Making Sense of Hard and Soft
The Implications of Different Collective Narratives During Organization-wide Change Christiaan Mein (S2558351)
MSc Business Administration – Change Management Faculty of Economics and Business
University of Groningen Groningen, 11-07-2018
Supervisor: Dr. C. Reezigt Co-assessor: Dr. B. Mueller
Abstract
In change management literature and practice, a distinction is made between hard and soft working methodologies and change management approaches. In the future, organizations are expected to make a shift from hard to soft working methodologies in order to keep up with environmental demands, however research on how this transition develops is limited. This research adds to the existing literature by studying how collective narratives of groups, with varying levels of involvement, differ during organization-wide change, and what effects these differences have on the change implementation process. The subject of this study is a large financial organization shifting from traditional hard project management to Agile working. 36 interviews were held and analyzed via Atlas.ti in order to capture the collective narratives, resulting in several composite narratives. The existence of different collective narratives regarding hard and soft aspects of the change were found to hinder the change process. Additionally, inconsistent narratives within groups were found to lead to limited change acceptance and increased sensemaking. Actor-network, value systems and sensemaking theories were used to further examine these differences and to place these findings in the current change management literature. Organizations could benefit from this research by realizing the existence of different collective narratives, and the effect those differences have on the change implementation process.
Table of content Introduction...4 Theoretical background... ...7 Sensemaking...7 Narratives...9 Project management...11
Hard and soft project management...12
Hard-soft change projects and narratives...15
Methodology...16
Procedure...17
Data analysis...20
Results...21
Change rationale, vision, goal and approach...22
Working methodology...30
Role of management...35
Organizational climate...43
Composite narratives...48
Discussion...50
Differences between groups...51
Differences within groups...56
Middle management and sensemaking...57
Managerial implications...58
Theoretical implications...59
Limitations and future research...59
Conclusion...60
References...62
Appendices...68
Appendix A: Interview protocol...68
Appendix B: Overview participants...69
Appendix C: Overview of the different narratives...70
Appendix D: Overview second order coding...75
The world of today is one of rapid changes, technological advancements, disruptions and global interconnection cause organizations to constantly redefine themselves and constantly adapting themselves to new environmental changes (Burnes, 2005). Failure to keep up with the changing environment can have huge ramifications, leading to loss of revue or even bankruptcy (Burnes & Jackson, 2011). In order to keep up with their competitors organizations need to adapt or change their method of operating, a process which requires organization-wide change (Cummings & Worley, 2007).
The process of changing is often accompanied by feelings of uncertainty and ambiguity due to the changing circumstances caused by the change (Weick, Sutcliffe, & Obstfeld, 2005). In order to reduce those feelings, actors affected by the change engage in a sensemaking process in order to examine what the change means for them and how will be affected by it. This process results in the construction of narratives, which are stories help actors understand the emotions and cognitions activated by the change process (Weick, 1995). Narratives have been found to be a key factor determining the success of change projects (Burnes, 2014), however how these narratives actually influence the process is unclear, thus requiring more research on this topic (Vaara, Sonenshein & Boje, 2016).
The ''best'' approach could also be applied to the working methodology adopted by organizations. Pollack (2007), distinguished between two organizational paradigms regarding the working methodologies within organizations. The hard paradigm assumes that organizations operate within one objective reality governed by mechanistic processes and that they can achieve one best way of working (Crawford & Pollack, 2004). The working methodology of organizations within the hard paradigm is often one of top-down control and has an emphasis on efficiency and productivity.
The other organizational paradigm takes a different approach. In it, the one objective reality is rejected in favour of a socially constructed reality, which leads to a greater emphasis on the effect contextual influences have on organizations. (Pollack, 2007). Therefore, different working methodologies might be required between and even within organizations. These methodologies have in common that they emphasise involvement, learning and inductive reasoning. Over the years, the organizational literature has shifted from advocating a hard approach to a more soft approach (Burnes, 2014). The turbulent environment organizations experience causes them to adopt a more soft methodology, due to it allowing them to quicker adapt to the demands made by the environment (Pollack, 2007)
thus the organization is a good candidate to research the sensemaking and narrative processes caused by this shift (Vaara, Sonenshein & Boje, 2016).
This study uses a interpretive narrative lens in order to capture the sensemaking process and resulting narratives, which is in line with research done on sensemaking due to it capturing the different perspectives governing the change (Vaara, Sonenshein & Boje, 2016). This is necessary, because this research assumes that the narratives within an organization can differ between groups of individuals, which is in line with research done by Brown, Stacey and Nandhakumar (2008). The purpose of this research is to answer the following question: How do the collective narratives of groups with varying levels of involvement differ during organization wide change and what are the implications of these differences on the change implementation process in return.
This research adds to the existing literature on organizational change by examining the possible causes of change success and failure. It fills a gap due to the limited understanding regarding the influence of sensemaking and narratives have on this topic (Vaara, Sonenshein & Boje, 2016). Additionally, more organizations are expected to shift from a hard to a softer working methodology, thus making this research relevant in the current change management literature. The Actor-Network theory (Law, 1992), value systems theory (Burnes & Jackson, 2011) and theories on sensemaking (Weick, 1995) are used in order to describe possible causes of limited change adoption as a result of the sensemaking process.
them. Finally, managerial and theoretical implications are discussed, alongside the limitations of this study and suggestions for future research
Theoretical background Sensemaking
According to Burnes (2014), one of the key factors that determines the valence attributed to a change project by employees is the way that they 'make sense' of events that are the result of the change project. Weick, Sutcliffe and Obstfeld (2005, p.1), define sensemaking as: ''the ongoing retrospective development of plausible images that rationalize what people are doing''. Sensemaking helps actors to derive meaning from events and interactions with others in order to provide a sense of understanding about them. It is an ongoing process that causes actors to both react and shape the environments that they derive meaning from (Thurlow & Mills, 2009). Although research into sensemaking has been criticised by some researchers, due to the high subjective nature of the process (Vaara Sonenshein & Boje, 2016), the fact that sensemaking has been found to influence the trajectory of change processes makes it worthwhile to examine (Buchanan & Dawnson, 2007).
