Implementation OF HRM strategies

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CHAPTER IV

IMPLEMENTATION OF HUMAN RESOURCE STRATEGY-

ACTION PLANS AND PRACTICES

The following Chapter dwells into the collective opinions and experiences of the Sample

Respondents which were expressed in their unique individual styles. The responses from

the Sample were assembled, tabulated, and classified to draw meaningful inferences and

are presented in a textual format coupled with Human Resource action plan and practices.

Responsiveness towards Change

Business environment has become complex and aggressive. At any given moment of time,

there are multiple forces on an organization such as competitors, customer demands,

regulatory requirements, supply upsets, and technology breakthroughs. Organizations

overcome these hurdles by anticipating change, formulating a change management strategy

and finally by successfully implementing an action plan. Failing in any one of these would

lead to loss of market share, profits in the long-term. Organizations could no longer

succeed by producing the same goods or services year after year. Instead, they must adapt

rapidly to the changing consumer demands and needs to cope with an unpredictable

existing competition. The strategic ability of an organization to respond towards these

unanticipated situations was referred to as adaptability in this Study.


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In response to a question changes made in your organization are a reaction to

circumstances from 186 Respondents 48 percent Respondents agreed and 41 percent

Respondents strongly agreed that their organizations adapted to changes. Whereas 9

percent Respondents disagreed for adaptability toward change by their organization and 2

percent, Respondents remained neutral on this aspect (Chart IV. 1).

Without an exception, the Indian Banking Sector had undergone changes due to economic

reforms. Changes had taken place with respect to: the ownership pattern of Banks; changes

in delivery channels; and range of services provided to the customers. Banks like State

Bank of India, Punjab National Bank, Axis Bank, ICICI Bank, and HDFC Bank, have

broken the long-standing jams and started interacting in more friendly and professional

manner with their customers. Banks had started accepting online applications, which

made things easier for the aspirants.

One of a visible change symbol observed was an adoption of Bancassurance model by

Banking Organizations. Canara Bank has tied up arrangements in both life and non-life

insurance segments. In life insurance segment, Canara Bank has associated with AVIVA

Life Insurance Company India Private Limited to undertaken the marketing of life

insurance products. In non-life insurance segment, Canara Bank developed a strategic

alliance with United India Insurance Company Limited for marketing of non-life insurance

products.


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CHART IV. 1

ORGANIZATIONS RESPONSIVENESS TO CHANGES

To Study the change, three forms of change were discussed. First, Banks needs to change

product portfolio. Product here referred to transient intermediary mechanisms through

which the markets derive value from the organization and the organization derives value

from the market. Second, process changes in Banks. Process here referred to the overall

layout of the place concerned i.e., how the Banks branches is to designed to ensure

maximum convenience to customers. Identifying the key processes which organization

may excel to add value to their services made these processes simplified. To satisfy

customers, organizations brought entirely new internal processes, which customers could

easily understand and follow it. Third form of change was organizations responding to

customer needs. In order to focus upon long-term relationship building with customers

deep knowledge of customer needs was emphasized. Due to the rapid changes taking

place, organizations needs to develop a more focused and coherent approach to manage

customers preferences. On these three forms of change, Respondents were questioned.

0%

9%

2%

48%

41%

0%

10%

20%

30%

40%

50%

60%

Strongly

Disagree

Disagree Neutral Agree Strongly

Agree

Adaptability


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In response to a question your organization has made continuous changes in its products

and services from 186 Respondents, 52 percent Respondents strongly agreed and 45

percent Respondents agreed that their organizations made changes in the products and

services offered by them. Whereas 3 percent Respondents disagreed on any kind of

product portfolio modified by their organization (Chart IV. 2).

In response to a question your organization has made continuous changes in its processes

from 186 Respondents, 58 percent Respondents agreed and 45 percent Respondents

strongly agreed that their organizations had brought changes in the processes of their

Banks (Chart IV. 2).

In response to a question your organization recognizes change in customer preferences

from 186 Respondents, 67 percent Respondents strongly agreed and 32 percent

Respondents agreed that their organizations were identifying changes taking place in

customers requirements. Whereas 2 percent Respondents disagreed on any concern

shown by their organization towards customers requirements (Chart IV. 2).

Overall Banks had undergone three major changes. As in case of traditional Banking there

existed products which were limited to drafts, telegraphic transfers, bankers cheque and

internal transfer of funds. Foreign, Private and few Public Sector Banks has also

introduced customized Banking products like investment advisory services, photo-credit

cards, cash management services, investment products and tax advisory services.


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Today Banks have become into one-stop financial shop. For instance, ICICI Bank has

added features to their services by allowing there users to access account information over

a secure line, request chequebook and stop payment and transfers of funds on-line. ING

Vysya Banks product portfolio offered products that catered to every financial

requirement, for all life stages. ING Vysya Bank has developed the LifeMakerTM a simple

tool that helped customers to choose a plan according to their requirements of saving,

investment, or retirement and life stage of customers. State Bank of India brought an

entirely new spectrum of loan products like housing loans, car loans, personal loans,

consumer durable loans, education loans, loans against share and financing against gold.

Banks are also providing financial assistances to agriculturists, through a network of rural

and semi-urban branches and offered schemes covering a wide range of agricultural

activities like crop loan, finance to horticulture, farm mechanization schemes, land

development schemes and irrigation project loans.

Payment processes exercised by Banks are very different from the conventional methods.

Due to the introduction of technology based processes different methods have evolved by

which customers could make payments. Different methods of payment today are - cash,

cheque, demand drafts, credit cards, debit cards, and electronic payments. Electronic

payments could be made in the form of Electronic Funds Transfer (EFT), Electronic

Clearing Service (ECS) for small value repetitive payments and through Real Time Gross

Settlement (RTGS) System for large value payments. Customers could make payment as

per their convenience, with the help of any processes.


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Banks like State Bank of India, ICICI Bank,HDFC Bank, and many others Banks has

become systematic and simpler to solve customers problems. Customer just needs to walk

in the Banks branch and press the key related to his problem and machine automatically

allocates the concern person from the branch to the customer, according to the type of

problem of the customer. This has helped customers to save time and to overcome his

hesitation and lack of knowledge about Banking processes. Bank of India has developed a

customer centric infrastructure layout that enabled Bank to provide increased customer

service levels with ability to attract new customers and manage customers with the help of

Core Banking Solutions across branches.

To respond towards changing customers preferences Banks managed informations

related to their: customers profiles, location and cash position; customers preferences;

and complaints. Banks had also focused on region-specific campaigns rather than national

media campaigns due to diversity in country like India. Another region-specific effort

made by Banks was to use local languages on Automated Teller Machines. As customers

found it much easier to operate in their local languages. Banks also noted down customers

recommendations and inquired from customers about their impression about the services.

All Commercial Banks including Public Sector Banks has understood the importance of

customer retention.


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CHART IV. 2

MAJOR CHANGES IN BANKS

Nature of Change Strategic in Banking Organizations

Change accepted as an opportunity and a right perspective of the change might slice

competitive edge over the competitors for the organization. The question here arises

whether Change in Banks was strategic or not? If organization predicts changes, coming

ahead in the business from the study of influences of various environmental factors; that

means that organization is strategic. Different natures of change required different

strategies to be adopted by organizations. If organization initiates for future environmental

developments, one could state that the nature of change is strategic in the organization and

this aspect referred to aspredictability in this Study.

