PAPER ID: IJIFR / V1 / E4 / 040

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1 PAPER ID: IJIFR / V1 / E4 / 040 ISSN (Online): Research Area: commerce, Page No.: Evaluating the effectiveness of training programs in commercial banks for the advancement & Meenakshi PhD Research Scholar Department of Commerce Shri Venkateshwara University, Gajraula Abstract The study of the researcher is about evaluating the effectiveness of training in commercial banks. It is aimed to bring out those innovative and best human resource practices developed and found successful that made banks more competitive in the present competitive banking environment where they want to gain competitive advantage over the rival banks in order to attract and retain the talents. With the kind of reforms and the resulting changes that are currently overawing the Indian banks, the urgency to inculcate such competencies among the workforce is getting intensified in the banking sector. Evaluation of training program would enable organization find out whether or not the training has achieved its purpose, and objectives. The study makes an attempt in exploring and analysing different perceptions of partners of training in the area of Banking. The role of banks is essentially carried out by the people and therefore it is essential to have a well trained and motivated staff to manage the banking operations. All the above-mentioned aspects impressed the researcher to study the existing Training Methods and their effectiveness in selected public and private sector banks and come out with recommendations for future. Key Words: Commercial Banks, Training Programs, Improvement, Effectiveness, Satisfaction, Evaluation, Organization Development, Management Process 1 Introduction In the present day society, the need for well-developed and qualified human resources is being felt very profoundly to successfully face cut-throat competition. This is because the modern commercial and industrial scenario is characterized by mega-sized organizations, global competitions, innovative and newer wide variety of goods and services and ever changing technology. The quest for knowledge for enlightenment is universal, so is change fundamental for the progress of a dynamic society. In the Indian context, to the bankers as partners in the economic development process, every change is a challenge to be met and knowledge provides the strength to convert these challenges into opportunities. But to so do, knowledge needs to be transformed into skills and this is a function of training. Viewed in this context, training becomes an investment in "Knowledge Capital". Evaluation of training can also be done by measuring the impact of a training program on working of the unit or department where the trainees come from. The truth is that every training program should have effect not only on the employees who went for the training but the department or the unit where the trainees come from. The question of the amount of training needs assessment and the effect of training is 101 This paper is available online at - ID: IJIFR/V1/E4/040

2 answered through evaluation process. The purpose of training need assessment is to add value to an organization. Hence, evaluation measures the progress in achieving this goal by purposefully improving training programs and measuring their worth. Finally evaluation of training program can also be done by looking at the impact of the training program on the entire organization. The assumption is that the organization pays for employee training program and the organization should feel the impact or the effect of the training program. Therefore, training program should be evaluated starting from the effects of the training on the employees who participated in the training program to the department or unit they work with and the ultimate effect on the organization. In this scenario, the researcher has become more curious to make a study of the training practices in commercial banks so as to understand the real state of affairs. The study is conducted mainly to find out the Effectiveness of Training in selected public and private sector banks in Ambala city, Haryana. 2 Literature Review Training is one of the most important strategies for organizations to help employees gain proper knowledge and skills needed to meet the challenges in an organizational environment (Rosow and Zager, 1988; and Goldstein and Gilliam, 1990). According to Armstrong (1995) there are a wide variety of training techniques that can be used. These can be divided into: On-the-job techniques, which are practiced on a day-to-day basis or as part of a specially tailored training program. These include job rotation, planned experience and mentoring. Off-the-job techniques, which are used in formal training course away from the place of work. These include lectures, talks, simulation, case study, role playing, workshops etc. The author emphasized that while evaluating training, instead of just studying the reactions of the trainees, the study could be carried out in four different levels viz., i.e., reaction, learning, behaviour and results. The author s guidelines and discussions on each level of evaluation of training are worth mentioning. Fajana (1997) argues that the important thing in choosing training methods is to recognize the nature of the training that will take place and facilitate it. According to him, the biggest problem in training methods lies in the failure to realize the distinction between learning theory and principles, and "how to" in practice.when the people grow to a point where they are ready for responsibilities beyond their initial assignment, training and development becomes imperative. Badhu and Saxena (1999) role of Training in Developing Human Resources is another work of relevance. In this, the authors concluded that an organization should have welldefined training policy as well as training manual and training should be made an ongoing process. However, Goldstein (2001) claims that, of all of the best practices, needs assessment is probably the most important part of the process. Therefore, training needs assessment is the foundation of the entire instructional design process. Klink and Streumer (2002) examined the effectiveness of on-the-job training and some potential factors that explain effectiveness of two samples drawn from two Dutch companies. The first sample consisted of 36 tele-sales staff who were trained to improve the quality of the telephone sales call, with the underlying objective of increasing sales. Khandelwal (2005) states that the challenge before the banks is not only to produce employees with multi-skills and applications, but also to develop these skills on a continuous basis. Ramu (2006) states that designing and implementing effective training and development systems is a particular challenge because all the costs are borne in the present, while all the benefits will be accrued in the future.nagar (2009) empirically examines training programs in staff training centers of State Bank of Bikaner and Jaipur 102

