Chapter-1 Objective: Human Resources Practices in Banks Ty Bbi Sem - V

Human Resources Practices in Banks TY BBI SEM - V
CHAPTER-1
OBJECTIVE
 Understanding the importance of the HRM in banks.
 Gaining much better understanding of the HRM process and its activities.
 Identifying how human resources have to be managed, monitored and
controlled at all levels.
 To learn the modern methods of HRM
1.1 Definition:-
“Wendell French” describes Human Resources Management as “the
philosophy, policies, and practices related to the management of people within the
organizations”.
Human resources management is about managing people. It is a process of binding
people and organizations together so that the objectives of each are achieved.
1.2 Meaning of “Human Resource” in Banks:-

Human resource is one of the natural resources of any country's
economy. It is the wealth of the country. In the context of banking, human resource
is of greater importance. The deployment of human resource through proper and
efficient selection, training and development, is called Human Resource
Management. The success of any bank largely depends on efficient human
resource management, apart from operations, marketing and sales, the HR
KES SHROFF COLLEGE OF ARTS & COMMERCE Page 1

department manages all the efficient people working in operations and marketing
divisions in any organization.
1.3 Introduction:-
The banking sector has been an instrument for the economic development of
any nation and its role in a developing nation like ours is of vital importance. Globally,
the banking activities are undergoing raid diversification. In order to maintain their status
in the present competitive enviornment, banks have to concentrate in their human
resources. It is an essential process for every organisation, for the optimim utilisation of
its human resource, involves both the parties for their mutual benefit consequent to the
attainment of the organizational objectives.
Technological changes have become the very essence of the banking sector and
the Indian Banking Sector is also prone to these changes. In any organization, the quality
and amount of productivity mainly depends on the skill and interest of its employees.
Therefore, every business organisation should take the lead for upgrading the skills and
knowledge of its employees for the mutual benefit and progress.
Like any other industrial organizational, banking sector also highly dependent on
the quality of human resources practices for the motivation of its employees. An effective
implementation on human resources practices would result in excellent organizational
climate for the pepole to be competent and productive. Nevertheless, it is not only the
implementation of human resources practices but also their reviews from time to time
helps the banking institution maintain their stats in the competitive environment.

Human resources management is based on four fundamental principles:
(1) Human resources are the most important assets an organization has and their effective
management is the key to its success.
(2) Organizational success is most likely to be achieved if the personnel policies and
procedures are closely linked to corporate objectives and strategies plans.
(3) Organizational culture, values & climate significantly influence managerial behavior
& exert a major influence on the achievement of excellence. Hence continuous effort
starting from the top is required for the management & acceptance of the culture.
(4) Human resources management is concerned with integration getting all members of
the organization involved and working together with a sense of common purpose.
HRM is a management function that helps manager’s recruit, select, train and develops
members of an organization.

1.4 Need of HRM in banks:-

The need of HRD for an organization growth arises mainly due to following
reasons:
(i) The dearth of capable managerial manpower and a greater "need in the
future increase the competition for available talent.
(ii)The continued growth and development of business, coupled with

increased complexities such as the problems of size technology and
competition, add further pressures. "
Similarly, the need of HRD is more in service oriented institutions like

commercial banks. An efficient and effective banking system helps the process of
economic development of any nation as per its priorities. It functions as catalytic
agent for bringing economical. Industrial and agricultural growth and prosperity of
the country. A banking institution is said to be functioning efficiently, only when
the objectives of sound banking system are achieved effectively.
These objectives can be achieved only when the employees of the bank are trained,
satisfied and motivated by the management for the contribution towards
productivity and overall effectiveness of the bank.
Thus, the efficiency and effectiveness of commercial banking would depend upon how
best the management has taken care of the development of its employees working in the
institution.

The need of the HRD in the banking institutions has continuously grown
because of the effective role they are called upon to play in the task of socio - economic
development and rehabilitation of especially those people who were hitherto neglected
and deprived. There are also high expectations of the society from the banking system,
which cannot be met without the development of the integrity, efficiency and behavioral
pattern those who are working in the banks. Besides, the clientele of banking is not only
growing with large increase in population but also getting widely diversified.
Thus, HRD in the context of banking would mean not only the development
of new knowledge and skills of the employees but also "developing capabilities to meet
the needs of both internal and external environment, attaining self - confidence and
motivation for public service. HRD also aims at giving more and more thrust on the
human resource to encourage creativity for the better customer service. HRD efforts in
banks focus on building a strong honesty, integrity and truthfulness. Such efforts try to
culminate in enhancing the bank’s renewal capabilities through competitiveness
innovativeness and creativity.
HRD efforts crystallize the values that are goal supportive and contribution oriented. It
emphasizes the functional style, ethos, culture and work ethics, which are built around
people, manifesting a concern, and is sensitive to the needs of the organization. The
entire philosophy of developing an employee in banks rests on ‘building a holistic person
by framing his personality, character and a way of life”

The HRD policy in the banks has to act as an effective instrument to encourage
employees, to show creativity, to reach for excellence and finally to render better
customer service. Thus, the objective of HRD in banks can be listed as:
 Creaing a climate of openness and trust;

 building a collaborative culture whereby everyone is an important
member of an effective team;
 preparing individuals for technological competence;
 psychological preparedness for willing to participate in change –
implementation;
 promotion human capabilities and competencies in the organization;
 facilitating to build a strong character of honesty and integrity in
performance;
 helping the individual to develop his potential, realize his power so
that he will be able to achieve his self – goals while contributing to the
success of organization;
 improving quality of work life

1.3 Human Resources Management Functions In Banks:-
(1) Human resources planning: -

HRP is the process of forecasting an organization’s
future demand for, and the supply of, the right type of people in the right number. It is
only after this that the HRM department can initiate a recruitment and selection process.
It is a sub-system in the total organizational planning.
It facilitates the realization of the company’s objectives by providing the right type and
the right number of personnel. HRP is variously called manpower planning, personnel
planning or employment planning.
(2) Staffing: -
Staffing or acquisition of human resources is another activity of Human
Resources Management. Staffing activity determines the composition of an
organization’s human resources.
Staffing activities include attracting qualified people to the organization,

selecting from among candidates, reassigning employees through transfer, promotion, or
demotion and ultimately managing the employee separation through resignation,
discharge or retirement.

(3) Training and development: -
This activity of HRM focuses on improving the

performance of individuals and groups within the organization. These activities aim to
help employees learn new skills or refine existing skills.
Human resources managers must decide which skills need development

and which methods are most effective for helping employees acquire skills and
knowledge.
(4) Performance Appraisal and Review: -

Performance appraisal and review is an
ongoing evaluation of individual & group contributions to the organizations and the
communications of those evaluations to the persons involved.
This HRM function is carried out for a number of purposes; to provide feedback about
performance to determine the need for training, to make decisions about promotions, pay
increases and so on.
(5) Compensation and Reward: -

Organizations compensate employees through wages
salaries bonuses, and benefits such as health insurance, vacation time, and pension
programs. The presence or absence of rewards and recognition is important to employee
morale and performance.

