Human Resource Management
Term Report
National Investment Bank
Shaan bin Ather Quadri 8837
Naila Mehtab 9419
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Abstract
This report will cover specific areas of Training and Development and related topics with T&D of
National IB Bank. It will be focusing how NIB hires potential employees, training and techniques
to motivate employees for greater productivity and effectiveness. It will also analyze the role of
the HRM department in today’s scenario, especially acknowledging the impact from financial
recession. The resource for this report is the Product Manager of Consumer Department,
Nabeel Hussain.
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Table of Contents
Abstract.......................................................................................................................................................2
Brief Introduction........................................................................................................................................4
Acknowledgements.....................................................................................................................................5
Hiring Employees.........................................................................................................................................6
Salary Determination and Benefits..............................................................................................................8
Performance Appraisal................................................................................................................................9
Conclusion.................................................................................................................................................11
Appendix...................................................................................................................................................12
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Brief Introduction
NIB Bank is a subsidiary of Bugis Investments which is a wholly owned subsidiary of Asia
Financial Holdings Pte. Limited which in turn is a wholly owned subsidiary of Temasek Holdings,
an investment arm of the Government of Singapore. NIB Bank has 27 operating branches (2005:
27 branches). Pacra has maintained its rating at "A+" (A Plus) for the long term and "A1" for the
short term. The bank has 30% interest in an associated undertaking, National Fullerton Asset
Management Limited (NAFA), incorporated in Pakistan.
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Acknowledgements
We, Shaan Quadri and Naila Mehtab, acknowledge the generous contribution by Mr. Nabeel
Hussain who gave much of his time and effort to gather relevant information for our report and
our study. This report has certainly enhanced our understanding about the importance of the
role of Human Resources and how to manage these resources suited from situation to
situation.
We also thank our course instructor and counselor, Dr. Khalid Amin, who guided us throughout
the course and enhanced our interest in the field. It is fortunate for us to take benefit from his
experience and teaching.
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Hiring Employees
NIB commonly uses in-house human resource management. The HR department approaches
Universities and then references from internal employees. A careful Job analysis is done, where
a need analysis is determined. The need often comes when a key post is vacant due to
resignation or transfer of a previous employee. Commonly there are three kinds of placements
that are taken for hiring in NIB:
Management Trainees:
The applications are generally fresh graduates from top business schools in Pakistan and
Foreign universities as well. Previously NIB used to hire from Institute of Business
Administration and Lahore University of Management Sciences. This year they have expanded
their pool of candidates to Institute of Business Management and National University of Science
and Technology. Most of these graduates are students of Business Administration. Letters are
sent to these universities, as part of invitation for annual MT programs and available seats.
Universities eventually respond with the list of their best students, who have the best Grade
Point Average.
Applicants are selected from list at random and are contact to appear for interview. These
interviews are done at 3 levels. The first interview is taken by the Head of Human Resources
Department, who does the initial screening of potential Trainees. The second interview is taken
by the Business Head who interviews and shortlist for the most probable trainees from the list
of students. The last interview is taken by a panel of interviewers who finally decide the group
of Management trainees.
Internees:
They are approached by the company and also applications are taken by students directly.
Internees are more in number and do not have a definite time in the year where internship
programs are run. They interviewed by the Human Resources department and are offered a
fixed stipend. They are followed by proper guidance by any superior, but there is not a standard
program, they are hired on a need basis. Internees are hired from any university, but ideally
hired through references from fellow employees.
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Permanent and Contractual Employees:
Hiring is only done for key posts that are vacant. They are experienced applicants who are first
interviewed as a part of the screening and selection process. Once hired, they are taken as
junior from the desired key position they had applied. They are tutored and guided by a senior
of the department until they are accustomed to the culture and processes of their job
description. Eventually they are promoted to the key position as a permanent employee.
Motivator/Hygiene Factor Effect
Management Trainee Induction for the best candidates in graduate profile, as future managers
package
MT training and job rotation Capability to understand how Banks work, able to make holistic decisions
Training Professional grooming and customer retention
Internship package Extra help for temporary work and projects, also possibility for future
potential employees, but no other additional benefit as they are not given
serious projects
Contract Package Sufficient for temporary work
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Motivator/Hygiene Factor Effect
Delay in payment of salary Demotivation and lethargy
Inequity in Salaries Highly demotivating, chances of creating conflict with HR department
Firing fellow employees/ Negative reinforcement, improves productivity
recession
Salary Determination and Benefits
Permanent employees receive additional benefits such as old age benefits, provident fund, and
entitled annual increments. They are much more costly than contractual employees.
