Impact of Conflict and Negotiation on the Organizational Culture of HSBC - Research Paper

Introduction

The term organizational culture has broadly been used though it has continuously raised ambiguity. Most of the academicians refer to organizational culture as the prevailing conditions and practices developed by an organization around on how it handles its people and promote its values and beliefs (O'Donnell and Boyle, 2003, p.18). Riaz et al. (2014, p.1363) gives a more concise definition that entails the set of shared values as well as conventions that exists within an organization. It is a fundamental value necessary for effective performance of an institution (Naikal and Chandra 2013, p.17; Organizational Culture with example, 2013). The working definition for this particular entry will be the general way of doing things within an organizational setup. According to Nahavandi et al. (2013, p.338), conflict is referred to as a situation involving disagreeing parties over important issues resulting in friction. Such a collecting case is considered dysfunctional as stated by Frederick Taylor who defined conflict as a hindrance to the effective operation of the management which has dire consequences to the culture of the organization (Nahavandi et al., 2013, p.336). Some of the drawbacks of conflict can be reducing the focus of the employees on their designated duties as well as affect teamwork (Duerr eta l., 2018; Arditi et al., 2019, p.136; Marcoulides and Heck, 1993, p.209). The conflict management strategy settled upon is directly affected by the prevailing culture.

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On the other hand, culture also has a significant impact on the negotiation process. Conflict and negotiation had a far-reaching effect on the culture of an organization and more specifically THE Hong Kong and Shanghai Banking Corporation (HSBC). The various areas influenced by conflict management are in administrative units, general performance of the organization, and enhancement of individual skills and knowledge.

About HSBC

To sustain the trade balance between Europe and China, it was necessary to establish the Hong Kong and Shanghai Banking Corporation (HSBC) as necessitated by the increase in trade between the two nations. It has its headquarters in London and is the second largest banking institution in the world (O'Donnell and Boyle, 2003, p.38; Broadening perspectives, 2019; Kaivanto, 2015). HSBC its operations in approximately seventy-seven nations, the bank have set up about 10,000 offices. To ensure that t maintains its position among the top banks in the world, the institution resolved in establishing a strategic plan covering five years during the 1990s coined managing for value (O'Donnell and Boyle, 2003, p.38). To substantiate and operationalize the strategy, the organization came up with a culture change programme termed 'together we win.' the change was to enable HSBC to manage change and extends its dominance in the banking sector even in the twenty-first century. HSBC is among the world's largest organization that offers financial as well as banking services. It was established in the year 1865 (Wong, 2012, p.123).

The area of business of HSBC is based on financial services, for instance, commercial banking, investment banking, individual financial service, private banking and corporate and market investments. The primary objective of this institution is the generation of financial assets for the shareholders. the organizations have outstanding rules that govern the ethical conduct of the employees, finances environmental as well as community projects and strives to give back to the society within which it is situated. The stated objectives portray HSBC as a responsible multinational organization. The company has operational bases set out in Europe, the Americas, Turkey, the Asia-Pacific region, Africa, and the Middle East.

Organizational Culture at HSBC

The working environment at HSBC is based on public confidence as well as mutual trust. The employees are called upon to conduct themselves responsibly and fulfill their duties in the right manner. The core values that HSBC hold onto act as a guide to every employee in the way they work to act as well as how business is conducted with the customers (Employee Handbook (HBEU) HSBC UK, 2018, p.7). At the core of their operation are virtues such as integrity. Being an employee of HSBC requires that you command trust. To do so, a person is expected to be impartial as well as honest in his or her undertakings. The employee is not required to utilize confidential data to benefit himself or herself, is forbidden from participating in unethical conduct, dishonest, illegal and fraudulent act when it comes to financial activities. Additionally, the employee is required to put the interests of the customer before personal interest (Employee Handbook (HBEU) HSBC UK, 2018, p.7). According to Davies (2003, p.426), the Human resource works in partnership with the managers to strengthen the decision that is made.

Another core value at HSBC is fidelity. The definition of loyalty of an employee towards the customer and the bank as well goes beyond mere transactions with HSBC. It may entail acting responsibly in disseminating individual duties, securing all the information and data, restricting oneself from taking part in a business transaction that can be considered illegal, applying the confidentiality principle of every business transaction personal as well as financial affairs of the customers.