Compensation decisions include determining ensuring fair and equitable pay differences
among employees, designing a pay packages relative to that of its competitors, forms of
compensation & so on.
(6) Employee participation: -

This is relatively new function of HRM. Employee
participation focuses on giving employees a voice sharing information with them and
consulting them on matters of mutual interest. Employee participation is an important
step in establishment of industrial democracy.
(7) Organization improvement: -

Organizations must constantly improve themselves
due to emergence of new ideas regarding productivity, rapidly changing technology &
competition from other organizations.
1.4 Role: Human Resources Management In Banks:-
Human Resources Management is concerned with people, performance,

practices, information, work and life. It is concerned with building an infrastructure that
impacts employees, customers and other stake holders. Wherever the HRM the functions
and practices are aligned with overall corporate strategies, business goals are meet and
sustained. Similarly, successful HRM attaches great value to people and creates an

organization which is both competitive and compassionate. Wherever HR develops

professional with appropriate competencies it become the driver of the business by
partnering the development process,
HRM of banking should be no different from the rest of the business. As Indian
Banking starts grapping with issues of globalization, adoption of new technology and
growth driver. Indian Banking is the happening place witnessing exciting days. It would
be interesting to study the role of HRM in the Indian Banking.
HRM did not have a direct role in business development but was more concerned
with centralized recruitment of staff and providing them across the country. The
personnel policies, be it salary or promotion or transfer, were driven by grades and
seniority. Job rotation has been a major plan of developing expertise.
Unlike the past when the balance sheets were not transparent and regulation was not
calibrated, today, bank management is more directly responsible for decision. They have
in addition responsibility towards the shareholders and need to proactively grapple with
many issues. Technology has changed the layout of the workplace. Success of the bank is
measured in terms of the market share, profit and size. The business mix and the focus
have shifted. The management canvass has become vast and challenging.
However, as banking is fundamentally a matter of bank customer relationship, it is

evident that technology can expedite and improve delivery of banking services, but
technology alone cannot drive business development efforts. Actually it is only human

resources that can use the technology efficiently, ensure that the banks perform very well
and play a vital role in the transformation of banks into global leaders. Given this, the
demand on HRM for making available professional to perform new jobs and new
locations is endless
1.5 HRM Challenges for Indian banks:-
The RBI has already prepared the roadmap for major banking reforms and it is only a
matter of time before it is implemented. This roadmap has two distinct phases of change:
(1) In the first phase, foreign banks will be allowed to establish a presence in India
through the wholly owned subsidiary route. The markets will be opened up for the
acquisitions of weak banks that RBI considers are appropriate for acquisitions.
(2) The second and more encompassing phase that the RBI plans to begin from April
2009 is to allow foreign banks to acquire controlling stakes in privately owned Indian
banks. This phase will lay the foundation for open markets.
These major changes will open up a plethora of new opportunities for some Indian banks
but it could also sound the death knell for some banks.
The success and survival of the banks will depends more and more on ‘people
management’ and only those banks that can manage their human resource effectively will
have life in the long run.

If there is any one singularly important lesson that has been learnt from the process of
reforms the world over then that is ‘people’ are the real strength of the organization and it
they who give an organization its competitive advantage.
The quality of HR will be a critical factor in the success of Indian banks especially the
public sector banks (PSBs). As a consequence there is an urgent need for overhauling of
the entire HR in banks and hence effective HRM has become vital. Banks will need to
take a holistic view of HRM for providing qualitative services with minimum cost and
time to the public.
The major HRM challenges that confront the Indian banks and the measures that need to
be taken are discussed here below.
a) Problem of Redundancy:-
A major problem in many PSBs is that many posts in them have

become redundant either due to changes in business procedures or due to the
computerization of branches which started two decades back.
Thus a scientific job and role analysis needs to be done to redefine various positions in
the bank. It is only then that banks will be able to achieve an improvement in their
performance and utilization of manpower. A first step in this direction would be for
banks to start negotiating immediately with their unions for effective redeployment of the
employees.

b) Snail Paced Promotions:-

A recent study found that the present promotion cycle in PSBs for
the serving employees was 11 years. The average age of an employee at different scales
has revealed that promotion takes place at a late stage in one’s career. The study also
found that the existing promotion policy is one of the major causes of high levels of
dissatisfaction (62%) among the employees.
This mismatch between the aspirations of the employees & organizational needs requires
immediate attention. There is an urgent need to revamp the current promotion policy and
replace it with a much more dynamic one that allows for a fast track growth.
c) Frequent Transfers:-
The frequent transfers are a major cause of discontentment particularly
among officers. This is a serious issue because discontent has a direct impact on
employee performance and thus on the bank’s productivity.
The average transfer cycle is 2.5 years and 3.5 years. In the case of directly recruited
officers and promote officers respectively.
Banks need to formulate proactive & transparent transfers & placement policies that will
allow for a smooth mobility of staff, optimum utilization of HR and achieve cost
effectiveness. However, care should be taken to minimize hardships to employees.
d) Training:-
The way in which a banker performed banking activities no longer exists in many
part of the world. The world is witnessing the emergence of the ‘Techno Banker’.

This is keeping in tune with modern banking gadgets and payment gateways that the
‘Techno savvy Banks’ currently offers.
If PSB employees are to fall in line with peer practice of the industry, then there is an
urgent need to fine tune their skills and assimilate in them the intricacies of the new
functions that are performed.
The focus in banks had shifted towards market orientation, from systems and procedure
orientation. Thanks to the cut - throat competition among banks, the present day
customers of banks are always demanding for better products and better services. Their
demands are continuously increasing and bankers are constantly on the look out for
products that maximize the service quality.
Training programs should aim at enhancing the value addition factor to the customers in
products dispensed and the services rendered. Relationship Management should be the
focus of training programs. It should aim at improving customer’s services in banks. PSB
s needs to start training to their staff in marketing concepts. Service marketing is the area
PSB s need to concentrate in order to win over the customers.
1.6 Overhauling Performance Appraisal & Reward Systems:
A recent study has found that three – fourths of the clerical staff and more than 90% of
the officers felt that the present PA systems should be changed. Further about 75% of the
employees thought that there should be a penalty for non – performance and reward for
superior performance.

The improvement in the PA system is a major challenge that PSB s face. Designing and
implementing an appropriate reward system is an even greater challenge.
1.7 Attracting & Retaining Talented Employee:-

In the face of stiff competition from service industries, private sector and foreign banks
(which offer attractive remuneration & better working conditions) the public sector banks
have a formidable challenge of attracting and retaining young people with multi –
dimensional skills and experience. This is more so in the case of staff members with
some IT backgrounds and related knowledge.
HR departments of banks need to proactively to look into this area & develop suitable
ways for tackling this problem. Perhaps the times ripe now to introduce initiatives such as
employee’s stock options (ESO), quick promotions etc…..
1.8 Cultural Clashes:-

If Indian banks want to arrive on the global map and compete on global level then they
need to develop size. Rather than have a large number of small banks, we need to have a
small number of large banks. Thus the need of the hour is consolidation of PSBs. This
can be done through mergers of various PSBs.
A challenge that HR managers are very likely to encounter during the consolidation
phase is culture clashes. Each PSB has its own unique culture and ways of working and
hence confidence building measures prior and after the merger will be critical to ensure
that these new marriages survive and prosper.

