Employees perception on recruitment and selection process in public and private sector banks

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The objective of the study is to Analysis of employees’ perceptions as to recruitment and selection process in public sector and private sector banks.

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International Journal of Management (IJM) Volume 8, Issue 5, Sep–Oct 2017, pp. 44–52, Article ID: IJM_08_05_005 Available online at http://www.iaeme.com/ijm/issues.asp?JType=IJM&VType=8&IType=5 Journal Impact Factor (2016): 8.1920 (Calculated by GISI) www.jifactor.com ISSN Print: 0976-6502 and ISSN Online: 0976-6510 © IAEME Publication EMPLOYEES PERCEPTION ON RECRUITMENT AND SELECTION PROCESS IN PUBLIC AND PRIVATE SECTOR BANKS S. Nava Rethna Bala Kumari Research Scholar, Research Centre in Commerce, Women‟s Christian College, Nagercoil, Tamilnadu, India Dr. R. Rathiha Associate Professor of Commerce, Women‟s Christian College, Nagercoil, Tamilnadu, India ABSTRACT Recruitment is the process of having the right person, in the right place, at the right time and it is crucial to organizational performance. You’ll find here information on the recruitment process, recruitment law, policy and methods, online recruitment, costs of recruitment, recruitment advertising, recruitment agencies, consultants and executive search, graduate recruitment, competency-based recruitment, application forms, curriculum vitae, and internal recruitment. The objective of the study is to Analysis of employees’ perceptions as to recruitment and selection process in public sector and private sector banks. For this purpose 250 questionnaires were filled by the bank employees. The policy and process should be revised. The process they have been adopting so far has been somewhat effective, to adapt to the changing times, the process should be revised according to the results of the study. Key words: organizational performance, Management, Information, practice and techniques. Cite this Article: S. Nava Rethna Bala Kumari, Dr. R. Rathiha, Employees Perception on Recruitment and Selection Process in Public and Private Sector Banks. International Journal of Management, 8 (5), 2017, pp. 44–52. http://www.iaeme.com/IJM/issues.asp?JType=IJM&VType=8&IType=5 1. INTRODUCTION Recruitment is the process of having the right person, in the right place, at the right time and it is crucial to organizational performance. You‟ll find here information on the recruitment process, recruitment law, policy and methods, online recruitment, costs of recruitment, recruitment advertising, recruitment agencies, consultants and executive search, graduate recruitment, competency-based recruitment, application forms, curriculum vitae, and internal recruitment. http://www.iaeme.com/IJM/index.asp 44 editor@iaeme.com
Employees Perception on Recruitment and Selection Process in Public and Private Sector Banks The term “recruitment” applies to the process of attracting potential employees to the organization or company. It is a systematic means of finding and inducting available manpower to apply to the company or enterprise for employment. Since it involves the process of searching for prospective employees, it is concerned with the range of sources of supply of labour or personnel, and of recruitment practice and techniques. The recruiting activity in itself is selective or pre-selective, through choosing among the various sources of labour supply and by the decision as to which candidates applying for employment should be permitted to go through subsequent selection or screening procedures. It is the process to discover sources of manpower to meet the requirement of staffing schedule and to employ effective measures for attracting that manpower in adequate numbers to facilitate effective selection of an efficient working force. Recruitment of candidates is the function preceding the selection, which helps create a pool of prospective employees for the organisation so that the management can select the right candidate for the right job from this pool. The main objective of the recruitment process is to expedite the selection process. Recruitment is a continuous process whereby the firm attempts to develop a pool of qualified applicants for the future human resources needs even though specific vacancies do not exist. Usually, the recruitment process starts when a manger initiates an employee requisition for a specific vacancy or an anticipated vacancy. The recruitment sources management is an extremely significant goal of the recruitment process. The recruitment sources deliver the candidates for the selection procedure in the organization. The better the candidates are; the