HUMAN RESOURCE MANAGEMENT

Term Report

SUBMITTED TO: Mrs. Aamna Yousuf SUBMITTED BY: Sadiya Azhar Komal Riaz Mahak Sarwar Hira Alavi Khadija Hasan HRM Section D DATE: January 4th, 2012

LETTER OF ACKNOWLEDGEMENT

January 4, 2012 Dear Readers, We would first like to thank the Almighty Allah for giving us the strength and endowing us with the privilege of completing our report. We are also extremely thankful to our mentor and guide Mrs. Amna Yousuf for her constant support, encouragement and guidance, without which we could not have successfully achieved our task. We would also like to thank our family, friends and course fellows who spared their valuable time to help us and provided us the guidance to finally come up with this report. Sincerely, Sadiya Azhar Komal Riaz Mahak Sarwar Hira Alavi Khadija Hasan

LETTER OF TRANSMITTAL
Mrs. Amna Yousuf Course Instructor, Human Resource Management, Institute of Business Management, Karachi. Respected Maam, We have pleasure in submitting the report on HR Policies and Procedures of BARI TEXTILE MILLS PRIVATE LIMITED which is the course requirement of Human Resource Management, has been prepared according to the guidelines and requirements. We have tried our best to utilize as many resources as possible in preparing this report. We hope that you will find this report complete and interesting. We will be more than glad to respond to your queries that you might have regarding our report. Sincerely, Sadiya Azhar Komal Riaz Mahak Sarwar Hira Alavi Khadija Hasan

EXECUTIVE SUMMARY
The aim of this report was to provide an analysis and evaluation of the HR department functions in two different organizations in order to gain an insight on effective working and the implementations of HR department functions. We took Faysal bank and HBL for our study and we analyzed and evaluated the Training and Development system and the Performance Appraisal system in these two banks. The main purpose of this report is to analyze and contrast these major systems and their functionality in both the banks. According to our findings, Faysal bank was found to be more efficient in terms of its Performance Appraisal system and Training and Development system as compared to HBL. Faisal bank uses efficient training techniques and provides in-house and out-house training to employees which is according to the requirement of the job. They carry out a complete training need assessment in order to recognize the gap in the skills and competencies. Their Performance Appraisal system is effective and the employees are assessed according to their performance. 360 degree evaluation is done which provides a better evaluation from all sides of the organization. They have good salary packages and they use performance based pay. On the other hand, HBL has more problems and deficiencies. The major problem is found in its Performance Appraisal system. There is a lot of favoritism in promotions and the top management and supervisors use their authority unfairly and provide compensation to employees whom they prefer. There is no set criterion to compensate on the basis of performance. This de-motivates the employees and decreases their productivity. There is no system of 360 degree evaluation. The career paths are not clearly defined to the employees. Subjectivity is emphasized rather than objectivity. Moreover, HBL lacks in performance quantification methods. The pay scale difference among the different hierarchal levels is another problem that causes de-motivation among the employees. The overall low morale of the top management is affecting the productivity of the employees. Overall the complete analysis of the HR functions of both the banks showed potential problems. However, the problems faced by Faysal bank are comparatively less severe as compared to the problems faced by HBL. HBLs Performance Appraisal system is far less efficient and ineffective as compared to Faysal bank and that is the major cause of decrease in moral status and productivity of the employees of HBL.

Contents
EXECUTIVE SUMMARY .................................................................................................................................. 4 INTRODUCTION ............................................................................................................................................. 5

TRAINING AND DEVELOPMENT................................................................................................... 6 PERFORMANCE APPRAISAL REVIEW ........................................................................................... 7

HUMAN RESOURCE POLICIES OF FAYSAL BANK LIMITED .......................................................................... 10 HISTORY ...................................................................................................................................................... 10 PROCESS OF TRAINING & DEVELOPMENT AT FAYSAL BANK ...................................................................... 12 PERFORMANCE MANAGEMENT & APPRAISAL AT FAYSAL BANK ............................................................... 14 HUMAN RESOURCE POLICIES OF HABIB BANK LIMITED ............................................................................ 22 HISTORY ...................................................................................................................................................... 22 TRAINING AND DEVELOPMENT PROCESS AT HBL ...................................................................................... 24 PERFORMANCE MANAGEMENT & APRRAISAL AT HBL ............................................................................... 29 CONCLUSION............................................................................................................................................... 34 RECOMMENDATIONS ................................................................................................................................. 36 APPENDIX .................................................................................................................................................... 37

INTRODUCTION

TRAINING AND DEVELOPMENT:

In the field of human resource management, training and development is the field which is concerned with organizational activity aimed at improving the performance of individuals and groups in organizational settings. It has been known by several names, including human resource development, and learning and development. Training and development encompasses three main activities: training, education, and development.

Training: This activity is both focused upon, and evaluated against, the job position that an individual currently holds. Training is a short-term activity provided to the individuals in order to enhance their abilities and competencies according to the job requirement so as to increase their performance efficiency. Education: This activity focuses upon the job positions that an individual may potentially hold in the future, and is evaluated against those jobs. This activity is done in order to create awareness among the employees about the job they have to perform and the on-the-job behaviors they are required to exhibit. Development: This activity focuses upon the activities that the organization employing the individual, or that the individual is part of, may partake in the future, and is almost impossible to evaluate. Development is a long-term program undertaken by organizations to prepare employees for the future.

