28-07-2014, 02:11 PM
THE IMPACT OF TRAINING ON EMPLOYEE PERFORMANCE: A CASE STUDY OF HFC BANK
HFC BANK.pdf (Size: 415.48 KB / Downloads: 208)
Abstract
The quality of the human resource of an organization is essential to its success. Thus, every organization must seek to improve the quality of its workforce. One way of achieving this is through training. The importance of training can only be appreciated with a clear understanding of its direct impact on employee performance. An improvement in employee performance also leads to an improvement in the company’s performance. It is in this respect that HFC Bank (Ghana) limited was analyzed to establish a correlation between its training programs and the success of the company. Data was derived through questionnaires distributed to selected employees as well as the finance and human resource managers. The results revealed that HFC Bank had a comprehensive (planned and systematic) in house training program that every employee was aware of. The objective of the program is to improve both individual and organizational performance. Every employee no matter their educational background or level within the company had benefited from the in house training program. However, this is the only form of training that exists. The firm is therefore advised to ensure that the program is consistently evaluated to ensure its compatibility with global changes and changes within the banking industry. The possibility of other forms of training like external courses should be considered to offer employees choice also allowing those who benefit from external courses to
v
contribute their knowledge and observations to the existing system in the bank
Introduction
The purpose of this research is to identify the impact training has on employee performance. The research is a case study on HFC Bank (Ghana) limited. Thus data will be collected through questionnaires distributed to employees, the human resource manager and the finance manager to identify whether training for employees exists and the impact on the performance of employees. The banking sector was selected because it forms a significant portion of the service sector of the economy, which contributes about 31.81% (Institute of Statistical and Social Research, 2008) of Ghana’s Gross Domestic Product. This representation is high above the industrial sector (25.89%), (Institute of Statistical and Social Research, 2008) being the second best contributor to Ghana’s Gross Domestic Product (GDP). The selection of HFC Bank is based on its position as the premier mortgage finance institution in the country. The company requires employees with specialist skills, the need therefore to identify the role training will play in improving these skills. HFC Bank (Ghana) Limited, formerly Home Finance Company was incorporated on 7th May 1990, under the Ghana Companies Code 1963 (Act 179), as a private limited company and the premier apex mortgage financing institution in Ghana. It commenced business on December 2 1991. The company was by then promoted by the Government of Ghana (GOG), The Social Security and National Insurance Trust (SSNIT) and Merchant Bank (GH) Ltd.
Problem statement
Training enhances skills, knowledge, attributes and competencies and ultimately worker performance and productivity in organizations (G.A Cole, 2002). Many organizations in Ghana engage in training and development of its staff and also have departments, units and sectors that cover training and development. HFC bank (Ghana) limited is one such organization that practices training.
The HFC Bank (Ghana) limited, at its Annual General Meeting for year 2008 (April 2009) has been authorised by its shareholders to raise new capital of US$ 30 million, part of which will be deployed for growth and significant branch expansion. Given the human resource needs that will arise from growth and expansion objectives, it is worth investigating the extent to which training and development will be deployed by HFC Bank as an instrument to
Relevance of the study
The study will help firms understand the importance of training programs. It will also enable them structure their training programs to make them more effective in terms of helping to improve the efficiency of the workforce and
lead to better performance. This also ensures the existence of a pool of skilled workforce who could be utilized for national development. Labour is a major input to the success of the company. If labour is efficient it will help improve the performance of the company. As companies perform better they are able to increase output and contribute more to the economy. They are also able to grow and hire more people thus helping to decrease the level of unemployment. As companies perform better, they are also able to compete better enabling the economy to remain vibrant.
Importance of training
Training is a tool which helps organizations to gain a competitive edge. According to Krietner (1995) in his book The Good Manager’s Guide, no matter how carefully job applicants are screened, typically a gap remains between what the employee does know and what they should know. There is
11
therefore the need for organizations to train their human resource to be able to learn in order to acquire more skills and knowledge to beat competition.
Training is a key element for improved organizational performance through the increasing level of individual competences. This means that training will help employees to master knowledge, skills, behaviors, sense of self worth and confidence upon which they are able to perform efficiently to improve on the performance of the organization.
Among the many benefits of training, training can also eliminate risks in organizations because the trained personnel will be efficient, thus will be able to make better use of the organizations property thereby reducing and avoiding waste. Training will also make the employees feel a sense of security thus labor turnover can be avoided. According to Cole (2002) training can achieve lower cost of production, lower turnover and change management.
Determining training needs
Training needs analysis answers the questions, who if there is, needs training? And what training should be given? There is therefore the need for any organization to first identify the training needs of the organization. The need for training should be identified in accordance with a well organized procedure looking at the training needs from the organizational and employee perspective.
Based on the organizational analysis, the organization can assess the level of growth over a defined period of time and then determine the shortfalls and problems in order to help determine the required training programs. Also in
13
identifying the training needs from the employees’ perspective, the organization can measure the performances of individual employees. This can be measured by analyzing the efficiency of the individual employees against the required standards set by the organization through frequent performance appraisals.
The difference in the organization and employees actual results expected as well as feedback from customers and shareholders of the organization all can help identify training needs. However this will depend on
CONCLUSIONS AND RECOMMENDATIONS
This chapter will present a detailed analysis of results, conclusions and recommendations for the study in answering the research questions. It starts by addressing the research questions, and then gives the conclusion based on the analysis from the results followed by the proposed recommendations.
The study covered twenty-two employees of HFC Bank’s Head Office. Out of these 22 respondents 13 of them were males and the rest of the 9 respondents were females. This statistics corresponds to the current representation at the bank. However there was no distinct pattern in responses provided by the two groups. Both categories of respondents responded in the same way to the questions in the questionnaire. The researcher however expected that, the respondents from the upper level management might have undergone more diverse training than the respondents from the middle level management. However from the results, both the upper level management and the middle level management have participated in training provided in house.
Objectives of Training
It is very essential that the employees who undergo the training know the objectives for each training program they undertake. Employees’ knowledge of the reason for which they undergo training will help them be focused and enable them appreciate the program. It will in the long-run also reflect in the growth of the bank through the profits, reduced time periods on the job among others. The bank however is also certain and confident of a strong employee base who are ready to work under changes in the banking sector that may occur and also replace the experienced employees who may retire or leave the business.
Conclusion
HFC Bank has training programs for its workers. Specifically, it has an in house training program which was introduced from the inception of the bank. All employees no matter their qualification, age or rank consistently go through in-house training. Training has been effective with its core objective being to improve individual and organizational performance as can be seen from the improvement in returns per unit invested in expenditure as well a consistent increase in income and profit. The training program is structured, planned and systematic and has resulted in improvement in skills, efficiency and performance as well as the acquisition of new skills and knowledge. Training has had an effect on the performance of the firm with increased profits and income as well as an increase in income per unit of expenditure invested. HFC Bank however, should consider the possibility of other training programs besides its In house one so as to ensure that the bank is abreast