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Leading Innovation and Change Management Essay

An Evaluation of a Successful and Less Successful Innovation / Change of Which You Have Personal Experience, Related to Relevant Theory

Clegg, Kornberger, and Pitsis (2005) are sure that it is impossible to predict the outcomes of the change, therefore some projects appear to be successful, other projects turn to be less successful. Having personal experience in many situations where innovation and change have been applied, I would like to discuss two specific situations, one of which turned out to be successful and another one had less successful outcome.

It should be mentioned that implementing an innovation and change it is important to plan the consequences and try to predict the outcomes. A good manager always considers the future goals and makes all possible to meet those. The correct choice of the methods for implementing of the innovation and change is the half of success.

Having considered personal experience in implementing innovation and change, the merge of Credit Lyonnais with Credit Agricole should be considered. However, the implementation of Islamic banking in the newly appeared organization failed to be completed successfully.

Therefore, we have two processes, a successful merger of two banks and a less successful application of Islamic banking in the organization, which are going to be considered in this report for better understanding the models for innovation and change implementation.

Considering the situation devoted to the merger of two investment Banks in New York, Credit Agricole and Credit Lyonnais, it should be stated that the change is rather successful if considered from many aspects. The main reasons for successful outcomes of the affair are that the innovation and change followed particular scheme or theory and managed to meet the requirements put before the organization.

The merger of Credit Agricole and Credit Lyonnais followed the exploring corporate strategy model (Appendix 1) based on Kotter’s eight steps of successful innovations and change. The model can be easily referred to the case under consideration, however, the very idea of the situation should be described for understanding the means for success of the affair.

The merge of the Credit Agricole and Credit Lyonnais banks resulted in creation of the largest bank in France. One of the main changes which occurred in the company was related to the Human Resources department as being the newly emerged organization it enumerated about 60,000 employees. To organize the work in the department, the IT systems were reorganized and reconfigured.

The newly appeared company had to agree on the processes and start working together synchronising their performance. One of the main reasons for reconfiguring the HR information system was the desire to meet three specific objects, “controlling the applications, guiding conjoined projects and optimizing developments” (‘The mapping and merger of Credit Agricole SA’ n.d., p. 3).

Both of the organizations had to reassess their positions and roles in the newly appeared company. Strategic management in the newly appeared organization was completed by means of exploring strategy model which comprised three main elements and included “understanding the strategic position of the organization, making strategic choices and managing strategy into action” (Johnson, Scholes, & Whittington 2009, p. 3).

To understand the strategic position of the company, it is important to check the environment, purpose, culture and capability of each of the companies. Credit Agricole was a France rooted company which followed socialist model. Its purpose was to take deposits and secured loans.

The company managed to gain retail strong presence and reputation with family style and farming based culture. Credit Lyonnais, vice versa, developed corporate, profit driven, aggressive environment and culture. Additionally, the purpose of the company was to invest in multiple products and invest in multiple products.

Dwelling upon the strategic choices, one should remember about corporate and business levels, international relations, innovation and evaluation. Credit Agricole has presented themselves in strategic choices as follows. The company performed at the corporate level as French oversights and head level, and at business one as the company which incorporated into Credit Lyonnais.

Internationally, Credit Agricole performed as the right size staffing for merge in comparison with integration, respect and rebranding strategy of Credit Lyonnais. Credit Agricole has chosen US – SEC approval to operate. Finally, this company has not offered any ideas for innovations.

Credit Lyonnais, vice versa, adapted and continued innovative investments for searching solutions and building market reputation. Dwelling upon corporate level, Credit Lyonnais downsized locally, but expended internationally.

Considering the strategy in action of these two organizations, it is important to pay attention to the process, organization, changing, resourcing and practice. Credit Agricole is responsible for complete KYC and audit risk evaluation. The company was team approach and goal oriented that helped them reach the desired results, even though the company did not plan any changes. Outsourcing was really important in Credit Agricole.

Strategy in action for Credit Lyonnais was provided in a different way. This difference may be explained by the specific changes and innovations which were planned. Additionally, the company did not have outsourcing as believed it to be cost containing. The company directed its actions at maximising profit by means of spread and risk accountability and corporate, profit driven, aggressive practice.