0% 0 0%3%

0 2%0% 0% 0%

52%

58%

32%

45%48%

67%

Change in Product

Portfolio

Process Changes in

Banks

Organization's

Responding to Customer

Needs

Strongly Disagree Disagree Neutral Agree Strongly Agree


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In response to a question your organization is able to anticipate changes, either internal or

in external environment 74 percent Respondents agreed and 26 percent Respondents

strongly agreed that their organizations were predictable with concern to changes which

organization might come across in future (Chart IV. 3).

Respondent responses were further corroborated by the following observations: Banks are

investing in the state of the art technology that ensured reliable service delivery; structural

changes has taken place in Banks, prominently in Public Sector Banks; top-level strategic

planning cells analyzed aspects related to technology up-gradation for instance, in Banks

like Canara Bank, Union Bank of India and ICICI Bank.

Customer feedback and data collection was carried specifically in State Bank of India

where customers could register their complaints through a touch screen device placed at

the Banks branch that collected customers feedback. Further, this feedback machine

transferred the stored information for processing and to be utilized by management to

know how operations were carried. Another strategic approach adopted by Branch

Managers was that they conducted conferences to acquaint employees about existing and

expected environmental threats and opportunities. Almost all Public, Private and Foreign

Banks has adopted systematic approaches towards environmental diagnosis including

volatile changes in world financial markets and caution steps taken towards these changes.


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CHART IV. 3

PREDICTABILITY OF CHANGEIN BANKS

Towards being strategic, organizations must follow the law of change to survive in this

competitive era. Due to changing internal and external environment, rapid changes

occurred in the organizations. Organizations needed to have four main aspects with respect

to adjustment towards change. First,significance of change means organizations needed to

view change as a vital constituent of their survival strategy. Second, Change as a process,

means change could not be looked as with specific beginning or ending, suggesting

changes should flow like stream through time 1. Third, change management means

involvement of management to manage change. As support from management plays key

role to carry the processes of changes. Management helps to change employee attitudes

from avoidance to acceptance. Fourth, change as continuous means implementation to be

uninterrupted. To get insight on these four aspects Respondents were questioned on these.

0% 0% 0%

74%

26%

0%

10%

20%

30%

40%

50%

60%

70%

80%

StronglyDisagree Disagree Neutral Agree StronglyAgree

Preditability


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In response to a question your organization recognizes change as a crucial act from 186

Respondents , 72 percent Respondents agreed and 28 percent Respondents strongly

agreed that their organization considered change as a vital component (Chart IV. 4).

In response to a question change is thought of as a process in your organization from 186

Respondents, 74 percent Respondents agreed and 26 percent Respondents strongly

agreed that their organizations perceived change as process. (Chart IV. 4).

In response to a question change management involves top-management support from

186 Respondents, 60 percent Respondents agreed and 40 percent Respondents strongly

agreed, that management of their organization played an important role in bringing

changes (Chart IV. 4).

In response to a question change is implemented on a continuous basis in your

organization from 186 Respondents, 76 percent Respondents agreed and 16 percent

Respondents strongly agreed that their organizations implemented changes on

continuous basis whereas, 8 percent Respondents disagreed on change implementation in

their organizations (Chart IV. 4).

These finding were further corroborated by the following aspects: management talked with

employee representatives, union leaders about issues like- introduction of technology into

the work practices, additional allowances or variable remunerations to staff, changes in

branch timings or working hours ; change curriculum has been included as a component in

staff training programmes; bank circulars, newsletter explaining imperativeness of changes

were circulated, showing the significance of change to Banking Industry.


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Considering change being an essential factor, Banks had taken up skill up-gradation

throughproper training and re-training to keep their workforce efficient enough to takeup

the challenges due to the environmental changes unfolding every day. Training

programmes on change management were organised by Banks like Bank of India, Kotak

Mahindra Bank, Vijaya Bank, UCO Bank, and ICICI Bank with institutes like Indian

Institute of Finance and Banking (IIFB), National Institute of Banking Management

(NIBM). Due to change, sometimes even employees might need to even unlearn their past

knowledge and re-orient themselves to the present knowledge.

Banks considered change as a process. For this reason, Banks hired outside specialist or

consultants for changes occurring in their organizations. Banks faced changes due to

acquisition or mergers taking place in order to achieve increased market presence. Apart

from these Banks, undergo continuous changes due to the technological changes.

Banks developed state of the art accounting softwares like Online Tax Accounting

Systems (OLTAS), specifically implemented by Bank of Baroda. This software helps to

collect taxes on the behalf of Central Board of Direct Taxes, Government of India. Banks

using software needs to upgrade their Information Security Management System to ensure

confidentiality. These security systems included firewalls, anti-virus, centralized domain

controlling, application security, database security, and other measures, which prevent fund

transfer frauds. This raised the need of technological changes as technology becomes

obsolete if not updated.


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Other types of changes implemented by Banks included for instance, financial systems like

Basel I in which Banks were focused on credit and market risks. Basel II implementation

endeavoured Banks to constantly upgrade their risk management systems to address the

changing environment. Banks, implemented 24* 7 Banking nationwide and worldwide to

cope changes in the requirements of their customers. For example, ING Vyasa opens on

Sundays, ICICI opens from 8 a.m. to 8 p.m. on weekdays and provided 24 hour customer

service. Oriental Bank of Commerce service branch in Delhi required their officers to work

in Morning Shift, between 6 a.m. to 1p.m. and in the Evening Shift, from 2 p.m. to 9 p.m.

for this employees were given inconvenience allowance Rs. 2, 500/- per month to motivate

them to work in odd hours.

ICICI Bank has successfully brought and implemented various changes to overcome the

effects of recession during 2008- 2009. ICICI Bank clearly communicated the

organizations position and strategies to its customers, investors, regulators, and

employees. This open communication also acted as a significant confidence building

measure among stakeholders in the background of a volatile environment and ensured

stability. In Indian Bank (IB) Human Resource Practices, beginning from hiring to

retirement was brought under SAP software. The Hong Kong Shanghai Banking

Corporation (HSBC) and ICICI Bank has introduced uniform for their employees in the

branches operating in India. Both these Banks implemented change successfully.


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CHART IV. 4

IMPLEMENTATION OF CHANGE IN BANKS

Performance Influenced by Strategic Intent

Performance standards help organizations to know, the strengths and weaknesses of their

organizations. Thus, defining outcome metrics clearly identified the gaps existing in the

organizations performance. Performance of organizations largely depended on policies,

processes, and their effective implementation. Banking Organizations achieving their

tangible and intangible objectives referred to asperformance in this Study.

0% 0% 0% 0%0% 0% 0%

8%

0% 0% 0% 0%

72% 74%

60%

76%

28%

26%

40%

16%

Significance of

Change

Change as a Process Change

Management

Change as

Continuous



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In response to question your organization is able to achieve both tangible and intangible

goals from 186 Respondents, 71 percent Respondents agreed and 15 percent

Respondents strongly agreed that their organizations were able achieve performance

objectives. Whereas 14 percent Respondents disagreedthat, their organizations failed to

achieve the performance standards (Chart IV. 5).

Banking Sector has recorded marked improvement, as Non Performing Loans (NPL) has

declined and Banks profitability levels has trended upwards 2. Banks had built up their

assets size and diversified their product ranges from rural to urban products, along with

diversification internationally. For instance, Bank of Indias net profit reached Rs. 3007

crore over and above the profit level of Rs. 2009 crore in 2008. The operating profit of the

Bank went up by 47.45 percent from Rs. 3701 crore in 2007-08 to Rs. 5457 crore in 2008-

09. The Returns on Assets reached the benchmark level of 1.0 percent 3. Besides financial

measurements, Banks realized that its revenue comes from their customers who are willing

to pay for the values provided to them by the organizations. Further, the performance

improvements were also indicated by the increased market share, customer retention,

customer acquisition, and customer satisfaction in Banking Industry.

