Chapter I Introduction

Chapter I Introduction1.1. Purpose & relevance of the study

If we consider the history and development of human resources in the last 10-15 years we see a dynamic map. It developed from the simple management of "people in a complex concept that can be the critical success factor in managing the human capital of each company. We think of several things: from simple individual development training plans and long term talent management, the administration of personnel files on performance management, from recruitment to employment (even more: " Marketing Personnel "). Such developments can be observed HR function in large companies across Europe, in fact, all over the world - but where does HR in Romania? Since we wanted to find out which is the picture of the modern HR, we focused attention on larger organizations. Based on this assumption, our study was that the most important target segment medium and large companies in Romania. We chose this target group because of the variety (expected) HR processes that implemented in large companies, which allowed us to compare the results better and to get a clearer picture of where human resources are in Romania.The study was conducted during the economic crisis, in late 2010, and the results were analysed and interpreted in 2011. Our questions were addressed to the senior human resource managers.[footnoteRef:1] [1: A. S. Tsui and L. R. Gomez-Mejia, Evaluating Human Resource Effectiveness, in Human Resource Management: Evolving Rules and Responsibilities, ed. L. Dyer (Washington, DC: BNA Books, 1988);]

Of the 200 companies invited to participate in the study, 63 companies completed the questionnaire. These companies operate in areas such as energy and utilities, distribution, telecommunications, financial services and other professional services.In short , the study results show the following : development of a modern HR is the most important part of the HR function in Romania; HR is well integrated in the development of corporate strategy and contributes significantly to its implementation; talent management is a top priority for HR; there is a strong desire to HR departments to develop / improve further the career patterns of transparent management systems and skills development programs and management leaders; performance management is widely implemented , but there is plenty of room for improvement; HR function still lacks confirmation from the business on its positioning as a strategic partner . HR has to go through a few steps to be accepted as a business partner.1.2. Research question & design

We shall continue in discussing why human resource management (HRM) decisions are likely to have an important and unique influence on organizational performance. Our hope is that it will help advance research on the link between HRM and organizational performance. We identify key unresolved questions in need of future study and make several suggestions intended to help researchers studying these questions build a more cumulative body of knowledge that will have key implications for both theory and practice.Human resource management in the Romanian banking sector can become a systemic risk and fewer staff can become a macro-prudential risk, if banks are unable to recover imbalances maturities (including in terms of cost). Decreasing the number of employees in the banking sector has been quite steep after 2010. This was equivalent to the loss of useful skills and able to maintain or increase productivity in a short period of time. Comparison must showed that the financial services sector in the economy in 2006 EU27 employ about 5.6 million people (which represent 2.7% of the total number of employees). Useful information about what it meant adjusting the global financial sector is that in the 18 months that lasted the first part of the financial crisis (August 2007 - February 2009) banking fired only 325,000 people, not including the rest of the financial services that are related to the banking sector. In Romania, a country emerging from the EU, the objective necessity to establish and implement a sustainable program to achieve macroeconomic convergence, labour utilization must be considered and treated with balanced measures. " He said that, in general, after the financial crisis, banks have been able to reduce staff while maintaining its portfolio (and then to gradually decrease) by outsourcing (and / or then selling) NPL recovery by specialized companies.The choice resolves non-performing loan portfolio but not in any way help banks return to their core status - that of intermediaries. This means before any customer proximity and better knowledge of it and of their needs, along with a good risk management. How can we speak of a long-term partnership bank client while the client is < tossed > in the arms of recovery in all cases where he cannot financially help recovery? It can also have client trust bank if it took the umbrella from the moment they started the first drops of rain fall?[footnoteRef:2] [2: Brian Becker & Barry Gerhart, The Impact of Human Resource Management on Organizational Performance: Progress and Prospects, Academy of Management Journal, August 1, 1996 vol. 39 no. 4 779-801;]

More on this topic can be found in Chapter 3.

2.1. General model of HRM

The Romanian banking system evolution after 1990 can be identified four main stages of the reform. The first phase of banking reform, (1991-1996) is characterized by two essential elements: adapting Law. 33/1991 on banking and Law no. 34/1991 on the National Bank of Romania ensured banking structure on two levels: develop new functions of the central bank (political monetary , exchange , licensing, regulation , supervision, payment systems ) ; establishment of commercial banks. the adoption of the Government Ordinance no. 39/1996 it has been Deposit Guarantee Fund in the Banking System.The second phase of banking reform, (1997-2000) is characterized by the following features: improve and expand the legal framework in the banking approval of new laws: Law on privatization of banks (Law no. 83/1997) Banking Law (Law no. 58/1998) Bankruptcy Law Banking Law (Law no. 83/1998), Law on the Statute NBR (Law no. 101/1998). creation of the new legislative framework of co-operation of credit ( Government Emergency Ordinance no. 97/2000 , amended by Ordinance no. 272/2000 , amended and approved by Law no. 200/2002). primary objective of the central bank at this stage was stability national currency in order to ensure price stability. NBR intervention tools were upgraded by removing old credit lines and introducing targeted open market operations. start the restructuring of the banking system designed to prevent systemic risk, which aimed to improve quality of supervision, the maintenance and strengthening banking system.The third stage of banking reform, (2001-2006) targeted completion harmonization of the legal framework of credit institutions provisions of EU directives and basic principles of Basel Committee on Banking Supervision efficient.In this phase were followed three key objectives:1. adoption of the new Statute of the National Bank of Romania (Law No. 312/2004), which have made a number of new elements: clear definition of the objective of the NBR is price stability, while maintaining stability financial; strengthening the institutional independence of the central bank; prohibiting direct financing of the public sector by central bank; prohibition of privileged access of the public sector financial institutions.2. amending and supplementing the law adopted in the second stage: Law no. 101/1998, Law no. 58/1998 and Law no. 83/1998. 3. adoption of new banking law ( Government Emergency Ordinance No . 99/2006 on credit institutions and capital adequacy approved and amended by Law no. 227/2007 , as amended and supplemented) , which brought the harmonization full legislation on credit institutions EU directives .During 2006, the financial system has evolved favourably leading to deepening financial intermediation and reducing the gap to other EU countries, so the Romanian banking sector has strengthened dominant position in the system. Year 2006 saw also completion of capital account liberalization, which has paved the way stronger integration of national economies into global financial flows. Stage four, begun in 2007, is to strengthen Romanian banking sector towards achieving the provisions set through the National Convergence. According to this document is provided for participation in ERM type II (ERMI) 2012 and the adoption of the euro for 2014. This timetable will be revised according to the statements of representatives of the state due to the manifestation of the international economic crisis and the Romania.In the context of the financial and banking reform, initiated by 1989 coordinates is attractive macro process: inflation rate, stopping demonetization economy and the process of dollarization and neurotisation, improving international reserves the banking system and exchange rate liberalization. All of these measures helped create the legal framework under which menus monetary relations across economies.[footnoteRef:3] [3: Ion Gr. Ionescu, Reform, Organisation and Consolidation of the Romanian Banking System, Annals of the University of Petroani, Economics, 12(1), 2012;]

2.2. Significance of HRM

Banking institutions have an important role in the financial sector, good operating entities and the economy as a whole , so that over time the constituted a permanent establishment of a functioning banking system capable of delivering a wide range of products and services, which meet the requirements of all potential customers , from early signs far bank .This thesis focuses specifically on the banking system as a segment indispensable economic assembly. Given the economic and financial reality, both internationally and domestically, each country default and Romania is interested in creating a solid banking system, which allows an organizational framework developing appropriate financial mechanisms. I chose this topic after impact that it has on the entire banking system economy and given the fact that a market economy cannot function without banks profitable and well consolidated. With the development of economy and improvement of the banking business in Romania has grown exponentially. In the context of the challenges of globalization, European integration process which is equivalent to the Romania's development cannot be achieved without the existence of a functioning banking system, which to face stiff competition from countries around the world. Determinants of Romanian economy - transition, integration, and globalization - offer important opportunities to increase performance from an economic - financial point of view, making additional profits, but also major risks. With the emergence and expansion of crisis, we noticed indications of unsound banking. They highlighted the lack or insufficient to cover certain segments highly volatile capital market, insufficient control of hybrid financial products but and inadequate risk management practices in banks.News of this paper lies in the need for an analysis bank to provide information, arguments and solutions to avoid triggering certain phenomena that lead to the vulnerability of the banking sector.

