Impact of Stress on Banking Employees

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Impact of stress on banking employees on their job performance with a special reference to HSBC Electronic Data Processing (Lanka) Pvt. Limited (HDPL).

Table of contents

  1. Introduction ………………………………………………………………….. 03
  1. Problem statement………………………………………………… 04
  1. Problem justification……………………………………………….. 04
  1. Project objectives………………………………………………….. 04
  1. Literature review…………………………………………………………….. 05
  1. Methodology………………………………………………………………….. 08
  1. References …………………………………………………………………… 10
  1. Appendix ……………………………………………………………………... 13

1. Introduction

Stress is the destructive physical, mental and emotional reaction that transpires when a poor match between job demands and competencies are met between employees’ or resources to manage with job pressure. It is a condition ushered by suffering physical, mental, psychological or social problem that comes from individual feeling that doesn’t be able to respond due to unexpected situations. The basic root cause of stress in the organization, when employees face difficulties and changes in his daily working routine, but always avoid and this condition creates stress, anxiety, fears, worries, tension, etc. (Akinboye et al., 2002).

Kavitha(2009) states that “stress may have a positive or negative impact on performance and on the quantity of work done. When employees start feeling moderate levels of stress their efforts towards work and performance may increase. However, if stress becomes too high or persists for a long time, the efforts put in by them decreases, resulting in increased labor turnover and absenteeism”

HSBCis one of the world's largest banking and financial services organizations, with around 6,200 offices in both established and faster-growing markets. Global Service Delivery (GSD) is an integral part of HSBC Technology & Services and delivers world class services for HSBC’s customers across Retail Banking & Wealth Management, Commercial banking, Global Banking & Markets and Global Private Banking. Global Service Delivery in Sri Lanka is represented by HSBC Electronic Data Processing (Lanka) Pvt.Limited (HDPL). It was established and commenced operations in 2004. The Group Service Centre is located in Colombo. And consist with more than 2500 employees doing different shifts and working for different countries. (HSBC Global Service Delivery website 2012)

Working for 8 hours creates stress on employees where it can be positive or negative. And it is believed that it may arise from excessive workloads and day to day routines and continues stress might lead to employee dissatisfaction and finally can end up with turnover. Accordingly, this investigation covers how stress is being impacted on the employee’s performance and suggestions to manage stress and increase the productivity level.

1.1 Problem statement

What are the Impacts of stress on banking employees on their job performance and the productivity level with a special reference to HSBC (HDPL?)

1.2 Problem justification

According to Cooper (1984) he described stress as an “unacceptable occupational pressure or burden/trouble which badly affects the psychological & the physical condition of a worker itself”.This research topic is selected in order to research the impacts of stress on job performance & the productivity level of banking employees by giving a special reference to HSBC (HDPL). And the importance of the research is to gather results or outcomes of job stress on the daily performance of an employee and to discuss strategies to overcome it or to manage it effectively.

1.3 Project objectives

  1. To examine the nature of job stress.
  2. To investigate the impact of stress on the employee’s performance.
  3. To recognize the factors that are accountable for job stress
  4. To determine how stress can effectively be managed within the organization to enhance staff effectiveness and performance level.
  5. To commence primary research by means of interviews and questionnaires’ to gain quantitative and qualitative data relating to stress of banking employees on their performance.

2. Literature review.

According to Fink (2010), “A research literature review is a systematic, explicit and reproducible method for identifying, evaluating, and synthesizing the existing body of completed and recorded work produced by researchers, scholars, and practitioners”.

According to Larson (2004) stress is a “situation that arises from the interaction of people and their jobs which is characterized by variations within people that force them to deviate from their standard operations. According to Luthans (1995) stress is “an adaptive response to an external situation that result in, physical, psychological and / or behavioral deviations for organizational participants”.

A unique classical definition of stress, which was emphasized by Hans Selye (1983), is defined as the “broad-spectrum response of one’s body to any demand that is made upon it”. Thus, every demand made on each body is specified and unique. The factor produced under stress is termed as the “stressor”, either pleasant (eustress) or even unpleasant (distress), (Selye, 1983). The response of each human body to an agent or situation is the same, conferring to Selye. Varies is the degree of response. The sorting of stress (eustress or distress) which is depending on the nature of any situation, of an individual’s physical and psychological well-being, besides the characteristics of the family unit (McCubbin & Patterson, 1983b). Entities and families instinctively define stress, which is imitated by their morals and experiences in meeting emergencies and dealing with change of immediate variation. Subjectively an unpleasant or undesirable event by the each individual or family, the reaction of stress becomes distress (McCubbin & Patterson, 1983b).

The ambiguity in the term stress is its use to name both an external force applied to an object and the effect of that force on the body (Kahn, 1986). Stress researchers have added to the difficulty by disagreeing among themselves with respect to the meaning of the word. Some researchers believe that stress should be subjectively defined, while others believe it needs an objective definition.

