Training & development practices in banking sector
The Jews in Jerusalem introduced a kind of banking in the form of money lending before the birth of Christ. The word ‘Bank‘ was probably derived from the word ‘bench’ as during ancient time Jews used to do money -lending business sitting on long benches.
First modern banking was introduced in 1668 in Stock Holm as ‘Svingss Pis Bank’ which opened up a new era of banking activities throughout the European Mainland.
In the South Asian region, early banking system was introduced by the Afghan traders popularly known as Kabuliwallas. Muslim businessmen from Kabul, Afghanistan came to India and started money lending business in exchange of interest sometime in 1312 A.D. They were known as ‘Kabuliwallas’.
NUMBER AND TYPES OF BANKS
The number of banks in all now stands at 49 in Bangladesh. Out of the 49 banks, 4 are Nationalized Commercial Banks, 28 local private commercial banks, 12 foreign banks and the rest five are Development Financial Institutions.
Sonali Bank is the largest among Nationalized Commercial Bank the while Pubali is leading in the private ones. Among the 12 foreign banks, Standard Chartered has become the largest in the country. Besides the scheduled banks, Samabai (Cooperative) Bank, Ansar-VDP Bank, Karmasansthan (Employment) Bank and Grameen bank are functioning in the financial sector. The number of total branches of all scheduled banks is 6,038 as of June 2000. Of the branches, 39.95 per cent (2,412) are located in the urban areas and 60.05 per cent (3,626) in the rural areas. Of the branches Nationalized Commercial Banks, hold 3,616, private commercial banks 1,214, foreign banks 31 and specialized banks 1,177.
Bangladesh Bank (BB) regulates and supervises the activities of all banks. The BB is now carrying out a reform program to ensure quality services by the banks.
Sonali Bank Limited
Overview of the Bank Sonali Bank Limited, the largest & leading commercial bank of the country, came into being in 1972 immediately after the emergence of Bangladesh as an independent state. A fully state-owned enterprise, the bank has been discharging its nation-building responsibilities by undertaking government entrusted different socio-economic schemes as well as money market activities of its own volition, covering all spheres of the economy. Sonali Bank Limited singularly enjoys the prestige of being the agent of the Central Bank of Bangladesh in such places where the guardian of the money market has chosen not to act by itself.
Sonali Bank Limited is governed by a Board of Directors consisting of 9(nine) members headed by a Chairman. The Bank is headed by the Chief Executive Officer & Managing Director, who is a well-known Banker and a reputed professional. The head office of the bank along with its corporate structure is located at Motijheel, Dhaka, and the main commercial center of the capital.
Rupali Bank is a commercial bank in Bangladesh. It was established as a nationalized bank in 1972 under the Bangladesh Banks Nationalization Order, through the amalgamation of the branches of Muslim Commercial Bank, Australasia Bank and Standard Bank that were operating in East Pakistan, following the 1971 Bangladesh Liberation War. The bank was denationalized in 1986, and reorganized as a limited company, with the Government of Bangladesh holding 51% shares. However, after the year 2000, the Government divested of its shares, and the privatization of the bank was complete.
Rupali Bank Ltd. was constituted with the merger of 3 (three) erstwhile commercial banks i.e. Muslim Commercial Bank Ltd., Australasia Bank Ltd. and Standard Bank Ltd. operated in the then Pakistan on March 26, 1972 under the Bangladesh Banks (Nationalization) Order 1972 (P.O. No. 26 of 1972), with all their assets, benefits, rights, powers, authorities, privileges, liabilities, borrowings and obligations. Rupali Bank worked as a nationalized commercial bank till13, August. Rupali Bank Ltd. emerged as the largest Public Limited Banking Company of the country on December 14, 1986
Pubali Bank Limited was initially established in the Banking scenario of the then East Pakistan as Eastern Mercantile Bank Limited at the initiative of some Bangalee entrepreneurs in the year 1959 under Bank Companies Act 1913. After independence of Bangladesh in 1972 this Bank was nationalized as per policy of the Government and renamed as Pubali Bank. Subsequently due to changed circumstances this Bank was denationalized in the year 1983 as a private bank and renamed as Pubali Bank Limited. The Government of the People’s Republic of Bangladesh handed over all assets and liabilities of Pubali Bank to Pubali Bank Limited. Since then Pubali Bank Limited has been rendering all sorts of Commercial Banking services as the largest bank in private sector through its branch network all over the country.
Pubali Bank Limited the successor of the former Eastern Mercantile Bank Limited incorporated in 1959 under the companies act 1913. Eastern Mercantile Bank Ltd was nationalized under Bangladesh Bank’s (Nationalization) Order 1972 and was renamed as Pubali Bank. It was denationalized on 30 June 1983 under the Bangladesh Bank’s (Nationalization) Amendment Ordinance 1983. In 1972, the authorized and paid up capital of Pubali Bank was TK 50 million and TK 10 million respectively. At the time of denationalization in 1983, the paid up capital of the bank was TK 20 million. In 1984, the authorized and paid up capital of the bank was enhanced to TK 160 million divided into 1.6 million ordinary shares of TK 100 each. In the same year, the bank created a reserve fund of TK 2.30 million. Following the expansion of business activities along with the increases in the volume of assets and liabilities, authorized capital was raised to TK 5,000 million at the end of the business year 1999, while the paid up capital remained unchanged. Reserve funds of the bank were enhanced to TK 644.2 million in December 1999. The bank is listed with both Dhaka and Chittagong Stock Exchanges.
