MGT-210

BRAC BANK

Developed For:
Ms. Nasira Siddika (NSd) Sec: 10 Date of Submission: 06/08/2010 NORTH SOUTH UNIVERSITY

Developed By:

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• Ahasanul Azim • 092-0028-030 • Avijit Kumar Paul • 091-0960-030 • Nazmus Sakib • 091-0866-030 • S. M. Safran • 091-0198-030

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Acknowledgement
To complete our project, first of all our team is very grateful to Almighty Allah for the hard work, dedication, team effort and patience we put to finish our project work on time. The team would like to thank the official website of „BRAC Bank‟ from where we took the information, some of our relatives, friends and the respected officials of the bank who had helped us a lot by providing necessary information to complete the project successfully. Information on their site helped and supported us a lot and without it we could not complete the project properly. We also like to thank our team members as all of them devoted their full support and cooperation and gave valuable time to the project work. Finally we are very grateful to our course instructor “Ms. Nasira Siddika” who inspired and suggested us to do the project, and helped us in every possible way. The team is very thankful to her and honors to have “Ms. Nasira Siddika” as an instructor.

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working on this topic was very interesting and we have explored something remarkable through our project. School of Business North South University Sub: Letter of Transmittal Respected Mam. ___________________________________________________________________ Safran Avijit Azim Sakib ©Page 4 . Our topic is “How the management system is applied in ‘BRAC Bank” We think that. We are glad to have the opportunity to work on this project. It is indeed a great pleasure to have the opportunity to submit the project paper. We hope that. Nasira Siddika (NSd) Faculty Member. Sincerely. you would be king enough to accept our project and bless us. We have prepared this project report in accordance with the instructions given by you. 2010 Ms. all of our works have been done according to your guidelines. This project paper has provided us learning opportunity and compares theoretical knowledge with practical situation. So. This project is to describe our observation. learning and recommendation based on the knowledge and experience gained during the course.August 06.

Table of Contents Contents: Executive Summary A Brief Introduction Organization Structure Management Leadership Human Resource Management Corporate Social Responsibility Problems and Solutions Page Number: 06 07 08-10 11-15 16-17 18-24 25-28 28-29 ©Page 5 .

©Page 6 . employees. They help in the public health sector and also help to protect the environment for the general people. This facility is also taking part in the advance ways of banking in our country. CSR is integrated in the DNA of all the activities of BRAC Bank Ltd. BRAC Bank not only works for their banking sector but also work for the society. But SMEs have strong role to play to build a country economy especially for developing countries like Bangladesh. BRAC Bank Limited is using the online banking system in their banking sector as a sheer strength for their business which helps in corporate world. BRAC Bank also provides better service to customers at a very minimum price.Executive Summary Since the inception. They use the best technology and skilled human resource to provide customer quality services and always tries to balance between interest rate on FDR and Loan. BRAC Bank now is in the 5th position in terms of profit and fund management. BRAC Bank started its business in 2001 with a clear vision to work as a catalyst for the vibrant yet unbanked SME sector in Bangladesh. Online banking is a new dimension in this era of revolution of information technology and the Internet technology has added a new ripple in the wave of automation of the service delivery system. The Bank operates under a “Triple bottom Line” agenda where profit and social responsibility go hand in hand as it strives towards a poverty free and enlightened Bangladesh. shareholders while serving the greater purpose of sustainable development. They are also providing their customer Debit card facility and increasing ATM booth which is much needed for the people in Bangladesh. In Bangladesh SMEs do not get the same access to banks and financial institution as big companies do. BRAC Bank Ltd has undertaken various steps in preserving and promoting the interests of its customers.

The Bank focused on relationship based Banking. ©Page 7 . This focus makes the Bank to emphasize more on to explore and access market opportunities as well as build asset base to its clients conforming significant contribution to the profitability of the Bank. 1991 and incorporated as a public company limited by shares on May 20. a scheduled commercial Bank established under the Banking Company Act. BRAC Bank has embarked with an avowed policy to provide "Best-in-the-class" services to its diverse range of customers spread across the country based on latest information technology. as it believes that the pursuit of profit and developmental goals are mutually reinforcing. The Bank has started its operation on 4th of July 2001 with a vision to be the market leader through providing all kinds of banking services suitable to the dynamic demands of both business and individual in the competitive market. To keep in tied with its sponsor. 1999 under the Companies Act 1994 in Bangladesh. the Bank endeavors to provide mass financing especially to focus on under-served enterprises across the rural and urban area. BRAC Bank is now currently ranked in 5th position in terms of profit and fund management.A Brief Introduction BRAC Bank Limited. BRAC Bank's goals.

