There has been an immense discussion of the concept of employee engagement in the contemporary business environment. It has emerged as a famous corporate concept of the current time. Moreover, organizations today are prioritizing this concept to enhance their performance and to build a competitive advantage. This study was conducted to determine the role of employee engagement practices in the banking sector of Sri-Lanka. The main purpose of this study was to explore various studies on a similar field by diverse scholars. The main elements that were discussed in this study entailed the meaning of employee engagement and its importance in contemporary organizations. Furthermore, it discussed the key drivers and types of employee engagement to comprehend the knowledge about the concept. Additionally, the researcher was focused on discussing the concept of employee engagement in the banking sector both in private and public sector banks to study the differences in both sectors in terms of engaged employees. Further, the researcher discussed the Sri-Lanka banking sector employee engagement practices and how effectively the public and private banks were managed to adopt these practices. This study found that banks and financial sectors in Sri-Lanka faced a higher level of employee turnover ratio and a low level of employee engagement when compared with other sectors in the nation.
Meaning of Employee Engagement
Types of Employee Engagement
Aspects of impacting Employee Engagement
Ten Cs of Employee Engagement
Importance of Employee Engagement
The relevance of Employee Engagement in Contemporary Business Environment
Function of Employee Engagement in the Banks.
Employee Engagement Practices used in Sri-Lankan Banks.
The literature review refers to the assessment of present or available literature on a particular topic or subject. It is the most vital element of research that generates the existing information into an appropriate summary (Snyder, 2019, pp. 333-339). Various studies have been directed on employee engagement in the banking sector. This literature review reflects the meaning of employee engagement, its importance, and its significance in modern organizations. Furthermore, it discusses the essential function of employee engagement in the banks. Additionally, it entails the discussion about employee engagement practices followed in Sri-Lankan banks. Besides these, this literature review helps in evaluating different scholar's studies on a similar concept or area.
As per Hanif, Naqvi & Hussain (2015, pp. 204-215), in contemporary times, the corporate scenario is changing concerning the diversity of workers, and international aspects. Every business organization across the world is desirous to make the finest use of its human capital to attain a competitive edge in the marketplace. It is a fact that when workers are engaged in their work, they possess a robust association with their peers, and the environment of business becomes superior and relaxing. Engaged workers are not only happy in their job but also convert their satisfaction into greater efficiency and productivity of the business. Allen (2014, pp. 1-4) stated that employee engagement refers to sensitive pledge workers' feelings towards their company and the movements they take to confirm the success of the company. It is true to say that engaged workers work with enthusiasm and feel a responsive connection to their company. They drive novelty and move the company onward. These employees are featured as being creative, dedicated, loyal, and offer results. As per the study by Kumar (2019, pp. 1-12), the concept of employee engagement has appeared as a prevalent corporate concept in contemporary times mainly in the service industry. Sometimes, this concept is being considered to be identical to job satisfaction, corporate commitment, citizenship behaviour, and job involvement. His study suggested that employee engagement refers to as the procedure by which a company enhances the pledge and extension of its workers to the attainment of greater results. It is the emotional state in which workers feel a conferred interest in the company’s success and achieve a great standard that may surpass the definite necessities of the job.
There are mainly three types of employee engagement that is present in the organization. These are named as engaged employees; not engaged, and actively disengaged.
Engaged employees: These employees are considered as the base of business development. Moreover, they carry forward the company in a positive direction and play an essential role in attaining corporate goals and objectives.
Not engaged: These employees have no concern for attaining the company’s goals, development, and objectives. However, they only are concerned about their work. Besides that, they do not have passion and energy in their work; and they have a little supportive association with their peers within the organization. They contribute little to the success and expansion of the business.
Actively disengaged individuals: These employees are not passionate to perform their work in an accurate and timely manner. Furthermore, their engagement or involvement in the activities of the company is insignificant in its success and development. Additionally, these employees are unhappy at work and they carry forward the company in an undesirable direction (Saks & Gruman, 2014, pp.155-182).
All the types of organizations have certain common aspects that lead to employee engagement and these factors develop a sense of appreciation and involvement among the workers. The essential factors are illustrated below.
There are ten Cs of this concept namely connect, career, credibility, clarity, convey, collaborate, control, confidence, contribute and congratulate.
Connect – It means that employee engagement is positively associated with the manager’s conduct with the workers. Thus, workers must suitable connect with their supervisors and employers.
Clarity – It is true that the success of a company relies on clear goals and aims that must be communicated to employees by their managers.
