Human Resource Management In Consumer Banking Bsiness Essay


The study is conducted to encompass the recent change in Human resource management processes and techniques in consumer banking. The current wave of capitalism and globalization has caused enormous changes in the banking reforms which has lead to increase in performance and Human resource management culture in banks. The research focused entirely on the factors that influenced the HRM practises in banks across Pakistan. The information regarding the related topic was gathered through articles, magazines, journals and research papers. The effect of dependant variable on the independent variable was analyzed through statistical test such as multiple regression and correlation. The data for the statistical analysis was collected through a primary research of questionnaires that were filled by the HR employees in different banks. The regression analysis showed that the dependant variable HRM had a positive relation with five out of the seven independent variables. Thus this indicates that the research conducted is giving a positive correlation with the factors that are affecting the Human resource management practises in consumer banking.

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I would like to express my gratitude to my supervisor, Miss Sahr Nawaz, whose expertise, understanding and patience added considerably to my graduate experience. I appreciate her vast knowledge and skill in many areas of research and her assistance in solving my queries and problems of conducting this research.

In conclusion, I recognize that this research would not have been possible without the assistance of the HR managers of major banks in Lahore. I would also pay my regards to Lahore School of Economics for providing me a platform to conduct this research that will always help me in my future endeavors.


An overview of the topic

HR operations today have became more involved in partnering with top managers in both designing and implementing their strategies that will help increase performance in Banks. Top management wants to see how the HR plans will make the company more valuable through improved performance. Effective human resources are considered a key to the sustainability of all businesses successes hence this topic discusses about the factors that are influencing the current HR techniques in the banking culture. Moreover increased globalization and competition in financial institutions i.e. banks have caused a need to establish strong employee-employer relationship with capabilities of successful training in these institutions. This research highlights the factors that help in devising an effective HR policy that will help increase employee performance by evaluating the variables that affect it the most. In my research the HRM performance is taken as the dependant variable and the factors affecting it are the independent variables.

Managerial Concerns

The results of my research will help the HR managers to evaluate the techniques that are being practiced in the banks today and more emphasis will be given on the employee satisfaction in these institutions that will in turn help in increasing performance and devotion. Also this research will help the managers understand which variables have the most impact on the performance of HRM and which has the least impact on it.

Research Objectives

Objectives of the study include the following:

To identify impact of HRM techniques in the performance of consumer banking?

To explore new HRM banking techniques to improve relation with the workforce.

To prove that globalization and increased competition has made HRM an important part of consumer banking.

Create a detailed analysis on what have been the major sources that have led to employees' turnover within the banking industry.

To analyze how HR administration outsourcing could contribute in optimizing strategic and higher-value activities in banking.

Related Definitions

Work Experience: Experience gained while employed in a particular occupation. Work experience is valuable in building a successful career and fosters the ability to assume greater responsibilities. It helps in getting a job easily and diversifies the skills of the employee hence affecting the HRM practices in bank.

Academic Background: Academic background is the past information about the college, school, or other educational institution especially for higher education of the employee. It is essential to know about the academic background while recruiting employees.

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Compensation Benefits: A well designed compensation and benefits plan helps to attract, motivate and retain talent in a bank. It is the most affective HRM technique used in banks to motivate employee and create job satisfaction.

Performance appraisal: It is a process by which a manager or consultant examines and evaluates an employee work behavior by companing it with present standards. Performance appraisal techniques help in evaluating the work tasks in banking offers a valuable opportunity to focus on work activities and goals, to identify and correct existing problems, and to encourage better future performance.

Increased Competition: The economic revolution and increase in globalization has lead to an increase in banking competition. Internationals banking are expanding their services and network in developing countries where there is more potential

Gender Discrimination: Gender discrimination refers to any situation where a person is denied an opportunity or misjudged solely on the basis of their sex. In banks recently gender discrimination has been lead to employee dissatisfaction and lack of work ability.

Training and Recruitment: The processes used to train, hire and recruit employees for the bank also affect the HRM practices of consumer banking. Every bank has different policies to hire and train employees.

Technological Advancement: The impact of technology and information systems on bringing a revolution in the banking services.