Weick (1995) is one of the most influential authors on the subject on sensemaking and stated seven underlying characteristics that need to be kept in mind when looking at the sensemaking process. These characteristics are echoed in the above stated definition and continue to shape research on sensemaking to this day, therefore they are worthwhile to discuss (Turlow and Mills, 2009). These characteristics are: identity construction, retrospective, enactive of sensible environments, social, ongoing, focused on extracting cues and driven by plausibility (Weick, Sutcliffe and Obstfeld, 2005; Weick 1995)
I''. Because this process is inherently interactive, actors definitions of themselves are constantly shifting and actors are thus engaging with a constant process of identity definition and re-evaluation. Actors can engage in identity construction on multiple levels: individual, interpersonal and collective/categorical (Brewer and Gardner, 1996), which means that they will present themselves differently depending on the social context.
Secondly, the process of sensemaking is retrospective (Weick 1995), thus actors can only make sense of events that have already occurred. This also means that the valence attributed to future events depends on events that have already happened. Because of this retrospective nature, the valence that is attributed to events by the individual can be considered to be the result of the sensemaking process (Weick, Sutcliffe and Obstfeld 2005)
According to Weick (1995), the third characteristic of sensemaking, enactive of environment, implies that actors shape and create their environment through their actions and can be better understood by looking at Campbells (1965) evolutionary epistemology of social life. Here it is proposed that, when actors interact with their environment, meaningful events are selected and preserved and, in turn, these selections determine how actors will respond to these events, shaping the environment in the process. Weick (1979) himself called this the ESR (enactment-selection-retention) cycle. Because those enactments cannot be made by actors in isolation, the social characteristic of sensemaking is made salient through the ESR cycle.
The final characteristic highlights that, through the process of sensemaking, actors can only construct a plausible reality and not an accurate one. The outcomes of the sensemaking process will differ from individual to individual as they continue to shape and approach reality. Because they will never reach a true image of reality, this final characteristic places sensemaking firmly in the social constructivist paradigm (Burnes, 2016).
Narratives
When sensemaking occurs regularly actors will create narratives, which are stories that help them understand their cognitions and emotions surrounding certain events (Bruner, 1991; Weick, 1995), which can make or break change projects (Burnes, 2014). These narratives have been found to be especially prevalent during change projects, due to them introducing new concepts that actors need to interpret and disrupting the daily routines these actors have with regard to their work. (Thurlow & Mills, 2015). These new events need to be interpreted by recipients in order to fit them into an existing narrative, determining their reaction towards the change project. For example, Helpap and Bekmeier-Feuerhahn (2016), found that employees possible resistance towards change could be explained by looking at the negative narratives that were developed as a result of negative sensemaking. In contrast, employees who interpreted change events in a more positive way were found to have developed positive narratives, which lead to less resistance against the change project.
Chittipeddi, 1991). It is through this interactive process of sensemaking and sensegiving that narratives are developed.
When actors engage in this process of sensemaking and sensegiving on group level the result of this process is a collective narrative. A collective narrative is assumed to be constructed when actors who are belonging to the same group come together. By discussing their individual narratives with each other, the multiple individual narratives are converged into one (Abolafia, 2010), once again highlighting the social characteristic of sensemaking. According to social psychology, collective narratives enable individual group members to understand the relationships between their group and other groups, within the confinements of their social environment (Bruner, 1990). The collective narrative will also influence the further development of the individual narratives (Maitlis & Christianson, 2014)
Individual and collective narratives can also be influenced by the narrative that the firm itself promotes as it is put forward by managers and the top of an organization (Sonenshein, 2010). Sonenshein called this the organizational narrative, which is constructed by formal stories as told by upper management about their interpretation of certain events, for example that the initiation of a new product face will create benefits for the entire company (Browing, 1991). These organizational narratives have been found to influence the direction in which the individual sensemaking process will develop (Guiette & Vendenbempt, 2017). This same research has found that, when the dissonance between the organizational narrative and the individual narrative is too great, this can lead to greater resistance towards change in employees. Finally, organizational narratives can have the same effect on the trajectory of a change process as individual narratives, due to them continuously shaping and giving meaning to the project (Thurlow & Mills, 2009).
constructed (Vaara, Sonenshein & Boje, 2016). A composite narrative is constructed by researchers when collective narratives from different actors in different organizational areas are put together and these narratives are found to overlap in certain ways. For example: when looking at the narrative construction of organizational change processes Sonenshein (2010) found that multiple actors from different parts in the organization reported that they expected the change project to improve the organization, which led him to identify a progressive narrative. However, multiple composite narratives can occur within one organization. For example, Sonenshein (2010) also found there were multiple actors from different positions who felt that the change would damage the organization, thus leading him to identify an additional regressive narrative.
Project management
Change projects are usually accompanied by feelings of uncertainty and ambiguity due to the changing circumstances caused by the change, therefore requiring actors to engage in a sensemaking process in order to reduce these feelings (Weick, Sutcliffe, & Obstfeld, 2005). In order to properly guide the transition, project management is often used (Hornstein, 2015) However, what constitutes as ''successful'' project management, has differed over the years (Stretton, 2007).
for project development, however it has been criticized for ignoring the fact that projects rarely follow a linear path towards completion, thus the careful planning it advocates cannot account for the unpredictability of the process (Burnes 2017). Additionally, current organizations are more interdependent and connected with each other, leading to more external stakeholders and complex projects. It has been advocated by some that these new ways of working require a stronger focus on adaptability, instead of careful planning (Pollack, 2007). However, because this shift has been gradual, both styles are still used today, making a clear distinction between the two difficult.
