UNIVERSITY OF BEDFORDSHIRE

LEADING PEOPLE IN ORGANIZATIONS SHR601-6

Assessor: Dr PAULINE LOEWENBERGER HSBC CASE STUDY

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Financial Institutions are known to be highly imperative of continuation of globalization throughout the world. Hence each and every economy has to focus on establishment and proper functioning of both local and globalised financial institutions. HSBC is one of world recognized organization which has great influence on world economy. HSBC can be identified as world largest banking and financial service corporation which was established in !! as a parent company for Hong "ong and Shanghai Banking Corporation. Company occupies #$%&&& employees. 's HSBC is an organization dealing with risky conditions related to financial management( human talent would be most important asset of an organization. )o con*uer full commitment from employees( HSBC uses different human resource management policies and practice. Conversely organization need to be conscious of cultural diversity of people as it has circulated branch network among numbers of countries with different cultural backgrounds. Hence H+, practices of organization supposed to be differed from region to region.

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Table of Contents...................................................................................................................3 Introduction............................................................................................................................. 4 Analysis of HSBCs HRM policies and practices in ast Asia.................................................4 Recruit!ent and Selection..................................................................................................4 Trainin" and #e$elop!ent..................................................................................................% Conclusion............................................................................................................................ &' Reco!!endations................................................................................................................ &' About HSBC (2'&&)(*nline)+ A$ailable fro! ,ttp-..///.,sbc.co!.about0,sbc 1Accessed on 22.'3.2'&33.......................................................................................................................... &3

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Increasing globalization has created more awareness of the need for managers to be sensitive to the cultural aspects in human resource management. -roper human resource management brings an understanding regarding the values and beliefs of employees from different cultural backgrounds. )his report is comprised with evaluation and analysis of key performance areas in human resource management of HSBC Holdings -.C. HSBC as an organization which operates globally with thousands of employee base( strategic H+, is inevitable. +ecruitment and selection process of organization performs a significant role in attracting talent to the organization. )raining and development strategy enhances employee /ob performance as well as career growth( further performance management and reward strategy defines the evaluations and returns for better performances. +ecommendations have addressed aspects to be improved.

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Human resource policies and practices grant organization to structure to be followed and guidelines for reacting to particular situations 0'lc1zar et al( #&&23 p.$445. If organization does not have specified policies and practices of H+, it will complicate the situation rather than resolving it. In the conte6t of HSBC( organization cannot implement standardized H+, system with standard policies and practices in each region of world. Hence HSBC has taken up cultural differences in to consideration when stipulating H+, policies and implementing H+, practices. Re!r"$#&e,# ',- Se*e!#$o, 's per Schuler and 7ackson 0#&&&3p.$25( the process refers to identifying best suited employee for a particular position among pool of candidate is known as recruitment and selection. 8very organization should be comprised of specified and appropriate recruitment and selection policies which encounter of selecting most suitable candidate who matches with organizational re*uirement.
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9hen HSBC was moving in to 'sian market( especially in to 8ast 'sia they had to face with problem of deficient in re*uired talent from local labour markets. ,any of 'sian economies Such as China and :ietnam often have unskilled and semi;skilled workers but not trained people with re*uired skills. 's other ,<Cs( HSBC also had to adopt ethnocentric approach in to their recruitment policies and procedures. )his problem became more critical as HSBC was e6panding businesses over the globe. Because of this HSBC was face with difficulty in finding skilled bankers locally 0)reanor( #&&%3p.425. )his may be a challenge to business e6pansion in developing countries where level of education remains at a lower level. +ecruitment and selection process of HSBC is initiated with filling online C: in electronic form. 'fter referring the C: by H+ team of HSBC determined it as suitable or not for particular position. )hose applications will be checked against the prere*uisite skills and *ualification re*uired for /ob 0)iwar and Buse( #&&$3p. #5. )hen candidates have to countenance with ability test which known as aptitude test. In this scenario H+ team of HSBC considers cultural barriers and perceptions of people. 's an e6ample perceptions of 'sian person might be totally different from 8uropean person. Hence HSBC never tries to attitudes of people using *uestions e6posed to cultural differences. Selected candidates should be confronted for face to face interview and outstanding personalities will be selected. If organization is unable to find suitable people they have to import talent from foreign which incurs larger cost to the organization. 's a solution( HSBC used =lobal or International )alent ,anagement process as a mean of attracting( retaining and motivating people. 8thnocentric approach is used by organization for most of occasions( but there were some instances where it is no longer suitable. Hence need for proper program became inevitable 0Brunner et al( #&&>3p.!&5. 's the first step of International )alent ,anagement process( need to identify senior manager talent pool among management positions. For this HSBC uses 4$& ?egree feedback( interviews( -anel assessment and self and manager assessments with the purpose of collecting information who suits for management positions 0Storey( #&&#3 p.#425( @rganisation e6pects to avoid need for recruiting foreign employees for managerial positions of branches in developing countries such as China( :ietnam and <epal. HSBC emphasizes on integrity( collegiality and diversity as core competencies needed for a leader. 'fterwards they e6pand talent pool beyond the senior management and forward to /unior managers and other competent employees. )hrough

