A STUDY ON

HUMAN RESOURCE MANAGEMENT STRATEGIES

IN
[STANDARD CHARTERED BANK]

Project report submitted in partial fulfillment of the requirement of

South Asia University for the award of the degree of
MASTER OF BUSINESS ADMINISTRATION
2010

Submitted By

NAME : VIKASH GOVIND

ENROLMENT NO : SAA04M143ELBIHA3

Under the guidance of

Dr. NIRMALKUMAR.R.T M.Com.,M.B.A.,AMIBM.,Ph.D.,

SOUTH ASIA UNIVERSITY

LONDON

1
 GEMS B SCHOOL
PONDICHERRY

CERTIFICATE

This is to certify that project entitled “STUDY ON HUMAN

RESOURCE MANAGEMENT STRATEGIES IN STANDARD CHARTED
BANK“ is submitted by VIKASH GOVIND(ENROLLMENT
NO.SAAO4M143ELBIHA3)GEMS B SCHOOL, PONDICHERRY in
partial fulfillment of the first trimester Requirement in Human Resource
Management for the award of the degree Master of Business Administration and
is certified to be an original and bonafide work.

PLACE : Guide Signature

DATE

2
 ACKNOWLEDGEMENT

I am indebted to all powerful almighty God for all the blessings he showered
on me and for being with me throughout the study.
I place on record my sincere gratitude and appreciation to my project
guide for his kind co-operation and guidance which enable me to complete this
project.
I also express with great pleasure and sincerity to record my thanks, gratitude
and honour to Mr. L. Alphonse Liguori-Managing Director, Mr. M. Tamijuddin-
Director academics, Ms. Marudam-Student Relations Executive for their valuable
advice and for timely help concerning various aspects of project.

I take this opportunity to dedicate my project to our loving faculty Dr.

NIRMALKUMAR.R.T was a constant source of motivation and I express my deep
gratitude for his never ending support and encouragement during this project.
Finally I thank each and every one who helped me to complete this project.

DATE : VIKASH GOVIND

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 EXECUTIVE SUMMARY
This study aims at studying in detail Human Resource
Management Strategies in Standard Chartered Bank . It
also highlights the various aspects of design and
approaches of the human resource strategies.

Accordingly the research design was prepared

and adequate literature survey was made. Secondary data
was collected through the internet and other sources.
After the collection of secondary data analysis was made
to analysis the data. Accordingly suggestions were made
to refine more the strategies.

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CHAPTERS TITLE PAGE

ACKNOWLEDGEMENTS
3

EXECUTIVE SUMMARY
4

CHAPTER 1 INTRODUCTION TO

HUMAN RESOURCE STRATEGY

5

• NEED OF STUDY
16

• OBJECTIVES OF STUDY
17

• PERIOD OF STUDY
18

• RESEARCH METHODOLOGY
19

• LIMITATION
20

5
CHAPTER 2 CORPORATE PROFILE
21

CHAPTER 3 DESIGN AND APPROACHES

26

CHAPTER 4 STRATEGIC HRM PRACTICES IN SCB 30

CHAPTER 5 ANALYSIS
45

CHAPTER 6 CONCLUSION
54

BIBLOGRAPHY
56

CHAPTER 1
1-1 INTRODUCTION TO HUMAN RESOURCE STRATEGY
1-2 NEED OF THE STUDY

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 1-3 OBJECTIVE OF THE STUDY
1-4 PERIOD OF THE STUDY
1-5 RESEARCH METHODOLOGY
1-6 LIMITATIONS OF THE STUDY

1-1 INTRODUCTION TO HUMAN RESOURCE MANAGEMENT

STRATEGY

HRM strategy

Human resource management (HRM) is the strategic and coherent

approach to the management of an organization's most valued assets - the
people working there who individually and collectively contribute to the
achievement of the objectives of the business. The terms "human
resource management" and "human resources" (HR) have largely
replaced the term "personnel management" as a description of the
processes involved in managing people in organizations. In simple words,
HRM means employing people, developing their capacities, utilizing,
maintaining and compensating their services in tune with the job and
organizational requirement.

Features

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Its features include:

• Organizational management
• Personnel administration
• Manpower management
• Industrial management

But these traditional expressions are becoming less common for the
theoretical discipline. Sometimes even employee and industrial relations
are confusingly listed as synonyms, although these normally refer to the
relationship between management and workers and the behavior of
workers in companies.

The theoretical discipline is based primarily on the assumption that

employees are individuals with varying goals and needs, and as such
should not be thought of as basic business resources, such as trucks and
filing cabinets. The field takes a positive view of workers, assuming that
virtually all wish to contribute to the enterprise productively, and that the
main obstacles to their endeavors are lack of knowledge, insufficient
training, and failures of process.

Human Resource Management(HRM) is seen by practitioners in the field

as a more innovative view of workplace management than the traditional
approach. Its techniques force the managers of an enterprise to express
their goals with specificity so that they can be understood and undertaken
by the workforce, and to provide the resources needed for them to
successfully accomplish their assignments. As such, HRM techniques,
when properly practiced, are expressive of the goals and operating
practices of the enterprise overall. HRM is also seen by many to have a
key role in risk reduction within organisations.

Synonyms such as personnel management are often used in a more

restricted sense to describe activities that are necessary in the recruiting
of a workforce, providing its members with payroll and benefits, and
administrating their work-life needs. So if we move to actual definitions,
Torrington and Hall (1987) define personnel management as being:

“a series of activities which: first enable working people and their

employing organisations to agree about the objectives and nature of their
working relationship and, secondly, ensures that the agreement is
fulfilled" .

While Miller (1987) suggests that HRM relates to:

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".......those decisions and actions which concern the management of
employees at all levels in the business and which are related to the
implementation of strategies directed towards creating and sustaining
competitive advantage"

Academic theory

The goal of human resource management is to help an organization to

meet strategic goals by attracting, and maintaining employees and also to
manage them effectively. The key word here perhaps is "fit", i.e. a HRM
approach seeks to ensure a fit between the management of an
organisation's employees, and the overall strategic direction of the
company (Miller, 1989).

