Business Transformation in Banking Sector Through Employee Engagement in the Competitive Business En

International Journal of Accounting and Financial Management Research (IJAFMR) ISSN (P): 2249–6882; ISSN (E): 2249–7994 Vol. 10, Issue 1, Feb 2020, 17–24 © TJPRC Pvt. Ltd.

BUSINESS TRANSFORMATION IN BANKING SECTOR THROUGH EMPLOYEE ENGAGEMENT IN THE COMPETITIVE BUSINESS ENVIRONMENT - AN INVESTIGATION INTO INFLUENCING FACTORS Dr. M. KAVITHA1, Dr. C. REVATHY2 & MS. V. KUPPULAKSHMI3 1

Assistant Professor & Research Supervisor, PG & Research Department of Commerce, Guru Nanak College, Chennai, India 2

Assistant Professor, PG & Research Department of Commerce, Guru Nanak College, Chennai, India 3

Ph.D. Research Scholar, Guru Nanak College (Autonomous), Chennai, India

ABSTRACT In this present economic world, Employee Engagement has become a highly contributing factor in human resource management. Employee engagement is not only important but has also become a difficult task over recent years. Most of the organizations have given proper place to employee engagement and it is a key variable for competitive advantage and this will improve the organizations performance. Many organizations keep their employees engaged and this will increase their dedication and responsibility in their job. Employee engagement is dependent on various independent

security, personal development, rewards and recognition and work-life balance. Employee engagement in banking sector has great attention because the employees in this sector are relatively very high. The purpose of the study is to find the factors influencing the employee engagement in the banking sector.

KEYWORDS: Employee Engagement, Work Environment, Personal Development, Rewards and Recognition & Banking Sector

Received: Oct 21 2019; Accepted: Nov 11, 2019; Published: Feb 10, 2020; Paper Id.: IJAFMRJUN20203

INTRODUCTION In India, banking sector is the service sector and has rapid growth and expansion. Engaged employees always have creativity, knowledge and innovation and they directly or indirectly create a positive image of their organization.

Organizations look and recruit the people who are really passionate about their work to increase the productivity, higher retention and job satisfaction. Proper coaching, skills, motivation and leadership qualities will encourage employees to engage and do their work effectively to meet the organization goals. An individual performance could be showed when the employees completely engaged with their work. In this business world, employee engagement is pivotal for banks to meet organizational sustainability. Employees interact and highly engaged to serve their customer at their best. The primary focus of engagement of employee efforts increases the team-building programs, non- financial rewards which are closely related to turnover, participation and employee satisfaction.

Review of Literature Kokemuller-2010stated that engaged employees feel involved and motivated in their workplace. There are many internal and external factors which influences the employees’ workplace. The internal factors are job responsibilities, work relationships and growth opportunities. Career opportunities, social obligations are some of

www.tjprc.org

editor@tjprc.org

Original Article

factors. These factors are work environment, culture, leadership, communication, training and development, job

18

Dr. M. Kavitha, Dr. C. Revathy & Ms. V. Kuppulakshmi

the external factors influence the work environment. Hayase L.K.T – 2009stated that internal communication and employee engagement serve as a method in which the variables like coaching, career development, recognition, rewards, accountability be disseminated, supported and communicated whether it is implicit or explicit.Glen-2006 found that, human resource managers should understand and carry out the policies and practices which promotes employee motivation, employee retention, productivity, management, employee work-life balance, compensation and work environment are important for the effective employee engagement in the organization. Vazirani, N-2007 stated that organizations should give equal opportunities for growth and advancement to all the employees which develop their abilities, learn new skill and acquire new knowledge and realize their potential. San et al -2012 found that reward strategy fulfil the requirements of employees and increase their engagement in the organization. Rewards are important element to engaging employees for contributing their best effort to generate new ideas to enhance the organization performance both financially and non-financially.

Objectives •

Studying the dimensions of the employee engagement in the banking sector.

•

The influence of the work environment, personal development, rewards and recognition on Customer loyalty in the banking sector.

