Importance of HRM in HSBC Bank

This document discusses the importance of Human Resource Management (HRM) in HSBC Bank, including strategies for creating value, the influence of regional and national culture on HRM practices, employment models, practices used in Asian/African countries, and the impact of local culture on hiring and firing. It also explores the differences in employment laws when international HRM changes local business systems.

HUMAN
RESOURCE
MANAGEMENT

Table of Contents
INTRODUCTION...........................................................................................................................3
MAIN BODY..................................................................................................................................4
TASK A.......................................................................................................................................4
HR strategy creating Value..........................................................................................................4
TASK B.......................................................................................................................................5
The influence of Regional and National Culture on practice of HRM -.....................................5
TASK-C.......................................................................................................................................5
Employment Model.....................................................................................................................5
TASK D.......................................................................................................................................6
Practices used by HSBC in Asian/African Countries..................................................................6
TASK - E.....................................................................................................................................7
Considering the importance of local culture and HRM practices at the time of hiring or firing
and practices carry out in international HRM..............................................................................7
TASK-F.......................................................................................................................................8
Differences in terms of employment laws when international HRM changes local business
systems.........................................................................................................................................8
TASK G.......................................................................................................................................9
Suggestions to employers regarding HRM practices ensuring the high performance for the
Organization -..............................................................................................................................9
CONCLUSION..............................................................................................................................10
REFERENCES................................................................................................................................1

INTRODUCTION
Human Resource Management refers the process by which the organization employs people,
provide them training, compensate them for their work, develops policies related to people
working and formulate strategies to retain them. In simple terms, it is the practice of managing
and supervising people to achieve their best performance. Human resource Management plays a
crucial role in every company as it not only formulate the policies & procedures and to hire
candidates but also use strategic plans to make sure the right candidates are hired and trained for
the correct job at the right time.
HSBC Holdings plc commonly known as HSBC is British global investment bank and financial
services company. It was originated from hong in British Hong Kong but its present form is
headquartered in London, UK by Hongkong and Shanghai Banking Corporation to act as a new
form of holding company in 1991. This Banking company have its presence in various countries
across Europe, Africa, USA and Asia. Earlier the company's business was organized into 4
groups – Commercial Banking, Retail and Wealth Management Banking, Global private banking
and Global Banking and Markets. But recently HSBC Bank announced that it will merge its
retail and wealth management business with the global private banking.
Report examines how value was created by the HSBC bank using the concept of strategic HRM
and analyse the influence of regional and national culture on the practice of HRM in India. This
report also use appropriate model of employment and state the organizational levers used by the
HSBC to create value. Using the Storey's 27 states what is being practised by the HSBC Bank in
Asian/ African Country, HRM policies or Personnel Management. Further, the report discuss the
significance of local culture in hiring and firing, examines the difference in terms of employment
law in internal and domestic market and provide suggestions regarding HRM practises.

MAIN BODY
TASK A.
HR strategy creating Value
Earlier HR department only focused on recruiting employees, but to create the value strategic
HRM was introduced. Strategic Human Resource Management refers to the combination of
Strategy and HRM. In simple words, it can be defined as the process which is future oriented and
helps in developing and implementing HR programs that address business issues and contribute
in long term goal (Brewster, 2017).
Strategy for HSBC that Creates value is that it creates the work environment which is engaged,
loyal and productive. HRM of HSBC considers some tools while developing the strategic plan
which creates the brand image of the company and attract people to work with them.
Competitive Salaries – Company offers competitive salaries to its employees according to their
experience, skills and performance at workplace.
Enviable Benefit Packages – to attract the talent o work with them company has to offer high
packages with some attractive benefits so that candidate chooses the company.
Promotional Opportunities – Company for its own growth and development have to provide its
employees the growth in their career then only they will be committed to the company.
Training and development – HSBC focuses on providing the best training and development to its
employees so that he can have expertise and in that area and helps Company efficiently achieve
goal.
Employee Autonomy – This is the most important factor that creates value in the company,
HSBC provides its employees autonomy in decision making and suggesting ideas that can be
helpful for companies growth (Shamim and et.al., 2016).
In today’s competitive environment for the company to be in race, it is important for the
company to come up with such HR practices which are innovative, flexible and gives company
competitive advantage over its rivals. HSBC always tries its best to come with such HR practices
that increases the employee’s job satisfaction by providing them flexible working hours, good
compensation. This company also tries to provide such work culture where the employees feel
that they are essential for the company. By satisfying employees, employees work with more
dedication and that results in improved rates of customer satisfaction which results in overall
growth of the company (Michael, 2019).

