1. can “create the results they truly desire,”

1.       Describe the characteristics of the learning organization

·         Describe the learning organization

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Learning is the key to success—some would even say survival—in today’s organizations. Knowledge should be continuously enriched through both internal and external learning. For this to happen, it is necessary to support and energize organization, people, knowledge, and technology for learning.

What learning organizations do is set us free. Employees no longer have to be passive players in the equation; they learn to express ideas and challenge themselves to contribute to an improved work environment by participating in a paradigm shift from the traditional authoritarian workplace philosophy to one where the hierarchy is broken down and human potential is heralded. Learning organizations foster an environment wherein people can “create the results they truly desire,” and where they can learn to learn together for the betterment of the whole (Rheem 1995,10).

Peter Senge is a leading writer in the area of learning organizations. His seminal works describe five disciplines that must be mastered when introducing learning into an organization:

1.       Systems Thinking – the ability to see the big picture, and to distinguish patterns instead of conceptualizing change as isolated events.

2.       Personal Mastery – begins “by becoming committed to lifelong learning,” and is the spiritual cornerstone of a learning organization. Personal Mastery involves being more realistic, focusing on becoming the best person possible, and striving for a sense of commitment and excitement in our careers to facilitate the realization of potential (Senge 1990,11).

3.       Mental Models – must be managed because they do prevent new powerful insights and organizational practices from becoming implemented. The process begins with self-reflection; unearthing deeply held belief structures and generalizations, and understanding how they dramatically influence the way we operate in our own lives. Until there is realization and a focus on openness, real change can never take place (Senge 1990,12).

4.       Building Shared Visions – visions cannot be dictated because they always begin with the personal visions of individual employees, who may not agree with the leader’s vision.

5.       Team Learning – is important because modern organizations operate on the basis of teamwork, which means that organizations cannot learn if team members do not come together and learn. It is a process of developing the ability to create desired results; to have a goal in mind and work together to attain it (Senge 1990,13).

·         In order to be a learning organization what changes must be made to the values of the organization (or adding new values)

Founded in 1874 as Azerbaijan Savings Bank, Kapital Bank is one of Azerbaijan’s largest banks serving more than three million customers. The aim of the bank is to become the financial partner of the first choice for its customers, guaranteeing prosperity in the future. Kapital Bank takes a secured approach in order to capture synergies between state owned corporate businesses and retail banking opportunities, while also serving privately owned corporate customers. Headquartered in Baku, Bank has a large footprint of 101 branches covering the whole country. Kapital Bank’s corporate governance complies with the best international standards. The bank recognizes the importance of good corporate governance, which is set up to ensure transparent and sustainable value creation by clearly defining responsibilities, management processes and organization. Kapital Bank has the highest rating among privately owned local banks. Bank’s over 100 years of history helps it to generate sustainable profit and allows it to capture growth opportunities. Bank employees work closely with customers to provide complete financial solutions and innovative products.

Our Current values

·         Transparency – Being honest and transparent to ourselves, to our customers, colleagues and partners.

·         Quality – Attaching great importance to professional quality in everything we do.

·         Profitability – Bringing value to our shareholders in every project that we start and implement.

·         Cooperation – Profitable synergy of cooperation with all strategic assets of Pasha Holding.

·         Entrepreneurship– Encouraging initiative and business promotion within acceptable risk limits.

New values

·         Agility – The ability to renew itself, adapt, change quickly, and succeed in a rapidly changing, ambiguous, turbulent environment. 

·         Innovation – Develop and offer to the market more-effective products, processes, services, technologies, or business models.

 

·         Is the structure of the organization suitable for changes or not, why? If not how you can change the structure to create a favorable environment for such a change

The current functional structure of the KapitalBank is not suitable for the change. In order to adopt the learning organization principles into organization we need to change it to cross between a traditional functional structures with a product structure.

In order to be more agile we need to switch on Matrix structure. Within the new structure employees from different departments would be assigned to the various agile groups. Such groups would be responsible for the full life cycle of the project/product. As a result, each person reports to a department manager as well as a team leader or product manager.

Informal aspects of change are:

·         Open attitudes on the part of managers and personnel

·         Degree of cooperation rather than destructive competition between divisions and departments

·         Culture supportive of innovation and change

Scale of a change (Dunphy and Stace, 1993) is Modular transformation – major realignment of one or more departments/divisions where radical change takes place.

2.       Create a culture ready for such a change

·         Is the culture of the chosen organization ready for such a change

The key principles of corporate governance at the Bank are reflected in Kapital Bank’s Corporate Governance code. The Bank supports relations with state agencies, shareholders, employees, partners and customers.

Corporate governance serves to further improve relations between the Bank’s managers and shareholders. This, in turn, ensures increased efficiency in all areas of the Bank’s operations. In addition to enhancing the important role of corporate governance, the Bank also pays special attention to the development of corporate culture and corporate ethics.

