Malaysia as a country has made great strides due to strategic management with a strong human resource capital. It now ranks among the ten top growing countries in business success and its companies are growing and competing with other successful multinational companies in the world. According to research Malaysia is the only Asian country that features among the top ten successful super growing countries in the world that has made great success. Most of Malaysian companies satisfy these ranking because they have considerably grown and managed a good human capital which makes them to be able to compete well with other companies in the world and thus being in a better position than others. One of the leading companies in Malaysia is Public bank which serves a wider community of Malaysia and its environs fully satisfying the banking needs of the people thus making it a super company. (Haron, 1996)
The general aim of the recruitment and selection practice in and organization is to curtail the costs incurred in the process and to also get quality employees required to satisfy the human resource needs thus getting a good human capital which will foresee the success of the organization. Sparrow and Hilltop, 1994 stress that, in recruitment there should be a recruitment plan which should be followed so that the costs can be minimal. The plan should include the number and types of employees needed by the company, the qualifications they should meet for example if it should be college level, school level or further education, plan for tapping and substitute source of employees to strengthen the human capital of the company and finally how the process of recruitment should be carried out.
In recruiting the employees, the proficiency defined for a certain role in the organization is used as an outline followed in the selection of the employees for a proper human capital.
Taylor, 1992 notes that competency is used in recruiting employees and it usually bases analysis on the person rather than basing it on the job to be done. The starting point in recruitment is not analysis of the job but analysis of the people and what characters they have to perform well and achieve the goals and objectives of the organization. The advantage of putting into consideration competency in selecting employees is to identify and isolate key characteristics which would form the basis of selection
Roberts, 1997 notes that when recruiting, the human resource department should ensure that they use all the ways and tactics in order to have the best employees in the work place as the success of any firm is purely based on the strong human capital that they have. The recruitment should make sure that they analyze the performance of the people they are recruiting to work rather than concentrating on analyzing the job It is therefore very important for any organization to ensure that they recruit good high performing people to drive the organization to total success. The firm gets a lot of advantages by having the right workforce which is very competent through competence based recruitment that later leads to the success of the firm.
In my own view therefore, human resource management is a very crucial function in any modern organization that seeks to achieve its objectives. This is because people are the most important asset in any organization as compared to other assets that aid in running an organization. Firms require people and also such individuals require firms. Organizations therefore have a human principle and they are constantly created and retained on the basis of mutuality of interest amongst the contributors. People view the organizations as ways to assist them to arrive at their objectives while such firms necessitate people to complete their stated goals. For that reason, if there is no mutuality, it will not be sensible to assemble a group and develop a cooperation because there is no common base on which to build. Therefore for accomplishment of organizational efficiency, recruitment and selection process is the most vital process that must be paid much attention by the administration. Human resource has the responsibility to coordinate all the activities within the organization and they have to ensure efficiency in productivity of the organization. It is obvious that all firms in the different sectors of economy aim to gain competitive edge over their rivals by practicing recruiting the best and qualified personnel.
Background of Public Bank
Public bank in Malaysia started as a single branch in the year 1966 by its chairman Tan Sri Dato. The aim of its inception was to serve the public and it was therefore positioned to meet the banking needs of the citizens of Malaysia. It has fully grown to become a leading banking group in Malaysia. It has played a very primary role in ensuring that the life’s of the people of Malaysia and other places that they have diversified e.g. Cambodia and Hong Kong. The bank has a well trained force that stands at around 13,300 and they have helped the bank have a competitive advantage to meet its competing banks. The workers are highly motivated and are doing a great exceptional job to serve its big customer base that is growing daily. The headquarters of Public bank is in Kuala Lumpur- Malaysia. They have tried to improve all its services that are mainly banking and finance where they serve the clients with services like deposits and loans to meet the financial needs that they cannot be able to finance. (Haron, 1996)
In the end of 2005 financial year, the bank recorded a reasonable growth of RM68.1 billion in loans, RM111.6 in assets and RM84.1 billion in deposits. It is now the second biggest bank in Malaysia and has centered its services on small to medium sized enterprises and retail customer.