The basic premise of the academic theory of HRM is that humans are not
machines, therefore we need to have an interdisciplinary examination of
people in the workplace. Fields such as psychology, industrial relations,
industrial engineering, sociology, economics, and critical theories:
postmodernism, post-structuralism play a major role. Many colleges and
universities offer bachelor and master degrees in Human Resources
Management or in Human Resources and Industrial Relations.

One widely used scheme to describe the role of HRM, developed by

Dave Ulrich, defines 4 fields for the HRM function:

• Strategic business partner

• Change management
• Employee champion
• Administration

However, many HR functions these days struggle to get beyond the roles
of administration and employee champion, and are seen as reactive rather
than strategically proactive partners for the top management. In addition,
HR organisations also have difficulty in proving how their activities and
processes add value to the company. Only in recent years have HR
scholars and professionals focused on developing models that can
measure the value added by HR.

Business practice

Human resources management involves several processes. Together they

are supposed to achieve the above mentioned goal. These processes can
be performed in an HR department, but some tasks can also be
outsourced or performed by line-managers or other departments. When

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effectively integrated they provide significant economic benefit to the
company.

• Workforce planning
• Recruitment (sometimes separated into attraction and selection)
• Induction, Orientation and Onboarding
• Skills management
• Training and development
• Personnel administration
• Compensation in wage or salary
• Time management
• Travel management (sometimes assigned to accounting rather than
HRM)
• Payroll (sometimes assigned to accounting rather than HRM)
• Employee benefits administration
• Personnel cost planning
• Performance appraisal
• Labor relations

HRM strategy

An HRM strategy pertains to the means as to how to implement the

specific functions of HRM. An organization's HR function may possess
recruitment and selection policies, disciplinary procedures,
reward/recognition policies, an HR plan, or learning and development
policies, however all of these functional areas of HRM need to be aligned
and correlated, in order to correspond with the overall business strategy.
An HRM strategy thus is an overall plan, concerning the implementation
of specific HRM functional areas.

An HRM strategy typically consists of the following factors:

• "Best fit" and "best practice" - meaning that there is correlation

between the HRM strategy and the overall corporate strategy. As
HRM as a field seeks to manage human resources in order to
achieve properly organizational goals, an organization's HRM
strategy seeks to accomplish such management by applying a
firm's personnel needs with the goals/objectives of the
organisation. As an example, a firm selling cars could have a
corporate strategy of increasing car sales by 10% over a five year
period. Accordingly, the HRM strategy would seek to facilitate
how exactly to manage personnel in order to achieve the 10%
figure. Specific HRM functions, such as recruitment and selection,

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 reward/recognition, an HR plan, or learning and development
policies, would be tailored to achieve the corporate objectives.

• Close co-operation (at least in theory) between HR and the

top/senior management, in the development of the corporate
strategy. Theoretically, a senior HR representative should be
present when an organization's corporate objectives are devised.
This is so, since it is a firm's personnel who actually construct a
good, or provide a service. The personnel's proper management is
vital in the firm being successful, or even existing as a going
concern. Thus, HR can be seen as one of the critical departments
within the functional area of an organization.

• Continual monitoring of the strategy, via employee feedback,

surveys, etc.

The implementation of an HR strategy is not always required, and may

depend on a number of factors, namely the size of the firm, the
organizational culture within the firm or the industry that the firm
operates in and also the people in the firm.

An HRM strategy can be divided, in general, into two facets - the people
strategy and the HR functional strategy. The people strategy pertains to
the point listed in the first paragraph, namely the careful correlation of
HRM policies/actions to attain the goals laid down in the corporate
strategy. The HR functional strategy relates to the policies employed
within the HR functional area itself, regarding the management of
persons internal to it, to ensure its own departmental goals are met.

Faced with rapid change organizations need to develop a more focused

and coherent approach to managing people. In just the same way a
business requires a marketing or information technology strategy it also
requires a human resource or people strategy.

In developing such a strategy two critical questions must be addressed.

• What kinds of people do you need to manage and run your

business to meet your strategic business objectives?

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 • What people programs and initiatives must be designed and
implemented to attract, develop and retain staff to compete
effectively?

In order to answer these questions four key dimensions of an organization

must be addressed. These are:

• Culture: the beliefs, values, norms and management style of the

organization
• Organization: the structure, job roles and reporting lines of the
organization
• People: the skill levels, staff potential and management capability
• Human resources systems: the people focused mechanisms which
deliver the strategy - employee selection, communications,
training, rewards, career development, etc.

Frequently in managing the people element of their business senior

managers will only focus on one or two dimensions and neglect to deal
with the others. Typically, companies reorganize their structures to free
managers from bureaucracy and drive for more entrepreneurial flair but
then fail to adjust their training or reward systems.

When the desired entrepreneurial behavior does not emerge managers

frequently look confused at the apparent failure of the changes to deliver
results. The fact is that seldom can you focus on only one area. What is
required is a strategic perspective aimed at identifying the relationship
between all four dimensions.

If you require an organization which really values quality and service you
not only have to retrain staff, you must also review the organization,
reward, appraisal and communications systems.

The pay and reward system is a classic problem in this area. Frequently
organizations have payment systems which are designed around the
volume of output produced. If you then seek to develop a company which
emphasizes the product's quality you must change the pay systems.
Otherwise you have a contradiction between what the chief executive is
saying about quality and what your payment system is encouraging staff
to do.

There are seven steps to developing a human resource strategy and the
active involvement of senior line managers should be sought throughout
the approach.

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Steps in developing HRM strategy

Step 1: Get the 'big picture'

Understand your business strategy.

• Highlight the key driving forces of your business. What are they?
e.g. technology, distribution, competition, the markets.
• What are the implications of the driving forces for the people side
of your business?
• What is the fundamental people contribution to bottom line
business performance?

Step 2: Develop a Mission Statement or Statement of Intent

That relates to the people side of the business.

Do not be put off by negative reactions to the words or references to

idealistic statements - it is the actual process of thinking through the
issues in a formal and explicit manner that is important.