Career - The management in a company should offer the prospects for growth and expansion of its workers. To do so, the company must conduct suitable training and development programs.
Congratulate – It means that employees must be rewarded with the lucrative benefits for their outstanding performance in the company. Moreover, they should also receive feedback in the areas they are weak and want to improve themselves.
Convey – It means that management must have the ability to convey to workers about the expectations of business from them. Besides that, effective leaders must review their performance frequently.
Collaborate – It is true that employees have to work in a team in the workplace to attain a project's objectives. Therefore, there must be a sense of trust and collaboration among the team members.
Control – This role is to be played by leaders and they are responsible for reviewing the organizational activities against the anticipated outcomes.
Credibility – It means that leaders must put efforts to preserve the brand image of the company and demonstrate higher moral standards.
Confidence – Effective leaders must have the ability to build confidence in the company by establishing higher moral and standard performance.
Contribute – It means that workers are highly motivated when they contribute to effectively attaining corporate goals. However, leaders must assist workers in feeling how they are contributing to the company's victory (Pandita & Bedarkar, 2015, pp. 29-40).
As per Smith & Macko (2014), the significance of employee engagement lies in a wide range of benefits it brings to the company. Firstly, it is responsible for reducing turnover meaning that companies with engaged employees have greater retention rates. Disengaged workers are indeed less likely to build robust relationships with the company, converting to less determination and more wish to leave when a superior offer reaches. Furthermore, Cesário & Chambel (2017, pp. 152-158) suggested that engaged employees feel more satisfied with their careers and are usually happier people than not engaged ones. The benefits of employee engagement practice at the workplace must be for both parties. For the company, the benefit is that it is surrounded by happy workers who are coming every day to the job and doing it cheerfully. Additionally, it is a fact that when employees feel happy in their private and professional life, it would positively impact the performance of the company. The companies with highly engaged workers attain two times greater income than organizations with the worst engagement levels. Zameer et al. (2018, pp. 233-248) stated that since companies rely on growing and preserving customers, therefore the company must make a strategy for this. Employee engagement leads to bringing higher customer satisfaction that is essential to a business to retain customers in the long run. Creativeness and innovation are the aspects that can take forward a company ahead of competitors. In this respect, engaged employees can help the organization with their creative and innovative notions out of their passion to work in the company. They carry a sense of ownership in the company and hence they incline to continuously think of a creative technique to improve the ways of doing business.
In the contemporary business environment, employee engagement has been at the forefront of numerous organizations as it offers wonderful benefits to them and enables them to thrive in such a competitive market. As per Swarnalatha & Prasanna (2013, pp.139), it is the key business driver for the success of the organization. A greater level of engagement in domestic and international companies endorses retention of the workforce, nurture client loyalty, and enhance corporate performance and the value of shareholders. The contemporary organizations are involving the HR’s role in setting agenda for the employee involvement or engagement. It is because today there has been increased demand for work-life balance and the altering association between management and employees, which are driving the necessity of human resources.
Today’s competitive business setting calls for novel and creative methods of handing human capital, enhance efficiency, and usually generate value through individuals. According to Kumar & Pansari (2016, pp. 497-514), gaining competitive advantage has become an important aspect for all contemporary organizations due to the presence of numerous competitors in the market. There is a strong link between competitive advantage and employee engagement. Employee engagement indeed drives alignment, employee satisfaction, productivity, organization commitment, and talent retention. These aspects of employee engagement lead to high-level customer engagement including customer loyalty, retention, satisfaction, and client service. Furthermore, all these aspects lead to creating a strong competitive advantage in the form of higher shareholder value, profitability, market share, and sales growth.
According to Nwinyokpugi & Modey (2019), the non-engagement of workers in the decision process of the banking sector results in job discontent that will further lead to less efficiency, lost man-hours. Their study suggested that the non-engagement of workers would adversely impact the prosperities of the banking sector and hence the gross domestic product of the country at large. Moreover, a shortage of workers' representation within banking is unable to offer opportunities to workers to develop a channel for employees' voices to be heard on important decisions in the banks. It is also a concern when workers are not suitably empowered to take particular choices within their level of power and also they are not seen as associates in any scheme of banking operations. Employee engagement practices are an urgent need for the banking sector.
