Western and Pacific Bank - Framework of Success - Case Study Example

Case Study of Westpac bank Name Institution Course Instructor Date Case Study of Westpac bank Introduction Westpac; a name derived by merging two words, Western and Pacific, represents one of the successful banks in Australia. The bank’s headquarters are located in the heart of Sidney. In Australia, it is ranked among the four largest and customer-satisfactory banks; however, in New Zealand it takes the second spot according to the 2014 Pacific business survey report. Additionally, in terms of assets the bank takes the first spot in Australia with more than 1200 branches and over 2900 ATM machines countrywide (Keating, et al., 2008). 2011 statistics reveal that Westpac bank serves more than 12 million banking customers. Research findings reveal that the success of Westpac bank is based on effective and efficient strategic planning performed by the bank’s highly qualified management staff (Welter and Smallbone, 2011). This paper seeks to present a case study of Westpac bank and establish the bank’s framework of success. Contextual discussion Importance of understanding behaviour in selecting new staff Westpac’s managerial approach to selecting new staff reflects an understanding of individual behaviour; moreover, it is the main strategic reason behind the bank’s tremendous success (Cuganesan, 2006). The credibility of this statement lies in the behavioural theory of management which suggests that if managers understand the behaviour of the business workforce, they can easily motivate the employees to achieve the business’ set goals (DeRue, et al., 2011). It is because; when the management shows interest in the well-being of the employees, the employees feel appreciated and accepted as being part of the business family. The objectives of the business become part of their responsibility which prompts them to work hard to fulfil their part (Welter and Smallbone, 2011). Using this approach the management is able to understand the weaknesses and strengths of every individual employee and by doing so, they are able capitalize on the employees’ strengths to overshadow their weaknesses (Ho and Wu, 2006). This practically leads to the exploitation of the employees’ full potential and capability which directly promotes business success. The Westpac management understood the principles of the behavioural management theory and applied them effectively and efficiently to suit its objectives (Freeman, 2010). For instance, basing on the aspect of behaviour (the form of conduct between one person to another), the theory suggests that if employees are treated like human beings as opposed to automatic machines, they respond in a positive manner (DeRue, et al., 2011). Given that it is work environment, the employees tend to focus on the well-being of the company. This means that the employees tend to focus on their work by dedicating their entire knowledge, abilities, experience and time to ensure that they succeed in every task (Assink, 2006). In this regard, they influence high productivity in that particular business organization. The same case applies to Westpac bank, whereby, the management staff of the bank understood that many business organizations did not appreciate mature-age employees (Keating, et al., 2008). In fact, they discriminated them based on the false beliefs that mature-age employees were slow in the execution of their tasks, adamant to learn new skills and technology, hard to supervise, and generally unproductive because they are always looking forward to retirement rather than performance at work. Based on the research conducted by both Australian and International researchers, the Westpac management staff finally understood that the mature-age workers had a lot of potential benefits which other organizations did not understand (Ho and Wu, 2006). The research finding established that mature-age employees were equal to or even better than the young workers. In the same context, the mature-age workers were shown to have more experience and skills, low rate of absenteeism, desirable work ethics, low rate of job turnover, quality work performance and above all they were loyal (DeRue, et al., 2011). The bank understood that by combining these attributes it would be in a better position to increase its productivity, meet the desires of the customers and finally accomplish its goals. However, despite all these attributes, many organizations failed to understand that the mature-age employees were not concerned about the salary or retirement benefits, but all they needed was an understanding. This is based on the claims cited by mature-age workers in the research findings that they were not willing to work in many organizations due to age discrimination (Garvin, 2012). That is why the mature-age employees were not even concerned about advancing their studies and skills. Therefore, understanding the potential of the mature-age workers marked the initial step of the bank towards achieving its goals. Drawing evidence from the behavioural management theory, the bank had finally understood the nature of the mature-age workers and what the workers actually wanted from any organization willing to hire them (Freeman, 2010). The second step taken by Westpac after understanding not only the behaviour of the mature-age workers, but also their potential benefit to the bank was to motivate them so as to fit the marketing strategy of the bank (Freeman, 2010). In this regard, motivation became the second initiative that the bank had to undertake. According to