Adherence to ethical principles and trust in basic values shapes and preserves corporate culture at Kapital.

Change situations (Stacey 1996) is Contained – We are able to say what probably happened, why it is probably happened and what are the probable consequences

External forces

Today the Azerbaijan’s financial market is facing many challenges. Two subsequent devaluation rounds in 2016 had dramatically affected the main players on the Retail Banking market. Newly established the Financial Markets Supervision Chamber provided changes in regulation and control legislation. On the other side new technological trends in banking world and changing needs of the customer forces Banks adopt new type of approaches to the business models.

Internal forces

Need for higher profits, lack of innovation, need to change culture and Managerial aspirations are the most important internal drivers for Bank.

Coming to the question i suppose that the culture in not fully ready for changes mentioned above. I would like to mention the main driving forces against change:

·         Potential loss of power – Working in agile groups may blur the power of the decision making of certain managers. The Agile Group format encourages an open culture when the decisions are making in teams and are based on analysis and benchmarking but not on personal intuition.

·         Potential loss of reward – Changing the organizational model will cause the change in reward system. The reaction to this threat will be expressed in unwillingness to change anything.

·         Perceived lack of skill for new situation – the new approach would require the new type of skills such as working in teams, intelligent fast failure and common vision.

·         Lack of resources – establishing agile groups would require additional human resourses. The main principle of the Agile format is making thinks fast, so Bank would need some additional resourses in IT implementation team.

 

·         Using Lewin’s model how you can unfreeze this culture

The Force field analysis provides an overview of the balance between forces driving change in a business and the forces resisting change.

People are natuarraly resist change. Management’s obligation is to create the awareness of the change and show how necessary the changes are. Comunication is and important during the unfreesing stage as a result employees are become informed about the change and logic behind it and how they would benefit form it.

As soon as the team is informed we can start the implementation of the change. The stage when the changes become real. During this step people are learning new behaviours, proceses and ways of thinking. The more prepared the emoyees are to the change the easier they would be to complete the change process. For this reason the education, communication, support and timemanagent are become critical. 

·         Create tools for unfreezing the culture (e.g meetings, intranet, training, visible tools, etc)

In order to prepare the employees to the structure changes we need to do the following:

·         Organize the open sessions about the new work approach the benchmark and the results of such changes in other organizations.

·         Organize the courses of team work management for future team leaders.

·         Establish the reward system for agile team members.

·         Write the clear Job Description/ Competencies for every position

·         Organize some teambuilding event with the real business case simulators.

 

3.       Implementation of the change process

·         How you will implement the change?

Change is the process that must be carefully planned and executed. As mentioned above we will start from communication, information sessions and trainings. After everyone is informed about the vision and his role in the future organizational structure we will assign the teams and their main tasks. I also propose to invite some consulters /coaches who will be assigned to agile teams. They will mentor the team members and teach a new approaches to the work process (time management, process planning, reporting, controlling). Every team would have the team leader (project manager) that would be responsible for the organizing the work process within the team, he would rapport directly to the deputy chairman.

·         Who will be involved during the implementation of the change and how you will involve them

Mainly the Agile team would be consist of the employees form the following departments:

·         Product

·         Marketing

·         Financial

·         Sales

·         Customer lifecycle management

·         Risk

·         IT

·         Other functional department

As seen above the structural changes would involve almost the all business departments. In other words the changes would affect the most part of the Bank’s back office.

4.       Refreeze the initiated change:

·         How you can integrate the change into the organization in order to maintain it (e.g. different hrm practices)

Reinforcing stabilizing and solidifying the new state after the change. Affords must be made in order to guarantee the changes would not be lost. The changes should be reflected in organizational culture and maintained as acceptable way of doing.

Bank’s Management should encourage the teams and limit any afford to avoid the chosen format of making business (Burning Bridges).  The other methods could be as follow:

Evidence Stream. Get people to accept that a change is real by providing a steady stream of evidence to demonstrate that the change has happened and is successful.

Plan for change projects to reach milestones and deliver real results in a regular and predictable stream of communications that is delivered on a well-managed timetable. This is as opposed to the early ‘big bang’ followed by a long period of relative silence.

Keep posters and data charts up to date. Regularly show progress, demonstrating either solid progress against plan or robust action to address any slippage.

Reward alignment. Many people are driven by extrinsic rewards. The reward system is crucial driver of the employees’ behavior. Manager should find the balance between the reward-afford equation.

New challenge. One of the key things that makes people happy is challenge. Challenge is a future-based motivator that focuses people on new and different things, rather than basic motivations such as control and safety that may lead people to resist change.

 

 

 

References

adb.org

http://www.adb.org/sites/default/files/publication/27563/building-learning-organization.pdf

moyak.com

http://www.moyak.com/papers/learning-organization.html

kapitalbank.az

https://kapitalbank.az/about-bank?hl=en

changingminds.org

http://changingminds.org/disciplines/change_management/lewin_change/refreezing.htm

 

 

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