Title, Background and Definition of Issues

Human resources play a critical role in the performance of any given organization, especially attainment of the set mission, vision and corporate objectives (Marks & Philip, 2011). Effective management of the human resources in a firm ensures high level of motivation and productivity, leading to optimum performance and output. The human resource management function entails maintaining, enhancing and improving human resources in the organization through effective planning, execution, monitoring and evaluation of the relationships among employees, developing and improving human resource policies, designing programs and practices to ensure attraction, recruitment, retention, growth, development and performance of the people in the organization (Marks & Philip, 2011).

The main roles of the human resource professional include developing the corporate organization culture, solving the human resource problems, agents of change in the organization, administrative roles including formulating policies, housekeeping, maintaining employee records and ensuring adherence to legal and ethical requirements. Human resource professionals also have a role of maintaining diversity in the workplace, and ensuring employee motivation (Kandula, 2003). These and many other roles imply that the human resource practitioners have a very challenging task and role.

 This study focused on the issues facing human resource professionals in the contemporary workplace. The working title for the investigation was: Issues of human resource management. The biggest challenge facing the human resource professional is how to ensure full utilization of the employee capabilities, skills and competencies in an efficient and effective way while creating a conducive environment to nurture work-life balance.

Today, the human resource professional must deal with several issues while managing the workforce including unnecessary inefficiency, inadequate knowledge among workers and challenge of leadership development (Jones & Martain, 2013). These issues are critical because they influence and affect the efficiency and effectiveness of the people in the organization.

Justification 

It is important to study the issues identified above because they ultimately affect the performance and survival of any organization. Today, there has been a significant shift from a manufacturing to a knowledge economy making strategic management of people critical to attainment of organization objectives. Unfortunately, the lack of knowledge and existence of incompetent employees in the organization means that human resource professionals have an uphill task and significant challenge in managing the people. Moreover, lack of knowledgeable workers implies that the organization would not be able to achieve competitive advantage in the highly challenging global environment with fierce rivalry among industry players.

Justification, Aim, objectives and research question

Inefficiencies in the organization results into wastages of time, financial resources and manpower, which leads to deteriorating productivity and low profitability for the organization. In addition, poor leadership development means that organizations are struggling in conducting succession planning and motivating employees to take on bigger roles, positions and responsibilities in the organization. Clearly, the issues identified in this study are critical to the success and sustainable performance of the organization. This implies that the human resource professional is under significant pressure to address these issues, create a dynamic environment, and responsive work culture to nurture exceptional organizational performance.

Aim 

This study sought to investigate and analyze the issues that human resource professionals face including inefficiencies, inadequate knowledge among workers and leadership development.

Objective 

1. To identify issues faced by human resource professionals in banking sector in Australia

Research question 

What are the issues affecting human resource professionals in the banking industry in Australia?

Overview 

This section of the report provides the theoretical background underpinning the study, a critical review of the previous literature on the issues facing the human resources professional, the gaps in the literature creating opportunities for further studies and the conceptual framework informing the study.

Human resource refers to the people, employees or staff who engages in the daily operations of the organization (Huselid, Becker & Beatty, 2005). It is also a collective terms referring to the activity or process of managing thew people in the organization (Huselid, Becker & Beatty, 2005). There has been a growing focus where employees or workforce in the organization is considered as the human capital (Heckman, 2000). Hence, employees are viewed in terms of assets, rather than merely costs to the organization and their contribution create competitive advantage. This premise is based on the argument that productivity can be enhanced through investment in people and creating opportunities for learning and development (Nafukho, Hairston & Brooks, 2004). Employees are also considered as human assets critical to the success of the organization (Coff, 1997). This is particularly important with the shift from manufacturing to service and knowledge economy where the employees possess the skills, knowledge and competence necessary for the creation of sustainable competitive advantages of the organization.

Human resource management refers to the strategic and planned approach of managing the people, who form the organization’s most important assets (Hendry, 2012). Recently, literature on the field has focused on the strategic approach to human resources management with the argument that for the organization to achieve its core objectives, the management of the people has to be strategic (Daley, 2012). Moreover, it is important to integrate the strategies for managing human resources in the overall strategy to attain sustainable organization performance (Wright & McMahan, 1992). Strategic human resource management uses different strategies to improve employee performance through investing in efficiency and effectiveness, creating a learning and knowledgeable workforce, succession planning and leadership development (Wright & McMahan, 1992).