The subsidiaries of the public bank in the different regions have the independence to formulate their decisions so long as it is in line with the company’s overall main objectives. This has enabled decision-making processes to involve all the shareholders of the company in the respective subsidiaries. The company’s management is aware of the risks in the banking industry and has ensured that it operates closely with its customers. (Wood & Payne 1998)
Company’s Competencies and capabilities
The analysis of the environment is very crucial to the Public bank and marketing managers have the duty to up with good policies that aid the banking institution to withstand competition. With particular regard to Public bank, it has utilized environmental analysis in its management strategy. It is evident that the company has had some competitive strategies that have enabled the company to perform well in the tobacco industry. The Public bank has adopted competitive generic strategies that have enhanced the Public bank’s competitive advantage over its rivals like the Barclays bank, Standard Chartered Bank e.t.c. These competitive strategies have enabled the Public bank to create and sustain a justifiable position in the banking industry in the region. Public bank has formulated a very good competitive strategy that has enabled the Public bank to compete across the entire market which is evident in the way it has diversified to various countries. This strategy has made public bank to have a very strong brand name which helps the Public bank to have a competitive advantage over the other banking firms like the Bank Islam(l) Ltd which is trying t diversify and make their products attractive to al the customers. (Michael, 2006)
The Public bank is also credited for having the best marketing network that have made the company to do well in Malaysia and the entire region at large. The marketing operation and success of the marketing force has highly utilized the good distribution channels in the Public bank which has been a strength that has significantly helped the Public bank to dominate the market for a long time. The other competitive strategy associated with the Public bank is that it has utilized its capability to identify the market and segmenting it according to its unique needs and hence the competitive position of the public bank is considered to be high than that of its competitors and has in the process developed workable marketing strategies that has made it succeed in the banking industry and has made it rise to the second successful Banking institution in Malaysia. (Wood & Payne 1998)
Its wealth has been used to improve the services and facilities and the bank has acquired many assets that help it to serve a wide range of customers. This Public bank has got core operating units that have been developed which have helped it to have a very firm structure. Because of a strong financial base, the company has designed products by differentiation process and the products of the bank have been viewed to be unique and therefore being the main reason why there has been constant increase in profits and customer base. The growth strategies of Public bank include market penetration whereby the bank has sold existing developed products in the region to serve the dynamic needs of their customers. The Public has also embarked on market development whereby the bank has formulated strategies of expanding to new markets with existing products for example in Cambodia.
Public bank as a financial institution in regard to competencies and capabilities has embarked on a number of activities which has contributed to its success not only in the Malaysia but also in the regions that they have moved to by ensuring that they recruit skilled, well motivated and qualified staff in order to achieve good results and boost its profits. Public bank has developed clear policies, decision and regulations, a favorable environment for working, good administration, have built a system with ability to adapt to any changes, have also an efficient board of directors and have build a practical and physically powerful culture and mission among workers. (Welch, 1991)
Strength can be defined as a particular skill or distinctive competence that an organization like a bank can do relatively better than other financial institutions especially its competitors. Public Bank has a strong brand name which helps the Public bank to have a competitive advantage over the other banks in the region. The Public bank of Malaysia has a very good internal environment which allows it to deliver quality services to its wider base of customers. The bank has well developed and modernized information and technology machines which make it to serve their customers in a fast way. Its banking services are fast and efficient due to the state of the art informational technology that has helped the bank in its banking services. The bank has modern facilities that help those who use the ATM’s and credit cards and Public bank has also introduced modern internet banking to meet the fast changing needs of its customers due to globalization. With internet facilities customers can access the banking services from all over the world and this has been of great benefit to businessmen because it reduces delays that come from manual operations that are time wasting and expensive in the long run for businessmen who are busy and are far from the Public bank branches. (Michael, 2006)
The bank trains its workers to be effective so that they can possess good understanding of their work, great expertise and knowledge of their work and therefore be result oriented. The bank has achieved this through skilled training personnel’s that train the workers periodically and motivate them to give their best in the bank. The workers are also trained to have a good public relation so that they can attract their customers and also serve them better. The Public bank’s clients are proud of the bank because they are treated well at all times by the workers in the bank.
