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The Central Bank of Oman (CBO) although established in the year December 1974 commenced its operations in the year April 1, 1975 (cbo.gov.om 2021). The CBO was established to act as the major currency authority of Oman in replacement of the Oman Currency Board. Presently, it is controlled by Taimur bin Asaad bin Tariq al-Saeed. The CBO had been responsible for the maintenance of stability of national currency, Omani Rial and in ensuring financial and monetary stability within an open and deregulated financial system. Presently, it takes care of the licensed banks, financial and the leasing institutions and the money exchange firms (cbo.gov.om 2021). With time capital base of the bank had been strengthened. The CBO also participated and administered in financing the insurance system of the Bank deposit that provided commercial bank with higher security of the deposits while cushioning impacts of the unforeseen circumstances. CBO also provided primary warning system for the commercial banks for predicting any kind of financial crisis and undertake defensive action whenever necessary.
As a part of the change management, Central Bank of Oman (CBO) transformed into a new identity for better reflection of its role within the economic sector of Oman. It also launches a verified social media account. The transformed CBO brand looked forward to reflecting its aspirations, role, and the core mandate that helped in promoting the wellbeing of the financial and banking sector of the country. This also contributed to the overall economic development and enhancement of prosperity of Sultanate (timesofoman.com 2021).
Over the past few decades, there has been a dramatic change in the business world and presently people seem to within a connected society where change is not only constant and fast paced but also unpredictable. Fast advancement in technology led to the creation of an environment that made smartphones, internet and the social media ubiquitous. Moreover, the global financial crisis of 2008 has led to sense of danger, turbulence as well as unpredictability across certain areas. In fact, there has been a state of instability that replaced sense of stability, certainty and the familiarity which people has been used to. This kind of environment is often described as VUCA that stands for being Volatile, Uncertain, Complex and Ambiguous (Mack et al. 2015).
According to Shtal et al. (2018), in most of the cases, an organization is unable to control the external factors and hence they seem to pose as either threats or opportunities for the organization. These factors comprise of dynamic, developed as well as uncontrollable measures that impacts the organization both in the long run and the short run. PESTEL represents an analytical framework that enables in understanding these external factors representing both threats and opportunities. This framework provides an insight into the political, economic, social, technological, environmental and legal. This is described in detail in Appendix 2.
Organizational structure represents a formal system of the authority relation and the work role that determines the way the managers and associates work together with each other. It basically represents a relationship pattern amongst the different positions of the organization (Ahmady, Mehrpour and Nikooravesh 2016). The structure also makes it easier in defining the management process.
The organizational chart although presents a formal structure but it lacks insight into the actual dynamics of the organization. Being a part of the VUCA world, it is vital to pay closer attention to the informal structures. Organizations need to understand that the capability to grow as well as organize acts as the key towards agility. This indicates that organizational structure needs to be approached as ongoing process. BerkmanCenter (2008) put forward several enablers that plays a role in contributing to the skill of organizing. This includes shared values, shared interest, shared structure, shared strategy and shared action.
This led to the emergence of various classical theories of the organization that provides a better understanding of its structure. Henry Fayol has been one such founder of the classical management theory who put forward certain universal principles of the classical management that directed managers to focus on forecasting and planning, commanding, organizing, controlling and coordinating with regard to the various activities of the organization.
Another classical theorist, Frederick Taylor, put forward a philosophy focused on a belief that making the people work harder was not as effective as optimizing the way in which the work needed to be done. His scientific management theory focused on the improvement of the efficiency of each of the individuals within organization (Grachev and Rakitsky 2013). The key emphasis of the theory lay in raising the production through use of the intensive technology and human beings acts as adjuncts to the machine in performing the routine task. This theory is based on four principles which includes consideration of science and not the rule of the thumb, harmony and not discord, mental revolution, cooperation and not individualism and development of every individual to the greatest level of efficiency.