Hard and soft aspects of project management
In order to apply the differences between the two paradigms to the field of project management, Crawford and Pollack (2004) constructed a framework in which they broke down project management as a working methodology into seven aspects, which can be rated along a hard/soft dimension. The seven dimensions that are found within this framework are: goal/objective clarity and tangibility, success measures, project permeability, number of solution options, degree of participation and participation role and stakeholder expectations. The framework has been used successfully to explore the hardness/softness of these dimensions of certain projects in project management (Crawford, Hobbs & Turner, 2005; Albers, 2017). A key point of the framework is that the concepts of hard and soft are not mutually exclusive and that both aspects can exist within a project, therefore the hardness/softness of a project should be rated along a continuum (Crawford & Pollack, 2004). However, the combination of both hard and soft aspects within a project can lead to more difficult to manage projects, rather than simply managing a truly hard or truly soft project. The following sections delve deeper into the different dimensions of this framework.
The first dimension, goal clarity, indicates how clearly defined project goals are at the start of the project. When goals are very clearly defined at the start of the change project and are not deemed to be subject to future changes, the project can be rated as hard (Crawford & Pollack, 2004). However, when goals are not clearly defined at the start of a project the dimension can be rated as soft.
The third dimension, success measures, is strongly connected with the two previous dimensions (Crawford & Pollack, 2004) due to success measured being used to determine to what extent certain goals have been achieved. Measures that are clearly definable and tangible are classified as hard, whereas soft success measures require extensive qualitative and in-depth research.
The next dimension of Crawford and Pollack's (2004) framework is project permeability which refers to the degree to which internal processes and outcomes are influenced by external, environmental forces that exist beyond the boundaries of project control. If these external environmental forces are deemed to be stable, or if the project is expected not to be influenced by environmental turbulences this dimension can be rated as hard. However, if the change project is expected to be influenced by these outside forces, either directly or indirectly, the dimension can be rated as soft.
The number or project solutions is influenced by the permeability of the project. A project that has an impermeable boundary can have one ideal solution due to the absence of external factors allowing a stable environment in which projects can be carefully planned (Beer & Nohria, 2000), which is a hard aspect of project management. In contrast, when the solution is ambiguous and requires active debate between stakeholders and further exploration of the project and possible solutions, it can be considered a soft aspect.
The last two dimensions of Crawford and Pollack's (2004) framework, concern stakeholder involvement and stakeholder expectations that are held by those in charge. If a project has little room for stakeholder participation, it can be rated as hard (Beer & Nohria, 2000). As a result, stakeholders are perceived to act in predictable ways that can be
By providing the above framework, Crawford and Pollack (2004) make it possible to look at the different aspects of project management in a more structured way and allow for the distinction between the two most common paradigms to be applied to this field. Finally, it should be noted that, although all the dimensions of the framework are examined individually, they are interrelated and do not stand on their own.
Hard-soft change projects and narratives
Because project management is often used to guide change processes (Hornstein, 2015; Stretton, 2007) the hard-soft continuum can also be used in order to classify change approaches. For example, change approaches that focus on rapid short term changes and are led in a top-down fashion, such as Kanter's (1989) Bold Stroke approach, can be classified as hard. Another example of a hard approach would be Theory E (Beer & Nohria, 2000), due to its similar focus on rapid structural changes by using financial incentives.
On the other side of the continuum are more soft approaches such as the Long March (Kanter, 1989) due to it being a slower change approach with a strong focus on cultural changes. Because the scope of a cultural change involves the entire organization, it is a more bottom-up change approach, where involvement from every individual within an organization is required to achieve successful change (Stein & Jick, 1992). Another example would be theory O (Beer & Nohria, 2000) which also emphasizes organizational learning. Although both soft and hard approaches can be used for different ends, both Kanter (1989) and Beer & Nohria (2000) argue that by combining two different approaches the strengths of one
approach can accommodate for certain pitfalls that the other one might have. Therefore, the overall change approach for the execution of organization wide change can be rated along the hard-soft dimension as well.
implementation of the change. Burnes and Jackson (2011) argue that 70% of change initiatives fail due to misalignment between the values underpinning the content of the change, the process by which these values are managed and the values of the organization. This misalignment is problematic because non-aligned values foster more negative feelings regarding the non-aligned areas, which can lead to individuals resisting the change, thus influencing the construction of their narratives. Therefore, the hard-soft dimension should also be applied to the content of the change and the interaction between the three values can be useful in explaining the collective narratives
Organization wide change is also often accompanied by uncertainty and ambiguity, due to the existing difference between the current and the future state of the organization (Sonenshein, 2010). Individuals subject to this uncertainty will want to reduce these feelings, thus allowing for sensemaking, and narrative constructions, to take place (Weick, Sutcliffe, & Obstfeld, 2005). How these narratives are constructed is largely determined by the effect that, the content of the change, the aspects of the change process, and the events following from them, are interpreted and voiced by the different actors within an organization. The hard and soft aspects each have different effects on this content/process, therefore they influence the narrative construction. Thus the research question for this study is the following: How do the collective narratives of groups with varying levels of involvement differ during organization wide change and what are the implications of these differences on the change implementation process in return.
