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Sample Temporary Staff Employment Contract With Merchandising Company

It is our pleasure to offer you contractual employment with (company) for the position of (title). Your appointment will take effect on (date) and will be subject to the following terms and conditions:

1.     Compensation
You will receive fortnightly pay based on the hours of work and the established hourly rate of pay used by the company, plus commission on sales from sales events and wholesalers.

Bear in mind, that this a temporary contract with (company), where you will be required to rotate between locations, with no fixed space assigned. The contract will be reviewed on as is needed basis in conjunction with the fluctuating demand for the products. You will be responsible for filing you own taxes.

2.    Termination of Contract
If you should at any time contemplate terminating your contract, or should your services be considered unsatisfactory, one (1) month’s notice in writing is required on either side. Upon termination of this agreement or in any event that you owe the Company funds due to loans or any other debits to your account, you authorize the Company to offset such amounts against any other payments which may be due to you; provided, however, that this provision shall not limit any other obligation imposed upon you under this agreement.                                                                    

3.    Company Policies
You will be subject to the policies of the Company governing discipline, confidentiality and other standards of professional conduct which may be in force from time to time. Should you be in doubt at any time, you are to seek clarification from the Managing Director or your immediate Supervisor.    

We welcome you to the staff of (company) and sincerely trust that you will find your new job challenging, interesting and rewarding.

If this offer is acceptable to you, please sign the attached copy of this letter to signify your acceptance of the terms and conditions of employment, and return same to us at your earliest convenience.

Yours sincerely,
Company


Name
Managing Director

Simple Procedures to Administrate Cheques, Cash, Lodgments and Wire Transfers

Guidelines for Administering Cheques, Lodgments and Wire Transfers

  • A Requisition must be prepared filling in information required on the form. Where information is not applicable, the section should be left blank.
  • A Requisition must be written up and supporting documents must be attached before submission for approval.
  • Any of the following persons are allowed to authorised requisitions:  The Managing Director, Other Directors.                                                                         
  •  Cheques are prepared and cash must be packaged.
  •  Cheques must presented for signature.
  •  Payment details are written up in a disbursement book.
  •  When the payee or his representative collects a payment, he signs a disbursement register. A form of identification should be presented by payee.
  •  All payments, with the exception of Petty Cash, must be made following these guidelines.
  •  Cheque payments are made only on Wednesday’s and Friday’s.

Petty Cash

  • Imprest float of ($) must be observed.
  • The upper limit is ($) for any one payment.
  • Vouchers must be prepared, supported and approved before funds are disbursed.
  • The imprest float is to be reimbursed on a ‘needs’ basis.

Lodgements

  • A receipt is required for all funds received in the company.
  • Best practices dictate that all funds coming in to the company must be lodged promptly or by the latest the following day.

Electronic Transfers

  • All electronic transfers should be documented and daily records kept.
  • All bank accounts must be reconciled at the end of the month.
  • Customers who pay directly into the bank must be asked to fax in the payment slip.

Accounting for International & Local Money Transfers

Because many companies operate as money transfer sub-agencies in the remittance business, not many bother to get into the technical description and understanding of services offered much less delving into the operational details of how remittance transactions are to to be properly catured and recorded in the general ledger.

While Remittance Agencies provide reports, they may not necessarily be in the format required by internal management of sub-agencies, plus there is no way to track and reconcille numbers if reliance is placed soley on the Agency. It's important then that management undertsand remittancce service offerings and how to properly account for them as a check against reports provided by the Agency. 

The types of transfers typically offered by remittance companies, and by extension sub-agencies, are described below: 

Inbound Money Transfer

Inbound is money transfer sent from overseas to be paid locally. e.g. money sent from another country to the country of your residence. 

Outbound Money Transfer

Outbound is money transfer sent locally to any other country, e.g. money sent from country of residence to another country. 

Intra- Island/Country Money Transfer

Intra-island/Country money transfer is transfer sent locally within country of residence, e.g. within cities or from one city to another.

Journal Entries

Here are sample journal entries for accurately capturing remittance entries to the General Ledger:

Payouts from overseas                            

Outra Island/Country Transfers - Dr xxx

Remittance Agency Float -Cr xxx 

Receival/Pay-ins to send overseas 

Remittance Agency Float - Dr xxx    

Outra Island/Country Transfers - Cr xxx

Payouts Inter-Island/Country 

Intra Island/Country Transfers - Dr xxx

Remittance Agency Float - Cr xxx

Receival/Pay-ins to send Inter Island/Country 

Remittance Agency Float - Dr xxx

Intra Island/Country Transfers - Cr xxx

To record commission receivable from Agency Operations

Commission Receivable - Dr xxx    

Agency Commission - Cr xxx

Entry to record receival of commission from Agency

Local Currency Float/Bank/Check clearing - Dr xxx

Commission Receivable - Cr xxx

Recording a Business' Daily Intake of Revenues (Receipting)

The receipting function is critical to any business as it’s the first step in capturing in a comprehensive way revenues which will ultimately determine overall intake, profits and losses and whether the company survives over the long haul. 

The function itself can become arduous in larger companies as they seek to categorise revenues by location, business, product and currency. 

See this post for a guide to establishing a simple but robust receipting system.    

Objectives

 To ensure that: 

  • Cash receipts are accurately recorded as received. 
  • Cash receipts are deposited to bank accounts or vaults, the same day they are received. 
  • Proper segregation of duties is maintained in the receipt, lodgement and recording of cash receipts. 
  • GL entries and other internal records are accurately updated with cash receipts.

Policies

  • To achieve the above objectives the following policies are to be adhered to:
    • Sequentially pre-numbered receipts should be completed by Operations Officer/Cashier or assigned custodian and the original sent to the client for every cash receipt.
    • Funds should be lodged to bank account or put away safely in vaults the same day they are received. 
    • Operations Officer/Cashier or assigned custodian should check batch receipts total with lodgement slip total to ensure that no discrepancies exist.
    • Batch receipts should be used by Operations Officer/Cashier or assigned custodian  to create journal voucher to update the underlying financial records.
    • Journal vouchers are checked and approved by OPS Head and input by Operations Officer/Cashier or assigned custodian. 

The Administration of Company Payables

Normally all company payables are settled using properly generated and properly received invoices as support. Any exceptions are supported by internal memos signed off on as allowed by the Policy and Procedures Manual. 

Functions

  • The Operations Clerk/Officer or assigned custodian will maintain and store in a safe place an adequate supply of blank cheques for use on a daily basis. 
  • Receive invoices due for payment and review for authenticity, approve bona fide liabilities, query and resolve any claims that may arise. 
  • Check invoices:
                       accuracy and approval
                       adequate supporting documentation
                       agreement with purchase order 
  • Prepare cheque requests coded with the appropriate general ledger account numbers. This process is manual in some offices and in others, fully automated.

  • Attach supporting documentation to cheque request forms and pass to the Operations or Finance Division for approval. 
  • Review and approve cheque requests that have been properly processed.  Follow up any discrepancies. 
  • Cheques usually to be signed by two (2) authorised signatures or as dictated by Policy and Procedures. 
  • The Operations Clerk/Officer or assigned custodian retrieves cheques from cheque signatories and separate from the cheque request forms. 
  • Record cheque in outgoing cheque register and despatch promptly to the payees directly, by mail or by bearer. 
  • Stamp cheque requisition, invoice, or bill “PAID” to prevent re-use inadvertently or otherwise. 
  • File cheque request forms. 

Sample Standard Terms and Conditions of Employment

STANDARD TERMS AND CONDITIONS OF EMPLOYMENT 

1.        Probationary Period 

i.          The first three months of employment will be probationary. The Company may at its discretion extend the period of probation up to the maximum of a further 3 months.

ii.         During the first probationary period, either you or the Company may terminate the contract without notice and without stating a reason.

iii.        Your performance and suitability for continued employment will be reviewed during and at the end of your probationary period.

iv.        If you are confirmed for permanent employment, at the end of the probationary period employment shall date from the commencement of probation.

2.        Salary

i.          Salary will be paid monthly in arrears.

ii.         You will be notified of any changes in salary.

3.        Deductions

The Company reserves the right in its absolute discretion to deduct from your pay any sum which you may owe the Company including, without limitation, any overpayment or loans made to you by the Company or losses suffered by the Company as a result of your negligence or breach of contract.

4.         Normal Hours of Work

Working hours are 10:00 a.m. to 6:00 p.m. Mondays to Fridays.  It may, however, become necessary for you to be required to work longer hours as the circumstances of the job might dictate from time to time without additional compensation.

5.         Holiday Entitlement

Upon completion of one year's employment you will be entitled to two weeks' paid vacation leave, and thereafter in accordance with the Company's policy.

