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FACTORS INFLUENCING THE ADOPTION OF DIVERSITY MANAGEMENT:
CASE OF A MULTINATIONAL BANK IN INDONESIA
Wolter Boeky
E-mail : [email protected]
Lieli Suharti
Universitas Kristen Satya Wacana E-mail : [email protected]
Christantius Dwiatmadja Universitas Kristen Satya Wacana E-mail : [email protected]
Neil Semuel Rupidara Universitas Kristen Satya Wacana E-mail : [email protected]
ABSTRACT
This study aims to analyze how diversity management (DM) adopted and implemented through the policies and practices of HRM in a company. As for, the research questions of this research are as follows: (1) what are the motivates of the company to apply DM?
(2) what are external and internal factors as the driving forces of the company to apply DM?; (3) How does the company internalize DM into policies and practices of HRM ?.
This is a qualitative descriptive research from a single case study. The case of this study is an MNC bank operating in Indonesia who have applied DM. Indonesia context is interesting to be studied as this country has considerable diversity and multiracial, multi religion and multi-culture background. Data was obtained through in-depth interview with a number of key informants consisting of human resources department manager and several employees.
The study found that motives of the bank to adopt DM is, beside the increasing competition in the banking industry, also the global banking operations has to adapt with the environment where the bank is operating. Moreover, globalization is the reason why
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the bank adopts DM. Globalization affects the variety of laboring labors in the market, so that the management of various employees is needed to minimize conflicts and to be an advertising tool for the company to recruit talented minority in laboring market.
Competition in the banking industry forces the bank to create various innovation and creativity in providing the products and services that could satisfy the customers and clients' need. To create the right products for the customers and clients, the bank should understand the characteristics, needs, and obstacles of the customers and clients. By having employees with various backgrounds, there will be a bond between company and customers or clients, so that the customers and clients' needs and obstacles could be acknowledged and any solution could be found. This bond could also create another business opportunity for the bank.
Internally, the study found that the application of DM in the company requires the support of top management commitment which is represented in the formulation of the vision statement of company that accommodate DM issue. From the vision and mission, then it should translate into a company’s strategy which oriented to DM. Besides, organizational culture also need to be adjusted by entering values that may support the application of DM in the company.
On the external side, it was found that government regulations and policies in the banking industry at the macro level can also be a driving factor in the application of DM in a company or bank level. But more importantly, the development of diversity in customer and market served by a company, was found to act more as a driving factor for banks to implement DM voluntarily.
The application of DM in the bank studied was found operationally implemented in HRM policies and practices that starts from the application of Equal employment opportunities in the activities of recruitment and selection, training and employee development opportunities, compensation systems, performance appraisal system and career path opportunities.
Research studies on diversity management on MNC Bank are scarce. The finding of this study, however, can be useful and help to expand further research in this area.
Keywords: MNC, Germany, HRM, DM
INTRODUCTION
Demographic factors, such as globalization and economic, affect the diversity of the workforce (Christian, Porter, & Moffit, 2006) since the globalization provides convenience to the workforce to move from one country to another (Okoro & Washington, 2012). Likewise, the economic factor gives opportunities to the skilled immigrants to improve their quality of life by moving to the developed countries. Based on the Conference Board of Canada (2004), women and minority races will adorn the majority of new workforce so as to increase the
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diversity of the workforce, the increasing diversity of the workforce gives challenges to the organization in managing the diversity of their workforce, both of human resource as well as from the view of the organization (Ross-Gordon & Brooks, 2004).
