This assessment will cover -
- Elaborate different organisation strategy for AEGON.
- Give the external and internal areas for employment relationship.
- Give appropriate measures which are being undertaken in order to manage the external drivers.
- What are the effective barriers for change in AEGON.
Change management is a collective term for all approaches to prepare and support individual, teams and organizations in making organizational change. With the changing needs and demand of customers, organizations need to adapt these changes in order to sustain in this competitive market. To better understand this leading change, AEGON company of Edinburgh UK is being selected. AEGON is a pension, insurance and investment company. The change creates an impact on an organization’s strategy and operations which is being discussed in this report. There are change drivers which have influences on organizational behavior which is being explained in this report. The change barriers create impact in the decision of leaders is also discussed in this project. The leadership approaches are very helpful in dealing with change, which is being explained in this report.
P1 Comparison of ways where there has been an impact of change on organization strategy and operations.
The organizations have to change as part of keeping up with the competition or adjusting new market trends or technologies. The things like merger, restructuring, technological advancements, process enhancements, changing customer demand and new product lines are common change in today’s business environment. As in this given case, AEGON has also made some changes to be sustainable in market. Though AEGON is big name but company is still struggling in the market, the reason behind this is people are not aware about company. Because company have traded under number of brand name so it is difficult for the customers to recognize brand. So for that company has made change in organization which worked well for the organization. To better understand this concept comparison between AEGON and AVIVA has been drawn below:
AEGON and AVIVA both the companies deal in same industry and with same target market. But both the companies use different strategy in order to attract their customers. The change management has huge impact on strategy and operation of both companies (Suchman and Williamson, 2011).
Drivers of change
The change is occurred in organization due to various reason. There are different drivers of change like technology, customers, government, capabilities, resources, invention, dissatisfaction and desires. These are drivers of change which can have major impact on
Strategy used by AEGON
The business strategy is directly related with business and has direct impact on customers. But it is highly influenced by change management of organization. It includes the factors like which customer segment will be targeted and which geographic area will be cover. Change have direct impact on all this factors as AEGON is now come up with new brand name so company have to make their strategy accordingly.
Strategy used by AVIVA
Operational strategy is used by AVIVA to grab more market share. This is related with resources of organization whether its financial or non-financial. This mainly focus on which capability needs to enhanced and should new technology be adopting or not. For example, company is planning to adopt new technology but due to change now they will focus more on their process rather than adopting new technology. So change has made impact on planning of organization.
Apart from this change affect operation like sales and marketing of organization. As AEGON has planned to market their product as they used to do but now due to change they will have to use new brand name in their advertisement to create awareness among the customers. This is how change create impact on the operation and different strategy of business.
AEGON has launched the first global AEGON awards which specifically helpful in celebrating overall attainment of organization. It is sharing excellence with the overall participation from almost 20 nation units and other 90 applications. Best engagement, empower initiative and customer centric team. They used to measure the requirement that can follow up on the results of the research outcomes.
D1 various mechanism for maintaining the employment relationship
This is very important to manage and maintain healthy relationship with employees. The strong employees’ relations are necessary for high productivity and achieving maximum profits. The strong employees’ relations are very beneficial for both employees and organization as well. A good employee relation signifies that employees should feel positive about their identity. There are some ways which is being used by AEGON to maintain faithful relationship to its employees. These are as follows:
- Focus on the effective leadership on advocating latest innovation, accountability and reliable customer centricity.
- Attract and develop the best people to committed to their basic objective that are planned by the company during the period of time.
- With the growth and increase in digital capabilities so that chances of growth can be increase up to a definite level (Sinelnikov and Kerper, 2015).
