December 09

10th issue!
November-09
 “ One and one are sometimes Eleven...”
The number eleven like all other numbers has a story to it : The eleven pointed Maple
leaf on the Canadian National flag, a Cricket & Football team comprising of 11 playing
members each, the atomic number of Sodium, the prefix to the name "Apollo" which
took man to the Moon, Formula 1 champion Ayrton Senna's Car number... Just to
name a few amongst countless others, and now our initiative, E-mag!ne, is the newest
entrant to this elite club! Yes Friends, with this issue of E-mag!ne, it turns 11 months
old, just one issue short of its anniversary, which also promises to be a spectacular one!

This month’s issue brings to you another slew of articles from the enchanting world of
management, which seems to envelope us further & further with the passage of time.
We have our friend from IIM, Shillong writing in for us in this months’ Friends from
yonder section, and also featuring this month is the penultimate installment of the
paper “From social capital to social profits : discourses on corporate ethics, governance,
choices & values”, written by our faculty member, Dr. Prasenjit Maity.

This month Team E-mag!ne would like to welcome aboard its new member Ms. Pritha
Basu, who has penned the Q-quotient section for us.

On a concluding note on the last issue of this year & decade, we wish you a happy and
prosperous New year 2010 ! Keep reading and keep E-mag!n!ng :-D

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From the faculty desk..................................................4

Friends from yonder.....................................................7

Managing Recession- A challenge for HR...............10

Q-Quotient..................................................................13

Ace the Case...............................................................14

Campus Bytes.............................................................19

Voice Box....................................................................20

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-
 F RO M S O C I A L C A P I TA L TO S O C I A L P RO F I TS :
D I S CO U R S E S O N CO R P O R AT E E T H I C S , G OV E R N A N C E ,
C H O I C E A N D VA L U E S

(continued from last month’s issue...)

NEGOTIATING TRUST
From the management of human values to the management of corporate trust is a long, arduous and unenviable journey that
requires out of the box thinking matched with the capacity to relate to the empathy of individuals. So rapport-building would
appear to be a crucial requirement in this context of trust management when business leaders should be able to overcome the
tedium of Human Resource Development overkill in order to efficaciously enter into revolutionary dialogues with both blue
as well as white collar workers to make them chant the mantra of their respective organizations underpinned by their rational
choices (Chloupkova et al 2003)

IDEAS / IMAGES
It may appear to be rather far-fetched to deploy a highly specialized social scientific theoretical category like Social Capital in
the area of Business Management and Industrial Relations. The latter is a network of relationships that enter into professional
dynamics with one another in the highly charged world of business informed by factors such as the profit motive, ethical
applications, Corporate Social Responsibility, conflict resolution and a sense of accountability vis-à-vis the environment,
sustainable development and inclusive growth.

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So innovative ideas supported by creative images are required to streamline Industrial Relations in the post-globalized scenario
that predicates upon both a breakdown of barriers as well as establishment of new and difficult barriers in the cyber world of
netizens, their perceived expectations and their ever-increasing sense of achievements and complex role performances
(Coleman 1984).

So we have to understand the problematique of the increasing hiatus between business managers and their employees in the
context of relative deprivation that may be either incremental or else decremental in nature. The critical ploy that has to be
strategized in this connection is the network of inter-dependence that depends upon the fluctuating degrees of trust and
cooperation and overall organizational health of any given industry.

RATIONALITY OF CHOICE
It is somewhat difficult to estimate the rationality of a choice until the outcome of that choice is perceived either in material or
else in psychological terms. Exactly how rational a choice is would have to be decided subsequently when the question how
utilitarian that choice was would emerge in the future. The issue of Industrial Relations is all about the management of choices
in the workplace. Why should workers obey the management? What are the concerns of the management that are reflected in
its style of leadership? Is loyalty related to motivation? Or is loyalty a function of the chain of command? What are the effective
outputs of hierarchy?

The entire discourse on Discipline and Punish is predicated upon the assumption that the State (in this case the Management) is
always monitoring and evaluating the actions (and the consequences of such actions) of its Citizens (in this case the
Workforce). This social scientific approach to conformity rests on the hypothesis that individuals as rational actors would
intelligently choose between the options of conformity and non-conformity. While the former leads to the area of Reward
Management the latter leads to theories of penology i.e. how to mete out punishment that would rectify and improve upon i.e.
re-condition errant behavior.

