As determined by Harter et al (2002), “employee satisfaction and
engagement are related to meaningful business outcomes at a magnitude that is
important to many organizations”. This would be the same for banking
institution as well, banks which make employee engagement a priority will enjoy
competitive advantage over other financial institutions (Seitz 2019). Thus, it
can be said that there is an inevitable connection between employee engagement
and organizational performance which paves the way for the organizations to
explore the possible ways to achieve employee engagement.
This study consists of the factors which were considered to be the key in achieving employee engagement by many literates and emphasizing to what extent a several leading private banks in Sri Lanka taken the mentioned factors into consideration when developing their employee engagement strategies.
1. Training and Development
Training can be defined as the organized way in which organizations provide development and enhance quality of new and existing employees. As per Khawaja & Nadeem (2013), training is viewed as a systematic approach of learning and development that improve individual, group and organization. Training has been invaluable in increasing productivity of organizations. Hence, it can be said that training not only improve employees’ productivity but, also organizations’ productivity.
On the other hand, development refers to activities leading to the acquisition of new knowledge or skills for purposes of growing. Organizations need to provide employees with development programs in order to enhance their capabilities.
All
in all, training and development can be considered as one of the most pervasive
methods to enhance the productivity of individuals and communicating
organizational goals to personnel (Ekaterini & Vasilios, 2009).
As per Phillips’s (1996) summary of the American Society for Training and Development’s return on investment for training case studies, in a variety of industries notes that the returns on investment on training and development ranged from 150% to 2000% which further highlights the importance of training and development to the organization at large. Thus, it is imperative that organizations should invest in employees training and development activities to improve employee engagement.
Table 1.0: Analysis on the Methodologies Adopted by Four Leading Private Sri Lankan Banks to Drive Employee Engagement.
|
Bank |
Influencing Factor/
Training & Development |
|
Commercial
Bank |
|
|
Hatton
National Bank
|
|
|
National
Development Bank |
|
|
Sampath
Bank |
|
2. Remuneration and Benefits
One of the important factors affecting the level of engagement is remuneration. As per Stachowska (2016), remuneration should basically include the following,
- Fixed remuneration.
- Changing elements
of remuneration linked to performance - such as bonus and
commission.
- Components of
financial participation - shares
and stock options, participation in profit division, savings plans.
- Benefits - health insurance, medical care, pension schemes,
additional paid leave.
- Perquisites - subsidized meals, mobile phones.
- Other additional benefits such as corporate loans at concessionary rates, travel allowances.
Remunerations should not be only limited to material incentives, that is in addition the above mentioned components it should include intangible components as well such as flexible working hours to facilitate work life balance.
The
following evident how rewards affect employee engagement:
- ‘Fair
pay’ was a key element influencing employee commitment in the Canadian
government service‐performance chain (Heintzman and Marson 2005).
- Connecting
pay to performance has the greatest effect on discretionary effort compared
with a range of other factors (Corporate Leadership Council 2004).
- WorldatWork’s research indicated that performance related pay has a particularly strong impact on the engagement of an organization’s top performers (2004).
In simple terms, a comprehensive remuneration model builds employee engagement, assures satisfaction and creates the opportunities for the development possibilities and career while maintaining a balance between work and other obligations (work-life balance), on the other hand – it leads to the development and success of the company and multiplies its effects (World Scientific News 2016).
Table 2.0: Analysis on the Methodologies Adopted by Four Leading Private Sri Lankan Banks to Drive Employee Engagement.
|
Bank |
Influencing Factor/
Remuneration & Benefits |
|
Commercial Bank |
|
|
Hatton
National Bank |
|
|
National
Development Bank |
|
|
Sampath Bank |
|
References
Commercial Bank Annual Report 2019 (Online) Available from: https://www.combank.lk/newweb/images/pdffiles/2020/Commercial_Bank_Annual-Report_2019-CSE-Version.pdf (Accessed on 4th November 2020).
Corporate
Leadership Council, 2004. Employee Engagement Framework and Survey: Corporate
Leadership Council research.
Ekaterini G.,
Constantinos V., 2009. “A model
for evaluating the
effectiveness of middle
managers‟ training courses: evidence
from a major
banking organization in
Greece”. International Journal of
Training and Development, pp. 221-245.
Harter,
J.K., Schmidt, F.L., & Keyes, C.L., 2002. Well-Being in the Workplace and
its Relationship to Business Outcomes: A Review of the Gallup Studies.
Heintzman, R., &
Marson, B., 2005. People, service and trust: Is there a public sector service
value chain? International Review of Administrative Sciences, 71(4), 549–575.
HNB Annual Report 2019 (Online)
Available from:
https://www.hnb.net/images/annual_reports/2019/integrated-report-2019.pdf
(Accessed on 4th November 2020)
Khawaja &
Nadeem, 2013. “Training
and Development Program and its Benefits to Employee and Organization: A Conceptual
Study”, European Journal of Business and Management.
NDB Annual Report 2019
(Online) Available from:
https://www.ndbbank.com/cms/media/2612/AnnualReportFinal-449aa5e6b379a0e547ebde1f9443f1cc9a7aeb82.pdf (Accessed on 4th November 2020)
Phillips,
J. J., 1996. ROI: The search for best practices. Training & Development,
50(2), pp. 42-47.