• What do your people contribute?

Step 3: Conduct a SWOT analysis of the organization

Focus on the internal strengths and weaknesses of the people side of the
business.

• Consider the current skill and capability issues.

Vigorously research the external business and market environment. High

light the opportunities and threats relating to the people side of the
business.

• What impact will/ might they have on business performance?

• Consider skill shortages?
• The impact of new technology on staffing levels?

From this analysis you then need to review the capability of your
personnel department. Complete a SWOT analysis of the department -
consider in detail the department's current areas of operation, the service
levels and competences of your personnel staff.

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Step 4: Conduct a detailed human resources analysis

Concentrate on the organization's COPS (culture, organization, people,

HR systems)

• Consider: Where you are now? Where do you want to be?

• What gaps exists between the reality of where you are now and
where you want to be?

Exhaust your analysis of the four dimensions.

Step 5: Determine critical people issues

Go back to the business strategy and examine it against your SWOT and
COPS Analysis

• Identify the critical people issues namely those people issues that
you must address. Those which have a key impact on the delivery
of your business strategy.
• Prioritize the critical people issues. What will happen if you fail to
address them?

Remember you are trying to identify where you should be focusing your
efforts and resources.

Step 6: Develop consequences and solutions

For each critical issue highlight the options for managerial action
generate, elaborate and create - don't go for the obvious. This is an
important step as frequently people jump for the known rather than
challenge existing assumptions about the way things have been done in
the past. Think about the consequences of taking various courses of
action.

Consider the mix of HR systems needed to address the issues. Do you

need to improve communications, training or pay?

What are the implications for the business and the personnel function?

Once you have worked through the process it should then be possible to
translate the action plan into broad objectives. These will need to be
broken down into the specialist HR Systems areas of:

• employee training and development

• management development

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 • organization development
• performance appraisal
• employee reward
• employee selection and recruitment
• manpower planning
• communication

Develop your action plan around the critical issues. Set targets and dates
for the accomplishment of the key objectives.

Step 7: Implementation and evaluation of the action plans

The ultimate purpose of developing a human resource strategy is to

ensure that the objectives set are mutually supportive so that the reward
and payment systems are integrated with employee training and career
development plans.

There is very little value or benefit in training people only to then

frustrate them through a failure to provide ample career and development
opportunities.

Functions

The Human Resources Management (HRM) function includes a variety

of activities, and key among them is deciding what staffing needs you
have and whether to use independent contractors or hire employees to fill
these needs, recruiting and training the best employees, ensuring they are
high performers, dealing with performance issues, and ensuring your
personnel and management practices conform to various regulations.
Activities also include managing your approach to employee benefits and
compensation, employee records and personnel policies. Usually small
businesses (for-profit or nonprofit) have to carry out these activities
themselves because they can't yet afford part- or full-time help. However,
they should always ensure that employees have—and are aware of—
personnel policies which conform to current regulations. These policies
are often in the form of employee manuals, which all employees have.

Note that some people distinguish a difference between HRM (a major

management activity) and HRD (Human Resource Development, a
profession). Those people might include HRM in HRD, explaining that
HRD includes the broader range of activities to develop personnel inside

15
of organizations, including, e.g., career development, training,
organization development, etc.

There is a long-standing argument about where HR-related functions

should be organized into large organizations, e.g., "should HR be in the
Organization Development department or the other way around?"

The HRM function and HRD profession have undergone major changes
over the past 20–30 years. Many years ago, large organizations looked to
the "Personnel Department," mostly to manage the paperwork around
hiring and paying people. More recently, organizations consider the "HR
Department" as playing an important role in staffing, training and helping
to manage people so that people and the organization are performing at
maximum capability in a highly fulfilling manner.

NEED OF THE STUDY

As we know services are a growing industry and many firms are striving
to deliver value added services to their customers. In this regard banks are
continuously focusing towards improving their services. Similar is the
case with Standard Chartered Bank. This Bank has evolved tremendously

16
during the last couple of years and now has become one of the leading
banks in the country.
Keeping this in view the study has been undertaken to identify the
strategies and plans of the Bank and to identify the methods adopted by
the Bank to train and motivate their people and work force.

OBJECTIVE OF THE STUDY

The project has been undertaken to assess the Strategic Human Resource

17
Management practices of Standard Chartered Bank with the prime focus
at formulation of strategies and tactics and how it contributes in
implementing the strategies

PERIOD OF THE STUDY

18
 The period of study is limited for a span of three months.

RESEARCH METHODOLOGY

Population:
The research conducted is a qualitative research to find out the HR
Management practices of Standard Chartered bank. People who belong
to this bank are considered as highly paid people. The employees of the
bank were selected as the population to carry out the research that are the
fully satisfied with the recruitment policies of their bank and their bank is
following the policies in a proper manner.

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Sampling Frame:
The sampling frame will be people belonging to the upper, middle and
upper lower class and are currently working for the bank. The major part
of the sampling frame will be from the upper and middle class because
this is the major chunk of population who are banking professionals.

Sampling Procedure:
The sampling procedure used is convenient sampling and according to
this sampling technique all the people that roughly fit into my sampling
frame and which belong to this bank. The sample size was a total of 100
people who were currently working for the banking sector in Oman. Total
400 questionnaires were distributed out of which I only received 100
filled questionnaires.

Data Collection procedure:

The data collected is through Primary and secondary sources and through
the responses to the questionnaires conducted. Also, through the Internet,
published articles, interviews, books, and HR manuals.

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 LIMITATION OF THE STUDY

It is hereby stated that the study was conducted

for a span of three months and as a result the
interferences and the conclusions are slightly
biased due to the constraint of the short time of
span.