2.3. Strategy selection of HRM during economic crisis time

Until 1990, the banking system in the former communist countries watched the Soviet model, namely a central bank, which was the main commercial bank and duties and some specialized banks (investment, agriculture and food industry, foreign trade) and houses or savings cooperatives, the latter serving to attract availability of public funds, using then the economy by the central bank.In this context, immediately after the beginning of transition in 1989, the works of Bank of Romania were essential changes. Specifically in December 1990 Romanian banking reform has produced a two-level structural separation system monobank type.a) First National Bank has finalized the presence of the central bank;b ) On the other hand former state banks (Romanian Bank for Foreign Trade Bank Agricultural Investment Bank) based on a decision of the Government, have been converted into commercial banks, state-owned and private domestic , and new statutes approved to them organization and functioning of these banks.The transition from centralized to market economy involved the reorganization of joint-stock banks and their business autonomy, privatization and the emergence of new institutions or foreign banks with local capital.Banking companies, commercial banks in their capacity, should be seen not only that a business but as institutions that have real public character. They should not be characterized solely as companies focused on meeting a particular interest of shareholders and other stakeholders, but also the specialized entities called upon to solve the financial problems of large corporate bank, containing it as legal, and individuals. Currently it can be argued that the overall organizational objective of each commercial bank is to survive the financial and capital structures. To reach this goal, each bank must maximize social utility function and aim to increase its profitability.[footnoteRef:4] [4: Department of Accountancy and Finance Kavala Institute of Technology, Proceedings of the 5th International Conference . The Economies of Balkan and Eastern Europe Countries in the changed World, 2013;]

2.4. Role of HRM in crisis

Romania's EU integration process was an event that marked the work of banking, restructuring the banking system became a necessity to financial support of all economic activities necessary for the reform of the Romanian economy.Restructuring the banking system with regulation, licensing and banking supervision are two of the main issues addressed by the Romanian banking system remodelling ( remodelling banking system aimed at both creating a specific banking market economy and harmonization of Romanian legislation with the EU countries ) .Banks in Romania have reshaped business options and management structures redefining the internal organization of the work from the perspective of customer relationship and its repartitioning according to customer requirements. Changing banking strategies in Romania and their orientation more than the customer, especially large banks that have significant financial capacity shows that it goes in the direction of the banks in developed economies. Financial activities will be separated according to clients, not their intrinsic nature.Clients desire complete financial services package there is a trend of integration of services. Focusing on client- bank relationship, banks are currently interested in business relationships beneficial to both parties. In development strategies bank must know the weather of development of the area in which they operate. Through policy support investment in the region, the bank can be seen as a factor shaping economic process in the area where they operate. In carrying out this function by Romanian banks are for example U.S. banks that are even obliged to participate in development economic zone to maintain their license, but also in some European countries.Restructuring of the Romanian banks in this direction, that is, they support projects business through loans that they can support themselves or ventures with other banks in richer areas must consider the overall economic development.Operational changes is an urgent need for banks in Romania because with integrating them compete for funds, banking companies of the developed countries in the European Union are very powerful and have much experience in the market economic structures .With EU accession Romanian banking system is actively involved in developing projects to modernize the banking system, among these projects and project enrolling in the Single Euro Payments Area, which aims to create a European economy more transparent and competitive.SEPA - Single Euro Payments Area requires that the Euro will not current differentiation between domestic and foreign payments - consumers, retailers and corporations will be able to make payments in the Euro zone as follows: from a single bank account; using a single set of payment instruments; as safe, fast and efficient as in the national context today.SEPA is inevitable, the next stage of European economic integration and introduction of the Euro. SEPA will increase European competition will encourage the consolidation and integration will require innovation.We conclude that a single market and is not complete until payment is unique , so a single bank account and a single set of payment instruments to be able to conduct payment transactions throughout the euro area , as simple and safe as it operates today, nationwide.[footnoteRef:5] [5: Steven Lewis, Making the right moves. Global banking outlook 201213, EYGM Limited, 2012;]

2.4.1. Retaining key employees

Times are hard and complicated we understand less and less. We are increasingly feeling adrift and completely at the discretion of politicians who still reluctant to admit failure of public policies (especially those directly related to monetary policy) and recognize the immense damage caused private market and private capital that production of money from nothing. The pain and despair that more and more out in the street to tell the step " does not announce anything good coming period.What we live today are not an isolated phenomenon and easily removed. It is a series of complications and problems encountered and expanded with the proper science of governing the modern state and the buttons dangerously choose to interfere with private property. The only guilty of this crisis is state intervention in the capital market , monopoly money and confusion evident that interventionists do to Keynes here between the money (made from scratch and a cost far below that of a roll of toilet paper ) and capital ( only result from a process of abstaining from present consumption of goods and services).State and not the free market created and then defended a number of privileges for the banking sector that has developed and perverted the image and likeness:Fractional reserve: a privilege that banks cheating depositors who deposit money in bank accounts sight. Bankers , seeing how important funds are held by depositors in their current accounts were thought how useful it would be to put them in motion ( most often in their profit and the state which it proposes pastors and titles State liberally to then use that money for purposes " noble " justified by "national interest" ) . Fractional reserve allow commercial banks to lend money deposited while sight and others and to participate actively in the process of creating money from nothing. After any amount of new money is created out of nothing by the process of printing (monetary aggregate M1), commercial banks expand them several times (depending on the expansion of compulsory reserve rate). The main beneficiaries of this privilege is the rule , central banks and commercial banks profiting fabulous initial deposit that same spot (say $ 1,000 ) is then multiplied by the maximum 10,000 (at a 10% fractional reserve ) and borrowing simultaneously from multiple clients at once. Bigger problem is that all these customers will participate in tenders for goods and services, although only one (the initial deposit amounted to) legally entitled to. The impact is clearly evident - inflation. Central banks were created precisely to ensure a minimum of funds to the account where the money was extracted in quantities higher than those who were initially deposited. Obviously more fractional reserve was impossible unless adopt and creating money from nothing and if not permanently abandon the link with gold (exchange only means that the required natural and voluntary market economy).The absence of bankruptcy: commercial banks are entities organized for profit (one that has far exceeded the rate of non- profitability of any industry). However, they cannot go bankrupt because they always back their central bank provides liquidity without any cost (close to zero) when you are wrong. Lacking privileged state bankruptcy and unconditional support these institutions (the state) make mistakes growing and exploit the moral hazard they have. Even if we admit that there has been in recent history, however, and bankruptcy of banks, bankruptcy was a coincidence, said marginal and extremely hard (which never happens in the non-financial private business).Thin capitalization Banks are institutions that operate with the lowest ratio equity / liabilities. If any business is dangerous to have less capital than 1/ 3 of total liabilities and no bank no longer look at you if you approach this report considering you too indebted to banks this report is less than 1/11 ( situation improved after the report had dropped dramatically by the 80 to 1/30 ). Commercial banks, unlike any other business, have the permission central bank (the State) to operate with such a low market capitalization, the unnecessary capitalization greater long that will capitalize central bank money ever made from anything if needed.Refinancing to privileged interest: they have a liquidity problem (temporarily fail to attract deposits or loans from other banks). Central bank interest money offers immediate intervention absolutely arbitrary set by the Board of the Central Bank acting independently and their faces monetary policy decisions based on models and depth studies " and very " analytical " . In fact, little by little, banks began to lose interest to attract household savings (which require far too much effort and cost well above the reference interest). They began to attract more and more investments in government securities then sold cheap liquidity by central banks.Tax privileges: commercial banks and central banks are out of many tax rules that work in any other field of services (VAT, profit tax does not apply to the central bank, etc.) It is quite clear effect they have these privileges both on the banking system (which in their absence and a free market would have acted totally different and would be interested in a different kind of governance and development). Another strong effect is the economic system and its stability. Central banks have created a phenomenal chaos approving and defending these privileges. Once accepted as commercial banks to become creative currency, central banks have entered a dangerous area of their monetary policy cannot be " optimized" for a monetary mass impossible to predict the size (the central bank is known that the maximum of X or M1, the value of X is determined by the reserve requirements - whether its 10% then multiply it up to 10 times). In addition to monetary chaos created we deal with a different kind of chaos more dangerous to capitalism and private markets: noting how easy and safe (bankruptcy difficult) can make substantial profits from banking, more and more are oriented towards industry and setting aside any entrepreneurial project. More and more we flock to participate in the money multiplier, sorting, cleaning, counting, guarding, transport, distribution of money created out of nothing. The rest is ... in a great crisis.[footnoteRef:6] [6: Charles Einsenstein, Sacred Economics. Money, Gift, and Society in the Age of Transition (http://sacred-economics.com/wp-content/uploads/2012/01/sacred-economics-book-text.pdf);]

