Structure Of National Bank Of Abu Dhabi Business Essay

National Bank of Abu Dhabi is a commercial bank of the UAE, established in 1968 in Abu Dhabi. With 58 subdivisions in the UAE and 120 ATMs, it has the largest subdivision web. NBAD is the largest bank in the UAE with respect to assets, sedimentations and net incomes. It has decided to spread out its services into retail banking in 1999. It offers 24-hour cyberspace banking installations, and can be accessed through NBAD online. There is besides a 24-hour client support to react to the questions and ailments of the clients.

Abu Dhabi International Bank, a subordinate of NBAD, has twelve subdivisions in Egypt ; apart from the subdivisions in Oman, Bahrain, Sudan, France, UK and the US.

An of import section of NBAD is the HR section. This section has manifold activities with respect to employee compensation and benefits. The section is responsible for acknowledging, development and executing of the employee ‘s compensation policies. ( National Bank of Abu Dhabi, ameinfo, 1996 – 2010 AME Info FZ LLC )

NBAD: Vision, Mission & A ; Valuess

Vision: To go the figure one bank in the UAE

Mission: Supply the best client service experience

Valuess: To value stakeholders

To be accessible to the clients 24-hours

Having a planetary mentality

Understanding client demands and demands

To endeavor for uninterrupted organisational excellence

Corporate Social Duty: The bank pledges for societal and environmental development of the UAE. ( National Bank of Abu Dhabi, NBAD, 2010 )

The Pay-Structure Issue: The current issue with NBAD is its wage construction. The present wage procedure requires re-structuring as it is outdated. It has excessively many allowances that make it instead complex and confounding for the HR in analysing the compensation constituents. The assorted allowances, fillips and hard currency inducements are non decently defined in the wage construction. A wage construction must be simple and consistent in for being good both to the employer and the employees. An out-of-date wage construction leads to confusion and unfairness in the system, with incompatibility in the wage of similar classs. If allowances are non defined, there shall be job in the measuring of public presentations of the employees. Excessively much of hard currency inducements can non hike employee motive to take extra duties. This is because hard currency inducements are little sums of money that is spent off excessively rapidly. Imprecise revenue enhancement constituents in the wage construction may take to confusion excessively. The employees may hold a feeling that they are overburdened with revenue enhancement. The HR section must explicate the revenue enhancement points and freedoms clearly to the employees.

Identifying the Problem: The feedback received from the line directors every bit good as the employees were similar every bit far as the wage construction issue is concerned. A complex and stiff wage construction has the undermentioned negative impacts:

Confusion at the work topographic point.

An endless & A ; boring procedure of adding new allowances to the wage construction.

Wastage of clip in tracking payments.

There is no consistence in the wage of same class.

Employees feel that there is unfairness in the system.

There is no lucidity in the wage as allowances are non decently defined.

Wastage of money.

Aims & A ; Aims: The aim of this undertaking is to re-structure the bing wage system and do it simple and consistent. The basic purposes and aims of a good wage construction are:

It shall assist in associating wage construction with public presentation.

Closing the salary spreads within the same class.

There are 4 stairss in associating competences with public presentation:

Rating the employee ‘s demonstrated capablenesss.

Rating the employee ‘s accomplishment of the ends.

Maping the evaluations on X and Y axis of grid.

Determining how the employees can be paid maintaining in the current market conditions. ( By Vogeley, Edward G. , HR magazine, Link employee wage to competences and aims, all concern, October1, 1995 )

Benefits to Employees:

A simple and good defined wage construction helps in better apprehension.

Employees get a feeling that there is equity in the wage system.

It reflects transparence.

Performance degree of the employees can be examined among employees of the same class.

Benefits to Bank:

A well planned wage system is cost effectual for the bank.

Wages can be paid within the bank ‘s budget.

Easier to compare or vie with the wage construction of other Bankss.

Easier to track payments.

Benefits to the HR

Saves HR ‘s clip in the elaborate account of the wage system.

Time to concentrate on strategic HR issues.

A modern and up-date wage system helps being aligned with planetary HR patterns.

Better enlisting and keeping of employees.

Giving the company an effectual wage system.

Methodology: Developing an Ideal Salary Structure

The current rewards and salary constituents of an organisation ( Abu Dhabi National Bank ) must be based on good defined group of occupations. The monetary values and costs that are associated with these groups of occupations affect an organisation ‘s competitory place every bit good as find the competitory salary degree of the bank.

Factors for Developing a Cost Effective Salary Structure

There are two factors:

A peculiar occupation ‘s current salary rate,

The informations collected from salary studies.

