Attracting And Retaining Staff Essay: Issues In Finance Sector
Question
Task: Write attracting and retaining staff essay on the key challenges encountered by staff in finance sector of Australia.
Answer
Talent attraction and retention
The attracting and retaining staff essay brings into light the discussion on the theme or topic of the assignment, ‘Key challenges in the attraction and retention of staff’ in finance sector of Australia. The financial sector is the segment of economy that includes organisations, banks, and other institutions, which provide the financial services to the commercial and retail customers. Finance is the basic function in every organisation as it manages and controls the daily operations of business, and conducts strategic planning activities. The sector is largest contributor to the economy of country, and currently growing at the average rate of 2.9%, assuring the resilience in the last few years. Australia’s finance sector is facing numerous challenges amongst, which retaining workforce is one of the major issues affecting their performance (Reserve bank of Australia, 2019). Retention of staff is one of the critical factors behind the organisational success. Therefore, the attracting and retaining staff essay will highlight the main challenges faced by financial firms for retaining staff in the organisation. The assessment of these challenges will be done using the evidenced material and themes given in the attracting and retaining staff essay. Thus, it will provide an insight about the current scenario of the HRM in Australian financial sector.
Human resource management play an important role in the finance sector, as it provides efficient human resource i.e. staff to manage the financial risks in the firms, such as banks. Moreover, human resource department supports the business in the hiring of talented and experiences candidates, in the ever-changing industry, and training them for higher performance. The finance sector consists of several banks, institutions, insurance companies, real estate agencies, and other firms. The financial system of Australia consists of several aspects such as borrowing and lending funds, transfer of financial claims, and the payment system in the economy. Under this sector, some significant participants are the banks, such as Westpac Australian bank, Commonwealth bank of Australia, and Australia and New Zealand banking group. The analysis may define the challenges in recruiting staff in context to these banks or other financial institutions (Deloitte, 2020).
Now, the attracting and retaining staff essay will get across the HR challenges in finance sector using five themes as given:
The skill gap in the financial sector is continuously widening that is creating a major impact on the effective functioning of the firms, and financial services. This indicates that the management of talent, i.e. attracting and retaining employees has become an important task for the financial managers. Thus, the first theme will focus upon the optimisation of the resources to attract and maintain the best employees in the organisation.
With the change in the functioning of financial system, payment method and other aspects, financial firms are facing complex issues to keep the best expertise within banks, and other firms. This is because of globalisation and technology, which holds the sectoral performance; therefore requires more technology experts to control the payroll systems. Also, they need effective leaders and supervisors to manage teams for attaining set goals and objectives (Xu et al., 2018). They are facing difficulties in shortage of workforce, and reducing costs, because of the decreased demand of the mortgage, and other financial services. These issues mentioned in this attracting and retaining staff essay influence the development of employees and overall growth of the firm. As mentioned earlier, ‘skill-gap’ is one of the critical issues, due to the unavailability of mid-career candidates, developers and data scientists in the financial sector. It has been suggested for the financial organisations to work on their goodwill and reputation in the economy, which may decrease skill gap, and attract qualified talent in the firm (Nankervis et al., 2016).
According to Njabulo Khumalo. (2018), it has been researched on this attracting and retaining staff essay that strategic human resource management plays a vital role in the attainment of set objectives, and enhances the performance of employees in business organisations. HRM exercise a major influence on the retention of staff in context to loans and savings sector. Recurrent issues of turnover in the financial firms may lead to the increased costs of operations, and further hamper the functioning of workers, and performance. In the attracting and retaining staff essay, the Australian public services or banks such as Westpac bank, and New Zealand banking group has reported the employee turnover rate at 18% which can impact the services. This means the firms need to invest in the implementation of diverse HR activities such as employee relations management, work design, conflict management, strategic planning and others. This section of attracting and retaining staff essay will highlight the key aspects of Strategic HR planning to enhance the job-satisfaction of employees working in the organisation (Ai Group, 2018).
Australian public banks need to emphasize on the strategic planning or workforce planning to overcome the HR challenges and meet the changing needs. HR planning or workforce planning is the systematic process that assist in analysing the current and future requirements of employees to attain their organisational goals. This is due to the fact that Australian public sector has been constantly facing problem because of poor planning and lack of employee capacity in the organisations. The authors mentioned retention factors in the financial firms, such as remuneration and benefits, training opportunities, working conditions, fair and equal treatment, and organisational culture, contributing to the employee retention in firms. Monetary pay and performance related pay are considered as the facilitators of retention of staff in the financial sector companies. A high paying financial firm such as banks reduces employee turnover and increases their commitment towards managing tasks and handling duties in organisation (Noe & Kodwani, 2018).
