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In GCC, young people can be considered as one of the most active and powerful social actors, pointing to their developed needs for comfortable working conditions, recognition, and high quality of life. Young people expect employers to meet their income, and career needs. Compared with other generational groups, youth work behavior is characterized by increased mobility. Thus, in the Gulf Cooperation Council (GCC), the proportion of young people who have changed jobs can reach high rates, and this trend is widespread. For example, young Dubaiers, like young Arabs, change jobs much more often than mature workers. The high mobility of young people actualizes the issue of adapting approaches to human resource management to stabilize staff and regulate mobility for effective work.
RAKBANK is one of the largest banks operating in the UAE and more than half of the bank is owned by the government. It is in a position, where there is a lack of adherence of the bank to its core strategy of striving for innovativeness (Who we are, 2020). For the year 2017, the bank’s net profits were AED 810.5 million, which is a substantial increase compared to the previous annum (Report of consolidated financial statements for the year ended 31 December 2017, 2018). In addition, the operating income is equal to AED 3.8 billion, whereas operating costs are AED 77.8 million (Report of consolidated financial statements for the year ended 31 December 2017, 2018). The products are insurances, loans, savings, and deposits, and the bank’s strategic goal is to have an inflow of competitive specialists to increase its market share (RAKBANK Profile, 2020). There are some competitors, such as Abu Dhabi Commercial Bank, Arab Bank plc, Bank of Baroda, and thus level of rivalry is high. The market share of RAKBANK is equivalent to other competitors because a significant portion of these institutions is owned by the local government, which means that monopolization is artificially prevented. In RAKBANK, high inter-and intra-banking mobility is inherent primarily in large-scale banking professions, such as sales, service, and customer support. Turnover rates are associated with high competition in the banking sector because front office employees can easily change jobs if they are offered more wages or a slightly higher position. RAKBANK is currently focused on enhancing its back-office capabilities (Bank profile, 2020). At the same time, the orientation of the personnel policy of RAKBANK is the qualification and role of personnel in the implementation of strategic tasks. The bank’s customer interaction is based on B2C, where regular citizens can purchase insurance or get loans.
In corporate environments, it is often appreciated for the strategic role of staff and the value of forming a highly qualified team. Common features of RAKBANK practices include benchmarks for the active involvement of highly qualified young professionals, for the socialization of which adaptation programs, mentoring and many training formats are used. It is stated that an organization needs to have high-quality employees to implement a strategy (Kaplan and Norton, 2005). In addition, the bank’s net interest income is a source of its net profit (Augustine, 2020). RAKBANK is focused on the value of personnel have innovative approaches to the system of compensation and benefits, the organization of internal communications, distance learning programs, talent pool, and career models are being developed.
In this regard, an assessment of the intentions of young workers to leave or remain in the organization depending on their satisfaction with the career and career management practices is relevant for the RAKBANK. The purpose and objective of the case study is to identify the effect of career satisfaction and career management practices on young employees’ intention to leave or stay in the bank. The objectives of the RAKBANK are to establish the role of key factors in this process, such as satisfaction with career and career practices, and socio-demographic and socio-professional factors. In addition, it is important to determine and verify the change in the nature of their influence when the factor of satisfaction with remuneration is included in the regression and analyse the role of career satisfaction as a mediator of the relationship between career practices and the intention to leave or stay.
The RAKBANK creates working conditions for employees, which are generally typical of other banks, and uses a wide range of methods. The bank’s divisions have the rules for career development of employees. According to the conditions, new employees can only be hired as specialists, and the remaining vacancies are filled with internal resources of the personnel reserve. It is stated that an organisation’s resources and performance can be better understood including uncertainty of environment into the analysis (O’Shannassy, 2008). In order to move to a new or higher position, an employee needs to consistently fulfil planned targets for three months and successfully pass a comprehensive assessment. General approaches and principles of career planning include a profile for each position with a list of requirements for knowledge, skills. It also involves tools and a rating scale for each post level, conducting a quarterly assessment, an approved success score with indicated achievements in each position to move to another position, as well as an approved training program for each level of position.