Workforce diversity is a necessity and cannot be avoided, either by the government or organization. ASEAN economic community takes a role in opening opportunities for the invasion of foreign skilled workers to a country in Southeast Asia region thereby it may increase workforce diversity. Workforce diversity is not only a challenge for the organization, but also for the government. Many governments implement equal employment opportunity (EEO) and affirmative action programs (AAP), which aim to remove obstacles in the work and also provide opportunities for the employment of women and ethnic minorities (Jain, Sloane,
& Horwitz, 2003). However, according to Stainback, Robinson, & Tomaskovic-Devey (2005), the EEO laws only managed to raise the number of women and racial minorities in the workplace. For example, some research conducted by Kalev, Dobbin, and Kelly (2006) showed that in America, EEO was only able to help women and African-American in the lowest rank in the management level. Likewise, the study conducted by Agocs (2002) proved that in Canada only 19.1% of women and 3.2% of racial minorities grew at senior management level compared to their percentage by 46.4% of women and 10.3% of racial minorities. On the other hand, when the needs of women and racial minorities are in accordance with business objectives, the company will apply diversity management (DM) voluntarily (Dicken, 1999; Giscombe &
Mattis, 2002).
Many studies related to diversity focused on EEO, AAP, and representative bureaucracy (such as: Kellough 1990; Meir 1975; Rosenbloom, 1977), the impact of EEO and AAP (such as: Harrison, Kravitz, Mayer, Leslie, & LevArey, 2006; Jain & Lawler, 2004; Leck, 2002; Naff
& Kellough, 2003), the best practices of organizations in managing diversity (such as: Kalev et al., 2006; Kellough & Naff, 2004; Wentling and Palma-Rivas, 2000), and the support of top
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management was essential in managing diversity (Cox & Blake, 1991; Daas & Parker, 1996;
Morrison, 1992; Rynes & Rosen, 1995). The approach was clearly made to be legalistic and normative with an emphasis on the management mechanism that might help to promote the results for employee differences in the workplace. Several studies highlighted the importance of leaders’ commitment in diversity, such as Cox & Blake, 1991; Daas & Parker, 1996;
Morrison, 1992; Richard et al., 2002; Rynes & Rosen, 1995. But little has linked the diversity and the leaders’ commitment toward the diversity management.
DM supports the concept of EEO and APP, which refers to the efforts to ensure that all individuals have an equal opportunity of employment, regardless of race, color, religion, sex, age, disability, or national origin. However, DM is different from EEO and APP related to the managers, what they have done with work, their daily activities, as well as corporate programs which can be implemented in order to provide the best service for employees who come from various backgrounds (Pitts, 2009). Managing diversity, according to Thomas (1990), is to manage all the differences, whether based on race, ethnic, gender or other differences. This means to give confidence to all groups of employees that what they need is available for their advancement in the work, moving all the emphasis on the processes after recruitment.
DM means managing diversity contained in the workforce. Diversity management practices can be presented in the actions such as promote the perceptions of organizational justice and inclusion, reject discrimination (Kosseck & Pitchler, 2006), and appreciate the uniqueness and diversity of each employee (Lumadi 2008). Diversity practices such as the policies of diversity, recruitment, training and development, compensation, management accountability, community support and all considerations are important factors that can advance women and other minorities are included in DM practices area (Blanchard, 1989;
Konrad & Linnehan, 1995). For example, Holzer and Neumark (2000) reported that a number of AAP practices were used for the advancement of women and other minorities in
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employment. In line with this, French (2005) and Konrad and Linnehan (1995) found that HRM practices were associated with positive employment outcomes related to positive employment outcomes for women and minorities.
From an organizational level, if the diversity of the workforce is managed properly, it will provide benefits to the organization through the company positive climate for women and minorities. For example, racial minorities might ensure greater commitment for the organization (Hopkins, Hopkins, & Mallette, 2001) and decreased intention to leave the company if the management is committed to diversity (McKay, Avery, Tonidandel, Morris, Hernandez, & Hebl, 2007), improved the organization’s performance (Dwyer, Richard &
Chadwick, 2003; Barnett, Dwyer, and Chadwick, 2004; Robertson, 2007; Winston, 2010), improved the company's reputation (Ollapally & Bhatnagar, & Chadwick, 2003; Frink et. al., 2003, Richard et. al., 2004; Robertson, 2007; Winston, 2007, 2010), increased innovation and creativity (Jackson, Joshi, & Erhardt, 2003; Gebert, 2004), improved the image and services of the company, (Ely & Thomas, 2001) and improved the quality of work (Pitts, 2009). At the group and the Organization levels, the company might gain benefits from a wider range of views (Watson, Kumar, & Michaelsen, 1993), greater financial profit (Ng & Tung, 1998), more creative solutions (McLeod & Lobel, 1992), (Richard, 2000) as well as increased employees productive as a result of a good workforce diversity management.
