GSGM7223 - Mybank: A Case Study on Organizational Change Analysis

This case study examines Mybank's experiences with organizational change, focusing on both bottom-up and top-down approaches to implementing new strategies. The bottom-up approach, initiated in the 1990s, involved quality improvement teams comprised of general staff identifying and rectifying inefficient work systems. While some employees embraced the initiative, enthusiasm waned due to work overload and management's reluctance to accept recommendations. Later, a top-down approach was implemented to address cost structure issues, with senior managers playing a major role in identifying problems and specifying improvements. This approach also faced resistance from middle management. The case highlights the challenges and complexities of organizational change within Mybank, including the importance of management support and employee involvement. Desklib offers this case study and many other resources to aid students in their studies.

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Managing Organisation Mybank A CASE
Study ON Organizational Change
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GSGM7223 MANAGING ORGANISATION
Case Study (20%)
MYBANK: A CASE STUDY ON ORGANIZATIONAL CHANGE
The bottom-up approach to change
During the 1990s, one of the senior executives of Mybank became convinced of the benefits of a quality
improvement program for reducing costs in forming quality improvement teams to identify and rectify
inefficient work systems through the elimination of waste and rework. The attraction of such an initiative also
stemmed from its potential to achieve cost reduction in-house, using existing staff to improve quality and
customer service as well as offering the organization an ongoing methodology for continuous improvement.
In embarking on change, the implementation strategy adopted was as follows: an outside consultant was used to
introduce the philosophy and tools of the change program to senior and middle managers in a series of
workshops. Once familiar with the concepts and principles, these managers were then expected to encourage
their staff to form quality improvement teams to solve specific work problems identified by either the general
staff or managers. The involvement of general staff was seen as a crucial issue: operational staff were seen to be
intimately acquainted with their own work processes and thus ideally placed to recognise existing inefficiencies
and to make recommendations to rectify them. In order to assist in the implementation process, a quality
support group of two people was established to provide training and facilitation for general staff involved in
quality improvement projects. In time, it was hoped, the philosophy and methodology of continuous
improvement would become an integral part of everybody’s job. This model relied on a bottom-up approach
based on operative staff involvement with support from management. As one manager expressed it
‘Management’s role was to support and to encourage it rather than be involved in it.’ As It turned out, this
initiative was only fully implemented and operationalised in a limited number of areas (mainly in departments
with routinised administrative tasks).
Participation in quality improvement teams was voluntary and comprised five to ten intra-department general
staff and a quality coordinator from the quality support department. The role of the quality coordinator was to
act as a facilitator, mediator and trainer for the team. Once a problem had been identified, the team would
consult with any persons or departments that either used the output to the work system or supplied input into
the system. The team would then identify possible inefficiencies, analyze these may occur and then make
recommendations to management as to how the system could be improved. Interestingly, the views of general
staff about the new initiative were polarized: they either hated it or loved it. Those that hated it either did not
want to be involved, did not understand it, or were simply happy just to get on with their own work. As a
supervisor put it: ‘They do not want to get involved. They just want to do their 40 hours.’
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Employees who embraced the initiative was particularly excited about being given the opportunity to contribute
to the construction of their own work organization. As one staff member recalled: ‘I have never worked in an
organization (until this one) that wanted to hear the input of ……those down the bottom.’ Other staff expressed
initial trepidation but once involved became active supporters: ‘it was absolutely terrific, it improved our
system there, 100 percent, 150 percent. It’s great!’. In part, the enthusiasm of some employees can be explained
by the material improvement in their working lives:
I was working overtime, at times, back until 7.30, 8.00 o’clock at night and he (the manager) told me I had to
take three days off all my work, forget about it totally and go into this room and do this thing. Oh my God, I am
going to be here till doomsday, trying to fix these things up. It took three days, and it was great. It made such a
difference that we stopped doing overtime. It was amazing. Helped us out tremendously.
Indeed, so successful were some projects that operations or procedures that had taken weeks were reduced to a
matter of days. However, even among the most ardent supporters, enthusiasm soon waned. This was due to two
factors. First, employees were still expected to complete all their other tasks in addition to the work required by
the change projects. Consequently, improvement meetings that lasted one or two hours could result in
quantitative work overload. Even managers who were supportive recognised this problem, as one stated: ‘The
resistance you get is “Hey! When do I have to do this by, I am flat strapped now!” The second factor that
caused disillusionment among employees was that management rarely accepted their recommendations for
improvements. This was seen to be particularly frustrating given the time, effort and enthusiasm many staff had
put into projects. As one employee explained:
I was leading a project ….. looking at our relationship with builders and under construction loans in general.
