Lunar International College

School of Graduate Studies

DEPARTMENT OF MANAGEMENT

MBA Program

Course Title: Human Resource Management

Assessment of Human Resource

Management Practice in Coopertive Bank of Oromia SC

List of Group members……………………………. ID No……….

1.Shiferaw Kumbi
2.Ermias Hailu
3.XXXXXXX
4.XXXXXX
5.XXXXXX
6.XXXXXXX

Submitted to: XXXXXXXXXXXXXXXXXX

January 2023

Addis Ababa, Ethiopia

 Assessment of Human Resource Management Practice

Contents
CHAPTER ONE. .......................................................................................Error! Bookmark not defined.

1. Introduction ...........................................................................................Error! Bookmark not defined.

1.1. Background of the Study ...............................................................................................................1

1.1.1. Importance of HRM Practices ..................................................Error! Bookmark not defined.

1.1.2. Types of HRM Practices ..........................................................Error! Bookmark not defined.

1.1.3. Impact of HRM Practices on Organizational Performance ........Error! Bookmark not defined.

1.1.4. Research on HRM Practices ....................................................Error! Bookmark not defined.

1.2. Background of the Company ..........................................................Error! Bookmark not defined.

1.2.1. Banking Products and Services ...............................................Error! Bookmark not defined.

1.2.2. Security and Safety ..................................................................Error! Bookmark not defined.

1.2.3. Innovative Technology .............................................................Error! Bookmark not defined.

1.2.4. Corporate Responsibility ..........................................................Error! Bookmark not defined.

1.3. Mission and Vision of the Bank .......................................................Error! Bookmark not defined.

1.3.1. Mission of the Bank ..................................................................Error! Bookmark not defined.

1.3.2. Vision of the Bank ....................................................................Error! Bookmark not defined.

CHAPTER-TWO .......................................................................................Error! Bookmark not defined.

2. Methodologies used to assess the HRM Practices of Cooperative Bank of Oromia SC ............... Error!
Bookmark not defined.

CHAPTER -THREE ..................................................................................Error! Bookmark not defined.

3. HRM Practice in Cooperative Bank of Oromia SC .................................Error! Bookmark not defined.

3.1. Introduction.....................................................................................Error! Bookmark not defined.

3.2. Types of HRM Practices .................................................................Error! Bookmark not defined.

3.2.1. Recruiting & Selection ..............................................................Error! Bookmark not defined.

3.2.2. Training & Development ...........................................................Error! Bookmark not defined.

3.2.3. Performance Management .......................................................Error! Bookmark not defined.

3.2.4. Compensation & Benefits .........................................................Error! Bookmark not defined.

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 Assessment of Human Resource Management Practice

3.3. Challenges in HRM.........................................................................Error! Bookmark not defined.

3.4. Strategies for Improving HRM Practices in Cooperative Bank of Oromia SC Error! Bookmark not
defined.

CHAPTER - FOUR ...................................................................................Error! Bookmark not defined.

4. Job analysis practice in Cooperative Bank of Oromia SC......................Error! Bookmark not defined.

4.1. Job Description Document..............................................................Error! Bookmark not defined.

4.2. Job Specification Document ...........................................................Error! Bookmark not defined.

4.3. Job Evaluation Process ..................................................................Error! Bookmark not defined.

CHAPTER - FIVE......................................................................................Error! Bookmark not defined.

5. Conclusion and recommendation ..........................................................Error! Bookmark not defined.

5.1. Assessment Results .......................................................................Error! Bookmark not defined.

5.2. Conclusion .....................................................................................Error! Bookmark not defined.

5.3. Recommendations..........................................................................Error! Bookmark not defined.

References ...............................................................................................Error! Bookmark not defined.

Annex .......................................................................................................Error! Bookmark not defined.

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 Assessment of Human Resource Management Practice

1. The role of the Board of Directors from strategy Formulation to Evaluation

The board of directors plays a crucial role in guiding an organization through the entire strategic
management process, from formulation to evaluation. In the initial stage of strategy formulation, the board
is responsible for providing oversight and direction to the executive team. They participate in the
identification and assessment of the organization's mission, vision, and values, helping to set the overall
strategic direction. The board brings diverse perspectives and expertise, ensuring that strategic decisions
align with the organization's long-term goals and interests. Additionally, they play a key role in approving
major strategic initiatives, such as mergers and acquisitions, capital investments, and changes in business
focus. Effective communication between the board and management is essential during this phase to ensure
alignment and commitment to the chosen strategic direction.

As the strategy is implemented, the board continues to exercise its oversight role, monitoring the progress
of strategic initiatives and evaluating their impact on organizational performance. Regular reviews and
updates on key performance indicators, financial metrics, and risk assessments are essential for the board
to stay informed and make informed decisions. The board also provides guidance and support to the
executive team, helping to navigate unforeseen challenges and adapt the strategy as needed. In the
evaluation phase, the board assesses the outcomes of the strategy, comparing actual results to the intended
objectives. This evaluation process allows the board to identify lessons learned, areas for improvement,
and adjustments needed for future strategic planning cycles. Overall, the board of directors serves as a
critical link between shareholders and management, ensuring strategic decisions align with the
organization's mission and contribute to its long-term success. In general, the role of the Board of Directors
is crucial at various stages of the strategic management process, from formulation to evaluation. Here's an
overview of their involvement in each phase:

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 Assessment of Human Resource Management Practice

1.1.Setting the Vision and Mission:

➢ The board plays a key role in defining the organization's vision and mission,
providing the foundational elements for strategy formulation.
➢ They articulate the purpose and long-term objectives of the company.
1.2.Approving Strategic Goals:
1.Strategic Formulation

➢ The board approves the strategic goals and objectives proposed by the executive
leadership.
➢ They ensure alignment with the company's mission and assess the feasibility of the
proposed strategies.
1.3.Resource Allocation:
➢ The board is responsible for approving budgetary allocations and resource
distribution to support strategic initiatives.
➢ They oversee the allocation of financial, human, and technological resources to
ensure strategic goals are adequately resourced.

2.1 Leadership Oversight:

➢ The board appoints and oversees the executive leadership responsible for
implementing the strategic plan.
➢ They ensure that the management team is capable and aligned with the strategic
2.Strategy Implementation:

objectives.
2.2 Risk Management:
➢ Boards are involved in risk oversight, identifying potential risks associated with the
chosen strategies.
➢ They work with the executive team to develop risk mitigation strategies.
2.3 Monitoring Progress:
➢ The board monitors the progress of strategy implementation through regular updates
from the executive team.
➢ They may conduct periodic reviews to ensure that the organization is on track to
achieve its strategic objectives.

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 Assessment of Human Resource Management Practice

3.1.Performance Metrics:
➢ The board establishes key performance indicators (KPIs) and metrics to measure the
success of strategic initiatives.
➢ They review and assess performance against these benchmarks.

3.2.Feedback and Adaptation:

➢ Boards collect feedback from internal and external stakeholders to assess the
effectiveness of the strategies.
➢ They may recommend adjustments to the strategic plan based on changing
3.Strategy Evaluation:

circumstances or emerging opportunities and challenges.

3.3.Accountability:
➢ The board holds the executive leadership accountable for the outcomes of the
strategic initiatives.
➢ They ensure that the organization learns from both successes and failures, fostering
a culture of continuous improvement.

3.4.External Relations:
➢ Boards often engage with shareholders, regulators, and other external stakeholders
to communicate the organization's strategic direction.
➢ They address concerns, provide transparency, and build confidence in the strategic
decisions made by the company.

In summary, the board of directors plays a critical role in shaping, overseeing, and evaluating the
strategic direction of an organization. Their involvement helps ensure that strategic decisions align with
the organization's mission, are effectively implemented, and adapt to the evolving business
environment.