CHART IV.5

PERFORMANCE OF BANKS

0%

14%

0%

71%

15%

0%

10%

20%

30%

40%

50%

60%

70%

80%

Strongly

Disagree

Disagree Neutral Agree Strongly

Agree

Performance


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As we discussed performance of an organization, at its backdrop lies Strategic Intent. Thus,

defining Strategic Intent of an organization for Business or for Human Resource Strategy

provided sense of purpose and direction to organizations. Strategic Intent could be

expressed with the help of following components: the vision serves the purpose of stating

what the organization wishes to achieve in the end .Vision statement also guided

employees about the services that they have to provide to their customers; the mission

statement that defines the basic reason for the existence of the organization. The mission

statement mentions about its purpose, the nature of business and customers it seeks to

serve and satisfy; the values and principles that defines the personal values and helps

employees to match their values with the organizational values and principles. Thus,

defining the values and principles helped to avoid the situations of conflict and confusion.

Organizations reflected the values in words like teamwork, communication, innovation or

quality;thegoalsprovide guidance, direction, facilitate in planning, motivation and helps

organizations to evaluate and control performance. Goals formulated by organizations

needed to be realistic which were achievable by employees; and the objectives defined, as

strategic objectives which are guide to organization towards growth plans and financial

objectives are related to the financial achievements of the organization. Thus, identifying

organizations existing vision, mission, values and principles, goals and objectives gave a

logical starting point for strategic management because these clearly presented situation

and condition of organizations. To get insight on Strategic Intent aspects, Respondents

were questioned accordingly.


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In response to a question on employees are well aware of their respective service level

agreements from 186 Respondents, 80 percent Respondents agreed and 12 percent

Respondents strongly agreed that they were aware about the purposes of their services.

Whereas, 6 percent Respondents disagreed on any specific purposes being stated by their

organizations to be achieved by employees and 2 percent Respondents remained neutral

on this aspect (Chart IV. 6).

In response to a question your organization has a purpose of existence in the society from


agreed that their organizations had a particular purpose to serve to the society. Whereas,

13 percent Respondents disagreed on any purpose that their organizations aimed at

(Chart IV. 6).

In response to a question core values and principles are clearly defined in your


Respondents strongly agreed that they are aware about the values and principles that they

have to adhere to, while working in the organization. Whereas, 10 percent Respondents

disagreed on values and principles defined to them (Chart IV. 6).

In response to a question organizational goals are realistic from 186 Respondents, 54

percent Respondents agreed and 13 percent Respondents strongly agreed that the goals

defined to them were realistic. Whereas, 33 percent Respondents disagreed about goals

defined were realistic (Chart IV. 6).


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In response to a question Mergers/Acquisitions, Integration/Diversification are considered

important strategies for growth in your organization from 186 Respondents, 56 percent

Respondents agreed and 14 percent Respondents strongly agreed that their

organizations aimed to achieve higher growth objectives through merger, acquisition,

integration and diversification. Whereas, 27 percent Respondents disagreed and 2 percent

Respondents strongly disagreed that the growth plans formulated did not specified about

the strategic aims of the organization and 1 percent Respondents remained neutral on this

aspect (Chart IV. 6).

In response to a question financial objectives of your organization such as revenue,

earnings or return on investment etc. are achievable and realistic from 186 Respondents,

64 percent Respondents agreed and 13 percent Respondents strongly agreed that their

organizations had achieved the financial objectives, already defined. Whereas, 23 percent

Respondents disagreed suggesting that their organizations were not able to achieve

financial objectives (Chart IV. 6).

Banks have begun to explain strategic vision to their employees. For instance, Indian Bank

defines its vision as first choice of the common manand to achieve this vision employees

need to know how to achieve this vision of their organization. To reach to the common

man Indian Bank has opened an exclusive Core Banking Solution branch along with online

bio-metric voice guided Automated Teller Machine facilities in Dharavi, Mumbai, to target

a large number of migrant workers who were under the unbanked sector from many

decades and covered 770 villages under financial inclusion project (2006-07)4.


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Banks also stressed on defining the purpose statement, which also acted as a guideline for

structuring strategies. For instance, Yes Bank in their mission statement emphasized

towards their commitment to add long-term value to the Society. Apart from vision and

mission, every Banks branch managerdefine role to their employees that consisted of set

of goals to be achieved by them in a particular period. Further, these goals were defined in

terms of financial objectives like Return on Investment (ROI) and Return on Equity

(ROE). Finally, clearly defined goals and objectives reduced the difficulty in the

coordination of the activities and events. In context of Human Resource Department, the

vision of Human Resource Department in some Banks is to have excellent people for their

organization. The mission of Human Resource Departments could be to achieve strategic

aims and business plans through the resourcing, development, and motivation of

workforce. Banks had the following values and principles: right people in the right job;

continuous improvement; compliance with the law; treating people with respect, fair and

equitable practices and work-life-balance.

CHART IV. 6

RESPONDENTS RESPONSE ON STRATEGIC INTENT

0% 0% 0% 0%2% 0%

6%13%

10%

33%27%

23%

2% 0% 0% 0%

15%

0%

80%

67%72%

54% 56%

64%

12%

20% 18%13% 14% 13%

Vision Mission Values and

Principles

Goals Strategic

Objectives

Financial

Objectives



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Human Resource Strategy and Organization Change

To meet the challenges due to change, organizations needed to focus on appropriate

capacity building measures to handle advanced risk management system and to equip

themselves with appropriate skills.Human Resource Strategy, calls for reviewing and

reengineering the Human Resource functions, both at the level of corporate Human

Resource Division and at the level of branch managers to proactively manage people at

work. Human Resource Strategy defined as a co-ordinated set of actions aimed at

integration of organizational resources 5. Thus, it is essential that Human Resource

Strategies and Change intertwined with each other. Human Resource personnels may

suggest best Human Resource Strategy, which could combine resources and behaviour to

their best with the organizational changes.

In response to a question resources are utilized in a synergetic manner from 186

Respondents, 70 percent Respondents agreed that in their organization various resources

were managed to produce higher results .Whereas, 18 percent Respondents disagreed that

their exist hardly any combined fruitful effect of the resources present in their organization

(Chart IV. 7).


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CHART IV. 7

HUMAN RESOURCE STRATEGY IN BANKS

Existence of change has emphasized the existence of Human Resource Strategies in the

organization. The change factors that Banking Organizations has to face are: workforce

demographic changes which are complex to understand. These exist in the organizations

due to the diversity of the workforce; changes in employee expectations due to changing

social values ; technological changes are taking place at a faster rate and Banks are

required to make review of the arrival of new tasks, techniques, and the skills associated

with these ; organizational restructuring due to downsizing, mergers and closure

intermediaries. Organizational restructuring bring in major realignments among culture,

vision, values, strategy, structure, and management system; changes in customers means

the changes taking place in the needs of customers; and changes in the economic

conditions of an organization due to uncertainties existing in the external environment. To

get insight on organization change Respondents were thus, questioned.

0%

18%

0%

70%

11%

0%

10%

20%

30%

40%

50%

60%

70%

80%

StronglyDisagree Disagree Neutral Agree StronglyAgree

Human Resource Strategy


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In response to a question diversity exists within your organization workforce from 186

Respondents, 52 percent Respondents strongly agreed and 41 percent Respondents

agreed that workforce diversity existed in their organization. Whereas, 5 percent

Respondents disagreedand 2 percent Respondents strongly disagreed on existence of

diversity among the workforce in their organization (Chart IV. 8).