Therefore, Credit Lyonnais and Credit Agricole were rather different and the merge of such companies required much attempt for cooperation and successful work as one united company. Kotter’s eight steps (1996) were chosen as the company successful plan for innovation and change.

Thus, considering at the Kotter’s steps implementation in the process of innovations and change, it may be concluded that the company successfully completed its tasks. The first step was successfully completed at the company managed to access the emergency by means of examination of the market and competitive realities.

The banks understood the major opportunities and the merge was one of those potential successes the organizations predicted. The next step which was implemented is the creation of the powerful friendly team with positive working environment. The department of the HR management did much for creating a strong and supportive team of the employees.

A specific group was created which followed the innovation and change process. One of the most important impacts of innovation and change on this process was the opportunity to encourage the employees of two different companies to work together as a team. The next step in Kotter’s method (1996) is the creation of the vision and mission of the company.

Looking at the merge of the companies as the process of innovation and change, we did all possible to direct the vision at ten change effort and develop appropriate strategies which could help achieve the new vision. We managed to succeed with this step as otherwise, the failure to clarify the vision would appear to be just a list of confusing projects which could result in nowhere.

The communication of the vision was the next step which was successfully completed. To be specific, the merge of two big companies into the magnificent organization was a successful affair as having set the vision, we managed to communicate that vision by means teaching employees new strategies aimed at working in team.

While implementing innovation and change a newly merged company made a stress on team work and the successful coalition of the team. The process of innovation and change is considered to be rather complicated training and team support are the guarantee of effective implementation of the issue.

The empowerment of the employees for broad-based action is the next step which was provided for innovation and change implementation based on merge of two banks. The companies managed to get rid of the obstacles that helped them change structure of the company and merge without visible complications. The agreement for merge was considered beforehand and the stress on the mutual advantages and benefits was made.

Therefore, the change of the vision was inevitable. The newly emerged company became bigger that presupposed larger spread on the market, occupation of the greater niche and serving more customers who are ready to trust them.

The merge of Credit Lyonnais and Credit Agricole was successful as we managed to avoid the mistakes connected with organizational structure. Having paid much attention to HR management and the employment and positions of the future staff, we did all possible to incorporate enough knowledge in the sphere and help each employee feel protected.

It was important to generate the short-term wins and the newly created company managed to do it appropriately. First of all, the plan for visible improvements was created.

The company partially focused on retail banking operations, sold off “85 branches in 18 départements of France” during 2003 and placed “a moratorium on opening new agencies in 32 départements” for a period of two years after that (‘Crédit Agricole takeover of Crédit Lyonnais approved’ 2003, n.p.).

The merge was beneficial to parts and the ability to understands it has managed to create one of the largest financial institutions in France “with almost 9,200 branches from a total of 35,000” (Keers 2003, n.p.).

Additionally to the plan, looking at the merge from the perspective of time it may be concluded that the company managers managed to create those improvements and reorganize the employees who were involved in the innovation and change process.

Even though the company merged several years ago and the short-term visions have already been completed, it is not the reason to stop the process of innovation and change. According to Kotter’s steps, the next stage of innovation and change process is the consolidation of the improvements and continuing change.

The newly created organization on the basis of the merge of Crédit Agricole and Crédit Lyonnais has managed to use appropriately the newly emerged structures and practices. Much attention is paid to staff that is able to implement changes and improvements.

Training and personal development are the spheres which are considered in detail by the HR managers. Additionally, the managers encourage employees to take part in new projects directed at the improvements in the company and its faster development.

It should be mentioned that the company managed to come through a number of challenges and succeed in employee organization, work with customers and dealing other problems which might occur because of merger. The appropriate organization of staff is one of the most important barriers which should be overcome for further successful functioning (Kanter 2009).

Human resources are the basic guarantees of the company success. The newly emerged organization paid much attention to organizing the work of the staff appropriately, that is why the merger which is considered as the change and IT human resource monitoring, aimed to be the innovation, were completed on the highest level.

However, there were some situations when innovations and changes were not that successful as it might be. The desire to follow Kotter’s eight steps (1996) up to the end resulted in failure. Implementing Islamic banking as a part of the innovation and change strategy, we failed to complete two final steps of Kotter’s model successfully.