BRAC Bank Limited • Organization Structure ©Page 8 .

Board of Directors ©Page 9 .

Management Committee ©Page 10 .

BRAC Bank Limited • Management ©Page 11 .

to expand their market. 4. Become Market Leader: Strategic planning includes long term vision of BRAC Bank which is to be the market leader in terms of profit and fund management within 2012. to increase their fund. Moulobhi Bazar in Sylhet. BRAC Bank has a very pragmatic tactical planning. They are doing necessary research and taking steps. They will open at least 10 branches every year. Loan Pricing: Following the standard set by Bangladesh Bank. To improve the customer care officers. BRAC Bank is going to open 10 branches this year in the most suitable locations in Bangladesh such as Gazipur. 2. This year they are planning to invest in the shipping sector of the country which will generate a very handsome profit. Market Expansion: BRAC Bank plans to expand its market by opening new branches in the most suitable locations. To become the leading Bank of Bangladesh. They are planning to open their branches in these countries within the next 5 years. The planning processes of BRAC Bank include the four major ones – strategic. tactical. Going Global: BRAC Bank sees itself to be one of the leading banks in at first the SAARC countries. Planning Types of Planning Strategic Planning: 1. They also have plans to expand their service to the Middle East. BRAC is going to engage a certain number of interns in customer relationship training programs. 2. 3. Provide Best Customer Care: BRAC Bank is a very customer orientated Bank and it believes that customer contentment is the key to success so it always tries to deliver the uppermost quality customer care and new types of services. etc. Hathajari in Chittagong. 6. Tactical Planning: 1. 3. Customer Acquisition: BRAC bank plans to reach the maximum number of customer by 2012 and set this milestone in Bangladesh. operational and contingency planning. 5. ©Page 12 .Management BRAC Bank‟s management system is very plain and not complicated. BRAC bank is considering necessary research to find the most efficient and customer attractive loan interest rates.

Similarly other interest rates of other loans are being reviewed but BRAC bank Management to make the adjustment. Contingency Planning: BRAC Bank has very effective contingency planning for emergency situation. Sending account statement to the account holder. BRAC Bank is expected to open a branch in the capital of Nepal because of the number of Bangladeshi workers working there.4. advertisement for expanding their market is also included in the programmed decision of BRAC Bank. sharing profit bonus with the employee and to deal with customer complaints. Introducing new services. fire extinguisher for security from fire. Using CCTV videos it identified the looters. Operational Planning: Operational planning of BRAC Bank is prepared by researching customers‟ needs. on any given if there are a great number of customers to serve they believe that they have enough manpower to serve them. quality of product and satisfying customers‟ demands. thereby assisting BRAC and stakeholders build a "just. BRAC Bank has always been able to provide them the best services. BRAC Bank never faced any fire incidents but it faced loot once. 5. sending catalog to customers in different occasions is incorporated in BRAC‟s non-programmed decision. Organizing Programmed Decision: BRAC Bank undertakes programmed decision for increasing salary of the employee. Besides BRAC Bank has set a benchmark for its employees to enable them perform the best. This sector is created solely to give the customers a joyous experience in banking as BRAC Bank believes that banking is like shopping. Branch managers of every branch undertake planning for their day to day activities. democratic and poverty free Bangladesh". To attract new customer BRAC Bank is launching a new banking service named “Joy of Banking” which is due this upcoming October ‟10. ©Page 13 . To protect Bank plunder they use CCTV and they have enough lighting facility so that the surrounding of the bank can be seen at night and thus they ensured security for emergency situation. BRAC Banks is now conducting a survey and research for opening branches in Nepal and other SAARC countries. Furthermore. enlightened. On different occasions such as Eid and Pujas there is a huge rush of customers. This will also help the mass number Bangladeshi tourist visiting Nepal. This year. Corporate Vision & Mission Statement: "Building a profitable and socially responsible financial institution focused on Markets and Business with growth potential. It provides superior customer services and always tries to develop existing services and to create new services to please the customer. Non Programmed Decision: BRAC Bank sometimes has to make non-programmed decision. In every branch of BRAC Bank there is fire exit. BRAC Bank will increase the interest rate on salary loan to 18% to ensure that the most deserving applicant get the scheme and reduce risk of bad debt. healthy. 6. BRAC never compromise with the quality of their services at any cost.

