Assessing the Impact of HRM Systems on Westpac

1. Introduction

This report is developed to assess the HRM systems used and how this is leaving an impact on the selected organization Westpac. This organization is into corporate banking and here the gaps in the literature are assessed that address strategic HRM concepts. The purpose of this report is to use academic references and assess the business development perceptions associated with HRM systems within an organization. Providing recommendations on policy implications of HRM is also done here. For students who are seeking valuable insights into HRM dissertation help, this report can serve as the most valuable resource.

This organization Westpac is associated with the personal, business, and corporate banking system. The organization's setbacks within a supportive measure of rebuilding the finances and helps people to find out ways of home equity. The bank made 2,065 crores AUD in 2019 and was established in the year 1817. Stock prices can be identified as WBC (ASX) A$26.20 (Westpac.com.au, 2021). Managing everyday business banking has become easier with this bank as they follow a mission of understanding customer needs and "putting more feet on the street". They expect to build long-term relationships with customers through online and offline banking. This organization comes with an employee base of 40000 people and it has to incorporate the largest HRM values (Westpac.com.au, 2021).

This report has a scope of highlighting external and internal influence along with contributions to understand the best practices of HRM and strategic development. Highlighting the effectiveness of this department along with identifying current issues are done in this context.

Some recommendations are provided for the organization to follow in the furniture so that its HRM system will become improved (Beyerlein et al. 2019, p.25). Typical policy improvisation and focusing on the functional initiatives developed for people and policy will be done. This report is based on secondary resources.

2. Overview of the Company

2.1 Business development and company perceptions

In this section, a brief introduction to the organization Westpac will be provided. Westpac is identified as a century-old organization that has approximately 26.20 AUD of share prices (Westpac.com.au, 2021). It is one of the largest banks of Australia, headquartered in Sydney. The bank operates in the largest areas of personal and corporate banking (Bailey et al. 2018, p. 179). The bank is currently serving 12 million people. The business covers Sydney, Melbourne, New South Wales, and some cities of Australia as a part of customer service. It follows sustainable business practices as it takes serious responsibility to meet the ethical standards of banking (Garavan, McCarthy, and Carbery, 2019, p. 248). This organization also follows the agile work system inside banking and generates maximum profit through serving customers throughout their needs. New banking process adaptation includes:

• 24/7 self-service lobbies
• iPads
• Digital marketing
• Video conferencing
• WiFi
• Transaction cash recyclers (Jiang, and Messersmith, 2018, p.6)
• Different start and finish times for employees
• Working part-time for employees

Every position is flexible and this bank is almost changing the concepts of desk-based jobs in banks.

2.2 Mission and vision statement

Westpac follows a vision statement of becoming “one of the world's great service companies, helping our customers, communities, and people to prosper and grow.” They have also found their ways through the strategy statement as “Our strategy seeks to deliver on this purpose by building deep and enduring customer relationships, being a leader in the community”.

2.3 Discussion on strategic improvement

This organization essentially uses strategic alignment within its business. They have prioritized their essentials of business performance through improving work experience (Madanat, and Khasawneh, 2018, p. 18). Addressing of shortcomings is done in this case such as:

• Risk management in terms of cultural, and IT complexity
• Reduction of customer pain points and remediation
• Non-core business closure and consolidating in an international location
• Digital data is used for transformation and rationalizing products
• Market-leading customer service along with mortgage growth (Alfes et al. 2019, p.239)
• Managing strong balance sheets and optimizing capitals are seen
• Employee management and business model operations are implemented

3. Cultural overview of the organization

3.1 Insights of the cultural aspect of the organization

People and cultural development of an organization lead to the success factors of a business’s operating environment (Gubbins et al. 2018, p.193). “In delivering on our strategy, we are focused on our core markets of Australia and New Zealand, where we provide a comprehensive range of financial products and services that assist us in meeting the financial services needs of customers." This is the core concept of this culturally diverse organization.