CHAPTER-2
HUMAN RESOURCES PLANNING, RECRUITMENT
&
SELECTION
2.1 Human Resource Planning Of Standard Chartered Bank:-
HR planning is a process, which anticipates and maps out the consequences of business
strategy on an organization’s human resources. This is reflected in planning of skill and

competence needs as well as total headcounts. Every organization needs to be able to

forecast and plan for its future people requirements.
At Standard Chartered Bank, human resource planning involves forecasting the numbers
of people which will needed by the bank, and then working out the best way of obtaining
then as and when they are needed.
2.1.1 Forecasting:
Forecasting is the major function of the bank’s HR department. The forecasting activities
include:
1. Workforce numbers in sufficient detail to be useful.
2. Likely changes to the work of the bank.
3. Work force supply – this involves forecasting the variations in the current
work force estimated to occur over the following years.
4. Impact on budgets and funding.
2.1.2 Who‘s responsible for it?

It’s easy to shift responsibility and say that personnel and human resource
departments should carry out HR planning, but it should be the concern of every
manager. As the Bank operates in a dynamic environment where new and advanced
practices are frequently emerging resulting in changing customer’s requirements.
2.1.3 Good Practice Indicators:

Standard Chartered Bank makes sure that effective human resource planning processes
are in place when

1. Appropriately skilled people are available to be deployed in the Bank’s to

meet forecast work demands.
2. The Bank’s structure provides with opportunity for appropriate career

development, and is perceived to contribute to effective and efficient work
practices.
3. Relevant workforce data is readily available to inform management decision
making on human resource issues.

2.2 Recruitment Of Standard Chartered Bank:-
Human Resource Recruitment is defined as any practice or activity carried on by the

organization with the primary purpose of identifying and attracting potential employees.
The goal of an organizational recruitment program is to ensure that the organization has a
number of reasonably qualified applicants (who would find the job acceptable) to choose
from when a vacancy occurs.
Standard Chartered Bank recruits the most talented individuals from the external market
to supplement our internal pipeline of talent.
Their Human Resources department provides guidance on the use of psychometric tests
and has robust recruitment criteria to ensure that all candidates are treated fairly, equally
and with respect. It has a global Graduate Recruitment Program; where in the region of
150 graduates are recruited each year on a management trainee program across all
businesses, functions and countries.
2.2.1 Who are they recruiting?

1. Bright, young graduate or a postgraduate, who cannot wait to start his/ her
career in the financial services industry.
2. Consistent academic performer throughout his/her education.
3. Career-oriented person
4. Energetic, ambitious, innovative and business-oriented person.

2.2.2 Recruitment Criteria:
Standard Chartered Bank recruits the most talented individuals from the external
market to supplement their internal pipeline of talent. Their Human Resources
department provides guidance on the use of psychometric tests and has robust
recruitment criteria to ensure that all candidates are treated fairly, equally and with
respect. It has a global Graduate Recruitment Program; where in the region of 150
graduates are recruited each year on a management trainee program across all
businesses, functions and countries.
2.3 Selection:-
Any organization that intends to compete through people must take the
utmost care with how it chooses organizational members. Personnel
selection is the process by which companies decide who will or will not be
allowed into their organization. Several generic standards should be met in
any selection process, which are reliability, validity, generalizability, utility,
and legality.
Standard Chartered selects employee based on knowledge, skills and talent.

They are committed to providing equality of opportunity to all employees,
regardless of gender, race, nationality, age, disability, ethnic origin, or
marital status. They are committed not just to providing equality of
opportunity to all employee, but also identifying what unique strengths each

individual brings to the roles they carry out and the development of these
strengths.
2.4 Employee health, well-being and safety:

Standard Chartered Bank believes that the health and well-being of their employees and
their families is important. They are concerned not only about the physical health of their
employees, but also their mental and emotional well-being.
Standard Chartered has policies & practices that provide for a safe and healthy working
environment. They place importance on the safety and well-being of their staff,
communities and on the effect it’s working and operational processes have on the
environment. They are continually developing policies and practices designed to maintain
the highest appropriate standards.

CHAPTER-3
INDUCTION
When a new employee joins the organization, the few first days is one of a
great uncertainty. Even the calmest and most competent employee feels little
nervous, anxious and insecure. This is because he is unfamiliar with the new
surroundings. Hence, most organizations offer some kind of induction program to
help new employees.
3.1 Definition:-
‘Michael Armstrong’ defines induction as “the process of receiving
and welcoming employees when they first join the company and and giving them the
basic information they need to settle dawn quickly and happily & star the work.”
3.2 According to Armstrong induction has five main aims:-

(1) To put the employee at ease.
(2) To create employee interest in the job and organization.
(3) To provide basic information about working conditions.
(4) To indicate the standards of performance and behavior expected

from the employee.

(5) To tell the employee about training arrangements and how he or

she can progress in the company.
3.3 Induction at Canara Bank:-
Canara bank has recognized the importance of induction. Evidence of this can be seen in
the HRD book of the bank. The handbook has a chapter that advises managers on the
objectives of induction and the systems to be followed. Given here below is a
summarized extract from his hand book.
Entry Interview for effective Induction of new Entrant:

Objectives:-
 To ensure introduction of the new entrant to the entrant to the institution, its
culture, tradition, ethos and work ethics.
 To have a formal interaction between the head of the branch and the new
entrant in order to have introduction to the job and colleagues.
 To provide psychologically assurance that he will be looked after and cared

in the new place.
 Help the employee to shed apprehension, if any, and feel free in the
environment.
 To initiate the socialization process of the employee in the organization on a

positive note. So that the process of emotional interaction is fast and smooth.
System:-
 The branch manager/section in charge conducts the entry interview of the
new employee on the first day immediately on his joining the branch/office.
 The interview has to be conducted in a friendly atmosphere and the

employee is made to feel at ease.

 Through the interview the manager elicits the background of the employee-
family and profession, his goals in life, his expectations, his capabilities and
potential.
 The manager finds out the needs of the employee at the new place and helps
him to settle.
 A handbook “Step into the family for an enriching partnership” is given to

the employee.

CHAPTER-4
TRAINING & DEVELOPMENT
4.1 Definition:-
Training is basically the management of learning. The objective of
training and development is to raise the level of performance in one or more aspects. This
is achieved either by providing new knowledge and information relevant to a job or by
teaching new skills or by imbibing an individual with new attitudes, values, motives and
other personality characteristics.
According to Edwin Flippo, training is “the act of increasing the knowledge and skill of
an employee for doing a particular job.”
Goldstein describes the training process as “the systematic acquisition of attitudes,

concepts, knowledge roles, or skills that result in improved performance at work.
Training prepares employees to perform their present job even better and more
efficiently. It also prepares the employees for higher positions with increased
responsibilities.