Instead of declaring victory, the company managers afforded credibility by the short-term wins, which was inappropriate. Thus, having a desire to consolidate gains and produce more change, our team tried to implement Islamic banking. We failed to succeed and as a result the eighth stage in the innovation and change process was also unsuccessful.

Due to the peculiarity of the Islamic banking strategy, the company failed to anchor new approaches in the culture. Great difference in the models which were used and Islamic banking lead to the failure to root the new strategy.

That is why it seemed aggressive and strange for the employees who refused to accept it. Too fast implementation of Islamic banking led to the problems in the creation of a corporate culture which was sharpened.

The choice of the Islamic banking is explained by the desire to incorporate the strategy which seemed successful and prosperous for other organizations. To “give protection to the property of people and to eliminate widespread injustice in the society” (Alam, Noreen, Karamat, & Ilyas 2011, p. 195) are the main advantages which attract different organizations for applying this strategy.

However, being based on the principles of Qur’an and Sharia law, Islamic banking differs greatly from the European principles of running business.

It is obvious that Islamic banking is an absolutely different scheme and structure of business running. Being developed in a strange environment, Islamic banking differs greatly from the laws and principles according to which banking is led in Europe. Therefore, the implementation of Islamic banking as the strategy for innovation and change in combination with Kotter’s eight steps (1996) was a really good idea.

The main problems appeared at two last stages where the consolidation was to be provided and cultural aspects were to be met. Islamic banking is subjected to specific Islamic law characterised by the cultural aspects of Islamic countries (). Therefore, it is really difficult to implement the strategy in European business.

Even though some steps of the Kotter’s strategy were managed to be completed, the strategy was not implemented up to the end and that is why it is considered as a less successful one. Therefore, being a head of Marketing and Communications in Credit Agricole, my responsibility was to build the banks brand and transform the conventional banking view of what Islamic Banking meant.

Islamic banking differs greatly from modern understanding of investment banking due to its specific attitudes in to relation income. Suggesting a correlation between Islamic and ethical banking, we managed to create an easier reference point for the traditional banking mentality. Much work was completed in line with Kotter’s eight-step theory however in the evaluation process it was concluded we failed in the final two steps.

One of the main principles in Islamic banking is disclosure of information which should be fully available to the stakeholders (Malik, Malik, & Shah 2011). However, this contradicts to confidentiality of the data which becomes urgent in the era of information war. Therefore, the inability to apply this aspect of Islamic banking strategy added to the inability to implement the system.

We tried to use Islamic banking as an innovation which had to encourage the employees for the change, however, another system, other principles and ideas were not implemented in the organization in an appropriate way. Different legal principles also impacted and added to the failure of the affair (Aishath, Wisham, & Hassan 2010).

The failure to communicate Islamic banking resulted into unsuccessful innovation and change process. We assessed the risk, however, it is difficult to get the whole picture of innovation and change as it has already been mentioned, managers can only plan the consequences and make predictions, however, they are unable to know for sure how an innovation and change process would result (Ibrahim, Ismail, & Zabaria 2011).

Assessing personal steps and relating those to Kotter’s (1996) eight steps of organization transforming, it should be stated that the failure to apply Islamic banking concept to the Western countries is grounded. It could be said that we as a bank failed at the final two steps of the process.

Therefore, analyzing the steps completed while merger of Credit Lyonnais and Credit Agricole, it should be stated that the first steps were perfectly accomplished, that is why they are going to be mentioned in the action plan just to make sure that the process is logically accomplished. Consolidating gains and producing more change and anchoring new approaches in the culture are the steps which should be reassessed.

Creating personal action plan for the further development, it is important to base the future research on the mistakes and deep analysis of the reasons for failures in the current cases. As it has already been mentioned, two final steps in Kotter’s strategy were not fulfilled. That is why, the work should be based on consolidation gains and producing more change along with anchoring new approaches in the culture.

Personal action plan should be directed at the development of new strategies aimed at increasing the possibilities for change. The differences in Islamic culture should be considered with the purpose to get only the best out of the strategy.