The Public bank has expanded to all major, small towns and even villages of Malaysia so as to serve the customers from all over the country. (Herzberg, & Snyderman, 1957)
Customers enjoy the good network channel that the bank has established and these has really helped it’s customers to enjoy the services of the bank even from the most remote regions in the country. Its expansions to other regions e.g. Cambodia and Hong Kong has made it easy for businessmen of Malaysia who operate in these regions to enjoy services at very low rates since they are treated as customers in any Public bank in the region and can therefore do transactions from its branches in the region with ease. Its network has helped its clients reduce the costs of transactions and traveling since they must not travel far looking for the nearest Public bank branch to do transactions. (Truss, & Stiles, 1999)
The management of Public bank has ensured that they involve all the workers in decision making so that the workers feel that they are incorporated in all that they do and can own changes made by the management and can therefore help improve the efficiency of the bank and help in managing change in the bank. The management is fully trained to have the desire to ensure that things are done well and have the ability and capacity to meet all the challenges that face them and to also make sure that they constantly improve performance so that they can give better service delivery and bring profits for the bank. (Heskett, 1986)
A threat can be referred to as an environmental development or event which will present problems or challenges likely to hinder the achievement of organizational objectives, for example, competition, high interest rates, government legislations, declining real income among others. Public bank is now facing stiff competition from its main rivals like the Citi bank, thus there has been a drop in the market share thus a reduction of their profits. The competing banks in the region are positioned well and are well established. They have a strong financial base to operate in the business and some of the major competitors like Barclays bank are well established all over the world. They have well trained workers who are highly skilled and qualified. The greatest challenge that the Public bank is facing is that all the competitors have attractive products that entice customers and the bank must be very aggressive to win more customers and retain the ones that they have already. (Michael, 2006)
The marketing strategies of Public bank need to be reviewed in order to cope with the increasing competition. For it to continue succeeding globally the marketing managers have to incorporate recent technological developments like doing business online. The marketing department should be well facilitated to do its work and highly funded to do research to improve its products. They also need to have a network that that collects and utilizes the marketing intelligence so as to be more competitive. (Truss, & Stiles, 1999)
There are times when government regulations may hinder the operation of the bank and this can been seen especially in the regions that the bank has moved and opened new branches. This can also be termed as a threat. Public bank has been facing challenges over the last few years when these countries have passed laws that do not favor the bank but only help their competitor through taxation of firms that are not from this particular region. It therefore affects profits in the long run as the local banks are exempted from heavy taxation e.g. Cambodia
A weakness can be defined as any aspect that hinders the Public bank from attaining its objectives or goals. Usually, it covers the firm’s property, capital, and capability. Latest research indicates that Public bank is faced with few weaknesses which must be addressed so that it does not hinder the banks success being the leading financial institution in the region at large. The bank should review its policies so that they may be the best in the region. Also the human resources, that is, the workers and the management have been performing poorly of late in their respective responsibilities. Marketing managers must be more aggressive as they have been rated to need more energy to cope with the ever increasing competition in the banking industry in Malaysia. Some people and customers questions the banks culture of doing things and its reputation as the customers feel they are being overcharged. (Michael, 2006)
Strategies by the Public Bank’s Board of Directors:
Public bank’s board of directors should define the compcny’s mission statement which will involve clarifying and analyzing this mission statement to meet the present challenges of bank and make it more competitive in the region. This will offer guidelines to management of the bank when considering how business should develop and in what direction, for example how it will increase its current market share to greater levels, how it will be able to compete with other upcoming and competing banks and how it will be able to adapt to the changing state of economy. The strategies adopted by the bank should clearly direct efforts towards accomplishing the organizations basic mission, vision and objectives. As reported earlier that the Public bank’s vision is to become a leading bank in financial and business operations board of directors has to embark on a five year plan that includes the following:
The company needs to improve on in its response to globalization. For instance the Public bank has responded to globalization by opening up some branches around the globe but this have not been enough as it still faces competition from other upcoming banks and micro finances which may be offering cheaper terms to their customers. Public bank should explore more new markets not only in Malaysia and its environs but also around the globe and try to monopolize so that it can enjoy the benefits of monopolization and be the leading bank where it is established in order cope with change and competition in the industry. This bank requires restructuring of the entire bank operating structure such that it is able to withstand the pace of growth in the financial sector. (Heskett, 1986)