Therefore, banks must have to improve their culture of association with workers to attain the anticipated outcomes of efficiency. However, the study by Mokaya & Kipyegon (2014, pp. 187-200), assessed the factors of employee engagement in Kenya's banking sector. Furthermore, their study suggested that the bank managers must focus aggressively on the programs and actions that endorse employee involvement and having a positive link with the performance. Their study found that the Co-operative Bank in Kenya has a high level of employee engagement that was significantly impacted by personal expansion & growth, workplace reformation & compensation package, and performance management. Furthermore, their study also suggested to managers of banks in Kenya that they must allow two-way communication, provide frequent feedback to workers, offer suitable training for worker’s betterment, and more.
The study by Banhwa, Chipunza & Chamisa (2014, pp. 53) suggested that different retail bank managers in South Africa used diverse approaches in improving employee engagement. Further, they were of the view that engaged workers are essential for building a competitive advantage for the company. Additionally, their study demonstrated that the strategies that diverse retail banks used for employee engagement were job satisfaction, cooperation, health & safety, work-life balance, diversity & inclusion, equal treatment, worker empowerment, and more. Apart from this, it concluded that higher employee engagement in banks enables workers to display diverse corporate citizenship behaviours. According to Singhal, Bala & Sarawgi (2017, pp. 83-103), the bank's worker’s involvement strategies start from the recruitment stage by choosing suitable individuals, organizing robust training programs, offering demanding expansion programs that provide soft and technical skills training, leadership development, and more. Their study suggested that banks must comprehend the significance of workers and engage them to the highest promising level by applying appropriate actions.
Additionally, it found that employee motivation is one of the factors responsible for higher customer satisfaction in the banking sector. It stated that employee engagement is essential for job satisfaction, and employee faithfulness and retaining in the banks. The study by Khurana & Singh (2015, pp. 13232-13247) suggested that the employee performance appraisals, training, and career development, reward system are the factors responsible for employee engagement. Furthermore, their study was conducted using private and public banking sectors. It found that there are numerous differences in the employee engagement practices of both these sectors. It was due to the lack of trust and a friendly environment, and lack of resources to perform activities in the banks of the public sector. Furthermore, it concluded that there was a 66% correlation between business outcomes and employee engagement in private sector banks. On the other hand, there was a 50 % correlation in the case of public sector banks between the variables.
It is true to say that banks create a substantial portion of businesses in Sri-Lanka and hence banks must constantly grow and progress for the future endeavour in the nation. However, this can be done by keep ensuring that banks' workers are performing in a manner that fulfils the expectation of the company. Additionally, banks must have to keep their workers engaged in the activities so that all the expectations of the bank could be fulfilled. The study by Kumari, Jayasinghe & Sampath (2020) suggested that the banking sector in Sri-Lanka must be thoughtful about the socio-demographic factors while creating recruitment policies. Due to this, the employers in both private and public sector banks would be capable to produce a satisfactory environment for workers and corporate aims will be attained effectively by using competencies of motivated workers efficiently. Tharangani (2018, pp. 235-248) suggested that the initiatives of talent management that entailed managing talent, retention, and attraction have positively impacted the effectiveness and engagement of brilliant banking employees of Sri-Lanka.
Furthermore, his study found that skilled employees feel positive as their banks are investing time and energy in selection, training & expansion, performance management, offering lucrative compensation, work-life balance and more that might be reacted with enhanced encouragement, sense of engagement at the workplace and leads to enhance their performance. Ahamed (2016) showed job satisfaction of workers in public and private Sri-Lankan banks as it is one of the drivers of employee engagement. Furthermore, it stated that job satisfaction is a vital component for the workers to attain corporate goals. Likewise, the study by Weerasinghe, Senavirathna & Dedunu (2017, pp.2326-0297) also conducted the study on job satisfaction of workers in Sri-Lankan banks and it found that both the private and public sector workers’ job satisfaction was at a substantial level and workers in government banks have revealed higher level of job satisfaction than private employees. Furthermore, it concluded that the salary of workers is the utmost descriptive variable of job satisfaction of banking workers in Sri Lanka. Sivalogathasan & Ariyadasa (2016, pp. 17-21) demonstrated that there is a positive association between service delivery and work-life balance among the private sector bankers in Sri-Lanka.
Their study further indicated that training and development is the most beneficial factor in having a positive correlation with employee engagement. It is a fact that for Sri-Lankan banks, employee engagement refers to the energetic involvement of workers in all the events. Their engagement must be with the bank itself, their job, and the larger society. The banks that were interviewed in Sri-Lanka perceived how essential the concept of employee engagement is for workplace success. Giragama & Sooriyabandara (2017, pp. 28-41) stated that the issue of high staff turnover in the private banks of Sri-Lanka as compared with trade norms.
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