the behavioural management theory, motivation refers to the act of directing behavioural endurance in individuals. To Westpac, motivation did not involve financial benefits based on the understanding of the concerns of mature-age workers. According to Cartwright and Holmes (2006), motivation involved various aspects such as empowerment, social status and autonomy, self-fulfilment and co-worker interrelationships. The bank understood these aspects and incorporated them in the workplace. Whereby, the bank’s management made a decision to educate the all its branch managers on the benefits of hiring mature-age workers (Garvin, 2012). Thereafter, it drafted and implemented a policy to ensure that over the period of the next two years it would retain mature-age employees and hire another 800. This was not a bare act of corporate responsibility to the mature-age Australian society, but also a strategic plan to exploit the potential of mature-age workers and match the age bracket of the bank workers with that of the bank customers. It further guaranteed the well-being of the mature-age workers by forming a unit within the organization to quell stereotypic behaviours directed towards them (Chan and Ahmed, 2006a; Chan, 2006). These initiatives motivated the employees of the bank (both old and young) to work hard thereby increasing productivity and performance of the bank. Basing on the above described evidence, it is true that Westpac’s managerial approach to selecting new staff reflected an understanding of individual behaviour. Benefits of workforce diversity There are various benefits that an organization can gain by hiring a more diverse workforce based on the Westpac’s experience. Hiring a diverse workforce is more than just fulfilling the legal mandate of a given country or showing good faith (corporate responsibility) (Chan, 2006). At a glance, some of the notable benefits according to recent research findings include creation of good customer connections, motivation of employees, employment and retention of quality workforce, and encouragement of employee innovation among other benefits. Drawing an example from the Westpac diversity employment scheme, the bank employed its workforce regardless of the age limit as a marketing strategy (Keating, et al., 2008). In fact, it emphasized on employing mature-age workers more than the young workers. It is mainly because; the bank knew that employing mature-age workers matched perfectly with its marketing strategy. This means that the research department of the bank had established that the bank’s main customers were aged above 45 years of age and the trend could continue several years to come (Freeman, 2010). By employing more mature-age workers, the bank was met the desires of its customers who were mostly mature. This shows that the bank did not only employ mature-age workers to increase workforce diversity, but as a marketing strategy to meet the customer’s desires and establish reliable relationships between the employees and the bank’s customer. Also, the age diversity promoted balance between the young, skilled enthusiastic employees and the mature older workers (Chan and Ahmed, 2006b). The Westpac bank did not only invest in age diversity, but also invested in skills, genders, abilities and ethnical diversity, among other diversities. In this regard, about 52% of the bank’s workforce represented different cultural and ethnical backgrounds other than Australian. It also recorded a 3% employment of people with disabilities coupled with 43% of women managers (French and Strachan, 2007). This is enough evidence to show that Westpac realized the benefits of investing in workforce diversity. To support this argument, the bank’s management revealed in its philosophy that the bank is committed to become a global leader in corporate responsibility and workforce diversity. However, the bank stands to gain long-term sustainability benefits other than exploiting diversity as a marketing strategy, meeting Australian legal requirements of employment and as a way of meeting corporate responsibility (Chan, 2006). Basing on Westpac’s diversity experience coupled with recent research on workforce, there are three major bottom-line benefits that any business can gain from workforce diversity. They include establishment of reliable and effective problem solving approaches, establishment of sustainable employee relationships and establishment of better insights on the organization’s customers (Chan and Ahmed, 2006a). Initially, in establishing reliable and effective problem solving approaches, the diverse workforce brings different skills and experiences in the business that inhibits groupthink and instead provides a serene environment to deal with problems arising within and without the company (Freeman, 2010). Diversity exposes the business to various aspects of the society such as age, gender, race and ethnicity, among other aspects. The exposure to these aspects provide deeper insights and understanding of a particular aspect in an organization allowing the management to deal with misunderstandings arising from the company or even outside the company such as ethnical differences, gender manipulations, racism and stereotypic behaviours among other issues (French and Strachan, 2007). Additionally, the business organization benefits from diversity by establishing sustainable employee relationships. In this regard, incorporation of workforce diversity in the business portrays that the organization values every employee regardless of the age, gender, ability, race and ethnicity (Roberge