Serandib Bank

CONTENT Page 1. intromission. 1 2. stopping point positr Summary. 2 3. Problem Statement. .3 4. Alternatives. 5 5. Conclusion 8 6. Implementations.. 9 Introduction This is the fourth assignment which I am furtherance as a case chew over for module 4 interrogative sentence of Professional Qualification in Human Resource Management seventy-fifth Batch at the Institute of Personal Management Sri Lanka (IPM).The case is approximately the SerendiB Bank which was playing a achieverful monopoly game in the Bankers national where only devil other local depository fiscal institutions were held out-of-pocket to the Government regulations towards the capital punishment of impertinent desires in the country. The SerendiB Bank was leading the country with a provide of 9,800 at the branches operating in each leading town island wide. actu wholey recently on its 50th anniversary, a new chief decision maker takeicer, Mrs. Maya Perera was appointed on her post who was just return ed back to the country after(prenominal)wards serving 20 years at both contradictory Banks as a Top Executive.With the arrival of new chief operating officer, many sr. executives of the hope were distressed with her new advancement which is emphasized on pursuits. Cooperate imagery and strategies/ melodic phra run acrosss objectives for next phoebe bird years Creating node friendly process Introduction of latest technology Motivating internal provide through impertinent motivation Promoting team rick and achieving goals through team dynamics. The brink was delighting its success for next two years till the time of arriving two foreign cashboxs and with that, suddenly it faced a narrow drop in all aspects.The bank alienated its clients by 50% and the employee turnover was 22%. lastly the bank has close down its 22 branches and divest it two overseas operations. Executive Summary SerendibB Bank was practicing the seniority paperd promotions, non-financial riposte s for individual efforts and in like manner mental faculty enjoyed the traditional banking activities. yet, new CEO emphasized the impotency of induction of latest technology while motivating the provide through inessential motivation and promoting team work and achieving goals through team dynamism.Also, CEO valued to encourage hatful much towards the m nonpargoniltary honors and as a resultant role perpl pass offy introduced nearly a dozen of group inducings whilst statutory knuckle underments were nonrecreational in double over and above the legalized criteria. Although Bank achieved a high growth rate in financial terms during the setoff two years tenure of new CEO, many senior executives were extremely unhappy with the CEOs new approach. With launching of two new foreign banks, many senior module members left from the SerendibB and joined with this new banks for die prospects and relieve with the newly introduce takings schemes.Within first six months, Sere ndibB lost over 50% of customer base and in like manner drop in revenue. Further, SerendibB had to close down 22 branches and divested two overseas operations. This case study demonstrates the employee reward musical arrangements nominate help organizations to achieve their goals. However, Employers must first account each objective devolvely before developing real(a) and intangible asset reward strategys. Important goals such(prenominal)(prenominal) as employee retention and argument satisfaction, creation presentation improvement and employee motivation brush off be achieved by identifying the desired resolution of employee reward syllabuss. . Problem Statement 1. The newly introduced reward forethought system does not fit to the leasements of the employees in the organization. The effectiveness of reward package is impact by internal and external factors and it is grand for employers to continually monitor, evaluate and lay their rewards and benefits packag es to ensure that they continue to meet employees motifs. Changes in the competitive landscape, in the economy, in employee necessitate and in demographics notify all impact how effectively be packages meet employee needs.Ongoing assessment of both internal drivers and external environmental impacts fecal subject help ensure that companies reward packages serve to drive retention in a positive stylus. But, New CEO of SerendibB Has change overd the subsisting reward management system without doing a proper study. Therefore, change of animate reward management system is not suitable to entire organization and its requirement. 2. The newly introduced compensate Management system does not seduce the proper balance in the midst of the Financial and Non Financial Rewards, individual and group rewards.Financial rewards and group bonuss ar wiz way rail linees can institute their appreciation to employees for hard work and dedication, however this should be just one piece of the compensation system. Non-financial rewards and individual incentives can carry just as much weight by empowering employees, as well as giving them a sense of accomplishment and of belonging. CEO of this bank always promoted the monetary rewards and the team work concept among staff. Therefore, reward system should be balanced among financial and non-financial rewards as well as the Individual and the group incentives. . The Reward Management System is not conformable and sustainability. Employee reward systems can help employers achieve their organizational goals. However, employers must first identify each objective clearly before developing tangible and intangible reward systems. New CEO had interpreted a decision to pay in double the EPF,ETF and gratuity over and above the legalized criteria. But he hasnt checked whether the organization can afford such a huge expensein the future. At the same time legal consultants also advised the top management not to grant excessive financial rewards.Therefore, such a reward managements system doesnt stir a sustainability, consistency and credibility 4. The Reward Management System does not provide the purpose. Employers must offer employee rewards that the companys employees find meaningful. Well-managed employee reward management system have tangible affirmative effects on the employers bottom border results such as Attraction, retention, motivation, engagement, return on investment. Throughout the case it doesnt demonstrate the key values of reward management system.Further, Majority of the staff of the SerendibB bank left and joined with new foreign bank due to frustration. In that case SerendibB was failed to full fill the basic requirement of the reward management system. 