The employees are also called upon to exercise self-respect (Employee Handbook (HBEU) HSBC UK, 2018, p.8). Practicing professionalism while at work means that the worker should be actively conscious as well as straightforward during decision making. The definition goes further to include maintaining dignity and abstaining that of the co-workers. The employee should also cultivate the necessary skills that he or she is required to have to person the assigned duties as mandated. The worker should also embrace teamwork and make consultation form the colleagues especially in matters that demand professional judgment.

The corporate values that guide the everyday businesses of HSBC include accountability as well as transparency. in How the stakeholders conduct themselves give an overall reflection of the bank (Employee Handbook (HBEU) HSBC UK, 2018, p.8). To be transparent and accountable the workers should avoid conflicting circumstances and avoidance of misrepresentation of information and facts.

Explicit procedures and a comprehensive system of governance have been established by HSBC to ensure that the customers receive the support they require (HSBC Holdings plc. 2018, p.12). The senior level management is held accountable to the standards of the services rendered to the customers. Fundamental evaluation approaches are put in place to monitor the latter step which is congruent to the performance objectives of the organization. To enhance the customer relationship, HSBC has from time to time researched to strengthen its services as well as products and win back the trust of their customers (HSBC Holdings plc, 2018, p.12).

The products that HSBC offer are designed having the needs of the customers in mind. The customer centre frameworks used in the assessment of the price changes as well as the product.to reach a more satisfying solution, it is crucial that the culture of the customers is well understood. The team of employees developing the products have been equipped with relevant training and facilities. To offer adequate and standard training, HSBC has established the Product Management Academy that has trained many workers to ensure congruency in the design process that embed the needs of the customers in the solutions that are developed (HSBC Holdings plc, 2018, p.12).

Impact of Conflict and Negotiation on HSBC

According to Krolik (2014, p.26), the culture of HSBC, as well as the behavioral patterns of its employees, will most likely be dictated by the type of business the enterprise engages in, and for this came, it is financial undertaking. In aiming at achieving stabilization in the quest for realizing the market niche, an organization is likely to experience conflicting situations (Deshpande and Farley, 2004, p.3). Conflict of interest regarding HSBC refers to a case where an organization has a working relationship with HSBC, or its very employees become vulnerable to some influences. The competition is most likely to impact the decision-making process or the results during business associations. The causative agent of conflict can either be due to the contributory factor of legitimate influences, for instance, serving multiple clients, or the competition of harmful influences such as personal gain. Since the organization offers some services, it may from time to time find itself at a contradicting position with the interests of its clients and even sometimes with the obligations that are mandated to fulfill to its very clients. There are various levels of conflicts that can come up. They include a client against another client, HSBC and a client, an employee and a client, HSBC and an employee, a section of HSBC versus another part of the same organization.

To put the conflicting situations under control, HSBC has come up with ways of identifying, preventing and managing the conflicts. The attempts are in line with the present day theories of management that emphasizes on following a particular sequence of going through and solving conflicts as a prerequisite in the development of the organization (Krolik 2014, p.28). The established conflict principles are subjected to review on an annual basis. The laid out procedures aim at safeguarding the interests of HSBC's customers.

The organizational culture of HSBC is streamlined to deal with conflict by barring conducts that result in conflicting situations by not rewarding such behaviors (O'Donovan, 2007). How information flows from one employee to another is also dictated by the organizational culture of HSBC with the aim of protecting the interests of the customers. the organization has thus set in place specific procedures that identifies all the likely conflicts that is most probable to occur as it conducts its daily activities, keeps a record of the identified cases of disputes, preventing and management disagreements on a regular basis, make appropriate disclosure of the controversy where necessary, and finally keep a record of all cases of conflicts that the organization has been unable to deal with.

During identification of conflict, the organization's global businesses are supposed to put into consideration the likely conflict that applies to the type of services they offer and the activities they engage in. the organization put into account potential conflict during the development of new products, the business transfer from one section of the Group to another, and restructuring of revenue sharing arrangements. when the probable conflict include clients, the identification process considers whether the organization or an employee has a chance of accruing profits while putting the client in jeopardy, has significant concerns in the services that is being rendered to the client, is on the same side as the client is, is likely to affect the client's interest and whether the group or an employee is going to receive an incentive for the service provided from another party that does not involve the client. To keep track of the potential conflicts, HSBC keeps a record of all the documents, evaluations and internal registers concerning the conflict. In addition, the entries hold a record of how the potential conflicts can be mitigated. The senior management of HSBC conducts a regular update on the registers.

In order to prevent and manage the conflicts, HSBC formulates the r...