The "stakeholders" in training and development are categorized into several classes. The sponsors of training and development are senior managers. The clients of training and development are business planners. Line managers are responsible for coaching, resources, and performance. The participants are those who actually undergo the processes. The facilitators are Human Resource Management staff. And the providers are specialists in the field. Each of these groups has its own agenda and motivations.

Typical Reasons for Employee Training and Development

Training and development can be initiated for a variety of reasons for an employee or group of employees, e.g.

When a performance appraisal indicates performance improvement is needed To "benchmark" the status of improvement so far in a performance improvement effort As part of an overall professional development program

As part of succession planning to help an employee be eligible for a planned change in role in the organization To "pilot", or test, the operation of a new performance management system To train about a specific topic

PERFORMANCE APPRAISAL REVIEW:

Evaluating an employees current and past performance relative to its performance standards is called performance appraisal. A process that consolidates goal settings, performance appraisal, and development into a single common system to ensure that employees performance is according to companys aims is called performance management.

A performance appraisal, employee appraisal, performance review, or (career) development discussion is a method by which the job performance of an employee is evaluated (generally in terms of quality, quantity, cost, and time) typically by the corresponding manager or supervisor.[2] A performance appraisal is a part of guiding and managing career development. It is the process of obtaining, analyzing, and recording information about the relative worth of an employee to the organization. Performance appraisal is an analysis of an employee's recent successes and failures, personal strengths and weaknesses, and suitability for promotion or further training. It is also the judgment of an employee's performance in a job based on considerations other than productivity alone.

Aims
Generally, the aims of a performance appraisal are to:

Give employees feedback on performance Identify employee training needs Document criteria used to allocate organizational rewards Form a basis for personnel decisions: salary increases, promotions, disciplinary actions, bonuses, etc. Provide the opportunity for organizational diagnosis and development Facilitate communication between employee and employer Validate selection techniques and human resource policies to meet federal Equal Employment Opportunity requirements. To improve performance through counseling, coaching and development.

FAYSAL BANK AND HABIB BANK LIMITED:

We visited Faysal Bank and Habib Bank and asked the HR people about their training practices and appraisal methods. We asked them about their training and performance appraisal methods and techniques which they employ in their respective organizations. We analyzed their employed methods and compared and contrasted them in order to ascertain which banks methods were better and how and which bank had shortcomings in two of the HR practices aforementioned. At Faysal Bank we met Executive Vice President Khurram Ali Pasha and Senior HR business Partner Rabia Salahuddin, who facilitated us by providing us with the necessary information. At Habib Bank we met Senior Manager and Member of Strategic HR Team, Mr. Adnan Rehman, who enlightened us regarding the training and appraisal methods applied at his organization. After the comparison of the training and performance appraisal methods of both banks, we evaluated the findings and came up with important recommendations for both banks to improve their training and performance appraisal systems.

HUMAN RESOURCE POLICIES

Of

Faysal Bank Limited

HUMAN RESOURCE POLICIES OF FAYSAL BANK LIMITED

HISTORY
Faysal Bank started operations in Pakistan in 1987, first as a branch set -up of Faysal Islamic Bank of Bahrain and since 1995 as a locally incorporated Pakistani bank under the present name of Faysal Bank Limited. On January 1, 2002, Al Faysal Investment Bank Limited, another group entity in Pakistan, merged into Faysal Bank Limited which resulted in a larger, stronger and much more versatile institution. In fact it has the highest share capital amongst private banks in Pakistan and is amongst the largest in terms of equity. Faysal Bank Limited is a full service banking institution offering c o n s u m e r , c o r p o r a t e a n d investment banking facilities to its customers. The Banks widespread and growing network of branches in the four provinces of the country and Azad Kashmir, together with its corporate offices in major cities, provides efficient services in an effective manner. FAYSAL BANKS VISION: Excellence in all that we do FAYSAL BANKS MISSION: Achieve leadership in providing financial services in chosen markets
through innovation.

FAYSAL BANKS VALUES:

Our daily code of conduct is exemplified by eight core values: Four threshold values values at the heart of our brand. Four differentiator values values that set our brand apart.

Threshold Values
Teamwork We function as a team. Within functions, we cooperate. Between functions, we collaborate.

Differentiator Values
Passion We bring zeal and enthusiasm for banking to work. We are excited to provide customers with the

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Together, we aim for excellence and leadership in our chosen markets. Our Team: Our Asset. Respect We hold our customers, investors and regulators in high esteem. We uphold our customers rights to demand efficient service. We appreciate and respect our profession and, above all, our bank. Our Respect: Our Duty. Integrity We are recognized by our reliability, credibility and character. We believe in ethical, honourable, time-proven principles of uprightness. We stand for and abide by honesty, truth and transparency. Our Integrity: Our Identity. Professionalism We are proficient and efficient in all that we do. We provide banking services knowledgeably and skillfully. We uphold regulatory obligations. Our Professionalism: Our Competence

best or the best-suited. We go the extra mile in legitimate, acceptable ways. Our Passion: Our Worth. Innovation We pioneer novel and more efficient ways to deliver solutions. We are dedicated to a culture of improvement and modernization. We stand for originality, in thought, in action and in belief. Our Innovation: Our Strength. Responsiveness We are receptive to the need for change and improvement. We are proactive and anticipate our customers needs and wants. We act quickly to modify, adjust or prepare for new realities. Our Responsiveness: Our Distinguisher.

