HRM
HRM
HRM
Introduction
In addition, a clear and well-defined statement of the problem is considered as the foundation for
development of the research proposal. It enables the researcher to systematically point out why
the proposed research on the problem should be undertaken and what he hopes to achieve with
the findings of the study.
Broad Objectives:
To examine the human resource management practice in Bangladesh Development Bank
Limited.
Specific Objectives:
The present study has been conducted with a view to achieving specific objectives :
Source of Data
Primary Sources
Secondary Sources
respondents of HR department
Communication
with
Website
of
the
Bangladesh
of Bangladesh
Several
books
and
periodicals
other
Three (03) months internship isnt sufficient to know about a research problem.
Management does not want to disclose internal information because may charge the bank.
All the employees are not equally interested to share their opinions because they as govt.
officials were in panic to expose all the information.
Confidentially is the main problem, as a result some confidential facts are not sufficiently
disclosed by the respective personnel.
Time is limited that would mostly with stands a compressive study on the topic.
Sufficient records, publications, facts and figures are not available; these constraints
narrowed the scope of the real analysis.
Finally this is my first job experience. So lack of previous practical knowledge in such a
research study is limited.
Chapter : 2
Importance of HRM
Enhancing Efficiency
Creation of Discipline
Providing Motivation
Reducing Discremination
Staffing :
Maintenance Functions :
Job Analysis
Recruitment
Selection
Relationship
Functions of Human
Resource Management
Socialization
Job Designing
Training
Job Evaluation
Management Development
Performance Appraisal
Carrier Development
10
11
Working Environment
Motivational Factors
Technological Limitations
Legal Environment
Corruption
Nepotism
Lack of Communication
Job Rotation
Job Security
12
In a developing country, human resource is most effective for the development of the
organizations. If organizations provide better working environment & better job security then
employees become resource & they have take participation in development of the countries.
Motivation is the act of stimulating some one or oneself to take a desired course of action.
Different organizations take different way to motivate the employees. The incentives of
motivation can be financial or non-financial. Both types of incentives are given below as chart :
Incentives of Motivation
Financial Incentive
Non-financial Incentive
Remuneration
Job Security
Bonus
Recognition
Participation in Management
Fringe Benefits
Career Development
Minimum Supervision
Training Facilities
13
Chapter : 3
14
3.1 Background
With the decision of the Government, Bangladesh Development Bank Ltd. (BDBL) was
incorporated on 16 November, 2009 as a Limited Company under the Companies Act, 1994 by
merger of former Bangladesh Shilpa Bank (BSB) and Bangladesh Shilpa Rin Sangstha (BSRS),
two Development Financial Institutions (DFIs) in the public sector.
Bangladesh Shilpa Bank (BSB) was established in October 31, 1972 for accelerating the
industrial pace of the country through providing loans and equity to the industrial projects as per
Bangladesh Shilpa Bank Order, 1972 (Presidents Order No. 129 of 1972).
With the same objective, Bangladesh Shilpa Rin Sangstha (BSRS) was also established in
October 31, 1972 as per Bangladesh Shilpa Rin Sangstha Order, 1972 (Presidents Order No. 128
of 1972).
In order to carry on business activities of BDBL, Bangladesh Bank issued banking licence on 1911-2009.
Two Vendor Agreements were signed between the Government of the Peoples Republic of
Bangladesh and the BDBL on 31 December, 2009 to acquire/and take-over all of their (BSB &
BSRS) assets, benefits, rights, powers, authorities, priv/{leges, liabilities, borrowings and
obligations and to carry on with the same business.
As a public limited company, BDBL formally embarked its journey on January 03, 2010. It
extends financial assistance for setting up industries and provides all kinds of commercial
banking services to its customers through its branch network in Bangladesh.
The BDBL also inherited membership of Dhaka Stock Exchange Limited (DSE) and Chittagong
Stock Exchange Limited (CSE). In order to contribute to the capital market, it acts as stock
dealer and operates two brokerage houses, one at Motijheel and the other at Karwan Bazar which
are providing services to investors - small and medium. The BDBL is also managing a close-end
Mutual Fund with paid up capital of Tk. 5.00 crore.