3.2 Analysis of the organizational structure

Starting from CEO there are important parts of the organization observed which includes group head of retail and business banking. There are group executives who are identified to be working in these institutional banks. People side chief executive is often seen to be managing the competency factors (Otoo, 2019, Topic 5). There are transformation officers seen that work in an environment of business banking and help this organization grow. Westpac provides specialist services at a corporate level that indulges in major trading or banking in different locations.

Group executive of product and operations

Group chief transfromation officer

Chief financial officer

Chief risk officer

Group executive Technilogy

Group executive peopel

Chief executive of Westpac New zealand

Chief executive of financial group

Group executive of Westpac instituitional bank

4. Analysis of HRM system

4.1 Description of existing HR system

In the current system, this organization provides a variety of working flexibilities for employees. There are the different start and finish times observed along with facilities provided for Working away from the office and in their home. There is job-sharing observed along with working part-time inside this bank (Bakker, and Leiter, 2017, p.70). Compressed working weeks are associated with sustainable human resource management inside this organization. Flexi leave options are given to employees to generate maximum benefits. There are 12 weeks of flexible lifestyle leave offered to the employees. Paid leave for wellbeing and 10 days of domestic violence support leave. Paid parental leave up to 13 weeks are seen along with 3 days of retirement support leave for managing this entire process (Westpac.com.au, 2021). Great motivation is provided to the workers so that they can proceed with workloads on flexible timings. Westpac is recognized as an ABA100 winner for human resource management in the Australian business for aggressive customer development.

4.1.1 Review of HRM strategy

Westpac has several work areas to be focused on for future management of employees. Cultural development potentially undergoes the sustainable choice made and policies undertaken by Westpac. Mobilizing and leveraging the human capital for the management of organizational growth is important. Growth aspirations are found to be quite agile for this organization. HRM strategy will be reviewed in terms of the current method of developing the strategy and issues within this organization (Yip, and Bocken, 2018, p.160). The reason behind introducing an aggressive customer-training program was to deal with the emotional well-being of employees and reduce the emotional cost to employees. Without human resource sustainability, the bank is of no use.

They are conducting assessments on work and life balance for management of employee’s mental health and overall performance of the organization. With an age balance strategy, continuation to the retention of existing employees and their intention towards retirement is assessed. Employee satisfaction is provided through the identification of communication improvement processes. This organization has also employed an employee ombudsman that resolves issues not identified through an internal grievance process (Papa et al. 2018, Topic 2). Performance management and the remuneration process are identified as important aspects of assessment. They also focus on employee commitment issues and favorable salary improvisation is done in this organization. Some cultural issues are required to be overcome as women are less seen in management less often. Women also handle executive management aspects. The entire process is managed to create effective strategies.

Issues with HRM in Westpac:

Team building capacities are quite less

Improving the quality of output from employees is not done and less focus on an employee engagement program (O’riordan, 2017, p.20)

Customer outrages and maltreatment towards the employees are not focused

Operations like a credit card, insurance, and loan processing require training for staff, which is not focused

Newly appointed managers face challenges regarding work description and condition of CBA as there is a lack of induction

4.1.2 Environmental SWOT

Westpac banking group has presented its benchmark in the business and performance aspects as compared to other banks in the industry. Internal and external analysis is focused here. The internal analysis consists of strength and weakness analysis. A practical tool for analysis is SHRM application that involved SWOT (Deakin University, 2009, Topic 5, p.6)

Strengths of this company:

Strategic positioning, as well as financial positioning, is well managed

Leads the way of operations ahead of other Australian institutional banks

Second largest business banking sector with extraordinary customer support (Westpac.com.au, 2021)

Proceeds operation with more than 40000 employees and serves more than 12 million customers

Financial assistance provided to individual and institutional clients along with satisfying customers total banking needs

Strong employment rules supported by an ability to attract and retain key people to the organization (DiRomualdo, El-Khoury, and Girimonte, 2018, p.15)

Flexible HRM compositions and employee reward systems are designed

Women empowerment is focused on the recruitment of female employees in a managerial position

