theories of leaderships which can be used for
indentifying the style of leadership adopted by the OCBC bank. The report further discusses
the contribution of style of leadership in context to the organization. It evaluates whether the
leadership approach adopted by the organization is effective or not. The second part of the
report provides an understanding of the system of performance management and motivation
adopted by the organization. It further evaluates whether the approach of management,
motivation, rewarding system used by the organization is effective or not. In order to make
understanding in practical manner the qualities of Chief Executive of OCBC Bank are
discussed in the report.

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Overview of the company
OCBC Bank was established in the year 1932 by the amalgamation of former three banks
namely Ho Hong Bank, Chinese Commercial Bank, and Oversea-Chinese Bank. OCBC Bank
is the Singapore’s third biggest bank. It has now become the second largest group of financial
services in Southeast Asia. OCBC is one of the high rated banks in the world. According to
Moody’s, the bank is well known for its stability and financial strength. OCBC Bank is
ranked consistently among the top 50 banks of the world by Global Finance. OCBC Bank is
engaged in the broad array of services including commercial, private, and consumer banking,
services related to wealth management, capital marketing, stock broking services, and assets
management (OCBC Bank, 2018). In order to achieve growth and success in future the bank
has developed mission and vision statement and operates its business with an aim to achieve
both. The vision statement of the bank states that it wants to become the bank of choice with
world class standards and shall be recognized for trustworthiness and caring. Likewise, the
mission statement of the brand states that the bank will help businesses and individual across
different communities to achieve their aspirations through their innovative financial services
according the needs of businesses and individuals (OCBC Bank, 2018).
Task 1
Leadership practice is an essential part of the organizations operating at national and
international level. It is a process through which one person influences the actions and psyche
of other in order to get an objective accomplished. Bank directors set up targets of sales for
each branch and every divides the work within different departments accordingly. In growth
and success in the banking sector can only be achieved if the targets of sales and back-office
work are timely achieved. An effective leadership plays an important role in directing the
employees for successful completion of targets on time. Different leaders use different style

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of leadership according to their knowledge, character, qualities, and need of the organization
(Day, et al., 2014). Every organization has leaders which possess different traits. In order to
identify the leadership style used by The OCBC Bank two of the following leadership
theories are use:
Fiedler leadership model
This model was created by Fred Fiedler in mid-1960s for studying the characteristics and
personality of the leaders. According to this model, the best style for leadership cannot be the
only one. Rather, effectiveness of a leader is dependent on how he reacts to different
situations differently. The resultant leadership is based on two factors – style of leadership
and favorableness of the situation (Lu, et al., 2017). The following three steps are used in this
model for identifying the leadership:
Step 1: Identification of traits of leader
In order to identify the leader’s attitude, a scale of least preferred co-worker (LPC) is created
by Fiedler. The leaders are then asked that what kind of person they would like to work with.
The scale consists of 16 different items along with rating to reflect the deposition of leader
towards other. The items in the scale includes rejecting/accepting, unfriendly/friendly,
unpleasant/pleasant, tense/relaxed, boring/interesting, cold/warm, uncooperative/cooperative,
backbiting/loyal, guarded/open, hostile/supportive, unkind/kind, insincere/sincere,
untrustworthy/trustworthy, inconsiderate/considerate, gloomy/cheerful, and
quarrelsome/harmonious (Bulgaru, 2015). If the score of LPC scale is low then the leader is
considered as task oriented. On the contrary, if the score is high then the leader will be
considered as relationship-oriented. From the LPC scale it was analyzed that the leader
possesses an average score which suggest that a relationship-oriented approach is used along
with a little focus on completion of task.
Step 2: Favorableness of situation

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It is dependent on three factors:
Leader-member relation: It depicts the degree of likeliness of employees toward the leader
and willingness to follow him.
Task structure: It depicts the degree to which the tasks are described to employees in
structured manner.
Position of power: It depicts the degree to which the authority can be exercised by the leader.
Step 3: Effectiveness of leadership
The effectiveness of the leadership is determined on the basis of behavior of the leader and
situational characteristics favorable. When the relationship between leader and member is
good, tasks are defined in structured way, and the authority position of leader is strong then
the situation is considered to be favorable (Amanchukwu, et al., 2015).
It was analyzed from the interview that the leaders shows task-oriented behavior when the
situation is favorable and shows relationship-oriented behavior when the situation is
unfavorable. Therefore, the leader can be considered as relationship-oriented.
Leader-member exchange (LMX) theory
According to this theory, leaders acts differently with different subordinates within a group.
The relationship quality is dependent on the degree of loyalty, mutual trust, respect, support,
and obligation. The group members are differentiated between in-group and out-group based
on gender, age, and personality. The members who are favored the most are known as in-
group members. (Plotner, et al., 2015).The relationship between the leader and member is
built in following stages:
Role taking
When the organization is joined by a new member then his abilities and talent are assessed
and opportunities are offered to them so that capabilities can be demonstrated by them.
Role making

