Black Book Hr 2018.docx

“COMPARATIVE ANALYSIS OF COMPENSATION AND INCENTIVE PLAN BETWEEN PUBLIC AND PRIVATE BANK”

SUBMITTED TO UNIVERSITY OF MUMBAI FOR PARTIAL COMPLETION OF THE DEGREE OF MASTER IN COMMERCE UNDER THE FACULTY OF COMMERCE

SUBMITTED BY SIDDHI KADAM ROLL NO: 48 M.COM (SEMESTER III)

UNDER THE GUIDANCE OF: PROF. Dr KANCHAN FULMALI

M.L.DAHANUKAR COLLEGE OF COMMERCE ACADEMIC YEAR: 2018-2019

“COMPARATIVE ANALYSIS OF COMPENSATION AND INCENTIVE PLAN BETWEEN PUBLIC AND PRIVATE BANK”

SUBMITTED TO UNIVERSITY OF MUMBAI FOR PARTIAL COMPLETION OF THE DEGREE OF MASTER IN COMMERCE UNDER THE FACULTY OF COMMERCE

SUBMITTED BY SIDDHI KADAM ROLL NO: 48 M.COM (SEMESTER III)

UNDER THE GUIDANCE OF: PROF. Dr KANCHAN FULMALI

M.L.DAHANUKAR COLLEGE OF COMMERCE ACADEMIC YEAR: 2018-2019

DECLARATION I the undersigned Miss. SIDDHI SANJAY KADAM here by, declare that the work embodied in this project work titled “COMPARATIVE ANALYSIS OF COMPENSATION AND INCENTIVE PLAN BETWEEN PUBLIC AND PRIVATE BANK”, forms my own contribution to the research work carried out under the guidance of Dr. KANCHAN FULMALI is a result of my own research work and has not been previously submitted to any other University for any other Degree/ Diploma to this or any other University. Wherever reference has been made to previous works of others, it has been clearly indicated as such and included in the bibliography. I, here by further declare that all information of this document has been obtained and presented in accordance with academic rules and ethical conduct.

Name and Signature of the learner

Certified by Name and signature of the Guiding Teacher Dr. Kanchan Fulmali

ACKNOWLEDGEMENT To list who all have helped me is difficult because they are so numerous and the depth is so enormous. I would like to acknowledge the following as being idealistic channels and fresh dimensions in the completion of this project. I take this opportunity to thank the University of Mumbai for giving me chance to do this project.

I would like to thank my Principal, Dr.D.M. DOKE for providing the necessary facilities required for completion of this project.

I take this opportunity to thank our Coordinator Smt. Nita A. Nerurkar, for her moral support and guidance.

I would also like to express my sincere gratitude towards my project guide Dr Kanchan Fulmali whose guidance and care made the project successful.

I would like to thank my College Library, for having provided various reference books and magazines related to my project.

Lastly, I would like to thank each and every person who directly or indirectly helped me in the completion of the project especially my Parents and Peers who supported me throughout my project.

CERTIFICATE

This is to certify that Ms has worked and duly completed her/his Project Work for the degree of Master in Commerce under the Faculty of Commerce in the subject of MANAGEMENT her project is entitled, “COMPARATIVE ANALYSIS OF COMPENSATION AND INCENTIVE PLAN BETWEEN PUBLIC AND PRIVATE BANK” under my supervision. I further certify that the entire work has been done by the learner under my guidance and that no part of it has been submitted previously for any Degree or Diploma of any University. It is her/ his own work and facts reported by her/his personal findings and investigations.

Name and Signature of Guiding Teacher

Date of Submission:

INDEX Particulars

Pg No.

Sr No. 1.1 1.2 1.3 1.4 1.5 1.6 1.7 1.8 1.9 1.10 1.11 1.12 1.13 1.14 1.15 2.1 2.2 2.3 2.4 2.5 3.1 4.1 4.2

CHAPTER 1 Introduction to compensation management Objectives of compensation management Need of compensation Significance of compensation management Principles of compensation management Types of compensation Factors influencing compensation Incentive plans Introduction to banking system in India Early history Difference between private and public bank Compensation in banking system Private bank v/s public bank- salary & benefits Private bank v/s public bank- career pros & cons SBI benefits CHAPTER 2 Objectives Hypotheses Importance of Study Limitation Research Methodology CHAPTER 3 REVIEW OF LITERATURE CHAPTER 4 Data Interpretation and Analysis Conclusion CHAPTER 5 Suggestions and Recommendations Bibliography Annexure

2 4 5 5 7 8 12 15 18 19 19 21 25 27 33 35 35 36 36 37 38 40 55 57 60 61

LIST OF TABLES SR NO. 4.1 4.2 4.3 4.4 4.5 4.6 4.7 4.8 4.9 4.10 4.11 4.12 4.13

PARTICULARS Age distribution Gender distribution Job experience years Average working hours Response to whether shift system is convenient or not Response to type of compensation available Basis on which organization provides compensation Kind of compensation employees prefer Response to is compensation based more on group performance & less on individual contribution Response to procedure of receiving formal feedback by employees Response to employees whether receive effective performance appraisal in organization Response to do training is provided for improving the performance Response to do employees are free to give ideas to higher management

PG NO. 40 42 43 44 45 46 48 49 50 51 52 53 54

LIST OF CHARTS SR NO. 4.1 4.2 4.3 4.4 4.5 4.6 4.7 4.8 4.9 4.10 4.11 4.12

PARTICULARS Age distribution Gender distribution Average working hours Response to whether shift system is convenient or not Response to type of compensation available Basis on which organization provides compensation Kind of compensation employees prefer Response to is compensation based more on group performance & less on individual contribution Response to procedure of receiving formal feedback by employees Response to employees whether receive effective performance appraisal in organization Response to do training is provided for improving the performance Response to do employees are free to give ideas to higher management

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PG NO. 41 42 44 45 47 48 49 50 51 52 53 54

CHAPTER 1 SUMMARY In this changing scenario compensating the employees according to the performance and which motivates them is the priority and right of employees. There is a strong link between compensation and employee motivation. The objective of this research paper is to analyse compensation management practices in banking sector. The main aim of this Research paper is to comparatively study compensation management and related aspects between public and private bank and to know the impact of compensation management on employee motivation .The basic purpose of this project is to find out what are the various performance based incentive schemes and how are these being used by the bankers to improve their profitability. As we know that success of any service organization depends upon how strong that bank is managing its employees and retaining them over the period of time to have much better employee’s productivity. For my project I have studied the incentive schemes at Public bank and private bank. Public bank are following the performance based incentives schemes, which is based on basic pay + additional incentives. Private bank is more towards ESOP-Employee Stock Option Plans and Early Retirement benefits

The research paper makes use of structured questionnaire administered to the selected respondents for data collection has been done. The results revealed that there significant difference between compensation and incentive plan in public bank and private bank. It also revealed that private bank have good performance measures, performance related pay which is associated with improved employee productivity rather than public bank.

