Strategic Planning and Management of Human Resource

The human resource management (HRM) department has frequently been disregarded in a number of corporate businesses, including the banking sectors (Rees and Smith, 2017). Banks have decided to firmly include HRM managers in their senior management teams, though, as a result of recent research studies to assess the value of the HR department in the business sector. This decision was made because these divisions are essential to a company's ability to grow and compete in the marketplace. The banking sector in the world today has grown tremendously from being small deposit acceptance institutions into bigger and more complex multiplayer markets in which financial institutions, specialized banks, and larger commercial banks can operate (Rees and Smith, 2017).

Banking itself has turned to be a complex activity embedded in the financial markets and is linked either directly or indirectly with the cumulative national growth. Similar to any other organized business sectors, banking also needs multi layer human capital to achieve its various requirements both of the experts and the support staff, for example, a highly trained pool of professionals to plausibly educated security personnel (Rees and Smith, 2017). Since the banking sector has realized the need to liberalize activities, banks have resorted to becoming market-based and oriented business as a way of expanding their reach to customers’ doors hence making banking as an activity to be more practical. As a result of this, banks require appropriate personnel to run them efficiently. To source for the personnel, in the past banks had handled this exercise through various departments such that HRM was being handled just like any other physical object within the departments of the banks (Rees and Smith, 2017).

For example, the personnel departments in the banks were responsible for exercises like; disciplining the staff, approving leave, terminating the services of an employee, and handling of staff loans among others. Other important functions conducted by the HRM department today were similarly carried out by the personnel departments for example recruitment and hiring of staffs which they did more casually without considering the educational and professional background regardless of their real worth in the banking institutions (Rees and Smith, 2017).

It has to be categorically recognized that the success narration of the big banking sectors today relies immensely on the fact that the HRM has been made an independent department. As the workforce in the banking institutions become more diverse and even expanded, the HRM department has a responsibility of ensuring they take part actively and strategically in the recruiting, hiring, and retaining the best employees of the institution. As a function of the HR department, the first role after the announcement of vacancies or the available opportunities is to conduct a pre-employment screening (Garavan, Shanahan, Carbery, and Watson, 2016). Banking institutions want employees with specific qualifications and competencies therefore as a strategic role of the HR department it has to ensure that only those applicants who meet the preliminary requirements for education, experience, and capabilities are shortlisted for interviews (Garavan, Shanahan, Carbery, and Watson, 2016). If this process is carried out efficiently, it helps in eradicating the large number unqualified applicants without going through the process of interviews. Additionally, carrying out screening can also help the HR department to identify in good time the likely applicants that they can engage in their employment (Garavan, Shanahan, Carbery, and Watson, 2016).

Although curriculum vitae of applicants can show the experience they possess, screening is equally important since it gives the employer the opportunity to understand the applicant’s work ethics, competence, and personality. Research has shown that proper pre-employment screening is an efficient process which not only makes the process less time to consume and manageable but also produces employees as Garavan, Shanahan, Carbery, and Watson (2016) describe, with 18% greater productivity and 51% lower turnover. The quality screening process is mandatory requirement for the HR department to ensure the success of the banking institutions.

To ensure this is achieved, there are a number of considerations which have to be made and according to Garavan, Shanahan, Carbery, and Watson (2016) they include; the resume being reviewed should be 100% accurate with all the key details included in it, conducting thorough screening by validating the applicants’ qualifications for the positions they applied for, and understanding that the screening stage is the key to the bank’s success because it is at this stage that the employers can get the first impressions of the potential employees. Considering the hiring process, the employer, in this case, the banking institutions, understand that the employees are as good as the business itself and therefore an integral part of the corporation (Garavan, Shanahan, Carbery, and Watson, 2016). The HR department should thus be committed to hiring only those employees who are committed to the job and are ready to take up the duties delegated. The banking institutions understand that skill is just one factor that is considered while hiring an employee. Higher employee turnover is a derailing factor which can cost the banks time and money while sourcing for, interviewing, and training new employees.

Reports indicate that when an experienced employee is replaced, it can cost the employer 50% of more of the individual’s salary per year to as turn-over related expenditures as had earlier been mentioned (Garavan, Shanahan, Carbery, and Watson, 2016). Sometimes this cost can go higher especially for the more diverse and extensive experience jobs. With regards to the discussion above, the banks’ HR department should ensure that when hiring the employees, the following are considered; attitude, communication skills, creativity, integrity, and personality (Garavan, Shanahan, Carbery, and Watson, 2016). The banking institutions must recognize that employees are the most valuable resources and stakeholders upon which their success relies. As a strategic plan to even cut costs within the institutions, the HR department has to take time and hire the right and stronger team.