Mary Parker Follet who was also known as the mother of the modern management held the belief that management lay in the art of getting the things done through the people. Direct connection between the managers and the employees helps the organization in avoiding the conflict as well as misunderstandings. Acknowledged for managing tactics and mediation of tendencies, Follet tried to create a management theory which is favored till date (Khorasani and Almasifard 2017). The key principles of the theory focused on integration, power with team and group power
It is the Classical theorist, Max Weber, who provided an insight into how standard organizational structure is represented by bureaucracy (Linstead, Fulop and Lilley 2009). Although the model has been criticized but its essence existed across majority of organizations across the world. Weber’s bureaucracy theory has been one of the complex descriptions of the organizational administration emerging in literature. He recognized bureaucracy as the technically effective device for relating the organization’s means to the ends. To explain this, he put across how the modern systems of accounting related to the resources of an enterprise for achieving the goals of the organization in a calculable and precise manner. Within the emerging system of the organization, Weber observed power instrument of first order. He observed bureaucracy as an embodiment of powerful mixture of the knowledgeable officials who would rule by the regulations and law on a calculable basis. According to Weber, this phenomenon of power would challenge the basis of the democracy. Weber’s bureaucracy theory focused on the principles of power and authority, belief systems and authority, specialization and centralization, rules and procedure and the technical rationality and expertise. In fact, it is also a structure that offers highly routine task achieved by means of specialization with very formalized regulations and rules. The task remains grouped into the functional department with centralized authority. This kind of structure allows decision making which follows chain of command.
As far as the organizational structure of Central Bank of Oman is concerned, it can be said that it has also adopted an organizational structure to ensure that its various functions are performed efficiently as well as effectively through chain of command (cbo.gov.om 2021). The chain of command represents an organizational structure where employees are linked together into a span of control by the supervisors at a higher level that provides an organization with a pyramidal configuration or structure. In this particular structure, directives or commands flows down via the command chain from the senior management through the middle management and then to the first line managers and the subordinates, with relationship flowing upward via same channel.
In this regard, it is found that the functions of CBO were mostly carried by the different departments as portrayed in the organizational chart mentioned below in Figure 1 forming a pyramidal or hierarchical structure. The bank has three key roles or identifiable areas of accountability that is portrayed by organizational structure. Some departments of CBO perform functions of guidance and control, some contribute to the financial and the monetary stability including the treasury and the investment functions while there exist other departments for providing support services.
Figure 1: Organizational Structure of Bank of Oman
Source: (google.com 2021)
Organizational culture on the other hand represents a complicated phenomenon that is not only related to the shared meaning and value within an organization but also holds relation to the common means of either dealing with or ignoring the problem which is commonly experienced (Linstead, Fulop and Lilley 2009).
The organizational culture of Central Bank of Oman can be explained with the help of Johnson and Scholes’ cultural web model (Mcdonald and Foster 2013). The cultural web represents a vital tool altering and analyzing the assumptions revolving around the culture of the firm. The model can also be used for highlighting the particular beliefs and practices and in aligning them with the preferred culture and the strategy of the company. The diagrammatic representation of the model is shown Appendix 3. However, the six contributing elements of the Central Bank of Oman are mentioned as follows:
This particular section of the study focuses on change management model along with their practical implication on the workplace. The models to be discussed here include Lewin’s three-step model. According to Kurt Lewin, change for any individual or an organization is a complicated journey which may not be very simple and mostly involves several stages of transitions or misunderstandings before attaining the stage of equilibrium or stability. The three stages indicated by Kurt Lewin are mentioned as follows (Cummings, Bridgman and Brown 2016):
Stage of Unfreezing: This represented the initial stage of transition and is considered one of the crucial stages in the whole process of the change management (Burnes and Bargal 2017). In case of CBO, this stage acted as improving readiness as well as willingness of the people towards bringing about a change through fostering a realization by making a switch from prevailing comfort zone to the transformed situation. This also involved in making the people aware about the need for change along with improving the motivation for acceptance of newer ways of working for yielding better results.