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1.1 Introduction Of Compensation Management Compensation Management is an integral part of the management of the organization. Compensation is a systematic approach of providing monetary value to employees in exchange for work performed. Compensation may achieve several purposes assisting in recruitment, job performance, and job satisfaction. To be effective, the managers must appreciate the value of competitive pay, their human resources, and have an investment view of payroll costs. It is of prime importance for an organization to maintain pay levels that attract and retain quality employees while recognizing the need to manage payroll costs. “Compensation refers to all forms of financial returns and tangible services and benefits employees receive as part of employment relationships. Compensation comprises of all the benefits provided to employees in return of the services given by employees. Compensation not only satisfies employees but also motivates employees. Compensation is all about the financial and non- financial benefits which are the rights of employees for their contribution to the organization. Compensation directly or indirectly affects the performance of the employees. The different components of compensation makes employees feel that they are secured and working under a better organization that is fulfilling their needs. When the employees feel secured and satisfied they perform better.”

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"Compensation includes direct cash payments, indirect payments in the form of employee benefits and incentives to motivate employees to strive for higher levels of productivity” Compensation is a tool used by management for a variety of purposes to further the existence and growth of the company. Generally, compensation payable to an employee includes the following three components:  Basic compensation for the job (wage/salary)  Incentive compensation for the employee on job  Supplementary compensation paid to employees (fringe benefit and employee services)

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1.2 OBJECTIVES OF COMPENSATION MANAGEMENT: 1. Attracting and Retaining Personnel: From organization’s point of view, the compensation management aims at attracting and retaining right personnel in the Organization. Not only they require persons who are well qualified but they are also retained in the organization. In the present day context, managerial turnover is a big problem particularly in high knowledge base Organizations.

2. Motivating Personnel: Compensation management aims at motivating personnel for higher productivity. Monetary compensation has its own limitations in motivating people for superior performance.

3. Optimizing Cost of Compensation: Compensation management aims at optimizing cost of compensation by establishing some kind of linkage with performance and compensation.

4. Consistency in Compensation: Compensation management tries to achieve consistency-both internal and external-in compensating employees. Internal consistency involves payment on the basis of criticality of jobs and employees' performance on jobs.

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1.3 NEED OF COMPENSATION:  Unless compensation is provided no one will come and work for the organization. Thus, compensation helps in running an organization effectively and accomplishing its goals.  Salary is just a part of the compensation system, the employees have other psychological and self-actualization needs to fulfil. Thus, compensation serves the purpose.  The most competitive compensation will help the organization to attract and sustain the best talent. The compensation package should be as per industry standards.

1.4 Significance of Compensation Management: Compensation and Reward system plays vital role in a business organization. The fair compensation system will help in the following:  An ideal compensation system will have positive impact on the efficiency and results produced by employees. It will encourage the employees to perform better and achieve the standards fixed.  Such a system should be well defined and uniform. It will be apply to all the levels of the organization as a general system.  The system should be simple and flexible so that every employee would be able to compute his own compensation receivable.  It should be easy to implement, should not result in exploitation of workers.  It will raise the morale, efficiency and cooperation among the workers. It, being just and fair would provide satisfaction to the workers.  Such system would help management in complying with the various labour acts.  It aims at creating a healthy competition among them and encourages employees to work hard and efficiently.  The system provides growth and advancement opportunities to the deserving employees

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 The organization is able to retain the best talent by providing them adequate compensation thereby stopping them from switching over to another job.  The sound compensation system is hallmark of organization’s success and prosperity. The success and stability of organization is measured with pay-package it provides to its employees.

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1.5 Principles Of Compensation Policy:  Compensation policy should be developed by taking into consideration of the views of employers and employees  The compensation policy or wage policy should be clearly defined to ensure uniform and consistent application.  The compensation plan should be matching with overall plans of the company.  Management should inform the wage/salary related policies to their employees. Workers should be associated in formulation and implementation of wage policy  All wage and salary related decisions should be checked against the standards set in advance in the wage/salary policy  To manage compensation related matters adequate information/data should be developed and stored for future planning and execution.  The compensation policy and programme should be reviewed and revised periodically in conformity with changing needs.

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1.6 Types of Compensation Management: There are two modes of providing compensation to any employee. A) Direct Compensation: All the monetary benefits provided by an organization are considered as direct compensation. B) Indirect Compensation: The non-monetary benefits such as perks, time off, medical benefits are considered as indirect compensation.

DIRECT COMPENSATION: Direct compensation refers to monetary benefits offered and provided to employees in return of the services they provide to the organization. Direct Compensation Includes:

Basic Salary Salary is the amount received by the employee in lieu of the work done by him/her for a certain period say a day, a week, a month, etc. It is the money an employee receives from his/her employer by rendering his/her services.

House Rent Allowance Organizations either provide accommodations to its employees who are from different state or country or they provide house rent allowances to its employees. This is done to provide them social security and motivate them to work.

Conveyance Organizations provide for cab facilities to their employees. Few organizations also provide vehicles and petrol allowances to their employees to motivate them.

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Leave Travel Allowance These allowances are provided to retain the best talent in the organization. The employees are given allowances to visit any place they wish with their families. The allowances are scaled as per the position of employee in the organization.

Medical Reimbursement Organizations also look after the health conditions of their employees. The employees are provided with medi-claim for them and their family members. These medi-claims include health-insurances and treatment bills reimbursements.

Bonus Bonus is paid to the employees during festive seasons to motivate them and provide them the social security. The bonus amount usually amounts to one month’s salary of the employee.

Special Allowance Special allowance such as overtime, mobile allowances, meals, commissions, travel expenses, reduced interest loans; insurance, club memberships, etc are provided to employees to provide them social security and motivate them which improve the organizational productivity.

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INDIRECT COMPENSATION: Indirect compensation refers to non-monetary benefits offered and provided to employees in lieu of the services provided by them to the organization. They include Leave Policy, Overtime Policy, Car policy, Hospitalization, Insurance, Leave travel Assistance Limits, Retirement Benefits, Holiday Homes.

Leave Policy It is the right of employee to get adequate number of leave while working with the organization. The organizations provide for paid leaves such as, casual leaves, medical leaves (sick leave), and maternity leaves, statutory pay, etc.

Overtime Policy Employees should be provided with the adequate allowances and facilities during their overtime, if they happened to do so, such as transport facilities, overtime pay, etc.

Hospitalization The employees should be provided allowances to get their regular check-ups, say at an interval of one year. Even their dependents should be eligible for the medi-claims that provide them emotional and social security.

