Introduction
With globalization a concept which is characterized with free movement of people, goods, services, capital and high level of interconnectedness, the world economy has experienced changes across all quotas. Scholars have argued that those organizations that are capable of successfully managing organization change will remain relevant and competitive in this dynamic world (Cascio 2002).
Since I am working at an international banking department at the Bank of America, my analysis will focus on my place of work. The statement to be analysed is “Change is inevitable. Organizations have to adapt their HRM activities between short-run responsiveness and long-run agility, which can result in tensions between employers and employees.”
To accomplish this task, a critical discussion of issues concerning organizational flexibility as argued by Atkinson’s in the flexible model and Dyer and Shafer’s agility model providing a thorough analysis of available empirical evidence will be done. It is no doubt that the human or employees in a given organization is deemed to be the most important assets. When their different potentials are tapped successfully, firm can attain competitive advantage over its competitors.
Literature Review
Atkinson’s Flexible Model
This model tries to address the rigidities linked to rules of employment established under the scientific organization design. Atkinson (1984) stresses the importance of organizational flexibility.
The researcher notes that this is one of the ways to remain competitive, i.e. successful in the contemporary business world. Organizations should be able to comply with new rules and principles of the business world. Atkinson’s model is based on four major types of flexibility: external and internal numerical flexibility, functional flexibility and financial flexibility.
Thus, the researcher notes that external numerical flexibility can help organizations fit the changing business environment. Thus, organizations can hire employees from external markets. Organizations can hire employees to fulfil specific tasks. Thus, the researcher notes that short-term contracts can make organizations more flexible. Basically, Atkinson (1984) claims that temporary workers should not be underestimated. This kind of flexibility will encourage (part-time as well as fulltime) workers to fulfil tasks properly.
Internal numerical flexibility presupposes flexibility of employees’ working time. Thus, some workers can work part-time. Atkinson (1984) suggests that organizations can make use of shifts. This flexibility will encourage workers to manage their time properly and try their best to fulfil their tasks. This flexibility can motivate employees as they will be able to combine their work and their family life, which is very important.
Notably, more employees are available for organizations: part-time workers can be those who work and study, working mothers, etc. Admittedly, such flexibility is beneficial for both organizations and employees. Of course, this type of flexibility enables organizations to operate seven days a week 24 hours a day. This will definitely keep organizations competitive.
Functional flexibility is also very important as it helps the organization be competitive. This type of flexibility concerns employee’s ability to fulfil various types of tasks, work in different teams, function in different situations, etc. Atkinson (1984) notes that employees should be ready to implement various activities and take part in different projects.
Workers should be ready to cooperate with each other and form different teams to fulfil a variety of tasks. The researcher adds that this can be possible if organization pays enough attention to education and training. Thus, the researcher notes that organizations should launch various educational courses to make their employees flexible. This flexibility contributes greatly to the overall organization’s flexibility.
Finally, Atkinson (1984) singles out financial flexibility which is also very important. This component of Atkinson’s model presupposes various types of rewards for appropriate or exceptional performance. The researcher mentions that performance assessment activities should be held.
Employees should be aware of the assessment system as this will encourage them to perform better. Organizations can reward individual employees or teams. In fact, Atkinson (1984) states that employees should be paid (not only rewarded) in accordance with their individual or group work. This keeps employees motivated.
Dyer and Shafer’s Agility Model
As far as Dyer and Shafer’s agility model is concerned, it is necessary to note that it has a lot in common with Atkinson’s model. Dyer and Shafer’s model presupposes companies’ rapid adjustment to changing business environments (Dyer & Shafer 1999). Organizational agility model can be divided into several basic principles. In the first place, the researchers state that organizations will benefit from organizational agility which is essential in the contemporary business world.
Admittedly, organizations should focus on achieving the necessary level of agility to remain competitive in the business environment (Boxall et al. 2003). Of course, understanding of the necessity to be competitive is not enough. Organizations should take certain steps to achieve agility.
First of all, organization should be able to understand potential of existing and upcoming markets (Dyer & Shafer 1999). It is important to understand the needs of these markets. The organization should be able to respond to changes which are taking place or are about to take place.
Of course, the organization should also be able to ‘open up’ new markets. Dyer and Shafer (1999) claim that it is impossible to see various changes in business environment without proper training. Therefore, organizations should train the staff. Employees should learn constantly. Trainings, discussions, experiments, workshops and conferences should be held to train the staff. Employees should share successful experience and cooperate to work out new ways to run business.
Apart from training, it is essential to create the necessary environment to encourage employees (Dyer & Shafer 1999). Employees should be encourages to display initiative. The researchers note that employees should be ready to work in teams. Notably, employees should be ready to work in different teams depending on the goal pursued (Dyer & Shafer 1999). Basically, employees should be ready to effectively collaborate with each other.
The researchers also note that employees should be goal-oriented. It is crucial to make employees aware of the goals the organization pursues. In other words, the staff should know the plan they can follow. It makes employees more motivated as they know where they are moving. Furthermore, employees should know and share the organization’s values. This will make the organization a single team which operates as a whole.
Besides, Dyer and Shafer (1999) claim that organizations should exploit flexible work design. In essence, this is one of the most important measures which can help an organization achieve agility.
The researchers also stress that proper communication is extremely important. On one hand, communication should be extensive. Employees should be aware of the processes which are taking place. Flexible working conditions are also crucial for the organization’s agility. Some employees can perform certain tasks better when certain flexibility is available.
Finally, Dyer and Shafer (1999) state that employees should be awarded properly. The researchers note that bonuses and rewards for certain performance or productivity level should be implemented.
