Organizational change is also known as organizational transformation and it may involves organisational change in mission, introducing new technology, restructuring operations, introducing new programmes, mergers, re-engineering and having new major collaborations. (Bridges 1991) Organizational changes are aimed at achieving some set organizational goals and objectives which need to be a attained within a given period of time.
In many cases changes in the organizational are provoked by some outside forces which includes taking care of new markets, substantial cut in finding, need for increase in services and productivity among others. There are many approaches that managers uses to introduce change in the organization, some are planned, explicit and structured while others are more unfolding, implicit and organic. Managers goes for the approaches that will be supported by all the employees and those that will enable the organization to maximize the profit margin as they achieve the set goals and objectives within the set time frame.
Some approaches works from the future to the present where by the managers uses the organization’s vision to plan all the organizational activities aiming at achieving the vision while other approaches works from the present to the future which may include pointing out the currents needs of the target clients and then making the necessary changes towards achieving those needs. This is the best approach since the clients and other stakeholders are the backbone of any organization and they determine the success of the any business (Easterby 1999).
Identifying their needs should be a continuous exercise which should be followed by implementing the necessary changes which will facilitate in satisfying their needs hence building a good and strong customer relationship which will lead to increased sales hence increasing the Organizational profitability (Dent 1999). Aegon UK is a member of the AEGON Group which is among the world’s largest life insurance and pension company. The company is the owner of different life insurance, pensions, adviser and management businesses in the UK (Folger 1999).
The company has 27,000 employees and a total of over 25 million customers worldwide with it’s main markets being in Netherlands and the United States. Factors That Lead To Change One of the major hindrance for decision making is a clear understanding of the working environment where the decisions made will be operated. (Brewster 2004) Proper understanding of the working environment improves the decision making and it minimizes uncertainty.
In the UK where life expectancy has risen in the past few years, people are expected to retire for a longer period of time hence the need to think ahead and save for retirement, an idea that many people find difficult to comprehend. (Kotter 1979) Many people do not properly plan about their retirement hence they suffer during the old age since they do not be have enough money for survival and on the other hand the government is also emphasizing on reduced dependency on the state in old age.
This resulted to many insurance companies coming up with new cheap pension schemes who also emphasized on employee pension (Hultman 1995). The Industry Aegon operates in the life insurance and pension industry which for the past few years had a poor reputation. Some organisations in the industry has been blamed of mis-selling where by they do not give the customers quality products that satisfy their needs. (Johnston e 2004) The Financial Services Authority (FSA) introduced some regulations in the industry which were aimed at avoiding such situations from happening again in the future.
The industry has been faced with intense competition where by AEGON is competing with other organisations that are well known in the UK and they specialise in selling directly to the customers (Kirkman 2000). The company normally distributes it’s services and products to customers through financial advisers. For AEGON to remain competitive it had to take care of all the problems that the industry was facing. Reasons For Change Historically AEGON had been very successful and profitable but some times back the government introduced some regulations that reduced the organisation’s profitability.
Comparing the company with it’s competitors, AEGON was not well known though it had very good services and products and it also had good relationship with the distributors. (Strebel 1996) For consumers to have the confidence of investing in a long term product, they have to know more about the organisation they are planning to invest with by learning more about the brands that are being offered by the organisation and by understanding the value of each brand. As AEGON offered different brands it was hard for the financial advisers and the consumers to identify and understand the different depth and breadth of the brands.
Facilitators of Change AEGON company appointed a new (CEO) Chief Executive Officer who entered into the office with new strategies for the company and the first thing that he implemented was to bring AEGON into a discovery phase which would help him in achieving the goals he had for AEGON. The CEO’s goal was to develop the best long term savings and protection business in the UK while the discovery phase was aimed at finding ways of achieving those goals. (Kegan 2001) Another aspect that needed consideration was the company’s brands and how they could be audited.
The company was examined both internally and externally to find it’s position in the market. The process of auditing was aimed at giving more information about the company which assisted AEGON in making more informed decisions which were needed to start the process of change. Creating a New Culture Culture refers to the attitude and the personality of an organization and it is also involves the shared values, behavior and beliefs of the employees and other stakeholders (Morgan 1997).
It acts as a key part in the change process since it dictates the way in which the organisation and the stakeholders solve problems and makes decision. By developing a new culture, AEGON was able to provide services and products that were required in the market hence they were able to remain competitive. A Behavior Framework In order to support the new culture, AEGON came up with a behavior framework which was aimed at strengthening the brand values.
It was designed in such a way that it could influence how all the employees in the organisation could work and make decisions where by the behavior emphasized the values of AEGON. (Coetsee 1999) The company also introduced a Management Development Programme which emphasised on eight main behaviors which are, think customer, embrace change, encourage excellence, act with integrity, decisive actions, work together, learn and grow and finally relate and communicate (Piderit 2000). Implementing The Change The organisation has emphasised on the customer’s needs which determines the decisions, behaviour and it also informs actions.
The senior mangers keeps the customer’s needs at the heart of all the operations in AEGON while the other managers and professionals innovates with the needs of the customers in mind so that they come up with products and services that can satisfy the needs of the customers. AEGON brand have been extensively promoted alongside Scottish Equitable or other brands are traded under it. Association with AEGON is stronger where by the Scottish Equitable is currently AEGON Scottish Equitable which reflects the local knowledge and the global power.
Currently all the brands has a new look that is common, different and refreshing. Impacts Of The Changes Implementing change in AEGON affected it both externally and internally. Internally the changes influenced how the people behaved and communicated while the organisational operations has been focused on satisfying the needs of the customers. Great emphasis has been on making information clearer so that the customers can be in a position to understand the company well so that they can do business with them.
The company has intensively done external promotional campaigns and it has managed to launch new innovative products aimed at satisfying the customer’s needs. This changes has worked very well for AEGON since the company has been able to maximise it’s profit. Currently AGEON brand is in a position that it influences the financial services in the industry. Challenges The main challenge that AEGON is facing is that the competition is growing at a very fast rate in an increasingly difficult market.
This has forced the government to implement some regulations to govern the industry. To fight competition, AEGON should maintain two way communication channel which should be open and they should emphasis on getting feedback from all the stakeholders. This feedback is very important since the stakeholders can inform the organisation where they might be going wrong and can even give some recommendations which can work very well for the company hence being ahead of the competitors which leads to maximising the profit margins of the company.
The stakeholders can also help the company in identifying the needs of the customers hence enabling the company to provide what is needed in the market . Also when there is open communication between the management and the employees it is normally very easy to prevent conflicts since the employees will be free to air their grivances hence cultivating a culture of good working relationships in AEGON which will even motivate the workers to work even harder thus enabling the company to realize the set goals and objectives within the set time frame.
Conclusion Organisational change is continuous and the process of change is like a journey which will be faced by external factors that can affect the operations of the organisation. AEGON respond to the external factors was by clarifying, simplifying and strengthening it’s brand in the UK. As the organisation changes, it’s culture and pattern of behavior develops which is a cycle which requires the business to use the knowledge it has to learn from the experiences.
This has enabled AEGON to move towards achieving its goals through realizing its full potential while they remain competitive in the market. Taking care of the needs of the customers increases the sales of the company since many customers will be interested in the products or services that are being provided by the company hence increasing sales which in turn increases the profit margin of the company.
University/College: University of California
Type of paper: Thesis/Dissertation Chapter
Date: 12 January 2017
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