15
Legal Status
Date of incorporation
Formal Inauguration
Registered Office
Authorized Capital
Paid Up Capital
757
04
21
42.5%
Membership
Web Site
www.bdbl.com.bd
Description
BDBLS
Increase /
16
No.
BSRS Position
As on
December, 2009
Position As
on
December,
2010
Decrease
(%)
01
Deposit
143.00
325.40
127
02
1027.00
990.60
(4)
03
DSL Paid
58.28
57.77
(0.87)
04
DSL Outstanding
316.22
261.06
(17)
05
Income
121.00
183.77
52
06
Expenditure
67.00
101.29
51
07
53.55
82.48
54
08
Loan Sanctioned
109.84
77.32
(30)
09
Loan Disbursed
91.21
77.07
(16)
10
Loan Recovered
106.58
170.52
60
11
20.65
24.64
19
12
2437.96
2387.23
(2)
13
293.20
310.17
14
38.50%
15
Shareholders Equity
*1563.72
142.87
643.86
Year
Capital
Maintained
Excess Capital
400.00
650.19
250.19
400.00
1063.25
663.25
Board of Directors :
The Board of Director consists ofChairman
Managing Director &
Nine Directors
18
Human resources Department (HRD) manages centrally the manpower of the Bank at work
places through researching, placement, training, performance, discipline etc. it emphasizes on
strategic and value added Human Resources (HR) activities involving the designing, updating
and amending HR policies and procedures for continuous improvement. Besides these, this
department accomplishes the sanctions of loan to the employees, doing welfare activities,
providing gratuity among its employees and employer. To execute the above mentioned issue
HRDs function are accomplished under the following divisions:
1. Staffing division (Recruitment and Outsourcing Wing)
2. Office division (Development and Benefit Wing)
3. Disciplinary division (Performance, reward, punishment)
4. Welfare department (Gratuity, pension, bonus, allowance)
5. Policy section
Here the structure of Human Resource Department is shown:
Development Officer
Assistant Officer
Assistant Officer
Assistant Officer
(Admin)
(Staffing)
(Training)
Assistant Officer
(Appraisal)
19
Recruitment and selection is one of the major parts of HR operation in any organization. So in
recruitment and selection cycle there need a chain of command meaning that who will report to
whom.
General Manager
On January 3, 2010 the bank started with 17 Branches, 4 zonal offices and 21 departments in
head office. But now at present, 6 new departments have been added management & they open 4
new branches. Two new departments namely Credit Risk Management Department and
International Banking Department have since been added. We plan to open gradually 11 more
branches in different commercially and geographically important places of the country and have
already got permission from the Central Bank for opening four new branches, Narayanganj and
Khatunganj in Chittagong which is under process.
To mobilizes financial resources from within and abroad to contribute to Agricultures, Industry
& Socio-economic development of the country and to pay a catalytic role in the formation of
capital market.
To employ quality human resources and enhance their capability through motivation and
right -type of training at home and abroad;
3.9 Values
Customer focus
22
Select and invest industrial projects where locational advantages like local availability of
raw materials, good infrastructural facilities (road communication, transport facilities,
etc.) and utilities (power, gas, water, etc.) shall be available.
Limit project loan to Tk. 15 crore maximum and Tk.2 crore minimum (for large projects).
Arrange and participate in syndicated loan for projects above Tk. 15 crore.
Identify prospective and potential entrepreneurs and investors / clients and motivate,
guide and help them select profitable industrial venture for investment.
Undertake from time to time SWOT (Strength, Weakness, Opportunity and Threats)
analysis for reviewing banks market position.
on syndicated
private
partnership
(PPP)
project
(Port
development,
transport
&
Current Deposit
23
Savings Deposit
Fixed Deposit
Retail Banking :
(i) Consumers Credit
(ii) Personal Loan
24
3. Foreign Exchange :
Local L/C
Import L/C
Export L/C
Foreign Remittance
country. It gave emphasis on providing financial assistance for setting up of viable projects
having comparative opportunities, export prospects, forward and backward linkages and local
technology as well as indigenous raw material based and eco-friendly projects. Commercial
banking and capital market operation were also other area of businesses.
