Human Resource Management Practices at HSBC Bank

Introduction

The purpose of this report is to look at the Human Resource Management principles and approaches and understand them in the context of HSBC bank. The report will look at the practices of recruitment of people and planning and discuss the importance of Human Resource Management (HRM) practices in terms of their benefits and limitations. The report will also look at the practices of employee relations and and its influence on HRM decision making process. Lastly, the report will look at the elements of employee legislation and elucidate on a few HRM practices which will be justified with rationales.

SECTION 1

2. About the Organisation

HSBC is one of the largest banks in the world and they serve over 40 million customers in different countries all over the world (hsbc.co.uk). In the UK, HSBC is the biggest bank in terms of its holdings and market share (corporatefinanceinstitute.com). The company was formed in 1865 and its first offices were opened in Hong Kong. Since then, the company has been operating in various countries. The values on which the company embodies centre around diversity in its professional base, sustainable banking practices and increased connectivity across the globe (hsbc.com).

2.1 Role of Workplace Planning and Human Resource Management

Workplace planning can be understood as resourcing appropriately skilled people for filling professional roles in an organisation. Generally, organisations have a model for the purpose of workplace management, which they rely on when recruiting individuals (financialexpress.com). The importance of workplace planning lies in the fact that it streamlines the process of acquiring talent in an organisation and equips the company to identify the gaps in talents and its associated risks right away (Louch, 2014). Contemporarily, the function of workplace planning has increased manifold because of the changing nature of work in the light of the pandemic (cipd.co.uk).

The practice of strategic HRM (SHRM) is a holistic linkage between the company’s present capabilities and the gap which exists in delivering the objectives of the organisation, and SHRM is a set of practices which help in delivering those (medium.com). Essentially, its importance lies in recognising the strategic importance of the company’s human resources and the second relies on mapping out HRM practices in order to realise and improve the human resources (Gilani et al, 2012).

In HSBC, the approach to SHRM has undergone a change due to the present challenges whereby 70% of their workers have been working from home. To enable workers in order to do that effectively, they have launched the Future Skills program and made putting the consumer at the centre of the company’s priorities. (shrm.org).

2.2 Strengths and Weaknesses of Approaches to Recruitment and Selection

There are several approached to recruitment and selection of candidates in a company. Attracting right candidates through job advertisements and rewards is a good way of attracting employees (brighthr.com). However, an issue with that it advertisements get very little attention from the top players in the market (Corlett, 2014).

Other approaches to recruitment may include designing strategic applications, using social media to communicate with prospective employees, avoiding bias by removing identity-based background from the candidates’s profile, using proficiency tests to choose the most qualified candidate and making an official offer which profits both the organisation and candidate (brighthr.com).

SECTION 2

2. Benefits and Implications of Human Resource Management Practices

influence the behaviour, performance, and attitudes of employees (De Cieri et al., 2008). In simple words, it is basically an attempt to optimise performance of employees individually and as a group. In this article, two components of human resource management are described in brief, and their benefits and limitations are discussed.

management processes has an important role to play in increasing employees’ productivity and amplifying organizational performance (Uzee, 1999). Stallworth and Kleiner (1996) argue that not only does an organisations physical layout increase the physical comfort and wellness of employees which leads to better productivity as well as boosting the work satisfaction of the employees and reducing attrition rates, but also it is a major determinant in attracting the best employees. Attracting the best talent to the organisations is one of the first steps of the recruitment process, and having a workplace which is to the comfort and satisfaction of prospective employees and representative of the company values helps in that process and can potentially be a significant benefit to the company.

Other benefits to the company include lowering attrition rates due to better employee job satisfaction. A distinct example of this is a study by Gensler (2006) where he demonstrated that UK business managers reported a staggering degree of increase in the productivity of employees, almost 20% to be specific, upon making improvements in the design of the workplace. Thus it can be concluded that a good workplace design in term of ergonomic design and physical parameters like daylight, space, ventilation, recreation facilities are associated with employee performances, and the same could also be applied in the context of HSBC bank to increase employee productivity, attract the best talent and reduce attrition rates. There are however, certain limitations to designing or redesigning workplaces.

Very often what constitutes good workplace design is subjective, and that poses a barrier to construct a workplace suitable for all. There can also be a substantial cost to redesigning office spaces, and often ergonomic designs are not feasible if the office space is small and limited.

Job design can be understood as the process of outlining the task, duties, responsibilities,

qualifications, methods and relationships required to perform the given set of a job (Foss et. al., 2009). There are various strategies adopted in modern human resource management practices which enhances employee performance and reduces overall cost to the company. The first strategy is to provide employees with autonomy, which involves giving the employee the opportunity to decide when and how to carry out tasks. The advantage of that is it fosters innovation but it might potentially be harder for large organisations like HSBC to co-ordinate between different departments (Parker et. al., 1997).