2.4.2. Effective Employee retention strategies[footnoteRef:7] [7: B.B. Mahapatro, Human Resource Management, New Age International (P) Ltd., 2010;]

Recruitment and selection as a function of Human Resources is one of the activities that have critical impact on the performance of the organization by affecting the share market and the competitiveness of the company. So, recruitment and selection strategy has a central role in people management activities, with workforce planning.The recruitment and selection is defined as the set of activities and procedures required to generate a sufficient number of qualified people at the time and place in order to achieve short and long term objectives.The success of the recruitment and selection process depends on a workforce plan, strategy identification and selection of the most suitable candidates, according to the organization's objectives. This strategy may include the following sources of candidates: internal sources of the organization ( intranet , internal references , newspaper company , etc.) organization external ( job fairs , recruitment agencies volume , specialized agencies , agencies ' head-hunting ' , internet etc. ) internship programs of the organization key points in developing a strategy for recruitment and selection : offer organization ( working environment , salary package , development plans , positioning vs. . Competitors ) ; the budget for recruitment (cost / channel position by recruiting the volume of persons to be recruited per level workforce plan ) ; target "public" ( showing that recruitment market availability now and in the near future , leading to difficulty of recruitment , recruitment sources , management of process) ; labour plan (which indicates the human resources company history determined by movements, present and future strategy of the company through specific activities ) ; recruitment and selection strategy always starts from the strategy of the organization in the short and long term; organization's culture is the element of nuance in involvement of the recruitment and selection strategy influences the degree of retention , turnover of staff ; recruitment and selection strategy is based on managing the data obtained in this segment of the time by the company.Human resource planning is part of business planning and analysis and identification is the process of staffing the profession, qualifications, age, gender, etc. Human resource planning begins with identification m and recognition philosophy and mission of an organization and continues to examine the external environment, assessing strengths and weaknesses, predict organizational capacity, setting goals and strategies and implementation plans that review.In human resource planning is conducted by: identifying occupations and trades deficient in terms of qualified staff, staff turnover analysis, comparison with the available business requirements of the organization and the market.HR planning always starts from the business strategy of the company, business strategy determines the number of positions, their cargo, the level of human resource development, work load and future expectations, planning must retain a degree of flexibility and dynamism, depending on company decisions on activities that will take place.

2.4.3. Finding a cause

Government approved the establishment of a legal framework that allows banks bridge (bridge bank) whose role will be taking credit institutions threatened by bankruptcy, raising new questions about the stability of the domestic banking system.The action is not, however, a concern, it's just a precaution justified in the context of existing problematic situation externally, according to analysts.Setting the bridge bank is not a new thing. The project was discussed with the IMF since the middle of last year. I do not think it takes into account the bank immediately using the bridge, but at the same time, it is better to be created as many facilities to limit the possible dangers if it still needs state intervention.In the context of external finance dependence of banks in Romania, any effort to prevent potential problems is a good thing.You will not need this tool in the very near future, but, rather, is a precaution in international context still troubled by financial bond fund that has Romania in EU states, given that our banking system is owned as to 85 % of banks with foreign capital. Thus, it can only be a good thing that there are also policies that limit potential hazards.Regarding the overall situation, banks in Romania are good, most analysts believe, at least in comparison with the situation in neighbouring states.The situation in our banking system is good enough considering that in Europe things are very difficult. In Romania, the banking system is doing better after indicators that everyone follows them after stress tests that can be done. The system has a very good rate of solvency in general, so there should be no reason for concern. It is better to be cautious and vigilant. NBR closely follows the banks; we have things under control, given the situation in Europe.The banking system is relatively solid, but not particularly strong to see an acceleration of lending activity in the European banks so long desired an improvement in capitalization. Extending credit from previous years was made generally based on external funding lines, and, as they will be reduced, it seems likely that lending to slow or remain very low levels in recent years.In addition, the possibility of establishing a bridge bank may boost banks in difficulty to find the best solutions. There are a number of banks in difficulty and then the existing bridge will boost bank to find their own preferred solutions against thinking of buying them. It's a good thing. The banks in Romania are not worse than in other countries, on the contrary.One drawback is bank - deck inconvenience that might greet customers during the transition period.For customers, it is a problem due to the fact that management will be difficult at first, given that the bridge bank may not have all the personnel needed customers. It will be a problem.Bridge bank establishment procedure consists in the transfer of assets and liabilities from a credit institution that is subject to a measure of stability to ensure continuity of banking services and premises eligible for sale to a private investor, according to the ordinance approved by the Government.In the context of the international economic situation and increasing, currently the level of risks to financial stability, it becomes absolutely necessary to improve the tools available to the supervisory authority additionally accessible in the special administration procedure ; it is stated in the official document.[footnoteRef:8] [8: Simeon Djankov, Inside the Euro Crisis , October, 2013;]

2.5. Training & Development and Career Planning

In the banking system, as in other types of organizational activities have emerged as adaptations of people, the employees work (as tasks become more complex, sometimes totally unknown in Romania), and changes in job requirements of employment. As a result , we have, on time, every field of organizational , certain organizational behaviour profiles evaluated as desirable , was associated in practice with professional performance for executive staff and managerial effectiveness for personnel management function .Personality problem thus presents particular importance is assessed empirically as essential for social and professional performance of an individual. Thus, education (in the development) of those professionally desirable personality traits (through their association with success in the case of professional performance) in a particular area (in this case the bank) is in our opinion a problem of great interest organizational and managerial future.Gradually deepening and diversifying concerns the issue of personality, we included within the scope of investigation of banking employees, both the state and private sectors. In the manifestation of personality traits, operational direction took us to the human group (work), and then we get the group of employees in the banking sector, with a possible significant comparison between the groups of regular employees, namely personnel function execution of banks and the size of their management staff.For this we turned our attention to the role of personality traits (sharp) in Banking (specific) and the relationship between personality traits dominant employee profile in this area and the banks performance. Subjects banking domain acquired certain peculiarities, which must be studied and considered for any subsequent intervention character optimization and professional and organizational development.Picture of dominant personality traits banking has imposed two research directions: on one hand it's about analysing dominant personality traits (sharp) specific to banking, on the other; I watched the relationship between these traits dominant / sharp personality and performance / efficiency in banking professional.The objective of this research was to identify the dominant personality traits (sharp) employee profile in banking and the relationship between them and the professionals performance.The specific objectives are to establish the types of features enhanced / dominant personality banking employees , highlighting sharp personality types share banking staff , identifying and comparing personality traits accentuated / dominant executive staff to the management of banking , tracing leadership styles practiced in banking under the influence of sharp features / dominant personality , identifying the dominant management personnel in this field , describing the relationship between personality traits pronounced / dominant bank management personnel and efficiency management and statistical correlation of the variables surveyed.In research we left the following assumptions ( hypotheses ) personality profile of the employee Banking certain personality traits show a higher level of development, becoming dominant / sharp , it is expected that the personality profile of employees in the bank following personality traits are dominant / sharp ( submit high scores ) : hyper perseverant , Hyper exactness, hyperthermia , ability status , responsibility , social conformism , self-control , self-acceptance , job orientation , achievement by conformity , impression , Sociability , social presence , intellectual efficiency , friendship , orientation law enforcement, flexibility , assume that the bank employee status ( position of executive / management) results in some differences in profile features sharp / dominant personality , it is expected that the scales Next person : hyper perseverant , hyper-exactness , social conformism , self , work orientation , achievement by conformity , scores of employees with executive function is higher than the employees responsible for the management , it is expected that the following personality scales : responsibility, status , social presence scores obtained for the management employees to be higher than employees with executive function , we assume that the personality profile of employees with managerial positions appear in addition ( to the employee executive function ) following dominant features ( with high scores ) : proof, dominance , leadership , assume that there is a significant relationship between enhanced features / specific dominant personality in the field of banking staff and its professional performance , is expected that the development of the personality supposes traits as developed banking staff significantly correlated positively with the level of professional performance , we assume that there is a significant relationship between enhanced features / specific dominant personality for the management staff of the bank activity and its managerial efficiency , it is expected that the development of personality traits allegedly developed staff management position in banking was significantly correlated positively with the effectiveness of managerial employees assume managerial style for the management of the bank specific characteristics transactional leadership style , assume that the variable gender has an effect on personality traits identified as dominant banking employees , assume that the length of banking correlated positively with the level of development of personality traits identified as dominant for employees banking , assume that seniority leading banking correlated positively with the level of development of personality traits identified as dominant for employees with managerial positions in banking.

