UNIVERSITY OF HULL

MASTER OF BUSINESS ADMINISTRATION

ORGANISATIONAL BEHAVIOUR

GROUP ASSIGNMENT
A CASE STUDY ON BARCLAYS BANK

REPORT WRITTEN BY
ABIEYUWA AIWERIOGHENE MMQ008FN
GHAZHALA RASHEED MFQ011FN
MANU MOHANDAS MMQ024FN
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 CONTENTS
Page Number
INTRODUCTION

• Barclays Case 3

LEADERSHIP 4

• Customers 5

• Community 5

• Environment 5

• Market Place 5

• Work Place 5

ORGANISATIONAL CULTURE AND CHANGE 7

• Definition and application to Barclays 8

• Organisational Culture theories 8

CHANGE MANAGEMENT 10

TEAM MANAGEMENT 13

CONCLUSION 15

RECOMMENDATIONS 15

BIBILIOGRAPHY 16

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Introduction

The business environment is rapidly changing and organisations cannot afford not to make
changes as they will be left behind in the business world. Economics dictates change and stress the
need for businesses to be innovative in order to be successful in their various fields.
Any attempt by management of an organisation to enhance the productivity of services/goods serving
a single team is called change. Current globalisation war of business has brought a revolutionary
change in organisational management in producing, maintaining and delivering goods and services.
Organisational designer admits change as a fact of life. (Organisational Behaviour, 1996)

Barclays is one of the largest financial services group in the UK engaged primarily in banking,
investment banking and asset management. To study Barclays organisational behaviour, we took a
look at their past and current position that is their culture which can be defined as the invincible force
behind their organisation. Change has occurred in this organisation and a need for further change has
been identified whilst applying a number of relevant theories.

The bank delivered a strong financial performance in 2003. Their profit before tax was up by
20% as compared to the previous years. This success was achieved by the bank’s adoption of the
stretching and publicly stating goals which had a positive impact on Barclays’ financial performance,
creating focus and energy.

The banks concentrated in making changes in areas like:

1. Setting realistic goals
2. Better and more effective leadership and management
3. Motivation of staff and team work
4. Fostering of better customer relationship

The aim of this study is to analyse the current organisational behaviour of Barclays bank with the
help of theories like organisational culture, change management, team management, leadership etc. A

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look will be taken into the future of this group having in mind the future strategies mapped out by the
bank.

Leadership

This is an important aspect of business success in today’s world. Leadership can be defined as
the ability to influence people towards the attainment of goals. (The future of Leadership, Randall,
Philip and Stuart, 1996)

In today’s rapidly changing environment leaders play a vital role in business. The leaders create
a shared vision for the organization about the desired performance outcomes, how it will look like and
underlying the values and most importantly this vision should be understood by the employees.
Leaders should be able to ensure that there is a good system of communication where information
flows freely and easily to the various departments in an organisation. This is important as bad
communication system could lead to the fall of an organisation.

Leaders must be dedicated to the visions of the organisations they serve. Three styles have been
identified. These are:
a. The authoritarian or autocratic style, where power is solely with the leader. The leader
alone makes decisions and has the authority to determine policy and procedure.
b. The democratic style, where focus is more with the group as a whole. Every member has
a say in the decision making and policy making of the organisation.
c. The laissez-faire style, where members are given a free hand to do their work without
much interference. The leader only comes in when needed.
Kurt Lewin’s study compared democratic leaders with autocratic leaders and stated that the groups
who had democratic leaders have performed well even with the absence of their leader without
showing any sign of hostility.
Barclays lays a lot of emphasis on good leadership because it is their belief that it is the way to
take business forward. According to Barclays, Chief Executive, Matthew .W. Barrett has really made
a difference in the bank by reducing financial losses, developed new ideas, offers, and setting goals
and priorities. These new offers will not only give customers valuable benefits, but also offer help and
advice when needed. Thus the Barclays are to making life better for their customers.

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 This success was achieved by bank’s adoption of the democratic style of leadership led by the
Chief Executive of the bank. The staff, stakeholders and customers were carried along in every
process of change involved in by the bank. Thus the successful implementation of the bank’s change
plans which led to a number of policies like the break down of the barriers between customers and
their money.
Under the new and improved leadership, the focus of the bank in the following areas included;

Customers
• Helping to launch the Universal Banking initiative.
• Helping to develop and adopting the Equator Principles for the management of social and
environmental issues related to project finance.