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 Assessment of Human Resource Management Practice

2. Advantage and Disadvantage of strategic partnering, joint venture, partnership,

and Strategic Alliances
Strategic partnering, joint ventures, partnerships, and strategic alliances are various collaborative business
arrangements that organizations enter into to achieve mutual benefits. Strategic partnering involves forming
long-term relationships with external entities, such as suppliers or distributors, to enhance capabilities and
gain a competitive advantage. The advantage of strategic partnering lies in the pooling of resources and
expertise, allowing each partner to leverage the strengths of the other. This collaboration fosters innovation,
accelerates market entry, and enhances efficiency. However, disadvantages may include challenges in
aligning goals, potential conflicts of interest, and the need for effective communication and coordination.
A joint venture is a more formal collaboration where two or more organizations create a separate legal
entity to pursue a specific business objective. The advantage of joint ventures is the sharing of risks, costs,
and responsibilities, enabling companies to enter new markets or undertake large projects. Joint ventures
also facilitate access to the local knowledge and expertise of the partner. On the downside, joint ventures
can face complexities in decision-making, potential cultural clashes between partners, and the need for a
well-defined exit strategy to manage the termination of the joint venture.
Partnerships involve a collaborative relationship between two or more entities, where they work together
on specific projects or business activities. The advantages of partnerships include increased flexibility,
cost-sharing, and the ability to tap into each other's networks. However, challenges may arise in terms of
coordination, potential conflicts of interest, and the need for clear agreements to manage expectations and
responsibilities.
Strategic alliances encompass a broader spectrum of collaborative relationships, including partnerships,
joint ventures, and other cooperative arrangements. Advantages of strategic alliances include risk
mitigation, resource sharing, and the ability to capitalize on complementary strengths. They foster
innovation and speed up time-to-market. Disadvantages may include challenges in managing diverse
partnerships, potential loss of control over certain aspects, and the need for effective communication and
trust-building among partners.

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1.1.Advantages:
➢ Access to Resources and Expertise: Strategic partnering allows organizations to
leverage each other's resources, skills, and expertise.
➢ Risk Sharing: Partners can share the risks associated with new ventures, reducing
the financial burden on individual entities.
1.Strategic Partnering

➢ Market Expansion: Partnerships enable companies to enter new markets or expand

their presence in existing markets through shared efforts.
1.2.Disadvantages:
➢ Dependency: There is a risk of becoming too dependent on the partner, which may
limit flexibility and autonomy.
➢ Conflict of Interest: Differing priorities or goals between partners may lead to
conflicts.
➢ Coordination Challenges: Managing the coordination of activities between
partners can be complex and time-consuming.

2.1.Advantages:
➢ Risk and Cost Sharing: Similar to strategic partnering, joint ventures allow for
shared risks and costs associated with a particular project or venture.
➢ Local Expertise: Joint ventures provide access to the local market expertise of the
partner, especially in international ventures.
➢ Synergy: Combining the strengths of different partners can create synergies that
2. Joint Venture

enhance overall performance.

2.2.Disadvantages:
➢ Control Issues: Decision-making can be challenging when partners have different
visions or priorities, leading to potential conflicts.
➢ Shared Profits: Profits must be shared with the partner, potentially reducing the
overall financial gain for each party.
➢ Potential for Misalignment: Differences in corporate culture and strategic
objectives may lead to misalignment within the joint venture.

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 Assessment of Human Resource Management Practice

3.1.Advantages:
➢ Flexibility: Partnerships can be more flexible in terms of structure and duration
compared to formal joint ventures.
➢ Cost Efficiency: Sharing certain costs and resources can lead to increased cost
efficiency.
➢ Complementary Skills: Partnerships allow organizations to collaborate with others
3.Partnership

possessing complementary skills and capabilities.

3.2.Disadvantages:
➢ Limited Integration: Partnerships may not allow for as deep integration as joint
ventures, potentially limiting synergies.
➢ Potential for Conflict: Misalignment in goals or strategies can lead to conflicts
between partners.
➢ Dependency: Like in strategic partnering, there is a risk of dependency on the
partner.

