Organisational Design and Development at the Royal Bank of Scotland

Organisational design and development (ODD) is referred to the process and outcome of integration of people, technology and information to shape the structure of an organisation so that it properly aligns with aim and purpose of the business to improve its effectiveness and efficiency. The ODD is important to be considered as it has led the managers of many organisations to identify the changes to be made in any aspects of workflow, procedure, system add structure to make the organisation fit to operate in the market. In this essay, the function of ODD and the way it is related to the culture, history and life of the Royal Bank of Scotland. The organisational learning during ODD and the various restoration and realignment strategies implemented by the Royal Bank of Scotland is to be discussed. Lastly, the importance of global ODD strategy for Royal Bank of Scotland is to be evaluated and critically analysed. If you require HRM dissertation help, feel free to reach out to us!

The primary function of the organisational design and development (ODD) is to improve the effectiveness of the organisation so that it can operate in a progressive and successful way in the industry (Bruce and Baxter, 2019). This is required to increase the profit and revenue of the company and their downfall or failure in the industry can be avoided. The history of the Royal Bank of Scotland (RBS) informs that it has been developed by the investors with the compensations achieved by them from the failure of their previous investment that is the Scottish Darien Company (rbs.com, 2019a). This history of the company made it relevant for the investors to relate the function of ODD in development of the banking organisation. This is because by focusing on the function they can be able to establish a successful business for overcoming their previous losses and achieve better business opportunity to expand their investment on long-term.

The function of the ODD is also to inform ways for establishing healthy relationship within the organisation between the employees and managers to help them in achieving the goals and objectives of the business (Elsbach & Stigliani, 2018). This is relevant for the culture of the RBS as the function informed the management of the bank regarding the way effective relationship between the employees and management are to be established. It is evident as the RBS management following the function offered opportunity to each employee to inform their concern and report misconduct within the organisation so that the management can take actions based on the reports to develop a collaborative work environment in turn boosting the performance of the business. The function of the ODD is to bring value for the organisation to make them understand the way they are to develop their business capability to adapt in the changing social and market situations (Swensen et al. 2016). This is required for the organisation as in the changing environment without improving the business capability would lead them to experience failure in the market as the changing choices of customers cannot be fulfilled. The function is relevant for the culture and life of the RBS as it brought value for its leaders after Brexit to understand the importance in making their move of applying for license in Germany so that they can effectively operate in Europe (investors.rbs.com, 2018).

The function of ODD is to create continuous improvement in the business and its offerings in the industry by making the staffs and management think about the strategies to be implemented for achieving best results for the organisation (Bolden, 2016). The fact is relevant to the culture and life of the RBS as the bank following the function implemented new technologies such as artificial intelligence, internet banking and others to create improvement in their customer services. This is because the current industry environment informs to implement technological services to gain success in the market. It is evident as the RBS is seen to implement Artificial Intelligence to provide reply to the basic bank queries made by the customers so that the services can be offered in faster and improved way (rbs.com, 2019). The function of ODD is to support the leaders who are working for the organisation to understand the change and make their first move to work differently (Winch & Leiringer, 2016). The function is relevant to the history of the Royal Bank of Scotland as they were the first who invented and implemented bank overdraft to handle timely mismatch of funds flow. The first step to introduce bank overdraft helped the RBS reset the skipped cycle of inflow and outflow cash rotation (bbc.co.uk, 2009).

The organisational learning during the ODD process is that it puts undue pressure on the employees and management to change even though resistance to change is natural phenomenon (Rahim, 2017). In the Royal Bank of Scotland, to avoid this issue of undue pressure of change in the ODD process while making changes in the organisational design they thoroughly inform and discusses with the employees and management the reason behind the change. This is done so that employees can understand the value of change and avoid showing unnecessary resistance to adapt to the change in organisational design and development.

The organisational learning achieved from the ODD process is that in case the organisation is landed with employees that have mentality of lower level of achievement then it would be unable to motivate the employees to accept or implement the change or development (Omotayo, 2015). This is because such employees have no desire of getting success and show less interest in receiving achievement at work which makes them show lower contribution in making the change. In the Royal Bank of Scotland, they ensure their employees have mentality of higher level of achievement at work by creating opportunities for career growth and providing remuneration. The remuneration makes the employees with mentality of lower achievement feel boosted to think of achieving higher performance because they are made to perceive that it is the only way in which they can achieve benefits for themselves at work (rbs.com, 2019b).

