Organizational Behavior and Change Management
Organization culture defines the organizational belief and attitude in the way goals and objectives are accomplished.An organization is shaped by the culture that predominates in work environment, employee behaviour and managerial attitude.However, in face of rapidly changing business requirements and market trends organizations are now implementing fresh strategies that improve the work environment and organizational culture to promote higher level of motivation and employee productivity.
The paper analyses this trend in the context of Injazat Data Systems, an IT and business process outsourcing service provider.
The paper researches the changes that have taken place in the organizational culture over the past few years to meet the challenges of the industry and promote work performance. The paper analyses the existing company practices and managerial policies and how it impacts employee performance and attitude to work. Based on these findings the paper draws up a plan that can help the organization overcome these limitations and incorporate new strategies to achieve high levels of performance. The paper also provides an insight into how these changes will be implemented drawing up a change management plan to this effect.
“Today’s business environment is characterized by an ever increasing volume of information, mounting regulatory and legislative pressures, disparate databases of information and a demand for cost reduction and efficiencies. ” In an attempt to meet the challenges of rapidly changing business environment IT companies and service providers are re-engineering their business processes to adapt to market trends and facilitate a consistent growth model. The outsourcing industry has initiated widespread changes in the way public, private, or government agencies are functioning.
“The new developments in technology are challenging e-government strategies to focus on innovation and creativity, as an excellent infrastructure of online service builds an e-society and improves governance. ” The Middle Eastern region in the past few years is experiencing widespread economic reforms and transformation that is largely driven by capital surplus, infrastructural development and growth of new industries like outsourcing.
2. Research Methodology
The paper analyses the outsourcing industry in the Middle East focusing on the organizational structure, culture and systems implemented within Injazat Data Systems.
It discusses the efforts of the management in incorporating innovative practices and work culture. The research is based on the use of secondary sources of information using company website, various online journals and articles on management practices and outsourcing industry facts.
3. Organizational Background
- a) Outsourcing industry: a background The business and commercial environment has witnessed widespread changes owing to globalization of economies and liberalization of international trade.
Technology has been a great enabler of change and business enterprises are changing strategies to adopt the innovative methods of production and management of resources. The growing popularity and use of the Internet and e-commerce has triggered entrepreneurs to redefine their business strategies in search of cost advantage and efficient management of work processes. The emergence and growth of the IT industry is a consequence of rapidly advancing technology and outsourcing of work processes is one of its offshoots.
“The digital revolution and the dramatic fall in international telecommunication costs have created unparalleled opportunities for businesses to take advantage of high skilled, low wage workers in emerging countries. ” Organizations are rapidly adopting the concept of transferring work processes to external parties in pursuit of low cost of operations and efficient handling of resources. The essential advantage that this strategic concept provides is the opportunity to cut costs and boost productivity.
The outsourcing industry in the Middle East region reports a compound annual growth rate of 16 percent in the year 2005 with a total market share of $91 million. “The top 10 players control 75 percent of the IT services market, but opportunities are still available in sub contracting, the SME sector, and training. ” Figure 1 – Saudi IT Services Market Overview (Source: citc. gov. sa, 2005)
- b) Injazat Data Systems – Company background Injazat Data Systems is a IT and business process outsourcing service provider specializing in IT support functions, business consultancy and outsourcing of work processes.
The company is a joint venture between Mubadala Development Company with 60 percent stake and Electronic Data Systems (EDS) with 40 percent stake. Mubadala Development Company has its origin in Abu Dhabi while EDS is a leading global technology service provider of Hewlett Packard having more than 40 years of experience in handling outsourcing services in various industrial sectors. The company has its headquarters in Abu Dhabi. In a time span of just 2 years, Injazat Data Systems has won contracts worth more than AED 1. 3 billion and has a strong team of nearly 600 professionals.
35 percent of the employees are UAE nationals and the company provides IT enabled services to an increasing number of companies in the public and private sectors. The company currently has a market share of more than 50 percent of the UAE’s IT enabled services market and is the developer of the region’s first data center. Product and Services The company offers comprehensive solutions to IT support and infrastructural areas in addition to business consultancy and outsourcing services. The services offered by the company include the following categories:
- IT supports services – that include data centre services, networking services, IT security applications, and office computer maintenance services.
- Consulting – that includes strategy development, enterprise architecture and change management to government sectors, defence and security sector, logistics, information technology and finance sectors.
- Business Process Outsourcing services
- Customised applications – develop and integrate software packages, customer relationship management solutions, enterprise application management solutions, and global testing services.
- Project Management services that include project management, program management, quality management, and portfolio management.
Operating Market Injazat Data Systems is based in Abu Dhabi and provides services primarily to the Government agencies in the Middle East. Some of its prominent clients include government agencies of Abu Dhabi, Abu Dhabi Water and Electricity Authority, MDC, Dolphin Energy of UAE, Environment Agency, Abu Dhabi Ports, Abu Dhabi Council for Economic Development, Defence and Department of Finance.