6.         Termination

i.          In all cases, other than gross misconduct, should the Company decide to terminate your contract of employment, you will be entitled to written notice of termination or a payment in lieu for the periods set out in the Employment Termination and Redundancy Payments Act or such period as agreed to by the Company and set out in your letter of employment.

ii.         You will be required to give the Company a minimum of one month's notice (or such period as set out in your letter of employment) in writing to the Company should you decide to terminate your contract of employment.

iii.        The Company reserves the right to make a payment in lieu of notice should it so wish and/or require you to remain away from work during your notice period, whichever the Company shall deem appropriate. During such notice period or should the Company decide to pay you in lieu of giving notice.

7.        Other Employment

i.          You must devote the whole of your time, attention and abilities during your hours of work to your duties for the Company. You may not under any circumstances, whether, directly or indirectly, undertake any other duties of whatever kind, during your hours of work.

ii.         You may not without the written consent of the Company engage, whether directly or indirectly, in any business or employment which is similar or in any way connected to or competitive with the business of the Company or which could or might reasonably be considered by others to impair your ability to act at all times in the best interest of the Company, outside your hours of work for the Company.

8.        Confidentiality

i.          You must not disclose any trade secret or other information of a confidential nature relating to the Company or any of its associated companies or their business or in respect of which the Company owes an obligation of confidence to any third party during or after your employment except in the proper course of your employment or as required by law. 

ii.         You must not remove any documents, data or information (in electronic form or otherwise) from the Company's premises at any time without prior authorization.

iii.        You must return to the Company upon request and in any event, upon the termination of employment, all documents and tangible items which belong to the Company or which contain or refer to any confidential information and which are in your possession or under your control. 

Signed for and on behalf of YYY on the 4th Day of               . 

 

President

 

I have read, understood and accepted the Standard Terms and Conditions of Employment as stated and referred to in the document set out above that is relevant to my employment with the Company. 

 

________________________                                ______________________

Employee's Signature                                                  Date

Simple Employment Contract for a Store Manager

Small to medium-sized stores are often guilty of either not having the necessary resources or just too busy to formalise their operational contracts. It's not a good practice especially now with many workers being aware of labour laws and more willing to defend their rights. If line staff are aware, Store Managers should be much more equipped and represent a greater level of potential liability. Here is a simple contract for a store managerial hire...protect yourself and your employees!

*** 

Date

Miss Indira Channer

Lot 72, 7 East

Greater Washington, USA 

Dear Miss Channer,

Re: Employment Contract with Nu Wireless Limited

It is our pleasure to extend the following offer of employment as the Store Manager for Nu Wireless Limited commencing Tuesday, May 4, 2011.  You will be required to perform the duties outlined in the attached job description.

Your compensation and benefits packages are made up as follows:

1. A Base salary of USD50,000.00 per annum to be paid in monthly installments, subject to the deductions for taxes and other withholdings as required by law or the policies of the company.

2. Traveling allowance of USD3.00 per kilometer (out of town travels only).

3. Participation in the Company’s Health Plan.

4. 10% commission on the sale of each cellular phone.

5. Lunch subsidy of USD5.00 per day.

6. Commission on the sale (wholesale) of phone cards to customers will be shared between yourself and the company – the effective date to be mutually agreed on.

7. Cellular phone call limit of USD30.00 per month.

8. Annual incentive based on profitability.

This compensation package will be reviewed at the end of six (6) months from the date of appointment.

If you are in agreement with the above, please sign below.  This offer is in effect for 10 days hence.

Sincerely,

 

Nu WIRELESS LIMITED

President 

 

_________________________________________ 

INDIRA CHANNER                                  Date 

Some Considerations for an Automated Receipting System

Many companies use a simple receipting system but with automation to take into consideration multiple currencies, parent company and subsidiaries, branches, etcetera., a well thought out numbering system will enhance greatly accurate data capture. An automated numbering system may include the following:

                     CCY | I | C | N | B | L |

CCY- currency (J-J$, U-US$, E-Euro)

I - kind of item (M- managers cheque, R - regular cheque from pre-approved client, C - Cash, O-other)

C - company receiving funds (full or select letters from abbreviated name to be used)

N - Numbering system (sequential numbering from receipts)

B - internal assigned number for receiving branch

L- lodgment receipted funds will be a part of (some companies make a number of lodgements per day)

An example of a receipt number would therefore be:

UMF100043 representing certified US$ amount received for lodgment to Subsidiary "F" in branch 4 for 3nd lodgment being sent to bank.

U - US$ Received

M - Item received was a Managers Cheque

F - Reference for company receiving funds

1000 - sequential numbering system

4 - Reference for branch receiving funds

3 - Funds receipted was included in 3rd lodgement for the day

The system above works well in an automated environment where the officer receiving funds can simple choose from dropdown options. The receipt normally generated in duplicate is be used by officer signing off on lodgment for verification of funds making up lodgment.

The original of receipt is given to customer, one copy goes with lodgment for verification before sending to the bank and ultimately for support of general ledger entries  and the other goes to the client's file.

Model Answer: Describe and Analyse the Culture of Your Organisation

"Describe and analyse the culture of your organisation and how it has altered (if at all) over the past ten years. Comment on the extent to which the culture change (or lack of it) has been deliberately and effectively managed by senior executives."

***

The organisation being considered for post is Manufacturers Merchant Bank (MMB) then in its tenth year of operations. The bank started business on a very small scale (three employees in limited rented office space). Today, although still relatively small by international standards, it has grown many times over. It is the second largest independent merchant bank in Jamaica with assets of approximately J$3 Billion.

In the initial stages of the bank’s development, even with expansion to more than three employees and the rental of additional office space, the bank’s culture continued to be largely influenced by the then CEO, an ex-employee of Citibank, NA, who in setting up MMB simply borrowed the Citibank way of doing things. In essence, there was a strong emphasis on corporate image and an unrelenting push to providing service of the highest order to carefully selected markets. The assignment will show, using Edgar Schein’s model, how MMB’s organisational culture has progressed over the years and how it is manifested today. This to be followed by a examination of how this cultural progression was managed deliberately and effectively by senior executives at MMB.

Culture, according to Stephen Robbins is “ a system of shared meaning held by members that distinguishes the organisation from other organisations”. Edgar Schein saw organisational culture as an objective entity. According to him, culture represents a “set of behavioural and or cognitive characteristics”. He defines culture as “ a pattern of basic assumptions invented, discovered, or developed by a given group as it learns to cope with its problems of external adaptation and internal integration - that has worked well enough to be considered valid and, therefore, to be taught to new members on the correct way to perceive, think and feel in relation to these problems”.

According to Edgar Schein’s organisational model on culture, there are three levels of culture - the artifact level,  the values, beliefs and attitudes level and the basic assumptions level. According to Schein, artifacts are the most artificial manifestation of culture followed by beliefs, values, and attitudes with basic assumptions at the deepest level.. MMB’s culture is manifested at all three levels in various ways.

ARTIFICIAL LEVEL

Material Objects

At MMB, considerable emphasis is placed on delivering products and services. The basic rule is that products and services must be consistently delivered with the highest degree of efficiency and professionalism possible. This has always been a basic objective even in the bank’s early days. The process starts with advertising and promotional items such as annual reports. Ads must meet strict standards of design quality, conservative image  and frank, honest representation.

Annual reports have just become a feature of the bank’s accountability to its valued clients. The first report released reflected the considerable emphasis placed on ensuring excellent paper and print quality, reproduction standards and material content. Great effort was made to ensure the report captured the essence of the bank’s conservative image.

Other important material objects are letterheads, the banks logo, complimentary slips, and business cards. These also, have always received special attention both in terms of reproduction quality and projection of the bank’s image. In particular, the banks logo, which was redesigned to keep up with changing times captures the bank’s advertising tag line (slogan) and must accompany every new ad or promotional item. This tag line, “No Ordinary Bankers”, reinforces the banks commitment to innovation and high levels of service quality.

Physical Layout

At start-up, MMBs office space was quite limited.   None-the-less, the floor space was designed around an “open” concept to seat junior and other administrative staff  while particular effort was made to provide enclosed offices to senior managers. Considerable emphasis was placed on neatness and ensuring comfortable surroundings for visiting clients. This kind of care could not extend further as the bank’s rented office space located on the eighth floor of an office complex made control over its parking area and general appearance of building was impractical.

Later in its  development, the bank purchased its own building and finally got control over its entire delivery system. While the same “open” concept was maintained,  offices were updated with “new age” modular office furniture. Emphasis was placed on well co-ordinated office decor with waiting and meeting areas immaculately arranged. A television set has been recently introduced for the viewing pleasure of staff and clients alike. All these have served to reinforce an image of prosperity while having the twist of youthful flavour. (The youthful flavour being a true reflection of the current staff complement). 