5. The Reward Management System does not cater the requirements of the brisk staffWithinfirst six months of opening the competitor banks, SerendiB lost over 50% of customer base and had to face huge drop in revenue. Also, many of the senior staff members joined the new foreign banks. By that moment, top management of the SerendibB bank well knew the reason behind.But, nobody take steps to change or enhance the existing rewarding system so that beat fit for the existing employees and retain them with the SerendibB bank. Alternatives 1. SerendibBBank should come up with incentive plans as follows for their employees in order to reward staffs who contri howevere the most to the favorableness goals of the bank. This allows employees to pull back the rewards to their business acquisition activities and helps to promote a sense of self-achievement and teamwork. a) Bank need to identify those products and services that it wants to concentrate upon based on product demand, determine and risk analysis.For example, when a bank trys that too much of its assets are cogitate to the condominium market, a shift toward other income producing real estate is made. at one time the current year product and profitability goa ls are established, the various departments of the bank are informed of the products that the bank is going to pursue. b) It is recommended consult with staff and mint union and gets their ideas of a new incentive system. Also, management can fill brief be to get the ideas of staff. Provide clear choices in survey in order to get clear answers.Ask questions like Would you prefer a cash reward or a personalized plaque for beingness employee of the month? Employee surveys should also list a variety of monetary and non-monetary awards and drive employees to list their preferences. c) A bank profitability system takes each product that the bank offers and classifies it according to the responsible department and customer account. The various customer accounts are assigned to specific employee who manage the account and maturation the business volume of the bank with the customer. The employees also acquire new customer accounts that give back profit.Therefore, a proper profitabi lity system must be surefooted of tracking the progress of existing and new customer accounts by employee in order to reward the efforts of the employee through the incentive program of the bank d) once the various income-producing goals are established for the bank, the acquisition incentive program is communicated to the departments involved. For example, if incentive payments are being offered for acquiring new real estate business loans, the program details what the employee needs to do in order to assoil an incentive payment.The typical program involves the payment of an upfront fee to the employee of two percentage for the original acquisition of new business and a five percent payment after the first year of operation from the ongoing business of the customer. This type of program tends to bring the operation of the bank unneurotic e) The continual monitoring of the profit and loss goals of the bank according to customer and assigned employee must be transparent and avai lable to the relevant employee, as well as to the department supervisor. This allows for total finish and monetary remuneration.It also shows where adjustments need to be made due to problematic relationships. Furthermore, it provides the historical base for progress and motivation. f) Measure employee satisfaction of new or ameliorate incentive plan by obtaining ideas of employees or implementing a survey and review exit interview information. In addition, analyze turnover rates before and after implementing the employee incentive program to measure the effectiveness of the new or alter rewards system. 2. Monetary incentives encourage employee compliance, rather than encouraging risk-taking, since most monetary rewards discover only employee performance.Employees may be motivated to perform in genuine ways to achieve monetary rewards, rather than doing something because it is the right thing to do. This expression can disrupt or end good working relationships among associates , since they have become competitors rather than co-workers, which ultimately disrupts the overall work environment. Non-monetary incentives have been use to reward employees for their good work by providing opportunities for training, flexible work schedules, improved work environments and sabbaticals.Therefore it is essential to take a good balance in the midst of non-monetary and monetary incentives as well as the group and individual incentives. Because it results in a more satisfying program to address the diverse interests and needs of employees. 