Literature Review

Theoretical Background

In their study, Wright and McMahan (1992) explored a range of theories suitable for strategic management of the human resources in the organization. These theories range from systems theory, institutional theory, contingency theory, resource-based theory and behavioral theory. Among these theories, the resource-based theory is suitable for investigating issues facing the human resource professionals in the organization. The resource-based theory is based on the assumption that human resources are strategic and critical to the attainment of sustainable competitive advantage in the organization (Festing & Eidems, 2011). It is important to implement various strategies to develop the human resources in the organization to leverage their skills, competence and capabilities to drive organization performance (McWilliams,Van Fleet & Wright, 2001). Human resource managers implement internal strategies such as gap analysis to identify internal performance gaps using tools such as SWOT analysis, benchmarking, leadership training and development with the aim of developing a high performing workforce (Eisenhardt & Martin, 2000).

Critical Review of Literature 

Human resources are critical to the success of organization. A number of scholars have investigated the concept of human resource management and its implications for organization success. According to Zafar (2010) the rise of the knowledge economy and highly complex organization networks have necessitated the introduction of electronic human resource management to address the demands and needs of employees and management while addressing the human resources challenges of the 21^st century workforce. This study highlights the potential of information technology and its role in streamlining human resource management practice, transitioning the human resources to becoming strategic business partners and shaping the competence of the human resource professionals (Zefar, 2010).

 Role of human resource professional

The human resource manager undertakes several roles and responsibilities in the organization. The most common role is identifying, recruiting, developing and retaining the right talent in the organization.  According to Jackson, Schuler & Jiang (2014) human resource management focuses on recruitment, managing and giving direction to the people in the firm, and dealing with issues such as compensation, management of performance, organization development, workforce motivation, workplace safety and security, among others. Gberevbie (2010) opines that recruitment is a critical function of the human resource management function that affects significantly on the organization performance. This study highlights the effective strategies that human resource professionals must use to attract and recruit the right talent to ensure the right pool of people, manage and retain them for sustainable organization performance.

Another critical role performed by the human resource professional is planning of the human resources. Organizations, irrespective of their status as public or private sector, must endeavor to find the right people with the right skill sets to fill organization positions (Jackson & Schuler, 1995). In light of the changing organization environment, globalization, shifting demographic trends, competition and changing technology, organizations must engage in effective planning to address human resource challenges and concerns and identify lasting solutions to organizations human resource issues (Jackson & Schuler, 1995). Workforce succession planning is a critical component of people management that affects the motivation of employees and enables the human resource professionals to predict and meet the future needs of the organization. The lack of effective succession planning affects the organization negatively through lowering employee motivation, creating unhealthy office politics and poor development of future middle and top leadership in the organization (Jackson & Schuler, 1990). Beheshtifar and Nekoie-Moghadam (2011) emphasized on the importance of identifying, attracting, measuring, developing and improving human intellectual capital assets. Investing in the improvement of employee competencies is critical to the attainment of competitive advantage in the organization.

In today’s competitive environment, human resource managers experience a wide range of issues in managing the workforce. The key issues addressed in this study include unnecessary inefficiencies, inadequate knowledge among workers and inadequate leadership development.

Unnecessary inefficiencies

Organizations are struggling with the problem of inefficiency in the workforce, which has a significantly negative impact on performance. The biggest challenge that human resources professionals deal with is on how to address the issue of inefficiency in the workforce. Inefficient workforce management lowers employee productivity, leading to increased costs and poor performance of the organization (Randolph Thomas & Horman, 2006). Dovlo (2005) investigated issues of inefficiencies and wastages among health workers in African countries. According to the study, wastages arising from misapplied skills, lack of support, absenteeism and inadequate supervision were common in African countries often resulting in loss of productivity and output of the health professionals.  The author proposed a range of interventions to address the issue of inefficiency, including development of indicators for monitoring, evaluating and managing wastages and inefficiencies, enhancing morale and motivation of employees and establishing moral leadership (Dovlo, 2005).  