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 CHAPTER 2

CORPORATE PROFILE OF
STANDARD CHARTED BANK

PROFILE OF STANDARD CHARTED BANK

Standard Chartered is the worlds leading emerging markets bank

headquartered in London. Its businesses however, have always been
overwhelmingly international. Standard Chartered is name after two
banks, which merged in 1969. They were originally known as the
Standard Chartered Bank of British South Africa and the Chartered Bank
of India, Australia and China. Of the two banks the Chartered Bank is the

22
older having been founded in 1853 following the grant of Royal Charter
from Queen Victoria. The moving force behind the Chartered Bank was a
Scot, James Wilson, who made his fortune in London making hats. James
Wilson went on to start The Economist, still one of the world’s pre-
eminent publications. Nine years later, in 1862 the Standard Bank was
founded by a group of businessmen led by another Scot, John Paterson,
who had immigrated to the Cape Province in South Africa and had
become a successful merchant. Over the following decades both the
Standard Bank and the Chartered Bank printed bank notes in a variety of
countries including China, South Africa, Zimbabwe, Malaysia and even
during the siege of Marketing in South Africa. Today Standard Chartered
is still one of the three banks, which prints Hong Kong’s bank notes.

The Post War Years:

After the Second World War many countries in Asia and Africa gained
their independence. This led to local incorporation in some countries,
particularly in Africa. Other operations such as those in Iraq, Angola,
Myanmar and Libya were nationalized, while in Indonesia the Jakarta
office was destroyed in an attempted coup d’etat. In 1948 the Chartered
Bank opened in Bangladesh and during 1957 it acquired the Eastern
Bank. The Eastern Bank gave the Chartered Bank a network of branches
including Aden, Bahrain, Beirut, Cyprus, Lebanon, Qatar and the United
Arab Emirates. The Chartered Bank also entered into a joint venture to
form the Irano-British Bank, which opened for business in 1959. The
bank grew rapidly and had 24 branches when it was nationalized in 1981.
By the mid 1950’s the Standard Bank had around 600 offices in Southern,
Central and Eastern Africa. Its network grew substantially in 1965 when
it merged with the former Bank of British West Africa, which had some
60 branches in Nigeria, 40 branches in Ghana and eleven branches in

23
Sierra Leone in addition to operations in Cameroon and Gambia. Despite
these acquisitions and expansion into new counties such Mexico, South
Korea and Oman 1968, both the Standard and Chartered Bank networks
were comparatively small. Both viewed the future with some trepidation
as the need to protect themselves from acquisition became ever more
apparent. Standard Chartered PLC in 1969 the decision was made by the
Standard Bank and the Chartered Bank to undergo a friendly merger thus
forming Standard Chartered PLC.

By the late 1980’s Standard Chartered already had considerable exposure

to third world debt. To this was added provisions against loans to
corporations and entrepreneurs who could not meet their commitments.
Standard Chartered reviewed its operations and decided to focus on its
core strengths of Consumer Banking, Corporate & Institutional Banking
and Treasury in its well-established operation in Asia, Africa and the
Middle East. This led to a series of divestments notably in Europe, the
United States and Africa. During this time staff numbers were reduced;
business not considered core were sold or closed; associate holdings
disposed of; unprofitable branches closed and back office functions
consolidated. In addition expensive buildings were sold with the proceeds
reinvested in the business, and the senior management team was radically
changed and strengthened.

Standard Chartered in the 1990’s:

Even within this period of apparent retrenchment Standard Chartered
expanded its network, re-opening in Vietnam in 1990’ Cambodia and Iran
in 1992, Tanzania in 1993 and Myanmar in 1995.

Standard Chartered Today:

24
Today Standard Chartered is the worlds leading emerging markets bank
employing 30,000 people in over 500 offices in more than 50 countries
primarily in countries in the Asia Pacific Region, South Asia, the Middle
East, Africa and the Americans.

The new millennium bas brought with it two of the largest acquisitions in
the history of the bank with purchase of Grindlays Bank from the ANZ
Group and the acquisition of the Chase Consumer Banking operations in
Hong Kong in 2000.

These acquisitions demonstrate Standard Chartered firm is committed to

the emerging markets, where the Bank has a strong and established
presence and where they see their future growth.

Performance Review in Oman:

Standard Chartered has been in Oman since 1969 and is one of the few
operating foreign banks. There are 2 branches of Standard Chartered
Bank and one head office in the sultanate offering full banking services in
corporate, institutional and consumer banking services. Adopting a pro-
active approach, the bank is able to offer a flexible and comprehensive
range of financial services in particular transactional banking products.
The bank has also invested in its branches to ensure that their business is
supported by high-tech operations using state-of-the-art technology.
Dedicated customer services with solution-oriented cash specialists to
provide customers with cost-effective solutions. Electronic delivery
system has been put in place to give customers maximum control of their
transactions.

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26
 CHAPTER 3

DESIGN AND APPROACHES

DESIGN AND APPROACHES

Services Design:
Designing services to accommodate their unique characteristics is
challenging. One reason productive improvements in services are so low
is because both the design and delivery of service products include
customer interaction. The services provided at SC Bank are primarily
based upon a few approaches. The outsourcing of payments continues to
be a major area of focus for finance and treasury professionals. Over the

27
past years, competition has become more intense and this has helped
drive the increase in the number of companies that use payments
outsourcing as a way to reduce cost and focus on core activities.

The Ad Hoc Approach:

The ad hoc approach is often the default method of regionalization of
payments and other cash management activities. This is often undertaken
when decision-makers make a priority determination that centralizing
cash management activities offers significant benefits to the bank and
thus should be implemented. At Standard Chartered this approach is
frequently accompanied by minimal investigation and planning, which
invariably leads to difficulties and dissatisfaction. The sum total of
planning is often reduced to determining which financial institute can
best meet the open ended requirements of the bank.

Banks may be guilty of reinforcing the ad hoc approach if they do not

take the time to understand their customer strategies, objectives and type
of businesses, and make recommendations that may not have been
originally considered. This can be a function of whether the service
provider considers the implementation of capabilities as simple sale or
the start of a long-term implementation.

The Strategic Approach:

The Strategic approach is also part of a global or regional strategic
planning process that encompasses the entire organizational structure of
the Bank. Often this is accompanied by the implementation of a high-end
Enterprise Resource Planning (ERP) system, such as Oracle or SAP,
which integrates the various units.

