ORGANIZATIONAL BEHAVIOR

THE STUDY OF NIB BANK

SUBMITTED TO:

MR. AHMED RANA

SUBMITTED BY:

HAMZA MUSHTAQ NADEEM SHEHZAD IKRAM HAIDER MUHAMMAD ZEESHAN

939 955 1024 920

DATE:

15/06/2010

HAJVERY UNIVERSITY, LAHORE

ACKNOWLEDGEMENT

In the name of Allah, the most beneficent and merciful who gave us strength and Knowledge to complete this report. This report is a part of our course Organizational Behavior. This has proved to be a great experience. This report is a combine effort of Hamza Mushtaq, Nadeem Shehzad, Muhammad Zeeshan and Ikram Haider.

We would like to express our gratitude to our organizational behavior teacher Mr. Ahmed Rana, who gave us this opportunity to complete this report. We would also like to thank NIB team to help us in a deep study of their organization. They gave us many Helpful comments which helped us a lot in preparing our report.

CONTENT TABLE 1. INTRODUCTION TO COMPANY

y y y y y y

Brief History Ownership Structure Location of Office Number of Total employees Head of Administration Department Key People/ Designations of the Administration Department.

2. MISSION/ VISION STATEMENT 3. GOALS AND OBJECTIVES (SMART)

y y

Corporate Objectives Department Objectives

4. ORGANIZATIONAL ENVIRONMENT
y y

External Internal

5. ORGANIZATIONAL CHART 6. CORE COMPETENCIES 7. COMPETITIVE ADVANTAGE 8. CORE AREAS OF RESEARCH IN OB

y y y y y y y y y y y y y y

Biographical characteristics Ability( physical and intellectual) Personality and jobs Managing emotion at work Importance of attitude ,values and job satisfaction in organizations( Implications for managers) Employees motivation Team management Leadership process implications Power and politics in organization Conflict , negotiations and inter group behavior Organizational structure and designs Organizational culture Organizational change Work stress and its management

9.

RESAERCH DESIGN y y Questionnaires ( open and close ended) Interviews

10. CONCLUSIONS, RECOMMENDATIONS AND SUGESSTIONS 11. REFERENCES

12. BIBLIOGRAPHIES 13. APPENDIXES

1. INTRODUCTION TO COMPANY NIB Bank Limited started as NDLC-IFIC Bank Ltd. which was incorporated in March 2003 as a public limited company. It started operations in Oct 2003 when all assets, liabilities, rights and obligations of the former National Development Leasing Corporation (NDLC) and Pakistan operations of IFIC (International Finance Investment and Commerce Bank) were amalgamated with and into the bank with a paid up capital of PKR.1.2bn. In April 2004 the Pakistan operations of Credit Agricole Indosuez were also amalgamated with and into NIB. Towards end of Jun 2007, it acquired majority shares of PICIC with the aim of merging PICIC and its commercial banking subsidiary PICIC Commercial Bank Limited (PCBL) into NIB. The acquisition was financed through a combination of the country's largest private sector rights issue and commercial debt, with resultant increase in NIB's paid up capital to PKR 28.4 billion. Finally on December 31, 2007 after obtaining the necessary approvals from State Bank of Pakistan, NIB successfully merged its operations with those of PICIC and PCBL, hence creating the 7th largest bank in the country by virtue of branch network and asset size. NIB has almost 4900 employees. NIB business units include:
y y y y

Small Medium Enterprises and Commercial Banking Group Corporate and Investment Banking Group / Financial Institutions Consumer and Small Enterprise Group Treasury

These are supported by 10 business enabling functions. NIB is the 7th largest commercial bank in the country in terms of number of branches and now boosts an extensive branch network of 226 branches. The bank, as of September 30, 2009 has a total asset base of over PKR.189 billion, making it the 7th largest bank in terms of assets. With deposits surging over PKR 105 billion, the bank is 10th largest in terms of deposits, and has advances of PKR 96 billion. Moreover, it is also the 2nd largest bank in terms of paid up capital after Standard Chartered Pakistan. The bank has been Rated AA- (Long term) and A1+ (Short Term) by Pakistan Credit Rating Agency Limited (PACRA). In June 2005 Temasek Holdings of Singapore acquired 73% shareholding in NIB Bank, through Bugis Investments. This holding has declined post merger to 63%. Temasek Holdings is an investment company owned by the government of Singapore.