Stage of Change: This is the stage that is regarded as the transition stage or a stage of the actual implementation of the change (Tang 2019). This is indicated by the new ways of performing things adopted by CBO which includes a change of logo and opening of a social media account. It is however believed that this particular stage of transition is not easy to achieve as a result of the uncertainties or the fear of the consequences in adopting the change process. However, CBO did not face any major resistance as it had employee support.
Stage of Refreezing: This represented the stage when people tend to make a move from the transition stage to an increasingly stable state that can be considered as state of the equilibrium (McAleese, Creed and Zutshi 2013). This represents the final stage where people internalize or accept the change initiated by CBO and look forward to establish newer relationship.
To practically explain the changes undertaken within the workplace of Central Bank of Oman in light of Lewin’s model, it can be said that, CBO should initiate effective communication for driving better involvement and support from the people in initiating the change process. It must undertake careful planning, efficient communication and also encourage involvement of individuals in endorsing the transformation. In addition to this, CBO should not only reinforce but also strengthen the new changes as means of working, through rewards, recognition, positive reinforcements, structures or supporting policies that would contribute to the changed ways of working.
A number of employees from the HR department of CBO has been highly resistant to change. This might be due to various factors. As mentioned by Nishii, Lepak and Schneider (2008) employees responds differently to the managerial behaviors based on their interpretation of the manager’s intent. Dent and Goldberg (1999) points out that the people usually resist to the change due to loss of job, loss of pay, poor level of communication as well as engagement, loss of status and loss of comfort. Job loss serves as the key reason for employees to resist the change within the workplace. Another key reason for the employees to oppose change depends to how the change process gets communicated. If the procedure followed in what requires to be to changed, the way it needs to be changed and the way the success would look like, is not properly communicated then there will be resistance to the change. Sometimes, it is the mutual mistrust between the management and the employees that forces the company to go into downward spiral. Employees also do not respond well to change if the company is consistently going through a time where the future seems to be unknown. Resistance may also be due to the poor timing as to when and how the change gets delivered.
A research also found that workers experiencing present change were more likely to report work stress in comparison to the worker who experienced no current or anticipated level of change. Comparison based on percentage showed 55 percent versus 22 percent (cbia.com 2017). Thus, as put forward by Battistelli, Montani and Odoardi (2013), resistance is primarily created due to certain blind spots and attitudes which the staffs possess due to preoccupation with the new ideas
On the other hand, Eisenack et al. (2014), points out that although change is inevitable but there exist certain barriers in accomplishing it. One of common barriers to change include absence of employee involvement which indicates the fear of unknown and absence of desire in embracing new culture acts as total barrier to change. It is also the absence of an effective strategy for communication that acts as barrier to the change. This is an instance when the concerned organization does not have an effective strategy of communication. There also exists unidentified aspects of present state that makes the change difficult for the organizations since it lacks idea regarding the present state. In addition to this, complicated process of an organization makes the planning process and the implementation of change more complex. Barriers tends to create gap in the current and the recommended practice which eventually might have negative impact on the day-to-day activities of the organization.
Tjosvold et al. 2014 has however pointed out ways of dealing with and managing conflict with regard to a change process. This includes emphasizing on the organization wide effectiveness and goals. This will help in preventing conflict with respect to goals. Emphasizing on the bigger goals will allow employee in seeing the bigger picture and working together in achieving the corporate goals. It also indicates in enabling the intergroup communication. It has been found that Misconception of abilities, motivations of the others often result in conflict. Therefore, effort of initiating a dialogue amongst group along with share information about the change often results in elimination of conflict. Lastly, it is also necessary to avoid the of win-lose situations. Avoidance of such situations helps in reducing potential for conflict.
Lent et al. (2016) also pointed out the importance of managing self with respect to a change process. This can be done by following three stages. Stage 1 is marked by ending, losing and let going. This represents the initial stage which occurs when the people remain confronted by the change and is usually typified by the difficult emotions and resistance as well as tough emotions whenever people remain confronted with let going of what seems comfortable and familiar to them. Listening and open communication happens to be the key at this particular stage. Stage 2 remains marked by the neutral zone. This stage indicates disorientation and characterized uncertainty. Newer means of doing things will be able to create an enhanced pressure as people requires to develop newer habits and newer means of working. Hence, there is a need for strong sense of purpose and direction that helps one in overcoming negative emotions. Stage 3 marks the new beginning. This is considered as the final stage and remains characterized by acknowledging the progress and embracement of change. This is a stage when people tend to become increasingly accepting and the transition include development of skills for meeting new demands. Maintenance of positive attitude, relationships along with sustenance of enthusiasm acts as the key during final transition stage.