According to Gopalakrishnan (2012), inefficiencies in organizations arises due to skills deficiencies among employees that lowers productivity and leads to wastages of money, time and people ultimately contributing to low performance of the organization. The author opines that organizations can use key performance indicators for assessing employee performance and getting rid of the inefficient ones (Gopalakrishnan, 2012).  Cho, Woods, Jang and Erdem (2006) argue that employee efficiency results from their knowledge, motivation, workplace environment, capability and competence. Consequently, the absence of these variables or their inadequacy implies that the employees experience inefficiencies resulting into low output and productivity in the organization. Employers boost efficiency through workforce reduction to cut costs (Wagar & Gilson, 1996), motivation to build morale of staff (Muscarella & Vetsuypens, 1990), innovation and automation to cut down inefficient tasks and installing monitoring systems to supervise employees (Youndt, Snell, Dean & Lepak, 1996).

Inadequate knowledge among workers 

Today, there is a significant emphasis on the knowledge workers as a strategic competitive advantage of organizations. Knowledge management entails creating, harnessing, developing, sharing and utilizing both tacit and explicit knowledge at the individual, group and organization level through effective management of human resources (Gold & Arvind Malhotra, 2001). It entails creativity and innovation driven by the knowledge people in the organization, often with the organization vision and support. Smith and Kelly (1997) opine that organizations strategic advantage lies in their ability to attract, develop and retain a talented and knowledgeable set of employees in the market. Unfortunately, the biggest challenge facing the human resource profession is the continued emphasis on information technology issues at the expense of the people issues in the organization (Oltra, 2005).

The biggest hindrance to effective harnessing of the potential of knowledge workers lies in the fact that the employees have inadequate knowledge in the first place. Most organizations are lagging behind in terms of creating learning culture that supports continuous education and training of their employees (Gopalakrishnan, 2012). The lack of continuous skill development among employees results into incompetent workers, creating barriers to attracting and retaining the right talent and sustaining the organization’s performance and competitive advantage (Gopalakrishnan, 2012).

Inadequate leadership development 

Human resource management and organization performance depends significantly on the development of future leaders. Unfortunately, the lack of effective succession planning affects motivation of employees and leads to incompetent middle and top managers, ultimately resulting into poor performance of the organization (Gopalakrishnan, 2012). Farashah, Nasehifar and Karahrudi(2011) investigated the effects of succession planning on the career development attitudes of workers in Iranian government organizations. The authors reported significant correlation between effective succession planning and job satisfaction and career success (Farashah, Nasehifar & Karahrudi, 2011). Clearly, succession planning is to the center of organization performance and success (Groves, 2007). Hence, adoption of poor strategies or lack thereof of succession planning affects organization productivity and performance negatively.

Gaps in Literature Review 

Although there is an incredibly large focus on the issues affecting and influencing the human resource professionals, several gaps still exist that require further research considerations. This literature review reveals that unnecessary inefficiencies, inadequate knowledge among workers and inadequate leadership development remain the biggest challenges facing the human resource profession (Randolph Thomas & Horman, 2006; Oltra, 2005; Gopalakrishnan, 2012). However, there were no studies specifically investigating these issues in the banking sector. Moreover, there was no literature on the effects of these issues for employees working in Australia. Therefore, the focus of this study was to fill the gaps in literature through investigating the effect of unnecessary inefficiencies, inadequate knowledge among workers and inadequate leadership development on human resource management in Australian banking sector.

This study was based on a secondary data on the issues of human resource management affecting the performance of organizations in the banking sector in Australia. Hence, the researcher relied on extensive review of secondary data relevant to the topic under investigation to identify the various issues affecting human resource management their implication for banking sector in Australia. The importance of using secondary data has been documented and includes readily available data, less time and lower cost in collecting and analyzing data as compared to primary data collection (Stewart & Kamins, 1993). Therefore, secondary sources were used to attain the aims and objectives of this study.