Improved internal work culture and performance

Weakness of this company:

Lack of profit outside their core business in an international platform

Centralized control struggle and leadership dilemma is sometimes hampering efficiency and morale of employees (Singh et al. 2020)

High competition is observed in retail banking with leading banks

Branch numbers identified to be less as compared to other banks

Low employee engagement can cause customer dissatisfaction

External environment analysis can be conducted in terms of opportunities and threats and opportunities are:

Technological changes across the banking sector create better positioning and development aspects

Operations in emerging economies can leverage the growth

The high technological focus is helping new banking product development

Licensing process is done for opening banks in other countries and this helps in market development and global expansion

Some threats are identified as:

A lowered economical balance of Australia and New Zealand is having a significant effect on the bank (Kryscynski et al. 2018, p.715)

Credit limit and regulatory changes leave an impact on the bank

Competition in the international market has raised as the interest rates are fluctuating

4.1.3 Gap analysis of strategic HRM platform

The current system that is applied inside Westpac is a technology-driven HRM system. Contemporary features (Cited in Deakin University, 2009, Topic 2, p. 9-11) that related to the development of effective HRM practices refer to the core features such as:

Close monitoring of customers needs and associating them in their development process

Continuous improvement in quality of service, employee performance, and products for individual and institutional level (Yong et al. 2020, p.212)

Utilizing technology for strategic advantage in banking

Reduction in differences of the status of employees and creating a communication channel between hierarchies

Self-managed teams for looking after customer needs and one another

4.2 Literature review of HR systems

HRM is associated with business development as employee performance directly links with business profit. HR practices are associated with finding the best fit for a particular job and planning to achieve optimum sales (Kianto, Sáenz, and Aramburu, 2017, p.15). Forecasting demand for recruitment and keeping centralized management is important in HRM. The process review of Westpac can be explained in terms of the following concepts.

4.2.1 Development of HSE and fair working systems with a fair pay commitment

There should be no discrimination done while it comes to fair pay. Although the organization already ensures that a fair pay act is enabled inside the organization, there should not be any policies aligned in the future that hinders this system. The pay scale should be based on talent and capability of handling assigned jobs (Esteban-Sanchez, de la Cuesta-Gonzalez, and Paredes-Gazquez, 2017, p.1000). The workplace health and safety model has become more significant post-pandemic. Following the sanitization rules and continuing management of employees, safety procedures are important. In addition to this, it has become important to organize. HSE initiative taken for business management and there are certain policies included such as:

Protecting people through the elimination of practicable along with physical health and safety risks (Westpac.com.au, 2021)

Prevention of harm from mental health issues in employees and management of risks

Creating meeting with HSE for the development of appropriate strategies for overall health support providing

Gathering feedback on services from employees

4.2.2 Remuneration of work and acknowledgment of efforts

Westpac Banking is associated with internal standards of acknowledging people's effort in work through providing them adequate remuneration and rewards. There should not be any gender bias seen while giving a hike in salary for employees (Muhammad, 2018, p.4). High base salaries and taking smaller initiatives towards improving employee’s motivation is identified to be a great approach. Restructuring the salary structure and benefits are associated with performance management. Some steps are as follows:

Employee share programs are open to all while they collaborate and learn new technologies (Bell, Brown, and Weiss, 2018, p.2018)

Gaining lessons from senior managers on the selling of banking products and associating the customers with appropriate support is important

Two major qualification program such as best banker national program, tier 2 accreditation online training is impressive for employee management

A performance-based incentive system is applied in the last financial year for creating sensitivity of improved performance

Identifying one of the best talents inside an organization along with rewarding the individuals is key towards the improvement of performances (Singh et al. 2020, p.150). For example, high-performance culture might be obtained via giving the lower level employees and customer service desk employees a hike and appropriate training for the job. Monitoring performance after a fair hike is seen in this company.

