**Capacity Assessments for Improving Corporate Efficiency – Case of Limassol Turkish Cooperative Bank in Northern Cyprus**

Mustafa Ertann and Okan Veli Şafakl

*European University of Lefke, Faculty of Business and Economics Department of Business Administration, Lefke North Cyprus* 

## **1. Introduction**

28 Business Dynamics in the 21st Century

Vroom, V. H. & Kenneth, R. M. (1968). Toward a Stochastic Model of Managerial Careers,

Willard, B. (2006). O sucesso de um projeto sob uma nova ótica de mensuração, *World Project* 

Yu, W. Smith, D. & Huang, S. (1991). Software productivity measurements, *Proceedings of* 

Zanelli, J. C., Andrade, J. E. B. & Bastos, A. V. B. (2004). *Psicologia, Organizações e Trabalho no* 

*Administrative Science Quarterly,* 13 (1), pp. 26-46. June, 1968.

*Management*, pp. 38-45, july, 2006. Portuguese version only.

*Computer Software and Applications Conference*, 1991.

*Brasil*, Artmed, Porto Alegre. Portuguese version only.

Ever increasing challenges in real and financial sectors, the more so often global and territorial crises, the concentration and adjustments in banking regulations, the increased competition level in banking (due to deregulations and cross-border banking competitions) and the social factors such as banking ethics, customers' maturing perception of bank services, consumer satisfaction add pressure to any bank's Board of Directors (BOD) for paving new paths in overall management directions. Sustainability concerns and social responsibilities create a new and more complicated mix in which the bank employees at all levels continue to be a major factor reasoning the success and profitability levels of the organization.

Periodical staff and management performance evaluations are now more than a trendy tradition in corporations. Outcomes of performance evaluation affect the staff structure in both management and operations. Performance evaluations use criteria to evaluate the overall ability of staff in fulfilling the duties and tasks assigned to them. The results also indicate the employees' corporate values and social responsibility values. Employees subject to any performance evaluation are expected to be staff with appropriate education, training, experience, and ability to manage the tasks and duties that, their job requires.

This study evaluates the necessity of Capacity Assessment to employees prior to exercising performance evaluation to them. By implying Capacity Assessment, staff is initially evaluated if they are equipped with knowledge enough to handle the tasks. Capacity Assessment will also scale the corporate attitude of the employee. Team-workers, leaders, innovators, communicators, and silent abilities are filtered, whereas each one's strengths and underdeveloped skills are projected in the outcome.

Methodology of the study and the challenges to ensure participation of the Board (Saskatoon, 2004) are as follows:


Capacity Assessments for Improving Corporate Efficiency –

(UNDP, 1998; UNDP, 2006).

Case of Limassol Turkish Cooperative Bank in Northern Cyprus 31

of people, organizations and society as a whole to manage their affairs successfully (OECD-DAC Network on Governance, 2006), and "ability of an organization to function as a resilient, strategic and autonomous entity (Kaplan, 2007)". These definitions imply that capacity is not a passive state but part of a continuing process and that human resources are central to capacity development. The overall context within which organisations undertake their functions are also key considerations in capacity development. Therefore, capacity is the power of something (a system, an organisation, a person) to perform or to produce

The following five central characteristics or aspects of capacity can begin to give the theory

 Capacity is about empowerment and identity, properties that allow an organization or system to survive, to grow, diversify, and become more complex. To evolve in such a way, systems need power, control, and space. Capacity has to do with people acting

 Capacity has to do with collective ability, i.e. that combination of attributes that enables a system to perform, deliver value, establish relationships and to renew itself. Or put another way, the abilities that allow systems - individuals, groups, organizations, groups of organizations - to be able to do something with some sort of intention and

 Capacity as a state or condition is inherently a systems phenomenon. Capacity is an emergent property or an interaction effect. It comes out of the dynamics involving a complex combination of attitudes, resources, strategies, and skills, both tangible and intangible. It emerges from the positioning of a system within a particular context. In addition, it usually deals with complex human activities, which cannot be addressed

 Capacity is a potential state. It is elusive and transient. It is about latent as opposed to kinetic energy. Performance, in contrast, is about execution and implementation or the result of the application/use of capacity. Given this latent quality, capacity is dependent to a large degree on intangibles. It is thus hard to induce, manage, and measure. As a state or condition, it can disappear quickly particularly in smaller, more vulnerable structures. This potential state may require the use of different approaches

 Capacity is about the creation of public value. All countries, regardless of their level of development, have many examples of effective capacity that subverts the public interest. The most obvious would be organized corruption, the behaviour of gangs and organized conspiracies, and the capture of public institutions. In most countries,

Capacity Development 6 is a concept that is broader than organizational development since it includes an emphasis on the overall system, environment, or context within which

6 This is not much different than the OECD Development Assistance Committee (DAC) definition of Capacity Development, adapted by various donors, as *"... the process by which individuals, groups, organizations, institutions and societies increase their abilities to: (1) perform core functions, solve problems, define and achieve objectives; and (2) understand and deal with their development needs in a broad context and in a sustainable manner."* This definition goes on to define **core capacities** of an organization, or community,

and practice some substantive and operational shape (Morgan, 2006).

together to take control over their own lives in some fashion.

with some sort of effectiveness and at some sort of scale over time.

to its development, management, assessment and monitoring.

different kinds of capacities compete for power, control, and resources.

from an exclusively technical perspective.


Capacity Assessments as in the case studied below will necessitate additional individual and corporate trainings, relocation of personnel, restructuring the departments and even reviewing the company major policies as the case may be.

Limasol Türk Kooperatif Bankas (LTK Bank) is a cooperative firm3 subject to the local company law and is operating as a commercial bank under supervision of local central bank and finance ministry. LTK Bank had a Central Branch and 11 branches and employed 170 including 15 top-level managers when the Capacity Assessment program was initiated in April 2010.

The program was implemented by experienced and qualified Corporate Educators, Mustafa Ertann,4 and Huda Hudaverdi5. The Capacity Assessment interviews for the employees were also done by M. Ertann and H. Hudaverdi.

BOD of LTK Bank and General Manager (GM) participated in some decision-making procedures.

The main structure of this study unique to LTK Bank consists of the Concept of Capacity Assessment and Capacity Development, corporate assessment process and conclusion respectively. This chapter is organized as follows: The first introductory part presents aim, scope, and methodology of the study. The second part explains the Concept of Capacity Assessment and Capacity Development. Third part is devoted to corporate assessment process. Corporate assessment process contents Drafting the project with BOD of LTK Bank; Ensuring the participation of BOD and GM; Briefing the staff and motivating them for professional participation and contribution; Drawing the questioner with key participants and forming the Balanced Scorecard; Interviews for Individual Capacity Assessments; Physical and Management Assessment of Branches and Departments; Evaluating the Data and Reporting to BOD; Capacity Assessment and suggestions to LTK Bank's BOD; and Summary of trainings as an outcome of the capacity assessment program correspondingly. The final part gives conclusive remarks about the study and informs the readers about the limitations of the study and the need of future research.

### **2. The concept of capacity assessment and capacity development**

Capacity is defined as the ability of individuals and organisations or organizational units to perform functions effectively, efficiently and sustainably. Alternatively, capacity can be defined as "The ability of individuals, institutions and societies to perform functions, solve problems and set and achieve objectives in a sustainable manner (UNDP, 2007)", "the ability

 1 Key Performance Indicators as developed by Advanced Performance Institude and others

<sup>2</sup> No HR dept was yet established.