4.1.Advantages:
➢ Risk Mitigation: Sharing risks and resources helps mitigate uncertainties
associated with strategic initiatives.
➢ Innovation: Alliances can foster innovation through the exchange of ideas and
technologies.
4. Strategic Alliances:

➢ Global Expansion: Strategic alliances facilitate global expansion by leveraging

partners' local market knowledge.
4.2.Disadvantages:
➢ Complexity: Managing complex relationships and coordination across different
organizations can be challenging.
➢ Cultural Differences: Differences in corporate culture and values may create
challenges in aligning strategies.
➢ Dependency: There is a risk of becoming dependent on the partner, potentially
limiting independence.

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 Assessment of Human Resource Management Practice

In summary, the choice between strategic partnering, joint ventures, partnerships, or strategic alliances
depends on the specific goals, resources, and context of the organizations involved. Each option comes
with its own set of advantages and disadvantages that need to be carefully considered in the strategic
decision-making process.

3. Relationship between Business Ethics and Strategic Management

The relationship between business ethics and strategic management is integral and crucial for the long-term
success and sustainability of an organization. Business ethics refers to the principles and values that guide
the behaviour of individuals and organizations in the business environment, emphasizing integrity, honesty,
transparency, and responsibility. On the other hand, strategic management involves the formulation,
implementation, and evaluation of long-term plans and actions to achieve organizational goals and
objectives. These two concepts are interlinked and can and should go together for several reasons.
Firstly, ethical considerations are essential in the strategic decision-making process. Strategic management
involves making choices that affect various stakeholders, including employees, customers, suppliers, and
the community. Ethical decision-making ensures that these choices are aligned with moral principles and
social norms, contributing to the overall reputation and trustworthiness of the organization.
Secondly, ethical behaviour is increasingly becoming a critical component of corporate reputation, and a
positive reputation can be a strategic asset. Consumers and investors are more inclined to engage with
organizations that demonstrate a commitment to ethical practices. Integrating ethics into strategic
management can enhance the brand image, build customer loyalty, and attract socially responsible
investors, ultimately contributing to long-term success.
Furthermore, ethical conduct within an organization fosters a positive corporate culture, promoting
employee engagement, satisfaction, and productivity. Employees who believe in the ethical values of their
organization are more likely to contribute positively to strategic initiatives, enhancing the overall
effectiveness of strategic management.
However, challenges may arise when there is a perceived conflict between short-term financial gains and
long-term ethical considerations. Striking a balance between profitability and ethical behaviour can be
complex, but it is essential for sustainable success. Organizations that prioritize business ethics in their
strategic management are better positioned to navigate the complexities of the business environment, build
trust with stakeholders, and adapt to changing societal expectations.

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In conclusion, business ethics and strategic management are intertwined, and they can and should coexist.
Integrating ethical considerations into strategic decision-making not only aligns an organization with
societal expectations but also contributes to long-term success by building trust, enhancing reputation, and
fostering a positive corporate culture. Ultimately, a commitment to ethical behaviour is a strategic
advantage that benefits both the organization and its stakeholders.
Aspect Business Ethics Strategic Management
Principles and values guiding Formulation, implementation, and
Definition behavior in business. evaluation of long-term plans for
organizational goals.
Ethical considerations are integrated Involves making choices impacting
Alignment into decision-making. stakeholders and organizational
direction.
Focuses on the impact of decisions Considers the interests of employees,
Stakeholder Impact on various stakeholders. customers, investors, and the
community.
A positive ethical reputation is a Corporate reputation is vital for
Reputational Impact strategic asset. strategic success.
Employee Ethical conduct fosters a positive Positive culture enhances employee
Engagement corporate culture. engagement and productivity.
Long-Term Success Ethical behavior contributes to long- Strategic management aims for
term organizational success. sustainable success over the long term.
May face challenges in balancing Balances profitability with ethical
Balancing Priorities short-term gains with long-term considerations.
ethics.
Trust and Builds trust with stakeholders, Trust is crucial for successful
Stakeholder including customers and investors. stakeholder relationships.
Relationships
Ethical organizations are better Adaptability is crucial in strategic
Adaptability positioned to adapt to changing management to navigate the business
expectations. environment.

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