Other strategies like providing employees with task identity, which means to giving employees the opportunity to complete a task from the beginning to end has been shown to increase motivation, and consequently raises productivity (Gagné & Deci, 2005). However, it reduces redundancy measures if the employees are unable to complete the work.

Performance Management

Performance management can be understood as an ongoing and constant process of communication between a supervisor providing feedback following which employee performance is reviewed, and rewards or benefits are provided (Latham, et.al 2009 ; Mayhew, 2021). There are several benefits a robust performance management system, especially in a big organisation like HSBC bank. Studies have demonstrated that performance management systems increase motivation levels, because employees will recognise that the organisation recognises and rewards good performance, therefore the

employee will be encouraged to perform better (Saifalislam et. al., 2014). The higher morale and the motivation should also reduce attrition rates. The other benefit to a robust performance management system is to identify employees who need additional training early, and also identify the specific training required, both of which reduces the training costs to the company.

There are, however, certain challenges and limitations that performance management can face. In organisations with a lot of internal competition, those who do not get recognised or rewarded may get disgruntled with the system (Peacock et.al. 2020). Also, a lack of clear communications regarding expectations from employees will lead to higher employee dissatisfaction.

2.2 Relevance of HRM in Efficiency, Effectiveness and Probability

The ideal of developing Human Resource Management in an organisation is important as it boosts the morale of workers and equips the workers to work in difficult and challenging situations. This is an especially pertinent issue in the contemporary situations as workers worldwide are facing a loss in morale, as it is becoming increasingly difficult to work in teams (Davies, 2020).

The ideal of HRM is commonly understood as an ‘invisible asset’ currently, which is responsible for creating an organisational operation which enhances the assets of the company (Itami and Roehl, 1991). HRM allows for the employees to feel that they are a greater asset to the particular organisation than they felt and hence it allows them to put in greater effort in terms of maintaining the quality of their work and team efforts (Li, 2014). Another important reason why HRM is important is because of its team-building capabilities. While an individual worker may feel that they are working in isolation and they do not need group management, the initiative of boosting the confidence and skill of the worker stems from the Human Resources. They are supposed to foster a sense of altruism and responsibility in the individual worked, so that they feel like they are the citizens of the company and not just paid workers (Zhang, 2016).

There are some pertinent issues with HRM strategies, it has been postulated that excessive systems of reliance between departments may cause certain issues of excessive interdependence, which may make it difficult for the departments to function together (Becker and Gerhert, 1996).

SECTION 3

Employee Relations and HRM Decision Making

In simple terms, employee relations consists of the relations between employees in a professional space. With the years, the term has begun to progress into new terms which now consist of employee’s relationship with their own individual selves as well as with their other colleagues. This comes at the time when employee relations are at a decline because of the increasing individualisation of work, whereby individuals are becoming more and more isolated in their professional environment and the decline of the Trade Union is also a factor contributing to this phenomenon (cipd.co.uk).

What is important to realise about employee relations is that it should be approached from the perspective of understanding employees not just as faceless workers, but as human beings. An important issue which is commonly faced by employees is the lack of ability to climb the professional hierarchy, and feelings of being trapped in their present roles. Another important issue that reiterates the importance of employee relations is the fact that employees need to have feelings of loyalty with the organisation they are working with and the people who are their superiors. The contemporary practice encourages employees to broaden the horizon of their professional experience and concentrate on being creative instead of merely being dutiful (Craig, 2017).

The role of the HRM is to develop cross-functional relationships and encourage social interactions between employees. Additionally, Human Resources can conduct team building exercises between colleagues in a professional space and encourage them to communicate more effectively by providing them with tools like social events, in which they will be able to communicate informally (blog.vantagecircle.com).

3.1 Key Elements of Employee Legislation

Employment legislation is inclusive of any kind of law pertaining to a worker and their relationship with their profession and could range from legislation related to their rights, pay, their working conditions or the socio-cultural environment they are working in bbc.co.uk). In the UK, one of the most important employment laws that was passes was the Equality Act which was passed in 2010. According to the Act, there are several things which an individual couldn’t be discriminated against in the workplace. The act protects against discrimination on the basis of sex and/or gender, keeping payment secret, protection to various beliefs and organisations within the professional space related to religion and/or other beliefs and the recommendations by tribunals to increase equality in the workplace (www.gov.uk).