Organization ‘s Methodology

It is upon the organisation to make up one’s mind whether it shall pay the wages:

Above market rate.

Below market rate.

At par with market rate.

Three attack for an Organization ‘s Salary System

These three methods are discussed as follows:

Lag The Market: The salary study informations is updated to the beginning of the following fiscal twelvemonth. After this is done, a new salary construction is incorporated in the company. For illustration, a alteration in the labour market of 10 per centum is assumed for the following twelvemonth. In such a instance, the lone clip the bank shall be competitory with the market is the beginning of the twelvemonth. Hence, by the twelvemonth terminal, the salary construction shall dawdle the market by 10 per centum.

Lead the Market: The organisation pays above the bing market rate. This is done by get downing the twelvemonth at 10 per centum above the salary study informations. Consequently, by the year-end the bank will be merely paying the market rate.

Lead Slowdown: The bank considers 10 per centum estimated alterations in the market and wants to run into the market rate at the center of the twelvemonth. ( Making a competitory wage construction, scribd.com, N.D. , Anon )

The interview of the HR director, employee study and CIPD study sing payment methodological analysis may be tabled as follows:

Table 1 ( HR Manager )

HR Manager

Interview

Answers

Consecutive No.

1.

What are the chief constituents of an ideal wage construction?

They are basic wage, committees, overtime, fillips, hard currency inducements, non-cash inducements, public presentation wage, HRA, conveyance, meal allowance, medical insurance, and revenue enhancements.

2.

What is most of import while make up one’s minding on wages?

The most important portion is to make up one’s mind whether the company shall put wages above, below or at par with market conditions.

3.

What is the benefit of puting wages at par with present market rates?

The benefit lies in the fact that adhering to market rates makes the salary competitory. It is good for both the employer every bit good as the employee.

4.

How of import it is to find classs and class wages?

It is perfectly necessary to set up senior, junior, intermediate and novice ‘s degree. Then delegating a class to each degree.

Following measure is to find class wages or the pecuniary scope of a place at a peculiar degree.

5.

What are the benefits of such grade wage?

It brings equity in the wage construction and reduces spreads in wages of the same class. Consequences in employee satisfaction.

Table 2 ( Employee Survey )

Employee

Survey

Feedback/Individual Opinion & A ; Findingss

Consecutive No.

1.

What is the entire figure of old ages you have been working at your current organisation?

In Bahrain and Oman employee keeping and trueness is higher than other states.

2.

How many occupations have you changed in the last five old ages?

In UAE, employees seem to alter occupations more often.

3.

Which of the undermentioned do you believe is a better wage construction?

Fixed Pay Structure

Partially Fixed Pay Structure ( with variables like committees & A ; inducements ) OR

Full Variable Pay

Respondents from UAE, Bahrain, Qatar and Lebanon prefer a fixed income construction.

While Tunisia, Algeria and Saudi Arabia prefer a variable wage construction.

4.

Which of the followers should be included as attractive inducements in your compensation bundle?

Stock options, Commission, Professional preparation OR Performance wage

Respondents in Qatar, Oman and UAE like to hold public presentation based wage. On the other manus, Syria prefers professional preparation and development.

5.

Which income degrees does your personal monthly income autumn into?

UAE and Qatar have higher income degrees. Algeria, Morocco and Egypt have lower personal income degrees.

6.

Which are the most good paid and lower paid industries harmonizing to you?

Respondents said that Banking, Construction, Oil and gas are good paid than other industries. While Education, Electronics and Tourism are lower paid.

7.

Do you experience the wage in your company is competitory?

Employees in UAE, Bahrain and Qatar feel that their wages are non that competitory to others.

( The Middle East Salary Survey, bayt.com, Feb 2010 )

Table 3 ( Website )

Website

CIPD

Best Practice

Consecutive No.

It was found that newer companies, particularly those in the high-tech sectors are honoring employees with exciting benefits i.e. fine-looking fiscal wagess.

Pensions, Stock Options, Company Cars and medical insurance.

( Steve Palme, Pay degrees market pricing, CIPD, February 2010 )

Findingss:

After holding a glimpse through the studies, some findings and consequences have been obtained. These findings are the constituents of the wage construction like hard currency and non-cash inducements, fillip and overtime wage. There are besides certain other facets such as fixed wage construction, partly fixed wage constructions and a entire variable wage construction. We besides get an thought of higher and lower income degree groups, and attractive inducements in the wage bundle. We get a glance of the higher and lower paid industries in UAE excessively. The fight of the wage bundle is another important facet of a bank ‘s wage construction. The best patterns adopted by companies in honoring their employees may be implemented in the wage construction of ailing paid orgnizations. In the following subdivision of this undertaking, the treatment shall chiefly concentrate on the analysis of the above findings.

