Which practical models could be implemented for human resource management to retain senior managers in the Lao financial services industry?

Abstract

In today’s competitive business environment, to sustain a competitive advantage in any form of business operation, it is not only dependant on information technology; the effective management of human resources is also a critical element. This research focuses on human resource management (HRM) in the banking industry in Laos from the perception of the relationship between human resource management and organisational performance. The purpose of this study is to collect data to identify and develop a practical model for HRM processes for addressing HRM problems in Laos, specifically with an emphasis on the management level of the country’s banking and finance system. It also aims to identify better methods in selection, recruitment, retention, training and developing people with a high degree of commitment, adaptability and skills. The literature review for this research begins by considering definitions of HRM, key concepts of HRM, contemporary issues in HRM, human resource (HR) functions, the interdependency of HRM processes with HR functions and a HRM model to recruit and retain key staff.

Both a quantitative and qualitative approach were followed with the objective of gathering data from participants in three banks, Bank of Lao Foreign Trade, Lao Viet Bank and ANZ Bank in Laos in the field of HRM. The interviews and questionnaire focus on addressing the main research question and aim of this study. Three interviews were conducted with the HR managers of these banks. A total of 66 copies of the questionnaire were distributed in paper copy format for voluntary participation by employees of these banks. A high percentage of responses was received and the data collected from the survey about participants’ views of HRM was collated for analysis.

After analysing the results of this study, it can be concluded that although employees strongly believe that HRM departments play an important role in their bank’s performance, their HRM departments do not take part in business level strategy and decision making. It may take some time for these banks to become directly involved in business strategy based on the main responsibilities of HRM departments, because these currently focus on traditional administration, such as payrolls, recruitment and selection of people to work, rather than being a partner in the business operations in these banks. Additionally, the study results play a critical role in contributing to HRM in Laos by developing a proposed HRM model to identify better methods for the banks in selection, recruitment and placement that would also lead to employee retention, training and developing of people.