Concepts of leadership and management and their application in an organizational, social, environmental and multicultural context

Customer behavior and technological changes leave a big effect on the operation process of the banking industry. It is often difficult for the banking sectors to cope up with the changing customer behavior and the technological emergence (Jayawardhena and Foley 2000). As per the given scenario, it has been found that the irreversible changes in the customer behavior and the technology affect the current shape and operation model of the banking industry. Therefore, it is difficult for this industry to sustain their present business model for future (Oliver 2014). The effect of changing customer behavior and technology on banking industry are discussed below through the force field analysis process. In this process, 30 managers from different baking sectors of UK are taken to collect data. The questionnaires are given below:

Q1. How far do you agree that a technological change is necessary for the banking industry to get competitive advantages?

Types	Total number of participants	Respondents Save Time On Research and Writing Hire a Pro to Write You a 100% Plagiarism-Free Paper. Get My Paper	Percentage (%)
Strongly agree	30	5	16.66
Agree	30	10	33.33
Neutral	30	0	0
Strongly disagree	30	4	13.33
Disagree	30	6	20

 

Table 1: Importance of technological change in banking industry

(Source: Author)

Critical analysis: From the above data it has been found that 33% of total participants agreed that technological change is significant for the banking industry. However, it has been received from the different research studies that technological innovation enables the banking industry to make their operation process fast, which reduces the workforce (Webb and Martin 2017). On the other hand, every business industry focuses on the fast operation process, which can be done through technological innovation. Thus, banking industry requires technological innovation to improve their operating process. On the other hand, 20% of the total respondents disagreed with this viewpoint as technological innovation often leads the banking sector to face high cost as they need to hire more technical experts.

Q2. How far do you agree that customer behavior is affecting the current operation of banking industry?

Types	Total number of participants	Respondents	Percentage
Strongly agree	30	4	13.33
Agree	30	16	53.33
Neutral	30	2	6.66
Strongly disagree	30	3	10
Disagree	30	5	16.66

Table 2: effect of changing consumer behavior in banking industry

(Source: Author)

Critical analysis: According to the above table 535 of the total candidates agreed that changing customer behavior affects the current system of the banking sector. According to the given scenario, it has been found sustainability of the current business structure is hampered due to the rapid changes in technology and consumer behavior. As argued by Frame and White (2014), in order to meet the changing demand of the consumers the banking industry failed to retain their existing structure. On the other hand, in order to gain competitive advantages, they need to meet the consumer demand, which leads them to adopt the new system in their operation. This often increases complexity in the system. Despite this 16% of the participants were disagreed with the negative impact of consumer behavior on operation process of the banking sector.

Evaluating organizational policies and HR strategies with overall business strategy

Q3. What are the major impacts of changing customer behavior and technology in banking industry?

Types	Total number of participants	Respondents	Percentage
Introduction of new product	30	5	16.66
High cost	30	10	33.33
Implementation of new system such as network banking	30	3	10
Changes in the current structure	30	12	40

Table 3: Major impacts of changing consumer behavior and technology on banking sector

(Source: Author)

Analysis: According to the current data it has been found that 33% of total respondents said that high cost of the operation process is one of the major impacts of changing customer behavior and rapid technology on banking industry. On the other hand, 40% of total participants revealed that rapid changes in technology and consumer behavior bring change in the existing structure and operation model of the banking industry, which is not good for the organization. A change in the existing system is vital for an organization to improve their structure while technological changes often modify the entire system. As a result, employees face problem to cope up with the new system (DeAngelo and Stulz 2015). On contrary, 16% of total participants agreed that changing consumer behavior and new technology lead banking sector to introduce a new product in their organization.

Q4. How far do you agree that changing technology and customer behavior will be beneficial for bringing innovation in banking industry?

Types	Total number of participants	Respondents	Percentage
Strongly agree	30	3	10
Agree	30	11	36.66
Neutral	30	2	6.66
Strongly disagree	30	4	13.33
Disagree	30	10	33.33

Table 4: Benefits of changing technology and consumer behavior on banking sector

(Source: Author)

Analysis: According to the above tabular format is has been found 36% of total participants stated that changing technology and consumer behavior are beneficial for banking industry as it allows the industry to bring innovation by introducing new product or service. On the other hand, 33% of total candidates disagreed with that concept. From this analysis it can be evaluated that changing customer behavior and technology have both positive and negative impact on banking industry. As opined by Egan et al. (2017), if banking industry is able to restructure their operation process successfully then they will be able to cope up with changing technology and customer behavior. On the other hand, if banking sector fails to incorporate the technological changes in their system properly then it can affect their operation process.

