An Alternative Banking Inquiry: Exploring changes to banking culutre from the 1960s

Importance and Key Contribution The 1916 rising set in motion a chain of events that had a lasting effect not only on Irish society but also on the economy. The banking sector has, to this day, been influenced by these... [ view full abstract ]

Importance and Key Contribution

The 1916 rising set in motion a chain of events that had a lasting effect not only on Irish society but also on the economy. The banking sector has, to this day, been influenced by these events. Irish banks were traditionally mild mannered organisations with strict working regimes and walled-garden social lives. The collective nature of working in the banking industry created a culture that had changed very little for decades. The economy, following the civil war and statehood, remained sedentary due to the policy of protectionism. Banks had little scope to expand their business and active competition was virtually non-existent. Change came in the decade that followed the removal of protectionism. The 1960s is where the research takes up the tread and explores the way in which the culture of a major Irish bank (the Bank) has become transformed.
Almost eight years on from the bank guarantee scheme and a global economic crisis public and political discourse has only really begun to pay serious attention to the future of banking. The Nyberg report and the Banking Inquiry go some way towards understanding the global financial crisis but they have one weakness which limits their scope – they give little regard to the history of the development of banking in Ireland. This, combined with the prevailing perception of banks as being purely economic entities, thereby, ignoring their social elements, makes it difficult to really understand the culture of banking organisations. Ignoring these key qualities, it is argued, has inhibited an open and informed debate on the future of banking. So, when there are calls for a change in the culture of banking there is a lack of understanding on what the culture actually is. Quite often these calls are superficial and are not followed up by any practical solutions on how this change should take place.
Through gathering stories of working life in the Bank from the 1960s to 2000s this paper aims to describe the culture in modern banking. The paper contributes to the current public and political discussions on banking and the future of the industry by providing a comprehensive description of the organsiational culture of banking.

Theoretical Base

The research has been conducted inductively with the stories being collected at an early stage and was followed by consideration of emerging themes in an iterative pattern. The transformation of the Bank’s culture is explored primarily through the social life of bankers. Drawing on Huzinga’s (1938) the transformation of culture is observed through the shift from friendly communal play into competitive game. Through this medium it is possible to observe how the basic underlying assumptions (Schein, 1992) that are deeply embedded in the organisation’s fabric are loosened and reshaped into modern values and beliefs. The interactions and experiences of the workers through this time of change are additionally explored through the lens of performativity (Butler, 1990) and performances (Goffman, 1959), organisational isomorphism (DiMaggio & Powell, 1983) and workplace identities (Berger, 1964).

Research Questions & Method

The question that is being asked in this paper is ‘what is bank culture?’ It is a simple question that addresses a deficiency in both academic and public discourse. Banks are organisations like no other (Fama, 1985), they are vital to the stability of national economies and commerce and yet they are not well defined beyond their financial and economic contributions.
So as to provide a rich and unique perspective of banking culture the research looks to those who experienced this phenomenon. The data is collected through stories of working in a major Irish bank from the 1960s to the 2000s. Organisations are traditionally explored through their functions and structures but there has been an increase in interest of understanding the social constitution of organisations (Soderberg, 2003, p. 6). Stories have the ability to provide a deep insight into an organisation as they belong to the individual. It is the story of their experiences, of how they create meaning and how they make sense of events, it is not the story that the organisation fashions for its public persona (Boje, 1995; Weick, 1995; Gabriel, 2000).
Storytelling is intertwined in many traditions which, in turn, lead to a variety of ideas on how to analyse them. Following Boje (2001) the paper draws on grand-narrative as the method for analysing the stories. Grand-narrative, as described by Lyotard (1979), allows for analysis of stories based on their universality. Although Lyotard (1979) contends that in postmodernism localised stories are favoured over the grand-narrative, Boje (2001) argues that some grand narratives are dominant over local stories. In this type of long-form study developing a grand-narrative allows for the cultural aspects of the organisation to be woven together to allow the whole story to flow across generations and to provide a succinct picture of the past and the present, so a sustainable future can be considered.

