Human Resource Practices At Hbl Commerce Essay

Human Resource Practices At Hbl Commerce EssayHabib camber especial(a) (HBL) commenced its operations in the social class 1947. It has the privilege of being the commencement ceremony bank to establish itself in Pakistan by and by independence. From there on, the bank has interpreted leaps and bounds and has shown tremendous proveth in the field of banking. It has now because the colossalst backstage domain bank in Pakistan. It has customer base of around fiver million people. HBL has around 1705 ramifyes across the countries.HBL alike has worldwide presence in around 26 countries. The bank has subsidiaries in Hong Kong and United Kingdom, it has affiliates in Nepal, Nigeria, Kenya, and Kyrgyzstan. HBL as well has representative offices in China, and Iran. The vast international interlocking reachs HBL the largest home(prenominal) multinational. such contactments strengthen the position of the bank not exclusively in the domestic securities sedulousness but o verly brighten the image of the bank in the international market. The guild is now planning to expand its operations in UAE, UK, S revealh and Central Asia, Africa, and the Far East. HBL has 55 branches worldwide.The commodities offered by HBL involve harvesting offerings and services in Retail and Consumer edgeing. The bank has the honor of holding the largest corporal chamfering portfolio in Pakistan with an brisk Investment cashboxing arm. Sm in all Medium Enterprise (SME) and sylvan lending programs and other banking services be made avail adequate to(p) to customers residing in urban and rural atomic number 18as.The participation leads the market by holding a domestic market sh atomic number 18 of 40 pct. HBL continues to dominate the domestic banking sphere of influence with a major sh ar-holding in foreign remittances and loans to SMEs, traders, and farmers.HBL is currently rated AAA (Long consideration) and A-1+ (Short barrier) with perpetual outlook and has a balance sheet size of USD 13.82 billion. It is the first Pakistani bank to raise Tier II Capital from external sources. (Habib commit limit, 2012)HBL has always led the market with example of quality implementation and scanty ordinary treatment with the clients. It has adapted with the changing judgment of convictions and evolved its practices as comfortably for the bet end pointent of the connection. The company has its headquarters in Habib affirm Plaza, Karachi.Company account ascendanceHBL was founded by late Mr. Ismail Habib on 25th August, 1942 at Bombay. At that time it was the first Islamic bank to be formal in the Indian Sub-continent. It was initiated with a capital of Rs 2.5 Million with a mere 12 branch ne twainrk. (Ayaz, 2011)Prior to Pakistans independence, Quaid-e-Azam during his campaigns realized the importance of a bank that was going to run to the ask of the Muslims residing in Hindustan. He requested the Habib family to establish a commercial me ssage bank. Habib Bank Limited was thus weed in 1941. The head office was laid in Bombay (now Mumbai). The fixed capital was 25,000 rupees. The bank played a brisk role in utilizing the funds from the Muslim comm unanimity to finance The All-Indian Muslim League for the establishment of Pakistan. HBL in like manner assistanted the refugees who were hurt in the communal riots and personnel that preceded the departure of British.After independence HBL duty perioded its headquarters to Karachi. Habib Bank Limiteds first international branch was setup in Colombo, Sri Lanka, in 1951. The bank started its international from this year and never looked back later on that. In 1975, the company built the Habib Bank Limited building in Karachi to celebrate its 25th anniversary. (Habib Bank Lmited, 2012)The company was nationalized in Zia-ul-Haqs era. Prior to nationalization, HBL had a domestic market sh ar of active 40 percent. After nationalization HBL continued to dominate the mar ket and held a major sh be in inward foreign remittances (55percent) and loans to small industries. The company expanded its international boundaries and c e actuallywhereed USA, Singapore, Oman, Belgium, Seychelles, Maldives, and the Netherlands. (Habib Bank Lmited, 2012)A decade subsequently nationalization, HBLs annual profit was much than than twice the combined profit of all the other commercial banks operating in Pakistan at that time which include United Bank Limited, National Bank of Pakistan, Allied Bank limited and Muslim Commercial Bank. HBL had been a source of rapid economic knowledge in the state since its establishment. It financed various goernment transport schemes, agricultural schemes and leases over the eld and sticked the largest and 1 of the most profitable political relation entities till its privatization. (Ayaz, 2011)It is intendd that HBL presented a blank cheque to Muhammad Ali Jinnah at the time of birth of Pakistan. The bank also looked over t he initial financial matters of the state by assuming the status of the state treasury till the state bank came into existence. HBL therefore had been truly close to the government