Impacts of installation of smart automated teller machines (ATMs) on frontline banking staff in India: A change management perspective

Abstract

The banking sector in India has embarked upon computerization and automation on a vast scale in the last decade. The most notable one is the introduction and progressive application of information and communication technology (ICT) related automation in the form of multifunctional Automatic Teller Machines (ATMs) installed in the retail banking branches. Banks gradually reduced the number of frontline staff because there is less need to interact face-to-face with the customers due to automation. Bank management applied organisation development (OD) interventions such as job redesign and training to handle the consequences of these changes.

The literature review revealed numerous studies on the impact of ICT on the banking sector. However, limited empirical literature exists regarding the impact of the introduction of SAM (semi-automated machines) on frontline banking staff in India. This research study analysed the impact of the introduction of ATMs in bank branches on the frontline banking staff in a public sector bank (G) and a private sector bank (P) in India from a change management (CM) perspective. The age-old question of whether machines can replace human resources is also explored. A qualitative research approach was applied, with an instrumental case-study method in which a semi-structured interview technique was used to collect data from six respondents from banks G and P.

The findings revealed that the installation of ATMs resulted in job enlargement for the frontline staff with horizontal job loading. While the frontline staff offered meagre resistance to this technological change, they had concerns about the top management's lack of a proactive approach towards implementing effective HRM policies for managing this change effectively. The fear that the introduction of smart ATMs would altogether dispense with the need for frontline staff is unfounded as the value of ‘human touch’ in retail banking was recognized,especially in rural and semi-urban branches. The findings also indicated an increased level of stress, out-of-sync recruitment policies, and vague training programmes for frontline staff, indicating a lack of participative decision-making. The recommendations suggest various ways to manage this technological change by designing and implementing focused HRM policies with effective OD interventions mechanisms.