An Overview of Employee Engagement in Banks Employee relationship with the company is strong, when employees are genuine and the strategies show a wonderful environment which their employees enjoy working. Employee excellence not only satisfies customers but also increases company performance. Organizations always improve and develop the better relationship with employee and employer.

This motivation encourages the employees to work hard to meet the organizational goals. There are many practices which highly influence the employee engagement.

Work Environment (WE) encourages employees to do many new and better jobs. Relationship between employees and the company lead employees to take on many new challenges and achievements in their workplace.

For-profit companies not only to offer many benefits but also satisfy their employees and strengthen their work environment.

Personal Development(PD) is a life-long event and greatly enhances their skills, knowledge and life habits. Clear view, existing skills, motivation, confidence and satisfaction boost unity. Self- actualisation is the best example of personal development.

Rewards and Recognition (RR) is an event in which a person may value his/her work. Productivity, loyalty, retaining customers depends on a person’s rewards and recognition. Accepting an individuals’ actions requires not only understanding his actions but also remembering them. Monetary rewards, certificates, promotion are some of the examples of recognition.

Customer Loyalty (CL) strategy followed and handled by most of the companies especially banks show a booming relation with their customers.

METHODOLOGY The study conducted through purposive sampling technique and a structured questionnaire was used to collect data from 86 Impact Factor (JCC): 7.1593

NAAS Rating: 3.17

Business Transformation in Banking Sector Through Employee Engagement in the Competitive Business Environment - An Investigation Into Influencing Factors

19

employees from both banks. Questions related to work environment, personal development, rewards & recognition and customer loyalty to meet the objectives of the study.

Analysis and Interpretation The demographic details of the respondents show that the male employees are 57% as against 43% female respondents.

The major part of 64% of respondents are in the age group of 21-40 years and 50 above respondents are only 15%. 54% of employees secured PG and 29% of employees secured UG under educational background. 42% of respondents holding senior level designation and only 21% of respondents holding lower level designation. 33% of respondents earning above 70000 and 21% of the respondents earning 25000-40000 as income. 91% of respondents having a work experience from 11-20 years.

Table 1 Descriptive Statistics Nature of Public sector 43 the bank Private sector 43 Total 86 Gender Male 49 Female 37 Total 86 Age 21-30 29 31-40 26 41-50 18 50 above 13 Total 86 Educational UG 25 background PG 46 Professional 15 Total 86 Designation Senior level 36 Middle level 32 Lower level 18 Total 86 Income 25000-40000 18 40000-55000 25 55000-70000 15 above 70000 28 Total 86 Marital Status Married 31 Unmarried 55 86 Work 11 to 15 40 Experience 16 to 20 38 (in Years) more than 20 8 Total 86

50% 50% 100% 57% 43% 100% 34% 30% 21% 15% 100% 29% 54% 17% 100% 42% 37% 21% 100% 21% 29% 17% 33% 100% 36% 64% 100% 47% 44% 9% 100%

Relationship among various dimensions of Employee Engagement in banks

Customer Loyalty Customer LoyaltyPearson Correlation Sig (2 Tailed) N www.tjprc.org

1

Table 2 Work Environment

Personal Development

Rewards and Recognition

0.589

0.679

0.570

0.000 80

0.000 80

0.000 80 editor@tjprc.org

20

Dr. M. Kavitha, Dr. C. Revathy & Ms. V. Kuppulakshmi

From the above table, we infer the correlation coefficient for the factors of employee engagement. It can be concluded that Customer Loyalty has positive and strong relation with work environment (58.9%), Personal development (67.9%), Rewards and recognition (57.0%).

Multiple Regression Analysis Table 3: Coefficientsa R value

ANOVA sig

Unstandardized Coefficients

.689 .000 B (Constant) 1.109 WE (X1) .844 PD (X2) .618 RR (X3) .156 a. Dependent Variable: CL Note: Denotes significant at 1% level.

Std. Error .109 .153 .886 .142

Standardized Coefficients Beta .651 .977 .027

t

Sig.