28
The Pragmatic Approach:
The pragmatic approach alone is not a priority but rather a post-hoc
determination. The most straightforward and effective questions that the
Bank asks itself when taking the pragmatic approach are:
Where are we now? / Where do we want to be?
What is the best way to get there?

Limitations of the Ad-Hoc Approach:

The disadvantage of the ad hoc approach is that sometimes the bank over
or under estimates the transaction costs and thereof the benefits obtained
from centralization choose their significance.

Limitations of the Strategic Approach:

Disadvantages of the strategic approach are chiefly a function of size and
complexity. The strategic approach may not be the most cost effective as
it often ignores the implementation and running costs in favor of a
corporate strategy that is geared toward centralization.

Limitations of Pragmatic Approach:

The disadvantage of the pragmatic approach is the difficulty in
maintaining implementation efforts that are proportionate to the
advantage that the Bank can gain from the centralization activity.

Operations Strategies for Banking Services:

How can we satisfy our customer? This is perhaps the most important
question that the Bank can ask from itself and its people. Customer needs
and wants to run the full gamut, from tangible products, quality of
services delivered, and attitude of the entire management to the
aesthetics. In this regard, Standard Chartered Bank aims at satisfying

29
these needs and wants by developing and fulfilling missions and
strategies, which can be as diverse as the customers they serve.

Operational Strategies:
 To steadily develop the lending business and upgrade the quality of
loan assets.
 In lieu of Islamic banking the Bank aims to aggressively promote fee-
income business to raise non-interest revenue sources.
 To provide efficient services to fulfill customers needs and create a
high-quality service image.
 To actively set up business units in major business centers of the
country.
 To aggressively develop international banking operations and seek
opportunities to develop strategic alliances with other banks to create
new products and services.

Operation Plans:
The Operational Plans of the Bank are Deposits, Loans, Domestic
Banking, Trust Operation and Treasury Operations

CHAPTER 4

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 STRATEGIC HRM PRACTICES OF SCB

STRATEGIC HRM PRACTICES OF SCB

(STANDARD CHARTED BANK)
People, rather the employees are the asset of any organization. An
organization, whether it is a manufacturing concern or service oriented,
cannot function without the active participation of people.

Standard Chartered is the world’s leading emerging markets bank. It

employs 30,000 people in over 500 offices in more than 50 countries in
the Asia Pacific Region, South Asia, the Middle East, Africa , United
Kingdom and America.

31
Human Resource Planning:
HR planning is a process, which anticipates and maps out the
consequences of business strategy on an organization’s human resources.
This is reflected in planning of skill and competence needs as well as
total headcounts. Every organization needs to be able to forecast and plan
for its future people requirements.

At Standard Chartered Bank, human resource planning involves

forecasting the numbers of people which will needed by the bank, and
then working out the best way of obtaining then as and when they are
needed.

Forecasting:
Forecasting is the major function of the bank’s HR department. The
forecasting activities include:
1. Workforce numbers in sufficient detail to be useful.
2. Likely changes to the work of the bank.
3. Work force supply – this involves forecasting the variations in the
current work force estimated to occur over the following years.
4. Impact on budgets and funding.

Who ‘s responsible for it?

It’s easy to shift responsibility and say that personnel and human resource
departments should carry out HR planning , but it should be the concern
of every manager. As the Bank operates in a dynamic environment where
new and advanced practices are frequently emerging resulting in
changing customer’s requirements.

32
Good Practice Indicators:
Standard Chartered Bank makes sure that effective human resource
planning processes are in place when
1. Appropriately skilled people are available to be deployed in the
Bank’s to meet forecast work demands.
2. The Bank’s structure provides with opportunity for appropriate
career development, and is perceived to contribute to effective and
efficient work practices.
3. Relevant workforce data is readily available to inform management
decision-making on human resource issues.

Standard Chartered Bank ‘s Structure:

The Bank’s structure is the means by which the work is integrated to
ensure that the objectives and activities of individual work teams and
departments match the overall goals.

The structure of the Bank provides scope for the flexible deployment of
people and to promote equity, job satisfaction, motivation and
commitment to goals; as well as providing access to career development.

Workforce Analysis (Supply and Demand)

The effective collection and analysis of workforce statistics trends in the
workforce to be considered with the specific requirements for skilled and
qualified people to meet the corporate aims to be kept in mind.

Workforce statistics and analysis support Bank’s efficiency and

effectiveness by providing a firm basis for human resource planning. Any
information gathering systems in place should support manages and be

33
responsive to their needs as well as being easily accessible in the
workplace.

Training & Development:

Development is critical to future business success. The bank performance
will only continue to improve if it develops the people who are part of the
bank . To develop people is to invest in the future.

As Standard Chartered , training is a partnership between the employee

and the Bank. The Bank provides a framework within which the
employee can identify the training and development needs. Such training
provides a consistent standard of management learning throughout
Standard Chartered . It also enables the employees to take all of the
programs or study for individual modules according to their particular
development needs.

The Initial Two Years:

What the employee can expect to experience during initial 2 years
training is a blend of core and discretionary elements , such as:
1. Induction i.e. the processes that introduces the new entrant to the
bank, the employee’s own business or function and particular
department.
2. Training in specific products or technical skills.
3. Work-based assignments in respective business or function i.e.
doing a job in a particular department for a period of time.
4. Cross-functional attachments – experiencing short period of time
spent in another business or support function.

Long Term Training:

34
Development and training does not stop after two years. After this initial
training, the employees are faced with internal development programs,
business-related studies and professional qualifications, and the bank also
offers the opportunity to develop skills through externally accredited
courses. These are designed in conjunction with top universities and
business schools including postgraduate , MBA.

Accreditation Internal
External Schools Executive Development
MBA Diploma in Management
Certificate in Management Foundation Course
Induction Course

Orientation:
Every staff member joining Standard Chartered Bank has to attend a 2-
day comprehensive orientation to get a feel about the Bank and its
business. This orientation program provides a good chance to meet with
seniors & colleagues and to build up the team spirit.

Product Training:
Product training is provided e.g. cash product training, operational
training etc. to help the related staff to learn more about the products that
the Bank is providing.