<sup>3</sup> Popular public company type with large number of members owning shares

<sup>4</sup> Co-author of this chapter,Dr, Economics , Lecturer in European University of Lefke and with 30 years of experience in Corporate and Education Issues.

<sup>5</sup>Dr., Senior Lecturer in Girne American University, ex member of various Bank BODs

Completing the Questionnaire as Balanced Scorecard with section for Top and Middle

Capacity Assessments as in the case studied below will necessitate additional individual and corporate trainings, relocation of personnel, restructuring the departments and even

Limasol Türk Kooperatif Bankas (LTK Bank) is a cooperative firm3 subject to the local company law and is operating as a commercial bank under supervision of local central bank and finance ministry. LTK Bank had a Central Branch and 11 branches and employed 170 including 15 top-level managers when the Capacity Assessment program was initiated in

The program was implemented by experienced and qualified Corporate Educators, Mustafa Ertann,4 and Huda Hudaverdi5. The Capacity Assessment interviews for the employees

BOD of LTK Bank and General Manager (GM) participated in some decision-making

The main structure of this study unique to LTK Bank consists of the Concept of Capacity Assessment and Capacity Development, corporate assessment process and conclusion respectively. This chapter is organized as follows: The first introductory part presents aim, scope, and methodology of the study. The second part explains the Concept of Capacity Assessment and Capacity Development. Third part is devoted to corporate assessment process. Corporate assessment process contents Drafting the project with BOD of LTK Bank; Ensuring the participation of BOD and GM; Briefing the staff and motivating them for professional participation and contribution; Drawing the questioner with key participants and forming the Balanced Scorecard; Interviews for Individual Capacity Assessments; Physical and Management Assessment of Branches and Departments; Evaluating the Data and Reporting to BOD; Capacity Assessment and suggestions to LTK Bank's BOD; and Summary of trainings as an outcome of the capacity assessment program correspondingly. The final part gives conclusive remarks about the study and informs the readers about the

Employing the Personnel Department2 to schedule the interview process.

Drawing the Capacity Assessment Questionnaire1

reviewing the company major policies as the case may be.

management (Kaplan and Norton ,1992)

were also done by M. Ertann and H. Hudaverdi.

limitations of the study and the need of future research.

**2. The concept of capacity assessment and capacity development** 

1 Key Performance Indicators as developed by Advanced Performance Institude and others

5Dr., Senior Lecturer in Girne American University, ex member of various Bank BODs

3 Popular public company type with large number of members owning shares

Capacity is defined as the ability of individuals and organisations or organizational units to perform functions effectively, efficiently and sustainably. Alternatively, capacity can be defined as "The ability of individuals, institutions and societies to perform functions, solve problems and set and achieve objectives in a sustainable manner (UNDP, 2007)", "the ability

4 Co-author of this chapter,Dr, Economics , Lecturer in European University of Lefke and with 30 years

April 2010.

procedures.

2 No HR dept was yet established.

of experience in Corporate and Education Issues.

of people, organizations and society as a whole to manage their affairs successfully (OECD-DAC Network on Governance, 2006), and "ability of an organization to function as a resilient, strategic and autonomous entity (Kaplan, 2007)". These definitions imply that capacity is not a passive state but part of a continuing process and that human resources are central to capacity development. The overall context within which organisations undertake their functions are also key considerations in capacity development. Therefore, capacity is the power of something (a system, an organisation, a person) to perform or to produce (UNDP, 1998; UNDP, 2006).

The following five central characteristics or aspects of capacity can begin to give the theory and practice some substantive and operational shape (Morgan, 2006).


Capacity Development 6 is a concept that is broader than organizational development since it includes an emphasis on the overall system, environment, or context within which

<sup>6</sup> This is not much different than the OECD Development Assistance Committee (DAC) definition of Capacity Development, adapted by various donors, as *"... the process by which individuals, groups, organizations, institutions and societies increase their abilities to: (1) perform core functions, solve problems, define and achieve objectives; and (2) understand and deal with their development needs in a broad context and in a sustainable manner."* This definition goes on to define **core capacities** of an organization, or community,

Capacity Assessments for Improving Corporate Efficiency –

Assessment and suggestions to LTK Bank's BOD.

**3.1 Drafting the project with BOD of LTK Bank** 

by both new local banks and foreign bank branches.

**3.2 Ensuring the participation of BOD and GM** 

new departments and divisions.

made of.

planning

their knowledge in customer relations, more specifically in sales.

process, the plan designed during the first step is carried out.

self-assessment questionnaires, or one-on-one interviews (UNDP, 2009).

Case of Limassol Turkish Cooperative Bank in Northern Cyprus 33

and 3) summarize and interpret results. During the second step of the capacity assessment

The capacity assessment team determines the level of desired capacities and assesses the level of existing capacities. This can be done through, for example, focus group discussions,

The Capacity Assessment program specially tailored for LTK Bank will follow the sequence of Drafting the project with BOD of LTK Bank; Ensuring the participation of BOD and GM; Briefing the staff and motivating them for professional participation and contribution; Drawing the questioner with key participants and forming the Balanced Scorecard; Interviews for Individual Capacity Assessments; Physical and Management Assessment of Branches and Departments; Evaluating the Data and Reporting to BOD; and Capacity

Board of Directors, reporting to the Annual General Assembly composed of shareholder cooperative members initially was searching ways to improve the competitiveness of the Bank by either improving the individual performance of each employee or by replacing them with more equipped staff. The ruling vision was to motivate the employees to upgrade

Time management was also an issue that BOD believed that needs attention. The management of the Bank faced dilemma; the traditional in house trained and experienced versus University educated bankers when selecting staff to be promoted and or assigned to

The journey of the bank to Capacity Assessment started with the search for external trainers to provide above up skilling to the staff and to evaluate the performance of the employees. This would justify the BOD's decisions in all staff matters like employment, wages, promotions etc. BOD thus intended to keep up with the increasing competition in the sector

The Capacity Assessment program was suggested by the external evaluators as a method to analyse in more detail the staff and their knowledge and skills in relation with the duties they are assigned. BOD was briefed that they first need to know what the organisation is

Data collected and processed during Capacity Assessment will clearly help to restructure the organisation to a better efficiency by upgrading the knowledge in needed areas and by reshuffling the employees to better matching positions. During the meetings with BOD, also a silent or indirect Capacity Assessment was implemented to the members by bringing to their attention how and what tools capacity assessors use in general. Spiedergram7 helped to

7 a drawing that shows a summary of facts or ideas, with the main subject in a central circle and the most important facts on lines drawn out from it, used invarious spheres of assessment, evaluation and

individuals, organisations, and societies operate and interact (and not simply a single organisation). In the case of development programmes, it includes a consideration of all factors, which affect upon its ability to be developed, implemented and the results to be sustained. Of special concern to development planners and to situations where there are limited resources is the need to build on what exists—to utilize and strengthen existing capacities , rather than to start from scratch . A Capacity Assessment is an analysis of desired capacities against existing capacities; this generates an understanding of capacity assets and needs, which informs the formulation of a capacity development response (UNDP, 2008). According to OECD, Capacity Assessment is structured and analytical process whereby the various dimensions of capacity are assessed within a broader context of systems, as well as evaluated for specific entities and individuals within these systems (OECD, 2006).