Financial Performance: The analysis of all the financial ratios of the bank i.e. the current asset ratio, the liquidity ratio, the financial leverage ratio, debt to equity ratio etc. These ratios determine the profitability of a bank hence letting it manage the HRM costs.

Literature Reviews

Ann P.Bartel (2004) states in this article that Human resource management practices can be more important determinant in service sector than in manufacturing sector. To prove it he has conducted a research on the branch managers of the banks and how they visit sites in order to identify employee performance that in turn affect the branch performance. The author has examined the branch operations of the Canadian bank and how HRM affect the performance of employees in service sector.

The author has collected the data from bank's headquarters and its branches. By visiting the branch the author has visualized the Human resource environment at each work site. The author has named organizational Human resource management as "black box". Employees who perceive their organization as one that facilitates performance, enhances career opportunities and provide positive supervision will end up having loyal customers. The study's main findings highlights that customer's attitudes towards the service quality is directly related to the employee's response to their queries and problems. The customer's feedback is very essential to assess the employee training practices so the questionnaires were given to customers as well to take their response on the employee interaction and banking activities. In service industry such as banking HRM training is an essential tool to get customer loyalty otherwise the customer has a second choice. The profitability of a sale done in a bank depends on the characteristics of the customer i.e. wealth, age and the ability of the employee to make a sale.

The author has also analyzed the branch output equation which in terms explains the profitability of the banks sales. The author has taken into account two branches and used this equation to compare their profits and costs that are associated to the banks' operations. In today's globalised world it is fairly essential to develop a employee culture that is customer oriented so that services can generate profits in order to run the banking operations. Dishonest, rigid and rude employees can never be helpful in developing organizational success.

Adrian Wilkinson (1995) seeks in this case study to critically examine the development of HR strategy in a bank. The experience suggests that whilst HR type policies are being implemented, the outcomes can by no means be taken for granted. This paper sets out to explore the development of Human Resource Management (HRM) in the Cooperative Bank. It briefly discusses the literature on management strategy and employee relations and the rise of Human Resource Management. An overview of employee relations in banking is observed in order to have a analysis of HRM in co-operative banks.

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The researcher adopted a top-down, Qualitative approach to the research, which allowed for the "capture" of strategic change, as this way was deemed the most appropriate method for examining the relationship between business strategy and the management of labor. The approach towards the HRM and the new strategies that are being implemented towards a efficient HRM system are Industrial relation, Cost control, changing culture and changing role of personnel and line managers. The sponsorship of the research by the organization enabled a high access to be achieved. 'While a case study is not capable of statistical generalization, the prospective generalization of a case study lies in analytical generalization. The response of the Bank employee and management relations to changes in the financial sector which has been experiencing money depreciation, increasing competition, technological innovation and an increasingly discriminating public. As greater diversity begins to exist amongst the retail bank the study explores the Bank's attempt to find itself a niche or adopt a focus strategy. The case of the Co-operative Bank sheds light on the issues of human resource management discussed in the management literature. It was suggested that a shift from an administrative to a market driven organization would lead to a greater priority for the management of human resources. Thus one consequence of the Bank's HRM policies was probably worsened employee relations, even if bottom-line performance improved. However, one needs to bear in mind that the ultimate aim of HRM is better business performance rather than improved relations with the workforce. This may be something Personnel and HR managers, whether in the UK or the Pacific need to come to terms with. Of course it is too early to evaluate the success of introducing HRM.

Antonia Sinden (1996) highlights the nature, and discusses possible causes, of three aspects of recent employment change in retail banking - job loss, rising flexibility and geographical restructuring in this research paper. Due to lack of HRM practices or training there is a huge impact on the British banking system. Large scale job losses are argued to have resulted from the interaction of deregulation, technological advancement and increased competition with rising corporate pressure to maximize profits. It is shown that while work organization in retail banks is becoming more flexible, individual jobs are more rigidly defined and constrained than previously. All this Job losses are shown to have been heavily concentrated in South East England. Evidence presented here supports and reinforces recent claims that there has been a diminishing of the British 'north-south divide' in economic development which was observed by many geographers over the 1980s.

