PROJECT

OF
Human Resource Management

Submitted By

MBA (Banking & Finance) 2nd Term

Session 2009-2011
Name of the Students Class Roll No Exam Roll No Signatures
Marium Burki B-2 461
Saima Burki B-1 460

Submitted To
Sir M Tufail

Department of Business Administration

Gomal university D I Khan 1
 In The Name Of “ALLAH”
The Most Gracious, Beneficial &
Most Merciful.

Department of Business Administration

Gomal university D I Khan 2
Methods of Selection /Test, Performance Appraisal & Training observed by
the public and private organizations?

 Gomal University

 Education department(School, Colleges)

 Banks.

 Health Departments(Hospitals)

 P.I.A

 NGOs

 Others

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Gomal university D I Khan 3
Contents Page No.

Selection process in NBP-------------------------------------- 5

Performance Appraisal -------------------------------------- 11

Performance Appraisal in Bank--------------------------- 11

Performance Appraisal in NBP----------------------------- 15

Training and Development----------------------------------- 17

Training Techniques------------------------------------------- 18

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 Selection process in National Bank

What is selection?
In selection process management selects the best one, who can
fulfill all the requirements of the organization. In short selection process can be defined as
“choosing a person suitable for a job out of several persons”.
Different organizations have different selection process depending upon the
size, economic conditions, policy etc of an organization. However the bank operates an
extremely thorough and efficient selection process to ensure that only the very best
candidates are presented to clients. The process is detailed below and yields candidates
with right fit, so that the clients can suitably execute their strategy in accordance with
project timelines.
 Receipts of applications
 Application blank
 Screening of applicants
 Preliminary interview
 Selection test
 Background investigation
 Medical test
 Induction

 Receipt of applications

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 It is the very first step in selection process. Resumes
are obtained from variety of sources that include internet job boards, job fairs, employee
referrals and direct recruitment.

 Application blank
Application forms are a good way to quickly collect verifiable
and fairly accurate historical data from the candidate. Application blank is the
application form to be filled by the candidate when he applies for a job in the company.
The application blank collects information consisting of 4 parts-
• Personal details
• Educational details
• Work experience
• Family background

 Screening of applicants
Potential applicants are screened in order to confirm their
relevant skills, experience and availability. Screening of applicants means to remove
individuals who obviously do not meet the position requirements. At this stage, a few
straightforward questions are asked. The Purpose of Screening is to decrease the number
of applicants being considered for selection.

 Preliminary interview

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 Applicants are interviewed at one of the offices and are
required to sign off their agreement to client confidentially, criminal background,
health and safety and human rights policies, as a condition of their employment
contract with the bank. Once complete, the interview process is broken up into
four stages.

 Stage 1 – Interview
The recruiters conduct a chronological review of the applicant’s
education and experience.

 Stage 2 – Behavioral –Based Assessment

The applicants participates in a comprehensive behavioral
based interview to determine their personality type, performance standard, work
habits, reliability, integrity and fit.

 Stage 3- Knowledge and Skill Assessment

Applicant participates in a technical interview that includes a
demonstration of previous abilities to determine the degree of their technical
aptitude.

 Stage 4-Verification of Employment Requirements

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 Applicant confirms their understanding and agreement
regarding the job location and if it is suitable for them, their available start date,
hours or shifts that are required to work, if they have suitable transportation for the
job and the current pay rate being offered.

 Selection test
A selection test is an instrument which is designed to measure the
selected qualities and abilities of prospective candidate in terms of job specification
or it means that employer wants to get information about qualities and abilities of
candidates according to specification of job. The test may be of different types
according to the organization needs and requirements. Following are the different
types of tests.

 Intelligence test
 Aptitude test
 Achievement test
 Interest test
 Personality test
 Background investigation
The bank also collects the background information of the
employee. In this step criminal background checks and Government security
clearances are performed, where job specification deem them to be bona fide
occupational requirements.

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  Medical test
It’s also an important step in selection process. When person
who complete all the steps prior to medical checkup come to the medical
superintendent of the bank who will completely examine the employee from the
medical point of view, that whether he is physically fit for vacancy or not. In the
medical checkup, doctor checks many things. If the person is physically and
mentally fit, he will be selected.

 Initial Job Offer /Proposal

Candidates who successfully clear the medical exam are given
an initial job offer by the company stating the details regarding salary, terms of employment,
employment bond if any etc. The candidate is given some time to think over the offer and to
accept or reject. Initial Job offer is made through a letter of appointment. Such a letter generally
contains a date by which the appointee must report on duty. The appointee must be given
reasonable time for reporting. That is particularly necessary, which means considerable
preparation, and movement of property.

 Acceptance/ Rejection
Candidates who are happy with the offer send their acceptance
within a specified time limit to show that they are ready to work within the bank.