Dress Code

As mentioned before, dress codes were always quite rigid. This meant standard formal office attire without exception. However, starting about two and a half years ago, Fridays were designated “dress down” days which allowed staff to dress for work in more comfortable semi-formal wear. This was introduced to encourage a more relaxed atmosphere.

Technology.

MMB prides itself in its strong commitment to service and the high standards attained and maintained over the years. With increasing global technological innovation, the bank has continuously reviewed and updated its computer technology to better take advantage of advancements in computer hardware and software. The bank’s Information Technology unit ensures maximum utilisation of available technology to assist in the continued delivery of products and services with great efficiency. This, by ensuring that systems are able to handle increasing transaction volume and processing requirements.

Other information technologies such as fax machines have been updated recently to accommodate better quality reproduction on hard paper, save time and improve quality of stored information. In addition, telephone instruments and, in particular, features available through the local service company have also been updated to take advantage of voice mail and other useful innovations. More advanced copiers have replaced older versions to accommodate increased photocopying needs and in recent times a telex machine was for the first time installed to allow wire transfers to be effected “in-house”.

Language

MMB has always emphasised a more relaxed working environment. One of the ways in which this was accomplished was to have everyone, including the CEO, on a first name basis. In addition, senior managers were always encouraged to initiate light and jovial discussion with junior staff which would send strong signals for them to do same among their peers, thus facilitating a more relaxed working atmosphere.  

Symbols

Symbols, with the addition of Corporate Finance as a  strategic business area have recently become a popular manifestation of MMB’s culture. These are in the form of “tombstones” which symbolises the pride in having completed some form of complex deal. It was always thought that by doing these “tombstones” it would be reinforced in client’s minds, MMB’s proven expertise and ability to be successful in handling the structuring of large complex facilities very important to the overall image of the bank.

Rules, System and Procedures

With MMB being a bank subject to periodic regulatory inspections, the existence of rules, systems and procedures were always very important despite remaining undocumented until recent times. The growth in balance sheet size and staff complement made the need even greater. This complex task involved reviewing, recommending and documenting MMB’s policies and procedures was given to Price Waterhouse. Once complete staff were encouraged to adhere to the strict guidelines or risk punishment as laid down. This of course has helped to reinforce correct organisational conduct and the structured approach in which bank transactions are to be effected.

VALUES BELIEFS AND ATTITUDES

Values “determine what people think ought to be done”. At MMB, going back to its inception, core values manifested by the highest levels of management are honesty and integrity. These being important on two fronts:

Þ    staff dealings and with co-workers; and

Þ    staff dealings with bank clients.

Honesty and integrity are time recognised qualities of bankers and banking institutions. They uphold a bank’s image and are priceless in the whole question of trust. These core values are fully appreciated by staff at MMB as in the past any breach has resulted in employees being summarily dismissed.

Beliefs

These are basically “what people think is and is not true”. A dominant belief with the Board at MMB is that by attracting and retaining top quality staff  while maintaining strong emphasis on technology will not only ensure growth and strong profitability but also ensure that high service standards are maintained. This again from the company’s very inception.

BASIC ASSUMPTIONS

The Relationship With Environment

MMB never set out to be “all things to all people”. Instead  its objective has always been to carefully carve out a niche made up of high net worth individuals, “blue chip” companies, other financially sound, well-run organisations and multinational corporations. With narrow focus, the company’s objective was to be able to concentrate on satisfying market determined needs with a high level of professionalism.

The Nature of Human Activity

MMB takes pride on being able to survive harsh economic conditions and ever changing macro-economic policies that characterise the Jamaican reality. The feeling has always been among top management that regardless of economic climate, the bank was bound to succeed. In part, this would have been largely due to adopting a proactive approach. This approach is facilitated by  an on going call program which seeks to identify new clients and spot new business opportunities while coming up with workable creative solutions.

The Nature of Human Relationships

At MMB, transactions require considerable input at various levels to take them to completion. As such, team work is extremely important and strongly encouraged to take transactions initiated in marketing units through the initial approval stage then through other units such as Risk Management and Operations. Without strong focus on teamwork, the bank would not be able to deliver its products and services in an effective, timely manner.

In addition to teamwork, democracy is an ever present feature of day-to-day operations. Where ever possible, in order to promote feelings of being a part of a whole ,there is always a democratic approach to problem solving and general decision making. For example, staff play a big role in ultimately determining the nature of staff related activities and make significant input in systems development and design. Overall, even if staff are left out of critical decision making, communication plays a big role in keeping staff abreast.

With increased staff levels, teamwoirk and democratic principles have become even more important as aspects of MMB’s cultural manifestation.

MANAGING THE CULTURAL CHANGE AT MMB

From the foregoing, it would be more appropriate to describe the manifestation of identified cultural change at MMB to be more of an evolutionary process. While there have been temporary deviations resulting from uncontrollable external factors, for the most part, cultural change has occurred naturally from the process of growth and technological innovation.  At the artifacts level, the culture described has prevailed through top management’s strong desire to run an organisation built on its reputation of maintaining high service standards and readily identified through its unique image. The culture has prevailed through management’s insistence on minimum standards while being very involved approach in decisions impacting these areas.

At all levels, however, the bank’s HR systems have been important tools in the management of culture and cultural progression.

Recruitment and Selection

Here, especially at senior management level, previous experience, qualifications and achievements are important. However, prospects who are already known by existing senior management  or who can be recommended by well respected business leaders stand a better chance of been recruited. In essence, through this process unknown elements are removed making the process, of full cultural integration much more likely.

Compensation, Performance Appraisal and Training

MMB’s compensation system is basic pay also play a big role reinforcing cultural manifestations. This by ensuring competitiveness with industry standards. The system helps to attract and retain quality staff. Additionally, training and performance appraisal are also key. Performance appraisal identifies and rewards those qualities important to maintaining expoused culture. While, on the other hand, training, especially in new banking techniques and information technologies have been important in the efficient delivery of products and services.

 Management Action

Management action has also been very crucial in managing culture and cultural change at MMB. For example, with honesty and integrity, clearly defined policies and procedures have established a level playing field which eliminates inconsistent decisions capable of promoting bad feelings and mistrust  in management.

Similarly, at the basic assumptions level, management action again plays a big role in setting the desirable tone . For example, with “the nature of human activity and relationships”, top management not only developed and implemented a call programme but is very much a part of the day-to-day process.

Socialisation

The socialisation process at MMB begins once a new employee has joined. This phase is important in managing culture. For example, it is during this phase that staff have adequate time to familiarise themselves with documented policies and procedures so important in the context of a guiding force...

CONCLUSION

It has been shown, using Schein’s model, that MMB’s culture is manifested at the most artificial level to the deepest level . Further, over the ten years, its culture has progressed logically from the process of expansion. Importantly, certain manifestations, such as honesty and integrity have deep roots in the organisation and its founders and have been with the company since start-up.

The management tools used in managing culture and cultural change, it was shown, included the banks HR systems, management action and socialisation. These tools have been deliberate and largely effective. Through this management process, it is management’s intention to create a culture founded in solid principles. While they integral in laying the initial foundation they also maintained a strong commitment  and are involved in key decision areas which ultimately impact culture.

Finally, as the company continues to grow, its culture will continue to evolve. With this reality, it is well recognised that, very importantly, the banks HR systems will have to be become more formalised if they are to remain deliberate and effective tools.

SOURCES

Brown, Dr Andrew, Human Resource Management, Study Guides 1, 2 & 4.

Schuler, Randall S. and Huber, Vandra L., Personnel and Human Resource Management.

Robbins, Stephen P., Organisational Behaviour, Concepts, Controversies, Applications.

Brown, Andrew, Organisational Culture

Describe the culture of your organisation or a specific part of it.

(A) Describe the culture of your organisation or a specific part of it

The approach to the post will involve a very brief look at recent change at the organisation being considered as this has had a profound impact on the existing culture. The culture of the organisation will then be described in detail.

The organisation being considered is Manufacturers Merchant Bank (MMB) as it was in 1999. In recent times these institutions have undergone extensive change. This brought on by “triggers” which were external in nature. They included harsh economic conditions and steep adjustments in Central Bank regulations. As a result the bank was literally forced to change its entire interactive framework. This as described by Harold Leavitt included the people, the tasks, the structure and the technology. In the end the bank was forced to cut its staff from 54 to 31 while radically changing the very essence of its business focus.

Culture is the way in which an organisation does things. It is collectively the values, beliefs, the image of the organisation. According to Stephen Robbins, it is a common perception held by the organisation’s members; a system of shared meaning. He identifies seven primary characteristics that in aggregate capture the essence of an organisation’s culture. It is under these headings that the culture of MMB will be described.