Methodology
compositions and an accompanying shift in mindset. These changes will initially affect circa 5000 employees working in Amsterdam, however global rollout is planned in the next implementation phase affecting over 40.000 employees. The employees are expected to shift from project management methodologies to One Agile Way Of Working (OAWOW), thus making a shift from hard to more soft working methodologies. By making this shift, the organization hopes to be able to provide faster product delivery and faster adaption to market demands. Currently the organization is on the verge of implementation, is finishing the final design and has recently appointed new senior managers responsible for the implementation. Prior to this phase several pilots were conducted to experiment with the OAWOW and introduce employees to the upcoming changes. These change initiatives, alongside corporate wide communications about the OAWOW, started the sensemaking process of actors, making the organization an appropriate case for the current research. Finally, the shift from hard to soft working methodologies make the case site a good subject for the application of the value systems theory (Burnes & Jackson, 2011).
This study was part of an ongoing collaborative research project from the University of Groningen and the financial organization. In this round, three researchers worked together in order to gather the necessary data and to code the responses of participants. Previous research has looked at the organizational narratives that were in place, prior to the start of the change process (see, among others, de Boer, 2017, Poortstra, 2018).
Procedure
care to avoid leading or steering questions while gathering qualitative data, because these can create narratives that do not reflect the original narrative of participants and can negatively impact construct validity (Aken, Berends & van der Bij, 2012). Because steering questions are more likely to appear in structured interview protocols, this research used grounded theory and unstructured interviews to gather qualitative data (Wolfswinkel, Furtmueller & Wilderom, 2013). The interviews started with the pre-formulated question: ''How would you describe [name of the organization] and your role within [name of the organization]'' and, ''Why is [name of the organization] implementing this new way of working'' Afterwards, the researchers used mainly clarifying questions in order to uncover the underlying narratives of the participants and to clarify further details (Yin, 2013). Clarifying questions were mostly formulated by asking about the how and why of certain processes, e.g. ''You talk about already adopting agile methodologies, how did you start this process?'' and '''Why are you enthusiastic about the new way of working?''
snowball sampling makes it difficult to reduce sampling error, thus simple random sampling was also used (Rosenthal & Rasnow, 2008). The combined process resulted in 15 participants. At this point in time, it became clear that employees at the lowest hierarchical level of the organization were not included in the sample, thus judgmental sampling and snowball sampling were used to cover this gap. This resulted in the final 12 participants for the third round of interviews. In the above cases where simple random sampling was used, care was taken to gather participants from different social backgrounds, nationalities and genders. See Appendix B for an overview of the participants and their respective hierarchical layers.
Prior to starting the interview, participants were ensured of confidentiality and anonymity and were asked whether or not they were comfortable with the researcher making an audio recording of the interview. Additionally, due to the global nature of the organizational, English was the main language for organization wide formal and informal communications, making it the language of the organizational narrative. In order to prevent translation errors between the organizational and the individual/collective narratives, native Dutch speakers were asked if they were comfortable with conducting the interview in English. At the end of the interview participants were asked if they would like to be updated on the end-product and thanked for their time.
information about the change process, such as external agile coaches and employees from the change project communications department. However, due to the divisive nature of this material, the information was not structurally coded, thus making it only useful as side information.
Data analysis
The three researchers worked closely together during the data collection and analysis period in order to reach intersubjective agreement, which provides greater reliability due to different researchers looking for different subjects (van Aken, Berends & van der Bij 2012; Harasym, Woloschuck & Brundin-Mather, 1996). Every time an interview was conducted, the two researchers who conducted the interview updated the absent researcher on the topics that came up. Afterwards the content of the research, research methodology issues, and the future direction of the research were discussed collaboratively. As soon as an interview was conducted, the researcher who was absent during the interview started on transcribing it, ensuring that every researcher held detailed knowledge about the contents of the interview. Because an overlap between the data collection and the data analysis phase leads to a greater understanding of the research, while keeping in mind that too early interpretation can lead to blindness and unjust explanations of data, data was coded after half of the necessary material was collected (Eisenhardt 1989).
Aiken, 2003). A second round was then conducted on an individual basis due to time constraints. In this round the researcher went over each transcript sentence by sentence and assigned codes based on the actions that participants described, resulting in descriptive codes (Charmaz, 2008). The resulting codes were pooled together and overlapping codes were re-evaluated which resulted in the first codebook with 602 codes, with codes such as be consistent and top-down.
Second order coding was done on individual basis and was conducted after all the data was collected and coded. The codes and transcripts were reviewed again in search for possible patterns. Codes were grouped based on their relevance, which led certain codes being discarded (453). This resulted in the final codebook with 149 first order codes and 36 second order codes depicting more abstract concepts. Finally, the second order codes were grouped, which resulted in several themes. An overview of this process can be seen in appendix D, the final codebook can be found in appendix E.
Results
Based on the analysis of the unstructured interviews patterns emerged. Certain narratives were found, which were then linked to certain groups within the organization. The narratives highlight different perspectives regarding the change. The different groups are the following:
Amsterdam located Amsterdam located Outside of the Netherlands
Business group: subgroups IT group Outer group
Top management (MBB-1 and MBB-2)
Middle management (delivery vs. service) Employees
Within the business group a division into subgroups can be made based on the different hierarchical layers. The perspectives of these subgroups regarding the change differ in some areas, however they are similar in other areas. Additionally, within the middle management, a distinction can sometimes be made between the delivery side (focused on delivering products) and the service side of the organization (focus on maintaining products). However, this distinction can only be applied sporadically, therefore they are not grouped separately. Overall, the perspectives regarding the change within the business group differ from those belonging to the IT group. However, due to both groups being located in Amsterdam, they still share some perspectives regarding the change, which differ largely from the perspectives of those who are not located in Amsterdam. An overview of how the participants fit within these different groups can be found in Appendix B.
The following section describes the perspectives of these different groups regarding several different change related topics. These topics are: the change itself (rationale, vision, goal and approach), the previous and expected working methodology, the management (current role of management, expected role of management, and change communication) and the current and expected organizational climate (as it will be under the new working methodology). An overview of the results can be found in Appendix C. Each section starts with the narratives within the business group, followed by the narratives of the IT group and ending with the narratives of the outside group. At the end of each section the different narratives are summarized, according to their respective groups. Finally, an overview of the resulting composite narratives is presented.