Managing diversity in the workplace should be a concern of every organization.
According to Strachan (2012), there were three benefits of having diverse employees: (1) the organization could hire qualified employees from different cultural backgrounds and various community groups, (2) organizations with employees from different backgrounds would be better able to attract consumers from different cultural backgrounds especially in the current globalization era, (3) diverse employees were also rich in the variety of information, experience, perspective and creativity so as to form a reliable working team. Likewise in the
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research conducted by Cox & Blake (1991), the organization that was able to attract, retain, and motivate people with diverse cultural backgrounds could create a competitive advantage in the cost structure through the maintenance of human resources in high quality, not all organizations realized the power and benefits of having employees with diverse backgrounds and characteristics, even many organizations tended to overlook the power and advantages of diversity (Thomas, 2012). In fact, if diversity is not managed properly, it will lead to conflict and division in the organization (Adler, 2003; Williams & O'Reilly, 1998).
DIVERSITY MANAGEMENT ACROSS TO CULTURES: GERMANY – INDONESIA
As our case company is a German multinational bank operating in Indonesia, we consider it is necessary to provide a brief explanation about the characteristics of both nations and cultures.
Some characteristics of Germany as Home-Country
Administratively, Germany is a federal state with 13 states but governmentally, Germany is a parliament democracy state with daily administration held by a chancellor.
German society reflects the pluralist culture because in addition to having different ethnic both minority immigrants, such as Jewish, Italian, Polish, and Czech, and native minorities such as, Danish, Frisian, Sorbian and Kashubian ethnic. Jews are the third largest ethnic minority in Europe with a very rapid growth. There are also non-German citizens who live and work in Germany, such as Turkey, Greece, Croatia, the Netherlands, Serbia, Montenegro, Spain, Bosnia and Herzegovina, Austria, Portugal, Vietnam, Morocco, Poland, Macedonia, Lebanon, and France, including their derivatives from marriage. Beside rich of various ethnics, Germany also has a diversity in religion, Protestantism, Catholicism, Islam, Buddhism, and
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Hinduism. Even the number of atheist citizens is large enough, as many as 30 percent and this provides an explanation that the citizens not only have the right to embrace one religion but also the right to not profess any religion.
Germany also has a high gender equality by promoting disables’ right movement and socially tolerant towards homosexuals. Germany has also changed its attitude towards immigrants, but needs to be controlled and they must have certain qualifications.
Description of rights in the laws of Germany or Grundgesetz describes state obligations in respecting and protecting human dignity. Such rights guaranteeing freedom in developing the personality of each individual against the arbitrariness of the state and foreign citizens, such as freedom of religion, freedom of expression (including freedom of the press), protection of property, protection against forced labor, as well as full sovereignty over residency. Other right included in the category of individual rights in the Grundgesetz is the citizens' right that apply only to the Germany citizens, especially regarding political participation and freedom of executing the work. Besides the rights of freedom, there are similarity rights which no one should be disadvantaged or advantaged by sex, descent, race, language, homeland and origins, beliefs, religious or political beliefs. The equal right of men and women is also clearly stipulated. Grundgesetz also guarantees the right of every Germany citizen to be treated equally in terms of placement of public office.