Rewards can be monetary as well as non-monetary (promotion, etc.). The researchers also note that appraisal and feedback are crucial to create the necessary environment at workplace. Employees should understand that their performance is evaluated. Employees should understand that some ways can be awarded while certain behaviour can be punished.
Applications
Since its foundation in 1998, the Bank of America has grown to be the third largest bank in the world. It managed to expand its operation to more than 150 countries. However, financial crisis and stiff competition from major competitors such as Wells Fargo, JPMorgan Chase and Citigroup has completely changed everything for a bank that enjoys a 99.0% relationship with Americans.
To ensure that the Bank remain competitive, the management decided to adopt a set of three strategies which included initiating new services and products, adapting to new changes and delivering high quality services and products to clients.
It is no doubt that the bank through initiating new product and services, it realized that this can only be possible if it forms mergers, acquire competitors and actively engage in joint ventures (Dyer & Shafer 1999). For instance in 2008, the firm acquired Merrill Lynch which later made the Bank of America the largest bank in terms of wealth management. This came with some challenges and tension among employees particularly about their job security.
In order to succeed in implementing the three approaches, it was deemed fit to redefine employees’ behaviours. Thus there were some agile attributes that were developed. The first one was to have a dedicated team of employees. The purpose of this was to ensure that workers were to be totally committed to the success of the bank. Workers were to identify with the bank instead of their department and a personal commitment based on the sense of perceived mutual advantage (Dyer & Shafer 1999).
Accountability was another agile attributed to be natured by the human resource department. Workers were to be responsible of their actions while engaging in activities to help the firm attain its goals and objectives.
The concept of generative was also encouraged. This was deemed to help the bank approach issues at a different angle and more effectively. Lastly workers were to be resilient, that is they should accept and take change positively. This could be demonstrated by their ability to take on calculated risks (Connor, Lake & Stackman 2003).
It is necessary to note that the Bank of America has exploited Atkinson’s flexible model as well. This resulted in placing all knowledge of the assignment with the management (Denhardt & Denhardt 2006). This resulted in negative consequences such as less motivated and satisfied employees which later impacted on the productivity. The concept of flexibility was deemed to help remove rigidity created by the rules. Currently the bank has a workforce who are highly skilled are capable of participating in making rational decisions (Hughes 2007).
There are three kinds of flexibility which bank of America has strived to attain. One is functional flexibility, this is where the managements is allowed to move employees around jobs as the need arise. However, it is worth noting that since the bank is a place with high level of specialization, the Bank of America has not fully managed to ensure all employees are moved between jobs.
Before employees are moved between jobs, the bank carryout an extensive education and training programs, this later has been shown to reflect on product requirement instead of the traditional way of doing business. It is worth mentioning that although some workers support this strategy, there are some who find it very difficult to move out of their usual work stations.
Concerning financial flexibility, this usually makes it possible for the firm to evaluate the cost of labour to reflect on the supply of as well as demand for labour. As a result compensation package fluctuates based on the market worth of any given labour requirement.
Lastly numerical flexibility helps the management to match the needs for employees with the number employed usually attained by using different short-term employment arrangements such as part-time employment, short contracts, contracting and outsourcing. When Bank of America adopted this strategy, other employees begun getting worried and some actually left since they were convinced that the future of the bank was doomed.
Of course, rumours can be really serious issue to be solved. As suggested by Bordia et al. (2006) rumours are verbal symbols and expressions of employees concerns and come about before formal announcement and it usually centres on predicting change and alleging its dire consequences. One of the most effective ways to address the problem is to issue official reports, and other documents.
Conclusion
From the review of managing people in the Bank of America, it is evident that the human resource is an important asset that gets everything rolling. Since change is inevitable, employees tend to be affected by change. Thus organizations have to adapt their human resource management activities between short-term and long-term responsiveness and agility in that order.
This can result in tension between employers and employees. For instance when the bank acquired one of its competitors, some workers were worried of losing their jobs. However, to curb such tension, there is need to effectively communicate in an open manner and engage workers from the beginning to the end of the change process.
References
Atkinson, J 1984, ‘Manpower strategies for flexible organizations’, Personnel Management, vol. 1, no. 1, pp. 1–13.
Bordia, P, Jones, E, Gallois, C, Callan, V, & DiFonzo, N 2006, ‘Management are aliens!: Rumors and stress during organizational change’, Group & organizational management, vol. 31, pp. 601-620.
Boxall, P. and Purcell, J (2003) Strategy and Human Resource Management. Palgrave Macmillan, New York, NY.
Cascio, W 2002, ‘Strategies for responsible restructuring’, Academy of Management Executive, vol. 16, no. 3, pp. 80–91.
Connor, P, Lake, L & Stackman, R 2003, Managing organizational change, Praeger Publishers, Westport, CT.
Denhardt, R & Denhardt, J 2006, Public administration: An action orientation. Thomas Wadworth, Belmont, CA.
Dyer, L & Shafer, R 1999, ‘From human resource strategy to organizational effectiveness: Lessons from research on organizational agility.’ In P. Wright, L. Dyer, J. Boudreau & G. Milkovich eds. Strategic human resource management in the 21st century. Research in personnel and human resource management, supplement 4. JAI Press, Stamford, CT.
Hughes, M 2007, ‘The Tools and Techniques of Change Management’, Journal of Change Management, vol. 7, no. 1, 37-49.
Paauwe, J & Boselie, P 2007, ‘HRM and societal embeddedness.’ In J. Purcell & P.M. Wright eds. The Oxford handbook of Human Resource Management. Oxford Handbooks Online, New York, NY.
Pendlesbury, J 1998, The ten keys to successful change management, John Wiley & Sons, New York.