The Hindu Business Line : High performance in focus

Keeping pace with overall growth of economy, the Indian banking industry has now entered an era of unprecedented opportunities and concomitant challenges. While the basic ground rule for businesses, viz. that of creating and maintaining customers cann ot change, an emerging issue of major concern is of shoring up productivity and profitability.

In a nutshell, the future success stories of various banks would depend on their ability to build a high performing organisation. How do you achieve this?

“While high performance is a function of many things, it is imperative that the HR function in banks thinks (out of the box) and acts proactively as well as radically towards aligning HR initiatives with business goals,” says Prof M. Chandrasekhar, Dean, Research and Consulting, Administrative Staff College of India (ASCI), Hyderabad.

There are two factors that support the centrality of HR in high performance. “The banking, financial services & insurance (BFSI) segment, one of the most important components in the services basket, is reported to have grown at a healthy 11 per cent in 2006-07 (10.8 per cent in 2005-06).

Indian banking, willy-nilly, is fast catching up with high-tech sectors like IT, with attrition rates between 15 and 20 per cent. Dearth of talent and its proper handling is therefore turning out to be a major problem in the ambitious plans of banks,” he points out. Citing the observations in a recent publication in the Harvard Business Review, he adds that driving the customer satisfaction levels is the value of services provided, which in turn is a function of satisfied, loyal and productive employees. “The authors drive home the point that employee satisfaction is an outcome of high quality support services and policies that facilitate employees deliver results to customers,” he explains.

Mr Amitabha Guha, Managing Director, State Bank of Hyderabad, shares a similar view.

“Superior customer service, driven by an inspired team of employees offering good products, hold the key to building high performance in an organisation,” he opines.

SUCCESSION PLANNING

For sustained performance of a bank, right pricing (of the product), delivery and convenience of the customer are vital. “At the end, all deliverables are dependent on the quality of people, leadership, its continuity and a proper succession plan,” says Mr Guha.

“Currently, there is no proper succession plan is public sectors banks. Further, to maintain quality, continuity of leadership is also vital. We need to give reasonably long-periods to top executives and involve them in succession,” Mr Guha says.

Similarly, the presence of youngsters with specialised knowledge in various aspects of finance and marketing would also drive high performance. ,” the official says.

For organisational alignment too, a well-tailored HR vision is essential. “In any organisation, the alignment can be achieved only by a shared vision. Be it a bank, IT firm or a pharma company, we need a powerful vision to connect people and to raise their aspiration levels to post high performance,” Mr G.V. Prasad, Chief Executive Office, Dr Reddy’s Laboratories, observes.

“While the talent crunch will also be there for any industry, creating great leaders from among the staff is the real challenge,” he points out. The ways and means for tuning the human resource capital to high performance should be located at every level of an organisation, according to Prof Chandrasekhar. This can be done by the following measures, he suggests.

THE PRESCRIPTIONS

Aligning HR initiatives with business goals

Redefining the HR activities to bring in freshness into the organisation in tune with the changing times

Defining and designing new/enriched roles and responsibilities with a view to tapping and leveraging the potential of its human resources in novel ways

Developing innovative ways of promoting excellence

Revisiting the compensation systems (both tangible and intangible) so that they are increasingly driven by the employee’s value-addition

Donning the mantle of being an initiator and facilitator of change rather than a detractor

“Therein lies the prescription for our banks for evolving and implementing HR plans, processes and practices that contribute to a high-performing organisation,” says the ASCI scholar.