and van Dick, 2010). These attitudes improve the employees’ outlook on the prospects of the company. Whereby, when employees feel that they are part of the business organization that values every aspect of humanity, they are inclined to work hard to ensure that the business achieves its objectives or goals. When this transformation is analyzed on a wider scope, it appears that diversity initiates employee motivation which consequently influences work dedication, productivity, innovation, hardwork and desirable performance (Pitts and Wise, 2010). Finally, diversity in the workforce influences the establishment of better insights on the business’ customers. The realization of this particular benefit goes hand in hand with the state of globalization. Due to advancement in technology, business organization nowadays deals with diverse customers around the world via the internet (website portals) and world business expos (Pitts and Wise, 2010). To deal with customer diversity, business organizations have to employee a diverse workforce. The diverse workforce increases the flexibility of the business in handling customers from different parts of the world effectively and satisfactorily. Moreover, a diverse workforce attracts a diverse customer base, because customers want to identify themselves with a business organization that meets their preferences (Freeman, 2010). Drawing evidence from the bottom-line benefits, it is important to conclude that workforce diversity plays an important role in any business organization (Roberge and van Dick, 2010). This literally means that any business that invests in workforce diversity is ‘absolutely killing two birds with one stone.’ Whereby, the business fulfils the corporate and legal responsibility and at the same time capitalizes on workforce diversity as a business marketing strategy. Importance of challenging perceptions and attitudes Westpac stood to gain a lot by challenging the attitudes and perceptions of branch managers and senior executives responsible for selection and promotion decisions. This means that without challenging the negative attitudes and perceptions coupled with stereotypic behaviours, the company could not have achieved the set goals within the five year span (Garvin, 2012). Therefore, this section assesses the significance of dealing with negative attitudes and perception in a business environment based on recent research finding and with reference to Westpac’s experience. Research findings reveal that the attitudes have a profound influence on every individual in a business organization (Heaney, 2007). The influence ranges from employees to the management staff of the given business organization. Attitudes tend to define the kind of working environment in an organization which consequently determines the workers’ productivity, abilities and morale. Studies show that the key to creating a harmonious working environment is to first understand the attitudes and perceptions of the employees (Harrison, Newman and Roth, 2006). With reference to Westpac’s strategy, the organization realized that other business organizations had a negative perception about the mature-age workers. The negative perception was based on false allegations that the mature-age workers are slow, unproductive, adamant to learn new skills and hard to supervise (Freeman, 2010). Based on this evidence, the bank knew that most of the organization’s young employees including the youthful branch managers had the same negative perception. Research reveals that negative perception always create negative attitudes (Choi, 2007). That is why Westpac’s management recognized the need to challenge the negative perception and attitudes of branch managers and young employees towards the mature-age employees. The management took this initiative to ensure that, first, every employee would be ready to welcome and work alongside the mature-age workers. Second, every branch manager was aware of the benefits of recruiting more mature-age workers. Finally, the mature-age selection process would be conducted fairly without discriminations (Choi, 2007). The bank’s management took this initiative based on the research evidence that there were more benefits in employing mature-age workers than young workers. These benefits include high experience, good quality of work, organizational loyalty, desirable work ethics, lower employee turnover and absenteeism. Moreover, the mature-age workers fitted the company’s strategy of fulfilling the customer’s desires (Assink, 2006). This means that the bank’s customer bracket consisted of mainly mature individuals. Based on the bank’s research it is easier for the mature people to deal with each other than the opposite (mature versus young). On a wider scope, dealing with workplace attitudes in any business organization leads to validation, creativity and retention. Validation occurs in a business environment based on the prevailing attitudes (Cohen, et al., 2007). For example, if the prevailing attitude in a business organization is negative in nature, the business’ poor performance is received as a usual event rather than as a matter that requires urgent resolution. However, if the prevailing attitude is positive in nature and the business performs poorly than expected, the management recognizes that there is something wrong with the internal framework of the business which needs to be resolved. In the words of Nerur, Mahapatra and Mangalaraj (2005), that is why Westpac challenged the branch managers’ perception to create a positive attitude in the working environment