TASK B.
The influence of Regional and National Culture on practice of HRM -
Human resources management refers to managing the employees effectively in order to achieve
the goals and objective of company. Every country has its own culture and values and that have
impact on HRM practices. Being a global company, HSBC can't take risk of loosing its operation
so company by understanding the culture of the country come with the practices which ensures
that such practices will make its business operation successful.
Security to employees – Each and every person is valuable to company as they contribute their
part in company. Life is unpredictable and company follows this culture in India to increase the
job satisfaction among and provide essence of security to its employees. HSBC, provide
employment security help the company in retaining its employee.
Selective Hiring - Company in India practise selective hiring, which helps organization to bring
the employee who adds value to its company. HSBC have the best HR Department, which helps
the company to hire the right people for right purpose at right time which helps in gaining
competitive advantage (Guest, 2017). HSBC in UK, checks they candidate on three
characteristics i.e. ability, trainability and Commitment.
Fair and performance based Compensation – In India, as there is short in supply of skilled
workforce, HSBC follows this practice as these people add the most value in the company so to
retain them company has to pay them fairly. But if such great financial company has to hire the
world-class people in India, above- average compensation is must. And Company also uses this
practise so that employee develops the sense of ownership and gives the best outputs to HSBC.
Training of Relevant Skills – HSBC highly relies on this practice especially in India, after
recruiting the best people, it ensures that they stay frontrunner in their specific field. To stay in
the business for the long run, company ensures that its employee are completely trained with the
technology.
TASK-C
Employment Model
Employment is the two-way process. It fulfils the goal of both the parties, company gets the
desired employee and employee gets the desired recognition through the job. HSBC Banking

Company uses the employment model that anyone eligible for the job can be employed and will
also get sufficient support in return (Plaskoff, 2017). The employment model used by the HSBC
is flexible and the continuous process, framed to meet the needs of employer and the employee.
This model is also used to support job retention for the employees who are working but need
some support. For the immediate value creation, HSBC needs to focus on three areas: Average
sales price, Client focus and Market Coverage. Discussed below are the top three levers which
creates the immediate values –
Auto Attach – Most of times, the sales personnel of the company do not present an inclusive deal
to the client. Sales personnel of the company follow the path of least resistance. All the proposals
must include add-ons (Boon and et.al., 2018). It is suggested not to miss the opportunity of
putting the entire solution during the initial stage in front of clients. If declined, client will have
increased potential of the services. If accepted, HSBC will realize the maximised average sales
for its immediate value.
Reduce Accounts – It is unreasonable for the sales personnel to primarily on fewer accounts.
Peak sellers and Top Performing companies like HSBC define the ideal customer profile (ICP)
and remain focused on those clients. This enables the company to increase their share of wallet
and move from vendor to partner within most lucrative customers.
Outsourced Sales – Selling Financial services and investments is core to the banking company
and cannot be outsourced. But the aspects of the sales can be outsourced. Peak performers like
HSBC have optimized routes to market with the perfect sales techniques (Delery and Gupta,
2016). Inside sales, the common function is to outsource to generate leads implement campaigns
and support selling services on the field. Alliance with partner can maximise the number of
opportunities for the company.
TASK- D.
Practices used by HSBC in Asian/African Countries
HSBC Bank is global holding company having its operations in various countries across the
world. It cannot practice its UK laws and practices in other countries, for every international
country HSBC has to set some guidelines according to the internal country's culture. For
example, for its operations in India, it has to set guidelines which strikes balance between its own

