Management Functions and Organizational Behavior of the City Bank Limited, Bangladesh

1.1.      An Overview of the City Bank Ltd.

City Bank is one of the oldest private Commercial Banks operating in Bangladesh. It is a top bank among the oldest five Commercial Banks in the country which started their operations in 1983. The Bank started its journey on 27th March 1983 through opening its first branch at B. B. Avenue Branch in the capital, Dhaka city. It was the visionary entrepreneurship of around 13 local businessmen who braved the immense uncertainties and risks with courage and zeal that made the establishment & forward march of the bank possible. Those sponsor directors commenced the journey with only Taka 3.4 crore worth of Capital, which now is a respectable Taka 330.77 crore as capital & reserve. 

City Bank is among the very few local banks which do not follow the traditional, decentralized, geographically managed, branch based business or profit model. Instead the bank manages its business and operation vertically from the head office through 4 distinct business divisions namely 

• Corporate & Investment Banking; 

• Retail Banking (including Cards); 

• SME Banking; & 

• Treasury & Market Risks. 

Under a real-time online banking platform, these 4 business divisions are supported at the back by a robust service delivery or operations setup and also a smart IT Backbone. Such centralized business segment based business & operating model ensure specialized treatment and services to the bank's different customer segments. 

The bank currently has 90 online branches and 1 SME service centers and 11 SME/Agri branch spread across the length & breadth of the country that include a fully fledged Islamic Banking branch. Besides these traditional delivery points, the bank is also very active in the alternative delivery area. It currently has 140 ATMs of its own; and ATM sharing arrangement with a partner bank that has more than 550 ATMs in place; SMS Banking; Interest Banking and so on. It already started its Customer Call Center operation. The bank has a plan to end the current year with 200 own ATMs.

City Bank is the first bank in Bangladesh to have issued Dual Currency Credit Card. The bank is a principal member of VISA international and it issues both Local Currency (Taka) & Foreign Currency (US Dollar) card limits in a single plastic. VISA Debit Card is another popular product which the bank is pushing hard in order to ease out the queues at the branch created by its astounding base of some 400,000 retail customers. The launch of VISA Prepaid Card for the travel sector is currently underway. 

City Bank has launched American Express Credit Card and American Express Gold Credit card in November 2009. City Bank is the local caretaker of the brand and is responsible for all operations supporting the issuing of the new credit cards, including billing and accounting, customer service, credit management and charge authorizations, as well as marketing the cards in Bangladesh. Both cards are international cards and accepted by the millions of merchants operating on the American Express global merchant network in over 200 countries and territories including Bangladesh. City Bank also introduced exclusive privileges for the card members under the American Express Selects program in Bangladesh. This will entitled any American Express card members to enjoy fantastic savings on retail and dining at some of the finest establishment in Bangladesh. It also provides incredible privileges all over the globe with more than 13,000 offers at over 10,000 merchants in 75 countries. 

City Bank prides itself in offering a very personalized and friendly customer service. It has in place a customized service excellence model called CRP that focuses on ensuring happy customers through setting benchmarks for the bank's employees' attitude, behavior, readiness level, accuracy and timelines of service quality. 

City Bank is one of the largest corporate banks in the country with a current business model that heavily encourages and supports the growth of the bank in Retail and SME Banking. The bank is very much on its way to opening many independent SME centers across the country within a short time. The bank is also very active in the workers' foreign remittance business. It has strong tie-ups with major exchange companies in the Middle East, Europe, Far East & USA, from where thousands of individual remittances come to the country every month for disbursements through the bank's large network of 99 online branches and SME service centers. 

The current senior management leaders of the bank consist of mostly people from the multinational banks with superior management skills and knowledge in their respective "specialized" areas. The newly launched logo and the pay-off line of the bank are just one initial step towards reaching that point. 

 2.   Management Functions

2.1 Planning

2.1.1 Vision:

The vision of city bank limited is:

“The Financial Supermarket with a Winning Culture Offering Enjoyable Experiences”

  

2.1.2 Mission:

The Mission statements are:

• Offer wide array of products and services that differentiate and excite all customer segments
• Be the “Employer of choice” by offering an environment where people excel and leaders are created
• Continuously challenge processes and platforms to enhance effectiveness and efficiency
• Promote innovation and automation with a view to guaranteeing and enhancing excellence in service
• Ensure respect for community, good governance and compliance in everything we do.

2.1.3 Objectives (financial and strategic):

Here are some basic objectives of the city bank ltd.:

·      Ensure customer delight

·      Ensuring transparency

·      Ensuring effective and efficient banking

·      Consume as less time as possible in satisfying customers

·      Provide new services to customers with superior information technology platform

·      Improve human resource quality.

·      Ensure effective risk management.