of Pakistan since it was established due to these significant reasons.Vision enabling people to advance with confidence and success(Habib Bank Limited, 2012)Habib Bank Limited wishes to observe its customers excel in their lives with confidence. The passel of HBL is goated towards the domestic market and digestes on fulfilling their need and requirements in pitch to give them mirth, confidence, and the comfort they deserve. consort to Rieches, 2012 the imaging statement of a coporation provides a platform to inform adapted personnel, create strategic alliances, and most importantly loyal customers. It is really a ikon of desired destination. The destination that the corporation wishes to arrive at. It is a long term long finale established by a corporation which reflects where the it wishes to see itself in the future.HBL vision statement is not a very warm vision statement. It does not clearly go under where the company wishes to itself in the future. The vision statements be usually one fol depressive disorderrs and at bottom this limitation the long term goal is defined. HBL however has failed to do so. From the vision statement the readers are not able to gauge astir(predicate) the future plans of the company and what it wants for itself. It does talk about its customers and their benefit. Customers is just one very small part of it. The corporate goal is the most significant thing to be invokeed in the vision statement.The focus of the company calm down remains on its customers. The vision to help the customers grow is in the right steerion but the other s stick holders are being ignored. That however is not a in force(p) outline. It does not credit its touchholders, future plans, furture expansions etcetera It also does not mention whether the com pany wants to remain the market leader or not.There is immense competition in the topical anesthetic market and it is no longer easy to survive in this fierce competition without having a crystal clear vision. The vision statement of the company is a weak statement and does nor portray or cause the future plans of the Bank. The statement leads to a dowery of questions and it has a hole of ambiguities. bootTo score our customers prosper, our staff excel and create set for packetholders(Habib Bank Limited, 2012)The legation of HBL discusses its customers, employees, and the pctholders. The statement mentions three of the most important dimensions of the company. The main aim of a flush statement it to out pedigree the suddenly or medium term goals of an organization so that the employees can make strategies gibely. rush statements are assumption an enormous importance by the strategists. They consider it to be a contemplation of how company is being lived and which dire ction it intends to take on. It is said to explain the mettle purpose of companys existence. noted names in the field of strategic forethought consider legation statements to be a corner stone of an organization, and conceptualise that a well thought out electric charge statements tells a lot about an organization (Wheelen Hunger, 2010). They identify nine important components of a mission statement. Though all of these might not be include, or be necessary, but their presence in the mission statement does make the mission statement powerful and gives it ability to make an impact a well. These components include customer, products and services, markets, technology, concern of survival, produce profitability, philosophy, self-concept, concern of public image and concern of employees (Adam, 2009). The tec has utilize these nine components as guideline to analyze the existing mission statement of Habib Bank Limited.HBL mentions the first component, its customers first. It put s the customers and their betterment as a fall priority. That is a very sound administration. The bank is operation in a competitive market and if it does not follow a consumer centric set out then it is plausibly to experience downfall in its popularity. Therefore placing the customers as the first and foremost priority is a good strategy that is used by the company. The company indirectly promises to move for the success of its customers and make them booming in their liveness.There is another important dimension covered in the mission statement, the employees of the bank. The employees play a vital role in establishing the company in the market and eventually qualification it a leader. The mission statement of HBL talks about its employees and providing them with opportunities which would help them excel in their railway careers. This is a good strategy again. If a company is taking care of its employees it is very likely that the employees are going to work with loyalty for the betterment of the company.It mentions its customer, but to a greater extent clarification would have been ideal. Its products and services are not clear at all, whereas other components of a powerful mission statement including markets, technology, concern of survival, growth and profitability, philosophy, self-concept, concern of public image and concern of employees is totally missing. Therefore this is a weak mission statement, which could be repaird by incorporating these components in to it. Mission statements are often a little more elaborative, than the one downstairs consideration, which conveys a much clearer picture of the organizations mission, purpose and objectives to its stakeholders.Habib Bank Limited should improve its mission statement. Make the component mentions in it more clear and make it more useful for its stakeholders.ValuesOur values are the fundamental principles that define our culture and arebrought to life in our attitudes and behaviour. It is our values that makeus unusual and unmistakable.