Some Characteristics of Indonesia as Host-Country
Indonesia is a multicultural country which is reflected in the life of the society. Indonesia population consists of diverse tribes, such as ethnic Javanese, Batak, Minang, Sundanese, Bedouin, Bali, Banten, Banjar, Arab-Indonesia, etc. and based on census data of BPS in 2010 were as many as 1,340 tribes. Immigrant tribes, such as China, Arabic, and India, enrich the
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culture of Indonesia. Beside rich in culture, Indonesia also has various religions and beliefs, such as Islam, Catholicism, Protestantism, Hindu, Buddhist, and Confucian.
Government support for this diversity is reflected in the state ideology, Pancasila, the state constitution, 1945 Constitution, as well as labor laws, as a general rule regarding discrimination (Constitution Article I (3) of Law No. 39 year 1999, Article 27, 28D and I, of 1945 Constitution, Article 5.6, and 153 of Law No. 13 Year 2003), on women (Article 32, 76, 82 (1) and 83 of Law No. 13 Year 2003 and Presidential Instruction No. 9 Year 2000; about ethnic or race, such as Article 5 and 9 of Law No. 40 of 2008; of religion (Article 28E of 1945 Constitution), the disabled (Articles 5 and 9 of Law No. 9 of 1997; Article 4,5,6,7, and Article 8 Law No. 205 Year 1999; Articles 6,13, and 14 of Law No. 1997; Article 67 of Law No. 13 Year 2003).
Government support for this diversity is still a statement considering there are no cases of discrimination were revealed and became significant legal issues. Government still views the investment issue is greater than the issue of discrimination in the company. If discrimination issue is not handled properly, it will disrupt the performance of employees and the company's output.
Strategic Choice Theory
Leadership Behavior and Decision-Making
Leadership strategy theory is a theory that seeks to understand the impact of individuals or leadership team toward the company. The managers play a very important role in making strategic decisions. Complex decisions are heavily influenced by behavioral factors and limited by rationality and conflicting objectives. The unclear choices come from faith and the values of decision makers. This theory is used to see the relationship between the leadership and the decision to adopt DM.
284 Upper-Echelon Theory
Organization reflects its top leadership, in which their characters can be used to predict the outcome of the organizations (Hambrick & Mason, 1984). The characters include age, gender, race, educational background, values, thinking, style of leadership, and commitment.
Age
Age has a correlation with diversity (George and Yancey, 2004), for example, young managers appreciate diversity through their positive attitude because their socialization and acculturation in more tolerant time compared to the older generation (Sawyer, Strauss, and Yan, 2005; Schwartz, 1992). Because they grew up in an environment that increasingly appreciated the equation between people, so they could easily work together with the minorities.
Gender
Based on strategic-choice perspective, strategic decisions are influenced by the values and views of the decision makers. Women leaders tend to have their own experience against systematic discrimination or more aware of the harm that they found in their jobs because of their gender (Mighty, 1996). Women are more capable than men in conveying the ideas of APP (Beaton & Tougas, 2001; Harrison et al., 2006). One possible explanation of this is that a person's social group influences the attitude formation such as in a favorite group and self- interest (Kanter, 1977; Kravitz & Platania, 1993).
Race
Race identification of a leader affects several leadership thoughts including leadership attitudes, behavior and performance (Bartol, Evans, & Stith, 1978).
285 Educational background
The educational background of the managers gives an indication of the value of their personal and cognitive preferences (Hambrick and Mason, 1984). If the ability of education and thinking are intertwined, the more educated managers may create more creative solutions (Bantel and Jackson, 1989).
Values
Values are guidelines and determinants of social attitudes, ideology, and social behavior (Rokeach, 1973). Knowing the value of individuals enabled us to be able to predict how people will behave in a variety of experiments or real life situations.
Leadership style
Leadership aspect such as leadership style may influence the results of the organization.