So the question of effective communications arises at this juncture. How effectively can managers communicate with their
workers is a serious issue. Here emerge the concerns of dialogue versus pedagogue. What are the qualities of dialogue that
distinguish the channels of communications from the aspects of the power-authority discourse?

CHOICE AS A PARADIGM
The model of multiple preferences is rather complicated, as it entails different types of choices in different space, time, culture,
knowledge and power discourses. The choices before a Trade Union may not always be uniform, and may be influenced by
considerations like a global economic meltdown, local political tension, national emergency, social problems, regional
discrepancies in development, bad economy of scale, retrenchment, cost-cutting etc.

But the critical central issue still remains the anatomy of choice: why do men and women ordinarily behave in one manner and
why do they tend to behave otherwise under duress? This in itself constitutes an interesting universe of research where various
factors such as values, beliefs, attitudes, inclinations, orientations, opinions etc come into play in the wider area of choice
influenced by an inchoate regime of deterministic / indeterministic chaos (Coleman 1988a).

OWNERSHIP / TRUSTEESHIP
The management and the workers have to mutually entrench an ethos of cooperation that would both create and sustain the
values of Ownership / Trusteeship in their given organizations. One has to belong to and long for one's organization simply
because organizations are the institutions of collective behavior where people associate and interact to pursue certain set goals.

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The very fact that these targets have to be achieved and new targets innovated point to the fact that the organizational health of
any given industry is sound. The point of saturation has to be ably and creatively transformed into an arena of new possibilities
that lead to new challenges and innovative gestures..But achievement of targets is critically dependent on team performance,
and so the team players have to share different degrees of responsibilities and have to be burdened with different measures of
failures and successes. The most important consideration at this point is to determine who can shoulder what amount of burden.
So the question of authoritative allocation of values has also to be pondered upon actively by the management concerned.

The issue of Ownership / Trusteeship is also almost organically related to the issue of institutions. Each business organization, in
sociological terms, is an institution replete with a history of evolution, work culture, Trade Union ethics and typical management
practices. So the study of business organizations as dynamic institutions of power, authority, repression, obedience, reward and
punishment may lead to an ulterior understanding of Industrial Relations.

Actors and their interventions become criticalities that have to be objectively factored into the discourse of polemics that center
on issues / concerns of Industrial Relations. The credo of loyalty is also another ponderable that may be studied or else addressed
in order to appreciate the different dynamics of Social Capital, Rational Choice and Value Management.

VALUE MANAGEMENT
The question of moral values and business values may occasionally come across as a dichotomy, especially when the role of social
values such as commitment, traditions and loyalty is concerned. The recent economic recession worldwide has prompted Big
Business in India to retrench, cut costs, economize on operations, production, marketing and other strategic areas of their daily
activities. But there have been instances where probationers given the pink slip were again brought back home, so to say.

This is perhaps a truly Indian phenomenon that has been also somewhat motivated by external political pressures. But this event
is not to be identified with the somewhat out-of-vogue concept of Asian Values. The issue of Industrial Relations as sustained
(hypothetically) by the arrangement of trust and cooperation in business is also perhaps a function of traditional Indian family
values that happen to rely much more on loyalty and feudal ascriptions rather than the rational-legal structure of legitimacy and
authority (Coleman 1988b).

(To be continued...)

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 “The Carbon Standoff”
The Copenhagen Discord
The climate change meeting ended in Copenhagen with a non-legally binding political agreement at the last moment
between the United States and the big developing countries – China, India, Brazil and South Africa that forms the BASIC
group. The general response of various states to the climate change debate is based on their developmental objectives and
security interests. The meeting also talked about financial commitments and technology transfers. However, there have
been no commitments in this regard. India has rightfully sought to stand its ground in not accepting - A legally binding
emission cuts, peaking year and international verification of domestic mitigation measures. India has defended its
developmental goals and protected its right to faster economic growth. India, however, has taken a stand on moral
grounds that its per capita emissions will never cross the levels of the developed world.