higher quality job candidates can be hired. The proper management of the recruitment sources has a significant impact on the competitive advantage of the organization. The better employees do not have to be more expensive, but the organization has to manage the recruitment sources to attract the high quality job candidates. The external recruitment is not the only goal of the recruitment process. Building the strong internal recruitment helps the organization to keep the best talents in the organization. The employees have a chance to apply for a new job position, and they can change their career path. The internal recruitment is a difficult HR topic as the managers have to allow their best employees to take a new role within the organization. The role of Human Resources is in allowing the best employees to rotate and in supporting the managers in developing the successors. 2. PUBLIC SECTOR BANKS Public sector banks are those banks that are owned by the government. The government owns these banks. In India 20 banks were nationalized in 1969 and 1980 respectively. Social welfare is there main objective of these banks. They are divided into two groups i.e. Nationalized Banks and State Bank of India and its associates. Among them, there are 19 nationalized banks and 8 State Bank of India associates. Public Sector Banks dominate deposits and advances in the banking industry. Public Sector banks dominate the commercial banking scenario in India. These public sector banks can be further classified into: State Bank of India2) Nationalized banks3) Regional Rural Banks 3. PRIVATE SECTOR BANKS These banks are those banks that are owned and run by private sector. An individual has control over these banks in proportion to the shares of the banks held by him. Private sector banks came into existence to supplement the performance of Public sector banks and serve the needs of the economy better. As the public sector banks were merely in the hands of the government, banks had no incentive to make profits and improve the financial. The main http://www.iaeme.com/IJM/index.asp 45 editor@iaeme.com
S. Nava Rethna Bala Kumari, Dr. R. Rathiha difference is only that public sector banks follow the RBI Interest rules strictly but private sector banks can effect some changes but only after approval from the RBI 4. WHY HUMAN RESOURCE MANAGEMENT IS IMPORTANT FOR BANKS Human Resource Management is important for banks because banking is a service industry. Management of people and risk are two key challenges faced by banks. Efficient risk management may not be possible without efficient and skilled manpower. Banking has been and will always be a „People Business‟. Though pricing is important, there may be other valid reasons why people select and stay with a particular bank. Banks must try to distinguish themselves by creating their own niches or images, especially in transparent situations with a high level of competitiveness. In coming times, the very survival of the banks would depend on customer satisfaction. Values need to be emphasized through concrete actions on the ground and it would be the bank‟s human resource that would deliver this. 5. STATEMENT OF THE PROBLEM The pace of change and the uncertainty about how markets will evolve has made it increasingly important for companies to be aware of the employee selection practices they participate in and to understand the roles that they play. The ability to continuously learn the evolving bank dynamics, coupled with competence in aligning the HRD practices to changing requirement, is one of the key sources of competitive advantage in present context. But sometimes, despite the ability and competence, the banks fail to align their employee recruitment and selection practices with the fast changing requirement. Therefore, there is a great need to research the challenges in the existing employee selection practices in the banking sector in India Hence, the present study entitled “Impact of employee‟s recruitment process in public and private sector banks”, has been undertaken. The area covered is kanya kumari district only and the study is restricted to the public sector and private sector banks employees. 6. OBJECTIVES OF THE STUDY In the light of the domain for research identified so far, the following objective have been set for the present study, To Analysis of employees‟ perceptions as to recruitment and slection process in public sector and private sector banks. 