6 th EMN Conference Microfinance and its Growth in Europe: Consequences, challenges, opportunities Workshop: “How to manage the growth of your staff?” prof. Roberto Moro Visconti Università Cattolica - MILANO

M – banking and HR branchless banking at any time can deeply change HR management within the microfinance industry: branchless banking at any time can deeply change HR management within the microfinance industry: less branches, fewer logistic & transportation costs less branches, fewer logistic & transportation costs more ICT development more ICT development HR have to adapt to a profoundly changing business model (e.g., see how ICT has changed traditional banks) HR have to adapt to a profoundly changing business model (e.g., see how ICT has changed traditional banks) fewer and more centralized employees with higher technical skills fewer and more centralized employees with higher technical skills possibility of some economies of scale, able to reduce operating costs possibility of some economies of scale, able to reduce operating costs

M – banking trends Ten years ago, there was no active m- banking. Global cell phone penetration stood at 8% (0% among low income countries). Ten years ago, there was no active m- banking. Global cell phone penetration stood at 8% (0% among low income countries).cell phone penetrationcell phone penetration Now, in 2009, much has changed: branchless banking channels are now widely accepted as a means of extending the reach of the banking system. Now, in 2009, much has changed: branchless banking channels are now widely accepted as a means of extending the reach of the banking system. The potential of m-banking is sometimes described in breathless terms, based in part on the meteoric increase in wireless coverage. Some 80% of the world’s population is within coverage and there are more than 4 billion cell phone subscriptions. The potential of m-banking is sometimes described in breathless terms, based in part on the meteoric increase in wireless coverage. Some 80% of the world’s population is within coverage and there are more than 4 billion cell phone subscriptions. The potential of m-banking is sometimes described in breathless terms4 billion cell phone subscriptions The potential of m-banking is sometimes described in breathless terms4 billion cell phone subscriptions

from mobile to branchless banking Mobile banking is a term used for performing balance checks, account transactions, payments etc. via a mobile device such as a mobile phone. Mobile banking today (2007) is most often performed via SMS or the Mobile Internet... Mobile banking is a term used for performing balance checks, account transactions, payments etc. via a mobile device such as a mobile phone. Mobile banking today (2007) is most often performed via SMS or the Mobile Internet...mobile phoneSMSMobile Internetmobile phoneSMSMobile Internet

wireless penetration trends

M – banking: strategic drivers and HR

Academic training of HR in MF is it better to train MF officers at their home or in Western countries ? is it better to train MF officers at their home or in Western countries ? pros and cons pros and cons external versus domestic training external versus domestic training the Academic experience is mixed: the Academic experience is mixed: few professors are expert of MF; need for a more tailor made and professional orientation few professors are expert of MF; need for a more tailor made and professional orientation studying and reading books is not enough: practical on field experience is highly wanted studying and reading books is not enough: practical on field experience is highly wanted students often don’t have any previous job experience students often don’t have any previous job experience a basic economic backgroung is recommended a basic economic backgroung is recommended

Human Resources Best Practices The best practices in the management of human resources are the ones which: optimize a workforce so that it can not only get more done, optimize a workforce so that it can not only get more done, but also ensure a greater level of efficiency, timeliness and quality as it accomplishes increases productivity overall. but also ensure a greater level of efficiency, timeliness and quality as it accomplishes increases productivity overall.

The important areas in which the best human resources practices must be applied include the creation of viable and attractive benefits and compensation packages: The important areas in which the best human resources practices must be applied include the creation of viable and attractive benefits and compensation packages: managing the performance of employees, managing the performance of employees, making sure that business practices and worker conditions stay well within the law, making sure that business practices and worker conditions stay well within the law, creating a positive, enjoyable work environment, talent recruitment creating a positive, enjoyable work environment, talent recruitment mapping out the best human resources strategy for the future. mapping out the best human resources strategy for the future.

looking for incentives … When browsing job listings, two of the first features that prospective talent looks for are: When browsing job listings, two of the first features that prospective talent looks for are: the salary levels the salary levels and the benefits packages. and the benefits packages.

Best practices - HR An important aspect of best practices when it comes to providing optimal human resources services is the accurate and productive evaluation and enhancement of performance among the employee base. An important aspect of best practices when it comes to providing optimal human resources services is the accurate and productive evaluation and enhancement of performance among the employee base. performance management is one of the key functions of a human resources department, and should be approached with any one of a number of the proven techniques of metrics and evaluation that strives toward best practices in the realm of performance management. performance management is one of the key functions of a human resources department, and should be approached with any one of a number of the proven techniques of metrics and evaluation that strives toward best practices in the realm of performance management.

As human resources is all about maintaining a positive and productive work environment, best practices helps to make sure that employees feel good about the company they work for. As human resources is all about maintaining a positive and productive work environment, best practices helps to make sure that employees feel good about the company they work for. In MF, a social mission target is important for the motivation In MF, a social mission target is important for the motivation

HUMAN RESOURCES BOTTLENECK The development finance industry is increasingly recognizing its human resource “bottleneck”: The development finance industry is increasingly recognizing its human resource “bottleneck”: skilled middle and senior managers are difficult to find and retain; skilled middle and senior managers are difficult to find and retain; HR departments lack tools and systems to service ever- growing staff; limited resources are available for training and skills enhancement; and there is almost no knowledge sharing around best practices. HR departments lack tools and systems to service ever- growing staff; limited resources are available for training and skills enhancement; and there is almost no knowledge sharing around best practices. According to some industry estimates, in order to meet the anticipated demand for microfinance, the industry will have to hire 12.5 million new loan officers, assuming a loan officer to client ratio of 1:300. This bottleneck threatens to constrain the growth, success and development potential of high- growth microfinance and small business finance providers. According to some industry estimates, in order to meet the anticipated demand for microfinance, the industry will have to hire 12.5 million new loan officers, assuming a loan officer to client ratio of 1:300. This bottleneck threatens to constrain the growth, success and development potential of high- growth microfinance and small business finance providers.

Problems and recommendations the sector offers little in the way of career planning or a clear advancement strategy for staff the sector offers little in the way of career planning or a clear advancement strategy for staff many organizations have not implemented or put in place formal training policies. many organizations have not implemented or put in place formal training policies. many MFIs have no incentive system in place, or if they do, then they are incomplete or not properly used. many MFIs have no incentive system in place, or if they do, then they are incomplete or not properly used.

need for HR information systems or automation of current HR systems, i.e. technology issues need for HR information systems or automation of current HR systems, i.e. technology issues staff capacity building and training staff capacity building and training training and/or technical assistance in HR is a “Top priority–among the most urgent needs” training and/or technical assistance in HR is a “Top priority–among the most urgent needs”

Human Capital Management System Rewards Culture HR Planning Recruitment & Selection Learning & Development Retention & Engagement Performance Planning & Management

recent trends due to the financial crisis, many banks in western countries are expelling qualified workers due to the financial crisis, many banks in western countries are expelling qualified workers they may quite easily be ricycled in the MF industry they may quite easily be ricycled in the MF industry