Burns (1978) suggested that there were two styles of leadership, namely transformational and transactional. Transactional leadership is based on bureaucracy power and legitimacy strength within the company. Transactional leaders stressed on the placement of tasks, work standards, and compliance employees. These leaders rely on reward and punishment to influence the employees’ behavior. While transformational leadership (charismatic) is a process that motivates the followers by showing ideas and higher moral values. Charismatic leader can define and articulate a vision for the company and after that inspire the followers to carry it out.
Leaders’ Commitment
Commitment can be defined as a situation where an individual is bound by actions and through these actions he or she is sure to maintain the activity and his or her own involvement (Salancik, 1977a, p. 62). The concept of commitment has been used in a variety of ways, both of which focuses on a society (like Meyer & Allen, 1997) as well as a commitment to the policy
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decisions (such as Salancik, 1977a, b; Staw & Ross, 1978). The commitment of a leader on DM has a number of reasons, among others, as a substantive leader who has the ability to set policies and strategies which can affect the results of the organization (Pfeffer, 1981). In addition, as a symbol of the organization leader, the leader takes a personal stand in the need for change, acts as a role model for the compulsory behavior to change, and helps the forward movement of the organization work (Pfeffer, 1981).
METHODOLOGY
In order to understand the various aspects related to DM internalized in the policies and practices of HRM, the researchers used a qualitative research with descriptive type. The selection of this study was related to the consideration to understand the dynamics of the natural diversity and its management (whatever it is) in its internalization into the policies and practices of HRM in Foreign Banks. Also the studies related to DM in the context of Indonesia, especially in relation to HRM, are scarce or new so a strong supportive data is needed to be built through the data obtained from the field. Another reason is because the study DM issues at the enterprise level needs detailed information, so that a case study approach is more suitable than the quantitative study (Yin, 2003). This study described the actual picture of the fact of the processes of participatory, interpretation, and conclusion of the DM dynamics into policies and practices of HRM.
The Bank was chosen on the basis that:
- The Bank has set their commitments in the vision and mission as well as in the culture of the organization.
- The Bank is a multi-national company (MNC), which has been operating in more than 70 countries by the number of employees reached 100,000 people scattered across the globe.
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Interviews were conducted on HRD managers as the actors of company regulation and policies as well as some senior employees who have been working more than 20 years at the Bank. The first interview was conducted on HRD manager to verify the specific practices of the company that support the implementation of DM. The interviews were conducted for 3 times and each interview was conducted for 1.5 - 2 hours. The researchers also conducted additional interviews to two senior employees to determine their understanding on DM and how DM was internalized through their routine work.
The researchers also collected documents, especially documents concerning the Bank historical information, vision, mission, organizational culture, the reports of the bank's involvement in improving the welfare of the environment and society. Those information were obtained through the company's website as well as through company documents.
Primary data and secondary data were used to answer the following research questions:
1) What has motivated the Bank to apply DM?
2) What internal and external factors that prompted the Bank to apply DM?
3) How do the Bank internalize DM into the policies and practices of HRM?
RESULTS
2012 was an important year for the Bank because the Bank was in the transformation process. Transformation was done because the Bank more realized the hard challenges, such as competition, more stringent banking regulations and capital requirements, the higher public scrutiny, low interest rates, and the pressure on margins and the business volume that was strong enough. These challenges were used by the Bank as a momentum for change. It was delivered by NBA1:
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2012 was a tough time for us and at the same time an important year because we had to determine our next steps. Changes were happened in leadership, vision, mission, strategy, and organizational culture. 2012 was a transformation year and also a time of change for the Bank.
The changes started from the management side to perform the replacement of the leaders, set the new company’s goals which aspired to be a leading client-centered global bank, re- examined the business models and established the 2015+ strategy, as well as the organization culture. Organizational culture must be a value and belief of the Bank to achieve the goals.
