“Performance Management System via Balance Scorecard at South Eastern Coalfields LTD”
Table of Contents
Description
Page No.
Acknowledgement
4
Executive Summary
5
Chapter 1: Introduction
1.1 Performance management system
6
1.2 Introduction to Balanced Scorecard
7
1.3 Four perspective of Balance Scorecard
7
Chapter 2: Company Profile
22-27
Chapter 3: Review of literature
28
Chapter 4: Research methodology
30-32
Chapter 5 : Analysis and interpretation
34-47
Chapter 6: Summary of Conclusion, Finding & suggestion
48-49
Bibliography
50
Questionnaire
51
ACKNOWLEDGEMENT
I thank God for this opportunity and would like to express my immense gratitude to my project guide Dr.K.Lavanya Latha, Assistant Professor, Department of Management Studies, for her kind co-operation and guidance which enabled me to complete this project. I express my sincere thanks to Dr. T. Nambirajan, Head of the Department, Department of Management Studies, School of Management, Pondicherry University, who provided me an opportunity to do this project. I am deeply obliged to my External Guide Miss Minu Sinha, Asst. Manager (HR), SECL for his exemplary guidance and support for this project. Also I extend my deep sense of gratitude to my friends and colleagues for their valuable suggestions and timely help in completing this project.
Thakur Prasad Singh
EXECUTIVE SUMMARY
Balanced Scorecard is a concept for measuring a company’s activities in terms of its vision and strategies, to give managers a comprehensive view of the performance of a business. It has also been helpful as a basis for providing incentives, performance appraisal etc. Coal India Ltd. has taken an initiative to implement Balanced Scorecard in the organization. The problem in this case was to study the implementation of BSC in the organization, how it compares with the procedure set by Norton and Kaplan (the fathers of BSC) and the need for BSC in the organization. As the company is implementing it for the first time in the organization hence, we need to know how BSC has been implementing in the organization so as to judge its importance and contribution to the organization.
The company is going through the phase of Goal setting process of performance management system so it is necessary to have a thorough study of Goal setting process and take a feedback from the employees regarding the whole performance management system. Secondly, a deep understanding of the BSC adopted by the private sector and public sector so the difference between effectiveness can be concluded.
The tool adopted was a questionnaire. A survey of 13 questions was formulated to cover the areas of awareness about BSC among employees, perception of employees with regard to BSC and awareness of employees about Goal setting process. The responses were then analyzed for each question and conclusions were draws.
CHAPTER- 01
1. INTRODUCTION
The growth and stability of an organization mostly depends on the speed, innovation, quality and customer satisfaction. The culture of the competition among the organizations has shifted from tangible assets to intangible ones. Most of the organizations are now focusing on human capital and its alignment with the overall strategy of the organizations. Human resource is one of the most important and powerful factor for the development and continual progress of an organization. The entire system of measuring HR’s contribution to the organization’s success as well as the architecture of the HR system needs to change to reflect the demands of succeeding on the new economy. 1.1 Performance management system:
According to Armstrong and Barron (1998) “it is a strategic and integrated approach to increase the effectiveness of the companies by improving the performance of the people who work in them and by developing the capabilities of team and individual contributors.”
Performance management system is the process that includes activities which ensures that targets of the organizations are fulfilled with an efficient and effective manner. It is the alignment of resources, systems and their employees of an organization to strategic objective and priorities. The objective of Performance management system is to:
Ensure that the employee understands the target of the organization as a whole, and that of the department and the specific unit/section Set the employee’s target and assess how the employee has performed against the defined target Provide feedback to the employee to ensure that he/she understands his/her performance Reward employee for the performance
As stated above performance management is both strategic and integrated approach it includes the following actions: Development of clear job description for all employees as well as employee performance plans which includes Key result areas (KRA) and Key performance indicators (KPI). Selection of right set of people by implementing an appropriate selection process. Negotiating requirements and performance standards for measuring the outcomes and overall productivity against the predefined benchmarks. Providing feedback and guidance throughout the period of delivery of performance. Identifying the training and development needs by measuring the outcomes achieved against the set standards and implementing effective development programs for improvement. Holding quarterly performance development discussions and evaluating employee performance on the basis of performance plans.
Designing effective compensation and reward systems for recognizing those employees who excel in their jobs by achieving the set standards in accordance with the performance plans or rather exceed the performance benchmarks. Providing promotional and career development support and the guidance to the employees Performing exit interviews for understanding the cause of employee discontentment and thereafter exit from the organization. 1.2 Introduction to Balanced scorecard
Balanced scorecard is the performance management system that helps organizations to implement its vision and strategy into action. The system provides feedback on internal business processes and external business outcomes to continually improve the performance of the organization. The system introduced for the enhancement of performance of employee, department, and unit with respect to the whole organization. According to Kalpan and Nortan (1996), “the balance scorecard translates an organization’s mission and strategy into a comprehensive set of performance measures that provides framework for a strategic measurement and management system.” History:
The balance scorecard was first developed by Robert Kalpan and David Nortan in an article to Harvard business review in 1992. The article was based on a multi- company research project to study the performance management in companies whose intangible asset plays an important role in value creation.
According to Nortan & Kalpan if the companies want to improve the management of their intangible assets, they have to integrate the measurement of intangible assets into their management system. The study was conducted to explore the new methods of performance measurement. The importance of the study was a growing belief that financial measures of performance were ineffective for the modern business enterprise. A number of representatives of various companies participated in the discussion along with Robert Kalpan & David Nortan. The outcome of the discussion was convincing that reliance on financial measure of performance had an effect on their ability to create value. The group discussed on number of alternatives and finally reached on an idea of scorecard, featuring performance measure capturing activities from throughout the organization. The activities included:
Customer issues
Internal business processes
Employee activities
Shareholder concern
Kalpan & Nortan then later introduced Balance Scorecard the new tool for the performance measurement and summarized the concept in the first of three articles “Harvard business review articles” “The Balance Scorecard- measures that drive performance.” After publication of 1992 HBR article, a number of organizations quickly adopted The Balance scorecard giving its deeper and broader insights into its power and potential. After 15 years of its introduction, the concept was adopted by thousands of private, public, and non-profit organization around the globe, later the concept broadened into a management tool for describing, communicating and implementing strategy.
