Evaluating an International Human Resource Strategy Banking Industry Flashcard
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This assignment is based on the International human resource strategy in the banking industry and it is mainly covers the areas such as recruitment and selection, Training and development, rewards and performance management, employee participation and trade unions. Through the assignment is it is discussing how the international business environment is influencing HRM strategies, main theories of HRM, effectiveness of HRM strategies, difference approaches of HRM, the relationship between the HRM and organisational performance, implementation of HRM and etc.
According to Rossett and Sheldon (2001) any company knows that HR is the main function which is control the productivity and gain competitive in the market. Hiring the right candidate for the available vacancy is not an easy task. This has to done by the HRM and when the right person selects then after the company is able to increase their productivity and performance. The candidate should match with the company culture and the same time it is important to train and develop them with knowledge, skills and attitudes. The company is responsible about the employee’s motivation level and they can use a reward system to motivate staff members. In bank industry most of the organisations have special reward systems which apply individual as well as team wise to the employees. Employees’ performance is the main component of giving rewards. HR is a value adding tasks which is important in any industry. HR functions can evaluate by using several measurements.
HRM is important to achieve the company goals and direct employees towards goals. HRM department is support of the development of management skills, attitudes as well as employee training and development, employee relations, performance management and development, career development and etc. Companies required making a profit from the employees and they want them to perform maximum. Well designed company goals highly content with the HR practices. According to Testa (2008) HR is important to develop public relations and banks are usually dealing with customers. Therefore HRM is an important function in the banking sector to increase the number of customers. When there is a proper HRM system then there is customer satisfaction as well. When it has considered the current situation after recruit employees it is difficult to keep with the organisation for long term basis since there is competition in the job market and employees prefer to select the best opportunity they offer. As well as it is a challenge to select the best person to the organisation. Management is also responsible able to company HRM and in the banking sector it is important to have proper recruitment and selection process to select the right person to the job. The retaining employees, job engagement, job involvement is also coming under the HRM and when the HRM is strong and work effectively there is work commitment as well. In the UK the main international banks are HSBC, Royal Scotland bank, Lloydstsb TBS, Barclays, Coutts, Co-operative back, ABN AMRO, Citi bank and etc.
Recruitment and selection
According to the Thornton (2008) Recruitment and select is the main function of organisation HRM. Recruitment and selection are two different processes which are interconnected. Recruitment is included advertising the vacancy, short listing candidates, interviewing candidates and etc. This process can identify from the below figure 01. According to the process first company should analysis the positions and requirements. This is can do by using several methods such as from the performance appraisal and company performance will be useful to identify the requirements. Other than that if there are more customers than company should have enough employees to serve them. In banking sector it is important to have branch managers, assistant managers, accountants, cashiers, banking assistants, bookkeepers, computer operators and etc. Therefore the company should identify the available vacancies as well as the available number of vacancies as well, after identifying the vacancies then company can advertise the vacancy by using company websites, newspapers, magazines, online or etc. If there is good market then companies will get more applications. Other than that if the organisation is famous and reputed one in the industry then also they will get more applications. According to the job market it is able to get applications and HRM is responsible to short list the candidates. If there are more applications there then the company can short list them by using their experience, educational qualifications, skills and etc. After that company can decide about the next interviewing stage. That means HRM has to decide how many interviews and what type of interviewing methods they suppose to use on interviewing candidates. Most of the times there are three interviewing stages. But in banking sector there are around three to five interviewing stages. Interviewing methods like telephone interviews, exams, face to face interviews, and group interviews can use to select the candidate.
Companies are able to do the recruiting internally as well as externally. There are advantages and disadvantages in both ways. If it is top management post then it is better to recruit from outside since the employees will motivate when they get new face of the organisation. If it is a lower level position or the middle level position the company is able to recruit internally since they know about the organisation and the inside procedure very well. But by recruiting externally they are able to find new blood it is important to get person with the new thinking pattern to make innovations and changes in the organisation. If the company selects the right person then the other employees will be motivated because of the new candidates. End of the recruitment process it is conducting the interview and take decision on a candidate. Internal recruitment can do by using transfers, promotions or re- emplacement. According to the Koster (2002) External recruitment can do by using advertising, employment exchanges, employment agencies, educational institutes, recommendations and etc.
Purpose of recruitment is to encourage candidates to apply to the vacancy, decide present and future needs, to create talent pool, to develop a connection between employer and employee, select candidate within minimum cost, increase the individual’s effectiveness and etc.