In examining the business model, the Bank realized that products and services should be tailored to the needs of the clients and customers and find out the problems and obstacles faced by the customers. Moreover, because the Bank operations are global, then the employee mobility across departments and even countries should be able to overcome cultural and language and customs that exist in the destination department or the country. It was delivered by NBA1:
One problem we faced at the time was how to conceptualize the mobilization of the employees when their expertise is needed in other departments or in other countries.
Culture usually be the major problem so that the adaptation process is failed.
Strategy 2015+ is the Bank's strategy in facing the changing environment, such as more stringent banking regulations and capital requirements, the higher public scrutiny, low interest rates, and the pressure on margins and strong business volume. Through this strategy the Bank aimed to make itself the winner in a changing environment and became a leading client centered universal global bank. It was delivered by NBA1:
2015+ Strategy is a strategy developed by the new management after the first 100 days of their work. This strategy aims to steer the Bank to be a leading client centered
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universal global bank which operates in the midst of a changing environment. Strategy 2015+ mobilizes competencies and aims to build upon its own strength by developing four corporate divisions synergistically with the intent to meet customers' increasingly complex needs.
2015+ strategy reinforced the Bank's commitment as a universal global bank that can meet the increasingly complicated needs of the clients and customers. The approach to be done in order to deliver the needed products and solutions was to know the characteristics and habits of the customers and clients. The Bank hired employees from various cultures and backgrounds, it was one way to perform personal approach to the customers or clients.
Relationship that is built because of the similarity of culture and background is an effective way to identify the needs and existing problems or obstacles of the clients or customers.
Besides, this strategy also allowed the bank to take the opportunity provided by the long- term global trends, including demographic changes and technological advances. So that the Bank committed to a culture that align risk and reward, engage and develop talented individuals, support the work of groups and partnerships, as well as sensitive to the communities in which the Bank operates. The cultural changes were an important point for the Bank.
For the Bank, culture was the cornerstone of every business process. Culture guided every behavior, decision making and set the Bank services toward clients or customers and the communities in which the Bank operates. Bank’s values should organize business processes, behaviors, decisions and relationships with the Bank's clients, customers and communities.
In setting the Bank’s values and beliefs, Bank performed extensive employee consultation compared to the previous consultation. This consultation asked opinions, hopes, and ideas from 52,000 employees spread across the globe. The recommendations from the
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employees were discussed in senior management workshops and discussions and this process obtained Bank's core values, namely integrity, sustainable performance, client-centered, innovation, discipline, and partnerships. The complete values and beliefs of the Bank is attached.
In raising awareness of the Bank’s values and beliefs the to all employees, the Bank communicated through various channels, not only through the infrastructure and facilities they had, such as magazines and multimedia, but also through bilateral discussions and workshops.
Bank included employees in goal setting and performance evaluation of the employees so that that they felt to be involved in every process as the owners of the existing procedures. And no less important was that the senior managers held and underwent the highest standard of integrity as well as the role models. It was delivered by NBA1:
The Bank's core values were obtained through the ideas, expectations and opinions of the employees in employee consultation and were determined based on the discussions and workshops of the senior managers. Employee engagement was also performed in the process of goal setting and performance evaluation of the employees so that they
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feel as owners of these procedures, and may maintenance the procedures properly.
Senior managers provide examples employee behavior guide and run the highest standard of integrity.
The core values and beliefs of the Bank supported continuous performance by the development, maintenance, and investment of the best talent and management based on achievement. Target Achievement became the measure of employees’ success and was conducted transparently and fairly without looking at the background and closeness. The scoring system was conducted with 360 degrees system so that the assessment results were objective. It was delivered by NBA2:
Employees’ performance appraisal system is a system of 360 degrees so that the objectivity is accountable because our work is not only judged by the superiors but also by the colleagues and our staffs. Except for the staff level, the performance is directly assessed by the immediate supervisor.