Besides, top priority was given to realization of its loans for augmenting and recycling of the
invest able funds and maintaining satisfactory loan portfolio for increasing profitability. For
regularization of loan accounts of the projects, the Bank undertook some laudable steps towards
replacement/ rescheduling of sick /closed/ stuck-up projects with waiver facilities where deemed
appropriate. Apart from this, initiatives were also taken to bring down the amount of classified
loan during the year. The Bank prepared a manual on Lending Policy and Procedures afresh in
congruence with Credit Risk Management (CRM) manual of Bangladesh Bank and Industrial
Policy, 2011 in order to make the credit management of the Bank more pragmatic and strong.
The activities of Bangladesh Development Bank are given below in figures:
Activities of BDBL
Operational
Others
Advisory services
Deposit mobilization
Training
Computerization
Human news
Board news
Other implementation
Loan portfolio
Loan recovery
Structure
Internal environment
Strengths
Weakness
Elements :
External environment
Opportunities
Elements :
Technical
Capital
Economic
Skill
Legal
Technical knowledge
Political
& technology
Threats
Socio cultural
27
Strengths:
BDBL has provided its banking service with a top leadership and management position.
The board of Directors headed by its managing directors is a skilled person in business
world. The advisor of the bank is a reputed senior chartered accountant having vast
experience in accounts, audit, and finance and banking at home and abroad. Managing
Directors of the bank is the leader of management team. The top management officials
have all worked in reputed banks and their years of banking experience, skill and
expertise will continue to continue towards further expansion of the bank.
BDBL has already achieved a high growth rate. The number of deposit is increasing
rapidly.
BDBL has an interactive corporate culture. The working environment is very friendly,
interactive and informal and there are no hidden barriers or boundaries while
communicate between the superior and the employees. This corporate culture provides as
a great motivation factor among the employees.
BDBL has the reputation of being the provider of good quality services to its potential
customers.
Weakness:
The main important thing is that employees of the BDBL are losing their interest to
perform the tasks attentively because they are too melancholic not to be promoted. The
banks not have any long term strategies of whether it wants to focus on retail banking or
28
become a corporate bank. The path of the future should be determined now with a strong
feasible strategic plan.
The bank failed to provide a strong quality recruitment policy in the lower and some mid
level position. As a result the services of the bank seem to be dues in the present days.
The poor service quality has becomes major problem for the bank. The quality of the
service at BDBL is higher than the Dhaka Bank, Prime Bank, or Dutch-Bangla Bank etc.
however; the bank has to compete with the multinational bank located here.
Some of the job in BDBL has no growth or advancement path. Therefore, lack of
motivation exists in persons filling those positions. This is a weakness of BDBL that it is
having a group of unsatisfied employees.
In terms of promotional sector, BDBL has to more emphasize on that. They have to
follow aggressive marketing campaign.
The loan and advances of the BDBL is reducing during this year because now it focuses
on collecting the existing loan than those of financing the new projects. This effect is
going to be long-lasting.
Poor IT infrastructure.
Opportunity:
In order to reduce the business risk, BDBL has to expand their business portfolio the
management can consider options of starting merchant banking.
BDBL has also a mutual fund that was derived from the Bangladesh Shilpa Bank. The
mutual fund of the BDBL has no future whether it is operated or not.
Opportunity in retail banking lies in the fact that the country has increased population is
gradually learning to adopt consumer finance. The bulk of our population is middle class.
29
Different types of retail lending products have grate appeal to this class. Os a wide
variety of retail lending products has a very large and easily pregnable market.
Competitive environment, BDBL must expand its product line to enhance its sustainable
competitive advantage, in the product line; they cannot introduce the ATM to compete
with the local and the foreign bank. They also cannot introduce credit and debit card
system for their potential customer.
In additional those things, social investment bank can introduce special corporate scheme
for the corporate customer or officer who have an income level higher from the service
holder. At the same time, they can introduce scheme or loan for various service holders
and the scheme should be separate according to the professions, such as engineers,
lawyers, doctors etc.
Threats:
All sustain multinational banks and upcoming foreign, private banks posses enormous
threats to BDBL. If that happens the intensity of competition will rise further and banks
will have to develop strategies to compete against an on slough of foreign the banks.
