06-05-2013, 03:47 PM
A study on performance appraisal system of employees in Federal Bank.Ltd
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INDIAN BANKINGN SECTOR
INDUSTRY PROFILE
A bank is a financial institution and a financial intermediary that accepts deposits and channels those deposits into lending activities, either directly or through capital markets. A bank connects customers that have capital deficits to customers with capital surpluses.
In 1901, Justice Holmes wrote, in an Irish case (Re Shields Estate):
"The real business of the banker is to obtain deposits of money which he may use for his own profit by lending it out again."
Definition of a Bank
Oxford Dictionary defines a bank as "an establishment for custody of money, which it pays out on customer's order."
Finance has a crucial role in economic development of a country. Banking industry plays an important role in development of an economy. The banking system in India has undergone significant changes during last two decades .there have been new banks ,new instruments ,new windows ,new opportunities and along with all these, new challenges .
During Second World War there was a mushroom growth of banks in India. The number of banks increased from 1951 in 1939 to 5335 in 1945 .But this growth was primarily quantitative, planned and controlled .during 1959-1960, eight banks were bought under government control as subsidies of state bank of India. Later due to the amalgamation of state bank of Jaipur and state bank of Bikanar in 1963, the numbers of subsidies were reduced to seven.
CENTRAL BANKING SYSTEM
A central bank is the term used to describe the authority responsible for policies that affect a country’s supply of money and credit. More specifically, a central bank uses its tools of monetary policy—open market operations, discount window lending, changes in reserve requirements—to affect short-term interest rates and the monetary base (currency held by the public plus bank reserves) and to achieve important policy goals.
The story of central banking goes back at least to the seventeenth century, to the founding of the first institution recognized as a central bank, the Swedish Riksbank. Established in 1668 as a joint stock bank, it was chartered to lend the government funds and to act as a clearing house for commerce. A few decades later (1694), the most famous central bank of the era, the Bank of England, was founded also as a joint stock company to purchase government debt.
The Reserve Bank of India (RBI) is India's central banking institution, which controls the monetary policy of the Indian rupee. It was established on 1 April 1935 during the British Raj in accordance with the provisions of the Reserve Bank of India Act, 1934. The share capital was divided into shares of 100 each fully paid which was entirely owned by private shareholders in the beginning. Following India's independence in 1947, the RBI was nationalized in the year 1949.
The RBI plays an important part in the development strategy of the Government of India. It is a member bank of the Asian Clearing Union. The general superintendence and direction of the RBI is entrusted with the 20-member-strong Central Board of Directors—the Governor (currently Duvvuri Subbarao), four Deputy Governors, one Finance Ministry representative, ten Government-nominated Directors to represent important elements from India's economy, and four Directors to represent Local Boards headquartered at Mumbai, Kolkata, Chennai and New Delhi. Each of these Local Boards consists of five members who represent regional interests, as well as the interests of co-operative and indigenous banks.
Company analysis
COMPANY PROFILE
FEDERAL BANK .Ltd
Federal Bank Limited is a major Indian commercial bank in the private sector, headquartered at Aluva, Kochi, Kerala. The history of Federal Bank dates back to the pre-independence era. Though initially it was known as the Travancore Federal Bank, it gradually transformed into a full-fledged bank under the able leadership of its Founder, Mr. K P Hormis. The name Federal Bank Limited was officially announced in the year 1947. Since then there has been no looking back and the bank has become one of the strongest and most stable banks in the country. As of March 13, 2012, it has 938 branches spread across 24 states in India and 803 ATMs around the country(across 108 metro centers, 224 urban centers, 384 semi-urban locations and 87 rural areas).The bank is planning to expand its branch network to 1000 by march 2012.
VISION
• Become the dominant “numero uno” bank in Kerala and a leading player in target markets.
• Be the ‘trusted’ partner of choice for target (SME, Retail, NRI) customers.
• Be a customer-centric organization setting the benchmarks for service.
• Offer innovative yet simple products supported by the state-of-the art technology.
• Have a dynamic and energized workforce with a strong sense of belonging.
• Deliver top tier financial performance and superior value to stakeholders.
• Be a role model for corporate governance and social responsibility.
MISSION
Devote balanced attention to the interests and expectations of stakeholders, and in particular:
• Shareholders: Achieve a consistent annual post-tax return of at least 20% on net worth.
• Employees: Develop in every employee a high degree of pride and loyalty in serving the Bank.
• Customers: Meet and even exceed expectations of target customers by delivering appropriate products and services, employing, as far as feasible, the single-window and 24-hour-seven-day-week concepts, leveraging strengthened branch infrastructure, ATMs, and other alternative distribution channels, cross-selling a range of products and services to meet customer needs varying over time, and ensuring the highest standards of service at all times.
MUTUAL FUNDS
Investors are attracted to mutual funds for variety of reasons. Some of these benefits are professional investment management, diversification, low cost, convenience and flexibility, quick, personalized service, ease of investing, total liquidity, easy withdrawal, investor information, periodic withdrawals, dividend options, etc.
FEDERAL PURE GOLD
Federal Bank brings you gold in its purest form Gold bullion of 24 carat ,it is available at Federal Bank’s selected branches. Gold is imported from the refiner giant, M/s PAMP SA, Switzerland M/s PAMP SA, Switzerland is one of the leading refiners in the world The bullion comes in varied denominations (1gm, 2gm, 5gm, 8gm, 20gm, 50gm & 100gm) in tamper proof certicard with Assay Certification which authenticates the purity.
WHY PERFORMANCE APPRAISAL FAILS?
1. Lack of integration
Performance management has to be approached from an integrated perspective. Synergy has to be created between the performance management system and strategic planning, human resource management processes, organisational culture, structure and all other major organisational systems and processes. Individual, team and organisational strategic objectives must be harmonised. Without integration, no performance management system can succeed on its own, no matter how good the performance management system may be.
2. Design challenges
The performance management system and tools must be designed to address the particular needs of organizations. The design process should involve thorough consultation with major stakeholders and especially with future users of the system. Consultation and interaction are necessary to build trust and relationships with employees and relevant stakeholders. Trust is an absolute requirement for the success of the performance management system. The new performance management system should be piloted and thoroughly tested before it is applied in the organization. Applying an incomplete system leads to loss of credibility, time, financial and human resources, and increases resistance to change and low acceptance of the new performance management system.