Abstract
This report has conducted an evaluation of the issue faced by the organisation HSBC in its HR practices that has led to the emergence of various challenges such as a decline in brand image, low employee trust and motivation, and so on. The present research is based on the exploration of the HR issues in the closure of branches of HSBC in the UK. Human Relations Theory has been applied in terms of maintaining effective relationships among employees and customers. Along with this, it has focused on a deductive research approach along with pragmatism research philosophy. The study implements mixed research methods and descriptive research designs, with data collection through primary interviews and secondary research. As a part of the sampling framework for this research, it uses the convenience sampling, which is a non-probability type of sampling. For the data collection and analysis methods, the study uses interview and case study methods and thematic data analysis methods. The findings show that the closures significantly affected business, reducing employee morale, leading to lack of engagement, and so on.
Introduction/Background of the Organisation
Business management is defined as, the process of planning, organising, leading, and controlling the organisation resources, such as, people, finances, operations, to efficiently and, effectively achieve its goals. Thus, it is a discipline of overseeing and supervising the processes, operations, and the resources of a business for achieving the business objectives (Flokzu, 2026). Additionally, career development is defined as, the lifelong, proactive process of the managing the professional growth by acquiring the skills, gaining experience, and making the strategic decisions to achieve personal, and long-term career goals, involving the self-assessment, learning, networking, and adapting to the change. This report will be identifying the business management issues and will conduct a mini-research that would address the issue. The chosen business organisation is HSBC. It has recently decided to close 114 UK branches as more people started to bank online (Espiner, 2022).
HSBC Holdings plc is a British universal bank, and the financial services group. It was founded by, Thomas Sutherland, under the name, the Hongkong and Shanghai Banking Corporation Limited. Its first branch was opened in 1865 in London (HSBC, 2026). The organisation has around, 211,304 employees in the year 2024 (Macrotrends, 2025). The organisation operates through the extensive international network that spans over 66 countries, and territories, with its main presence in the Europe, Asia, North America, the Latin America, and the Middle East and North Africa. Moreover, it offers retail banking, global banking and markets, commercial banking, the wealth management, and the private banking services (Zoominfo, 2026). And in the year 2024, the company had a revenue of $65.9 billion USD (HSBC, 2025).
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Aims and Objectives and Literature Review
Aim
The aim of the research is to explore the HR issues faced by HSBC regarding closing of UK branches due to online banking and focus on functions of HR within the organisation.
Objectives
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To assess the impact of HR practices of HSBC due to the closures
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To identify the challenges faced by HSBC in terms of closing the UK branches
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To recommend strategies for overcoming the issue faced by HSBC in the UK
Literature Review
Impact of HR practices due to the closure of branches of an organisation
The closure of branches within an organisation impacts HR practices as it shifts focus from day-to-day operations to crisis management, legal compliance, and providing support to the employees. HR managers within an organisation are responsible for managing employees and business functionalities to elevate the overall sustainability of an organisation. Regarding this, Johnstone (2024) stated that HR has an impact on the closure of branches within an organisation which affects operational changes, including shift in focus and workforce planning. Relating to this, HR practices are significant in terms of retaining more employees and customers within an organisation, which restricts the closure of branches effectively. Retention of key talents as well as restructuring of an organisational function facilitates improving overall business efficacy in an efficient manner. Poor HR and management practices leads to closure of businesses and lower retention of employees within an organisation, negatively impacting the profitability. Thus, HR practices can be impacted due to the closure of branches of a business in terms of poor management of people.
Challenges faced by an organisation due to the closure of organisational branches
An organisation can face significant challenges due to the closure of organisational branches, which can be based on loss of local market intelligence, logistics, inadequate digital alternatives, and restrictions in business continuity. Closing of organisational branches of a business significantly has a negative impact on the business functionalities in terms of achieving optimum profitability. Regarding this aspect, Wang et al. (2022) opined that the closing of business branches leads to less engagement of customers, which results in less profit. In relation to this, shutting down of branches of a business leads to less engagement of customers as well as generating minimal revenue, which has been identified as a challenge. The significant challenge is based on talent gap and reduced turnover of an organisation due to the closing of branches of a business. Additionally, future sales and growth can also be negatively impacted due to the closing down of business branches within a market. Thus, the significant challenges faced by an organisation due to the closure of branches are based on lower customer engagement and reduced profitability.