Compassion Our concern for our colleagues, our customers, our communities, and our country sets us apart. To each other, we are a family. For each other, we are a meaningful source of shared humanity. Our Compassion: Our Gift.

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PROCESS OF TRAINING & DEVELOPMENT AT FAYSAL BANK

After the selection of employees, the process of training starts. We will discuss the training of prospective and current employees of Faysal Bank.

Job Rotation:
To rotate the employees from one job to another within same departments to enhance his experience for increased job duties. In Faysal Bank there are no specific criteria for job rotation. It depends upon the will of Branch Manager whether to rotate the employee or not. (Interdepartmental Transfer)

Coaching:
Initially the employees are selected as MTOs ( Management training Officers).They are provided with necessary training relevant to their job in specific branches as directed by regional office. On job training is also provided to the employees. Permanent employees are trained with respect to certain changes in banking system and its policies such as installation of new software, change in pattern of transaction, change in government policies etc. this helps the employees in getting knowhow related to the use of new softwares and machines, new transaction techniques, and complying with changing government regulations.

Apprenticeship:
Fresh graduates and master degree holders of reputed institutes are invited to get training regarding operations of a particular organization against a little reward. Faysal Bank also has an attractive offer for fresh graduates and master degree holders to get apprenticeship. This offer contains attraction as a reward of Rs.750 per week and if performance is upto the mark then an offer for permanent employment opportunity is made.

Training and Learning Centre:

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From 2 years now, Faysal bank has opened a new branch at Zamzama commercial block where they hold their training sessions. The training head of that branch is Mr. Khurram Ali Pasha. Both in-door and out-door training is provided. The training is given to both new employees as well as managers who have been working with the same managerial style.

General Benefits from Employee Training and Development

Create employee confidence and loyalty by inspiring teamwork Increase awareness of employees skills Identify ones own limitations in a safe and controlled environment Develop contact with all levels within your organization The ultimate mix of fun, learning and elation

Conversely, the immediacy of training and development is the ability to change training methods or facts shown to be incorrect, and to change them before adverse work situations occur. It is important to consider employee reactions. Some workers may respond positively to change, while others, often fearing the unknown are resistant. Training and development in the workplace means familiar territory for employees and also familiar surroundings for instructors. When training and development result in better outcomes, employees tend to display a greater sense of ownership and pride in their work. This can help lead to increased productivity and efficiency, and of course, an increase in job satisfaction. Staffs that are happy in their work are more likely to work harder and be more valuable to the company, which will in return, put the company in a stronger position. Faisal bank is striving hard to achieve this end. Although there is always scope for improvement yet Faisal bank provides both in-door and out-door training to new as well as existing employees. The training is related to their work and their area of expertise and therefore it is easier for them to adapt themselves to new changes. This increases motivation to work which in turn increases productivity and performance efficiency.

How do we know that an employee needs training?

Through Training need Assessment (TNA) A Training Need Assessment (TNA) is used to assess an organizations training needs. The root of the TNA is the gap analysis. This is an assessment of the gap between the knowledge, skills and attitudes that the people in the organization currently possess and the knowledge, skills and attitudes that they require to meet the organizations objectives. Faysal bank carries out an effective Training need Assessment activity in order to analyze the areas which require improvement and

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training. This helps in overcoming the lack of skills, knowledge and competencies as once the training need is analyzed then training can be provided accordingly.

PERFORMANCE MANAGEMENT & APPRAISAL AT FAYSAL BANK

Salary:
There are two ways of salary setting in Faysal Bank: - If bank approaches to any experienced employee then pay will be set on the will of employee - If the candidate approaches to Bank then Bank Manager negotiate for salary. Bank will pay Rs.10,490 to fresh candidates. It includes 66.67% of basic salary. -Add 40% Basic Salary is house rent. -Add 10% of Basic Salary is Utility Allowance. Salary is not provided according to Rank but Salary is according to performance and target achievement. This means that Faysal bank uses performance based pay to compensate the employees. Whole or a part of the salary of the employees is subject to accomplishment certain performance or achievement. Lets have a view on salary of different employees. Branch Manager Rs. 78600. Operational Manager Rs. 42500. Customer service in charge Rs. 20900. Cash in charge Rs. 35000. Branch Accountant Rs. 16000

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Probation Period: It is specific time period for new employees. They do not become permanent employees once they are hired. They are hired provisionally and are put on probation till they became worthy of occupying a permanent post in the organization. In this period organization can fire at any time on the basis of poor performance. Faysal Bank initially selects the new employees on the probation period of six months. Promotion Criteria: In Faysal Bank Branch Manager is responsible for promoting the employees on the basis of their performance. Two promotion Criteria are used: 1) Performance Basis 2) Without Performance

Performance Basis:

There is no set criterion for promotion even on the basis of performance. One can be promoted to OG0 to OG1 grade within 3 months if his/her performance is outstanding.
Without Performance:

It is the policy of Faysal bank that even if the employee, who has served for 3 consecutive years, but did not perform well, then he is eligible for promotion. Pension: No pension is given as it is a private bank. Only gratuity fund is provided at 10% of basic salary per month which is contributed by employee and an equal amount is contributed by employer. At the time of retirement both amounts along with interest is paid to the employee.