The RAKBANK’s traditional approach to a career as a phenomenon of exclusively professional activity, which boils down to a sequence of occupied steps in the production, property or social environment, does not correspond to the current state of the external environment and the labour market. In RAKBANK, new ideas about the career focus on the conscious position and behaviour of a person in professional activities, based on his work experience. In the framework of the modern approach to a career, the meaning of work and the subjective perception of success are taken into account. It is stated that framework and analytical tools are critical for strategy execution (Kim and Mauborgne, 2004). For RAKBANK, criteria for a successful career are not only based on financial performance, they also include an emotional assessment of a career, career or professional identity, and adaptability. Satisfaction with a career is presented as the employee’s attitude to professional growth and a feeling of conformity of professional activity to his inner world, interests and expectations of work. It is stated that one of the key strategic issues of large organisations is talent management, which is a part of strategic management (Meyer and Xin, 2017). Therefore, the bank retainment issue is escalated by the current non-adherence to its strategic strive for innovativeness.
The strengths of RAKBANK within the scope of the mentioned issue might be defined as follows. It was claimed that RAKBANK is among the crucial actors in the bank industry in the UAE. Keeping this fact in mind, it is reasonable to assume that new young employees who have a necessary qualification tend to be lured by the opportunity to work in such a top and respectful establishment. Hence, RAKBANK always has the possibility to enrich its human resources and hire notable professionals. In this regard, another obvious advantage that can lure a plethora of youth is that the bank has significantly increased its profits and provides a wide range of services. The latter results in the fact that noticeable graduates with diverse specializations can try to become a team member of RAKBANK.
Then, it should be noticed that the government owns half of the shares of the bank. This feature might be considered as a disadvantage as it means that the government takes part in making crucial strategic decisions. It is not always beneficial for RAKBANK in any framework, starting from financial policy and ending with the HR one. However, the mentioned peculiarity is also a characteristic of the rivals of the bank. Thus, a monopoly in the market is prevented, which allows assuming that such a form of ownership is quite favourable to the exact extent.
Another strength of RAKBANK is that it pays attention to the active involvement of qualified youth. It develops vital programs for their socialization, which might contribute to their loyalty and dedication, as well as to an unwilling and reduced turnover. Different training formats help newcomers to adapt to a new working environment and to demonstrate a significant performance. This performance is the critical element of the success of an organisation in any industry and at any time.
Focusing on the importance of staff is an advantage of the bank too. Innovations related to the frame of compensation and benefits lead to employees’ understanding that they are being taken care of and that they are involved in an appropriate and reliable establishment. Then, the continuous process of development of distance learning, talent pool, and career models contributes to the prosperity of RAKBANK in the long run.
Nevertheless, a number of weaknesses characteristic to RAKBANK were also identified. Regarding the working environment, the bank does not provide anything unusual if to compare with the other establishments. It creates the requirement that new personnel is to have high qualification, and if new vacancies are not filled by newcomers, then, the internal staff fills this gap. It might be supposed that it would be more productive to develop an enrolment system that will not allow occurring of these gaps.
Furthermore, it seems that the bank’s approach to a career does not adhere to present ideas of labour market regarding this issue. The RAKBANK considers a person’s professionalism and work experience as primary indicators of the career. However, modern concepts also make an accent on the subjective comprehension of success and on the essence of work as employees’ job satisfaction is a crucial element to prevent turnover. Thus, this undesirable turnover is quite possible to take place due to the fact that the bank does not follow modern tendencies in the framework of understanding the career issue.
- On the basis of the information provided, what kind of changes to RAKBANK’s core strategy of increasing it competence can retain more young employees in order to remain innovative and dynamic?
- What kind of strategic management theory can be integrated in order to increase RAKBANK’s appeal for young and highly competent professionals?
Teaching Notes
The main teaching point is that strategic career management is an integral part of the RAKBANK system and is often described through appropriate practices. The strategic system approach considers the bathhouse as an integrated bundle, a bunch of complementary and mutually reinforcing practices. This is the position according to which the holistic, internally coordinated system of practices of RAKBANK has a synergistic effect on the results of the organisation. Career management is defined as a set of methods and practices that ensure the management of professional experience of personnel in the organisation, the implementation of its strategy. Innovation strategy is critical for companies in order to remain competitive (Pisano, 2015). It can become a major part of innovation strategy of the bank.
In the case study, career management is interpreted as a system of complementary and mutually reinforcing practices, operationalized through a set of RAKBANK practices using the Strategic Management Process Framework (SMPF) (Barney and Hesterly, 2010) model. The list of practices highlighted on the basis of classification includes special tasks, projects that stimulate training, on-the-job training, and participation in the work of project teams. In addition, it is important to have formalized networking schemes — communication with colleagues, formalized career development plans, development centres, succession and replacement planning, planned rotations, talent pool and talent development programs. You can also include international appointments, coaching, mentoring, and distance learning.