Job stress is considered to be an internal state or reaction to anything we consciously or unconsciously perceive as a threat, either real or imagined (Clarke &Watson, 1991). Robbins (2001) defines stress as a “dynamic condition in which the individual is confronted with an opportunity, constraint, or demand related to what he or she desires and for which the outcome is perceived to be both uncertain and important”. Stress can be caused by environmental, organizational, and individual variables (Matteson & Ivancevich, 1999; Cook & Hunsaker, 2001). Organizational base factors which are known to induce job stress of employees at the workplace (Greenhaus & Beutell, 1985). Such factors are generally termed as organizational stressors since these serve as agents who trigger a variety of stress reactions (Von Onciul, 1996).

Many employees agree that one of the most common problems in the workplace today is stress. Stress causes loss of productivity, loss of efficiency, increased employee absenteeism, and many other problems. Stress comes from several aspects of an employee’s life: the workplace, social factors, and personal factors. Luthans (1995) states “stress has become a major buzzword and legitimate concern of the times”. A recent estimate is that stress is costing corporate America, staggering $68 billion annually in lost productivity due to absence from work and stress claims costing up to 10% of a company’s earnings. Unlike some of the other aspects in organization stress directly translates into dollars and cents to the organization and affects physical and psychological well-being of individual employees.

Manshor and Alam (2003) stated “more and more employers are concerned about stress in the workplace. Stress can lead to employee illness and even death. Employers are becoming concerned not only for humanitarian reasons, but also because of the costs to their companies. In several reasons court cases based on work-related stress charges companies involved lost their cases and paid settlements to employees. Thus the company suffered direct monetary loss as well as loss of the employees. Only if a manager does not care about employee productivity and well-being would ignore employee stress. However, if managers are genuinely interested in high performance they must care about stress in the workplace”.

According to James (1987), the most significant workplace stress factors are the amount of control over an individual’s own abilities. However, other factors such as the relationship between co-workers and supervisor; workplace environment, role conflict, work schedule may also lead to workplace stress. Prior researchers have found that, almost manufacturing job condition can lead to workplace, yet depending upon the workers' reaction to it. There are a few criteria of work conditions that almost cause stress for workers, which includes time deadlines, work overload, poor relationship between supervisor, repetitive work, machine paced task, lack of control, rotating shift work, cognitive demand, role ambiguity and physical environment (House 1981; Sutton and Rafaeli, 1987). Cox et al.(2000) reports “that 50% - 60% of determining percentages which were captured on all lost working days which related due to stress”.

The effect stress illnesses have now exceeded to back problems as Britain’s most common workplace ailment, estimate costing an industry £370 million on a yearly basis. A survey revealed in 630 UK safety council (Sparks & Cooper, 1997) showed “that 66% of named stress elements are the main health worry for workers. Stress is also a concern across all employment sectors and job-related levels have been a commonly reported cause of lost workdays and high staff turnover rate”.

However, The ability of each employee in coping with specific hours worked in measuring the productive rate expected, within the physical environment, as well as the anticipation of work desired by the management. In order for the research further defines that night shifts in particular have a high probability of resulting a negative impact towards the fitness/ health of each employee. In relation to this, 20 percent of the night shift workforce has experienced psycho-physiological claims, including heart illnesses. Such extreme factors contain to affect the competence levels of workforces.

Going forward, it is important to mitigate stress in working place in order to enhance job performance and the productivity level of employees. And further it will be discussed in detail in professional project which is to be conducted.

3. Methodology

According to Kumar (2008) “research is an intensive and purposeful search for knowledge and understanding of social and physical phenomena. Research is a scientific activity undertaken to establish something, a fact, a theory, a principle or an application. It is an academic activity.”Sekaran and bougies (2010, p.2) states “research is the process of finding solutions to a problem after a thorough study and analysis of the situational factors.”

Research Methodology is a way to see the result of a specific problem or issue on a specific problem and is also referred as research problem. In methodology, the researcher uses different criteria in order to solve / search a particular research problem. Various sources use different methods to solve this problem. And if we think of the word “methodology”, “It is the mode of searching the problem and solving it through a research”. (Industrial research institute, 2010).

When accompanying a research it is essential to decide which approach is being applied. According to Saunders, et al. (2009) “research approaches are mainly based on the research philosophies, whereby the deductive approach is commonly used by researchers with traditional natural scientific views (positivism), while the inductive approach is usually based on phenomenology (interpretivism)”. In this research interpretivism will be used as the research philosophy.

Furthermore, interpretivism studies generally focus on meaning and may employ numerous methods in order to reveal different traits of the issue. Therefore an inductive approach will be used which is frequently denoted as a “bottom-up” approach to knowing, where the interpretations are used to build a perception or to designate a picture of the phenomenon that is being deliberated. In other words, in inductive studies no recognized theories or patterns need to be verified during the research process. (Lodico et al, 2010, p.10)

According to Krishnaswamy et al (2009, p.168), “a research survey is an organized effort to analyze, interpret and report the present (current) status of managerial or social institutions, organizational groups, or management areas. It deals with a cross-section of the population at the current time”. Accordingly, for this research, a survey of primary data collection will be conducted using both the quantitative and qualitative methods.