Findings

The findings of this long-form research highlights the prolonged nature of organisational change, that change moves a different rates throughout organisations and takes some time for its full consequences to be realised. This, it is argued is perhaps a reason for commentators and inquirers into the global financial crisis denoting the 1990s as being pivotal to the changing culture of banking. The consequence of this is the bypassing of a point in time where key decisions were made to change the way banking was conducted in Ireland. In the 1960s key decisions were taken by the Bank to embark on a project to modernise the organisation, this was followed by the bank mergers in the late 60s and early70s which changed the environment for banking and introduced real and open competition for the first time. Working life in the Bank went from communal and husbanded careers to individual careers driven by the reaching of goals.
Through the stories of the social life in banking it is possible to observe a significant point in time that indicates the importance that these changes were to have on the culture of the organisation. Following the bank mergers the once communal social life among all the banks was brought to a halt. Workers who had once lived and played together were forbidden from continuing this practice. From this point on play is no longer a way escaping from the mundane and routinized daily life, it becomes part of the working life, for example, as a way to attract new business. For the workers modern practices have made their lives more individualised and to be successful they must play the game to meet goals and direct their careers. Ultimately this is a commentary on modern organisations. The Bank was once a special organisation with its own ways of working and acting. Over time, as it strived to modernise, the organisation became increasingly ordinary and isomorphic. The loss of basic underlying assumptions that directed its ethos and ethic of the organisation has turned banks into organisations like any other.

Implications

The findings detail how the culture of the Bank has changed over a forty year period. The paper argues that banks are social organisations and that by considering them in this way it is possible to achieve a deeper understanding of them. This in turn can lead to a more informed debate on how banking should be conducted in the future. The paper indicates that the changes that occurred in the Bank are not a recent phenomenon and to get to the root cause of the perceived failings of the current culture in the bank, this must first be acknowledged. Through exploring the moral values that were inherent in the traditional banks, the trusted pillars of the community, there may be lessons that could benefit the creation of stable and ethical banks for the future.

References

Boje, D. M., 1995. Stories in the Storytelling Organization: A Post-Modern Analysis of Disney as "Tamara-Land". The Academy of Management Journal, 38(4), pp. 997-1035.
Boje, D. M., 2001. Narrative Methods for Organizational & Communication Research. London: Sage.
Butler, J., 1990. Gender Trouble: Feminism and the Subversion of Identity. New York: Routledge.
DiMaggio, P. J. & Powell, W. W., 1983. The Iron Cage Revisited: Institutional Isomorphism and Collective Rationality in Organizational Fields. American Sociological Review, 48, pp. 147-160.
Fama, E., 1985. What's Different about Banks?. Journal of Monetary Economics, 15, pp. 29-39.
Gabriel, Y., 2000. Storytelling in Organizations: Facts, Fictions and Fantasies. Oxford: Oxford University Press.
Goffman, E., 1959. The Presentation of Self in Everyday Life. New York: Doubleday.
Huizinga, J., 1938. Homo Ludens: A study of the play-element in culture. Translated from German, 1949. London: Routledge & Kegan.
Lyotard, J., 1979. The Postmodern Condition: A report on knowledge. Translated from French by Geoff Bennington and Brian Massumi, 1984. Manchester: Manchester University Press.
Schein, E. H., 1992. Organizational Culture and Leadership. 3nd ed. San Francisco: Jossey-Bass Publishers.
Soderberg, A., 2003. Sense Making and Sense Giving in an Integration Process. In: Narratives we Organize By. Amsterdam: John Benjamins Publishing Company, pp. 3-36.
Weick, K., 1995. Sensemaking in Organizations. Thousand Oaks: Sage.

Banks, Banking, Organisational Culture, Banking Culture, Organisational Change, Organisational Storytelling [ view full abstract ]

Banks, Banking, Organisational Culture, Banking Culture, Organisational Change, Organisational Storytelling