INSTITUTE OF BUSINESS MANAGEMENT

Assignment No.1

Human Resource
Management
Habib Bank Limited

Submitted to
Sir Shah M Saad Husain

Submitted by
Muhammad Arif (9531)
MBA (Ex)

Dated
October 09, 2010
Table of Contents
INTRODUCTION............................................................................................................................................ 3

VISION STATEMENT...................................................................................................................................... 3

MISSION STATEMENT................................................................................................................................... 3

VALUES......................................................................................................................................................... 3

HUMAN RESOURCE MANAGEMENT IN HBL................................................................................................... 3

ORGANIZATIONAL STRATEGIES..................................................................................................................... 4

CORPORATE STRATEGIES.........................................................................................................................................4
BUSINESS UNIT STRATEGIES.....................................................................................................................................4

ENVIRONMENT............................................................................................................................................. 5

DEGREE OF UNCERTAINTY.......................................................................................................................................5
MAGNITUDE OF CHANGE........................................................................................................................................5
COMPLEXITY.........................................................................................................................................................6

ORGANIZATIONAL CHARACTERISTICS............................................................................................................ 6

THE PRODUCTION PROCESS.....................................................................................................................................6

MARKET POSTURE.................................................................................................................................................6
MANAGERIAL PHILOSOPHY......................................................................................................................................7
ORGANIZATIONAL STRUCTURE..................................................................................................................................7

ORGANIZATIONAL CAPABILITIES................................................................................................................... 9

HUMAN RESOURCE STRATEGIES.................................................................................................................. 10

1. WORKFLOWS.............................................................................................................................................10
2. RECRUITMENT AND STAFFING........................................................................................................................10
3. EMPLOYEE SEPARATIONS..............................................................................................................................11
4. PERFORMANCE APPRAISAL............................................................................................................................11
5. TRAINING.................................................................................................................................................. 11
6. COMPENSATION..........................................................................................................................................12

REFERENCES............................................................................................................................................... 13

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Introduction
Habib Bank Limited is the largest bank in Pakistan. The bank has a network of 1439 branches
in Pakistan and 55 branches worldwide. It has a domestic market share of over 40%. It
continues to dominate the commercial banking sector with a major market share in foreign
remittances and loans to small industries, traders and farmers.

Vision Statement
“Enabling people to advance with confidence and success.”

Mission Statement
“To make our customers prosper, our staff excel and create value for shareholders.”

Values
HBL’s values are the fundamental principles that define its culture and are brought to life in
its attitudes and behavior. It is company’s values that make its unique. These values are as
follows:

 Excellence
 Integrity
 Customer focus
 Meritocracy
 Progressiveness

Human Resource Management in HBL

The HRM department plays an important role in creating value of any company. HBL has
very active HR department which consists of competitive individuals who are engaged in
formulating HR strategies according to the local and global needs and tackling the problems
skillfully in order to keep the pace of success. HBL has been becoming more and more
customer focused organization by providing high level of services. Employees are the main
source of any organization’s success and HR department has been working on this area in
order to keep their employees satisfied with adequate skills available to perform their job
responsibilities.

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Organizational Strategies
There are mainly two types of strategic planning undertaken by the HR department of any
organization.

Corporate Strategies
HBL focus on two types of Corporate Strategies

 Geographic Expansion:
The World has been becoming a global village with the extensive use of technology.
HBL has been moving abroad with geographic expansion in the business.

 Diversification:
It implies that HBL will expand by adding new service lines. With the passage of
intervals HBL introduces new banking services.

Business Unit Strategies

Following are the Business Unit strategies of HBL

 Cost leadership
The aim is to become low-cost leader in banking sectors that is why HBL is providing
effective services in low cost than other banks in Pakistan.

 Differentiation
HBL’s strategy is to provide unique banking services to its customers in banking
sectors to make itself valuable for its customers. This will give them competitive
edge over their customers.

 Focus
HBL has been focusing on its customers and creating awareness that they value the
needs of customers and therefore all the services provided by the bank is customer
oriented.

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Environment
HBL’s dynamic work environment offers diverse opportunities to stimulate ongoing
employee needs and supports career enhancement opportunities. The environment at HBL
is cultural, ethical and challenging that encourages creativity and commitment among
employees. HBL fosters a work environment where employees can realize their potential
whether locally or in the international arena. Thus, HBL enables its employees to achieve
their professional goals while keeping in sync with the bank’s overall objectives.

Degree of Uncertainty
Since HBL is a financial service provider organization. It depends heavily on figures and
statistics. Data is readily available for making the long term as well as short term decisions.
Therefore the degree of uncertainty is quite less as compared to other businesses but due
to the nature of business it may involve high risk for critical decisions.

