Accelerating Performance through Capability Building and Organisational Restructuring

13/06/2003 Indian Oil People...Towards Excellence

Accelerating Performance through Capability Building

and Organisational RestructuringBy

Team HR, Indian Oil Corporation Ltd

13th Jun 2k3,

Indian Oil

Presented at HR Round Table organized by ISPe & UPES, Dehradun


A Time to Reflect..…..Then….

• Hydrocarbon sector not open to private investment

• APM: Direct Government control over prices and assured returns on capital employed

• Sales Plan entitlement: Market share handed on a platter to all players

• Demand more than supply: Seller’s Market

• Competition at back burner!!

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…And Now….

• De-regulation of Indian Economy (1991 onwards….)

• Phased dis-mantling of Administered Price Mechanism…1.4.98 to 31.3.2002

• Full De-regulation of Hydrocarbon sector• Market Driven Price mechanism / Tariff

adjusted import parity pricing• Growing global concern regarding

vehicular emissions and need to produce cleaner fuels

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…And Now….

• Supply exceeds demand for the first time • ………and Natural gas makes a grand entry

changing the energy scene in India• Consumer driven preferences….higher octane

fuels….& the pleasures of shopping!!• Value addition to the customer without

sacrificing the bottom line• Knowledge / Innovative Marketing Strategies to

be the Key driver of competitive advantage in the Hydrocarbon sector

• Bulk consumers have a choice and are exercising it!

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Implications of Changed Paradigm

• Margins under pressure• Need for huge capital investment for producing

cleaner fuels (eg. ultra-low sulfur diesel) • Market Share – the battle ground• New and diverse products & service package• Cut-throat competition in Retail Marketing• Emerging ‘Gas’ scenario & its impact on liquid

hydrocarbon business• Need for increased performance at individual,

team & organizational levels

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Organizational Response

• As a result managerial priority to focus on organisational performance for customer satisfaction

• Need for ‘Fasterr-than-competitor’ response• From Product & market competition to

process competitiveness to get competitive advantage

• Need for an Effective Performance & Talent Management System

• Need for extensive internal communication to achieve organizational transformation

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Performance Management in Indian Oil

• MOU Targets with the Government;• Internal growth targets & business plans• Target setting for Divisional Directors

cascading Top-down• MOU Parameters on Performance

Commitment unit wise/ state-wise• Goal based appraisal system for all key

managerial roles already in position• Goal setting process participative• Performance Oriented KRAs/KPIs

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Performance Management in Indian Oil

Developmental

Initiatives

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•Potential Assessment•Training & Development•Employee Education•Goal Setting•Performance Appraisal•Counseling•Career Planning •Job Rotation•Job Enrichment


Performance Management thru capability building in Indian Oil

• Identification of Pivotal Organizational Roles

• Identification of KPI for pivotal roles• Competency mapping for pivotal

roles• Competency mapping exercise –

Further extension to other roles• Tracking high performers • Design & implement people oriented

HR policies

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Building CapabilityLearning Infrastructure

• Indian Oil Institute of Petroleum Management, Gurgaon (Management Education, Management Development & Competency Building)

• Indian Oil Management Centre for Learning, Mumbai (Management Development & Competency Building)

• Indian Oil Management Academy, Haldia (Management Development, Supervisory Development & Competency Building)

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Building Capability

• Learning Infrastructure– 17 well equipped Training Centres:– One each at 7 refineries; – 3 in all at Pipelines Hqrs & 2 regions; – 4 at Regional Offices of Mktg Divn;

and– One at R&D Centre

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Building Capability

Learning Interventions• Staple Programs – “MUST FOR ALL”• Functional Programs• Developmental Programs• Accelerated Executive Learning• Management Education• e-Learning• Staple Programs – “MUST FOR ALL”• Functional Programs• Developmental Programs• Accelerated Executive Learning• Management Education• e-Learning

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Building Capability

• Skill Inventory• Skill Gap Analysis • Accelerate the learning process

– Threshold– Cutting Edge– SMP/ AMP for senior levels

• Updating existing skills (Selling Marketing; Refinery Technology )

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Building CapabilityIndian Oil

•Building New Skills:–Brand building skills

–Negotiating skills

–Skills of Mathematical modeling

–Building franchisee network/ Management skills etc

•Creation of focus work groups/ Capability Building Teams

-Retail

-Consumer

-Lubes etc.


Managing Performance thru Organisational Restructuring

• Optimization of manpower/ de-layering in reporting relationships / decision-making structure

• Setting up of Optimization group for optimization of the entire supply chain

• Creation of State office(s) to get closer to the customer

• Reorganizing sales group into Retail & consumer segments upto field level

• Creation of Regional Shared Service group• Key Accounts Manager for large volume customers

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Managing Performance thru Organisational Restructuring

• Creating additional infrastructure: First mover advantage & creation of entry barrier

• Creation of Lubes Group & Key Accounts Managers

• Integration of efforts with : IBP / CPCL / BRPL• Overseas Offices (Malaysia/ Lanka /

Mauritius / Dubai)• International Business Exposure• Setting up of a technology marketing

company to market select technologies developed by our in-house R&D – From ‘Knowledge’ to ‘Revenues

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Other Interventions

• Knowledge Management pilot project under implementation at a select location; to be replicated on a company wide basis

• Organizational Transformation on Top Priority• Internal Communication is the catalyst for

transformation• Communication Structure starting from

Chairman downwards already put in position• Inter-active e-mag ‘indianoil express’ as a

forum for generating ideas & on-line brainstorming

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Awards Management• Work is its own reward!!

– Key assignments for TOP performers– Advanced learning opportunities– Career growth opportunities

• Unit rewards for meeting / exceeding unit level targets: System in place & already under implementation

• Individual/ team reward scheme being designed

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Major Initiatives so far….•KPI / KRA based Performance evaluation system•Individual and group rewards for recognition•Accelerated promotion to qualified employees•State of the art Trg Institutes : IIPM – IMA – IMC•Cutting Edge / Threshold / i-MBA programmes•Structured Communication Meets across the organisation•International Business Exposure

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Framework of Organizational Transformation

•Awareness

•Alertness

•Action

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7S Organizational Excellence Framework

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SharedVision

Staff

Style

Systems

Structure

Strategy

Skills


The woods are lovely dark & deepBut I have promises to keep

And miles to go before I sleep And miles to go before I sleep

Robert Frost

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Gone are the days, whenBigger companies used to swallowThe smaller onesThe order of the day is the faster onesWill swallow the slower ones –And the size is immaterial

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Thank you

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