In addition to above, the more commonly used definitions of capacity development can be outlined as follows (Lusthaus et al., 1999):


#### **3. The capacity assessment process**

Addressing the questions **'capacity for whom?'** and **'capacity for what?'** helps determine the design of a capacity assessment. Key steps in this process are: Defining the scale and scope of the capacity assessment by selecting point of entry, core issue(s) and capacity(is); Defining desired capacity; Determining the data collection and analysis approach; and Reviewing existing data sources and knowledge (UNDP, 2008). As a result, of the UNDP's experience with capacity assessments to date. It is organized along the different steps of the capacity assessment process: 1) mobilize and design; 2) conduct the capacity assessment;

or sector, (or system) as consisting o f : defining, analyzing the environment or overall system, identifying needs and/or key issues, formulating strategies to respond to or meet needs, devising or implementing actions; assembling and using resources effectively and sustainably, monitoring performance, ensuring feedback, and adjusting courses of action to meet objectives, and acquiring new knowledge and skills to meet evolving challenges

individuals, organisations, and societies operate and interact (and not simply a single organisation). In the case of development programmes, it includes a consideration of all factors, which affect upon its ability to be developed, implemented and the results to be sustained. Of special concern to development planners and to situations where there are limited resources is the need to build on what exists—to utilize and strengthen existing capacities , rather than to start from scratch . A Capacity Assessment is an analysis of desired capacities against existing capacities; this generates an understanding of capacity assets and needs, which informs the formulation of a capacity development response (UNDP, 2008). According to OECD, Capacity Assessment is structured and analytical process whereby the various dimensions of capacity are assessed within a broader context of systems, as well as

In addition to above, the more commonly used definitions of capacity development can be

 Capacity Development is a concept which is broader the organizational development since it includes an emphasis on the overall system, environment or context within which individuals, organizations and societies operate and interact (and not simply a

 Capacity Development is "… any system, effort or process… which includes among its major objectives strengthening the capability of elected chief executive officers, chief administrative officers, department and agency heads and program managers in general purpose government to plan, implement, manage or evaluate policies, strategies or programs designed to impact on social conditions in the community." (Cohen, 1993) Capacity Development: "The process by which individuals groups, organizations, institutions and societies increase their abilities: to perform functions solve problems and achieve objectives; to understand and deal with their development need in a

 Capacity strengthening is an ongoing process by which people and systems, operating within dynamic contexts, enhance their abilities to develop and implement strategies in pursuit of their objectives for increased performance in a sustainable way" (Lusthaus et

Addressing the questions **'capacity for whom?'** and **'capacity for what?'** helps determine the design of a capacity assessment. Key steps in this process are: Defining the scale and scope of the capacity assessment by selecting point of entry, core issue(s) and capacity(is); Defining desired capacity; Determining the data collection and analysis approach; and Reviewing existing data sources and knowledge (UNDP, 2008). As a result, of the UNDP's experience with capacity assessments to date. It is organized along the different steps of the capacity assessment process: 1) mobilize and design; 2) conduct the capacity assessment;

or sector, (or system) as consisting o f : defining, analyzing the environment or overall system, identifying needs and/or key issues, formulating strategies to respond to or meet needs, devising or implementing actions; assembling and using resources effectively and sustainably, monitoring performance, ensuring feedback, and adjusting courses of action to meet objectives, and acquiring new

evaluated for specific entities and individuals within these systems (OECD, 2006).

broader context and in a sustainable manner" (UNDP, 1997)

outlined as follows (Lusthaus et al., 1999):

single organization) (UNDP, 1998).

al. for IDRC, 1999).

**3. The capacity assessment process** 

knowledge and skills to meet evolving challenges

and 3) summarize and interpret results. During the second step of the capacity assessment process, the plan designed during the first step is carried out.

The capacity assessment team determines the level of desired capacities and assesses the level of existing capacities. This can be done through, for example, focus group discussions, self-assessment questionnaires, or one-on-one interviews (UNDP, 2009).

The Capacity Assessment program specially tailored for LTK Bank will follow the sequence of Drafting the project with BOD of LTK Bank; Ensuring the participation of BOD and GM; Briefing the staff and motivating them for professional participation and contribution; Drawing the questioner with key participants and forming the Balanced Scorecard; Interviews for Individual Capacity Assessments; Physical and Management Assessment of Branches and Departments; Evaluating the Data and Reporting to BOD; and Capacity Assessment and suggestions to LTK Bank's BOD.

Board of Directors, reporting to the Annual General Assembly composed of shareholder cooperative members initially was searching ways to improve the competitiveness of the Bank by either improving the individual performance of each employee or by replacing them with more equipped staff. The ruling vision was to motivate the employees to upgrade their knowledge in customer relations, more specifically in sales.

Time management was also an issue that BOD believed that needs attention. The management of the Bank faced dilemma; the traditional in house trained and experienced versus University educated bankers when selecting staff to be promoted and or assigned to new departments and divisions.

#### **3.1 Drafting the project with BOD of LTK Bank**

The journey of the bank to Capacity Assessment started with the search for external trainers to provide above up skilling to the staff and to evaluate the performance of the employees. This would justify the BOD's decisions in all staff matters like employment, wages, promotions etc. BOD thus intended to keep up with the increasing competition in the sector by both new local banks and foreign bank branches.

The Capacity Assessment program was suggested by the external evaluators as a method to analyse in more detail the staff and their knowledge and skills in relation with the duties they are assigned. BOD was briefed that they first need to know what the organisation is made of.

#### **3.2 Ensuring the participation of BOD and GM**

Data collected and processed during Capacity Assessment will clearly help to restructure the organisation to a better efficiency by upgrading the knowledge in needed areas and by reshuffling the employees to better matching positions. During the meetings with BOD, also a silent or indirect Capacity Assessment was implemented to the members by bringing to their attention how and what tools capacity assessors use in general. Spiedergram7 helped to

<sup>7</sup> a drawing that shows a summary of facts or ideas, with the main subject in a central circle and the most important facts on lines drawn out from it, used invarious spheres of assessment, evaluation and planning

Capacity Assessments for Improving Corporate Efficiency –

*and availability from specific people* (Shamugia, 2008).

Europe, and Japan9.

corporate uniform?"...

%20this %20tool.html

position and future expectations.

Case of Limassol Turkish Cooperative Bank in Northern Cyprus 35

Germany, Switzerland, and Austria finds that 26% of firms use Balanced Scorecards. The widest use of the Balanced Scorecard approach can be found in the US, the UK, Northern

Even though this process looked like a preparatory stage, the training was already on and the preparations for Capacity Assessment were triggering the employees to improve their knowledge and various skills like effective communication and teamwork. The questioner as shown in Table 1 contained a total of 42 capabilities reflecting corporate value, work attitude, communication, leadership, team spirit, customer relations, marketing, and crises handling etc. The questioner provided possibility to cross check statements of employees by forwarding to all, questions like "who are the usual early birds?", "who are the social event fans?", "who do you work with greatest pleasure?","who is strictly affiliated to the

The questioner also included criteria to evaluate the overall emotional situation of the employee, matters like household issues affecting them, distance of residence and travel means and times. The questioner additionally provided section for **"Destination Statement"**10 to encourage the employees to express their comments on their current

At this stage, the participants were briefed for Capacity Assessment methodologies and the use of Balanced Scorecard. Participants evaluated three generations of Balanced Scorecard practise and for initial Capacity Assessment agreed on a general format respecting the basics (The 4 box system in grading) and current achievements in using Balanced Scorecard.