Suitable recommendations for mitigating the HR issues in a business regarding the closure of branches
Based on the identified challenges, suitable recommendations are based on fostering transparent communication, streamlining business processes, and managing talent within an organisation for improving HR practices in an effective way. Enhancing business practices along with a focus on HR functions regarding managing employee well-being and fulfilling the requirements of employees helps in mitigating the issues of closing branches of an organisation. In light of this, Pougajendy et al. (2024) stated that fostering positive workplace culture and improving culture with the engagement of employees facilitates improving organisational practices. Additionally, it also helps in retaining talents along with effective customer engagement, which improves business practices effectively. Adoption of suitable recommendations, like fostering positive workplace culture along with enhanced communication, improves the retention of talent, along with an increase in business sustainability in an effective way. Thus, the effective establishment of the recommendations among the HR department helps in addressing overall issues in an effective manner regarding the closure of branches.
Theoretical Perspectives
In terms of addressing HR issues within an organisation, the concept of Human Relations Theory can be implemented in terms of managing relations among employees and customers. Maintaining effective relations among all the departments of an organisation helps in improving overall business efficacy. Based on this, Bannya et al. (2023) stated that human relation theory has been identified as a management approach emphasising the key aspects such as social factors, employee satisfaction, and informal group dynamics. The mentioned factors facilitate impacting productivity, shifting focus from tasks to people management. The establishment of the concept of the theory within an organisation facilitates improving the overall management of employees in an effective manner. Thus, implication one of the aspects, like employee satisfaction, needs to be deployed within an organisation for maintaining effective business operations in a positive manner.
Methodology
Research philosophy
Research philosophy has been identified as a fundamental belief regarding values, knowledge, and beliefs. Regarding this, Pretorius (2024) stated that the core components within the research philosophy are based on ontology, epistemology, and axiology. There are four types of research philosophy: pragmatism, interpretivism, positivism, and realism. In this research project, pragmatism has been used in order to focus on practical results, solving problems, and allows researchers to use mixed methods for conducting the research process. The main idea of pragmatism is based on a focus on practical matters, in which questions asked by people and the answers they seek are based on HR issues regarding the closure of branches of HSBC in the UK. Thus, the pragmatist research philosophy has been used in order to focus on practical matters.
Research Approach
Reproach approach is based on an overall plan or strategy for conducting a research process in an effective manner. Based on this, Ganesha and Aithal (2022) stated that the research approach is related to the plan or procedure through which data is collected, analysed, and interpreted to interpret answers regarding research questions. Regarding this, research approach possesses two types: inductive and deductive research approach. Among the mentioned approaches, the present research uses the deductive method, which is a top-down method to start with a general theory and collect specific information's in order to derive a desired conclusion. Thus, a deductive research approach has been used in order to conduct the research process on the HR issues in closure of branches of HSBC bank in the UK.
Research Methods
There are different types of research methods that can be considered while undertaking the research work. This includes qualitative, quantitative, and mixed research methods (Saunders, Lewis and Thornhill, 2023). The mixed research methods involve the combination of both qualitative and quantitative research methods to find answers to the research questions. This study uses both qualitative and quantitative types of primary and secondary data. For this reason, the study implements mixed research methods to find answers to the research questions.
Research design
The description research design aims to systematically and accurately describe a population, phenomenon, or situation. This research design is best suited to describe the qualities of a group, individual, or situation (Ghanad, 2023). Since the research involves describing a certain HR situation for HSBC bank, it will implement the descriptive research design.
Sampling Framework
As a part of the sampling framework, the research implements the Convenience Sampling methods, which are non-probability types of sampling (Golzar et al., 2022). Convenient sampling methods involve the selection of participants from the target population based on ease of accessibility. This means that the people who are selected from the target audience are the easiest to access for the researcher. The ease of accessibility can be in terms of geographical proximity, availability for the given time or situation, or the willingness of the selected participants. Convenience sampling is also known as accidental sampling, as it is a type of non-random sampling. Since the research involves the employees of the HSBC bank as the sample population, it implements the convenience sampling method. It selects one manager of the company based on the availability and ease of access of the individual. In this regard, the sample size is 1.