In response to a question employee expectations change continuously from the


Respondents strongly agreed that changes in the employees expectations had occurred.

Whereas, 13 percent Respondents disagreed on any kind of variations that had occurred

with respect to employee expectations in their organizations and 2 percent Respondents

remained neutral on this aspect (Chart IV. 8).

In response to a question technological changes are appreciated and absorbed with

swiftness from 186 Respondents, 49 percent Respondents agreed and 41 percent

Respondents strongly agreed that the technological changes were adopted by their

organizations speedily. Whereas 8 percent Respondents disagreed on technological

changes being appreciated by their organizations and 2 percent, Respondents remained

neutral on this aspect (Chart IV. 8).

In response to a question there have been change in your organization structure owing to a

restructuring from 186 Respondents, 71 percent Respondents agreed and 20 percent

Respondents strongly agreed that organizations structure had changed resulting into

restructuring of their organizations (Chart IV. 8). Whereas, 7 percent Respondents


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disagreed on any structural changes taken in their organizations and 2 percent

Respondents remained neutral on this aspect (Chart IV. 8).

In response to a question customers preferences have changed in the past few years from


agreed that change in customer preferences had been observed. Whereas 11 percent

Respondents disagreed and 3 percent Respondents strongly disagreed that their

organization had hardly paid attention towards the changes in the customer preferences and

4 percent Respondents remained neutral on this aspect (Chart IV. 8).

In response to a question your organizational plans and policies are influenced by Indias

economy from 186 Respondents, 60 percent Respondents agreed and 26 percent

Respondents strongly agreed that their organizational plans and polices were influenced

by changes in the economic conditions. Whereas, 13 percent Respondents disagreed that

their organizations were not influenced due to the changes in the economic conditions and

1 percent Respondents remained neutral on this aspect (Chart IV. 8).

In the context of organizational changes, it was observed that Banks workforce constituted

of different age groups, people from different castes, religions, and gender. The Private

Sector Banks were transparent on employment terms and boosted job opportunities for

employment of women. Banking Sector encouraged a high recruitment rate for women, as

these jobs were perceived to provide a better stability, lesser travel, regular working hours,

and a secure working environment, dissimilar from many other fields of jobs. Women like

Naina Lal Kidwai of the HSBC Bank, Shikha Sharma of the Axis Bank, and Chanda

Kochhar of ICICI Bank were encouraged to take up top management positions.


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Employees expectations had changed from the traditional allurements such as job security,

attractive remuneration, and housing to the employees wanting more information about

their organizations, to know reasons behind managers decision and they want to be valued

and personally recognized for their contributions.

Banks constantly face changes in technology and accordingly some of them have

reconfigured the skill mix of their employees. The Public, Private, and Foreign Banks had

adopted technology and benefited with respect to quality of risk management systems,

better service delivery, improved handling of accounts and remittances and reduced

operation cost in spite of vast expansion strategy adopted by them. For instance, Dena

Bank has launched several technology enabled services like Dena bill-pay, Dena M-

banking, Dena internet banking, Multi-city cheque facility and value added services

through Automated Teller Machine.

Union Bank of India has brought value added services like- online ticketing of air and rail,

online tax payment, online trading of shares, online bill payments, online Demat

information apart from the regular Banking services. With the introduction of technology,

jobs had become more broad based and this made it mandatory on the part of Human

Resource Management to train workers and to replace them in time. Human Resource

Management plays an important role in selection and induction of competent people, and

motivating them to perform at higher levels of efficiency, by providing them mechanisms

that ensured that they maintain their affiliation with the organization.


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Banks had realigned their existing human resource and readjusted staffing patterns. Due to

the advent of computerization clerical and subordinate staffs were in excess in each Bank.

Jobs were designed and restructured for Banks to get flattened organization structure,

which also encouraged work innovation in the organizations. Surplus staff was relocated or

reassigned with the job duties to overcome surplus manpower. Mobility of the staff was

recommended and on this aspect, management had negotiated with employees and

persuaded them, as mobility of staff improves organizational efficiency and productivity.

Not only Public Sector Banks like State Bank of India, Punjab National Bank, Canara

Bank and Central Bank of India but also Foreign Banks like Standard Chartered Bank and

BNP Paribas periodically introduced volunteer retirement schemes to get rid of extra flab 6.

Economic changes also influenced organizations and were mainly analyzed by top

management. Human Resource Managers played a key role to scan and study the direct

and indirect influences of these economic uncertainties on the Human Resource Strategies.

In relation to this, Human Resource Managers adopted role of protector and screener in the

Banking Industry. Economic uncertainties brought the change of interest rates, mergers

and acquisition plans, reorganizations or relocation of Bank branches, and changes in

bonus incentives of employees. For instance, ICICI Bank viewed economic changes and

accordingly adopted a conscious strategy for building of stable and low cost funding base

by consolidating their balance sheets and setting clear targets. This resulted into

moderation of business volumes which helped Bank to position better and regain their

growth cycle 7.


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CHART IV. 8

ORGANIZATION CHANGE VARIABLES INFLUENCING BANKS

0% 0% 0% 0%3%

0%5%

13%

8% 7%

11%13%

0%2% 2% 2% 4% 1%

41%

63%

49%

71%

48%

60%

54%

22%

41%

20%

34%

26%

WorkforceDemography

EmplyoeesExpectations

Technology OrganizationalRestructure

Changes inCustomers

EconomicConditions



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Any organization could be called as people centric organization if it adapts people centric

strategies. To build employees relationship, organizations need to practice following

strategies: teamwork, information sharing, creativity, participation, empowerment, quality

of work-life, workplace feedback, employee management relationship/collective

bargaining, grievance handling, and career progression planning. To strengthen

relationships with employees, organizations need to provide benefits to their employees

like - flexible benefits, flexi work arrangements, health and safety and working conditions.

Various employees related strategies are discussed.Teamworkhere referred to as a set of

values that encouraged behaviour such as listening and responding co-operatively to

viewpoints expressed by others and providing support for organizational achievements .

Along with teamwork, employees needed to be well informed thus raising the significance

of the information sharing. Sharing information helped to remove confusion and resistance

among employees. Information flow needs to be clear and consistent to generate trust and

cooperation among employees of the organization and to sustain competition organizations

need to allow their employees to work with creativity.

Stronger employee relationship stimulates employees to devise decisions that affected

organizations well being. Initiative nature of employees allowed employees to take work

related decisions covering issues like work methods, task assignments and performance

outcomes. Thus, organizations needed to practice participative style to be a people

centric organization. In order to motivate employees to make decisions and participate,

employees needed to be empoweredby their organizations. Apart from empowerment,

quality of work- life needed to be improved to increase employees satisfaction by

strengthening workplace learning and managing change transitions.


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Further workplace feedback encourages understanding, acceptance, and ultimately

behavioural modification among employees. It creates a timely opportunity to identify

potential trouble and rectify if any mistake existed. Researchers had also emphasized that

there should be a report after performance analysis of an employee and at the end detailed

results and recommendations based on the analysis of resources and participants feedback8.

Thus, work place feedback helps to develop better understanding.

Work place feedback will be fruitful if employee-management relationship/collective

bargainingwere encouraged by the organizations in which representatives of management

and workers negotiate on terms and conditions of employment. Though cooperation may

exist in an organization, still conflicts may arise in the organization due to day-to-day

working, which could be handled with the help of grievance handling procedures.

Grievance handling procedures allowed employees to ventilate their feelings. Thus,

organizations needed to have a proper grievance resolution and handling procedure.

