Digitalisation and changes in banking environment

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4 EMPIRICAL ANALYSIS AND RESULTS

As the aim of the thesis was to aim the characteristics of transformational leadership and how the digitalization is seen in the organization and in the banking sector, and how the digitalization is led in through the aspects of transformational leadership dimensions, a broad literature review was conducted and resulted in the identification of four leadership dimensions. The first section of the analysis is focused on Digitalisation and changes in banking sector, second Digitalisation and transformational leadership, and the third part is focusing on Digitalisation and transactional leadership.

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All the interviewees described digitalization and development in electronic channels as good and they saw them as an opportunity for both for customer experience and electronic service are seen also as a learning opportunity. It seems clear both for the employees and the leaders that banking environment is changing rapidly, and they are aware that their work is going to change and the current working routines are disappearing (Kauppalehti, 2017). The employees and leaders are ready to develop themselves and the working environment, these were factors also emphasized by the leaders. Moreover, the employees’ internal factors, such as autonomity, attitude towards new methods and flexibility to learn new working methods and use new electronical systems were considered essential in the digital transformation of the organization. Flexibility, ability to adapt into rapid changes in working methods and independent way to work were considered essential to cope changing organization. However, the changing role of the leader was also described especially in change process. The employees hoped that the supervisor would have been more present in adapting new methods, and also if in the organization there are issues or problems related technology, the supervisor or manager would quicly react problems. In the Group, there are a lot of discussion how the banking industry is changing and working methods are moving toward robotization and automatization, so everyone is preparing themselves for it. Especially the supervisors’s role is essential in digitalisation (Ilmarinen & Koskela, 2015, p. 235). In the Groups’

strategy was few years ago to invest in digitalization, and the strategy is conducted rapidly in the whole organizational level.

Even though digitalisation and new working methods were considered generally effective and beneficial for the company, some challenges were recognised through analysis. In the organizational culture’s point of view, the changes in characteristics of work were considered threatening One leader gave example on how employees are concerned of new digital systems whether they will work or not. One common belief towards digitalisation was also raised in the interviews, which was concerning whether the automatization would take everyone’s jobs and old personnel wouldn’t be needed anymore. The leader presented how this kind of thinking sets challenges in leadership, as leaders must think leading new attitudes towards digital services and provide enough information about changing working habits, so beliefs wouldn’t be major concern in the organization.

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In the Group, digital equipments and automatization are generally widely used, but in the short-term future, robotics and automatization are rapidly growing in different units and processes. This causes challenges in supervisor work, since the supervisors are coping with new technologies and working methods, and they have think new aspects in leadership. For example, they have to think robots’ operational readiness or the employees do not necessarily use new methods, since they don’t trust them. Beliefs and thoughts slower the digitalisation process (Koskela & Ilmarinen, 2015, p. 234). According to the authors, leader’s must recognize this kind of thinking, and it is also useful to recognize that in change the insecurity is related strongly. According to leader E, as she described challenges in employees’ attitudes. However, she describes these attitudes as great feature:

“For example, in my unit, there is situation that everybody is so concentious, people are so concentious, everybody are so damn concentious people and some are still in old practices, how can we harness that as a resource but not that way that people are still doing old practices. Or you can’t tell people that don’t be so concentious, being concentious is a good quality but we can’t be too concentious. Maybe these things are that are challenging, the beliefs challenge so much development of working habits. – These beliefs as you said that old inveterate working methods are difficult to change.”

Also, there are challenges in changing organizational culture. Banking sector has been considered more traditional, and especially in the ground floor office environment certain tasks have been stayed similar through out the years, and new methods and practices are considered to difficult to deployed into practice. In addition, developing new methods in the organization has certain routine how new systems are deployed into practice. New systems are tested in a small group for couple of weeks, and the testing group, or the “pilot group”, give comments and feedback how the system or practice is working and what needs to be done to improve system. Changes in the systems are made, if necessary, then the new practice or method will be deployed in the whole organization if the pilot was successful. This pilot system is a rapid way od testing new methods, and the comments are coming in real time from pilot group, and moreover, the new system can be rapidly taken into practice in the organization. As Ilmarinen & Koskela (2015, p. 197 and 201) states, rapidness to adapt, develop new methods and practices, and further testing and feedback, and changing new methods according these feedback are basic function in digitalisation. Moreover, the systematic

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“one step at the time” thinking adapting new practices are effective way to deploye practises in the organization. In the new practice, there are constant development and everyone gan give feedback and improve the method. However, when the practices are changing rapidly, and the employees must master the new practices in short time, the lack of time and short mentoring to the new systems were considered challenging. It also gave employees some level of insecurity when the handling new systems were certain and sometimes new methods were considered stressful when the employees must master the new systems and methods, but also to work according to objectives simultaneously.

As the Employee B described the instructions when moving new practice in organization:

“Well, the launching [of the new method] were quite sudden. First there was a small pilot in which I didn’t participated, but when it was broadened to everybody that new practice, we received written instructions which everyone must follow. And small orientiation, maybe one, two hour training for that so it was so fast-spaced that launching so the education for the new practice was rather low. – From the upper level came request, that we need to read the instructions, but there were no official working time for that. So the objectives and timetables and others were strict and then they announce that we have to read the instructions, so frankly, I haven’t still read the instructions entirely.”

Especially in these situations, presence of the supervisor was considered important and employees gave comments that they were hoping that supervisor would be more present and available. The employees understood that the supervisor has great deal of meetings and development duties, also that the supervisor was sometimes in the different city, but the employees felt lack of involvement and lack of support. As the leaders described their daily routines, great amount of working day was something else than traditional leadership, such as meetings, developing new services or methods, and they told that they wish that they would have more time for actual leading. Ilmarinen & Koskela (2015, p. 233) described that leadership in digitalisation, motivating personnel in the situations in which the organization is moving towards digitalisation, requires compromises, “reading” the followers and also listening and leading people in a way that make them work best way as possible.

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When asking the employees if they hoped that the supervisor was more present in the workplace, Employee B

“Surely these kind of changes when new modes of operations are taken into practice and such things, then you hope that supervisor were more present but otherwise I don’t feel that there are need for more.”

Employee A

“I like working independently, but in a way I am hoping that…that.. co-operation and interaction significantly more through feedback or setting goals.. or like going through general aspects.

Generally it is that we read instructions through e-mail and we start acting according to that, dependless on the issue.”

As the new electronic systems are considered beneficial and great opportunity, there are amount of electronic services which could be developed. The employees described some current electronic services byrocratic and old fashioned, and they were hoping that different authorities’ systems and services would discuss with each other, which would speed the work and make the work more fluent. As the digitalisation has developed through organization, there are huge amount of services and systems which could be developed in the organization, and overall in different organizations.