A Comparative Study of Human Resource Management in

Public Sector Banks and Co - operative Banks: with

Special Reference to Latur District

A Synopsis

Submitted In
Partial Fulfilment for the Degree

of

Doctor of Philosophy

Supervised By Submitted By
Dr.G.P. Kapse Panchakshari Someshwar Rajkumar

Department ofCommerce & Management Science

Faculty of Commerce
Swami Ramanand Teerth Marathwada University
Nanded (Maharashtra), India
May, 2019
 INTRODUCTION

In today’s world behind any production of product or service there is an

human mind, effort and men working hours. Any product and service can be
produced without the activity of human being. Human being is the basic thing
for making or construction of anything. Now a day`s, many people claim
that machines and technology are replacing human resource and reducing
their role or effort. However, indeed, machines and technology are created
by the humans , they need to be operated and at least supervised by
humans. Because of this reason, companies have continuously been
searching for talented, skilled and professionals for further improvement
of technology, which again have to be controlled and monitored by
humans to bring out product or service.

Each organization or banking institution desires to have skilled and talented

people to make their institution more effective than their competitors.
Humans are very important assets for any organization rather than land and
buildings, without employees no activity in the organization can be done.
Machines are meant to produce more goods with good quality but they
should get operated by the humans only.

According to Torrington & Hall ( 1987) , Human Resource Management is a

series of activities which firstly enable working people and their
employing organization to agree about the objectives and nature of their
working relationship and secondly ensures that the agreement if fulfilled.
[p. 49]

Edwin Flippo defines, HRM as “planning, organizing, directing, controlling of

procurement, development, compensation, integration, maintenance and
separation of human resources to the end that individual and organizational
goals are achieved.

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Decenzo and Robbins, HRM is concerned with people dimension in
management. Since every organization is made up of people acquiring their
services, developing their skills, motivating them to higher levels of
performance and ensuring that they continue to maintain their commitment to
the organization is essential to achieve organizational objective.

While Miller (1987) suggest that “ HRM relates to those decisions and
actions which concern the management of employees at all levels in the
business and which are related to the implementation of strategies directed
towards creating and sustaining competitive advantage” [ p. 352]

For effective growth of any organization combined efforts of people is

required so that monetary and non- monetary resources are utilized properly to
achieve the objectives in proper way. In 1958, The Government Employees
Training Act came into force for effective and legitimate training and
development of employees.

The importance of HRM is very important in banking sector. The essential

function of bank is to provide services related to the storing of deposits
and the extending of credit. The evolution of banking dates back to the
earliest writing and continues in now a days where a bank is a financial
industry that provides banking and other financial services. Banks are
backbone of the financial services.

With the growing awareness of proper HRM in banking industry, it has grown
into an important activity. Today the head of HRM is an essential member of
the senior teams of any well doing business. It is focused in the role of staffing,
performance management, training and development and compensation .

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 OBJECTIVES OF THE STUDY

To evaluate the HRM practices and policies adopted by banks for further
development.
To identify the process and techniques of Human Resource Management
in banking industry.
To know the organizational structure where HRM is to be implemented.
To trace different areas where HRM is responsible for improvement and
better functioning in banking sector.
To evaluate the various Human Resource Management functions in
banking institution.
To give suggestions to improve HRM practice in Public sector and co-
operative banks in Latur city.

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 REVIEW OF LITERATURE

Abdul Kadar masum, md . Abul kalam azad & Loo- see Beh (2015), examines
that HRM practices are a quality component. The impact of HRM practices on
banks will lead to higher performance scores. For this data of 4 8 banks are
taken from Bangladesh over the period of 2004-2013. The results shows that
foreign banks are still leading in achieving the growth with compared to
local banks. However, considering HRM practices as quality indicators, foreign
banks progressed by 2.6% annually. Thus, results show that, while local banks
possess an acceptable level of performance in terms of their operations, their
HRM practices must be improved in order to deal with competition and
modernization of banks.