These include:

Innovation and Risk Taking

Innovation is a high priority criterion for MMB especially at managerial level. This as certain levels of creativity are required in structuring transactions and pricing to maximise income to the bank. However, while innovation is encouraged risk taking must be kept to a minimum. In fact it is the manger who can be innovative while at the same ensuring that all risks are covered who receives the most admiration and is highly sought after in the industry. MMB’s recruitment policy at this level is geared at this kind of worker.

In addition, the delivery of products and services is key. Quick and efficient means to facilitate the process are highly valued by MMB. Staff  (especially Technology and Operations personnel) are always reviewing processes and coming up with ingenious ways to speed transaction flow.

Attention to Detail

Being a bank this dimension is extremely important. On a daily basis transactions happen at rapid pace and simple errors can be very costly and come across as unprofessional. As such, officers are expected to be “deadly” accurate in pricing transactions.

Further the omission  of simple details from transaction documentation can put the bank at risk by breaching Central Bank regulations and or other legal considerations. In booking credits security taking is a very risky process. Security officers must pay particular  attention to detail in ensuring that security documentation is perfected with no chance of the transaction coming back to haunt should the bank wish to call on its security.

Outcome Orientation

The techniques and especially the processes used to take transactions to completion are extremely important. Because banks must operate with minimum risk, it is very important that transactions are executed in a very controlled environment as there are important banking regulations and certain other standards to measure up to. For example, in booking a loan facility, a proper credit approval must be done with full sign-off from the credit committee. The transaction must meet the expectations of the Risk Manager and also an outside Legal Advisor. Operations, in turn, checks for accuracy of information, proper execution of documentation and  collection of fees before disbursing to client.

People Orientation

People orientation is not MMBs strength. This culture is probably borne out of the recent tough times that the bank had to survive. With tough economic conditions and more stringent banking regulations, management was forced to take on a “hard-nosed” approach. The external forces called for change in many areas of the bank. Management felt the change was inevitable and necessary and went about the process without much feeling for workers involved. This blatant disregard and the lack of persistent communication to allay certain fears has resulted in an undertone of mistrust between lower staff especially and management.

Team Orientation

Teamwork is a very strong area of focus for the bank. With the heavy trading focus and with the new integrated technological structure which is characterised by the one time capture of information the input of all staff in any product or service delivery is key. For example, in a simple Foreign Exchange trade, for efficient delivery, the Trader quickly inputs information to software trading system. With printed deal ticket the signature of Unit Head is then required. This is followed by a sign-off from the Operations Head for the cutting of the cheque. This process must be automatic as the Trader must return to trading desk to complete other trades.

Once cheque is cut, signing officers  must be available to sign cheque. This process must be almost instantaneous as any slight delay in settlement could mean deal cancellation. The cheque is returned to trading desk for settlement of transaction. The teamwork component in this process is therefore extremely important. Like this simple trade, many of the banks other products and services have similar processing requirements.

Aggressiveness

The staff can described as aggressive. Again this has come out of recent changes at the bank. It essentially comes from two angles. In one aspect new staff are intent on proving themselves in the new environment. On the other hand, there is the longer serving staff who are insecure and still trying to protect territory while at the same time trying to justify their position in the face of continuing change.

Additionally, marketing staff (Traders) who are by nature aggressive characterise the bank as up to banking hours (2 p.m. daily) their is non-stop action in order to get transactions completed on time. This involves timely delivery and lodgement of cheques, documentation, etceteras. This in the face of stiff opposition from the Operations Unit mandated to ensure that proper procedures are adhered to at all times.

Stability

MMB has undergone rapid change in recent times and is still undergoing this change. This as the bank struggles to regain its “footing” in the market place and put itself on a path of growth. Workflows and system design are still undergoing change as the search continues for the best fit. This has made for staff who still feel insecure about their jobs as processes undergo extensive automation.

(B) explain how the culture provides opportunities and constraints for styles of leadership and follower-ship within the organisation.

In this section leadership will be defined and various styles explored to determine the opportunities or constraints provided by the various dimensions of MMB’s culture. Follower-ship will then be looked at in a similar context.

According to Stephen Robbins Leadership is the ability to influence a group toward the achievement of goals.

Throughout the discussion on MMB’s culture above it is quite evident how recent changes were impacting on the bank and its existing culture. Brief mention is made of the adverse impact of these changes and the effect on staff. With the potential threat to the organisation from this on-going process it can be argued that the opportunity exists for the charismatic approach as put forward by the Charismatic Leadership Theory.

With the change process largely unfinished and the level of uncertainty in the organisation, a proper articulation of the new vision and approach for the bank may go a far way in solving the existing problems. This strong articulation may move staff to identify with the vision or sense of purpose and open their eyes to a better future for the bank.

By communicating high performance expectations and how they can be attained the charismatic leader may just be the solution to overcoming the present unsure situation the bank faces. According to supporters of charismatic theory, the approach builds follower self-esteem and self-confidence. 

Similarly, the situation descried above could be the open door for a leader with a strong personality. This from the Trait Theories point of view. In contrast to the charismatic leader, this style would be “hard-line”. It would require an incumbent with energy, ambition, job knowledge, self-confidence and intelligence to move ahead with the change process regardless of the outcome and with the mental toughness to deal with the consequences.

Path-goal Theory

The path-goal theory is a form of Contingency model and is useful as the essence of the approach is that the manager adopt a different style for each situation. With the various facets of MMBs culture described above there is no doubt the effective leader may need to adopt various approach or a combination to meet variety of situations that may arise.

This theory was developed by Robert House. Essentially, it holds that the leader’s job is to assist his or her followers in attaining their goals and to provide the necessary direction and/or support to ensure their goals are compatible with the overall objectives of the group or organisation. House identifies four leadership styles:

Directive Leader

The directive leader is firm in approach. He clearly outlines expectations, schedules work to be performed and is clear-cut on how tasks are to be undertaken. MMB may find such a leader useful. This kind of leader by been firm in approach may minimise “Risk Taking” and at the same maintain the reinforce “Attention to Detail” that are so prized thus keeping costly errors to a minimum. The cultural distinctions are discussed under “Innovation and Risk Taking” and “Attention to Detail”. By minimising input from staff the leader ensures that his own high standards are brought to bear on the day to day work routine.

In addition, the directive leader may facilitate teamwork as with expectations, schedules and approach laid down, groups can more focus on the task at hand rather than be caught up with the details of work processes and scheduling that can result in conflict and divisiveness within the group. Also, with the change process described the firm approach may be helpful to turning around the organisation. Where external forces threaten the organisation, certainty in approach may mean the difference between surviving and failing.

The directive leader however will stifle in-novativeness since employees are not given a chance to make input in task completion. This goes against the kind of behaviour that MMB would want to encourage. Also the problems as discussed under “People Orientation”, “Stability” and “Aggressiveness” will continue with a directive style approach. With little input from staff they may not feel a part of change process not to mention costly mistakes that could be made by managers without proper consultation with lower level staff.

Supportive Leader

The supportive leader is friendly in character and is very concerned about the needs of subordinates. With this kind of approach there is some opportunity where MMB’s culture is concerned. For example with the “Stability”, “Aggressiveness” and “People Orientation” aspects of culture described above the supportive leader would go a far way in helping to calm some of the fears being expressed by staff. The friendly approach would bring a certain warmth to relationships and help to massage feelings of insecurity and mistrust.

In addition, with the heavy teamwork component of MMB’s culture the supportive leader has a very important role to play by: (1) being there and available and willing to provide advice on difficult transactions (2) being there to sign-off on transaction (deal) tickets, and (3) being there to sign cheques cut for settlement. An extrapolation can be made of the absentee leader or non-supportive leader and the impact on the very day-to-day business that the bank is mandated to carry out.

Similarly, the supportive manager with the relevant knowledge and years of experience can be there to support and nurture the “Innovative” dimension of the culture. The supportive manager by using the friendly approach may bring out the necessary creative “juices” stored in subordinates. The supportive style facilitates guidance in structuring difficult innovative transactions, help to avoid pitfalls and at the same ensure that all risks are taken into consideration and properly covered.

On the other hand, however, the supportive leadership style may give the wrong impression to staff: That is, one of looseness. Therefore the strong emphasis placed on “Attention to Detail” may suffer as result. Similarly, the friendly approach may give staff the feeling that they can make costly mistakes and take unnecessary risks and get away with it.

The “Aggressive” and “Stability” aspects of the culture may remain the status quo as the friendly nature may give staff the impression that a relaxed approach can be taken to the change process. With this approach the consequential issues of the process as described under “Aggressiveness” and “Stability” above will be perpetrated.

