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2nd Assignment

OfMGT527: Organizational

Change and

Development

Case Study Analysis on LearningOrganizations

Case: ABN AMRO Bank

Submitted to:- Submitted

by:-

Lect, Maneet Kaur Mam, Ravish Kr. Bajra

BBA 6th SEM

Roll No: - RT1809A09

Reg.no:- 10808077

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Case Study: ABN AMRO Bank

Topic: Learning Organization

Organisational Learning vs. Learning Organisation

There is a difference between Organizational Learning and Learning Organisation.Argyris (1977) defines Organizational Learning as the process of "detection andcorrection of errors" while Senge (1990) defines Learning Organization as "a group ofpeople continually enhancing their capacity to create what they want to create". Hefurther remarks that "the rate at which organizations learn may become the only

sustainable source of competitive advantage". Ang & Joseph (1996) contrastOrganisational Learning and Learning Organisation in terms of process versusstructure.

Learning Organisation

A Learning Organisation is an organisation that learns and encourages learning amongits people in an effort to create a more knowledgeable and flexible workforce capable toadapt to cultural changes.

Some definitions:

The learning organisation is an organisation which facilitates the learning of allits members and continuously transforms itself" (Pedler et. al., 1989).

"Organisations where people continually expand their capacity to create theresults they truly desire, where new and expansive patterns of thinking arenurtured, where collective aspiration is set free, and where people are continuallylearning to learn together" (Peter Senge, 1990).

According to Sandra Kerka (1995) most conceptualisations of the learningorganisations seem to work on the assumption that learning is valuable,continuous, and most effective when shared and that every experience is an

opportunity to learn.

Learning Organisations Characteristics

The following are some common characteristics found in Learning Organisations:

Are adaptive to the external environment

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Continually enhance their capability to change and adaptation Develop collective as well as individual learning Embrace creative tension as a source of energy and renewal Foster inquiry and dialogue, making it safe for people to share openly and take

risks.

Link individual performance with organisational performance. Provide continuous learning opportunities. Use the results of learning to achieve better results. Use learning to reach their goals.

The basic rationale for such organisations is that in situations of rapid change onlythose that are flexible, adaptive and productive will excel. For this to happen, it isargued that organisations need to discover how to tap peoples commitment andcapacity to learn at all levels (Peter Senge, 1990) and that the pressure of change inthe external environments of organisations... is such that they need to learn moreconsciously, more systematically, and more quickly than they did in the past... they must

learn not only in order to survive but also to thrive in a world of ever increasing change(Pearn, 1997).

The key ingredient of the Learning Organisation is in how organisations process theirexperiences and how they learn from their experiences rather than being bound by theirpast experiences.

Learning Organisation Concepts

The major Learning Organisational concepts focus on Continuous Improvement,Culture and Innovation and Creativity.

Focus The concept of Learning Organisation Practices

1. Continuous

ImprovementA learning organisation should consciously

and intentionally devote to the facilitation of

individual learning in order to continuouslytransform the entire organisation and its

context

(Pedler et al. 1991)

The adoption of Total

Quality Management

practices

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2. Culture A learning organisation should be viewed as

a metaphor rather than a distinct type of

structure, whose employees learn conscious

communal processes for continuallygenerating, retaining and leveraging

individual and collective learning to improveperformance of the organisational system inways important to all stakeholders and by

monitoring and improving performance

(Drew & Smith, 1995)

Creation and

maintenance of

learning culture:

adopting to culturalchange, collaborative

team working,employeeempowerment and

involvement, etc.

3. Innovation and

Creativity

Organisation learning is the process by which

the organisation constantly questions existingproduct, process and system, identify

strategic position, apply various modes of

learning, and achieve sustained competitiveadvantage

Facilitation of

learning andknowledge creation;

focus on creative

quality and valueinnovation

The concept of organisational learning evolved from the individual learning process, butorganisational learning is not simply the collectively of individual learning processes, butit engages interaction between:

Individuals in the organization. Interaction between organizations as an entity. Interaction between the organization and its environment.