The change itself
Rationale of the change. The three business subgroups all voiced the same rationale for the change, thus they will be treated as one group for this section. The three groups voiced similar ideas regarding why the organization needs to change and how new working methodology would fits within this need. All groups perceived the same need for change; the environment of the organization is changing and the organization needs to adapt in order to keep a competitive advantage. The groups voiced that the increased presence of innovative start-ups, that are capable of quick adaption to market demands and threaten the current operating model of the organization. All groups expressed a pressure to change where, if the organization does not change, it will cease to exist in its current function within the coming years. Business group participant O08 elaborated on this need of change and compared the organization to a containership:
[Organization] is such a huge organization, it is like a containership. Very difficult to manoeuvre the whole organization. If you want to make 90 degrees change, it is impossible to do that in a short term. So, how do you get there? We need to do that. Otherwise containerships won’t be there anymore, and we find other ways to move goods. How to adjust such a container ship which is on a dinosaur backbone?
The new working methodology is expected to facilitate in this regard and a lot of participants expressed excitement due to the organization being one of the first to implement this type of change. However, they also expressed that being one of the first makes for a more difficult process, due to the organization not have any comparable examples, makes the entire process more complex.
Vision of the change: Initially, the new working method was started in a bottom-up fashion within the IT department of the retail branch of the organization. Due to it being a success, the CEO of the entire organization adopted the new working methodology and made it part of the vision of the organization. Participants within the middle management and employee groups referred to this vision as ''being an IT company with a banking licence'' and ''always be a step ahead''. They voiced that the vision helps with aligning all of the different branches of the organization towards one way of working. Previously the organization had a lot of different legacy systems within different branches of the bank, leading to differences in values and ways of operating between the branches. However, some middle managers belonging to the service domain did not think that the vision is applicable to their domain, even though they recognized the usefulness for the delivery domain. As O16 puts it:
''...the [organization] statement is we are an IT company with a banking license and if I look at the field of operations that I am in I would say that it is really a bank activity. For certain activities I don’t need IT. I need knowledge and people with experience and expertise to actually make the difference''
The IT group was largely in favour of the vision and this was echoed by every participant that was interviewed. The vision was perceived to highlight the importance of the IT department, which was in line with how the participants placed themselves within the organization. They considered themselves as ''the backbone of the organization'' and the vision is perceived to recognize their importance.
The outer group felt that the vision itself was good because it will bring more alignment between the legacy systems of the national branches. However, they also voiced that the lower levels within the different countries do not yet see how it will personally impact them. They also recognized that this needs to happen in order to make the change successful As O04 put it:
''But still, I think, we may have our vision within our centre of expertise. But the tribes, and the people in the tribes, we all should speak the same language. And the direction that needs to be sharpened up in the coming period.''
Overall, all groups acknowledged that the vision is the way to go forward for the organization. All groups also voiced that, if this change is going to become successful, management of all layers needs to be committed towards the change. Both top and middle management recognized this concern and voiced that they themselves are very supportive of the change.
Goal of the change. Within the business subgroups, the perceptions regarding the purpose of the change are all voiced in terms of bringing benefits and the perceptions regarding the goals of the change were mainly positive. All subgroups perceived that that the change is being implemented in order to increase the delivery speed of products, to increase the adoption speed of the organization towards market demands and to shorten the communication lines between organizational branches. They also stated that the change was introduced to bring greater collaboration between individuals and to harmonize the different departments.
The IT group shared a lot of the perceptions of the top and middle management business subgroup, however they also stated that a major goal of the change is to bring the IT people and the business people closer together and in the same team. They also stated that the change was implemented in order the increase the alignment between the final product and customers' expectations. Additionally, because they had already changed their working methodology, they stated that these goals have largely been met and the new working methodology is experienced positively. IT09 states the experience as follows:
The outer group shared the same perceptions as the business group with regards to the increased delivery speed and more efficient collaboration. Additionally they perceived that the change is being implemented in order to align the priorities between the different national branches.
Change approach. When the research was being conducted the top management group was in the process of designing the new organizational structure. Some perceived this design process to be very good due to the collaboration within the top management group being very thorough. They also stated that the middle manager group is often asked for input, thus the perceived that the process ''brought everyone together''. Additionally, they perceived it as positive that both business and IT representatives are working together on the design. However, some were more sceptical with regards to the outcomes of the design process, stating that they still had a lot of unanswered questions regarding the design, mainly because it is uncertain what the service part of the organization will look like, and how it will interact with the business. Additionally, top management perceived a lot of pressure to deliver the final design from the rest of the organization
''It’s also not really being rewarded for the actions that you have done. So a lot of time and energy was put in the design and then all of a sudden it changes. But being operations you still want to make it work so you then, okay, accept and go ahead and try to make the best of the rest.''
Additionally, not every middle manager was involved in the design. Those that were not involved, perceived more uncertainty due to details about the process not being communicated to them. They acknowledged the fact that not everyone needs to be at the design table, however they would have wanted more information, especially because they were unable to answer the questions the employee group asked them about the design. They also were more sceptical about the change success, because they perceived the design to still have a lot of overlap and dependencies between the different organization branches, whereas they viewed this process as the perfect opportunity to tackle those issues. Finally, they voiced that the employee group was not being involved in the design, which they perceived to be a missed opportunity due to employees knowing their work better than top management.