- c) Vision The company’s vision statement reflects its business objectives and purpose for its existence.
“To be recognized as the PREMIER Information Technology and Business Process Services partner in the Middle East.”
- d) Mission The Mission statement of a company defines its scope of services and objectives that it serves to fulfill in the given industry. “To provide quality professional Information Technology and business process services that adds value to our client’s businesses. We will deliver these services through highly committed and motivated teams using innovative thinking and best practices. ”
- e) My department and its role
The primary role of the business research and development department is to develop clients, maintain client relations and analyse market conditions that can be used for formulating market expansion strategies and value addition services to existing client base. The business research and development department also analyses the internal work conditions and culture.
- f) My role in the department I work as a business consultant in the department and my scope of services include identifying strategies that can promote better work culture, increase productivity, and enhance performance through improved employee morale and work environment.
Organization structure consists of decisions about formal structures, processes, systems, roles and responsibilities. The organization design takes into account the reporting lines, methods of communication, procedures for making decisions and solving system problems, rules or guidelines for the conduct of employees and a system of rewarding achievement of goals and targets. Based on the type of organization design there are three types of organizational structures that include highly centralized or vertical structure, moderately centralized and decentralized structures.
Injazat Data Systems has a highly centralized form of organizational structure where the top management takes all decisions with various departments reporting to the top management. This form of organizational structure proves to be more authoritative and hierarchical in nature. “The vertical organizational structure is reinforced by centrifugal forces that create decentralization and locate governance, responsibility, and resources peripherally, rather than centrally. ” However, this form of organizational structure leads to bureaucratic control over all managerial and operational decision making process.
Changing business environment and market trends have triggered the need for change in this hierarchical organizational structure. The organization now has various department heads who are accountable for overall planning, organizing and execution of work processes for their respective departments. The decentralization of reporting lines have created more efficiency since this form of structure promotes expertise in the specific field of operation. The mission and vision statement of the company is applicable to individual departments who translate the goals specific to their respective departments.
The significance of the company vision statement lies in its role in providing the employees with a strong sense of belief in the company they work for and the ideals it represents. It is imperative that employees identify with the company goals and objectives and effective leadership is displayed in communicating and creating a strong belief in the company objectives among the workforce. In order to induce a strong belief in the company goals, the leaders need to believe in these objectives foremost. The management and leaders within the organization face the crucial task of building a shared vision.
An effective leader is successful in articulating these goals and objectives in clear practical terms that the employees can easily relate to. 4) Internal Analysis The parent company Mubadala Development Company (MDC) is the project finance and investment agency of the Abu Dhabi government. MDC awarded a tender project to Electronic Data Systems, a global consulting company. The tender project was to develop a local company that will look into the outsourcing business in the Middle East. MDC realized this as an opportunity to trigger the growth of outsourcing industry in the region.
MDC formed a joint venture with EDS to form Injazat Data Systems. The joint venture of the finance and investment company with a global business process outsourcing service provider was a major step in adopting innovative technology to propel company growth and enhance revenue models. The company’s foray into the outsourcing industry segment can be analyzed using the 7 “S” models. Strategy refers to the vision and objectives of the company and the pattern of communication it adopts to implement and incorporate the changes in its vision and objectives.
Injazat Data Systems has adopted a transparent policy while communicating core business values and company objectives to be met in the short term and long term. Company directives are clearly stated in the employee handbook and employees have to undergo a 3-day induction program where they are provided information on company rules, policies and expectations. The operational training provided to the employees prepares them to meet the challenges at the process level. Structure refers to the organization chart and the inter-connection between various departments and levels within the company.
Injazat adopts a hierarchical form of organization structure that has vertical reporting lines. The organizational structure determines the flow of information between various levels and helps in defining the employee accountability and responsibility that has a direct implication on the efficiency of the company and its work processes. Systems refer to the procedures and flow of information within departments and levels of management. Injazat having a vertical organization structure has a centralized form of control and this implies that all important business decisions are made by the top management.
Staff refers to the various types of personnel and departments existing within the company. Injazat Data Systems operates in teams and groups of professionals who specialize in different work processes within the company. Besides the IT professionals and key teams operating in specialized areas the company has a human resource department, finance department, a business development unit and a training department that is responsible for the conducting in-house training programs and workshops for the employees on a regular basis.
Style refers to the way the employees and managers are expected to behave in order to meet the company goals and objectives. During the induction program the employees of Injazat Data Systems are provided a handbook that contains details on employee conduct and behavior within the office premises. The data protection rules attached to the outsourcing industry is also a part of employee conduct. Skills refer to the range of services provided by the company and how it strives to maintain its core competency.
The outsourcing industry requires a lot of dynamism in the face of rapidly changing business demands. Injazat Data Systems provide a host of business consultancy and outsourcing services to all kinds of business needs. In order to maintain high quality work delivery and performance the company hires well trained and qualified people. The employees are also provided in-house training based on various aspects of work processes and operational requirements.