4.2 Standard Chartered Bank’s Training & Development:-
Development is critical to our future business success. Our bank’s performance will
only continue to improve if we develop our people –you . To develop our people is to
invest in our future. We know you have the motivation to succeed, to be good at your job
and progress as far as you can.
As Standard Chartered, training is a partnership between the employee and the Bank. The
Bank provides a framework within which the employee can identify the training and
development needs. Such training provides a consistent standard of management learning
throughout Standard Chartered. It also enables the employees to take all of the programs
or study for individual modules according to their particular development needs.
4.2.1 The Initial Two Years:

What the employee can expect to experience during initial 2 years training is
a blend of core and discretionary elements, such as:
1. Induction i.e. the processes that introduces the new entrant to the bank, the
employee’s own business or function and particular department.
2. Training in specific products or technical skills.
3. Work-based assignments in respective business or function i.e. doing a job
in a particular department for a period of time.

4. Cross-functional attachments – experiencing short period of time spent in

another business or support function.
Long Term Training:

Development and training does not stop after two years. After this initial training, the
employees are faced with internal development programs, business-related studies and
professional qualifications, and the bank also offers the opportunity to develop skills
through externally accredited courses. These are designed in conjunction with top
universities and business schools including postgraduate, MBA.
Accreditation Internal
External Schools Executive Development
MBA Diploma in Management
Certificate in Management Foundation Course
Induction Course
Orientation:
Every staff member joining Standard Chartered Bank has to attend a 2-day
comprehensive orientation to get a feel about the Bank and its business. This orientation

program provides a good chance to meet with seniors & colleagues and to build up the
team spirit.
Product Training:
Product training is provided e.g. cash product training, operational training etc. to help
the related staff to learn more about the products that the Bank is providing.
Skill Training:
The bank provides a lot of skill related training e.g. credit workshop, sales & negotiation
skills, project management, etc. to help staff enhance their skill in particular aspects.
On-job Training:
Staff members are continuously involved in the learning process in the form of on-job
training. Thus, a lot of on-job training opportunities and job rotation to increase staff’s
exposure are provided.
Self-learning:
The bank sends out CDs and books to staff for them to study on trade knowledge , credit
knowledge, etc. and staff will decide when he/she will attend the Trade Skill
Assessment(TSA) and Credit Skill Assessment (CSA).
Management Development Training:

In this training program, the employees are given strategic perspectives and business
goals management skills; people management , networking and customer focus abilities
to better understand and manage their jobs.

Specific Competency Training:

Specific Competence Training is to ensure that the staff excels in product knowledge,
regulatory and unique techniques needed for the particular position.
4.2.2 Learning and Development:

Standard Chartered recognizes that it is essential that they have the best people equipped
with the right skills and knowledge to perform their roles to the highest standards. They
went talented professionals, who seek self-development opportunities including
continuing professional development. In return the Bank offers excellent training and
development. They focus development on where they believe that they will get the
greatest return, by developing employee’s strengths.
4.3 Training for Managerial Effectiveness in Banks:-

Introduction:-
In today’s banking environment, nothing is more important than customer
satisfaction. There is a metamorphosis in the appearance and functioning of the banks,
which are slowly transforming from the traditional acceptance of deposit for lending
purposes to a financial super-market. The growing needs of the customers make the task
of managing change and innovating new products and services a prime function for a
bank to maintain its position in an increasingly competitive environment. With the
advent of economic reforms, the public sectors Banks, which have been sheltered under
stable Government policy over the past 25 years, are now facing competition.
Thinking in terms of the future and producing the right mix of services to attract all
customers has become one of the prime objectives of a bank. The executive of a bank

today have to imbibe changes into the system, implement them well without delay and at
the same time be able to project a stable outlook. It is in this context that training and
development of managers in a bank becomes vital.
In India, today we have Public Sector Banks, in whom the Government or the Reserve
Bank of India holds controlling interest, Private Sector Banks and Foreign Banks. The
role of foreign banks which have hitherto been limited to metropolitan centre and focused
on high value personal loans and trade finance have undergone a sea-change at present.
The growing World Wide Web has offered them an opportunity to function from remote
locations. The Private Sector Banks that have concentrated their operations in a particular
geographical zone have also grabbed this opportunity to increase the number of
customers.
The public sector banks which have for more than 2 decades been the providers of
banking services at remote locations across the length and breadth of the country and who
had the solace of Governmental support for their acts are today faced with increased
pressure from all avenues for improving services and organizational efficiency. Though
it is true that public sector banks are overstaffed and return on capital deployed is poor, it
should be viewed from a perspective, which incorporates the effect of Government policy
and directives of the past years. The task of managing change and proving effective is
more challenging for the executives and managers of public sector banks today than that
of other banks. This article focuses on training for effectiveness of this class of
managers.

4.4 The Scenario
With rapid globalization of products and services, economic thinking is

primarily market driven with transparent regulatory authorities, than dictated by the
Government. The market opportunities are by definition limitless provided one invests in
the right type of people and product development. The risk of failure today, however
appears to be much higher than that would have been the case a few decades ago.
Though a perspective plan and a long-range plan are not new terminology in a bank and
most of the managers and executives are involved in the process, nothing much had been
done to improve organizational development to meet future goals. As a rule most of the
managers react to events as and when they arise than to foresee and plan courses of
action.
There is a training system in place in most of the banks and the training
centers are mostly involved in imparting procedural inputs rather than developing an
individual as a whole to emerge well in changing environments and unforeseen
circumstances. In a Bank, where most of the instructions are documented and a defined
set of rules are provided for almost all types of transactions, the ability of the individual
to think beyond, and at the same time not compromise on the security features assumes
enormous importance in an ever-changing atmosphere.

Before embarking into any suggestion for executive development in Banks the following
points have to be taken into account:-
(i) The traditional idea of management in Indian banks, which believes that rigid
Organizational structure, express delegation of authority and an unpardonable attitude
towards errors have to a great extent hampered the growth of organizational
effectiveness. Seniority and age are pre-dominant factors in determining the place of a
person in the hierarchy.
(ii) Rapid advancement in technology and increased use of computers and IT in banking
operations have to be technology savvy to understand and implement IT products to
meet the ever-growing needs of customers.
(iii) Liberalization of economic policies and decreased support from the Government has
to be taken into account. The norms for asset classification and increased provisioning
requirements, increased capital adequacy norms and changing statutory requirements
should be borne in mind.
(iv) Progressive dis-intermediation of banking services with more customers investing

directly and through mutual funds have driven banks to rely more on fee-based income
rather than fund-based income. It is pertinent to remember that despite this thinking fund-
based income is the major provider to banks’ income today.
(v) Increased use of cheques and cards and increased disuse of currency transactions
would require banks to reorient services. The frontline of the bank which is typically an
array of clerical and cash counters will witness a change in the coming years.