Vacation Criteria: Faysal Bank provides an annual leave of 42 with pay which includes: - 6 sick leaves - 6 causal leaves

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- 15 recreation leaves -15 privilege leaves

Transfer: If an employee is periodically employed outside the town and the branch is being opened in the home town of the employee then he is transferred to the home town branch. In case of any shortage, employees are also temporarily transferred. Performance Appraisal: To compare the employees current and past performance with their standards is known as Performance Appraisal. Faysal Bank follows the traditional appraisal method which is done on yearly basis. Branch Manager of Faysal Bank appraises from Sweeper to Operational Manager and Branch Manager appraises all the employees by taking direct instructions from his/her respective head. Appraisal for Branch Manager is done by Area Manager of Faysal Bank.

Man to Man Comparison: In this method performance of employees is determined on certain factors like initiative taking ability, leadership and other personal qualities which are compared with another employee.

Forced Choice Method: In this method two options are given to the rater and the rater must choose one of them to rate employees behavior. For example [Question: Is he loyal? Ans: (i) Yes, (ii) No.]

The upper management sets target for Areas and their Managers. The job of the Area Manager is to compete and strive to get that target. On achieving those targets they get

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rewards. Currently, Branch assurance policy was the criteria on which sales were made at Faysal Bank. Each Areas were given targets and then those targets are divided Branch wise. The Branch managers then distributed the target to the individual employees. For Branch the reward was that the individual employee who achieved targets and did it first qualified for the free trip Faysal bank took the employees to. For example they took them to Turkey, Malaysia, Srilanka and etc. for the area that achieves the overall target, the area manager gets a chance to go on a free destination trip. Each employee is given a target half yearly and the increment and promotions are also done on half yearly basis. The behavior is monitored by the Branch Managers and then appraisal forms are filled mentioning each employees overall performance and then that form is sent to HR department. Appraisal Interviews: Every Branch Manager conducts an interview with the branch employees who have performed upto the mark. They discuss the half yearly jobs and performances and how they should be rated for that time period. In this way the employees can tell how they feel about the appraisal and why they think that they are capable are eligible for a reward. Also the Manager convinces the employees if they do not get good appraisals. They tell them the reasons and give them assurance that next time if they perform above the mark, they will be appraised. The main criteria of performance appraisal at Faysal Bank are fulfillment of targets and bringing business to the bank.

Below are the two forms used at faysal bank. Employee Conversation And Planning Map is used by employee and submitted to brand manager. A feedback interview is taken. On the basis of all the information gathered by brand manager, Performance Conversation And Planning Map is filled by him. Then both of these forms are submitted to HR department for further processing. Then the employees are dealt with accordingly. Either the employees are sent for training, or given bonuses and rewards or warnings, whatever is needed.

Following factors are considered while filling the two forms: Strengths: Include 2 - 5 areas of strength, describe supporting examples (be specific), identify the positive impact (show the employee how the strength adds value) and connect the strength to a competency (you should develop 6 - 8 performance competencies that describe expected performance and behavioral standards in your organization).

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Areas for Development: Include 1 - 3 areas for growth for this individual. Think about the one area that if developed would have a positive impact on the employee's future contributions. Describe what it is you want to have happen. Describe the specifics (what would it look like). Describe why developing this performance area is important/how it will add value. Connect the area with a performance competency. Goals: Areas for development should be translated into goals that are SMART (Specific, Relevant, Attainable, Relevant, Time-Bound). Review Previous Goals/Objectives: Create an area to review past goals and objectives. Use your judgment for where this should be placed on your form. Most likely you will want to review this first. Be sure to update the goals when objectives and work priorities change. With the pace of change in the workplace today goals can get stale quickly!

EMPLOYEE CONVERSATION AND PLANNING MAP

Looking Inward
Work interests: Thinking about your responsibilities, list the 3 5 tasks you most prefer to do: My top 2 strengths

My 1-2 areas for growth and development

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Looking Outward
Trends: What is coming up in my area that might influence my development and future contributions? How can I contribute?

Looking Forward
Questions I would like to ask my manager: Examples: a.) What do you consider to be my top strengths b.) What would be the highest payoff area for growth/ development? Other Questions: Ideas for job enrichment or other interests: possible development options and ideas I have thought of:

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Id like to formally meet with my manager ____ times per year.

PERFORMANCE CONVERSATION AND PLANNING MAP

Employee Name: Manager: Position: Date

STRENGTHS:

Area of Strength

Examples

Impact

Related Competencies

AREAS FOR GROWTH AND DEVELOPMENT

Area for Growth and Development Develop the ability to..