Data collection and analysis methods
There are different types of Data collection and analysis methods. The choice of data collection methods mainly depends on the objectives and methods of the research work. There are different types of data collection methods, such as experiments, surveys, interviews/focus groups, observation, literature reviews, and case studies. The choice of data collection methods is largely dependent on the types of data to be collected, such as primary or secondary and qualitative or quantitative data. The research uses both qualitative and quantitative data, as well as primary and secondary data, to find insights for the research questions. For this, it implements interview and case study data collection methods. To analyse the data and generate insights from the data analysis, it implements the thematic analysis method. The thematic analysis method involves identifying patterns, generating themes from a set of data and generating insights through analysis of these themes (Saunders, Lewis and Thornhill, 2023).
Timeline
Figure1: Research Timeline
(Source: Created by the learner)
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Primary and secondary research findings
Ethical Considerations
The research ensures informed consent from the participant prior to conducting the research activities. The participant in this regard is duly informed about the objective and purpose of the interview conducted. Additionally, the research also ensures that confidentiality and anonymity are maintained in this regard. Additionally, to ensure credibility and trustworthiness, the research ensures the use of authentic and relevant data and due acknowledgement of the source of the data. Additionally, the research prevents the issues of self-bias and conflict of interest (Mirza et al., 2023).
Primary Research Findings
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Questions |
Response from the Manager |
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What are the reasons and implications of closing 114 branches of HSBC? |
The contemporary business world is being influenced and shaped significantly through the process of digital transformation. Banking businesses are also going through this transformation. In recent years, banking remotely using different digital tools and technologies has become the current norm for accessing banking services. Therefore, the company is also responding to this trend by opting to close a few of its branches. This also helps the bank to carry out cost preventive measures, such as a reduction in business operational and overhead costs. I have to agree that there are other implications as well, such as the issues of potential job cuts and consequent job security and employee motivation issues. The leadership and management of the company are well aware of these consequences and are planning to carry out different preventive measures, such as the redeployment of the staff who will be affected in this process. Our HR department is prepared to undertake workforce planning and management effectively in this regard. Employees will be provided with the provisions of open communication so that any employee concerns in this regard are addressed duly. |
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Can you describe the challenges that the company may face while undertaking this process? |
Yes, I accept that there are some imminent challenges that the company need to tackle effectively. For instance, the brand image and reputation for the company may be impacted by prioritising a non-conventional way of banking and potential job loss issues. However, it is our responsibility to inform different stakeholders of the company that the change is imperative for driving innovation and modernisation of banking procedures. Another challenge that I must mention will be the challenges of workforce planning and maintaining employee motivation for the company. However, these challenges, I believe, are part of the procedures and mitigating them will ensure long-term value offerings for each and every stakeholder of the company. |
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What are the strategies for overcoming the issue faced by HSBC in this regard? |
The key strategy the company plans to undertake in this regard is communicating openly and transparently about the objective of undertaking the change. In this process, the company will be able express its efforts to drive banking innovation and support towards its employees. Through the provision of open communication, employees will be made understand the importance of this change and how affected employees will be supported through the process of redeployment. Additionally, as a part of the post-closure measures, the bank is considering providing free tablet devices to help customers in digital banking processes. |
Table 1: Primary Research Findings
(Source: Created by the learner)
Secondary findings
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Title |
Author |
Year |
Findings |
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HSBC UK: major bank announces job cuts and delays net-zero emissions targets following results – news. |
Nelson, A. |
(2025) |
As per the findings of the impact of the closure of HSBC in the UK, it has announced multiple job cuts and restructuring in the business while reducing the cost of operations. Apart from this, the initiative on cost reduction has impacted the HR practice while managing the policies of the business. It has impacted their HR system in terms of managing the business and restructuring process of the operations to ensure effective revenue in the competitive business market. |
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HSBC to close 114 UK branches as more people bank online. |
Espiner, T. |
(2022) |