Skill Training:
The bank provides a lot of skill related training e.g. credit workshop,
sales & negotiation skills , project management , etc. to help staff
enhance their skill in particular aspects.

35
On-job Training:
Staff members are continuously involved in the learning process in the
form of on-job training . Thus , a lot of on-job training opportunities and
job rotation to increase staff’s exposure are provided.

Self-learning:
The bank sends out CDs and books to staff for them to study on trade
knowledge , credit knowledge, etc. and staff will decide when he/she will
attend the Trade Skill Assessment(TSA) and Credit Skill Assessment
(CSA).

Management Development Training:

In this training program, the employees are given strategic perspectives
and business goals management skills; people management , networking
and customer focus abilities to better understand and manage their jobs.

Specific Competency Training:

Specific Competence Training is to ensure that the staff excels in product
knowledge, regulatory and unique techniques needed for the particular
position.

Learning and Development:

Standard Chartered recognizes that it is essential that they have the best
people equipped with the right skills and knowledge to perform their
roles to the highest standards. They went talented professionals, who seek
self-development opportunities including continuing professional
development. In return the Bank offers excellent training and
development. They focus development on where they believe that they
will get the greatest return, by developing employees strengths.

36
Recruitment:
To facilitate the recruitment process the candidates can apply online on
the web portal or can personally handover their resume to the local
branch office HR department. It is the aim of management to recruit
young, bright, energetic and enthusiastic graduates and post graduates.

Who are they recruiting?

1. Bright, young graduate or a postgraduate, who cannot wait to start
his/ her career in the financial services industry.
2. Consistent academic performer throughout his/her education.
3. Career-oriented person
4. Energetic, ambitious, innovative and business-oriented person.

Recruitment Criteria:
Standard Chartered Bank recruits the most talented individuals from the
external market to supplement their internal pipeline of talent. Their
Human Resources department provides guidance on the use of
psychometric tests and has robust recruitment criteria to ensure that all
candidates are treated fairly, equally and with respect. It has a global
Graduate Recruitment Program; where in the region of 150 graduates are
recruited each year on a management trainee program across all
businesses, functions and countries.

Selection:
Standard Chartered selects employee based on knowledge, skills and
talent. They are committed to providing equality of opportunity to all
employees, regardless of gender, race, nationality, age, disability, ethnic
origin, or marital status. They are committed not just providing equality

37
of opportunity to all employee, but also identifying what unique strengths
each individual brings to the roles they carry out and the development of
these strengths.

Employee health, well-being and safety:

Standard Chartered Bank believes that the health and wellbeing of their
employees and their families is important. They are concerned not only
about the physical health of their employees, but also their mental and
emotional well-being. Standard Chartered has policies & practices that
provide for a safe and healthy working environment. They place
importance on the safety and well-being of their staff, communities and
on the effect its working and operational processes have on the
environment. They are continually developing policies and practices
designed to maintain the highest appropriate standards.

Compensation:
At Standard Chartered Bank, the compensation package provided to the
employees can be divided into two categories. One comprises of the sales
personnel who are compensated on their ability to meet their targets.
Second is compensating the executives who are responsible for the
overall functions of the Bank.

Compensating the Sales Force:

How the Bank presents itself to its corporate as well as individual
customers is dependant upon the ability of its sales force. These are the
individuals who take and active approach is getting the message out about
the Bank’s products and services. How effectively the sales team markets
the Bank and in run, how successful it is, is directly related to the sales
compensation program.

38
The key to a successful sales compensation program is achieved in three
steps:
1. Clearly defining sales goals that are realistic but challenging
2. Tracking and measuring performance against goals
3. Rewarding achievement with competitive and motivational
compensation
Sales compensation packages typically comprise one or more of the
following components:
1. Base Salary
2. Periodic incentives tied to short-term goals
3. Annual Incentives tied to longer-term sales activities
4. Commission-based incentives
5. Perquisites to facilitate sales efforts

Executive Compensation:
The way the Bank pays its top management plays an important role in
motivating the critical performance needed to run it effectively. Base
salary is not the only component of the typical executive’s compensation
package. Executive compensation packages typically comprise the
following components:
1. Base Salary
2. Annual Incentives
3. Long-Term Capital Accumulation
4. Deferred Compensation Arrangements
5. Supplement Benefits and Perquisites
6. Special Severance and Retirement Arrangements
7. Employment and Change of Control Agreements

39
Reward & Recognition:
Standard Chartered Bank aims to reward the talented and high
performing employees competitively. They regularly conduct salary
surveys to ensure that the reward package remains competitive in the
market place. They encourage continuous discussion; encourage regular
review of employees’ performance and development. This provides
feedback to the staff about how they are doing. The management links
this to both financial and non-financial recognition.
In addition to this, the bank provides various incentives in the form of
bonuses to encourage the employees and motivate them to continue with
their high performance. These include Spot Award, Surprise Award, Best
Performer Award, Service Quality Award, and Year of Excellent Services
Award.

Quality of Work Life:

This means a job that not only is reasonably safe but also for which the
pay is equitable. At Standard Chartered Bank every employee in
confident of his job security and has the assurance that he would remain
on the job for the agreed period. In addition to this, the workload is
equitable divided between the employees and therefore, they work with
peace of mind and tranquility resulting in the overall enhanced
performance of the employees.

Mutual Commitment:
Both the employees and the management try to meet the common
objectives. They coordinate their activities to ensure that they are heading
towards achieving the established goals and meeting the set targets within
the specified time frame.

40
Mutual trust:
At Standard Chartered Bank prevails an environment of confidence and
mutual trust. The documented employment policies are honestly
implemented to the satisfaction of both management and employees.

Job Design:
Job design comprises of six components. These are:

Labor Specialization:
The Bank aims at hiring specialized people and their recruiting criteria
are based on their knowledge, expertise, past working experience and
their exposure to the professional fields. Employee wages are set in
accordance with the aforesaid recruitment criteria and most of them are
intent with what they earn at Standard Chartered Bank

Job Expansion:
The Bank improves the quality of work life by assigning various tasks to
the employees so as to equip them with the different services offered by
the Bank. Job expansion includes job enlargement, rotation, enrichment
and empowerment.