India’s Concern for Environment

India's per capita output is one of the lowest globally as much of the country is without power, but it is still in volume
terms among the top five carbon emitters in the world. With the threat of climate change, India is called upon to change its
energy strategy based on coal, its most abundant resource, and to use other energy sources (e.g. oil, gas, renewable and
nuclear energy) instead, which may turn out to be expensive. Thus, an immediate issue is to come up with a better
negotiation strategy such that we have more freedom to decide which type of energy we use, how we generate power, how
to reduce methane emissions by agricultural practices or forestry and so on. Prior to Copenhagen, India pledged to reduce
the "carbon intensity" – the amount of carbon dioxide (CO2) emitted per unit of economic output – by between 20 and
25% by 2020, from 2005 levels on a voluntary and non-binding basis. We also heard this news a few days back that the
government is planning to replace polluting ‘chullahs’ in rural households with green stoves (stoves fuelled by biomass).
This would cover around 140 million households. This is a great initiative and would go a long way in not just saving the

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precious forests of India but would also seize many disorders which originate from the poisonous smoke of chullahs.
Government has put in great efforts to convert polluting vehicles on the streets of Delhi to CNG. The average car on the
Indian streets today conforms to Euro-3 or Euro-4 norms and the awareness with respect to the environmental damage
that is caused by plastics (polyethylene) has been on a constant rise. All these are excellent initiatives which would
definitely help India and its commitment towards the environment.

Developed v/s Developing Countries

China has also demonstrated leadership by making self-commitments in terms of cutting down the greenhouse
emissions by 2020. Even though the per capita emission and energy consumption in India and China are far less than
what they are in the developed nations (Although India globally might stand fifth in terms of greenhouse emissions, with
respect to per-capita emissions it is a tenth of the US), the fact remains that with increase in prosperity in both these
nations, more and more people will consume an increasing amount of energy. And if two billion plus people start
consuming as much energy as a few hundred million people in the West consume, then the world is surely doomed. So
while this is true that people in China and India have all the right to have a far better style of living – which would
invariably increase the level of emissions – there is also this blatant fact that the West and especially the US have been
extremely disinclined to cut down on emissions. Had they been doing the same, then today’s Copenhagen and
yesterday’s Kyoto would not have been needed in the first place. US has always put its national interest ahead of global
needs.
While west might create stringent conditions of environmental factors on imports from underdeveloped countries and
thus limit the competitive edge of developing and underdeveloped countries in terms of cost factors (as investments in
less polluting production systems would surely increase cost), the developed countries would continue to waste energy.
The Environmental Protection Agency has this shocking revelation that US is forced to spend a whopping $1 billion
every year only on disposing the food leftovers of Americans. Likewise, the value of wasted food in countries like UK is
around £10 billion annually.
Thus, when China, which emits almost 21% of global greenhouse gases, takes a voluntary commitment of cutting down
its emission by 40-45% by 2020 based on 2005 emission levels, and India, which emits just 4% of global greenhouse gases,
follows suit by committing to cut its emission by 20-25% by 2020 based on 2005 emission levels, it puts tremendous
pressure on the developed nations to make meaningful commitments. Developed nations have been consistently trying
to undo the kyoto protocol primarily the US, Russia, Japan and others have sought to undermine the kyoto protocol,
which is unacceptable. down by the impending pressures from China and India, the US has offered to cut down its
emissions by 17% by 2020 based on 2005 emission levels. Clearly, the commitment is far too low with respect to what the
nation is emitting as a whole.
Developed and developing countries have always had contrasting priorities about climate change and development.
Equity is the key to reach a common action agenda on climate change. Climate change negotiations have lacked
transparency, trust building and strong leadership. We must understand first that emissions do not respect national
boundaries. Therefore, if China, India, Brazil or any other industrializing country pump out tonnes of carbon using
older, non-environmentally friendly technology, it hurts the rest of the world. But carbon-intensive production methods
are still the cheapest. Clearly, if we are to save the atmosphere, developed nations need to support developing countries in
adopting environmentally friendly methods. It’s a moral case that large emitters, who are historic and currently
increasing emissions have contributed most to the problem of climate change, have some ethical obligation to help those
developing nations who have contributed the least yet will suffer the most.
The Road Ahead: Opportunities Galore
India agreed to the Copenhagen agreement that allows international on measures regulate emissions. However, tmost
important outcome of Copenhagen summit is the emergence of BASIC countries as a strong negotiator in future talks. It
could be seen as an opportunity for developing countries like India and China to set their own standards and work