·      Achieve shareholder’s confidence

                             

2.2 The Organizational Chart:

The organizational chart of the city bank ltd is as below. 

                         

2.3 Leadership Style:

The city bank limited uses a mixed style of leader ship.  But basically, as we came to identify, the leadership style is a mixture of Relationship Oriented Leadership, Transformational Leadership and Situational Leadership. In some departments of the bank, Task Oriented and Transactional Leadership does exists.

A short explanation of the leadership styles:

Relationship Oriented Leadership: A participative style, it tends to lead to good teamwork and creative collaboration. This type of leadership was identified in the Information and technology department of the bank.

Transformational Leadership: this type of leaders generally gives a brief explanation about the future of the group. They inspire to share views and values and are very much effective communicator. This type was observed in the marketing department of the bank.

Situational leadership: leadership style depending on situation that is given. This type sustains in the higher level management of the organization. 

Task oriented leadership: more like Autocracy where subordinates are bound to carry orders. This is a very effective type in the Financial Planning and Human Resource department.

Transactional leadership: is this system, subordinates are paid for performing a specific task. This type exists in the research and development department, where the research teams are paid smart incentives for finding out positions for opening new branches.

                                       

2.4 Controlling:

The board of directors provides governance, guidance and oversight to senior Management. It is responsible for approving and reviewing the overall business strategies and significant policies of the organization as well as the organizational structure. The board of directors has the ultimate responsibility for ensuring that an adequate and effective system of internal controls is established and maintained. Board members are objective capable and inquisitive with a knowledge or expertise of the activities of and risks run by the bank. This board is strong, active board, particularly coupled with effective upward communication channels and capable financial, legal, and internal audit functions. They provide an important mechanism to ensure the correction of problems that may diminish the effectiveness of the internal control system.

Generally, the senior management who are the subordinates of the board members divides the task of different business unit according to the goal that has been decided for them. And from a higher position of the organizational chart, the keep eye on the performance and supervise where needed.

In the root level the picture is totally different from other banks. Rather than designating all the employees under branch manager and assistant branch manager, there are different groups for carrying out different tasks. For example, in every branch there is an operational department, whose task is to supervise the new account openings and helping clients with the Loan transactions. Basically in these groups all employees are of same designation and under one operational manager.

At the end of the day, these group managers report to the Branch manager. So, it is clearly seen that, in The City Bank Limited, the responsibilities of branch managers are not that much heavy like other banks. What they do is, supervise if all policies of Bangladesh Bank and the Company itself are being followed or not and if any group leaders need any guidance they provide them. So, it is understood that their duties are divided amongst his sub ordinates.

                             

3. Organizational Behavior:-

1. Employee motivational tools used within the organization:

Employee motivation process in City Bank has some specialty for attaining their organizational goal. The bank uses different types of motivational tools as well as internal and external motivation.

Tools for motivating employees fall into two basic categories. The first is external or extrinsic. These tools deal with physical or monetary rewards, such as bonuses or child care. The second category is internal or intrinsic. These rewards meet a psychological or personality need of employees, such as feelings of validation or pride in a job well done.

Tool type:-

1. Internal or intrinsic motivation:

Empowerment: Empowerment is an intrinsic motivator. City Bank does empower employees by giving them individual responsibilities and the authority to make at least basic decisions. They also motivate employees by encouraging them to be as creative and innovative as possible.

Self-Improvement: City Bank self-improvement programs allow employees to receive the training or classes they need to be better at their jobs. This motivates employees in two ways. First, it shows employees the company believes they are capable of achieving with additional skills or information.

Recognition/Attention: When employees accomplish something they have achieved something recognition is appreciation for that achievement. City Bank promotes their best employee of the year to give such recognition.

Applause: City Bank physically applauds people by giving them a round of applause for specific achievements.

One-on-One Coaching: Coaching is employee development only cost is time. Time means care. City bank has training facility. Training schedule "tune- up" training sessions will continually enhance the performance of people and the productivity of business.

Career Path. Employees need to know what is potentially ahead for them, what opportunities there are for growth. This issue is a sometimes forgotten ingredient as to the importance it plays in the overall motivation of people. City bank sets career paths within organization for helping employee.

Job Titles: City Bank talks about job titles and tapping the self-esteem of people. Someone feels about the way they are perceived in the workforce is a critical component to overall attitude and morale.

On-the-Spot Praise: This too is associated with recognition but the key here is timing. When there is a reason for praising someone for any reason! Promptness equals effectiveness.

Leadership Roles: City Bank gives people leadership roles to reward their performance and also to help to identify future promotable people. Most people are stimulated by leadership roles even in spot appearances. For example, when visitors come to workplace use this opportunity to allow an employee to take the role of visitors guide.