Insurance Organizations also provide for accidental insurance and life insurance for employees. This gives them the emotional security and they feel themselves valued in the organization.

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Leave Travel The employees are provided with leaves and travel allowances to go for holiday with their families. Some organizations arrange for a tour for the employees of the organization. This is usually done to make the employees stress-free.

Holiday Homes Organizations provide for holiday homes and guest house for their employees at different locations. These holiday homes are usually located in hill station and other most wanted holiday spots. The organizations make sure that the employees do not face any kind of difficulties during their stay in the guest house.

Flexible Timings Organizations provide for flexible timings to the employees who cannot come to work during normal shifts due to their personal problems and valid reasons.

Retirement Benefits Organizations provide for pension plans and other benefits for their employees which benefits them after they retire from the organization at the prescribed age.

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1.7 Factors Influencing Compensation: There are several internal and external factors affecting employee compensation, which are discussed in detail below.

Internal factors: The internal factor exists within the organization and influences the pay structure of the company. These are as follows: 

Ability to Pay: The prosperous or big companies can pay higher compensation as compared to the competing firms whereas the smaller companies can afford to maintain their pay scale up to the level of competing firm or sometimes even below the industry standards.

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

Business Strategy: The organization’s strategy also influences the employee compensation. In case the company wants the skilled workers, so as to outshine the competitor, will offer more pay as compared to the others. Whereas, if the company wants to go smooth and is managing with the available workers, will give relatively less pay or equivalent to what others are paying.



Job Evaluation and Performance Appraisal: The job evaluation helps to have a satisfactory differential pays for the different jobs. The performance Appraisal helps an employee to earn extra on the basis of his performance.



Employee: The employee or a worker himself influences the compensation in one of the following ways. 

Performance: The better performance fetches more pay to the employee, and thus with the increased compensation, they get motivatedand perform their job more efficiently.



Experience: As the employee devotes his years in the organization, expects to get an increased pay for his experience.



Potential: The potential is worthless if it gets unnoticed. Therefore, companies do pay extra to the employees having better potential as compared to others.

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External Factors: The factors that exist out of the organization but do affect the employee compensation in one or the other way. These factors are as follows: 1. Labour Market: The demand for and supply of labor also influences the employee compensation. The low wage is given, in case; the demand is less than the supply of labor. On the other hand, high pay is fixed, in case; the demand is more than the supply of labor.

2. Going Rate: The compensation is decided on the basis of the rate that is prevailing in the industry, i.e. the amount the other firms are paying for the same kind of work.

3. Productivity: The compensation increases with the increase in the production. Thus, to earn more, the workers need to work on their efficiencies that can be improved by way of factors which are beyond their control. The introduction of new technology, new methods, better management techniques are some of the factors that may result in the better employee performance, thereby resulting in the enhanced productivity.

4. Cost of Living: The cost of living index also influences the employee compensation, in a way, that with the increase or fall in the general price level and the consumer price index, the wage or salary is to be varied accordingly.

5. Labor laws: There are several laws passed by the Government to Safeguard the workers from the exploitation of employers. The payment

of wages Act 1936, The Minimum wages act 1948,

The payment

of Bonus Act

1965, Equal Remuneration Act

1976, Payment of Gratuity Act 1972 are some of the acts passed in the welfare of the labor, and all the employers must abide by these.

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1.8 INCENTIVE PLANS Incentive is the process to motivate the employees to achieve the work goal with the financial rewards based on the evaluation of individual or group accomplishment According to Anthony, “an incentive is an important mechanism that encourages and motivates managers to achieve organizational objective” Incentive plans should include both individual and group incentive. In today’s competitive world the employees earns an extra income apart from their salary or wages in form of an incentive.

Types Of Incentive Plan: Organizations can opt for an effective incentive plans from the various alternatives available. The organizations usually opt for that incentive plans which suits its requirement the most. As incentives covers the financial matters, organizations need to be very focused in choosing the best alternative that is in alignment to the business goals and objectives.

The various incentives plans available are: Piece Rate Piece rate incentive is given to the employees based on the number of units produced. This plan is practiced in the sectors dealing with manufacturing of products such as engineering – automobile, telecommunication, FMCG, etc.

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Commissions Commission is a variable component of compensation package. It is given on the basis of business generated by the employee. Commission is a pre fixed component say 5% of the total sales done by the employee. It is practiced in the retail, FMCG and other sectors in the marketing and sales segment.

Bonuses Bonuses are given to employees on a pre established goal or criteria. The organizations set policies regarding the bonuses. Usually bonuses are provided during the festive season.

Merit Raises Merit raises are given on the basis of predetermined policies. The employees are given raise on the basis of their performance. The performance standards are set by the organizations much in advance.

Standard Hour Pay Standard hour plan provides incentives to employees based on the time saved by them during the job course. Employees’ productivity and quality is evaluated with respect to the set standards.

Maturity Curves Maturity curve incentive plan considers the experience and performance of an employee for giving out the incentives. It is practiced in all the industries. Experience is always given a weight-age as experienced people can produce better quality results.

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Gain Sharing Gain sharing incentive plans undertake those employees who give outstanding performances and provide for cost saving measures. Organizations believe in sharing the profits with the employees who are responsible for producing those results.

Profit Sharing Profit sharing incentive plans are practiced in retail and FMCG sectors. Other sectors too implement the plan based on organizational policies. It refers to giving out the share of profits the organization earned to all the employees. Indirectly all the organizations follow the plan by giving out the dividends.

ESOP It is called as Employee Stock Ownership Plan. In ESOPs the company contributes the share of its own stock or cash to be used to purchase such stock for employees. The trust holds the stock in individual employee’s account and distributes it to employees on retirement or any other separation from the service.

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1.9 INTRODUCTION TO BANKING SYSTEM IN INDIA

A bank is a financial institution that provides banking and other financial services to their customers. A bank is generally understood as an institution which provides fundamental banking services such as accepting deposits and providing loans. There are also nonbanking institutions that provide certain banking services without meeting the legal definition of a bank. Banks are a subset of the financial services industry. A banking system also referred as a system provided by the bank which offers cash management services for customers, reporting the transactions of their accounts and portfolios, throughout the day. The banking system in India should not only be hassle free but it should be able to meet the new challenges posed by the technology and another external and internal factors. For the past three decades, India’s banking system has several outstanding achievements to its credit. The Banks are the main participants of the financial system in India. The Banking sector offers several facilities and opportunities to their customers. All the banks safeguards the money and valuables and provide loans, credit, and payment services, such as checking accounts, money orders, and cashier’s cheques. The banks also offer investment and insurance products. As a variety of models for cooperation and integration among finance industries have emerged, some of the traditional distinctions between banks, insurance companies, and securities firms have diminished. In spite of these changes, banks continue to maintain and perform their primary role-accepting deposits and lending funds from these deposits.