4.126 1.622 1.711 .194

.000 .000 .008 .006

The multiple correlation coefficient is 0.689 measures the degree of relationship between the actual values and the predicted values of Customer Loyalty (Y). Because the predicted values are obtained as a linear combination of Work Environment (X1), Personal Development (X2), and Rewards and Recognitions (X3), the coefficient value of 0.689 specifies that the relationship between Customer loyalty (Y) and the three variables is quite strong and positive.

The Coefficient of Determination R-square measures the goodness-of-fit of the estimated Sample Regression Plane (SRP) in terms of the proportion of the variation in the dependent variables explained by the fitted sample regression equation. Thus, the value of R is0.689 simply means that about 68.9% of the variation in adjustment is explained by the estimated SRP that uses Work Environment (X1), Personal Development (X2), and Rewards and Recognitions (X3) as the independent variables and R value is significant at 1 % level.

The multiple regression equation is

Y = 1.109 + .844(X1) + .618 (X2) + .156 (X3) Here the coefficient of X1 is .844 represents the partial effect of Work Environment on Customer loyalty, holding the other variables as constant. The estimated positive sign implies that such effect is positive that Customer loyalty would increase by .844 for every unit increase in Work Environment and this coefficient value is significant at 1% level.

Here the coefficient of X2 is .618 represents the partial effect of Personal Development on Customer loyalty, holding the other variables as constant. The estimated positive sign implies that such effect is positive that Customer loyalty would increase by .618 for every unit increase in Personal Development and this coefficient value is significant at 1% level.

Here, the coefficient of X3 is .156 represents the partial effect of Rewards and Recognitions on Customer loyalty, holding the other variables as constant. The estimated positive sign implies that such effect is positive that Customer loyalty would increase by .156 for every unit increase in Rewards and Recognitions and this coefficient value is significant at 1% level.

The p-value is less than 0.05 at 1% level of significant, therefore, we conclude that the null hypothesis is getting rejected. There is a significant relationship between Employee engagement practices on customer loyalty in banking sector.

Impact Factor (JCC): 7.1593

NAAS Rating: 3.17

Business Transformation in Banking Sector Through Employee Engagement in the Competitive Business Environment - An Investigation Into Influencing Factors

21

Suggestions and Recommendations Managers and Top executives play a key role in fostering employee engagement in many organizations. Formation of employee engagement board, conducting regular training and worker involvement programs move the organization more focused and rise the employee satisfaction level. Establishment of employee engagement forum to realize the strong engagements from employees’ point of view. To strengthen the organization, employees to make a strong attachment with their working teams and co-workers. Work life balance and promotion nurture the employee career and also increase their determination for achievement.

CONCLUSIONS In today’s fast-paced world, retaining employees is a challenging task. Recognition and accountability not only encourage any human being but also gives them satisfaction in their work. So, banking sector employees always adopt quality and effective strategies to meet their goals. Customer loyalty, motivates employees to engage more to understand the customer needs and complete their requirements within the stipulated period. This will ease the organization to keep the higher rate of customers with the help of employee engagement.

REFERENCES 1.

Chaudhuri, A., and Holbrook, M.B.(2001) “The Chain of effects from brand trust and brand affect to brand performance: the role of brand loyalty”, Journal of Marketing, Volume.65, Issue 2, page: 81-93

2.

C. Glen (2006) “Key skills retention and motivation: The war for talent still rages and retention is the high ground”, Industrial and commercial training, Volume. 38 No. 1.

3.

Hayase,(2009) “Internal communication in organizations and employee engagement”, UNLV thesis/dissertations/professional papers/capstones,1176.

4.

Kulkarni, S. (2015). An empirical study of factors responsible for motivating bank employees at lower level: an Indian perspective. Best: International Journal of Management, Information Technology and Engineering (BEST: IJMITE), 3(10), 165-180.

5.

Kokemuller, N(2010) “Internal and External factors affecting employee engagement, Demand media 2010

6.

Walia, S. Effect of job satisfaction factors on employee performance (a study in selected public sector banks in India).