Sampath Bank Annual
Report 2019 (Online) Available from:
https://www.sampath.lk/images/annual_reports/ar2019.pdf (Accessed on 4th November 2020)
Seitz,
A., 2019. Employee Engagement: Tangible Benefits and Best Practices from Banks
Who Are Doing It Best. (Online) Available
from:
https://www.wisbank.com/articles/2019/07/employee-engagement-tangible-benefits-and-best-practices-from-banks-who-are-doing-it-best/
(Accessed on 5th November 2020).
Stachowska,
S., 2016. The role of remuneration in building employee engagement.
World
at Work, 2004. ‘Paying for Performance 2003‐04.’ Survey of World at Work
members by World at Work and Hewitt Associates.
It is recommended to foster a culture of learning and development that extends development opportunities from instructor led sessions to mentoring, coaching, job transfers, self-learning on the job, e-learning and innovation which can simultaneously challenge, support and enable employees to harness their potential for own career progression. Which means a shift in the mind set of employees from managers being responsible for their career progression to defining own career progression through self-learning. Though creativity and courage may be required to engage and motivate employees emotionally to operate at their limits, this bold step can help employees develop their learning agility and proactively create the solutions needed for the future H5:Team work and collaboration encourages more learning, old ideas are challenged, and increases momentum of change and achievement, while focused on a common goal which gives employees new learning, job satisfaction, and a second family feel. Therefore has a significant influence on employee engagement and thus, increased business productivity and growth. Accepted which can result in positive and significant impact on employee engagement(Mansoor and Hassan(2016).
ReplyDeleteYes Janaka, the independent variables to measure employee engagement include communication, team work and collaboration, job role, Company management and learning and development, which have a positive and significant effect on employee engagement. In today’s business environment, Learning & Development (L&D) is a key strategy to enhance work force capabilities, skills and competencies in order to maintain a sustainable, successful organization. Learning & development increases employee confidence, morale, efficiency builds capability to take additional responsibility boosting career progression resulting financial gain ( Mansoor & Hassan , 2016).
DeleteAccording to Armstrong (2014) Engagement can be regarded as having three overlapping components motivation and commitment and organizational citizenship behaviour.
ReplyDeleteAdding to your comment Ranga, employee motivation is directly linked with business profits makes it all the more important to keep employees encouraged and in high spirits. Human capital is the most valuable asset of any organization. Today’s organization also faces a big challenge of retention as well as attraction of new talent in the organization, and motivational strategies could be one important contributors to organizational success in long-term ( Varma , 2017).
DeleteIt has been long thought that learning new things and competency development opportunities raises the morale and satisfaction of the employees but it is also realized that the significant effect on the motivation and job satisfaction is created by goal achievement (Lather and Jain, 2005).Also the managers and the supervisors support towards encouraging employee participation, mutual commitment, and understanding of the diversity issues play a significant role in motivating and enabling performance(Snyder et al, 2004).
DeleteEmployee remuneration is an important attribute of work engagement as it motivates employees to increase their work performance (Anitha,2014). The level of remuneration must be appraising acceptable if high levels of engagement are to be expected. Anitha (2014), state that fair pay influences the engagement and performance of middle and lower managerial employees in small-scale organizations. In a cross-cultural analysis, fair pay was amongst the most important tools of employee engagement (Sanchez and McCauley, 2006).
ReplyDeleteHi Chamila , San et al. (2012) showed that to enhance organization reputation and also to boost the
Deleterecruitment possibility where more manpower will make a stronger team within organization
through rewards that lead both financial and non-financial performance of the employees in the
company. Effective reward strategies not only fulfilling the employee’s basic requirement but also
increase their engagement in the organization that is a growing signal for the organization.
Many have attempted in recognizing the factors leading to employee engagement and developed models to draw implications for managers to determine the drivers that will boost employee engagement levels (Kompaso and Sridevi, 2010). Job challenge, rewards and recognition, variety, autonomy, feedback, and developmental opportunities are some major drivers (Crawford, et al., (2013). Engagement does links substantially to leadership and once the ideal is applied, the results touch the skies. Correct leadership matters a lot since the trust factor increases engagement. Cognitive trust between team members and between team leader is a major player in enhancing performance and commitment (Chou, H et al. 2013).
ReplyDeleteYes Asitha , rewards can have a great impact on engaging employees within the organization. It is observed that engaging employees within organization is a very complex process but management must take time to fully develop it. Reward systems should be aligned with the company’s goals and objectives, employee development, company’s strategies and team performance. In order to create a competitive edge organization should maintain the reward system within the organization so that employees work hard and efficiently perform in their work. In the company these programs usually train and inspire associates to become more productive, efficient and respected individuals ( Benazir & Iqbal, 2015).
DeleteEmployee engagement is fully influenced by leadership, workplace culture, company
Deletereputation and reward practices. Engaged workers work very hard and loyal to their organization.
Thus, to raise the values and principles of engagement, HR must design programs and practices for
the employees in whom they connect in their work and feel committed to their organization and its
goals and objectives. So the employees perform well in the organization (Benazir & Iqbal, 2015).