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1.10 EARLY HISTORY: Banking in India originated in the last decades of the 18th century. The first banks were The General Bank of India which started in 1786, and the Bank of Hindustan, both of which are now defunct. The oldest bank in existence in India is the State Bank of India, which originated in the Bank of Calcutta in June 1806, which almost immediately became the Bank of Bengal. This was one of the three presidency banks, the other two being the Bank of Bombay and the Bank of Madras, all three of which were established under charters from the British East India Company. For many years the Presidency banks acted as quasi-central banks, as did their successors. The three banks merged in 1921 to form the Imperial Bank of India, which, upon India's independence, became the State Bank of India.

1.11 Difference Between Private And Public Bank Public sector banks are those where majority of the stake in the bank is held by government. The capitals of those banks are contributed by either the people or the Government of India. Government holdings are more than fifty percent in case of public sector banks. Where as in private sector bank, majority is held by share holders of the bank the major part of the stake or equity are held by the private shareholders and not by government. 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.

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Both the Public Sector and Private Sector Banks can be differentiated on the basis of the following points – • Shareholders: A public sector bank is one where more than fifty percentage of the stake is owned by the Government. In a private sector majority of the stake belong to private shareholders. • Interest Rate: Interest Rates provided by public sector bank are slightly higher compared to private sector banks. • Cost & Service: Private Sector Banks do provide better service but may cost for the extra services provided by them. For e.g. Cash pick Up, Tab Banking etc. A lot of public sector banks still follow the traditional methods of functioning. • Customer Base : The public sector banks cater to a lot of Govt Sector Departments, their salaries, fixed deposits, lockers etc. whereas private sector bank in India target Private Companies Employees, their salary accounts, credit cards and net banking.

Examples of public and private sector banks

Some of the public and government sector banks in the country include State Bank of India, Punjab National Bank, Bank of Baroda, Bank of India, Canara Bank, Andhra Bank, Syndicate Bank, Allahabad Bank, State Bank of Mysore, Bank of Maharashtra etc. Some of the larger private sector banks in the country include ICICI Bank, HDFC Bank, Yes Yank, IndusInd Bank, Kotak Mahindra Bank and a host of others.

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1.12 COMPENSATION IN BANKING SECTOR: Banking and finance sector is currently experiencing high growth rate nearly all over the world including India. With increased FDI and high inflation rates, finance sector is enjoying high deposits. Financial institutes and commercial banks are expanding their business and going for large scale recruitments. The banks are collaborating with insurance units to provide insurance coverage to their clients. Few of the banks are also dealing in gold and silver. Nationalized banks are preferred more as they provide for job security. Compensation packages in banks have always been lucrative. Incentives, special allowances, travel leaves, concessions, paid vacations, paid leaves, retirement benefits are also offered along with basic salary and other allowances such as house rent allowance, transportation vehicle etc.

Compensation package in finance and banking sector depends on the level of Knowledge and Experience an Individual has.

Top players in India such as nationalized banks- Bank of India, SBI, Indian Overseas Bank, Bank of Baroda, Punjab National Bank, HDFC, ICICI and other private banks are offering high salary packages with lucrative incentives to attract and retain their talented work force.

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COMPENSATION ON THE BASIS OF EXPERIENCE In the context of Indian Banking sector, it is seen that as age increases, the compensation also increases proportionally.

(Source:http://www.naukrihub.com/payroll/Indian-industry/banking-financesector)

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MANAGEMENT LEVEL COMPENSATION Finance sector is a promising sector where compensation is considered. The sector has witnessed 17% average increase in the salary packages in the year 2006. The compensation packages offered to managerial level employees are very much lucrative. Besides the basic salary employees are also provided with heavy perks and incentives with special allowances. They are offered club memberships, company’s vehicle, travel leaves, paid vacations, other allowances and non-monetary benefits.

Organizations also conduct training and development programs for their employees’ professional growth. Organizations provide for certification courses and online degree courses for the employees.

At higher level employees are given employee stock options. Individuals are given equal preferences on the basis of their performance.

Nationalized banks offer job security and private financial institutes provide high lucrative packages. With the globalization, liberalization, business expansion, more number of competitors, jobs in the financial sector are also demanding too much hard work. Earlier bank jobs were considered very comfortable ones but now the scenario has been changed. Indian banking sector is heading for 24*7. Some of the nationalized and private banks have started working 8 to 8.

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(Source:http://www.naukrihub.com/payroll/indian-industry/banking-financesector/)

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1.13 Private Sector Banks vs. Public Sector Banks – Salary & Benefits

Private Sector bank: The kind of remuneration offered primarily depends on the merit of an individual more than anything else. Candidates with an excellent academic background and a competitive outlook can get a higher pay package with some of the best private banks today. Perks and incentives are not an issue for those who can deliver higher levels of performance and can also be promoted in a comparatively short span of time based on their merit. Generally, a competitive work atmosphere can provide the much-needed motivation to perform better and individuals can enjoy a fast-paced career growth. However, the working hours could be longer as compared with public sector banks and job security can also be an issue, especially for lowerto-mid rung professionals. However, even top-level professionals may also not be completely safe in this sense.

Average Salaries: •

Branch Manager: INR 732,503

•

Credit Manager: INR 599,978

•

Relationship Manager: 477,734

•

Operations Manager: 475,490

•

Personal Banker: 294,791

•

Customer Service Officer: 260,000

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Public Sector Banks: For entry-level professionals, public sector banks may not offer as exciting a work experience as might be possible with their privately-owned counterparts. The pay scales are fixed for every position and pay hikes are not as frequent if compared with private banks which may not be a good enough incentive for top performers. Promotions are usually based on the years of work experience instead of merit although out-of-turn promotions can also happen occasionally. However, work hours are among the best and there is less competition or targets to meet which gives enough time to grow as a professional at one’s own pace. Job security is one of the most important advantages with public sector banks as rarely anyone is laid off, except for disciplinary reasons.

IBPS PO / SBI PO: The basic pay for PO is same irrespective of the city of appointment. It is INR 23700 w.e.f. from June 1 2015. There are a number of additional allowances making the Gross Annual CTC around INR 5,50,000 Per Annum on the lower side and INR 9,50,000 Lakh Per Annum on the higher end.

IBPS Clerk / SBI Clerk: Basic Pay: The basic pay for clerk is same irrespective of the city of appointment. It is INR 11765 w.e.f. from June 1 2015. This excludes the additional allowances which make the Gross CTCT much higher.

