Management Research Paper: Bancolombia

Bancolombia
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Table of Contents TOC \o "1-3" \h \z \u Introduction PAGEREF _Toc60951580 \h 3Human resource issue PAGEREF _Toc60951581 \h 3Alternative solutions PAGEREF _Toc60951582 \h 4Recommendation PAGEREF _Toc60951583 \h 6Action plan PAGEREF _Toc60951584 \h 8Financial analysis PAGEREF _Toc60951585 \h 11References PAGEREF _Toc60951586 \h 13
Introduction
In the competitive business environment, organizations merge to achieve a competitive edge and attain potential growth of the business. Merged businesses such as Grupo Bancolombia enjoys increased market share, economies of scale, and increased profitability compared to individual firms. On the flip side, mergers often encounter numerous challenges like exogenous risks, loss of trust among vital stakeholders, assessing corporate cultures, communicating the mergers' reasons to employees, and comparing benefits, compensation, union contracts, and deciding on human resource policies and practices to adopt.
Human resource issue
This case study demonstrates vital human resource practices, including employee satisfaction, resourcing, integration, training and development, HR planning, teamwork, employee retention and compensation, job security, job design, and communication. These practices need to be stressed as they play a vital role in the success of the business. The practices are essential in the operational efficiency of the Grupo Bancolombia. For instance, employee satisfaction is crucial for Bancolombia and defines their productivity and performance.
Grupo Bancolombia is faced with the great challenge of integrating the different organizational cultures of the three individual firms (Bancolombia, Conavi, and Corfinsura). Typically the merged organization aspires to adapt to the new culture and embrace the new communication model. With this in mind, Grupo Bancolombia hopes to transform the three independent entities into a collective company with the same mission, vision, goals, and objectives. However, these results are not easily achieved as the merger encounters numerous problems, including loss of customers due to delays in assistance and the failure of the current employees to navigate the new operating system. These problems need to be addressed with speed as they can lead to poor performance from employees, negative customer perception, and financial costs in the future years. For instance, Conavi customers feel the effect of the new operating systems that have led to increased waiting times, needless to mention the increased confusion compared to the previous systems that were fast and friendly.
Grupo Bancolombia should focus on enhancing the benefits of the operational system, redesigning and re-implementing the organization's culture, and developing effective human resources strategies that ensure appropriate transition among the employees. It should also create more opportunities for the existing workforce to participate, advance, and contribute their knowledge in improving business performances. Although the Grupo Bancolombia merger make good financial sense, employees and customers of the merging firms often show signs of fear concerning their new roles in the newly formed organization. This is evident among employees in the three firms who are in fear of possible job loss.
Frequently, a merger's have significant impact on employee productivity, performance, and attitude often move from hopefulness and enthusiasm to uncertainty and resentment. With this in mind, if the human resource issues in the Grupo Bancolombia are not well managed, employees will continue to experience anger, conflicts, stress, and integration issues that hamper their performance and productivity. Therefore, to avoid future failures of the business and realize the goals and objectives, Grupo Bancolombia needs to address these challenges.
Alternative solutions
Grupo Bancolombia merger brings different sectors, including personal banking (Bancolombia), corporate banking (Corfinsura), and mortgages (Conavi), under one service. As such, employees who move to the newly merged organization need to be trained on new products. For instance, Conavi employees need to be trained on personal banking and corporate banking, while Bancolombia employees need training on mortgages. Training and development will help familiarize employees with effective practices and address potential challenges that pose a significant threat to the organization. For example, employees from all firms require training on different product portfolios.
Training will allow the employees to increase their confidence and offer them a chance to evaluate old policies and take the strengths of new ideas and assimilate them into the new business model. Unfortunately, training can waste valuable time and resources, which organizations may use to hire other people. Similarly, lack of interest and negative perceptions among employees may hamper training and development programs' effectiveness. Naturally, training and development causes increased stress on employees, especially when dealing with sophisticated procedures and systems.
On the other hand, cultural transformation workshops is another effective strategy in ensuring successful cultural integration between three individual firms that form the Grupo Bancolombia. That is, the three firms possess different cultures in the way they conduct their operations. Unless the three cultures are merged to create one culture with the same values and principles, the merger will not achieve its desired results. Cultural transformation workshops will enhance organizational behavior, synergize teamwork skills between different cultures, and create a new vision for employees for every management level. Workshops play a vital role in empowering employees as well as keep them empowered all through.
Even with their effectiveness in enhancing cultural integration, cultural transformation workshops face employees’ resistance. Ordinarily, culture is deep-rooted in beliefs and values, and changing them can create friction and cause employees to resist change. On the same note, these workshops do not focus on performance since they emphasize cultural differences. In worst-case scenarios, trying to teach new values to employees can backfire and fail.
Employee Recognition Program is another technique Grupo Bancolombia can implement to improve employee morale, increase competitiveness, attract and retain employees, elevate productivity and employee performance. This technique enhances employees' values by ensuring that they feel more appreciated and valued by the organization. For instance, the Grupo Bancolombia merger brings employees from three companies who have different principles and values. That is, while Bancolombia is more result-oriented, Conavi emphasizes healthy relationships between different stakeholders.
As such, Grupo Bancolombia needs to motivate every employee to tap into their unique knowledge and expertise. However, a wrong employee recognition method may destroy dedicated employees’ motivation. Similarly, it can be expensive to recognize each employee regularly. If not well implemented, an employee recognition program may lead to favoritism and division among employees who are consistently recognized with those who are less appreciated.
Recommendation
Many mergers are usually formed based on financial performances and often neglect the human factor. For instance, in this case study, the undesired results of Grupo Bancolombia are associated with the disregard of the human element. That is, each of the three entities has its unique corporate culture and values that employees need to shelve and integrate the new culture. The recommended solution described below aims at achieving efficiency and enhance cultural integration among the employees.
Cultural transformation workshops are the most effective solution to address the underlying human resource problem. As noted in the Grupo Bancolombia case, mergers create vast organizational anxiety on the organization's existence. The changes and concerns go far beyond the senior leadership and employees and challenge the core of a company’s identity, day-to-day operations, and purpose. Therefore, addres...