Participative Leader

The participative leader is always consulting with subordinates in the decision making process. This again holds possibilities for dimensions of MMB’s culture. The participative leader by involving employees give them a feeling of belonging and importance. This eventually could have the effect of changing the “People Orientation” aspect of the culture.

Additionally, by being participative, the leader will encourage teamwork which is another important aspect of the culture. By setting the tone of consulting subordinates staff become comfortable with other senior staff and peers. The consultation will give staff the feeling that their individual inputs are important to the overall functioning of the organisation.

However, a constraint for the participative leader is that in times of change where strong leadership may be necessary the consultation process will necessarily result in conflicting signals as the daily routine of staff is upset and the opinions blurred by misinterpretation, insecurity, etceteras. In these instances singularity of purpose is important in taking the organisation forward especially in light of serious external threats.

Achievement Oriented Leader

This leader sets demanding goals and expects the very best from subordinates. This approach can be useful as the demanding goals can motivate staff to heights of creativity. In fact from Latham and Locke’s goal-setting it may seem that this style would be quite effective as they argue that specific and challenging goals by themselves or used with other incentives bring out very high levels of performance.

Teamwork is also encouraged as staff bond to accomplish very difficult goals which would not have been otherwise attainable. The approach is also facilitates “Outcome Orientation” as staff is encouraged to focus more on outcomes and less on processes.

By the same token, however, by focusing more on outcome unnecessary risks are taken and attention to detail suffers. Also with this focus on achievement, the problems as discussed under “People Orientation”, “Aggressiveness” and “Stability” are compounded. The kind of competition among staff heightens with individuality coming to the fore and teamwork being made to suffer.

Follower-ship

Robert Kelly in his article “in Praise of Followers” argues that while effective leadership is important it is also important to have good followers. He identifies characteristics such as enthusiastic, intelligent and self reliant as making a follower effective. According to Kelly there re four qualities of effective followers:

¨      they manage themselves well;

¨      they are committed to a purpose outside themselves;

¨      they build their competence and focus their efforts for maximum impact;

¨      they are courageous honest and credible.

In the context of MMBs existing culture significant opportunities exist for the effective follower who can help to reinforce positive aspects of the culture while eliminating negative aspects.

The change process has been mentioned frequently and its impact on culture is related through “Stability, “Aggressiveness”, and “People Orientation” in the first part of assignment. While the staff of MMB may have the qualities of effective followers outlined above the feelings of insecurity and mistrust that permeates the culture may suppress these qualities thus resulting in highly in-effective followers.

On the other hand, with the turmoil being faced by the organisation, in the same way, negative aspects of the culture can be eliminated by staff and in so doing help the organisation “turn the corner” and establish itself once more on a sound “footing”. With the  situation described workers who are prepared to take the initiative, have some strong sense of purpose and are prepared to work diligently at mastering their skills would be a plus for the organisation. With sound approach to decision making, the opinion of staff on the change process in particular would be more valuable to the leader.

 Other aspects of the culture such as “Innovativeness”, Attention to Detail” are reinforced by the qualities outlined above. “Outcome Orientation” and “Team Orientation” are also positively reinforced by these qualities. All these are positive aspects of the culture and require independent thinking and working by staff without been closely supervised. In addition a strong commitment to organisational goals so necessary in obtaining positive results group effort. They also require strong dedication from staff at doing what hey best and the setting of very high standards. The reinforcement of these positive aspects also require with strong informed objective opinions.

 In concluding, the culture of MMB has been shown to have many facets ( both negative and positive) with the recent change process playing a significant role in determining its overall appearance. In the second part of the assignment it was shown how these various facets provide opportunities and constraints for varying leadership styles. Again it was shown that the change process in particular an its effect on the overall culture provided opportunities for certain leader styles while on the other posing a problem for other styles.

In the last part of the assignment follower-ship was looked at. It was demonstrated that with the existing cultural characteristics, the suppression of qualities supposedly possessed by effective followers could play a role in seriously determining whether the organisation was able overcome the problems been faced. According to Kelly successful leadership depends on effective followers. It was also shown that the negative aspects of the culture could be restrained if the qualities of effective followers as described by Kelly could somehow be brought to life in the staff at MMB.

At the same time aspects of the culture such as “Innovativeness”, Teamwork and “Outcome orientation” provide opportunities for the follower with the prerequisite qualities of being an effective player to play a strong role in reinforcing positive dimensions of MMB’s culture.

To what extent are HR systems such as (1) recruitment and selection, (2) performance appraisal, (3) compensation, and (4) training, used to ensure effective strategy implementation in your organisation?

Human resource management (HRM) has to do with all the “management decisions and practices that directly affect or influence the people who work for an organisation”. Human Resource (HR) systems include such components as recruitment and selection, training, performance appraisal and compensation. Setting strategic objectives and ultimately effectively implementing them, for any organisation, depend a lot on HR systems.

The approach to the question will first involve a brief look at the organisation being considered followed by its defined strategies. An examination of the different HR systems and how they ensure or do not ensure effective strategy implementation follows.

The organisation being considered is Manufacturers Merchant Bank (MMB) as it operates in the current year 1999. It provides service in areas such as funds management, foreign exchange trading  and credit. The bank has two main strategic business units - Corporate Banking (to facilitate credit extension) and Treasury and Investments. 

N.B. For the purposes of the post, particular emphasis will be placed on these two strategic business units.

Over the last three to four years, because of unstable economic conditions and new banking regulations, the bank has had to undergo tremendous change. Particularly in the area of credit,  economic conditions made the bank’s credit clients unable to meet monthly obligations. In addition, increased cash reserve requirements which meant higher interest costs to clients, further compounded the situation. The result was a massive increase in the banks bad debt portfolio with the inevitable erosion of the bank’s profitability.

The change process which commenced approximately two and half years ago, resulted in restated organisational strategy objectives. Lloyd Byars in the book, Strategic Management, Planning and Implementation, defines strategy as the steps taken by an organisation to achieve its mission and objectives with there being three levels - corporate, business unit and functional.  According to Byars, the corporate level has a longer term focus and affects the organisation as a whole while the business level is specifically concerned with the operations of a particular unit within the organisation.

MMB’s restated strategy objectives while focusing on its strategic business units were defined at the corporate level. With the given business climate, MMB used a combination of strategies. In the area of credit extension, the strategy was one of retrenchment (working out non-performing loans while developing and implementing tight credit administration policies).

In the bank’s other strategic business unit - Treasury and Investments (TI), the strategy established approximately two and half years ago, was to focus aggressively on growth. The rationale here being that the main areas of activity under TI (treasury management, foreign exchange trading, and investment management) offered substantially lower risks to the bank and additionally, were more likely to flourish given broader macro-economic policy considerations.

With these strategic objectives outlined, MMB sought to re-establish a strong financial position by deciding to focus on well defined service areas and markets. This “focus” strategy was aimed at delivering service far superior to general industry standards.

Recruitment and selection

The various HR systems identified have played a key role in effective strategy implementation. For example, the new strategic thrust which meant considerable downsizing involved recruiting and selecting personnel both internally and externally to fill key restructured positions. Recruitment and selection being defined as the process of identifying a job opening, job and market analysis and interviewing to the point of making a job offer.

The recruitment and selection process was at first aimed at identifying senior banking personnel to fill management positions in the named strategic business units. Once this process was completed, emphasis was to be placed on recruiting junior staff in those areas  based on certain criteria. 

For senior positions, apart from minimum educational qualifications, simple general criteria was involved:

Þ    Identifying persons with the right cultural orientation in maintaining high service standards; 

Þ    Identifying candidates with strong technical competence and significant relevant experience in banking.

More specifically, Corporate Banking required someone with vast credit experience to implement tight banking controls and procedures. This would have been crucial to the strategy of retrenchment.  Similarly, the TI personnel required extensive experience in the money and foreign exchange markets but also required the drive to tackle aggressive growth objectives.

The recruitment of senior banking personnel had to be carried out against the background of pressures from the regulatory bodies and from directors not wanting to have bad financial results become a part of the public’s domain. As such the entire process had to be done in an efficient manner and in the shortest time possible.

With these considerations, the recruitment and selection method used for senior personnel was very informal. This being contrary to usual formal procedures used in recruiting senior staff. Applicants were essentially past employees and people already known by senior management and directors or recommended by well respected members of the business community. This facilitated a process of automatic elimination and quick efficient identification of candidates based on criteria set. Further, the process reduced drastically the time usually spent shortlisting,  interviewing candidates and making reference checks.

With junior staff recruiting and selecting the right personnel was also critical to effective strategy implementation. While the established criteria for senior personnel applied, the emphasis was more on identifying and selecting trainable personnel. The recruitment of junior staff was more formal.