HBL makes both narrow-scope and broad-scope research and development decisions. Scope
of decision depends on the level of management. Higher the level, higher will be the scope.

Volatility
The environment is highly volatile for HBL. Changes are widely adapted by the organization
in order to keep ahead against their competitors. Versatile and flexible financial products
have been offered which best suits the needs of the consumers.

HBL has revamped its brand through advertisement and other strategies in order to show
high regards for their consumers. The bank is becoming more and more customer centered
by providing financial services in order to adapt the environment changes.

Magnitude of Change
Changes are adapted after analyzing the situation and risk factors. Proper research is carried
out before introducing any change in terms of policies, strategies, products, services etc in
order to minimize the risk.

Since the organization is geographically expanding, changes are done in all the regions.
Current example is the redesigning of Logo, rephrasing of tag line and introducing new color
scheme.

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Complexity
It is very important to have environmental analysis to understand the impact of factors
related to the environment of the organization otherwise the organizational operations may
not run effectively and its component cannot work effectively to achieve the goals.

Following factors are considered in detailed by HBL so that the decisions made are beneficial

 Economic Component
 Technology Component
 Legal Component
 Political Component
 Social Component
 Customer Component
 International Component

Organizational Characteristics
Employee empowerment and training are the top priorities of HR department in HBL and in
this regards several training programs, workshops etc. are carried out so that the operations
can run smoothly and employees feel less stressed while performing their jobs.

The Production Process

Production process is basically converting input into output. At HBL, recruitment is done
carefully and then employees are provided rigorous trainings so that they can work
efficiently.

In order to know the employees their responsibilities, explicit job description is defined. Job
description contains the points of job identification, job summary, chain of command
relationships, responsibilities and duties, standard occupational classifications and standard
of performance and working conditions helps employees at HBL to know their boundaries of
work.

HBL is financial service providing organization and therefore it requires skillful people.
Specific job related training and prior knowledge is required in order to carry out the
operations.

Market Posture
The core function of HBL is same. The concept of banking has never changed despite the
boundaries of banking are expanding and different flexible products are being offered to

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satisfy the consumer needs. HBL uses both “buying skills” and “making skills”. They hire
consultants on temporary basis as well as full time employees who are provided onsite as
well as offsite trainings.

Pay scale is centralized and formal appraisal process is carried out so that employees can be
compensated with respect to their performance.

Managerial Philosophy
In the current economy, organizations that are highly risk taking can leap ahead over others.
Rigid and risk averse organizations cannot get competitive edge over their competitors.

Although HBL used to be an autocratic organization with seniority based pay, top-down
communication channels but now HR policies are being implemented which focuses more
on employee empowerment, formal appraisals on the basis of performance, up-and-down
communication channels. But these changes are being implemented gradually and it
requires some good time so that employees as well as management can adapt to these
changes.

Organizational Structure
At present the Bank operates through one central and 23 Regional Offices and 1439
branches, all over Pakistan. The president and Executives Committee look after the affairs of
the Bank. Each Regional Head Quarter is headed by a Chief Executive and assisted by
General Manager Operations and General Manager Support Services. The Regional Head
Quarter controls the branches in their area.

HBL is highly formal organization with dedicated functional departments. Each department
works in coalition with other departments with harmony. There is an explicit job description
for employees and a centralized pay decisions.

HBL had Internal Control Department (Now Compliance Group) which ensures proper
controls in the organization. All the instructional and informational circulars are issued by
consulting them.

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Organizational Chart

Chairman

President

Board of Directors

SEVP SEVP Finance, Audit

SEVP Corp. Banking SEVP Asset Remedial

SEVP Retail Banking SEVP Credit Policy

SEVP Corporate Banking,

financial institute & Project
Finance

Centralized Decision Making

All the decisions are made at the top management level and the subordinates have to obey
these decisions. This trend in the decision making shows a pattern of rigidity in the structure
of HBL.

Downward Communication
Downward communication is the message and information sent from top management to
subordinates in a downward direction. Managers can communicate downward to the

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employees through speeches, massages in company publications, information leaflets,
tucked into pay envelops material on bulletin boards, policy and procedure mandates. The
same pattern is followed at HBL.

Chain of Command
The chain of command is an unbroken line of authority that links all persons in an
organization and how who reports to whom. In HBL chain of command is clear and every
employee knows their direct supervisor and to whom he can report.