The Google search engine was used for the purpose of identifying and selecting the secondary sources for this study. The researcher utilized descriptors and keywords including:

1. Employee  inefficiencies in Australian banks
2. Inadequate knowledge among workers and performance of banks in Australia
3. Inadequate leadership development in Australian banks

The search was limited to peer reviewed journal articles published between 2014 and 2016. Articles published before 2014 were excluded from the study. Conference papers and books were also excluded from the study since they did not meet the selection criteria.

1. Employee inefficiencies and performance of banks in Australia

This search returned 16,900 results. None of the articles specifically addressed the issues of employee inefficiencies in Australian banking sector. Since none of the articles met the inclusion criteria, they were all rejected.

2. Inadequate knowledge among workers and performance of banks in Australia

A Google search of this keyword returned about 15,800 results. A careful evaluation of the results to make sure compliance with the inclusion criteria was conducted.  Only three articles were found to be relevant.

3. Inadequate leadership development and performance of banks in Australia

A Google search using these keywords returned 15,700 results including books and journal articles. A careful review of the abstracts was conducted to ensure that only articles that met the inclusion criteria were selected. Only three articles were found to be relevant to the study.

Only six articles were found suitable for the analysis of human resource issues in the Australian banking sector. One article by Kotey and Sorensen (2014) was found to be relevant in both inadequate knowledge among workers and inadequate leadership development. no article was found for the employee inefficiencies in the Australian banking sector. The table below shows the articles by the topical areas.

Topical classification of articles

Topic	Reference
Employee inefficiencies in Australian banks	No literature
Inadequate knowledge among workers	Connell and Stanton (2014); Georgiou (2015); Kotey and Sorensen (2014)
Inadequate leadership development	Montague, Larkin and Burgess (2016); Kotey and Sorensen (2014); Willcocks and Reynolds (2015)

Montague, Larkin and Burgess (2016) examine the challenge of inadequate leadership in Australian banks. According to the study, there was a significant failure on the human resource management aspect of the organization especially concerning the ethical behaviors of employees in meeting and addressing the needs of the clients. According Montague, Larkin and Burgess (2016) the employees were ineffective in treating clients and this exposed the banks on reputation risks, which were likely to affect their performance.

Moreover, Georgiou (2015) raised issues of employee aging, inadequate human resource policies and challenges in attracting, recruiting and retaining older employees as a challenge for human resource management, especially in managing knowledge workers. As the older people retire and exit the workplace they leave with their tacit and explicit knowledge hence creating a challenge of sharing and harnessing this knowledge.

Another important finding from this study was derived from Kotey and Sorensen (2014), which touches issues of inadequate knowledge among workers and inadequate leadership development. While the study did not specifically mention the banking sector, it was presumed that the banks fall within the small businesses that was the target audience. The authors highlight issues such as skills shortage and dependence on resources such as technology. It follows that without appropriate and relevant skills, and the reliance on information technology limits the focus on employee development thus limiting their performance. Connell and Stanton (2014) was included because the authors cite issues of skills shortage and gaps in the Australian context and specifically mentions interventions that can reverse these trends, including linking education, industry and stakeholders to reduce the issue of skills shortage and foster development of skills among employees. Similarly, Willcocks and Reynolds (2015) suggest that overreliance on technology at the expense of human resource development remains the biggest challenge for the Australian banks.

Conclusion and future research considerations 

The issues of human resource management pervade the banking sector in Australia.  This paper reviewed only 5 articles on the issues of employee inefficiencies, inadequate knowledge among workers and inadequate leadership development among employees in Australian banks. The reasons for the few articles are because a few studies have specifically addressed these human resource issues in the context of Australia banking sector. Nevertheless, the findings are consistent with the evidence presented in literature concerning the issues of employee management in other countries and industries. Despite this, it would be difficult to generalize these findings to the entire banking sector in Australia due to shortcomings of secondary data and the relatively few sourced researched in this paper. Since this is only a secondary research, it forms basis for future research using primary data. Primary research would be able to collect actual data to inform these critical aspects of human resource management. Investigating the issues of employee management in Australian banks using primary research and qualitative data is highly recommended in order to generate insights, develop appropriate knowledge and understanding of the trends and best practices in addressing these issues.

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