Recent studies in the field of Human Resource Management have shown some worrying statistics about the number of employees who have intentions of quitting their jobs for example in the next six months. For instance, a study showed that close to 40% of employees in the banking sector are considering looking for another job whereas about 69% reported that they have already started looking for alternative jobs although they are still in their current (Nolan and Garavan, 2016). The research findings may not be so pleasing to most HR departments who are determined to retain their employees. The employers, therefore, need to give the employees the best reason to continue working for them and this can be achieved only through building cultures that enhance strong relationships between the ban king institutions and their employees.

There are five R’s which the banks can employ to ensure employee retention does not become a nightmare to their operations. These include; revenue-sharing, responsibilities, respect, relaxation time, and reward (Nolan and Garavan, 2016). From these factors, it is recognizable that employee retention requires effort from the employers. Long-term commitment thus is a product of understanding, appreciation, and empowerment from the employer. The above-discussed processes of the HR department form its goals which together are aimed to help the banking institutions achieve their successes. In a broader dimension, these three roles which are played by the HR department translate into the following goals; boosting performance morale of the employees, developing leaders, designing performance incentives, enhancing accountability, increasing efficiency and productivity, enhancing effective recruitment and staffing, and enhancing organizational learning (Nolan and Garavan, 2016). As already discussed, the success of the banking institutions fully relies on the kind of employees it has and who are directly under the authority of the HR department.

Therefore, whenever the HR department sets its goals, they must be inclusive in such a way that ultimately they contribute to the success of the entire institutions and not just departmental prosperity. For example, employees who are motivated through good salaries, promotions, and through other incentives have a low probability of exhibiting turnover traits, and this is to the benefit of the business (Nolan and Garavan, 2016). Similarly, effective recruitment and staffing as a goal of the HR department will ensure only the right and qualified employees are hired who will eventually increase the productivity hence profitability of the banking institutions. To ensure implementation of the stated HR department goals, there must be a strong interaction or relationship between the top management and the employees (Nolan and Garavan, 2016). In many occasions, the HR department has played a strategic role as the link between the employees and their employers.

However, these interactions have been boosted by the introduction of systems that facilitate direct dealings between the employees and their employer (Nolan and Garavan, 2016). Several research studies agree that the HR has the most vital corporate functions but in many occasions perform poorly thereby failing to meet the needs of both the employees and the expectations of the corporation, in this case, the banking institutions. Within the HR department of most businesses, there are competing expert functions. To boost the relationship between the employees and the management, therefore, there must be devolution of various functions such that employees can get more refined and intensive address whenever they need (Nolan and Garavan, 2016). The HR attains its powers from the capacity to be an intermediary between the employees and the executive. It is therefore indispensable to form networks both within and between institutions. As earlier stated, employees are an important part of the business that cannot be ignored when making corporate decisions. Therefore, to implement the goals set by the HR, there must be proper consultations between the HR, employees and the executive (Nolan and Garavan, 2016). For these consultations to be facilitated to reach a common ground, the HR must play the role of linking the workforce and the management to achieve inclusivity.

In the current economy, organizations are suffering from major setbacks such as organizational layout shifts, budget cuts, and layoffs and all of them contribute directly to the monstrous happenings in the HR departments (Garavan, Shanahan, Carbery, and Watson, 2016). These happenings include; low employee retention rates, noncompliance with the legislations, negligence of policies, and increased employee law-suits. As a result, the human resource managers have become so aggressive with the HR Assessments otherwise termed as HR Audits to determine their levels of success (Garavan, Shanahan, Carbery, and Watson, 2016). Although mostly third party experts are contracted to carry out this process, the embracement of technology has made it possible for banks to conduct self-assessment.

There are two broad areas where banks focus primarily when conducting assessments and these are with regards to; legal compliance and the analysis of the company’s best practices (Garavan, Shanahan, Carbery, and Watson, 2016). Processes including on-boarding, procedures of discipline, payroll system, hiring, and performance management must be reviewed. After that, the concise and detailed report must be written to give detailed information about the successful and unsuccessful operations of the institutions (Garavan, Shanahan, Carbery, and Watson, 2016). The benefits of HR are quite a lot, and the best asset this department has for any industry is the ability to identify weaknesses within the system and offer direction to address them.

References

Garavan, T., Shanahan, V., Carbery, R., & Watson, S. (2016). Strategic human resource development: towards a conceptual framework to understand its contribution to dynamic capabilities. Human Resource Development International, 19(4), 289-306.

Nolan, C. T., & Garavan, T. N. (2016). Human resource development in SMEs: a systematic review of the literature. International Journal of Management Reviews, 18(1), 85-107.

Rees, G., & Smith, P. (Eds.). (2017). Strategic human resource management: An international perspective. Sage.