The Role of the Manager in the Learning Organisation

Senge (1990) argues that the role of the Manager in the Learning Organisation is that ofa designer, teacher, and steward who can build a shared vision and is responsible forlearning. The Manager is responsible for building organizations where people are

continually expanding their capabilities to shape their future.

Relationship between Strategy and Learning Organisation

Mintzberg (1987) says the key is not getting the right strategy but fostering strategic

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thinking. Learning should be embedded in any organisational strategy in order tosurvive.

The key ingredient of the Learning Organisation is in how organizations process theirmanagerial experiences. The ability of an organisation is not measured by what it knows

which is the product of learning, but rather by how it learns which is the process oflearning.

Case Study: ABN AMRO Bank

ABN AMRO An Introduction

Netherlands' former two largest banks Algemene Bank Nederland (ABN) andAmsterdam-Rotterdam Bank (AMRO) merged to form ABN AMRO Bank in 1991. ABNAMRO is an international bank with roots stretching back to 1824. ABN AMRO rankseighth in Europe and 13th in the world based on total assets. ABN AMRO is Hollandsleading bank operating over 800 offices in Holland together with 2,600 worldwide officesin 75 different countries with over 110,000 employees.

Concept 1: Continuous Improvement

A Learning Organisation

The ongoing success of ABN AMRO is attributed to its commitment towards employeelearning and personal development; learning is a major priority for the organisation.Being a dynamic and a fast growing organisation, there is the need for staff flexibility,

staff mobility and staff adaptation to new technologies, practices, situations andchallenges.

In order to support the personal development and career development of employees,ABN AMRO offer continuous learning programmes such as:

Job-related trainingo Induction programmes to help new employees integrate into the new work

environment.o In-house training seminars.

o In-house training programmes.

o External courses.o Coaching/mentoring programmes.

o Short term assignments in overseas offices.

Management programmes Leadership programmes

o e-Learning

o Products and Professional skills training

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Development Programmeso Structural talent management & succession planningo Management and leadership programmes

o Full range of training for new and diversified productso Internal mobility programme to encourage horizontal moves across

business units for more challenging roles and opportunities.

Learning is an investment and an ongoing process in ABN AMRO adding value both tothe organisation and to its employees.

e-learning

e-learning is a training channel which is effectively utilised by ABN AMRO. "We need tomake training accessible to people when and where they need it... Our multimediatraining is available in every city where we have people... Were very close toimplementing intranet-based systems to bring training to peoples desks" said Judi

Davenport, Director of Training (Aggressive training key to ABN AMRO acquisitionsuccess, Undated).

e-learning is an innovative learning solution and is the only way forward for a globalLearning Organisation such as ABN AMRO where staff is deployed worldwide.

Continuous improvement is achievable through the continued upgrading of theorganisational Total Quality Management practices as an ongoing learning experience.TQM can be achieved by having a knowledgeable workforce who continuously strivesfor self-improvement and through personal development for the benefit of both theorganisation and its employees.

Concept 2: Culture

Managing Cultural Change through Learning

One of ABN AMROs major strategies is the acquisition of Financial Institutions such asthe LaSalle National Bank and the Cragin Federal Bank in the USA. ABN AMRO is anactive Learning Organisation and has an aggressive program aimed to change thetraditional banking culture to meet todays challenges.

"Were going through so much change," says Director of Training Judi Davenport "that Ithink everybody realises we need to help people through that change... as people neednew skills and knowledge, we need to be there to give it to them and not let that happenby chance" (Aggressive training key to ABN AMRO acquisition success, Undated).

As part of the acquisition and restructuring process, ABN AMRO ensures that during thetransition of the merger of the new staff with the old staff no one will be left behind. All

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staff will be given equal opportunities and will be given all the necessary training toenhance their skills and personal development in an effort to adapt effortlessly to thenew culture and environment. This will ensure a smooth transition which ultimately willbenefit the organisation, its employees and its customers.