3 (Udaipur) and The Bank of Rajasthan Ltd. (Jaipur). The author highlights that a systematically designed training program helps in motivating the trainees towards effective learning. Karthikeyan et al. (2010) empirically examine the training methods and their effectiveness in selected public and private sector banks, namely, State Bank of India (SBI), Indian Overseas Bank (IOB), Indian Bank, Industrial Credit and Investment Corporation of India (ICICI) Bank, Housing Development Finance Corporation (HDFC) Bank, and City Union Bank and conclude that the overall effectiveness of training is quite high and that training contributes to the growth and better performance of the banks. 3 Organization Training and Development Philosophy Philosophy is the starting point to wisdom. Any organization that does not have a training philosophy is bound to fail for it invariably means that it does not have a serious approach for training. It may also mean that the organization pays lip service to training. If an organization does not have a training philosophy, it means that the organization does not believe in training. If an organization does not believe in training, it also means that there is no deliberate effort on the part of the organization to encourage training. Strategic Focus in Training: Training activities in an organization should be a continuous process and not a once and for all activity. It is an on-going process for new, old, transferred and promoted employees. According to Armstrong (1995) training strategy takes a long- term view of what skills, knowledge and levels of competence employees of the organization need. Training should be an integral part of the management process which in turn requires managers to review regularly with their teams and the individuals reporting to them, performance in relation to agreed objectives. Relevance of Training: Relevance of training is a very important issue that organizations should look critically at if they really want to improve the effectiveness of their employees. Any training program that is not relevant should not be undertaken. Training should be designed to solve problems and to fill gaps in employee performance. Training should make things happen and bring about changes that would enhance organization s effectiveness. It is not proper for an organization to embark on any training program which is not relevant to it and its people. 4 Objectives of the study The following are the objectives of the study: To study about the training and development programmes offered for Commercial Bank employees To evaluate the effectiveness of the training and development programmes To ascertain satisfaction levels of employees on improving the present system To seek the suggestions from by the employees on improving the present system To analyse the effectiveness of Training in selected banks in Ambala district, Haryana To find the association between effectiveness of training and growth and result of banks 5 Research Methodology The study encompassed primary data collection from three categories of respondent s viz. Trainees, (faculty) and Training Administrators. The trainees comprise of officers and Managers at the branch level. For the present study only officer cadre was selected, who incidentally key decision are 103

4 making strata at the operational/field level of the banks. The data was collected by the questionnaire method. A well-structured questionnaire was used to collect the primary data. For designing an effective questionnaire for the study, it was felt necessary to test the validity of the questionnaire. This was done by a pilot study consisting of visits to different branches of the selected six banks for this study developing a draft questionnaire and getting opinion of the bank employees on the draft questionnaire. The questionnaire also included few questions about the demographic variables such as age, qualifications and designation These were used as independent variables to assess the impact of them on the emerged factors of the study. The questionnaire was finalized based on the comments and suggestions of the bank employees and also the enhanced exposure of the researcher based on the field visits to various banks. Secondary data for the study were collected from reputed journals, magazines, websites and bank records. Total sample size for this study is 512 respondents. It consists of 454 respondents of clerical cadre and 58 respondents of managerial cadre in banks. The study of the researcher is about evaluating the effectiveness of training in commercial banks. The study makes an attempt in exploring and analysing different perceptions of partners of training in the area of Banking. It is a compact, inclusive, deep and intensive study of the commercial banks functioning in AMBALA city The area and the period covered by the study are extensive The method adopted by the researcher for this study is "Survey Method". The research design followed is descriptive design under which survey method has been adopted. The primary and secondary data collected from different sources have been tabulated and interpreted meaningfully. The information has been represented using bar charts, pie diagrams, graphical method etc. The researcher has used both primary and secondary data to achieve the research objectives Primary data includes data collected through questionnaire filled by the bank employees. The secondary data are collected from published papers, journals, books. Articles, reports of the committee on staff training and manpower development in banks to Indian Bank's Association and RBI Bulletin. Random sampling of employees from different banks like HDFC, ICICI, Vijaya bank, Bank of Baroda, Dena Bank. 6 Analyses and Interpretation A total of 427 respondents participated in the survey. They belong to different banks (from both public as well as private sector), different age groups, and different levels of seniority and expertise and from both sexes. A detailed distribution of the respondents on the basis of the demographic parameters such as age, gender and designation is presented below.\ 6.1 Age The distribution of the respondents on the basis of Age has been analysed. It is found that the respondents were distributed more or less evenly between the different age groups. However, the bank wise analysis shows a huge difference in the age category of public as well as private sector banks. Table1: Distribution of Bank staff on the basis of Age 104

