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People Challenges in Banks- Business Manager
Human Resources » Organization Development

Chrm Message From: anil kaushik Total Posts: 78 Join Date: 19/03/2006
Rank: Manager Post Date: 30/11/2012 18:52:45 Points: 390 Location: India

 Dear Friends,

 After exposed to deregulated environment Indian banking sector specifically public sector banks which account for around 70% of the industry have not taken required initiatives to meet the challenges on HR front. Though of late PSBs have adopted operations through technology but the gap in skill & mind set of people is substantial. Archaic systems,processes,unwieldly organization structure and forty plus age staff with poor marketing and new technology skills and a highly regulated HR system continues to dominate. In contrast  new age banks be it private or foreign entered the market with new technology, younger and talented people, with new set of skills and competencies and market based compensation structure with lean organization structure  gave them one up over PSBs.
 The quality of human asset in banking sector is the present problem. The right kind of technology is not sufficient-rather an attractive organizational climate with right people competencies have become more critical. Value of intangibles like trust, confidence and behavior of front line employees in the bank has a greater role to play.
Where our PSBs stand today? With around lakh of retirements on cards by 2015, Leadership vacuum and lack of HR vision may suffocate the growth and proper positioning.  It is high time for them to take the challenge of total overhaul of HR systems and processes. These banks have left with no other option but to take a call for complete HR transformation. There may be hindrances .The employees unions and factor of common wage increase throughout all PSBs without differentiating performers and non performers would be one of the most challenging tasks to handle. Unions would not like any reform to take place which would make their power of bargain or influence lesser.  But it has to be done. Ultimately it will determine employees' ability to compete.  
Khandelwal committee has done a remarkable job by presenting a HR vision to the Govt. in the shape of recommendations for HR reforms in PSBs. Now it is for the Govt. to act fast and bring HR on center stage and change the face of PSBs. Sooner the better. Slow decision making will make the situation more complex.
 When it is said that per employee cost of the PSBs is higher than that of a private bank, it can also be argued that objectives and priorities of PSBs and private banks are different in country like India. While PSBs are here to cater the needs of priority sector and act as per Govt. policies on loaning and other product design, Private sector banks carefully design product services which are only profit driven and make business sense. When we talk of the problem of growing age employees, it has to be remembered that in last two decades there have been negligible recruitments in the PSBs.
 It is also not that Private sector banks do not have any  HR challenges before them. They too are grappling with the issues like work life balance, workplace diversity and retaining talent etc.
 The issues and challenges are almost identified . Time is to act upon. The agenda for HR reforms is of tall order. The phase has come which is clearly of People challenges.
 The cover feature of Dec. 2012 issue of Business Manager Magazine talks about HR issues, challenges and possible way out in banking sector.
Anil Kaushik
Chief Editor,Business Manager-HR magazine
B-138, Ambedkar Nagar, Alwar-301001 (Raj.)

The attachment file can be viewed at Knowledge Center >> Human Resource Management >> BM Dec 2012 Highlights.pdf
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