Growing competition has also encouraged financial instability among the banks as the deposits are scattered and people find convenience rather then loyalty. A further response to growing competition within a relatively stagnant market has been a wave of take-over and merger activity between banks and building societies. The preceding description and analysis of employment decline, flexible labor organization and geo-graphical employment restructuring in retail banking demonstrates the fundamental and far-reaching nature of recent employment developments in this sector. This paper has argued that British retail banks have responded to the pressures of a more competitive environment with efforts to increase efficiency and reduce costs through significantly reduced staffing levels (often enabled by technology) and through the functional, temporal and spatial redeployment of many remaining staff. Fashionable concepts such as downsizing and flexibility are part of the new corporate culture in British retail banking, where the primary aim is to provide higher levels of service at lower costs. The advent of a national recession during the period of major restructuring by the retail banks contributed to the need for more stream-lined operating procedures, but may also have made the process of 'downsizing' less painful and less dramatic than it might otherwise have been. This paper therefore extensively describes the reasons of decline in the British banking system.

Mankidy (1996) discusses that the reforms that have paved its way towards a changing employment relation in banking. The various changes that have taken place in the employment of banking industry due to globalization and liberalization are the dependant variables of this article. The dependant variables of this article are the attitudes of individual employees, the unions, the management, technology and changes in the bargaining system.

Industrial relations help in increasing experiences for the employees and nowadays going through a massive transformation. In this research paper the author discusses the impact of increase of banking network in India. There has been a huge impact of globalization for the Indian banks that has thrown them into national and international competition. New strategy has to be devised that the available HRM will respond positively to the clients and employees themselves. In the early sixties and seventies the trade unions helped to formulate rules and regulations whereas now there is a huge emphasis on individual employee relations. There are visible changes in employee composition as well. Before the women were never used to be hired for banking services but now women employee entering Indian banks is on increase. There is a change in the trade unions and officers association as well where pacts are being signed to cooperate and circulated among employees for efficient performance. The author also explains management's role in developing complementary HR/IR process in banks. He explains that the shift from "system-driven" to "people oriented" management approach has played a vital role in broadening top level manager's role. The emerging decentralized bargaining trend is certainly leading to several negotiations at bank level. This helps to have interactions for the more competitive rules and procedures in banking network. This would also alter the HR processes giving a positive impact to banking arrangements.

Nowadays the workforce of employees is more educated and experiences therefore the much is expected from the trade unions and management of employees to bring about changes in the organizational setup that in return give profits. Hence HRM is a integral part of a bank's operations and both trade unions and management improvement techniques can pave the way in conducive employment relations in banking.

Another web article is "Human resource management and the banking sector" written by Imran Samad discusses how Human resource management (HRM) has long been overlooked in the corporate sector in the country where a small section, comprising mostly the multi-national companies was practicing the same. 

He highlights that almost every bank and financial institution is involved in various functions in a day's job and thus requires a highly effective team and appropriate manpower to run the show. Corporate goals are translated into viable realities and profits only with human element that play their due role in achieving the desired results. Thus even the high automation would require proper man behind the machine to make things happen. This idea has been realized by top managements in progressive banks.

The author tells that like many other organized sectors, banking requires multi layer manpower for its various requirements of professionals and support staff. The range may require reasonably educated security guards on the one end and a highly educated and trained professional as head of corporate finance at the other. With liberalization of activities within the banking sector, for example, more emphasis on consumer and house finance and personal loans, etc. banking has turned itself into a more market-based business where banks have expanded their reach more to customers' door steps in a big way making banking more practical. This has further highlighted the need for proper deployment of man-power to run banks efficiently. The different variables discussed in this article are Effective work force, Right people, Compensation and morale boosting are major determinants of effective impact of HRM assessment in consumer banking. In short, Banking jobs being apparently lucrative for many attract a large number of candidates against advertised vacancies in media creating a large data base management problem. This has been facilitated by specialized hiring agencies who may take up the job of hiring in case of large number of vacancies. 

Muhammad Tahir basher and Jesus Carlos (2010) highlight the role that training plays in the success or failure of sales in consumer banking practices. The author has taken two branches of two different cultures and used questionnaires as primary source to distinguish between the practices used to train employees in banking system. The author has done a case study on Citibank focusing on branches in Spain and Pakistan.