The functions of the bank include deposit mobilization, financing productive activities, conducting foreign exchange business and providing various types of banking services to the customers. Total deposits of the bank on 31 December 1972 were TK 767.98 million, which rose to TK 5,409.11 million in December 1984. Total loans and advances of the bank during these two reference periods were TK 471.64 million and TK 4,333.46 million respectively. Total liabilities (assets) of bank were valued at TK 7,233.64 million on 31 December 1984. Compared to these, the value of total deposits, total loans and advances, and total liabilities (assets) on 31 December 2000 was TK 29,590.1 million, TK 21,572.2 million and TK 33,436.9 million respectively. The deposits comprised savings deposits TK 11,608.6 million, fixed deposits Tk 5,557.3 million, current deposits TK 3,933.1 million, and other deposits TK 8491.1 million.
Interest rate offered by the bank varied between 6.5% to 9%. The landings were mostly in Jute, textile, readymade garments and other large, medium and small scale industries, transport, housing, small loans, rural and agricultural credit, micro credit, credit to trade and commerce and export-import financing. Rates of interest charged on its loans and advances varied between 13% and 16%. The bank has huge non-performing loans and the classified loans amounted to TK 7,601.5 million (35.24% of total) on 31 December 2000. In 2000, the bank financed 298 projects in large, medium and small-scale industries. In addition to loans and advances, the bank lent TK 230 million in the call money market and borrowed TK 309 million from the inter-bank call money market in 2000.
Foreign exchange business handled by the bank in 2000 amounted to TK 15,930 million which comprised export servicing TK 6,100 million, import financing TK 8,270 million, and remittance services TK 1,560 million. The bank has correspondent relationships with 554 banks all over the world. Investments of the bank in 1999 stood at TK 3,318 million in government securities, income tax bond, treasury bills, loans to government, national investment bond, bridge financing, shares and debentures of companies and national prize bonds. The bank earned net profits after taxes but before adjusting provision requirements in all years from 1984 to 2000 except 1990 and 1991.
The management of the bank is vested in a 14-member board of directors with the managing director as its chief executive. In 2001, the bank had 350 branches (196 urban and 154 rural) and the total number of its employees was 4,882.
Private bank in Bangladesh
First generation bank in Bangladesh
National Bank Limited:
National Bank Limited has its prosperous past, glorious present, prospective future and under processing projects and activities. Established as the first private sector Bank fully owned by Bangladeshi entrepreneurs, NBL has been flourishing as the largest private sector Bank with the passage of time after facing many stress and strain. The member of the board of directors is creative businessman and leading industrialist of the country. To keep pace with time and in harmony with national and international economic activities and for rendering all modern services, NBL, as a financial institution automated all its branches with computer network in accordance with the competitive commercial demand of time.
The emergence of National Bank Limited in the private sector is an important event in the Banking arena of Bangladesh. When the nation was in the grip of severe recession, Govt. took the farsighted decision to allow in the private sector to revive the economy of the country. National Bank Limited was born as the first hundred percent Bangladeshi owned Bank in the private sector. From the very inception it is the firm determination of National Bank Limited to play a vital role in the national economy. We are determined to bring back the long forgotten taste of banking services and flavors. We want to serve each one promptly and with a sense of dedication and dignity.
At present, NBL has been carrying on business through its 106 branches spread all over the country. Besides, the Bank has drawing arrangement with 415 correspondents in 75 countries of the world as well as with 37 overseas Exchange Companies located in 13 countries. NBL was the first domestic bank to establish agency arrangement with the world famous Western Union in order to facilitate quick and safe remittance of the valuable foreign exchanges earned by the expatriate Bangladeshi nationals. NBL was also the first among domestic banks to introduce international Master Card in Bangladesh. In the meantime,
National Bank, has now acquired strength and expertise to support the banking needs of the foreign investors. NBL stepped into a new arena of business and opened its Off Shore Banking Unit at Mohakhali to serve the wage earners and the foreign investors better than before.
Transparency and accountability of a financial institution is reflected in its Annual Report containing its Balance Sheet and Profit & Loss Account. In recognition of this, NBL was awarded Crest in 1999 and 2000, and Certificate of Appreciation in 2001 by the Institute of Chartered Accountants of Bangladesh.
A team of highly qualified and experienced professionals headed by the Managing Director of the Bank who has vast banking experience operates bank and at the top there is an efficient Board of Directors for making policies.
National Credit and Commerce Bank Ltd
National Credit and Commerce Bank Ltd. bears a unique history of its own. The organization started its journey in the financial sector of the country as an investment company back in 1985. The aim of the company was to mobilize resources from within and invest them in such way so as to develop country’s Industrial and Trade Sector and playing a catalyst role in the formation of capital market as well. Its membership with the browse helped the company to a great extent in this regard. The company operated unto 1992 with 16 branches and thereafter with the permission of the Central Bank converted in to a full fledged private commercial Bank in 1993 with paid up capital of TK. 39.00 corer.