development programs focused on core competencies( organization e6pects to develop leadership of all level employees.

Figure no.& 3 =lobal )alent ,anagement -rocess at HSBC 0Source3 ww.slideshare.netAadelinawomackAglobal;talent;management;at;hsbc;5 +ecruitment process of HSBC is different from country to country. )here may be two different systems of recruitment in 8urope and 'sia. It is an advantage for organization as it helps to identify cultural differences and organization will be able to turn those implications in to opportunities for gaining higher level of commitment from employees. If organization is implementing standard system over the globe it would not beneficial for organization as each country and people may not desire to move with that system 0,artin et al( #&&23p.#$45. If so it may create internal troubles as well as e6ternal troubles. If we considered International )alent ,anagement process it will be greater opportunity for middle and lower level employees to climb up their career ladders through own competencies. )his process can e6plain using behavioral theory of leadership which describes leaders may not instead they are made 0,archington and Bagelmeyer( #&&23p.445. Believing above phase HSBC is attempted to create future leaders within organization eliminating need for headhunting or recruiting talent e6ternally.

Tr'$,$,1 ',- De%e*o0&e,# 's globe is e6posed to tentative( compound and erratic situations( has a pressure on organisation to constantly develop and be adoptable with both e6ternal and internal environmental dynamics. ,ost of business organisations mainly compete through human
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talent. Hence they should be prepared employees for successfully deal with upcoming situations 0+osemary( #&&23p.25. Basically training is a methodical procedure of mounting knowledge( skills and attitudes to enhance performance of current /ob which helps individual employee to meet up with /ob re*uirements easily up to the e6pected level 0?erek(#&&>3p.4$45. Conversely development refers to developing employees to do more challenging /ob in future. In other words development can be defined as e*uipping employees to take more challenges in the future. In the conte6t of HSBC( they organise and design training programs by regional training teams. But they disseminate instructions to each country and Country H+ manager and H+ team will be responsible of implementing training programs in local offices. 's per Bowers 0#&&C3p.#>5( each and every employee eligible for training programs depending on their service period. HSBC has placed vast attention on training and development of employees in HSBC offices located in developing countries. Hence they have used number of training methods to train employees such as management training( leadership training( language and technical skill training 09illiam et al( #&&>3p.>5. )hose are common for all departments. 'ddition to those employees of 8ast 'sian countries have provided with special skill trainings as class room based trainings kind of off the /ob training program and day to day or on the /ob training program which is a multimedia based e; training. 'nalyzing the training and development in HSBC it is possible to say organisation is always tries to make their employees competent through developing re*uired talents and skills. )hrough training HSBC employees will be able to improve their individual performance and thereby it helps to augment whole organisational performance. 's employees become more talented it will increase the service *uality of HSBC. @ne of imperative strength of organisation can be derived as training and development and it would raise HSBC as worldDs best financial institution. @n the other hand training and development of HSBC helps to improve work efficiency by reducing wastage. It will offers further competitive price for end services. )hrough this HSBC has become organization with one of best customer services in the world.

'ccording to two factor theory of motivation by Fredrick Herzberg( every person has two levels of needs as physical level and psychological level. ,otivators are intrinsic factors which mount the morale. 'ccordingly career development also can be defined as motivational factor which enhances employee commitment and satisfaction 0Cohn et al( #&&23p.C45. ,oney is not sole motivator at the employment( and this is especially very true for the #
st

century. )he people who work with organizations seek for more than fair

employment from workE they also look at the holistic development of themselves. Since HSBC is offering employees with numerous training and development opportunities it will be back;up for employees to develop themselves. But one of weakness of )raining and development of HSBC is lack of identifying individual weaknesses.