5 Category Public Sector Banks Private Sector Banks Total No % No % No % Total Designation The distribution of bank staff on the basis of designation has been analysed. As the designations in public and private sector banks differ; some grouping has been done to make it uniform. The designations, Assistant Manager and Deputy Manager, have been grouped under the head Officer. Similarly Assistant Vice President has been grouped under the head Assistant Manager. Table 2: Distribution of Bank staff on the basis of Designation Public Sector Banks Private Sector Banks Total Category No % No % No % Clerk Officer Manager Sr. Manager Chief Manager Asst. Manager Total As given in the table, 16 staff (5.5 percent) in the public sector banks is Clerks. In private sector banks the corresponding figure is 19 (14 per cent). It needs to be further stated that the New Generation Private sector banks do not have the designation Clerk. All the clerks in the private sector bank category belong to the Old Generation Bank taken for the study. Majority of the staff taken for the 105

6 Pre- Training Factor Category Respondents ISSN (Online): studies were from officer grade. 226 out of 427 staff (53 per 120 cent) was officers. The respective figures in public and private sector banks are 56 per cent and 46 per cent. Other classifications are as under. 100 staff belongs to the manager level (23 per cent) 39 (9.13 per cent) staff belong to the Sr. Manager level, 23 staff (5.39 per cent) belongs to Chief Manager Level and four staff (0.94 per cent) to the Asst. Manager level. 6.3 Opinion of the Employees and Level of Satisfaction For the purpose of analysis, the collected data has been quantified. The responses of the participants i.e. strongly Agree, Agree, Moderately Agree, Disagree, Strongly Disagree has been given the numerical values 5,4,3,2, and 1 respectively. The data collected from four questionnaires have been grouped under the various variables. Further the data has been analysed using various statistical tools like tabulation, simple percentage, mean, rank analysis, student s t-test and Z test, MS Excel has been used as the statistical package for data analysis. Training context is defined as those situational factors which affect the training effectiveness? It includes factors before the starting of the programme [preparation, learning motivation, expectations], during the programme [areas of satisfaction/ dissatisfaction, training facilities, other facilities] and after the programme [cost, organisational support, organisational support hindering or facilitating use of training]. This study exhibits the opinion level of trainees. Factors Table3: Respondents opinion regarding Satisfaction of Training Context Public Sector Banks Total Public Sector Banks Total Overall Total HS S N DS HDS HS S N DS HDS Training Policy

7 Learning Motivation ISSN (Online): Training Need Analysis Participation in Determining Their Training Emphasis devolping manegerial competencies Emphasis devolping human relations competencies Briefing and Debreifing Enthusiasm to attend Training Training Need Analysis

8 Post Training Factors Other Facilities Training Managem ent Expectati ons ISSN (Online): Right understanding ou the training to be Training Facilities Supportive Facilities

9 Ex- Ex- Organizat ional Factors hindering of facilities use of training Ex- Organizat ional Support Ex- ISSN (Online): Cost- Benefit/Economic Viability Training Followup Evaluating Training Performance Line manager s support in training utilization Provisional of reflection time in training utilization

10 Table shows that opinion of the employee s category in their satisfaction of the training contest analysed. Analysis of the data revealed that private sector bank staffs are more satisfied than public sector bank staff. Age wise analysis revealed that among public sector banks, age groups has the highest level of satisfaction. The lowest satisfaction is among the age group. Among the private sector banks too the highest satisfaction is among the age groups. However, here the lowest satisfaction is among the age group. In the gender wise analysis it was found that in public sector banks, male staff has more satisfaction than female. Among the private sector banks, both male and female staff has the same level of satisfaction. Among the various designations of the staff Officers have the highest satisfaction among the public sector banks. The lowest satisfaction has been found among the Assistant Managers. However, among the private sector banks, it is the Managers who showed the highest satisfaction and the lowest satisfaction is among the Sr. Managers. 6.4 Rank Analysis of Variables in Training Context All the variables in Training Context has been consolidated and analysed on the basis of their rank and mean score. From Table 4, it was found that among the public sector banks, Training Facilities received the highest rank with a mean score of It has to be kept in mind in this regard that; in general, public sector banks have invested heavily on infrastructure. And that the staff is highly satisfied with the facilities provided. Variables Table 4: Rank Analysis of Training Context Variables Public Sector Banks Private Sector Banks Mean Rank Mean Rank Preparation Learning Motivation Expectations Training Facilities Other Facilities Cost Organizational Support Organizational Factors hindering or facilitating use of Training