1.1 MANAGEMENT PROFILE

y y y y y

Chairman: Francis Andrew Rozario President: Khawaja Iqbal Hassan Corporate & Investment Banking Group Head (CIBG): Habib Yousuf Treasury and Capital Markets Group Head (TCMG): Shah Miftaah Ul Azim Azmi Head of Small Medium Enterprises and Commercial Business Group Head (SMEC): Masood Tyabji Head of Salaam Banking: Faisal Chishti Head of Retail Bank: Salman Naqvi Internal Audit Group Head (IAG): Najeeb Gilani Compliance & Operational Risk Group Head (CORG): Faraz Haider Head of Operations Group: Nauman Hussain Strategy, Planning & Alignment Group (SPAG): Yameen Kerai Human Capital Optimization Group Head (HCOG): Shakeel Pal Finance, Accounting & Business Analytics Group Head (FABG): Rayomond Kotwal Chief Information Officer - Information Technology: Mary James Head of Customer Experience & Service Quality: Aurangzeb Afridi

y y y y y y y y

y y

Board of directors: y y y y y y Syed Aamir Zahidi Tejpal Singh Hora Asif Jooma Muhammad Abdullah Yusuf Teo Cheng San, Roland Najmus Saquib Hameed

1.2 BRANCH NETWORK AND HEAD OFFICE LOCATION NIB bank is operating in almost every big city of Pakistan. It has branches in 59 major regions of Pakistan which make it accessible for every individual and businesses to start banking relations with the bank. The head office is located at Karachi. The complete address is: 2nd floor, Muhammadi House, I. I. Chundrigar Road, P.O. Box No.6942, Karachi. Toll Free Number: 0800-00039 UAN: 021-111-333-111 FAX: 021-2417503, 2410946 EMAIL: info@nibpk.com URL: http://www.nibpk.com/

2. MISSION/ VISION STATEMENT Mission: To improve the quality of life for millions Vision: To be the most admired Financial Institution in Pakistan Values: y PASSION y RESPECT y INTEGRITY y EXCELLENCE y FAIRNESS

3. GOALS AND OBJECTIVES (SMART) Corporate governance y y y The financial statements prepared by the management of the Bank present fairly its state of affairs, the result of its operations, cash flows and changes in equity. Proper books of account of the Bank have been maintained. Accounting policies have been consistently applied in the preparation of financial statements and accounting estimates are based on reasonable and prudent assessments. International Accounting Standards, as applicable in Pakistan, have been followed in the preparation of financial statements. There are no doubts upon the Bank's ability to continue as a going concern. There has been no material departure from the best practices of corporate governance as detailed in the listing regulations of the stock exchanges of Pakistan. There are no statutory payments on account of taxes, duties, levies and charges which are outstanding, except as disclosed in the financial statements.

y y y y

4. ORGANIZATIONAL ENVIRONMENT External Environment: If we talk about the external approach, NIB bank is focused on; y y y y y External Customers Valued product and services Customer retention Increased customer base Profitability and growth

Internal Environment: Talking about the internal approach adopted by the bank NIB, is focused on; y y y Bank its people and processes Efficiency and effectiveness in all aspects Profitability and growth

5. ORGANIZATIONAL CHART

6. CORE COMPETENCIES There are few areas which are the core competencies of the NIB bank. y y y y y y y Management Team Customer relationship management Minimization of working capital Value creation Technology User friendly software Competitive environment

7. COMPETITIVE ADVANTAGE Core competencies of any firm help them to gain fair competitive advantage over its competitors. NIB bank has certainly made its place in past 7 years and gave a tough time to its competitors. Day by day, NIB is growing its assets and customers as well. The deposits ratio is also increased in past two years. The main reason of this growth can be said, relying on different factors like; the managing people are very effective and have skills to organize the functions and operations of the organization with great proficiency. Thats why the team of NIB is providing a remarkable output to its organization. The NIB is pretty much concerned about the relationship with its customers. The staff is always helpful and solves the problems of customers in no time. Similarly they create value for their customers by creating differentiation in their services in comparison to other banks. The banks motive is to provide satisfaction to all of its customers. In recent years, it is quiet noticeable that banks started to implement latest technology to decrease the supply chain and get rid of several expenses like stationary and others. NIB bank is not behind them, as most of the shares are held by Temasek Holdings of Singapore, so they have made surprisingly changes in the organization regarding technology. In result, NIB is able to cut its expenses to a huge extent. The environment of the bank branches is also a friendly type. Each customer is greeted and asked for support. They staff guides them to their desired counter. For employees, there are set targets which they have to achieve. There are strict parameters to ensure the quality of work is being done. The above mentioned factors make the NIB bank a successful bank and to have a competitive edge, which they are enjoying as growth every year.

This chart of growth will really help to understand that how much progress NIB is making against its core competencies.

