Introduction and Problem Definition Garanti Bank (GB) which is one of the big private banks in Turkey had passed through a remarkable change operation. During this transformation, the mail goal was to redefine both culture and the organizational structure of the bank. Contrary to the culture present in Turkey at that time, Mr. Ongor and the management board accomplished creating a new culture in GB. Ongor had achieved changing the organizational structure and culture, but the only thing to do is to keep it effectively so that after his retirement GB would not go backwards to the old way of doing things.
Critical question is whether the system will maintain with remarkable change found and implemented by Akin Ongor, when he is going to leave from his position. Corporate culture, which cannot be contingent upon only one specific person, should be suggested ways of sustaining newly created culture before retirement of Mr. Ongor. Besides, it is also in demand that GB operates as a service hub to diffuse the practices, acquired during its transition, to the rest of group companies. Analysis In the beginning of GB history, the whole system depended on centralized, integrated, and more based on control structure.
To illustrate, branch members were waited for commands of the CEO and executive members, staff was blamed for their mistakes, they could not behave as an entrepreneur, and hence they were reluctant to get in complicated situations. There was high uncertainty avoidance in the organization and thus no risk taking. The first step to the change was taken with Mr. Tekin. Culture and the organizational structure of the bank, had been defined as “a traditional deposit-taking institution, hierarchical, introverted and domestically oriented”, which was started to change with new CEO Ibrahim Betil’s approach in 1986.
He tried to establish more performance-oriented, for instance pop-up visits in each department during the week. For more improvement, GB had to set a new business strategy and to be able to carry out it smoothly. According to Lewin’s force field model, effective change happens by unfreezing the current situation, moving to a desired condition and the refreezing the system so that it remains in this desired state. Unfreezing involves producing imbalance between the driving and restraining forces. This could occur by increasing the driving forces or reducing the restraining forces, r having a combination of both. In spite of the fact that there were external forces, they were not enough alone for an effective transformation like the GB case. In many organizations external driving forces are hardly felt by anyone below the top-executive level. Thus, an organization needs propulsive forces within the organization so as to foresee these external forces. These forces, which are internally originating, are difficult to apply; because they lack external legitimates, hence effective transformation occurred by leadership is necessary to justify and assist internal driving forces.
At this point role of Akin Ongor was critical in the change process as a leader in transformation of the system. Leaders during the transformation of the system could be behaved as change agents who energize,motivate and direct staff to a new set behaviors and values. Akin Ongor proved to be an effective leader during this process by developing a vision for the organization, inspiring employees to that vision, and fulfilling the change. According to John P.
Kotter, for a successive organizational transformation leaders should go after eight distinct steps in an order. Akin Ongor started the “change” process by constructing communication system along the staff and the managers. He eliminated the obstacles that buffer employees from the external environment by informing employees about competitors, changing customer trends and other driving forces. After creating urgency for change as he said “The bank needs change urgently”, he formed a strategic vision of a realistic and attractive future that keeps employees together.
He composed a vision which differentiate GB from the current situation and set goals both achievable and attractive which were supported rewards in the short term. He communicated the meaning and raised the importance of the visionary goal to employees. Creating a shared vocabulary, jargon in the business helped communicating that vision. Mr. Ongor brought his vision to life through symbols. Without leading of him, GB would decline and eventually become seriously misaligned with its environment.
He also gave importance to learning organizations like training programs on change management which were lectured by foreign professionals. Finally, by involving human resources department and employees in the process of shaping the organization’s vision, Akin Ongor created a commitment toward the vision. An organization’s culture is firmly set in a place of the employees’ minds. Higher standards in new hiring criteria like at least one foreign language prerequisite and the change in process helped to reinforce the newly set organizational culture.
The resistance of longer tenured managers by not getting on board, not taking place actively in projects, and always looking for signals from above, was overcome with the new employees. The presence of new employees, forced the existing managers to challenge themselves and to start thinking about self-improvement. Some branches were closed, this brought into that people were worried about their jobs, and they illustrated this situation as an “earthquake”. This and the presence of young entrepreneur staff make the managers worried about their jobs.
With some firings, the education level went up and average age decreased from 50 to 30. 5 years. By accelerating the turnover of senior executives and older employees who held the cultural values in place, Mr. Ongor minimized the restraining forces that are resistant to change. Recommendations and Conclusion In order to support and sustain the established culture at GB, cultural network might be directed by senior executives. They could mix into the cultural network, sharing their own stories and creating new ceremonies to display shared meaning.
An effective refreezing of changed structure could be achieved by aligning the reward system around desired performance and results. With its new business strategy GB now is a customer-oriented company and its key service attribute is quality. Employee’s attitudes and greetings towards customers could be evaluated by direct feedback from customers. Employees that got positive feedbacks than could be further evaluated on a performance basis. Overall, the top employees could be rewarded with a personal evaluation form a high level manager, with a small amount of money.
In order to diffuse the remarkable changes occurred in GB through the entire corporate group, Dogus, big congresses which employees as well as stakeholders of different companies gather together could be organized. Numerous questions and solutions of them like what was done in GB, benefits of such change and experiences gained could be shared with other corporate companies in these meetings. References Kotter, John P. (2007) Tests of a Leader. Harvard Business Review. p. 96-103