Lastly, for an organization to be a people centric organization it requires to have career

progression, as it aligns employees needs with career opportunities available within the

organization.

In response to a question consistent joint efforts from superiors, peers and subordinates is

present during day to day functioning from 186 Respondents, 76 percent Respondents

agreed and 20 percent Respondents strongly agreed that in their organizations seniors,

peers and subordinates provided support to each other at work place. Whereas 4 percent

Respondents disagreed that, hardly any joint efforts were made by employees in their

organizations (Chart IV. 10).


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In response to a question information from top management is clear and consistent from


agreed that their organizations emphasized on the consistent and clear information flow.

Whereas, 4 percent Respondents disagreed on any kind of emphasizes been made by their

organizations on the sharing of information (Chart IV. 10).

In response to a question your organization encourages employees to provide creative

suggestions from 186 Respondents, 63 percent Respondents agreed and 19 percent

Respondents strongly agreed that their creative suggestions were encouraged by their

organizations. Whereas, 13 percent Respondents disagreed and 1 percent Respondents

strongly disagreed that hardly creative suggestion were heard or promoted by their

organizations, and 4 percent Respondents remained neutral on this aspect (Chart IV. 10).

In response to a question your organization encourage participative style from 186


agreed that their organizations practiced participation. Whereas 13 percent Respondents

disagreed that employees were hardly motivated to participate in the decision- making

(Chart IV. 10).

In response to a question your job gives you enough prospects to resolve problems from

186 Respondents, 78 percent Respondents agreed and 9 percent, Respondents strongly

agreed that they were allowed to take decisions within ones area of operations. Whereas,

11 percent Respondents disagreed suggesting that the job of employees hardly provided

any prospects to resolve problems at the workplace and 2 percent Respondents remained

neutral (Chart IV. 10).


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In response to a question improvement in quality of life of employees and customers is

emphasized from 186 Respondents, 63 percent Respondents agreed and 23 percent

Respondents strongly agreed that quality of life was emphasized by their organizations.

Whereas, 14 percent Respondents disagreed that hardly any emphasize was made to

improve the quality of work-life for employees (Chart IV. 10).

In response to a question feedback is provided to employees in a regular and planned

manner from 186 Respondents, 64 percent Respondents agreed and 25 percent

Respondents strongly agreed that they were provided proper feedback in their

organizations. Whereas, 9 percent Respondents disagreed that hardly any emphasize was

given on work-related feedback and 2 percent Respondents remained neutral on this


In response to a question conflicts occur sometime between employees and management


strongly agreed that in their organizations there existed cooperation among employees

and management. Whereas 15 percent Respondents disagreed and 1 percent Respondents

strongly disagreed that hardly any cooperation existed between employees and

management this aspect hinted towards existence of conflicts between employees and

management 7 percent Respondents remained neutral on this aspect (Chart IV. 10).


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ICICI Bank has specifically empowered their newly joined employees and provided

complete authority to them to handle their job roles. After two weeks of an orientation

programme employee were given assignments and were motivated to make decisions in the

very first week itself. Apart from employee participation, ICICI Bank practised

performance feedback sessions to improve performance of their employees. During

feedback, process employees were made aware of problem areas and were made to

understand the consequences of the problem behaviour.

Kotak Mahindra Bank has developed a simpler way for feedback named as Kotak

Integrated Sales and Service System (KISSS) worked as an online application, which

defined the action plan for their employees. This online application consisted of details

related to relationship calling, daily sales report, and appointment schedules. This software

also sends weekly details about the performance scores and indicated employees lagging

point so that employees could quickly work upon on the same before the end of the month.

Kotak Integrated Sales and Service System clearly predicted the performance of their

employees portfolio.

To overcome employees discontent the joint consultative committees were set up at

different levels. In Banks, a grievance procedure has become an integrated part of the

policy to promote better relationship between management and employees. For instance,

Bank of Baroda has introduced a help-line directly connected to Chief Executive Officers

office for those employees who faced any sort of crucial problems. ICICI Bank has started

staff space on the intranet where employees could participate in collaborative activities

such as- contributing documents, engaging in discussions and posting or answering queries

leading towards better cooperation.


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CHART IV. 10

EMPLOYEE DEVELOPMENT RELATIONSHIP STRATEGIES

0%

0%

1%

0%

0%

0%

0%

1%

0%

0%

23%

16%

15%

9%

14%

13%

11%

13%

18%

4%

1%

1%

7%

2%

0%

1%

2%

4%

0%

0%

66%

67%

55%

64%

63%

77%

78%

63%

63%

76%

10%

16%

22%

25%

23%

9%

9%

19%

19%

20%

Career Progression

Grievances Handling

Employee-management

Cooperation

Workplace Feedback

Quality of Work-life

Empowerment

Participation

Creativity

Information Sharing

Teamwork

Strongly

Agree

Agree

Neutral

Disagree

Strongly

Disagree


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In response to a question employee family friendly polices like childcare, flexible work

time are realized from 186 Respondents, 49 percent Respondents agreed and 8 percent

Respondents strongly agreed that they were provided with benefits like medical,

insurance and retirement. Whereas, 31 percent Respondents disagreed and 9 percent

Respondents strongly disagreed that hardly any emphasis was given towards flexible

benefits for employees, and 3 percent Respondents remained neutral (Chart IV. 11).

In response to a question Programmes/campaigns on health awareness or related issues are

regularly conducted from 186 Respondents, 56 percent Respondents agreed and 27

percent Respondents strongly agreed that regular health related programmes had taken

place in their organizations. Whereas, 17 percent Respondents disagreed that hardly any

health awareness programmes were carried by their organizations (Chart IV. 11).

In response to a question working conditions provided to employees are good from 186


agreed that the working conditions provided by their organizations were good . Whereas,

3 percent Respondents disagreed that hardly any emphasis was being made by their

organization on working conditions and 1 percent Respondents remained neutral on this


Private and Foreign Banks has introduced practices like parent leave, flexible working

hour and supportive childcare polices. These practices provided sympathetic understanding

and material aid to their employees to deal with stressful situations. Access to flexible

scheduling helped employees to manage their work and family and increased job

satisfaction and lowered their work-family conflicts.


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For instance, HSBC Bank offered flexible working hours to their staff instead of

conventional days per year basis. HSBC Bank also provided on-line job share register,

which enabled employees to form a professional job sharing partnership. The Bank has

offered flexible working arrangements to around 10 percent of their employees that was

6,500 workforce 9.

Retirement benefit like pension is provided to employees of Public Sector Banks as one of

the major benefit to employees.Public Sector Bank employees are eligible to receive a

benefit pension equivalent to 50 percent of their last salary drawn. In this, few variations

might exist from one Public Sector Bank to another. For instance, SBI Bank employees

received 40 per cent of their last salary drawn in the form of pension, provident fund and

gratuity 10.

Public Sector Banks also provided medical benefits to their employees like medical

expenses incurred on diseases. For medical benefits Banks tied with hospitals at major

centers in India like Delhi, Mumbai and other metro cities where employee and his family

members could walk-in. In these hospitals, reserved beds were kept for employees and

their dependents.

Banks also emphasized on the health issues like physical health, mental health, stress

management, Acquired Immune Deficiency Syndrome (AIDS), alcoholism and drug abuse,

and violence at work place. Fitness programmes and employees assistance to prevent

health problems and health hazards that might occur were suggested to employees.


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Most of the Public Sector Banks conduct medical check-up for their employees of 45 years

of age and above once in 2 years in the approved diagnostic centre. Bank employees work

on computer for more number of hours thus, the risks associated are highlighted to

employees by their organizations.