Change Community

ABN AMRO set up a community program referred to as The Change Community withthe purpose "to live, plant and support action at ABN AMRO towards more meaningfuland inspiring work/life." The community meet at regular intervals to engage in dialogueand reflection regarding issues of importance to the organisation and society such asdiversity, work-life balance, bringing individual values to work and sustainabledevelopment. Together, members exchange ideas and dilemmas with the intent tosupport the integration of sustainable development in the organisation.

This is another channel that ABN AMRO utilises in addressing its Learning Organisation

objectives. (ABN AMRO Change Community, Undated)

An Opportunity for Growth

ABN AMRO is always in search of reaching new heights by exploring new ways forbusiness growth and business development.

ABN AMRO has begun a new learning experience in its history. ABN AMRO incooperation with its new consortium partners Fortis, The Royal Bank of Scotland andSandanter, have joined theirexperiences to integrate and grow their businesses to their

full potential. The combination ofthe consortium businesses together with that ofABN AMRO should result in an enhanced market presence, strengthened products andgrowth prospects. This should also deliver benefits to customers who will gain from theincreased scale and efficiency of the businesses.

"Change is underway and we are in good shape to forge ahead" said Mark Fisher,Chairman of ABN AMRO Managing Board.

This is an outstanding opportunity for ABN AMRO bringing a new challenging learningexperience to the organisation. Sharing experiences with the consortium partners onceagain brings new knowledge and enhances the organisational culture.

ABN AMRO is clearly creating and maintaining its learning culture through theadaptation of cultural changes, through collaborative team work and through employeeempowerment by focusing on employee involvement as a work/life experience.

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Concept 3: Innovation & Creativity

Innovation and Creativity is a main pillar in any Learning Organisation. Innovation andCreativity will contribute towards potential increased efficiency in an organisation

provided that its employees learn quickly how to adapt themselves to new technologiesand innovations in an effort to position the organisation in a competitive edge.

Social and Environmental Innovative Sustainability- A core strategy at ABN AMRO

Sustained Social and Environmental causes form an integral part of ABN AMRO SocialResponsibility business strategy.

The bank strives to include a concern for social and environmental issues in its

decision-making and encourages other businesses to create benefit in society. Throughits lending practices, the bank seeks out and supports business activities that supportsocial or environmental causes. The innovativeness of this sustainability mindset hasled to numerous activities that are creating a shift in the impact of ABN AMRO on boththe environment and society.

"Because banks are a part of society, we want our activities to reflect the needs andproblems of that society," says ABN AMRO manager Lucian Toia.

ABN AMRO involves employees to practice and promote exceptional philanthropy. In2004, over 15,000 employees were involved in various initiatives around the world such

as the Akatu project in Brazil which is a program that builds environmental awareness.

Through this initiative ABN AMRO as a Learning Organisation is helping employeesenhance their knowledge and skills in areas which are not related to their line ofbusiness, brining new opportunities for personal development.

Worldwide Common Office Environment (COE) Deployment Project

ABN AMROs COE Wholesale Client Services business brought innovation and newpractices for over 3000 Traders in the organisation with the objective of streamliningcommon standards across its global business. This project impacted 10 different

countries being UK, US, Netherlands, France, Germany, Hong Kong, Singapore,Australia, Japan and New Zealand which are key to the ABN AMROs business.

The challenge was to provide user training with minimal impact on business operationsand without taking the user away from their desks for long periods of time.

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This task was entrusted to ILX Group which is a specialist provider of customisedtraining and implementation solutions and services with considerable experience in thefinancial sector.

ILX deployed a simple and unobtrusive global solution whereby users can self train with

a practical hands-on approach from their own PC through graphical step-by-step guidesand simple exercises.

This was a new learning experience for the organisation taking advantage of innovativetechnology as a Learning Organisation process.