7. RESEARCH METHODOLOGY This research study has been conducted and analyzed on the basis of primary data. Primary data were collected by questionnaire method from public sector banks and private sector banks. Five hundred respondents from the sample of public sector and private sector bank employees have been collected for this study. The data is collected based on stratified random sampling method. Secondary information sources used for the present research include the journals and magazines and also include websites of banks. 7.1. Employees’ Perceptions as to Recruitment and Selection Process The table describes the perceptions of the respondent employees on recruitment and the selection process applied in the sample public sector and the private sector banks as indicated by their responses which have been measured on five-point Likert Scale. To test whether there is any significant difference among sector wise analysis of employees‟ perceptions as to recruitment and selection process‟s‟ test has been applied. http://www.iaeme.com/IJM/index.asp 46 editor@iaeme.com
Employees Perception on Recruitment and Selection Process in Public and Private Sector Banks Table 1 Sector Wise Analysis Of Employees‟ Perceptions As To Recruitment And Slection Process SL:NO Variables Mean score t- P Public Private Statistics Value 1 Well defined recruitment and selection system is 4.8120 4.6040 64.747* .000 followed in our bank. 2 Line managers and HR managers participation is 4.0880 4.1920 .455 .500 high while recruitment and selection. 3 Valid and standardized tests are used in the 3.8920 4.0080 8.362* .004 selection process of employees. 4 Selection system is based on those having the 3.7520 3.9820 17.493* .000 desired knowledge, skill and attitudes. 5 Bank uses comprehensive selection process 3.6600 3.4640 7.516* .006 before rending a decision. 6 Bank uses assessment centers for selection. 3.8640 3.8480 10.293* .001 7 Bank uses unbiased test and interviewing 3.8320 3.6400 5.492* .019 techniques for employee selection. 8 Bank selects employees without any bias. 3.9080 3.6480 5.492* .019 9 A strong merit criterion is available for 3.8360 3.8600 4.856* .028 employee selection. 10 Bank uses attitude and desire to work in a team 3.9640 3.8680 .068 .795 and individual as a criterion in employee selection. 11 Moral of the existing employees can be lowered 4.0280 3.6720 17.711* .000 due to poor process of recruitment and selection. 12 Dedication of employees towards performance 3.0320 3.1800 1.377 .241 can increased due to fair practice in recruitment and selection. 13 Corporate social responsibility can lead to 3.2680 3.3680 1.709 .192 attraction of employees towards the bank. 14 Usage of competency model in selection process 4.0560 3.8320 5.571* .019 may bring transparency in recruitment and selection. 15 In selection process innovative techniques play 3.7040 3.8840 11.072* .001 an effective role. 16 There is a vast scope for improvement in current 3.9000 3.6280 5.492* .019 process of hiring. 17 The environmental factor affects the recruitment 3.9000 3.9240 7.068* .008 and selection process like (political, job market). 18 The hiring process helps in identifying the 4.0320 3.6960 13.678* .000 competence both visible and hidden aspects. 19 Current practices effectively help in reducing the 3.8080 3.7280 .587 .444 gap between available supplies against the forecasted demand. 20 Employer branding plays key role in more 2.7640 3.1600 4.307* .038 successful recruitment and retention of top talent. Overall recruitment process 3.8050 3.7593 Note: Data in parenthesis is percentage Source: Primary Data http://www.iaeme.com/IJM/index.asp 47 editor@iaeme.com
S. Nava Rethna Bala Kumari, Dr. R. Rathiha 7.2. Significant at Five Percent Level From the above, it is seen that among public sector bank employees‟ recruitment and selection process is high for the variables, „Well defined recruitment and selection system is followed in our bank‟, „Line managers and HR managers participation is high while recruitment and selection‟, „Usage of competency model in selection process may bring transparency in recruitment and selection‟, „The hiring process helps in identifying the competence both visible and hidden aspects‟, since they have the highest mean scores of 4.8120, 4.0880, 4.0560 and 4.0320 respectively. They have the lowest process for the variables, „Employer branding plays key role in more successful recruitment and retention of top talent‟, „Dedication of employees towards performance can increased due to fair practice in recruitment and selection‟, „Corporate social responsibility can lead to attraction of employees towards the bank‟, since it has the lowest mean scores of 2.7640, 3.0320 and 3.2680 respectively. Private sector bank employees‟ recruitment and selection process is high for the variables, „Well defined recruitment and selection system is followed in our bank‟, „Line managers and HR managers participation is high while recruitment