We saw it through to completion : we had some recommendations that we thought were good ones. Some of
them were put in place but the major ones were not. Upper levels of senior management in the bank decided
that it was not the way to go, and we were not going to do that. That was really running into a brick wall.
The non-linear process of change
The failure for the change initiative to be adopted in many areas of the organization was due to a number of
reasons. The most important was the reluctance of senior and middle managers to actively support the change.
They were skeptical about the initiative and felt that it was better suited to the manufacturing sector rather than
financial service operations (one more open-minded manager did concede that the initiative could have some
use in administrative areas of the organization). As one manager expressed: ‘We are more administrative than a
lot of other areas and therefore responded to it a little bit better than other parts of the branch.’ Many managers
were of the opinion that their departments were already over-worked and simply could not afford to allow their
staff to take time off to become involved in this change initiative. For some, the acceptance of change implicitly
at least, that managers recognised that their departments were currently inefficient and improvements were
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possible. Interestingly, one of the most common reasons expressed for the lack of adoption was the lack of
commitment from top management. As one person put it:
They (management) agree that they understand the concept, that they felt It is necessary and they see the
advantages, but when it comes to the role- modelling or leading or doing, they back away at a million miles an
hour. Maybe they have got too much real work to do, maybe they do not really understand anyway….. I do not
believe that we have still passed the first step. That is, have a common understanding at the top and a total
commitment.
The Managing Director also played a part in influencing the process of change. He had a relaxed management
style and assumed that departments would become involved in quality improvement projects on their own
accord. Participation was not mandatory. Although this ‘friendly and open management style imbued the
organization with a strong culture of family values based on respect for the individual, many people also
interpreted it as a lack for support from twin effects of limited senior management support and middle
management resistance meats that the initiative had ground to a halt.
The top-down approach to change
In 2003, senior management decided to once again review the company’s cost structure. Mybank had
committed themselves to building a new corporate headquarters and the prospect of this major financial outlay
plus the firm’s continuing high level of operating expenses stimulated the firm to seek cost savings. The firm
brought in a large accounting firm to examine the company’s operations and to make recommendations on how
best to reduce costs and improve performance. In an almost identical fashion to events previously, the firm
elected to use an employee involvement initiative to achieve the potential cost savings identified by the
consultant group. However, on this occasion the bank adopted a top-down rather than the bottom-up approach
to the implementation of change. A consultant was brought in from America to help the organization with their
implementation strategy. The consultant recommended that senior managers play a major role in the change
initiative. Their role was to identify organizational problems and the likely causes, specify how improvements
in performance were to be measured and what the acceptable level of performance would be, nominate
individuals to analyze and rectify the problems, and specify timeframes. The implementation strategy was
expected to motivate middle managers through highlighting the commitment of senior management in practice,
however, this top-down approach also had its difficulties.
The General Manager of Retail Banking illustrates an example of some of these problems in using a top-down
approach to amalgamate two of his lending sections. The bank had two personal lending sections: a housing
loans section, and a consumer loans section for credit cards, overdrafts and personal loans. Within the
established banks there would normally only be one lending section which would process both types of loans.
The disadvantages of having two separate sections were that many personal clients would often have both types
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of loans. Thus, having their records spread across two separate sections led to duplication and created
administrative problems for the management of clients’ accounts.
In addition to the integration of two departments, the General Managers also elected to introduce a new
management layer that had experience with both forms of lending. Traditionally, staff in the housing loans
section knew little or nothing about personal lending and vice versa. Consequently, managers experienced in
both forms of lending were recruited and located between supervisory audits and the Departmental Manager,
with the title of Regional Lending Managers. However, rather than physically combine the two areas in one
location and develop training systems to allow the multi-skilling of staff over time, the task of integration was
seen to provide the bank with an ideal opportunity to critically examine the whole structure of work systems in
order to eliminate unproductive tasks and perhaps reduce staff levels. As such, the integration of the two
departments became a major change project.