3. ©Page 14 . 4. 1. 4. Khulna. Delegating work assignment: BRAC Bank is centrally decision making company. 5. In short employees have no autonomy to choose the working method. 2. Rajshahi. 2. Barisal. Here the staffs are not only given target but also shown way how to achieve it. Accounting and Finance. 2. Geographic Departmentalization: The organization structure of BRAC Bank has reflected its operation in two geographic areas –The Bangladeshi sector and the International sector. 6. Chittagong. International sectors are divided in two sectors: 1. Middle Eastern countries. Functional Departmentalization: BRAC Bank organized work units according business functions. SAARC countries. Famina Banking (specially designed for women) Student Banking. Service Departmentalization: Service departments of BRAC Bank are: SME Banking. Every decision is made by the board of directors. Dhaka. The divisions are:1. 2. Management Information System. 3. There are divisional or regional departments for branches inside Bangladesh. Human Resource Department.Departmentalization 1. 3. 4. Here no employee can make decision to perform his work. 1. Sylhet. Functional departments of BRAC Bank are:Marketing. Retail Banking. Bangladeshi sectors include six divisions of Bangladesh. 3.

CEO makes decisions. Interest Rates: BRAC Bank always tries to balance between interest rate on FDR and Loan. On any given day. New feature is being added to their existing service so they have to increase their service charge. Employees have no freedom to give their own opinion regarding the work method. It gives 9% interest on FDR and charges almost 17% on loan account. ©Page 15 . BRAC Bank controls the company by the following aspects- Customer Satisfaction: “We are not satisfied until our customer is satisfied” -this is BRAC‟s view regarding customer satisfaction. he takes fast action & makes decisions which sometime displease the employees. This balanced rate enables BRAC Bank to earn handsome profit. Whenever Managing Director needs to resolve a conflict. CEO‟s surprise visit to different branches is a very unique feature of BRAC Banks customer service. Their service is being modified constantly. communicate them to subordinates and expect prompt implementation of instructions. They use the best technology and skilled human resource to provide customer quality services. It can be said BRAC being a very new Bank has achieved today‟s position for being able to satisfy the customers Quality of Service: BRAC Bank never compromise with the quality of service. Furthermore they are constantly trying to develop their services. Controlling To BRAC Bank controlling means setting up a standard to manage the business and evaluate the employees‟ performances. the customer might meet the CEO asking what they like and don‟t about BRAC. They always provide quick response to solve the problems of customer.Directing „BRAC Bank‟ basically runs on autocratic leadership style. Service Charge: BRAC Bank provides very excellent service to customers at a very minimum price.

Providing superior customer service and investing in the most profitable project they believe they will be the best brand in Bangladesh.It is a very growth oriented and customer driven bank.BRAC Bank is striving to the best bank (in terms of profit and fund management) of Bangladesh within 2012. BRAC Bank Limited • Leadership ©Page 16 .

“Leadership is the process of inspiring.providing Bangladesh with a degree of service and professionalism that the traditionally underserved class could ever dream of. and guiding others to participate in a common effort. Leader in the BRAC Bank delegates a great deal of authority while retaining ultimate responsibility.” ©Page 17 . Chairman’s Speech: “…. Management in BRAC Bank divided the work and assigned on the basis of participatory decision making.way flow of upward and downward communication.” BRAC Bank follows Democratic style. Although one problem with democratic process is that it is time consuming. BRAC Bank enhances their personal commitment through participation. influencing. Active two..the bank has seen that a goal a long way through.