8. CORE AREAS OF RESEARCH This research involves the interview with the Branch manager. We asked a series of question to them and in result collected the information under following headings. 8.1 Biographical characteristics The biographical factors have a great affect over job design and job posting. When an individual mail his/her resume, it has all the information regarding his skills, education, extracurricular activities and his/her past experiences. We only short list those candidates who meet our set criteria. For example, if we have a vacancy for BOM then obviously we will go for that candidate who has a MBA or M.com degree and has at least 5 year experience in the banking sector. We will not select those candidates or even short list them when he/she dont have such characteristics which make him/her deserving for the job. 8.2 Ability (physical and intellectual) In our organization, most of the work requires intellectual ability for the successful execution of the work. If a person who is mentally fit and can handle the stress of the work then we are able to hire him on the post for which he may be capable. As most of the situations occur, requires good and sensible decisions to be made. In the financial institution like NIB, a responsible behavior is highly needed. 8.3 Personality and jobs Finding a career that best fits your personality profile may be a factor to consider when thinking about professional success. Far too often, people start out on career paths for the wrong reasons: direction by well-meaning parents or teachers, taking a job "while they figure out what they want to do" and never moving on, for example. People who excel in their careers are usually highly motivated and energized by their jobs. They wake up in the morning eager to get to work because their career lets them take advantage of the natural preferences and strengths of their personality. Their job is not a chore to be endured but a vehicle to exercise their talents. They achieve the most important of things in job satisfaction: "a fit" with who they are. Therefore, it is our sole duty to hire a person on that job which fits their personality in all ways. If he likes to meet people and have high energy of persuasion, then we will hire him on the marketing post which includes attracting new customers to the organization. Also for convincing potential corporate world to join NIB for the better services they can ever have.

8.4 Managing emotion at work The management is highly concerned about managing emotions at work. As the job responsibility is higher, so the irregularity of unwanted emotions can be destructive. Being aware of the results, the employees are properly trained and motivated to get over their emotions successfully. In case of management, no manager will be able to control unless he is well aware of the emotional conditions of his staff and respond to them. Similarly, managers cant hold their staffs emotions unless they have a full control on their own. 8.5 Importance of attitude, values and job satisfaction in organizations (Implications for managers) A positive and understanding attitude of managers is required. We, as an organization believe that the positive attitudes of managers towards their staff will enable us to motivate them and get desired results. When a manager with rash attitude and giving no value and ease to the staff, it is obvious that the staff will not work as efficient as their job required, which will lead the organization to a chaos. Therefore, to ensure that employees have no problems in their working environment, our organization has a monthly audit system. This audit provides the feedback of the current condition in any branch, thus organization takes necessary measures if the things are going reverse. 8.6 Employees motivation We asked the question related to rewards that how rewards motivate employees in NIB Bank and we found that there are different kinds of rewards NIB Bank gives to their employees which are as follows: y y y y y y Cash Bonuses Promotions Make team leader ESOP (Employee stock ownership plans) Increment in salaries Allowances like (Fuel allowance, mobile allowance)

We found one very different kind of reward in NIB Bank that they motivate their employees whose performance is not up to the mark by giving them the salaries equivalent to the market value of the any other employee of same rank so as to motivate their employee.

8.7 Team management We try hard to make up such teams which help in obtaining organizational goal. The managers are a kind of role models; if they are doing right then obviously the other employees will do right. Mangers are solely responsible to ensure that their team is working well or not. Managers are very helping in our organization. They take care of the all situations which are occurring in the branch. They properly guide their staff time to time. Their behavior needs to be positive regardless of their feelings. Managers are properly trained with the passage of time and this surely help in regulating the daily business in an efficient way. 8.8 Leadership process implications The leadership styles are very supportive and kind of target oriented. All employees have certain tasks and targets which they have to attain. Sometimes, there are critical conditions in which some individuals are not able to obtain their targets due to different reason then the managers help them and find out solutions for that particular situation, together. 8.9 Power and politics in organization In case of power, every individual has a capacity to make decisions, but to some extent. Without any appropriate instructions from top level management, no one can make decisions on our own. We are bound to strict policies of the organization. Secondly, I dont think there is any role of politics in our organization as it is not necessary in the financial institution like NIB bank. 8.10 Conflict, negotiations and inter group behavior The conflicts arent open and there may be few, but in most of the cases conflicts dont happen too frequently. If someone thinks that he is not treated well or awarded well according to his performances: there is a channel or feedback system, employees are free to submit their problems and top level managers take actions on that problems. There is no jeopardy sort of conflict which requires negotiations to much extent, but it the duty of the managers to keep an eye on the employees that what is happening between them and take appropriate action according to the situation. If the things got worse, managers have to play a role of negotiator. 8.11 Organizational structure and designs The organization is following the tall structure and is totally centralized. However, some decision power is given to the managers. For example, the can grant loans up to a defined limit.