Beyond the design, within the subgroups differences existed as to whether or not the change approach could be classified as top-down initiated or bottom-up. Individuals within the business subgroups that were already working according to the new working methodology, due to working in pilot groups or management already implementing certain aspects, reported the change approach to be bottom-up. However there were also individuals who perceived the change approach to be top-down due to it feeling forced upon them from the top. Others voiced that they perceive the change approach to be a combination of both, where bottom-up change initiatives became supported by the top, who then introduced it everywhere within the organization. Voicing this opinion, TS02 explained the change process in the following way:
Bottom-up you could feel some pressure of our staff saying: we want this it is cool. Also some resistance, let's be clear it is anxiety you change ops. But you see that the younger people who had better connections with the Netherlands also start to support it. So then gradually when you get a sort of feeling of comfort with that. ... And at a certain point in time things got easier as well because the leadership of the bank as a whole said: you need to implement this in 2017 or 2018 whatever. So from multiple angles and then the final one was the top''
The IT group perceived that both IT and business representatives were involved in the design and felt that they could exert enough influence on the design to be comfortable with the process. They perceived the change process to be bottom-up for their own branch, because the IT group adopted the new working methodology on their own volition, due to the successes the IT department within the retail branch of the organization experienced with it.
organization. They stated that process being focused on the location in Amsterdam contradicted with the ''we are a global company'' statement by the top management of the organization. As a result, they hold a more sceptical view towards the design and they viewed the change approach as top-down.
Working methodology
Because the working methodology is expected to change, participants were asked how they perceived the old working methodology to be and how they perceive the current/expected working methodology to be.
Previous working methodology
which resulted in ''a lot of top-down control''. The employee subgroup also perceived that they were not always appreciated for the work that they were doing.
The IT group was already working according to the new methodology, however when asked how they perceived the older working methodology compared to the current methodology they voiced the same perceptions as the business group. Additionally, they voiced that is was difficult for the IT department to implement the wishes from the customers, due to there being a larger gap between the business and employee side.
The outer group perceived the old way of working in the same way as the business group. Additionally they perceived a lot of steering from the headquarters in Amsterdam, and that this conflicted with the priorities held by the different national branches.
Expected working methodology
providing less day to day steering for the teams. However, some also reported that they worried about ''how does this whole movement relate to the control model that we run as a bank?'' (O12).
The middle management group voiced similar perceptions, however they also struggled with how they should combine the greater responsibility of the teams with the steering of the top management group. They expected the teams to be able to choose their own priorities and deadlines, while still having the pressure to deliver products in a timely fashion. Middle manager O03 explained this struggle:
''We promise something by 2020 and then at the bottom the teams say: ‘’yeah but we’re self-steering and we can do what we want so sod it off we just decided we’re not going to do this project’’ So bringing this together is also a challenge and a lot of people heard like self-steering where they are the boss, we don’t need a manager anymore. But how do you bring communication that you high level to the market.''
Within this group there also existed a split between those belonging to the service organization and those belonging to the delivery organization. Whereas delivery managers perceived the new working methodology to improve their day to day work, service managers did not think that the new working methodology is useful to them. Service managers reported that they did not need to see short-term benefits, instead they required the same expert knowledge they needed under the old working methodology. Regarding the rituals, O07 stated:
''Yeah with sprints is, okay if we have something ready, at least the effort can be implemented. Things are not ready, you can built a car without wheels, and then a car is ready but you cannot do anything about the car, I cannot implement a car without wheels because my client cannot do anything with the car. And then you can say, okay but in four weeks we have the steering wheel. Okay, but what can I do with a car without a steering wheel? We cannot ride.''
The employee group expected the new working method to allow for a greater sense of freedom and greater cohesion within the teams. They also expected the new working methodology to allow for greater appreciation of their work by higher managerial layers and that it will allow the teams to choose their own priorities. This was often phrased in that the teams will be more 'self-steering'' in the new organization. Management was expected to only have a coaching role in the new organization and is expected have less influence on the day to day work within the teams.
employees underestimated how much structure and rigour is required for the new working methodology. As a result of this imbalance, the middle management group was caught between trying to adhere to the steering done by higher management, while still allowing greater responsibility for the teams.
The IT group already worked according to the new working methodology and perceived a lot of benefits in that regard. They perceived to be more closely connected to the business and that there existed a greater sense of cohesion within the teams. However they experienced a lot of ''side-steering'' which was caused by priorities set by the business group conflicting with the self-steering aspect of the teams, and they viewed that this is a problem that the business group needs to solve. Although some participants hoped that this will change in the future, those involved in the design process perceived the new organizational structure to still be influenced by conflicting priorities between higher and lower organization branches. IT09 worded it the following way:
''That’s what I don’t like in the new organisation. You have wholesale bank, and wholesale bank tech, this was the ultimate opportunity to merge them. Not with an own hierarchical line. ... So I do think there still be side-steering, especially because of the change and that people will go away.''
Role of management
During the interviews the term ''management'' was often used in a broad sense. Due to the organization being perceived as hierarchical, management was seen as an important factor that would determine whether or not the change would be successful. In this section the current role of management, the expected role of management and the communication about the change will be discussed.
bottom-up suggestions''. All business subgroups agreed that this management style was unfitting for the new working methodology.
As a result, the top management group had undertaken efforts to change their management style. They stated that agile coaches were available in order to provide feedback on their personal style, and some engaged in trainings or have talked to their business counterparts belonging to the retail branch of the organization. Additionally, the top management layer went through a reorganization process where all of the previous top managers had to reapply for their function in order to determine whether or not they were capable of adopting an agile management style. This process was perceived to be quite thorough and experimental by those who were involved in it. Previously, the MBB-1 layer was largely involved in the selection process, whereas a hiring committee was appointed to guide this process instead. Additionally, some functions could not be filled by individuals from the current pool of applicants, thus the decision was made to leave some positions unfulfilled and to fill other positions with interim managers. As a result there was a lot of faith in the process. For example, FM01 states:
''The process itself was two interviews, with two people each. So, in total four persons. But then in two interviews. And an assessment. I think it was a solid process with the right questions. I think it was good.''
they were sceptical whether or not the managers are capable of changing their management style. O14 stated:
''Well, there is not much new blood. There is some people moved to a different area than they used to be in, but for the main part they are appointed in the area that they were already in. So what’s new? Is this really going to make the change? That is really the first question I asked myself when looking at the list of names. Is this actually going to change the way of working?''
