Human resource development is a process through which employees in an organization are assisted to realize their full potential for their present and future jobs. It involves long term perspective which visualizes change through involvement and ownership of such change by the participants. HRD believes that individual in an organization have unlimited potential for growth and development and that their potential can be built through appropriate and systematic efforts.

HRD efforts have to be initiated organization wise, wherein everybody will have to take self-responsibility for growth and optimization of performance. HRD is a process undertaken to promote the intellectual, moral, psychological, cultural, social and economical development of the person so that he contributes his best to the community and the nation.

HRD process is facilitated by mechanisms like:

v Performance appraisal system.
v Potential appraisal and development.
v Feedback and performance.
v Career planning and development.
v Training.
v Organization development exercises
v Reward.
v Employee’s welfare and quantity of work life activities.
v Human resource information systems.

HRD IN BANKING SECTOR

Today’s increasing complex and volatile business environment characterized by globalization, liberalization and the transnational invasion ensures that managing would not be the same again. As we are in 21st century competitiveness in global market place presents the ultimate challenge to policy makers, business leaders and entrepreneur’s in any industry, including banking.

Those leaders would be successful who would manage the virtues of conflicting paradigms, rather than rely on single set of pre- determined theoretical “right policies”. This has created in its wake a need for adopting a proactive approach by bankers in all areas of organizational structure, administrative policies, and the most important the HRD.

As a result the banks have to continuously strive to give new thrust and direction to equip its employees to meet the emerging challenges. Hence a systematic HRD strategy focused on people is essential.

The need for HRD is all the more great in service-oriented institutions like banks.
An efficient, effective and disciplined banking system helps the process of economic development as per the national priorities. It functions as catalytic agent for bringing about economical, industrial, and agriculture growth and prosperity of the country.

The need for HRD in the banking institutions has continuously grown because of an effective role they play of social-economic development and upliftment of especially those people who are neglected and deprived. Banks have a strong industrial relation orientation which necessitates more and more focus on improving the HRD efforts have to be there to influence people to use HRD for achievement of goals both business and social.

The HRD policy in the banks has to act as an instrument to encourage employees to show creativity, to reach for excellence and finally to render better customer service, thus objectives of HRD in BANKS are: -
   
v Creating a climate of openness and trust.
v Building a collaborative culture whereby every one is an important member of an effective team.
v Preparing individuals for technological competence.
v Psychological preparedness for willing participation in change implemen-tation.
v Promoting human capabilities and competency in the organization.
v Facilitating building of a strong character of honesty and integrity in performance.
v Improving quality of work life.
The challenges and problems thwarting the banking segment
For a strong banking system it is necessary to go beyond the existing issues and benchmark against the best in the world.
The problem starts with slow progress in privatization of public sector banks and restrictive FDI norms for public banks. There is also a conflict in the role of RBI as both supervisor and owner, which at many a time has led to corporate governance issues, he said. The HR policies, especially those relating to the tenure of CEOs of banks have not been conducive for continuity and long term planning in banks. On the positive side, technological changes have had immense influence in the recent past. It has brought a change in the service paradigm, with several new products to suit customer choice. Banks are gearing to become a one-stop shop for financial products in the future, And with RBI, ready to adopt international norms, much depends on the legal reforms which could help expedite the loan recovery, ease the exit procedures and inculcate better borrower ethics.
The slow pace of recovery of bank dues has being one of the most prominent problems. The time has come to follow approach of rehabilitation of weak banks to start a reconstruction mode. Also, stringent and harsh penalties need to be enforced on willful defaulters.
Indian banking is at a point of inflexion. They are facing intense competitive pressures like other sectors of industry and services. The challenge for the banking sector is not only to come on top of the competition, but also provide funds at internationally competitive rates. The recent initiatives of the finance ministry have largely accelerated the reform process. There is still much to be done by way of disinvestments and decontrol of public sector banks, introducing innovative banking, etc.