Apart from these, recently after the instance of 26 November 2009, Mumbai terror attack,

few Banks quickly offered a team of psychologists to their employees as a proactive

measure to provide relief and reduce stress among employees. Banks also stressed upon the

security of their employees, thus, they periodically reviewed implementation of security

arrangements at branches. Security arrangements included, installation of time lock at the

cash safe and constant observations were made by installation of Close Circuit TV (CCTV)

to monitor and record the movements inside the branch premises round-the-clock.

CHART IV. 11

BENEFITS TO BANK EMPLOYEES

21%18%

0% 0%

23% 24%

17%

3%0%

3%0% 1%

51%47%

56%

46%

5%8%

27%

50%

Flexi-benefits Flexi-work

arrangements

Health Promotion Working

Conditions



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Effectiveness of Human Resource Practices required Human Resource Strategies

Human Resource Practices depend on having the right Human Resource Strategy.

Organizations need to consider relevant Human Resource Strategy to achieve

effectiveness. Effectiveness of Human Resource Practices in this Study means how well

the Human Resource Practices were implemented .

In response to a question there existed effective Human Resource Practices in your


Respondent strongly agreed that in their organizations, Human Resource Practices were

implemented and well practised. Whereas 15 percent Respondents disagreed that, hardly

their organizations practised well formulated Human Resource Practices (Chart IV. 12).

CHART IV. 12

EFFECTIVENESS OF HUMAN RESOURCE PRACTICES IN BANKS

0%

15%

0%

73%

12%

0%

10%

20%

30%40%

50%

60%

70%

80%

StronglyDisagree

Disagree Neutral Agree StronglyAgree

Effectiveness of Human Resource Practices


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Human Resource Strategy in organizations acted as an active endeavour that managed

people and their skills with the immediate and long-term aims of the business in their

mind. The following Human Resource Strategies were studied in the backdrop of Banking

Industry: manpower planning predominantly incorporated the number crunching. The

manpower requirements change, due to the new emerging areas of operation and

geographical dispersion nature of this industry; cost controlling of manpower helps to

maximize productivity and minimise output cost per unit with the help of human resource

budget; talent acquisition referred to as the policies and programmes that ensured that

organization gets and keeps talent it needed ; deployment helps to overcome surplus or

excess staff in Departments resulting into effective deployment of resources so that they

could handle positions handed over to them ;job profile and designatingemployees in well

planned mannermake employees accountable for their decisions, for the job assigned to

them;skill up-gradation helps employees to provide an environment in which employees

were encouraged to learn and develop as organizations required their employees to

perform in complex situations on multiple tasks; appraisal of employees helps to measure

employees efficiency for the job assigned to an employee. Measuring performances of

employees also helped to gain productivity for organizations; Compensation signifies that

the rewards given to employees were as per their performance to encourage employees to

contribute towards the fulfilment of the company goals. Understanding the workforce and

recognizing what their employees find rewarding acts as, an effective reward; promotion

policies help to motivate employees by means of reward systems contributing to increase

productivity. Motivation through, rewards also contributed towards higher market value of

the company and positively related to employees satisfaction and commitment; managing

workforce diversity maximizes the utilization of employees potential and recognized the

differences among workforce.


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Thus, organizations need to successfully manage different groups; and finally outsourcing

services such as hiring, training and many other services helps to overcome complexities

and competition of business environment. To get insight on Human Resource Strategies

prevailing in Banking Organizations Respondents were questioned.

In response to a question manpower planning is efficient in terms of right person at the

right place and at right time from 186 Respondents, 65 percent Respondents agreed and

2 percent Respondents strongly agreed that organizations used their manpower to the best

by placing right person at right place and at right time. Whereas 31 percent Respondents

disagreed that, there existed hardly any proper utilization of the manpower (Chart IV.

13).

In response to a question there are strategies to control personnel cost to as low as

possible from 186 Respondents, 72 percent Respondents agreed and 16 percent

Respondents strongly agreed that their organizations designed strategies towards

controlling the manpower cost. Whereas, 13 percent Respondents disagreed, indicating

that their organizations did not paid attention towards cost reduction (Chart IV. 13).

In response to a question your organization is able to attract the best talent from 186


agreed that their organizations were able to attract best talent available in the market.

Whereas, 17 percent Respondents disagreed that their organizations lacked in attracting

the cream talent from the market (Chart IV. 13).


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In response to a question employees are provided guidance and given training from 186


agreed that in their organizations they were guided and provided with knowledge to work

in new areas .Whereas 17 percent Respondents disagreed that hardly any emphasis was

given to guide employees for new responsibilities (Chart IV. 13).

In response to a question employees take responsibilities of the decisions made by them


strongly agreed that they were assigned job profiles and designations appropriately.

Whereas, 2 percent Respondents disagreed that they were not clear about their job

profiles and their designations and 1 percent Respondents remained neutral on this aspect

(Chart IV. 13).

In response to a question there is a continuous effort to improve skills and competency of

employees from 186 Respondents, 48 percent Respondents agreed and 42 percent

Respondents strongly agreed that their organizations emphasized on improving

employees competencies and skills. Whereas 9 percent Respondents disagreed that, their

organization hardly emphasized on talent improvement and 1 percent Respondents

remained neutral on this aspect (Chart IV. 14).

In response to a question employees efficiency is closely measured from 186


agreed that in their organizations their performances was monitored continuously.

Whereas 11 percent Respondents disagreed that, their organizations hardly paid any

attention to measure employees efficiency (Chart IV. 13).


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In response to a question better performance is facilitated by rewarding employees from


agreed that in their organizations rewards were linked to performance of an employee.

Whereas, 6 percent Respondents disagreed and 2 percent Respondents strongly

disagreed that hardly any emphasis was made on reward based performance by their


In response to a question recognition, rewards are as per merit and on long-term basis


strongly agreed that their organizations gave recognition and reward as per merit.

Whereas 17 percent Respondents disagreed that, hardly their organizations considered

merit as a basis to reward their employees (Chart IV. 13).

In response to a question all groups of the workforce are equally managed (age, gender,

race, religion etc)from 186 Respondents, 69 percent Respondents agreed and 16 percent

Respondents strongly agreed that in their organizations all different groups were

managed well . Whereas, 15 percent Respondents disagreed that hardly their

organizations paid attention towards managing diversity with respect to age, gender, race

and religion (Chart IV. 13).

In response to a question processes like hiring, training have been outsourced from 186


agreed that theirorganizations had outsourced services. Whereas 3 percent Respondents

disagreed that hardly any services were outsourced (Chart IV. 13).


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Respondent responses were further corroborated with the observations. Banks viewed

manpower planning as integration of strategic and operational plans to ensure future

staffing needs. Public Sector Banks manpower planning focused mainly on the number of

staff members and employees who would be required in the middle management. These

manpower planning were mostly quantitative in nature and determined number of staff

members that Banks would required to recruit for the next few years.

Banking Organizations are continuously reviewing their existing manpower requirements

to manage changes in the market conditions and to keep inventory of skilled personnel to

be utilized for the emerging job requirements. On the basis of revised requirements, Bank

of Baroda and Punjab National Bank recognized the requirement of two Executive

Directors to handle operations of Banks, as these two Banks were very large Banks. For

the purpose of manpower planning Banks had taken help of technology. For instance, State

Bank of India being one of the largest Bank in India has developed Human Resources

Management System also known as SBI HRMS Portal, which helped in doing resource

planning effectively and also reduced the cost factors related to manpower.