Analysis

Cash Incentives

There are incentive plans in every company ‘s salary construction. In this respect, it must be noted that the inducement programs may change from company to company. There is no 1 peculiar inducement scheme that may work universally in every corporate organisation. The pros and cons of hard currency inducements are discussed as follows:

Professionals:

It is really easy to give out hard currency inducements as every employee is familiar with it.

Since the wages is in the signifier of hard currency, it allows the employees to pass the sum for their personal demands.

It is frequently the most popular pick among employees since it is a pick based on the employee ‘s impulse.

Cons:

It is non actuating since hard currency inducements come in little sums.

It has no value in footings of award or award.

It is frequently confused with wages and fillips.

It is largely spent on little necessities of the employees. The sum is so little that it is frequently forgotten.

It has no enduring value. The little sum is received, spent and gone without much satisfaction. ( Cash incentives- Pros & A ; Cons, incentives market place, Anon, 2010 )

Non-Cash Incentives

Professionals:

For employers it is low-cost. More low-cost than hard currency fillips.

It has more simpleness than fillips or hard currency inducements. Cash inducements may affect hard expressions and include multiple marks.

It has brag value as non-cash inducements are by and large in the signifier of gifts.

Cons:

It is non taken that earnestly by others as it does non hold any hard currency value.

Employees may non be cognizant of the value of non-cash inducements over difficult hard currency. This may ensue in employee dissatisfaction. ( Janet Egan, non-cash inducements, CIPD, April 2009 )

Variable Wage

Advantages:

Motivate employees and aid in squad edifice.

Encourages employees to take extra duties for fiscal benefits.

It enhances profitableness since it encourages job work outing accomplishments.

Variable wage implies, better the performance- the more the hiking in the wage. In this manner, it encourages an environment of uninterrupted acquisition, betterment and invention.

It creates a competitory ambiance and comes utile in advancing the best performing artists in the company.

Disadvantages:

If the bank does non hold lucidity in its ends and aims, so variable wage is a complete waste of money.

Slow workers may be forced to work extra without any payment to diminish paysheet disbursals. This may ensue in employee dissatisfaction and enhance abrasion rates in the company. ( Kelly Swaggerty, The pros & A ; cons of variable wage, resources hrbrainbank, 6 March 2009 )

Overtime

Advantages:

Adaptable employees.

An effectual method of covering with absenteeism, deficit of staff without any new enlisting.

Enhanced net incomes for employees.

Drawbacks:

Consequence in inefficiency if the employees slower their rate of work in order to be eligible for overtime.

Excess disbursals for the company.

Long working hours may ensue in wellness issues with employees and no societal or household life.

If employee outlook degrees do non tally with overtime wages, it may ensue in employee bitternesss. ( Manage overtime, Department for concern, invention & A ; accomplishments, .businesslink.gov.uk, 2010 )

Decision

It can be inferred from the above analysis that a sound wage construction is really important in finding employee satisfaction every bit good as for the benefit and profitableness of the bank or any organisation. It is frequently wrongly said that an apt and nice wage bundle is merely good for the employees. But in world, the public assistance of the company is every bit dependent on its wage constituents. As we have seen in the studies that an organisation that does non hold a competitory wage construction consequences in employee dissatisfaction. This consequences in the inclination to travel to other companies offering a competitory wage. Small or undistinguished hard currency inducements do function the coveted intent. Hence, it is extremely indispensable to implement a simple, competitory and sound wage construction in NBAD. Assorted factors and restraints must be looked into by the HR section before be aftering a perfect wage construction of the bank.

Recommendations: Best Wage Practice

Here are some recommendations for execution of best wage constructions:

Execution of wage for public presentation.

Shape the wage for public presentation harmonizing to the nature of the occupation.

Associating 20 per centum to 100 per centum of an employee ‘s compensation to his public presentation.

Outstanding performing artists must be given moneymaking wages.

Best performing artists with greater duties must be given stock options and auto allowances.

Introducing pensions and medical insurance in the wage construction.

Making the wage construction more competitory.

Greater inducements for employees who exceed outlooks sing production and quality marks.

Investing chances to cut down revenue enhancement loads.

( George CloutierHYPERLINK “ hypertext transfer protocol: //www.businessweek.com/bios/George_Cloutier.html ” , To better public presentation, revise your wage construction, businessweek.com, Oct2, 2009 )