• Human Resource BRAC Bank Limited Management ©Page 18 .

success is recognized in ways which are relevant to the individual. Recruitment and Selection Process In recruiting and selecting employees in BRAC Bank. Performance management.Human Resource Management Planning for Staffing Needs BRAC‟s human resource division works to enforce procedural justice. Progress and Communication. 5. 7. Recruitment and Placement. human resource managers strive to match the needs of the organization and individual aspirations and encourage personal fulfillment. Policy. Sexual Harassment Elimination (Share) and staff Relation. BRAC ensures a working environment where their staff are nurtured and treated with dignity and respect. intensify transparency and equity and promote innovation and quality. 3. Human Resource Information System. 2. Therefore. The Human Resource Development is composed of sections:1. 4. Under the Human resource field operations. Human resource field operation. Staff separation and Compensation management. 8. Steps in recruitment and selection process are following- ©Page 19 . the division processed 9356 applications and recruited 889 staff. 6. HR officers working at the head office co-ordinate and provide to 15 decentralized HR field officers to accelerate HR services to BRAC field staff. In 2007.

Choose sources of candidate: BRAC Bank prefers both internal sources and external to find the best candidates for specific jobs in the process of recruitment based on situation. Review applications and resume: From the received applications they scrutinize. The paramount consideration in the appointment of a Staff Member shall be efficiency. Applicants must have to pass through a personal interview. identify and select the final ones that fulfill their requirements. case study followed by a practical task. competence and integrity. and training. So far as applicable. caste and creeds on the basis of demonstrated ability. Sometimes BRAC bank publishes advertisements on news papers of job vacancies stating special requirements as well. bank representatives go to the best universities of Bangladesh and pick out the most qualified students to offer them a chance to apply for the job. age and experience in not mandatory.Identify Job Requirement Choose Source of Candidates Review Application Resumes Interview Candidates Conduct Employment Test and Check Reference Follow Up Interview Select a Candidate and Negotiate Offer Identify Job Requirement: In BRAC Bank. Unlike most organizations. BRAC Bank provides equal employment opportunity to all applicants irrespective of gender. experience. Along with internal search for the best candidate. selection shall be made on a competitive basis. recruitment can be done in any division. ©Page 20 .

If the candidates written exam is successful then BRAC bank will invite him/her to an interview or viva exam to test out his/her skills from his/her chosen function and a member of the Human resource team. the recruitment is given special attention. they invite him/her to BRAC Bank assessment centre. Assessment centre: Depending on the outcome of the interview. Periodic Training: It is done periodically in every 6 months or 1 year to see how its employees are carrying out their jobs. If one joins BRAC BANK. In BRAC bank. The selection process of these posts is a very closely examined written test followed by a viva exam.Interview candidates: The selection process is a very closely examined written test followed by a viva exam. Recruitment Training: Recruitment training is mandatory and is given to each employee every month. Recruitment training. but fun participatory and individual exercises. They are:1. Periodic training. Select a candidate and negotiate an offer: After the assessment they call in the final chosen applicants to negotiate an offer for salary and compensation benefits. competency and integrity. for special posts of Management Training Officer (MTO) and Corporate Relationship Officer (CRO). Employee Training BRAC BANK invests heavily in training and development programs that provide a real opportunity to learn the best organizational skill. BRAC BANK support employees in continuously improving and do all they can to build on his/her functional and leadership capabilities throughout his/her career with BRAC BANK. Here one will demonstrate his/her skills and suitability through his/her performance in a number of stretching. ©Page 21 . 2. they are committed to working in partnership with his/her to help him/her develop the skills one need to succeed as a business manager anywhere in the country BRAC bank has been designed to look for fresh recruitment and carries out training in two ways. The consideration in the appointment should be of efficiency.