Figure 1.1 Balance Scorecard historical ‘Family tree’
So, basically balanced scorecard is a tool that transforms and deploys organizational strategy into performance. Kalpan & Nortan positioned the balance scorecard as a tool for the organizations to manage the demands of relevant stakeholders and to translate strategies into action. Possible stakeholders that are strategically relevant could be shareholders, customers and employees. Their demands are integrated into core management
of companies within a “financial”, “customer”, or “learning” or “process” perspective. Balance scorecard provides a balanced view of organization’s performance strategy across the four perspectives namely: Financial perspective
Customer perspective
Internal business process
Learning and growth
Each perspective has its own relevant strategic goals, indicators and measures to achieve them. Strategies can be usually interpreted as a set of hypotheses of cause & effects. So within a BSC the relevant goals and corresponding indicators are linked to each other revealing this structure of causal relationships. Such relationships are both relevant within each perspective and also between them. Objective of the “learning” perspective, for instance, serves as ‘enablers’ for the achievement of goals of other ‘overarching’ perspectives (e.g. Customer, finance etc.). 1.3Four perspectives of BSC:
01. The Financial Perspective: it summarizes the readily measurable economic consequences of actions already taken. The perspective takes into account the traditional way of valuing the business. Metrics based on this perspective could also include measures such as operating income, return on capital employed, economic value added, financial ratios and various cash flow measures etc. 02. The customer perspective: contains measures that “identify the customer and market segments in which the business unit will compete and the measures of the business unit’s performance in these targeted segments”. It emphasizes on the increasing realization of the importance of customer satisfaction in business. If customers are not satisfied, they can eventually move to or find other suppliers that will meet their needs and in turn impact business. 03. Internal business process: measures the “critical internal processes in which the organization must excel”. Metrics based on this perspective allow the managers to know how well their business is running, and weather its products and services conform to customer requirements. 04. Learning and growth: measures the “infrastructure that the organization must build to create long-term growth
and improvement”. This perspective includes employee training and organization’s cultural attitude related to both individual and organization’s self-improvement.
Figure 1.2 four perspectives of Balanced Scorecard
Financial Perspective
To succeed financially, How should we appear to our shareholders? Examples of this perspective include financial ratios and various cash flow Measures.
Customer perspective
To achieve our Vision, how should we appear to our customers? Examples of this perspective include the amount of time spent on customer calls And customer survey data. Internal business process
To satisfy our shareholders and customers, what business processes Must we excel at? The internal business processes that are often classified a mission Oriented and support oriented. Examples of this perspective include the length of time spent prospecting and the amount of rework Required.
Learning & Growth
to achieve our vision, how will we sustain our ability to change and improve? Includes employee training And organizational attitudes related to both employee and organizational improvement. Examples of this perspective include the amount of revenue that comes from new ideas and measures of the types and length of time spent training staff.
Figure 1.3 Balanced Scorecard Framework
What does a balance card do?
It aligns & Cascades organization’s targets to departments and individuals. Drives performance culture
Sets performance goals
Clarifies “Targets” and assesses employees against those targets. Builds a
performance based culture.
Recognize talent and their achievements for corporate success Establish direct linkage of performance and rewards
Helps in identification of individual development needs and initiation of specific actions required to improve individual’s performance. This ‘balanced’ framework enables a management team to execute the following four strategic management processes: Clarify and translate vision and strategy.
Communicate and link strategic objectives and measures.
Plan, set targets, and align strategic initiatives.
Enhance strategic feedback and learning.
Implementation of BSC:
The Balanced Scorecard is a management system (not only a measurement system) that enables organizations to clarify their vision and strategy and translate them into action. It provides feedback around both the internal business processes and external outcomes in order to continuously improve strategic performance and results. When fully deployed, the balanced scorecard transforms strategic planning from an academic exercise into the nerve center of an enterprise.
So what prompted SECL as an organization to adopt BSC?
This happened because SECL understood, with acumen, the following:
While working, in general, trend is towards focusing on today only. BSC is a strategy map for balancing Today and Tomorrow.
Integrates the immediate & future: Set targets, measure and reward. At same time, orients one towards the future desired state of affairs, as set by management Setting targets involves all concerned. Fosters team spirit and group motivation. In the majority of cases the real problem isn’t bad strategy- it’s bad execution. As per Fortune magazine, Less than 10 percent of strategies effectively formulated are effectively executed. The company wanted to bridge the gap between the Vision-Mission-Strategy and the everyday actions of its employees.
Reasons for adoption:
Financial results report past performance but do not adequately drive future performance. No single measure is appropriate.
Strategic objectives must be translated into linked sets of measures so that they can be communicated and implemented.
Principles for Implementation (Long-Term for CIL)
Establish a sense of urgency.
Build an Executive leadership team to mobilize change.
Develop the Vision and Strategy.
Translate the Strategy into Operational Terms. The BSC operationalizes Strategy into Targets. Link and align the Organization around its strategy.
Make strategy everyone’s job – communication & education for awareness, personal alignment, Incentive Compensation. Link strategy and budgeting.
Make Strategy/BSC a Continuous Process.
Coal India has undertaken the initiative to implement the Balance Scorecard based Performance Management System to enhance fairness, transparency and inculcate a culture of meritocracy in the organization. The revamp of the existing Performance Management system is also aimed to act as an input to other HR systems like Performance Related Pay (in accordance with the guidelines issued by DPE), Training and Development, Career Planning and Rewards & Recognition. The rating and score of the new Performance Management system would formulate the basis for promotion and performance related pay. In order to create and launch the new system, CIL partnered with a global HR Advisory firm Right Management India
The project was conducted in three critical phases:
01. Diagnostic phase- Detailed “as-is” study of the existing system 02. Design phase- Creation of unique position list, KPI inventory, Scorecards, PMS manual and form 03. Implementation phase- Pilot implementation, train the trainer programs and troubleshooting.
PMS form has been given the nomenclature of PRIDE which stands for Performance Report for Individual Development of Executive. Implementation of Balance scorecard is adapted with the PRIDE form, in which targets and KPI’s are recorded for the executives. The overall process of the Balance scorecard based performance management system is as follows:
The whole process of PMS is divided into four important stages:
Target setting
First half year review
Final review
Final rating and moderation
Figure 1.4 Performance management cycle
The performance management cycle consist of four stages, which are as follows:
Target setting: Target setting is the first stage of performance mangement cycle in which clear and measurable standards of perfprmance are set for employees in the organization. The duration for the execution of target setting was 30 from 1st of April to 30th of April. Review: The second stage of the process
First half year review: first half year of review is held to access the progress of performance till half year against the set target. This session aims to provide feedback to enable employees to understand what he/she is doing well, and what he/she needs to do differently. No rating is provided in this stage. The duration of the process will be 1st of October to 30th of October.
Final review: Final Review is to be held during the end of Appraisal cycle to review and discuss the extent of employee’s achievements has been obtained against agreed targets. Each employee provides a rating to his/her own performance. This is followed by rating provided Reporting and Accepting
officer. Assessment would also be done on “Personal Attributes “and “Special Achievements” by Reporting and Accepting officer. Feedback would also be provided on the developmental needs.
Feedback and Developmental Planning: During the Final Review process the supervisor will discuss employee’s strengths and Areas of Development based on his / her observations during the year and seek the employee’s self-assessment.
Figure 1.5 Performance cycle
As it is mentioned that the implementation of BSC is new to the organization, the company was going through the initial stage of PMS that is goal setting process for executives, and that includes the following activities: Take participate in the camps organized especially for the employees of executive level. Visits to various units and their department to distribute the PMS manual and scorecards Participate in the executive meetings held for the implementation of performance management system Collection of scorecards of different units and preparation of stable data in the sheets Personal discussion with the employees and take feedback on goal setting process
Target Setting – is one of the most crucial stages of Performance Management System. In these stage clear and measurable standards of performance has been set for the entire organization. As part of the “Design phase” of the program, KPI’s and rating scale has been set for the entire organization. Against these defined KPI, the officer needs to set the target post discussion with his/her the Reporting officer for the year.