The Company committed to foster an environment that supports workforce diversity through the value of partnership. Employees diverse was believed to generate better ideas and to reach balance decisions and achieve the Company general targets based on loyalty, trust, respect and cooperate each other and act as a partner responsible with all stakeholders, regulators and the public. It was delivered by NBA1 and NBA2:
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NBA1 NBA2
Workforce diversity as a
manifestation of itself in an open attitude and respect the existing differences in sex, disability, age, ethnicity and sexual orientation. Not only that, we also recognize and acknowledge lifestyle differences and culture, educational background, work methods and work experience
Diversity becomes the strength of the Bank due to the diversity provides innovative ideas and good decisions because it represents a lot of classes.
When we can cooperate in diverse teams we're appreciating them so that it may raise the confidence and good cooperation
Recruitment
Recruitment is performed through three (3) ways, namely through a headhunter that is specifically trusted for experience hire and through recruitment channel handled by HRD as well as through social media such as LinkedIn, the website, you tube, face book and google plus. The reason for using the headhunters is depend on the width of the networks owned by a head hunter. The use of social media, websites and headhunters shows that the Bank uses all access to get the best candidates with diverse backgrounds. Everyone can access the channel.
It was delivered by NBA1 in answering questions of recruitment channels used.
For the recruitment channel, we use website, social media and headhunter. Social media is also very effective in informing us about the advantages, such as vision and culture of the organization. It gives a very good impact. We use headhunter for experience hire because their networks and databases are very nice. Social media used are LinkedIn, Facebook, google plus, tweeter and YouTube. We had reached 627,000 followers. This is a very good momentum for socialization. Moreover, the young generation that is called Generation Y is very close to all things related to the Internet and social media.
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In recruitment, the company did not limit the background of the applicants. Applicants who were accepted were those that qualified and passed an interview and were placed according to their needs. The recruitment method was done through assessment, which combined psychological test and interview. Interviews were conducted three times, namely by the independent psychologists, HR manager, and the users. In the interview, knowledge of the diversity was explored to determine the ability to adapt in the diverse work environments to avoid conflicts when they were received and worked. The last test to be done by the prospective employees was a health test. It was delivered by NBA1 as follows:
Acceptance method was performed by psychological test and interview. Interviews were conducted in stages through independent psychologists, interviews with HR managers, interviews with users and if necessary interviews with CEOs. The diversity understanding was the topic in the interview.
To be able to attract the attention of job seekers and candidates from diverse backgrounds, the Bank promoted a work environment that values each employee on the basis of contributions made, not on the basis of the attribute it brought. The Bank also ensured career and facilities that attract those who have graduated as well as introduced an organizational culture that recognizes the diversity of the workforce without distinguishing them on the basis of gender, age, ethnicity, race, religion, disability, sexual orientation, work experience, and so forth. In accepting employees, we emphasized high standards by promoting integrity, discipline and sustainable performance. It was delivered by NBA1:
Many ways can be performed so that the community and job seekers can get to know the Bank, for example to inform as many as possible about the Bank to the public and job seekers through the website. Bank should not only deliver the financial statements and corporate governance but also introduce an organizational culture that values
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diversity of culture, race, gender, age, ethnicity, religion, educational background and so forth, with an expectation that job seekers who see our clean corporate governance and open organizational culture to the differences will be interested and the Bank will be the first choice in career development.
Training and Development
Development of the talented individuals was conducted through a fair assessment, career development, and giving advise that were supported of the organizational readiness in organizational capability, current and future talent and the intervention of the Bank. So that the organization can have the readiness in facing current and the future challenges that could affect the development of the individual, it is necessary to monitor the talent through the succession channel and the monitoring of senior leadership population. It was delivered by NBA1:
The concept of talented senior management through a matrix with four key factors cannot be run separately, namely, organizational readiness, individual development, management succession and senior appointment. In order to organizational readiness can affect the development of individual talent, the monitoring should be done by considering the population of senior leadership and talent channel. While to perform coordination between the management succession and senior appointment, it is necessary to consider the position monitoring by considering senior leadership position and its importance.
