Understanding the Issue
Reports have emerged that employees
are fleeing the countrys banks with employee turnover increasing by 67.8% in
Janurary of this year from January last year (Capital Alliance
Ltd.,2023Acknowledgement). Turnover could be due to migration, higher level of
education, personal reasons and chasing after greener pastures or better job
offers. And the economic meltdown in Sri Lanka has only made things worse, with
these employees looking for stability elsewhere.
Strategies for Improvement
Attractive Compensation and Benefits
Package
Top talent knows that banks have to
pay a pretty penny for good help, meaning competitive salaries and benefits are
mandatory. This includes generous health benefits, performance bonuses and
regular salary reviews. McGregor, 2006 states that competitive compensation is
important for employee satisfaction and retention. Proper compensation also
makes banks more attractive to existing and future employees.
Practical Training Opportunities
Career progressions is important. A
company that provides a structured way of moving up the ladder is more likely
to retain employees. As noted by Noe et al. As Schindehutte et al (2017) put
it, training and development investment ensures that the workforce continually
acquiesces to new skills thus preparing for higher responsibilities. Banks must
have strong training vehicles and a history of promoting from within.
Work-Life Balance
Another vital strategy is to
advocate a balanced work-life lifestyle. Employee satisfaction can be amplified
by offering flexible hours, remote work opportunities and wellness programs.
Work-life balance initatives lead to increased satisfaction and lower turnover
—Greenhaus & Allen 2011
Recognition and Employee Engagement
Retention is better when employees
are engaged and valued A safe work culture is nurtured by regular feedback,
employee recognition programs and having a say in major decisions. Engaged
employees are also less likely to exit and demonstrate high levels of
organizational commitment overall (Robbins & Judge, 2019).
Effective Leadership and Management
Reducing turnover calls for
effective leadership. Leadership & Interactions: Managers need to be
clearly trained in line with leadership and employee relation skills instead of
performing ad hoc support. Kouzes posner (2017) assert that good leadership
creates trust and loyalty in employees.
Conclusion
A mosaic of issues will need to be
tackled holistically if high levels of staff turnover at banks in Sri Lanka
(led by HNB and the People’s Bank) are going to come down: ensuring that
competitive salary packages and offer good value for money by managing careers
better, e.g. through rigorous workforce planning focused on providing employees
with a pathway upwards., work-life balance assistance made directly relevant
rather than generic, achieving greater employee engagement though moves as
diverse as introducing broad based
financial inclusion topics or even controversially removing unproductive
functions etc. Effective leadership drilled into managers thoroughly so they
set an inspirational tone throughout their organization . With these strategies
in place, banks are able to increase employee retention, reduce the cost of
recruitment and improve overall financial institutional performance.
References
Capital Alliance Ltd. (2023). Report
on Employee Turnover in Sri Lanka’s Banking Sector.
Greenhaus, J. H., & Allen, T. D.
(2011). Work and family balance: A review and extension of the work-family
literature. Journal of Management, 37(1), 50-76.
Kouzes, J. M., & Posner, B. Z.
(2017). The Leadership Challenge: How to Make Extraordinary Things Happen in
Organizations. Jossey-Bass.
McGregor, D. (2006). The Human
Side of Enterprise. McGraw-Hill.
Noe, R. A., Hollenbeck, J. R.,
Gerhart, B., & Wright, P. M. (2017). Human Resource Management: Gaining
a Competitive Advantage. McGraw-Hill.
Robbins,
S. P., & Judge, T. A. (2019). Organizational Behavior. Pearson
One of the key issues affecting organizational stability, and hence service quality in Sri Lanka's banking sector is high employee turnover. To combat this issue you have raised most effective methods to compensate employees better than competitors and build superior job skills to retain them longer. With a focus on these approaches banks can better retain talent, lower recruitment expenses and increase the overall performance and satisfaction.
ReplyDeleteTimely article of employee turnover. This article addresses internal factors that can be effect for employee turnover in banking sector. However, I like to draw your attention on external causes as well. You might aware that during last year most of the employee turnover is due to the economic instability in Sri Lanka. So, it would be great if you can address that also.
ReplyDeleteYou may refer below news article written by Imesh Ranasinghe in 2023 based on the webinar of Jonathan Alles.
https://www.themorning.lk/articles/5ZBc21eo8AuLlW9ZCN6W