Last Updated 16 Jul 2021

Training and Development in Banking Sector – Research Articles

Category Bank, Banking, Motivation
Essay type Research
Words 3006 (12 pages)
Views 601
Table of contents


Banking sector of Pakistan is characterized by the high competition and in order to survive in the market place, employers have understood the need for ongoing training and development to equip their employee to better cope up with the demands of the dynamic environment today. This study seek to determine the impact of this training and development on motivation and job involvement along with what training methods are widely used in the banking sector of Pakistan. The primary data for this study was collected through a structured questionnaire that was tailored with the help of literature.

The questionnaire comprised of 37 items, categorized into 5 sections, which are general perspective, motivation, job involvement, training & development and demographics. Survey was carried outon public and private banks of Pakistan (Punjab region). With the support of SPSS, Co-relation and regression analysis was conducted to generate results. We found that training and development has a positive association with both motivation and job involvement of the employees of banks in Pakistan. Moreover, job instructional training and informal learning are widely used techniques to impart the knowledge towards the employees in banking sector.

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These findings suggest that by boosting the training and development activities within the banking sector the employees could be motivated and get attached with their work. Keywords: Motivation, Training, Job Involvement, Banks 1. 0 Introduction With the extensive competition, greater demand for providing better product and services, continuously changing in technology and business environment in commercial banking sector demanding more than ever in the past the emphasis on trained employees in order to meet the equirements of the customer and the business survival, banking industry now calling for up to date/latest and broader banking knowledge, skills, abilities for maintaining their existence and growth, which demand for the proper and effective training to the employees. There are so many situations where service can fall between the cracks. Is the representative at the information desk trained to find a replacement while she is away for a few minutes? No? There goes another customer who doesn't want to wait. (I know. I've been there).

Is the guard at the door trained to direct customers to the right people or does he curtly wave them over to wait at the end of the line at the Information Desk when he could have sent them to the platform person who opens accounts? Do you really think that the employees are well versed with the etiquettes, cultural norms, customer psychology? If you answered no to any of these questions about training, then money is walking out the door and you are certainly losing customers which are fuel of your business. Without the fuel you cannot run the train of your business.

Due to the cutthroat competition, increased inclination of consumers towards quality oriented products and services, more customer orientation, rapid technological advancements resulting in methodical alterations and an ever changing business environment signifies, more than ever, the need of training the employees in the banking industry of Pakistan.

This research paper serves the purpose of acknowledging the need and importance of training to the bank employees in Pakistan. And whether the training really impacts the employees' performance and contributes to the productivity.

Literature Review

So many studies are available on the subject, which seek to determine the impact of training on the motivation and commitment. Some are provided hereafter: Cooper et al. (1989) found a positive relationship between training programs and employees job involvement.

He argued that if there are some recognitions and financial benefits for the high performers at the training programs, the feelings of reciprocity emerges in the high performing employees as well as in other ones which motivate them to extend themselves in many ways such as adapting new skills, knowledge and competencies which ultimately leads to improved organizational performance. Miller et al. (1996)examined the need and impact of training and development on the service sector employees is widely discussed topic in the literature.

The literature review targets the trade journals, text books and various magazines that contain the information on training and development. Training needs assessment is the first step of an organization s training and development program. It identify the needs or performance requirements of the organization_ it determines whether there is gap between the actual performance and the standard performance set by the organization and if there is any discrepancy between the two, then training is required. After the needs assessment, the training objectives are determined . i. e. who needs training and what training is needed.

Then the training is designed and implemented accordingly. In the end it is determined whether the training objectives were met. The evaluation system includes identifying participant reactions to the training process, how much participants learned, and how well the participants transfer the training back on their respective jobs_ if employees subsequent performance would be better than the previous, then it can be said that the training has a positive impact(most of the time) on employees performance otherwise not Hughey and Mussnug (1997) found a positive correlation between the employee training and employee & job satisfaction.

Today, every organization provide some type of training to their employees after some intervals. Some companies provide formal trainings such as initial and ongoing training programs, some hire outside training consultants according to their requirements. So motivation for implementing training programs varies from company to company. A very few organizations provide effective trainings to their employees in order to improve their knowledge, abilities and skills, and the correlation of such training programs with job satisfaction is high.

On the other hand, some companies provide trainings to meet health and safety regulations and some firms provide training only for appearance sake and the correlation of such type of trainings with motivation is not so high. Dowswell (1998) concluded that lack of time, growing age and other practical constraints demotivated the employees during the training. He found a negative correlation between training and motivation for aging employees and managers. He argued that the aging workers always want to maintain the status quo and if they are bound to adapt new skills and competencies through training, then their motivation levels decrease.