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towards the creation of a better world. Large economic opportunities exist in emerging economies if markets for green
technology investment can be developed. Reductions in carbon emissions by the poor should not be expected at the
expense of development. Yet, other emission reduction by developing countries can be increased by technology transfer,
investment in better infrastructure, and efforts for modernization, all of which require financial support. Encouragement
to conservation and good practices would result in lower emissions.
India can take gradual mitigation actions that help in the development process. Reducing energy intensity of urban areas
can be an important step. Available energy is more evenly distributed to needy sectors of Indian society. Mitigation
actions will also help in reducing the adaptive costs of climate change in the future. There are many ways to leapfrog past
the dirty, polluting industries, and still give people a chance at a better life. Developmental process need not follow the
same learning curve. It’s time to shift to a more sustainable pattern of energy consumption and supply. We Indians
should be concerned about climate change since this phenomenon might have substantial adverse impacts on us. Not all
possible consequences of climate change are yet fully understood, but the three ‘categories’ of impacts are those on
agriculture, sea level rise leading to submergence of coastal areas, as well as increased frequency of extreme events. Each
of these pose serious threats to India. Negotiations at international level have caused the nation to think at its feet to adapt
and mitigate the climate change issues and it has also brought tremendous opportunity for development of green sources
of energy.
Public-private partnership in low carbon energy sources, reforestation efforts, rainforest protection, land use reform and
adaptation programs must be encouraged and incentives could be given. For example, if the cap-and-trade systems which
are emerging throughout the industrialized world as the favored domestic approach to reducing CO2 and other
greenhouse gas emissions are linked together through the existing common emission-reduction-credit system, namely
the Clean Development Mechanism (CDM), then powerful incentives can be created for carbon-friendly private
investment in the developing world. Even a carbon tax can exist with cap-and-trade program and complement one
another. It would use the power of the market to achieve cost-effective emissions reductions, and both would generate
revenues that could be used for the public benefit.

References
http://www.climate-leaders.org/climate-change-resources/india-and-climate-change/indias-nationalaction-plan-on-
climate-change
http://www.climate-leaders.org/climate-change-resources/india-at-cop-15/india-at-copenhagen
http://www.climatechallengeindia.org/
http://www.businessweek.com/globalbiz/content/dec2009/gb20091216_417541.htm

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It indeed is a quirky time for people to be in the HR business. Previously, or to be more precise, just a few years ago, HR meant
a bunch of individuals frantically trying to recruit the best talent in their respective industries/organizations. Talent that was
being searched for was not only rare but was also pricey, as the number of people doing the “lookout” for talent was significant
in comparison with the pool of people who comprised the “talent”.

Then suddenly the wave of recession hit the business world with a loud “thud”, waking everyone from their slumber and
prompting them to take stock of what is happening around them and realize how quickly they can adapt to the situation. How
exactly recession plays havoc on an organization is not much of a rocket science to understand – Money and credit becomes
sparse in the economy during recession times forcing consumers to spend less and less, and only the most essential items are
retained in their purchase list, this in turn might effect your sales volume and consecutively your profit margin. Attracting
customers towards your business becomes a tougher proposition as consumers are looking for more “value for money”
propositions than ever, carefully pondering over each purchase decision. This in turn tends to make the competition in the
market fiercer as everybody shall now be fighting for a smaller pie. Weaker or not-so-stable companies might be also forced to
shut down. Recession also brings along her twin sister, inflation, which implies that your expenses shall go up. Everything
that you do in the normal course of business shall cost you more money now. You will be forced to prioritize your expenses in
the order that they affect the sustainability of your business the most. In terms of priority of expenses, the ones that you incur
on maintaining and developing the Human Resources of your company comes first, and here again the people in your
company might be demanding more and more from you in terms of pay since during recession times the cost of living for an
individual goes up significantly and they need more money on them to survive. Hence it's only obvious for companies during
such recessionary times to retain and aptly pay the best talent that they have and do away with the rest. And while we are
discussion all the increases in cost that a business has to face, we must not forget that during recession it becomes even tougher
for a business to get funds to run its operations since the people who give loans to a business revise their credit giving terms to
stricter levels and every loan application has to go through more and more scrutiny. Thus the vicious circle of managing
increasing expenses & grappling with dwindling finances continues to entrap a business.