Psychological Components:
For enhancing the skills and abilities of the work force, the psychological
components of job design are also catered for by Standard Chartered
Bank. These psychological components focus on how to design jobs that
meet some minimum psychological requirements of the employees.
These components are utilized in accordance with Core Job
Characteristics, which suggests that the jobs designated to the various
employees in the bank include the following five aspects:

41
 1. Skill Variety
2. Job Identity
3. Job Significance
4. Autonomy
5. Feedback

Self-Directed Teams:
A self-directed team is a group of empowered individuals working
together to reach a common goal. At Standard Chartered Bank, these
teams are found in almost every department to achieve the set targets.
These teams are an integral part of the personal loans, sales and credit
cards department where they are established to achieve both, the short-
term as well as long term objectives.

Motivation and Incentive Systems:

1. Sometimes the psychological components are not enough for
motivating the employees. In this case, monetary incentives play a
vital role for increasing the commitment of the employees toward
their jobs and in return enabling them to have job satisfaction.
These monetary incentives and rewards are given in various forms
to the employees who act as a strong motivational factor.

Ergonomics:
Ergonomics is the study of work. It deals with building a good interface
between the man and the machines. Keeping this in view, the Bank has
been designed in such a way so that the employees are comfortable
working there.

Performance Management:

42
Traditionally, the formal performance appraisal system has been viewed
as the primary means for managing employee performance. Performance
appraisal is an administrative duty performed by managers and primarily
the responsibility of the HR function.

Performance management is the process through which managers ensure

that employee activities and outputs are congruent with the organization’s
goals. It is central to gaining competitive advantage.

Components of Performance Appraisal:

At Standard Chartered Bank the components of performance appraisal are
in respect of the five W’s that include: Who , What , Why , When and
Where of performance appraisal.
Who: All employees work under the supervision of managers. Therefore,
the manager is the best person to do performance appraisal of his
subordinates.
What: The appraisal at the organization includes appraisal of current
performance as well as the future potential. It also includes evaluation of
human traits such as behaviors, interaction with other staff members etc.
Why: It is concerned with creating and maintaining a satisfactory level of
performance of employee in the present job, highlighting his needs and
potential for personal growth.
When: It is carried out on yearly basis. The manager uses good
work as opportunity to provide positive thrust and uses poor work as a
basis for training.
Where: The performance appraisal is done in a cordial and friendly
environment.

Approach of Measuring Performance:

43
The performance of the employees can be determined by making an
overall comparison among individual‘s performance. Hence a
performance measurement system is developed that incorporates a tool
for measuring performance.

Appraising Employee Performance:

Individual Performance Management:
A longstanding question that Standard Chartered Bank and many other
organization are still grappling with is whether and how to reward good
performance (or, conversely, how to deal with persistent poor
performers). One approach used by the bank is to make salary increments
or progression on the pay scale conditional on good performance.

Performance Management At Senior Levels:

Typically, performance management systems for senior officials include
elements additional to performance-pay, such as time-limited contractual
appointments. The Bank has adopted this approach. Key features of its
system include the following:
1. Senior officials are recruited to a unified career structure known as
Grade A, which incorporates most top-level positions.
2. On the basis of evaluation, the senior position employees are paid a
performance bonus.

Linking Performance to Promotions:

Some have argued tying career advancement to performance is more
important than linking performance and pay. Whereas the benefits of pay
for performance are uncertain, particularly in the lower echelons, there is
no doubt of the need to ensure that the best people rise to management
levels.

44
CHAPTER 5
ANALYSIS

45
ANALYSIS

HR Planning:
HR Planning process consists of forecasting, goal setting and strategic
planning, and program implementation and evaluation.

HR managers should attempt to ascertain the supply of and demand for

various types of human resources. The primary goal is to predict areas
within the organization where there will be future labor shortages or
surpluses.

As the Bank operates in a dynamic environment where new and advanced

practices are frequently emerging resulting in changing customer’s
requirements. Not only this, the demands on existing staff resources
fluctuate in order to maintain the provision of services, it becomes even
more critical that all managers contribute to HR planning in a structure
way.

Recruitment:

46
Human Resource Recruitment is defined ad any practice or activity
carried on by the organization with the primary purpose of identifying
and attracting potential employees.

The goal of an organizational recruitment program is to ensure that the

organization has a number of reasonably qualified applicants (who would
find the job acceptable) to choose from when a vacancy occurs.

Standard Chartered Bank recruits the most talented individuals from the
external market to supplement our internal pipeline of talent. Their
Human Resources department provides guidance on the use of
psychometric tests and has robust recruitment criteria to ensure that all
candidates are treated fairly, equally and with respect. It has a global
Graduate Recruitment Program; where in the region of 150 graduates are
recruited each year on a management trainee program across all
businesses, functions and countries.

Selection:
Any organization that intends to compete through people must take the
utmost care with how it chooses organizational members. Personnel
selection is the process by which companies decide who will or will not
be allowed into their organization. Several generic standards should be
met in any selection process, which are reliability, validity, general
ability, utility, and legality.

Standard Chartered selects employees based on knowledge, skills and

talent. They are committed to providing equality of opportunity to all
employees, regardless of gender, race , nationality , age , disability ,
ethnic origin , or marital status.

47
Training & Development:
Training refers to a planned effort by a company to facilitate the learning
of job-related knowledge, skills, or behavior by employees.

Standard Chartered provides a framework within which the employee can

identify the training and development needs. Such training provides a
consistent standard of management learning throughout Standard
Chartered. It also enables the employees to take all of the programs or
study for individual modules according to their particular development
needs.

Development Programs are carried out in the first two years of joining,
applicable to all management trainees, across the Bank. Each business
and function would decide the appropriate development needs for each
individual, within this overall framework.

Performance Appraisal:
Each organization must create and communicate performance measures
that reflect its unique strategy.

Performance management is the process through which managers ensure

that employee activities and outputs are congruent with the organization’s
goals. It is central to gaining competitive advantage.