Since its inception NCC Bank Ltd. has acquired commendable reputation by providing sincere personalized service to its customers in a technology based environment.
The Bank has set up a new standard in financing in the Industrial, Trade and Foreign exchange business. Its various deposit & credit products have also attracted the clients-both corporate and individuals who feel comfort in doing business.
Second generation bank in Bangladesh
Dhaka Bank Limited
Bangladesh economy has been experiencing a rapid growth since the ’90s. Industrial and agricultural development, international trade, inflow of expatriate Bangladeshi workers’ remittance, local and foreign investments in construction, communication, power, food processing and service enterprises ushered in an era of economic activities. Urbanization and lifestyle changes concurrent with the economic development created a demand for banking products and services to support the new initiatives as well as to canalize consumer investments in a profitable manner. A group of highly acclaimed businessmen of the country grouped together to responded to this need and established Dhaka Bank Limited in the year 1995.
The Bank was incorporated as a public limited company under the Companies Act. 1994. The Bank started its commercial operation on July 05, 1995 with an authorized capital of TK. 1,000 million and paid up capital of TK. 100 million. The paid up capital of the Bank stood at TK 1,934,252,875 as on June 30, 2008. The total equity (capital and reserves) of the Bank as on June 30, 2008 stood at TK 3,424,609,016.
The Bank has 44 branches, 2 SME Service Centers, 1 Business Center, 2 Offshore Banking Units across the country and a wide network of correspondents all over the world. The Bank has plans to open more branches in the current fiscal year to expand the network.
The Bank offers the full range of banking and investment services for personal and corporate customers, backed by the latest technology and a team of highly motivated officers and staff.
In our effort to provide Excellence in banking services, the Bank has launched Online Banking service, joined a countrywide shared ATM network and has introduced a co-branded credit card. A process is also underway to provide e-business facility to the bank’s clientele through Online and Home banking solutions.
Dhaka Bank Ltd. is the preferred choice in banking for friendly and personalized services, cutting edge technology, tailored solutions for business needs, global reach in trade and commerce and high yield on investments
Southeast Bank Ltd
Southeast Bank Limited is a scheduled commercial bank in the private sector established under the ambit of Bank Company Act, 1991 and incorporated as a Public Limited Company under Companies Act, 1994 on March 12, 1995. The Bank started commercial banking operations on May 25, 1995. During this short span of time the Bank has succeeded in positioning itself as a progressive and dynamic financial institution in the country. The bank has been widely acclaimed by the business community, from small entrepreneurs to large traders and industrial conglomerates, including the top-rated corporate borrowers, for its forward – looking business outlook and innovative financial solutions. Thus within this very short period of time it has been able to create an image and earn significant reputation in the country’s banking sector as a Bank with Vision. Presently, it has 46 branches
Southeast Bank Limited has been licensed by the Government of Bangladesh as a Scheduled commercial bank in the private sector in pursuance of the policy of liberalization of banking and financial services and facilities in Bangladesh. In view of the above, the Bank, within a period of 14 years of its operation, achieved remarkable success fully meeting capital adequacy requirement of Bangladesh Bank
As evident from the financial statements for the last 10 years, it has been growing rapidly as one of the leaders of the new generation banks in the private sector in term of business and profitability.
Third generation bank in Bangladesh
Trust Bank Limited
Trust Bank Limited is one of the leading private commercial bank having a spread network of 39 branches across Bangladesh and plans to open few more branches to cover the important commercial areas in Dhaka, Chittagong, Sylhet and other areas in 2008. The bank, sponsored by the Army Welfare Trust (AWT), is first of its kind in the country. With a wide range of modern corporate and consumer financial products Trust Bank has been operating in Bangladesh since 1999 and has achieved public confidence as a sound and stable bank.
In 2001, the bank introduced automated branch banking system to increase efficiency and improve customer service. In the year 2005, the bank moved one step further and introduced ATM services for its customers.
Since bank’s business volume increased over the years and the demands of the customers enlarged in manifold, our technology has been upgraded to manage the growth of the bank and meet the demands of our customers.
In January 2007, Trust Bank successfully launched Online Banking Services which facilitate Any Branch Banking, ATM Banking, Phone Banking, SMS Banking, & Internet Banking to all customers. Customers can now deposit or withdraw money from any Branch of Trust Bank nationwide without needing to open multiple accounts in multiple Branches.
Via Online Services and Visa Electron (Debit Card), ATMs now allow customers to retrieve 24×7 hours Account information such as account balance checkup through mini-statements and cash withdrawals.
Trust Bank is about to introduce Visa Credit Cards to serve it’s existing and potential valued customers. Credits cards can now be used at shops & restaurants all around Bangladesh and even internationally.
Trust Bank is a customer oriented financial institution. It remains dedicated to meet up with the ever growing expectations of the customer because at Trust Bank, customer is always at the center.
HSBC Bank Bangladesh
HSBC Bangladesh Pvt. Ltd started operations in 1996. It is part of the HSBC Group. The bank primarily focuses on urban areas have branches in most areas of the capital city of Dhaka, it also has branches in the cities of Chittagong and Sylhet. The bank also has a good number of ATM booths in the cities present; it also has booths in most five star hotels.
