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Study of Promotion & Reward

Policy of Organisation

Presented by:
Abhijit Sarwade
Aniket Mohite
Ashutosh Salve
Vrushabh Thorat
Rohit Joshi
COMPANY PROFILE
STATE BANK OF INDIA
• The State Bank of India, the country‘s oldest Bank and a premier in
terms of balance sheet size, number of branches, market
capitalization and profits is today going through a momentous phase
of Change and Transformation – the two hundred year old Public
sector behemoth is today stirring out of its Public Sector legacy and
moving with an agility to give the Private and Foreign Banks a run
for their money.

• The bank is entering into many new businesses with strategic tie ups
– Pension Funds, General Insurance, Custodial Services, Private
Equity, Mobile Banking, Point of Sale Merchant Acquisition,
Advisory Services, structured products etc – each one of these
initiatives having a huge potential for growth.
• The Bank is forging ahead with cutting edge technology and
innovative new banking models, to expand its Rural Banking base,
looking at the vast untapped potential in the hinterland and proposes
to cover 100,000 villages in the next two years.

• It is also focusing at the top end of the market, on whole sale


banking capabilities to provide India‘s growing mid / large
Corporate with a complete array of products and services. It is
consolidating its global treasury operations and entering into
structured products and derivative instruments. Today, the Bank is
the largest provider of infrastructure debt and the largest 26 arranger
of external commercial borrowings in the country. It is the only
Indian bank to feature in the Fortune 500 list.
Background
• State Bank of India is the largest and one of the oldest commercial
bank in India, in existence for more than 200 years.

• The bank provides a full range of corporate, commercial and retail


banking services in India.

• Indian central bank namely Reserve Bank of India (RBI) is the


major share holder of the bank with 59.7% stake. The bank is
capitalized to the extent of Rs.646bn with the public holding (other
than promoters) at 40.3%.

• SBI has the largest branch and ATM network spread across every
corner of India. The bank has a branch network of over 17000
branches (including subsidiaries).
• Apart from Indian network it also has a network of 73 overseas
offices in 30 countries in all time zones, correspondent relationship
with 520 International banks in 123 countries.

• In recent past, SBI has acquired banks in Mauritius, Kenya and


Indonesia. The bank had total staff strength of 198,774 as on 31st
March, 2008. Of this, 29.51% are officers, 45.19% clerical staff and
the remaining 25.30% were sub-staff.

• The bank is listed on the Bombay Stock Exchange, National Stock


Exchange, Kolkata Stock Exchange, Chennai Stock Exchange and
Ahmedabad Stock Exchange while its GDRs are listed on the
London Stock Exchange.
Difference Between Public Sector and
Private Sector Banks
• Public sector banks are those where majority of the stake in the
bank is held by government. Where as in private sector bank,
majority is held by share holders of the bank.

• Individuals get a fair idea, if we say SBI is a public sector bank and
ICICI is a private sector bank.

• Both type of bank offer same services, however charges differ and
so as the quality and time duration for the services provided.

• One can also see the difference between interest rates


Promotion
• Promotion is advancement of an employee to a better job-
better in terms of greater responsibility, more prestige or
status, greater skills and especially increased rate of pay or
salary.

The main conditions of promotion are:-


• Reassignment of higher level job to an employee than what
he is presently performing.
• The employee will naturally be delegated with greater
responsibility and authority than what he has had earlier.
• Promotion normally accompanies higher pay.
Purpose of Promotion
• To develop competent internal source of employees ready to
take up jobs at higher level in the changing environment.

• To promote a feeling of content with the existing conditions


of the company and a sense of belongingness.

• To build loyalty and to boost morale.

• To reward committed and loyal employees.


Basis to Promotion : Seniority
• Seniority refers to relative length of service in the same job and
in the same organization.

• The logic behind considering the seniority as a basis of promotion


is that there is a positive correlation between the length of service
in the same job and the amount of knowledge and the level of
skill acquired by an employee in an organization.