2.6. Strategic management[footnoteRef:9] [9: Beine, M., Docquier, F., Rapoport, H, Brain Drain and Economic Growth:Theory and Evidence, Journal of Development Economics, vol. 64, 2001;]

In 2009-2010, Romania's financial stability has faced significant challenges, but remained robust. Bank capitalization increased to comfortable levels and liquidity remained at levels consistent. Necessary additional capital came exclusively from bank shareholders. Romania did not use public money to support the banking sector during the crisis, calling proactively stimulate capitalization and regulatory measures. Solvency ratio at the aggregate level are at a comfortable level (14.7 per cent in December 2010), all credit institutions showing an individual solvency ratio above 11 per cent.The results of the latest stress test banks' resilience to economic shocks showed that the capital adequacy ratio and Tier 1 ratio would decrease by a maximum of 3.5 percentage points less likely to consider the adverse scenario to materialize.The profitability of the banking sector was affected in 2010. Restriction in real private sector credit and loan portfolio quality deterioration contributed negatively to changes in net interest income of banks. Decreased risk appetite, reflected by strengthening lending standards of credit institutions and their orientation towards low risk investments had a negative impact on profitability amid strong deleveraging process . After 2009, the Romanian banking sector recorded positive financial results (193 million euros) for the whole of 2010 reported losses (71 million), mainly due to the increase of provisions as a result of the increase in credit risk. End of 2010 the loss is not a generalized feature of Romanian banking sector. The main medium and large banks were 2010 maintained positive in terms of profitability.Loan portfolio quality deteriorated in 2010. Neperformante5 rate loans increased from 7.89 per cent to 11.85 per cent (December 2009 - December 2010). As economic growth will gain consistency, it is expected that the pressure on bank asset quality will diminish. National Bank of Romania (BNR) will continue its prudent approach, monitoring the level of provisions to maintain the appropriate values that can cover the expected risks and solvency levels remain comfortable thresholds to allow cover any unexpected losses. Future development of non-performing loans (with into account the time lag between economic growth expected in 2011) , and the challenges posed by foreign currency lending to borrowers unprotected currency risk , however, remain major concerns in the short term . In the medium term, the main challenges are changing the business model of the banking sector in the context of shaping a pattern.Sustainable economic growth different from the previous model of growth, as well as against present and future changes in regulation and supervision of the financial sector at EU level with increasing financial literacy of the population, to prevent any future developments unsustainable credit flows . NBR believes foreign currency lending as a problem both stock and flow. BNR will carefully monitor developments in foreign lending and take measures to ensure that foreign currency lending is done so that the risks of unheeded borrowers are covered properly and accurately reflected in the costs and prices of financial services. NBR has taken early (since before 2004) measures to reduce vigour of credit in foreign currency, using a wide range of tools prudential, monetary and administrative. Measures have proved effective, but their effectiveness was limited in time and due to full mobility of capital, experience similar to other countries. In this context, a holistic approach is needed at European or international level measures taken at national level (with particular borrowers and local subsidiaries of foreign banks) must be supplemented by an improved risk assessment and management, translated into commitments by parent banks, as well as increased and more effective cooperation between supervisors and regulators in the host and home countries.Establishment of the European Systemic Risk constitute prerequisites of such an approach with increasing focus on the definition and implementation of a coherent EU framework for macro-prudential measures.Restoring credit must occur on sustainable principles, the role of domestic currency lending to become predominant. Macro device will be used for providing such developments. High indebtedness of the population suggests that banks need to focus lending to non-financial corporations. In this context, further fiscal consolidation for the eviction of private sector banks resources to diminish.The principle that adoption of the restructuring of a credit institution must ensure that its creditors a treatment no less favourable than if the institution in question would have gone straight into bankruptcy in the absence of restructuring measures. Thus, creditors and any person shall be deemed prejudiced by measures may address the court for damages, the amount of compensation is limited to the difference between the estimated amount that would have been obtained by the creditor if the credit institution would have gone straight into liquidation / bankruptcy and the value actually obtained for his claim to the institution of liquidation proceedings credit, after application of the restructuring.On the other hand, GEO nr.131/2010 amending and supplementing Government Ordinance no. 39/1996 on the establishment and functioning of Deposit Guarantee Fund in the Banking System - FGDSB (republished) provided to regulate the conditions relating to the establishment,The obligations assumed by the Romanian authorities through the new precautionary agreement on the financial sector whose main objective is to further strengthen the banking system and further reforms initiated as a result of the measures provided in the previous agreement . These concern , in particular: amending the legislation so that the resources for financing FGDSB ( including the issuance of guarantees) restructuring measures authorized by NBR on the transfer of deposits , including the transfer of assets and operations assuming liabilities where this is less expensive than paying compensation guaranteed deposits ; development of procedures required to implement the new responsibilities of the central bank and FGDSB in restructuring credit institutions, as well as providing immediate access to government funds FGDSB if needed ; ensuring consistency of normative acts components of the legal framework the liquidation of credit institutions ; widening the scope of the central bank eligible collateral in refinancing operations to include bonds issued by international financial institutions listed on the Bucharest Stock Exchange and government Eurobonds ; establishing a prudential treatment of temporary holdings obtained following a restructuring of loans that do not lead to weakening financial position of banks ; monitoring of foreign currency loans and to take action to reflect the risk that the value of their grant to unheeded borrowers ; adopting legislative initiatives bankruptcy individuals or recovery, which could undermine discipline borrowers.Romania agrees to the application of a European solution regarding taxation of the financial system, with preference for a levy rather than a tax on transactions or activity, provided that this does not aim to maximize tax revenue, but the build target a non-budgetary fund of resources designed to help ensure financial stability in the future, addressing in particular address the situation troubled banks (bank addressing resolution). However, we disagree with the activity or transaction fee without assessing the cumulative impact of several types of potential duties on parent banks and their subsidiaries strengthening capital requirements under Basel III by introducing and CRD IV , for avoid relocation and financial intermediation distortion contribution to sustainable economic recovery in the real economy .If the preventive measures taken by the central bank early intervention to avoid systemic risk in the banking sector would be insufficient to counteract the possible incidence of financial turmoil on credit institutions of systemic importance, maintaining financial stability will be ensured by applying contingency plan. Contingency Plan indicates cases requiring the intervention of the supervisory authority and describes policies and procedures for resolution, which can guide the management of a potential banking crisis in our country. The main purpose of this plan is to provide an operational framework to enable prompt reaction of the central bank for an impending crisis, their regulatory mechanisms, monitoring and control, so as to limit potential systemic event spread to the real economy, including depositors. Given that, most credit institutions operating in our country are subsidiaries of major European banking groups, the content of procedures that form a contingency plan should be harmonized with the future EU framework for bank recovery and resolution problem, once the latter will be adopted as a Directive profile (follow the legislative proposal to be released in the second half of the year).