High-tech Training Platform - Pathlore Learning Management Solution

ABN AMRO has partnered with Pathlore to deploy a learning management solution inits organisation. This solution enables employees to analyse their training needs and toreceive feedback on how to improve their performance. This solution also automates

many of the employee development activities handled by a bank's training departmentsuch as the registration of employees for training and the launching of courses. Thisgives the bank's training team an opportunity to concentrate more on the evaluation ofthe effectiveness of its programmes and to create new and strategic training initiativesrather than wasting its resources on Administrative tasks.

"The Pathlore learning management solution also handles the 'commodity activities'associated with getting people into training - things like logistics and registrations."added Pathlore CEO Steve Thomas. (Pathlore for high-tech training platform, 2004)

Again this solution engages the organisation in innovation, creativity and continuous

development as a Learning Organisation.

ABN AMRO Bank Introduces Service Innovations

Focus 2005 is a 5 year long-term plan with the objective of redesigning theorganisation for more effective customer service in an era where technologicaldevelopments such as the Internet are rapidly altering service requirements.

"With this initiative and our investment in information and communications technology,ABN AMRO Bank is further developing the successful formula of the integrated multi-channel concept," says Managing Board member Mr. Rijkman Groenink, who heads the

new European Division.The bank is investing considerably in InformationCommunication Technology giving the organisation a competitive edge.

ABN AMRO Implement Compliant Business Processes and Create a FlexibleUser Experience

ABN AMRO took the decision to change ABN AMRO Trust working practices in order tocreate a more agile enterprise by improving its customer service. The goal was to

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enable employees performing multiple tasks through a single interface together with acommon customer information database. This required an integrated approach to itstechnology, strategy and business processes, yet again bringing innovation and newlearning challenges to the organisation.

ABN AMRO opted for an IT solution named edgeConnect to reach its objectives throughwhich it was able to standardise its processes across each jurisdiction, providing eachuser with a consistent way of working, regardless of location, business function orbusiness role. This solution ensures that the proper ABN AMROs KYC procedures(Know-Your-Customer checks) are followed throughout the organisation. Furthermore,this technology provides advice to employees on whether a potential client should beaccepted or rejected thus enhancing the decision making process.

We could introduce more products to the existing client base with the same staff levelsbecause we could share information across ABN AMRO Trust as a single entity therebyremoving duplication of tasks, says Tony de Bree, former project manager, ABN AMRO

Trust.

Innovation and creativity is a pillar in a Learning Organisation and it is clear that ABNAMRO is second to none. Through innovative IT solutions ABN AMRO is facilitatinglearning and knowledge creation throughout the organisation.

Through the deployment of innovative solutions, ABN AMRO focuses on quality,creativity and value innovation. The deployment of new service innovations alsostreamlines common standards across its business in an effort to fulfil global and legalobligations.

Conclusion:

It is evident that ABN AMRO is a dynamic Learning Organisation which is always insearch of new opportunities for business growth. Living in an ever evolvingenvironment, organisations need to be pro-active, to anticipate change, to develop newideas and to manage resources with care. ABN AMRO recognises that its survivaldepends on continuous development and innovation and creativity which can only beachieved through a never ending learning experience. ABN AMRO is committed and isengaged in this Learning Organisation process and from the research carried out wecan conclude that ABN AMRO is:

Building its organisation fit for human beings Creating a capacity for self-transformation Developing an entrepreneurial spirit Encouraging autonomy Encouraging innovation Ensuring employee morale and satisfaction Facilitating change and adaptation

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Harnessing creative energy Increasing responsibility at all levels in the organisation Making work more enjoyable and productive Mobilising every ounce of intelligence in the workforce Producing more with less

Stimulating continuous improvement Striving for survival Switching on the brains of all employees Is in a Competitive Edge Using human talents to the full

all of which are characteristics of a Learning Organisation.

The main pillars of a Learning Organisation i.e. Continuous Improvement, Culture &Innovation and Creativity are a living monument in ABN AMRO Bank whichcontributes towards the organisations success, survival and potential future growth.