Team Spirit: Here people like to physically see themselves as part of a group or team.

Executive Recognition: This is the secret weapon. And like any secret weapon, timing is most critical. If this is used too often the value is diminished. And if it is used only for special occasions and rare achievements the value is escalated.

Social Gatherings: Scheduled offsite events enhance bonding which in turn helps team spirit, which ultimately impacts City Bank positive work environment.

Time Off: Implement contests that earn time off. People will compete for 15 minutes or 1/2 hour off just as hard as they will for a cash award.

Outside Seminars: Outside seminars are a stimulating break. City Bank does outside seminars for most people; consider on-site seminars or workshops for the staff.

Additional Responsibility: There are definitely employees in organization who are begging for and can handle additional responsibility.

Theme Contests: Over the years contests have produced up to 170% increase in performance. But equally as important, contests helped maintain positive environments that have reduced employee turnover by 400%.

Stress Management: City Bank provides articles and books on this subject. They make sure they know it is available and encourage them to use it.

2. External or extrinsic motivation:

Life Enhancement: Some employees underperform or resist company change or instructions because of things happening in their lives. So City Bank arranges motivational program to enhance employee life by giving bonuses, ceremonial/celebration incentives etc.

Good Work Environment: City Bank provides excellently decorated office spaces. This for sure gives a positive vibe in the minds of the employees.

2. Organizational Structure:

City Bank is among the very few local banks which do not follow the traditional, decentralized, geographically managed, branch based business or profit model. Instead the bank manages its business and operation vertically from the head office through 4 distinct business divisions namely

I.           Corporate & Investment Banking;

II.         Retail Banking (including Cards);

III.        SME Banking; &

IV.        Treasury & Market Risks.

Under a real-time online banking platform, these 4 business divisions are supported at the back by a robust service delivery or operations setup and also a smart IT Backbone. Such centralized business segment based business & operating model ensure specialized treatment and services to the bank's different customer segments.

The bank currently has 90 online branches and 1 SME service centers and 11 SME/Agri branch spread across the length & breadth of the country that include a fully fledged Islamic Banking branch. Besides these traditional delivery points, the bank is also very active in the alternative delivery area. It currently has 140 ATMs of its own; and ATM sharing arrangement with a partner bank that has more than 550 ATMs in place; SMS Banking; Interest Banking and so on. It already started its Customer Call Center operation. The bank has a plan to end the current year with 200 own ATMs.

3. Organizational Culture:

The Top Level Management of City Bank ltd. stated their culture as follows:

“…This triumphant journey has been possible only because at CBL we believe in a culture that is rewarding. In line with our Vision, CBL encourages each individual to achieve their true potential. Being a part of CBL, one has the opportunity to work in his/her area of expertise or one that he/she is interested in. We are a fast growing and superior bank, not only in terms of our products and services but also in terms of our people philosophy. Whichever function one might choose, be it Core banking, Finance, Brand, HR or any other functions, we at CBL foster a Winning Culture for both our internal and external stakeholders and ensure our talents can grow and excel in both functional and leadership front.

• The Financial Supermarket with a Winning Culture Offering Enjoyable Experiences.
• Offer wide array of products and services that differentiate and excite all customer segments
• Be the Employer of choice by offering an environment where people excel and leaders are created
• Continuously challenge processes and platforms to enhance effectiveness and efficiency
• Promote innovation and automation with a view to guaranteeing and enhancing excellence in service
• Ensure respect for community, good governance and compliance in everything we do is result driven
• Accountable & Transparent, courageous & respectful, engaged & inspired focused on customer delight….”

 4. Conclusion

The City Bank Limited as per Bangladesh Bank’s ranking is the 3^rd biggest bank in our country. While working within our limited scope, we tried our best to present the information. Yet, through this assignment anyone can have a glimpse inside management of The City Bank Ltd. We tried to discuss about different managing tools, spreading its wings from planning to the culture inside the organization, from basic organizational chart to the vast banking network throughout Bangladesh. Some flaws might be there in this assignment, as we had to handle a huge amount of data from online, reference books and some stuffs of The City Bank itself. 

4.1 References

• Organizational behavior, Robbins Judge, 13^th Edition. (Chapter 7, pg# 246 and onwards)
• www.wikipedia.com (for definitions and other explanations)
• www.thecitybank.com.bd (annual report, highlights, CEO’s message, Chairman’s Message)
• Wanda Thibodeaux, Demand Media, www. smallbusiness.chron.com
•  Mr. Mabrur Hasan Chowdhury was asked several questions about the internal affairs. He is currently working as Cluster Branch Operations Manager (Dhaka Outer). And his office is in The City Bank Ltd, Dhanmondi Branch, Rd No. 27, Dhanmondi. (opposite of Meena Bazaar)