Jackson (2011, p. 17) states, “Qualitative data analysis usually involves reading through the notes taken and trying to conceptualize from the data. And qualitative data are verbal in nature rather than numerical and consist of very detailed notes on what was observed via the particular methodology used”. He also states that unlike quantitative analyses in which data analyses cannot take place until after all data have been collected, with qualitative analyses the results of early review of the data might guide what data are collected later in the study. Therefore questionnaires will be analyzed and implied to observe the current status in HSBC (HDPL). A focus group of the population in HSBC (HDPL) will be targeted and their personal opinions regarding the research problem will be interpreted. The questionnaire survey altered for this research on job stress and performance level will expect to measure the prospect cause of job stress, which will upshot into counterproductive conclusions.

A convenient sampling method will be used in order to collect data and further analyze the observations. According to Jackson (2011, p. 122), a convenient sampling method is “a sampling technique in which subjects are obtained wherever they can be found and normally wherever is convenient for the researcher”.

Throughout, the research will be conducted in an ethical manner where the credit will be given for the information generated from other researchers and authors as per Harvard referencing style and where the respondents will be willingly participate in the survey. Further the questionnaires will be conducted in a manner where no harm is being exposed for research participants.

4. References

Arnold, J., Robertson, I. T., and Cooper, C. L. (1992). Understanding the human behavior in the work place. Work Psychology. London: Pitman publishing

Bass, S. M. (2003). Leadership and performance beyond expectations. New York: Free press

Beach, D. S. (1980). The management of people at work. New York: McGraw Hill Inc

Clarke & Watson, (1991).On becoming depressed or anxious in late life: similar vulnerability factors but different effects of stressful life events. Published 1 November 2001.

Cooper, C. L. (1984). Executive stress: Human Resource management

Dubrin, J. (1997). Executive stress and how to survive it. Journal of executive development

Joy, P. J. (2013). A Study on impact of work stress among Tile Factory Workers in Trichur District in Kerala. Issue 10.

Larson, L. L. (2004). International auditors & job stress. Managerial auditing journal, 19 (9). 1119-1130

Luthans, F. (1995). Organizational behaviors. (7th Ed)

Matteson and Ivancevich, 1999; Cook &Hunsaker, 2001. Organizational Stressors and job among managers; The moderating role of Neuroticism.

McCubbin and Patterson. (1983a, 1983b). Individual and Family Stress and Crises. By Janice G. Weber

Nnuro, E. K. (2012). Occupational stress and its effects on job performance: A case of Koforidua Polytechnic

Opatha, H.H.D.N.P. (1997). Strategic HRM as a part of strategic management

Sheena, J., Cary, C., Sue, C., Ian, D and Paul, T. (2005). The experience of work-related stress across occupations. Journal of Managerial Psychology Vol. 20 No. 2, pp. 178-187

The National Institute for Occupational Safety and Health (The NIOSH booklet). Publication No. 99-101

Shepard, E. And Clifton, T. (2000). Working hours, overtime, and productivity and manufacturing industry. International journal of manpower, 21(7)

Stone, R. J. (2002). Human Resource Management, (4th Ed). Australia: John Wiley & Sons

Vikrant Baghi. (2014). Causes and Effects of Work Stress in Organization. http://www.scribd.com/doc/46644902/Causes-and-Effects-of-Work-Stress-in-Organization-Vikrant-Baghi. (Accessed on 05th March 2015)

Kavitha (2009).Occupational Stress and Coping Strategies. New Delhi: Discovery Publishing House.

HSBC. (2012).Who are we.Available: http://hsbcservicedelivery.com/WhoareWe.aspx. Last accessed 14th march 2015.

Arlene Fink (2010).Conducting Research Literature Reviews: From the Internet to Paper. 3rd Ed. USA: SAGE. 3.

Kumar (2008).Research methodology. New Delhi: s. b. Nangia. 3.

Sekaran, U., & Bougie, R. (2010). Research methods for business: A skill building approach (5th Ed.). West Sussex, UK: John Wiley & Sons Ltd.

Industrial Research Institute (2010) research management. Michigan . Industrial research Institute

Saunders, M., Lewis, P. and Thornhill, A. (2009), Research Methods for Business Students, Pearson Education, London.

Lodico, M. G., Spaulding, D. T., & Voegtle, K. H. (2010). Methods in educational

Research: from theory to practice. In Introduction to educational research (pp.5-21).

San Francisco, CA: Jossey-Bass.

K. N. Krishnaswamy, Appa Iyer Sivakumar, M. Mathirajan

(2009).Management Research Methodology: Integration of Principles, Methods and

Techniques. India: Pearson Education India. 168

Jackson, SL, (2011), Research Methods and Statistics: A Critical Approach, 4thedition, Cengage Learning.

Sherri Jackson (2014).Research Methods: A Modular Approach. 3rd ed. usa: Cengage Learning. 122.

  1. Appendix

Proposed timeline for the project

Week

1

Week

2

Week

3

Week

4

Week

5

Week

6

Week

7

Week

8

Submit the proposal

Preparation of the introduction

Search of the literature

Writing the literature review

Preparing questionnaires for the survey

Gathering primary data

Preparing methodology chapter

Write up the findings from primary data collection

Evaluate & deliberate findings from primary data collection

Prepare conclusions & recommendations

Submit the project

1

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