Performance and HRD: A Study among Various Types of Banks

Abstract

Human Resource is considered to be very crucial in the organization's well-being. Presently organizations have started realizing that Human Resources are the most important of all assets based on the emerging values of humanization. Development is considered to be the soul of the Human Resource Management function, which reflects on the organization's effectiveness. Human Resource Development in a growing economy like India is the need of the time and undoubtedly, banking sector is the most effective instrument for India's economic development, for which developing Human Resources for this sector has become essential to achieve the national objectives. In spite of the rapid technological reformations, Human Resource remains the backbone of the organizational structure of Indian banks - which undertake the crucial responsibility of transforming its operational system into the modern one that suits to the present requirements. Since there is a dearth of studies in this area and recognizing the pivotal position of Indian banks in developing the nation's socio-economic structure, it was found necessary to empirically test the relationship or difference among the various categories of banks. This paper aims to study the extent of HRD practices in the Banking Industry pertaining to differences in Ownership and Performance. INTRODUCTION Globalization dominates the competitive horizon and entails new markets, new products, new mindsets, new competencies and new ways of thinking about business. Global competition, apart from creating product/service in home market and marketing it to new markets, requires a complex network of global centers of excellence that draw on technologies invented in one locale and shared worldwide. The rapid movement of products, people, information and ideas around the world focus on local needs and management of the paradox of global economies of scale. It requires a global mindset and a local commitment: Thinking globally but acting locally. To accomplish this ambitious agenda, organizations will have to fundamentally redefine themselves as that of a global relay team. Organizations will have to build global capabilities such as the ability to seamlessly move talent, ideas and information around the world to create products and services at an optimum pace with quality above par. They will have to build an employee infrastructure for hiring, maintaining, training and developing that takes a global perspective which is made possible through the Human Resource Development (HRD) activities (Ulrich and Lake, 1990). HRD as a concept demands a specific and congenial climate to take root. It enriches the work life in an organization and aims to link productivity with a sense of personal fulfillment. HRD involves all management decisions and practices that direct, affect or influence the Human Resources in the organization. In recent years, increased attention comes from the realization that an organization's employees enable an organization to achieve its goals and the management and development of these resources is critical to an organization's success (Schuler, 1992). With this perspective this study has attempted to examine the extent to which HRD is practiced in the banking industry and if there could be any relevance to their performance. IMPORTANCE OF HRD IN ORGANIZATIONS Economic, technological and social trends have created acute problems and challenges for business and industry and consequently focused on HRD as a key element in coping with these problems. The importance of HRD as a catalytic agent of growth has been increasingly recognized which makes necessary organizational effort to help the managers in adapting to the emerging changes of the environment (Nadler, 1984). There are many studies which show that HRD has got direct linkages to productivity and organizational performance. Huselid (1995) in study of 3452 firms representing all kinds of industries, found that good HR practices were associated with increases in sales, market value and profits. …