(Habib Bank Limited, 2012)Value of a company describes the traits and qualities that shape passing(a) actions with the internal community, customers, and suppliers. These values shape corporate culture when they dumbfound deep held driving forces and high priorities. (Rieches, 2012)ExcellenceThis is at the core of every(prenominal)thing we do. The markets in which we operate are becoming increasingly competitive, giving our customers an abundance of choice. Only through and through being the very best in terms of the service we offer, our products and exposit can we hope to be successful and grow. (Habib Bank Limited, 2012)IntegrityWe are the leading bank in Pakistan and our success depends upon our trust. Our customers and society in ecumenic expect us to possess and steadfastly adhere to high object lesson principles and professional standards. (Habib Bank Limited, 2012)Customer FocusWe understand fully the necessarily of our customers and adapt our products and services to meet these. We always strive to put the satisfaction of our customers first. (Habib Bank Limited, 2012)MeritocracyWe believe in giving opportunities and advantages to our employees on the stern of their ability. We believe in rewarding achievement and in providing first-class career opportunities for all. (Habib Bank Limited, 2012)ProgressivenessWe believe in the advancement of the society through the adoption of the enlightened working practices, innovative invigorated products and processes, and a spirit of enterprise. (Habib Bank Limited, 2012)Operational StructureHBL is one of the largest commercial bank of Pakistan. It accounts for a square share (20percent) of the total commercial banking market in Pakistan with a ne 2rk of 1,705domestic branches 55 overseas branches in 26 countries spread over Europe, the substance East, Far East, Asia, Africa and the United States. (Ismail, 2009)HBL wholly owned Subsidiaries that is to say Habib Bank monetary Services (PVT) LTD. Karachi, Habib Finance International Ltd. (Hong Kong) and Habib Finance Australia Ltd. Sydney two Joint Ventures namely Habib Nigeria Bank Ltd. (40%) and Himalayan Bank Ltd. (20%).Habib Bank Limited also has two representative offices in Iran and Egypt.(Ismail, 2009)Organization StructureOrganization structure defines how caper tasks are formally divided, grouped, and coordinated. There are six key elements that managers need to address work specialization, partalization, chain of command, span of control, centralization, decentralization, and formalization. (Robbins, Judge , Sanghi, 2010)Chairman death chairBoard of Directors elderly Vice hot seatSenior Vice hot seat(Finance Audit)Senior Vice President(Asset Remedial)Senior Vice President(Corporate Banking)Senior Vice President(Corporate Banking, Financial Institute, Project Finance)Senior Vice President(Credit Policy)Senior Vice President(Retail Banking)Decision MakingThe decision making process at HBL is centralise. All the decisions are taken at the pilfer level of the management without any consultation with the lower levels of the hierarchy. According to Famous names in the field of organization behavior define centralized decision making of being concentrated at a individual(a) point in the organization. (Robbins, Judge , Sanghi, 2010) The lower-level managers simply have to carry out the top managements directives. A centralized structure reflects a more fuddled and strict culture at the organization. It is not considered to be a very responsive structure.Chain of CommandThe chain of command is an un rugged line of authority that extends from the top of the organization to the lowest echelon and clarifies who reports to whom. (Robbins, Judge , Sanghi, 2010) Chain of command identifies which employee is to report to whom. In HBL chain of command is clear and every employee knows their direct supervisor and to whom he can report. The comp any is using a unity of command chain of command. This particular type bounds the concept of unbroken line safe and ensures that the employee has one supervisor only to whom the employee is to report. If the unity of command gets broken then the employee might have to respond to the demands of two or more supervisors.Organizational StrategiesThere are primarily two main types of strategies adopt by the tender imaging part of an organization. In an interview with the pursuit are the two main strategies followed by the Human Resource department of Habib Bank LimitedCorporate StrategyHBL focus on two types of corporate strategiesGeographic ExpansionIn this new era of twenty-first century it would not be wrong to call the world a global village. With the introduction of revolutionary technology the ends of the world are able to communicate with just a click. HBL is trying to capture divers(prenominal) international markets by geographically expanding its operations.Diversification In todays competitive world only those companies are able to survive who are the fittest. The key is to either target a particular untapped market or target the needs of some(prenominal) variant segments. The latter strategy ensures a wider coverage of the market and as a moderate increases the market share. HBL is interest diversification strategy to tap different segments in the market which possess different needs. HBL introduces different services in intervals to entertain the needs of its modify customer line. clientele Unit StrategiesFollowing are the business unit strategies for Habib Bank LimitedCost LeadershipThe cost leadership strategy allows the firm to rear a competitive advantage in the market by holding the costs as low as possible. The company is able to achieve cost leadership through efficient and effective production system. HBL follows this strategy by providing services to customers at costs lowers than the competitors.DifferentiationDifferentiation accor ding to Micheal Porter is highlighting the distinctive competencies in a firm which would make the firm stand out from its competitors. HBL is following this strategy to provide unique services to its customer in the banking diligence.Human Resource DepartmentAccording to (Dessler Varkkey, 2012) Human resource is the process of acquiring, instruct, appraising, and compensating employees, and of attending to their labor relations, health and safety, and wanness concerns The human resource department of HBL tries to make out the same duties as mention by Dessler Varkkey. The department plays a significant role in creating value for the bank. HBL has a very efficient and active human resource department. It consists of competent employees who formulate strategies according to the local and global needs of the manufacture and employees. The department also skillfully tackles different problems related to the HR department. The department plays an active role in making the bank mo re successful every day.Over the years, HBL has adopted customer oriented approach in the late(a) years due to the changing market dynamics. In order to leave to the needs of these customers, the employees of HBL play a vital role. Therefore, in order to keep the employees happy and satisfied with their work, the HR department tries to take care of their needs and requirements in timely fashion. The department takes care of the companys asset the employees and hopes that the asset would founder the company back with full interest.Human Resource StrategiesThe Human resource department of Habib Bank Limited has six main strategiesWorkflowsIn order to maximize the profits, HBL has planned a mix of long term and short term goals. These goals are designed in a manner that they would help HBL achieve a competitive edge over its competitors. The following measures are considered for this regardRisk focusUnified learning Technology corpseIntensive Training and Professional Recruitment Re-organization of the Consumer and Retail Banking BusinessInformation Technology system enhancementProduct offering enhancement furtherance of Operations in urban areasRecruitment and StaffingEmployment planning is where the recruitment and selection process commences at HBL. This process starts with the forecasting and planning of human resource compulsory for the current and future positions. The process of selection and recruitment process is carried out tactfully and all the dimensions of the candidate are canvas carefully. Future prospects are also identified while hiring the candidate. Skills, personality, attitude, knowledge are some of the aspects of the candidate which are judged carefully during the recruitment process.Vacant PositionRecruitment sourForecasting of PositionsIdentify Pool of CandidatesDevelop pool of candidatesMonitoring, Tailoring growingScreening / Short ListingFinal creamRecruitment and Selection point of reference (Shahid, 2012)Employee Separati onsHBL has started a program which offers voluntary retirement schemes to employees. The employees get a golden shingle in return. The new term for golden handshake is Voluntary Separation Scheme (VSS). This scheme offers a special incentive to the employees who opt for the scheme and provides them a lump sum amount which equals to the stipend of twelve months. Employees who work with the bank for a decade or more are entitled to the pension plan. This plan is going to help the employees in a manner that they will have no financial obligations after they have retired.Performance AppraisalEvaluating an employees current and past carrying into action carnal knowledge to its movement standards is called performance estimation. A process that consolidates goal settings, performance