The study shows that training plays an important role in sales and satisfaction of clients. It also helps to develop personnel skills of employees and hence contribute in generating profits. The scope of the problem in this research is that every corporation is profit oriented and three major variables are revenues, cost and taxes. All these variables have a direct impact on sales training because most of the costs spend on other expenses leaves very little budget for the sales training. The problem which this industry faces is that in some banks, the sales teams have a lot of formalities or paper work that leaves training in a second place. Training is not the one element needed to have success in the work place. Experience and genetic plays an important role in the satisfaction of the customer. Experience is related with the logical consequence of increasing the repetition of a task and the quality of the performance will increase as well. The author has used the data from two different cultures to evaluate the major differences in training practices of sales force in consumer banking. This entails that in more developed countries training of employees is essential because the customer's needs and demands are more whereas in less developed countries more emphasis is laid on marketing as in to target large number of consumer or clients.

The author explains that by training the staff one can achieve Total quality management hence fewer complaints, enhance employee skills, Increase motivation in the workers, Increase self-confidence, Increase work force flexibility and higher job satisfaction. It also discusses the methods of training like the cognitive and behavioral methods. The research concludes that increment of productivity and the costumer's satisfaction are the main effects of training in the banking sector.

Yin Teng Chew and Siew Ming Choo explains the dilemma faced by many businesses today is managing strategic change initiatives efficiently and effectively. Arguably, managing changes simultaneously poses great challenges to organizational success in terms of the desired change. The purpose of this paper is to discuss the driving and resisting forces that occurred during a transitional programme in a Malaysian bank. Issues in the implementation process include change initiatives and the challenges that were faced. Qualitative data indicated that while the implementation process and efforts were genuine, they were fraught with various technical and HR problems, and it was found that change efforts lacked integration and attention to human issues. Change efforts mainly focused on business and cost driven initiatives. This observation suggests that organizational leaders should give careful attention to how each activity can be designed and well integrated when planning and implementing organizational change. The paper discusses the implications of these finding on HR policies and practices in financial institutions.

The dilemma faced by many businesses today is managing strategic change initiatives efficiently and effectively. Arguably, managing changes simultaneously poses great challenges to organizational success in terms of the desired change. The purpose of this paper is to discuss the driving and resisting forces that occurred during a transitional programme in a Malaysian bank. Issues in the implementation process include change initiatives and the challenges that were faced. Qualitative data indicated that while the implementation process and efforts were genuine, they were fraught with various technical and HR problems, and it was found that change efforts lacked integration and attention to human issues. Change efforts mainly focused on business and cost driven initiatives. This observation suggests that organizational leaders should give careful attention to how each activity can be designed and well integrated when planning and implementing organizational change. The paper discusses the implications of these finding on HR policies and practices in financial institutions.

Larry W.Hunter (2004) applies the strategic perspective to interviews and surveys of retail bankers, and considers the possibility those commitment-based practices characteristic of the "High-Performance Workplace" might be adopted in the industry. The data suggest that practices associated with High-Performance Workplaces have not generally found their way into retail banking. However, if they can be shown to create capabilities that banks value. Retail banks may be strong and independent lines of business, but this is not always the case. In some organizations the role of the retail bank is chiefly to generate low cost funds for larger holding companies and in many holding companies the retail bank has had lower status than other somewhat more central and influential areas. For example, a merger might be driven by the desire to achieve presence in new wholesale markets, with the entire retail bank brought along in the merger almost as an afterthought. This may weaken or alter expected links between corporate strategy and the management of human resources in the retail bank.

In addition to its contribution to broader corporate aims, a retail bank may also have a

Competitive strategy of its own. An increasingly dynamic, competitive environment characterizes consumer financial services. Changes in regulation have given rise to an extensive increase in interstate banking. New technologies for delivering financial services continue to be developed rapidly. Banks face a variety of non-bank competitors; increasingly these other institutions are attracting investment funds (e.g. the dramatic increase in mutual fund holdings) and other products (e.g. alternatives for automobile and home equity financing). This new environment is forcing retail banks to move to more entrepreneurial, sales-oriented practices if they are to continue to thrive. In retail banking, uncertainty lays both in understanding the potential value of particular business strategies, and in seeing what sorts of outcomes different HRM systems will produce.