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1.14 Private Sector Banks Vs. Public Sector Banks – Career Pros & Cons • Private Banks Pros: Competitive Work Environment: They provide a highly competitive and exciting work atmosphere to grow as a professional. Professionals are encouraged to take up challenging tasks and enterprising individuals are rewarded accordingly.

Performance-Based Incentives: Private Banks usually offers a number of performance-linked incentives both in monetary and non-monetary forms. This promotes a spirit of competitiveness in employees and helps boost their morale further.

Instant Work Recognition: Some of the best private banks focus on recognizing merit over experience and top performers usually receives instant recognition for their work. The best thing is that recognition and rewards go hand in hand.

Hands-On Learning Experience: Greater stress is placed on acquiring necessary skills and knowledge on-the-job instead of solely relying on training programs. Although those who perform well could be selected for prestigious training programs at some of the best institutes.

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Fast-Paced Career Growth: Professionals can grow at a fast pace and acquire higher positions along with greater emoluments within the first few years. This propels even average performers to do well and keep themselves in the hunt for the next promotion.

Additional Benefits: Employees are also offered special benefits including higher rate of interest on fixed deposits and paid holidays among other things.

• Private Bank Cons:

Longer working Hours: Working hours are typically longer and the stress is on meeting targets instead of leaving office on time. This is one of the lowdowns in almost any competitive job and in the longterm, it may potentially affect the health and personal life of an individual.

Lesser Job Security: This is one of the biggest disadvantages with private banks that despite occupying the best of positions, there is no assurance that one cannot be asked to leave, if the situation demands it. Some of the possible reasons might include the banking industry or the banking institution in question passing through a bad phase. This is exactly what happened in the wake of 2008 meltdown when thousands of private bank employees were shown the door.

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Average Performers Might Suffer: Most of the job roles are cut-out for go-getters where there is little place for slow learners or average performers. Though not everyone can be a top performer but those who do not perform very well or are not comfortable taking on challenging roles may not be able to benefit much.

• Public Sector Banks pros: Less Competitive Work Atmosphere: In general, the work environment is comfortable and there is usually no rush to meet some pre-defined targets. Professionals get enough time to gear up for the role and learn things at their own pace.

Regular Training Programs: There is a lot of stress on conducting training programs at regular intervals to help employees upgrade their finance, people and technical skills and be able to perform better.

Greater Job Security: There is but little risk of sudden termination waiting around the corner even if the performance of an individual is not up to the mark. This may not sound like the best of incentives in terms of encouraging employees to do better but it certainly attracts a lot of talent looking for secure job roles. In an event similar to 2008 meltdown, there is little chance of being sent home due to market conditions, unlike private banks.

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Better Work Hours: Work hours are pre-defined and there is no rush to meet targets, no overbearing sense of competition and no additional working hours as well. It offers enough time to spend with family and friends.

Attractive Additional Benefits: In keeping with the professional designation, certain additional benefits are defined by public sector banks. These include home and a car for higher-ranked professionals along with some common benefits for most roles. These include lower rate of interest on loans, higher rate of interest on fixed deposits and pension packages among other things. However, these benefits may vary based on the professional role and the institution one is working with.

• Public Bank Cons: Less Rewarding for Competitive Individuals: A career with public sector banks could be a relatively less exciting experience for competitive individuals who are looking to achieve more in a short span of time. There would be comparatively fewer rewards for performing well and this may not work well for more ambitious individuals.

Slow Career Progress: Career growth would be rather lethargic with most of the promotions and pay hikes based on experience instead of merit. Unlike private banks, one would need seniority for desired career progress which can be a bit of a

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dampener, although there are other benefits which might compensate for it to an extent.

Lesser Motivation to Perform Better: With little competition and fewer performance-based rewards, there is but little motivation for average performers to do better and prove their mettle.

Work-Life Balance: Private Banks are relatively worse on this count with longer and intense working hours which tends to affect the balance between work and personal life. There is usually little time left for recreation or relaxation and it becomes difficult to spend quality time with friends and family. PSU bank employees have comparatively much better working hours which leave a lot of time to be spent with family, for recreation or other activities. Lesser competition at work also helps them enjoy a more balanced existence as compared with private bank employees.

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1.15 SBI BENEFITS The largest commercial bank in India, State Bank of India (SBI) come s out with advertisements almost every year to recruit in the posts of assistants and probationary officers. SBI offers an attractive package in order to attract and retain the best of talents in its fold.

The various facilities offered to an employee in the premier bank are: •

Salary Structure: The basic salary of a newly joined SBI PO is more than that of a PO who has joined in any other public sector bank because SBI offers four additional increments at the initial stage to the officers. Therefore, whatever the basic salary is for other banks, you will get more than that in SBI. For assistants, however, the basic salary is same for all the banks. Apart from this, an employee is eligible to get Dearness Allowance, House Rent Allowance, Special allowance on the basic pay and City Compensatory Allowance as an employee of the bank.

•

Contributory Provident Fund: The employees with the bank are governed

under the Defined Contributory Provident Funds Scheme in which the bank will make contributions to the PF account of the employee and as per the latest data, the monthly contribution from the bank is Rs 1641

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•

Lease Facility: The officers are eligible to get lease accommodation in their place of posting and in lieu of the lease accommodation provided by the bank, the HRA component will not be credited to the employee. The lease rental ceiling is very attractive in SBI as it pays around 30000/- for lease accommodation in Mumbai, the highest among all the public sector banks. However, there is no such facility for the clerks, as of now

•

Perquisites: Apart from salary, the officers in SBI are eligible for various perquisites like newspaper allowance, petrol allowance, entertainment allowance, house maintenance allowance, books and magazine allowance, briefcase allowance, reimbursement of telephone bills etc. The total monetary value of perquisites in the bank comes to around 5000/- on a monthly basis. The clerks in SBI are also eligible for petrol allowance, entertainment allowance, newspaper grant etc on a monthly basis

•

Medical Benefits: The employees in SBI enjoy a medical benefit scheme, unmatched in the public sector. There is 100% reimbursement for self treatment whereas 75% of the total amount is reimbursed if the treatment has been done for the dependent of the employee. Moreover, the bank has tie-up with some of the best medical facilities around the country and employees are eligible for cashless treatment in these places

•

Home Travel Concession / Leave Fare Concession: The officers are eligible for leave fare concession or leave travel concession and it can be taken in a block of 2 years or 4 years according to the choice of the employee. The officers in scale 1 are eligible for reimbursement of fare in AC II-tier of trains.

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•

Concessional rate of interest for loans: SBI employees are eligible for loan under staff scheme in concessional rate of interest for housing loans, car loans etc. Moreover, the rate of interest for deposits is also 1% more than the general public for the staff members.