One of the significant impacts on the HR practice of the organisation is that it has redeployed and displaced 100 of its staff from their employment due to the closure of the branches. Another impact on the HR practice of HSBC, considering the closure of the branches, is that they are investing in the existing branches while initiating training and development approaches to move their business to a digital process. Moreover, some of the challenges that the company have faced in their business are the increased use of online or digital banking. |
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No end to UK bank branch closures as HSBC shuts 69 more. |
Flinders, K. |
(2022) |
In terms of investigating the challenges within HSBC, considering the closure of the branches in the UK, it can be identified that another 69 branches have been shut due to the incorporation of digital channels and platforms in the digital banking scenario after the pandemic. Moreover, almost 400 employees have been affected by the closure of the bank. These are some of the challenges and issues that have been found. |
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Future of Payments Review |
Gov.uk |
(2023) |
From the findings, it can be identified that to overcome the issue related to the lower transaction due to changing behaviour of the customers, Banks can effectively improve their spending on the customers online, which helps them engage with the business. Also, introducing online channels and applications to the business can be identified as one of the effective strategies that companies can apply. It can help companies to manage their payment approaches and customer relations. |
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HSBC: UK's largest bank announces job cuts - how it might affect branch closures. |
Nelson, A. |
(2025) |
As per the findings of the source, it can be identified that one of the major restructuring approaches that the company have taken is to cut jobs in terms of reducing the cost of operations in the UK. The company is reducing the expenses of the organisation by the displacement of the senior managers and staff across the UK while improving their brand image by redeployment and maintaining transparency and effective communication. |
Table 1: Secondary Findings
(Source: Created by the learner)
Discussion and analysis
Job cut and restructuring
One of the major impacts that the HSBC have faced in their business while cutting jobs and closing the branches in the UK due to the shift of digital banking process is the displacement and restructuring of jobs. In the context of HR process and its impact on the business, closure of the UK branches has affected their employee well-being and the restructuring process in the other locations (Nelson, 2025). Apart from this, the digital transformation in the contemporary business practice is one of the effective impacts that the HR of the company have faced in their business and operations while ensuring the restructuring process of the staff and employees. Significantly, the company have redeployed and cut around 100 staff from their branches (Espiner, 2022). The changeable shift in the digital business approaches in the banks in the UK and the employees and staff in the branches has affected the HR practice. Apart from this brand image disruption and allegations on the company have made its place due to the actions that the company have made in the UK while closing branches.
Several challenges and issues
In the context of HSBC branch closure in the UK, it can be identified that the company have closed almost 114 branches across the UK, which has affected their reputation and employee retention tactics (Espiner, 2022). Apart from this, the company also faced challenges and issues in managing its business and operations due to the inconvenient approaches of the banking system. The change in the operational tactics can be identified as one of the crucial challenges that the company have faced in establishing innovation in terms of accessing revenue in business. However, some other challenges and issues have been identified caused by the closure of the branches in the UK, as HSBC did not stop their job displacement and restructuring of the employees (Flinders, 2022). Apart from this, the company also have closed another 69 branches in the UK, which affected their brand image among their loyal customers due to the shift and demand in digital or online banking process (Flinders, 2022). From the primary findings, it can be identified that the company and its HR department have faced employee motivational issues and challenges in their business and operations.
Redeployment of staff, incorporation of digital technologies and training
In terms of improving customer and banking relations, it can be identified that encouraging customers and employees to spend more time to learn digital tools and technologies in the business can be identified as one of the effective strategies (Gov.uk, 2023). As per the primary findings and secondary research, it can be identified that offering appropriate training and restructuring staff within the employees as per their skills and knowledge can be identified as one of the effective strategies that the company have used in their business and operations. It can help them ensure the flow of cash and improve organisational efficiency while reducing the issues related to brand image that arise due to the closure of 114 branches across the UK (Espiner, 2022). Another suggestion that can be used to improve the state of the company and manage their customer and employee relations while managing restructuration and redeployment of the staff is ensuring transparency. Maintaining appropriate and transparent communications in the business can be identified as one of the effective strategies to improve employee motivation due to the shift to a digital banking process to manage cash flow.