(vi) Strength of network and size of capital and working funds dictates the policy and
approach of the bank. Today’s PSB s have fairly large number of branches distributed
over a vast area and have huge working funds mobilized from the public.
4.5 The training needs in banks:-
The points mentioned suggest that there is an immediate need for
1) Empowerment of staff:-
Empowerment is simply to delegate the authority to make decisions
that belonged to superior officers. There is no escape from the simple truth that “the
strength of any organization lies in its human resources and they have to be used
effectively”. It should also be noted that today 65 – 70% of the overheads of any PSB
relates to employees’ salaries and benefits.
The most effective way to motivate employees is to encourage them to get results. Given
sufficient freedom most will perform. Depending on the outcome employees may be
encouraged to pursue further tasks with more delegation. Loyalty to the organization is a
much expected quality in a manager by his subordinates and it would be in the interest of
any organization to develop a deep sense of loyalty o the organization in its managers.

Encouraging new and innovative ideas are a way to bring out the participation of the
employees. Employees should be given adequate freedom to experiment.
A good job done should be recognized and rewarded. Reasons for poor performance of a
team should be analyzed and corrective steps should be taken.
2) Upgrading managerial competence:-

Managers are very often leaders who are looked upon by banks to achieve its goals.
Therefore upgrading managerial competence is of prime importance. As managers
develop into quality motivators empowering their subordinates to perform them also
automatically increase their competence to be managers in the future.
In this context it is important to note that the development of a handful of personnel
endowed with skill into superior class will not help the organization in the long run.
Upgrading of the middle group which constitutes more than 50% of the working people,
should be aimed at to ensure stability and growth.
3) Understanding employee needs:-

One does not perform to full capacity until and unless all his needs are met. Management
thinker has recognized the relationships of need fulfillment to motivation and
performance of employees. Recognizing employee needs and fulfilling them should be
the function of the manager.

4) Continues up gradation of knowledge and skills:-

Banks today maintain the accounts of the customer, provide the broking and custodian
services, provide investment counseling and round the clock banking facilities. Today
banks have embarked into leasing, hire purchase, insurance and many other areas, which
were not even dreamt of in the past. Continues up gradation of managers is necessary to
meet the challenges. The manager is also responsible for training his subordinates and
that makes the task all the more difficult.

CHAPTER – 5
PERFORMANCE MANAGEMEN
5.1 Performance Management Of Standard Chartered Bank:-

Traditionally, the formal performance appraisal system has been viewed as the
primary means for managing employee performance. Performance appraisal is an
administrative duty performed by managers and primarily the responsibility of the
HR function. Performance management is the process through which managers
ensure that employee activities and outputs are congruent with the organization’s
goals. It is central to gaining competitive advantage.
5.1.1 Components of Performance Appraisal:-

At Standard Chartered Bank the components of performance appraisal are in
respect of the five W’s that include: Who, What, Why, When and Where of
performance appraisal.
Who: All employees work under the supervision of managers. Therefore,

the manager is the best person to do performance appraisal of his
subordinates.

What: The appraisal at the organization includes appraisal of current

performance as well as the future potential. It also includes evaluation of
human traits such as behaviors, interaction with other staff members etc.
Why: It is concerned with creating and maintaining a satisfactory level of

performance of employee in the present job, highlighting his needs and
potential for personal growth.
When: It is carried out on yearly basis. The manager uses good work as
opportunity to provide positive thrust and uses poor work as a basis for
training.
Where: The performance appraisal is done in a cordial and friendly
environment.
5.1.2 Approach of Measuring Performance:

The performance of the employees can be determined by making an overall
comparison among individual‘s performance. Hence a performance
measurement system is developed that incorporates a tool for measuring
performance.
5.2 Appraising Employee Performance:
5.2.1 Individual Performance Management:

A longstanding question that Standard Chartered Bank and many other
organization are still grappling with is whether and how to reward good
performance (or, conversely , how to deal with persistent poor performers).

One approach used by the bank is to make salary increments or progression

on the pay scale conditional on good performance.
5.2.2 Performance Management at Senior Levels:
Typically, performance management systems for senior officials include elements

additional to performance-pay, such as time-limited contractual appointments.
The Bank has adopted this approach. Key features of its system include the following:
1. Senior officials are recruited to a unified career structure known as Grade A,

which incorporates most top-level positions.
2. On the basis of evaluation, the senior position employees are paid a
performance bonus.
5.2.3 Linking Performance to Promotions:

Some have argued tying career advancement to performance is more
important than linking performance and pay. Whereas the benefits of pay for
performance are uncertain, particularly in the lower echelons, there is no
doubt of the need to ensure that the best people rise to management levels.

CHAPTER-6
TRANSFER & PROMOTIONS
6.1 Transfers:-
Reshuffle of human resources is essential for the smooth and efficient
management of the organization. It also serves the broader interests of the organization.
Hence such reshuffles popularly known as job transfers have become very common in
modern business organizations.
6.2 Definitions:-
Yoder and associates have defined job transfer as “a lateral shift causing
movement of individuals from one position to another usually without involving any
marked change in duties responsibilities, skills, needed or compensation.”
A transfer thus involves a change in the job (accompanied by a change in the place of
the job) of the employee without a change in responsibility or remuneration.
Transfers may be initiated either by the company or the employee. A company

may initiate transfer to place employees in positions where they are likely to be more
effective. Similarly, employees may initiate transfers to locations where they are likely to
get greater satisfaction.

6.3 Transfer policy:-

Every organization should have a just and impartial policy concerning
the transfers of employees. It is important that every employee knows the policy.
6.3.1 A good transfer policy should satisfy the following conditions:-
(1) It should state the types of transfers (departmental or interdepartmental) and the
circumstances under which transfers will be made.
(2) The person/s that have the authority to order transfers. Usually transfers in each
department are handled by the person in charge of that department. The HR dept.
usually, has a big say in transfers.
(3) The effect of transfer on pay and seniority should be clearly mentioned.
(4) The facilities available to transferred employee should be clearly mentioned.
(5) The transfer policy should state the conditions under which personal requests of
the employees for transfer will be entertained.
(6) All transfers decisions should be communicated to the employee in writing.

6.3.2 Transfers in banks:-

In the public sector (PSBs, the transfer of officers in
the junior management and senior management grades are governed by government
regulations. The exact nature of these regulations may vary from one PSB to another but
it has to within the broad framework of government guidelines.
6.4 The main objectives of transfers in PSB’s are:-
 To enrich the work experience of officers. Transfers will expose officers to

different work environment as well as different facets of the banks business.
 The officers service regulations (OSR) makes it mandatory for an officers to serve
for two years in a rural branch and three years in a semi urban branch to eligible
for promotions.
 Transfers help the bank to meet administrative requirement of filling vacancies and
effecting postings on promotion.
The following is a brief summary of some of the rules and regulations that govern the
transfers of officers in one of India’s leading public sector banks:
(1) Every officer is liable for transfer to any office or branch of the bank
or to any place in India.