•

Furniture Allowance: This benefit is exclusively for officers as the bank provides a one-time grant to the officers for furnishing of residence and also an annual maintenance charge for the same. Presently, a scale I officer is entitled to get Rs 150000 for furnishing of residence for which the bank will recover a nominal rent on yearly basis.

•

Two-year sabbatical to women staff: Women employees of SBI can take two-year sabbatical leave from work for purposes such as children's education. Apart from all these monetary benefits and perquisites, SBI offers the best promotion policy among all the public sector banks in India and it rewards its top performers accordingly by giving them challenging assignments. The learning opportunities are immense and so the opportunities of growth in both personal and professional space.

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CHAPTER 2: RESEARCH METHODOLOGY

2.1 OBJECTIVES: This project attempts to understand the following objectives: To understand the impact of compensation management on performance level  To comparatively study the compensation strategies followed in public and private bank  To assess the role of compensation management in banking sector  To understand the difference in employee’s attitude towards compensation and incentive schemes followed in public and private bank.

2.2 HYPOTHESIS: The following hypothesis have been formulated for the present study:

 Null Hypothesis H01: There is similar compensation and incentive plan in public and private bank

 Alternate Hypothesis HA1: There is different compensation and incentive plan in public and private bank

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2.3 IMPORTANCE OF THE STUDY: The significance of choosing this study is to understand the difference in compensation level at public and private sector banks. Through this study I will came to know that  What benefits and facilities banking jobs are providing to the employees?  How compensation is managed?  Where they are lacking in having a satisfied workforce presently?  How they can modify it in future?

2.4 LIMITATION: Everything has some pros and cons and so certain limitations of this study that we could observe are as follows: The area of project work is banking sector so, the data or result may be approximate as the conclusion is based on the survey method i.e. primary (filling of questionnaire from the employees).

 The organizations which have been studied and surveyed are not providing us with full information which has hampered the result and conclusion.  Exact data was not been provided.  Time consuming  Study may be obsolete because of changing environment and needs

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The present study is exploratory as well as descriptive in nature. Both primary and secondary sources of data collection have been used for collecting the data.

Primary Sources Primary data is defined as data that is collected from original sources for a specific purpose. Structured questionnaire has been prepared for the purpose of collecting primary data. The questionnaire was distributed amongst 100 Respondents which include 50 employees of private bank and 50 employees of public bank. The simple random sampling method is used. Secondary Sources Secondary data is data collected from indirect sources. Secondary source has played a vital role to play in this report. A good amount of data has been collected from various published articles. Another vital source has been the Internet and particularly the bank own website.

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CHAPTER 3 REVIEW OF LITERATURE Gaikwad & Deshmukh (2015) in their study on “HRM Practices in Selected Public and Private Sector Banks” described the issues that are involved related to HR. The authors in their study discussed about HR practices and their relation with both Public and Private sector banks. The study revealed that human resources are important part of any organization and needs to be managed effectively. Shaukat et al (2015) in their study on “Impact of Human Resource Management Practices on Employees Performance” has described that employees are important part of any organization contributing towards the achievement of goals. The aim of the study is to examine the impact of compensation, recruitment and selection, career planning, performance appraisal and selection on employee performance. The authors concluded in their research paper that it is necessary to review, revamp and rejuvenate the human resources in the organization The study conducted by Al Qudah et al (2014) on “The Effect of Human Resources Management Practices on Employee Performance” has showed the effect of human resources on the performance level of employees. The main factors which have impact are recruitment and selection and compensation on employee performance. The authors have also described that the success and failure of any organization depends on its employees. The results revealed that there is positive relation between both compensation and employee performance and recruitment and selection and employee performance. KC Chakraborty, 2012 “HR Management in Banks-Need for a new perspective” concluded that Human Resource Management is important for banks because banking is a service industry. Management of risks and Management of people are two key challenges facing banks. He has focused more on the emerging needs of HRM in banking sector in today‟s world.

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Shikha N. Khera (2010) pointed out that over recent years there has been an increasing interest in the field of human resource management. Currently, the literature encourages the consideration of human resources as strategic factors, not only because they play important role in strategy implementation, also because they are beginning to be reckoned as sources of sustainable competitive advantage. Relationships between human resource management and productivity have been studied from different perspectives. This study is an attempt to investigate the extent to which Commercial Banks of India differ on aspects of human resource management practices and the key Human Resource Practices contributing to employee productivity from a sample of 184 respondents from three commercial banks of India (one foreign sector, one private sector and one public sector bank).

Tessema and Soeters (2006) have conducted study on eight HR practices including compensation, training and other aspects. Literature indicates that the performance of the private and foreign banks have been stronger than that of public sector banks (IBA, 2008). (D‟Souza, 2002). In addition, the working environment in private sector banks has been found as growth driven, technologically advanced, and devoid of bureaucracy, where employees‟ promotions are highly contingent on their performance and merit. However, private sector banks do not provide job security and would lay off their employees in cases of poor performance or adverse market conditions.

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CHAPTER 4 4.1 Data analysis and interpretation The survey was conducted among 100 respondents. 50 of public sector bank and 50 of private sector bank.

A. Age distribution

Age of respondents Private bank

Public bank

Total

Less than 25

8

5

13

16%

10%

13%

25

13

38

50%

26%

38%

12

18

30

24%

36%

30%

5

14

19

10%

28%

19%

50

50

100

100%

100%

100%

25-30

35-45

45 and above

Total

table.4.1. age distribution of respondents

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Age Distribution

19%

13% less than 25 25‐30 35‐45 38%

30%

45 and above

Fig.4.1.age distribution of respondents Findings showed that respondents in public bank, i.e. 36% were aged between 35-45 yrs followed by the age groups of above 45 yrs and 25-30 yrs which accounted for 28% and 26% respectively. At private bank 50% respondents were in the age group of 25-30 yrs followed by 35-45yrs and below 25yrs which accounted for 24% and 16% respectively. Only 10% of the respondents were in the age group of above 45yrs, this might be due to issues relating to stress and job security. Whereas at Public bank above 45yrs accounted for 28% this situation might be due to promotions and other benefits of superannuation. The young respondents aged below 25yrs were only 10% at public bank and at private bank were 16%. This can be due to most of the public sector banks have certain selection formalities which restricts the entry level of the candidates where as at private banks the situation is different.

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B. Gender distribution

Gender

Private bank

Public bank

Total

Male

37

35

72

74%

70%

72%

13

15

28

26%

30%

28%

50

50

100

100%

100%

100%

Female

Total

table.4.2. gender distribution of respondents

Gender Distribution

28% male female 72%

Fig.4.2. gender distribution of respondents The above analysis shows that 35% and 15% of the respondents were male and female in public bank. The respondents in private bank comprise of female with 13% and male 37%.