HSBC Bangladesh is rated ‘AAA’ in the Long-term and ST-1 rating in the Short-term, which are the highest level of ratings for any bank or financial institution in Bangladesh.
HSBC Bangladesh offers a comprehensive range of financial services such as commercial banking, consumer banking, payments and cash management, trade services, treasury, and custody and clearing. The bank also offers offshore banking in the Export Processing Zones, this is only limited to investors in the EPZs. A special service called NRB Services is also available for non resident Bangladeshis; this service allows consumers to maintain accounts in US Dollars, Pound Sterling and Euros. People using this service can freely remit money from Bangladesh to any part of the world and can access their money from any HSBC booth around the world
The origin of Grameen Bank can be traced back to 1976 when Professor Muhammad Yunus, Head of the Rural Economics Program at the University of Chittagong, launched an action research project to examine the possibility of designing a credit delivery system to provide banking services targeted at the rural poor. The Grameen Bank Project (Grameen means “rural” or “village” in Bangla language) came into operation
The action research demonstrated its strength in Jobra (a village adjacent to Chittagong University) and some of the neighboring villages during 1976-1979. With the sponsorship of the central bank of the country and support of the nationalized commercial banks, the project was extended to Tangail district (a district north of Dhaka, the capital city of Bangladesh) in 1979. With the success in Tangail, the project was extended to several other districts in the country. In October 1983, the Grameen Bank Project was transformed into an independent bank by government legislation. Today Grameen Bank is owned by the rural poor whom it serves. Borrowers of the Bank own 90% of its shares, while the remaining 10% is owned by the government.
Grameen Bank at a Glance
Nobel Peace Prize, 2006
October 13, 2006 was the happiest day for Bangladesh. It was a great moment for the whole nation. Announcement came on that day that Grameen Bank and I received the Nobel Peace Prize, 2006. It was a sudden explosion of pride and joy for every Bangladeshi. All Bangladeshi’s felt as if each of them received the Nobel Peace Prize. We were happy that the world has given recognition through this prize, that poverty is a threat to peace. Grameen Bank, and the concept and methodology of micro-credit that it has elaborated through its 30 years of work, have contributed to enhancing the chances of peace by reducing poverty. Bangladesh is happy that it could contribute to the world a concept and an institution which can help bring peace to the world.
Owned by the Poor
Grameen Bank Project was born in the village of Jobra, Bangladesh, in 1976. In 1983 it was transformed into a formal bank under a special law passed for its creation. It is owned by the poor borrowers of the bank who are mostly women. It works exclusively for them. Borrowers of Grameen Bank at present own 95 per cent of the total equity of the bank. Remaining 5 per cent is owned by the government.
Grameen Bank has 2,556 branches. It works in 84,388 villages. Total staff is 23,445
Over Tk 451 billion disbursed
Total amount of loan disbursed by Grameen Bank, since inception, is Tk 451.58 billion (US $ 8.07 billion). Out of this, Tk 401.60 billion (US $ 7.16 billion) has been repaid. Current amount of outstanding loans stands at TK 49.97 billion (US $ 724.04 million). During the past 12 months (from June’08 to May’09) Grameen Bank disbursed Tk. 70.34 billion (US $ 1023.33 million). Monthly average loan disbursement over the past 12 month was Tk 5.86 billion (US $ 85.28million).
Projected disbursement for year 2009 is Tk 75.00 billion (US $1091 million), i.e. monthly disbursement of Tk 6.25 billion (US $ 90.92 million). End of the year outstanding loan is projected to be at Tk. 55.00 billion (US $ 800 million).
100 per cent Loans Financed From Bank’s Deposits
Grameen Bank finances 100 per cent of its outstanding loan from its deposits. Over 54 per cent of its deposits come from bank’s own borrowers. Deposits amount to 136 per cent of the outstanding loans. If we combine both deposits and own resources it becomes 149 per cent of loans outstanding
Ever since Grameen Bank came into being, it has made profit every year except in 1983, 1991, and 1992. It has published its audited balance-sheet every year, audited by two internationally reputed audit firms of the country.
Low Interest Rates
Government of Bangladesh has fixed interest rate for government-run microcredit programmes at 11 per cent at flat rate. It amounts to about 22 per cent at declining basis. Grameen Bank’s interest rate is lower than government rate.
There are four interest rates for loans from Grameen Bank: 20% for income generating loans, 8% for housing loans, 5% for student Government of Bangladesh has fixed interest rate for government-run microcredit programmes at 11 per cent at flat rate. It amounts to about 22 per cent at declining basis. Grameen Bank’s interest rate is lower than government rate.
There are four interest rates for loans from Grameen Bank: 20% for income generating loans, 8% for housing loans, 5% for student.
Evolution of human Resource Management
Human Resource Management involves all management decisions and practices that directly affect of influence the people, or human resources who work for the organization. Human Resource Management has become one of the crucial parts of organization because an organization’s employees enable an organization to achieve it’s goal human resource is a primary resource without which other resources, physical and financial, can’t be put into use. So, the management of Human Resources plays a critical role to an organization’s success.