Ahmed Mustafi, Tanzia Rahman ( 2016) found that HRM practices in the
field of banking sector is very important part. It evaluates and compares
existing human resource management activities of the employee like job
analysis, human resource planning, talent acquisition, training and
development , performance appraisal , compensation.

Dr. Mallikarjuna N .L, (2014), Economic growth of any country mainly

depends on natural resources, the rate of capital formation and development
in technological areas. However, HRM is the Important factor to build and
develop any economy. It has been considered that growth and progress of
Any nation depends on the quality of manpower. HRM is the process which
helps in motivating the employees, provides skills and knowledge , help in
changing attitude of employees, and therefore contribute to overall
performance and progress of banking sector.

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Dhananjay B. Bagul ( 2012), found that In the era of globalization, the
sustainability of each and every commercial organization has become a
challenge and hence banking industry is also facing the same problem.
Earlier days, since independence banking sector has seen various reforms, but
unless and until some yardsticks are not there, their existence will be a
problem. This is exploratory type of research which explores about various
HR Practices in general banking industries. There is no separation between
them as Co - operative Banks, Reserve Bank and Public Sector Undertaking
Banks. The reason behind is that, all banks are functioning as per the guidelines
and framework of Reserve Bank of India. There is need for multitasking and
multi-skilled employees in banking sector. On account of giving better
services banks are a-breasting newer technology such as e-banking,
networking banking, ATM’s etc. Though software’s are available still we
find that customers needs and expectation from banking industry are not
been fulfilled, the result is employees of banks are always complaining that
they are working under stressful conditions and finding difficult to cope with
the work, therefore there is a great scope for training these peoples for
controlling these emotions, restructuring of these feelings and change the
attitude to the positively.

Esha Mehta (2016), analyzed that properly the competition is going on high
scale in banking sector. In such competition only few competitors can persist.
New & complex techniques and fast moving world has forced banks to
adopt various changes and adjust themselves in changing environment.
Since every human being had potential to do extraordinary things and to
motivate him to develop , to understand and to utilize his/ her potential ,
bank should provide him / her proper knowledge and growing environment
and this is possible only if effective and efficient HRM practices, which
would maximize the value of work and minimize the cost within any
organization. But there was no single practice to which all organizations
should aspire, but to some extent , each firm must have a distinguishing
human resource management

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System that represents core competencies required for the survival and
Sustainability of that particular organization. Best for one may not be best for
other. Hence, in this present competitive world, management of human
resources had been a matter of crucial determination of success for the
banking industry. Better management of human resource had been more
earnestly felt as a vital, in recent decade as before.

Gomez- Mejia et al (2010), examines that the field of HRM is still progressing.
A strategic HRM policies mainly depends on designing its human
resource management systems. The HR choices are work flows, employees
separations performance appraisal, training, and career development,
compensation , employees relations.

K C Chakrabarty ( 2012), informs that Human Resource Management is

important for banks because banking is a service industry. Management of
people and management of risk are two key challenges facing banks. How you
manage the people and how you manage the risks determines your success in
the banking business. Efficient risk management may not be possible without
efficient and skilled manpower. Banking has been and will always be a "People
Business". Though pricing is important, there may be other valid reasons why
people select and stay with a particular bank. Banks must try to
distinguish themselves by creating their own niches or images, especially in
transparent situations with a high level of competitiveness. In coming
times, the very survival of the banks would depend on customer
satisfaction. Those who do not meet the customer expectations will find
survival difficult. Banks must articulate and emphasize the core values to
attract and retain certain customer segments. Values such as "sound",
"reliable", "innovative", "international", "close", "socially responsible",
"Indian", etc. need to be emphasized through concrete actions on the
ground and it would be the bank’s human resource that would deliver this.

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Mac Duffie ( 1995), found that innovative human resource practices are
likely to contribute to improved economic performance of banks only
when three conditions are met ; when employees possess knowledge is
skills that managers lack ; when employees are motivated to apply their
skills and knowledge through various efforts and when the firm’s
business or production strategy can be achieved when employees
contribute to such efforts.