Four newly appointed Regional Lending Managers were given the task by the General Manager of
amalgamating the departments to ensure that the new process became operational within a six-month
timeframe. The group discussed and formulated and implementation strategy through consultation with
employees in both departments to establish the timing and range of functions and tasks performed. Each task
was then scrutinized to determine whether it was ‘value-adding’, ‘rework’ or ‘non-valuing’. Where possible
tasks that were classified as ‘rework’ or ‘non-value’ adding were eliminated. The remaining work tasks were
then flow-charted and bunches of related tasks, lumped together to form new jobs. Staff were then allocated to
these new jobs. The redesigned process reduced staff numbers by eight. The bank had a policy of not
retrenching people, and those personally eliminated from the new system either found alternative positions
within the bank or they were kept on as ‘floating’ staff until they were able to find positions elsewhere.
Although the project was given total support from the General Manager, the new Regional Lending Managers
experienced a lot of middle management resistance. For example, some of the Departmental Managers
immediately superior to the Regional Lending Managers strongly resisted their proposed redesign of work
organization. These managers were intimately acquainted with the old processes and felt that the new design
was at best unrealistic and at worst unworkable. This middle managerial resistance slowed down the progress
of the change and acted as a major barrier to securing outcomes within the six-month timeframe. In the case of
two managers their obstruction was so harmful to the project that they were relieved of their posts. The effect
on staff morale was quite devastating. Both managers were liked and respected by their staff. One, in particular,
had spent almost his entire working life with the organization and the way he was treated was highly disturbing
for other staff. As one employee put it:
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You know, even us, we are sort of thinking. ‘Well, I have been with the bank for 15 years … and look what they
did to Garry. They were not very kind to him. How are they going to be with me?
Staff morale had also deteriorated because of the way in which general staff and supervisors were consulted
about the design of the new system. As one change agent pointed out:
We simply could not have involved everyone in the re-organization of retail lending. No one could think of a
way to do that because everyone would have a different idea of the way it should be. It would have got too big.
So we decided to use a small team.
This top-down approach to change offended many of the general staff, especially those who had previously
been actively involved in the earlier bottom-up change projects. Once again, the implementation of change did
not prove successful, only this time the strategy adopted by senior management had failed in its intentions to
mobilize middle management commitment and local staff enthusiasm. In the words of one general staff
member who had been a very active participator in the bottom-up approach:
Whereas before people used to be involved and we were having hassles trying to convince the people that were
up there (management) to get involved. Now it seems to be them, up there, just telling, like a Hitler type of
situation, telling these people, down here ‘This is what you are to do!’
Question 1
With reference to the case study, discuss TWO (2) advantages and TWO (2) disadvantages of a bottom-up and
top-down approach to change implementation. (6 Marks)
Question 2
Analyze the importance of employee commitment of this organization to the successful management of change.
Justify with TWO (2) relevant points. (4 Marks)
Question 3
Evaluate whether the Managing Director served as an ‘inhibitor’ or ‘facilitator’ of change and evaluate the
effects that this may have had on the introduction of the various change initiatives. (6 Marks)
Question 4
Imagine you are one of the key personnel of Mybank. Discuss an action you would want to undertake before
change implementation. (4 Marks)
*** END OF CASE STUDY QUESTIONS ***
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GSGM1234 MANAGING ORGANISTION (MC-011)
MYBANK: A CASE STUDY ON ORGANIZATIONAL CHANGE
Submitted by:-
Amy Mastura (MC 210117045)
[phone]
Submitted to:-
Assoc. Prof. Siti Nurhaliza
Senior Lecturer
Submitted on:- 5 June 2030
Question 1a) Advantages of bottom-up approach:-
a) Improved employee motivation
The implementation of the bottom-up approach leverages all its employee's perceptions of business and
ideas for the company. In this case, the top management gave the responsibilities and opportunity to the
entire team to participate and contribute to the company’s management and decision-making process
regardless of their seniority. Such factors affect the motivational levels of the employee. Employees will
feel appreciated and that their opinions are valued which fosters a supportive and communicative
environment where employees can thrive and grow together. As a result, they will feel motivated and will
do their best to work on their projects. Also most importantly there will be a greater buying-in process by
the employee as they will be part of the changes all the way which will enable the new work processes to
be better implemented by the employee with a sense of belonging.
b) Fast decision making and better collaboration that will lead to better performance and productivity
As the lower level of employee were involved in the quality improvement project, they are able to list
processes which can be eliminated or improved on which not be visible from the top management
perspective. They are intimately acquainted with their own work processes. It would be easy for them to
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identify inefficiencies in their work processes and how to rectify them. With a bottom-up approach,
everyone in the company becomes an essential source of knowledge, in the areas where they specialize.
