The Islamic Development Bank

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Most, if not all, businesses and organizations have a vision, which is a series of objectives or simply a single aim of where the organization wants to be in the future or over the next few years. Missions are subordinate to ideas, although in this case, the latter is a shorter goal, in other words, it is what the organization is doing (Islam, 2017). Well, both a vision and a mission are essentially useless unless they are guided by a strategic strategy (Abduallah & Hassan, 2007). Islamic development banks are similar in that they have a clear vision and a mission that is bound by a well-defined strategy (Abduallah & Hassan, 2007). The aim of Islamic Development Bank (IDB) is to become a world-class development bank inspired by Islam laws, which will help transform the landscape of human development in the Muslim world and as a result, restore the Muslim dignity as a whole (Abduallah & Hassan, 2007). The mission, on the other hand, aims to promote comprehensive human development with the focus point, being on priority areas of alleviating poverty, improving health, promotion of education, improving governance and finally the guiding of people to prosperity (Haniffa & Hudaib, 2007).

The strategies are quite broad hence not much will be taken into depth about them apart from a brief if not a general outlook of them. The strategies are as follows; reforms of the IDB, the eradication of poverty, promotion of health and globalization of education (Amin & Isa, 2008). Also, there is the guiding of people to prosperity, the empowering of the sisters of Islam, the expansion of the financial industry, and finally the facilitation of an integration of the Islamic development members, into the country economics and also among themselves with the global world (Islam, 2017). By reforming the IDB, the bank aims to be able to meet the demand brought about by its growth and also in a more efficient way allow focus to be on the priorities and commitments of the bank as per the vision and mission statement (Amin & Isa, 2008). As for strategy two-poverty eradication, it's perhaps the greater challenge, as poverty connects illiteracy, diseases, crime, and instability, the vision statement of IDB aims to regain the dignity of Muslims but with poverty still as an endless migraine, makes the whole initiative significantly harder (Dusuki, 2007). Nevertheless, the eradication of poverty will be combated by the globalization of quality education as it will provide better and equal opportunities; which will also help the people prosper as it is a push in the right direction (Amin & Isa, 2008). Woman are regarded as the soul of the family hence, empowering of the sisters of Islam is not only a great endeavor but also recognition of their importance in the society (Dusuki, 2007). The last two strategies aim to manifest development of the people in not only the country affairs but also globally by expounding on the opportunities available to each and every citizen (Amin & Isa, 2008).

The Islamic development bank implements the management and leadership performance culture at both the institutional and individual level. The bank achieves this by use of annual development effectiveness reports, which show a description of the composite factors that underpin institutional performance (Arthur, 2008). They are in control of an organizational structure that monitors the composite indicators; through this, the bank can carry out very rigorous performance management systems at both the individual and staff levels (Arthur, 2008). The information from the performance management reports is used to link financial benefits, career progression, and recognition of the performance at the institutional level, which is ultimately known as performance appraisals (Amin & Isa, 2008). In spite of the mission and vision statements been widely accepted by the human resource staff, the organization still manages to place more and more emphasis on performance, empowerment, and accountability. As an organization with thriving employees is a productive team (Amin & Isa, 2008). The bank recently shifted its human resource policies from compliance to performance (Chapra & Al-shaikh, 2008). The move was significant as compliance was not meeting the target as per required hence performance; that see a reflection in not only, the retention policies but also, the development and the recruitment procedure (Amin & Isa, 2008). To ensure the effectiveness of the systems in place, they are monitored through periodic employee surveys that enable the staff to air their voices which are taken heed by senior management and factored in, as actionable enhancements hence, fostering a culture of empowerment and productivity.

The Islamic development bank also does not fail to recognize the mobility of talent and specialized expertise, in fact, they are accommodated in the human resource policies and action plans (Chapra & Al-shaikh, 2008). Through this, the bank can ensure the recruitment of suitable talent and also facilitates their development through coaching and training and retraining (Dusuki, 2007). The talented and capable are to some extent retained through the use of benchmarking and review of the rewards systems both internally and externally, so as to ensure they up to par with their competitors, and where the need arises changes are made to adapt to the current events.

Aligning strategy and performance management via human resource is a productive initiative of which many organizations fail to wholly or successfully implement. It is quite prudent to elaborate on the meaning of the two before developing the mantra of the subject. Strategic human resource management focuses on choosing from a selection of human resource actions in pursuit of the organization's strategic objectives (Perera & Baird, 2011). On the other performance management is a continuous process that facilitates the developing and appreciation of employees to foster productivity and also meet the goals of the organization. Aligning the two is perhaps not as difficult as it is presumed (Perera & Baird, 2011). As the ultimate strategic goal of human resource entails having a bunch of human resource practices, that acquire, develop and motivate competencies in a supportive and consistent manner. The question is, does the Islamic development bank have the two functions aligned? To some extent, it would be fair to agree they do, as, in the strategic plan on performance, the bank manages to align performance to the strategy map, with the outlook and culture been in the center on performance.

On the downside, it is not that clear how the bank has aligned the two human resource management practices as there is not so much viable information. The strategies focus points towards the vision and mission statements (Becker & Gerhart, 2008). Despite Islamic development bank falling short, there are possible remedies or better solutions that can be triggered to ensure the two management functions are in complete alignment. To start with an understanding of the conditions required for the two to be aligned is perhaps the first road to take (Becker & Gerhart, 2008). Alignment of the two requires that the human resource practices to have an aligned set, which is both vertical and horizontal. That is perpendicular drives performance competencies and the horizontal measures the human resource practices so that they are both mutually supportive and reinforcing.

Alignment of the two or better known as human resource alignment analysis has subsequent follow through as the horizontal and vertical are the final steps a whole review has to be carried out for any organization inclusive of IDB for them to have a fully aligned strategic and performance management (Becker & Gerhart, 2008). It is perhaps not wrong to say the alignment is not for the faint-hearted rather; it is for those who understand the full magnitude of the human resource system as a primary driver of performance and competency improvement (Becker & Gerhart, 2008). The whole analysis requires commitment towards tiresome and lengthy analysis followed by a change in human resource practices and systems. The appropriate report considers performance as a factor at some point more elements might be needed to be inclusive.

Islamic development bank is perhaps at a much greater height in comparisons to its peers, with a unique mission and vision that rather than focusing on increased profits it has chosen to better the society with strategic aims proving its greatness in the Middle Eastern frontier.


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Arthur, J. B. (2008). Effects of human resource systems on manufacturing performance and turnover. Academy of Management Journal, 37(3), 670-687.

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Chapra, M. U., Khan, S., & Al Shaikh-Ali, A. (2008). The Islamic vision of development in the light of maqasid al-Shariah (Vol. 15). Iiit

Haniffa, R., & Hudaib, M. (2007). Exploring the ethical identity of Islamic banks via communication in annual reports. Journal of Business Ethics, 76(1), 97-116.

Islam, M. S. (2017). The performance of rural development scheme in Islami Bank Bangladesh from an Islamic perspective. Journal of Islamic Economics and Finance, 5(1). doi:10.22373/share.v5i1.912

Dusuki, A. W. (2007). The ideal of Islamic banking: A survey of stakeholders’ perceptions. Review of Islamic Economics, 11(3), 1-32.

Perera, S., & Baird, K. (2011). An analytical framework to examine changes in performance measurement systems within the banking sector. Australasian Accounting, Business and Finance Journal, 5(1), 93-115.

May 24, 2023

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