8.12 Organizational culture Since organization is a result of mergers and acquisitions, so it follows a mix culture. It is centralized and has to follow the policies in any case. It is also target and task oriented plus the culture is highly supportive for the employees as well as for customers 8.13 Organizational change Organization is followed by many changes since it was founded. There were mergers and acquisitions, technological changes, implementation of new systems, merging employees of more than two organizations thus resulting in overlapping culture. Although it was difficult for the management but they managed it with their extraordinary skill, and by proper communication with the employees. The management played a role of a guider and full support was provided by them. The employees were taught that these changes are helpful for the growth of their careers.

8.14 Work stress and its management NIB recognizes its employees as individuals and respects their responsibilities to the outer world. We have set criteria to monitor the efficiency of the work being done by the employees. We provide the work load to a particular employee as much he/she can handle. The employee also trained to set them according to situation, for example, they know that in the start of month the work load will be higher and it will decrease gradually. Secondly, we dont exactly organize any extracurricular activities for the employees. However, considering social responsibility as an intimacy tool, we organize different event, for example last year we organized an event named Hum saaf, sab saaf.

9. RESAERCH DESIGN

Interview: The following set of questions helped us to acquire the information provided above: 1. How biographical characteristics affect on job posting and design? 2. Is there any job and personality analysis, while you hire employees? 3. What is the importance of managing emotions at work in your organization? 4. How physical and intellectual ability affect the job? 5. What is the importance of attitudes and values of staff to a manager? 6. What are the techniques you are using to motivate your employees? 7. How leaders treat with their team members? 8. How leaders manage their teams? 9. Is there any power role of the employees in the organization? 10. What sort of politics is there in your organization? 11. Are there any conflicts? 12. Who manages conflicts? 13. Who plays a role of negotiator to handle the conflicts? 14. What type of culture you do have in your organization? 15. What are your core competencies? 16. What are your training procedures? 17. How you manage change in your organization? 18. What is the stress of work for your employees? 19. How you manage the stress? 20. What authority one enjoys in your organization?

Questionnaire: Here is the set of questions which we asked to the employees to complete our analysis report. 1) Are you satisfied with the pay roll? 2) Are you satisfied with the current reward system? 3) Are you satisfied with the work load? 4) Are you properly told about your tasks? 5) Are you satisfied with the attitude of the manager? 6) Do managers support you when there is any problem? 7) Are you satisfied with the current evaluation criteria? 8) Are you recognized as the individuals? 9) Is the bank flexible with your family responsibilities? 10) Are there time to time training programs, offered to you from organization?

Results of the survey:

Question 1:

Out of 100%
90 80 70 60 50 40 30 20 10 0 Yes No

Question 2:

Out of 100%
70 60 50 40 30 20 10 0 Yes No

Question 3:

Out of 100%
100 90 80 70 60 50 40 30 20 10 0 Yes No

Question 4:

Out of 100%
80 70 60 50 40 30 20 10 0 Yes No

Question 5:

Out of 100%
120 100 80 60 40 20 0 Yes No

Question 6:

Out of 100%
120 100 80 60 40 20 0 Yes No

Question 7:

Out of 100%
90 80 70 60 50 40 30 20 10 0 Yes No

Question 8:

Out of 100%
70 60 50 40 30 20 10 0 Yes No

Question 9:

Out of 100%
90 80 70 60 50 40 30 20 10 0 Yes No

Question 10:

Out of 100%
120 100 80 60 40 20 0 Yes No

Overall, the satisfaction of employees is 82%, which is a good sign. This is why the NIB bank is growing rapidly, and making progress in every field of day to day banking.

10. CONCLUSION By studying various areas of the organization, we concluded that overall the organization is practicing OB strategies. y Their focus is on growth and all the employees are assigned with the targets to accomplish success for the organization and to sustain this growth. The speed with which the NIB is growing, no doubt, it will sooner be a leading bank of Pakistan. The employees placement on the jobs is quiet remarkable. They assess the personality and then select the employee on that post for which he is capable. The training and motivational steps are also good and different from the other banks operating in Pakistan. The pay plan for less productive workers, the company motivate their employees whose performance is not up to the mark by giving them the salaries equivalent to the market value of the any other employee of same rank. The management styles we found are supportive and participative. The culture of the organization is mixed of many cultures. They respect the employees emotions and support them whenever there is problem. Also, the culture we can say is task oriented. Although, the organization is centralized but still the role of management is great to handle and control organizational resources efficiently and effectively.

y y

11. RECOMMENDATIONS: y NIB Bank should offer training and development sessions for undergraduates; this will help NIB Bank in future while recruiting employees. NIB should introduce Dress-Down day i.e. employees should be given permission to wear dresses other than formal dresses on certain days so as to make them relaxed while work. There should be empowerment of employees to participate more in the decision process. NIB Bank should arrange extracurricular activities like cricket matches on interbank level to further improve relations between employees as other organizations are organizing (for example ABN Amro, Mobilink, etc.) The stress management criteria is found weak, they should take measure before the employees become boredom.