Another legislation which is of relevance in the professional space in the UK is the Data Protection Act which was passed in 2018. The law elucidates that the information that is possessed by companies need to be used responsibly and carefully and should keep getting updated if it is being kept in storage. Additionally, the act elucidates that companies need to be more responsible in storing certain kinds of information like the race and sexual preferences of consumers and religious beliefs. The company storing your data has the responsibility to inform the customer at all times how their data is being used and it needs to be used transparently (www.gov.uk).

3.2 Application of an HRM Practice and Rationale

Demirkaya et al (2011) elucidate on the process of application of HRM practices in the workplaces. These practices consist of innovation, which mainly consists of the organisation creating new ideas and also taking hints from the market about profitable areas to develop in. Innovation is an important aspect in a company as it signifies relevance, and it is possibly more important than quality. Research has positively shown a correlation between the innovative practices in an organisation and innovation in its internal human resources (Chen and Huang, 2009). The rationale behind the application of innovation is because the market is saturated with new products frequently, it is important for the business to innovate rapidly in order to stay relevant (Demirkaya et al, 2011).

Dig deeper into Human Resource Management with our selection of articles.

References

Corporate Finance Institute. 2021. Top Banks in the UK - Overview and Guide to Top 10 UK Banks. [online] Available at: [Accessed 1 April 2021].

About.hsbc.co.uk. 2021. About HSBC | HSBC in the UK. [online] Available at: [Accessed 1 April 2021].

Who we are Skip to Insight Who we are Founded in 1865, v., Investors Skip to News and media Investors Find information about our performance, a. and News and media Skip to Careers News and media Find the latest media releases, s., 2021. Our values | HSBC Holdings plc. [online] HSBC. Available at: [Accessed 1 April 2021].

Peter Louch, V. and Peter Louch, V., 2021. Workforce Planning Is Essential to High-Performing Organizations. [online] SHRM. Available at: [Accessed 1 April 2021].

CIPD. 2021. Workforce Planning | Factsheets | CIPD. [online] Available at: [Accessed 1 April 2021].

Medium. 2021. What is Strategic Human Resource management (SHRM)?. [online] Available at: [Accessed 1 April 2021].

Gilani, M.H.N., Zadeh, M.S. and Saderi, H.R., 2012. The role of strategic human resource management in creation of competitive advantages (case study: a commercial organization in Malaysia). International Journal of Business and Social Science, 3(16).

SHRM. 2021. Workforce Management RESET: Strategies & Implications for Changing Times 2020. [online] Available at: [Accessed 1 April 2021].

Corlett, B., 2021. What's the Real Problem with Job Advertising?. [online] Blog.staffingadvisors.com. Available at: [Accessed 1 April 2021].

Brighthr.com. 2021. Best HR Approaches to Recruitment. [online] Available at: [Accessed 1 April 2021].

Davies, N., 2021. Remote Team Morale Is About To Plummet, Here’s What Leaders Must Do. [online] Forbes. Available at: [Accessed 1 April 2021].

Zhang, L., 2016. The impact of human resource management on organizational effectiveness. Chemical Engineering Transactions, 51, pp.895-900.

Becker, B. and Gerhart, B., 1996. The impact of human resource management on organizational performance: Progress and prospects. Academy of management journal, 39(4), pp.779-801.

Itami, H. and Roehl, T.W., 1991. Mobilizing invisible assets. Harvard University Press.

Li, H., 2014. The development of a human resource management system. In Advanced Materials Research (Vol. 926, pp. 4020-4023). Trans Tech Publications Ltd.

CIPD. 2021. Employee Relations | Factsheets | CIPD. [online] Available at: [Accessed 1 April 2021].

Craig, W., 2021. Why a Strong Employee/Employer Relationship Is Important. [online] Forbes. Available at: [Accessed 1 April 2021].

Blog.vantagecircle.com. 2021. [online] Available at: [Accessed 1 April 2021].

GOV.UK. 2021. Equality Act 2010: guidance. [online] Available at: [Accessed 1 April 2021].

BBC Bitesize. 2021. Employment Law - The impact of legislation on businesses - Eduqas - GCSE Business Revision - Eduqas - BBC Bitesize. [online] Available at: [Accessed 1 April 2021].

GOV.UK. 2021. Data protection. [online] Available at: [Accessed 1 April 2021].

Chen, C.J. and Huang, J.W., 2009. Strategic human resource practices and innovation performance—The mediating role of knowledge management capacity. Journal of business research, 62(1), pp.104-114.

Demirkaya, H., Özcüre, G. and Eryiğit, N., 2011. An application on the impacts of human resource management in technology management of the companies. Procedia-Social and Behavioral Sciences, 24, pp.474-486.

Stewart, E.B., Belcourt, M., Peacock, M., Bohlander, G.W. and Snell, S.A., Essentials of Managing Human Resources, Canadian Edition. Nelson Education.

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