The answer to the first question is that RAKBANK should adhere to the Strategic Management Process Framework (SMPF), as a result of which the bank welcomes voluntary turnover. The given concept emphasizes the importance of adherence to the original mission and purpose, where the analysis is made based on these core ideas (Barney and Hesterly, 2010). This means leaving the company on the personal initiative of the employee, and the intention to leave is the conscious, premeditated orientation of the employee to leave the organisation. The main turnover of labour in each industry can be considered due to the voluntary departure of employees from organisations.
The case has a phased structure, where the first part examines the traditional and modern approach to a career at RAKBANK. Sales related job postings can be observed on the official RAKBANK website (Welcome to RAKBANK, 2020). In addition, key elements of RAKBANK determine the essence and content of the concepts of career management and voluntary turnover, and approaches to retaining personnel are analysed. A detailed review of RAKBANK of voluntary staff turnover and its causes with an emphasis on career satisfaction, as well as factors, including career practices, is important for the bank. The RAKBANK strategy focuses its role in exacerbating the problem of matching career practices and youth expectations. RAKBANK requires elements through which the design of applied research is demonstrated, such as a theoretical model, a method of collecting information, sampling, dependent and independent variables, and a method of processing data. It is also stated that global talent management strategies can be developed by adhering to the main objectives and strategic goals (Collings, Mellahi, and Cascio, 2018). The results of a regression analysis of the factors affecting the intention to leave or stay in the bank are identified and the results obtained are discussed in comparison with the data of other voluntary turnover and career projects.
A significant contribution to the formation of modern views on voluntary staff turnover and career management was made by the concept of organisational equilibrium or the balance of employee and organisation contributions and the concept of alternatives. It is important to note that there is no significant work done in the banking sector of UAE (Bose, 2018). In their framework, attention is drawn to the need and value of the joint efforts of the employee and the organisation for career development. In the following recommendations, for understanding the Strategic Management Process Framework, indicators such as organisational culture, team cohesion, incentive system, gender and demographic composition can be distinguished. General trends in gender turnover are job satisfaction as a key factor in leaving or extending employment, among other aspects of satisfaction, including career. Good enough turnover is predicted by labour plans and intentions, if the efforts to find a new job are not great.
An important place in the explanatory models of leaving or prolonging employment is occupied by the characteristics of the interaction between the employee and the environment, such as the influence of the mentor and the unity of the working group. It also includes autonomy, career support and career opportunities, and factors of labour stress and exhaustion. In the format of the Strategic Management Process Framework, dissatisfaction with the work and its individual aspects, including career, will trigger employee opportunistic behaviour, such as lateness, absenteeism and dismissal at will.
The case may offer several key reasons for voluntary turnovers, such as the effect of individual differences, attitudes toward work stress, and changes in work. It is stated that dynamic capabilities are challenging to measure, but they can positively affect competitiveness (Mohamud and Sarpong, 2016). In addition, the role of the organisational context is important with an emphasis on the nature of interpersonal relationships, retention factors, commitment and career satisfaction, and dynamic fluidity modelling.
Observing the individual differences in student responses, it is important that they conclude that there is a moderately low correlation of age and intention to leave. The experience and duration of work in the company should be discussed in the consideration of the case. It is important to direct students’ thoughts through the Strategic Management Process Framework, where education and the marital status of employees may also be included in potential turnover factors. In an organisational context, factors such as mentoring and leadership, being a small group or network, reduce the likelihood of workers leaving the organisation. Supervisor support positively affects employee retention in the company. Special attention should be paid to the removal of the factors of workers’ consolidation in the enterprise. A positive perception of bank methods contributes to the formation of ideas about organisational support, which may be negatively associated with leaving the company.
Students can come to the conclusion that the study of turnover and attitude towards a career is carried out as part of an analysis of the impact of organisational changes on the adaptation and condition of an employee in an increasingly complex dynamic environment. It is important to supplement the analysis with factors such as organisational policy, situational constraints and role overload, which reduce job satisfaction and increase turnover (Campbell, Edgar, and Stonehouse, 2011). Relevance of career plans to staff expectations, company policies, and other contextual variables should be examined in the process. The case study should establish that the negative impact of leadership style on turnover is adjusted through bank practices, for example, through intra-organisational mobility. In a dynamic yield model, you need to understand the process of reducing job satisfaction. You can give an example of the fact that over time the employee begins to feel that she no longer meets his intellectual, emotional or financial needs.