In addition, to maintain and sustain long-term performance, the Bank performed an acquisition strategy against gifted talents. By pursuing an acquisition strategy, the Bank actively identified the redeployment opportunities of the employees in accordance with the needs of the existing business units, designed internal career development and carried out a
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restructuring program by determining the critical size for this program could be accounted for.
It was delivered by NBA1:
To maintain long-term performance, the Bank run an acquisition strategy. This strategy was executed by identifying the employee redeployment opportunities that fit the needs of the division or business unit, performed a career development design and restructuration so this may become a process that can be accountable. This strategy could provide the opportunity for employees to improve their careers with the existing ability and experience to contribute in order to maintain and sustain the performance of the bank in long term.
An organizational culture that values diversity and encourages teamwork is very helpful this acquisition strategy since the employee transfer may occur across countries and different cultures, languages, and races and can lead to rejection and difficulties in a quick adaptation, as well as difficulties in teamwork. It was delivered by NBA1:
One obstacle in the employee transfer or the employee mobility is the differences in culture, language, race, and so forth that may inhibit the process of adaptation and teamwork. A rejection could even happen in the existing groups. Through organizational culture that values diversity and encourages teamwork, the obstacles and conflicts within the organization's strategy can be minimized.
In building the capability and ensure compatibility between the rules and expectations of the customers and clients, HR performed significant contributions to engage employees through every career path focused on the goal of building leadership capability and future talented leaders, encouraging environment that supports continuous performance, as well as promoting sustainable individual and professional development that allows employees to maximize their potentials as the attached figure
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The matrix sets up individual plans and the needs of the Bank to maintain long-term performance of the Bank by ensuring continuity and availability of leaders who possess the skills needed by the Bank by considering the various candidates who have the criteria and they are assessed fairly. The evaluation was conducted strictly, both to the existing leaders and other internal and external talented candidates.
Leaders Commitment
The top management and the supervisory board also understood that employee diversity was an asset as well as a business tool for companies. Therefore DM was strongly supported and this support could be seen in the vision, mission of the Company even in the vision and commitment and initiative strategy of the HR.
Bank Vision is wishing to become client-centered bank, become the basis for the Bank's to understand the clients’ characteristics so that the Bank products and services can suit the needs of the clients. To achieve its vision, in addition to applying the ethics and high standard integrity, the Bank used the attractive working environment that allowed best work-life balance, respected the diversity of the employees and supported their talent.
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The Bank vision and mission were also in line with supporting organizational culture that encouraged teamwork and created a work environment in mutual trust and respect, and can cooperate with one another. It was also delivered by NBA2:
The working environment at the Bank is very good, we can work together as a team without any suspicion and fear that our ideas are taken or insulted. We respect and value one another. The debates in every meeting and friendship are not offensive or taking our individual backgrounds.
To supervise the implementation and management of diversity in the Bank, the board of directors formed a Diversity Council and Remuneration Council to supervise the policies and legislation and remuneration to avoid discrimination. The members of the councils are the regional leaders and the councils are directly responsible to the board of directors.
The commitment of top management was also involved in diversity day program that was held once a year with different themes and was financed entirely by the Bank. This event was conducted to remind all employees about the diversity that exists in the bank, how to keep such diversity through a work environment that appreciates, respects, and understand the differences each other to form a work environment that supports the teamwork and partnership.
CONCLUSION
o The Bank’s motivation in implementing DM are competition in the banking industry, more stringent banking regulations and capital requirements, the higher public scrutiny, low interest rates, and the pressure on margins and the volume of business that is strong enough.
Moreover, because the Bank operations are global, the Bank should be able to appreciate the differences and cultures in which the Bank operates. War in snatching talented
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applicants also encouraged the Bank to apply DM in order to attract prospective talented employees from all backgrounds.
o The Bank performed DM internalization into all policies and practices of HRM from recruitment, training and development, up to the promotion
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