The decision to leave some functions unfilled and appoint interim managers to some positions, was perceived as surprising by the middle management group. Those with more insight into the process stated that they expected certain names to be very capable of performing in the new functions, however these were not appointed in the end. Due to some top management positions not being filled, middle managers reported that certain decisions were not being made, which caused a slow-down in productivity.
The employee group reported that they did not have much insight into the application process, therefore they did not have an opinion as to how that process went. They reported to have a lot of faith in the new appointments even though they ''See a lot of familiar faces, I don't know if that is good or bad, we will have to see'' (FM02). However they perceived that communication regarding the appointment process was lacking and they would have liked to be better informed in that regard.
they perceived that their top management layer was already capable. However, middle managers from the business group reported that they did not understand why an exception was made for the IT group, thus they were more sceptical regarding the capabilities of these individuals.
The outer group perceived that they were passed over for the top management appointment process and state that that feels inconsistent with the vision of the company. O04 stated:
''The story that [name] brings from a Wholesale perspective is like ‘we want to be a global company and blablabla’ but on the other hand, on the deliver side, and this starts with the management layers that were put in place, you see that things get kicked off purely Amsterdam pale, that’s not consistent, right. And people start to interpret things behind that, and they see the inconsistency, that’s not adding up,''
employee group might have different expectations in that regard. Top manager TS02 stated: '' People say that agile is fantastic and freedom. Agile in reality is the most disciplined form of organization I have ever seen''. Top management also perceived that those who were recently appointed were now capable of the expected management role, and that massive changes will no longer be needed.
The employee group indeed appears to have a different perception regarding the role of management with regard to the new working methodology. They expected management to be more coaching and facilitative. Some reported that they had seen their direct manager adopting these concepts, however others felt that management was still managing the organization in the same way they always did. The latter group also appeared to be more sceptical about the success of the new working methodology. Overall the employee group expected that the role of management will change further once the new working methodology is fully implemented.
The middle management group perceived that there were different expectations regarding the role of management between the two groups and that these expectations were conflicting. They perceived that senior management did not know how to change appropriately as a result. For example, O15 states:
''And I think it is still like that. That management has no idea where to step in because they really do want this change and see the use for it. But they don’t know, should I now assist? Should I just back off? What should I do? And I think that is just something that is really hard''
some reported to experiment in adopting a more coaching and facilitative role, while others still carry out their classical directive role. However, the fact that these two roles exist simultaneously and vary from manager to manager is perceived by the employee group as inconsistency in management.
The IT group did not expect the management style to change that much, due to them already adopting the new working methodology. They did state that the top and middle management groups needs to make a lot of changes in their management style in order to properly function within the future organization.
As mentioned before, the outer group expected that the managers from the different national branches will have a larger influence in establishing the future strategy of the organization. However, due to them not being allowed to apply for top management positions, they felt that the Amsterdam branch is not living out the values they said the new working methodology would be centred around. As a result, they stated that they were sceptical whether or not the change will actually succeed.
were also being used. During the data collection phase, the researcher observed large banners announcing the change, posters on the work floor and blogs, vlogs, articles and updates being posted on the intranet.
The top management group perceived the communication to be sufficient and reported that everyone within the company should be aware of the upcoming changes and why the change is needed. They stated that the information is ''detailed'' and ''employees are responsible for gathering information'''.
However, according to the employee group, the communication was not enough, especially because the ''personal and emotional part'' was missing. This was also perceived by middle management. For example, O03 states:
It could have been better, from time to time they do a townhall, but they do not touch the topics that people are interested in. What people are interested in is; what does it mean for me, what’s going to happen with what I’m doing and to more how are we going to work?. And I understand because in a townhall we’re talking about thousands of people, so we can’t really talk about you and you, because it’s clearly not possible.
them, however some managers are perceived to share more information that others, which was perceived as inconsistent. Overall the employee group perceived that they were not fully informed and that certain information was kept from them.
The middle management group recognized the need of the employee group, and stated that they would have liked to be better informed as well. They explained that they missed ''What the future organization will look like'' and what the personal effects will be for the employees. In order to avoid miscommunication, some middle managers referred employees to the information on the intranet. However, there were others that tried to mitigate the concerns of the employee group by organizing special events where they sat together with the entire team and answered their questions. In addition, the middle management group would have liked more frequent communication, because they were often unable to answer questions from the employee group. The middle management groups was of the opinion that more frequent and personal information would have involved and activated the employee group more, and stated that that still needed to happen in order to make the change a success. Finally, they reported that work pressure prevented them from engaging with the new working methodology and that they could not finish the trainings provided via the intranet due to it.
The IT group perceived the information to be sufficient, however most of them reported that they were not interested in the new communication at this stage because content in them was already known to them. Senior management within the IT group was perceived to be responsible for communicating the changes that were relevant to them.
Therefore the outer group reported that they were sceptical whether or not the new methodology will actually impact them. They would have liked a more personal approach with regard to the information that was being presented by the top management business subgroup, instead of receiving all of the information via the intranet. The middle management group perceived that the outer group should have received more ''frequent'', ''intensified'' and ''structured'' communication. When they interacted with their counterparts in different countries, they reported that they were often tasked with answering questions about the impact of the new working methodology even though they did not know it themselves.