A grading system 1-4 was built in the Balanced Scorecard where, Capacity graded as 1 needs urgent improvement, Capacity graded 2 is improvable, Capacity graded 3 is

The Balanced Scorecard included a third generation feature; section for the assessed to define their own targets in improvement with times for such stated. Definition Statement concept was thus introduced to the assessed to contribute also to their evolvement for Self

*During the 10 years since the advent of Balanced Scorecard, many changes have been made to the physical design, utility and the design processes used to create the tool within organisations. This evolution of Balanced Scorecard, at least in terms of these three parameters, can be largely attributed to empirical evidence driven primarily by observed weaknesses in the design process* 

9 http://www.ap-institute.com/ Balanced %20Scorecard %20How %20many %20companies %20use

10 Destination Statement is an improvement used in 3rd generation balanced scorecards

improving to satisfaction, and Capacity graded 4 is efficiently improved.

Assessment in future Performance Evaluation programs.

*A process with no real management commitment will be compromised from the start. As important as senior management's commitment is, it is important to have the full support of the individuals in middle management or front line supervision whose support, or lack thereof, can make or break the process, hence, prior to the assessment, a steering team (from both sides) comes together to agree the plan, clarify objectives and commit their organization, team or group to support the assessment process. The senior decision-makers of relevant organization then need to foster support and leverage resources within their own organization or team, e.g. dedicated time* 

clear the confusion amongst the members of board for participating and contributing to the Capacity Assessment program. The board members agreed to build up the relations with the organisation by first strengthening the nucleus of the organisation (BOD and GM in the case) and continuously working the way to middle (middle management; Department Heads, Branch Managers) and outer (first level employees) spheres of the net.

Demonstration with a healthy onion and a semi rotten onion also projected more than the necessary clues to define that only around strong core structure healthy layers can be built where a decaying core will only add other decoyed layers creating an overall unhealthy product. Apple's marketing, at its "core", is more like an onion. Separate, individual layers that all come together to create the whole picture. At every stage of a product's development or marketing, there is input, evaluation, and ideas. Don't think of Apple as having a single "marketing department" that controls all its advertising and design, rather, the whole company, and its customers, are the marketing department.8

#### **3.3 Briefing the staff and motivating them for professional participation and contribution**

Up to the date when the employees were introduced to a complex program of Capacity Assessment, only some of them had attended to mostly single day conferences and trainings. Introductions were done in three groups of average 50 people and special attention was paid that each group consists of employees from all levels. Reluctant to attend top management were given the task to organise and lead the meetings to ensure their participation. Capacity Assessment specialists supervised the meetings and to overcome the major concern and confusion of the participants in "how the result of the program will affect them individually", the employees were encouraged to work on the individual and corporate benefits and challenges that might arise from the implementation of Capacity Assessment. Some definitions of capacity cited above were shared with and the staff.

#### **3.4 Drawing the questioner with key participants and forming the Balanced Scorecard**

A questioner was produced with extensive contribution of 35 employees from different hierarchies including representation from BOD, GM, and various departments and branches.BOD was presented the questioner to ensure everyone's involvement and approval on the questions selected. BOD approved and confirmed the use of the questioner as it was drafted.

The Balanced Scorecard (BSC) is a strategic performance management framework that allows organizations to manage and measure the delivery of their strategy. The concept was initially introduced by Robert Kaplan and David Norton in a Harvard Business Review Article in 1992 and has since then been voted one of the most influential business ideas of the past 75 years (Kaplan and Norton, 1992).

About half of major companies in the US, Europe and Asia are using Balanced Scorecard Approaches. The exact figures vary slightly but the Gartner Group suggests that over 50% of large US firms had adopted the BSC by the end of 2000. A study by Bain & Co finds that about 44% of organizations in North America use the Balanced Scorecard and a study in

 8 Sherice Jacob http://blog.kissmetrics.com/how-apple-changed-the-world/

clear the confusion amongst the members of board for participating and contributing to the Capacity Assessment program. The board members agreed to build up the relations with the organisation by first strengthening the nucleus of the organisation (BOD and GM in the case) and continuously working the way to middle (middle management; Department

Demonstration with a healthy onion and a semi rotten onion also projected more than the necessary clues to define that only around strong core structure healthy layers can be built where a decaying core will only add other decoyed layers creating an overall unhealthy product. Apple's marketing, at its "core", is more like an onion. Separate, individual layers that all come together to create the whole picture. At every stage of a product's development or marketing, there is input, evaluation, and ideas. Don't think of Apple as having a single "marketing department" that controls all its advertising and design, rather, the whole

Up to the date when the employees were introduced to a complex program of Capacity Assessment, only some of them had attended to mostly single day conferences and trainings. Introductions were done in three groups of average 50 people and special attention was paid that each group consists of employees from all levels. Reluctant to attend top management were given the task to organise and lead the meetings to ensure their participation. Capacity Assessment specialists supervised the meetings and to overcome the major concern and confusion of the participants in "how the result of the program will affect them individually", the employees were encouraged to work on the individual and corporate benefits and challenges that might arise from the implementation of Capacity

Heads, Branch Managers) and outer (first level employees) spheres of the net.

**3.3 Briefing the staff and motivating them for professional participation and** 

Assessment. Some definitions of capacity cited above were shared with and the staff.

**3.4 Drawing the questioner with key participants and forming the Balanced Scorecard**  A questioner was produced with extensive contribution of 35 employees from different hierarchies including representation from BOD, GM, and various departments and branches.BOD was presented the questioner to ensure everyone's involvement and approval on the questions selected. BOD approved and confirmed the use of the questioner

The Balanced Scorecard (BSC) is a strategic performance management framework that allows organizations to manage and measure the delivery of their strategy. The concept was initially introduced by Robert Kaplan and David Norton in a Harvard Business Review Article in 1992 and has since then been voted one of the most influential business ideas of

About half of major companies in the US, Europe and Asia are using Balanced Scorecard Approaches. The exact figures vary slightly but the Gartner Group suggests that over 50% of large US firms had adopted the BSC by the end of 2000. A study by Bain & Co finds that about 44% of organizations in North America use the Balanced Scorecard and a study in

8 Sherice Jacob http://blog.kissmetrics.com/how-apple-changed-the-world/

company, and its customers, are the marketing department.8

**contribution** 

as it was drafted.

the past 75 years (Kaplan and Norton, 1992).

Germany, Switzerland, and Austria finds that 26% of firms use Balanced Scorecards. The widest use of the Balanced Scorecard approach can be found in the US, the UK, Northern Europe, and Japan9.

*A process with no real management commitment will be compromised from the start. As important as senior management's commitment is, it is important to have the full support of the individuals in middle management or front line supervision whose support, or lack thereof, can make or break the process, hence, prior to the assessment, a steering team (from both sides) comes together to agree the plan, clarify objectives and commit their organization, team or group to support the assessment process. The senior decision-makers of relevant organization then need to foster support and leverage resources within their own organization or team, e.g. dedicated time and availability from specific people* (Shamugia, 2008).

Even though this process looked like a preparatory stage, the training was already on and the preparations for Capacity Assessment were triggering the employees to improve their knowledge and various skills like effective communication and teamwork. The questioner as shown in Table 1 contained a total of 42 capabilities reflecting corporate value, work attitude, communication, leadership, team spirit, customer relations, marketing, and crises handling etc. The questioner provided possibility to cross check statements of employees by forwarding to all, questions like "who are the usual early birds?", "who are the social event fans?", "who do you work with greatest pleasure?","who is strictly affiliated to the corporate uniform?"...