Definition of “KPI” and “KRA”
KRA (Key Result Areas): KRA is the selective areas of job, in which a high level of performance is required. Key areas related to production and development of the organization is set against which each employee has to perform for better improvement.
KPI (Key Performance Indicator): it is the identification of the reasons that would indicate the performance.
Rating scale: Clearly defines level of performance which would determine the performance rating varying from 1 to 5
Illustration with KRA of Cost control:
EXHIBIT 1.1
KRA
KPI
Rating Scale
Cost Control
Penalties and fine index
Rating scale to be adhered is as follows :
5- If number of cases imposed is zero
4- If number of cases imposed is between 1-2
3- If number of cases imposed is between 3-5
2- If number of cases imposed is between 5-7
1- If number of cases imposed is greater than 7
Number of KPI’s is dependent upon various factors like:
•Span of Control (Determined from the number of positions that are directly reporting to the to the position under consideration) •Span of Accountability (Determined from the organizational hierarchy at which the position under consideration is located in the organization structure) •Span of Support (Determined from the degree to which interdepartmental alignment & support is necessary for the position under consideration to execute his or her work assignment) •Span of Influence (Determined from the decision making authority that has been delegated to the position under consideration)
Figure 1.6 Sample form for Goal setting
In the process of goal setting all the employees at officer level up to grade
E7 (including E7 level) are included for evaluation under the new PMS. Only those officers who are in a permanent roll in the organization are eligible for evaluation under the new PMS. Thereby, employees on contract/part time employees are not entitled for review under the new PMS. Eligibility for PMS evaluation and PRP has been set on the basis of terms and conditions of deputation.
Distribution of PRIDE form:
PRIDE Form is distributed by EE Cell of respective Subsidiary/establishment to the Nominated officers. Nominated officer plays a pivotal role in managing the PMS Process. They are notified by the subsidiary/CIL HQ for respective Unit, Project, Area and Subsidiary HQ/CIL HQ as the case may be. He/she maintains a status of the current state of PMS Forms i.e. how many have been appraised and how many are still due for appraisal. For better understanding of PMS among the executives several camps were organized where the nominated officer illustrated the complete procedure of PMS and about PRIDE forms i.e. – How to fill the form?
– To whom it to submit after filling the form?
– How the ratings for the performance will be given?
– What are the KPI’s?
After distribution of the PRIDE form to the executives, a small demonstration has been given to executives for filling the PRIDE form and a doubt clearing session organized to clear the queries. Executives have been given a time period of 15 days to complete the first process of goal setting by discussing the various relevant KPI in the respective scorecards. After finalization of KPI for the assessment year, the PRIDE form was submitted back to the Nominated Officer, who would return the same back for mid-way evaluation in October. Thus, a Nominated Officer is basically the custodian of all the forms in an area and also the coordinator for the whole process. The Goal setting process is the most crucial stage, wherein all the later stages of evaluation and developmental activities would depend on.
Reporting and Accepting officer are the appraisers for the PMS form. The levels are as follows:
EXHIBIT 1.2
For officers posted in Mining Department
Reporting Authority is the Controlling officer
Accepting Authority is Reporting Head of Controlling officer
For officers posted in non-Mining Department
Reporting Authority is the Controlling officer
Accepting Authority is the Head of Function of the concerned Officer
For employees based in Unit, the Reporting Authority is Colliery Manager For employees based in Project, the Reporting Authority is Project Officer For employees based in Area,
For Staff Officers, the Reporting Authority is Area General Manager For employees under Staff Officer, the Reporting Authority is Staff Officer
Some special cases raised on filling the PRIDE form during discussion and meetings on PMS process, employees raised some of the key questions on implementation of BSC and the procedure of rating in the scorecard, I have included some of the queries of executives as part of my assignment of project of goal setting process, which is mention below:
In case of transfer in an Assessment Year, the assessment made in his last assignment and the period is four months or more, the same shall be treated as final rating. In the assessment year, if the period of assessment is more than nine months, such rating will be considered final for the whole year, and no further assessment is required for the period of less than three months. The rating of the officer, if he is injured on duty, calculated
equivalent to the average rating of the previous three years rating of the Company, and this will be only for promotion purpose. Officer would not be entitled to PRP for the said period officers who are retiring are entitled to PRIDE Form Review and to a prorated PRP payout In case an officer has voluntarily resigned from the organization and has spent less than six (6) months of the assessment period in the organization, he/she would not be entitled to PRIDE Form Review and prorated PRP payout. However, if the officer has voluntarily resigned from the organization and has spent more than six months of the assessment period, he/she would be entitled to PRIDE Form Review. The PRP payout would be calculated on a pro-rata basis i.e. from the commencement of the Assessment year to the last working day of the concerned officer. Dismissed officers under vigilance cases has not entitled for PMS evaluation and PRP Officers under vigilance cases would not be entitled for PMS evaluation and PRP till the time a final decision is declared In case an officer is handling 2-3 roles, the officer needs to refer to the scorecards of all the unique positions that he/she is handling and take relevant KPIs from all of them post discussion with Reporting Officer.
Comparing the Balance Scorecard between private & public sectors:
Performance management system in different organization like private organization and public sector firms are different in many perspectives, as part of my assignment I have asked to study PMS of different private and public sector firms and compare it with the existing PMS of Coal India. Using the same performance metrics in the public sector as the private sector is likely to be ineffective since public sector goals differ drastically from those of the private sector. Private sector focus is primarily on shareholder value: the bottom line. Funding comes from various sources, and as long as shareholder financial needs are met, the company can function as it pleases. The public sector faces a quite different environment. Public sector funding comes, in most cases, from the tax payers it is servicing. The measure of success is not shareholder value or profit but rather how well the agency is meeting the mission given to them by congressional statute or executive order. Although the agency can oftentimes
perform this mission in whatever way it sees fit, it is still bound by the directive of the mission. Thus, strategic value comes in the form of fulfilling the mission, and fulfilling the mission comes down to customer satisfaction with the agency’s service. However, defining customer needs is a bit more complex. A second difference evolves through the number of customers or stakeholders that a public sector organization must serve. Financial measures in the BSC relate to financial performance, which is a means to satisfy investors (shareholders, investment firms, bondholders). In the public sector organization, the financial measures are just part of what is needed to please the “investors,” which in this case would be the funding agencies. While private sector clients are not concerned with an organization’s internal efficiency so long as their product, price, and service needs are met, internal efficiency is of great concern to the public sector’s stakeholders, who are also its source of funding taxpayers also require accountability that their tax are being used effectively and efficiently. Therefore, program performance, efficient use of resources, and satisfaction with the service by the public are additional key issues. These differences lead to a different sort of hierarchical model for the balanced scorecard, as increasing shareholder wealth does not have primacy in a governmental operation, financial performance becomes less critical.
