Training and Development in Regional Rural Banks

(A Study in Andhra Pragathi Grameena Bank Andhra Pradesh India)

*Dr. S.Md. Ghouse Introduction

** B. Ismail Zabiullah

*** R. Varaprasad

Training and Development is essential to the ongoing success of every organization. Employee training and development enables employees to develop skills and competencies necessary to enhance bottom-line results for their organization. It is a subsystem of an organization. It ensures that randomness is reduced and learning or behavioral change takes place in structured format. Training and development is vital part of the human resource development. It is assuming ever important role in wake of the advancement of technology which has resulted in ever increasing competition, rise in customers expectation of quality and service and a subsequent need to lower costs. It is also become more important globally in order to prepare workers for new jobs. In this paper an attempt is made to focus on the training and development practices and its implications on individuals and employers in Anantha Pragathi Grameena Bank, a regional rural bank in the rayalaseema region of Andhra Pradesh. Regional Rural Banks in India An overview The history of regional rural banks in India dates back to the year 1975. It's the Narsimham committee that conceptualized the foundation of regional rural banks in India. The committee felt the need of 'regionally oriented rural banks' that would address the problems and requirements of the rural people with local feel, yet with the same level of professionalism of commercial banks. Five regional rural banks were set up on October 2 with a total authorized capital of 1 crore, which later augmented to 5 crore. There were five commercial banks, viz. Punjab National Bank, State Bank of India, Syndicate Bank, United Bank of India and United Commercial Bank, which sponsored the regional rural banks. The equities of rural banks were divided in a proportion of 50:35:15 among the Central Government, the Sponsor bank and the concerned State Government. Andhra Pragathi Grameena Bank- An overview Andhra Pragathi Grameena Bank came into existence from 01.06.2006 by amalgamating Rayalaseema Grameena Bank, Sri Anantha Grameena Bank and Pinakini Grameena Bank consequent upon the Government of India Notification dt.01.06.2006. The Bank is constituted under Regional Rural Banks Act 1976. The Bank is having its Head Office at KADAPA with a jurisdiction of 5 districts namely Kadapa, Kurnool, Ananthapur, Nellore and Prakasam. The Bank is having 6 Regional offices with its Head quarters at 5 district Head Quarters and in Kadiri of Anantapur district. The Bank is providing banking services with its 426 branches and 3 Extension counters as on 31.08.2012. The Bank is catering to the needs of Rural Poor mainly and to all other sectors also. The Bank has been playing a pivotal role in economic development of its operational area by outreaching the people in the countryside. The Bank stood First in earning Net profit of Rs.150.44 Crore as on 31.03.2012 among all RRBs sponsored by Syndicate Bank and all RRBs in the Andhra Pradesh State.
*Head, Department of Management Studies, GATES Inst of Tech, Gooty, 515401, AP, India ** & *** Assistant Professor, Department of Management Studies, GATES Inst of Tech, Gooty, 515401, AP, IndiaPh: 9701852327, 9700036453, E-Mail: rvaraprasad@gmail.com 1