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C. Job Experience

Years

Private bank Public bank Total

0-5

19

5

24

38%

10%

24%

23

10

33

46%

20%

33%

5

25

30

10%

50%

30%

10

13

6%

20%

13%

50

50

100

100%

100%

100%

5-10

10-15

15& above 3

Total

The number of respondents having work experience between 0-5yrs, 5-10yrs and 15&above yrs respectively. At private bank 38%, 46% and 10% were the number of respondents having work experience between 0-5yrs, 5-10yrs and 10-15yrs respectively. Whereas only 6% respondents were having experience of 15& above yrs.

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Q.1. what is the average working duration/hour of an employee in your organization? Analysis: 8hrs

9hrs

10hrs

10& above hrs

Total

3

13

16

18

50

6%

26%

32%

36%

100%

32

15

2

1

50

64%

30%

4%

2%

100%

35

28

18

19

100

35%

28%

18%

19%

100%

Private bank

Public bank

Total

Table 4.4. Average working hours of respondents Working hours

19% 8hrs

35%

9hrs

18%

10hrs 10& above hrs 28%

Fig.4.3. working hours of respondents Majority of private bank employees i.e. 32% & 36% work for 10hrs and above it. Whereas 6% &265 work for 8hrs & 9hrs respectively. Since timing are fixed for public bank majority of its employees i.e.64% work for 8hrs. Whereas 30%, 4%& 2% work for 9hrs, 10hrs and above it respectively.

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Q.2. Do you agree that shift system is convenient than adopting a fixed timing to work? Analysis: Strongly agree agree Private bank

Public bank

Total

neutral

Disagree

Total

2

17

19

12

50

4%

34%

38%

24%

100%

-

5

18

27

50

10%

36%

54%

100%

2

22

37

39

100

2%

22%

37%

39%

100%

Table 4.5. Response to whether shift system is convenient or not Do you agree that shift system is convenient than adopting a fixed timing to work? 2%

39%

22%

strongly agree agree neutral disagree

37%

Fig 4.4. Response to whether shift system is convenient than adopting a fixed timing to work. Overall 39% disagree that shift system is convenient than adopting fixed timing to work. 37% are neutral with it. Whereas 22% agree and only 2% strongly agree that shift system is convenient

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Q.3. Who handles the compensation management department in your organization? Mostly the manager and reimbursement team handle the compensation management.

Q.4. What Type Of Compensation Are Available? Analysis: Direct Private bank

Public bank

Total

Indirect

Both

Total

22

50

56%

44%

100%

8

42

50

16%

84%

100%

36

64

100

64%

100%

28

-

36%

0

46

What type of compensation are available?

36%

direct indirect

64%

both 0%

Fig 4.5. Response to type of compensation available In private bank 56% direct compensation is provided 44% both i.e. direct and indirect compensation is provided. Whereas in public bank 84% include both direct and indirect compensation and 16% direct compensation.

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Q.5. On what basis organization provides you compensation? Analysis: Base pay

commission

Travelling/housing

Any other

Total

allowances Private bank

Public bank

Total

19

2

25

4

50

38%

4%

50%

8%

100%

15

-

28

7

50

30%

-

56%

14%

100%

34

2

53

11

100

34%

2%

53%

11%

100%

Table 4.7. Basis on which organization provides compensation On what basis organization provides you compensation? Base pay

11% 34%

comission Travelling/housing allowances

53% 2%

other

Fig. 4.6. Basis on which organization provides compensation In bank majority of compensation is provided through travelling/housing allowances and base pay i.e. 53% and 34% respectively. Whereas commission consist of only 2%. It has also been observed that 24% consist of other compensation which includes medical facilities, education, etc in public bank.

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Q.6. What kind of compensation you prefer? Analysis: Monetary rewarding

motivation

Holiday

Total

packages Private bank

Public bank

Total

20

14

10

6

50

40%

28%

20%

12%

100%

25

11

4

10

50

50%

22%

8%

20%

100%

45

25

14

16

100

45%

25%

14%

16%

100%

Table 4.8. Response to kind compensation respondent prefer What kind of compensation you prefer?

16%

monetary 45%

14%

rewarding motivation holiday packages

25%

Fig.4.7. response to kind compensation respondent prefer Majority of employees prefer monetary compensation i.e.45%. Motivation is preferred by 20% of private bank employees as it consists of more young generation and only 8% of public bank employees prefer motivation as this employees have almost reached the motivation level. They prefer holiday packages more inside of it.

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Q.7. Is compensation based more on group performance and less on individual contribution? Analysis:

Private bank

Public bank

Total

Yes

No

Total`

32

18

50

64%

36%

100%

15

35

50

30%

70%

100%

47

53

100

47%

53%

100%

Table 4.9. Response to is compensation based more on group performance and less on individual contribution. 120% 100% 80% 60% 40%

no

20%

yes

0% PRIVATE PUBLIC BANK

Fig. 4.8. Response to is compensation based more on group performance and less on individual contribution.

In private bank performance is based more on group performance and less on individual contribution i.e. almost 64%. Whereas in public bank it is based more on individual contribution as they are judge on the basis of self-performance.

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Q.8. Is there any procedure of receiving formal feedback by employees on organization policies, compensation benefits and employee attitude? Analysis:

Private bank

Public bank

Total

Yes

No

Total

21

29

50

42%

58%

100%

17

33

50

34%

66%

100%

38

62

100

38%

62%

100%

Table 4.10. Response to procedure of receiving formal feedback by employees on organization policies

Is There Any Procedure Of Receiving Formal Feedback By Employees On Organization Policies? 100% 80% 60% 40% 20% 0% Private bank

public bank

Column1

no

Fig.4.9. In both private and public bank majority of employees say that yes there is procedure of receiving formal feedback by employees on organization as it helps in bringing out new ideas and improving employee’s management relationship.

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Q.9. In your organization do employees receive effective performance appraisal? Analysis:

Private bank

Public bank

Total

Yes

no

Total

28

22

50

56%

44%

100%

20

30

50

40%

60%

100%

48

52

100

48%

52%

100%

Table 4.11. Response to do employees receive effective performance appraisal in organization In your organization do employees Receive effective performance appraisal? 120% 100% 80% 60% 40%

no yes

20% 0%

private bank public bank

Fig 4.10. Response to do employees receive effective performance appraisal in organization

In private bank 56% says yes that they receive effective performance appraisal and 44% says no. whereas in public bank only 40% says that they receive effective performance appraisal and 60% say no.

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Q.10. Are you getting training for improving the performance? Analysis:

Private bank

Public bank

Total

yes

No

Total

33

17

50

66%

34%

100%

29

21

50

58%

42%

100%

62

38

100

62%

38%

100%

Table 4.12. response to do training is provided for improving the performance Are you getting training for improving The performance? 120% 100% 80% 60% no

40%

yes

20% 0% private bank

public bank

Fig.4.11. response to do training is provided for improving the performance In both private and public bank majority of employees say they get training for improving the performance as training helps in improving the skills of employees and update them from time to time.