3. With the lost of customer base, SerendibB bank is in a terrible finance situation. Bank is still paying the statutory payments in double to existing employees due to wrong decision taken by its CEO. Therefore, it is necessary to at one time stop such extra payment (EPF,ETF Gratuity)done by the bank to its employees and on behalf of employees. . SerendibB Bank need effective reward systems in order to allure employees to the bank notice their existing employees and maintain a satisfied workforce. The basal employee reward is usually pay. But, SerendibB has to offer a total reward system that includes good pay and other non-monetary incentives. Designing a total reward system is essential task to be done by the bank to overcome the current problem it has faced. Therefore, bank can implement following to attract external hatful. a) Develop a competitive pay strategy.Benchmark (two foreign banks) the market pay scale for each compensated position in the organization. Once pay scales are determined, Deputy CEO can decide which positions should be paid at, below or above the average pay rate. Critical positions in the organization are frequently paid at higher rates to keep valuable employees and avoid wasting resources on employee searches. b) Establish work-life rewards. These rewards include paid or unpaid sick time, paid lunch and break times, childcare assistance, variable work schedules and other bene fits that dont ordinarily include pay, but are seen as valuable by employees.Organizations that are in a position that precludes paying traditional benefits can sometimes keep employees by offering these types of rewards c) Develop meaningful employee recognition programs. umpteen employees respond to dewy-eyed recognition for a job well done. This can be as easy and spontaneous as a simple thank you or more organized as a periodic or quarterly recognition lunch or dinner. Its important that people who are recognized are authentically outstanding workers. Depending on the profitability of the organization employees be recognized with anything from cash to event tickets to a certificate. ) start up a career development program. Many employees will stay at organizations that offer fewer benefits if they can see that there is possible job advancement available in the future. Offering management training programs that truly given employee a leg up on future career advancement can be viewed as a valuable reward. This can be a very low-cost reward system that keeps employees for the long-term. Its important to only offer training to employees who truly deserve it. 5. At this essential time, it is important to retain existing employees.Therefore it is requires to offer them a short tem rewards such as meal allowances, bonuses, transport allowances, health and life insurance, and annual vacation in order to keep employees. Conclusion Most people work mainly or even exclusively for the money they earn. No employee refuses more money, whether it is a one-time reward or a permanent pay increase, but employee rewards need not always be monetary. Raises and bonuses are among the most warm workplace rewards. The importance of rewards in the workplace extends beyond providing increased pay.Therefore, it is important to starta proper reward system in the bank with the aim of get below results to the SerendibB bank and overcomeexisting problems which bank is experienc ed now. cater Retention Staff turnover is expensive. It costs a company from 120 to 200 percent of an employees annual salary to replace him when he leaves. New hires frequently require considerable time to reach peak performance. Staffs who feel that the bank recognizes their efforts are less likely to seek jobs elsewhere than those who feel that they are taken for granted. Maintaining MoraleAt this moment staffs of SerendibBsuffer from low morale. This is e pickyly due to unhappy with CEOs new approach towards the reward system. Providing rewards can boost morale and need not be much costly. Enhancing Performance Rewarding employees often improves performance on the job. Nonmonetary rewards often produce surprisingly sustained increases in staff productivity. Raises and bonuses also increase staff productivity. Carrot Versus Stick Motivation Bank staff is consisted with better employees. Taking a stick approach to bank discipline is often counterproductive in motivating staff.P unishments, in the form of negative public recognition, can quickly disintegrate into a finger-pointing exercise among employees zealous to keep the spotlight away from themselves. Therefore, it is very vital to have a effective rewarding system in SerendibB bank to speed up the recruitment process and as well as to retain the existing staff . Implementation Implementing an employee reward program is a great way to push workers to excel. Not only does a program generate results for the people who win awards, but it also tends to increase productivity and drive staff to give their most to the SerendibB Bank.Therefore, it is recommended to consider the below given areas when implementing and employee reward program to the SerendibB Bank. Director HR should take an initiative to implement a reward policy for the Bank so that it would be clear to the bank staff. Also, bank need to initiate a grievance handling system, so that staff can come up with any problem they have and come out f or a solution. If such is available staff might wait and see whether they can have solution before they go for drastic actions such as leaving form the bankCreate two lists of goals, one for the bank and one for the staff. Be clear on what the staff are expected to do within the program and what bank want to achieve by creating it. increase customers, improving staff morale or rewarding hard staff are all acceptable goals, as long as bankis clear on them. Decide on the type of prize that will be awarded. Prizes can be symbolic (an actual certificate or medal) or they can be material and focus on money rewards, special items or long-term rewards, such as more time off or a raise. Announce the timing of the reward system.It doesnt really matter bank plan on handing out awards on a monthly or quarterly basis, but it has to plan in advance. Management of SerendibBlet the staff know what to expect and when. Once announce the program, HR department of the bank can do updates throughout th e month or quarter to show where the process is going and how everybody involved is doing. Designate a leader to keep track of the system. This could be a manager, a staff who is not participate in the program. Create a schedule or a follow-up system so bank staff can track themselves and make the process easier for the leader..