Tahir Masood Qureshi (2010) states that this study is conducted based on universalistic

Perspective, indicating that fixed set of best practices can create surplus value in various business frameworks. In this study, the most relevant HRM domains (e.g. selection, training, job) The performance appraisal techniques used in banks in the major practice conducted by banking managers to keep the employees motivated towards their work. This paper highlights the basic concept of these value based techniques to identify the satisfaction of employees and hence assign them with benefits on their performance. This is the perfect way to make HRM department work in a bank.

Description, performance appraisal system, compensation system career planning system and

Employee participation) are all selected for this research. In the field of human resource management and behavioral sciences, all these practices are used to create a relation between

Operational performance and financial stability.

Human resource management (HRM) practices are being increasingly considered as major contributory factors in financial performance of organizations as well. This research study effectively highlights the importance of HRM practices with impact on financial performance of banks (FPB) operating in Pakistan. The major objective of the study is to find out the relationship between 'HRM Practices' and the 'Financial Performance of Banks'. As a sample, 46 scheduled banks were contacted, of which 38 responded. The HRM practices selected for the research study were selection, training, performance appraisal system, and compensation system and employee participation. Empirical evidence was calculated through stepwise regression analysis, Pearson correlation and descriptive statistics to support theoretical models that link HRM practices with financial performance of banks. The study concluded that all tested variables have a positive relation and impact on financial performance of banks but the major contributory practices are selection, training, compensation and employee participation.

James A. fellow (1978) states that how the commercial banking output influences the different variables in successful banking practices such as Finance, Marketing and HRM policies. This author has identified different banking output marginal models to explain his theorem and to apply his theories on the banking practices being held today. The author has also identified the earlier models of the banking system and later goes on to explain the modern theorem of commercial and consumer banking. The theorem is designed by the dependent variables of MC and MR that are used to make a graphical diagram of the marginal cost commercial banking theory.

This paper has attempted to show that a true theory of the banking firm is incomplete unless it takes into account two important factors. First, costs of acquiring different assets are indeed not the same and should be explicitly considered in any model of the banking firm. Secondly, any equilibrium must be a general equilibrium, i.e., a simultaneous equilibrium must be reached in both the asset and liability markets. To develop equilibrium in only one market is neglecting the fact that banks, like all other firms, transform inputs (deposits being the input in the bank's production function) into outputs (loans). And as with any firm, equilibrium in the output market is obtained only if there is equilibrium in the input markets.

Methodology & Analytical choice

Research type

Research Hypothesis

H0: there is no relation of between HRM practices and Banking competition

H1: there is a relation between the HRM practices and banking competition

H0: there is no relation between HRM practices and compensation benefits

H1: there is a relation between HRM practices and compensation benefits

H0: there is no relation between HRM practices and factors influencing recruitment

H1: there is a relation between HRM practices and factors influencing recruitment

H0: there is no relation between HRM practices and gender discrimination

H1: there is a relation between HRM practices and gender discrimination

H0 : there is no relation between HRM practices and technological advancement

H1: there is a relation between HRM and technological advancement

H0: there is no relation between HRM practices and work experience

H1: there is a relation between HRM practices and work experience

H0: there is no relation between HRM practises and academic background

H1: there is a relation between HRM practises and academic background

Theoretical Frame Work & Variables under Consideration

Theoretical Justification

This research conducted explains the significant affect of different variables upon the HRM practises in consumer banking .The independent variables are extracted out of the literature reviews that are taken from authentic journals and articles. The research analysis will help to identify the relation between the dependant variables that is HRM practises with the independent variables affecting it. The research results will help the managers at bank analyze the decisions that need to be formulated in order to increase bank performance and employee motivation. The theoretical framework includes nine factors/variables that are indirectly affecting the HRM culture in the banks.