• Easy to measure and judge the seniority

• No scope for favouritism, discrimination thus reduces conflicts


Basis to Promotion: Merit
• Merit is taken to denote an individual employees skills,
knowledge, ability, efficiency and aptitude as measured
from educational, training and past employment record.

• Better utilization of resources.

• Motivation to competent employees.

• Encourages employees to acquire new skills/knowledge.


Types of Promotion
• Horizontal Promotion:-
-This type of promotion involves an increase in responsibilities, and
a change in designation .But the employee concerned does not
transgress the job classification.

• Vertical Promotion:-
-This type of promotion results in greater responsibility, prestige and
pay, together with a change in the nature of the job.

• Dry Promotions:-
-The person is promoted to just next level in heirarchy. Designations
are different but no change in responsibilities.
Benefit of Promotion
• Promotion places the employees in a position where an employees skills
and know ledge can be better utilized.

• It creates and increases the interest of the other employees in the company
as they believe that they will also get their turn.

• It creates among employees a feeling of content with the existing


conditions of work and employment.

• It increases interest in acquiring higher qualifications, in training and in self


development with a view to meet the requirement of promotion.

• Promotion improves employee morale and job satisfaction.

• Ultimately it improves organizational health.


Demotion
• Demotion is the reassignment of a lower level job
to an employee with delegation of responsibility
and authority required to perform that lower level
job and normally with lower level pay.
Organizations use demotion less frequently as it
affects employee career prospects and morale
Need for Demotions
• Unsuitability of the employee to higher level jobs.

• Adverse business conditions.

• New technology and new methods of operation demand


new and higher level skills.

• Employees are demoted on disciplinary grounds. This is one


of the extreme steps and as such organizations rarely use
this measure.
Reward Policy
• A reward policy is a carefully drafted document
by an organization which states procedures,
policies, rules and standards associated with
allocation of benefits and compensation to
employees.
Reason for Reward
• Employee motivation

• Better employee retention

• Better work performance

• Creates a zeal in employees for recognition


Types of Rewards.
1 Non-monetary Incentives

2 Monetary Incentives
i. Group Incentive plans
ii. Individual Incentive Plans
iii. Factory /Plant wide Incentive
iv. Plans
Non-monetary Incentives
• Necessary to satisfy the social and egoistic needs of
workers

• Each person has its individual psychological framework and


responds to different appeals indifferent manner.

• Some commonly used Non-monetary Incentives are:-


o Praise and credit
o Security of tenure
o Participation
o Important and interesting task.
Monetary Incentives
• Skill-based rewards.
-Incentives given to people for acquiring and developing
job-relevant skills.

• Profit-sharing rewards
-Reward employees based on entire organization
performance.
-Often fund employee retirement plans.
Rewards which are used in SBI
1. Best Agent/ consultant /employee / Star performer of the month / quarter.
2. Best Management - For heads who right hand for management too in all activities.
3. Best Technical Leadership - head of R & D, next level to management who do mostly
program & new projects.
4. Most Efficient Employee - middle level mgt, who does his work without any expectation
from mgt.
5. Best Loyalty - Who worked lot for co. benefit & growth as a friend.
6. Most Progressive Employee - Newly joined employee
7. Best New Comer - Newly joined employee
8. Best Employee of the department - best in embedded prg.
9. Extra miler of the team/ department - in respective field
10. High Value Sales - huge order in single (from one co.)
11. Best Contributor for the team / department
12. Perfect attendance award- who is not taken leave
13. Best Software Support
14. Best System Support
Organizational Chairman

Hierarchy of Managing Directors

SBI Deputy Managing Directors

Chief General Managers

General Managers

Deputy General Managers

Assistant General Managers

Chief Managers

Managers

Deputy Managers

Assistant Managers

Probationary Officers

Clerical Staff

Sub Staff
Thank You