practices and according to the norms in India. Generally, any organization either follows HRM
policies or Personnel Management practise, in some cases both. In industry specific country like
India, HSBC follows HRM policies which not only provides it competitive advantage and makes
its operations successful in India (John and Taylor, 2016). HRM policies are the norms,
approach, assumptions and values of the company related to managing individual behaviour at
workplace. Discussed below are some policies that HSBC follows in India -
Code of Conduct – Code of Conduct can be referred as company's policies which consist of
vision, mission, objective and norms related to ethics that is to be maintained at workplace.
Designation and work related salaries are paid but company provides cash rewards to employees
on the basis of there performance.
Contract of Employment – HSBC Bank with providing its employees contract for their
employment also believes in the concept of going beyond the contract which refers to not
communicated expectations and beliefs generally they are tends to be informal and ever-
changing gives develops employee faith in the company (Barrena-Martínez, López-Fernández
and Romero-Fernández, 2019).
Non-discriminatory Policy – HSBC Company follows non-discriminatory policy with the
special terms in country like India, because India is country with various cultures where
discrimination on the basis of religion, class and gender takes place. Company ensures to that it
provide same platform to every potential candidate and also take strict actions if anyone is found
guilty of practising discrimination at workplace.
Leave Policy – HSBC Bank provides clear picture about the no. of leaves that a employee is
eligible for, it considers all the national holidays and major festive leaves that employee needs
according to India culture. It also mentions the amount of salary cut if the employee is has not
applied for the leave and in the case of half days (Mahmud, 2019).
Wage Policy – Company follows the relevant rules and laws regarding the minimum wage that
has to be paid to the workers of the company.
TASK - E
Considering the importance of local culture and HRM practices at the time of hiring or firing and
practices carry out in international HRM
Local culture are considered important by HSBC when they are doing recruitment and firing:

To consider local culture while recruiting internationally is very necessary, HSBC believes in
this. complexity of the culture should understand which can help in better international hiring.
Recruiting the right employee for the organization is essential for the organizational success.
Company believe that HR should deal people in equal and fair manner. They recruit and promote
the employees on the basis of their capabilities. HSBC want to recruit who have diverse idea and
full of creativity. This will help in generating new ideas.
Firing can demotivate the employees but sometimes it is necessary for the company to do firing.
So that they can hire effective and more creative candidates. HSBC provide hygienic and safe
working environment to the employees so that they can work efficiently. Company believe that
timely rewards and incentives should be provided to the employees because rewards motivate the
employees to work hard and achieve the company's objective (Mohapatra and Samaddar, 2020).
Training should be provided to the employees to brush the skills of the employees. Training will
teach employees about their roles in the organization and also reduce the confusion among them.
HR ensures that there should be no communication barriers. Lack of communication will cause
delay in reaching towards goal.
In HSBC, HR gives regular feedbacks to their subordinates. They appreciate them if they had
done excellent work and show them about the areas for improvement. Flexibility in the
workplace should be their. They should not always bound with work. Organization should trust
their employees and make them believe that they will help employees to reach to their personal
goal along with the organization goal this will bring motivation in the workforce. If right
candidate will not get selected by HR then this will waste the time and resources because
candidate will given training before assigning work and training cost will go waste if they do not
follow right selection process.
TASK-F
Differences in terms of employment laws when international HRM changes local business
systems
Employment law is defined as the legislation that governs employer and employee
relationships, including individual employment contracts and a large group of statutory
regulation on issues such as right to organize and negotiate collective bargaining agreements,
protection from discrimination, wages and hours, health and safety (Levine, 2016).Various

employment laws when international Human Resource Management changes local business
systems in reference to HSBC Bank of UK are as follows -
Employment Rights Act , 1996 – HSBC Bank follows this act which covers the rights of
employees in situations such as dismissal, paternity leave, maternity leave and redundancy. As
this proves to be the important part of the law hence affects the local business systems (Kianto,
Sáenz and Arambur, 2017).
National Minimum Wage Act, 1998 – The Bank sets out the National Minimum Wage Act for
employees and employers. The government regularly reviews this to keep it in line with the
inflation. This keeps the reality check with the local Banks in accordance to the act implied.
Employment Relations Act, 1999 – The Bank establishes number of rights at work for trade
union recognition, de-recognition and industrial actions through which employees seek help and
receive results what they acquire of.
The Maternity and Paternal Leave etc. Regulations 1999 – Statutory legislation governs the
rights of employees for time off from work when they seek maternity and paternal leave under
this regulation.
Part – Time Workers Regulations, 2006 - HSBC Bank is concerned about the UK employment
law measure requires that employers give people on part-time contracts with comparable
treatment to people on full – time contracts who do the same jobs.
Transfer of Undertakings Regulations, 2006 – The bank is concerned with the protection of
employees as to provide jobs. It focuses on the protection of the existing employee rights and
any employment contracts.
The Equality Act, 2010 – The Bank follows the recruitment process under this act. It identifies
protected characteristics that cannot be used as a reason for any workplace decisions.
Agency Workers Regulations, 2010 – The Bank under this act treats the employees equally in
pay and working time when compared to full – time counter parts who do the same work.

