Attracting and Retaining Staff in the Banking Sector: HRMT 20024 Essay

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ASSESSMENT 3: ESSAY ON ATTRACTING
AND RETAINING STAFF
HRMT 20024

Essay
Introduction
Across the world, banking and financial service sector are facing many essential challenges in
retaining and attracting the talented staff whose presence is very important for every sector
organisation for the growth and prosperity in the future. There is all time existence of the
widespread demand of staff with great talent especially the talent based on technology across the
banking or financial service sector. But these sectors are facing an immense struggling for filling
the vacancies. Retention and attraction of staff have become a top priority for the banking service
industries.
Bank mainly focus on the creation of value through technology platforms, business models and
experiences of customers but now it has become important for the financial services leader to
emphasise on the most significant ingredients that are the talented staff that enables the success
of these platforms. It serves as a good source of creation of values. The bottom line of an
organisation can have a major impact due to the marginal improvements in employee attraction
and retention or reduction in the cost of recruitment. In an industry, retention of employees is of
vital importance. As per the report of PwC, Only 10% of millennials have the planning for
working the long-term. Society for human resources management’s research presents that in
hiring a replacement, an average of $4,129 costs to an organisation if they fail to retain an
employee. It does not include the training and severance of new employee (Paşaoğlu, 2015).
There are numerous challenges which the financial and banking sector industries are facing in
attracting their staff members and retaining them in the company for the long-term. At present,
the staff of the banking sector feels pressure and found it difficult to maintain a balance of work
and social life. It’s a challenge for the banking sector industries as well as employees to have
work-life balance in today's' fast paced and ever changing high demanding workplace. Most
people prefer to have work-life balance, and in this sector people have to devote between 50 to
70 hours of work per week which exceeds typically eight hours a day, five days per week work
schedule which becomes a challenge for the banking sector to attract the candidates that value
work-life balance (Aldaibat & Irtaimeh, 2012).

Retention and Attraction of Staff Members: Key challenges
The workplace culture of any organisation of the banking sector should be such that it attracts its
employees and they feel comfortable in working with such organisation. There should be work-
life balance and flexibility should be offered to them so that they can stay in the company for a
longer period. Paid time off, health insurance, part-time work, job sharing, telecommuting or
working from home, relocation services, employee assistance programs, sick leave using for the
family commitments and parental leave are some of the benefits that should be offered to the
employees so that they can feel proud to be part of such companies and devote their best
performance and time for the success of it. This will also increase the productivity of employees
and their commitments to the organisation.
Banking and financial services sector industries should employ different employee attraction and
retention strategies for hanging their best employees. Professional opportunities for development
should be provided for the creation of more knowledgeable employees and an increase in the
investment of employees in their financial service career (Ibidunni. Et .al, 2016).
The other challenge of banking sector is that the employees are not satisfied with the payment
criteria of remuneration as they find that their salary is not up to the level which should be paid
to them as they require a lot of brainstorming and hardworking time devotion which creates
dissatisfaction among them towards their job and it results in creation of labour turnover. It is
important for the banking and financial sector companies to develop the high rewarding schemes
and different bonus plans so that it becomes a tool for the banking company in attracting its high
professional workers and building motivation among them. Every employee would like to be in
the company which offers exciting rewarding and payment schemes. For remaining in the line of
competition, it is important to have attractive starting salary and opportunities for a bonus, but
beyond benefits of monetary, the value should also be added to the job offer by high lightening
and creating a great culture of the company. If the banking company will start professional
development workshops, team building events, programs of employee wellness then it will make
it stand out the rest sector organisations’, attracting more professional talents towards this sector
and they would be keen to enter in such sector and the existing employees of this sector will be
highly motivated and will work with full enthusiasm (Robin. et. al, 2013).