Definition of Human Resource Management
Human Resource Management is a process and organizations together so that the goals of each are met. It is that part of the management process which is concerned with the management of human resources is an organization. It tries to secure the best form people by winning their whole hearted co-operation. In short, it may be fined as the art of procuring, developing and maintaining competent work force to achieve the goals of an organization is an effective and efficient manner.
Human Resource/personnel management may be defined as the art of procuring, developing and maintaining competent workforce to achieve organizational goals efficiently.
According to Flippo,” Human Resource/ personal Management is the planning, organizing, directing and controlling of the procurement, development, compensation, itergration, maintenance and separation of human resources to the end that individual, organizational and social objectives are accomplished,”
According to E.F.L. Breach,” Personnel Management is the part of management process which is primarily concerned with the human constituents of an organization.
In the words of Richard Calhoon,” Personnel management involves the task of handing the human problems of an organization and is devoted to acquiring, developing, utilizing and maintaining an efficient work-force.”
According to R.G. Gokhle,” Personnel Management is the specialized intelligent handing of the human factor by a separate department which could devote its full time for research along the line of improvement is industrial relations.”
In other words, it can be said that personal Management is concerned with people at work and their relationships with each other. It may be defined as a set of programmers, functions and activities designed to maximize both personal and organizational goals.
Functions of Human Resource Management
Human Resource Management consists of the following functions each of which includes multiple equally important activities which collectively contribute to the organization’s success:
– Human Resource Planning
Human resource Planning, HRP, is a planning process by which an organization can move from its current manpower position to its desired manpower position. Through manpower planning, an organization strives to have the right number and right kinds of people at the right time. More appropriately, man power planning is defined as a strategy for acquisition, utilization, improvement, and retention of human resources.
– Acquiring Human Resources
Part of human resource planning that refers to staffing activities that include recruiting applicants, screening, selecting the most qualified candidates, and filling some positions through transfer and promotions.
– Training and development
Training and development is an important activity of human resource management. Training can be defined as the systematized tailor made program to suit the needs of particular organization for developing certain attitudes, action, skills, and abilities in employees irrespective of their functional levels.
– performance management
Performance management is an ongoing process that identifies organizational vision and objectives, installs organizational and individual performance standards, and ensures these standards using system and procedures that are well-integrated with organizational culture and practices.
– compensation management
Compensation management, the most critical and important division of human resource management, mainly deals with designing and administering a compensation system that rewards employees fairly while stimulating them to provide goods and services that satisfy customers demands and permitting the organizational to operate profitable and competently. Organizational success heavily depends on efficiency of compensation system. The first and foremost part of the compensation management is the designing of base pay structure for an organizational employee.
Value of human Resource Management
As we know, the term ‘human resource management’ underlines a belief that people really make the difference, only people among other resources have the capacity to generate value. However, the human resource management is considered as the ‘Cinderella’ in the organization as its importance has not been discovered by the senior managers, in addition, it has to share responsibilities with line managers, sometimes it takes more work than it is expected. Actions should be taken to help the Cinderella find her glass shoes.
Human resource management (HRM), as defined by Bratton, J. & Gold, J. (2003), is
“A strategic approach to managing employment relations which emphasizes that leveraging people’s capabilities is critical to achieving sustainable competitive advantage, this being achieved through a distinctive set of integrated employment policies, programmers and practices.
According to this definition, we can see that human resource management should not merely handle recruitment, pay, and discharging, but also should maximize the use of an organization’s human resources in a more strategic level. To describe what the HRM does in the organization, Ulrich, D. & Brockle bank, W. (2005) have outlined some of the HRM roles such as employee advocate, human capital developer, functional expert, strategic partner and HR leader etc.
It seems that HRM is so crucial to the organization, for what it does has nearly covered all aspects of the business – from strategic planning to the training and development, but unfortunately, its importance has not been accepted by everyone.
Model of Human Resource Management
In recent years there has been relative agreement among HRM specialists as to what constitutes the field of HRM. The model that provided the focus was developed by the American Society for training and Development (ASTD). In this study identified nine human resources areas:
-Training and Development
-Organization and Development
-Human resources planning
-Selection and staffing
-Personal Research and Information systems
The outputs of this model are:
-Quality of work life:
Quality of work life is a multifaceted concept. The premise of quality of work life is having a work environment where an employee’s activities become more important. This means implementing procedures or policies that makes the work less routine and more rewarding for the employee. These procedures or policies include autonomy, recognition, belonging, progress and development and external rewards.
Productivity is the quantity or volume of the major product or services that an organization provides. In other words, it is the amount of work that is being produced in the organization, in terms of how much and how well. High productivity is that makes an organization thrive. Without a good product or services to sell, problems in an organization are sure to arise. Accordingly, productivity improvement programs are becoming more popular with organizations.
· Readiness for change:
If one thing in the world could be said that is always true, it would be that things will never remain the same. Change is a fact of life in both our private and our work lives. The change might be subtle, such as getting a new boss. To reduce the fear associated with change, training is important. Once the secretary has been given time to learn how to use the new equipment, and to experience how efficient it is and it makes her job easier, the fear of change can be reduced.
