Stakeholder Value Creation
The credit for the success of J&K Bank goes to the people who run it
DR NAZIR AHMAD GILKAR
The financial results of J&K Bank for half year, ended 30th September, 2012 can be analysed, at least, on the following two performance measures:
• Efficacy in conversion process of deposit products into credit products
• Share of employees from this added conversion process.
The bank has been able to create value through the conversion process to the tune of Rs 1035.55 cr during the period under report. This works out 32.76 percent of the aggregate earnings. The employees of the bank have preferred their claim for 27.12 percent for their share from this addition. This means that they have leftover 72.88 percent or Rs 754.67 cr to other stakeholders like shareholders and for societal prosperity and the bank for its further growth. The employees of the bank are the people who contribute towards this addition through the conversion process of financial inputs into output. They deserve all appreciation for their devotion and dedication as they work dawn to dusk round the year against all odds.
The net value added has shown a surge in annual growth at 20.25 percent as against 15.55 percent growth per annum in aggregate earnings based on CARG for last several years. This has been possible simply because of more CASA deposits in the deposit-mix, slow growth in cost of depreciation and other operating costs, and strict control on risk management. Faster growth in NVA is a result of economy in deposit costs in comparison to high yield on advances.
The top-line devises strategies which are executed by the frontline workforce at each business unit of the bank. Really in an organization people matter for creative ideas and effective execution. The customers of the bank both on the demand as well as supply side, of course, have reposed their full faith in the performance of the bank. It has been seen that the bank has won their loyalty as they remain wedded to the bank and dislike defection. The role of employees is also laudable because of the fact that they serve the clientele to their best abilities. The Bank-Customer relationship is cordial. The bank has an exemplary work culture. In this context punctuality is the major contributor. It has been observed even at far off destinations that the bank employees are available well in time and they leave their work spot only after the scheduled time.
The J&K Bank plays a gigantic role in the economic development of the state economy. The bank is not only strong as regards its financial fundamentals assessed in terms of commercial profitability and productivity but in reference to its social profitability as well. This organization is stable especially in the present competitive environment because of its people. The bank possesses adequate intellectual capital in terms of practice and profession. May the bank diversify and establish a corporate education and research institute as the corporate sector has done in elsewhere.
The bank has enough scope for expansion in its operations. As a sequel to it more hands are required.HR and Marketing need to be strengthened by forging combined thinking, professional opinions, joint efforts, collective wisdom, technology intervention to translate missions into realities through synergy in activities.
The author is Principal SP College.
Lastupdate on : Thu, 15 Nov 2012 21:30:00 Makkah time
Lastupdate on : Thu, 15 Nov 2012 18:30:00 GMT
Lastupdate on : Fri, 16 Nov 2012 00:00:00 IST
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