P2 Internal and external drivers for change
Change in organization plan, policies and strategy is a continuous process as change allows an organization to be innovative and take competitive advantage. This change process in an organization directly affects decision of leaders and managers. Globalization and continuous innovation in technology resulting in constantly evolving business environment. There are some drivers of change due to that change occurs. As the drivers for change in AEGON is being discussed below:
Internal drivers are those which are related with internal structure of company. These drivers effect leadership, team and organization performance directly. The internal drivers of change in AEGON are discussed below:
The capabilities are capacity and skills of an organization and its employees. it can be a major driver of change in company. The company should be capable enough to fulfill customer needs and demands and grab more market share. AEGON is lacking at its capabilities so they would not be able to meet customer requirement and they have make changes in their capacity in order to satisfy customers. It can affect the performance of individual, team and organizational performance as the organization has set up its strategy according to their present capabilities (Murray, 2011).
The resources can be key driver for change in organization. Resource are those which used by companies for fulfilling customer needs and demands. The company should have enough resources for creating and delivering better products and services to customers. Resources can be financial and non-financial. As AEGON does not have enough resources so leaders would not be able to take better decisions in company and individuals and team would not be able to perform. For example: As AEGON does not have skillful employees who possess convincing power, so company cannot earn more profit. As it is important to have convincing skill in order to sell insurance. So this can affect the behavior and working of individual and teams.
Innovation is key to success in this competitive environment as it can affect the decision of leaders and performance of team, individual and organization as whole. For example: If competitors of AEGON come up with some innovative plan and policies than leaders have to change their current plan and employees have to perform accordingly.
External drivers of change are those which is not related with the internal component of an organization. These are having direct effect on the performances of leaders as well as their teams and employees of organization. The AEGON company is being affected by these external drivers. Some of them are mentioned below
Customers are king of market and they direct affect the overall organization performance. Every company is working to meet customers’ requirement and want to gain more market share in order to maximize their profits. As if customers taste and preferences changes than AEGON has to bring those products which fulfill customer requirement. As non fulfillment of customer requirement will affect behavior of individual, leaders and team.
Government directly affects the organization plan, policies and regulations. As government is a major driver of change within an organization. For example, if government of country makes changes in their policy related with the insurance then AEGON has to change its policy and have compile with government rules and regulations. Thus, individuals, teams and leaders would have to perform according to the latest policy formed by the legal bodies (Miller and Rollnick, 2012).
Competitors are those which enable the business to bring innovation in the organizations. competitors can affect the performance of employees and teams of organization by coming up with new products which can attract more towards customers. The innovation in the product and service of competitors will affect the performance of AEGON.
These are external and internal drivers of change which affects performance of employees, teams of AEGON’s.
P3. Measures that can be taken to minimize the negative impact of change
Organizational behavior is the study of attitude of group of people in an organization. As change is an important element that enables an organization to gain more revenues altogether it can have negative impact on the organizational behavior. Thus, to minimize these negative impacts there are some prevention measures which is being taken by AEGON. These are discussed below:
Define clear goal and align with objective:
The goal of company should be very clear. It is very important to have a clear objective this helps in formulating change process according to that objective. The change should be taken place in organization with a proper objective. Hence, these changes can be aligned with the organizational goals effectively. AEGON have proper targets in order to apply change model and reduce negative impact from that model from organizational behavior.
Proper training to employees:
As, it is very important to provide proper training to the employees so that they can cope up with change and can adopt the changes effectively. AEGON has implement technological change in company so it is very crucial to provide training to their employees regarding that product. This will help employees to adopt the technological change easily and perform their task effectively.
Communicate to organization:
Communication is an important tool which will help organization to minimize negative impact of change. As, AEGON have communicated throughout the organization about what changes has been taken place in organization. The manager can communicate via presentation, e-mails and by get together of employees etc. (Lawrence, 2014).
Implement change model effectively:
It includes managing transition of change effectively. This will be helpful for an organization to draw a plan, allocate resources and appoint key person to head change process in organization. The leaders of AEGON tried to bring enthusiasm in employees for the change by sharing their vision and mission of company. As the model of change should be implemented in a very effective manner so that all the mistakes and errors can be modified properly. This will help further to minimize negative impact and create positive impact of change process in organization.