 Letter of appointment
Candidates who send their acceptance are given the letter of
appointment. The letter/ contract of employment will state the name of the job. The salary and
other benefits, number of medical leaves and casual leaves, details of employment bond if any etc.
It will also state the date on which the employee is required to start duty in the bank.

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  Induction
When the candidate fulfills all the steps i.e. test, interview, medical examination
etc then finally he is selected. On the date of joining the employee is introduced to the company
and other employees through an elaborate induction program.

Receipts of applications

Application blank

Screening of applicants

Preliminary interview

Selection test

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 Background investigation

Medical test

Induction

Selection Process

Performance Appraisal

What is Performance Appraisal?

According to FLIPPO,” the systematic periodic and
impartial rating on an employee excellence in matters pertaining to his present job and to
his potentialities for a better job is called performance appraisal”.

Effect of performance appraisal

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 Performance appraisal effects in the following way.
 Performance appraisal assists the manager to observe their subordinate more
closely and do a better job of coaching/training if needed.
 It motivates employees by providing feedback on job performance.
 It reduces favoritism in main managerial decisions about personnel.
 It provides information about human resource planning.
 With the help of performance appraisal organization achieves better operational
reserves and improves work performance.

Performance Appraisal in Bank

With the swift expansion in the number of branches and the new
functions assigned to them, banks are beginning to feel pressure on their organizational
abilities.
In the organizational planning to fulfill their new role, banks could with practice benefit
management development. This concerns the process of recruitment, placement, training,
promotion and appraisal, in order to ensure the right number of staff with the right
capacities is available at the right time and for the right place.
In that effort appraisal is a key factor, if the appraisal system is undiscerning, time can be
lost and opportunity delayed in injecting the right experience and the right information to
close the gap between what should be and what is.

Bases of appraisal
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 Formal appraisal reports on staff are of recent origin in banks. When
banks were small in size decision about salary and placement are made on the basis of
personal knowledge and were centralized. These decisions continue to remain centralized,
not withstanding dispersion of branches and staff. The geographical spread of branches
meant that the executive who decided the salary increase and placement have very limited
personal knowledge of the personnel on whom he made decisions. He had to rely on
appraisal reports. With the rapid expansion of branches and staff, since it was no longer
possible to remember either the name or faces of the staff members, resort had to be made
to record judgments on staff in the form of annual appraisal reports.
The trait approach is ill-suited to act as a basis for training, intrinsically it hardly
favors the idea of training and instead encourages concentration on selection. It is
therefore necessary to design a system of appraisal which will be a movement away from
personality traits and mean closer adherence to the principle of performance on the job.
Instead of appraising the man, the endeavor needs to be appraising on the job. The
objective of such an appraisal is to clarify responsibilities for recruits; to identify potential
managers; to indicate areas of strength and weakness in individual so as to serve as a guide
for the banks training and placement policies and to provide an updated inventory of
personnel.

Assessing performance
It is not possible to prejudge the capacity of an individual with
certainty. Of critical importance, therefore, is the need to judge their on the job
performance. An officer’s past and present performance can be a reliable measure to his
future performance. The ability of management to judge an individual performance
objectively is basic to the continuing success of banks in locating persons with potential
and in providing developmental opportunities. It has been argued that in banking sector
performance cannot be measured and staff productivity in the banks is also falling.
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Gomal university D I Khan 13
Undoubtedly there are enormous problems in measurement of white collar productivity,
but it could be done if an officer is judged by results and not by mere activity in which he
engages himself. This is made possible by Management by Objective.

Management by Objective
It is a system which integrates the bank’s need to clarify
and achieve profit and growth goals with officer’s need to contribute and develop him.
In such a system the bank begins with statement of goals. This permits the definition of
its function which it must perform to meet these aims and of the organizational structure
required to perform them. Major objectives, relating to a specified period of time, are then
determined for the bank as a whole and for its region and branches; these can be hen
subdivided into a hierarchy of sub objectives for each region, branch, department and
individual.
Bank objectives and individual objectives are integrated through Management Guide. A
Management Guide is a record of priority objectives and of the means by which the
achievement of these objectives can be measured, in such a way that the officer is
committed to take the necessary actions.
It has three main features.
 It lists the result that the job holder is required to achieve, which are agreed
mutually between him and his superior as having a major effect on job
performance. These are Key Result areas.
 Corresponding to each Key Result areas are Key Tasks which are priority tasks
identified to facilitate achievement of the Key Result areas.
 Performance standards relating to each Key Result area are also agreed upon
between the job holder and his superior.