 In recruiting junior staff, employment agencies were used to source individuals with the desired qualities. This allowed at least an initial screening process by the agency. Additionally, interviews at unit level, at the executive level and by HRD provided additional screening. Reference checks revealed additional key information which turned out to be quite relevant in finalising the process.

Performance Appraisals

Performance appraisals have also been used by MMB to ensure effective Strategy implementation.  The process is defined as the systematic evaluation of an individuals performance based on job function. It extends to an evaluation of the individuals potential for development within the organisation as a whole.

 Performance appraisals are used to communicate the expectations of management on an ongoing basis. At MMB, staff are essentially appraised on set objectives and behavioural standards by immediate supervisors on a quarterly basis.. Junior staff are judged on the latter while senior staff are judged against both.

With behaviour-based performance appraisal, factors such as customer relations, ability to solve problems (especially those affecting clients), dependability and office practice and attitude make up a list of performance areas for a weighted check list. This appraisal process also allows comments from supervisors in free form essay on performance in key service areas.

Set objectives against which senior personnel are judged are first discussed with incumbent. They include volumes to be achieved in foreign exchange trading and  growth targets for the investment management portfolio. These in keeping with strategic goals.

Both the behaviour-based and result oriented performance appraisal which facilitates continuous monitoring, review and feedback ensure that staff maintain high levels of service standards and that set objectives are achieved. Both forms of appraisal ensures that problems or obstacles are dealt with in good time and that appropriate assistance is forthcoming from management if needs be.

Compensation

With aggressive growth targets for TI and high level staff required for implementation of control procedures in the area of credit administration (Corporate Banking), compensation packages have also been key to effective strategy implementation at MMB. Compensation is essentially the direct and indirect rewards to a company’s employees.

At MMB, the established form of direct reward is basic pay. Basic pay is maintained at levels comparable with industry standards ensure that MMB can compete for and retain quality personnel. Competitiveness is maintained through periodic reviews of the job market and a compulsory annual review of all staff members. Another form of direct reward is an annual incentive bonus paid to all staff members.

A prized form of indirect reward comes in the form of a fully maintained company car available only to senior managers. This form of reward along with basic pay are in keeping with industry standards and are also critical to MMB retaining its personnel. The retention of key personnel is key to strategic implementation. Additional forms of indirect rewards include pension, payment for sick leave, assigned parking spaces for senior staff, etceteras.

Other forms of compensation take the form of cash prize for employee of the quarter. The award, among other things recognises hard work, professionalism and high service standards and is limited to junior staff members. The award was introduced specifically to reinforce the qualities so critical to implementation of strategy described.

Training

Training has also been key to MMB effectively implementing its strategy. Training is defined as “an organised effort to encourage and facilitate the learning of job-related attitudes, and/or knowledge, and/or skills by employees”.

The selection and recruitment process effectively reduced the need for training for senior staff. However, considerable emphasis has been placed on training junior staff to improve on areas such as attitude, knowledge base, banking technology aimed at arming employees with the necessary ammunition to deliver the high service levels intended.

With limited resources, training often take place on the job. More specifically, research is done by selected staff on relevant banking topics and presentations done in unit meetings. This has been a regular feature over the last two and half years. In addition, management devised the concept of a quarterly quiz that would force certain levels of staff to become more conversant with banking and financial terminology and concepts and also on internal operations and procedures and regulations. Outstanding performance is rewarded with a nominal cash prize.

Job rotation is another form of training utilised at MMB. This it was thought would be very necessary to ensure that with small staff size almost every officer was conversant with the other officer’s desk. This facilitated organisational flexibility and continuity especially in times when staff went on vacation leave or were unable to attend work due to illness or other unforeseen events.

While the need for training at the management level was much reduced, there were still key areas which were identified as being very important in the bank effectively implementing its strategic objectives. For example, in the area of TI,  training in new bank funding products and more sophisticated risk management techniques for more effective treasury management were thought to be critical. This took the form of external training organised and conducted overseas by Citibank. Not only was it thought that Citibank had the expertise to deliver such training but in addition it would deliver lessons in desired organisational culture.

Also, training for the Corporate Banking senior personnel was deemed important.  A specialised course on credit management and administration was identified to help develop a better appreciation of international standards and approach to the subject area. With this, it was hoped, would come even tighter credit policy administration, more sophisticated  due diligence techniques and more conservative lending practices. Additionally it was hoped that the training would instil a more proactive approach to overall credit management.

Conclusion

In concluding, HR systems have played a very important role in effective strategy implementation at MMB. In particular, recruitment and selection played an extensive role  as with significant downsizing and restructuring appropriate staff had to be identified and brought in to ensure survival. Performance appraisal it has been shown played a very important role as with result oriented methods allowed the bank to see how it was performing against stated growth objectives. In addition, behavioural-based methods allowed management to assess key traits to ensure that qualities existed to facilitate the high levels of service promised.

Similarly, compensation has also played a big role as it has allowed MMB to attract and retain competent staff. The retention of staff being important to ensure strategy implementation. Training, it was also shown, played its part. In particular, training in well defined areas allowed the bank to establish a more flexible workforce able to deliver enhanced service to customers.

While these HR systems played a big part in strategy implementation, a number of problems were encountered. MMB, although having a Human Resource Development unit is still lacking in well designed systems. As such, the systems by not being very comprehensive, did not allow full advantage to be taken of some of their critical aspects.

For example, with recruitment and selection, less than systematic methods are used to conduct job and market analysis. This in the past has resulted in:

*        frequent job reviews arising from workflow conflicts;

*        resentment among staff as faulty job market analysis limited recruitment to external pools while more than competent personnel to perform job tasks could be found internally; and

*        improper communication of job responsibilities (poor job analysis) and remuneration not commensurate with assigned tasks which resulted in premature resignations.

With other systems such as performance appraisal, the following problem areas are evident:

  • ·        the non-existence of formal incentive schemes tied to performance objectives especially with senior positions (resulted in motivation problems with some personnel);
  • ·        lack of performance appraisal skills among supervisory staff to adequately communicate set objectives or performance standards (thus hampering effective communication of set strategy).

With compensation, the main issue has to do with the annual incentive bonus plan. When first introduced, it was intended to stimulate job performance. However, with management concerned with morale problems all staff now benefit regardless of performance. As such,  it has long been established that it is no longer a motivating tool and thus ineffective in strategy implementation.

These problem areas have been recognised as serious obstacles capable of adversely affecting strategy implementation and as a result major steps are now been taken to address them. The first line of attack is with building more expertise in the bank (HRD) through training. With recruitment and selection, proper job descriptions and specifications are now been documented. In addition, as standard procedure, internal staff considerations will be made for all job openings. Finally, there are now plans to introduce a more equitable board-approved incentive plan linked closely to actual performance. 

SOURCES

Byars, Lloyd l., 1987, Strategic Management, Planning and Implementation.

Brown, Dr Andrew, Human Resource Management, Study Guides 1, 2 & 3.

Schuler, Randall S. and Huber, Vandra L., Personnel and Human Resource Management.

Robbins Stephen P., Organisational Behaviour, Concepts, Controversies, Applications.

Assignment - Managing Organizational Change

(A) Describe a recent change in your organisation, or a specific part of it.

With the profound impact of the external forces (“triggers”) it meant widespread change was necessary in order to ensure survival. This process started with the removal of the then Managing Director and the installation of new, younger and more vibrant Chief Officer. As the “change agent” he set about putting in motion the process of renewal immediately. Almost every aspect of the banks operations required change. In the context of Harold J. Leavitt’s structure of organisational change, MMB was required to change many of its internal processes- its tasks, a substantial portion of managers and employees - its people, lines of authority and unit/department functions - its structure and its techniques and tools - its technology. These changes of course would have been easy to imagine given the interlocking nature of these dimensions.

As was mentioned, a more detailed look will be taken at technology as the force of change at MMB. It is on this force that the second part of the assignment will be centered. The section ends with a brief look at the kinds of resistance to the change coming from staff.

Trading requires a structure that facilitates speedy and efficiency processing. Typically spreads on trading volumes are low so that it is important to be able to process many transactions with the minimum of ease. As such the entire technological structure of the bank which was built around the slower paced business of Deposit-taking and On-lending had to be completely overhauled.

This process involved a detailed look at existing hardware and software and in-house competence. An assessment was the made of kinds of transactions and services that would be provided going forward and the kinds of systems that would need to be in place for support. The concept of the structure in mind was to set up an integrated  system that would essentially require a one time input of deal/transaction  information. From this point all approvals by Unit Heads, Division Heads would have been effected on the system and the cheque cutting, cashiering and documentation functions facilitated with minimum additional input of information to the system. This would significantly cut the processing time required in any transaction.