Q5. How far do you agree that rapid changes in technology and customer behavior have a negative impact on the sustainability of banking industry?

Types	Total number of participants	Respondents	Percentage
Strongly agree	30	8	26.66
Agree	30	10	33.33
Neutral	30	1	3.33
Strongly disagree	30	4	13.33
Disagree	30	7	23.33

Table 5: Impact of rapid technology and changing attitude of the customers on the sustainability of banking sector

(Source: Author)

Analysis: From the above data it has been received that majority of total respondents agreed that rapid changes in consumer behavior and technology hamper the future sustainability of the existing system in banking sector. Sustainability can be achieved by keeping an existing system in future (Webb and Martin 2017).  If continuity of a system breaks then it is difficult for an organization to maintain the sustainability of such system. Such data also support the fact, which is mentioned in the given scenario. Despite this 23% of total candidates are disagreed with the negative effect of changing technology and customer attitude on banking sector. From the entire data, it can be said that rapid changes in technology and consumer attitude have both positive and negative effect on banking sector. The major negative effect is declining of the sustainability of current operating system in banking sector.

Developing change management strategies to gain competitive advantage

Action research is a process to solve any problem that may occur in any business industry. However, action research is involved in bringing changes in a system (McNiff 2016). However, action research helps an organization to identify their current issue and then take action based on such issue. Through the implementation of action research process, the management of an organization can detect the problem based on the gathered data. Action research enables an organization to take necessary and quick action based on the current problems. Therefore, it is involved in changing the environment of an organization. Action research is an action based research. By using this tool an organization is able to develop necessary action based on the research data. This tool is used to deal with the critical situation in an organization. As per the given scenario, it has been received that the banking industry has been facing rapid changes in technology and the consumer behavior. This affects the sustainability of their existing system.

Implementation of the action research can be done by using a seven steps method. At the first step, the banking sector needs to select a focus to identify their major problem. In the next step of action, research implementation identification of the values of this method should be done. In the next step preparation of the research question needs to be done to collect data regarding the current problem. In fourth and fifth stage the data will be collected and analyzed. In sixth stage, the report is prepared and in seventh stage, necessary action is taken to resolve the problem ((Mertler 2016).

As for example, CAF Bank Ltd faced challenges due to the high cost of network banking or e-banking and the insecurity of this system (Cafonline.org 2018). However, the maintenance cost of the sophisticated software and training of the employees is high. Hence, application of action research is helpful for this bank to identify the exact issue and take necessary action to reduce it. CAF Bank Ltd focused on action-based research tool and they have identified the reason for their high operation cost due to the maintenance of e-banking. They have implemented this method by gathering data from the customers and the employees regarding the advantage and disadvantage of e-banking. Based on this problem they have hired more technical staffs to ensure the security of e-banking. This action helped them to reduce the training cost as they have hired technical staffs who have no requirement of any training.

References

Cafonline.org. (2018). CAF Bank Ltd.. [online] Available at: https://www.cafonline.org/about-us/about-caf-bank [Accessed 16 Mar. 2018].

DeAngelo, H. and Stulz, R.M., 2015. Liquid-claim production, risk management, and bank capital structure: Why high leverage is optimal for banks. Journal of Financial Economics, 116(2), pp.219-236.

Egan, M., Hortaçsu, A. and Matvos, G., 2017. Deposit competition and financial fragility: Evidence from the us banking sector. American Economic Review, 107(1), pp.169-216.

Frame, W.S. and White, L.J., 2014. Technological change, financial innovation, and diffusion in banking. The oxford handbook of banking, p.271.

Jayawardhena, C. and Foley, P., 2000. Changes in the banking sector–the case of Internet banking in the UK. Internet Research, 10(1), pp.19-31.

McNiff, J., 2016. You and your action research project. Routledge.

Mertler, C.A., 2016. Action research: Improving schools and empowering educators. Sage Publications.

Oliver, R.L., 2014. Satisfaction: A behavioral perspective on the consumer. Routledge.

Webb, I. and Martin, G., 2017. The effect of banking and insurance on the growth of capital and output.