(2) In case of administrative exigencies the bank has the right to affect
any transfers whether or not in conformity with transfer guidelines.
(3) Transfers may take at the regional, zonal or inter-regional level.
(4) The exact nature of what constitute a region or zone may vary from
one PSB to another PSB and is decided by the bank on based on its business
policies and strategies.
(5) Inter region transfers are usually decided by the central office.
(6) Transfers within administrative regions are usually decided by the

regional heads.
(7) The normal tenure /term of an officer are 3 to 5 years. However for
specialized officers this would be 5 years.
(8) No officer is to be transferred before the completion of normal term

of at least 3 years.
(9) An extension beyond 5 years is considered only in exceptional cases.

Even in such cases the maximum extension is of 1 year.
(10) For transferring an officer before completion of the minimum terms,

reasons should be recorded and informed to the central office.

(11) Request transfers on the grounds of extreme hardship would be

considered on the merits of each case. The final decision is dependent on the
transfer history, reason for request and performance of the officer at the
place of posting.
(12) Representation, if any should be submitted within one week of

receipts of the order. The representations are examined by a committee at the
central office and a decision is made. The decision of the committee is a
final and further correspondence on the matter is entertained.
6.5 While executing transfers, the concerned authorities have to

ensure that:-
(1) The transfers have been affected as per guidelines/directives received from the
central office.
(2) There is uniformity in application of norms.
(3) Mismatch of grade scale is avoided.
(4) Sensitive posts like that of branch managers, lead bank officers are not kept vacant.
(5) Completion of rural and semi urban service norms.

(6) Officers who have completed 55 years of age or more are posted at places of
minimum inconvenience. However the final decision would depend on:
 organizational needs
 Suitability of the officers for the post in question.
 The transfers history and past performance of the officers.
(1) Lady Officers are given opportunity to intimate 3 choices places within the
transfer region/ transfer zone applicable and their postings would be
finalized taking into consideration the preferences intimated.
(2) Physically handicapped officers are transferred to places of minimum

inconvenience. The final decision is made in consultation with a medical
practitioner and chief liaison officer for physically handicapped employees.
PROMOTIONS
Promotion refers to advancement of an employee to a higher post carrying greater

responsibilities, higher status and better salary. Promotion puts an employee or executive
on a career path which goes upward. On being promoted the duties and responsibilities
increase.

6.6 Definitions:-
According to Scott and Clothier a promotion “is a transfer of an
employee to a job which pays more money or one that carries some preferred status.”
In the opinion of Wendell French “a promotion is a type of transfer involving the

reassignment of an employee to a position that is likely to offer higher pay and greater
responsibilities, privileges, and potential responsibilities.”
Generally when an employee is assigned to higher level job with more money pay and
powers he is said to be promoted.
6.7 Promotional policies in Bank of India:-
The policies of banks with regard to promotions vary depending upon the scale or level
at which the officer is given here below are the promotional policies for officers at the
junior management (JM) and middle management (MM) grades.
The information given here has extracted from the “Bank of India officers associations
diary (BOIAD), 2006.”
6.8 Some of the other terms and conditions regarding promotion

(according to BOI Association Diary 2006) are:-
1) Rural service marks will be for rural service in excess of 2 years -5marks per years.
Service in excess of 6 months but less than 2 years -2 marks.

2) Specialist officers to undergo rural service as and when he switches over to

mainstream.
3) In the fast track channel, an officer who has not completed the minimum 2 years of
service in rural branch will be considered eligible for promotion –subject to
proviso that he shall complete 2 years of service at rural branch after his promotion
to scale II.
4) Professional qualification marks are given for CAIIB, charted accountant,

company secretary, cost & works accountant and CFA (5marks).
5) Officers will not be eligible, if the average marks in APR for preceding 3 years are
below 40%.
6) Debarment – non acceptance of promotions for the first time next process, for
second time – next two processes and for third time-permanently debarred.

ARTICLE
ICICI Bank plays a smart trick – No promotion & No

bonus but no attrition too!!
Article Written By Amit Khandelia:-
Have you ever seen the Chief of Human Resource coming out and crying loud on
no promotion, no bonus, no increment, and no hiring policy of a company? ICICI
bank is an exception and is doing this smartly. This policy is serving two purposes
for ICICI bank, cutting down employee cost and employee retention. Well! The
first one, that is cutting down employee cost through no increment is self
explanatory and does not needs any elaboration. As the company has already
announced no bonus year it will save tens of thousands of rupees on bonus and
increment. You must be still thinking about the second purpose which is ‘employee
retention’. Interestingly, I have my own views and I feel that this policy will help
the bank to retain employee as I see the policy from the eyes of HR and not
through the eyes of employees. Let’s see the arithmetic behind it.
Generally, companies tweak their HR policies either to retain employees by luring

them through ESOPs, retention schemes and employee friendly policies. On the
other hand, when they have to cut down on their employee force, it is again these
policies which come to their rescue. No company asks their employee to leave
straightforward as it is quite unethical on the part of the company to do so.
Indirectly, they cut down on bonus, promotions and other amenities which send a
wrong signal to the employees and they start churning out. Very often these

policies are confidential and not meant for public consumption as it sends a wrong
impression about the organization in the public domain. ICICI bank did this very
smartly; the HR chief is holding press conferences and crying out loud regarding
no bonus and no promotion. No idea, what is cooking in the minds of chiefs sitting
at the top and how is it going to impact the employees??? I will share a real
experience with you.
The day ICICI announces this policy, one of its employee tries his luck at some
other company. As soon as the big question comes from the interviewer regarding
salary hike, he replies that he is expecting a hike of 30%. Guess what the reply of
interviewer is? “Even after today’s announcement by your organization you are
expecting a hike of 30%. Sorry to say but we cannot offer a hike more than 10%.” I
hope this explains the trick played by the bank.
Seeing the losses incurred at this hour due to subprime bug, the bank has
accordingly managed to cut down it cost. More than this, it is an appreciating fact
that, it will also be able to control the attrition rate as the policy is made public and
other competitors would not be willing to offer a smart hike to candidates who are
looking for an opportunity outside the organization. In such a scenario, employees
of the bank are left with the only option to remain where they are and enjoy the no
promotion and no bonus year.

HRM DOCUMENTS OF BANK OF BARODA
HR Mission

HR Objectives
 To initiate & institutionalise globally competitive HR practices in the Bank

in our pursuit to become a Bank of international standards and to become an
employer of preferred choice;
 To put in place relevant HRD strategies and use modern methodologies to
undertake organizational renewal; identify and nurture talent, bring about
marked changes in the mindset of employees at all levels so as to enhance
HR Quality;
 To create a performance-driven culture and an exciting workplace for the
employees
 To create a pool of entrepreneurial managers and business leaders for future;
 To inculcate a strong and effective sales and service culture across levels in
the organization in order to generate strong stakeholder affiliation;
 To create a learning organization for employees’ intellectual growth and
creativity; and to re-skill the workforce to operate in digitally enabled

modern core banking environment.

HRM BUSINESS MODEL
The Strategic HR Business Model adopted by Bank of Baroda incorporates its

HR Mission and Philosophy and is focused towards attainment of long-term
organizational goals.