Pahela Baishakh and on other different occasions. 2. Festival Bonus: BRAC bank offers festival bonus during EID. Flexible Benefit Plan: BRAC bank offers its employees a range of options form which they can choose the type of benefits they want to receive. Gain Sharing: BRAC Bank awards bonus to the employees for surpassing predetermined performance goals. The options for this benefit plans are:1. BRAC will bear their expenses. Paid Vacations:. But it has certain criteria. Life Insurance. Housing loan and also other certain allowances such as car allowance. Employee Benefits Provident Fund: BRAC Bank provides provident funds to the employees. In this benefit scheme the branch managers can travel to neighboring countries with their family members. Loan Facilities: BRAC bank also proves Car loan. Medical Insurance. But to get profit from the fund the employee has to work for certain period of time in BRAC bank. Lump-Sum Bonus: BRAC Bank pays onetime bonus or sometimes gives opportunity to buy shares of the bank based on the competitive performance of the employee. ©Page 22 . If they resign earlier they will not get the profit from the bank fund but they will get the money that was cut from their salary. BRAC will cut an amount of money from the monthly salary of the employee and add the same amount from the bank fund.Employee Compensations Profit Sharing: BRAC Bank awards bonus with its employees from the profit it earns every financial year. mobile and free transport service. Cost of Living Adjustments: They also have a service plan for the employees called “COLA” (Cost of Living Adjustments) in which the employees get cost of living adjustments if inflations occur.

Comparing actual with the benchmark: BRAC bank‟s manager of an employee‟s respective functional area will play a key role in this and it depends on the employee developing their careers. 4. They evaluate performance of their employees by appraising performance which is comparing actually result with one desired outcome and also 360 degree performance review.3. Disability Insurance. and positive team relationships. ©Page 23 . Proficient. they regularly compare themselves to a select group of other businesses and reward higher performance by individuals and teams. Superior. Pay for knowledge: BRAC Banks reward and benefits practices aim to support in attracting and retaining the best people for the organization. Non-performance. They want their employees to feel rewarded by the challenge of their roles. 4. Outstanding. 5. Performance Evaluations BRAC bank helps its employees better themselves by providing feedback about the particular employees past performance. Paid Time Off (PTO). To maintain an attractive salary and benefit package. BRAC bank evaluates on the basis of performance appraisal every six months or annually in one year and the performance is judged by 5 main words of expressions: 1. 2. 6. learning new job tasks. 1. career opportunities. 3. Marginal. Excellent.

Downsizing: BRAC bank is a very new bank its number employee is only 9000 therefore there isn‟t any extensive downsizing. Using contingent workers: They use contingent worker to decorate the office while opening new branches. The only indirect outsourcing of BRAC bank is through the HR contract of in the bank maintenance and cleanliness which is outsourced to a company called “CLEANCO”. IT support and HR is also outsourced in case of technical problems. 2. ©Page 24 . This motivates the employees and makes them satisfied. Outsourcing: Outsourcing is not directly practiced by BRAC bank.Employee Opinions BRAC BANK is committed in creating an environment where employees at all levels feel that they can speak honestly about the company and issues important to them. 3. BRAC BANK carry out employee opinion surveys every year and the results are very positive. Employee Separations 1. IT support is managed by the famous Telecommunication Company City cell.

• Corporate BRAC Bank Limited Social Responsibility ©Page 25 .

Over 1. 3. Public health Issue: The Annual Eye Expedition: BRAC Bank‟s/Eye Foundation Hospital‟s Free Eye Expedition Program is flagship project in the new policy thrust. The services BRAC bank offers also present an opportunity for them to make a real contribution – opening up new markets for example in renewable energy and clean technologies. integrating environment and sustainable development considerations into our lending decision making process. In this respect. the Bank does not act through third party charity organizations and care givers.To The General Public 1. That way. BRAC bank recognizes that to deliver meaningful progress in these areas.500 people were screened for various eye ailments. the resultant impact is maximized for society‟s most needy. The first expedition under the program kicked off in 1999. Corporate Philanthropy: In 1999 the Bank had a major policy rethink in the area of corporate social responsibility to strengthen direct involvement in its primary operational environment in such a way that the resultant impact is maximized for society‟s‟ most needy. 500 received free eyeglasses and 22 cataract surgery operations were performed free. with special emphasis on the indigent section of the society. The policy on Corporate Social Responsibility is essentially driven by the imperative to directly and positively touch the lives of its stakeholders. workforce customer BRAC bank‟s quality of workforce is suitable for the consumer as their behavior is good and there ©Page 26 . they also engage people and wider stakeholders in the value of taking an environmentally responsible path. Protecting the environment: Through BRAC Bank lending practice has a real opportunity to be a force for good. Of this number. Instead Developing working experience the the is bank gets quality enough for involved of the directly. 2.