Challenges of Human Resources management
The HRM Professionals got a bit lazy in the recent years and the next year will make them to move and think creatively again. The HRM Professionals were used to bring new costly initiatives to the organization and they have to be creative now how to cut them.
The main HRM Challenges 2009 will be the following:
- Protecting the top potentials of the organization. The number of people on the job market will quickly rise, but the top potentials will be always wanted. The smart approach will be very important.
- Smart training budget management. The training will not be for every single employee. Just the top potentials and key employees will be allowed to get any training and the HRM Function has to be smart in the training budget management.
- Headcount Freeze. The headcount of the organization has to be under a control and the employees have to be moved around the organization. Headcount Freeze is very painful for the line management and the HRM Function is the frustration target number one.
- Base Salaries Management. The pressure will be enormous. The Compensation and Benefits Specialists will have a tough year to meet the defined targets. The base salaries will be under a huge pressure and the managers will try to use every technique to get additional funds for their employees.
- Positive Communication. Even the year 2009 will be very tough, the HRM Function has to communicate honestly, openly and positively. Very hard, but the employees have to feel the trust to the HRM Words.
The year 2008 was about nice initiatives, the year 2009 is about the hard work. The HRM Challenges 2009 look very tough, but the smart HRM Professionals can manage them. And it will be a nice lesson as well.
‘Training and Development: Literature review’
Every organization needs to have well-trained and experienced people to perform the activities that have to be done. If current or potential job occupants can meet this requirement, training is not important. When this is not the case, it is necessary to raise the skill levels and increase the versatility and adaptability of employees.
Meaning of training
Training is a learning experience in that it seeks a relatively permanent change in an individual that will improve his or her ability to perform on the job. We typically say training can involve the changing of skills, knowledge, attitudes, or social behavior. It may mean changing what employees know, how they work, their attitudes towards their work, or their interactions with their co-workers or their supervisor.
For another purpose, Training will be presented as it applies primarily to operative employees in the organization
Method of training
The most popular training methods used by organization can be classified as either on-the-job of off-the-job training.
On-the job training
The most widely methods of training take place on the job. This can be attributed to the simplicity of such methods and the impression that they are less costly to operate. On-the job training places the employees in an actual work situation and makes them appear to be immediately productive. It is learning by doing. For jobs that either are on the job training makes sense.
One of the drawbacks to on the job training can be low productivity while the employees develop their skills. Another drawback can be the errors made by the trainees while they learn. However, when and personnel are limited or costly, and where it is desirable for the workers to learn the job under normal working conditions, the benefits of on the job training frequently offset its drawbacks. Apprenticeship Programs. People seeking to enter skilled trades to become, for example. Plumbers, electricians, or ironworkers are often required to undergo apprenticeship training before they are accepted to journeyman status typically, this apprenticeship period is from two to five years .For instance, a cosmetician’s apprenticeship is two years, a bricklayer’s is three years, machinists and printers spend four years, and a patternmaker requires five years. During the apprenticeship period, the trainee is paid less than a fully qualified worker.
Apprenticeship programs put the trainee under the guidance of a master worker. The argument for apprenticeship programs is that the required job knowledge and skills are so complex as to rule out anything less than a long time period where the trainee understudies a skilled master journeyman.
Job Instruction Training. During World War II, a systematic approach to on-the –job training was developed to prepare supervisors to train operatives. This approach, called job instruction training (JIT) was part of the Training within Industry programs. JIT proved highly effective and became extremely popular. JIT consists of four basic steps: (1) preparing the trainees by telling them about the job and overcoming their uncertainties; (2) presenting the instruction, giving essential information in a clear manner; (3) having the trainees try out the job to demonstrate their understanding; understanding; and (4) placing the workers into the job, on their own, with a designated resource person to call upon should they need assistance. The sequence of these activities is shown in finger 10-3.
A revival of JIT achieved impressive result. When twenty supervisors who had received training for twenty –five hours over ten weeks in turn retrained their subordinates, all but three supervisors were able to show tangible result of job training in their areas. Productivity was significantly improved, and rejects where cut by approximately yow-thirds.
Off-the Job Training
Off-the –job training covers a number of techniques –classroom lectures, films, demonstrations; case, studies and other simulation exercises, and programmed instruction. The facilities needed for each of these techniques very from a small makeshift classroom to an elaborate development center with large lecture halls, supplemented by small conference rooms with sophisticated audiovisual equipment, tow-way mirrors, and all the frills.
Off – the job training is given outside the actual work place.
Lectures/Conferences: – This approach is well adapted to convey specific information, rules, procedures or methods. This method is useful, where the information is to be shared among a large number of trainees. The cost per trainee is low in this method.
Films: – can provide information & explicitly demonstrate skills that are not easily presented by other techniques. Motion pictures are often used in conjunction with Conference, discussions to clarify & amplify those points that the film emphasized.
Simulation Exercise: – Any training activity that explicitly places the trainee in an artificial environment that closely mirrors actual working conditions can be considered a Simulation. Simulation activities include case experiences, experiential exercises, vestibule training, management games & role-play.
Cases: – present an in depth description of a particular problem an employee might encounter on the job. The employee attempts to find and analyze the problem, evaluate alternative courses of action & decide what course of action would be most satisfactory.