The questioner also included criteria to evaluate the overall emotional situation of the employee, matters like household issues affecting them, distance of residence and travel means and times. The questioner additionally provided section for **"Destination Statement"**10 to encourage the employees to express their comments on their current position and future expectations.

At this stage, the participants were briefed for Capacity Assessment methodologies and the use of Balanced Scorecard. Participants evaluated three generations of Balanced Scorecard practise and for initial Capacity Assessment agreed on a general format respecting the basics (The 4 box system in grading) and current achievements in using Balanced Scorecard.

A grading system 1-4 was built in the Balanced Scorecard where, Capacity graded as 1 needs urgent improvement, Capacity graded 2 is improvable, Capacity graded 3 is improving to satisfaction, and Capacity graded 4 is efficiently improved.

The Balanced Scorecard included a third generation feature; section for the assessed to define their own targets in improvement with times for such stated. Definition Statement concept was thus introduced to the assessed to contribute also to their evolvement for Self Assessment in future Performance Evaluation programs.

*During the 10 years since the advent of Balanced Scorecard, many changes have been made to the physical design, utility and the design processes used to create the tool within organisations. This evolution of Balanced Scorecard, at least in terms of these three parameters, can be largely attributed to empirical evidence driven primarily by observed weaknesses in the design process* 

<sup>9</sup> http://www.ap-institute.com/ Balanced %20Scorecard %20How %20many %20companies %20use %20this %20tool.html

<sup>10</sup> Destination Statement is an improvement used in 3rd generation balanced scorecards

Capacity Assessments for Improving Corporate Efficiency –

30)The number of staff working under the control of

37)Last branch or department meeting attended

1) Number of employed family members living

2) Number of dependant family members living

4) Transport means to and from the work

6) Weekly or periodical sports activities

Destination Statement of the employee

Table 1. Capacity Assessment Scorecard

he is absent

36)Reporting to

manager

together

together

32)Overall concerns when absent 33)Strains in the absence of his staff

41)Foreign languages spoken

3) Distance of the residence

5) Social weekly activities

Suggestions of the employee

31)Main concerns about the performance of his subordinates when

40)How does he analyze the problems in the absence of the branch

Case of Limassol Turkish Cooperative Bank in Northern Cyprus 37

25)Compliance with the teamwork skills 26)The ability to motivate his teammates 27)Leadership and management skills 28)Presentation capabilities 29)Relations with subordinates

34)Ability to solve staff matters on his own 35)Reporting frequency of staff matters to the management

38)Solve his own individual problems 39) Referring the individual problems to the administrator

42)The level of foreign languages spoken

External factors effecting the emotional condition of the employee and Destination Statement

Name of the Assessor:\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_ Date of Assessment:\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_

*rather than in the architecture of the original idea. The need to have a design process that made measure selection more relevant and part of the collective view of the management team drove the major changes that can be seen in two subsequent generations of Balanced Scorecard from the original concept. However, while empirical developments were the mainstay of the evolution of Balanced Scorecard certain aspects of the evolution rationale can be paralleled to pre-existing academic philosophies relating to organisational management and strategic thinking. The* 


CAPABILITIES 1 2 3 4

1) The knowledge about the Bank products (credit types etc.) 2)Observation and ability to understand customer need

6)Communications skills 7)The quality of service provided 8)Average processing times for primary operations 9)Communications with colleagues

11)Trainings attended for dealing with problematic customers 12) Trainings attended for solving customer problems

15) Reporting skills for unresolved problems authority 16)Corporate Dress attire 17)Punctuality and regularity 18)The frequency of sick leave and other excuses 19)Participations in development programmes 20)Flexibility and adaptability to development skills 21)Learning skills 22)Skills, abilities and activities except the job

3) Understanding the Customer needs and matching them with

5)The ability to offer new products to existing and new customer

10)Ability to communicate with customers with exaggerated

13) Pre-detection capability for ,risk, complications

23)Knowledge in the bank's policies and practices 24)Ability to comply with the Bank's and practices for

14) The ability to deal with and resolve the

problem/risk/complication

4)The ability to offer innovative recommendations

NAME SURNAME BRANCH TITLE POSITION

WORK START DATE EDUCATION STATUS PARTICIPATIONS IN TRAINING PROGRAMS

bank policies.

(up selling skills)

expectations

compliances


Name of the Assessor:\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_ Date of Assessment:\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_

#### Table 1. Capacity Assessment Scorecard

*rather than in the architecture of the original idea. The need to have a design process that made measure selection more relevant and part of the collective view of the management team drove the major changes that can be seen in two subsequent generations of Balanced Scorecard from the original concept. However, while empirical developments were the mainstay of the evolution of Balanced Scorecard certain aspects of the evolution rationale can be paralleled to pre-existing academic philosophies relating to organisational management and strategic thinking. The* 

Capacity Assessments for Improving Corporate Efficiency –

**3.7 Evaluating the data and reporting to BOD** 

**3.7.1 Capacity evaluation for each staff** 

psychological needs if any.

**department where they work** 

**Branch Employee** 

**Name**<sup>12</sup>

graded and composed during the interviews

assessed for building further capabilities.

Main Branch A.A Leadership, Management Skills

Main Branch AU Possesses teaching skills to be

Main Branch ED Will be more efficient if relocated to accountancy dept

advised.

Main Branch ÇH Effective Communication and

Main Branch SA Leadership, Marketing courses advised

courses advised

trained as in-house trainer. Leadership and advanced communication skills courses

Accounting courses advised

SCA as Scorecard Average can be calculated as "between 00 and 1.0 (needs urgent improvement)", "between 1.1 and 2.0 (improvable)", "between 2.1 and 3.0 (improving to

Table 2. Report for Employees' Capacity Evaluation (Main Branch)

satisfaction)" and "between 3.1 and 4.0 (efficiently improved)".

12 Full names not reproduced for ethical reasons and privacy respect

Case of Limassol Turkish Cooperative Bank in Northern Cyprus 39

Capacity Assessment for each employee was evaluated based on the Balanced Scorecard

i. **Numerical Evaluation**. The sum of grades (marked 1-4) for each capability, divided to the number of capabilities assessed on the scorecard produces the overall Average

ii. **Comments of Capacity Assessor**. Indicates the leadership, communication, sales and other capacities observed, suggests additional training in appropriate disciplines and eventual new job position. Comments about the motivation level and points to

iii. **Own comments of the assessed**. Commitments and Destination Statement of the

**3.7.2 Sample of report for Employees' Capacity Evaluation grouped in the branch or** 

As a result, a table was produced for each branch and or department listing every employee and evaluations derived from the collected data. The Table 2 is just a short part of the full table, which was composed for the employees of The Nicosia Main Branch, in Nicosia with total 24 employees. The sample table displays only 5 randomly selected employees. The table clearly exposes the numerical (Scorecard Average) and comments of Capacity Assessor.