to resolve the stereotypic belief about the performance of mature-age workers. Research shows that creativity is established in a business environment that nurtures positive attitudes (Heaney, 2007). Creativity influences creation of new ideas and resolution of diverse problems within the business organization. In a positive creative environment, employees feel that they are part of the business organization that is why they contribute new ideas that lead to the success of the business. In a negative creative environment, employees feel that their ideas do not matter to the business’ success that why they do not present any new ideas to the management (Freeman, 2010). The same applies to the Westpac bank, whereby, the management challenged the negative perception on mature-age workers to create a positive creative environment within the organization. Alternatively, attitudes play an important part in the retention of employees. A negative working environment is characterized by high rate of absenteeism, high rate of employee turnover and high rate of job resignation (Cohen, et al., 2007). In the process, the organization periodically looses experienced and qualified labour which leads to the poor performance and ultimate failure of the business. On the other hand, a positive working environment tends to retain highly skilled and experienced labour. It is based on the fact that, the employees regard a positive environment as a place suitable for them to exploit their potentials. That is why Westpac management challenged the negative perception. The main aim of the bank was to create a positive working environment for retention of the mature-age workers (Cuganesan, 2006). Conclusion In conclusion, the paper presented a case study of Westpac bank and established the bank’s framework of success. In the contextual discussion, the paper analyzed three main issues which include the importance of understanding behaviour in staff selection, the benefits of workforce diversity in a business organization and the significance of challenging or dealing with negative attitudes in the business working environment. The three issues were discussed with reference to Westpac bank and contextualized based on the current research findings. In conclusion, the discussion revealed Westpac’s key to success. Bibliography Assink, M. 2006. Inhibitors of disruptive innovation capability: a conceptual model. European Journal of Innovation Management, 9(2), pp.215-233. Cartwright, S. and Holmes, N. 2006. The meaning of work: The challenge of regaining employee engagement and reducing cynicism. Human Resource Management Review, 16(2), pp.199-208. Chan, A.M. 2006. Tapping the multicultural market in Australia. Marketing and multicultural diversity, pp.238-252. Chan, A.M. and Ahmed, F. 2006a. Ethnic Marketing in Australia. International Review of Business Research Papers, 2(4), pp.10-21. Chan, A.M. and Ahmed, F. 2006b. The use of secondary data in unveiling the potential of ethnic markets. Contemporary Management Research, 2(1), pp.31-42. Choi, J.N. 2007. Change‐oriented organizational citizenship behavior: effects of work environment characteristics and intervening psychological processes. Journal of Organizational Behavior, 28(4), pp.467-484. Cohen, D., Gan, C., Yong, H.H.A. and Chong, E. 2007. Customer retention by banks in New Zealand. Banks and Bank Systems, 2(1), pp.40-55. Cuganesan, S. 2006. Reporting organisational performance in managing human resources: Intellectual capital or stakeholder perspectives?. Journal of Human Resource Costing & Accounting, 10(3), pp.164-188. DeRue, D.S., Nahrgang, J.D., Wellman, N.E.D. and Humphrey, S.E. 2011. Trait and behavioral theories of leadership: An integration and meta‐analytic test of their relative validity. Personnel Psychology, 64(1), pp.7-52. Freeman, R.E. 2010. Strategic management: A stakeholder approach. New York, NY: Cambridge University Press. French, E. and Strachan, G. 2007. Equal opportunity outcomes for women in the finance industry in Australia: Evaluating the merit of EEO plans. Asia Pacific Journal of Human Resources, 45(3), pp.314-332. Garvin, D.A. 2012. The processes of organization and management. Sloan management review, 39, pp.1-5. Harrison, D.A., Newman, D.A. and Roth, P.L. 2006. How important are job attitudes? Meta-analytic comparisons of integrative behavioral outcomes and time sequences. Academy of Management Journal, 49(2), pp.305-325. Heaney, J.G. 2007. Generations X and Y's internet banking usage in Australia. Journal of Financial Services Marketing, 11(3), pp.196-210. Ho, C.T. and Wu, Y.S. 2006. Benchmarking performance indicators for banks. Benchmarking: An International Journal, 13(1), pp.147-159. Keating, B., Quazi, A., Kriz, A. and Coltman, T. 2008. In pursuit of a sustainable supply chain: insights from Westpac Banking Corporation. Supply Chain Management: An International Journal, 13(3), pp.175-179. Nerur, S., Mahapatra, R. and Mangalaraj, G. 2005. Challenges of migrating to agile methodologies. Communications of the ACM, 48(5), pp.72-78. Pitts, D.W. and Wise, L.R. 2010. Workforce diversity in the new millennium: Prospects for research. Review of Public Personnel Administration, 30(1), pp.44-69. Roberge, M.E. and van Dick, R. 2010. Recognizing the benefits of diversity: When and how does diversity increase group performance?. Human Resource Management Review, 20(4), pp.295-308. Welter, F. and Smallbone, D. 2011. Institutional perspectives on entrepreneurial behavior in challenging environments. Journal of Small Business Management, 49(1), pp.107-125. Read More