Introduction
Performance management is one of the key components of the modern internal business organizational model. As highlighted by Belcourt et al. (2019), employees’ qualifications, professional skills, and commitment to the task are crucial components for long-term success. As these elements play a considerable role, the performance and requirements are constantly monitored. Regular check-ups, also known as performance reviews, include various KPIs, strategical approaches, and general performance management. The combination of different methods as well as individual strategies is conducted by TD Canada Trust Bank as well.
Considering and assessing the performance of the TD Canada Trust Bank management teams, it could be noticed that they follow a complex structure applying the periodical assessments to maximize performance. Belcourt et al. (2019) highlight that employees’ responsibilities include profitability management covering system implementation, measurement methodology advice, segments’ productivity diagnostics, and the construction of profitable models. On the other hand, the role of the performance management team within the bank structure is mainly directed at providing performance indicators such as activity-based costing, fund transfer pricing, and profitability modeling.
Weaknesses and Strengths
The system implemented by the TD Canada Trust Bank management displays a good example of a financial, organizational structure with a corresponding evaluation system. This management is well-planned, industry-orientated, and effective for customer satisfaction, as it allows to manipulate and determine the goals daily (The Performance Measurement Revolution, 2021). One feature of this system is that regulators control bank systems, including TD Canada Trust Bank providing stable and consistent performance regardless of the state of the market. This allows controlling the large-scale system facilitating a certain degree of independence and stability. Belcourt et al. (2019) explain this process by the fact that local management works not only with the specification of balance sheets and liquidity profiles but also considers profit-and-loss statement tracking of performance and sustainability scales. Consequently, bank officials cannot hide any deviations and manipulations from the declared business model. As control and monitoring degree are considerably higher, bank officials’ freedom is limited to analyze performance and identify feature course of actions.
Comparing TD Canada Trust Bank’s performance with other businesses outside the financial sector, considerable differences in approach and operational methods could be noticed. According to The Performance Management Revolution (2021), the main four assessment components are outstanding commercial loans per loans officer, new merchants accounts, commercial loan decision time as well as default loan service. The main consideration at this point is the commercial loans per loan officer’s performance that provide data about the ratio between the total retail loan amount regulated by the bank and the number of employees required. This tracking helps the bank maintain the balance between the employers and work amount, avoiding understaffing in various departments.
On the other hand, the commercial loan decision cycle time represents the time span needed for the bank to accept or reject the loan application. The Performance Management Revolution (2021) declares that this component directly influences the customer’s satisfaction rate related to the bank’s performance. Fast decisions and a smaller amount of time positively affect customers’ satisfaction by reducing insecurity levels. Talking about TD Canada Trust Bank’s KPI indicators, they analyze and track a great range of problems such as non-standardized data input operations, the absence of data processing tools, and poor personnel performance. An appropriate regulation could fully diminish this problem and increase productivity.
In comparison, the new merchant accounts show the direct KPI related to the customer activity and look for future perspectives transforming potential customers to existing clients. Reinventing Performance Management (2021) emphasizes that the devastating effects of the COVID-19 pandemics lead to the gradual change of priorities. Now, banks focus on creating a reliable image, as well as responsible and efficient position in the market. Lastly, loan servicing KPIs analyze the bank services’ current state, evaluating current loans, and preparing for future obstacles.
Proposed Improvement
Considering the system proved its efficiency and showed great results, some obstacles are associated with check-ins and regulation. TD Canada Trust Bank attempts to identify the root of the problem and eliminate it rather than simply avoiding it. According to Reinventing Performance Management (2021), this type of management includes comprehensive improvements in employees’ performance and client management systems. Without generating a complete employee performance assessment, performance management is useless. The improvement strategy is announced and outlines according to the key areas and individual employees’ performance. However, these measures are not properly controlled by the higher instances. The problem of the daily check-ins could be resolved by organized and structured management, which requires a higher number of managers for different sectors. To improve the performance management system the company must focus on weekly/monthly employee performance reviews, which could help reaching a sustained completion.
Conclusion
To conclude, the performance management system implemented in the TD Canada Trust Bank corresponds to the international financial sector management standards. This system reflects the values of accountability, objectivity, and motivation required for customer satisfaction and balanced performance. Despite the problems in the daily organization, both client and the bank benefits from the presented system, as it includes benefits for both parties.
References
Belcourt, M., Bohlander, G. W. & Morris, S. (2019) Managing Human Resources (9th ed). Nelson ISBN-10: 978-0-176-79805-5.
The Performance Management Revolution. Harvard Business Review. (2021). Web.
Reinventing Performance Management. Harvard Business Review. (2021). Web.