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An unstructured and informal negotiation on factors related to work is created between
member and the leader. If the member posses similar characteristics as that of leader then he
is likely to succeed more.
The LMX 7 scale is used to determine the mutual trust, respect, and obligation towards each
other (Dysvik, et al., 2015). The analysis of these dimensions determines whether the
member will be a part of out-group or in-group.
It is analyzed from the interview that most of members with a group exchange good leader-
member relationship. Therefore, most of them are in-group members and they tend to
function like advisors or assistants. Due to this reason, it can be observed that the leaders
have higher quality of personal exchanges with the group member that enables them to make
assignments into interesting tasks, delegate significant responsibilities, share information,
involve members in the decisions and benefit them in case of favorable schedules of work
and support them personally as well.
Contribution of leadership style towards the organization
According to the characteristics and nature of the leader observed from the above analysis it
can be said that a combination of transformational and transactional style of leadership is
followed within the OCBC Bank. Both transformational and transactional styles of
leaderships are important to the organization in equal manner. The transactional style of
leadership is focused towards the accomplishment of work assigned to the employees (Dong,
et al., 2015). Whereas, the transformational style of leadership put more emphasis on taking
initiatives which can make the tasks more interesting and significant. By using the
transformational leadership, leaders try to succeed in the work by letting the group member
know about the penalties which could be implemented on them if in case the desired targets
are not achieved. They also aid the employees in achieving higher performance level by
foretelling about the commitment towards organizational goals of OCBC Bank. They push

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the employees towards achievement of organizational goals by inspiring them and giving
them a clear insight of the future in terms of both reward and penalties (Sosik and Jung,
2018). Transformational approach seems to be an all round approach. The employees are
encouraged to think critically as they get inspired form their leaders. This is because the
leaders have a strong vision, and they are motivating and charismatic. In transformational
leadership, the compensation is geared towards the results which are long-term. On the other
hand, the use of transactional leadership put emphasis on reward, work, and process which
enables consistency in results (Kark, et al., 2018). The approach is result- oriented and proves
to be beneficial for the business. It is unlike autocratic style which is harsh on the employees
but considers poor performance and penalized them.
Both the approaches are effective for OCBC Bank due to several reasons. Firstly, the friendly
relationship between the members and leader aids in clear demonstration of how the tasks are
required to be done which improves the efficiency and effectiveness of the work. Moreover
adequate support is provided to the members. For instance, if there is any problem with the
transactions of any customer like the money is deducted without any notice and the employee
is not able to provide any justifiable reason for that the issue is often resolved at managerial
level. Apart from this, these leaderships approach tends to provide more work satisfaction
within the employees and thereby reduces the employee turnover rate which supports OCBC
Bank in terms of increased performance and reduced expenditure for hiring and training new
personnel (Choi, et al., 2016).
Task 2
Performance management and motivation system used by the organization
It is essential for the business to evaluate the performance of the employees on a regular basis
and motivate them to carry out the activities in an effective and efficient manner. Nowadays,
companies consider employees as their vital assets as they make significant contribution in

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the organization towards the achievement of the goal. Companies are adopting different
methods to evaluate the performance and increasing the level of motivation of the employees
in order to retain skilled employees. Companies are also engaging employees in the decision
making process by considering their views and opinions in order to cater their different needs
in an effective manner. Companies adopt different methods to motivate employees to
increase their productivity in the organization by providing them flexibility to work which
help employees to maintain a balance between work and family life (Armstrong and Taylor,
2014).
Apart from this, companies are also providing rewards to the employees for their excellent
performance in the organization which in turn facilitates in increasing their commitment level
in the organization. Besides this, in order to evaluate the performance of the employees, there
are different methods that can be adopted by the companies such as 360 degree feedback,
personal development plan, management by objectives, reward and recognition programs and
so on (Gerrish, 2016).
In context of OCBC Bank, the company has adopted 360 degree feedback method in which
the managers take the feedback from different employees, senior managers, customers and so
on for different aspects which in turn helps in evaluation of the different factors that influence
the performance of the employees. Besides this, regular meetings have been carried out with
the employees and consider their views and opinions related to the problems faced by them
and providing them solutions which helps in building trust and loyalty among them towards
the organization (Kalra, 2016).
It is identified that OCBC bank has inherited the culture for supporting and caring people and
being considered as the greatest assets in order to fulfill their personal and professional
development needs. The company has conducted different programs for catering to the
different needs of the employees The different programs established by the company include

