in agrarian societies, people worked for livelihood. times changed and came the industrial age. livelihood was not the only reason of working. as henry ford famously said “ why is it every time i ask for a pair of hands, they come with a brain attached? ” the people then understood that apart from livelihood, there is something else required. this something else was termed “ job satisfaction ”. we have moved on further and are now in the “ knowledge age ” and in this age, in my opinion, people work for “ empowerment ” more than anything else. i will touch upon other requirements of managing in knowledge age a bit later. the best development of people is through empowerment. people at all levels in the organization must feel empowered. for this, we need to cut layers of bureaucracy that we bis central bankers ’ speeches have created over the years and adopt an effective way to delegate. we have made some beginning in this direction in the rbi. performance management : this is the most important area of human resource management, the foundation of which is discrimination. unfortunately, current systems are unable to discriminate and differentiate between performers and non - performers. in fact, it is impossible to identify who are the performers and who are the non - performers. i don ’ t know if any one of you has even attempted to identify who are, say, the bottom 25 % people in your organization. in any organization typically there would be some 10 – 15 % of people who would be the high performers. hr managers often focus on this segment and try to cater to their needs first. instead, i feel that focus should be on the remaining 85 % as any improvement in their performance would have a significant impact on the organization ’ s performance. with all the efforts a student who always scores above 90 % marks in his class, will benefit by only a few percentage. the one who scores only 45 %, however, has the potential of doubling his marks. the results of not having a proper performance management system are disastrous. we are all having to deal with the problem of people who are “ promotable ” but not “ postable ” and people who are “ postable ” but not getting promoted. this is because we have failed to discriminate between performers and non - performers. hr systems may have failed to appreciate performers. in fact, we have not even tried to define what performance is in a given job. despite this, what is the kind of time we are spending on performance management? what is

what is expected of a leader? a leader is expected to do three things : ( i ) plan ( the tasks ) ( ii ) inspire ( people ) inspire for aspiring inspire for perspiring and ; ( iii ) deliver ( on results ). a leader is no leader if he / she cannot deliver. systems / processes : the hallmark of any effective hr system / process is that it should be objective and transparent. these traits are essential for the manpower to repose trust in the organization ’ s systems / processes. no hr function can be effective if it does not enjoy the trust and confidence of its constituents. two key stakeholders in the hr management process are board / senior management and unions. how much time do board members spend on hr related issues? perhaps, not enough. structurally, it is important that board / senior management is actively involved in hr matters involving all its manifestations. organized employee unions are an important part of the democratic process and form an effective channel for communicating with employees down the line. it is important to involve them in the hr process without allowing them to have an overbearing influence. communication : communication with employees is a vital part of the hr process as it helps enhance transparency in hr practices, thereby imparting credibility to them. when dealing with human beings, it is important to be objective, transparent and non - discriminatory and this must be effectively communicated. the employee must say that the management has all the above qualities. the board must spend time on devising ways and means for this communication – lay down appropriate structures for the purpose. all forms of modern communication channels including intranet, corporate e mails, etc. can be adopted to reach out to employees. however, despite these developments, the traditional channel of communicating through unions continues to be relevant as employees attribute greater credibility and reliability to messages received through their unions. the banks have a clear cut advantage in this respect – they already have a participative process. representatives of the employees sit on the board itself and hence, it requires better practice of participative management in the real sense of the term. ( d ) managing people separation / exit : except maybe a last few years, so far most of the people leaving us were due to retirements. things will change, unless we are doing all the other things that i spoke out earlier, properly, people will also leave us for other opportunities – and believe me, there are going to be plenty of them – not only from competitor