The sooner the HR department realizes its role in solving this crisis, the faster a business can cope up with recessionary
impacts. The fact is that the HR department has to be the key player in the battle against recession, because Recession forces a
business to basically try and retain its basic components, is leaders and its key employees. HR needs to play the role of
gatekeeper in ensuring the organization reacts, but does not overreact, to the recession. To ensure sustainability, HR needs to
assist the organization to excise the fat but not the muscle, keep the DNA intact, protect the stem cells and build the immune
system.

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 As discussed earlier, during recession times a business is expected to experience a drop in sales, and the management
shall inevitably consider laying off its employees, especially the poor performers. While the necessity of such a measure
cannot be overlooked, we cannot simply be obtuse to the fact that doing so may have unnecessary consequences too. The
colleagues of the employees who have been given the sack will definitely feel demoralized and demotivated since they
will feel insecure about their own position in the organization. A way to counter this situation may be to keep the
channels of communication open and frank, people should be given honest answers to their queries that they might have
with regards to the drastic measures being taken to deal with the situation. This will lead to a better understanding level
between the different levels and people in the organization, which is crucial for the long term survivability of the
organization.

Its important for the HR department is to help maintain a calm atmosphere by role modeling an appearance of focus &
attention. This shall set an example for other managers as well as employees. The managers, through proper counseling,
must be made to understand that display of anger or other negative reactions can lead to stressful situations. Managers
must restrain any impulse to motivate by fear. Under stress they may tell employees that they could be the laid off if they
do not comply with management demands. If those orders are perceived as being unreasonable the high performing
employees will look elsewhere for work and the other employees will tend to "duck their heads" and try to keep out of
sight. Fear corrupts organizations.

Also to be taken care of is the corporate image and decency of the organization while playing the hire and fire game. It
might reduce the “employer brand” of the organization, i.e fresh or existing top talent in the industry might not consider
joining you, if you project yourself as a hire & fire type of an organization. If a company goes on to fire a huge number
of employees during recession to justify the need for survivability, it might be branded as a reckless and heatless
organization by the masses. This is something that the organization must avoid at all costs, since its more often the
brand image that attracts customers to a product/service than perhaps its actual value. So if the image of the company is
tarnished in the eyes of the public, all its brands shall go for a toss, and competition shall swipe the markets clean of
your customers. So it's mandatory to be justifiable and transparent in whatever firing or retrenchment policies an
organization adopts during recession. A better alternative to recklessly firing people during recession would be enforcing
a temporary freeze on the services of certain people by either benching them. At least that way you'll have people to go
up to when the situation improved and you need more manpower to handle all your activities.

In these times the right people does become more than a necessity - they become crucial. In prosperous time it's easy to
get a job. Often you hire people you are not quite certain are capable of doing the job, but you need to cover the
resource gap somehow. Now you need people who have the will to keep fighting. The leadership profile changes too. It
takes a different kind of leader to drive a company, department or team during tough times, an Optimist with a touch of
realism. In fact recession can be a good time to hire top talent into an organization. It's during these times that the
people start feeling insecure about their position in the organization and they are on the lookout for more stable and
lucrative offers to hold on to. While the HR department can rightly tap into this opportunity, it must first make
necessary amends and provisions to ensure that the top talent in the organization is retained well. For this another
prerequisite is the presence of a healthy and efficient appraisal system in the organization. Top talent must not only be
recognized, but also must be rewarded and nurtured to retain it.

It's also crucial for the HR department to ensure that management of current manpower of the organization is done in a
sensible manner. Training expenses are the first to experience the cut during tough times, since it's said that they do not
yield immediate benefits and that the organization must concentrate all its efforts on staying afloat. Whereas doing so
might yield temporary benefits, but if this pattern is sustained then the organization might find itself totally unprepared
for the changed environment once the period of recession has lapsed, which might put a question mark on the long term
survivability of the organization. Instead of cutting back on training expenses, management should be wise in retaining a
few key employees and training them hard to cope up with the shortage in manpower as well as dealing with a dwindling
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 customer base. Increases focus on training shall also make the current crop of employees feel motivated since they will
be paid more attention and their work-skill requirements shall be taken care of.