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Q.11. Are you free to give ideas to the higher management? Analysis:

Private bank

Public bank

Total

yes

no

Total

39

11

50

78%

22%

100%

21

29

50

42%

58%

100%

60

40

100

60%

40%

100%

Table 4.13. Response to do employees is free to give ideas to higher management are you free to give ideas to the higher management? 120% 100% 80% 60%

no

40%

yes

20% 0% private bank

public bank

Fig.4.12.response to do employees are free to give ideas to higher management Majority of private bank employees i.e. 78% say that they are free to give ideas whereas 22% disagree with the same. In case of public bank majority say that they don’t get chance to give ideas to higher management.

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4.2 CONCLUSION Banks play a crucial role in determining the economic wellbeing of an economy and the same is true for India also. In its context, we find the segment differentiated into segments like the public and the private sector. Post liberalization phase has seen a massive change in the working of these institutions. All of them have realized the cut throat competition and for the same, they all are focusing on excellence in performance in all spheres of work. To ensure the same with the workforce, a sea change has been seen in the human resource policies of the banking sector. This becomes the reason why the compensation schemes have been modified. Earlier, basically the direct component on the compensation formed the essential part of the payment. Now also it is so, but the components of direct compensation have been modified. The idea is to drive excellence, and for this, concepts like incentive component, sales based commissions among others are gaining prominence in determining the magnitude of net compensation of a bank staff. Satisfaction level of employees from general working conditions is almost equal but private sector employees are dissatisfied due to less flexibility and location of work. Hence public sector employees are more satisfied than private sector employees. Due to not having opportunity to learn new skills and not proper training here, dissatisfaction exist among public bank employees whereas private sector are extremely satisfied due to proper training and having opportunity to learn new skills timely. Thus, private sector employees are more satisfied than public sector employees in this matter. Private sector are dissatisfied because their company provides the

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benefits they need but not providing benefits their family needs. Public sector employees are satisfied due to their company provides benefits that compare favorably with other companies in the industry. Hence public sector employees are more satisfied than private sector employees.

In this literature survey, the researchers established that employees in the public sector have compensation premium than their private sector counterparts. However, in comparison to the compensation paid to state and local government workers, the private sector compensation and benefits are higher than the former. As regards performance incentives and benefits in public and private sectors, the private sector incentive packages are competitive and tied to performance indices. While the goals and objectives of the private sector are usually quantifiable which are usually linked with performance incentives those of the public are nonquantifiable. Also, executive compensations like stock options and non-managerial incentives like profit-sharing, the piece-rate system are not obtainable in public sector employments. The literature survey indicates that fringe benefits in both the public and private sectors are paid to employees as indirect compensation having no bearing to performance or productivity improvements but as remuneration tool to reward employee membership of the organization and as staff retention strategies and encouraging employee commitments. It has also analyzed that compensation management is very important for employees but it should be linked with their productivity. The employees in the bank are less aware about the prevailing compensation policies in different banks the bank should make use of both monetary and nonmonetary incentives to motivate the employees.

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CHAPTER 5 SUGGESTION AND RECOMMENDATION FOR PUBLIC BANKS: Though The Employees of Public Banks are much more satisfied than private bank employees but there are always chances of improvement. Public banks can take steps to keep its employees more satisfy as follows:

Recognition for work accomplished by employees is less in public banks, so banks can provide recognition by giving rewards on timely basis, by praising employees in meetings, by sending letters of good worker to their homes.



Public banks can provide opportunity to learn new skills with the help of training and education programs weekly for 2-4 hours.



As duties of employees in public banks remain same, employees feel boredom, so banks should provide variety of job responsibilities and adequate opportunity for periodic changes in duties.

FOR PRIVATE BANKS: ¾ Most important cause of dissatisfaction in private employees is of job security. So, private banks must provide an element of security to employees. Banks can provide security in terms of conditions that until employee will fulfill these conditions; his/her job will remain secure.

¾ The Indian middle class is very protective towards family members, so private sector banks must launch special schemes to safeguard the

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interests of family members of employees. This may be education facilities for children, pension schemes for employees, accommodation for employees, gratuity, and other retirement benefits.

¾ Due to the different social, economic and cultural backgrounds, the hire and fire system is not effective in India. In fact, Indian culture is neither individualistic nor collective, rather it is "Karma" (according to Indian mythology it is do your duty, don't worry about results) oriented. Indians always accept effective leadership. So when management can provide effective leadership and a secure job environment, Karma (job duty) will be in the right direction.

General suggestions for any organization to keep its employees satisfied are:

Performance incentives and fringe benefits should be competitive, fair and equitable to employees in both the private and public sector as much as possible.



Public Sector Banks can increase the satisfaction of their employees by increasing the pay increments, and employee involvement.



Since the employees of public sector bank have lower level of satisfaction with training and development facilities, these Banks should take steps to improve training and opportunities for career advancement. To increase the level of satisfaction employees of it is necessary to improve policy for career development.

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

Job satisfaction and dissatisfaction of Bank employees should be evaluated periodically for evolving dynamic policies for organization's growth and development.



The employees should be given proper allowance facility, salary and job security according to the market trend. The objective of the bank should be linked with the objective of the individual so that both the objectives are accomplished and employees feel motivated to work.



The needs of the employees should be determined and accordingly be accomplished by the banks through different motivational techniques. The bank should make use of different nonmonetary incentives also so the employees feel connected with the bank.

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BIBLIOGRAPHY http://directfrommind.in/effect-of-advertising-on-consumers/ https://digiday.com/marketing/advertisingweek2015-the-5-stages-of-advertising-week/

ANNEXURE 1. What is the average working duration / hour of an employee in your organization? 8 Hrs 9 Hrs 10 Hrs Above 10 Hrs 2. Do you agree that shift system is convenient than adopting a fixed timing to work? Strongly Agree Agree Neutral Disagree 3. Who handle the compensation management department in your organization?

4. What types of compensation are available? Direct Indirect Both 5. On what basis organization provides you compensation? Base pay Commission Traveling / housing allowance Any other specify ___________________ 6. What kind of compensation you prefer? Monetary Rewarding Motivation Holiday Packages 7. Is compensation based more on group performance and less on individual contribution? YES NO

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8. Is there any procedure of receiving formal feedback by employees on organization policies, compensation benefits and employee attitude? Yes No 9. In your organization do employees receive effective performance appraisal? Yes No 10. Are you getting training for improving the performance? Yes No 11. Are you free to give ideas to the higher management? Yes No

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