The default risks of all terms of loan have to be minimizing in order to sustain in the
financial market. Because, default risk leads the organization towards bankrupt BDBL
has to remain vigilant about this problem so that proactive strategies are taken to
minimize this problem it not elimination.
The low compensation package of the employees from mid level to lower level position
threats the employee motivation. As a result, good quality employees leave the
organization and effect the organization as a whole.
Political influence.
30
Reduce the rate of classified loan to 25% through sanctioning of good quality loan
recovering of the said loan.
Provide term and working- capital loan to projects attaching due importance to SME and
environment friendly projects.
Retain Bank-Client relationship and serve them with professional excellence &
innovative ideas
Remodel the retail banking business in line with customers financial needs
31
Enhance professional excellence and skill of the employees through imparting need based
training.
Improve consistently IT backbone of the bank complying with the instructions of the
Central Bank in order to provide customer with technology driven services.
Separate and establish another subsidiary company to perform capital market operation to
focus more in the core banking business.
Manage expenses efficiently in order to reduce the cost- to- income ratio to the average
level.
Engage in CSR activities basing on the Triple Bottom Line Approach: People, P and the
Profit.
Bangladesh Development Bank Limited will be able to attain its goals through well- defined
strategy and targets by a dedicated line of human resources who with a special care, concern and
consciousness.
The service quality of the bank should be developed as like private Bank.
They need to increase their branch network over the whole country.
Basically, they need to follow their main HR principal right person, right place & right
time.
The bank should create long term strategies to motivate employees & provide more
bonus as like private bank.
The bank should emphasis strong quality recruitment policy in the all level.
32
Their interest rate is almost same to private bank. But as a government bank they should
reduce interest rate.
They should given emphasis on foreign exchange to collect foreign remittance quickly
they need to collect swift machine for better foreign exchange documents transactions.
The compensation package of the employees to all level should be increased to attract
quality employees.
The need to provide loan in proper way & reduce loan default.
33
Chapter : 4
Analysis
34
4.1 Analysis
Throughout my internee period I have worked seven department of Bangladesh Development
Bank Limited, the theoretical aspects, that is what should be the procedures and requirements
maintained from first to last, and actual practices as well as the ultimate gain for the company in
conducting financial activities and try to help at my level best to help them in their work.
Basically I know more about Human Resources Management Practices.
Bangladesh Development Bank Limited has a prepared internship program for internees.
Although it is rarely followed, it served as a guide for me. I was rotated across 10 different
departments in the past 3 months.
It was very interesting working at Bangladesh Development Bank Limited. The people there are
really nice and talented. The things that I have noticed and observed are:
Work is never left pending for the next day unless it is absolutely necessary
A good job performance is rarely praised, hence lacking motivation of the employees
The work activities are always set and divided for each of the employees. This is the way
it should be, but when I saw it firsthand it was remarkable. Each and every employee has
a certain set of responsibilities. He/she carries out those responsibilities throughout the
day. It is also easy to assign duties that way. Even though this is the case, I often saw
other staff members helping each other out.
35
The Human Resource Management Department (HRMD) was formed to make skilled manpower
for the organization. This department is usually handle all types of employee, recruitment,
promotion, related policy, welfare of the officers, leave, advantage, reward, treatment, retirement
etc.
The department of Human Resource Management is modernizing the structure of the
administration of the bank and development the skill of the human resource and reducing
operating cost of the organization.
Sections
Activities
General Administration
Management Section
Disciplinary Section
Welfare Section
36
4.1.2 HR Training :
A Training Institute of the Bank is in the offing. However, in 2010, a good number of needbased training programs as indicated below were designed and implemented for the incumbent
employees:
SI.
Subjects
No.
1.
Training Course(s)
120
Commercial Banking
89
Computer Course
40
BIM
20
BIBM
BIBM, BB Training
Basel-II
40
Training programs have also been designed for developing skills and proficiency of the new
recruits as well as of the existing employees.
To assess & collect compatible personnel who will be perfect for the bank.
To prepare & implement policy about human resources & related activities.
