PRODUCTIVITY IMPROVEMENT OF THE COLLECTION OF CONSUMER CREDIT AT BANK KEMBANG MELATI

• Main Author: YUSUFI (NIM 29114532), MUQLAZH
• Format: Theses
• Language: Indonesia
• Online Access: https://digilib.itb.ac.id/gdl/view/29401
• Institution: Institut Teknologi Bandung

Management of human capital is a very important aspect in the continuity of an organization. In managing the individuals within an organization, there is a lot of matters to be considered. Three primary facets that must be emphasized is the development of knowledge, skills, and attitude of the employees. These three factors may influence the level of productivity of employees in a company, including the consumer credit collection function at Bank Kembang Melati (‘Bank’). <br /> <br /> Currently the Bank is facing a challenging financial condition, whereby n 2016, the Bank incurred a Net Loss of IDR 6.48 Tn in 2016, due to many loans are being written off, as shown by increase in Impairment Loss to IDR 12.21 Tn from IDR 3.68 Tn in 2015. As a result, asset size also decreased to IDR 94.78 Tn in 2016 from IDR 125.87 Tn in 2015. This condition increased the importance of safeguarding the quality of assets, which also include such consumer loans as the credit cards, personal loans, and the mortgage loans. This in turn heightened the importance of the function of consumer credit collection in mitigating credit risk. Alas, the productivity of the employees within the function shows a decreasing trend, shown by lowering Account Collectible Ratio (ACR), that is the number of accounts that are being worked by each collection agent. This increased the need of more collection agents for the same number of accounts. This issue potentially increased operational cost, one aspect that is being particularly watched in a distress financial condition currently overwhelming the Bank. <br /> <br /> To tackle the issue of lowering productivity, a conceptual framework has been developed, starting from observations of the existing business process in the functions to find potential root causes of the issue being faced, using the Fish Bone Diagram initially developed by Karou Ishikawa to resolve the problems found in a manufacturing industry. Based on the diagram that has been adapted to the work environment in the collection function at the Bank, four crucial factors have been identified, namely ‘People’, ‘Process’, ‘Technology’, and ‘External Environment’. These four factors become the base for the independent variables to tackle the productivity issue as the dependent variable. In addition, other subjects as leadership, work environment, and motivation have also been used as the moderating variables, which are in turn being researched to find the condition of these other variables in the work environment. Subsequent analysis was then made based on the observations as well as the research results to formulate solutions to resolve the productivity issue being faced. Implementations of these solutions are then tabled into a specific time table for three years forward. It is hoped that implementations of these solutions can improve the employee productivity in the consumer credit collection function at Bank Kembang Melati.