Rather than waiting for top-level management to come up with new ideas, employees will feel involved in
the innovation process and actively contribute to improving products, services, and procedures.
As example, those who work directly on projects and oversee project management can liase with other
department on the decisions that will impact their future work and to exchange ideas that will improve their
work. They can create opportunities for feedback, brainstorming, and constructive criticism that often lead
to better systems and outcomes. It helps improve employee collaboration as everyone is involved in the
decision-making process and has input into how things are done. The company will be more likely to
improve productivity. As there a greater communication and feedback from those involved in the project
task, they are able to identify the risk and problems of the company as they arise, which will result in
quicker problem solving and more efficient solutions. When employees are empowered to make decisions,
internal changes and innovation can happen faster and employees will feel involved in the innovation
process and actively contribute to improving products, services, and procedures.
Question 1b):- Disadvantages of bottom-up approach:-
a) Employee will be over burdened or over workload
As this lower level employee were expected to come up with improvements to their existing processes while
busy doing their existing day to day work thus making them feel over worked or over burdened. Employees
are away from their own tasks to work for the quality improvement program causing them to lose precious
time. When they under pressure due to the heavy workload, they tend to make more errors, and affect their
performance. This eventually will cause fatigue and stress. If this is not being addressed properly, it will
affect the organisation performance and ultimately decreases the organization’s overall productivity and
revenue.
b) Decrease employee motivation and morale
Frustration is bound to happen when these lower-level employee come up with all kinds of
recommendations to enhance the delivery process, but these ideas or proposals are not accepted or
implemented by the top management. This situation can be very frustrating given the time sacrificed, effort
as well as enthusiasm which many employee had put into the productivity enhancement projects. The
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employees will lost interest in their job and future projects as they have lost their trust to the management.
This will affect their motivation at work and lead to low performance, poor communication and high
turnover.
c) Employees suggestions and recommendations might not align with company goals
The management only support and encourage them but not being involve in the decision making. Allowing
all employees to engage in decision-making does have possible pitfalls. Becoming engaged in the process
can bog down employees and lead to too many unproven ideas being suggested. Since general employees
don’t have access to high-level insights, they might not be able to identify and set goals that are truly
aligned with the company strategy, business’s mission and long-term vision. Results will never quite match
the top management expectations, as they never discussed the project with the general employee to ensure
they fully understood it or had a chance to provide constructive feedback. This could lead to significant
divides between employees and the management as well as possible conflict that may have a negative
effect on productivity.
Question 1c) Advantages of top-down approach:-
a) Possible to eliminate the non-value adding process and reduce operational cost
The implementation strategy will be able to identify ‘value-adding’, ‘rework’ or ‘non-valuing’ task where
possible tasks that were classified as ‘rework’ or ‘non-value’ adding were eliminated. The redesigned
process will give some ideas to reduce some staff that do redundance work. This will eventually help the
organisation to reduce the operational cost. The employees are expected to multi-tasking to reduce
overlapping of roles and reduce the operation cost. Where possible tasks that were classified as ‘rework’ or
‘non-value’ adding were eliminated. As the top management has a helicopter view of the entire processes,
they are able to propose the elimination of non-value adding processes which will enhance the
competitiveness of the bank
b) Fast decision-making process
The advantage of this approach is that decisions can be made by the top management and being escalated to
the employees for the immediate implementation. This will save time and cost.
Question 1d) Disadvantages of top-down approach:-
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1. Top-down approach can be viewed as bossy or dictatorial – autocratic leadership
Employees can grow resentful and challenge unilateral decisions as the final decision being handed down
to them without asking for their ideas towards accomplishing the company goals. This will be seen as
autocratic or dictatorial leadership. This autocratic leadership is not best for businesses struggling to
implement change effectively. With only the senior executives making decisions, their conclusions may be
seen as lacking creativity and being harmful to overall performance. The middle management and local
employee feel that they are being instructed on what to do. When the lower level of employee feel that they
are given detailed instructions on how best to improve their work processes, then the buying in from the
lower-level employee will not be high and that will affect the effectiveness of the implementation of the
revamped work processes. The employees don’t give full support and commitment towards the top-down
approach as they feel that the top are not willing to listen to lower-level employees’ ideas, suggestions or
feedback, resulting to poor employee motivation and performance.