Experiential Exercises: – are usually short, structured learning experiences where individuals learn by doing. For instance, rather than talking about inter-personal conflicts & how to deal with them, an experiential exercise could be used to create a conflict situation where employees have to experience a conflict personally & work out its solutions.
Vestibule Training: – Employees learn their jobs on the equipment they will be using, but the training is conducted away from the actual work floor. While expensive, Vestibule training allows employees to get a full feel for doing task without real world pressures. Additionally, it minimizes the problem of transferring learning to the job.
Role Play: – It’s just like acting out a given role as in a stage play. In this method of training, the trainees are required to enact defined roles on the basis of oral or written description of a particular situation.
Management Games: – The game is devised on a model of a business situation. The trainees are divided into groups who represent the management of competing companies. They make decisions just like these are made in real-life situations. Decisions made by the groups are evaluated & the likely implications of the decisions are fed back to the groups. The game goes on in several rounds to take the time dimension into account.
In-Basket Exercise: -Also known as In-tray method of training. The trainees is presented with a pack of papers & files in a tray containing administrative problems & is asked to take decisions on these problems & are asked to take decisions on these within a stipulated time. The decisions taken by the trainees are compared with one another. The trainees are provided feedback on their performance.
Reasons for Training
Typical Reasons for Employee Training and Development
Training and development can be initiated for a variety of reasons for an employee or group of employees, e.g:
- When a performance appraisal indicates performance improvement is needed
- To “benchmark” the status of improvement so far in a performance improvement effort
- As part of an overall professional development program
- As part of succession planning to help an employee be eligible for a planned change in role in the organization
- To “pilot”, or test, the operation of a new performance management system
- To train about a specific topic (see below)
Typical Topics of Employee Training
- Communications: The increasing diversity of today’s workforce brings a wide variety of languages and customs.
- Computer skills: Computer skills are becoming a necessity for conducting administrative and office tasks.
- Customer service: Increased competition in today’s global marketplace makes it critical that employees understand and meet the needs of customers.
- Diversity: Diversity training usually includes explanation about how people have different perspectives and views, and includes techniques to value diversity
- Ethics: Today’s society has increasing expectations about corporate social responsibility. Also, today’s diverse workforce brings a wide variety of values and morals to the workplace.
- Human relations: The increased stresses of today’s workplace can include misunderstandings and conflict. Training can people to get along in the workplace.
- Quality initiatives: Initiatives such as Total Quality Management, Quality Circles, benchmarking, etc., require basic training about quality concepts, guidelines and standards for quality, etc.
- Safety: Safety training is critical where working with heavy equipment , hazardous chemicals, repetitive activities, etc., but can also be useful with practical advice for avoiding assaults, etc.
- Sexual harassment: Sexual harassment training usually includes careful description of the organization’s policies about sexual harassment, especially about what are inappropriate behaviors.
There are numerous sources of online information about training and development. Several of these sites (they’re listed later on in this library) suggest reasons for supervisors to conduct training among employees. These reasons include:
- Increased job satisfaction and morale among employees
- Increased employee motivation
- Increased efficiencies in processes, resulting in financial gain
- Increased capacity to adopt new technologies and methods
- Increased innovation in strategies and products
- Reduced employee turnover
- Enhanced company image, e.g., conducting ethics training (not a good reason for ethics training!)
- Risk management, e.g., training about sexual harassment, diversity training
An organization already provides extensive employee and management development programs. A long term career focus should increase the organization’s effectiveness in managing its human resources
Meaning of Development
Employee development is more future oriented, and more concerned with education, than is employee training, or assisting a persons to become a performance. By education, we mean that Employee development activities attempt to instill sound reasoning process-to enhance one’s ability to understand and interpret knowledge rather than imparting a body of serial facts or teaching a specific set of motor skills. Development therefore focuses more on the employee’s personal growth. Successful managers have analytical, human, conceptual, and specialized skills. They are able to think and understand. Training per se cannot overcome a manager’s or potential inability to understand cause-and-effect relationships, to synthesize from experience, to visualize relationships, or to think relationships or to think logically.
Methods of Development
The development of a manager’s abilities can take place on the job. We will review four popular on-the-job techniques
Coaching: when a manager’s takes an active role in guiding another manager’s, we refer to this activity as coaching. Just as track coaches observe, analyze, and attempt to improve the performance of their athletes ‘coaches’ on the job can do the same. The effective coach on the track or in the corporate hierarchy gives guidance through direction, advice, criticism, and suggestions in attempts to aid the growth of the employee.
Understudy Assignments: By Understudy Assignments, we mean potential managers are given the opportunity to relieve an experienced manager’s of his or her job and act as his or her substitute during the period. This level also described permanent assistant to position as well as temporary opportunities to assists managers in completing their jobs.
Job rotation: job rotation can be either horizontal or vertical. Vertical rotation is nothing more than promoting a worker into a new position. On the other hand horizontal dimension of job rotation or what may be better understood as lateral transfer.
Committee Assignments: Assignment to a committee can provide an opportunity for the employee to share in managerial decision making, to learn by watching others, and to investigate specific organizational problems.