The entire area of operation of the Bank, which is mostly in Rayalaseema region, is characterized by drought and backwardness. About 75% of the population in the area lives in countryside. The soils are mostly black and red, about 75% of the area is rainfed and farmers depend on rainfed crops. Under Irrigation sources viz., canals, tanks, borewells etc., the major crops grown are paddy, cotton(hybrid), chillies, vegetables, horticulture crops like banana, papaya, sweet orange, mango etc., and under rainfed conditions the major crops grown are ground nut, jowar, bengalgram, sun-flower, coriander, tobacco, etc. The area is rich in minerals viz., barites, limestone, granite, black and colour slabs, slates etc The important rivers flowing through the Bank's area of operation are Krishna, Tungabhadra, Hundri, Pennar, Kundu, Papagni, Chitravathi, Sagileru, Pincha, Cheyyeru, Swarnamukhi, Paleru, Pillaperu and Gundlakamma . The Government of Andhra Pradesh awarded 'BESTBANK award to the bank on 17.01.2007 and on 15.01.2010. The paid up capital of the Bank is Rs.300 lakh, contributed by the Govt.of India, Sponsor Bank (Syndicate Bank) and the Government of Andhra Pradesh in the ratio of 50:35:15 respectively. As a part of restructuring process of RRBs, an additional share capital (in the form of share capital deposit) of Rs.3934.26 lakh was infused by the shareholders in the ratio mentioned above. Objective To examine the training and development practices in Andhra Pragathi Grameena Bank To analyze the Impact of Training and development on employee performance Methodology: In order to achieve the objectives stated above both primary and secondary sources of information are collected. The primary data was collected through a structured questionnaire apart from discussion and interviews with employees of different cadres and officers of the bank. Employee questionnaire is focused on back ground of employees Training and Development , secondary data was collected from reports, circulars of the bank, books, journal articles, news papers, e-resources, etc., The data was collected through structured questionnaire supported by participant observation. The data gathered through questionnaire was in the form of ranks given by employees to different types of training methods. standard deviation was used to analyse the data Sampling In Andhra Pradesh there are five Regional Rural Banks among them Andhra Pragathi Grameena Bank sponsored by syndicate Bank is the largest Regional Rural Bank with 360+ branches in Andhra Pradesh, hence the researches have selected Andhra Pragathi Grameena Bank for the purpose of study. The bank has 1865 employees working at different hierarchies; Head Office is located in Kadapa of YSR District of Andhra Pradesh. The Andhra Pragathi Grameena Bank has 5 regions they are Anantapur, Cuddapah, Kurnool, Nellore and Ongole the sample randomly covers all 5 regions for the purpose of study. Training and Development in Andhra Pragathi Grameena Bank

The training system is one of the significant sub-systems of HRM that facilitates growth of employees and the organization. The training methodology adopted then suited the environment of that day which did not call for intensive training. With very few products, limited customer base and lesser competition, it was easier and sufficient to train the workface without much institutional effort. Rapid branch expansion, increased competition, diversified business activity such as Agriculture, industry etc., and the fast changing environment brought in new challenges to the bank in the development of employees. The coaching and training given by the agents, though important were not sufficient to respond to the demands generated by the increased need for knowledge, skills and competencies. Institutional training in this bank came in response to this challenge in order to address the competency gap. In the context of amalgamation of RRBs and the problems being faced by them, the Honorable Union Finance Minister in the 2ns meeting to Review the Performance of RRBs convened by GOI on 16th July 2007, directed that all Officers and staff of RRBs should be given adequate training in computers and other banking skills as also attitudinal training for dealing sympathetically with rural clientele. He also advised all the sponsor banks to prepare suitable training modules in consultation with bankers Institute of Rural Development (BIRD) for the purpose. Areas Covered by the Existing Training Arrangement in Andhra Pragathi Grameena Bank In Andhra Pragathi Grameena Bank generally both Officers (Group-A), Clerical Staff (Group-B) received training in business areas. HRM and Information Technology in addition, Officers received training on Planning and Internal Controls, While clerks received training on Accounting Procedures. The Group-C (Subordinate) staff received training on Banking Trends. HRM, Disciplines Staff matters NPA recovery and Microfinance. Areas of Training in Andhra Pragathi Grameena Bank The training provided to different employees are different based on the type of service, as the employees are grouped in Group A, B and C Areas of Training for Officers (Group-A) Group-A officers train in different areas like General Bank Management, Planning and Strategizing, External and Internal Controls, Human Resource Management and Computer Information Technology. Training on General Bank Management: General Bank Management Covers following areas that are listed below. 1. Rural Banking 2. Credit Management 3. Recovery Management 4. Deposit Mobilization 5. Investment Management 6. Marketing of Bank and its products 7. Customer Service Training on Planning & Strategizing: Strategizing Management Covers following areas that are listed below. 1. Business Planning 2. Business Development and Market Analysis 4. Asset Liability Management 5. Monitoring Information System (MIS) 6.Costing and Pricing of Products
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Training on External & Internal Controls: External and Internal Management Covers following areas that are listed below 1. Code of Conduct 2. Vision, Mission and Goal Setting 3. Internal Control and Auditing 4. Regulations, External control and Auditing Training on Human Resource Management: Human Resource Management Covers following areas that are listed below. 1.Human Resource Development 2. Communication Skills 3. Team Building and conflict Management 4. Leadership 5. Negotiation skills for NPA Management Training on Computer and IT: Computer and IT Management Covers following areas that are listed below. Handling of Computer Applications Areas of Training for Office Assistants (Multipurpose) (Group-B) Considering that Andhra Pragathi Grameena Bank Branches are units manned by two to three persons, the Office Assistants (Multipurpose) staff plays a vital role in the business development of the bank. They are often the first level of contact for the customers and are crucial for the effective management of the branch and for the conduct of the daily business. They are also responsible for assisting in preparation and implementation of business plans and policies. They prepare all periodic financial and non-financial reports necessary for monitoring and assessing the activities and performance of the branch. Areas of Training for Office Assistants (Multipurpose) (Group-B) Group-B office Assistants train in different areas like Business Skills, Accounting, Human Resource Management & Computer and IT Training on Business Skills Management: Business Skills Covers following areas that are listed below. 1. Code of Conduct 2. Business Development 3. Credit including loan recovery Management 4. Deposit Mobilization 5. Non-Financial Products 6. Marketing and Customer Satisfaction 7. Internal Control 8. Regulations, External Control and Auditing Training on Accounting Management: Accounting Covers following areas that are listed below. 1. Balance Sheet and Final Accounts 2. Account Re-conciliation Training on Human Resource Management: Human Resource Management Covers following areas that are listed below. 1. Communication 2. Customer Relationship Management 3. Negotiation Skills for NPA Management Training on Computer & IT: Computer & IT Covers following areas that are listed below. Handling of Computer Applications Areas of Training for Office Attendants (Multipurpose) (Group-C)