Contractual employees, on the other hand, are hired from agencies and third party recruiting
agencies, which is eventually cheaper than hiring in-house. Contractual employees don’t have
the benefits which permanent employees enjoy.
Employees’ salary is designed over three main components:
inflation rate 12% for this year
marketing adjustment - fair market value 2 to 3%
extra ordinary performance
Two main factors are already decided by HR department, third factor is based on the whole
process of evaluating employees performance like consumer department head ,corporate
department head, credit department head prefer those employees who has put their efforts
and worked beyond the expectations, such employees have high promotion rate with 80% or
above .All the head of departments decides their assessment together and shows their
selective result to the board members and with everyone’s final decision ,selected employees
list is sent to the HR department so that they can send the official list to the HR department and
further it is sent to the selected candidates. This year’s NIB’s budget is 300 million rupees; it
has increased as compared to the last year which was 233 million rupees. There is a rule of NIB
that HR department promote their selected employees every year in July but mostly it depends
upon the condition, timings can be extended or delayed.
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Performance Appraisal
Performance appraisal is an essential part of NIB’s HRM, it has proven to help employee’s in
many ways. Employees learn to negotiate and bring up their concerns and contributions which
are possibly not come to notice. Employees learn to have a better understand of the product
they are working for and have a greater awareness of the competition. Training and
compensation creates professional grooming and customer retention. Appraisals have
eventually helped employees grow and help them discover that organization cares about the
employees. Organizations welcome employees who are sophisticated and understand work
politics as well as handling customers in difficult times. Eventually on a year to year basis it
helps employees update their resume as their abilities are being recognized.
Performance appraisal at NIB is a fool-proof method that acknowledges an employee’s
contribution through many angles. The appraisal process begins from an elaborate appraisal
form which is filled by the employee. The form has ratings from 1 to 5:
1: exceed expectations every time
2: exceed expectation most of the time
3: meet expectation
4: improve your performance
5: Made to resign
From the employee’s judgment, he/she selects each attribute and scores. These scores are then
sent to their immediate boss who makes relevant corrections according to their expectations.
Once signed, they are further sent to the Human Resources department that further inspects
and make final corrections if needed any. Eventually the form is sealed and sent back to the
employee. This appraisal has the greatest impact on employees.
The appraisal process is further reinforced by the end of every year when the bonuses and
increments are decided. At this time all the Heads of Departments settle down and discuss
about each and every employee who is working under them. Discussion is done and
contributions witnessed are pointed out. Through third person analysis this creates a list of
potential employees who could receive a bonus or a promotion. Those lists are sent to the
Board of Directors who critically analyzes those lists and shortlist the people who have done
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extraordinary performance. These employees eventually get a sizable bonus or promotion for
the year. The promotions are decided by a predetermined budget of salaries. The budget is
deducted of all the salaries and the leftover amount is distributed to the respective performing
employees.
Motivator/Hygiene Factor Effect
Employee of the month Employees who succeed to earn this award tend continue the performance for
Award consecutive months until another employee surpasses their performance
Increment in Salary Expected at the end of every year, without this there is significant
demotivation
Appraisals Employee's understanding of what is expected, gauge competition, improved
negotiation skills
Low score in Appraisal, from If the employee is very demotivated, at times the HR department increases
the HR department the score in order to retain the employee's productivity
Promotion Immediate improvement in productivity initially, new presentation
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Conclusion
Today the banking sector is suffering much due to the recent financial recession, which has led
to a sudden decline in hiring. This has further increased to firing of personnel and reduction in
bonuses. Due to this, there is immense focus on retention of employees and customers as costs
need to be curtailed and revenues are restricted. Budget for training is negligible and not
needed as banks are now attempting to retain old employees to maintain good productivity.
Therefore it is necessary that most of the Human resources are restricted to less employee
turnover.
Since there is still time before economy recovers from recession, there is no concept of training,
bonuses, hiring or more motivation practices until banks begin to maximize profits.
Nevertheless, at this moment, increment and bonuses have immense effect and employees are
extra conscious about their performance and retaining their jobs.
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Appendix
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