**SCA Capacity Level Position** 

1.8 improvable, Starter level

Assistant to Branch Manager

Starter level clerk

Intermediate level clerk

clerk

Branch Vice Manager

2.5 Improving to Satisfaction

2.2 Improving to Satisfaction

3.3 Efficiently improved.

3.6 Efficiently improved.

**Capacity Assessors' Comments for further improvement areas** 

Capacity grade of each employee. Scorecard Average (SCA) is thus derived

*alignment between developments in Balanced Scorecard principles and the theoretical aspects of control and management process are a positive indication that the more modern ideas about Balanced Scorecard design processes and structure are indeed 'better' than the original concept described by Kaplan and Norton, in so far as they are more likely to have a beneficial consequence for the organisation adopting the tool. However, while more recent Balanced Scorecard designs are substantial improvements on original ideas; there is still room for improvement.*<sup>11</sup>

#### **3.5 Interviews for individual capacity assessments**

Interviews to assess the personal capacity were conducted at the branch or department of the employee. Appointments were set in advance and the employees were well informed about the date and time of their assessment interview. Participants' workload and engagements were considered when appointments were set. Holiday and sick leave and other excused were respected and the interviews were arranged to accommodate these.

 At the beginning, the two interviewers executed the interviews together. Bank branch with 1 branch manager, 2 assistant managers, and 12 employees of different positions were interviewed. By working together, the two interviewers ensured to use similar scale indicators when grading the employees, who were evaluated by the interviewers, later working each on his own with the interviewed.

Interviews took place in private and no ordinates or subordinates were present at any employee's interview. The interviewers paid attention to the comfort of the employees and tried to gain the trust of employees in the process by implementing the principal that all comments stay confidential except for the final grade and outcomes like suggestions for additional skill trainings and relocating of departments and or branches (See table 1 for a sample).

 Duration of interviews depended on various criteria like the range of responsibilities of the employee, willingness of the employee to comment and offer ideas and suggestions for improvement. Most interviews completed in 30-45 minutes. As the interviews progressed, the initial strain and stress signs of the employees decreased significantly. The team sprit evolved and more suggestions and critics increased the data collection.

#### **3.6 Physical and management capacity assessment of branches and departments**

Work environment has always been a decisive factor on performance of the employees. The Capacity Assessment Team evaluated every Branch and Department during the assessment visits. The physical capacity of the premise was evaluated by observation to define multiple criteria like; Building and work area's ergonomic and corporate design, Efficiency in traffic in the work and customer service areas, Display of information, Existence of employee service and recreational areas, Hospitality desk or area for Customer, Equipment standards and appropriate use, and Parking spaces for staff and customers. We will observe later in this chapter a sample report evaluating the physical and operational capacities of a branch (See Iskele Branch as a sample).

<sup>11</sup> Ian Cobbold and Gavin Lawrie The Development of BSC as a Strategic Management tool, 2GC Limited, 2001, 2003.

## **3.7 Evaluating the data and reporting to BOD**

#### **3.7.1 Capacity evaluation for each staff**

38 Business Dynamics in the 21st Century

Interviews to assess the personal capacity were conducted at the branch or department of the employee. Appointments were set in advance and the employees were well informed about the date and time of their assessment interview. Participants' workload and engagements were considered when appointments were set. Holiday and sick leave and other excused were respected and the interviews were arranged to accommodate these.

 At the beginning, the two interviewers executed the interviews together. Bank branch with 1 branch manager, 2 assistant managers, and 12 employees of different positions were interviewed. By working together, the two interviewers ensured to use similar scale indicators when grading the employees, who were evaluated by the interviewers, later

Interviews took place in private and no ordinates or subordinates were present at any employee's interview. The interviewers paid attention to the comfort of the employees and tried to gain the trust of employees in the process by implementing the principal that all comments stay confidential except for the final grade and outcomes like suggestions for additional skill trainings and relocating of departments and or branches (See table 1 for a

 Duration of interviews depended on various criteria like the range of responsibilities of the employee, willingness of the employee to comment and offer ideas and suggestions for improvement. Most interviews completed in 30-45 minutes. As the interviews progressed, the initial strain and stress signs of the employees decreased significantly. The team sprit

**3.6 Physical and management capacity assessment of branches and departments** 

Work environment has always been a decisive factor on performance of the employees. The Capacity Assessment Team evaluated every Branch and Department during the assessment visits. The physical capacity of the premise was evaluated by observation to define multiple criteria like; Building and work area's ergonomic and corporate design, Efficiency in traffic in the work and customer service areas, Display of information, Existence of employee service and recreational areas, Hospitality desk or area for Customer, Equipment standards and appropriate use, and Parking spaces for staff and customers. We will observe later in this chapter a sample report evaluating the physical and operational capacities of a branch

11 Ian Cobbold and Gavin Lawrie The Development of BSC as a Strategic Management tool, 2GC

evolved and more suggestions and critics increased the data collection.

*improvement.*<sup>11</sup>

sample).

(See Iskele Branch as a sample).

Limited, 2001, 2003.

**3.5 Interviews for individual capacity assessments** 

working each on his own with the interviewed.

*alignment between developments in Balanced Scorecard principles and the theoretical aspects of control and management process are a positive indication that the more modern ideas about Balanced Scorecard design processes and structure are indeed 'better' than the original concept described by Kaplan and Norton, in so far as they are more likely to have a beneficial consequence for the organisation adopting the tool. However, while more recent Balanced Scorecard designs are substantial improvements on original ideas; there is still room for* 

Capacity Assessment for each employee was evaluated based on the Balanced Scorecard graded and composed during the interviews


#### **3.7.2 Sample of report for Employees' Capacity Evaluation grouped in the branch or department where they work**

As a result, a table was produced for each branch and or department listing every employee and evaluations derived from the collected data. The Table 2 is just a short part of the full table, which was composed for the employees of The Nicosia Main Branch, in Nicosia with total 24 employees. The sample table displays only 5 randomly selected employees. The table clearly exposes the numerical (Scorecard Average) and comments of Capacity Assessor.


Table 2. Report for Employees' Capacity Evaluation (Main Branch)

SCA as Scorecard Average can be calculated as "between 00 and 1.0 (needs urgent improvement)", "between 1.1 and 2.0 (improvable)", "between 2.1 and 3.0 (improving to satisfaction)" and "between 3.1 and 4.0 (efficiently improved)".

<sup>12</sup> Full names not reproduced for ethical reasons and privacy respect

Capacity Assessments for Improving Corporate Efficiency –

and encourages applicant and new employees.

**3.8.2 capacities needing urgent attention for improvements** 

Regulations are unknown, except by a minor group. Complete restructuring of Human Resources unit is needed.

improve their supportive attitude to the employees.

Hierarchical structure within the bank must be respected.

Branches must project the corporate design and identity.

Access and facilities for disabled must be present and or improved.

Marketing is the capacity, which needs immediate improvement.

internet connection) should be designed for all branches.

of branches and departments are not present.

instead of 'I' should be preferred.

trained and energetic staff.

and services offered.

university campuses.

needs to be identified and developed.

Bank employees posses highest level of institutional loyalty

**3.8.1 Advanced capacities** 

exit entry card system!)

the bank's products.

self-confidence.

Case of Limassol Turkish Cooperative Bank in Northern Cyprus 41

Work departure / arrival times are in general satisfactory. (Solution to this issue; use

 The employees (especially employees with more than 10 years in the bank) demonstrate high level of communication skills, attention, and are active and diligent in introducing

Significantly high employment continuity helps to keep and improve customer loyalty

 The easy accessibility of senior management even though occasionally disturbs the hierarchical scheme; employees often enjoy the practice and develop higher level of

 A satisfactory number of employees in each branch and department are well acquainted with the customers and possess skills to satisfy individual needs of the customers. Solidarity and support among the staff is present at a high and admirable level. This positively affects the performance of the bank and the team work of the employees. Board of Directors' job, responsibility, and authority sharing strategy is a major advantage for the bank. This innovative way of management in North Cyprus banks is increasing each BOD member's specialization and effective and efficient management.

