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Monday, April 4, 2011

Leadership and Performance in the Banking Industry

Introduction

Most of the organizations rely on the effectiveness of the roles played by each person. Under the umbrella of an organization, people move according to their given tasks and place an effort to fulfill or satisfy the organization’s objectives. On the other hand, people are also guided by the invisible hand of the leaders. Those leaders are the role models in every organization and justify the results through the performances of his people.

Background and Statement of the Problem

An emerging concern on the participation of the leadership within an organization drew attention to the past business analysts and researchers. In fact, successful organizations create interesting evidence that contributes to the idea, that on some point, the influence of a leader can affect the potential and the performance of his employees. Through an effective leadership, various areas in the organization such as technological innovation and human capital can be well facilitated. However, what are the most common effects of leadership towards the performance of the people most especially in banking industry?

Research Objectives

The first objective of the study is to determine the level of the leadership within the organization, such as identifying the strategic leadership styles that the bank managers apply. Second is to identify the influences of the leadership on the performance of bank’s employees similar to recognizing the areas of the employees’ work improvement.

Research Questions

The study is concern on the leadership styles or management of the leaders. Therefore, there are several questions that are entirely focused on the leadership on the performance in banking industry.

1. What is the most common type of leadership style or managerial style applied by the managers in banking industry?

2. What are the perceptions of both managers and employees about the leadership within the organization?

3. What would be the possible effects if there is no existing leadership in banks?

Literature Review

Banking industry has grown competitively because of their superior financial performance. The nature or their organization is extremely different from the industrial organizations and the people are incorporated in the area of services. Past studies stated that the leadership is linked in mastering the appropriate workforce management that is the main key to have the capabilities to top in their performances. An effective talent management is great evidence on having a strong employee engagement. In addition, the advantage of the organization to acquire their talents can attract the flexibility in terms of financial services. Such example can be on the people’s performance in the midst of the financial and economic crises wherein the effective leader can influence the performances of the employees to work together in outperforming their competitors. Business leaders viewed the importance of the workforce as their business partners therefore; they managed well their people with care to satisfy their progress. Leadership styles can be seen on the different initiatives the leaders give to their HR and training and development. Through the use of the appropriate strategy in managing the people, the adjustment on the side of the employees can be made and measured based on their performances (SAP, 2005).

Various benefits of the leadership can be also assessed on the investment, earnings, rate of return, and overall growth of the banks in the market. In the collaboration of the leadership and performances there are positive macroeconomic growth and regulatory effects in the system that can accommodate the stability of the organization’s performance (MERISTEM, 2010). In addition, the leadership can lead to the development of the organization. The development can be in terms of the skills of the people, managerial styles, marketing concept and principles, service, and technical management (Wahab, Noor, & Ali, 2009).

Methodology

The applied method in the study is the use of the comparative case study. Since there are various studies pertaining to the leadership and performances, it is a great advantage for the study to consult the past literatures. The applied method allows the study to review, compare, and assess the different point-of-views or theoretical approach that is applied in most of the organization. An opportunity is given to the study wherein the researcher/s has to relate the past literatures on the current status of the banking organization and generate its own analysis.

Conclusion

The leadership within an organization is viewed as a strategy that can drive the entire organization in achieving the success. Basically, the banking industry understands the complexity of their business environment. In addition, the employees valued the importance of the leadership in creating an influence through their performances.

References:

MERISTEM, 2010. Banking Industry Report in Nigeria, Africa [Online] Available at: http://www.proshareng.com/admin/upload/reports/MERISTEM%202010%20BANKING%20REPORT.pdf [Accessed 10 March 2010]

SAP, 2005. Banking Though Leadership Series: Building a High Performance Workforce [Online] Available at: http://www.sap.com/france/industries/banking/pdf/thoughtleadership.pdf [Accessed 10 March 2010].

Wahab, S., Noor, N., & Ali, J., 2009. Technology Trust and E-Banking Adoption: The Mediating Effect of Customer Relationship Management Performance. The Asian Journal of Technology Management, Vol. 2, No. 2 [Online] Available at: http://www.sbm.itb.ac.id/wp-content/uploads/2010/01/AJTM-Vol-2-No-2-2009.pdf [Accessed 10 March 2010].

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