2. Decrease employee morale and motivation
This top-down approach to change offended many of the general staff, especially those who had previously
been actively involved in the earlier bottom-up change projects. They didn’t give a full support or full
commitment towards this approach due to trust issues, low morale and motivation. The general employee
and supervisors were generally not adequately consulted about the design of the new work system. In most
banks it's the lower level who knows more about the operational aspects which may be revised or improved
on.
3. Restructuring could possibly reduce employees at all levels
The task of integration was seen to provide the bank with an ideal opportunity to critically examine the
whole structure of work systems in order to eliminate unproductive tasks. The employees are expected to
multi-tasking to reduce overlapping of roles and reduce the operation cost. This restructuring process will
give the management of ideas to reduce employee at all levels.
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Question 2
Employee commitments are important as they will support in terms of the execution and implementation plan.
By going through a road show through all levels of the bank, once the management had made it clear the
benefits that the revamped work processes will have on the productivity of the employee as well as enhancing
the quality of the employee work by reducing unnecessary or redundant work.
When employees are empowered to make decisions, internal changes and innovation can happen faster and
employees will feel involved in the innovation process and actively contribute to improving products, services,
and procedures. Rather than wait for top-level management to come up with new ideas, employees will feel
involved in the innovation process and actively contribute to improving products, services, and procedures.
As example, those who work directly on projects and oversee project management can liase with other
department on the decisions that will impact their future work and to exchange ideas that will improve their
work. They can create opportunities for feedback, brainstorming, and constructive criticism that often lead to
better systems and outcomes. The company will be more likely to improve productivity. A wide hearth of brain
power goes into the problems of the company as they arise, which will result in quicker problem solving and
more efficient solutions.
So in conclusion, by including all levels of employee in these review of the work processes, then the general
morale of the employees as well as the commitment of the employee towards the new work processes will go
up.
Question 3
The Managing Director is more like a facilitator of change as he played a part in influencing the process of
change. He agreed with the proposal to hire an outside consultant to introduce philosophy and tools of the
change program to senior and middle managers in a series of workshops. Once familiar with the concepts and
principles, these managers were then expected to encourage their staff to form quality improvement teams to
solve specific work problems identified by either the general staff or managers. They will then rectify
inefficient work system through elimination or waste and rework. However, the Managing Director had a
relaxed management style and assumed that departments would become involved in quality improvement
projects on their own accord.
As the participation in quality improvement teams was voluntary, many managers reluctant to support this
change. They don’t let their employee to be involved in the quality improvement projects as they worried that
their employee could be over-worked and simply could not afford to allow their staff to take time off to become
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involved in this change initiative. They were sceptical about the initiative and felt that it was better suited to the
manufacturing sector rather than financial service operations
Question 4
a) In my opinion, the most important thing the management must do before embarking on such a quality
improvement plans, the management must organise a road show as an open lines of communication
throughout the organization so that all key employees from all levels are aware on what the management is
planning to do. Management could share the expectation from this quality improvement plans so that the
employees can have a clear vision for company direction.
b) The management should identify the change needed and use S.M.A.R.T (Specific, Measurable, Attainable,
Realistic, Timely) goal setting to build the business case. The management could share with the
stakeholders on the information on business case and goals and the benefits that such a quality
enhancement process review towards the organisation in general as well as the employees in general so that
they could be convinced on this initiatives.
c) Better still if the top management can create a plan for the project and assign specified employee to work
on these process improvement projects. At the same reduce some of their workload while they are working
on the quality improvement program so that they are able to devote their full time and attention on this
matter. Some other resources apart from the labour and tools for implementation and evaluation should also
be properly coordinated for this initiative. They could hire a consultant that will facilitate the quality
improvement program plan so that it is align with the company strategy, business’s mission and long-term
vision.
d) The management could offer some rewards to the team or specific individuals who are able to propose a
plan that will improve the company productivity in the form of bonus, promotion or increment, as a
celebration of the successful implementation of change. This could encourage the employee to volunteer
and work hard towards this project.
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