Periodic meetings are not regular .The meetings, the agenda and the minutes / reports

Bank's regulations are neither well distributed nor well recognised by the employees.

Level of staff motivation needs to be increased. In particular, branch managers need to

Individual achievements should not be in front of corporate success. Especially 'We'

Marketing Department needs to be restructured as quickly as possible, with well-

Unique to each region-specific marketing campaign. Credit expansion of the region's

Closed circuit TV screens (LCD), in each branch can be used to promote the products

Customer preparatory desk (pens, forms, calculators, product brochures, and even an

 Customer profile is aging. Aim for a young customer profile. Note that young people are future customers. Especially important in this sense are marketing points at the

Develop relationships with State and local government agencies and institutions in regions.

#### **3.7.3 Physical and operational capacities**

The Capacity Assessors also observed each branch and department visited for Physical and Operational Capacities. The Data collected for these capacities of each branch, was analysed and reported to BOD.

A Physical and Operational Capacities report based on the real report for one branch (Iskele Branch) is partially sampled below. Only the capacities, which need improvement, are summarised and included in this sample.

Iskele Branch is in a relatively distant town (fishing, tourism, agriculture) from the main office. The Branch has 14 employees including the Manager and 2 Shift Leaders. **Average Score of the Iskele Branch is calculated as 2.63.** The Average Score of the Branch is the figure derived from dividing the sum of all employees' Scorecard Average to the number of employees.

#### **Physical Capacities of Iskele Branch, which need improvement, are stated below:**


#### **Operational Capacities Iskele Branch, which need improvement are as follows:**


#### **3.8 Reporting and suggestions to LTK Bank's BOD**

The Capacity Assessment Team provided to the BOD with the following reports and presentations:


Following is an extract from the General Report presented to BOD of LTK Bank. The main findings of report are categorised as advanced capacities of LTK band and Capacities of the bank needing urgent attention for improvements.

#### **3.8.1 Advanced capacities**

40 Business Dynamics in the 21st Century

The Capacity Assessors also observed each branch and department visited for Physical and Operational Capacities. The Data collected for these capacities of each branch, was analysed

A Physical and Operational Capacities report based on the real report for one branch (Iskele Branch) is partially sampled below. Only the capacities, which need improvement, are

Iskele Branch is in a relatively distant town (fishing, tourism, agriculture) from the main office. The Branch has 14 employees including the Manager and 2 Shift Leaders. **Average Score of the Iskele Branch is calculated as 2.63.** The Average Score of the Branch is the figure derived from dividing the sum of all employees' Scorecard Average to the number of employees. **Physical Capacities of Iskele Branch, which need improvement, are stated below:** 

Perfectly located Branch needs architectural reconstruction to reflect the corporate style

 Security of the Branch and the employees is compromised in the current work environment. This elevates the necessity of attention to the reconstruction issue.

New architectural solution must allow space for customer hospitality desk to protect

The character of the rural area demands increased mobility for the branch. Additional

Branch manager to be supported continuously with specific additional trainings to

Products related with the rural character of the area must be included to the product

The Capacity Assessment Team provided to the BOD with the following reports and

Capacity Assessment of employees grouped in the department or branch they are

Physical and Operational Capacity of each branch or department (Sampled above in

 General Report covering all the capacities of the LTK Bank aspects stating both the capacities needing priority for improvement and the capacities improved to satisfaction.

Following is an extract from the General Report presented to BOD of LTK Bank. The main findings of report are categorised as advanced capacities of LTK band and Capacities of the

**Operational Capacities Iskele Branch, which need improvement are as follows:** 

**3.7.3 Physical and operational capacities** 

summarised and included in this sample.

and reported to BOD.

indoor and outdoor.

Equipment needs upgrading.

vehicle must be provided.

range

presentations:

the existing friendly work relations with locals

**3.8 Reporting and suggestions to LTK Bank's BOD** 

positioned (sampled above in table 2).

bank needing urgent attention for improvements.

Iskele Branch case; 3.7.3).

Strong local relations must be capitalised for further growth

improve to satisfaction his organisational and leadership skills.


#### **3.8.2 capacities needing urgent attention for improvements**


Capacity Assessments for Improving Corporate Efficiency –

observed just after the implementation of the program.

bank or the leading methods of the nearest administrator.

transparent quality to the recruitment policies of the LTK Bank.

**4. Conclusion** 

responsibility programs.

Performance Evaluation

Case of Limassol Turkish Cooperative Bank in Northern Cyprus 43

Evaluation under loose supervision of The Capacity Assessment Team. The results were supporting the necessity of trainings and programs provided and justifying the suggestions

In this study, capacity assessment program was applied to Limassol Turkish Cooperative Bank in Northern Cyprus. Expectedly, positive contributions of this program started to be

LTK Bank in less than a year gained a well-dressed corporate identity. Departments were restructured to more efficiency. Total restructure was in Human Resource Department now performing much more than being a pay-roll office. Information Technology Department rise to the level to meet both customer and Bank's needs. A proactive Marketing Department harmonised the existing products and constantly is researching and designing new general and specific to the area products. Young customers are targeted with products offering them solutions for financing their education and or new profession. A small number of staff (6) was relocated to alternative departments. Limited numbers of staff (2) were contributed to improve their emotional well being by professional attention and paid recreational holiday. Two top-level managers and one member of the board enrolled to 8 weeks Executive Bank Management Training.16 new jobs were created in the bank at specialised and starter levels. LTK Bank became more visible with additional social

As in any other Capacity Development program, the method used during this study lacked the capability of bringing to surface some of the significant human factors in any operation. There were no tested tools to understand if the mature staff who occupy executive positions are more interested in their retirement plans or the strategic improvement of the of the organisation in next 10 years. Likewise, we could not verify how devoted is the junior employees to the Bank. The program provided too little information for the assessors to trace or to link the psychological discomforts (if any) with the management styles of the

Without a comprehensive Capacity Assessment, LTK Bank could still be wondering how to meet the new challenges. The implemented Capacity Assessment gave the opportunity to the Bank to learn *'what their staffs are made from'*. This knowledge was much easier to obtain and more economic than costly new management and new staff contracts. It also improved the positive image amongst stakeholders as an institute who cares and contributes to existing employees rather than terminating their contracts. It also provides a fair and

The program will lay strong foundations to the organisation's further Capacity Development. Education and Training provided must be tested for outcome. Biannual Performance Evaluations performed by trained corporate in-house assessors must be crosschecked with external expert assessors until the derivations in the results are diminishingly narrow. Researches among close stakeholders (Cooperative member

14 Another study of the authors' will detail the improvement program and training and conducting

made to BOD in the General Report of the Capacity Assessment Team14.


#### **3.9 Summary of trainings as an outcome of the capacity assessment program**

Education and Trainings; Communication Skills verbal and written, Presentation skills, Ethics and Banking Ethics, Leadership, Crises Management, Advanced English Language, Report Writing skills of staff were improved by providing education and training programs to the employees in harmony with the outcome of Capacity Assessment.