Community
• Improving further the strong track record of getting employees involved with community
activities.

Environment
• The delivery of environmental performance improvement.

Marketplace
• The provision of funding, advice and access to basic financial services for the vulnerable and
financially excluded.

Workplace
• The raising and embedding of equality and diversity awareness throughout Barclays.
The leadership of Barclays realised and understood the resistance to change which usually
accompanies process of change in any organisation. Strategies were put in place to ensure that
their main goals were achieved. These strategies include;
a. Education and communication, with the hope of acceptance from the employees and other
stakeholders.

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 b. Participation and negotiation, by involving all affected by the change process, soliciting
suggestions and also involves the delegation of decision making.
c. Facilitation and support, by training and preparing employees, customers, shareholders etc for
the outcome which the change process will bring.
The successful management and implementation of change depends largely on the leadership of
an organisation. Communication is very vital and how this information is relayed to various groups
involved will determine the success of the change process of an organisation. The employees must
have trust in their leaders to succeed, as leaders have a duty of sustaining a healthy work climate, and
establishing appropriate and supportive organisational process.

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Organisational Culture and Change

Organisational culture is the collection of transactions, values, policies, beliefs and attitudes that
constitute a pervasive context for everything we do and think in an organisation. (Management and
organisational behaviour, Laurie Mullins, 5th Edition)

Culture can simply be defined as “how we do things around here”, and is reinforced through the
system of rites and rituals, patterns of communication, informal organisation, expected patterns of
behaviour and perceptions of psychological contract (Management and Organisational Behaviour,
Laurie Mullins, 5th, Edition)

A number of theories have being postulated in a bid to defining and describing organisational
culture. Charles Handy (cited Laurie Mullins 1996, pg 803-804) described 4 main types of
organisational cultures. These include:

1. Power Culture: This is commonly found in small entrepreneurial organisations. This form of
culture relies on trust, empathy and personal communication. It involves few rules and
procedures and hardly any form of bureaucracy is present.
2. Role culture: This is characterised by bureaucracy. There is control by procedures and rules.
In most casers the job is more important than the individuals.
3. Task culture: This is job or project oriented. This culture seeks to bring the right resources and
people together whilst utilising the unifying power of the group.
4. Person culture: The individual is the focus point. All existing structures are present to serve
the individual.
A look at the Barclays’ culture would reveal that the bank falls perfectly into the task culture
theory. This is evident from the fact that there is a pulling together of people from different
background and profession and other resources in order to achieve the aim of the company which
is success.

Different organisations have their own unique culture. These sometimes could be a mix of various
cultures. Another theory relevant to this analysis is the Peters and Waterman’s “The Culture
Excellence Approach”. This approach will be used to further understand the culture of Barclays. The

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bank also has features of the Role culture where things are done according to set rules and procedures.
Bureaucracy is also a major feature at the Barclays where the hierarchical style of leadership is still
present even though the change process is seen to reduce it hierarchy to the barest minimum.
Peter and Waterman identified eight basic attributes of excellence which are relevant to the
success of an organisation (cited Laurie Mullins, 1996 862-863). These include:

Bias for action

In emphasising their bias for action, Barclays strongly spells out business banking as their largest
single business. This shows their approach and bias towards business banking which is critical to
wealth generation and job creation in the UK.

Close to the customer

In their new management strategy Barclays’ top three priorities include delivering value to
customers through more integrated banking, improved productivity, and thus improved customer
service. In a bid to getting closer to their customers, Barclays claims to have improved the full range
of customer finance products.
Above all, the bank is ensuring that all their businesses are conducted in ethical, responsive and
responsible manners whilst focusing on operational efficiency and the development of a distinctive
customer service.

Productivity through people

Barclays lays emphasis on the development of talents so that the organisation is well led at all
levels. One of the most emphasised strategies of the company is the organisational fitness which
includes the human resources. Barclays plans include the ground breaking –new staff pension’s
scheme, review of current benefit package, and policies on age, introduction of sites for learning and
training across the UK. This will no doubt make the company an employer of choice.