appraisal and go againstment into a single common system to ensure that employees performance is according to companys aims is called performance management. Ratings as practiced in HBL consist of fol lowing five kinds of factors. The following factors are put into consideration while reviewing the performance of an employee and making an appraisalProductivityAttributesTechnologyCustomer Service own(prenominal)TrainingAccording to (Dessler, A Framework for Human Resource Management, 2011), training refers to the methods employers use to give new or present employees the skills they need to perform their jobs.HBL follows the follows a four step following process. The training process is as followsNeeds digestIdentify job performance skills needed, assesses skills of prospective trainees and develop objectives.Instructional DesignProduce the training program content, including workbooks, exercises, and activities.ImplementationIn this step the process gives an opportunity to the trainees to experience situations close to practical life. valuationIn this step the success or failure of the program is assessed.Source (Shahid, 2012)Training and Development ProgramsHBL uses the followi ng practices for training and development of its employeesManagement TraineeManagement Trainee Officer (MTO) program looks for highly motivated candidates who exhibit the potential to become future leaders. At HBL, the MTO program offers extensive interactive classroom training, on the job rotations and personal mentoring from senior management to provide a statewide learning experience.Management AssociateManagement Associate Program at HBL is a training and rotational program. The program particularly focuses on handling the branch banking requirements. It also provides numerous opportunities across HBLs network of Retail, Corporate, and Commercial Banking. property officersCandidates in this program are the bank ambassadors. Therefore they are required to have exemplary skills when interacting with the clients. The program involves an extensive one-month training period establish on branch banking operations before placement in one of the branches.Types of ProcessesOn the pare ntage TrainingIt is when the new employee learns about the job by actually doing it. Methods of on the job training are as follows jumpJob rotationSpecial assignmentsAction learningUnderstudyIt is also known as coaching. Under this method the employee is placed under the superintendence of a professional employed at the organization. The professional provides guidance to the new employee. At HBL, the trainee works under the supervision of a senior manager. The trainee whitethorn also work with the employee to be replaced. It takes place at all the levels of the job. refreshful and old, both the types of employees are trained with the help of this method.Job RotationJob rotation is when an employee is moved from one department to another to not only broaden the skills of the employees but also to analyze the strong and weak points of the employee. HBLs manager associate program makes use of this type of training.Special AssignmentsSpecial assignments are given to the employee by th e supervisor. These are assignments or tasks to be done within the premises of the branch. Based on the way the task is completed the supervisor analyzed the performance of the employee.Action learningThis method is only to be used for the employees based at the managerial level. Under this method, the employees are to work full time in one department. The employees are assigned to take care of the problems which arise and provide relevant solutions for the problems.CompensationThe salaries, rewards, bonuses, and incentives on the basis of job and performances are called compensations. HBLs compensation and benefits strategy combines the need to maintain a high performance culture along with market competitiveness. According to performance each employ gets benefits and compensation. Tenure duration is less preferred as compared to the performance of employees. Employees are paid in two formsDirect PaymentsThese are the payment in the form of wages, salaries, incentives, commissions, and bonuses.Indirect PaymentsThis mode of payment includes the benefits and perks that are given to the employees for example medical, car, insurance, residence, car fuel, easy loans etc. pains AnalysisThe Banking orbit is an integral part of the provinces financial services industry. The banking sector go through growth in 2001 03. During this tenure the alluviations rose almost by a 100 percent. The competition is high in the industry with the presence of local and foreign banks.Almost a decade ago, opportunities for foreign banks, especially in consumer and retail banking, were greaterthan ever before. In the financial year of 2004-05, the banking sector experienced growth rates of 21% and 36% in its deposit and advances portfolio respectively. This helped improve the stability of the banking sector as compared to 2003 04. (Pakistan Banking Sector, 2009)A significant shift of focus from industrial lending to consumer products has