Lester (1999) said: Professionals must relearn and retrain to maintain the relevance of their skills . In this statement, he argued that changing nature of the corporate environment encourages the managers and employees to continuously relearn and retain new skills, knowledge and competencies in order to keep them up to date.

He found a positive correlation between the training and the highest prior level of education gained which increase the employee motivation. He concluded that if employees perform well on the training and subsequent to the training, if they perceive that they have learnt something new which would be an enhancement in their CVs as well as beneficial for them to capture the future opportunities, then their motivation and involvement towards their jobs increase. Stephenson (1999) concluded that there are two basic factors which are very crucial to be present in the employees in this new changing economy i. . ability to learn and adapt and understanding of the new corporate environment which can be utilized by the corporations through continuous training programs in order to increase their motivation as well as involvement towards their jobs. He argued that continuous training and professional development is not a luxury but a necessity of today s changing economy, as employees can better understand that in order to cope with the changing corporate environment and to exploit the future job opportunities training programs are very useful to make them up to date.

So most of the time there is a positive correlation between training and professional development programs and the motivation of employees. Gregory (2001) concluded that training has a great impact on employee s subsequent job performance and the lack of training and development results in managers not familiar with the task requirements as well as the core competencies such as knowledge, skills and abilities which managers must possess to perform well the organization s tasks, as a result their performance as well as motivation level decrease.

He suggested that the managers in service organizations must be knowledgeable in all newer functions that apply to their departments so that overall organizational objectives can be achieved effectively and efficiently in accordance with the new demands posses by the corporate environment.. A descriptive study conducted by a group of researchers. Roscoe (2002) said: No professional completes their initial training equipped to practice competently for the rest of their life .

He argued that corporate environment is changing day by day and in order to cope with the level of changes, organizations implement various dynamic processes including the training programs which subsequently increase the motivation levels of employees as after the training process most of the employees seek promotions to higher level jobs which is the main cause of motivation. Garavan et al. (2003) found that training process is a more job oriented that can change employee attitudes and behaviors that motivate them to increase their knowledge and understanding of the job according to the dynamic corporate environment.

Another researcher (Manu, 2004) suggested the desirable techniques and models which may prevent the failure of a training program. In this study, it is concluded that the organizations should choose those models of training and development that successfully fit into the organization s culture. Needs of training and essential business skills should be carefully assessed. Then appropriate managerial techniques as well as the comprehensive plans or models should be implemented for the effective training and development program in order to motivate the employees, reduce the performance gaps and achieve the organizational goals effectively.

Mathieson (2006) found a positive relationship between the training programs in which managers are participatively involved in setting the training design & motivation of employees. He argued that everyone should be involved in the journey of training program as in this way employees feel ownership of the process which add value to their performance which in return motivate them to deliver the tangible organizational improvements. Morag Mathieson is the training and development manager at the Glenmorangie Company, Broxburn, West Lothian,Uk _ He said that the company s key objective is to design the training programs which fully utilize the employee s potential and motivate the employees to continuously adapt the new skills and competencies according to the changing corporate environment. He suggested that management buy-in to training and development through bottom-up-approach can be used for this purpose.

Khattaket al. 2010) suggests that training and development is directly related with successful performance of managers, organizations and nations. The countries which spend more on training and development of human resources are relatively more developed as human resources contribute to productivity more than physical and other resources but there is a problem, population growth is inversely related with human capital investment, particularly in developing countries like Pakistan, so it should be controlled in order to spend more on training and development of human resources that make the more employees to get involved in their jobs and ncrease their subsequent performance A Questionnaire survey conducted on 1000 top companies of Malaysia where (Jamil & Som, 2007) concluded that changing nature of today s corporate environment and the intense global competition where consumers demand more quality services require the organizations to continuously train their human resources in order to maintain market competitiveness and business survival.

The researchers argued that ad-hoc training approaches and the training programs without proper analysis leads to poor training investments, so three levels of analysis(individual, organizational and operational) as well as the multiple data collection methods and techniques should be used to analyze the training needs in order to effectively design and implement the training programs for motivating the employees and achieving the organizational goals more efficiently. Murphy et al. 2006) concluded that there is positive correlation between training programs and employee s motivation. He argued that are certain set of factors which motivate the managers and employees to continuously adapt new skills and competencies according to the today s changing environment and also increase their subsequent motivation level. These motivators may include improving the confidence level and self esteem, higher levels of career satisfaction as well as more future promotion opportunities for those who show improved subsequent performance.