They also offer work life balance to their employee that is maternity leave. Regular team meetings
and interactions are encouraged which aims at creating a conducive and relaxed environment for work
whilst achieving efficiency.

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Hands- on value driven
The bank has fully integrated The Woolwich. This has positioned them as a major player in the
mortgage market. Implementation of this strategy has shown that only progressive and effective plans
are being embarked on by the bank. This move by Barclays has delivered a good profit performance
from the mortgage business and the prospects for better mortgage deals are high.

Stick to the knitting

Barclays is one of the largest financial services groups in the UK. They engage primarily in
private banking and wealth management business. Their main focus is to harmonise service and
expertise towards building a stronger and more profitable business.

Autonomy and Entrepreneurship

Barclays in a bid to restructuring their business concentrated on their savings range products to
their customers. This change has led the bank to a leading position in the market for new savings
flow. The bank is restructuring itself to be a major player in the mortgage market by the full
integration of the Woolwich.

Simple form lean staff

Barclays in its strategies aims at making it easier for the customers to understand the products and
appreciate the services provided. They want not just consistency but clarity in their strategic
development and a stronger sense of accountability through out the bank.

Simultaneous loose – tight properties

This approach lays emphasis on the firm and free principles. Same value and beliefs are shared in the
organisation which leads to freedom and relaxed environment but at the same time everyone acting as
a check on themselves and others.

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Change Management

The Change

Change management requires the full range of managerial influence and control skills. Change is a
pervasive influence and an inescapable part of both social and organisational life. (Organisational
behaviour, 1996)
Culture change and performance improvements form part of the most common forms of change which
occur in an organisation.
To achieve a successful change process, a company needs to ask and provide solutions to questions
such as:
1. where has our organisation been
2. where is the organisation now
3. where are we going
It is safe to say that the future of an organisation is less determined by outside forces than it is by the
organisation’s history.
Barclays has made very drastic changes in the last 4years by adopting the stretching and publicly
stated goals strategy which had a very positive impact on their performance. They identified a need
for a change, after taking into consideration their performance in previous years. The bank used the
tried and tested formula of Kurt Lewin’s 3 steps of change process. These include:
1. Unfreezing the present value: Barclays identified the need for a change in their organisational
culture, by identifying the weaknesses and threats by conducting a SWOT analysis. This led to
the planning and adoption of a 4year goal period strategy which they called “the stretching and
publicly stated goals”. This strategy included the focus of the bank on areas like the market
place where the embracing of the diverse needs of customers was highlighted. Others included
the workplace where the raising and embedding of equality and diversity awareness
throughout the bank was emphasised.
Barclays also improved on the relationship they have with the community they operate in by
improving further their strong track record of getting employees involved with community activities
and investing 1% of UK pre-tax profit in community activity.
2. Moving to the new level: With the help of external consultants and internal staff, Barclays has
developed the out come of the change process and also carried out the implementation of

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 same. This was achieved through the well managed change process. This was successful
because Barclays recognised the resistance of change by its work force but employed
strategies which yielded very positive results, thus the good financial performance by the
bank. These strategies include :
• Educating & communicating the benefits of change.
• Participation and negotiation of its employees in the decision making process.
• Facilitation and support example staff training. This was highlighted in the statement
of the Group Chief Executive, where gratitude was been expressed to the employees
for a successful year end due to their involvement and support in the implementation of
the bank’s strategies.
3. Refreezing Change: this include Barclays efforts in stabilising the change already been made
to avoid stagnation and redundancy.
In a bid to maintaining and improving on the success already achieved by the company, they
have set another four goal plan starting from 2004-2007, where a number of plans have been
outlined. These plans are geared towards improving on the previous results by the bank.
Our findings showed that Barclays also adopted the Kotler’s eight step process to eliminate the
weakness in management. These steps are:

Establishing a sense of urgency- Barclays past result leads it to adoption of new changes.

Creating a guiding coalition- which is the full integration of Woolwich within the Barclays to widen
the mortgage market.

Developing a vision and strategy-which is development of a four years long term plan

Communicating the change vision- Barclays has reengineered its communication means to provide
relievable information regarding the new changes adopted by them

Empowering broad-based action- Barclays aim is to accelerate business growth, improve customer
relationship and experience, cost saving and risk management and investment in staff training.