Organizational climate.
management because the teams are supposed to take over a lot of managerial tasks, for example current responsibilities of project managers will be given to the teams instead. However, this group stated that it was unclear how and to what extent this change will be. In order to be ahead of the reorganization, a lot of middle managers were currently questioning if they wished to stay with the organization, or if they would rather move to another organization. Additionally they were questioning whether or not they want to work with the new methodology in a different function. Most participants reported that they personally view the change as an opportunity to further develop themselves within the organization, whereas those around them view the change as a threat to their job
The middle management group perceived certain behavioural effects in response to this experienced uncertainty. Participants from the middle manager group reported that they see more ''talking around the coffee machine'', where individuals talked about what the change will mean for them and how they could assist each other. The group also reported that collaboration between teams has become more difficult, individuals tried to hide mistakes instead of confronting them and they were less focused on their job. Middle manager O03 stated:
''The same for me, I’ll do what I have to do. I’ll continue what I’ve been doing but meanwhile I’m also looking what I’m going to do tomorrow, because it doesn’t make sense to put all your eggs into one bag and push it forward''
as a natural reaction and it is expected to strengthen the quality of the middle management group. The top management group expected that motivated and capable individuals will remain within the organization and that those who do not fit within the organization will be well compensated and will be guided in the process of finding a new job.
The employee group also perceived uncertainty due to them not knowing what their place will be in the organization, however their reactions to it differ. All the subgroups perceived that the change will be harder for older employees, thus there is an expectance that older employee group members will be more worried. However, older employees stated that they have faith in their skills, therefore they expected that they will remain with the organization. Additionally, most of them reported a sense of change fatigue, due to the many reorganizations that they experienced, therefore, they argued that they tried not to worry about the future. Younger employees perceived the organization as one where change and reorganization was always possible, and they chose to work within the organization due to the perceived complexity that those changes will bring. Therefore they saw uncertainty as a fact of life and tried not to be affected about it.
The IT group expected that IT employees and top management will not be subject for the reorganization and they perceived little uncertainty within these groups. However, their middle management was expected to be subject to the reorganization and perceived a lot of uncertainty as a result. Here the same concerns and behavioural effects were reported, along with the perception that older employees were more worried than others. IT09 explained why:
otherwise why do we do this change then? So I think a lot, not a lot, some of my peers are very worried, but also because of their age, 50 plus or so.''
The outer group did not perceive any uncertainty in this aspect. They reported to be more occupied with other concerns regarding the new working methodology.
Expected organizational climate. The business subgroups shared their perceptions regarding the future organizational climate. After the full implementation of the change in September it is expected that a drop in productivity will occur due to individuals of all hierarchical levels having to adapt to the change. It is perceived that the development of an ''agile mindset'' will take time, as well as people adjusting to ''agile rituals'' and getting used to the new team compositions. All subgroups stressed that it is important that this period of adjustment is allowed by management. Middle manager O06 states:
Additionally it was expected that things will go wrong due to the new situation. The employee group stated that a safe and trusting environment will help in tackling these mistakes and that management needs to facilitate a constructive environment where mistakes are viewed as a learning exercise to avoid future repetition. The top and middle management layer acknowledged this feeling and managers that already had experience with the new working methodology stress the importance of allowing mistakes as well. L01 states:
''We should be allowed to make mistakes and learn from those mistakes. That’s another lesson coming forth from this one. Unfortunately, it has client impact, and agile is all about client experience, right? So that’s a bit the downside of it. But let the team learn from it. Very important factor for the next stage.''
The IT group also expected an adjustment period and a drop in productivity as a result of that period. When the working methodology was adopted by them, they experienced the same things, therefore they expect it to happen again. The importance of the allowance of mistakes is stressed by this group as well.
Composite narratives
All the groups perceived the need for change due to the competitive environment of the organization and that the goal of the change will help achieving faster delivery speed. However the participants of the different groups did not have similar narratives regarding the rest of the categories. The following composite narratives are constructed according to the definitions of hard and soft by Crawford and Pollack (2004) with help of the framework by Burnes and Jackson (2004).
Overall composite narrative, top management group
The top management subgroup perceives the previous working methodology as hard. Current organizational climate and role of management are perceived as soft, therefore the expected working methodology, organizational climate and role of management will be a continuation of the current situation (soft). The change approach is perceived to be effective due to a mix of bottom-up and top-down initiatives (mixed)
Figure 21: Composite narrative of the top management business subgroup Overall composite narrative, middle management group
The current working methodology, organizational climate and role of management are perceived to be a combination of hard and soft aspects, thus the perception is mixed, leading to feelings of uncertainty and ambiguity. They desire more soft aspects to be implemented. Those that already started to implement the new working methodology perceive the change approach as bottom-up (soft). Those that did not, view the change approach as top-down (hard) and are more sceptical about the change
Figure 22: Composite narrative of the middle management business subgroup Overall composite narrative, employee group
expected working methodology, organizational climate and role of management are perceived as soft. Those that already work according to the new working methodology perceive the change approach as bottom-up (soft). Those that do not, view the change approach as top-down (hard) and are more sceptical about the change. They want to be more involved by the top management group
Figure 23: Composite narrative of the employee business subgroup Overall composite narrative, IT group
The current working methodology, organizational climate and current role of management are described with a soft narrative, due to already having implemented the change. As a result, this group does not expect massive changes in their working methodology, organizational climate and expected role of management (soft). They are not as involved as the business group in the change approach and only their top managers take an active role in it.
Figure 24: Composite narrative of the IT group
Overall composite narrative, Outer group
The current working methodology, organizational climate and current role of management are perceived as hard. The future working situation, expected organizational climate and future role of management are expected to be soft. However the group perceives the change approach as top-down (hard) and that this is not in line with the values of the change (soft), leading to scepticism regarding the change success and feelings of a lack of involvement. Figure 25: Composite narrative of the outer group