More focus should be laid on the cross-divisional and cross-functional employment and deployment of people in the
organization. Its crucial that the people in the organization must be made to acquire a wide range of skill set during
these times, so that they can very well be deployed to cover up for the loss of manpower in a certain division/function.
This can be a better alternative to scouting for manpower during tough times, which can be really expensive.
In many developed countries, the ones worst hit by recession, more than half of the company's costs are on salaries and
benefits. In this regard an intelligent thing to do would be to increase the proportion of variable pay to fixed pay in the
total remuneration of the employees. The simple logic behind this being the fact that variable pay is based on
performance and during tougher times employee performance can play a vital role in the organizations' survival.
A notable amount of expenses that employees incur to the companies comes in the form of usage of office stationary and
facilities (telephone bills, fax bills, printing expenses etc). These are areas where HR should be more proactive in
reducing the superfluous amount of costs being incurred. Similarly the HR department must itself be responsible in
removing any HR function/ process that does not add any notable value to the organization. Employee engagement
schemes must be oriented more towards providing employees with positive and honest feedback & recognition for their
performance rather than on giving them material rewards for the same. Incentives should be given to only the people
who really add on to the value generation process of the organization.

With a calm and focused approach to problem solving, the HR department can very well steer an organization out of
troubled waters and actually be the key player in ensuring the long term profitability and survivability of an organization
during recession.

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 Emag!ne would like to thank Ms. Pritha
Basu for being the quizmaster for this
edition of Q- Quotient.
DECEMBER Q-QUOTIENT :HOTCH-POTCH
Answers to November 1)If Letika Saran is the second woman to head a state police
force,who was the first?
Q-Quotient-
1. Count Ferdinand Von 2)Jindal Steel and Power Limited(JSPL)has tied up with which US
based firm to develop and operate underground coal mines?
Zeppelin
3)If Brazil and Vietnam are the top two coffee producers of the
2. Ireland world,then who ranks third according to International Coffee
Organisation(ICO)?
3. River Rhine 4)Who did Rajendra K.Pachauri(on behalf of IPCC)share the podium
with to receive the Nobel Peace Prize in 2007?
4. Benelux countries
5)Recently,BHARTI AIRTEL has picked up a 70% stake in a leading
Bangladesh telecom company.Which is it?
5. English channel
6)On which planet do one witness sunrise in the west?
6. Amsterdam
7)Who was the first recipient of DadaSaheb Phalke award?

7. Sweden 8)1st December is dedicated to the worldwide awareness of which

disease?
8. Ytterby 9)Chi-Chi,a newcomer to the London Zoo,immediately became the
symbol of an international organization formed in 1961.Name the
9. Romanov organization.

10)Which Parliamentary constituency in India was the capital of the

10. Magellan Ferdinand Kakatiyas?

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 This month’s Ace the Case section has
two of our friends
Ms. Kirti Agarwal, & Ms. Malini Sengupta
preparing the case study for us.
The answers to the questions posted at
the end
of this case study shall appear in the next
issue of E-mag

NOVEMBER ACE-THE-CASE SOLUTIONS

Answer to Question No.1

As a Human Resource Manager I would first address the employees dissatisfied with the annual increments
based on the performance appraisal of the employees in the organization, saying that annual increments cannot
be granted automatically as it would be against the

1. work culture of the company

2. effect the productivity of the company negatively;
3. At the same time, it would be unjustified for the people who have worked hard.

But at the same time empathising with the employees, I would assure them that no weightage would be given to
the parameter of community service in the performance appraisal system, determining the granting or
withholding of increments and promotion of meritorious staff. Rather this parameter would only be considered
for development purposes henceforth.

Also I would like to undertake a communication exercise where employees' suggestions would be taken on how
the appraisal system can be improved. Some of the good suggestions could then be built into the system. This
communication exercise will help to emphasise that performance based increments, promotions and
development planning are necessary to take the company forward in the competitive environment in which the
company operates.