TASK G
Suggestions to employers regarding HRM practices ensuring the high performance for the
Organization -
Providing Security to employees – The Bank should provide security to employees so that they
are not scared of losing their jobs. A formal and informal contract is signed between the
employee and the employer (Otoo, 2019).
Selective Hiring - Hiring the right employees who are capable of the position by providing them
training and committing them to do their work.
Self – Managed and effective teams - This factor should be very considerable at the utmost
priority which not only will benefit the employees in their work, but they will also learn about
managing themselves through effective teams made.
Fair and Performance based compensation – Contingent compensation is the best HR practice
which should be followed by the HSBC Bank. Right people will add the most value to the
company.
Training in relevant skills - This practice states that companies should invest heavily in training
time and budget for its employees. Employers increasingly invest in skills specific forms of
training (Delery and Roumpi, 2017).
Resolving conflict - company should listen and resolve the conflicts faced by the employees
because conflict resolution is very necessary. Conflicts can even demotivate the employees and
affect its productivity.
Job satisfaction - Employees should be satisfied from their job. They should feel happy while
working. HR should see the problem of employees and try to solve it.
Including employees in decision-making - Company should include or involve employees in the
decision-making process because they will feel that they are valued by the organization and will
give innovative or fresh ideas. Innovation is required for the long term survival and for making
profit (Tung, 2020).
Security to the employees - Employees should feel secure while working. They should not feel
any kind of fear because it will affect their productivity. When it comes to security, job security
plays very important role.

CONCLUSION
The following report above elaborate that how the HSBC finance Bank creates the value using
the HR strategies by using the innovative and flexible ways that attract talented employees to
work with the company, by practising these strategies company can retain its employees and it
also discuss the concept of strategic HRM. The report also discuss about the influence or impact
of regional and national culture on practise of HRM and how company come up with some
innovative ways to practise its operations smoothly in India. Report determines the appropriate
employment method practiced by the HSBC Bank and the organisational levers used by the
holding company to create its value. By using the Storey’s 27 points of difference between the
HRM and Personnel Management as a benchmark, states that HRM policies is been practiced by
the HSBC in India because of the country being Industry Specific. Further the report discuss
about that when it comes to hiring and firing do HSBC Company considers the significance and
importance of India’s local culture and HRM practice that needs to be undertaken in general and
the practices need to carry out in transitional/ international subsidiary. It determines the
difference in terms of employment laws when the international HRM changes local business
system by discussing the different laws such as employees’ right act, national minimum wage,
employment relation act, maternity and paternity leave act etc. Lastly, based on the discussion
above the report provides suggestions and recommendations to make HSBC Banking Company
regarding the HRM practices to make sure that the organisational performance is high and have
growth ahead.

REFERENCES
Books and journals
Barrena-Martínez, J., López-Fernández, M. and Romero-Fernández, P.M., 2019. Towards a
configuration of socially responsible human resource management policies and
practices: Findings from an academic consensus. The International Journal of Human
Resource Management. 30(17). Pp.2544-2580.
Boon, C., and et.al., 2018. Integrating strategic human capital and strategic human resource
management. The International Journal of Human Resource Management. 29(1). pp.34-
67.
Brewster, C., 2017. The integration of human resource management and corporate
strategy. Policy and practice in European human resource management. pp.22-35.
Delery, J. and Gupta, N., 2016. Human resource management practices and organizational
effectiveness: internal fit matters. Journal of Organizational Effectiveness: People and
Performance.
Delery, J.E. and Roumpi, D., 2017. Strategic human resource management, human capital and
competitive advantage: is the field going in circles?. Human Resource Management
Journal. 27(1). pp.1-21.
Guest, D.E., 2017. Human resource management and employee well‐being: Towards a new
analytic framework. Human resource management journal. 27(1). pp.22-38.
Harrison, T. and Bazzy, J.D., 2017. Aligning organizational culture and strategic human resource
management. Journal of Management Development.
John, R. and Taylor, B., 2016. Human resource management.
Kianto, A., Sáenz, J. and Aramburu, N., 2017. Knowledge-based human resource management
practices, intellectual capital and innovation. Journal of Business Research. 81. pp.11-
20.
Mahmud, M., 2019. Human resource management of step builders limited and recommendations
on its improvement.
Michael, A., 2019. A handbook of human resource management practice.
Plaskoff, J., 2017. Employee experience: the new human resource management
approach. Strategic HR Review.
Shamim, S., and et.al., 2016, July. Management approaches for Industry 4.0: A human resource
management perspective. In 2016 IEEE Congress on Evolutionary Computation
(CEC) (pp. 5309-5316). IEEE.
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