Here, I can say that as I am looking back at a change incident which according to Shon’s can be categorized as Reflection -on -Action (ROA) (Linstead, Fulop and Lilley 2009). This kind of reflection generally takes place post the task. For most of the scholars, it has been found that reflective activity as well as sense making takes place when there exists a breakdown within the practice. According to Weick (1995) this kind of reflection takes place when they are unable to move along their normal ways of accomplishing things.
My own experience can be reviewed, evaluated and systematically analyzed across the four stages put forward by Kolb, also referred as the ‘experiential learning’ (Linstead, Fulop and Lilley 2009). The first stage refers to the concrete experience, where one is able to physically and consciously experience a particular situation that instigates the realization to reflect systematically for learning something new or improving the existing practice or skills. This stage allows in identifying specific situation and in describing what one is able to see, feel and think. Hence, understanding of this stage helped me in identifying the change process that CBO had been undergoing and in reflecting upon whether the change will be well accepted and successful.
The second stage of the Kolb’s model represents reflective observation that helps one in reflecting deeply into the happenings of the situation. This stage has helped to reflect upon the success of CBO in implementing the change of transforming its brand identity. I believe that such a change was undertaken for promoting well-being of the financial and the banking sector within the country along with enhancing prosperity and overall economic development. The brand renewal project was executed and carried out with support from the CBO employees.
The third stage of Kolb’s learning model is marked by abstract conceptualization. This step enables one to have greater understanding on how things could be done better or in a different manner. The stage also allows one to adopt ways of improvement. I was able to develop a greater insight into the fact that organizations in the modern era are subjected to change in order to grow. Therefore, proper strategies needed to be place for training employees in accepting the change.
The last stage of the Kolb’s learning model represents the active experimentation. This stage allows one in practicing the learnt theoretical knowledge. What I can derive from this analysis is that if a firm is unable to integrate the structure with the culture it will not be possible for it to encourage the employees in undertaking initiates and ensure successful implementation of change that remains critical to an effective performance. This requires adoption of approaches to human resource management, policies as well as practice which will ensure an effective change process in future.
It is to be noted that change management within an organization involve every individual. A firm also looks forward to the human resource for providing the necessary assistance and support. Therefore, some of the recommendations for the human resource management approach are as follows:
Implementation of a Model Which Every Individual Can Use: The organization might adopt a model which employees are able to apply into their personal as well as professional lives. It is therefore recommended for the HR to train the employees on the usage of the model adopted for change management model during either onboarding or orientation such that everyone is able to speak common language.
Implement Policies for Embracing Technology: There are times when the initiative for organizational change management undertake involves technology such as implementation of new system. HR should thus, create a culture of allowing the employees to not only experiment but more willing towards trying newer ones.
Implement Policies to Reward and Recognize the Efforts for Managing Change: Employees must be encouraged in stretching their goals, supporting the efforts followed by rewarding their accomplishments. HR might bring in value to the strategy through coaching and training the managers on the techniques of effective feedback along with designing recognition and reward programs encouraging the behaviors.
On a concluding note, it can be said that, the Central Bank of Oman undergoes a significant change by bringing about a transformation into its brand identity. The report provides a critical analysis showing how the bank competes within the changing external environment. The report also shows that considerations of aspects related to management like the structure, culture along with their interrelationship impact the business performance of the firm to attain higher level of performance and enhanced profits. The introduction of the change models also portrays how the effectiveness of change depends on fulfilment of certain criteria of the model. The report also identifies the impact of change on the staffs along with identifying and effectively resistance to change and its barriers and management of conflict and self. This is followed by an academic reflection.
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