HUMAN RESOURCE MANAGEMENT PRACTICES OF Al-Arafah Islami Bank Limited.

Supervised by: Presented by:

Mr. Mahbub Parvez Md. Mehadi Rahman Associate Professor ID: 133-14-1220

Faculty of Business and Economics Program: MBA

Daffodil International University. (Major in Human Resource Management)

Faculty of Business & Economics

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Introduction

Human Resource Management is responsible for the main dimension of people of the organization. It is responsible for hiring competent people, training them, helping them perform at high levels and mechanisms to ensure that these employees maintain their productive affiliation with the organization.

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Objectives of the Study:

To identify the training and development process of AIBL.

To analyze the performance management system of AIBL.

To know about the recruitment and selection process of AIBL.

To find out the employee benefit and facility provided by AIBL.

To make some recommendations to overcome the problems that is identified.

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Human Resource Management Practices of Al-Arafah Islami Bank Limited

Human Resources Department of AIBL Bank Limited is solely responsible mainly for recruitment, training and development, ensuring compensation and benefits of staffs, performance appraisals and rewards. With all those core functions Human Resources Department linkage its operations meet the organization’s objectives.

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Human Resources Division

The vision of Human Resource Division is to “Ensure improved business performance and competitive advantage by attracting, developing and retaining people in a winning culture that builds organizational capabilities to meet strategic objectives”. Human Resource Management plays a great role in every organization. So it is an integral part of AIBL. AIBL has specific HR division. They follow HR practices like Recruitment, Selection, and performance appraisal.

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Training& Development of AIBL:

The Bank gives utmost importance for making continuous investment in Research and Development (R&D) and Training to achieve operational efficiency in the competitive global banking scenario. The Bank’s human resource policy is to recruit and build up quality manpower having skill and professional expertise. In implementation of the human resource development strategy, the Bank established its own Training Institute at the Head Office with the vision to build up professionals with technical, human and conceptual skills.

The Al-Arafah Islami Bank Ltd. Training Institute arranged a total of 19 training courses, workshops, seminars, and induction programs with 514 participants. The objectives of designing all training programs are to bridge the gap between present level of competence and the required level of competence.

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Training& Development of AIBL:Serial No. Subject

1. Training Courses a. Foundation Trainingb. Islamic Banking Operationc. Credit Operation and Managementd. International Trade and Financee. Audit and Inspectionf. Customer Servicesg. Banking Law and Practicesh. Information Technologyi. Managing Core Risk

2.Workshops/Seminars/Induction

Program 

a. Credit Risk Grading b. Documentation/Legal aspects in loan sanction and disbursementc. Prevention of Money Launderingd. Standard Operating Proceduree. Basel II Capital Accordf. Credit Card Operationg. Retail Banking h. Relationship Banking i. Foreign remittance-rules and procedures j. Induction Program

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Performance Appraisal: Employees of Al-Arafah Islami Bank

Limited get a competitive salary with a wide range of fringe benefits. In order to sustain the employee’s performance on the job employers of the organization provide different facilities of modern life- house rent allowances, medical allowance, transport allowance and house utility bills. The Bank also gives various festive bonuses as well as other bonuses like performance bonus, security bonus etc. Employees also get the facilities of provident fund, gratuity and annuity. Appraisal in this Banks always provides according to the employee’s respective performances other than any prejudice.

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Recruitment and Selection Process of Al-Arafah Islami Bank Limited:

AIBL provides equal employment opportunity for all Bangladeshi citizens. It is the policy of the Company to attract, retain and motivate qualified and skilled employees within the company. To do this, the Company offers competitive compensation package and provides equal opportunity for career development to all employees. It is believed that in order to achieve the Company’s goal, there must be efficient and high caliber human resources. Therefore, the company pays maximum attention and efforts in recruiting highly qualified and competent employees who are willing to face challenges in achieving Company’s goal.

