Coaching and Developing People in Lloyds TSB Bank - Case Study Example

Coaching and Developing People in Lloyds TSB Bank Name: Course: Tutor: Date: Introduction Organisation development is all about recognizing the importance of people and change. People in an organisation must see the clear and present need for implementing change and appreciate the importance of the same. For instance, it is important for the organisation to focus on how best its customers can be satisfied and how effectively its competitors can be neutralized instead of thinking of the organisation as a staring point and trying to modify it. By recognizing the need to better satisfy customers and tame competitors, an organisation is able to develop new approaches and systems to replace existing ones. Hawkins and Wright (2009) emphasise the need for organisation development by noting that the days when organisations could outsmart their rivals by simply having the best knowledge, quality or technology are gone. They further suggest in the contemporary world, having employees who get on well with each other and their customers is of critical importance (p.1). Effective change management requires a blend of top-down and bottom-up investment. Strong leadership is also required to ensure that the new changes are implemented, but in most cases, most directions are perceived to be initiated by the top management. Thus, to eliminate this perception, there is need to embrace employee participation so that everyone in the organisation expresses a point on the direction of the organisation. Nevertheless, it is also important to note that too little involvement of the top management may create an implication that the management does not care. Hence, caution must be taken to ensure that there is a balance of every aspect of management (Griffin, 2006, p. 356). One of the organisations reputed with effective management in the world is Lloyds TSB Bank. Methodology This paper will consider this a case study on the importance of coaching and developing people as a precursor to effective organisation management and development. The paper thus identifies the problem that affected the organisation with respect to management and discusses how Lloyds TSB Bank came up with a solution to ensure effective management and communication within its various departments. One of the key problems that faced Lloyds TSB Bank over the years was lack of proper communication between line mangers and other staff, as well as between departments. Initially, the firm had implemented a one-size-fits-all management system that unfortunately did could not suffice the needs of every individual in ensuring that customers and other stakeholders in general were satisfied. In order to work out the consequent problem, the bank implemented a mix of management systems. These include a new company training program that was aimed specifically at operational and support staff and supported with management training, and improving efficiency within the business banking network segment. The paper discusses in detail how the implementation of the new strategies was effected, but first is a literature review on the importance of training, coaching and organisation development. The method employed in the research is an exploratory survey, reviewing books and peer reviewed articles that focus on organisation development, coaching - specifically with reference to Lloyds TSB Bank. Literature review Organisation development (OD) is an effort that is planned, organisation-wide and managed from the top, aimed at increasing organisational effectiveness and health through organised interventions in the organisation’s process, by applying behavioural science knowledge. OD is concerned with changing people’s attitudes, behaviours, perceptions and expectations. The theory and practice of OD are rooted on several key assumptions. The first one is that employees have the yearning to grow and develop. Second is that employees have a strong desire to be accepted by others within the organisation. Another assumption is that the entire organisation and the way it is designed will affect the way different individuals and groups in the organisation behave (Griffin p. 356). As such, there is need to have some form of collaboration between managers and their employees in order (1) capitalise on the skills and abilities of the employees and (2) do away with aspects of the organisation that hold back employee growth, group acceptance and development. Nevertheless, recognition of the need for organisation development per se is not a precursor to effective people development as will be discussed next. According to Stenzel and Stenzel (2003), there are a number of obstacles that impede positive transformation and progress during coaching and development of an organisation’s staff. First is that the executive leadership may place unrealistic demands on an unprepared or not adequately supported management group. Second is that the executive leadership may not be able to or may be unwilling to see the wisdom of local recommendations, especially when they emanate from process managers. Third is that the manager-recommended changes may be unsuitable or too advanced for organisational needs, or may require investments in human and mechanical capital that may be too costly for the entire organisational community. In addition, specialist employees may aggressively step of the scope of their activities, with incomplete knowledge of the global picture, pushing for process changes. There is also a possibility managers may hold too closely to familiar (that is comfortable) suboptimal systems. Most importantly, when senior managers take an autocratic approach to leadership, the may constantly ignore suggestions made by specialist employees – of course at the expense of the organisation’s development. As well, there may be a propensity by the specialist employees to ignore new methods, tactics, strategies and processes even as the organisation experiences high turnover and generally poor performance (Stenzel and Stenzel, 2003, p. 24). As such, coaching and development becomes an onerous task. Task-oriented coaching is one of the most