Re2'r- S(s#e& 'ccording to 9illiams( #&&43p.#C( reward can be defined as a stimulus which encourages employees to e6ert higher level of commitment and effort towards the /ob tasks. In another words reward system of particular organization can be defined as a mean for bridging the gap between ability to work and motivation to work. Since ma/ority of 'sian countries have limited number of skilled labour( need to be highly competitive through offering spirited compensation and rewordings. @therwise organization may not be able to attract talented candidates and retain competent employees 0=ibbons and 9oock( #&&%3p.#%5. ,ainly there are two types of rewards as financial rewards and non; financial rewards. @n the other hand each reward should be attractive to employees and need to be aligned with organizational strategies. HSBC offers their employees different employee rewards both financially and none financially. In another words( HSBC is offering intrinsic and e6trinsic rewards. 'mong most of other global organisations HSBC has ranked as one of well;paying firm for own employees. HSBC has espoused an ethnocentric approach to its reward system. 's e6plained by ?aniels 0#&&>3p.#425( through rewarding system organisation e6pects to increase productivity by mounting average performances of employees. By offering reward system( organisation hopes to pull people towards their ma6imum effort in accomplishing particular task. HSBC has offered standard procedure for reward management including policies which offers ability to react in different situations. Conversely rewards may be
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morale boosters which help to accomplish particular task effectively. )his can be e6plained through 86pectancy theory of motivation. It defines that individual employee believes that his or her effort will lead to better performance and in turn it will guide to organizational reward. In the conte6t of HSBC( employees are committed for work mostly for financial rewards such as bonuses and salary increments. 'ddition to those they will inclined to retain with the e6pectation of receiving e6trinsic rewards such as retirementDs benefits and other employee benefits.

Figure & 3 86pectancy )heory 0Source3 ?eveloped by @wn5 +ewards system of HSBC would be a control for managing tardiness and absenteeism. 9hen employee performances link with rewarding system they will become motivated for organizational functions and tend to be avoided negative attitude and practices towards the work. 9hen employees are rewarded with non;financial rewards such as promotions( status and ranking and etc employees will be satisfied of the /ob as they are gratified social and psychological needs0 Baffron and Steve( #&&!3p.C!5. Before stipulating reward system HSBC is often consider views and e6pectations of employees. If not employees will not be interested for given rewards and will not be motivated to e6ert ma6imum effort further 0Hewstone and Brown( #&&&3p.225. 8ach reward system implements by HSBC is easy for employees to understand. Hence employees can work out of it without difficulty. )hereby confidence and trust of employees towards the organization will increase. 8mployees of HSBC are entitled for selecting desired rewards among others. 'ccordingly they are given with prere*uisites that should be accomplished in attaining particular goals.

)his would be positive point for organization as it boosts ability to alter with employee preferences and needs of any transform in the conditions. 8ven though rewarding system of HSBC has number of positive implication( can be seen some negative aspects as well. )here is a problem with /ust and e*uitability in rewarding .)his situation is critical in 'sian countries as managers tend to be rewarded employees depending on favourations rather than considering competencies. 's per =lisson and . 7ames 0#&&#3%$%5( due to this situation problems may be created for organization as employees perceive they are treated une*ually. )hus HSBC employee turnover is somewhat higher than employee turnover of 8uropean and 9estern countries.

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Having analyzed the case of HSBC Holdings -.C( as a assignment re*uirement( able to gain a wide understanding about Human +esource ,anagement in a practical scenario and identified factors which can be affected on leading employee behavior for achieving organizational goals and ob/ectives. 'nalysis of HSBCDs H+, policies and practices in 8ast 'sia has evaluated positive and negative facets of organizational performances considering imperatives areas as recruitment and selection( training and development and reward system. 'ccordingly recommendations are proposed to overcome shortcomings with human resource facets of an organization. ,odern @rganizations are competing through human talent. )herefore human resource becomes most valuable assets in every organization. )his study has given me a broader knowledge. ,y intention was not only to fulfill the assignment re*uirement but also to understand the practical application of the theories we learnt under the sub/ect Human +esource ,anagement.