Organization structures of Public bank should be clearly outlined such that the employees will know what they are expected from them and what they are supposed to achieve in the course of their duties. This will lead to reduction of conflicts between management and the workers because there will be no vague policies. The Public bank structures should be in such a way that it fits the modern world and should be adaptable by all the employees. Groups’ dynamics should also be encouraged in order to enhance cooperation among the workforce. Workers should be given the freedom to join groups of their choice to avoid conflicts that may arise. (Heskett, 1986)
In order to improve the banks operations the management concerned should always avoid poor managerial leadership through doing away with authoritarian style of leading and instead adopt participative leadership and encourage democracy to prevail in decision making that is, an all inclusive decision making structure. Also motivation of employees should be encouraged and offering of fringe benefits, house, medical, hardship allowances, allowing them to have leaves when they apply and other social services for example swimming pools, televisions sets will make the employees feel respected and recognized in the work place and they will feel as part of the company. (Herzberg, & Snyderman, 1957)
Research also indicates that group decision making need to be emphasized because it yields good returns as compared to that of individual decision making. A good communication channel should be identified by Public bank in order to boost organizational effectiveness. Any barriers to effective communication that may be encountered e.g. selective perception, language barrier among others should be dealt with in order to pave way for efficient passing of messages in the workplace. The company should immediately implement the strategies that will counter competition as a result of globalization from other banks and thus the bank should continue to explore new markets around the globe and maximize their good record and brand name to capture new profitable market (Herzberg, & Snyderman, 1957)
The Public bank through its directors should achieve competitive advantage than its competitors by ensuring that they employ more qualified and skilled workers. This can be achieved by making sure that they their selection and recruitment is channeled through a very rigorous analysis to pick the special capabilities from the workers being employed. They should support it by also encouraging the worker to have self development plan to make them give better performance. The bank should develop a very strong organization learning process to boost the performance of all its workers. They should ensure that the recruitments done also capture the unique capabilities of workers who will add value to the bank.
It is very important for the bank to take the to take the reward system of workers as a very important aspect that leads to increased performance and therefore the bank should ensure that they give financial incentives and also ensure that those that come up with new motivation that drive the bank to more success are highly recognized so that they are encouraged to come up with more innovations to improve the bank and these will make the make have a competitive advantage over its rivals. The bank should ensure that they do not have unnecessary expenditure by ensuring that they review all reward practices that will make the Public bank to have value for its money. A good reward system should be encouraged that will link rewards to quality performance in the Public bank as this will make the bank achieve a competitive advantage through quality provision.
Impact of a good HR
The procedures adopted by the HRM Department of Public Bank has been viewed to be of high standards as it is evident in the procedures of recruitment and selection exercises that has at all times yielded good results in terms of sourcing the right employees. These procedures include recruitment and selection process that ensures sourcing the right people to work in this institution so as to improve the services of the bank and also compete better with the existing competitors in the market. (Herzberg, & Snyderman, 1957)
Public Bank’s HRM approach has always fitted both local and global environments. The local approach that the Bank has taken is mainly recruiting the local people in the area of operation to work in the institution. This has led to attraction of customers and increase in total deposits because the local people will always engage in business transactions that involve their fellow citizens. This has enabled the financial institution to do well in the financial industry and has become competitive in the banking industry and the institution has coped with competition from banks like Barclays and Standard banks. Because of invention of advanced technology the world has increasingly become a village and as a result global business is the modern form of business in this 21st century and Public bank has prepared itself to meet these challenges (Herzberg, & Snyderman, 1957)
The directors of Public bank should formulate policies that ensure that the employee’s performance is monitored. The role of employee performance, monitoring, and evaluation will make the workers work hard so that they are evaluated highly so that they may also be easily promoted. The most important aspect of an organized human resource management practice in the Public bank is employee evaluation. The performance and the success of any bank is determined directly by the performance of the employees. It is possible to monitor the evaluation if the employees of any banking institution use of human resource evaluation systems. These systems should be done continuously with a view to retaining useful employees’ in the Public bank so that the bank will have the best force to compete with the other competitors in the financial institution. (Roberts, 1997)
Sometimes employees feel that the management of their respective organizations uses harsh methods of monitoring and evaluating their performance. For example some workers in the bank might complain that their supervisors are too much on them such that they cannot even get time to have tea break during their working time. The workers of Public bank might see such things to being a cause of conflicts between the employer and employees and that will make the workers not to be motivated to go an extra mile and give the best performance n their work place.