commonly used methods of organisation development. It is widely used to provide a more tailored developmental experience especially for senior and middle managers. Nevertheless, coaching can sometimes fall into exactly the same noose as other types of management intervention. There is a possibility that either managers may seek to comply to predetermined learning tasks, in the belief that this will allow them to fit better with the leadership requirements of the organisation, or they may discount the learning in a defiant way, on their own believing that they will continue to be effective if they stick to their initial styles (Lee, 2003, p.16). Relationship between the human resource and the coach For organisations that consider performance as one of the core aspect of customers satisfaction, coaching a regarded a habitual phenomenon. For this reason, many human resource managers find it beneficial to maintain regular relationships with coaches and constantly hold meetings with them to deliberate on the progress of coaching, even if there is no current assignment. Along this line, it is a reality that coaches are more effective when they can relate to and talk about the realities of the learner’s working environment. This can be easily achieved if the human resource manager is prepared to give the coach vital information on the business and culture of the organisation. The human resource manager should thus keep the coach updated on changes within the organisation and inform the coach about the organisation development interventions that are available internally, the relevant internal relationships and other major change initiatives (Caplan, 2003, p.118). There is need for confidentiality between the coach and the learner, but many human resource managers expect coaches who train a number of people in their organisation to give them feedback about any issues that crop up on a regular basis. Up to this point, it is worthwhile to ask why an organisation should consider using an internal or external coach. It cannot be gainsaid that many organisations use internal coaches and mentors. Caplan (2003) notes that this has been the case of many organisations such as KPMG and Lloyds TSB (which is the focus of this paper). Caplan points out that in these organisations, internal coaches are used as facilitators for career development. The same organisations (and many other as well) use internal people, referred to as mentors, to support the more junior colleagues, to help them get to understand the organisation, or to help them with their career development. In this context, many beneficiaries of the coaching programmes support the notion of having a mentor or coach because the process raises the awareness of their abilities and gives them a broader understanding of the organisation and why it chooses particular strategies. Coaching and mentoring also gives learners insights into organisational decision-making and can indeed help them understand other roles and activities. Importantly, having the opportunity to be with someone as a role model in the organisation helps learners to advance their career (Veale, 1996, p.16). This is in line with the perspective that coaching culture is the successor to the notion of the learning organisation. The learning organisation is a theory that regards organisations as “learning systems” in which success depends on two fundamentals skills: giving direction and learning continuously (Caplan, 2003, p. 14). Garcarz, Chambers and Ellis (2003) define a learning organisation as one that is constantly expanding its capability to develop its own future (p. 1). This means that the organisation focuses on incessantly expanding people’s capabilities and developing new ways of thinking. This incorporates systems of thinking, shared vision, personal mastery, and team learning. A learning organisation will facilitate the learning of all its members and in the process consciously transform itself, contributing to the learning of the general community or context of which it is part. In essence, learning organisations are visions of what corporate structures can deliver when they identify with the value and contribution of their workforce through continued learning (Garcarz, Chambers & Ellis, 2003). Tjepkema (2002) discusses the theory of a learning organisation by stressing that learning-oriented organisations create facilities for employee learning and also stimulate employees not only to acquire new knowledge and skills but also to develop those skills in the field of learning and problem solving, hence promoting their capacity for future learning (that is learning to learn) (p.12). Along this line, it should be noted that learning is a multidimensional affair. Khandekar and Sharma (2005) suggest that organisational learning takes place at three levels. First is the individual level, in which learning consists of development of particular skills at the workplace. Second is the organisation level, in which members obtain a background for learning and guidance for future learning via shared experiences. Finally, at the organisational level, organisational learning tends to be more formal and results in the development and maintenance of procedures to facilitate learning outcomes (p. 213). Apart from employing internal coaching, there are instances when an organisation may consider using the services of an external coach to bring fresh and unbiased views on problems and who has views and knowledge gained from working with other organisations. While this may be a good idea, it may also seem to be problematic in that certain company issues need to be discussed only with an objective third party. For the purpose of discussing aspects of development at Lloyds TSB Bank, this paper focuses on internal coaching, and to some extent, external coaching as employed by the organisation. Review of Lloyds TSB Bank coaching and people development programme Lloyds TSB Bank is one of the biggest retail banking institutions in the United Kingdom. The group has more than 2,300 branches and has staff numbering 82,000 in the United Kingdom alone (King, 1998, p. 30). The corporation’s development programme began