A decade back Banks faced a lot of Human Resource wastage due to the disparities

between the demand and supply of manpower. Today Banks are making efforts to

overcome these challenges by preparing details such as: surplus personnel existing in one

unit; same skilled personnel again employed in another unit without any redeployment of

surplus employee; and over employment resulting into assigning of work to workers below

their abilities and capacities leading towards wastage. Mostly Private and Foreign Banks

has well prepared Human Resource budget. As a result, their business per employees was

higher as compared to Public Sector Banks.


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Public Sector Banks recruited mostly staff, for which they advertised in the local and

national newspapers and conducted written test, group interviews for selecting candidates.

Banks are also fulfilling the requirements internally by reassignment, re-allocation of the

responsibilities and even internal promotions for their internal candidates. Public Sector

Banks like State Bank of India, Punjab National Bank, Bank of Baroda, Allahabad Bank,

UCO Bank and Canara Bank recruit employees at following levels: Clerks, Junior

Management Grade ScaleI, Middle Management Grade ScaleII, Middle Management

Grade ScaleIII, Senior Management Grade ScaleIV and Top Executive Grade Scale-

V. For these Banks, Banking Services Recruitment Board (BSRB) invite applications for

various posts like - clerks, typist and agriculture clerks and many other for the respective

regions.

Banks like ING Vysya Bank, Deutsche Bank, Barclays Bank and Kotak Mahindra Bank

identified and cultivated strategic talent pools from various resources like universities,

management schools, and community forums. Business Head, Human Resource Head, or

Chief Executive Officer approves recruitment activities in these Banks. Expenditures were

budgeted and pre-approved by Business Unit Heads and Human Resource Heads. One of

the Respondents from HDFC Bank mentioned that to end bulk recruitment they followed

recruitment programmes in following ways: banking on internal network by using talent

pool; and banking on external network by using job portal, direct sourcing, Bank website,

placement agencies, job fairs, print media, and campus hiring. Innovative Human Resource

recruitment processes aided by the latest technology backed all these programmes.


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Banks constituted a huge number of job profiles, which has different responsibilities

associated with them. Different job profiles existed were: customer service, front desk,

cash handling, probationary officer, loan officer, personal loan officer, home loan officer,

home loan agent, loan manager, loan processing officer, accountant, product marketing and

sales executive, recovery officer, retail asset manager, property appraiser, customer service

executive and many others. For instance, job profile of Loan Officer in Canara Bank

includes checking the eligibility of the individuals seeking loans from the Bank. Evaluation

of loan application and probability of loan repayment by customer verified. After this loan

officer recommend or approve loan. HDFC Bank, Relationship Representatives promote

different products and services offered by their Bank. Relationship Representatives were

responsible for opening and closing accounts and keeping a record of all the financial

transactions. Bank of America, Senior Operational Risk Specialist develops risk

management tools, database and prepared appropriate risk metrics and reports. They were

also required to lead process changes at individual unit level.

Skill up-gradation is an important area for Banks. SBI Bank has Strategic Training Unit

(STU) focused on skill up gradation of employees in view of expansion, changing business

environment, and competition. Employees had to attend a two-week training programme

once in 18 to 24 months. This training unit also provided training programmes to other

Public Sector Banks and some Foreign Banks on their request on cost-to-cost basis 11.


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Chinatrust Commercial Bank provided training to their staff for supervisory roles in

different fields. The supervisory skill training programme included people management,

performance management, presentation and communication skills, and change

management. Finally, skill-building strategies are aimed to achieve following objectives:

developing service orientation; focusing on the customers needs ; collaborating with the

client ; awareness about customers satisfaction ; skills to seek information about the real

underlying needs of the customers ; and development of skills to rapidly changing

environment .

Indian Banks Association suggested re-naming Annual Confidential Reports as Annual

Performance Assessment Reports and its contents to be shared with the officer

concerned12. There also existed a provision in this report that if any employee does not

agree with the appraisal grading then they are free to raise their comments against the final

grading, but within a stipulated period of receiving the report. Mostly Banks carried

appraisal processes once in a year. But, there also existed few Banks like ICICI Bank in

which performance appraisal was carried out twice a year and on the other hand, HDFC

Bank does it regularly with the help of Management Information System with which

performance was calculated and monitored across the regions and branches. Centurion

Bank of Punjab has online appraisal system used for conducting performance appraisals

during the year.


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The appraisal report constituted of appropriate list of objectives, which could clearly

demonstrate the performance of an employee. For instance, State Bank of India appraisal

form consisted of two parts. Part A consisted of details regarding employees duties and

responsibilities, objectives to be achieved by employees in a stipulated period of time,

employees capabilities in different areas required for the current role requirements (Scale:

1 to 3 poor, 4 to 6 satisfactory, 7 to 9 good, 10 excellent), and employee job aspirations;

and Part B consisted of details listed by appraiser on appraises objectives achieved,

appraises career direction options and wishes, and readiness for promotion. It also

constituted of key responsibility areas considered such as: loan disbursement, bad loan

recovery, fee-based income, and the number of new account added were used for

evaluation of employee performance 13.

Private Sector and Foreign Sector Banks has given competition to Public Sector Banks as

they offered much more attractive pay components. Public Sector Banks followed an

industry-wide norm fixed by Indian Banks Association in consultation with Government

of India, Ministry of Finance, New Delhi 14. Salaries offered by Private and Foreign Banks

included a significant variable component linked to performance and this resulted into

salary differential as high as 200 to 400 per cent. Government fixes the salaries for Public

Sector Bank chiefs. Private Banks needed a clearance from Reserve Bank of India for

remuneration to their top executives, but there existed no cap on it.


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Banks had adopted policy measures to achieve greater participation from women

employees. Women had taken employment in Banks on a priority basis as these

organizations had gender sensitive work culture and relatively unrestricted environment

with flexible timings. For instance, following Banks showed impressive malefemale

ratios employed in their organizations: HSBC Bank male-female gender ratio was

64.5:35.5 in India out of which 50 percent of the top managers were women. HSBC Bank

has also set up a task force of 100 employee s consisting largely of women business heads,

to pursue gender diversity 18; ICICI Bank has 70:30 male-female ratios; Axis Bank claimed

that in metro branches, there ratio was even higher at 40 percent; Standard Chartered Bank

male-female ratio of employees in India was 69:31. Private and Foreign Banks were ahead

of Public Sector Banks with a healthy ratio of 30 percent 19. On the other hand Public

Sector Banks provided job reservations to scheduled castes, scheduled tribes, other

backward classes, disabled persons, and ex-defence and para-military personnel.

Banking Industry had experienced the need of infusion of some developmental services

from outside to augment the internal knowledge capacities. Banks had adopted outsourcing

strategies due to the following reasons- it helps in cost reduction through process

improvement and control; it helps Banks to concentrate on its core business areas instead

of back office operations; it helps to make services flexible to meet the changing

customers requirements. For instance, IndusInd Bank has entered into an infrastructure-

on-demand agreement with IBM India, which included building an Information

Technology infrastructure, implementing server consolidation, and setting up disaster

recovery systems. This partnership also supported Banks goal to become totally customer-

centric by providing more secure, responsive, and efficient services. It also allowed Bank

to scale up the operations and pursue aggressive growth plans as well.