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Setting up the system
Individual objectives contained in Management Guides are set
by discussion between supervisor and job holder. The supervisor encourages the job
holder to contribute his views and put forward what level of attainment he would consider
reasonable for the coming year. A control system is then devised to enable both the
superior and job holder to assess the job holder achievement compared with his objectives
at intervals sufficiently frequent for timely actions to be taken to deal with major variances
from objectives.
Review meeting
At the review meeting, a formal review is carried out to analyze the
job holder’s achievements for the year and the reason for any major variances from the
year’s objective. New objectives, in accordance with the cyclical planning routine, are
agreed upon. Because branch dispersion creates problem of personal communication. Such
a review meeting provides a frequent opportunity for the superior to give personal
leadership.
In short term, appraisal system serves as the basis for remuneration based on performance.
In the long term, appraisal system serves as the basis for planning managerial succession.

Performance Appraisal in NBP

Performance Appraisal in National bank is based upon the
following.

Appraisal by Objective (ABO)

Results / achievements of individual employee (Direct

report) are compared with the respective targets / objectives mutually agreed upon in the
beginning of the year between the supervisor (Appraiser) and the employee (Appraise).
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Appraisal by Ability (ABA)

The ABA process is concerned with subjective evaluation

of Abilities based on Key factors like job knowledge, Communication Skills,
Interpersonal effectiveness, initiative and flexibility. The ultimate objective of appraisal
system is to bring pay for performance culture in the process or organizational
development.

Appraisal interview

Appraisal interview is taken by the department head only.

Progress report is in the hands of the department head. Yearly appraisals of employees are
done within June-July. Appraisals are done yearly but they can also be done at any time
of the year by the department head on the basis of employee’s marvelous performance.

Performance Appraisal methods used at NBP are:

•Graphical Rating Scale

•360 degree Feedback

Graphical Rating at NBP

Through the graphical rating scale the head of the

department rates the person according to the performance of his work, skill, knowledge,
experience and also on his performance in the training programs. After the assessment
according to the rating scale he rates the employee.

360 Degree Feedback at NBP

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 Upward feedback is done by 360 degrees i.e.
information is collected “all around” an employee from his or her supervisors,
subordinates, peers and customers. Subordinates can appraise their seniors.

Compensation and Benefits

Employee Benefits

National Bank of Pakistan benefits program is designed to

attract, energize, reward and retain talented people who will produce superior business
results and enhance their leadership position. They recognize the importance of a strong
benefits program.

Benefit Categories

For National Bank of Pakistan employees at corporate,

division and region offices there are many benefits as:

•Medical and hospital facilities

•Free furnishing on having new home (managerial level)

•Provident fund

•Company vehicles are provided to employees

•Choice to get new car after five years

•Umrah packages are offered to employees

•Leasing facilities are provided to buy cars, motorbikes, etc

•Picnics are arranged once every quarter

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Training & Development

Employee Orientation

Employee orientation provides new employees with basic

background information they need to perform their jobs, such as information about
company rules. National Bank Ltd has a well planned training program for management
trainees, it develops a creative facilities of trainees and orienting them to the practical
aspects of banking i.e.The trainees are familiarized with the past history of
the organization, its activities, its work and offices its products and its
people. During their training they are sent to branches to acquaint
themselves with practical knowledge and experience.

Orientation Schedule

Training

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 The employees are given training in the “Training Room” in
the form of lectures. Firstly the employee is given the on-job training
and then he/she is given the actual task to perform. NBP arranges
summer crash courses for the employees. Job Rotation is done within
the specific departments and not outside the departments.

Training Techniques

The different training techniques used in National Bank Of

Pakistan are explained below.

Apprenticeship Training
On the job Training
Training as a continuous process

Apprenticeship Training

It usually involves assigning new employees to

experienced workers or supervisors who then do the actual training.

On-the-job-training

Group discussions seminars and case sessions are

important and a must for the trainees to participate and it is a continuous process. The
training period is for nine months and those who excel in the training are rewarded with
advance increments, which motivate the trainees to do their best.

Training as a Continuous Process

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 In NBP training is a continuous process. The changes in
attitudes, behavior, leadership style and other individual trait do not come in a day or a
week. The desired results in this direction are achieved gradually. The effects of training
programs and participation in outside courses and seminars are to be judged over a period
of time.

The management is well aware of the fact that training is an essential

part of human resource development in progressive institutions. At the end of 2005, 7353
employees (i.e.0.33% of total head count) were given extensive training in process,
products, marketing and selling skills introduced with the assistance of American Institute
of Bankers, Lahore University of Management Sciences and National Management
Center.

National Bank of Pakistan is a large organization with many employees working in

different departments of the bank.
In National Bank of Pakistan there are different types of development plans for
management for e-g MDP 1, MDP 2 , MDP 3 and CLDC (Crew Leader Development
Course).
There are also development programs for the low level jobs for enhancing the skills of the
employees.

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