as early as 1995 on realization that there was need for a well equipped staff to meet its ever growing needs due to expansion. With the bank’s expansion, threats of job insecurity and low job morale became apparent (King, 1998, p. 31). Lloyds TSB also realised that since more than ten billion Britons were using telephone banking services and there were more than 11.5 million online accounts by the year 2002, there was need to ensure that its call centres could provide the best probable service to customers. In addition, the bank’s management wanted to ensure that staff were provided with the best possible place to work (Forsyth, 2004, p.15). More to this, the bank realised that there was a problem regarding enthusiasm among line managers. In order to improve in this area, attention was paid to management training to improve communication between departments and create a new momentum within the organisation (Pollit, 2002, p.324). This paper thus focuses on the three areas of development that were improved: Operational Skills Programme, call centres, and management training. Operational Skills Programme When Lloyds and TSB banks merged in the period 1995/96, the number of operational staff working within the now larger company increased twofold, creating a way for Lloyds TSB to develop an innovative company training programme aimed specifically at support and operational staff. The bank developed a new competency-based programme to provide operational staff with nationally certified on-the-job training. The training covered all the fundamental skill requirements for their jobs. The training programme was internally known as the Operational Skills Programme (OSP) and was done with the assistance Harris Associates, a training consultancy firm based in Birmingham. OSP was initially introduced as a fully developed pilot programme at the Lloyds TSB offices in Newport. By 1998, the programme had enlisted over 400 clerical and support staff, and there were more plans to roll out the programme throughout the other operational areas of the company. According to King (1998), OSP supported both the immediate and business needs of Lloyds TSB Bank, in addition to the longer-term personal development needs of the employees. The programme also encompassed the Management Skills Project, which successfully targeted the core managerial competencies across parts of Information Technology and Operation in the organisation. The initiative was complemented by provision of a competency-based training programme following a comprehensive review of the operational-level training. The second phase of training was specifically aimed at the needs of operational staff. The bank realised that to be effective, such a programme would have to address definite, local training requirements, guarantee as balance between short- and long-term needs and place emphasis on the delivery of excellent customer service. In addition, the programme design needed to ensure cost-efficient delivery and involve a strategy that would review existing training resources, to ascertain their relevance and availability to staff. The need for the OSP increased over time as it was realised that more candidates required more coaching to facilitate job retention and also boost job morale. The OSP entailed three critical stages namely evaluation, development of the framework, and implementation of the framework. The purpose of evaluation was to gain a picture of the existing situation in terms of the environment, culture and ethos, organisational objectives, methods of operation, appraisal of the system, attitudes, functional role analysis linked to organisation and national standards, and administration and tracking systems (King, 1998, p.31). From the details of the OSP, it can be noted that the programme was focused on many areas of development, and had with it a well designed evaluation plan to assess its effectiveness. The second phase, development, entailed setting up a flexible and robust framework that included developing systems and tracking, developing and implementing the coaching programme (which was integral to the implementation), identifying delivery teams (comprising both internal and external staff), and coming up with a project plan for roll out. Finally, the third phase of implementation involved creating role-specific programmes to support individuals in achieving the set goals, refining project management techniques, and ascertaining that the coaching culture was developed between candidates and the line manager. The overall benefits of the programme include a notable increase in motivation and morale at work and development of a clear objective competency-based appraisal system (King, 1998, p.31). Call centres In 2002, Lloyds embarked on working towards complying with best-practice standards implemented by the Call Centre Association (CCA) for the bank’s three main call centres. The CCA is an operating guide that is supported by the Department of Trade and Industry with an aim of providing a framework within which expectations of customer service and efficiency can be fulfilled. In order to fulfil this objective, a dedicated team at Lloyds, comprising people from the human resource and quality management departments from the three call-centre sites was formed to work towards CCA accreditation (Forsyth, 2004, p. 14-15). The team first worked on gap analysis to ensure that all the three sites conformed to the CCA standard and that there were adequate systems and processes in place to address each element of the framework. One of the key challenges that Lloyds TSB faced was how to reconcile the geographical discrepancy and reasons for departmental differences in the three call centres. The team therefore had to work on the reason for each difference identified and whether it a caused significant problem, so as to determine if anything needed to be changed. Forsyth (2004) notes that it was found out that the induction procedures were slightly different across the three sites; hence, these were checked to ensure that all systems complied with the set framework. Also developed was a multi-skilling scheme across the three call centre sites for agents