The ODD process provides the organisational learning that such process is costly in nature and is without guarantee of positive outcome which can only be afforded by the large company (Serrat, 2017). In order to avoid the problem, the Royal Bank of Scotland executes through research about the potential outcome of the probable organisational development planned according to the change in the market. Moreover, before making any organisational development the RBS consults with its employees to ensure they reviews and provides feedback regarding the parts to be changed in the plan so that positive outcome can be achieved through organisational development.

The ODD process provides the organisational learning that effective focus has to be on the communication channel and in presence of an infective interaction between employees and management the process cannot be successful (Frese & Keith, 2015). In the RBS, it is seen that they have adopted a listening approach in their work culture within the organisation. Moreover, they are seen to use various communication channels to allow its employees to create clear interaction with the management (rbs.com, 2019). These facilities of communication have become effective for RBS to avoid the problem of implementing ODD as the clear communication helps in communicating goals related to the process to the employees to make them act accordingly for successfully making the change or development in organisational design.

The Royal Bank of Scotland (RBS) is using different organisational restructuring and realignment strategies to improve their business operation one of which is aligning the organisational activities according to market preferences. This is evident as the RBS previously informed in 2010 that they are not going to shut down ant branches when they are the only performing bank in the town. However, they restructured the decision according to the prevailing situation in the market due to which in 2014 they closed 44 bank branches because the transaction from those branches has fallen below 30% for the past four years (investors.rbs.com, 2018). This is required to avoid unnecessary financial loss in the business operation of the retail banking institution. Moreover, in 2017, the RBS reported that they are going to close down 259 branches across Britain as more customers have shifted to online banking more than visiting the bank physically (investors.rbs.com, 2018). This is an effective restructuring strategy for the RBS as they have changed their way of business in different form according to the market condition and preferences. The business requires restructuring themselves according to the changing market conditions so that the services and products for the customers are effectively provided according to their needs and demands as well as the organisation have to carry fewer expenses in operating their business (Carayannis, Sindakis & Walter, 2015).

The other restructuring strategy used by the RBS is that they have cut down the complexity in providing banking services to its customers and made innovation in their services to offer better experience. This is required as complex organisational structure or design leads the company carry added cost and responsibility and the innovation in services helps to improve the customer experiences making them stay with the organisation (Meyer & Peng, 2016). It is evident as the RBS before implementing artificial intelligence to resolve queries related to banking services they have to face increased queue of customers for making simple queries regarding banking transactions (investors.rbs.com, 2018). In 2018, the RBS implemented an advanced fraud profiling system to protect its customers from credit card frauds. In the process, they offered more control to its customers to personally lock the credit card in case any unauthorised payment has been made on temporary basis rather than going through the long waiting and complex process involving the customer services of the bank (investors.rbs.com, 2018).

The Royal Bank of Scotland (RBS) is using the focus on establishing better activity as one of the restructuring strategy for the organisation to achieve success in the industry. The removal of any inefficient activities which is able to hamper the organisational restructuring process is to be removed so that the chances of failure or issues can be reduced (rbs.com, 2019). The RBS is seen to have used the power of the technology to realign their credit card services to provide improved experiences to its customers. This is evident as they have realigned and improved their banking application by participating with Travel Market services where they have provided opportunity for their customers to use credit card effectively for their travelling plans by reducing likelihood of the card being blocked by the credit card fraud team. Moreover, the application has been improved so that the customers of RBS are able to keep track record of their credit card spending and easily request any decrease or increase in limit (investors.rbs.com, 2018).

The Royal Bank of Scotland (RBS) has been seen to reshape their banking activities to properly align themselves with the guidelines mentioned in the UK ring-fencing legislation (investors.rbs.com, 2018). This realignment strategy of reshaping the organisation to meet legislation guidelines is vital in business so that the organisation do not face legal issues due to violation of any legislation (Ogbari et al. 2016). In the study of Harmon, Kim & Mayer (2015), business which executes violation of laws makes a negative image in the market. This result the consumers to avoid availing services or products from them as they develop trust issues over them. The realignment strategy to reshape the RBS structure in meeting the UK ring-fencing legislation involved transferring 4.5 million customers between various legal entities. This is done so that the RBS can legally separate their important banking services from the rest of the group. In the process, they also introduced certain changes in the way of operation of their Board so that the bank can comply with the regulatory requirements mentioned in the legislation (investors.rbs.com, 2018).