The change model should be well planned by organization. A well planned change model will be very helpful in creating a positive impact on organization and reduce negative impact of change. The AEGON is planning about where to make change in organization like, change in structure, change in technology and change in people. It is pre decided by company and to implement change model. This will be helpful in dealing with any unpredictable chaos situation due to this change in the organizational behavior.
These are the techniques which is being used by the AEGON to minimize negative effect of change.
M2. Appropriate theory and model to critically evaluate organizational response
The change is important process which needs to be adopted by every organization in order to be sustain in competitive market. There are different models of change which is being used by the AEGON. These are discussed below:
John Kotter’s, Process for leading change
- Make a sense of urgency
- Build a guiding coalition
- Form a strategic vision and initiatives
- Enlist a volunteer army
- Enable action by removing barrier
- Generate short term wins
- Sustain acceleration
- Institute change
There are different change driver like technology, customers, investors, desires and they can have positive or adverse impact on the organization (Rainer, 2016).
P4. Different barriers to change
Change does not take place very easily in organization as there are some barriers which can affect the change process. This is very important for AEGON to identified below barriers and fix these so that change can take place easily in the organization. There are some barriers which can affect the leaders’ decision are discussed below:
Lack of management support:
Management support is very important in respect to change management. This is considered as a measure barrier for organization as it is difficult for the employees and other staff of organization to adapt change easily, so they do not support management for making change in organization. As this lack of support from employees and other staff of management can directly affect decision of change in organization. In this kind of situation big companies like AEGON should encourage the employees in order to accept change and work accordingly so that goals can be achieved.
Lack of communication:
The ineffective communication regarding the change in organization can lead to bad effect on overall organization as well as on decisions of leaders in the company like AEGON. This is very important to make effective communication in order to create awareness about the change which is being going to take place within an organization. Thus, AEGON is properly communicating throughout organization regarding the change. Communication will make easier for the employees to support management in change and adopt change to achieve organization goal (Kowch, 2013).
Lack of commitment to change:
Commitment is very important to achieve definitive goals. Employees and other staff of organization do not show the commitment towards accepting the change so it can be considered as a major barrier for organization. The lack of commitment from top management will also demotivate the employees towards the change. The AEGON has tried to fulfill enthusiasm in their employees so that goals can be accomplished. As due to lack of commitment to change, it will affect decision of leaders as they have already taken decision regarding the change.
To apply change in the company, it is very important to have adequate amount of resources so that change can be applied in the organization effectively. The resource includes financial and non-financial resources. The enough amount of financial and non-financial resource availability enables the organization to apply change without any barrier. As scarcity of resources could be a major barrier for applying change in the organization. The leaders should take decisions according to the availability of resources. Thus, it will not have much effect on decision of leaders. To implement change in AEGON, company must have enough amounts of financial resources and human resource also so continuously monitor of the change can be done.
Reliable on past glory:
This is very important to understand that change it is an essential process in today’s dynamic environment for sustaining in the market. Most of the companies would rely on their old organization process and they afraid to adopt change in the organization. This is a major barrier for companies that they want to rely on their old system which they are using from last number of years. This can affect the decision of those leaders who wants to bring change in company. For example, in 1970, US automobile sector could not understood the importance of small fuel efficient cars as resultant the Japanese invasion covers half of US market by their small fuel efficient cars. As, it can be seen from above case also that AEGON was relying on their old culture which resultant them as huge loss. After than they applied change in organization and sustain in increasing competition in market (Heifetz and Linsky, 2017).
There are various ways in order to overcome the barriers which are used by AEGON in order to smooth functioning of organization. These ways are such as leading staff through change, proper and adequate communication with stakeholders regarding change in organization and by understanding need and impact of change. Apart from this company should involve their employees in change process so they can give their best effort towards change.
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M3. Force field analysis
Change is very hard to accept for the people. This analysis must provide the framework for looking at the factors that can affect situation of organization. This is a method in which a team or an organization can predict in advance about what the expected resistance will be proposed change in the coming period of time. There is a process for change which is being given in this analysis. The process is discussed below:
- Describe proposal of change
- Identify force for change
- Identify those which are against change
- Assign scores
- Analyze and apply
The AEGON has implemented this process in organization in order to achieve goals of company effectively.