The assessment phase which required considerable participation and feedback from staff did not have the desired effect. Management none-the-less thought that the change was all important and inevitable to keep up with the new business focus and competition that had become more intense with passing time. A steering committee which included only members of the management team was set up to oversee, develop, test and implement the new technological platform. The mandate of the committee was quite clear: Develop an integrated software programme to effectively manage the banks new and chosen core products and services, and facilitate a process of reorientation while training staff to become masters of the new approach. 

As mentioned there was little feedback from lower level staff especially those who had been employed to the bank for a long time. In one on one situations staff expressed that with all the foreseeable technological changes the need for certain job functions would be made redundant with the con-committant loss of employment. Others felt that although they could see the benefits they were uncertain as to how they would fit in the new structure.

Arthur Bedian’s four common causes of resistance to change (parochial self interest, low tolerance to change, contradictory assessments and misunderstanding and lack of trust) sums up the mood at MMB at the time.

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The Administration of a Company's Fixed Assets. What are the Basic Guidelines to Follow?

The administering fixed assets acquired and sold is a key part of the management function and requires a systematic approach to ensure the accurate capture of book values of the carrying assets on the company’s balance sheet. The following is a recommended comprehensive approach.

GENERAL

Fixed assets to be acquired are detailed in terms of cost and description in the annual budget presentation. The process involves a full discussion, analysis and sign-off by the Finance and Audit Committee. The approval of the budget itself implies approval of the list of assets to be acquired during the financial year. Once an item or expenditure has been approved by the board then the actual outlay can be effected by any two authorized  signers within the bank (this is one approach).

Any item or expenditure that arises during the year must be brought to the board after review by the Finance and Audit Committee for full approval providing the amount of the outlay will exceed $****. For outlays below this amount, the review of the Finance and Audit Committee is still required but the signature of two other authorized officers will be required.

Functions

FIXED ASSETS ADMINISTRATION

-Receive and review source documents for acquisition of fixed assets (e.g. suppliers invoice, receipt slip,   etc.).  

-Ensure approval at board, Finance and Audit Committee.

N.B. There are minimum expenditure requirements for capitalization of certain classes of fixed assets. This is decided on by the Finance and Audit Committee.

-Generate Requisition/transaction Ticket/pass accounting entries.

-Assign a proper identification number and update the fixed assets register.

-Arrange for the filing of fixed assets records.

 -Pass on Transaction for cheque to be cut.

 -Send cheque along with letter to Supplier.

DISPOSAL OF FIXED  ASSETS

-Obtain approval for disposal from board or authorized signers.

-Obtain valuation if necessary.

-Generate invoice to Purchaser.

N.B. The same approval structure and signing authority applicable to the acquisition of fixed assets apply to the disposal.

-Prepare journal voucher/Transaction Ticket for disposal value.

-Receive payment and Issue receipt and Title of ownership to buyer in exchange for item.

-Update fixed assets Register.

ACCOUNTING

-Update fixed assets register and general ledger accounts by submitting fixed assets addition form from data entry.

-Check accuracy of updated computer files by obtaining the general ledger, fixed asset register and depreciation listing.

-Analyze general ledger fixed assets account and fixed asset register for errors and unusual balances.

-Prepare fixed asset Addition form for any Omissions in new assets and journal entries for any other adjustments required.

-Obtain cost, disposal value, depreciation of disposal assets and other details required to prepare necessary journal entries.

-Prepare journal entry to reflect the disposal and profit or loss on disposal in the general

RECONCILIATIONS

MONTHLY

-Ensure the posting of Depreciation entries to the appropriate general ledger accounts.

 -Obtain monthly transaction register and test check postings.

 -Agree general ledger and fixed asset balances with fixed asset register.

 -If balances do not agree, re-check postings of acquisitions, disposals, retirements, etc.

 -Report any un-reconciled differences to the authorized officers.

ANNUAL

-Ensure that the circulative general ledger fixed asset balances agree with the fixed asset register balances.

-Report any unreconciled differences to the authorized officers.

- Physically verify existence of all fixed assets appearing in the fixed asset register.

-Report any shortages to the authorized officers for necessary action.

-Report any idle/obsolete assets to the authorized officers for reviewing of depreciation rates, possible disposal, etc.

-Ensure that fixed assets are adequately covered by insurance.

Handling Cash - What are the Basic Guidelines?

If your organisation handle cash in its day to day operations, here are some simple guidelines to put in place.

1.    Cash must not be received / counted at any other point than at the cashier's counter,

2.    If staff has received cash from clients off premises, please ensure that the amount is checked with the client, the amount agreed on sealed and passed on to cashier in the same sealed condition.

3.    If cash is being passed on to cashier by staff, package must be opened and cash checked in the presence of said staff member.

4.    Transaction deadlines are to be more strictly adhered to when dealing with cash because of security issues.

5.    Money laundering guidelines must be strictly adhered to.

6.    Where staff is collecting cash from cashier on behalf of client, counting, proper sealing etc must be done in their presence.

Handling cash increases your business risk. Be safe rather tthan sorry!   

What Are The Key Elements of a Policies & Procedures Manual?

Introduction

Policies and procedures manuals are prepared for the purpose of documenting and consolidating the principles, systems and procedures applied the a business' activities.

The benefits derived from documentation of the policies and procedures include but are not limited to the following:

1. Systems and procedures are standardized

2. It's a boilerplate to building and reinforcing the company's specific way of doing things (it's culture)

3. Written procedures provide management with a readily available reference source to clarify and handle fairly procedural questions and issues

4. New employees can use the manual to acquaint themselves with the cultural practices and policies and procedures employed employed by the company.

5. It's a quick reference for existing staff executing, recording and reporting on complicated transactions

5. Manuals are especially important in regulated institutions in proving to inspectors that well-thought out procedures are in place to guide the company's activities.

Divergence From the Manual

The manual provides the necessary guidance for a company's activities and any unauthorized divergence from the policies and procedures manual are viewed seriously by senior staff charged with managing other staff and depending on the extent of the divergence and impact, can attract disciplinary action.

Authorization for divergence is possible but staff should bear in mind the common sense approach would;d be to obtain permission writing from an authorized manager and strictly speaking, should be added to the manual for the period the authorized divergence is in effect.

Business' are continuously faced with the need to react to rapid changes in its environment, its systems and procedures are constantly reviewed and updated by management. These updates will from time to time necessitate revisions to this manual, which will be submitted by the appropriate senior staff, reviewed and approved by a policies and procedures Review Committee appointed and presided over by the most senior staff on charge of operational matters or by the General Manager himself. The senior staff is then responsible for implementing the revisions once approved.

Revision procedures can be handled as follows:

For minor revisions can be highlighted by any method chosen and should clearly show sections which have been superseded by new updates. The updates can be given on the pages following.

For major revisions - If the revision requires changes to large sections of a page the affected page is typically removed and replaced by the revised page. The now obsolete page will be filed at the back of the manual under the caption “Superseded”.

Finally, the effective date of the change to the manual should be included on the revised page.

Making Manuals Available to Staff

Each copy of the company's manual should be placed in the custody of senior staff responsible for other staff be responsible for its safekeeping and care. Each manual issued has an identifying number for the purpose of control.

On no account are manuals to be removed from the company's premises except with the express approval of an authorised staff (if in doubt just ask).

What Is The Role Of The Board Of Directors?

Principal Responsibilities of the Board

The Board assumes the following six specific responsibilities to effectively lead and control the Company and the Group:-

Reviewing, approving, and adopting the Managements proposal on the strategic and investment plans and annual budget for the Group.

Overseeing the conduct of the Company's business to evaluate whether the business is being properly managed.

Identifying principal risks associated with the proposals and ensuring the implementation of appropriate systems to manage these risks.

Succession planning, including appointing, training, fixing the compensation of and where appropriate, replacing senior management

through the Human Resource Function.

Developing and implementing an investor relations programme and shareholder communications policy.

Reviewing the adequacy and the integrity of the Company’s internal control systems and management information systems, including systems for compliance with applicable laws, regulations, rules, directives and guidelines.

To establish and dissolve committees and sub-committees of Directors and Members and to determine the terms of reference and mandates of such committees;

To appoint and remunerate any accountants, solicitors or other experts or agents;

To Vote to borrow, or raise or secure the repayment of such sum or sums of money in such a manner and upon such terms and conditions in all respects as they see fit, and, in particular, by an mortgage, charge or other security on the undertaking of the whole or any part of the present and future property

To purchase, lease or otherwise acquire, alienate, sell, exchange or dispose of lands, buildings and other property, moveable or immoveable, real or personal, or any right or interest therein for such consideration and upon such terms as the Board considers reasonable.

What are the Steps Involved in Finding, Interviewing and Employing New Staff?

While most staff members will never be engaged in interviewing and employing new staff...the process of finding, interviewing and employing new staff still forms a very important of the employee handbook.