Figure 01- Recruitment process
There are several factors which are affecting recruitment and it can divide as internal and external factors. Those factors can mention from the below figure 02.
FACTORS AFFECTING RECRUITMENT
Figure 02- factors affecting recruitment
According to the Koster (2002) through the recruitment process it is development contact between employer and the employee. In the selection process it is selecting the best person to the organisation. The objective of the selection process is to reject unsuitable candidates and for the recruitment process it is push candidates to apply more. According to the Jackson and Mathis (2007) Selection process is not simple like recruitment and it is complicated since that is the main process of selecting the best candidate for the organisation. The company does selection by following the recruitment process. It is expensive method which requires more time on selection.
Training and development
Training starts after the orientation program and it is important to develop the employee’s skills, knowledge, attitudes, capabilities and etc. There are several benefits of training and development programs such as to increase the productivity level, to increase performance, to improve morale of employees and etc. There are different methods of training such as on the job training and off the job training. On the job training is a cost effective method which can use in any organisation. Especially in banking sector they use on the job training to give overall training about the each function of banking activities. Off the job training includes seminars, conference, workshops and etc. These methods are useful when there are a large number of candidates to train. There are common topics which should cover from the training such as communication skills, diversity, human relations, safety, customer service, ethics and behaviors and etc.
According to Richard (2009) training and development programs increase the job satisfaction and the morals of the employees. It is important to motivate employees towards work and it is increasing the efficiency of the employees. Other than that it is useful to reduce the turnover of the organisation. It is support to change the employee’s ethical behaviors and this is important to develop the company image among them.
There is a traditional and modern approach of training and development. Traditional view is believed that training and development is not worth and cost effective. But in modern approach it is believed that it is important for company productivity and performance. Training programs should develop according to the company goals. If the company is hiring quality employees then it is important to keep them with the organisation. Therefore training and development programs are important to increase their productivity. Sometimes companies think training is only for new employees but it is wrong idea about it has to continue with the job. There can be role changes or job modifications and therefore employees should have proper training continued. In the training process there are few steps such as need assessment, select the trainees, select the proper training methods, identify the gaps, administer the training, evaluate the training and etc.
According to Richard (2009) Training needs can identify by analyzing the organisation as an entire, the individual’s needs and job characteristics. According to the need analysis it will find where is training need, who need the training and why it is needed for them.
Figure 03- the training cycle
The following diagram is mention sample training program structure.
Figure 04- training and development program process
Reward and performance management
The rewards system is linked with the performance management since to motivate employees it is important to have a reward system with the organisation. Any organisation is offering rewards based on the employees’ performance.
According to the Wright et al. (2003) there are different types of rewards and it is mainly can divide into two groups such as monetary rewards and non monetary rewards. Monetary rewards are included bones, commission, incentives and etc. Non monetary rewards included. This system can use in a different manner according to the organisation and its culture. At the same time there are advantages as well as disadvantages of the rewards. Each and every person is working to earn an income and there are other needs of the employees. When the employees are highly productive then they prefer to have more benefits. At the same time when the when the employees are qualified person then they refer to have some rewards for their performance. Pay is a main character of the occupation and HRM is responsible about the reward system they apply to the employees. Always reward system should interconnect with the performance management. There are two methods of payments such as fixed payments like salary and wages as well as the rewards linked to performance. According to the Mathis and Jackson (2000) Maslow’s hierarchy of needs also discuss about the employee reward system because it is their main need.
Figure 05- performance management
Rewards are a powerful system which encourages employees on their job performance. Some of the works highly concerned about the non monetary rewards such as appreciations, smile, and recognition and etc. The company is able to offer rewards when the employee is exceeding the company expectations. It is offered after the job performance and it is important to maintain the customer expectations as well. Most of the marketing related employees offer different type of rewards than their fixed income. In banking sector most of the organisations offer rewards when the employees cover their targets. They are required to find new customers and when they exceed the target number employees are able to offer rewards bones, commission and etc. Most of the banking companies select the best employee of the month and best marketer of the month. As an example HSBC offers several rewards to motivate their employees and to get maximum performance from them. There has team concept and when the employees cover the team targets that time also they are able to get profit or rewards. Promotions are one of the reward systems which are coming under non monetary rewards. These reward systems are designed by the company HRM and it has to connect with the company goals and objectives. The following figure 06 is shown how to design a reward system in an organisation. Any reward system should be specific, meaningful, achievable, reliable, and timely.