allowed the banks to enjoy enormous spreads . However, the manufacturing sector is still enjoying the highest share in credit facilities extended by the banking industry (Pakistan Banking Sector, 2009). initially the banking sector was only catering to the needs of big corporations and the government. However after the reforms the sector is now entertaining the middle class as well.The industry was passing through a transitional period from long established patterns and norms to the unknown land of threats and opportunities. The following are the few areas in the banking industry which have witnessed change over the yearsDiversity within the commercial banking industryThe following segments have experienced change in the few years operations, market focus, advertising, and use of information technology. The banks are now concentrating more on developing and establishing distinctive image as compared to their competitors. The banks are doing this by introducing unique products in the market.Intensifying CompetitionThe competit ion in the banking industry has deepened over the years. It has become fierce over the years. There are a few factors who have contributed to the increasing competition. Increased consumer awareness about the different products and services being offered by the banks has increased the competition. The banks in such a situation can no more enjoy saving the deposits of the consumers at lower rates. Such situations may actually force the banks to lend their specie to customers which might have a high risk.Profit trendsThe ratios indicate a growth in the market. There have been a few dips in the market but overall the industry has seen an upward trend over the years.Soaring Loan LossesTroubled loans are regarded as a cancer for this industry. The quality loans are the ultimate goal for bankers in the twenty-first century.MergersMergers have taken their toll in this country. Over the years the country has witnessed many mergers for example Union Bank with Standard Chartered etc. The pur pose is to hold on to as much market share as possible and to tame the increasing competition. however there are some setbacks as well for example, the economies of scale after a true level of expansion no longer exist for the merger.Structure of the Banking IndustryPakistan being a developing country has a relatively low level of income. The required growth rate as a result is also low because of low savings. The standard of living and quality of life are terms still stranger to the people of this country. The foreign aid have been the bridging gap for us between our savings and investments. Nevertheless these help have become the drowning forces for our country. IMFs main objective for Pakistan is to maintain stable tack rates, multi-lateral credit system and international liquidity in order to reanimate from its worst economic crisis. (Pakistan Banking Sector, 2009)Structure of the Pakistani banking sector has substantially changed in the last decade,particularly following t he privatization of the state-owned banks. In 1990, the banking system was dominated by five commercial banks which were all state-owned. The 1990 amendments to the Banking Companies Ordinance launched the process offinancial sector reforms by allowing privatization of the state-owned banks. During the first round of reform, two of the state-owned banks, Muslim Commercial Bank(MCB) and Allied Bank (ABL), were privatized between 1991 and 1993. The reformsprocess was subsequently delayed for several years and resumed significantly only in the early 2000s. With the privatization of the third large bank, United Bank (UBL), in2002, the domination of the state-owned banks was ended. As of September 2003, the asset share of local private banks and public sector commercial banks was 47 percent and 41 percent respectively. Another large state-owned bank, Habib Bank (HBL), completed its privatization n process in February 2004. As a result of this privatization, the share of banking system as sets held by public sectorcommercial banks decreased to less than 25 percent. The largest bank in the country,National Bank of Pakistan (NBP), with a market share of approximately 20 percent, remains state-owned and its privatization prospects are uncertain at this stage, although the government divested approximately 25 percent of its capital in 2001-03.A lot of endeavor has been put in the sector in recent years to promote Islamic banking in Pakistan. Numerous conventional banks have also opened up their branches to provide financial services to the consumers.Lately, the banking sector has diversified its product base and carried out a lot of innovation. They have included different customers like the agriculture sector, SMEs, mortgage financing and consumer financing in their customer list. Not only that this diversified lendingportfolio mitigates risks but it also raises the purchasing power of a large segment ofpopulation that was altogether shut out from credit markets. Pakis tans auto industry has expanded its car production by a multiple of five times in the last fouryears as auto finan