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CHART IV. 14

HUMAN RESOURCE STRATEGIES IN BANKS

0%

0%

0%

2%

0%

0%

0%

0%

0%

0%

0%

3%

15%

17%

6%

11%

9%

2%

17%

17%

13%

31%

0%

0%

0%

0%

0%

1%

1%

0%

0%

0%

0%

53%

69%

67%

58%

70%

48%

53%

73%

62%

72%

65%

44%

16%

16%

34%

19%

42%

44%

10%

21%

16%

4%

Outsourcing

Managing Workforce Diversity

Promotion Policies

Compensation Realignment

Appraisal of Emplyoees

Skill up-gradation

Job Profile and Designation

Deployment

Talent Acquisition

Cost Controlling of Manpower

Manpower Planning

Strongly Agree Agree Neutral Disagree Strongly Disagree


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Customer retentionwas emphasized repeatedly to employees, because without customers

an organization would not have any revenues, profits, and consequently no market value.

Customer orientation among employees needs to be included as it helps to build customer-

oriented attitude of employees. Thus, organizations must emphasize to consider their

customers as valuable. Employees learning how to build customer relationship help

employees to select the right kind of customer. As it could not, be desirable or even

possible to create relationship with all customers. To learn to build relationship with

customers employees need to accurately identify changing customer needs and develop

new complex products to satisfy their needs and to provide higher levels of customer

services. Thus, product innovation has emerged as a significant feature to meet needs of

customers.

A greater use of Human Resource Practices was associated with the higher level of

productivity and excellent services. Quality services in Banks referred to as right service at

the first time. Apart from quality services, Banking Organizations need to provide

convenient services to their customers. Thus, organizations services procedures needed to

be as per customers handiness. Ultimately, all these strategies helped to achieve customer

satisfaction. To get insight on customer relationship strategies Respondents were

questioned on these.

In response to a question each customer is considered valuable from 186 Respondents, 65

percent Respondents agreed and 26 percent Respondents strongly agreed that they

considered each customer as valuable and paid attention towards relationship building.

Whereas 9 percent Respondents disagreed that, their organizations were not vigilant on

customer relationship building (Chart IV. 14).


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In 2009, Bank launched another programme; Citizen SBIaimed at attitudinal change and

transformation of their employees, through a series of Human Resources activities. Union

Bank of India conducted Customer Day in all their branches on 15th of every month

where employees interacted with customers. Customer empowerment through customer

education was the key tool adopted by Banks. Towards this end, Bank had come out with a

Citizens Charterin September 1997. Citizens Charter encompassed most of the Bank

operations. This has been prepared to promote fair Banking practices and to give

information with respect to various activities, related to customer services.

Union Bank of India, HDFC Bank, ICICI Bank, Axis Bank and many other Banks have

provided call centre services to their customers. In these call centres, customers could

record complaints and deficiencies in the services provided to them by Bank. Banks had

also enabled online grievance redressal mechanism whereby grievances could be lodged

online for speedy redressal of any complaint. In addition to these Banking Codes and

Standard Board of India (BCSBI) had set minimum standards to be practised by Banks

while dealing with individual customers. These standards provided protection to customers

and explained to Banks how to deal with customers for their day-to-day operations. Banks

provided clear information about their products and services and details about the terms

and conditions like interest rates or any service charges. In order to make exchange of

information easier Banks provided information to their customers in Hindi, English or

other appropriate local language.


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The customer-oriented strategies helped Banks to retain customers and improve quality of

services. Banks benefited as increased investment in technology to handle complaints of

customers was prompt. Customer-oriented strategies also benefited customers by moving

customers to lower cost automated channels, such as Automated Teller Machines and

online Banking to make services convenient for customers.

CHART IV. 14

CUSTOMER RETENTION STRATEGIES BY BANKS

0% 0% 0%

5%9%

1%

8%11%

0% 0% 0% 1%

65%

44%

58%

73%

26%

55%

35%

9%

CustomerRelationship

Product Innovation Service Quality Convenient Services



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Cross-cultural Differences Influencing Human Resource Strategy Formulation and

Implementation

Management of cultural diversity needs to be included in theHuman Resource Strategy

enabling the effective management of workforce differences created due to demographical

changes. Human Resource Strategies must be aligned with the cultural differences because

organizations cannot treat their workforce as a homogeneous workforce. Thus, Human

Resource Strategies formulated should have inclination towards the cross-cultural

differences existing in their organization.

In response to a question while formulating Human Resource Strategies, are cultural

differences between headquarters and branches considered from 186 Respondents, 56

Respondents agreed and 15 percent Respondents strongly agreed that cultural

differences were included in the Human Resource Strategies. Whereas 20 percent

Respondents disagreed and 2 percent Respondents strongly disagreed that hardly any

cultural differences were included in the Human Resource Strategies, and 6 percent

Respondents remained neutral on this aspect (Chart IV. 15). Even during various seminars

and summits Human Resource practitioners and key Banking, personnels has mentioned

that organizations need to take seriously into account the cultural differences.


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performance. Third, control process refers to how people to be treated 21. It is essential that

organizations approach of controlling their employees must be acceptable to their

employees, according to their cultural backgrounds. Fourth,formality refers to how the

exchange of information took place. Fifth, there should be both upward and downward

communication with the use of appropriate communication channels in the organization.

Sixth, differences existing among workforce with respect to identity. This refers to whether

employees identified themselves with their organizations22

. Signifying that in

organization individual must view themselves with organizations. To get insight on cross-

cultural aspects Respondents were questioned on these.

In response to a question differences in opinions are accepted liberally among employees


strongly agreed that their opinions were accepted liberally in their organizations.

Whereas, 13 percent Respondents disagreed that hardly any attention was paid towards

employees opinions and 1 percent remained neutral on this aspect (Chart IV. 16).

In response to a question completing an assigned task timely is considered as a significant

measure in your organization from 186 Respondents, 48 percent Respondents agreed

and 41 percent Respondents strongly agreed that they completed their tasks within the

stipulated time period assigned to them. Whereas 11 percent Respondents disagreed that,

hardly any importance was given towards completion of task on time by their



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200

In response to a question your organization have a well defined structure for decision-

making from 186 Respondents, 81 percent Respondents agreed and 8 percent strongly

agreed that the way they were controlled in their organization was acceptable to them.

Whereas, 9 percent Respondents disagreed that they did not liked the way employees

were commanded and 2 percent Respondents remained neutral on this aspect (Chart IV.

16).

In response to a question managers and co-workers provide mutual support from 186

Respondents, 53 percent Respondents agreed that information flow in their organization

was irrespective of hierarchy levels. Whereas, 45 percent Respondents disagreed and 2

percent Respondents strongly disagreed that communication flow was strictly within the

hierarchy levels (Chart IV. 16).

In response to a question your organization allow open communication to employees


strongly agreed that they could communicate openly. Whereas, 15 percent Respondents

disagreed and 2 percent strongly disagreed that they were hardly allowed to express

freely and 1 percent Respondents remained neutral (Chart IV. 16).

In response to a question there exist shared purpose among employees from 186


agreed that they identified themselves with their organizations. Whereas, 11 percent

Respondents disagreed that they did not viewed themselves associated with the

organization and 2 percent Respondents remained neutral on this aspect (Chart IV. 16).


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201

Respondent responses were further corroborated by the following observations:

Organization and individuals time orientation needed to be matched for better

performance. Time emphasis might differ from Public Sector to Private Sector to Foreign

Sector Banks. Even in few advertisements Banks had shown emphasis on time for their

organizations. It was recognized that top leadership of organizations clearly determined the

time orientation for the organization as a whole, so that the decision-making and assigned

tasks completion move in consistent manner within organization. Another difference,

which gave rise to conflict, was the ways in which employees were controlled. Mostly in

Private and Foreign Sector Banks and in few Public Sector Banks, Bank Managers were

visible to their employees, for example by walking and gathering information. However,

managers who commanded too obviously or involved themselves in the work details of

employees might de-motivate employees who take pride and honour in their work.

Documents

Implementation OF HRM strategies