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+ecruitment is a crucial area of H+, as it mainly deals with attracting new blood to organization. Hence organisation can establish recruitment policy which linked and reflect corporate strategy of organisation. )hrough this organisation will be able to attract employees who can occupy in achieving organizational ob/ectives and people with competencies
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attaining those. )his would be addressing specific need of recruiting candidate for a particular /ob position. @n the other hand HSBC can be conscious of Cultural dimensions across countries and take advantages from them. 'ccording to the Cultural dimensions of HofstedeDs( different regions of countries have distanced cultural implications ..inking those in to recruitment processes of each country( organization will be able to gain cultural opportunities in attracting employees. )his would be an advantage to attract most talented people from pool of limited *ualified bankers in 8ast 'sian countries. HSBC has placed small attention on individual weaknesses in planning training and development program. Instead they pull employees towards training and development programs insisting on seniority and service period. If organization pays attention on individual weaknesses( it will be much helpful in correcting their performance drawbacks and enhancing employee performances up to the e6pected limit. HSBC can link grievance handling procedure with rewarding system. 'ny rewarding system may create grievances for a certain e6tent. Hence management of HSBC can develop effective grievance procedure linked to reward system. )hereby organization will be able to diminish conflicts can be occurred. -erformance management and reward system should be more tailored. Current performance management system is considered only the /ob related aspects. But it is important to evaluate all other characteristics of employees which related with their performances either directly or indirectly. In turn organization will be able to create balanced employees who can manage time and work with outstanding personality repercussions.

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Re+ere,!es
'lc1zar( F.( -. ,. Fern1ndez F Forteza( 7.'.( and -rieto( 7., 0#&&25, Strategic human resource management3 integrating the universalistic( contingent( configurational and conte6tual perspectives, International Journal of Human Resource Management ( p $44 Brunner( '.( ?ecressin( 7. (Hardy( ?. and "udela( B. 0#&&>5( Germanys Three-Pillar Banking System ross- ountry Pers!ecti"es in #uro!e( @ccasional -aper( International ,onetary Fund( 9ashington ?C (p.!& Bowers( S. 0#&&C5( HSBC loses disk with policy details of 4%&(&&& customers( The Guar$ian 0.ondon5(p.#> Cohn( 7.,.( "hurana. +( and +eeves( .. 0#&&25( =rowing talent as if your business depended on it( Har"ar$ Business Re"ie%( p.C4 ?aniels( '. 0#&&>5( Performance Management& (rgani)ational #ffecti"eness, >th 8dition( p.4>2 ?erek( ).( .aura( H. and Stephen( ). 0#&&>5( Human Resource Management($th 8ditiion( -earson 8ducation. p. 4$4 =ibbons( 7 and 9oock( C 0#&&%5( 8vidence;based Human +esources( The Boar$( <ew Gork(p #% =lisson( C. and .. +. 7ames 0#&&#5( the cross;level effects of culture and climate in human services teams( Journal of (rgani)ational Beha"ior( p %$% Hewstone( ,.( and Brown( +. 0#&&&5( ontact an$ conflict in intergrou! encounters( @6ford3 Basil Blackwell .td(p 22 onference hanging Beha"ior that 'ri"es

,artin( '. 7.( 7ones( 8. S. 7. and .osey( ,. 0#&&25( )he role of psychological climate in facilitating employee ad/ustment during organizational change( #uro!ean Journal of *ork an$ (rgani)ational Psychology( p #$4

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,archington( ,. and S. Bagelmeyer 0#&&25( +ore%or$& linking H+, and performance ;;never;ending searchH( Human Resource Management Journal( p 44 +osemary( H. 0#&&25( ,earning an$ 'e"elo!ment( 2 th 8dition( CI-? -ublishing(p. 2 Schuler( +.S. and 7ackson( S.8. 0#&&&5( Managing Human Resources- - Partner Pers!ecti"e (.ondon()homas .earning(p $2 Storey( 7. 0#&&#5( Introduction3 from -ersonnel ,anagement to Human +esource ,anagement(Human Resource Management& a critical Te.t( .ondon(p #42 )reanor( 7. 0#&&%5( )aiwan gives HSBC I%2&m to take on Chinese bank( The Guar$ian( .ondon( p.42 )iwari( +. and Buse( S. 0#&&$5( The German Banking Sector& an$ ontentment( Hamburg Jniversity of )echnology( p. om!etition, # onsoli$ation

9illiam( 7.( +othwell( ,. and "azanas( H. C. 0#&&>5( The Strategic 'e"elo!ment of Talent( 4rd 8dition( Human +esource ?evelopment -ress. p. > 9illiams( 7. =. 0#&&45( the importance of H+ practices and workplace trust in achieving superior performance3 a study of public;sector organizations( International Journal of Human Resource Management( p #C Baffron( .. and Steve( ?. 0#&&!5( Performance Management& The Three ,a%s of Performance& Re%riting the +uture of /our (rgani)ation an$ /our ,ife, >th 8dition(9illey and Sons(<ew Gork(p.C! We) Re+ere,!es HSBC bank Kto offshore more /obsK 0#&&25( 0@nline5( 'vailable from

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