He also identified some barriers in the way of training to motivation which may include lack of employer s financial support & recognition as well as insufficient knowledge about the training program. He suggested that the organizations should remove such barriers and promotes the motivators in order to effectively implement the training, obtain the required outcomes and subsequently increases employee s motivation and involvement towards their jobs.

According to (Longenecker, 2010), there is a positive relationship between training programs and employee motivation which make the employees more involved in their jobs and subsequently results in better performance and productivity both for the employees as well as for the organizations. He argued that the organizations which want to attain long-term suitable results, spent huge amounts on training programs in order to make the employees up to date according to the dynamic corporate environment.

He also added that employees can t improve their performance if they don t know about the need for change, so it is the responsibility of the supervisors to make the employees aware about the need for training in order to motivate them and obtain the desired outcomes. Adomi (2006) found that there is a positive relationship between training i. e. job rotation and employee motivation. He adopted survey method for the study in which he used questionnaire as data collection instrument. He argued that training programs such as job rotation reduce the  boredom of the jobs and increase the motivation through diversification of the tasks. Employees get motivation and learn new skills through training which make them to have a broader view of the jobs in the organizations in which they work and in this way performance and productivity of both employees as well as the organizations tend to improve.

Kushnir, Ehrenfeld and Shalish (2006) argued that there is a positive relationship between training programs i. e. oaching and motivation of employees. He used self report measures as research instrument and compared the experimental study ( graduates who got training ) with the control group ( graduates who didn t get training ) and found that training increased employee motivation, self-efficacy and professional performance among coaches but not in control groups. He also added that training enhances the professional development skills of coaches which make them to perform the complex job tasks easily and to get the desired outcomes for the organizations in which they work.

Amorose and Butcher (2006) found that there is a positive relationship between training programs i. e. coaching and self determined motivation. He used cross-sectional survey method for the study during the training sessions. He argued that importance of the training programs is obvious as a lot of training factors such as perceived training needs, autonomy as well as sense of relatedness with the training programs affect the motivational outcomes.

He also added that performance related feed-back, as well as different type of rewards, are provided to the employees on the basis of training evaluation which make the employees motivated and enhance their performance which subsequently results in increased productivity and performance of the organizations. 3. 0 Research Methodology 3. 1 Method: We conducted survey questionnaire for the collection of data in our study. The questionnaire consists of total five sections. First section shows the general prospective of training and development on employees.

Second section tells about the impact of training and development on motivation of employees. Third section shows the relationship between job involvement and training and development. Fourth section depicts the type of training and development mostly used by banks. Finally, Last section tells the demographics of the respondents. 3. 2 Sample: We take the sample of 100 questionnaires for our study. The respondents of questionnaire are from different bank employees in Punjab region. We selected all types of banks including public banks and private banks.

In private banks, we divided the banks also in Islamic banks and conventional banks. The respondents are of all age level with their respective experience level. The questionnaire used in this study is reported in Appendix-I 3. 3 Hypothesis: The study seeks to reveal the causal relationships between the following: H1: There is positive relationship between Motivation and Training and Development. H2: There is positive relationship between Job Involvement and Training and Development. Type of bank consists of Public Banks and Private Banks. Nature of bank consists of Conventional banks and Islamic banks. Public banks refer to those banks which are owned by the Government.

Conventional Banks are bank which use typical methods of banking. Islamic Banks are those banks whose operations are according to Islamic rules and regulation. In our survey, in Public banks, 21 respondents are from Conventional banks and not a single respondent from Islamic banks. In private Sector, 73 respondents are from Conventional Banks and 6 respondents are from Islamic Banks. So in total, 21 respondents from Public banks and 79 respondents from Private Banks and total 94 respondents from Conventional Banks and 6 respondents from Islamic banks.

From the Qualification point of view, 21 male and 6 female respondent have Graduation s qualification and 61 male and 10 female respondent have Master s qualification and 1 male and 1 female respondents have other qualification Out of 100 respondents, 98 respondents respond to Experience answer with 0 and 36 years of minimum and maximum experience respectively. The mean value of experience employees is 8. 63 and standard deviation is 8. 445. Experience with current job respond by 87 respondents whose minimum experience to current job is 0 years and maximum experience to current job is 36 years. The mean and standard deviation of experience with current job is 5. 7 and 5. 963 respectively. Total 95 respondents give their age answer in with minimum age employee is 18 years with no experience and maximum age is 58 with 36 years of experience. The mean age of respondent is 32. 9053 and standard deviation is 8. 86311.

Training and Development in Banking Sector – Research Articles essay

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