According to the Armstrong (2008) Reward system can categorize into four groups such as transactions, relational communal and individual. Transactional rewards can mention as tangible rewards and it is mainly included financial rewards. This is can do according to the competitors do in the market place. Intangible rewards can mention as relational rewards. These rewards are important to increase the level of tangible rewards. Relational and communal rewards are recognized, employee voice and etc. Recognition is important to have in a working environment since it can make several changes in the organisation. It shows that company is caring about them and looks for their performance. When the employees feel that their work is appreciate can be happier and it will be something that HRM or the organisation can give free of cost.
Figure 06- reward system design
Employee participation and trade unions
Employee participation is important to have within any organisation since it is a main process of decision making and it is a part of empowerment. Empowerment is important to create a work place environment friendlier and team working is developmentally the empowerment. Employee participation is important for the HRM development as well. When there is employee participation it can develop the customer satisfaction and expiations. In the banking sector most of the time there is employee participation in meetings, multi channel decision making, suggestion schemes, project teams and etc. This is significant since it is made more benefits to the organisation. Employee participation has increased the productivity level of the organisation and it is significant to change the employee attitudes and company environment as well. Other than that employees are able to work life balance when they have employee participation since they can discuss their issues and clarity it with the HRM.
According to the Phil (2007) Trade unions are organisation of works that have common goals to achieve better working environment. They do the bargaining and try to get better from the employers and they always take the employees’ side of their problems. Their purpose is to improve the working conditions. Most of the time trade unions bargain for wages, rules and regulations, benefits, hiring procedures and etc. According to the Johnson (2004) in the UK there is 28% trade union density.
Most of the time employees in the banking sector have employee participation and they involved with the company decision making and companies get their support on projects and other decision makings. At the same time employees and the company are updating the trade unions about the company changes and future programs. When they need to do policy changes and other changes relating to Employees, Company and the trade union do discussions and end of the session they come to a conclusion. Therefore companies can’t take decisions as they want and they need to get employees and the trade union advice and support on this. When the employees participate trade unions also can’t argue with the company unnecessarily since employers know the process.
Figure 09- Employee Involvement
In any organisation HRM is playing a major role and there are common functions like recruitment and selection, training and development, rewards and performance, employee participation and trade unions and etc under the HRM department. It is important to have well planned HRM functions with any organisation. In banking sector most of the international banks do recruitment and selection by using special methods and they highly consider their education, physical ability, education, background and etc. It is important to maintain training and development programs to maintain employee performance and it is supported to develop their knowledge, skills and attitudes. Like banking organisations can conduct on the job training programs since they have to deal with customers and while they work they are able to learn things quickly and it is more practical than classroom training. This is significant to increase productivity and turnover of the organisation. The company should have properly designed reward system which is connected with the performance system. When the employees exceed the company requirements then only company should offer rewards. But they should give more attention for non monetary rewards as well, Since it doesn’t cost anything for non monetary rewards like recognition, smile and etc. Through the training programs it is important to develop the workers’ communication abilities, risk management, work life balancing, language development, customer care and public relations and etc.
When the HRM does proper planning in training and development programs it will benefit to the organisation, customers as well as the employees. In banking sector all the employees should have some knowledge about the other roles as well. Through that company is able to make real changes, job modifications and this is important to do recruitments internally as well. All the training and development programs should link with the company goals and objectives. As well as employees should have a proper idea about the company goals. Team building is important in banking sector to achieve targets. Companies can arrange a reward system to offer when the employee obtain team targets. This should apply to all the departments of the organisation without limit to one or two.
Employee participation is important to in company decision making and HRM should get employee support on projects and other decisions relating to work. It is important to build good connection with the trade unions since they always looked at the organisations and them always there for the employees. Therefore companies should have proper policies and procedures about all the functions they handle and especially HRM should have a better understanding about the trade unions. The company is able to arrange some activities like charitable events and etc with trade unions to develop understanding among each group.
This assignment is based on the HRM functions which are highly important to an organisation and it is mainly discussed about the banking sector in the UK. It is discussed about the recruitment and selection, training and development, rewards and performance management, employee participation and trade unions. Through this report it is discussed how these functions operate by the HRM and how to develop each of the functionality and benefits of it. At the end it is given some recommendation to develop all the functions discuss within the report.
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