Specifics/Details

Importance

Related Competencies

GOALS Translate Areas for Growth and Development into Goals.Consider if on the job or external training is required to successfully meet the Goal (training should be reflected as a goal). Goals Milestones (the smaller steps required to meet the overall goal) Measurement Time Frame

Check in Date:

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Check in Date: Check in Date:

Managers Signature: ________________________________________ Employees Signature: _______________________________________

HUMAN RESOURCE POLICIES

Of

Habib Bank Limited

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HUMAN RESOURCE POLICIES OF HABIB BANK LIMITED

HISTORY
HBL was the first commercial bank to be established in Pakistan in 1947. Over the years, HBL has grown its branch network and become the largest private sector bank with over 1,480 branches across the country and a customer base exceeding five million relationships. With respect to recent developments, HBL closed 14 branches in 2009 and opened seven in 2010. Market share of HBL is 40%. The Government of Pakistan privatized HBL in 2004 through which AKFED acquired 51% of the Bank's shareholding and management control. HBL is majority owned (51%) by the Aga Khan Fund for Economic Development, 42.5% of the shareholding is retained by the Government of Pakistan (GOP), whilst 7.5% is owned by the general public i.e. over 170,000 shareholders following the public listing that took place in July 2007. With a presence in 25 countries, subsidiaries in Hong Kong and the UK, affiliates in Nepal, Nigeria, Kenya and Kyrgyzstan and rep offices in Iran and China, HBL is also the largest

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domestic multinational. The Bank is expanding its presence in principal international markets including the UK, UAE, South and Central Asia, Africa and the Far East.

HBL is the second largest bank in the country with a market share of Rs 460 billion in advances and Rs 747 billion in deposits, after the NBP, which has a market share of Rs 508 billion in advances and Rs 832 billion in deposits.

Key areas of operations encompass product offerings and services in Retail and Consumer Banking. HBL has the largest Corporate Banking portfolio in the country with an active Investment Banking arm. SME and Agriculture lending programs and banking services are offered in urban and rural centers.

HBLS VISION: Enabling people to advance with confidence and success HBLS MISSION: To make our customers prosper, our staff excel and create value for shareholders HBLS VALUES: HBL values are the fundamental principles that define HBL culture and are brought to life in HBL attitudes and behavior. It is HBL values that make them unique and unmistakable. HBL values are defined below: Excellence: This is at the core of everything HBL do. The markets in which HBL operate are becoming increasingly competitive, giving HBL customers an abundance of choice. Only through being the very best - in terms of the service HBL offer, HBL products and premises - can HBL hope to be successful and grow. Integrity: HBL is the leading bank in Pakistan and HBL success depends upon trust. HBL customers - and society in general - expect HBL to possess and steadfastly adhere to high moral principles and professional standards. Customer Focus: HBL understand fully the needs of HBL customers and adapt HBL products and services to meet these. HBL always strive to put the satisfaction of HBL customers first. Meritocracy: HBL believe in giving opportunities and advantages to HBL employees on the basis of their ability. HBL believe in rewarding achievement and in providing first-class career opportunities for all.

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Progressiveness: HBL believe in the advancement of society through the adoption of enlightened working practices, innovative new products and processes, and a spirit of enterprise.

HBLS CULTURE: HBL have created a challenging environment that encourages creativity and commitment. In pursuit of excellence, HBL is focused on attracting, developing and retaining the best talent in the marketplace. HBL dynamic culture offers diverse growth opportunities across Pakistan and in 25 countries around the world.

HBL fosters a work environment where employees can realize their potential whether locally or in the international arena. Thus, HBL enable its employees to achieve their professional goals while keeping in synch with the banks overall objectives. Human Resource supports every centre; operations and retail through three Relationship Managers; North (covers branches from Islamabad to the Northern areas of Pakistan), South (covers Sindh and Balochistan) and Central (covers Punjab). HBL is transforming in last 10-25years. The transformation speed is fast because of the high level of commitment of the top management. The whole IT system is changed. HBL have adopted Misys Software (Automation of service provision and book management) in 1,480 branches.

HRM Structure The HRM department plays an important role in value of any company. HBL has very active and one of the best HR department in Pakistan as well as worldwide. The total staffing as per 2010 balance sheet figures is 13,265. Employee head count in 1997 was 31000 employees and now it is 13, 265. HR focuses on talent acquisition and talent retention.

TRAINING AND DEVELOPMENT PROCESS AT HBL

Training is the process of teaching new employees the basic skills they need to perform their jobs and development is result of that training. Every department has Individual Development Program (IDP). Stress and time management training sessions are given to those employees who want to take it.

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For training and developing HBL follows five steps process of training and development

Needs analysis: Identify job performance skills needed, assess prospective trainees skills, and develop objectives. Instructional design: Produce the training program content, including workbooks, exercises, and activities. Validation: Presenting (trying out) the training to a small representative audience. Implement the program: Actually training the targeted employee group. Evaluation: Assesses the programs successes or failures.

After analyzing the main tasks required in performing jobs it is verified that there is a performance deficiency and determining whether that deficiency should be corrected through training or through some other means (such as transferring the employee). If there is found some deficiency in performing job then training is highly recommended to overcome deficiencies.

Training Methods used by HBL: 1. 2. 3. 4. 5. On-the-job Training Off-the-job Training Apprenticeship Training Informal learning Effective lectures

1. ON-THE-JOB TRAINING: Having a person learn a job by actually doing the job is OJT. Methods of OJT are Coaching or understudy Job rotation Special assignments Action Learning

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Coaching or understudy: It is the OJT method in which employee is coached and taught by profession that how to do the job in order to meet HBLs goals and objectives. At managerial level the trainee works directly with a senior manager or with the person he or she is to replace; the latter is responsible for the trainees coaching. It is done at all levels of job. New employees are trained through coaching and old employees are also trained through this method like when some new innovation is introduced old employees are trained in order to handle that new innovation. In 2008 all managers have been trained to operate Misys Software (Automation of service provision and book management). Job Rotation: Moving a trainee from department to department to broaden his or her experience and identify strong and weak points. Job rotation is usually done at managerial level. HBLs Manager Associate (MA) program is used for job rotation training. Special Assignments: Special assignments are also given to employees for special training. These assignments are actually related to tasks within the branch by achieving those tasks assigned by trainer, employee get training. Action Learning: Management trainees are allowed to work full-time analyzing and solving problems in other departments. This OJT method is just for managerial level employees.