EXHIBIT 1.3
Features
Private Sector
Public Sector
Focus
Shareholder
Value
Mission
effectiveness
Financial goals
Profit; market
share growth;
innovation; creativity
Cost reduction;
efficiency; accountability
to the public
Efficiency concerns
of clients
No
Yes
Desired outcome
Customer satisfaction
Stakeholder satisfaction
Stakeholders
Stockholders;
Bondholders
taxpayers; legislators;
inspectors
Who defines
budget priorities
Customer
Demand
Leadership; legislators;
funding
agencies
Key success
factors
Uniqueness;
advanced
technology
Sameness; economies
of scale; standardized
technology
Some public sector balanced scorecard advocates have put financial measures at the bottom of the model to indicate the importance of having adequate funding as a precursor to developing the organization, However, to be consistent with usage in the private sector, we look at financial measures as output measures that are precursors to meeting the mission, which will in
the end lead to adequate future funding. Internal process management would be similar for government and for profit-seeking enterprises as both relate to the key value-added processes that the organization provides. The Balanced Scorecard can be effective in the public, if and only if, the current perspectives are rearranged. The four perspectives of the current version of the Balanced Scorecard can still be applied in government organizations as long as they are rearranged according to governmental priorities. Therefore, it is clear that above considerations seem to have considerable impact on the ability of the Balanced Scorecard in ensuring best customer satisfaction. These considerations, if positively dealt with, may contribute to employee satisfaction, superior employee performance, sound internal business process and in turn, may lead to efficient stewardship of taxpayers’ money.
Some of the facts which are especially important for adoption of the Balanced Scorecard approach in public sector are: • The closeness to political interests needs a special thoughtfulness and sensibility. • It is important to explain employees and representatives the Balanced Scorecard’s usefulness.
The implementation of a Balanced Scorecard requires an effective controlling system which assembles measures, values and other significant reporting data. Public sector still needs to catch up here. Accordingly from the beginning this should be allowed for. • A balance between a tight schedule and adequate time for practice, communication and feedback during strategy discussion has to be found. To keep motivation high the rollout should be kept short. Adoption needs dynamics, especially in the Public Sector.
CHAPTER- 02
2. Profile of the company:
Coal India Limited (CIL) – a Schedule ‘A’ ‘Maharatna’ Public Sector Undertaking under Ministry of Coal, Government of India is the largest coal producer in the world with core competence across the entire gamut of coal business value chain starting from exploration, planning & designing, operation, beneficiation and marketing. Coal India limited has its head quarter in Kolkata, West Bengal. With a coal production of over 431.32
Million Tones (2010-11), CIL is far ahead of its nearest international rivals like China and USA whose production is in the range of 210 million tones and plays an indelible role in India’s energy canvas. It produces non-coking coal and coking coal of various grades for diverse applications. As on 01/04/2011, CIL operated 467 mines in 21 major coalfields across eight states in India, including 164 open cast mines, 273 underground mines and 30 mixed mines (includes both open cast and underground mines). It also operated 17 coal beneficiation facilities with an aggregate designed feedstock capacity of 39.40 million tons per annum. It intends to develop an additional 20 coal beneficiation facilities with an aggregate additional proposed feedstock capacity of 111.10 million tons per annum. Besides this, it provided 85 hospitals and 424 dispensaries. Coal India’s major consumers are the power and steel sectors. Others include cement, fertilizer, brick kilns etc. 2.1 MISSION OF COAL INDIA LIMITED
The Mission of Coal India Limited is to produce the planned quantity of coal, efficiently and economically in an eco-friendly manner, with due regarding to safety, conservation and quality. 2.2 VISION OF COAL INDIA LIMITED
To emerge from the position of domestic leader to leading global player in the energy sector by adopting best practices from mine to market with due care to environmental and social sustenance.
2.3 Corporate structure of CIL
DIRECT SUBSIDIARIES: INDIAN
Bharat Coking Coal Limited;
Central Coalfields Limited;
Central Mine Planning and Design Institute Limited;
Eastern Coalfields Limited;
Mahanadi Coalfields Limited;
Northern Coalfields Limited;
South Eastern Coalfields Limited;
Western coalfields limited
DIRECT SUBSIDIARIES: INTERNATIONAL
Coal India Africana Limited.
INDIRECT SUBSIDIARIES:
1. MJSJ Coal Limited; and2. MNH Shakti Limited.
Figure 2.1 Corporate Structure of Coal India Limited
Coal India Limited was established in 1973 and is wholly owned by the Government of India. Coal production operations are primarily carried out through seven of the Company wholly-owned Subsidiaries in India. In addition, another wholly- owned Subsidiary, CMPDIL, carries out exploration activities for the Company’s Subsidiaries and provides technical and consultancy services for the Company’s operations as well as to third-party clients for coal exploration, mining, processing and related activities. Coal India Limited have also established a wholly-owned subsidiary in Mozambique, Coal India Africana Limited (“CIAL”), to pursue coal mining opportunities in Mozambique and have acquired prospecting licenses for two coal blocks in Mozambique. Coal India Limited have been conferred the Nav Ratna status by the GoI, which provides the Company certain operational and financial autonomy. Further it was bestowed by the Maha Ratna status on 11 April 2011. In addition, six of the Company wholly owned Subsidiaries, including CMPDIL, have also been accorded the Mini Ratna status by the GOI. Care for Safety & health:
Coal India Limited continues to focus on maintaining a safe work environment through the implementation of the safety policies and a structured multidisciplinary safety organization that oversees the Company’s operations. Coal India Limited have established and continues to focus on various environmental initiatives including land reclamation and restoration in open cast mines, water harvesting, afforestation and rehabilitation at the Company’s mines. Care for peoples:
Coal India Limited has also made significant investments in education, health and community development initiatives. It has well developed CSR policy for the employees and for local peoples. It provided 85 hospitals and 424 dispensaries. Care for Environment:
CIL constantly addresses the impact of mining activities across environmental and social issues. Eco-friendly mining systems have been put in place in all of its mining areas. To make environmental mitigation measures more transparent, CIL introduced state-of-the-art Satellite Surveillance to monitor land reclamation and restoration of all opencast project of CIL. Till date, CIL made afforestation over a land of around 32000 hectares while the total forest area degrades due to miming operation is 12800 hectares, which means for every hectare of forest land, CIL has made plantation in 2.5 hectares of land. Occupational Health and Safety:
Occupational Health & Safety (OHS) is a vital part of CIL’s Safety Management Systems. A continuous effort made to measure and improves it through Risk Assessment Technique to avoid accidents. We have an Apex OH & S Committee headed by the Managing Director. This committee oversees implementation of our OH & S policy. Each of our subsidiary companies, Area and mine units have Professional Doctors and medical facilities for continuous monitoring and observation of workplace hygiene and occupational health. Training and Development:
CIL’s new Performance Management System incorporates a process called Competency Assessment and Training and Developmental Needs wherein appraisers are specifically called upon to identify and assess training needs of employees at specific intervals that do not coincide with Performance Appraisals. This is so that training needs can be assessed objectively. Training is imparted to take care of an individual’s career development as well as functional and skill enhancement. Competency and Development training inputs include Skill and general performance enhancement, communication skills and Career development. Functional training needs are identified and conducted by functional departments while Corporate HR organizes competency and develop inputs. The Indian Institute of Coal Management (IICM) operates under CIL and imparts multi- disciplinary management development programs executives. .At company level Management Development Institute imparts training to executive and supervisors as per training need from time to time and at area level well established Group Vocational Training Centers imparting functional and skill up gradation
training. Competitive Strengths:
The largest coal producer and one of the largest reserve holder of coal in the world Well positioned to capitalize on the high demand for coal in India Track record of growth, cost efficient operations & financial performance Strong capabilities for exploration, mine planning, research and development Experienced senior management team and large pool of skilled employees Business Strategies Continue to increase production and capitalize on the significant demand-supply gap for coal in India Improve realizations through increased sales of beneficiated coal and higher quality coal, and the use of E-Auction pricing mechanisms Enhance the Company profitability and maintain the Company competitiveness by improving operating and cost efficiencies
2.4 About South Eastern Coal fields Limited
SECL is the largest coal producing company in the country. It is one of the eight subsidiaries of CIL (A Govt. undertaking under Ministry of Coal). SECL is Coal India’s premier coal company, operating its coal mines in the state of Madhya Pradesh and Chhattisgarh state which is also geographically located at the heart of the country. Chhattisgarh and Madhya Pradesh inhabited by simple minded and hardworking tribes with a rich cultural heritage. Chhattisgarh is not only the rice bowl in India but also rich in mineral resources with coal being the prime mineral resource that is being exploited commercially for about a century. Ever since its formation in 1986-87, SECL has always exceeded its physical and economic targets. In the year 1992-93 SECL has been bifurcated and three areas located in Orissa have been transferred to Mahanadi Coalfields Ltd. Even after bifurcation, SECL is marching ahead to exceed its physical and economic targets. After bifurcation the present SECL comprises 13 areas located in three districts of Madhya Pradesh named as follow: is also a part of SECL. Coal mining area of SECL as on 31st March 2012 are as below: – 1. Bhatgaon Area
2. Bishrampur Area
3. Baikunthpur Area
4. Chirimiri Area
5. Hasdeo area
6. Jamuna & Kotma Area
7. Sohagpur Area
8. Johila Area
9. Raigarh Area
10. Korba Area
11. gevra Area
12. Kusmunda Area
13. Dipka Area
14. Dankuni Coal Complex (West Bengal)
The SECL family consists of 75,835 employees as on 1st May 2012 who are predominantly locals. The success of the company is largely due to the discipline and hard work of these employees, excellent cooperation of trade unions, the State Govt. and the local people. SECL operates through 92 mines (1st April 2012) spread over eight districts (three of Madhya Pradesh and five of Chhattisgarh). The State wise, type wise composition of those 92 mines is given in Table below: EXHIBIT 2.1
Type of Mine
Chhattisgarh
Madhya Pradesh
Total
UG mines
41
29
70
OC Mines
13
08
21
Mixed Mines
01
–
01
Total
55
37
92
2.5 Organizational structure of SECL:
Figure 2.2 Organizational Structure of SECL
CMD
CHAPTER- 3
3. Review of Literature:
1. Is the balanced scorecard HR’s ticket to the board? Nelson, Paul. Personnel Today, 2002 most thoughts comprised of some combination of “BC is a wonderful tool to allow HR to show its value to a firm”, “BSCs will only work with senior management buy-in” and “BSCs alone will not bring a firm closer to its goal, contributing to the overall business will”.HR Performance Scoring Demonstrates Results. McKewen, Darren. 2004. Career Journal.com Accessed from website. The first part of this article gives
numbers on the popularity of BCs throughout industry. From the article: “According to a recent survey by the Balanced Scorecard Collaborative and the Society for Human Resource Management, about one-fourth of HR organizations have adopted the Balanced Scorecard approach. However, virtually all of the 1,300 respondents have explored the possibility.” The rest of the article has no relation to balanced scorecards. 2. The Balanced Scorecard: Creating a Strategy-Focused Workforce. Frangos, Cassandra. A synopsis of three scholars’ (Jac Fitz-enz, David Norton, and Helen Drinanwork) in the field of HR metrics and analysis, by way of selling the author’s upcoming Net Conference. 1. Fitz-enz evaluates a firm’s HR process by cost, duration, accomplishment, error rate, employee satisfaction, matricing these five over three distinct tasks: acquiring talent, developing talent, and retaining it.
2. Norton developed the “Human Capital Readiness Report,” which provides a snapshot of an organization’s human capital relative to its strategic requirements. It documents the strategic requirements, then shows, through its measures and programs, how human capital is being developed.
3. Drinan had been working on a profile of HR leaders “So what is the profile of outstanding HR leaders? Among other things, they derive their agendas from enterprise business objectives; they stay in touch with the workforce; think “customer focus,” not “customer service”; and concentrate on a few strategic priorities.” 3. Source: Kaplan and Norton 1992
In the literature review process, it seems unlikely that one particular definition is used in the different studies thereby making it difficult to settle on a standard definition for the BSC. Nevertheless, Malmi (2001) recommends that the success of BSC be judge based on the purpose for adoption because it is only by putting BSC into context that its role can be appreciated in an organization. He therefore point out that a better way is to look at the BSC based on purpose for adoption, its role in the organization and the desired benefits anticipated from using it. The figure below depicts the BSC framework
4. Other management scholars have attempted to define or to describe BSC, for example, Niven (2002) consider BSC to be a set of measures derived from an organizational strategy that helps management of the organization to communicate the outcomes and performance drivers by which the organization plans to achieve its mission and strategic objectives. The author goes on to explain that, the BSC comprise of three systems: a measurement system, a strategic management system and a communication system. Likewise, Olve (2003) considers balanced scorecard as a customized communication tool within a management control system applied at different levels of the organization and for different strategies. The author sees BSC as a communication tool and management control system that is used across the organization. 5. Sandelin (2008) explore how cultural, personal, action and results controls work together to achieve performance goals in a growth firm context. In the paper, the author argues that the type of controls to introduce in an organization depends on the functional demands of the managers pointing out that in most small firm‘s controls is largely informal and as the firm grows the need for formal controls become apparent. According to Sandelin(2008) the use of informal cultural, personal and action controls working in harmony can substitute for a more formal control system in an organization. The paper shed light on how the different types of control in an organization affects the performance of the organization by arguing that performance objectives can be achieve by various control system both formal controls and informal form of controls.
.