Information Gathering & sampling Procedure

Survey design:

In order to collect the information for the research analysis a survey design was created. A primary research was conducted through the help of designed questionnaires. The questionnaires included thirteen questions made up from the dependant and independent variables. The options given in the questionnaire were from Yes that was given 1 code, No was given code 2, Maybe was given code 3, don't know was given code 4. This made it easier to put the data in the SPSS and Stat graphics to analyze the data.

Population, Working Population & Planned Sample:

The populations of my research are HR managers that are professional and working across major banks in Lahore. People having a experience in HR related field will be the best working population for my research. Working Population is extracted out from the total population that includes respondents from some sections of total population Thus chosen sample out of the total population basically represents the working population. The sample size of my population included 20 respondents. Such a low number of respondents were selected because the questionnaires were being filled out from the professional HR managers that were currently employed in the banks hence the data gathered was authentic and relevant.

Sample Size Consideration

The sample size of 20 questionnaires was filled out with ease as the managers had ample time to give the desired information. Such a low number of respondents were selected because the questionnaires were being filled out from the professional HR managers that were currently employed in the banks hence the data gathered was authentic and relevant. Subsequently the sample size was kept small to discourage biasness.

Field Work & Respondents Profile

In order to collect the primary data, five main banks were visited in Lahore in order to attain the desired information from the HR managers. These employees were professionally employed there in these banks and had a age limit of 25 to 40 years. Most of these managers were well established managers with a experience of average more than 5 years. These HR managers were master's graduates from top Pakistani and foreign institutions. Most of them were holding MBA and ACCA degrees.

Data Analysis Tools & Techniques

Multiple Regression:

The dependant variable of my research has been the influence of HRM practices on consumer banking and as I have mentioned in my research methodology I will be using primary research as my research analysis tool. A questionnaire is being developed that was being circulated among the employees of several banks across Lahore. The data gained from questionnaires was used as a data for regression analysis. It has been observed that the relation of my dependant variables on my independent variables in positive. . While analyzing the data for other variables which includes competition, work experience, academic background, technological advancement, compensation benefits and gender discrimination I have observed that all these variables have a positive correlation in the analysis. However we observe that the technological advancement has a less impact of the HRM practices as compared to the other variables that are present in the research. The impact of work experience, academic background and competition has the most influence of the dependant variable that is the HRM practices itself.

Now if we look at the regression findings we can see the estimation results and can analyze it with the help of a regression equation. For the primary data estimation, equation is stated below:

HRM = -0.0560111 + 0.585664*Academic background + 0.449251*Competition

+ 0.158758*Compensation benefits + 0.265441*Factors influencing

Recruitment + 0.799388*Gender discrimination - 0.310333*Technological

Advancement + 1.22965*Work Experience

This linear equation for primary data elaborates clearly the estimation that along with the value of constant that is HRM which is positive and effect of independent variable including competition, academic background, compensation benefits, and work experience has a positive impact whereas technological advancement and gender discrimination have a negative impact in the regression equation.

Tests of significance of regression, Parameters:

While evaluating model its regression and parameters results are kept under consideration and the following data is the multiple regression for my research.

Primary regression data

R-squared = 78.4751 percent

R-squared (adjusted for d.f.) = 70.9189 percent

Standard Error of Est. = 0.551397

Mean absolute error = 0.346461

Durbin-Watson statistic = 1.73211

In this case R-squared and adjusted R-squared are again above the standard 75% and hence proves the significance and fitness of the model , standard error of estimation that implies with the linear equation of the model comes out to be 0.5513 that shows the linear equation is effective and thus independent variables does cause variation in the dependent variables. The Durbin-Watson statistic is a test statistic used to detect the presence of autocorrelation (a relationship between values separated from each other by a given time lag) in the residuals (prediction errors) from a regression analysis. Durbin Watson comes out to be 1.73 which shows that there is no autocorrelation between the dependant and independent variables.