2. OFF-THE-JOB TRAINING: It is the method which is opposite to the OJT. In this method employee does not get training at his/her work place. This method of training is only for managerial level employees. Offthe-job training methods are Case study method Outside seminars

Case study methods: special case studies are given to employees which contains some dilemma about banking sector. By solving those case study problems employee gets training to take bold and effective decision in crucial situations. Outside seminars: HBL encourages its employees to participate in the seminars arranged by banking sectors not just in the Pakistan but also beyond the borders. By participating in outside seminars, employee gets authentic knowledge about the new horizons of banking sector which is useful for HBL and makes it leading bank in Pakistan.

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3. Apprenticeship Training: A structured process by which employees become skilled, using a combination of classroom instructions and on-the-job trainings is known as Apprenticeship Training. It is actually combination of OJT and lectures delivered to employees. It may be for both the levels; managerial and fresh employee. In this method employee is first given the lecture about his/her job and after that implementation of lecture in practical field is observed.

4. Informal Learning: The majority of what employees learn on the job they learn through informal means of performing their jobs on a daily basis. HBL believes in learning through actual on-the-job performance.

5.Effective Lectures: Lectures about jobs are also delivered. These lectures are delivered to new employees as well as senior level employees and managerial level too. In these lectures employees are prepared for facing new challenges in the banking sectors and are also told how to achieve those challenges.

SUCCESSION PLANNING AT HBL: It is actually management development program. Management development is an attempt to improve current or future management performance by imparting knowledge, changing attitudes, or increasing skills. In order to achieve management development, succession planning is done. Succession planning is a process through which senior-level openings are planned for and eventually filled. Succession planning is for first two tiers-SVP and EVP. HBLs Management Trainee (MT) program deals with succession planning.

Training and Development Programs at HBL: HBL uses following programs for training and development Management Trainee

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Management associate Cash officers Internships

Management Trainee: HBLs Management Trainee (MT) program looks for highly motivated individuals who exhibit the potential to excel as future leaders. The program is geared towards providing challenging work assignments complemented by a learning component for select individuals from reputable universities. At HBL, the MT program offers extensive interactive classroom training, on the job rotations and personal mentoring from senior management to provide a comprehensive learning experience. The objective of the program is to realize potential and translate the experience into a successful banking career. Job Rotation is done. Management Associates: HBLs Management Associate Program is a training and rotational program focused on dealing with branch banking requirements. It provides accelerated development opportunities across HBLs branch network of Retail, Corporate & Commercial banking. During this program, candidates are assigned with challenging business scenarios to enhance their critical and analytic skills. Another crucial element of the program ensures that managerial skills are honed and developed. This provides associates with the expertise required to handle supervisory and administrative tasks that will result in the development of successful business managers. Retail Banking Officers (RBO) or Management Associates are hired from the second tier universities such as Hamdard University and Bahria University. Cash officers: HBLs Cash Officers Program catapults successful candidates to the front lines of the bank. Candidates in this program are the banks ambassadors and must have exemplary skills in dealing with clients. The program involves an extensive one to two-month off the job training period based on branch banking operations before placement in the branches. Energetic and focused graduates from HEC recognized institutions with good communication and interpersonal skills qualify for HBLs Cash Officers Program. Before being placed at HBL branches, these individuals must exhibit a proven ability to add value and act as agents of change. Internships:

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HBLs Internship Program offers promising students with the exciting opportunity to apply their classroom learning experience to real life corporate assignments. Through the program, internees can support their career goals by using the internship as a launching pad for creating contacts with professionals in the field and identifying their own competencies to build a successful career with HBL.

PERFORMANCE MANAGEMENT & APRRAISAL AT HBL

At HBL growth is not a function of time but rather of performance. As employee performance improves, the role that employee plays within the organization will accelerate to reflect employees input. HBL generally uses BARS (Behaviorally anchored rating scale) it is an appraisal method that uses quantified scale with specific narrative examples of good and poor performance. HBLs performance management and reward systems ensure that goals are met in an effective and efficient manner. HBL defines a clear path for the employee to contribute to the organizations overall goals, peppered with regular reviews and feedback to help employee gauge their progress. HBL generally uses Bell Curve in which three categories; A, B and C is allotted. A represents 16%, B represents 15% and C represents 14%. For example HBL have set a midpoint of 1.5lac rupees salary. If an employee performs above than the midpoint and he performed well then he will be given 16% increment in his salary (i.e. 2lac rupees). And if he performed better but not good then he will be given 14% increment in his salary (i.e. 1lac rupees). And if the employee performed at the midpoint then there will be no increment in his salary other than the allotted percentage (i.e. 1.5lac rupees, which is the 15% increment). ACR was replaced by the Performance Management System (PMS) in 2006. ACR stands for Annual Confidential Report. This is an annual assessment report of subordinate staffs maintained by Human Resources Department.