BRAC takes this very sincerely and takes in all the legitimate complains and direct to the respective parties. Along with that. In this program the youth of the under developed areas are given training in various technical sectors. Consumers choose a specific offer or particular type based on their own interest or needs. 3) Right to choose: They never go for push selling customers. BRAC Bank offers and regulates proper safety measures for all the employees employed in their workplace. 4) Right to be heard: Like other responsibilities. operating garment factory machines. They have their own variety of service. 2) Right to be informed: The customers are kept informed about the banks activities through the publication of annual reports. 1) Right to be safe: BRAC bank ensures their customer that their money is in safe hands and this is done by the public investment in safe sectors.Developing Workforce In 2004 BRAC bank has sufficiently funded and launched Youth Development Program (YDP) across Bangladesh. men and women are venerated and treated respectfully and equally in all terms. This has greatly aided in the country development. There has been no record of sexual harassment in BRAC Bank. there is no discrimination in the case of salaries and wages. To the Employees BRAC Bank has a moderate amount of responsibilities to their employees. ©Page 27 . Women are given sewing lessons and men given training on mechanical skills including fixing electronics. etc. BRAC Bank provides equal for all employees and workers regardless of age. proper amounts are given to employees according to their designated positions. There are well placed fire extinguishers in every branch and fire alarms and smoke detectors are linked with fire stations for quick and effective service in case of any accidents. operating and fixing automobiles. Every organization should have occupational safety precautions for the employees and workers. gender or racial status.

BRAC Bank authorities are trying to solve the problem by installing more and better technology ATM across the country. 2) Non sufficient liquidity in ATM Booth: Another major problem is that they do not have enough liquidity in their ATM booths across the country that‟s why their customer many of times have to return from the Booth without withdrawing money. ©Page 28 . BRAC Bank has almost 200 ATM across the country but mainly in Dhaka City but their ATM cannot hold enough money. 1) Not enough ATM Booth: One of the major problems is that they do not have enough ATM booths across the country that‟s why their customer cannot withdraw cash through the ATM Booth from wherever they want. But there are future plans from the managing committee to expand their ATM Booth Numbers across the Country. corporate diaries. BRAC Bank has almost 200 ATM across the country but mainly in Dhaka City but their competitor Like Dutch Bangla Bank Ltd. change and ambition. Helping bringing these stories alive is what we believe is our mission. sales. have more than 500 ATM booths across the country. growth. people walk through those doors with personal stories of hope. corporate calendars (displaying the brands) and the New Year cards are sent to some of the important stakeholders. etc. These items carry an important part in showing the „honesty‟ and „responsibility‟ attribute of the company. the BRAC Bank annual report containing all the necessary information (profits.” – BRAC Bank Some Problems and Solutions. revenues. The stakeholders receiving these items remain thankful to the company and will have a positive image of it..). at every BRAC bank branch doors open and close a million times or more. “Every day..To the Share Holders During the end of the year.. BRAC Bank Limited has been awarded ICAB National Award from Institute of Chartered Accountants of Bangladesh (ICAB) for one of the Best Published Accounts & Reports 2007 recently.. every day.

5. BRAC Bank authority is concern about this matter and trying their best to solve this problem. Bibliography: Book. BRAC Bank managing committee are arranging training program for their employee so that they learn how to improve their relationship with customers and provide better customer services. Visit to the bank’s personnel. Class Notes. 7. 6.bracbank. THE END ©Page 29 . July 18 July 27 August 04 August 06 4.com). 3. 2. It has been seen that they need time to execute a client request.3) Limit on withdrawal: BRAC Bank have created limit on withdraw if any big amount need to be withdrawn by a customer they need to inform it to the Bank previously unless they cannot withdraw any big amount. GANTT CHART July 14 Planning Data collection Scrap Final Review Submission 1. They also charge extra amount if any amount of money is withdrawal from their shared network ATM Booth. 4) Excessive Bank Charge on ATM Withdrawal: BRAC Bank charge relatively higher amount of card yearly fees compare to other banks. BRAC Bank authority is concern about this matter and trying their best to solve this problem. 5) They do not have good customer services: Customer services are not up to the mark in BRAC Bank their 24hrs bank services do not work most of the time. Internet Website (www.

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