Analysis of Organizational Change Management at Muscat Finance Company

This report provides a comprehensive analysis of the organizational change management strategy implemented by the Muscat Finance Company, a financial institution in Oman. The report focuses on the company's attrition policy, a cost-cutting measure designed to enhance its competitive advantage. It begins with an executive summary and an introduction to organizational change, emphasizing the role of HR in managing such processes. The report then provides background information on the Muscat Finance Company, including its services and organizational structure, followed by a competitor analysis using Porter's Five Forces framework. The core of the report examines the change management process, including the rationale behind the attrition strategy and its impact on the organization's structure and culture, using the McKinsey 7S framework. The analysis includes reflections on the success of the change and concludes with recommendations for better employee adaptation and improved productivity. The report also covers the company's aim to become a leader in financial solutions within Muscat, and the challenges it faces from competitors. Overall, the report provides insights into the complexities of organizational change and its impact on business performance.

Running head: ORGANIZATIONAL CHANGE MANAGEMENT
Organizational Change Management
Name of the Student
Name of the University
Author Note

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Executive Summary
The process of change management is one that is known to be quite harsh and complex
and the manner by which it is implemented has an influence on how effective it is. This
assignment discusses the change management policy of attrition implemented by Muscat Finance
Company for creating competitive advantage. The report analyzes the competitive strength and
background of the company before proceeding to analyze why the change management is being
introduced, how it is going to shape and the precautions and measures that have to be taken by
the HR management of the organization for the adequate implementation of the same.

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Table of Contents
1. Introduction..............................................................................................................................2
2. About the Muscat Finance Company.......................................................................................3
3. Competitor Analysis – Muscat Finance Company...................................................................5
4. Organizational Structure and Culture.......................................................................................7
Change Management at Muscat Finance Company......................................................................11
5. Reflection...............................................................................................................................15
6. Recommendations..................................................................................................................16
References......................................................................................................................................20

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1. Introduction
Organizational change refers to a change that is brought about in the processes, the
strategies, the technologies and the operations of a given organization. Organizational change is
implemented more often than not with the help and the assistance of the HR division of the
organization, a process that is also referred to as change management. It is the HR executives and
managers who take on the arduous job of explaining to employees the process of change, the
reason why the change is taking place and the benefits and the advantages that are likely
associated with the change process. Organizational change management has far reaching
consequences, and more often than not, a well formulated policy or plan is drafted with the
purpose of implementing the proposed change by the higher authorities in the organization. One
of the greatest difficulties that are associated with organizational change is to get employees to
accept the change that is taking place. It is quite normal for employees to resist the change
process, and to fight the given situation by either resigning from the organization or by
demonstrating a decline in the area of productivity. It is therefore a challenge for the HR
management of an organization to get the workforce in the organization to embrace the change,
so that the far reaching consequences of the change are well received and the purpose for which
the change is introduced in the first place, is achieved. This assignment engages in an analysis of
the change management procedure that is implemented by the HR department at an organization
in the Sultanate of Oman known as the Muscat Finance Company. The change that is introduced
and which will be analyzed in detail in this assignment is attrition or cost cutting, with several
employees of the company being laid off and new smaller workforce being created for the
purpose of establishing competitive advantage. In the process of analyzing the change, the

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external environment in which the company operates is studied using the framework of Porter’s
5 Forces, the actual change management introduced is studied using the Mckinsey’s 7S
framework and the impact that the change has on the staff of the organization is something that is
studied in a considerable amount of detail as well. The report concludes with a reflection section
on how and why the change management was successful and also provides a list of
recommendations that can be taken into consideration by the company in order to get the
employees to adapt better to the change initiative so as to be able to perform better and with a
greater degree of productivity at the workplace.
2. About the Muscat Finance Company
The Muscat Finance Company is a leading organization in the city of Muscat in Oman
that has acquired name and fame in the way by which it provides financial solutions to top notch
clients living in the city. The Muscat Finance Company has been in existence for quite some
time now and is serviced by an elaborate organizational structure that is made up of a higher
management, a lower management and an extensive workforce. Apart from operating from one
main center, the company has a number of branch locations as well and it functions with the
efficiency and the proficiency that one would normally expect from a finance company. Muscat
Finance Company is one that believes in the rendition of quality financial solutions for its
customers and as such is not seen to compromise on the manner by which it takes up and delivers
assignments for its clients. Assignments are delivered in a timely and accurate manner, and the
organization leaves no stone unturned to make sure of the fact that its clients are content and
satisfied with the work that is performed by the organization. A key strength of the organization
lies in the fact that it provides timely solution for customers and there is also a variety of