Off-the-job Development: There are wealth of employee development techniques that personal can partake in off the job. We will briefly discuss four of the more popular ones. They are as follow:
Sensitivity training in “encounter groups” became quite popular during the 1950s as a method of changing behavior through group process. Often referred to as laboratory training. It influences the participants through unstructured group interaction. Member are brought together in a free and open environment in which participants discuss themselves and their interactive process, loosely facilitated by a professional behavioral scientist. This professional then creates the opportunity to express their ideas, beliefs, and attitudes.
Transactional Analysis is both an approach for defining and analyzing communication interaction between people and a theory of personality. The fundamental theory underlying TA holds that an individual’s personality consists of there ego state-the parent, the child, and the adult. These labels have nothing to do with age, but rather with aspects of the ego.
Lecture Courses. Formal lecture courses offer an opportunity for managers or potential managers to acquire knowledge and develop their conceptual and analytical abilities. In large organizations, these lecture courses may be offered “in-house” by the organization itself and supported by out side college course work. Small organization will utilize courses offered in development programs at universities and collages, and through consulting organizations. Often college and university faculty are willing to provide specific courses to deal with the unique needs of an organization.
Simulation Exercises. Simulations were introduced as a training technique. They are probably even more popular for management development. The more widely used simulation exercises include case study. Decision games and role plays.
Approaches to TNA
Now that we have examined the general approach of conducting a TNA, let’s examine the two approaches (proactive and reactive) more specifically.
The proactive TNA focuses on future human resource requirements. As Chapter 2 described, HR function need to be involved in the development of a strategic plan (AWOT analysis). From the resulting unit objectives, HR must develop unit strategies and tactics (see Figure 2-1 on page 32) to be sure the organization has employees with the required KSAs in each of the critical jobs based on future KSA requirements. Two approaches can be taken to develop needed KSAs:
- Prepare employees for promotions/transfers to different jobs.
- Prepare employees for changes in their current jobs.
The reactive TNA begins with an existing discrepancy in job performance. In this sense, figure 4-1 represents a more complete picture of the reactive process. A middle manager may notice that productions dropping, a supervisor may see that a particular employee’s performance declined, or human resources may not increase in grievance from a particular department. One you identify a discrepancy, you need to determine whether it is worth fixing. Although this decision may be based on financial implications, it does dot have to be. For example, the company notes that one department has lower ratings of supervisory consideration (as rated by subordinates) than the organization expected. The cost of this lower rating would be difficult to assess. It may take a long time (if ever) to notice any significant impact on the company’s bottom line. If the company makes a strong commitment to developing a good employee-management relationship, it may decide to try to alleviate the problem.
Training managers can come up with a surprising number of reasons for not evaluating training such as:
- Nothing to evaluate
- No one really cares about it
- Evaluation is a threat to my job
1) NOTHING TO EVALUATE
For some companies training is a luxury the is provide as a reward for good performance, or simply something mandated so everyone must take their turn. Argument here is that training isn’t expected to accomplish anything, so there is nothing to evaluate.
2) NO ONE REALLY CARES ABOUT EVALUATING TRAINING
The most common rationale for not conducting training evaluations is that formal evaluation procedures are too expensive and time –consuming and no one really cares anyway.” This explanation usually means that no one specifically asked for, demanded, or otherwise indicated a need for assessments.
3) EVALUATION IS A THREAT TO JOB
If time and money are spent on training and an evaluation determines that no learning occurred-or worse, job performance declined-tough question will be asked. Although most managers are not likely to admit this concern publicly, it is perhaps the real problem. When we use the team evaluation, we too often think of a single final outcome at a particular point that represents success or failure –like a report card. This type of evaluation is called summative or out come evaluation.
EVALUATING THE COSTS OF TRAINING
The outcomes of training are only half the battle in evaluating its effectiveness. The other half is determining whether the results were worth the cost. If grievances do go down, and if the new behavior are exhibited and the skills learned, then training might be considered the cause of the reduction, although cause-and –effect relationships are never a sure thing. The examination of all four levels of evaluation provides evidence of case and effect, and appropriate designs enhance the level of confidence in cause and effect, but not to an absolute certainty. Many managers today still might ask, “so what? In other words, did the benefits related to the reduction in grievance outweigh?
Question can be answered two ways:
A cost/benefit evaluation of training compares the momentary cost of training to the momentary benefits. It is difficult to place a value on theses benefits, which include attitudes and working relationships. So the labor peace brought about by the reduction in grievances is difficult to assess but rates high in value in comparison to the cost of training.
A cost – effectiveness evaluation compares the monetary costs of training to the financial benefits accrued from training. Two approaches can be used to assess cost effectiveness:
- Calculation of the actual cost saving based on the change in result.
- Utility analysis, which examines the value of overall improvement in performance of the trained employees.
From the answer of questionnaires all date are followed (from appendix):
Total number of employees of One Bank ltd.
|Types of employees||Number of employees|
|Others Staff Group||500|
Size of the HR department.
|Types of employees||Number of employees|
|Others Staff Group||12|
Total number of employees of BRAC Bank ltd.
|Types of employees||Number of employees|
|Others Staff Group||1500|