STRATEGY FOR THE IMPLEMENTATION OF INVESTORS IN PEOPLE IN THE BANKING SECTOR
The purpose of the Investors in People strategy is to discharge the BANKSETA’s commitment to creating an enabling environment for organisations within the banking and micro-finance sector as well as to provide the overarching frame of reference for the operational management of the BANKSETA’s Investors in People initiative.
This strategy document has been compiled consultatively and sector input has been solicited.
It should be noted that operational work in implementing the initiative continues with considerable momentum. The strategy adopted is informed by this activity, and the operational activity will be consolidated and focused with reference to the strategy once adopted.
While this strategy is specifically the strategy of the BANKSETA, it is necessarily also the strategy in great measure governing the sites which have elected to accept BANKSETA support and so to become part of the BANKSETA strategy. This is not to deny that organisation-internal strategies do not also properly govern the sites, but to recognise that the sites in their implementation of IiP must perforce take due cognisance of this strategy and its entailments. Implementation of the strategy therefore rests not only with the BANKSETA but also with the participating sites. A close and committed partnership between the BANKSETA and the sites involved is therefore an inevitable prerequisite in realising this strategy. Implicit in this view, however, is that this strategy in no way seeks to direct or constrain the activities within individual enterprises or sites in their journey towards recognition.
The implementation of IIP in the banking sector is variously described in this document as a programme or an initiative, in recognition of its broad scope and evolving quality. It is envisaged that the programme will spawn a variety of projects.
For ease of reference, this document is presented in three sections:
1. The context of the strategy for the IIP programme.
2. The IIP programme objectives and their measurement.
3. Strategy implementation.
Section 1: The context of the strategy for the IIP programme
1.1 Investors in People in the context of BANKSETA strategy
It is important to appreciate the organisational context for the IIP strategy, which is indeed the super-ordinate strategy for BANKSETA itself.
The super-ordinate BANKSETA strategy intends to address pressing skills-related issues within the sector. The strategy rests on three pillars:
# Statutory and administrative duties – comprising the administration of grants and routine statutory BANKSETA activities.
# Enhancing the intake base – which addresses the intake of new entrants into the sector, primarily through learnerships, and the need to ensure that the BANKSETA is promoting the Banking Council aims of transformation.
# Enhancing training and education within the sector – achieved primarily through the ETQA function and the IiP initiative.
It is important that the status of the IIP programme be recognised, not merely as one of a host of initiatives, but as a core element of this aspect of the BANKSETA strategy.
1.2 Important considerations underpinning the IIP strategy
Emergent considerations in respect of the IiP initiative that shape the BANKSETA’s IiP strategy are outlined below.
1.2.1 The sector market: Ensuring that the markets being served by the products and services are clearly defined and understood is important in any decision-making, and is particularly important in relation to determining appropriate sector strategies.
# The market has been defined as consisting of the big banks on one hand and SME’s one the other, in recognition of the fact that the internal capabilities and needs in these two categories will be different in some ways.
# The services offered will be determined by emergent needs in each of these two market segments, given that neither segment is an exclusive focus of the initiative. Differentiation in services rendered will occur when there is no viable alternative.
1.2.2 IIP brand positioning - the programme will require that the IIP brand be appropriately positioned at a sectoral level. Concretely, this implies:
# IIP and the Banking Charter: Every attempt should be made to position the Investors in People Standard within the Banking Charter. This will help to ensure that IIP is lent appropriate authority to support all stakeholders with regard to their people development strategies. IiP is an initiative with demonstrable benefits for a large population delivered relatively cost-efficiently.
# Selling IIP on comparative value: It will be important for the BANKSETA to encourage IIP targets in the sector in relation to other initiatives on the basis of what achieves the optimum levels of return on investment in the views of all stakeholders, with benefits to employers and employees (being the BANKSETA’s prime constituency) enjoying priority. That is to say, all development initiatives need to be reviewed on a pragmatic performance per rand basis to ensure that the industry receives the best value for its investment.
# Communication and marketing exercises will seek to achieve the required positioning and emphasis for the initiative in these respects. It is specifically recognised that the South African public tends to put great faith in the good management of banks and is likely to respond favourably to banking initiatives which bear a strong business brand, but that the same public objects to evidence of prodigality on the part of banks and is likely to respond unfavourably to initiatives which do not demonstrably make business sense.
1.2.3 Economic analysis of alternative BANKSETA delivery support scenarios
The programme strategy must be considered on the basis of the value it is likely to add. In this regard there are several possible scenarios:
# Neither BANKSETA nor the sector organisations do anything. There would be no cost to the sector or to the BANKSETA, and nor would there be benefits. BANKSETA resources and funding would be deployed elsewhere.
# BANKSETA does everything that is required. This would benefit IIP implementation across the sector and achieve commensurate business benefits. However, in doing everything, costs to the BANKSETA would consume all resources, while costs to the sector would be higher than the current levy.
# The third scenario would be a compromise seeking to balance the benefits against the investment, with the aim of providing the sector with the most cost-effective option at a realistic investment level by the BANKSETA. In this scenario the BANKSETA would deploy reasonable resources to “kick-start” IiP in the sector and further incentives to its constituency to retain IiP recognition.
The programme is proceeding on the premise that the third scenario is the most desirable one.
1.2.4 Competitive positioning:
# The business case for the entire initiative rests upon the premise that IIP will drive competitive positioning.
# The national agenda as articulated by the Department of Labour relates to transformation. IIP is seen as a tool to make the South African workforce more competitive. It is a specific premise of the BANKSETA policy that this view is correct.
# The banking sector has also espoused the IIP Standard as a means to give it a competitive edge by assisting the industry to become a preferred employer as the competition for talent increases. This in turn calls for active public positioning of IiP such that it will be perceived as the hallmark of a preferred employer and creation of a public perception that the banking sector at large is, as it were, an “IiP sector”.