7.

Babu, V. H., Vijayakumar, J., Venkatesh, B. R., & Jothimurugan, T. (2018). Mediation Analysis on Stress Levels of Bank Employees using Sem Approach. International Journal of Research in Humanities, Arts and Literature, 6(8), 305-316.

8.

Oxenstierna, G., Wildmark, M., Finnholm, K., & Elofsson, S., (2008) “A new questionnaire and model for research into the impact of work and the work environment on employee health”, Scandinavian Journal of Work, Environment & Health, 6(6), pp.150-162.

9.

Danish, IqraSaeed, Mehreen, S., Aslam, N., (2014) “Spirit at work and employee engagement in banking sector of Pakistan”, The Journal of Commerce, Vol.VII, No. IV, pp 22-31.

10. Khatoon, N. Integration of information technology with human resource training and its impact on performance.

www.tjprc.org

editor@tjprc.org

22

Dr. M. Kavitha, Dr. C. Revathy & Ms. V. Kuppulakshmi

AUTHOR'S PROFILE

Dr. M. Kavitha, M.Com. MBA, M.Phil, Ph.D. is serving as an Assistant Professor in Guru Nanak College (Autonomous), Chennai and qualified SET in Commerce and SET in Management with 15 years of UG , 11 years of PG Teaching and research experience (Masters and Doctorate Level). Recognized Research Supervisor of University of Madras. Currently 7 candidates are pursuing their Ph.D. under her guidance. Evaluator of academic projects and trainer for FDP. She has experience in providing coaching for Soft skills and Personality development programmes for UG and PG students. She is an Academic counsellor, Project Guide and Evaluator of IGNOU, Board of examiners of University of Madras and other universities and autonomous colleges. Executive Editor of Guru Nanak Journal Multi-Disciplinary Research- special issues. To her credit she published more than 50 articles in reputed journals and conference volume proceedings, participated and presented several papers in many national and international conferences. She has successfully completed the ARPIT course of MHRD. She is a Women-in-charge of commerce department and Department Co- ordinator of IQAC. Organizing committee member of national and international conferences and serving as member in several committees and event organizer of various academic programmes.

Dr. C. Revathyis currently working as an Assistant Professor in PG & Research Department of commerce Guru Nanak College. Having 13 years of experience at UG and PG level. Presented 20 Papers in the Leading Journals. Attended 4 FDP and 5 Workshops at National Level. IGNOU MBA – Academic counselor and Project Guide . GNC M.com project guide & Certificate course Project guide. Coordinator of Banking Certificate course affiliated by University of Madras. GNC Entrepreneurial Development Cell Co-ordinator. Attended FDP in Prime Minister YuvaYojna and Anna University HUB. Conducted the Ed on line course and 40 students have benefited under the scheme. Regularly conducting workshops, seminars, Guest lectures and Ed Fair for the GNC students. Organizing committee member of

GNC – IQAC &

Department of Commerce National seminar and International conference. Member of the Citizen Consumer Club.

Mrs. V. Kuppulakshmi is currently pursuing her Ph.D. in Guru Nanak College (Autonomous) under the guidance of Dr. M. Kavitha, Asst. Prof. of Commerce. She holds Triple Masters Viz., M.Com., MBA (Banking and Finance) and MA Impact Factor (JCC): 7.1593

NAAS Rating: 3.17

Business Transformation in Banking Sector Through Employee Engagement in the Competitive Business Environment - An Investigation Into Influencing Factors

23

(Personnel Management & Industrial Relations) and has completed her M.Phil from PRIST university. She is a Post Graduate Diploma holder in Educational Administration and Supervision. To her credit, she published & presented her research Papers entitled “A Study on Knowledge management and its impact on Corporate sectors”, “A Study on Green Human Resource Management Practices in Hotel Industry” and “An empirical study on Knowledge Creation & Knowledge sharing practices in Automobile Industry”. She attended various workshops relating to research. Participated in many National and International Conferences.

www.tjprc.org

editor@tjprc.org