37
To make serve rules, correction, expansion, administration rules, sub rules, orders, notice
etc. for controlling staff
To give scholarship to the brilliant student of the university for appointing & finding
skilled officer.
To communicate with trade union scrutinizing their demands, open discuss, developing
the relationship with administration proper implementation of labor law.
To give loan for house building, by cycle, motorcycle & ensure their proper utilization.
To maintain relationship with retired or dead stuffs & their families to know their
conditions.
To control the activities to the staff of the banks & take proper step to implement
computer technology.
Effective Human Resource of an organization depends on the specified rules and policies which
provide a guideline to solve any problem arise in this department. For this reason the policy
should be prepared in such a way so that it can be used for long term as well as flexible for
changing environment. HRD of Bangladesh Development Bank Limited has the written Human
Resource Policies (Bangladesh Development Bank Limited, Service Rules-1991) contained the
followings:
A. Recruitment and Selection
B. Training and Development
C. Performance Appraisal
D. Motivation of Employee
E. Leave & Vacation
F. Discipline
G. Retirement
Work Activities: information is usually collected n the actual work activities performed, such as
cleaning, selling teaching or painting. Such a list may also how, why and when the worker
performs each activity.
Performance Standards: information is also collected regarding standards (in terms of quantity
or speed for each job duty for instance) by which an employee in this job will evaluated.
Job Context: included here is information about such matters as physical working conditions,
work schedule, and the organizational and social context for instance, In terms of the number of
people with whom the employee would normally have to interact. Also included here might be
information regarding incentives for during the job.
Job Analysis
Recruiting and
Job Specific
Selection Decisions
Training Requirements
Job evaluating
Wage and salary
Performance
Appraisal
40
3. Having the applicants fill out application forms and perhaps undergo an initial screening
interview.
4. Utilizing various selection techniques and such as test, background investigations and
physical exams and identify variable job candidates.
5. Sending to the supervisor responsible for the job one or more variable job candidates.
6. Having the candidates go through one or major selection interviews with the supervisors
and other relevant parties for the purpose of finally determining to which candidates and
offer should be made.
Job rotation
Coaching/under approach
Junior board
Action learning
Management game
University-related programs
Role playing
Behavior modeling
Organizational development
41
Survey feedback
Team building
Auditing
Accounting
The training department evaluates the effectiveness of the training program through the
performance in test. The employees sometimes are sent to the outside for training. They are sent
outside for training. The sent to:
BIBM
BMDC
ICMAB
Computer Center
Foreign training:
Scholarships for short-term courses are provided by the following organization.
World Bank
42
Banking Diploma:
BDBL encourage the employees to complete the banking diploma given by the IBB (Institute of
Bankers of Bangladesh). The employees get the following benefits for his achievements of
Banking Diploma.
Remuneration (Cash)
Promotion benefit
Study leave
Increment
C. Performance Appraisal:
Graphic rating scale: a scale that lists a number of traits and a range of performance for
each. The employee ID then rated by identifying the score that best describes his or her
level of performance for each trait.
Alternation ranking method: ranking employees from best to worst on a particular trait.
Ranking employees by making a chart of all possible of the employees for each trait and
indication which is the better employee of the pair.
Management by objectives (MOB): involves setting specific measurable goals with each
employee and then periodically reviewing the progress made. The performance is
evaluated by the department head or immediate boss in quarterly for all employees. They
evaluate annually for permanent employees.
D. Motivation of Employees:
The following methods and techniques are used to motivate the employees:
43
Promotion
Financial incentives
Job rotation
Work sharing
House rent A
House loan
Sick leave
Maternity leave
Ordinary leave
Ordinary leave
Advance leave
Study leave
44
Quarantine leave
Maternity leave
Casual leave
Pay Scales:
BDBL has no pay scales for its own employees. It follows the pay structured of Bangladesh
Govt.
Promotion policies:
It is done on the basis of
ACR
Training Report
Qualification
Viva
Seniority
F. Discipline:
If anybody pays any role against the BDBL, or banking rules or govt. service rules, an inquiry
committee will be formed. If the price proves un-doubtfully, the BOD will punish him or her.