4.2.3 Dynamic organizational structure creation

The creation of dynamic teamwork culture that can accept the changes heartily is important. Employees often object to a change in leadership and employment policies. Now, ensuring that the employees understand resource flexibility and coordination of work policies is important. Appropriate communication should be managed with employees to conduct the changes (Collings et al. 2021, Topic 1). Therefore, employees will feel easy to accept the changes and grab the development opportunities. This organization Westpac has designed a specialized team of employee ombudsman that resolves issues not identified through an internal grievance process. Resource flexibility and providing them the facilities of remote working is a major challenge for this organization as business units are impacted.

4.2.4 Identification of impressive employee talent and providing a learning environment

Learning and skill development programs are giving the employees the best possible experience of learning. It is important to facilitate improved technical systems for giving employees a platform for learning (Chapman et al. 2018, p.533). Career development strategies for employees were undertaken in 2006. Inclusion and diversity of career development at personal levels help in the management of growth strategies.

Identification of resources that might cause risk to the organization and providing them sustainable incentives for the execution of personal development plan is expected to provide sustainability (Baik, Kim, and Patel, 2019, p.405)

Leadership competency and framework identification can be useful for this organization Westpac

Rethinking micro-management policies as employees might not support being monitored 24*7

4.2.5 Technical integrity improvement and operational development

Operation excellence is strategically associated with the business performance to be delivered inside a banking organization. As systems are upgrading to online, the employees need to train to process customer requests online. There are improved processes such as chatbots that can be applied to each of the systems for the generation of perfect support online (Thoman, and Lloyd, 2018, p.150). Employees are required to abide by the HRM concepts and they are bound to keep customer data safe. A leading bank Capital One was once accused of massive data breach and leaking customer information to the dark web. This incident took place in March 2019. Such incidents leave a bad impression on customers as they are damaged most. In this data breach, internal employee engagement was suspected (Han et al. 2019). Hence, Westpac needs to take measures so that guidelines settled on data protection by HIPAA are maintained. Limitation of employee access to confidential data can help prevent any such data breach and maintain brand image. Westpac itself faced the leakage of customer data through external payments platforms. Attracting talented employees across the world by giving good salary packages and customizable work schedules are identified as a great HRM strategy. Westpac might proceed towards this strategy and provide the employees with appropriate technology training for handling customer data is an impressive idea.

4.2.6 High-performance culture development

High-performance cultures can be integrated within the handling of customers and relative management of performance scopes. Engaging in better roles of employees through qualitative assessments is refreshing the talent management and providing a succession planning process. There are integrated processes observed in Westpac for the management of HRM and enforce consistent systems (Korzynski, Mazurek, and Haenlein, 2020, p.205). For example:

Measures can be taken for improvement of candidate screening and security for fraud detection

Mapping and validating client’s development programs to ensure competency units

Creation of online learning content regarding any HR related issues such as leaves, salary, and sexual abuse in the workplace (Li et al. 2018, p.2001)

Any discrepancy observed in the internal process of the bank must be reported to grievance support by employees

4.3 Alternatives to the current systems

Alternatives can be aligned in terms of the SAP-based HRM system integration. These small technological additions are expected to provide adequate success factors of human resource management. This is expected to provide ease of access to the HR and core payroll. Talent management along with employee experience management and people analytics will be easier to access (Ghosh et al. 2019, p.40). Leveraging the SAP is controlled under the progress of embedded intelligent technology competency and leads toward employee’s engagement and productivity. Moreover, the system is expected to ensure higher sales and profitability.

4.4 Best practice alignment in the industry

There are several arguments identified regarding the best practices of the industry. Some of them are:

Being transparent as per the product and services offered. This process also aligns with a development training program for employees to manage customer expectation in business

Prompt response culture is well maintained (Davis, and Simpson, 2017, p.20)

Development of culture that ensures taking ownership of action

Managing risks by calling board meetings and discussions

Moving forward to a technology-driven HR process that includes payroll

4.5 Cultural capability assessments

For successful HR practitioners, reflections upon the specific competition exhibited by the team are assessed. Estimation of companies' cultural aspects is important, as human resource development is associated with overall growth (Analoui, 2017). Celebrating cultural diversity and moral differences along with the employee reward system helps in the growth of the company. The competencies (cited in Deakin University 2009, Topic 9. p.2) are essential in HR attributes. Evaluation and corrective actions are taken on few other available elements such as:

Knowledge of business and 24*7 customer service

Commercial and strategic skills for banking improvement

Leadership skills and change management compatibilities

Business reengineering for online and offline banking progress

5. Recommendation

Modification of current policies and practices

Current policies of payroll should be changed towards the development of fairpay policies. The evaluation should be based entirely on performance, and no biases should be tolerated. Current employee learning programs along with the employee ombudsman program should involve the “fair work act 2009” and “Equal pay act and gender pay act” to some extent can help improve company image (Gürlek, and Uygur, 2021, p.200). Women are given great learning and growth opportunities in this bank though. This ensures the credibility of HRM strategies for this organization by ensuring growth for all. The current use of HRM systems needs to be changed towards a cloud-based model integrated with SAP (Noe et al. 2017). This ensures complete management of services and provides stability to the operating environment. Payroll, grievance and leave request is expected to come under these operating channels and manage the exact levels of competency for an employee. Some advice from a strategic HRM viewpoint is:

A leader needs to manage the knowledgeable aspects for growth and learning for employees and a customer handling program should be developed

Sharing of insights and views with hierarchies might enable decision-making capabilities for employees (Paillé, Valéau, and Renwick, 2020, p.121136)

Benchmarking the performances of employees and taking feedback from internal customers is important for business development

Looking for perceived gaps in the effectiveness of HR and executive team is seen to be supporting the overall growth of employees and mobilizes the best performance areas (Westpac.com.au, 2021)

The recruitment process is managed through conducting formal interviews and online tests. All methods are justified from SHRM perspectives as the implementation of best practices are needed

Talented resources require to be hired with appropriate remuneration and identifying the process of effective change management in business (Li et al. 2021, p. 71)

Higher-level employee restoration as well as hiring a fresh bunch of people for different platforms helps in the development of sustainable pillars

6. Conclusion

The report has explained the strategic development of HRM that leads to business management. Business effectiveness and financial performance management are associated with Westpac. The actual processing of HR policies and managing the integrity has been discussed in this context. Appropriate literature review and gap analysis are conducted by using legitimate references. Westpac is working to employ a robust strategic framework and significant challenges are faced in this implementation process. Recognition of HRM issues is required to be done at first and advanced challenges need to be improvised. Some recommendations are given here that give adequate support to combat strategic HRM challenges.

7. References

Books

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Bailey, C., Mankin, D., Kelliher, C. and Garavan, T., 2018. Strategic human resource management. Oxford University Press.

Noe, R.A., Hollenbeck, J.R., Gerhart, B. and Wright, P.M., 2017. Human resource management: Gaining a competitive advantage. New York, NY: McGraw-Hill Education.

Journals

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Korzynski, P., Mazurek, G. and Haenlein, M., 2020. Leveraging employees as spokespeople in your HR strategy: How company-related employee posts on social media can help firms to attract new talent. European Management Journal, 38(1), pp.204-212.

Kryscynski, D., Reeves, C., Stice‐Lusvardi, R., Ulrich, M. and Russell, G., 2018. Analytical abilities and the performance of HR professionals. Human Resource Management, 57(3), pp.715-738.

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Madanat, H.G. and Khasawneh, A.S., 2018. LEVEL OF EFFECTIVENESS OF HUMAN RESOURCE MANAGEMENT PRACTICES AND ITS IMPACT ON EMPLOYEES'SATISFACTION IN THE BANKING SECTOR OF JORDAN. Journal of Organizational Culture, Communications and Conflict, 22(1), pp.1-19.

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Websites

Westpac.com.au, 2021. Available at: https://www.westpac.com.au/ [Accessed on 01/06/2021]

Westpac.com.au, 2021. Available at: Link [Accessed on 01/06/2021]

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