Westpac bank and other significant firms in Australia will implement the planning model to bridge the gap or difference between the current human resource and future requirements to attain their financial objectives. The authors in their research also listed ‘work-life balance’ which tends to affect the employees decisions to stay in the organisation for a longer period. In banking sector, the costs of developing, training and maintaining workforce is high and complex job, as it employs capital and resources. Hence, these issues outlined in this attracting and retaining staff essay will be resolved through the implementation of effective planning in the organisation; thereby retaining employees (KPMG, 2020).
Australian financial firms, banks, insurance companies and other firms face challenge of retaining expertise in the organisation, due to the work-conditions or work environment, which mostly influences their sustainability and performance. In Australia, every financial firm utilises different approaches towards designing their jobs for the improvement in performance of employees. It makes clear that job redesign and employee performance are correlated and supports the finance managers to attain their goals. Therefore, this section of attracting and retaining staff essay will discuss the work design challenges in a changing environment in finance sector (Nankervis et al., 2016).
As per the study conducted by Giorgi et al. (2017), it has been found that changes in the global economy and deregulated markets has led to numerous changes in the delivery of financial services to the retail customers. Deregulation of the labor markets, upgradation of technology, and new emerging job roles have been reconstructing the working lives of workers in the financial industry. The impact on workers, is not just limited to their organisational performance and growth, also it impact their health and wellbeing. An issue of ineffective communication or interaction between senior management and staff in the banks has been found (private and public), which also led to employee turnover (Otoo, 2019).
Job design within financial sector is defined as the specification of the content, work methods and relationships of jobs, which satisfies the technological, organisational and personal requirements, of the job. The international Labor organisation has reported the complex issues of work for the staff in financial firms, which included problems with ergonomics, conflicting roles, work demands from customers, ineffective relationships with superiors, and others. Job positions were also reduced which intensified the volume of work pressure on the existing ones; thereby creating a negative work environment (Alaa Soliman & Mukhtar Adam, 2017).
Thusly, managers are responsible in financial firms to focus on the redesigning of jobs for improving employee satisfaction. Banks and other financial institutions can assure high revenues with development of their services; therefore increasing the attractiveness of job for the employees. Several factors increase the value of job such as pay, work-life balance, flexibility in work hours, support from team, ethical leadership, job-security, recognition at workplace and organisational culture. These factors make the job more competitive amongst other firms, and retain staff in the organisation in long term. Thus, it can be stated that redesigning jobs enhances the staff performance and reduces employee turnover in the organisations (Giorgi et al., 2017).
From the research on attracting and retaining staff essay it has been found that financial service organisations select qualified staff from different regions for employing the best talent to assist in organisational goals. This indicates the requirement of effective HRM practices in the organisation. In banking industry, and other financial departments employees are selected through the telephonic interview and face-to-face interviews, and the skill test for matching the need of adaptability to the technology. Thus, the current/effective HR practices of hiring staff in the banks, and other firms are done through a series of steps which determines the suitability of the person for the job. Moreover, the selection of employees is done using both, i.e. the internal and external sources as per the requirement. Furthermore, to state the criteria of selecting employees for the entry-level job in banks, it requires some basic aspects. The individual must be a graduate in the selected stream or field between 21-30 years, and should possess the significant technical and professional skills to handle the job (Rahmawati, 2018).
Now, the attracting and retaining staff essay will discuss the theme of talent retention and development in the financial sector of Australia.
According to Shahid et al. (2017) stated the significance of employee retention is vital to the success of the financial firms in the longer period. Retaining employees requires the managers and leaders to possess some specific qualities and skills to motivate the employees towards working for achieving goals in the organisation. As discussed in the earlier section of attracting and retaining staff essay, it is understood that employee motivation is contingent on the work environment mainly, and development opportunities in the organisation.