A group of 30 employees were trained on Performance Evaluation and Methods, Objective Evaluations, Interview skills, this group drafted the Performance Evaluation Balanced Scorecard majorly applying the 360-Degree Methodology13. 8 of this group were appointed as in-house Performance Evaluators and after practising, they conducted Performance

<sup>13</sup> The performance feedback method known as 360-degree feedback has gained wide popularity in the corporate world to the point of being nearly universal among Fortune 500 companies. A 360-degree feedback program enables organizational members to receive feedback on their performance, usually anonymously, from all the major constituencies they serve. (Jai Ghorpade Managing Five Paradoxes of 360-Degree Feedback. Academy of Management Feb., 2000

Evaluation under loose supervision of The Capacity Assessment Team. The results were supporting the necessity of trainings and programs provided and justifying the suggestions made to BOD in the General Report of the Capacity Assessment Team14.

## **4. Conclusion**

42 Business Dynamics in the 21st Century

 Improve communication with Main Office by using online IT software to find earlier solutions to special customer demands such as insurances, special credits etc. Marketing Department at the Main Office must consider regional marketing needs and

Hospitality Desk (The concept of hospitality) as a pilot study in a small branch must

 Risk management is a very urgent need and priority should be the establishment of a new department as soon as possible. At the present, the individuals assigned to this task lack the knowledge and experience. Expert service must be outsourced to save time

Contemporary banking technologies need to be available in all branches and not only in

 Compliance with existing regulations of dress is generally observed. However, the colours used are incompatible with the vision of the bank. Black represents the colour of

The senior management is selectively far too easily accessible and this creates hierarchic

Personal Banking must be introduced to create an upper hand in competition with

 Branches need to have meeting rooms to provide service that is more efficient to the customers. The current practice of inviting the customers behind the service bench is outdated and projects selective servicing of some customers while carries risk for

Cleaning and maintenance done by bank staff is not at the expected highest level.

Education and Trainings; Communication Skills verbal and written, Presentation skills, Ethics and Banking Ethics, Leadership, Crises Management, Advanced English Language, Report Writing skills of staff were improved by providing education and training programs

A group of 30 employees were trained on Performance Evaluation and Methods, Objective Evaluations, Interview skills, this group drafted the Performance Evaluation Balanced Scorecard majorly applying the 360-Degree Methodology13. 8 of this group were appointed as in-house Performance Evaluators and after practising, they conducted Performance

13 The performance feedback method known as 360-degree feedback has gained wide popularity in the corporate world to the point of being nearly universal among Fortune 500 companies. A 360-degree feedback program enables organizational members to receive feedback on their performance, usually anonymously, from all the major constituencies they serve. (Jai Ghorpade Managing Five Paradoxes of

 Marketing products offered by the bank should not be competing with each other. In some branches, the bank asks for customer's password when providing service related with Debit cards. These practices have to be abandoned immediately since it

**3.9 Summary of trainings as an outcome of the capacity assessment program** 

to the employees in harmony with the outcome of Capacity Assessment.

Internet banking and customer service must be introduced with no delay.

disorders of communication between administrative staff.

provide solutions and support.

also be tested in a larger branch.

and avoid legal strains.

authority and seriousness.

confidential data to be exposed

may lead to security and legal drawbacks.

360-Degree Feedback. Academy of Management Feb., 2000

Outsourcing these services will bring more efficiency.

the new ones.

other banks.

In this study, capacity assessment program was applied to Limassol Turkish Cooperative Bank in Northern Cyprus. Expectedly, positive contributions of this program started to be observed just after the implementation of the program.

LTK Bank in less than a year gained a well-dressed corporate identity. Departments were restructured to more efficiency. Total restructure was in Human Resource Department now performing much more than being a pay-roll office. Information Technology Department rise to the level to meet both customer and Bank's needs. A proactive Marketing Department harmonised the existing products and constantly is researching and designing new general and specific to the area products. Young customers are targeted with products offering them solutions for financing their education and or new profession. A small number of staff (6) was relocated to alternative departments. Limited numbers of staff (2) were contributed to improve their emotional well being by professional attention and paid recreational holiday. Two top-level managers and one member of the board enrolled to 8 weeks Executive Bank Management Training.16 new jobs were created in the bank at specialised and starter levels. LTK Bank became more visible with additional social responsibility programs.

As in any other Capacity Development program, the method used during this study lacked the capability of bringing to surface some of the significant human factors in any operation. There were no tested tools to understand if the mature staff who occupy executive positions are more interested in their retirement plans or the strategic improvement of the of the organisation in next 10 years. Likewise, we could not verify how devoted is the junior employees to the Bank. The program provided too little information for the assessors to trace or to link the psychological discomforts (if any) with the management styles of the bank or the leading methods of the nearest administrator.

Without a comprehensive Capacity Assessment, LTK Bank could still be wondering how to meet the new challenges. The implemented Capacity Assessment gave the opportunity to the Bank to learn *'what their staffs are made from'*. This knowledge was much easier to obtain and more economic than costly new management and new staff contracts. It also improved the positive image amongst stakeholders as an institute who cares and contributes to existing employees rather than terminating their contracts. It also provides a fair and transparent quality to the recruitment policies of the LTK Bank.

The program will lay strong foundations to the organisation's further Capacity Development. Education and Training provided must be tested for outcome. Biannual Performance Evaluations performed by trained corporate in-house assessors must be crosschecked with external expert assessors until the derivations in the results are diminishingly narrow. Researches among close stakeholders (Cooperative member

 14 Another study of the authors' will detail the improvement program and training and conducting Performance Evaluation

**3** 

Alain Lepage

*France* 

**Sustainability and Quality of** 

**Life Modeling the Complexity of Governance** 

The Quality of Life index is a well known measurement schedule able to compare the citizen's life facilities across countries of the world. It is based on rational and factual parameters such as Gross National Product, per citizen health spend and gender equity. The criteria has to be be reinforced by psychological approaches like those used in customer satisfaction and Total Quality Management. My studies validate the theoretical role of QoL as attribute of sustainability. I have represented this concept with Makovian reverse

I studied the different attributes of the Quality of Life in a first approach from the research literature, elaborating a structure of these elements. In a second approach, I made interviews of citizens about their Quality of Life perception, with the "voice of the customer" method (Kano [1] , Griffin – Hauser [2]). A validation came also from companies with studies of

The presentation of these previous works concludes showing confusions between Quality of Life, well being, health, happiness, liberty. Then come the effects analysis in the sustainability and the policy definitions with the place of sustainability and safety in

The impact of Quality of Life's variability perception in the instability of political systems drive politicians to better understand sustainability and safety processes functioning. Its useful for politicians to improve the political system and avoid to provide short term answers to citizen's unsatisfactions with a lack of mastery. So I understood that the analogy was relevant in management applications in firm's governance, driving this research to focus on the enterprise analysis in the second half of the document. Observing technology and industry history conducts us to describe the effects of growing complexity in these organizations. My presentation will observe the limitations of the ancient linear models and proposes the analysis and the opportunity of cross reverse differential ones such as Markov. These works conduct towards a partial study of interfaces with human beings and suggest producing simplifications by aggregation method and Markov model describing Quality of

customer needs and expectations, particilarly in the health field.

political systems, allowing us to use a Markov model description [3].

Life's place in sustainability and complexity of governance.

**1. Introduction** 

processes in political systems.

*University of Technology of Compiègne (U.T.C.), COSTECH Laboratory,* 

*Centre Pierre Guillaumat, BP 60319, 60203 Compiègne Cedex* 

shareholders, customers, targeted sectors, related institutions such as Central Bank and Finance Ministry) and general stakeholders need to be carried out for both verifying and extending the level of capabilities and newly acquired capacities of the Bank.

#### **5. Acknowledgment**


#### **6. References**