2.6.1. Strategic HRM and its role during crisis[footnoteRef:10] [10: Ronald Grigor Suny, Terry Martin, A state of nations, Oxford University Press, 2001;]

The first crisis that marked the world economy was between 1815 and 1818 and the second crisis, very hard, was in 1846-1847, which prefaced in 1848. Followed, in 1859, a period of established capitalist economy, but in 1873 came another crisis stronger, eventually leading to the outbreak of WWI. The deep crisis that has seen a capitalist economy was between 1929 and 1933. He debuted in the U.S. with the New York stock market crash. But that was only the signal from the surface, as now. The real crisis is down, basic structures of the economy.Currently, the world economic crisis amplifies each day, and Romania increasingly begins to feel the economic recession in the great economists of the world and fail to find the antidote. And the man will feel the crisis in companies in Romania.On the one hand those who have contracted development loans or cover other needs work , they wake up in their inability to repay these loans , while darkening the possibility of payment of suppliers , especially those who have made payments currency.On the other hand , since world markets are plummeting , and the Bucharest Stock Exchange lost in just a few days over 2 billion, companies cannot rely on them as sources of funding so that another variant cover needs financial is totally blocked .How the economic crisis , it is expected that credit requests from companies to the banks to fall, so the full picture is emerging of unprevailed financial crisis , which will throw very many bankrupt companies in Romania. The effect is one of kickback, because creditors under normal conditions as agreed to grant more grace time from their business partners who have earned money and are now in conditions of economic crisis under pressure from their creditors, will put further pressure high on their debtors, to be paid the money and will be a chain reaction, because most companies will not find the resources to pay its debts when due, and shall, unfortunately, the way bankruptcy. We actually assaulted by creditors who say that increasingly more of their business partners surpassed the payment terms that were due in January 2008 , as it cannot find the necessary financial resources to settle their arrears they have , and much worse, declare that any term not identify any real possibility of payment of debts.One cannot so do not think that if in the end of 2007 we complain that we do not find enough labour in Romania , it is possible that at the end of 2008 , much earlier than anticipated , the economic crisis , will encompass a level of rising unemployment in our country.Function of human resource generally tends to swing between two extremes that role very common, namely: role operational and strategic role. In Romania, currently the most visible trend is that it has an operational role (executive) support the activity of the company. But the financial crisis that occurs worldwide and currently shows its first manifestations in Romania and make it to be a good time for HR function to become a strategic partner in solving problems related to the crisis and planning objectives at organizational .Impact of the crisis and the company, including the human capital in each organization should be analysed separately. Although we can say that there is a set of negative effects generally valid if the crisis is - that entity is affected differently depending on the activity. Analysis of these influences is needed to establish points on which it will operate. One of the most common reactions to the organization as a consequence of the crisis is the adjustment of reducing costs. This strategy is applied very often and the HR function which can take two forms:1. Direct intervention to adjust your budget. This category includes primarily the wage fund shares which may be manifested by freezing or even reducing it based on collective redundancies and temporary stoppages of work. In the same category we also budget adjustments related benefits, training, recruitment and social activities.2. Indirect intervention aimed at increasing efficiency. A financial crisis of this kind is a good reason for companies to conduct a thorough internal review of the roles and processes to identify unproductive activities and responsibilities between different positions intersection. In this category of interventions includes absenteeism management, analysis responsibilities for each position, analyse the costs of these responsibilities, flexibility of work (e.g. halving wage costs may materialize and reduced norm has two employees) and enhancing internal communication to motivate staff.It is quite difficult to establish a number of typical errors made frequent HR people and other representatives of the top management in such crisis situations. This is due basically to the fact that although cyclical financial crises are not so frequent as to be experts in such situations. Despite this, there are some points on which each of us must be careful in such situations: Panic. Financial Crises fast and drastic effect on which have acted in a way that ensures a long rehabilitation organization; Application of indiscriminate cost reductions. Cost reductions must be guided by the relevance and impact to the organization; Short-term thinking. Financial crises are a cyclical phenomenon that occurs at a certain time and can last between 12 and 18 months. Actions based only on a short time horizon may neglect a number of opportunities when the financial crisis goes; A shift to the lowest price. Going somewhat in tandem with the error mentioned in the preceding paragraph , an orientation providing a cost as low as possible and do not take into account the effect of , the related cost that can lead to a final output more negative than the recommendations values. In consumers' minds, the most affected areas by the economic crisis were in January this year auto industry - 70 %, construction - 68 %, and agriculture - 67 %.

2.6.2 Job analysis, planning and recruitment during the crisis[footnoteRef:11] [11: Brian Becker & Barry Gerhart, The Impact of Human Resource Management on Organizational Performance: Progress and Prospects, Academy of Management Journal, August 1, 1996 vol. 39 no. 4 779-801;]

Recruitment and selection are complementary activities in the staffing process. Recruitment - refers to the confirmation of the need to hire new staff, location and attract those interested in applying for jobs offered; Selection - is the final stage of decision making in the recruitment process , it represents all the processes by which people choose what meets the qualities, knowledge, skills and abilities necessary to achieve the objectives, tasks , powers and responsibilities circumscribed to certain posts .Phases of this work are defining a job that results in a job description are detailed job requirements and the types of skills needed to meet these requirements and profile of the ideal candidate.Attracting candidates. Recruitment may be internal or external organization. External recruitment takes place in educational institutions through consulting firms and recruitment (so-called head- hunters ), employment agency employment, advertisements in the media, based on recommendations made by employees of the company.Selection. Candidates may be required to submit a curriculum vitae (CV), a motivation letter (of intent) and letters of recommendation. CV can be free or standardized format and handwritten letter must necessarily quite often it is subject to handwriting expert.Among the candidates who have submitted these documents retained as interesting group of candidates for the firm may be asked : an interview ( telephone or face to face ) that may occur after the tests (medical, aptitude , intelligence , training , etc. . ) . Many companies use aptitude tests, interest and personality to compare job requirements with certain characteristics of candidates. One of the most known and used such tests is MBTI (Myers Briggs Type Indicator); a series of interviews (with the direct, human resources manager, general manager).In conducting the interview can be approached various strategies (Table no. 30) : honest and friendly approach , the approach focuses on the candidate's past behaviour , approach -oriented problem solving ( situational interview ) approach aimed at creating a stressful environment . In practice, combinations of these strategies are used.The main findings of numerous studies on the effectiveness of the interview as a selection method are: structured interviews provide greater safety; interviews are strongly influenced by the favourable than unfavourable information; agreement among many interviewers on the same candidate increases as the amount of information about the vacancy is higher; since the beginning of the interview sets a direction that the final decision usually comply; intelligence is the most valid estimated in the interview; interviewers can explain why a candidate gives the impression that it would be an unsatisfactory employee , but not likely to be a satisfactory employee; written data appear to be more important than physical appearance in judging the candidate, and this depends on the experience of the interviewer; the interviewee is evaluated in an extreme degree when it is preceded by a candidate with opposite value; interpersonal skills and motivation are probably best assessed in the interview selection; enable the candidate to speak can be overcome risk a decision based on first impression and observation of behaviour; the personal characteristics of the interviewer influences the behaviour of the interviewee; experienced interviewers tend to be more selective than those without extensive experience.How selection interview is a meeting between people cannot eliminate the risk of taking impressions based on first impressions, or human error. Some candidates with good technical skills can fare poorly in the interview selection, becoming angry or excited, leaving the wrong impression. Research shows that interviewer experience enables him to overcome these factors and take the right decisions.Candidates can expect questions such as What do you know about the industry in which the company operates? What contribution can make to achieve the organization's objectives? ; What problems do you think the company will face in the coming years? What strengths and what bridge deck weakly? Are you satisfied with your career so far? What crisis have recently encountered and how you solved it? What decisions do you find difficult to make? Why do you want to go (you go) to the current (old) job? Why do you want to work in this company?After having considered all the evidence (CV, tests, letters of recommendation, interviews), the final decision is taken. It made a job offer to the selected candidate, which he can accept or reject. The hiring process is attempted harmonization of job candidates with the skills and capabilities to ensure success in the new position of that person.Integrating employees - aims to facilitate faster integration into the organization. Including staff and framing consists of all effective job allocation processes selected individuals, including preparation of all necessary formalities.To integrate executive staff resorting to establish a guide ( mentor, tutor ) in the person of a more experienced colleague or boss directly in the service of " employee manual " containing information on: presentation of the company, working conditions, disciplinary, trade union organization, medical facilities , transportation, cafeteria, training policy, payroll, career paths etc. .Managerial staff can organize special training sessions, touring company presenting new employee key people in the organization, debates etc.