A very strong Organizational Leadership at different levels forms the key link in
the Model. These are;
 Strategic Leadership - Corporate level
 Business Leadership - Zonal & Regional level
 Operational Leadership - Business unit level i.e. branch
The two vital Human Resource sub-systems i.e. HR Planning & Management Sub-
System & Competency Based HRD Sub-System shape the very crucial
Performance Environment within the Bank which facilitates development of
enabling capabilities of people.
Through proper developmental inputs, Positive Attitude & Right Mindset is

created among people.
Through proper Communication Medium and an Organizational Culture of

sharing, openness, collaboration & confrontation, autonomy etc., people in the
organization are facilitated to give their best output (performance).
The Model is adequately supported by a suitable Learning Platform, which

imparts proper Knowledge and enhances Learning among people (functional,
behavioural etc) so that their Competence increases and their potential could be
properly leveraged for greater Individual and Organizational Effectiveness.
These create proper Employee Motivation, which ultimately facilitates Goal

Achievement.

HR Initiatives
» HR Blueprint for Business Driven HR Reforms
Board level approved strategy paper outlining various organization wide HR

reforms /interventions
» HR Steering Committee
Board Level HR Committee for piloting HR initiatives and reforms. The
Committee comprises of Directors and leading professionals as Experts from
outside the Bank.
» KHOJ
Organization wide Talent identification and Development Programme for
Officers and Clerks
(Through scientific process of identification and selection, employees with
high potential to be deployed in key business areas. Such employees to be
provided with suitable grooming and career growth opportunities)
» SAMPARK
SOS Employee HELP Line
(Employees in distress can directly approach the CMD for immediate relief)
» PARAMARSH
Employees Counseling Centre
(Counseling centers for providing psychological assistance and guidance to
overcome their stress, complexities and conflicts in order to lead a better life.
This is totally confidential between the employee and the counselor.
First such center set up at Mumbai where services of professional Clinical

Psychologist are available.

» BARODA FINANCIAL REWARDS FOR BUSINESS LEADERS

Weighted Index based Model (with pre-defined weight ages for different
business KRAs) for balanced assessment of efforts of Business Leaders
(Branch Heads, Regional Heads, Deputy Regional Heads and Zonal Heads).
Rewards in Cash for achievement of business KRAs
» MEP-TIKSHNA
Management Education Programme for Executives (GM, DGM, AGM, Chief

Managers) in association with top B-Schools like IIM-Ahemedabad and
Management Development Institute, Gurgaon. The specially designed
programme is aimed at development of strategic business leaders for the
future. So far, 213 executives have undergone the programme.
» HR POLICY FOR OVERSEAS SELECTION & DEPLOYMENT

Scientific and process orientation in the new revamped policy for selection
and deployment of officers at the Bank’s overseas territories.
» HR RESOURCING POLICY
New HR Resourcing Policy formulate to take care of various recruitment

needs of the bank consequent upon abolition of the erstwhile Banking
Services Recruitment Board (BSRB)
» Performance Appraisal System for Clerical and Sub-Staff

With the objective of bringing an organization wide performance culture in the
organization, hitherto uncovered employees in the Clerical and Sub-Staff cadre
brought in under a new performance appraisal system.

» Massive Recruitment of Specialist officers and also graduates from B-

Schools through campus recruitment
To take care of the Bank’s requirement in different specialized areas like IT,
Treasury, HR, Marketing & Sales, Credit, International Business etc (Around
500 officers being recruited).
» A New Induction cum Grooming Programme for Young Officers
With the objective of developing future managers and leaders and for
deployment in key areas, a re-vamped Officers’ Induction cum Grooming
Programme is launched.
» Fast Track Career Growth Opportunities for Executives and Officers\
In order to provide fast track growth opportunities to aspiring Executives and

Officers, promotional opportunities have been provided.
» BARODA LEADERSHIP DEVELOPMENT CENTRE
Board has taken the decision to set-up a World-Class Leadership Development

Centre to be set up to prepare future leaders for the Bank.
» NEW GROUP HR STRUCTURE

A new Group HR Organization Structure is being put in place to take care of the
strategic business – HR needs of the Organization. The Structure would have
balanced focus on HRM and HRD aspects and will put in place competency based
HR systems and practices.

SURVEY OF HUMAN RESOURCE PRACTICES IN STATE BANK OF INDIA
The State Bank of India is the premier bank Central Bank with wide network
of several branches, it has been chosen as a sample organization for the study. In a
research survey is conducted to elicit information about general climate, human resources
mechanisms and attitudes of the employees of the selected bank. This research is an
attempt to review the Human Resources practices in the Indian Banking sector taking
place in the aftermath period of the new private banks and foreign banks through the
process of liberalization.
The survey is conducted to investigate whether the Human Resources is

practices in State Bank of India are in the line with the contemporary developments in the
Indian Banking Sector. The basic activities of human resources viz., job rotation,
training, performance appraisal, rewards, career planning and development, feedback and
counseling, potential development, human resources information systems, organization
development, etc.
It is found that the employees of State Bank of India are very sincere and
committed. It is observed during the time of survey that in several branches of the bank,
often, they are required to remain in their offices even after the closure of the business
hours. This situation further implies that the working hands in case of officers level is
inadequate, and also not in proportion to the workload assigned to them. Consequently,
they are overburdened, and this condition led the the frustration of this group of
employees in the banks. Obviously, this tendency communicates that an atmosphere of
exploitation of human resources is prevailing in the bank.

It is further observed that the employees who are not allowed to go on VRS are greatly
dissatisfied towards the management attitude. They felt that the action of the management
with regard to VRS is self – seeking. In addition, they believed that lot of work has been
imposed on their shoulders in the aftermath period of VRS in the bank. The prevailing
circumstance consequent to the implementation of VRS is very rigid. Thus, the
employees of the bank have bee overloaded due to the excessive work and the bank
branches looked like manufacturing units.
The survey also identified that the off – the – job training is not a continuous
process in the bank, which speaks that the training function is irregular. It is also reported
that the assessment of training need is also done irregularly in the bank and hence the
evaluation of training need is not a continuous process in the bank. Further, it is also
found that most of the learning in the bank is facilitated when the tasks are performed and
the employees familiarize most of the work procedures dring their on-the-job training. On
the other hand, it is well known that the job rotation is a regular phenomenon in the bank.
It is observed that employees are frequently subjected to internal transfers within the
same branches and thus they are exposed to multifarious functions existing in the bank.
This helps employees to acquirs knowledge and skills and therefore, job rotation is
facilitating employee’s development in the selected bank.