Multiple Regression Analysis


Dependent variable: HRM


Standard T

Parameter Estimate Error Statistic P-Value


CONSTANT -0.0560111 0.855686 -0.0654575 0.9489

academic backgrou 0.585664 0.287722 2.03552 0.0645

competition 0.449251 0.159237 2.82128 0.0154

compensation bene 0.158758 0.123537 1.28511 0.0230

factors influenci 0.265441 0.171608 1.54679 0.1479

gender discrimina 0.799388 0.242207 3.30043 0.0063

technological adv -0.310333 0.219131 -1.4162 0.1821

Work Experience 1.22965 0.25492 4.82367 0.0004


Analysis of Variance


Source Sum of Squares Df Mean Square F-Ratio P-Value


Model 13.3015 7 1.90022 6.25 0.0030

Residual 3.64847 12 0.304039


Total (Corr.) 16.95 19

Regression Summary:

I have used multiple regression analysis to analyze the affect of variables for both types of the research as I have illustrated earlier under data and methodology. The results of regression parameters and Test of significance has been discussed in previous section, which is quite positive and prove the authenticity of the model. looking towards the authenticity of the model , R-squared for the model used for secondary data comes out to be 80.80 which means that these two variables risk and inflation cause 80.80 percent variation in return and the adjusted R-squared for the multiple regression results for secondary data is 80.65 which reflects the fact discussed earlier. Now for primary data R-squared for the model comes out to be 89.487 which is very good and explain the fact that these independent variables are 89.487 percent responsible for causing variation in the dependent variable and thus proves this model authentic . Also the adjusted R-squared stays at 83.3544 which shows that after adjustment of the error the model is still authentic because the authenticity of the model still lies above the 80% thus showing that 80% of the variation is caused by these independent variables in the dependent variable return



Academic Background




Compensation benefits


Factors influencing recruitment


Gender discrimination


Technological advancement


Work experience


The table above shows the P-values from highest to lowest thus illustrating t he impact of the independent variables from highest to lowest. The work experience comes out to be the most significant of causing highest impact on the dependant variable HRM. Gender discrimination, compensation benefits and competition also have a value less 0.1 showing a favorably significant impact on the dependant variable of the research. The two variables academic background and technological advancement has less significant impact on the regression analysis giving a p-value greater than 0.1. This is because in country like Pakistan the technological development is slow and most of the HRM techniques practiced in the banks are obsolete and have less impact on the dependant variable that is HRM. The managers highlighted that the technology implications are only present in few international banks operating in Pakistan but that too is not used for HRM techniques such as software's designed to evaluate employee performance or appraisal. Most of the techniques are same orthodox and done manually.

The following table shows the hypothesis results that indicate that out of seven variables 5 are accepted and the other 2 are rejected. The rejected variables include technological advancement and factors affecting recruitment.


Accept h1 reject h0

Compensation benefits

Accept h1 reject h0

Factors influencing recruitment

Accept h0 reject h1

Gender discrimination

Accept h1 reject h0

Technological Advancement

Accept h0 reject h1

Work Experience

Accept h1 reject h0

Academic background

Accept h1 and reject h0

H0: there is no relation of between HRM practices and Banking competition

H1: there is a relation between the HRM practices and banking competition

The p-value of banking competition is 0.0154 that shows that there is a positive relation of this variable with the dependant variable so H1 should be accepted. The recent banking competition in the international market has made it difficult for graduates to get job so the stiff competition between the applicants's themselves has definitely impacted the HRM practices and how people are being employed in these banks.

H0: there is no relation between HRM practices and compensation benefits

H1: there is a relation between HRM practices and compensation benefits

The p-value for compensation benefits is 0.0230 that shows that this variable has a significant relation between the dependant variable. Thus we select H1 and reject H0 because if the employees in the organization will get compensation benefits in form of bonus salaries and rewards that will definitely encourage them. This technique is one of the best HRM practices that can be performed in a bank to motivate employees.

H0: there is no relation between HRM practices and factors influencing recruitment

H1: there is a relation between HRM practices and factors influencing recruitment

The p-value for this variable come out to be 0.1479 this shows that this variable has a slight impact on the HRM practices as there can be several factors that can be taken into account in this variable hence we accept H1 and reject H0 in this variable of factors influencing recruitment.

H0: there is no relation between HRM practices and gender discrimination

H1: there is a relation between HRM practices and gender discrimination

The p-value for this variable comes out to be 0.0063 showing a very impact on the dependant variable. This can be further signified with the facts that gender discrimination in current banking environments has definitely affected the HRM practices. Therefore we select H1 and reject H0.