and selection‟, „Valid and standardized tests are used in the selection process of employees‟, „The environmental factor affects the recruitment and selection process like (political, job market)‟, since they have the highest mean scores of 4.1920, 4.0880, 4.0560 and 4.0320 respectively. They have the lowest process for the variables, „Employer branding plays key role in more successful recruitment and retention of top talent‟, „Dedication of employees towards performance can increased due to fair practice in recruitment and selection‟, „Corporate social responsibility can lead to attraction of employees towards the bank‟, since it has the lowest mean scores of 3.1600, 3.1800 and 3.3680 respectively. Overall recruitment process is high among public sector bank employee‟s (mean score 3.8050) compared to private sector bank employee‟s (3.7593). Perhaps this may be because of the bank employee‟s most preferable to joint public sector banks than private sector banks. Regarding the employees‟ recruitment and selection process in public and private sector banks significant difference have been identified in the case of all the twenty variables except five variables, „Line managers and HR managers participation is high while recruitment and selection‟, „Bank uses attitude and desire to work in a team and individual as a criterion in employee selection‟, „Dedication of employees towards performance can increased due to fair practice in recruitment and selection‟, „Corporate social responsibility can lead to attraction of employees towards the bank‟, „Current practices effectively help in reducing the gap between available supplies against the forecasted demand‟, since their respective „t‟ statistics are significant at five percent level. 7.3. Factor loading for the variables in recruitment and selection process In this study twenty variables relating to the factor of recruitment and selection process among public sector and private sector banks namely „Well defined recruitment and selection system is followed in our bank‟, „Line managers and HR managers participation is high while recruitment and selection‟, „Valid and standardized tests are used in the selection process of employees‟, „Selection system is based on those having the desired knowledge, skill and attitudes‟, „Bank uses comprehensive selection process before rending a decision‟, „Bank uses assessment centers for selection‟, „Bank uses unbiased test and interviewing techniques for employee selection‟, „Bank selects employees without any bias‟, „A strong merit criterion is available for employee selection‟, „Bank uses attitude and desire to work in a team and individual as a criterion in employee selection‟, „Moral of the existing employees can be http://www.iaeme.com/IJM/index.asp 48 editor@iaeme.com
Employees Perception on Recruitment and Selection Process in Public and Private Sector Banks lowered due to poor process of recruitment and selection‟, „Dedication of employees towards performance can increased due to fair practice in recruitment and selection‟, „Corporate social responsibility can lead to attraction of employees towards the bank‟, „Usage of competency model in selection process may bring transparency in recruitment and selection‟, „In selection process innovative techniques play an effective role‟, „There is a vast scope for improvement in current process of hiring‟, „The environmental factor affects the recruitment and selection process like (political, job market)‟, „The hiring process helps in identifying the competence both visible and hidden aspects‟, „Current practices effectively help in reducing the gap between available supplies against the forecasted demand‟, „Employer branding plays key role in more successful recruitment and retention of top talent‟ have been analyzed with the help of factor analysis. Table 2 Rotated Component Matrix Recruitment And Selection Process Variables Merit Current Techni Attitu Selecti Select Enviro Sl: criterion practices ques de on ion nment No proces syste al s m factor 1 Bank uses comprehensive .828 selection process before rending a decision. 2 A strong merit criterion is .723 available for employee selection 3 Bank selects employees without .628 any bias 4 The hiring process helps in .881 identifying the competence both visible and hidden aspects 5 Moral of the existing .719 employees can be lowered due to poor process of recruitment and selection 6 Current practices effectively .710 help in reducing the gap between available supplies against the forecasted demand 7 Corporate social responsibility .526 can lead to attraction of employees towards the bank 8 Line managers and HR .813 managers participation is high while recruitment and selection 9 Bank uses unbiased test and .742 interviewing techniques for employee selection. 10 Bank uses assessment centers .636 for selection. 11 Employer branding plays key .748 role in more successful recruitment and retention of top talent. 12 Dedication of employees .724 towards performance can http://www.iaeme.com/IJM/index.asp 49 editor@iaeme.com