2.6.3 Testing, interviewing and selection during the crisis[footnoteRef:12] [12: Brian Becker & Barry Gerhart, The Impact of Human Resource Management on Organizational Performance: Progress and Prospects, Academy of Management Journal, August 1, 1996 vol. 39 no. 4 779-801;]

Training and employee development - aimed at identifying , assessing , and - through training planned - facilitating the development core competencies that enable individuals to perform tasks related to present or future positions .Once an employee has been appointed to a post, using several types of training that is allowed to update their skills. For some, the focus is on technical training (person is helped to improve their skills using the equipment or technical programs). For others, the training involves interpersonal skills (ability to work with others) or cognitive (the ability to think clearly, plan and solve problems). Other programs are sometimes called training programs, although they are actually educational programs aimed at expanding the vision of a person or understanding the issues and problems that are often essential to the development of people in managerial or certain positions within the company.Objectives and improving employee training are helping them to achieve a maximum performance in achieving their work and prepare them for future employment development.Training and staff development can be achieved both at work and outside the company , using a variety of methods and techniques such as problem solving , case studies , presentations , demonstration , films and video technique discussed in the group exercise work with documents, role-playing , games , critical incidents , simulations , experiential learning out-door For training programs to be effective it is useful to be integrated into the general policy of the company in the field and to be preceded by an assessment of positions and persons who deal in terms of compatibility knowledge, skills and attitudes required and held.The term coaching ( coaching ) is taken from sports where the coach is to follow the work of the athlete , to assessing performance during competition , to eliminate those who are not doing , give them instructions and to reintroduce the game . Performance is reviewed at the end of the competition, the process followed by the intensification of efforts.This ancient principle is increasingly used in organizations, a proof of this is the appearance of names of positions such as chief coaching officer" or "knowledge manager . A form of mentor -disciple relationship to it in which a manager with little experience is the charge of an experienced manager who has the role of the train. A form of training is job rotation, a person spending time in a series of posts to gain specific experience first-hand, usually under the guidance of a qualified person.Recently, more and more training programs began to dress modelling format. The usual practice is that the video of the actual performance or staging of role play to demonstrate undesirable behaviours. The practical training through roles observed behaviour.Managing careers - aims to ensure long-term correspondence between the career development needs of employees and positions and career paths available within the organization. The assumption underlying this approach is that people want to advance in the organization.

2.6.4 Performance management, benefits and appraisal during crisis

Efficient use of human resources is an undeniable differentiator and a mandatory attribute of any successful company, marking the long-term evolution of the business.Overriding importance of human resource is more than proven in todays times, when economic instability subtle attacks well-developed strategy.For consolidation and business evolution is not enough to rethink strategies to reduce costs and take advantage of new market opportunities , but we have to consider and "emotional intelligence " of our business, the people without whom any plan or computer equipment remain simple map or settings.We all want the best specialists, but how we attract? How do we keep and how motivate people especially when business is at a crossroads? We have to reduce spending, to cut bonuses, to reduce the number of jobs. Interference factors in the current economic climate, such as stress, self-image affected by falling living standards , fear of job loss or fear of a possible bankruptcy of the employer, have negative influence on performance at work , the effects direct and immediate effect on the smooth running of the business. Motivating employees is important, but never enough. I wonder what employees need to be effective?Team effectiveness based on motivation and especially by stimulating the involvement of its members, does not work after a general pattern available. The many variable factors in this equation - the industry, organization size, etc. - Makes it difficult to quickly obtain the best solution without the support of the focus on the subject. Relying on the advice and experience of professionals proves to be an appropriate approach for a successful business.An area of expertise includes: investment plans by optimizing costs , retirement plans positive impact on business performance and financial results , advice on health ; solutions for attracting , rewarding, retaining , motivating and stimulating the most talented professionals , plans to pay that aligns the interests of employees , business goals , attract and retain effective employees , strategic communication plans to change staff attitudes aimed at personal benefit and impact in increasing the productivity of the organization , surveys and reports on the level of employee satisfaction and methods its growth , tools for increasing efficiency and improving competitiveness.

2.7 SHRM solutions for companies during crisis

The global financial crisis has increased dramatically, the speed at which trading conditions may change, forcing companies to review their strategy to maintain its market position and to ensure the liquidity required. For a company to survive there must be monitoring and continuous improvement of systems and operations. In many cases, businesses that have not administrative liquidation finally paid attention ominous alarms and have sought assistance at the right time.To avoid unintended consequences, there is an alternative, the management of recovery ( turnaround management" in literature).Recovery Management (William L. White, 2000) is designed for corporate renewal and management review involves an analysis of the essential causes of failure and the cost of the activity, develop and implement a strategic plan and restructuring, bringing that company's solvency status or competitive position market.Failure can be caused by: lack of knowledge and experience, lack of planning, poor management, conflict in management; not seeking or disregard performance indicators; market conditions, new competitors and strong mismatch in market conditions; fraud, inadequate financial controls, reduced ability to collect receivables, the excessive burden of debt; optimistic sales plans; high level of operating expenses; excessive or insufficient investment.If we were to look at Romanian SMEs[footnoteRef:13], an important element highlighted in the White Paper of SMEs in Romania in 2011 (CNIPMMR, ninth edition) is that, of all the companies analysed, 49.25 % do not carry out all planning activities, and only 8.84 % develop strategies / plans three to five years - such failures may mean in the future even market exits or partial loss of sales. The same study shows that between October 2008 - March 2011 (during the crisis), 44.44 % of the investigated SMEs have limited workload, only 12.69 % with a relative increase and the remaining 42 87 % have stagnated. [13: Small and medium enterprises - companies whose personnel numbers fall below certain limits. The abbreviation "SME" is used in the European Union and by international organizations such as the World Bank, the United Nations and the World Trade Organization (WTO). ]

Recovery managers appointed external consultants that can play a crucial role in the efficient recovery of companies in deadlock, bringing a fresh perspective and an objective eye to analyse the present situation. Their duties can last between 3 and 24 months, depending on the size and complexity of the work organization. Recovery Management applies not only to companies in serious financial statements, but in fact it can help in any situation where the orientation, strategy or overall change of the state of things should be implemented. Typically, these managers come with a team of specialists who have specific domain knowledge and skills addressed: financial, project management, human resources, marketing, production and legal technology, etc.[footnoteRef:14] [14: William L. White, Recovery Management Definition, SAK Productions inc., 2002.]