to develop additional skills such as working on a different telephone service. As the amount of work increases, the multi-skillers are asked to draw on their secondary skill and will then move to work with a different team of people for a considerable period of time. Call centre agents are given opportunities to work their way through various levels, increasing competencies as they go, finally ending up in team-leader training. Lloyds TSB also offers a variety of other causes that enable people to move “sideways” from the call centre, either to head-office or branch positions. Management training Management training is one of the key aspects of coaching that have helped improve the skills of staff at Lloyds TSB Bank. The bank realised the need to have Independent Financial Advisers to help boost enthusiasm and among line managers, perk up communication between departments and enhance momentum within the organisation. The bank was intent on providing managers and aspiring managers in its Independent Financial Advisers department with the skills, enthusiasm and confidence to operate with verve in a highly-regulated marketplace. To achieve this, it launched the Open University Business School (OUBS) proficient certificate in management, combining it with other activities to enrich the curriculum and apply the skills to Lloyds TSB. The management training programme at Lloyds is credited for much of the fall in employee turnover from 22 percent to 6 percent in the period between 1997 and 2000 (Pollit, 2002, p. 324). When Mike Robinson was appointed as head of training and development, his role “was not to apply training as an organisational sticking plaster” (Pollit, 2002, p. 325). Rather, he aimed at realising the energy of the staff and achieving extraordinary things from people. The programme was organised such that participants were selected on basis of merit rather than tenure or rank. All members willing to participate in the programme were invited to apply and attend a meticulous one-day assessment programme encompassing interview on team tasks. Out of the 20 who attended, 12 were selected. Those chosen represented a broad cross section of the organisation, with a common objective to learn and improve. The actors were also involved in role-playing interviews so that they gained experience in recruitment and job promotion pursuits. According to Mike Robinson, participants in the training felt privileged and appreciated the idea that their employer had invested in them heavily. In addition, the course content provided participants with skills to analyse problem and come up with solutions (Pollit, 2002, p. 325). Lloyds also has a graduate training programme that aims at developing skills in five core areas, namely people management, strategy, relationship management, operations and change/project management (Pollit, 2005, p. 13). Conclusion Lloyds TSB Bank is one of the organisations that depicted organisation learning as a continuous process. According to the theory of the learning organisation, the success of learning systems depends on two phenomenal skills as noted in the paper: learning continuously and giving direction. A learning organisation also continually expands its capacity to create its own future. These are some of the fundamental aspects that have been discussed about Lloyds TSB Bank. It can be noted that the bank’s development programme was mainly task-oriented coaching as it was targeted for specific areas or departments and participants were involved in training while at work. All the three areas of training, that is, the Operation Skills Programme, call centres and management training were significant in solving problems related to Lloyd TSB Bank’s expansion such as low morale among staff, poor communication between departments and low enthusiasm among line managers. The same programmes also enabled the bank to retain its staff, as this turned around the staff turnover rate from 22 percent to 6 percent in period of just three years between 1997 and 2000. Recommendations The case study discussed in this paper highlights the significance of coaching and development as everyday practices in an organisation. It shows that organisations that aspire to transform themselves into successful systems must embrace coaching and training. It is therefore recommended that organisations should make coaching and development of people a routine exercise as this is the only way through which they can implement change strategies to cope with the current market dynamism. References Caplan, J. (2003) Coaching for the Future: How Smart Companies use Coaching and Mentoring CIPD Publishing, New York. Forsyth, A. M. (2004) “Lloyds TSB banks on call centre quality,” Human resource Management International, 12(1): 14-16. Garcarz, W., Chambers, R. & Ellis, S.J. (2003) Make your healthcare organisation a learning organisation Radcliffe Publishing, New York. Griffin, R.W. (2006) Management (9th Edition), Cengage Learning, New York. Hawkins, P. & Wright, A. (2009), ‘‘Being the change you want to see: developing the leadership culture at Ernst & Young’’, Strategic HR Review, Vol. 8 No. 4, pp. 17-23. Khandekar, A. & Sharma, A. (2005) “Organisational learning in Indian organisations: A strategic HRM perspective,” Journal of Small Business and Enterprise Development, 12(2):211-226. King, L. (1998) “Lloyds TSB – a step in the right direction,” Industrial and Commercial Training, 30(1):30-33. Lee, G. (2003) Leadership Coaching: From Personal Insight to Organisational Performance, CIPD Publishing, London. Pollit, D. (2002) “Management training gives new momentum at Lloyds TSB,” Education + Training, 44(7): 324-325. Pollit, D. (2005) “Testing graduate at Lloyds TSB” Human Resource Management,” 13(1): 12-14. Stenzel, C. & Stenzel, J. (2003) From Cost to Performance Management: A Blueprint for Organisational Development, John Wiley and Sons, New York. Tjepkema, S. (2002) HRD and Learning Organisations in Europe, Routledge, London. Veale, D. J. (1996) "Mentoring and coaching as part of a human resource development strategy: An example at Coca-Cola Foods", Leadership & Organisation Development Journal, 17 (3):16 – 20. Read More