The merger of Credit Lyonnais and Credit Agricole should presuppose the change of the environment in the organization. The employees should feel that the company develops in one specific direction.

The merger of two organizations presupposes the conflict of cultures, however, the presentation of a new development plan and the interest in employees’ points of further development of the organization culture may help complete the sixth step in Kotter’s strategy. The final stage is the changes implementation.

Thus, the employees should be informed about the further changes as in this case they are going to be ready and their reaction to the innovations will be much better than in case of unexpected implementation of the new program.

Moreover, leadership should become the priority as being guided, employees usually perform their tasks better, they are aware of what they should do as their direct responsibilities without wasting their time of other tasks.

Assessing personal steps from critical perspective, it should be stated that the main mistake was in failure to draw correct conclusions about the readiness of the organization to accept the Islamic banking principles. I had to conduct a research and consider whether the organization was ready or not.

In case of failure to correspond to the results it could be possible to maker appropriate preparations and the outcome of the Islamic banking implementation could be different. At the same time, the failure only at the last two steps shows that the general scheme of innovation and change was effective. The problem appeared at the stage of culture implementation.

That is why, the cultural aspect should be considered in detail. Moreover, the communication should be developed to make sure that the next time when Islamic banking procedure is going to be incorporated, the innovation strategy will be fulfilled up to the end.

Thus, personal action plan should make a stress on leadership as it is proposed by Mokhber, Ismail, and Vakilbashi (2011) who dwell upon positive leadership impact of organizational culture on innovation and change management. In other words, implementing innovation and change, a manager should remember about leadership as an inevitable part of those processes.

Therefore, it may be concluded that the implementation of the merge of Crédit Agricole and Crédit Lyonnais was a partially successful process of innovation and change as the newly appeared company managed to organize employees and direct them on further changes and improvements.

However, the company was unready for greater changes connected with the implementation of another strategy, Islamic banking, due to cultural differences. This case is going to be used as the role model for developing the personal action plan for promoting an unknown brand at the international market.


Reference List

Aishath, M, Wisham, I, & Hassan, R 2010, ‘The Paradox Struggle Between the Islamic and Conventional Banking Systems’, Journal of Asia Pacific Studies, vol. 1, no. 2, pp. 188-224.

Alam, H, Noreen, H, Karamat, M, & Ilyas, M 2011, ‘Islamic Banking: Insulation against US Credit Crisis’, International Journal of Business & Social Science, vol. 2, no. 10, pp. 193-201.

Bhattacharyya, S 2006, ‘Entrepreneurship and Innovation: How Leadership Style Makes the Difference?’, Vikalpa: The Journal For Decision Makers, vol. 31, no. 1, pp. 107-115.

Clegg, S, Kornberger, M & Pitsis, T 2005, Managing and organizations: an introduction to theory and practice, SAGE, New York.

’ 2003, Euronline. Web.

Ibrahim, W, Ismail, A, & Zabaria, W 2011, ‘Disclosure, Risk and Performance in Islamic Banking: A Panel Data Analysis’, International Research Journal of Finance & Economics, vol. 72, pp. 100-114.

Johnson, G, Scholes, K, & Whittington, K 2009, Exploring Corporate Strategy with My Strategy Lab, Pearson Education, Oxford.

Kanter, RM 2009, ‘’, Harvard Business Review. Web.

Keers, H 2003, ‘’, Telegraph. Web.

Kotter, JP 1996, Leading Change, Harvard Business Press, New York.

Malik, A, Malik, M, & Shah, H 2011, ‘An Analysis of Islamic Banking and Finance in West: From Lagging to Leading’, Asian Social Science, vol. 7, no. 1, pp. 179-185.

Mokhber, M, Ismail, WKW & Vakilbashi, A 2011, ‘The impact of transformational leadership on organizational innovation moderated by organizational culture’, Australian Journal of Basic & Applied Sciences, vol. 5, no. 6, pp. 504-508.

Mors, M 2010, ‘Innovation in a global consulting firm: when the problem is too much diversity’, Strategic Management Journal, vol. 31, no. 8, pp. 841-872.

“The mapping and merger of Credit Agricole SA” n.d., Success Story. Web.


The exploring corporate strategy model.

Figure 1. The exploring corporate strategy model

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