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work life program introduced in the year 2004 that focuses on wellness, community and
family such as Employee Resource Groups, Career Break Scheme, PSLE Leave Scheme and
in house childcare centre. The company has also adopted 360 degree feedback method to
evaluate the performance of the employees by the way of considering the views and opinions
of the experiences with other employees and influence on their behavior that helps in the
assessment of the performance in an effective manner (Kalra, 2016).
The company has also adopted the balanced scorecard technique to measure the performance
of the employees and helps in formulating of the strategies that can be adopted to solve the
problems in an effective manner. OCBC bank also provides rewards to its employees in both
the forms i.e. monetary and non-monetary. Besides this, the company also provides an
opportunity to its employees to share information with other colleagues which in turn helps in
the development of new skills and abilities that are needed to carry out the activities in an
effective manner (Kalra, 2016).
Effectiveness or ineffectiveness of Performance management and motivation system used by
the organization
The different performance management and motivation systems that are being used by OCBC
are effective. The main reason behind it is that these methods help in assessing the needs and
requirements of the employees for the purpose of catering to them appropriately. The
provision of the opportunity to the employees to take participation in the decision making
process is effective as it helps in the formulation of the strategies that could be adopted by the
company to attain a competitive advantage over other players in the market. The provision of
the rewards and assigning the challenging tasks to the employees results in the development
of the skills and abilities and improves the level of commitment and loyalty of the employees
(Van Dooren, Bouckaert and Halligan, 2015). These methods are effective as it helps in
providing support to the employees to make a balance between their work and personal life
by providing services to parents with special need children, single parents and so on which in

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turn facilitates in improving the performance and productivity of the employees. This also
helps in increasing the satisfaction level of the customers in an effective manner.
OCBC is a first bank of Singapore that have introduced an in-house childcare centre and
PSLE Leave scheme for the purpose of fulfilling or taking into concern the needs of the
employees. The company also uses balanced scorecard which helps in measuring of the
performance of the organization from different perspective which in turn facilitates in
bringing change in the strategy to be adopted to achieve the goal of the business. The
adoption of the management by objective method helps in providing opportunity to the
employees to make quick decisions and the decision on important matters have been carried
out by the top level management (Barrick, Thurgood, Smith and Courtright, 2015). The
provision of monetary rewards to employees for increasing their level of motivation is a win-
win situation for both as employees can fulfill their basic needs and improves their standard
of living. In addition to this, increase in the productivity of the employees results in
increasing the level of sales of the company and increases their profitability.
Critical evaluation of strength and weakness of the performance management, motivation and
reward system opted by the organization (Are they effective in encouraging and rewarding
performance and ethical behavior).
The strengths of the performance management, reward and motivation system are that these
methods are simple to use, easy to quantify and includes different perspectives. Along with
this, the other strength is that it involves the engagement and participation of the employees
in the decision making process which helps in the creation of the sense of belongingness and
commitment and loyalty towards the organization. The other benefit of the adoption of these
methods is that it helps in the building of the cohesive work environment as it takes into
consideration the potential problems that can be faced by the employees and provide them the
solution for the same which helps in encouraging them to improve their performance in order
to attain the goal of the business (Chuang, Jackson and Jiang, 2016).

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The provision of the training by the company to increase the motivation level of the
employees helps in reducing the reluctance of the employees towards the changes
implemented by the company in different processes and procedures. For this purpose, there is
a requirement of the communication of the relevant information to the employees in order to
build trust and loyalty among them. Along with this, the weakness of the performance
management, motivation and reward system are there is a presence of consumption of the
increased time, discouragement, inconsistent message and biasness. If the system is not
properly executed or the employees do not have good experience then it would result in the
decreasing the motivation level of the employees and thereby there is an occurrence of
increased absenteeism (Upadhaya, Munir and Blount, 2014). This might also has a negative
impact on the performance and productivity of the employees in the organization. It is also
required by the managers to keep a record of the behavior of the employees in the
organization in a consistent manner in order to convey accurate information to them which
helps in directing their efforts towards the achievement of the goal of the organization.
Conclusion
It can be concluded that leaders play an important role in the achievement of the goal of the
business in an effective manner. The different leadership models use by the organization to
implement effective leadership include leader-member exchange in which the leader provides
the opportunity to the employees to contribute towards the decision making process by
presenting their views and opinions in an effective manner. It can also be summarized that the
company has adopted different methods for the evaluation of the performance of the
employees such as 360 degree feedback and so on which in turn helps in the evaluation of the
diverse needs of the employees that are required to be catered by them in an effective
manner.