Rajwinder Singh ( 2013 ), analyzed that efficient human resource

management is one of the most essential requirement for survival in the
competitive world. There is huge competition in banking sector also. Human
resource management is linked with human resource development. To bring
out the best in a man is the essence of human resource development. HRD
is the process of increasing the capacity of human resources through the
development . It is a process of adding value to individual , teams and the
organization as a human system. Human resource management means to
empowering people and enabling them to use their power for development
of the organization to which they belong. It refers to developing
proactivity and capacity to embrace larger issues. Considering the
importance of human resources, they are now being treated as assets which
are most precious for the survival of any organization. New values are being
added . There has been shift from traditional master slave relationship to the
modern trusteeship system ( in which employers and employees are
considered as partners investing their wealth an labor ) and from
traditional salary administration to the new human resource system (HRS).
with the human resources being a part of an organization, HRS is a
subsystem of larger system i.e., an organization and human resource
development is the center of HRS and most vital for the organizational
advancement. Human resource development includes both the development
of the people and development of an organization.

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Shalini Shukla ( 2014 ), found that the Indian economy is one of the fastest
growing economies in the world irrespective of various difficulties. Thus,
HR possess the biggest challenges to the public sector banks. Changes in
technology, customer preferences, regulatory framework etc. forced to shift
to HRM . The major challenges faced by HR manager in public sector
banks is to cope with environmental changes for competitiveness. Indian
financial Sector has undergone a rapid transformation since its inception.

Supriya Balasahed and Prof. U .M. Deshmukh ( 2015 ), analyzed that people
are the direct factors of productivity of its services and are its sole
consumers. To utilize the employee’s skills and knowledge , proper ,
effective and efficient human resource management practices are required.
It helps in determining the employee selection and recruitment, training
and development , salaries and wages , job analysis methods , performance
appraisal, employees participation, indicators to measure their levels of job
satisfaction.

Zulfqar Bowra and Kabir Niazi (2011), found that HR practice and
employee’ s performance has positive and significant relationship and its
very important for banks to adopt the HR policies to affect the
employee’s performance and dedication which will lead to overall
performance of banks.

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 Research Methodology

It is a science of studying how research is done scientifically. In research

methodology we study certain steps which are adopted by researcher in
studying his research problem along with the logics associated with them.
Research methodology is used to collect information and data for making
the business decisions. The methodology may include various publication
research , interviews, surveys and other research techniques adopted to
collect the information which include both present and historical
information.

Kothari (2004) defines that the research is an original contribution to the

existing stock of knowledge making for its development. The systematic
approach concerning generalizations and formulation of a theory is also
research. As such the term ‘research’ refers to the systematic method consisting
of enunciating the problem, formulating a hypothesis, collecting the data,
analyzing the facts and reaching certain conclusions either in the form of
solutions( s) towards the concerned problem or in certain generation for some
theoretical formulation.

Research Design

Research design is basically a outline or structure in which various actions are

planned for collection and analysis of data and information for research progress
in such a manner that it gives relevance to what we are doing. Research design
should be good as it will shows the accuracy of the work done while conducting
the research activity. Most important is that the research design must be
practical.

In fact, the research design is considered as the conceptual structure within

which research activity is proceeded; it constitutes the blueprint, outlines,
frames for the collection, measurement and analysis of data or information.

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According to Kothari (2004), “ the research design is the conceptual structure
within which the research is conducted; it constitutes the blueprint for the
collection, measurement and analysis of data. As such the design includes an
outline of what the researcher will do from writing the hypothesis and its
operational implications to the final analysis of data. So the research design can
be defined as a plan, structure and strategy of a research to find out alternative
tools to solve the problems and to minimize the variances.”

Data Collection

1) Primary Data :- Primary data will collect from bank employees at

different levels from top level to low level. Various methods of
interviews like telephone interview, questionnaire interview, survey,
personal interview will be used to collect information.