Any strategically- oriented action must therefore be tested against these criteria.
1.2.5 Cultural analysis: The constituent organisations of the BANKSETA include a continuum of organisations ranging from the corporate enterprises in formal banking to the micro-finance SMMEs. The culture of each of the two broad components of the sector will influence the effective execution of the programme.
A cultural analysis of the formal banking sector suggests the following:
# The banking sector is predominantly a white- collar environment which implies a sophisticated and educated industry, which emphasises the need for talent and the generation of a sophisticated skills base.
# The large bank segment is well-endowed with HR capability. The sector generally has extensive capacity and facilities for human resource development.
# Generally speaking it is a wealthy sector with considerable resources which presents great opportunities.
# The sector has a strong desire to be on the leading edge globally. On the one hand this makes it very receptive to any initiative that supports that desire, but on the other, the “not invented here” syndrome frequently prevails.
A cultural analysis of the micro-finance sector suggests the following:
# The sector has a strong entrepreneurial bias.
# It is in the process of consolidation.
# Skills development manifests itself at relatively high ownership and management levels but not necessarily at lower levels.
# HRD is generally not a dedicated function but is one of many line functions.
1.2.6 Sectoral SWOT analysis: A SWOT analysis of the current situation suggests the following:
Aspect / AnalysisStrengths / · Good HR infrastructure in big banks
· BANKSETA funding for IiP implementation as a priority
Weaknesses / · ‘newness’ of IIP SA infrastructure
· lack of exposure
· Aspects of traditional culture – e.g. authoritarian
· Unreliability of EU funding
· HR infrastructure in SME’s
Opportunities / · Grant system
· Enthusiasm for benchmarking and the achievement of good practice
Threats
/ · Executive management disinterest
· Perceptions of DoL involvement in IiP
The strategy aims to capitalise on strengths, exploit opportunities, counteract weaknesses, and guard against the impact of threats.
Section 2: Programme objectives and measurement
2.1 IIP Programme Objectives
The BANKSETA views the Investors in People programme as being of benefit to all employees and employers in the South African banking sector. A three-phase approach to promoting the Investors in People standard in organisations in the banking sector is recommended.
The target for phase one of the proposed project in 2002/2003 is 40 sites, bearing in mind that a site will be either a company or a relatively autonomous business unit or operating entity within a company. The BANKSETA will promote a building- block approach in large organisations as the UK experience is that this is far more easily achievable in large organisations than going the whole organisation route. In small organisations it is seldom worth trying to distinguish multiple sites.
Phase two will sponsor proliferation via IiP SA in 2003/2004 and will include organisations sites employing a further 1/3 of employees in the banking sector.
Phase three targets the remainder of the sector by the end of 2010. This should be seen as a notional objective only for strategic purposes, since the target population in this instance inevitably will exclude specific organisations.
It is noted in achieving these objectives, BANKSETA will have far exceeded NSDS targets. It is crucial that the BANKSETA will take pro-active steps to ensure that IiP will be and remain established as a crucial element of the NSDS and that all possible benefit accrues to its constituency in consequence of exceeding NSBS targets.
2.2 Programme measurement and incentivisation
A variety of programme measurement tactics will be adopted in order to monitor progress and identify requirements for remedial action or opportunities for enhancement.
Suitable measures fall into three categories:
Level of measurement / Appropriate measuresStrategic / · Numbers of employees in enlisted organizations vs. strategic objectives
Tactical / · Progress against programme plan
· Sector satisfaction
Operational / · Progress of sites against pre-defined milestones.
· Site assessment results.
· Site satisfaction.
· Evaluation of specific projects using appropriate measures.
2.2.1 Progress on sites. For sites to remain committed and effective it is important that they are able to keep in touch with their own progress in the most cost-effective way. This is particularly important in the period leading up to the diagnostic assessment. To assist with this challenge it is suggested that the possibility of having computer software developed to enable sites to effectively monitor their own progress and evaluate their status prior to engaging in a formal assessment with all the costs involved should be explored as part of the explicit role of the BANKSETA IiP manager.
2.2.2 Monitoring progress with the strategy. The BANKSETA is empowered by legislation (viz. PFMA) to request site progress reports in respect of sites supported by BANKSETA funding and resources. To expedite such reporting, sites using consultants paid for out of BANKSETA support funding will be able to present to the BANKSETA the same written reports and recommendations which the consultants will be required to present to the sites from time to time. Supported sites not using consultants will be required to generate the same written reports for submission to the BANKSETA themselves, failing which they will be required to pay for a consultant appointed by the BANKSETA to co-operate with them in producing such a report. Unfunded sites will be under no obligation to present such a report but will be asked to volunteer progress information. The requirements of future statutory reports will most likely include an indication of the number of employees working in areas currently enjoying IiP accreditation, the number of employees working in areas actively engaged in pursuing IiP accreditation, and designations of areas enjoying current IiP accreditation if in fact the entire organisation does not.
2.2.3 Actual formal assessment. The IIP process demands assessment for accreditation and this in itself should provide an incentive to stay with the process, especially after diagnostic assessment. The real incentives however will be the benefits that should start to accrue as the process takes hold within the organisation. It is the BANKSETA’s intention in discharging its sectoral research mandate to bring about investigation of the benefits actually being achieved in the banking sector.
2.2.4 Incentivisation. The BANKSETA should lobby all the relevant bodies to grant special dispensations to IIP sites and will explore ways of making discretionary grants available for the implementation of IIP in the sector.
Section 3: Strategy implementation
This section seeks to address the question of how the BANKSETA will implement the programme. This consideration aims to provide a framework in terms of which the programme: