Unibank HRM Strategy - Case Study Example

Case Study – Unibank The case of Unibank decision’s to enter the telephone banking sector by switching a significant proportion of its general account management and enquiry activity to a dedicated call centre, named UniCall that resulted in the closure of many smaller, unprofitable branches and the consequent need for redundancies is a normal business phenomenon where business organizations have to transform its structure to adapt to the new realities of the industry. In the case of Unibank, competition was intensified by the arrival of new entrants in financial services that made the setting up of a call center, Unicall, and eventually online banking an imperative if it intends to remain relevant, competitive and profitable in the banking sector. Strategy and HR In the case of introducing UniCall, Unibank was headed towards the right direction strategically. New entrants under established brands with innovative service are already in the market bringing with them the convenience of banking. If Unibank will not introduce Unicall, it will eventually fade into obsolescence that will undermine the bank’s existence. In short, Unicall was a business imperative to keep the business relevant in the market. What the HR was lacking is preparation for change or Change Management when it restructured itself in introducing Unicall. Change management Change is inevitable especially in a business setting. Factors like the external and internal environment precipitates the need for change and the organization has to respond to remain viable and competitive as a business entity. According to Murthy in his book Change Management, change is “to make or become different, give or begin to have a different form, dissatisfaction with old and belief in the new” (2007: 7). There are two factors that bring about change, the external and internal environment. The new entrants may be considered as the external factor because it precipitated the change of Unibank’s structure of putting up a dedicated call center. Unicall’s development can also be considered as an operational change because it is a response to organizations need to “improve quality, quantity, timeliness, unit operation cost of operations in developing products/services and improve the existing operations to perform better keeping the organization’s goals the same” (7). But implementing and managing change is not easy. In the case of Unicall just like in any other oganisation, people who are accustomed to their old ways are often hesitant to change. In fact, the biggest obstacle is change is often the internal factor that comprises 81 % of the time compared to the external factors that is only 19% of the time (Murthy, 2007: 19). The labour union and employees may have resented the closing of many small local branches but the biggest impact of this change was in the performance of Unicall employees which was beset by many problems due to the new work arrangement that the spin off has brought. Such, people are a major focus in implementing change management which Unibank should have prepared before fully introducing Unicall. People are the major focus of organizational change because “it is the people who will ultimately cause the change to be a success or a failure. The implications of change on individuals are important without which we can never really hope to manage large scale change effectively” (Murthy, 2007: 23). Resourcing (HR planning; recruitment; selection and flexibility) Unibank did the right thing in HR planning when it attempted to redeploy existing employees when possible, but also needed to recruit new staff to work in the national call centre. It was also mindful of the relatively high unemployment rates in the West Midlands that UniBank decided to locate UniCall just outside Birmingham. Unibank was conscious enough to realize that employees will be dislocated with the closure of many small local branches that it attempted to redeploy them to avoid economic dislocation among its employees. Unibank failed however in recruiting (and along with it selection and flexibility) new employees when the demand for the new service (call centre) increased. Its inability to fill in the staffing requirement is inexcusable considering that there is a high unemployment rate in the West Midlands and such, there is enough pool of human resources that could have been recruited to fill in the staffing needs had HR been aggressive enough to recruit prospective employees. HR’s inability to fill in the required additional staff aggravated the already problematic situation in Unicall because the workload that made the employees work ‘like battery hens’ fed the discontentment of the workforce that they resorted to redirecting to one of their numbers that made them all to appear busy whilst only one is actively taking calls to have informal breaks. This is not a healthy development in the call centre because understaffing burns employees out and breeds unprofessionalism (Durai 2010). Employee development The mere redeployment of employees without appropriate orientation could be also damaging to the company. The overlook on employee development in Unicall aggravated the already problematic situation. As a result, service level at the call centre was low in terms of the quantity calls answered and the quality and accuracy of customer interaction because new employees were ill trained to take in calls. In addition, they were also discontented with their redeployment and being such, demotivated to do quality work. Attrition level was also high because employees are beginning to