P5. Different leadership style
Leadership is an area which comprises of both practical skill and ability to lead of an individual in organization as well as outside organization. Leaders guide and motivate its subordinates to perform better and get their goals achieved. As leaders plays a very crucial rule while organization make change in their company. The leaders are one who can encourage and influence their subordinates in company to adopt change and work hard so that company goals can be achieved (Hallinger, 2011). To perform their task in company effectively they use different leadership approaches which enable them to deal with change which occurs in company. Analyzing knowledge about the leadership competencies, leader’s strength and weakness and change attitude will lead to determining pragmatic strategies to applied through change process. Therefore, leaders have to be aware about where changes can be made in organization so according to that they can apply the leadership approach. The approaches which is being used by leaders of AEGON are discussed below:
This is a part of leadership style which mainly focuses on the supervision, guidance and performance. This is an integral part of full range of leadership. Under this kind of leadership style leaders tends to promote compliance by subordinated through both reward and punishment (Byers, 2017). The leaders give reward to their subordinates who do their best performance as well as punish who does not perform better. This approach is being used by leaders of AEGON while they make change in organization. This help them to keep motivated their employees and get work done through them. This kind of leadership style maintains stability among employees and provides clear guidelines and roles to their subordinates so that they can perform better. The different characteristics of this leadership style are discussed below:
Clarity of goals:
The transactional leadership style clearly define goals and role to their subordinate so that they can work effectively under the situation of change. The leaders of AEGON are also using this approach to motivate their employees to work with best interest of organization.
Creativity and innovations:
Innovation is very important element for getting success in this competitive market. For leading change, it is very important for leaders to develop new ideas, models and application of technology which helps AEGON being different from their competitors and stand apart. As under transactional leadership, they motivate their employees by giving reward so that they perform better and bring some new ideas.
This is the approach under which a leader works with teams to identify need of change, creating a vision to guide the change through inspiration and execute change. This is an integral part of leadership model. This kind of leadership may be found at all levels of organization like teams, departments, divisions and organization as a whole. This approach can be used by the AEGON leaders in order to deal with change situation. The characteristics of transformational leadership is explained below:
The foundation of this kind of leadership is based on promotion of consistent vision, mission and set of values to members. These kinds of leaders guide their follower with the sense of meaning and challenge. Thus, they can work enthusiastically under the situation of change also. The leaders of AEGON have used this approach as so they can work with more effectiveness in order to promote their new and refreshing brand.
The leaders act as mentors to their subordinates and praise them for their creativity and innovation. As followers are empowered to make decisions and always provided with needed support to implement decision in situation like change. These are the approach which can be helpful in dealing with situation like change.
M4 Evaluation of leadership approaches
There are different leadership approaches for dealing with changes which are used by the leaders of AEGON. The positive side of transactional leadership is that it clearly defines the goals and roles of subordinate so that they can work properly. These approaches are helpful in keep employees motivated so that they can work effectively. This promotes the innovation and creativity within an organization. As transformational leadership approach is helpful in considering individualism. The both of approaches are very helpful for the leaders of AGEON to deliver organizational change effectively (Borowicz, 2012).
D3. Effectiveness of leadership approaches and change model
The leaders are important part of team as they have power to influence its subordinates and get work done through them. As an effective leadership is very important in order to keep motivated employees in change situation. The change model is crucial model it should be adopted by companies as it enables the company to be sustainable in difficult situation. For example, it can be seen from the case of AEGON, after making change in organization they have managed successfully to be competitive in market. The positive impact of transnational leadership is that it provides clear goals and role to its subordinates.
In the conclusion, it can be said that change plays an important role in achieving organization goals and objectives. There are different drivers of change which includes the internal and external drivers. The companies should take proper measure to minimize the negative impact of change on organization behavior. As there are different barriers for change and they can affect leadership decision making. There are different approaches of leadership to deal with organizational change.
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