CHAPTER- 4
4. Research methodology:
4.1 Need for the study:
The Performance management system is helpful in increasing the efficiency of the employees and the organization, the concept of Balanced Scorecard is new to the organization and is in a process of system implementation, and hence, it was very necessary to make each and every executive aware about the new PMS. The report is based on the performance management system and the balanced scorecard that is been implementing in the company in the year
2013-14. This includes visits to different units of Hasdeo area to make sure that each and every executive of Hasdeo area understands the concept of balanced scorecard & employees are well aware about the goal setting stage of Performance management system. 4.2 Statement of the problem;
To study the process of implementation & application of Balance Scorecard as a performance measurement system and observe the stage of goal setting process of BSC in the organization. 4.3 Objective of the study:
1. To study the implementation of Balance Scorecard as a performance management system 2. To identify the difference between BSC as implemented by CIL with another companies implementing BSC 3. To study the Goal setting process for executives
4. To study the perception of employees on BSC/PRIDE FORM
4.4 Scope of the study:
Balance Scorecard is an extremely helpful and effective tool for performance measurement. Organizations, all over the world are adopting it and discovering its effectiveness. SECL is implementing Balanced scorecard in the organization for the first time so it is of extreme importance that the process of implementation should be correct and thoroughly planned and deeply monitored to get the desired results. It is also of extreme importance that the employees in the organization understand and accept this method so that it can eventually be enmeshed in the fiber of the organization and contribute to increased productivity and efficiency. A well planned implementation of the Balanced Scorecard in the organization will increase the efficiency of the employee, department, and organization as a whole. If the balanced scorecard is successfully integrated into day to day business life, it can be developed into a comprehensive and universal tool. It is a tool that provides all activities with a strategic framework and ensures more clarity and consistency for all parties involved to help them in formulating, communicating and implementing their strategy. It supports implementation, which makes it possible to understand strategic action in terms of it being a daily task and to realize it as such, as well as to link it with operational action. 4.5Limitations:
Employees may be reticent to give their opinions in an official capacity despite maintenance of anonymity Respondents are likely to respond in a manner similar to those as their colleagues due to peer influence Respondents tend to be disillusioned with continuous administration of surveys and are likely to finish early as a task without thinking it over 4.6 Research Design:
The aim of the project is to study implementation of BSC in SECL; hence the first item under study is how BSC was implemented in the organization that is done through: 1. Visit to various units of the organization
2. Distribution of manual forms and distribution of PRIDE forms to the executives 3. Campaigning and meeting with the executives to illustrate BSC and Goal setting process 4. Maintenance of details of executives, no. of Pride forms distributed, and corrections 5. A comparison of the implementation of BSC in SECL with that suggested by Kaplan & Norton and with that implemented by another company will also be done. 6. And last, but most importantly, the findings of a survey conducted on SECL employees with the purpose of gauging their opinion and perception about BSC & Goal setting process as implemented by the organization will be analyzed and interpreted through a feedback form.
Methodology:
Type of Survey: A Descriptive type of study is done to identify trends and patterns of behavior of employees on implementation of Balanced Scorecard and Goal setting process. Population size: A set of questionnaire was distributed among 110 employees of SECL of different units from different department. Sample Size: A sample size of 70 employee’s response was recorded to analyze the pattern of the behavior of employees against Balanced Scorecard implementation. Sampling method: Simple random sampling. It is the sample design in which selections are drawn from a population in such a way that gives every member and every combination of members an equal chance of being selected. Data sources:
Primary data:
– One to one interaction: A Personal Interaction with each and every employee was carried out and their response was observed on various aspects of BSC and Goal setting process. – Observation: It includes participation in various meetings and camps organized by the company for the executives as a demonstration of Balanced Scorecard implementation. Secondary data:
Company’s Manual
Company’s website
Company’s journal & magazines
Research instrument: A systematic set of questionnaire was prepared exclusively for the executives to measure their understanding of BSC and goal setting process. The set of questionnaire comprised of 15 different questions which is divided into three sections i.e. Understanding of Balanced Scorecard, Awareness about PRIDE form and understanding of Goal setting process. Tools of data analysis:
1. Simple Mean
2. Percentage Analysis
3. Anova
4.8 Chapterisation:
Chapter 01:
Introduction – The chapter gives a deep understanding about the basics of performance management system and Balanced Scorecard which includes its origin, theories related to Balanced Scorecard and historical views on BSC. A detailed theory is also given in the chapter about the process of implementation of Balanced Scorecard. Chapter 02:
Profile of the industry – The chapter contains the complete information about the organization which includes its history, production, locations and organizational structure of the organization. The chapter also includes a brief description about the subsidiary organization and its structure. Chapter 03:
Review of literature – The chapter consists of summary and brief review on various literatures of Balanced scorecard written by various authors and scholars. Chapter 04:
Research methodology- The chapter includes the process of survey taken from the employees on implementation of Balanced Scorecard in the organization that includes population, samples & tools for the analysis and methodology for analysis of behavior of employees towards the BSC and Goal setting process. Chapter 05:
Analysis and Interpretation- The chapter includes the analysis and interpretation of the data recorded in survey through percentage analysis tool and anova. Chapter 06:
Summery of findings, conclusions & Suggestion- The chapter includes the findings of the analysis, conclusion of the report, suggestion and recommendations for the company on the basis of report.
CHAPTER- 05
5. Analysis & Interpretation:
The data received was analyzed based on reception of positive responses towards questions. A Positive response stood for a positive perception towards BSC as a tool. The data is represented graphically for Executive responses, and that is the overall response of the Employees of the organization. Based on this evaluation we can reach conclusions on the perceptions of employees of the various aspects of Balanced Scorecard and their opinions on it.
Results/conclusion:
Awareness about BSC:
The figure shown below represents the employee’s awareness about the basic concept and benefits of performance management system that has been implementing in the Coal India limited/ South Eastern Coalfields Limited.
Figure 5.1
The above figure shows that out of seventy employees, 88.50 percent of the employees were strongly agree about the statement, 8.50 percent of the employees given their response in moderate and 03 percent of them were only agree about the statement. None of the employees were disagree about the statement. The figure shows that majority of the employees were aware about the concept and benefits of PMS.
The figure shown below represents the employees understanding of their Targets, KPI’s & KRA’s given to them for their respective department for a given time period e.g. Mining, Finance, Operation, Sales & Marketing etc.
Figure: 5.2
The figure gives a clear view that 92.80 percent respondent were strongly agree about the given statement, 2.80 percent employees were agree about the understanding of targets and number of moderate respondents were 4.40 percent. Again there was no response on strongly disagree and disagree option so we can conclude that almost everyone in the organization was aware about their targets given to them.
BSC is the tool that helps employees and organization to conclude strategy into action. The response for the motivation and direction through the Balanced Scorecard for improving efficiency in work was as follows.
Figure: 5.3
The above figure shows that out of 70 respondent, 57 percent of the respondent were strongly agree that BSC helps them in motivating and giving direction to achieve the targets, 30 percent were agree and 10 percent respondents given a moderate response. 03 percent of the respondents found disagree on the statement; this implies that most of the employees are satisfied with the balance scorecard and only a very less number of
employees didn’t find it useful.
This is the first time SECL introducing BSC in the organization so as per the introductory program & To understand the BSC, targets, KPI’s & KRA’s, better employees were asked by the superior authority to discuss it with subordinates of their respective department. The graph shown below represents the number of employees who discussed BSC with their subordinates.
Figure: 5.4
The graph shows that employees who discussed the concept of PMS, BSC, KPI’s and KRA’s with their subordinates were 95 percent employees while 05 percent of them didn’t discuss. This shows that the maximum number of employees discussed the concept thoroughly while a few of them didn’t discuss it with their subordinates.
Employees were asked the general attitude towards the BSC implementation in the organization have positive behavior of employees towards BSC.
Figure: 5.5
The diagram represents the positive attitude of the employees towards the BSC implementation, out of 70 respondents 72 percent of the employees strongly believe that people in the organization have a positive attitude towards the BSC, 14 percent of them only agree, 10 percent of them given a moderate response and the 5 percent of them disagree with the statement. This proves that maximum employees have positive attitude towards the BSC but at the same time few of the employees are not satisfied with the attitude of subordinates towards BSC.