The author has also emphasized on the workplace diversity management, in the financial sector for a higher growth in the economy. Firms has opted this strategy of ensuring diversity in their workforce, to compete with their rivals, and enhance their performance. There are numerous advantages of a diversified workforce, i.e. increased customer loyalty, employee satisfaction, positive work environment, and also attracting and developing staff in the organisation. As losing talented and skilled expertise is a major damage to the organisation’s productivity. Talent/employee development is a key factor in the retention of employees in the financial sector. This included several activities undertaken by managers by mentoring, and supervisors for employee personal growth (Hafeez et al., 2019).
Imparting training to the employees is directly related to the organisational commitment, and employee turnover. Additionally, supervisors and branch head managers also work for making arrangements for their learning while working in the organisation. They provide guidance and mentoring to the employees for their growth and development in the future (Nankervis et al., 2016). It indicates about the use of induction programmes in the organisation will drive long-term benefits of employee retention, enhanced productivity, and increased sense of recognition with the organisation. This eventually benefits the customers, retains the staff and thus, increases the overall growth of the organisation (Mohammed, Gururajan & Hafeez-Baig, 2017).
Progressing, the attracting and retaining staff essay will discuss the significance of performance management in the financial organisations of Australia.
The concept of performance management means the analysis of the employee’s performance with the predetermined goals and objectives of the organisation. The challenges of performance management are constantly reported in the banking and finance sector. This sector focuses especially on the holistic nature of the technology enabled performance, which aims to improve the performance of employees in the firm.
As per the study conducted by O’Neill, Sohal & Teng (2016), it has been found that organisational performance has become a major issue in the small scale and large scale firms. Furthermore, it has been found that the banking loans in the Australia have majorly invested in the housing sector, which hampers the growth of other sectors in the economy. Also, the companies considered their employees and premises as the sources of inefficiency in the organisation (Shahid et al., 2017).
In the financial firms, and banks operating in Australia, it has been reported that managers are criticised for their inability to identify the valuable impact of quality and innovation in the performance management. As innovation in the use of technology for providing services to the customers is one major change that is needed to be done in the organisations for improving performance. The scenario has been changed now, due to the invention of technologies, and other HR processes, and this has influenced various stakeholders in the business; leaders and managers in different ways (Behravesh, Tanova & Abubakar, 2019).
As studied in the previous section of this attracting and retaining staff essay, the financial firms focused on four major categories of systems and practices implemented by the top management for attaining higher performance. These included strategic planning, measurement and compensation, organisation structure and management procedures and HR & organisational value. Banks must switch to the efficient performance management systems (PMS) like MBO, 360-degree feedback and others. Thus, the financial organisations implementing effective PMS will attain higher performance in organisation, and retaining employees for longer period (Hassan, 2016).
In the last section, the attracting and retaining staff essay will discuss the relationship between strategic reward management and employee performance in the organisations. The term reward management is described as the development and effective implementation of strategies, and policies which aim at ensuring fair, consistent and equal reward to staff. With reference to the study conducted by Taba, M. (2018), it has been found that reward system and employee work satisfaction are significantly related to each other in financial sector.
Rewards and employee performance are correlated to each other, as rewards given to employees increases their motivation and job-satisfaction in the organisation. These are the positive results earned through an employee’s performance, and they can be extrinsic and intrinsic rewards, financial, or performance based rewards. Market demands fast, economic, and responsive bank organisations to provide services, and this requires effectiveness in the employee satisfaction and organisational commitment. Moreover, the banking industry is a labor-intensive industry, not a capital-intensive industry. Thus, contribution to employee development along with improvement in their welfare through fair reward system, will lead to enhanced job-satisfaction. One main advantage of reward system is employee participation that increases productivity and improves performance, which motivates them towards receiving rewards from their managers and supervisors. Thusly, employees commits towards attaining financial services in the banks, leading to organisational performance and employee retention in the long-run.
To conclude the above discussion on attracting and retaining staff essay it can be stated that ‘talent attraction and retention’ are the key contributors of growth in finance sector. In Australia, this sector is the strongest contributor of success in the economy. Conversely, the financial firms and Australian banks are currently facing challenges of recruitment and retention of skilled employees. This has been demonstrated in the attracting and retaining staff essay using five themes given. The attracting and retaining staff essay has shown an analysis stating that retention has proved a major change in the efficiency of organisations providing financial services; and increased customer base. In the later part, performance management systems, and rewards are linked to the employee performance in financial firms. Staff development is the factor that compliments their retention for longer period. Hence, it can be detailed that attracting and retaining talent contributes to the growth and sustainability in the finance sector.
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