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financial services that customers can make a choice from when signing up for the services that
are offered by the organization. In spite of the efficiency and the competitiveness with which the
organization runs its operations, the intense competition that it is faced with in the financial
industry in Oman is compelling the organization for ways and means by which it can cut down
upon its resources and maximize the advantages that are being offered by whatever investment
that it is making. One area where the company has decided to downsize in the recent past is on
the size of the workforce. As mentioned above, the company is serviced by an employee base
that is quite exhaustive and which is made up of a vast number of managers, line managers and
employees or regular workers who run the day to day operations of the company. The company
believes that by downsizing its workforce, it will be able to retain talent better, while also
reducing its investment in the area of human resource. With fewer but gifted employees, the
organization will be able to race ahead and compete successfully with its rivals in the industry
which is the unfortunate incident of attrition needs to take place.
The Muscat Finance Company is by and large quite a thriving company and it has made a
name for itself for the provision of highly specialized financial services such as debt recovery,
the liquidation of assets, leasing of capital, working finance and various other types of financial
activities. The company aims on becoming one of the leading names in Muscat in the area of
financial solutions in the upcoming five to ten years and is willing to take recourse to whatever
step or method is needed for the purpose of maximizing productivity. The fact that the profit or
financial turnaround is not as high as it should be is something that has compelled the company
to opt for attrition or workforce in order to make up for some of the financial losses that it is
currently faced with. The competitor analysis of the Muscat Finance Company will be carried
out in more details below.

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3. Competitor Analysis – Muscat Finance Company
The competitor analysis of the Muscat Finance Company is something that will be carried
out using the framework of Porter’s 5 Five Forces.
Competitive Rivalry – Muscat Finance Company in Oman is an organization that provides top
quality financial solutions such as debt recovery assistance, the leasing of property and vehicles
and the complex task of asset management. Yet these are services that are also made available by
other financial organizations that operate in Muscat and which also have the capability, the skill
and the manpower that is needed to deliver quality timely solutions in a timely manner. Muscat
Finance Company is definitely not the only organization in Oman that offers the type of services
that it does, and there are many other rival organizations that are seen to offer the same. Hence
competitive rivalry for an organization like the Muscat Finance Company is quite high.
Bargaining Power of Suppliers – The Muscat Finance Company in Oman is one that is
serviced by an elaborate network of suppliers and distributors. This is because of the fact that
there are many organizations in Muscat in Oman which offer or specialize in the same or related
services. The availability of suppliers and distributors is something that can always be counted
upon, and the bargaining power of suppliers may be considered to be low for Muscat Finance
Company.
Bargaining Power of Customers – The bargaining power of customers on the other hand is
high for an organization like the Muscat Finance Company. This is because customers can
choose from a diverse range of options or companies when it comes to the services that are
offered by the Muscat Finance Company. There are numerous other companies in the city that
offer related services and that too at cost effective rates. Hence customers do not have to restrict

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themselves to only using what is offered by the Muscat Finance Company in the event that they
require immediate, urgent and long term financial solutions.
Threat of New Entry – The threat of new entry is quite significant for a company such as the
Muscat Finance Company and this is because of the large scale demand for financial services,
not only in Muscat but in the country of Oman as a whole. There is every possibility of a new
enterprise making its presence felt in the city, which offers financial services which are similar to
those offered by the Muscat Finance Company and which may also be provided at rates that are
more affordable than what is offered by the Muscat Finance Company. The threat of new entry is
high for the Muscat Finance Company.
Threat of Substitution – Every effort needs to be made on the part of the Muscat Finance
Company to make sure of the fact that it the services that it offers in the financial market of
Muscat are uniquely positioned. In the event that it fails to do so, there is every possibility of
such services being substituted and improvised upon by other rival organizations operating in the
city, leading the company to fall out in the area of competition. The threat of substitution is high
for Muscat Finance Company.
The above competitor analysis of the Muscat Finance Company using the framework of
Porter’s 5 Forces goes to show that although the Muscat Finance Company is a thriving business
organization in the city of Muscat in Oman, there is plenty of competition that the company is
faced with and the company needs to keep its services quite uniquely positioned so as to be able
to offer its customers something that is of a novel nature. Hence the policy of attrition which is
going to be discussed in detail in the following sections is a step that the company is taking
recourse to in order to remove its liabilities once and for all and create the type of competitive

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advantage that will work in favor of the company in the long run. The competition for the
Muscat Finance Organization in Oman is real, it’s strong and it’s powerful and there are quite a
few steps that need to be taken by the organization in order to ensure that it stays ahead in the
game. One of these is unfortunately to downsize the workforce and introduce a change in this
respect in the organization’s structure, a task that will be handled by the HR management of the
organization.
4. Organizational Structure and Culture
When it comes to understanding the culture and the structure of the organization that
prevails at the Muscat Finance Company, it is important to remember, first and foremost that this
is an organization which believes in a flexible work culture. One of the reasons why the Muscat
Finance Company has until date been able to recruit candidates in large numbers is because of
the fact that it has managed to create a positive work culture here. The work culture in the
organization is employee friendly for the most part, with each and every member of the
workforce being made to feel welcome when they join and even afterwards. A huge benefit for
any employee who has been working at the Muscat Finance Company until now is that they are
respected for their inner value and their ability to contribute effectively to the goals and
objectives of the organization. This is not an organization that believes in discriminating against
people on the basis of skin color or on the basis of religion as a consequence of which people
find it quite desirable to work over here. The employee base at the Muscat Finance Organization
is one that is made up of people of diverse ethnic and economic backgrounds. Immigrant
populations form a significant part of the workforce in this organization and the level of religious
tolerance that is practiced by the organization towards its employees is noteworthy. There is no