11 It was found that among the public sector banks, Training Facilities received the highest rank with a mean score of It has to be kept in mind in this regard that; in general, public sector banks have invested heavily on infrastructure. And that the staff is highly satisfied with the facilities provided. The second rank is for Learning Motivation (mean score 4.07) and the third Other Facilities (4.05). The lowest rank is for the Organisational factors hindering or facilitating use of training having a mean score of 3.28, followed by Organisational Support (3.4). It clearly indicates that the structural barriers in the public sector banks are adversely affecting the training effectiveness. Among the private sector banks the variable, Cost has got the first rank with a mean score of 4.46 indicating that the cost benefit ratio is very good in their training programmes. This is closely followed by Training Facilities (mean score 4.42). Z Test Analysis: Z Test analysis was undertaken to assess whether there is significant difference regarding the reactions of the bank staff to the training context as measured by their average score on the evaluation form with the seventy five percent marks, at five per cent level of significance with a table value of The calculated Z value is 1.14 which is less than the table value and thus it is concluded that there is no significant difference. 7 Recommendations After employees have been selected for various positions in an organizations training them for the specific tasks in which they have been assigned assumes great importance. It is true in many organizations that before an employee is fitted into a harmonious working relationship with other employees, he is given adequate training. Training is the act of increasing the knowledge and skills of an employee for performing a particular job. The major outcome of training is learning. A trainee learns new habits, refined skills and useful knowledge during the training that helps him improve performance. Training enables an employee to do his present job more efficiently and prepare himself for a higher level job. Training for employees helps them: To get an insight of the job by the new employees and also to understand work culture followed in the organization; To acquire knowledge in order to adopt any change in technology or any change affecting the working of organization; To get promotion as again change in nature of the work but increase in payment will increase responsibility and challenges involved; To deal with the expansion and diversification where companies initiates other areas of business to gain their greater understanding; To update employee s knowledge and skill suitable training must be provided at regular intervals i.e. In a year or as per the requirement to keep the employees updated; All the banks whether private or public should share their training and learning techniques as a separate body it should provide standardized and uniform training so that young people will not get tangled up in ``different bank different training strategy; To acquire specific knowledge, skills and attitudes useful for performance and personality growth; To achieve better results, gain improved job satisfaction, prestige and recognition. 111

12 8 Conclusion In order to satisfy consumers from all walks of life banks need to have efficient manpower which can be possible by offering them quality training, training programme should keep pace with changing times it must be unconventional. Training changes mental and social outlook of employees. Customers and their needs can be identified and they are satisfied accordingly. A training programme is an effort by the employer to provide opportunities for the employees to acquire job related skills, attitudes and knowledge. In order to meet the ever-growing needs of business and household banking has to become dynamic and updated in modern scenario and also to take up this industry to the heights of international excellence require best combination of new technology and skilful and talented manpower. Therefore most of the commercial banks either private or public adopt training and development programmes at the time of induction, promotion and other situation. 9 References [1] BHATNAGAR 0 P Evaluation Methodoloqv for Training Theory and Practice New Delhi. Oxford ft IRH Publishing Co Pvt Ltd, 1987 [2] BRINKERHOFF, ROBERTO Achieving results from training how to evaluate human resource development to strengthen programmes and increase impact San Francisco Jossey-Bass, 1987 [3] DVORIN, ROBERT S Evaluation of training: In Handbook human resources administration by Joseph J Famularo New York McGraw-Hill, 1986, p [4] KAPPOR & SANCHETI Statistics S C Chand and Sons, New Delhi, 1982 [5] AI-Lamki & Salma Mohammed. (2000). Omanization: A Three Tier strategy Framework for Human resource management and Training in the sultanate of Oman.Journal of Comparative International Management, Vol.7 No5, pp [6] Riyaz Rainaye. (2004). Training Effectiveness in Public Sector and Private Sector Commercial Banks A Micro- Level Comparative Study. Management & Change, Vol 8, No 1 & 2, pp [7] Shishupal Singh Badhu and Karunesh Saxena. (1999). Role of Training in Developing Human Resources: Study of Selected Industrial Organizations of Rajasthan. The Indian Journal of Commerce, Vol.52 No.1, January March 1999, pp [8] Clement, RW. of Aranda, E.K. (1982). Evaluating Management Training: A Contingency Approach. [9] Training and Development Journal, Vol. 36 No. 8, pp [10] Jane Richards. (1997). Management Training-the Real Objectives. Training Officer, September 1997 Vol.33, No.7, pp [11] Nakkiran S. and Karthikeyan M.(2007) Training techniques for management development, Deep and deep publications pvt ltd, New Delhi. [12] Anthony Landale (2004) Training and Development A complete handbook, Gower publishing ltd, U.K [13] Klink et. al., Effectiveness of on the Job Training,Journal of European Industrial Training, 2002, p