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Key Recommendations
Here are key recommendations for managing the large-scale branch closures and the shift to the digital banking, based on the above analysis of the issues, faced by institutions, HSBC. These recommendations would be focus on mitigating the impact on employees, and the maintaining business continuity, and the morale during the transition to digital operations:
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Prioritise Clear, transparent communication and motivating the employees - This would be including the establishing a clear communication plan. The organisation is needed to provide staff with frank, timely, and consistent information about the reasons for closures, the criteria for selection, and the overall timeline of the process. HSBC must avoid ambiguity and build trust among the employees. Transparent communication often fosters trust by providing the employees with a deep and clear sense of understanding, of the decisions and, the goals of the organisation (HR Vision, 2026). Clear communication helps, manage the employee expectations and maintain trust, which would motivate the employees and, which is essential to minimise resistance to change. Providing a single source of truth, often helps in improving the employee relation. Utilising a dedicated internal communications hub or website where employees, can access the accurate information and have their questions answered, which would help in reducing reliance on rumours.
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Implement Fair and Compassionate Redundancy Processes - The organisation can ensure legal compliance, by adhering to strictly to all legal obligations and the regulations related to redundancy. This would help in ensuring the process, are unbiased and free from the discrimination to avoid the potential legal issues. It might also offer, a comprehensive support packages, for affected employees, along with providing the extensive support beyond just the severance pay. This should include, access to the counselling services, career coaching, and outplacement services to help them explore new career avenues. These activities can be considered to be essential because HR practitioners must be prepared and equipped with the right and effective strategic capabilities and the strengths which would help, them in effectively implementing redundancies in the organisation (Stevens, 2022).
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Focus on Reskilling and Redeployment - For this, the business organisation is needed to identify the internal opportunities. This would include actively seeking redeployment opportunities within the bank, growing digital, the wealth management, or/ the other priority areas, such as, in Asia/Middle East operations for HSBC. Moreover, a digital transformation is one of the biggest challenges that the organisations/ and companies face during the technological transformation. Hence, without reskilling, and upskilling, the business organisations, face a clear disadvantage while competing in the business industry with the other larger companies (Istenič et al., 2022). Thus, investing in the robust training programs, would help in reskilling of the employees. Developing the customised, and the effective upskilling programs to equip the employees, with the new skills needed for modern banking, particularly in data analytics, AI, and the digital customer service.
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Address the Impact on Remaining Employees and improving the brand image: This would include managing the employee workloads, by being mindful of the potential for increased workloads and stress on remaining staff after closures. HSBC is also needed to ensure an appropriate staffing levels for prevent employee burnout. Another one of the practices that the organisation is needed to ensure is the maintenance of the employee morale and the engagement. It would have to reassure the remaining employees, about the future stability of the organisation; engaging them in discussions about future strategies, and recognise their contributions, during challenging times to foster a culture of collaboration and motivation. Moreover, by effectively implementing these, the company can, improve its brand image, which was lost due to the business issue.
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Adopt a Strategic HR Role: The company can work effectively on elevating the HR function to a strategic business partner role, along with, integrating people systems with the overall business strategies to manage change effectively. The lining of the HRM with the strategic objective, and the goals for improving the performance of the business, helps in fostering an environment of innovation, and flexibility (Kumar et al., 2024). Leveraging the data and analytics might, turn out to be an effective strategy in this context. The business organisation can use data-driven insights for managing the talent, succession the planning, and career development more effectively, along with, ensuring that the right, are in the right roles. The standardise and revitalise HR policies, would help in continuously reviewing and updating the HR policies, for aligning them with the bank evolving needs in the digital era.
Conclusion
In conclusion, this report has effectively identified the business management issues in the banking company HSBC. The company faces the major issue in its HR department, due to which it faced a major challenge. For the conducting of this mini-research, a interview was conducted with one of the managers of the branches to gather a more in-depth, and through understanding of the issue as the primary resource of the report. Moreover, this report has utilised a set of primary and secondary sources for the completion of this report. Additionally, based on the mini research, certain recommendations have been provided that would help HSBC in improve its HR practices. By implementing these recommendations, the organisation, HSBC, can navigate the challenges of the branch closures more smoothly, along with, demonstrating a commitment to its employees, while, adapting to the changing landscape of the banking industry.
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