Nepal Bank Limited (We Started Banking in Nepal…Still we are Leading Way) is the first commercial bank of Nepal established on November 15, 1937 (Kartik 30, 1994). This marked the beginning of an era of formal banking in Nepal. From the very conception and its creation, NBL was a joint venture between the government and the private sector. The bank has a corporate vision of being “Pioneer Bank with complete banking solution”.
The objectives of the bank are mainly to focus on building the positive net worth and meeting minimum capital requirement over the coming five years, focus on increasing the customer base and market share, maximize the potential/efficiency of bank’s staff and focus on minimizing the risk associated with the business.
NBL has a total of 114 branches and 2815 employees as of Nov 2011. Among the total number of employees, the number of Permanent Staff is 2378 (% of Female: 23%, Male: 77%) and the total number of Contract-based Staff is 437 (% of Female: 9. 0%, Male: 90. 10%). The bank is under the control of Central Bank of Nepal, Nepal Rastra Bank (NRB).
NRB has appointed a five members management committee. This management committee performs as the Board of Director of the bank. Mr. Raju Nath Khanal is the Chief Manager of Human Resource Management Department (HRMD). The Deputy General Manager is Mr. Ram Bihari Shah, HRMD, Legal Department & Training Center and the Acting General Managers and Members of Management Team is Mr.
Kiran Kumar Shrestha (HR, Legal, Training Center, Accounts, Corporate Planning, RMD & BMD) It is definitely a challenge for Nepal Bank Limited to manage the human resource at such a large number. An interaction with some human resource personnel at the head office of the bank located at New Road has helped to develop an outline about the performance management at NBL. The responsibility for the review of performance system in the organization is vested on the executives of various departments. As per Arjun Pudasaini, Human Resource Personnel at the head office, every department in every ranch is a crucial reviewer of the employee performance. The executives of each department acting as the line managers are responsible for the review of the performance of the employees. The review is sent from the different branches to the head office. The organization carries out the performance evaluation of the employees in annual basis. However, NBL does not have written performance goals or plans, but it adheres to the entire organizational vision, mission and goals for effectiveness. A performance management system is maintained in an integrated form of manual and computerized system.
The evaluation criteria for the performance of the employees are basically: regularity (less absenteeism), work accuracy, punctuality, behavior, goal achievement, discipline. In addition to this, the interpersonal relationship of an employee with other employees in the bank is also considered to be very crucial. For the purpose of employee performance management, the bank has an in-house training section that provides training and coaching programs in need. Thus, the training conducted has a pivotal role to play in increasing the productivity of the employees who are interested.
The need for training is basically identified when there are high errors, less accuracy and high time taken to perform the activities assigned to the employees. In addition to the training program, the bank also focuses on, on the job trainings and outsourcing of instructors. NBL provides the supervisor of the respective departments with the individual files called “Karmachari Niyamawali” which is used by the supervisor to keep the track of the performance and achievements on a regular basis.
Here, s/he is entitled to give grades to the employees as per their level and the criterion determined and on the basis of grades assigned, employees are nominated for training programs. The motivational techniques applied in the organization are basically praise and appreciations, monetary rewards like bonuses and provision of provident fund is available, along with this, other recreational events are organized for marking the profit achievements during different quarters, picnics etc. Likewise, promotions are basically granted on the basis of experience, interpersonal abilities and job accuracy and effectiveness.
Along with this, encouragement and supervision by the head of the department is also appreciated by the employees. There are certain external factors too, that affect the performance of the employees. With the increase in competition from different private banks, the employees do need to take care of strategies to be efficient and to stand out amongst competition. As NBL has a huge loyal customer base, the customer feedback and better customer services are very important. Likewise, the market of banking services and political factors are reported as essential factors that affect the performance of the employees.
One of the crucial information that has been derived from NBL is that it does not provide feedback to employees about their performance. The grades are assigned to the employees from the executives and supervisors from the respective branches and these grades are further sent to the head office. The Chief of Human Resource Manager scrutinizes that marking and again some marks are assigned from the two higher level of management comprising the deputy managers and acting general managers of Human Resource department. To ensure that biasness and personal prejudices do not affect the grading, reviews are also conducted.
Reviewer is supposed to check whether the judgment done is fair or not and in case of any grievances, they have authority to correct the mistakes. The bank, however, does not follow an open system of evaluation where the evaluation or rating is formally discussed with the employees. Therefore, the curtain of confidentiality exists in the evaluation system and the reasons behind this are particularly the Nepalese system and culture in which they raise voices against management and exhibit their dissatisfaction through comparison of their performance with others.
For employee’s performance management, NBL has ranked training and development as the most prioritized tool. The least preferred tool is supervisor’s efficiency and feedback. The job rotation, rewards, development planning and mentoring are ranked simultaneously after training and development. However, the supervisor undertakes the process of job rotation only when they derive the consent of the employees after making sure the positions are vacuum and need attention. This is done after measuring the employees’ abilities in the respective fields. So, job rotations are not much in use in the bank.
The perception of the Human Resource Department is that employees do not possess any individual goal plans. In addition, it has not been able to indulge its employees in the process of goal setting because of which they are still unable to identify, measure, and develop the performance of the employees in order to align with the organizational goal. The bank supports the view that work of the employees is reliable and absenteeism has never been a problem. But there is an unsatisfactory response from the bank that employees sometimes hesitate to obey the bank’s instructions and orders.
The organization strongly believes that its employees possess adequate knowledge about their job and at present, the organization is running smoothly. Likewise, the bank strongly agrees that the assigned tasks are usually completed on time. For performance management, the bank agrees that monetary rewards are better than non-monetary reward. Finally, it appears that in the view of NBL, the greatest challenge for improving the organizational performance management system is to maintain coordination in performance of huge number of employees in various branches and departments.
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