The RBS is using a restructuring strategy for employee management to improve workplace diversity and inclusion. This is essential because maintaining a diverse and inclusive working environment leads the organisation to show they avoid discrimination within the workplace and provides equal opportunity for all employees to work effectively. An organisation with diverse and inclusive work environment is able to attract better talents in the market as the employees feel valued and high self-esteem to work for them (Lauring & Klitmøller, 2017). The RBS’s restructuring strategy to improve workplace inclusive and diversity involves ensuring 30% of the roles in the three senior-most positions in the organisation are fulfilled by women within 2020. Moreover, to fulfil the strategy the bank has planned to improve non-white employees in the top leadership layers of the organisation (investors.rbs.com, 2018). This is done with the intention to ensure women empowerment and gender equality which are one of the essential social issues at the present in the industry.

The Royal Bank of Scotland (RBS) is using reshaping strategy where they are reducing cash management operations outside Ireland and Britain. This is done with the intention to become British-focussed retail and corporate leader (nytimes.com, 2015). The strategy is effective in nature because it would lead RBS to be more sustainable and stronger bank in Britain as they do not have to think and worry about performances in global markets helping them to concentrate on improving their business in the country where nearly 80% of the shares of the bank are owned by the government of Britain. One of the RBS’s reshaping strategies is that they are going to carve out the risky assets of the bank and led them to be taken by the state ownership to reshape them as a potential banker (ft.com, 2013). This is evident as removing the risky assets of the bank would lead the management to avoid getting distracted by worrying about the way to remove the risk which in turn would lead the management to focus on the core aspect of the business as well as increase the lending activity by the bank.

The global ODD strategy of an organisation is important as it ensures its continuous improvement in business within the global industry. This is because through the global strategy the organisation is able to meet vital global policies and procedures related to the business making them face ease to execute their business activities with the wider market to achieve greater business improvement and productivity (Corfield & Paton, 2016). In reference to the demographic trends, the global condition indicates that the baking institutions are to be more informed about their practices to the customers as an increased trend of informed buyers and customers have been seen (Fox, Glosten & Rauterberg, 2017). In relation to this, the Royal Bank of Scotland (RBS) has developed the global ODD strategy to include artificial intelligence, phone messaging system, email and other technological advanced communication channels within their organisation to interact and respond to the queries of the customers regarding their services in detail (rbs.com, 2019). The strategy is beneficial for the RBS as it would lead its new and existing global customers be effectively informed regarding the advantages and reason of availing the services from the bank in comparison to other institutions without facing any geographic barriers.

The study of Rana, Bansal & Gupta (2015) mentions the importance of global ODD strategy is that it helps the organisation to identify differences in design and development of the organisation to be made so that they meet the rules and regulation related with companies in the specific country of their business operation. This is effective for the organisation to avoid uncertain and improper legal actions against them. In relation to the Royal Bank of Scotland (RBS), the global ODD strategy is important for them to develop and design their organisation in such a way that they meet the current legislation in the country of operation and be in an advantageous position in the present market situation in comparison to other competitors in the industry of their business operation. In contrast, the study of Gereffi (2015) informs that lack of global ODD strategy leads the organisation to face hindrance in operating their business internationally in a proper manner as they cannot effectively adapt with the changing industry circumstances in the country of their business operation. Thus, in relation to the Royal Bank of Scotland (RBS), the global ODD strategy is important for them to develop and design their organisation in such a way that they meet the current legislation in the country of operation and be in an advantageous position in the present market situation in comparison to other competitors in the industry of their business operation.

The global ODD strategy is important as it helps to design the human resource department in such a way that diverse and inclusive work environment is established where employees of different cultural origin and from different countries are allowed working together. This is essential for the organisation as it helps them recruit potential local employees from the countries of their business operation to involve them to work for the company (Kirk, 2016). It is effective for the growth of the Royal Bank of Scotland as the strategy allows recruitment of local employees for the organisation who are able to inform them regarding the way they are to manage their business in the country to achieve success. As argued by Patel et al. (2019), the lack of effective global ODD strategy leads the international organisation face hindrance to implement ways of operating differently according to change in location of their business. This leads the business to face hindrance in human resource management making them experience issues with worldwide operation.

The above discussion informs that function of ODD is to ensure increase the organisational effectiveness in the market so that they can progress properly. Moreover, the function includes establishment of effective relationship between employees and management. The fact is relevant to the history and culture of Royal Bank of Scotland as following the functions of ODD has helped them in developing a healthy culture and effectively progressing organisation in the market. The organisational realignment strategy used by the RBS includes reshaping organisation according to UK ring-fence regulation, improving HR to increase diversity and inclusiveness and others. The global ODD strategy is important for the RBS to help them execute their business practices and HRD management in an effective way.

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