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Generating short term wins- An increase in companies earning per share and profit after tax, reflects
positive effects of changes made by the company

Consolidating gains & producing more change- Barclays have been positively affected by changes
made, but they must keep up the change process. This can been seen from their proposed strategy
from 2004 to 2007

Anchoring new approaches in the culture- Barclays should apply strategies to business to be more
successful in market

By following the Kottler’s steps the new objectives of bank have been set.
• Making decisions to maximize the stakeholders’ capital
• Building a retailing business by providing higher service quality to customers
• Massive investment in providing information and delivery services to customers to create the
greatest value to them
• Introduction a new state of credit payment known as “Point of Sale”
• Presently, Barclays is offering free credit pensions
• Re-engineering of IT system
• Telephone Banking
• Partnership with community organisation
Barclays aim is building up close relationship with their customers. Barclays is committed to
improving the standard of service and developing genuinely rewarding and long-term relationships
with their customers.

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Team Management
Team management is the backbone and supplement of any organisation. The success and failure
of any organisation is wholly dependent of the decision made by the team

Charles Margerison and Dick Mc Cann (2000) describes team management’s work wheel as

Work Wheel of Team Management

Innovation

Advising
Promotion

Linking
Maintainin Developin
g g

Inspecting Organising

Producing

The successful implementation of change is dependent upon the willingness and effective

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management and co-operation of a team in an organisation. Attention must not only be given to the
change process but to the people who make up the team in an organisation.
Job simplification (Taylor F.W, Principals of Scientific Management, 1911) is the process of
breaking down the job, conversion of time consuming production procedures into time saving ones.
Barclays has invested hugely in staff training to enhance the team efficiency. In 2003 Barclays
successful decisions made by the team resulted in:
• Expansion of market and partnership with Woolwich.
• Stronger performance of personal financial services.
• Extension of open plan proposition which resulted spare head strategy to integrate the
banking services

Management Band Width; Addition of new directors and increase in management board.
Investing in the consumer facing people; by investing in providing training facilities to new
employees. (Barclays PLC, Summary Financial Statement 2003)

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Conclusion

In recent times Barclays’ performance has improved. They have to keep their hard work active
and that can gain them a lot in their competitive field. To maintain the good relationship with the
employees and the management the new culture will be of great help. The change in leadership has
turned out to be fruitful to them. The new management at Barclays has introduced new ideas and
techniques which employ various organisational theories like Kurt Lewin’s three step process of
change, the Culture excellence Approach of Peter and Waterman, Kotter’s 8 step process of change
etc.

The change cannot be activated with the help of theories alone but must be implemented from the
root level with the help of the employees. If they are resisting the various factors which can bring
down the business they can achieve good result. They should keep on the process of rectification even
after achieving short term goals and develop themselves in to a leading and successful banking
organisation.

Recommendations
Barclays has to advance with the current changes in the banking industry which is facing rapid
changes. They have to totally eradicate their hierarchical incompetence due to bad leadership, and
move forward to attain their goals. The management should continue to take corrective steps towards
keeping a good relationship with employees and customers, while involving everyone in their
workforce in future planning. They should emphasis on the uniqueness of their products and a
segmentation of the market.

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Bibliography

1. Robert H. Rosenfield and David C. Wilson. Managing Organizations.

2. Charles Handy 1999 Understanding Culture
3. Margerism C., Cann Mc D.,2000,Team Management
4. Randall P,White ,Philip Hodyson and Stuart Crainer 1996 The future of Leadership
5. Brown 1998 Organisational Culture
6. Taylor F.W 1911 Principles of Scientific Management.
7. Terkel S. 1972 Working, Wild wood House London.
8. Annual Review 2003 Barclays
9. Randolph W.A 1995 Navigating the Journey to Empowerment
10. Source Abbey national 2003 Interim Pre-Close statement
11. Precision marketing London: Oct31, 2003
12. Merrill lynch banking and insurance conference October 2003
13. Laurie J Mullins 1999 Management and Organisational Behaviour
14. The Economist
15. www.personal.barclays.co.uk
16. www.mi.co.ke/banking

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