Organizational Capabilities
It is the organization’s ability to manage people and resources to gain competitive
advantage over others. It focuses on internal processes and systems for meeting customer
needs. It creates organization-specific competencies that provide competitive advantage
since they are unique. It ensures that employee skills and efforts are directed toward
achieving organizational goals and strategies

Following are some of the factors due to which HBL is getting competitive edge over others

 A skill or capability that enables HBL to conceive and implement its strategies.
 The officers of HBL are considered as one of the most able professionals in the
banking industry.
 Highly secured data solutions
 Largest commercial bank in Pakistan with the network of over 1439 domestic and
international branches.
 Always on the look to improve its services both to the domestic as well as overseas
customers.
 24 hours cash access and safe payment products for high value transaction.
 Customer enjoys the services at the residential localities.
 Latest software and financial solutions
 Extensive use of Information Technology

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Human Resource Strategies
These are the six major HR strategies which can be found in any large organization.

1. Workflows
2. Recruitment and Staffing
3. Employee Separations
4. Performance Appraisal
5. Training
6. Compensation

1. Workflows
HBL is maintaining a mix of short & long term goals to minimize the cost and to maximize
the profits along with the competitive edge over others. These are some of the measures
which are highly considered in this regards.

 Risk Management
 Unified IT System
 Intensive Training and Professional Recruitment
 Re-organization of the Consumer and Retail Banking Businesses
 IT system enhancement
 Product offering enhancement
 Advancement of operations in urban areas
 Explicit job descriptions

2. Recruitment and Staffing

The recruitment and selection process starts with employment planning. This process starts
with the planning of human resource that would be required for current as well as future
positions.

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Selection and recruitment process is carried out tactfully and all the future prospects are
identified while hiring the right candidate. Skills, personality, attitude, knowledge and every
aspect of the candidate is judged carefully during the recruitment process.

3. Employee Separations
HBL has offered the voluntary retirement schemes for the employees in the form of Golden
Hand Shake or newly coined term Voluntary Separation Scheme (VSS). This scheme offers
what it calls the special incentive to the staff that would opt for the scheme by providing
them a lump sum amount equals to the salary of 12 months at the time of separation.

Employees having more than decade of services are entitled to the pension plans so that
they will have no financial obligations after their retirement period.

4. Performance Appraisal
Evaluating an employee’s current and past performance relative to its performance
standards is called performance appraisal.

A process that consolidates goal settings, performance appraisal and development into a
single common system to ensure that employee’s performance is according to company’s
aims is called performance management.

Ratings as practiced in HBL consist of following five kinds of factors. These factors are
considered while reviewing employee’s performance and making formal appraisals

 Productivity
 Individual \attributes
 Technology
 Customer Service

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  Personal

5. Training
Training is the process of teaching new employees the basic skills they need to perform their
jobs and development is result of that training.

Training Processes:
HBL follows five steps process of training and development

 Needs Analysis
Identify job performance skills needed, assesses skills of prospective trainee’s and
develop objectives.

 Instructional Design
Produce the training program content, including workbooks, exercises, and activities.

 Implement the program

Providing the training close to real life situation so that it can be implemented by the
employees while performing their jobs.

 Evaluation
Assessing the successes or failures of program.

Training and Development Programs:

Following training and development programs have been practiced at HBL for the
employees

a) Management Trainee
HBL’s Management Trainee (MT) program looks for highly motivated individuals who exhibit
the potential to excel as future leaders. At HBL, the MT program offers extensive interactive
classroom training, on the job rotations and personal mentoring from senior management
to provide a comprehensive learning experience.

b) Management Associate
HBL’s Management Associate Program is a training and rotational program focused on
dealing with branch banking requirements. It provides accelerated development
opportunities across HBL’s branch network of Retail, Corporate & Commercial banking.

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c) Cash officers
Candidates in this program are the bank’s ambassadors and must have exemplary skills in
dealing with clients. The program involves an extensive one-month training period based on
branch banking operations before placement in the branches.

6. Compensation
The salaries, rewards, bonuses, and incentives on the basis of job and performances are
compensations.

HBL’s compensation and benefits strategy combines the need to maintain a high
performance culture along with market competitiveness. According to performance each
employ gets benefits and compensation. Tenure duration is less preferred as compared to
the performance of employees. Employees are paid in two forms

 Direct Payments
These are the payment in the form of wages, salaries, incentives, commissions, and
bonuses.

 Indirect Payments
This mode of payment includes the benefits and perks that are given to the
employees for example medical, car, insurance, residence, car fuel, easy loans etc.

References

 http://en.wikipedia.org/wiki/Habib_Bank
 http://www.habibbankltd.com/about-us-our-brand.php
 http://www.habibbankltd.com/downloads/pdf/annual/2009/financial-statements-group.pdf

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