2 ) Secondary Data :- In secondary data , information will be gathered

from different sectors like -:

Magazines
Websites
Journals
Newspapers and periodicals
Various publications
Reports

Tools for Analyzing the Research

Various statistical tools will be applied to analyze the collected data and
information . main techniques to be used while working with the data are
Central Tendency, measurement, diagrams, frequency measurement,
variance, regression , dispersion and various other statistical tools.

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Sampling

This is an analytical study about human resource management in the

banking sector . For this study Public sector and co- operative banks will be
taken in to account

Public sector banks:-

State bank of India, Latur Branch

Canara bank, Latur Branch

Co-operative banks:-

Sidheshwar Nagri Sahakari Bank

Purnwadi Nagri Sahakari Bank

Source area :- Source area for this will mainly be the employees and
managers of the bank.

Sample Size: - 200 employees

Sample Unit :- Latur City only

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 Hypotheses of the Study

The hypotheses of the following study are:-

1) Human Resource Management enhances the performance of bank

employees.

2) Negligence of Human Resource Management negatively affects the

growth and improvement of bank and its employees.

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 Chapter Scheme

Chapter: 1- Introduction

Chapter: 2- Review of literature

Chapter: 3- Research methodology

Chapter: 4- Analysis of HRM in selected public sector and co-

operative banks in Latur city.

Chapter: 5- Comparative analysis of HRM in selected public

sector and co-operative banks in Latur city.

Chapter: 6- Suggestion / Recommendation

Chapter: 7- Summary of Conclusion

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 BIBLOGRAPHY

Abdul Kadar Muhammad Masum, Md. Abul Kalam Azad and Loo-She
Beh (2015), “ The Role Of Human Resource Management Practices
In Bank Performance “, http :// doi.org // 0. 1080/
14783363.2014. 1002762, pp. 382-397.

Ahmed Mustafi, Mohitul Ameen, Tanzia Rahman, Nusrat Jahan

( 2016),” HRM Practices Of The Banking Sector In Bangladesh : A
Study On Private Commercial Bank “ vol. 6 , no. 3.

C.R .kothari (2004), Research methodology: methods and techniques”,

New Delhi.

David A. Decenzo and Stephen P. Robbins, ” Fundamentals of Human

Resource Management. ”

Derek Torrington and Laura Hall , “Human Resource Management.”

Dhananjay B. Bagul , (2012) , “ Innovative Human Resource

Management Practices In Banking and Financial Sector For Ideal
Working, IBMRD’S Journal Of Management And Research, “ vol. 1

Dr. K.C. Chakrabarty (2012) , “ Human Resource Management In

Banks – Need For a New Perspective,” Deputy Governor of the
Reserve Bank Of India, at the HR conference of public sector banks,
June 2012, Mumbai.

Dr. Mallikarjuna. N .L (2014) ,” Human Resource Development In Co-

operatives : A Theoretical Understanding ,” International Journal Of
Business And Management , vol 16 , issue 11, pp. 01-05.

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 Esha Mehta ( 2016), “ Human Resource Management In Banking
Sector,” International Research Journal Of Engineering, IT and
Scientific Research, vol.2, pp. 90-97, issue 7.

Edwin Flippo, “Principal Of Personal Management.”

Gomez Mejia et al, (2010),”Managing Human Resource; New Jersey

Mac Duffie J. (1995), “Human Resource Bundles and Manufacturing

Performance organizational logic and flexible production system in
The world auto industry, Industrial and Labor Relations Review, vol.48
no.2

Rajwinder Singh (2013 ), “ Human Resources Management in the

Indian Banking Sector ”,http://dx.doi.org/10.4236/shrss.2013. 13004 ,pp.
21-28.

Selvaraj (2009), “Total Quality Management in Indian Commercial

Banks: A Comparative study , Journal of Marketing And
Communication ,
4 (3) pp. 59-70

Shalini Shukla (2014),” Emerging Issues and Challenges of Human

Resource Management in public sector banks of India, Journal Of
Social and Behavioral Science , pp. . 358- 363

Panchakshari Someshwar Rajkumar Dr. G.P. Kapse

( Research Student) ( Research Guide)

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