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discrimination that is undertaken in the organization on grounds of religion and employees are
made to feel comfortable in their skin color. They are made to feel valued and part of the
organization and are always encouraged by the leadership of the organization to do their best.
Muscat Finance Company is one that believes in motivating its employees to the fullest and this
is very important given that motivation is one of the key factors that can influence an employee
to stay on in an organization and work for the organization over the long term. The culture of the
organization is aimed at equity and diversity. People of all cultures and ethnic backgrounds are
recruited into the organization and once they are selected and enrolled they are motivated to do
their very best. The leaders and the managers at the Muscat Finance Organization or Company
are quite inspirational in their speech and know exactly what it is that is to be said to the
employees of the organization, in order to lift their spirits and get them to perform to potential.
Employees are motivated right from the time that they join the organization till the time they
decide to leave the organization.
Employee welfare is a matter that is looked into by the Muscat Finance Organization and
every effort is made on the part of the human resource management of this organization to make
employees feel included and desired by the firm. This feeling of being wanted or the feeling of
being secure at the organization in general is not something that is cultivated only through
motivational speeches and good leadership abilities but also through the provision of a decent
remuneration along with financial incentives, with the latter being offered for any additional
work that is taken up by employees for the benefit of the organization. Employee welfare is
assured by the HR department of the organization through the timely disbursement of salaries
and the provision of financial incentives every single month. Employees at the organization do
not have to wait indefinitely in order for their salaries to arrive and they can also be assured of

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getting paid extra or being paid a bonus in the event that they try to do a lot more for the
organization than what has been dictated in the terms and conditions of the contract that they
signed at the time of their recruitment. As a result employees get to feel very financially secure
when they work for the Muscat Finance Company. They never have to worry about monetary
matters as this is an aspect that is well taken care of on the part of the organization, and as a
result they have all the motive in the world that is needed in order to be able to perform suitably
well for the organization. The Muscat Finance Company is indeed one of the largest service
providers in Oman and it takes every step in the book to ensure that its employees are well
looked after.
The culture and the organization that prevails at the Muscat Finance Company is one that
is designed to ensure employee wellbeing in every sense of the term. Not only is the work culture
of the organization quite an inclusive one, but the financial running of the organization is proper
too, with employees never having to worry about remuneration and other issues when they work
for this company. Employees who are not able to perform to potential or are unable to grasp the
key aspects of what it is that is demanded of their job profiles are sent to what may be termed as
a performance improvement program. This program is conducted for employees who are not
performing sufficiently well and who could do with some additional care and guidance. There is
no aggressive policy of termination that is followed by the Muscat Finance Company and
employees are released from the payroll of the organization only after they have been provided
with repeated attempts and chances to improve their performance.
In addition to the timely disbursement of salaries and the provision of financial incentives
the employees of the organization are also appraised on a half yearly and yearly basis based on
how well it is that they have performed throughout the entire length of the year. The appraisal

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amount is usually quite decent to say the least. The leave policy of the organization is one that is
quite flexible as well and employees can take a leave up to two to three times in a month while
maternity leave is also something that is sanctioned for the female employees who are working at
the organization. They are paid for the period of time that they remain on maternity leave and do
not have to worry about losing out on their salary for this length of time. It is thus clear that the
Muscat Finance Organization is one that provides its employees with several benefits that in turn
induce them to stay on and work for the organization over the long term rather than thinking only
short term with this firm. It is an organization that realizes that it can run best only with the aid
and the assistance of its employees which is why till date the organization has taken all the steps
that are needed to ensure the comfort and the wellbeing of its employees.
In the recent past however, as made evident through the competitor analysis that was
carried out in the previous section, the number of rivals and competitors of the company have
increased. This is especially the case because Muscat Finance Company does not provide
financial solutions that are unique in their nature and scope and there are other related
organizations in Muscat and other parts of Oman that offer similar services at better prices. The
company is thus faced with the urgent need of establishing competitive advantage and it has
decided to do so by following a policy of attrition, whereby the workforce of the organization
will be considerably reduced and the many of the benefits that have been outlined above will be
made available only to a limited number of employees working for the organization. This policy
of attrition shall be introduced as part of a change management process more of which will be
discussed in the next section.