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Recruitment and Selection Flowchart:10

Guiding Principles of Recruitment & Selection Process

Fairness. Right person at the right job. Efficient and effective. Realistic Planning. Standard Method. Development Focus.

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Recruitment Source:

Recruitment Source

External Recruitment

Career Fair

Web Search Internal Recruitment

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Pay Policies of Al-Arafah Islami Bank Ltd.:

Provident Fund:

There is a fund called “AL-Arafah Islami Bank Limited Employee’s Provident Fund” which is governed by a separate Provident Fund Rules approved by the Board. All permanent employees compulsorily are the member of Provident Fund.

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Pay Policies of Al-Arafah Islami Bank Ltd.:

Gratuity:

Every confirmed and full time employee who has rendered seven years continuous service in the Bank or more, a gratuity equal to one month basic salary for each completed year of service may be granted to him on retirement/resignation/termination or to his family in the event of his death while in service. The dismissed employee is not entitled to any gratuity. Various attractive retirement benefits are in place.

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Performance Bonuses and Other Bonuses:

Allowances:

Employees get house rent allowance, conveyance allowance, medical allowance, dearness allowance, entertainment allowance etc.

Medical Facilities and Health Insurance:

Doctors of selected recognized hospitals time to time checkup employees. Officers of the Bank enjoy health insurance policy for himself. The Bank pays the premium. Again, before starting their job as a Probationer Officer they should be certified from the bank’s recognized medical center as he fit for successful performance. Staff welfare fund has been created for securing the employees from accidental loss.

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Findings:

In AIBL there were a good number of professional and qualified human resources. On an average, 75% of staffs were professionals, 18% were semi-professionals and the remaining 7% percent were non-professionals. Among the professionals most of them were MBA or BBA holders.

There was a great shortage of ICT-literate manpower in the bank. Only 4% staff had professional IT background with short term certificate course(s), while 70% had minimum knowledge on IT, and the rest of the staff 26% had no IT knowledge.

The study found that AIBL bank has its own training institute for human resource development activities but there is no proper HR information system. All human resources were centrally managed by their respective headquarters’.

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Findings:

AIBL followed usual procedural steps for selection and employment of qualified employees: completion of application form, employment test (cv scrutinize, written, viva-voce), comprehensive interview (simulation test, presentation, case analysis), and final employee selection.

Employees were more satisfied with salary scale, present job position and compensation. But employees are not satisfied with working hour, leave policy and HR policy. Employees strongly argued that they are not satisfied with the recent HR policies and practices exercised in the bank.

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Recommendations:

Educational qualifications, experiences, skills, competencies, and ICT-literacy of the potential candidates are given emphasis in the selection and recruitment process of employees.

To develop human resources, AIBL should undertake different HRD programs including continuing education and training, IT-orientation, career development, etc. Banks’ have good number of bright employees and it should create opportunities for employee’s higher studies with fellowship/scholarship at home and abroad.

AIBL should organize seminars, workshops, conferences, different short courses, and training programs on financial matters, current issues, software up gradation on regular basis that would definitely help to develop knowledgeable manpower, create awareness and change mental attitudes among the professionals.

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Recommendations:

AIBL and supporting bodies should allocate sufficient budget and sends competent employees to international conferences and seminars to prepare them for the competitive knowledge market of 21st century.

AIBL has a separate human resources departments. But it is essential to empower the department or divisions for handling different issues in HRM in bank. The divisions should be incorporated with well-organized HRIS (human resource information systems) and modern IT facilities.

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Conclusion:

The success of bank largely depends on the intellectual development of the employees. Generally, the banking profession in Bangladesh is recognized with standardized salary scale, higher social status and dignity. Human resources have been centrally managed in AIBL. The proper empowerment of HR department means their participation in preparing management policies, plan and program, forecasting demand and supply of human resources and in policy formulation and implementation. This will help to recruit and maintain skilled, knowledgeable and well performed workforce to meet current and future organizational as well as individual needs.

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Thanks to all

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