The majority of the respondents revealed that they are fully aware of the
work rules and procedures of the bank. This implies that the employees in the bank
strictly comply with the code of conduct framed by the management and thus if forms the
basis for union management relationship. In this context, a large group of respondents
opined that they are greatly satisfied with their affiliation to the bank and with their
present job. The data further revealed that the senior management cadre is highly satisfied
with the training and development system. Among the three cadres of employees in the
bank, the senior cadre is very well pleased with respect to the HRD system.
However, it could be disclosed that the other two cadres of employees have
shown a minute dissatisfaction towards the training and development system. Further, it
is observed that the junior management cadre is highly favorable to the system of
'recognition and reward’. It is also unveiled that all the three cadres of employees are
comfortable with the existing 'security' system. Every respondent felt that he is highly
secured with respect to his employment. The majority of the respondents from the two
cadres' viz., clerical cadre and junior management cadre are optimistic with respect to
relationships in the bank. Very few respondents from the senior management group
opposed this view. This indicates that there is a microscopic gap existed between the
senior management and the other two cadres of employees as far as the working
relationships are concerned.
The survey also identified that an average OCTAPAC culture is observed in

the bank. It is found from the study that the managers in the bank are not keen in
supporting their subordinates’ development continuously. The survey further revealed

that the managers are providing mere support to their subordinates to accomplish the
tasks of the latter.
Through the analysis of the data it is noticed that the top management efforts
with regard to the identification and utilization of the potential of the employees is simply
at the middle of the road in the general climate. It is also It is further brought to light that
'employee development' in the bank is quite inferior to the other elements found from the
analysis that majority of the respondents have a high degree of response in favour of the
overall HRD climate in the bank. More specifically, it is the junior management cadre
which exhibited hi h degree of satisfaction about the overall HRD climate. This category
is the more satisfied one among the three groups of the employees in the bank. On the
other hand, very few interviewees have unfavorably responded. To sum up, it is clear that
extraordinary climate responses are not seen with respect to any dimension in the bank,
which indicates that the bank has an average climate with regard to Human Resource
Development
Suggestions
The following measures are suggested by the researcher for an effective functioning of
the human resources practices in the selected bank
The perception of junior management and clerical cadre employees of the bank on
the dimension ‘training and development’ is at low degree. Therefore, the management
has provided equal training opportunities to all the employees depending upon the need.

The bank management has to take care of the employees who are unfavorable to the
overall HRD climate. In this direction the management is required to carry out surveys
from time to time within bank in order to comprehend the percentage of people who are
against the climate and the drawbacks of the system. This kind of survey help the
management to know the degree of HRD climate frequently.
The employees irrespective of their cadres should be equally treated with

respect to the dimension ‘recognition and reward’. The bank managers should not be
partial in determining the good performers. Recognition should be dispassionate and
rewards stand by contribution. In this context, the management of the bank should devise
the ways to recognize the virtuous performers by rewarding the employees as and when
they innovate. This move can motivate the employees for higher achievements. Further,
the authorities of the bank should give access to improve the OCTAPAC culture
vigorously in the bank. This would further help employees build enthusiasm and liberty
at the work place.
In case of VRS, through its sensitive issue, it is the responsibility of the

management to disclose the reasons why an employee has not sanctioned the VRS. This
would eliminate certain gaps between the management and the employees. The
employees who are not permitted VRS should place in such setting that they would be
optimistic even at the stage of increased burdens.

Further, the management of the banks has to initiate measures to improve off-
the-job-training facilities. As the workload is increasing day by day the management
should prefer to conduct meditation classes in order to ease the employees from stress
and strain which arise out of imbalances in the assignment. Also, Meditation classes help
employees enhance their psychological attitudes. Certainly, this aspect of guiding
employees spiritually would impart dual advantage, serving the purposes of both the
parties.
Finally, the bank has to reveal the statistics pertaining to the human resources
activities carried with regard to its employees and the resulting progression through huge
displays at the respective branches. This would help the customer of the bank sustain
faith about the future prospects of their bank.

Conclusion
According to my studies the HRM is very important. It also should be given the same
importance how it is given to marketing and financing, budgeting etc…. The HRM is
many a times neglected by organizations, companies and banks. It can result into a loss
for a bank. There are so many new and modern methods to train the employees & to
retain them. By studying HRM you get the knowledge about labor that how to treat them,
what steps can be taken for the improvement in them, how the optimum result can be
obtained from the employees etc…So according to me HRM is very important factor
which should not be neglected by the firms, organizations and banks to achieve the goals
and objectives.
By studying HRM you can get the various methods of encouraging, motivating the
employees. Through transfers and promotions employer can encourage his employees. If
any employee is promoted then he feels proud and does more and more hard work for
more and better opportunities.

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Human Resources Practices in Banks TY BBI SEM - V

1.2 Meaning of “Human Resource” in Banks:-

KES SHROFF COLLEGE OF ARTS & COMMERCE Page 1

KES SHROFF COLLEGE OF ARTS & COMMERCE Page 2

Human resources management is based on four fundamental principles:

KES SHROFF COLLEGE OF ARTS & COMMERCE Page 3

1.4 Need of HRM in banks:-

(ii)The continued growth and development of business, coupled with

Similarly, the need of HRD is more in service oriented institutions like

KES SHROFF COLLEGE OF ARTS & COMMERCE Page 4

KES SHROFF COLLEGE OF ARTS & COMMERCE Page 5

 Creaing a climate of openness and trust;

KES SHROFF COLLEGE OF ARTS & COMMERCE Page 6

1.3 Human Resources Management Functions In Banks:-

(1) Human resources planning: -

Staffing activities include attracting qualified people to the organization,

KES SHROFF COLLEGE OF ARTS & COMMERCE Page 7

(3) Training and development: -

This activity of HRM focuses on improving the

Human resources managers must decide which skills need development

(4) Performance Appraisal and Review: -

(5) Compensation and Reward: -

KES SHROFF COLLEGE OF ARTS & COMMERCE Page 8

(6) Employee participation: -

(7) Organization improvement: -

1.4 Role: Human Resources Management In Banks:-

Human Resources Management is concerned with people, performance,

KES SHROFF COLLEGE OF ARTS & COMMERCE Page 9

organization which is both competitive and compassionate. Wherever HR develops

However, as banking is fundamentally a matter of bank customer relationship, it is

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1.5 HRM Challenges for Indian banks:-

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A major problem in many PSBs is that many posts in them have

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b) Snail Paced Promotions:-

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1.6 Overhauling Performance Appraisal & Reward Systems:

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1.7 Attracting & Retaining Talented Employee:-

1.8 Cultural Clashes:-

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HUMAN RESOURCES PLANNING, RECRUITMENT

2.1 Human Resource Planning Of Standard Chartered Bank:-

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competence needs as well as total headcounts. Every organization needs to be able to

2.1.2 Who‘s responsible for it?

2.1.3 Good Practice Indicators:

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1. Appropriately skilled people are available to be deployed in the Bank’s to

2. The Bank’s structure provides with opportunity for appropriate career

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2.2 Recruitment Of Standard Chartered Bank:-

Human Resource Recruitment is defined as any practice or activity carried on by the

2.2.1 Who are they recruiting?

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2.2.2 Recruitment Criteria:

Standard Chartered selects employee based on knowledge, skills and talent.

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2.4 Employee health, well-being and safety:

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3.2 According to Armstrong induction has five main aims:-