Academic journal article Indian Journal of Industrial Relations

HRD in Emerging Economies-Research Perspectives in Indian Banking

Academic journal article Indian Journal of Industrial Relations

HRD in Emerging Economies-Research Perspectives in Indian Banking

Article excerpt

Introduction

Indian banking systems has undergone rapid changes in the decade of the 90s. Changing banking sector in India offers huge opportunities and with the opportunities come the challenges. In the wake of greater financial deregulation and global financial integration, the challenges to survive and develop in this global economic scenario, banks could not afford to ignore the HRD facets. However, it is change, and especially the rate at which change occurs that largely influences the HRD hybrid that any organisation adopts. Techno-sophistication has facilitated the speed of change in banking. The wisdom about the important role that HRD plays for organisational success has been developed over the years and finds its relevance even more today. The changing dynamics have sketched a new role for HRD in the organisations. Trends in managing people in this dynamic industry reflects emergence of the most critical issues in lieu of the enormous opportunities spun off by the market. As the entire Indian banking industry is witnessing a paradigm shift in systems, processes, strategies, it would warrant creation of new competencies and capabilities on an on-going basis, thus, demanding in-depth studies. Researches enhancing the understanding of paradigm shift in Indian banking sector especially those directed towards change are very limited. It is important to realise emerging patterns in Indian banking and HRD in Indian banking systems.

Emerging Scenario in Indian Banking & HRD

Relationship between importance of HRD and its effect on the organisational performance have been established much earlier. HR efforts like training and development for new breed of bankers is crucial while managing human factor for banks. According to Asian Development Bank (1999), India needs to accelerate structural reforms directed towards its financial and capital markets, concentrate on infrastructure and public finance consolidation and strengthening support for human resource development to ensure sustainability of reform process in banking sector that have impacted the sector extensively (Reddy 2005). There is need to focus on developing human resources to cope with the rapidly changing scenario. In transforming Indian banking into a vibrant system, initiatives would not work unless quality human resources are available (Jalan 2001a, 2002b). HRD is the key to the success of any organisation and that success lies in how efficiently the organisation manages its human resources and adapts to change, matches with the global standards, evaluates on an ongoing basis continual up-gradation in the organisation (Gupta 2003). Banks require quality human resources and that would be in serious trouble unless quality HR is retained. HR needs special focus in terms of attracting, retaining and motivating human resources. Quality of human resources should be commensurate with the ability of banks to deliver value to customers. Banks should emphasize on the need to streamline human resource development strategies with business strategy (Kamesam 2004). It is the impact of change, technology and challenges of enhancing the quality of existing manpower and explaining importance of changing HRM in the Indian banks (Leeladhar 2005) which is set to face more challenges (Nair 2006).

Dynamism in Indian banking can be attributed to the challenges like upward direction of interest rates, demanding customers, financial inclusion, technological advancements, competition for human talent and efficient utilisation of a bank's resources (Financial Express 2010). Other challenges before Indian banking sector, according to Kamath et al. (2003) are changing needs of customers, coping with regulatory reforms, thinning spread, maintaining high quality assets, management of impaired assets, keeping pace with technology upgradation, healthy bottom lines and increasing shareholder value. The drivers of dynamic changes offer challenges, which need to be addressed to unleash the competitive advantage offered by the Indian banking sector and thus contribute to invigorate banking sector's growth. …

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