Understanding of PRIDE FORM:
The BSC was given the name of PRIDE that stands for Performance report for individual development of executive. Employees were asked by the senior authorities to discuss the PRIDE form with the subordinates and have a deep
understanding of the criteria’s of the form.
Figure: 5.6
PRIDE FORM that is distributed among the employees. 82.50 percent of seventy employees studied that manual and form thoroughly 6 percent of them agree that they have studied it 1.50 percent response was moderate and 10 percent of them were disagree about the statement, that shows maximum of the employees paid a sincere attention towards the understanding of PRIDE FORM.
A response was recorded on understanding of different columns and rating scale of the PRIDE form from the employees. The response was as follows;
Figure: 5.7
The graph shown here represents the understanding of PRIDE FORM distributed to the employees, 59 percent of 70 employees strongly agree that they had complete understanding of the PRIDE FORM, 25 percent of them were agree but they had little doubt on some concepts, 05 percent of them responded that the form was not easily understandable to them and 11 percent of them given their response in disagree.
A response was recorded on future scenario of the BSC that whether PRIDE FORM will help in improving the performance management system of SECL in near future. The response of the employees was as follows.
Figure 5.8
The response to this statement was 35 percent out of 70 employees who given their response in strongly agree, 50 percent of them were merely agreed, 15 percent of them given a moderate response on the statement while none of them were disagree. From the above chart it can be said that PRIDE form will help in improving PMS.
A satisfaction feedback was taken from the employees about the PRIDE Form
which suggested their view on increasing the efficiency through the BSC, that is whether the PRIDE Form is sufficient in itself to increase the efficiency of the organization. Figure 5.8
The response for the statement was taken in yes/no and 95 percent given their response in positive while 05 percent of the 70 samples given their response in no. the chart shows that maximum employees are agree that PRIDE form is sufficient in itself for performance management system.
Feedback on Goal Setting Process:
Each employee has given targets with respect to their departments by their reporting authority so a response was recorded on understanding of the targets for each employee. The response to the statement was as follows Figure 5.9
The response of the above statement found that 96 percent of 70 employees said that they understood the goal setting process Balanced Scorecard while 04 percent of the 70 respondents didn’t understand it properly they needed some more discussion and doubt clearing sessions. This implies that maximum number of employees had sound understanding of their Targets. KPI’s are the key performance indicators which represent the areas that help employees to enhance their performance. The graph below represents the understanding of KPI’s among employees.
Figure: 6.0
The response to this question was as follows. 96 percent out of 70 employees told yes while 04 percent of 70 samples had doubt on KPI’s (Key Performance Indicator). The graph above indicates that maximum number of employees understood and recognizes their key performance indicators.
The graph shown below shows that targets given to the employees for their respective department were achievable to them or not. The response is as follows
Figure: 6.1
The response to this question was, 89 percent out of 70 employees were said that the targets given to them were achievable while 11 percent out of 70 told that the targets were not achievable due to low production in the unit.
The diagram shown below shows the feedback of employees regarding Goal sheet and its shortcomings, whether the Goal sheet / scorecard suffered in terms of relevant KPI’s of the employees. The response to this statement was as follows.
Figure: 6.2
The graph above shows response to this statement was 93 percent out of 70 employees who believe that scorecard was sufficient and a better method for improving performance of the employees as their relevant KPI’s are purely definable and while 07 percent out of seventy employees believe that their KPI’s were not clear so it suffered in terms of KPI.
The whole data shown above are converted into three common pie charts with three different sections of complete understanding, moderate understanding and zero understanding to show the overall response of the employees regarding the asked question. The mean was calculated for all the responses and with the help of percentage analysis a final conclusion is drawn which is shown below in the form of pie charts.
Awareness about Balanced Scorecard: The chart shown below gives the overall response of the employees towards the awareness about Balanced Scorecard.
Figure: 6.3
The above charts represents that the 81 percent of the employees are completely agree about the awareness of Balance Scorecard which represents a higher number of understanding of BSC while 31 percent recorded a moderate
response and only a 6 percent of employees were recorded with a disagree response. Overall it can be said that maximum employees has complete awareness of Balanced Scorecard.
Understanding of PRIDE FORM: The chart below represents the overall understanding of PRIDE form among employees.
Figure: 6.4
The represented pie chart shows the overall response towards understanding of PRIDE FORM which shows a high number of employees are understood the basics of PRIDE form like understanding of KPI’s, KRA’s and targets and circulation and implementation of Pride form.
Feedback on Goal Setting Process: the following chart shows overall response of the employee towards understanding of Goal setting process.
Figure: 6.5
From the above pie chart it is concluded that a high number of employees understand the Goal setting process of PMS and merely a 5 percent & 2 percent given their response in moderate and disagree. The chart suggests a successful implementation of BSC and goal setting process in the organization.
Analysis of variance
01. Awareness of balanced score card against age group.
Null hypothesis (Ho) – There is no significance variance between the Balanced Scorecard and Age group of the employees.
EXHIBIT 5.1
Age
20-25 yrs
25-30 yrs
30-35 yrs
35-40 yrs
Agree
24
13
12
7
Moderate
4
2
2
1
Disagree
2
0
1
2
Total
30
15
15
10
Analysis:
Anova: Single Factor
SUMMARY
Groups
Count
Sum
Average
Variance
Column 1
4
60
15
198.6667
Column 2
4
30
7.5
57.66667
Column 3
4
30
7.5
49.66667
Column 4
4
20
5
18
ANOVA
Source of Variation
SS
df
MS
F
P-value
F crit
Between Groups
225
3
75
0.925926
0.457936
3.490295
Within Groups
972
12
81
Total
1197
15
Here calculated value is less than critical value, hence null hypothesis is accepted. Inference – There is no significance varience between age group, about the awareness of balance scorecard.
02. Awareness of BSC against experience:
Null hypothesis (Ho) – There is no significance variance between awareness of employees against Balanced Scorecard and experience.
EXHIBIT 5.2
Experience
0-3 yrs
3-5 yrs
5-10 yrs
10 or above
Agree
15
12
7
14
Moderate
7
6
3
1
Disagree
3
2
0
0
total
25
20
10
15
Analysis:
Anova: Single Factor
SUMMARY
Groups
Count
Sum
Average
Variance
Column 1
4
50
12.5
94.33333
Column 2
4
40
10
61.33333
Column 3
4
20
5
19.33333
Column 4
4
30
7.5
65.66667
ANOVA
Source of Variation
SS
df
MS
F
P-value
F crit
Between Groups
125
3
41.66667
0.692521
0.574022
3.490295
Within Groups
722
12
60.16667
Total
847
15
Here calculated value is less than critical value, Hence null hypothesis is accepted.
Inference – There is no significance difference between experiences, about the awareness of balance scorecard. 03. Awareness of PRIDE Form against age group:
Null hypothesis (Ho) – There is no significance variance between awareness of PRIDE form and Age group.