look at their jobs as career dead end and “too confining”. This brings to mind that one way to motivate employees is to provide them with an engaging and interesting job as Herzberg puts it (1987). Performance and reward management With how the case was presented, it seems that the case already assumed that implementation of a pay structure is already enough to motivate and make employees perform. What is odd at Unicall from the case is that it has a pay structure but does not have performance management system in place to base that pay. It brings to mind that regardless of how employees perform, they are going to be paid the same which explains the pay structure has no bearing in motivating employees. Reward structure is useless if employees are unhappy with the work arrangement and do not know the basis of such reward scheme (there is no performance management system in place to begin with but just a structure of pay) (Bayat 2011). The complaints of new staff against senior employees and other issues are just a by product of a demotivated workforce who are unhappy with their jobs. The standardised payment scheme is also not a motivator but in fact promotes complacency because employees will get uniform a starting rate of £20000 (to new recruits) and rises by annual increments until they reach the top point regardless how they perform. This ineffective pay structure to reward performance is aggravated by the fact that merely relying on economic factors to motivate employee is not enough because it only addresses the biological need of people which the most basic of Maslow’s Hierarchy of Needs (Hoffman 1992). To make the reward management effective, it also has to respond to other needs such as security needs up to self-actualization and a professionally fulfilling work. As it is, work at Unicall is perceived as drudgery by the employees. Employee involvement and participation The employee issue at Unicall such as call avoidance could have been minimised if not totally removed had there been enough involvement and participation prior to the introduction of the call center. Unibank’s HR failed to recognise that the redeployed employees will of course resent the new arrangement because they were oblivious why it happened. Had there been enough consultation and employee participation prior to the introduction of Unicall, employee discontent would have avoided and these employees who are now presenting as problems could have helped Unibank in the transition of Unicall had they been involved in the process. Conclusion To address the issue at Unicall, HR must go to the bottom of everything - employee are resentful of their new work arrangement and looked at their jobs as career dead end which is an issue of employee involvement and development that resulted in the poor quality of work. The other issues are mere offshoots of these bottom line problems which could easily be resolved after the basic issues have been resolved. Reorientation about Unicall should be made to all employees to make them understand that Unicall is a growing department in Unibank and a new trend in banking sector and being such, there is a career in Unicall contrary to their perception that it is a career dead end. Employee issues such as understaffing must also be aggressively addressed by recruiting more qualified employees. Performance management system must also be in placed such as appraisals to base the reward system as well as to get feedback from employees about their jobs where management can address performance issues the moment it arises (Selden 2011). Inefficiency and low service quality can then be addressed after these underlying issues are resolved. The abovementioned issues have to be resolved first because they contribute to employee discontentment which prevents employees from engaging in the company. When there is already less or little resistance and discontentment among employees, HR must implement retraining and retooling of its employees. Along with training is the development of standardised systems and procedures so that response and service are uniform in all areas of customer service in Unicall. This will remove the relativity of response where different agents give different information and prevent employees from redirecting calls that suffers the service quality of the call centre. Also, providing job rotation through giving variety of assignments and work autonomously were reported to yield higher level of job satisfaction and contribute more to the success of the department and such should be practiced in Unicall (Musselwhite 2011). Having addressed the issues at Unicall by using HR management implements, the problems that besets Unicall will be lessened if not totally removed that will make its employees productive and the company competitive. Bibliography Bayat, R. F. (2011). Impact on the Productivity of Human Resources Management, Performance Evaluation.  Australian Journal of Basic & Applied Sciences.  5(12): 1629-1635. Durai,Durai Pravin (2010), Human Resource Management. . Dorling Kindersley, India. Herzberg, Frederick I. (1987). One more time: How do you motivate employees?  Harvard Business Review, 65.30 (1987):48-61. Hoffman, E (1992). The Last Interview of Abraham Maslow. Psychology Today 25(1): 68-89. Murthy, C.S.V. Change Management. Global Media, 2007.  Musselwhite, C.. (2011, September). CREATING A CULTURE OF MOTIVATION. T + D, 65(9), 46-49,6.  Selden, Sally; Sowa, Jessica (2011). Performance Management and Appraisal in Human Service Organizations: Management and Staff Perspectives. Public Personnel Management, 40(3):251-264 Read More