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Feedback was improved. PMS circulars are pasted on the board. New Human Resource Committee is assigned each year, which reviews and approves the policies. Performance appraisal is done annually. (i.e. cycle is from January to December) 8-10 pages circular is issued. The circular is provided in the Appendix A.

Performance Appraisal Form of HBL: HBLs performance appraisal form contains two sheets, one is FORM B2 and other is FORM B3. FORM B2 FORM B2 contains appraisal for Clerical staff at branch or Field Offices. There are two main headings Area/factors and level of achievement points. Level of achievement point contains five points ratings A (4), B (3), C (2), D (0-1) and N/A. AREA/factors contains five kind of factors which are A-Productivity B-Individual \attributes C-Technology D-Customer Service E-Personal Each area is further categorized in different factors. Each factor is marked tick against level of achievement and in the end total points scored is written in the specific box. Also the signatures of appraisee and appraiser are taken.

FORM B3: This form contains two big boxes. First box is about Development Plan/ Supervisor comments. In this box supervisor gives comments about appraisee strengths and further appraisees development needs (need to improve academic & professional qualification).

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Second box is called overall assessment box. In this box appraiser gives the overall performance grade to appraisee according to B2 form and the grade is given in form of A, B, C, D. Then comments of appraisee is also taken in form of agree/disagree. Then overall assessment is reviewed by reviewer and reviewer gives its comments too, but it is not necessary. After it final acceptance of appraisee is also taken along with signatures. Performance Appraisal Review at lower level is done by Supervisors while Supervisors PAR is done by Branch Manager and Branch Managers appraisal is done by Area Managers and then Area Managers are appraised by Regional Managers. At regional level responsibilities are given instead of authority, which is affecting promotion policies and performance evaluation practice.

COMPENSATION: The salaries, rewards, bonuses, and incentives on the basis of job and performances are compensations. Compensation may also be used as a reward for exceptional job performance. Examples of such plans include: bonuses, commissions, stock, and profit sharing, gain sharing. Compensation will be perceived by employees as fair if based on systematic components. Various compensation systems have developed to determine the value of positions. These systems utilize many similar components including job descriptions, salary ranges/structures, and written procedures. The components of a compensation system include:

Job Descriptions A critical component of both compensation and selection systems, job descriptions define in writing the responsibilities, requirements, functions, duties, location, environment, conditions, and other aspects of jobs. Descriptions may be developed for jobs individually or for entire job families. Job Analysis The process of analyzing jobs from which job descriptions are developed. Job analysis techniques include the use of interviews, questionnaires, and observation. Job Evaluation A system for comparing jobs for the purpose of determining appropriate compensation levels for individual jobs or job elements. There are four main techniques: Ranking, Classification, Factor Comparison, and Point Method. Pay Structures Useful for standardizing compensation practices. Most pay structures include several grades with each grade containing a minimum

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salary/wage and either step increments or grade range. Step increments are common with union positions where the pay for each job is pre-determined through collective bargaining.

Salary Surveys Collections of salary and market data. May include average salaries, inflation indicators, cost of living indicators, salary budget averages. Companies may purchase results of surveys conducted by survey vendors or may conduct their own salary surveys. When purchasing the results of salary surveys conducted by other vendors, note that surveys may be conducted within a specific industry or across industries as well as within one geographical region or across different geographical regions. Know which industry or geographic location the salary results pertain to before comparing the results to your company. Policies and Regulations

Different types of compensation include:

Base Pay Commissions Overtime Pay Bonuses, Profit Sharing, Merit Pay Stock Options Travel/Meal/Housing Allowance Benefits including: dental, insurance, medical, vacation, leaves, retirement, taxes

COMPENSATION AT HBL: HBLs focus is on attracting, developing and retaining the best in the business by offering market driven compensation and benefits packages. HBLs compensation and benefits strategy combines the need to maintain a high performance culture along with market competitiveness. Annual benchmarking exercises are conducted to stay abreast with industry standards. According to performance each employ gets benefits and compensation. Time does not matter only performance matters at HBL. Employees are paid in two forms

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 Direct payments- Pay in the form of wages, salaries, incentives, commissions, and bonuses. Indirect payments- This mode of payment is not related to cash payments like medical, insurance, residence, car, car fuel etc.

Competitive market based salary is given and medical facility is provided to every employee. Retirement age is 60years old. Leave Pre-Retirement (LPR) is given and it is necessary to avail it Voluntary Separation Scheme (VSS) is a benefit program given to those employees who are good performers but they want to join other organization. Subsidized loans, end-service benefits (such as provident fund) and health benefits are given to those employees for retaining them. Rule 18: Whose performance is not good for two consecutive years they are given warning in 3rd year and if no improvement in 4th year they are laid off. Provident Fund For employees hired on or after January 1, 2002 and for those who did not opt for the Banks Pension scheme introduced in 1977, the bank operates an approved Provident Fund under which both the Bank and employees contribute at following rates: 6% of the Basic Salary For Executives % Officers 12% of the Basic Salary For Clerical Staff For Contractual Employees as per their Service Contracts.