Chofer, in his book, Turnaround Strategies (Journal of Business Strategy, vol. 1, no. 1, 1980) presents two ways of Recovery Management, which is replicated in the modern management books:1. Strategic recovery that might force the company to change completely how to operate, to enter into new business or to reposition the portfolio of products on the market.2. Recovery may target operational assets reduction, rapid growth of income, cutting costs and combinations of those mentioned. Some cases:- If a company operates far below breakeven, we must take steps to reduce assets. This will reduce fixed costs and help reduce the total costs of the firm.- If the company actually works, but not very far below breakeven when appropriate recovery strategy is to produce extra income.- Operation near but below the breakeven requires the implementation of a combined strategy. Under this method, all actions to reduce costs, and reduce income producing assets are followed simultaneously through an integrated and balanced step. Strategies combining direct positive impact on cash flow and profits.- If the company operates around or above the breakeven point, then reduction strategies are preferred because they are easily carried costs and increase company profits once unnecessary costs are reduced.But without an adequate implementation plan will not guarantee success. Selected strategy must be pursued relentlessly and have made every effort to make this work. The success or failure of recovery strategies depends on the commitment shown by executive management, and operational management.Recognizing the role of the foundation of private enterprises and the role that recovery consultants can play in reviving a firm in stalemate in 1993, EBRD, UNDP and the EU have created Turnaround Management Programme (TAM) - in order to help businesses in countries less developed to survive and compete in market economies. The program was a non-financial support, involving consultants with a minimum of 15 years experience in the relevant industry executive, who worked side by side with company management over a period of 18-24 months. The companies came from various industries and ranged in size usually had between 200-2000 employees. Among the countries involved in the program included : Albania , Armenia , Azerbaijan , Bosnia and Herzegovina , Bulgaria, Croatia, the former Yugoslav Republic of Macedonia , Georgia , Kazakhstan, Kyrgyz Republic , Moldova , Mongolia , Montenegro, Romania , Russia , Serbia , Tajikistan , Turkmenistan , Uzbekistan . In Romania, at the time of writing, TAM program is not active. Intervention impact is evident: 85 % of projects were classified as successful" or "very successful by an independent appraiser - on average companies experienced growth aided by nearly 20 % in turnover and an increase of 30 % productivity .While in Romania most businesses have no strategy and turnaround management consultants coming few more of affiliates companies in Western countries in West Management Recovery is a general practice, there is a vast literature and a sector competitive private. Is Romanian consultants may take on a role in transforming Romanian business in a competitive, based on effective management? And if so, does the demand for consulting will be oriented towards prevention and stabilization in the market and will go after opportunities in a chaotic jungle landlocked?

2.7.1 Innovation leads to competitive advantage

The concept of competitive advantage has become, in the last two decades, one of the most intensely debated and analysed. Considered essential to long-term development companies, competitive advantages are seen as true turning points activity companies. At the same time, competitive advantages are seen as the answer to Why do some companies fail to become efficient, while others stagnate or go bankrupt? It is true that these advantages must be the main objectives of the company, but attention must direct primarily towards specific sources and through which you can gain competitive advantage. Study how to acquire competitive advantages is the task of strategic management, which is essentially the formulation, implementation and evaluation of decisions that enable a company to achieve its objectives and that influence long-term performance. Based on the main objective of any company represented by the desire for profit, strategic management is focused on the integration of all activities of companies in this direction. The primary role of strategic management is to create and sustain competitive advantages, particularly through analyses, decisions and actions taken by the company (Banks, E. & Dunn, R., 2003).This advantage is the result of detailed analysis and strategic planning, through which the company identifies opportunities arising in the market and exploit these opportunities allocated resources. Strategy is more than drawing a linear direction toward a goal stated above. The strategy is, above all, a way of thinking that involves observation of all activities taking place around the company and decisively influences every decision taken by it. Corporate strategy should represent a lifestyle and not just a means to achieve a particular purpose. Thus, our scientific approach will focus on specific ways that companies observe and react to different events that occur in the environment in which they operate and the decisions arising from these events in order to identify the mechanisms underlying the growth companies. It is very important, strategic formulation process to ensure flexibility and adaptability of the chosen strategies. Dynamic environment in which they operate companies work requires providing mechanisms by which they will be able to adapt to the new changes, so as to ensure continuity of competitive advantage gained. It should also be noted that nine out of ten strategies fail due to poor design and management of the implementation process. Why? Is it really that important strategic implementation process? The answer to this question is YES. The most brilliant strategy formulated in the most efficient way possible, will lose its effectiveness in the absence of a mechanism to ensure the implementation of the principles and strategic goals. Unfortunately, the theory and practice of strategic importance given to the implementation of strategies is significantly lower compared to the formulation of strategies. The important causes of this imbalance, from our point of view, result from the different characters of the two processes. Strategic formulation is an analytical process, being relatively easy for managers to quantitatively assess the environment in which the company operates thus, the indicators obtained by analysing the evidence we can draw conclusions that will lead ultimately to identify and formulate the most appropriate policy options. On the other hand, the strategic nature of the implementation process does not allow full, its structure only based on purely quantitative indicators. The most important part of the implementation strategy is the creation of an optimal context for the strategy formulated to result in the acquisition of competitive advantages. In this respect, significant changes will be brought to the organizational structure, especially the values, attitudes and skills of the staff in the company, leading to the need to change the organizational environment. From the point of view of the possibility of failure of the implementation strategic mismanagement of organizational change is the greatest danger in the first place , because changing values, attitudes or existing rituals rooted in the company, without generating fierce opposition from employees is a very difficult process and , secondly , because the evaluation of the effectiveness of organizational change process is not a purely analytical process but involves analysing data from the perspective of the employee mind-set . Based on the considerations outlined above, this paper aims to study the characteristics of central enterprises in the construction industry and the efforts made by them in order to gain competitive advantages. Upsetting relations of cooperation between firms in the same industries lead to the rarefied collective achievements, such as research - development and training, which played a decisive role in promoting technological innovation and labour productivity in developed countries.[footnoteRef:15] [15: Banks, E. & Dunn, R., Practical risk management. An executive risk to avoiding surprises and losses. John Wiley & Sons, Ltd, Chichester 2003.]

In Romania with multilevel hierarchy prevails, with the disadvantage that, due to the proliferation cancerous information, the employees directly affected by the measures taken has least intention of the management team. This leads to a practical formula marked by some or abstract connotations imposed by a formal ceremony roles that cultivating the illusion of participation.Learning, especially in the workplace becomes an important strategic component.To this end, performing firms apply the following two principles: 1 ) to obtain the maximum benefits of new technologies , the company provides wide dissemination of know -how in the production staff and 2) organizing the rotation of the jobs , the scale of promotion and training programs likely to develop a taste for learning .These imperatives have to rely on more stable jobs and reward us. Such rewards are important because the employee sets out on long-term goals.In a not too distant future trends series production and shortening life cycles and accelerate product diversification and market innovative movement will cause instability profits due to the vicissitudes of demand and productive advantage. This new economic environment will favour large diversified firms. The new situation will force companies to strengthen profitability, protecting employees and risks, as well as with suppliers and customers, to the extent that they are well integrated upstream and downstream. Concessions providers may take the form of flexible prices and those of employees - greater participation in profits. In all cases, the sheep demands will lead to power-sharing in the risks growing.One of the major obstacles in the way of improving the economical Romanian performance is the lack of cooperation between individuals, but also between organizations. A first explanation is the lack of appropriate institutional mechanisms. Close cooperation with chosen difficult political parties of managers and leaders distrust syndicalism on participatory management and work organization. At the company level, cooperation is difficult because of narrow specialization, division sharp and bureaucracy. Therefore, the information flow is slow or inadequate. Romanian shareholders and managers have a great appetite for risk and defend territories, which is a serious problem, because it highlights a major weakness in technologically dynamic industries with more pronounced.Cooperation with other public companies and private continues to inspire confidence in Romanian. Currently, we pay dearly refusal to recognize the importance of the collaboration of public power, the business community, trade unions and universities to create the conditions for economic growth. Therefore, managerial, trade unions, employers and the public authorities are before crucial strategic options. If they will cling to traditional values and practices, we believe that the result will be escalation and diversion of resources to non-productive uses.Our national industry took over from the old regime large enterprises total uninterrupted upstream and downstream free markets and an important overstaffed personal.We find that while the structure - the firm responsible management framework to structure the five functions (research - development, production, trade, finance, accounting and human resources) and includes the subsystems production structure (sections, workshops, bands) and the functional (service offices) , organizational structure system of the company covers six subsystems:1. Technical planning - economic and investment;2. Management of the production;3. Technical preparation of manufacture;4. Financial activity - accounting;5. Employment and labour consumption;6. Supply, sale, import - export.It is noted that the information system subsystems do not overlap with the management structure, but run in parallel: the first has in sight the evaluation of the information grouped by certain specialized activities vertically, the second aims at merging the specialized activities vertically and horizontally, to achieve business functions. For this reason , the competition system of the company into account more than ordering products a program computer system and is oriented rather to meet the organizational sub- structure. Nationally relevant practical usefulness of ensuring coordination and management unit the whole of the computer by creating a central body that can perform a function not only methodological and operational management tasks. Thus, it would eliminate the current situation where many of the products - the program are done in parallel with intensive intellectual work.The majority of Romanian firms do not have the necessary strength to enable them to ensure completion of projects expensive and weld during recessions. This deficiency, plus the speed of change, stressed the Romanian firms focus on immediate results. In this way, they avoid any permanent commitment to vendors and their customers.In fact, it is critical old professional manager - an individual who knows no better and no industry or technology can, however, lead to any enterprise with strict financial controls, portfolio management and market strategies challenge.Therefore, the true head of the Romanian economy is generalized myopia new management orthodoxy. According to its abstract analysis Romanian managers prefer concrete experience, inquiring about more than reducing costs today than tomorrow's technological competitiveness. Therefore, our managers are more willing to engage in financial restructurings likely to revive profits than to take the risk of technological innovation.Rationality and creativity have always been considered the opposite characteristics; firms are more concerned with rationality. The rationale is interested in facts, and the facts looks pass that.