In Andhra Pragathi Grameena Bank the Office Attendants (Multipurpose) Group-C staff are the least trained. However the trend is now being reversed with most of the RRBs recognizing that the subordinate staff in many cases, is the first contact point for the customer. A few RRBs have made arrangement for training the subordinate staff through on-location programs while some in South have tied up with institutes such as National Institute of Rural Banking (NIRB) for conducting training programs for them. Group-C Office Attendants train in different areas like Personality Development, Attitude Development and SHG Lending
Training in external training institutions for officers group-A and Office Assistants Group- B

After NABARD set up BIRD in 1983, it went persuading sponsor banks and Andhra Pragathi Grameena Bank to give greater attention and priority to training of Andhra Pragathi Grameena Bank staff. As a result of this and other positive developments, many TEs of sponsor banks started allotting dedicated space for Andhra Pragathi Grameena Bank staff in their training activities. NABARD too went on to set up two regional training centers one in the South and the other in the East part of the Country. Thus, at present, the training requirements of RRBs are being taken care of by the institutes listed in table . Except a few Training Centers of some of the Sponsor Banks, none of these Training Establishments (TEs) have been providing training facilities for the Officer Attendants (Multipurpose) Group-C of Andhra Pragathi Grameena Bank. Further the Office Attendants (Multipurpose)Group-C staff of Andhra Pragathi Grameena Bank is not provided training at any of these TEs Important training establishments providing training to APGB employees
S. No 1 2 3 4 5 Name of Training Establishment Bankers Institute of Rural Development Lucknow College of Agriculture Banking, Pune Indian Institute of Bank Management, Guwahati National Institute of Rural Development, Hyderabad Staff Training Colleges of Commercial Banks Regional Training College, Bolpur Regional Training College, Mangalore Regional/Zonal Training Centres of Commercial Banks Promoted/Supported by Level of Andhra Pragathi Grameena Bank Staff Trained Officers Officers Officers Officers Officers Officers Officers Officers & Office Assistants Officers Group-A, Office Assistants-Group-B, Office Attendants Group-C

NATIONAL LEVEL NABARD RBI RBI, NABARD & Commercial Banks Govt. of India Respective Commercial Banks REGIONAL LEVEL NABARD NABARD Respective Commercial Banks STATE LEVEL Respective Commercial Banks