The punishment may be
Held up increment
Held up promotion
G. Retirement:
45
BDBL maintains the rules and regulation of the Govt. for retirement benefits of the employees.
They approve 1 (one) year leave for preparation of Retirement (LPR) the pension will by
calculated in the following wayAt the time of retirement :
Basic salary x 80 %
2
Up to death of employee and after his death his wife will get during her whole life.
Monthly :
One Time :
Chapter : 5
Bangladesh Development Bank Limited has some skill manpower such as engineer,
economist, business executives, lawyer and so forth.
There is a few chance of promotion. The workers are in the same position for a long time.
There is no promotion for them. They work traditionally not take the job as a challenge.
There is no team speed of workforce. They work as usual. Sometime, the important file
and work in freeze if any officer does not give importance on it.
Most of the personnel are not as much experienced and skilled to operate banks activities
in proper way.
47
Employees are not interested to provide the relevant Information that is necessary for
analyzing the performance of BDBL.
Finally contribution of BDBL is the highest in the industrialization of Bangladesh though there
are some problems.
Chapter : 6
Conclusions
&
48
Recommendations
6.1 Conclusions
Overall situation of HR practices Bangladesh Development Bank Limited is not so good. Its HR
policies and practices are different from the private bank. My present study on human resources
practices in BDBL, I have found some positive and negative aspects human resources practices.
They dont have specific deposit & loan recovery target for that they always work easily.
After retirement they get 3 years LPR facilities & provident fund.
Most o the employee of BDBL is not satisfied with the present compensation policy.
Higher management has no commitment to the employee because they have been
appointed by government.
49
The employees are disappointed for lengthy & seniority based promotion they want
promotion as per efficiency
The employees are not properly motivated as like private bank they also dont get bonus
as like private bank.
They cant participate in decision making just they follow higher management direction.
6.2 Recommendations
For effective Human Resource Management Practices, the following issues should be considered
by the respective authorities:
Although we know BDBL is an autonomous body of the organization but the employees
capabilities are deteriorating for lack of proper working environment and unexpected
political pressure. In some cases they are not able to work independently, so Govt.
interferes should be reducing from bank.
Same financial benefits shall be provide to zonal offices and branches offices, if branch
and zonal offices have same benefits and allowances as like office then employee can go
outside frequently over the country where he/she will be posted.
50
Employees are not motivate because there is no motivation techniques and poor incentive
benefit, so facilities should be enhanced and opportunity should be given as like private
bank
There is another problem is that the managing director of BDBL is changed frequently
which creates problems to implement the long term policies. Do managing directors
should be appointed at least 3 years.
Higher management should evaluate the opinion of the subordinate and need to take
decision as quick as possible and the employee emphasis on good work environment
To ensure the good and comfortable atmosphere in the work field for the employee.
51
References
Jamal, Nasimul & Hossain, Akhter Human Resource Management, 1 st Edition, 2006,
Grontho Kutir, Dhaka.
52
Islam, M. Nurul An Introduction to Research Methods, 2nd Edition, 2011, Mullick &
Brothers.
www.bdbl.com.bd
Appendix
Questionnaire
(For Human Resources Management Department)
01. What are the functions of your department?
Recruiting
Training
Posting
Promotion
Retirement benefit
53
Employee welfare
02. How do you perform the job analysis and job description?
03. How do you determine the number of employee for any particular department?
Volume of work
Promotion
Transfer
Employee reference
Rehiring
External:
Advertising
Field trips
Educational institution
Labour union
Monitory groups
54
Evaluation
Interview
Final selection
Placements
05. Do you maintain rules and regulations guided by your own of Govt.?
% of labour union
% of monitory
Reference checking
Written
Viva
Psychological
Medical
Attitude test
Experience
Experience
Interview
Special reference
55
1-6 months
6-12 months
Specific form
Recorded base
Unrecorded base
Special evaluation
Others
Permanent
Temporary
Probation
Performance based
Seniority
Ability
13. In the deciding to promote people, does your organization use criterion that may work against
deserving candidate?
56
Yes
No
Vertical
Horizontal
Both
As per policy
Bonus
House rent
Medical
Mobile phone
Launch
In house
Local
Overseas
57