S. Nava Rethna Bala Kumari, Dr. R. Rathiha increased due to fair practice in recruitment and selection. 13 Bank uses attitude and desire to .690 work in a team and individual as a criterion in employee selection. 14 There is a vast scope for .779 improvement in current process of hiring. 15 Valid and standardized tests are .603 used in the selection process of employees. 16 Usage of competency model in .551 selection process may bring transparency in recruitment and selection. 17 Selection system is based on .514 those having the desired knowledge, skill and attitudes. 18 Well defined recruitment and .810 selection system is followed in our bank. 19 In selection process innovative .820 techniques play an effective role. 20 The environmental factor .676 affects the recruitment and selection process like (political, job market). Eigen value 2.723 2.666 2.413 2.107 1.841 1.664 1.492 Percent of variation explained 13.616 13.328 12.064 10.537 9.204 8.318 7.461 KMO measure of sampling Bartlett‟s test of sphericity: Adequacy : 0.732 Chi-square value :4516.453 Df :190 Significance value :.000 Extracted method: Principal component analysis Rotation method: Varimax with Kaiser Normalization The KMO measure of sampling adequacy and Bartlett‟s test of sphericity have been conducted to test the validity of data, since their KMO measure is greater than 0.5 i.e. (.732) and the chi- square value is 4516.453 at degrees of freedom which is significant at five percent level. The above table indicates the rotated factor loading for the twenty variables. It is clear from that table that all the twenty variables have been extracted into seven factors. The number of variables in each factor, Eigen value and the percent of variance explained by the factor are presented in the table .3 http://www.iaeme.com/IJM/index.asp 50 editor@iaeme.com
Employees Perception on Recruitment and Selection Process in Public and Private Sector Banks Table 3 Factor Loading for Recruitment and Selection Process Sl:NO Factors Number of Eigen value Percentage of Cumulativepercenta variables variation ge of variation explained explained 1 Merit criterion 3 2.723 13.616 13.616 2 Current practices 4 2.666 13.328 26.944 3 Techniques 3 2.413 12.064 39.008 4 Attitude 3 2.107 10.537 49.545 5 Selection process 4 1.841 9.204 58.749 6 Selection system 1 1.664 8.318 67.067 7 Environmental 2 1.492 7.461 74.528 factor Source: Computed data The highly viewed factor is „Merit criterion‟ since its Eigen value is 2.723. „Merit criterion‟ has the variance of 13.616 percent. „Bank uses comprehensive selection process before rending a decision‟ has a high factor loading of .828, followed by „A strong merit criterion is available for employee selection‟.723and „Bank selects employees without any bias‟.628 are the variables included in this factor. The second factor considered is „Current practices‟ which has a percentage of variance of 13.328 and its Eigen value is 2.666. This factor variables are „The hiring process helps in identifying the competence both visible and hidden aspects‟ .881, „Moral of the existing employees can be lowered due to poor process of recruitment and selection‟ .719, „Current practices effectively help in reducing the gap between available supplies against the forecasted demand‟ .710 and „Corporate social responsibility can lead to attraction of employees towards the bank‟ .526. Third factor is „Techniques‟ since its Eigen value is 2.413. This factor explains the variable considered in recruitment and selection process to the extent of 12.064 Percent. „Line managers and HR managers participation is high while recruitment and selection‟ (.813), „Bank uses unbiased test and interviewing techniques for employee selection‟ (.742) and „Bank uses assessment centers for selection‟ (.636) are the variables included in the factor „Techniques‟. Fourth factor is „Attitude‟ since its Eigen value is 2.107. „Attitude‟ has the variance of 10.537 percent. „Employer branding plays key role in more successful recruitment and retention of top talent‟.748, „Dedication of employees towards performance can increased due to fair practice in recruitment and selection‟ .724 and „Bank uses attitude and desire to work in a team and individual as a criterion in employee selection‟ .690 are the variables included in this factor. The next factor considered is „Selection process‟ which has a percentage of variance of 9.204 and its Eigen value is 1.841. This factor variables are „There is a vast scope for improvement in current process of hiring‟ .779, „Valid and standardized tests are used in the selection process of employees‟ .603, „Usage of competency model in selection process may bring transparency in recruitment and selection‟ .551 and „Selection system is based on those having the desired knowledge, skill and attitudes‟ .514. The next factor is „Selection system‟. Its Eigen value is 1.664. The variance explained by the factor is 8.318 percent. The variables „Well defined recruitment and selection system is followed in our bank‟ .810. The last factor narrated in the Factor Analysis is „Environmental factor‟ since its Eigen value is 1.492. The variance explained by the factor is 7.461 percent. The variables „In selection process innovative techniques play an effective role‟ .820 and „the environmental factor affects the recruitment and selection process like (political, job market)‟ .676 is the variables included in this factor. http://www.iaeme.com/IJM/index.asp 51 editor@iaeme.com
S. Nava Rethna Bala Kumari, Dr. R. Rathiha 8. SUGGESTIONS  HR department is meant to perform various important functions in bank. But the most important is to recruit the employees. Other functions are also important but the importance as indicated by the bank varies and respondent have differences of opinion on it.  The main important thing for an organization is the recruitment, which exists in this bank, is assumed traditional. In this case, what they can do is that they can go for campus recruitment, hire institute for helping them recruiting people.  The bank can also go for online recruitment, which is a modern method.  The public and private sector bank is running a well-designed recruiting process but they should follow an influence free and fair judgmental decision to recruit any new employee.  The public and private sector bank should analyze the recruitment and selection process as per the opinions of the employees by consolidating with the policy of the bank. 9. CONCLUSIONS For the recruitment and selection of good employees in banks or in any other organization proper procedure is to be followed. As discussed above the various process of recruitment are followed by banks. With the accurate process of recruitment right kind of financial and non financial incentives are to be followed for selection of employees. As has been seen, the recruitment and selection process of the public and private sector bank has enough scope for improvement. The policy and process should be revised. The process they have been adopting so far has been somewhat effective, to adapt to the changing times, the process should be revised according to the results of the study. REFERENCES [1] Ayesha, T. (2011) “The Process of Recruitment and Selection in a Developing Country: Case Study of a Bank in Bangladesh”, ABAC Journal. 31(1): 55-67. [2] Corporate information of The Dhaka Bank Ltd. in www.dhakabankltd.com. [3] Ewart, K and Susan, J. (2010) “Recruitment and Selection –the Great Neglect Topic”, SKOPE Research Paper No.88. [4] Khandaker, M. (2013) “The Recruitment and Selection Process –A Case Study on First Security Islami Bank Ltd. An Internship Report Submitted to the Department of Business Administration”, City University, in partial fulfillment of the requirements for the degree of bachelor of Business Administration. [5] Manual of the human resource management of The Dhaka Bank Ltd. [6] Rimjhim, G and Tanuja, J. (2014) “Role of Recruitment & Selection Policies in Central Co-operative Banks”, International Monthly Refereed Journal of Research in Management & Technology. III: 74-79. [7] Rezaul, K. B and Rashidul, H (2014) “JS panel unhappy as no action taken against ex- chairman of BASIC”, Daily Star Business. Pp. B1-B3. [8] Sneha, M. (2014) A Critical Study on Recruitment and Selection with Reference to HR Consulting Firms”, Indian Journal of Research. 3(3): 108-111. [9] Kirti Makwana and Dr. Govind Dave, Strategically Leveraging CSR as A Recruitment Tool To Enhance Organizational Attractiveness” - A Survey of It Professionals of Gujarat. International Journal of Management, 7 (4), 2016, pp. 152–164 [10] Vilas Balgaonkar, Snehal Bidkar, Rajshekar R. Yelikar, Study on Employees Perception Towards Hrd Climate In Textile Mills. Journal of Management (JOM), 1 (1), 2013, pp. 39–43 [11] Khalil Ghazzawi PhD, AymanAbdallah PhD, Jean Abdallah, AbeerAccoumeh, Critical Success Factors Of The E-Recruitment System, International Journal of Marketing and Human Resource Management (IJMHRM), 5 (3), 2014, pp. 01–09 http://www.iaeme.com/IJM/index.asp 52 editor@iaeme.com