EXHIBIT 5.3
Age
20-25yr
25-30yr
30-35yr
35-40yr
Agree
26
12
13
8
Moderate
2
1
1
1
Disagree
2
2
1
1
Total
30
15
15
10
Analysis:
Anova: Single Factor
SUMMARY
Groups
Count
Sum
Average
Variance
Column 1
4
60
15
228
Column 2
4
30
7.5
49.66667
Column 3
4
30
7.5
57
Column 4
4
20
5
22
ANOVA
Source of Variation
SS
df
MS
F
P-value
F crit
Between Groups
225
3
75
0.841121
0.497189
3.490295
Within Groups
1070
12
89.16667
Total
1295
15
Here calculated value is less than critical value, Hence null hypothesis is accepted.
Inference – There is no significance difference between Age group, about the awareness of PRIDE FORM.
04. Awareness of PRIDE form against Experience:
Null hypothesis (Ho) – There is no significance variance between Awareness of PRIDE from against Experience.
EXHIBIT 5.4
Age
0-3yr
3-5yr
5-10yr
10 or above
Agree
19
16
8
12
Moderate
5
1
1
1
Disagree
1
3
1
2
Total
25
20
10
15
Analysis:
Anova: Single Factor
SUMMARY
Groups
Count
Sum
Average
Variance
Column 1
4
50
12.5
129
Column 2
4
40
10
88.66667
Column 3
4
20
5
22
Column 4
4
30
7.5
49.66667
ANOVA
Source of Variation
SS
df
MS
F
P-value
F crit
Between Groups
125
3
41.66667
0.576037
0.64167
3.490295
Within Groups
868
12
72.33333
Total
993
15
Here calculated value is less than critical value, hence null hypothesis is accepted.
Inference – There is no significance variance between Experiences, about the awareness of PRIDE FORM.
CHAPTER- 06
6. Summary of conclusion, findings & Suggestion:
6.1 CONCLUSION:
From the above charts the following conclusion can be drawn on the implementation of Balanced Scorecard and Goal setting stage of PMS.
Awareness about BSC:
The employees of the executive level were quite well aware about the Balance Scorecard. Most of the employees found that PMS is the better way to improve the performance of the employees. The employees have a positive attitude towards the implementation of BSC in the organization. The BSC can help to
boost up their performance in the organization at departmental and unit level.
Understanding of PRIDE FORM:
The data represented in the charts shows that the PRIDE Form distributed in the organization to boost the performance of executives was mostly understandable to the employees. Maximum number of employees given a positive response toward PRIDE FORM as they discussed it with their subordinates and attended the camps and meetings held for PMS. A less number of people given a negative response because they were absent in some of the meetings and camps organized for them. Implementation of BSC in the organization is a positive step towards improving the performance of employees and organization as well.
Feedback on Goal Setting Process:
The Goal setting process is the first stage of Performance management system and from the given charts it is concluded that maximum number of employees is well informed of the process, they grasped the process easily, they found their KPI’s and targets relevant and achievable to them.
Overall:
The data overall represent that BSC is an effective tool for motivating employees and improve their performance in the organization, but as it is first time introduced in the organization so it could be fail to some extent due to lack of awareness among some of the employees but as the number of positive responses are much greater than negative response so it could be a big success for the organization. The data represented draws a positive result on Goal setting process. The Goal Setting process was done very carefully and completed successfully in the organization. 6.2 Suggestion/recommendation:
This is the first time introduction of Balanced Scorecard in the organization so this is my recommendation to the company that it needs some more
attention, care and precaution. Implementation of BSC for performance management system is a big task to deal with to enhance the performance of the employees so it is important that each and every executive has a thorough understanding of the idea and concept of Balanced Scorecard. He should have a proper and deep understanding of “KPI”, “KRA” and their respective targets. The targets assigned to the employees should be kept quite flexible so that they can achieve it by putting normal efforts. This will increase a kind of willpower and confidence in them that will help to make a good figure and strategy for the next session of Balanced Scorecard. All employees should be kept in constant touch with the targets by HOD’s. They should be made to feel responsible towards achievement of results and also as an important part for the same. The employees should be updates about progress BSC targets and credit should be distributed in the team. That was all employees will be more dedicated towards the goals and BSC can be integrated in the structure of the organization. There should also be mandatory meetings of entire department, at all levels for BSC. Making their entire department aware of their targets and updating them regularly can also be incorporated as a BSC target since the employees are eager to be updated but it may not be happening in every case.
Bibliography
COMPANY’S MANUALS
http://hr.rpi.edu/update.com
www.coalindia.in
www.secl.gov.in
Wikipedia
www.performance-appraisal.com
Management of Human Resources, Gary Dessler
Kaplan R.S. and Norton D.P. (1992). “The Balanced Scorecard – Measures That Drive Performance”, Harvard Business Review, Vol.70, Jan-Feb.
Kaplan R.S. and Norton D.P. (1993). “Putting the Balanced Scorecard to Work”, Harvard Business Review, Sept-Oct.
Kaplan, Robert S. & Norton, David P. (January-February 1996). Using the Balanced Scorecard as a Strategic Management System.
Kaplan, Robert S. & Norton, David P. (1996). The Balanced Scorecard: Translating strategy
Drucker, P. (1954) the Practice of Management, New York: HarperCollins.
Annexure
Questionnaire:
The following are the feedback survey questions on BSC/PRIDE Form, kindly go through them please put a tick in the box which seems most appropriate, like this: ☑ Designation: ________________________
Department: ________________________
Gender : ð Male ð Female
Age: ð below 25 yrs. ð 25-30 yrs. ð 30-35 yrs. ð Above 35 yrs. Educational Qualification : ð SSLC ð HSC ð UG ð PG Experience: ð Less than 3 yrs. ð 3-5yrs ð 5-10 yrs. ð Above 10 yrs.
Balance scorecard understanding:
Awareness about BSC:
01. I am aware of the BSC targets of my department
ð Strongly Disagree ð Disagree ð Moderate ð Agree ð Strongly Agree 02. BSC motivates and gives me direction in my work
ð Strongly Disagree ð Disagree ð Moderate ð Agree ð Strongly Agree 03. I have discussed BSC with my superiors and juniors.
ð Yes ð No
04. People in the organization have positive attitude towards BSC ð Strongly Disagree ð Disagree ð Moderate ð Agree ð Strongly Agree 05. I am completely aware about the concept and benefits of PMS that is been implemented in CIL/SECL ð Strongly Disagree ð Disagree ð Moderate ð Agree ð Strongly Agree
Understanding of PRIDE FORM
01. I thoroughly studied the PRIDE Form and discussed it with my sub-ordinates. ð Strongly Disagree ð Disagree ð Moderate ð Agree ð Strongly Agree 02. PRIDE Form was easily understandable to me
ð Strongly Disagree ð Disagree ð Moderate ð Agree ð Strongly Agree 03. PRIDE FORM will help in improving the performance management system of secl in near future. ð Strongly Disagree ð Disagree ð Moderate ð Agree ð Strongly Agree 04. Was the PRIDE form sufficient in itself for Performance management system? ð Yes ð No
If “NO” then what are the short comings?
Feedback on Goal setting Process:
01. I understood the Goal setting process
ð Yes ð No
02. Were the KPI’s understandable
ð Yes ð No
03. Were the targets realistic / achievable?
ð Yes ð No
04. Was the goal sheet/scorecard suffered in terms of relevant KPI? ð Yes ð No
05. Please provide some necessary information regarding Pride form for further improvement, if any?