Finding New Staff

The employee manual will typically address how the search for new staff is initiated or triggered. Here are some of the typical triggers:

1. Vacancy created by a staff member leaving;

2. Vacancy created by expansion/growth;

3. Vacancy created by the need for new skills/expertise.

Approved procedure will require formal discussion and justification starting at the department level followed by discussion and approval by the company's management committee which would include the HRD head. Depending on the level of the staff member, further discussion and approval may be required at the Board level.

Searching For New Staff

Company policy may dictate first trying to fill a position internally, then externally or it may be the company's policy to advertise internally and externally at the same time. External advertising may be done by the company itself or it may do so with the help of an employment agency or it may be a combination of both.

Although a company may receive resumes on an ongoing basis, its policy may be only to consider resumes received in response to a specific ad.

Depending on level of staff, the company's policy may be to employ the services of a Head Hunter or Job Agency exclusively or in conjunction with its own efforts.

Interviewing New Staff

New staff will, ultimately, make or break a company; so companies will ensure rigid screening. The company's employee policy will typically require interviewing by the Department's manager, the HRD manager and the CEO. The interviews can be scheduled to be conducted individually or by a panel.

Some companies may have only one thorough interview or they may schedule second and third interviews to focus on certain areas, such as getting to know the applicant, discussion of job responsibilities and compensation/benefits.

For certain staff, especially higher level staff, the company's policy may be to employ a wider interview panel to include other senior executives in addition to the Department manager, the HRD head and the CEO. Some companies will also require final screening and interviewing at the board level.

As a general rule, companies employ staff strictly on the basis of qualifications and experience. This is typically clearly stated in the employee handbook.

Probation

Once staff are employed, employee policy will allow for a minimum probationary period. This is typically three months (some companies allow 6 months depending on the level of staff); during which time, the new employee is orientated in a structured way to the job and the organization.

The initial period of probation is typically subject to extension at the discretion of the company for a further period of up to a specified number of months (usually 3 months).

At the end of each probationary period, an appraisal report focused on important performance areas is prepared by the employee's supervisor and discussed with the employee. The discussion can be done by the supervisor or by a panel. A recommendation is made usually to HRD and, ultimately, to the CEO on whether or not to confirm employment or to terminate.

On the point of termination, company's will typically allow for separation of new staff and company without either one giving notice to the other during the probationary period.

Simple Guidelines For Defining and Managing Staff Working Hours

As a way of managing general productivity, it is imperative for organisations to make general policy statements on working hours, overtime, attendance and punctuality and meal time. Here are some general guidelines:

Working Hours

Of course, this will vary all over the world and will also depend on whether the firm engages in flexible working hours but the company's statement on working hours in the employee policy document will clearly indicate what the normal office hours (Monday to Friday) are.

Additionally, the company will clearly layout it's policies as regards flexitime at different staff levels.

Leaving Office Premises

As a policy rule, the general stipulation will be that during normal working hours, permission from supervisors is required to leave the work premises for reasons other than lunch.

Overtime

Overtime work can be a very contentious matter. Companies will be careful to layout clear policies as to the rate payable for overtime usually according to department, day of the week, number of hours worked and level of staff.

In addition to the rate paid, clear policy guidelines are laid down for supper/refreshment allowance according to similar elements above (department, day of the week, etc.).

Usually, overtime and meal allowances will be approved/signed off on by Department head or other assigned senior staff.

Supper Allowance is available. Approval for overtime comes from the Division

Overtime on Saturdays, Sundays and Holidays

Since Saturdays, Sundays and holidays are "sacred" for most people, companies will usually have a higher overtime rate of pay for work done on these days. For example, the company may stipulate that overtime rate is time and a half Monday to Saturday and double time on Sundays and holidays.

Attendance & Punctuality

Punctuality and attendance overtime can seriously impact a company's productivity. It's an area so important that all staff will typically have it as a part of their periodic appraisal.

Here are some typical guidelines:

- If an employee is absent or excessively late or shows a pattern of absence, the supervisor will discuss the matter with the individual privately so that the situation can be corrected. If the problem persists, then the corrective action/procedure will be followed and dismissal can result.

- If an employee is going to be late for work or absent for a day or more because of illness or any other reason, contact should be made with supervisor in good time to allow alternate arrangements.

- If an employee is absent for more than a stipulated number of days due to illness, a medical certificate must be submitted.

Meal Time

Although there are exceptions, companies will generally stipulate a one hour time frame for lunch. Usually supervisors will schedule meal times for each Department so employees will not be away at the same time.

Returning to man work stations promptly after breaks is important to accommodate other staff, maintain productivity levels, and to ensure that a high standard of customer service is maintained.

Simple Guidelines for Sending and Receiving Company Mail

Companies will want to ensure that certain general standards of grammar and presentation are maintained. Additionally, officially authorised signatories are required based on the type of correspondence/transaction. As such, companies will make definitive statements on external forms of correspondence and how they are administered. 

Signing Authority

Although there are exceptions, companies will usually insist all correspondence generated internally be signed by 2 persons...usually the author and Supervisor, usually from within the same department. If the author and Supervisor are one and the same, he/she alone should sign if the company's policy explicitly states so. Otherwise, other senior staff at the same level or higher up maybe required.

In some instances, lower level staff may be allowed to sign alone if the correspondence is not binding the firm legally or has no potential to create liability but with stipulation that such correspondence be reviewed by senior staff. 

In financial institutions, signatories for certain documents, e.g. commitment letters, letters of undertaking, guarantees, etc. will typically be in accordance with the firms lending and investment guidelines.

Where the firm has entered into an agreement with another institution and where authorized signatories have been agreed on separately made (e.g. where the firm holds an account (checking account, etc.) with another financial institution), only the specified individuals in that separate agreement, usually approved by The Company’s Board, may sign.

The company will generally mandate for all two copies of all correspondence leaving the firm should be generated and distributed as follows:

Original - Sent to client.

Copy two - Filed on client's internal file.

Extra copies may be generated if other parties are involved in the communication/agreement/transaction with each party receiving a copy and another filed to each party's internal file.

Filing

All correspondence and documentation on the firm's clients generated internally or externally must be filed immediately and appropriately.

Internal filing procedures will usually mandate how correspondence are to be filed alphabetically, by date order, confidentiality, department, type of communication/agreement/transaction, etc..

For small organisations, the filing system may be a simple set of procedures but with growth, the system is usually more complex and more effectively administered by referencing system developed around the said elements mentioned above (alphabet, date, type of communication, etc.).  

Personal Conduct: Simple Office Guidelines

Employees will want to pay particular attention to a company's statements on personal conduct. This is one area that if you slide you could be out of a job and because of the integrity issue in some instances can have lasting implications.

Here are the key elements to look out for:

Confidentiality

All companies, but especially service/financial type organisations are keen to protect client confidentiality. They normally have a strong statement insisting on all aspects of a customer's relationship being treated as confidential.

Such policies are abundantly clear on discussing/revealing client information with/to third parties (including former officers or employees) and the consequences.

Confidentiality statements only allow for certain aspects of customer's relationship to be disclosed only with the prior written consent of the customer.

Commitment & Representations

Because of the potential for liability and eventual loss, employee policies will specify clearly that no commitment, verbal or written can be communicated to any customer or potential customer of the company by any employee unless the required approval as laid out in the company's policies and procedures have been met.

Employee policy will almost in all situations require that all formal commitments by the company be signed by at least 2 signatories.

Phone, Mail & Delivery Service

Companies in their employee policy document will make it clear that the firm's mail, telephone, and delivery services should not be used for personal business except in emergencies or other unavoidable circumstances. Usually, the company will state that approval of the HRD Manager or other assigned officer is required.

Financial Matters/Conflict of Interest

A company's statement on personal conduct will insist on financial affairs not being conducted in a manner that would give even the slightest appearance of a conflict of interest or other improprieties.

A more comprehensive policy will insist that an officer of the Company must not negotiate, or otherwise be involved in, a commitment to a company owned/controlled by a relative (e.g. member of the same household, brother/sister, parents and children, and spouses thereof, etc.) or in which such persons or the employee has a significant financial interest of any kind. Such involvement constitutes a conflict of interest.

Smoking

Smoking has become almost a no no in business places and many public areas. Because of the potential for liability and generally just being good corporate citizens companies typically will not allow employees to smoke inside the office.

They can light up alone with clients and invited guests only in designated areas.

Alcoholic Beverages

Employees consuming alcoholic beverages is another huge potential liability to organisations in many different ways. The employee policy will forbid alcoholic beverages during normal work hours.

Companies will go on and insist they have the right to stop employees from working when, in their resonable estimation, work performance will be affected by an employees state of mind brought on by the suspected consumption of alcohol.


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