Chapter III - Background of the study

The difficult economic environment has influenced the Romanian banking system, both in the saving, and in the credit. The biggest challenge for banks in 2012 was credit risk, given that non-performing loans have increased and are expected to grow continuously. The rates of nonperforming loans were 17.34 % in September 2012, an increase compared to June 2012 when the share was 16.76 %.Lending will remain anchored in economic constraints, regulatory and cost. It is estimated, for 2013, an increase of a single figure government credit. Credit advance loan is dependent on the application, the eligibility of customers and related regulations, especially as it is aimed at limiting exposure to foreign currency lending borrowers.According to the official, international context, credit risk, the implementation of Basel III, and reduce exposures in the absence of investment alternatives remain major challenges to Romanian banking system in 2013.In 2012, the biggest challenge for the banking system was credit risk, given that non-performing loans have increased and are expected to increase further. NPL ratio was 17.34 % in September 2012 compared with June up 2012 when the share was 16.76 %.Banking system could register for the third consecutive year, a net negative result at the system level in 2012. At the level of September 2012, return on assets (ROA) is minus 0.04 %, while return on equity (ROE) is minus 0.34 %, according to data published by the central bank.[footnoteRef:16] [16: Balthazar, L., From Basel 1 to Basel 3. The Integration of the State-of-the-Arth Risk Modelling in Banking Regulation, Palgrav Macmillan, New York, 2006.]

Undoubtedly, the difficult economic environment has influenced the Romanian banking system, both in the saving, and in the credit. However, in terms of CEC Bank are confident that we will overcome, in late 2012 set targets lending segment and on the deposits. We expect that later this year to record an increase in the balance of 4-5 % to 7-8% loans and deposits, respectively, from the previous year.Staff restructuring is needed in the banking system, but there is no unique recipe each bank having its plans for cost effectiveness. Regarding a bank, a solution requires efficient local network. The bank will continue in 2013 to implement a series of measures to streamline the business, such as resizing and relocation of network units more efficient allocation, the areas that have growth potential, existing human resources and streamlining operational flows, to reduce costs.Lending will remain anchored in economic constraints, regulatory and cost. It is estimated, for 2013, an increase of a single figure government credit. Credit advance loan is dependent on the application, the eligibility of customers and related regulations, especially as it is aimed at limiting exposure to foreign currency lending borrowers.Are expected constraints on the lending to SMEs following the implementation of policy recommendations to restrict lending in foreign currency and the application of the provisions of the new agreement on capital requirements - Basel III? Aiming appropriate risk management , the recommendations the European Systemic Risk Board which is followed discourage foreign currency lending in the non-financial entities that do not receive income in foreign currency will reduce lending capacity . Difficult international context, credit risk, the implementation of Basel III, and reduce exposures in the absence of investment alternatives remain the main challenges to the Romanian banking system (Balthazar, L., 2006).Regarding a bank, the loan products accessible to individuals were personal loans with or without collateral. In a proportion of about 90 %, they were granted in RON. On loans to businesses, the most wanted products were revolving credit lines, awarded at the national conference dedicated to financing SME Excellence Award for the best product of the bank. Very affordable and loans were based on national agricultural development programs, loans for European funds and refinancing loans. For the next period we expect an upward trend in terms of corporate financing, without neglecting individualsIn the next period we will continue to focus on lending to agriculture, SMEs and local administrations. Its job is more difficult, the more the economic environment still bears the imprint of the international economic crisis. In this context, the need to identify and exploit opportunities in particular structured finance area. We will turn to all those who, regardless of size and scope, access European funds.One area that is expected onset of development projects in public-private partnership (hospitals, concert halls, portions of highways etc.).

3.1. Romanian banking sector[footnoteRef:17] [17: Calin Gurau, Online banking in transition economies: the implementation and development of online banking systems in Romania, Riccarton, Edinburgh, UK, 2002.]

The banking system in the socialist economy had a passive role. State Central Bank and banks were specialized in system elements called monobank literature. Banks were in terms of accounting and administrative functional entity that keeps track of borrowed funds to state in accordance with the financing plan, most often without a connection to profitability, risk and opportunity cost of financed projects.The main problem in creating an efficient and competitive financial sector is to ensure mobilization of domestic savings and allocating them to the most cost- effective uses. Fulfilling this function gives financial institutions a central role in enforcing financial discipline at the enterprise level.Banks will influence in different ways the conduct of privatization. From a purely financial point of view, they will need to ensure not only that private capital to buy state enterprises, but also lending to state that restructures. In the absence of other financial institutions, banks will have to provide advisory services to clients, playing a relatively important role even in corporate governance issues.In practice, banks remain the only institutions able to impose financial discipline on state enterprises, forcing them to comply with budgetary restriction. Thus most state enterprises and will not alone take responsibility modernization and restructuring.A competitive and efficient financial system is a prerequisite for the development of capital markets. Efforts of developing countries in the area of investment funds, bond and stock markets cannot succeed without the full range of services offered by banks to provide securities portfolio management, customer information and to support them in finding the most suitable ways to finance their projects.Financial and banking system as a whole fulfils other functions of the utmost importance for the economy and businesses, especially in terms of monetary policy transmission mechanisms and payment system.From 1990 to the present Romanian banking system has undergone major changes but the period of transition to a relatively stable structure is completed, given the significant processes that occur in the commercial banks. From a structural Romanian banking system is organized at two levels characterized by different functions - the first benchmark central bank which, according to its status, can be seen as monetary authority and banking authority; -on the second floor there are banks trade credit and other specialized institutions.Outside the banking system itself, but also in the sphere of financial relations act other financial institutions such as insurance companies, mutual funds investment, currency exchange, pawn shops and a relatively small but undetermined number of people offers high interest loans (Clin Gurau, 2002).

3.1.1. HRM in Romanian banking sector[footnoteRef:18] [18: Vasile Zecheru, Marian Nastase, Management of the internal audit object. Synthesis of used theoretical and methodological procedures and applications. Economica Publishing, 2005.]

Internationally, the management of human resources is often the more important human resources are valued as the most valuable asset of a company. Human resources are unique in terms of their potential for growth and development, and the ability to know their own limits and defeat.Lately, due to the rapid development of the market, but also because of fierce competition, we face a high demand for specialists in banking activity. Starting from the demand - supply