'Perform or perish' scares old banks' staff

New age banks thrive on target-based performance of their employees, sharply contrasting the tradition practiced in the old private sector banks.

"Deliver or quit" is the HR philosophy at most new private sector banks and that's what, bankers feel, is making the employees at Lord Krishna Bank (LKB) nervous as the Kerala-based bank merges with new-age Centurion Bank of Punjab.

The latest is complete cultural transformation of Mumbai-based Development Credit Bank (DCB). It happened as a new top management took charge to turnaround the bank.

The new management adopted a "perform or perish" policy and provided an exit route to employees not wanting to be part of the new environment.

Bankers said this fear must have made LKB employees nervous and that's why they are seeking to merge the bank with a public sector bank, where they could culturally fit in easily. This fear is also forcing them to raise the bogey of the merged entity closing down all the rural branches.

A DCB official had recently said the bank had to change and introduce performance-linked employment policies to become a bank that matters and provides returns for its stakeholders.

The employees of LKB, who are on an indefinite strike since September 6, want LKB and CBoP to withdraw their merger plans, saying LKB should be merged only with one of the government-owned banks.

LKB employees unions say the salary structures of both the banks are different as CBoP has performance-linked salary packages, while in LKB the Indian Banks' Association-approved salary scale is implemented. Contract system in CBoP will also be a serious threat to employees of LKB and a vast majority employees believe that there would be compulsory VRS in future.

Aggressive banks like ICICI have daily, monthly, annual targets for their employees and that's what led to a phenomenal growth in the bank's retail business in the last couple of years.