Banking and financial sector have become a less attractive career option. The industry is facing
increased competition for appointing talented individuals from innovative companies.
Millennials get attracted to disruptive start-ups where they can see the impact of their work and
benefit from the greater responsibilities and flexibilities. Due to this, there are financial
consequences for the firms. The tough business cycle has made it difficult for most of the banks
to continue paying competitive wages to the dealmakers (De Koker.et.al, 2017).
Human Resources planning of banking sector in hiring their staff should be adopted using the
robust optimisation concept. Profit maximisation will be provided by this as this will allow the
new talents entry in the middle of the projects having a positive effect on the overall performance
of the project. This will allow the hiring of individuals as per the needs of the organisation. In
place of adoption of the traditional deterministic hiring process, human resources planning and
hiring should be dynamic concerning the organisational need and changing the environment. So
the adoption of the dynamic hiring process in the banking sector as a human resources planning
will benefit the banking industry in the long-run. This will emerge as a good approach in
attracting the individuals searching for the professional well-developed designation and the
retention ratio of the existing employees (Madanat & Khasawneh, 2018).
The banking sector or the financial services sectors are suffering from the turnover rates, and this
is constantly rising due to the lower engagements level which means that they are less likely to
meet connected with their jobs and therefore, prefers to change their jobs. The financial crisis
emerged in the last few years had negatively affected these industries and the poor reputation has
been developed due to the collapse of some of the biggest financial institutions. Reputation and
value image matters a lot to the individuals before joining any industry and to the staff which is
working in the industry. People would not like to associate their name with the industry which
has a poor image. Many individuals are attracting towards the tech companies such as Facebook,
Amazon, and Google and are moving away from the banking industry (Berk. Et.al, 2018).

The policy of good corporate social responsibility should be applied in the banking sector for
increasing the engagement of staff. The banks having a policy of corporate social responsibility
emerges as good human practices policies as it is employee focused. The CSR policies not only
benefit the customers of the banks and financial institutions but it also makes the employees
attractive and satisfies resulting in the reducing the labour turnover rate (Kiliç, 2016).
The banking industries recruitment and selection process are not attractive as they do not
promote for the vacancies in the sector properly due to the cost-cutting approach, so the
professional and talented people remain unaware of the posts in the sector and bank and financial
institutions lack from hiring the competent persons. There should be proper standard of the
section methods having reliability, legality, utility, validity, and generalizability. The selection
method should be based on evaluating skills, communication, psychological, writing and
technical skills (Robin.et.al, 2013). If the talented professionals are recruited for the job having
some specifications, then it will not only satisfy the employee, but he would like to remain in the
company for a long period which will benefit the banking company only. Some factors are
required to be considered at the time of recruitment including interpersonal skills and
communication skills, teamwork skills, commitment, emotional intelligence, self-awareness,
self-confidence, flexibility, ability to accept direction, loyalty, motivation, enthusiasm, and
initiative. This will provide the banking sector with the recruitment of talented personnel
(Mahmood, 2014). Different recruitment sources can be adopted by the organisation like internal
and external recruitment, direct applicants, referrals, advertisements, internet recruitment,
universities, public and private employment agencies.
The job design is a very important aspect in every sector of the organisation. If there is instability
in the organisational management, then it will result in a high turnover of employees. Friendly
and stable working environment inclined the staff to retain in the company. Quantitate approach
has been applied by the banking sector for managing the employees leading to the employee
disillusion directing to their turnover. Job designing in the banking sector is not proper which is
producing the dissatisfaction among the staff. The identification should be made of the skills
required for performing particular tasks. The clear link should be developed between the
business's strategic goals and job design. On the basis of having a good understanding of the