The directors of Public bank should use and encourage motivational practices through the Human Resource Department and empower it to manage and balance power between the employer and employee. To be able to be successful as a bank and succeed in the competitive environment in the current global and domestic markets, Public bank should highly motivate and remunerate their workers well so that they can register more growth as a bank (Roberts, 1997)
The Public bank should develop Human resource management policies and strategies that can help the bank perform better as these are fundamental tools for any bank that needs to succeed. The most important asset for any bank is its human resource and therefore all issues affecting the workforce will be affecting the banks performance directly and also its profits. It has been found that issues of planning, recruitment, selection, retention, motivation, evaluation and industrial relations for human resources are of grave concerns and are usually handled through an effective human resource management practices. (Reed, 2001)
In various banking institutions, we find that, many employees are neglected and are most often demoralized since they are harassed and do not like their jobs and are never motivated to perform their duties as expected by their employers. Workers will always appreciate the seniors who make them part decision making and involve them in all that they do. Public bank needs to find a way in which its employees get frequent and considerable appreciation. If such conflicts are not avoided then performance will be low and the Public banks profitability will decline over time.
Public bank should avoid unprofessional interpretation of its policies since it is very important that they handle their workers well since they are very delicate if they are not protected well and motivated to work. The managers of Public bank must handle workers in a mutual way and appreciate them in all they do. When workers are recognized in all that they do, it makes them work more hard so that they are seen by the others and used as examples. (Swart, & Purcell, 2003)
The best method Public bank can openly improve its overall output performance in the first place is to employ, select and train the right personnel. The respective managers of Public bank should understand the feature of personnel management in any bank and ensure that they serve their juniors well. Banks are now engaging in what is normally referred to as job-fit practice which has enhanced production efficiency and effectiveness of employees’ responsibilities in the banks. This practice is useful to banks that recruit new workers all the time and do not want to have their employees undergo extensive training but rather conduct their duties right away using their skills gained elsewhere. Another strategy that the Public bank should use to ensure great efficiency is person-organization fit practice. In this case, the bank seeks to recruit and select persons with good morals who are able to meet the banks’ values, culture and structure so as to act as good public relation officers for the bank. Human resource management practices have been utilized to measure the analysis of the task to be done in the bank. These practices will guide the management to select persons with desirable attitudes and characteristics suitable for the job description and make them competitive and the best for the bank (Wood & Payne 1998).
Public bank should always put all its energies and concentrate on what it can do best so that they can use their strengths in business to make more profits and increase its share capital. The internal analysis facilitates the formulation of calculated plan which requires a clear understanding of the internal strengths acquired over time and any weakness that adversely impact on performance of Public bank. Distinctive competencies are things that give a firm an advantage over similar banks in the region. It does not matter how attractive an opportunity may be in the banking business but must have the competencies to capitalize on it. An opportunity without the competence to capture it is not really an opportunity to the banking business. (Welch, 1991)
Banking institutions are facing very stiff challenges from international players who have better facilities that make them more competitive than their competitors. Banking has now become a global tool that helps in the facilitating businesses to give their best by ensuring that they are served well regardless of their area of operation. Since businesses have now become global, the banks should also move with speed and acquire better banking facilities that will help them serve their customers from all over the world.
Malaysia as country has made reasonable strides to be economic giants in the future since all its industries are having the best management strategies that help them compete well in the market. Banking institutions have attracted a lot of players since it is seen as profit making and with opportunities for growth due to industrialization and globalization. There is constant need to improve facilities so as to be compliant with the changing technology that is being embraced in the whole world. (Truss, & Stiles, 1999)
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