Instructors should guide students so that they associate the need to retain workers with a safe, healthy work environment and harmonized work relationships. Students should understand that at the given moment the emphasis is on creating a motivating environment and encouraging employees, and for this purpose retention of key groups of employees is used. In modern GCC realities, it is fashionable to highlight some approaches to retaining personnel, such as changing human capital, social exchange, and the resource approach of causal formats. As part of the development of human capital, the attitude of employees to the bank is considered in terms of their own benefits. Students need to understand that the likelihood that an employee will remain in the company falls when he is not satisfied with the job, since the costs associated with leaving are insignificant, and the value of the new job is high, especially if a comparable compensation package is offered.
In considering the resource approach, it is important to indicate that the greatest value of employees lies in their internal qualities and skills, value contribution to the company’s results. The quality of key employees necessary for the organisation should be supported by practices at the bank, including through career management. Using a set of retention practices, the bank creates an additional benefit, since it is difficult for competitors to copy it. According to the conclusions of students, it should be clear that the factors of voluntary turnover are the nature of the work performed, employee participation in production processes, fairness in the distribution of benefits and responsibility for the family. It also includes job involvement, autonomy, fairness of remuneration, career growth and social support are factors of satisfaction.
Strategic theories may include factors of intention to leave or stay in the organisation. It includes a set of variables related to professional characteristics, organisational context, and individual characteristics of employees, including generational ones. Therefore, the study of the degree of youth’s satisfaction with a career and the factors in the formation of intentions to leave or stay in this banking sector is useful for accumulating data on the specifics of industry labour behaviour and adjusting hiring technologies. In connection with the focus of the case on SMPF and the fluidity in incrementing theory and weak connection of results with practice, it is advisable to consider the problem of high youth mobility and career management taking into account requests and situations in specific organisations.
In conclusion, the problem of career motivation of professional activity of youth is one of the keys in the analysis of the case. Projects of career conditions for professional youth groups are widely represented. Career as a condition for unlocking the potential of young professionals is considered in a case study. Career value, predictability and the absence of unnecessary rules, flexibility are included in the key values of young builders, which emphasizes the urgency of the problem in a strategic plan. In the case study, the issues of youth orientation to work in the banking sector are studied by students. In addition, it is important to guide students so that they understand career paths taking into account gender and age, which are determined by the professional environment as well.
Reference List
Augustine, B. D. (2020) ‘RAKBank 2019 net profit at Dh1.09b’, Business, (February). Web.
Bank profile (2020) Web.
Barney, J. B. and Hesterly, W. S. (2010) Strategic management and competitive advantage: concepts and cases. New Jersey: Prentice Hall.
Bose, I. (2018) ‘Employee empowerment and employee performance: an empirical study on selected banks in UAE’, Journal of Applied Management and Investments, 7(2), pp. 71-82.
Campbell, D., Edgar, D. and Stonehouse, G. (2011) Business strategy: an introduction. Basingstoke: Palgrave Macmillan.
Collings, D. G., Mellahi, K. and Cascio, W. F. (2019) ‘Global talent management and performance in multinational enterprises: a multilevel perspective’, Journal of Management, 45(2), pp. 540-566.
Kaplan, R. S., and Norton, D. P. (2005) ‘The balanced scorecard: measures that drive performance’, Harvard Business Review, pp. 71-79.
Kim, W. C. and Mauborgne, R. (2004) ‘Blue ocean strategy’, Harvard Business Review, pp. 76-84.
Meyer, K. E. and Xin, K. R. (2017) ’Managing talent in emerging economy multinationals: integrating strategic management and human resource management’, The International Journal of Human Resource Management, 29(11), pp. 1827-1855.
Mohamud, M. and Sarpong, D. (2016) ‘Dynamic capabilities: towards an organizing framework’, Journal of Strategy and Management, 9(4), pp. 511-526.
O’Shannassy, T. (2008) ‘Sustainable competitive advantage or temporary competitive advantage: improving understanding of an important strategy construct’, Journal of Strategy and Management, 1(2), pp. 168-180.
Pisano, G. P. (2015) ‘You need an innovation strategy’, Harvard Business Review, 93(6), pp. 44-54.
RAKBANK Profile (2020) Web.
Report of consolidated financial statements for the year ended 31 December 2017 (2018) Web.
Welcome to RAKBANK (2020) Web.
Who we are (2020) Web.
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