A well-executive performance management plan enables an organization

to achieve critical goals such as:

1. Recognize the efforts and contributions of current staff.

48
2. Reward staff with compensation directly linked to performance.
3. Motivated staff to improve performance.
4. Orient staff towards goal achievement.
5. Retain key employees through the use of competitive compensation
programs.
6. Attract quality employees with an effective performance management
system.
The key elements of a Performance Management System include the
following:
1. A Formal Compensation Philosophy Statement
2. Salary Administration Program
3. Job Evaluation System
4. Performance Appraisal System
5. Reward Programs

Purpose of Performance Appraisal:

There are a number of reason for carrying out the performance appraisal
of employees such as promotion, transfer etc. Therefore, the Bank makes
sure that the employees clearly understand the objectives of the
performance appraisal.

Performance Measurement Criteria:

Once the Bank has determined what kind of performance it expects from
the employees, it needs to develop appropriate ways to measure that
performance.

Strategic Congruence:

49
The basic aim of Standard Chartered Bank is to provide speedy customer
services. Therefore its performance management system should assess
how well its employees are serving the customers. Strategic congruence
emphasizes the need for performance management system to provide
guidance to the employees so that they can achieve the Bank’s and enable
it to remain competitive. For this purpose the system should be flexible to
adapt to changes.

Validity:
According to the employees, the appraisal procedure used to measure
their performance lacks in one aspect. This aspect relates to the
deficiency element of validity. This means that as one standardized
format is used to evaluate performance, therefore it ignores many of the
job specific aspects.

Reliability:
At Standard Chartered Bank the performance management criteria
resembles test-retest reliability. According to this the employees are
evaluated on annual basis and those employees who have somewhat
similar ratings from year to year have greater chances of getting
promotion, bonuses etc. Therefore, the Bank checks the consistency of
performance of employees in this manner and determines that which
employees have the potential to grow and better serve the customers.

Acceptability:
Diverging opinions prevail about the acceptability of the performance
appraisal. Some employees accept them to be fair while others believe
them to be biased and predetermined. In addition to this the views

50
regarding fairness are perceived differently within the three category
including:
1. Procedural
2. Interpersonal
3. Outcome

Specificity:
One of the major lacking in the performance appraisal method of
Standard Chartered Bank is in the area of specificity. Amongst the
various levels of employees the performance evaluation is believed not to
provide specific guidance about what is expected of them and how they
can meet these expectations.

Source for Performance Information:

In case of Standard Chartered Bank, managers are the only and most vital
source of performance information. They have extensive knowledge of
the job requirements and adequate opportunity to observe the way in
which the employees fulfill these requirements, thus , they are the best
source to assess and rate their employees.

Rater Errors:
Like all other organizations, in Standard Chartered Bank the performance
evaluation process is affected by the rater’s error. The rater error
prevailing in the bank resembles the distributional errors. In the bank the
managers often go by their own preference while rating the employees.
Therefore there are high chances of making leniency, strictness, and
central tendency errors.

Top Management and Employee Perspective:

51
Although the performance management system at Standard Chartered
Bank has a vital role to play in assessing the potential of the employees.
Yet it is perceived to be a routine and cumbersome affair that has to be
undertaken once a year. This perception some what nullifies the true
essence in the performance management should be conducted.

Shortcomings of the Appraisal System:

The performance appraisal system at the Bank lacks in certain areas such
as:
1. Information regarding the employee’s performance is purely
dependent upon their managers. However, the employee are of the
view that information should also be collected from them as they
are the ones who perform are responsible for performing the
various tasks.
2. Thus, a major shortcoming of the system is that the employee’s are
not involved in the appraisal process.
3. The performance appraisal system is believed not to provide any
guidance for the development of employees.
4. The employees are of the opinion that the performance appraisal
should be done on quarterly basis, instead of being conducted
annually.

Necessary Measures:
Adopting the following measures can reduce the shortcomings of the
system:
Employees should be involved in the appraisal process, i.e. information
should be taken from them. The process should result in effective
outcomes by telling the employees that how can they improve their

52
performance. This would not only benefit the Bank, but would also help
the employees in their personal development.

Compensation:
Being a leading Bank Standard Chartered Bank presents itself to its
corporate as well as individual customer as dependent upon the ability of
its sales force. These are the individuals who take an active approach in
getting the message out about the Bank’s products and services. How
effectively the sales team markets the Bank, and in turn, how successful it
is, is directly related to the sales compensation program. A sound sales
compensation package enable Standard Chartered Bank to focus sales
activities towards desired results, and rewards these outcomes with
compensation tied directly to the level of achievement.

Rewards & Recognition:

Standard Chartered Bank rewards the talented and high performing
employees competitively. They regularly conduct salary surveys to
ensure the reward package remains competitive in the market place. They
encourage continuous discussion; encourage regular review of
employees’ performance and development. This provides feedback to the
staff about how they are doing. The management links this to both
financial and non-financial recognition.

In addition to this, the bank provides various incentives in the form of

bonuses to encourage the employees and motivate them to continue with
their high performance.

53
CHAPTER 6

CONCLUSION

54
 CONCLUSION

Based on the study, several conclusions have been made. These include:
1. In order to successfully conduct the HRM Strategies, Standard
Chartered Grindlays Bank should formulate effective internal and
external communication mechanism.
2. A conceptual framework understood by all levels of the bank
should be developed.
3. Accountability for results must be clearly defined and well
understood.
4. Performance measurement system must provide intelligence for
decision makers rather than just compiling data.
5. Compensation, rewards and recognition should be linked to
performance measurements.
6. Performance evaluation should be positive and not punitive.

55
 7. Employees should be specific as to what is expected from them so
that they direct their efforts towards achieving those expectations.
8. Feedback on the evaluation should be provided to the employees so
that they can improve their performance.
9. Lastly, performance measurement systems should not be seen as a
benchmark to evaluate an employee but it is a means to understand
the potentials of an individual.

BIBLOGRAPHY

www.google.com
www.wikipedia.com
www.scb.co.in

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