The staff who are covered by the Banks Pension plan now are also eligible for the Provident Fund Benefits effective from April 01, 2005 by contributing 6% of the Basic Pay. Bank also makes equal contribution of these employees.

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CONCLUSION
Faysal Bank training and development methods are really strong as discussed in above briefing. Training and development leads to employee motivation. As they have a separate training centre at other than bank location to cater to the different needs of training of employee which helps organization to achieve their strategic objective. Training like in Faysal bank can help the organization to stick to their aim and long term objective. Also it can help them to have trained staff because then 360 degree supervision is possible. Most of the employees get motivated through trainings so they will have enthusiastic and motivated team who will be willing to work efficiently. Faysal bank does job rotation of those employees who they prefer, not according to any predefined planning or strategy which is not efficient. But overall, training and development of Faysal Bank is quite efficient and effective. At Faysal Bank, Salary is not provided according to Rank but it is according to performance and target achievement which is good for the organization. They have good salary packages for their employees. Branch Manager is responsible for making promotion which is made on the basis of performance. Also, not only the responsibility is given but the authority is

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delegated too which boost the employees morale. But the only problem is that they also have a policy to promote employees on the basis of the term they have served in the organization. In this case, they promote employees who have served for 3 consecutive years or so without any performance consideration. As compared to faysal bank, HBL has a sound and effective training system. They provide both on-the job as well as off-the job training to the employees. This ensures better productivity and enhances the skills of the employees. On the other hand, HBL need to revise its Performance Evaluation process and define clear career paths to enhance the performance of employees. Subjectivity overruling objectivity and performance quantification technique lacks in HBL. The impact of HR practices (Compensation Practice, Promotion Practice, and Performance Evaluation System) on the employee of HBL, have given us a chance to conclude that the criteria of performance quantification lacks skills & techniques which is affecting the performance of employee in HBL. The pay difference between the different hierarchical levels is a frustrated factor among the employees of HBL. Career path is not properly defined in HBL. At regional level responsibilities are given instead of authority, which is affecting promotion policies and performance evaluation practice. Delegation of authority lacks which promotes subjectivity instead of objectivity. HR department lacks professionals which are highly needed. And the low morale of upper management is affecting the overall efficiency of the employees of HBL. Compensation Discrimination is also noticed at HBL which again de-motivate the employees. At HBL, Employees are evaluated by the supervisors only; not by customers, co-workers or by themselves. So there is no 360 degree evaluation. Also, Most of the employees who were hired before privatization are not getting promotion and incentives as compared to employees hired after privatization. Appraisal, promotion, awards are based on like and dislikes of the higher management and the appraiser. The higher management give rewards as they deem fit without evaluating the worthiness on the basis of the individual performance of the employees. The former employees feel left out. The employees are de-motivated. This is creating negativity in the organization and employees are jealous of those who are being promoted on the basis of favoritism.

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RECOMMENDATIONS
HBL Performance Appraisal system has some major problems that are affecting the overall functioning of the bank. Appraisal and promotion should be based on performance. There should be no biases. The appraiser and supervisors must be given proper training to avoid such biases and favoritism. The supervisor should be trained to conduct performance appraisal properly and they should focus on performance and should not bring in between their likes and dislikes. As its a semi government organization, there is a lot of favoritism done. Many times employees who deserve the promotion dont get promoted just because theyre not the favorite ones. Compensation Discrimination should be avoided it will provide motivated employees to HBL. Eid bonuses, hospital allowances and Petrol Ceiling should also be separated from monthly Pays.

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The delegation of authority should be adopted in HBL. Objectivity should be promoted instead of Subjectivity. Performance quantification methods should be improved. The Performance appraisal forms should focus on techniques and skills. HBL need to revise its Performance Evaluation process and define clear career paths to enhance the performance of employees. Subjectivity overruling objectivity and performance quantification technique lacks in HBL. There should be less Pay Scale difference between the different Hierarchical level in HBL. Promotion Policy should be revised and should include less hierarchical level. Specialized HR Specialist should be hired at top level. HBL needs a separate HR department at regional level as well. There should be a less span of control. Faysal bank has an efficient Training and Development system. However they should improve their job rotation system but rotating the employees on the basis of some defined and planned system. It should work on improving its Performance Appraisal system more and should only give promotions on the basis of performance and not on the basis of the term served in the bank.

APPENDIX
Following is a set of questions we made in order to Interview HR personnel from both the Banks: 1. Does every employee understand competency/requirement needed to perform a job/position? 2. What is the procedure of Performance Appraisal? 3. On what basis do employees get promotion in your bank? 4. Does your bank develop attractive benefit program that can retain employees? 5. Does your bank have a clear development or training plan? 6. What is the current training and development system for employees? 7. How do you conduct Training Need Analysis (TNA)?

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8. Do managers and employees find the training program relevant to their needs? 9. What is the current compensation system in your bank? Please describe 10. Is the compensation system reviewed periodically? How do you evaluate your pay structure and compensation policy at least annually and adjust it when needed? 11. Please describe the current benefit and allowance system of your company? (Describe in detail if there is a difference among upper / middle / lower level of management / staff?) 12. Do you give constructive feedback to increase employees performance? 13. Do you capture the creative insight of employees by soliciting their ideas for improvement? 14. What mechanisms do you have for obtaining employee feedback on a regular basis?

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