H0: there is no relation between HRM practices and technological advancement

H1: there is a relation between HRM and technological advancement

The p-value for this variable comes out to be 0.1812 this shows a very slight impact of the dependant variable therefore we select H1 and reject H0.

H0: there is no relation between HRM practices and work experience

H1: there is a relation between HRM practices and work experience

The p-value for this variable is 0.0004 that shows that there is a very strong relationship between the dependant variable and work experience. The work experience these days is very essential to get a job in a bank hence it has paved its way as the most important factor that can influence the HRM practice in consumer banking so we accept H1 and reject H0. Expertise with a better work experience tends to increase the performance of the bank and are preferred more over the ones that have a less work experience.

H0: there is no relation between academic background and HRM practises

H1: there is a relation between academic background and HRM practises

The p-value for this variable is 0.0645 that shows it is less than 0.1 therefore there is a strong relationship between the dependant variable HRM and academic background therefore we reject H0 and accept H1. This is because a strong emphasis is given to the educational background of the employee while recruitment in a bank. The recent expansion of the MTO (Management training program) is a program designed to recruit employees from the top institutions around Pakistan which are then screened for further recruitment. It clearly highlights that academic background or the academic record is of crucial importance for the HRM practises in the banks.

Limitations of the Study

There were several problems that were faced during the research study. The tables of regression shows significant results but there are some limitations associated to these results. The following the limitations of the study:

Banks usually felt reluctant to share their HRM or recruitment information regarding employees. This was confidential information and most of the managers hesitated to get proper feedback during the verbal interview.

There was huge difference between the practises of the HRM practises done by local and international banks in Pakistan. Hence this variation created problems in identifying the correct data.

The age bracket selected for large enough therefore that caused problems in identifying the stable policy measures used by the banks.

The research was conducted in a short time span of four months; therefore there was a limitation of time constraints.

The sample size used was small as only 20 questionnaires were filled in the Lahore region. In order to build a better insight about the study more questionnaires should have been filled by the HR employees at the banks.


After the complete analysis of my research through multiple regression, I am able to analyze the five out of seven independent variable effect the research the most. The other two variables are rejected as they have no impact on the HRM practises being done in the major consumer banks of Pakistan. It is analyzed that work experience is responsible for causing highest variation in the dependant variable with the p-value which is lowest among all. The increased globalization and need for banking services have lead to a development of strong and more skilled bank work force. Nowadays we see and observe so many banks operating in our society this is because the wave of capitalism and importance of financial intermediaries have changed the way banks used to be in the past. Along with the development of banking sector, there has also been an evolution of modernized HRM culture being practiced in the banks. And the variables mentioned in the research play a vital role in practicing of these techniques. Moreover this research will guide the managers at banks to formulate and devise strategies taking in account the most important aspects that affect it. Hence these developments will help increase job opportunities for the banking sector.

Questionnaire (Impact Assessment of HRM practices in Consumer Banking)




Q.1 Gender



Q.2 Marital Status



Q.3 Annual Income

Below 50000



Above 200000

Q4. Is work experience an important element of recruitment criteria in a bank?




Don't know

Q5. If there is gender discrimination in a bank, does it affect HRM practices or employee -employer relationship?




Don't Know

Q6. Ineffective planning of workforce would be highlighted in banking by:

Recruitment and selection problems

The need to outsource some of the production

A need to offer retraining to current employees

An opportunity to increase the use of mechanization

Q7. Which of the following will influence the method of recruitment and selection used by a bank?

The state of economy

The size of the organization

The type of training programmes used by the bank

The expansion of international Banks

Q8. How far has compensation benefits or rewards helped employee increase bank's productivity?




Don't Know

Q9. Should bank managers hire employees with a strong academic background?




Don't know

Q10. Are you satisfied with the role expected by the management to be performed by you? If not why?




Don't know

Q.11 How far has technological advancement affected the reduction of human work force in a bank?




Don't know

Q.12 has increased international and domestic banking competition affected employment?




Don't know

Q.13 Has HRM been affected by the factors influencing it in a bank?




Don't know