requirements of the job so that intelligent hiring decisions can be made. This will make
employees be satisfied with the job or the tasks allocated to them as the allocation will be done
as per their experience and abilities. This will enhance the performance of employees and their
productivity level benefiting the banking sector. Effective job design always attracts people and
the staff (Tufail. Et. al, 2016).
Legal, safety and ethical contexts of banking sector industries play an important role in attracting
and retention of staff. No statutory recognition has been made for managing the diversity in the
banking sector. Equal employment opportunities law must be followed by the banking sector
industries and should choose the best person for the job. The banking sector should rigorously
follow sex Discrimination Act, 1984, Racial discrimination act, 1975, disability discrimination
act, 1992, age discrimination act, 2004 it will increase the satisfaction level of the staff. They
will like to retain in the company with such legal policies, and they will also refer other
candidates for the same company. More and more candidates will get attract towards this sector
and will keen to work with such legal and ethical follower industrial sector. Anti-Discrimination
law in the workplace attracts the staff to a great extent they feel free to express their ideas and
feel they the organisation belongs to them (Devi & Narayanamma, 2013).
At present one of the challenges that the banking and financial service sector industries are
facing is the safety of women employee at the workplace. They are suffering from the sexual
harassment at their workplace which includes telling of rude jokes, touching and staring, requests
for date repeatedly and inappropriate comments that constitute sexual assault under the laws of
criminal — making strict rules and laws for those who conduct such behaviour so that safety and
ethical environment can be developed in the working place for all the staff members, not
affecting their performance and they want to remain in such good environment (Robin.et.al,
2013).
The ethical code of conduct and standards in the banking sector are the challenge that needs to be
considered. Disciplinary proceedings, grievance proceedings, electronic privacy and data
protection, whistleblowing, cultural control, pay, new forms of work, non-discriminatory rules in
selection and recruitment are some of the issues of fairness and justice (Vardarlıer, 2016).

Recommendations for the Employees or workers
Therefore, it can be said that it is very important for the banking and financial sector industries to
have effective human resources management policies. Numerous challenges are being faced by
the banking sector covering the shortages of skilled employees due to the burden of long
working hours in this industry making them dissatisfied with their work profile and resulting in
the increment in the labour turnover rates. So it is essential for the banking companies to pay
immense attention in this arena and to make such human resources policies by which the
challenges facing by this sector industries can be overcome, and more and more individuals get
attracted towards the finance and banking sector. The banking companies can retain the staff and
get the referrals from its employees for the new candidates who are possible only when the
existing employees are satisfied with the policies and the working environment of their
workplace.
For attracting and retaining high-skilled employee’s corporate strategy implementation and
operational goals, attainment is not only sufficient, but organisations also need to provide
employee-focused good employment and high involvement practices that will build a positive
workplace experience for attracting and retaining the staff of banking and finance sector. Major
workplace challenges being faced by the majority of banking companies include workplace
legislation, skills shortage, and economic downturn. Competitive remuneration includes
anniversary allowances, options of profit sharing, cash in leave, overtime pay, share purchase
plan, contract completion bonus, car leasing. Good working conditions should be provided. The
reputation of the banking and finance sector is very important for the retention and attraction of
staff. The ethical approach must be there towards employees, improvement in the recruitment
practices, improvements in the culture of the organisation, the greater involvement of employees
at their workplace. The major challenges being faced by the banking sector for attracting and
retaining the employees include skills shortages and competition for the highly qualified staff.
Good and effective human resource planning should be implemented in the sector (Cooper.et.al,
2018).

Conclusion
Ethical, safety and legal contexts must be attractive enough which provide great satisfaction to
the employees. Due to the ineffective job design of the banking sector, the employees are not
well aware of their duties and responsibilities; there exists the ambiguity among them. All this
causes the major dissatisfaction which makes it essential for the banking sector to have such job
design which will improve the performance of the employees. Human resource planning of the
companies should be developed as per the requirements of the employees as well as the banking
industry. So that the talented professional can be recruited at the right designation and bank and
financial institutions can have the well -established and talented professional in their organisation
contributing in the growth and success of this sector and making the high profitability ratio.
Organisation recruitment and selection methods should be attractive enough so that the
employees are satisfied and retain in the organisation. Hence, all the key challenges of the
banking and financial sector should be overcome very effectively and with due diligence and
care so that it can result in attracting the and retention of staff members (Nguyen, 2016).

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