6 7 8

9 Staff Training Centres of Commercial Banks

Training in internal traininig institutions for officers, office assistants group B and office attendants group C 1. RBTC Anantapur 2. Rudset Sponsored by Syndicate Bank 3.Andhra Pragathi Grameena Bank has their own setup of training centres like RBTC Anantapur, Rudset Sponsored by Syndicate Bank.
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Selection of Trainees for Training Training requirements are assessed once in a year strictly based on the half yearly review. These training requirements are monitored by the external institute. Training requirements are assessed once in a year strictly based on the yearly performance review reports. It is the method of performance Analysis. Performance Analysis is the process of verifying that there is a performance deficiency and determining of such deficiency should be corrected through training. The training requirements are monitored by External Institute. Selection of Trainers Banks will issue a circular that are willing to give training based on their capabilities. They will be given a topic for demonstration which would last for about one and half hours for each person. These persons are judged by two senior Assistant General Managers. After the trainers are selected by AGMs, interview will be followed. Finally trainers are selected who perform very well in the interview. In the above process the resource persons of the training programmes are mostly taken from commercial banks RBI and sponsoring bank who are generally unaware of the rural of local problems. The rural and local problems are known to the senior officers of RRBs. Therefore the resource persons are to be deployed from the RRBs. Training of Employees in 2009 2010 The bank has attached utmost importance in training the staff members on various subjects to improve their skills for Business Development. The Details of number of staff trained (Cadre Wise) during the year are given in the table 4.8. Staff trained during 2009 2010
Sl. No Particulars Officers Group-A Office Assistants Group-B Office Attendants Group-C Total

External Training 101 Programmes 2 RBTC Anantapur 755 335 3 Other Training Programmes 707 4 Total 963 335 Source: 2009 2010 Andhra Pragathi Grameena Bank Annual Report

40 40

101 1130 107 1338

The above table describe the employees training scenario, according to above table total 963 Officers trained out and out of 963 101 Officers trained in external Institutes, followed by total 335 Office Assistants and 40 Officer Attendants trained through (RBTC) Regional Bank Training Centre) There is no provision of proving lodging and boarding facilities to the clerks who undergo training programme at head office. Hence many of the clerks are reluctant to participate in such programmes. Therefore it is suggested to provide lodging and boarding facilities to clerical staff to participate in the training programmes. Attitude of employees towards training In view of the importance of training an attempt is made in this study to examine the attitude of employees towards training. The attitude of employees towards training is given in the table 5.10. The training programme should focus on knowledge skills and attitudes of the employees.
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Attitude of employees towards Training in APGB

S. No. 1 2 3 4 5 Statement Knowledge, skills and attitude are the focus of training Methodology of institutional training is serious Methodology of institutional training fulfilled Course design is well equipped with all parameters Whether training organizations provide conducive climate for learning Ratings (Weighted average) Officer 3.49 (.298) 3.57 (.232) 2.69 (.185) 3.71 (.280) 2.56 (.152) Clerk 2.97 (.183) 2.55 (.115) 2.47 (.182) 2.49 (.183) 2.43 (.149) Sub-Staff 2.50 (.140) 2.91 (.210) 2.36 (.127) 2.68 (.116) 2.73 (.103)

Source: Information collected through employee questionnaireNote: Figures in parentheses are standard deviation

The table 01 reveals that officers rated the training programme focus on knowledge, skills and attitude above moderate level (3.49). The other two groups weighted average ratings are below moderate extent. It is not officers alone the other two class employees are also important in the bank. Hence it is suggested that training programme for clerks and sub-staff should also focus on imparting knowledge skills and developing positive attitude in the employees. Effectiveness of institutional training In the institution training the effectiveness of training will be based on ease study, conferences, lectures etc. On the job training is the most effective method as the trainee learn by experience making highly competent. The method is least expensive. It is highly motivated by employee to get through the work done. Institutional training enables employees to perform the job effectively The adoption of institutional training makes employees to make aware of the importance of job how to be performed the work effectively. To know the performance of employees how effectively the work is performed, an enquiry is made in the study. Here the weighted averages rating in the table 5.11 officer is 3.89 which is more than moderate level. The clerks and substaff have been rated 3.56 and 2.41 respectively. In view of this the officer and clerks are effectively working which has crossed above moderate level rather than sub-staff. Hence the sub-staff should get better training to work impressively. Effectiveness of Institutional training
Sl. No. 1 2 3 Statement Institutional training enables employees to perform the job effectively Whether staff college are well equipped with all the advanced machinery like projectors etc. to give proper institutional training. Training need assessment is done properly Ratings (Weighted average) Officer Clerk Sub-Staff 3.89 3.56 2.41 (.209) (.283) (.153) 2.67 2.59 2.41 (.169) 2.58 (.156) (.124) 2.47 (.182) (.103) 2.36 (.192)

2.79 3.17 2.77 (.135) (.261) (.129) 3.84 3.10 2.95 Training faculty members are cordial in clearing employees 5 doubts. (.244) (.244) (.190) Source: Information collected through employee questionnaireNote: Figures in parentheses are standard deviation 4 Trainers (faculty) have through knowledge about the subject.

Employee Satisfaction towards Institutional training The institutional training should make the employees satisfied with their training motives, and make the employee to get well educated and equipped with all the modern trends to make aware and educated them by rendering total support in all the activities to satisfy the trainees in the organization. Satisfaction of employees towards institutional training
Sl. No 1 2 3 Statement Whether staff colleges are effective in providing the effective skill to employees. Whether you are satisfied with existing system of institutional training. Whether institutional training addresses the competency gap among the employees in APGB Ratings (Weighted average) Officer Clerk Sub-Staff 3.57 2.54 2.59 (.214) (.182) (.103) 2.58 2.72 2.41 (.179) (.143) (.103) 2.37 2.52 2.18 (.172) (.175) (.133)

Source: Information collected through employee questionnaireNote: Figures in parentheses are standard deviation

To know the staff colleges are effective to employees, a survey has been measured as the officers weighed average ratings is 3.57 which is above moderate level and whereas clerks and sub-staff are given rating less than moderate level. This shows that staff colleges are providing effective skills only to officers but not sub-staff and clerks. It is suggested that the staff colleges should be effective primarily and secondarily they should have well trained employees who can support the employees who are below the knowledge level also. This should be done by trainees. It should be more positive and effective. Satisfaction of employees with the existing system of institutional training is enquired. The officer gave weighted average rating of 2.58 and sub-staff and clerk are also given rated below moderate level. It shows the employees are not satisfied with the existing system. Hence it is suggested the existing system should be enhanced by equipping with modern techniques and the new trends that are introduced globally in various training institutions so as the employees will be completely satisfied by the training institutes. The competency gap among the employees in APGB should be addressed by training institute. In this APGB organization according to the survey held the officer; sub-staff and clerks are rated below modern level. This shows that institutional organization expanding up to a small extent the competency gap. It is suggested that institution should address and train the competency gap between the employees for the development of the organization. It should be viewed and explained to make aware of the employees of the competency between the employees to reach acute point. Competency gap would be reduced through shared learning. Findings 1. Accommodation was not provided to the clerical cadre trainees
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2. Only class room teaching method is adopted in the training and development program. 3. Locally available resource persons are only invited to impart training. 4. Absence of serious learning culture and climate Suggestion 1. Comfortable Accommodation should be provided to all the trainees irrespective of the cadre. 2. Modern on job training methods should be incorporated in the training program. 3. Subject experts from various apex institutions with in the country should be invited to impart the training. 4. Operational aspects should be given importance in the training with seriousness in it. Conclusion Training and Development is the life blood for any organization, more so far banking sector. It will bring new glory and charms to the jobs and organization as well, it enhances the employee performance, quality of work, satisfaction and output of each and every job. The need of the hour is to change the mind set of policy makers and employers with regard to training and development programmes and its adoption in their respective organizations. Reference 1. Rao. T.V - Planning for Human Resource Development published in vikalpa, 1987,12(3) 2. Bhatia S.K Trends in Training and Development Published by Indian journal of Training and Development, Vol 11 No 4, Indian Society for Training and Development 1981 3. Subba Rao.P Personal and Human Resource Management, Himalaya Publication House, Mumbai, 2008 Websites www.apgb.in; www.rrb.com; www.nabard.co.in