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Answer to Question No.2
No I do not agree with the chief executive's view that performance appraisal should be discontinued, because the
organizational health and survival depends on the performance of its employees, and the appraisal of this
performance steers the organization in the right path to attain its goals and objectives.
Moreover the annual increments given, based on a standard measure of performance, serves as a motivator for the
employees to work harder and contribute towards the growth of the organization.

Additionally performance appraisal not only helps in rewarding and motivating employees but also in training need
analysis, career and succession planning etc. which are all imperative to the growth of an individual at work. Thus
Performance Appraisal has several benefits as listed below:
* Focuses on results, rather than behaviors and activities.
* Aligns organizational activities and processes to the goals of the organization.
* Cultivates a system-wide, long-term view of the organization.
* Produces meaningful measurements.

In the view of the above benefits, performance appraisal should not be discontinued.

Answer to Question No.3

The graphic scale of performance appraisal used in the company is a traditional method of appraisal which has
various limitations such as rater bias, subjectivity etc.
Moreover all the parameters used for evaluation are very subjective. Instead some objective measures such as:
# Job knowledge
# Punctuality
# Proficiency in Resource utilization
# Quantity and Quality of work done/Work attitude
must also be used in order to reduce subjectivity.

Even the 2-person evaluation team is very inadequate. The appraisal should be done by the immediate supervisor,
the HR and then vetted out by a senior manager.

The appraisal system in Unique Funds Limited could also be upgraded to suit the needs of the employees as well as
that of the organization by combining the graphic scale technique with the critical incident technique which will
then be called BARS (Behaviourally Anchored Rating Scale).
BARS focuses on behaviors that are determined to be important for completing a job task or doing the job properly,
rather than looking at more general employee characteristics (e.g. personality, vague work habits). Behaviorally
Anchored Rating Scale (BARS) is job-specific, or at least occupationally specific. BARS is developed to eliminate the
worst inherent features of graphic rating scales.
Therefore in case of Unique Funds it will help to reduce employee grievances with respect to performance appraisal
parameters and make it more relevant and acceptable. The steps followed in construction of BARS are as follows:
1. Examples of effective and ineffective behavior related to job are collected from people with knowledge of job.
2. These behaviors are converted in to performance dimensions.

3. A group of participants will be asked to reclassify the incidents. At this stage the incidents for which there is not
75% agreement are discarded as being too subjective.

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 4. Then the above mentioned incidents are rated from one to nine on a scale.
Finally about six to seven incidents for each performance dimensions- all meeting retranslation and
standard deviation criteria will be used as BARS.

DECEMBER ACE-THE-CASE
The Absentee Employee
The National Transport Corporation (NTC), a leading transport organization with a fleet strength of 200 vehicles is
engaged in Parcel Service in South India. The NTC has its headquarters in Chennai, and has branches in important
locations in Tamil Nadu and other southern states.

Madhavan, a load man of NTC at Salem was transferred from Salem to Madura, for long absence from work in the
beginning of 1995, though the Corporation could have discharged him from service without permission for a period of
two months. The Branch Manager of Salem NTC requested the Head of HR Division to transfer the employee to
another location to enable the employee to correct himself in future. Madhavan has been in NTC from the beginning of
1992.

Madhavan reported for duty at Madura, and again after six months started absenting from work as before. The Branch
Manager of Madura counselled him several times, but Madhavan did not show any real change in attitude. A written
warning was given to him in October 1995. He again absented himself from duty for ten days from 17th December 1995
and after joining duty, he was again absent for twenty days which led to initiation of disciplinary action.

At the departmental enquiry held in February 1996, the delinquent employee pleaded that he was suffering from
jaundice and that he rushed to his village near Salem for taking Ayurvedic treatment and rest. No medical certificate was
produced. He admitted mistake in not applying for leave, and requested for mercy. Based on the admission of the
misconduct, the enquiry officer gave the findings that he was guilty. The Branch Manager, Madura was informed about
the findings. He recommended the dismissal of Madhavan.

The Chief Executive of NTC, the final authority however again directed a transfer to Madura, rather than passing an
order of dismissal. This was done to enable the employee to correct himself.

After issue of orders, the delinquent approached the Chief Executive of NTC amd requested for mercy. The Chief
Executive was not in favour of changing the order of transfer. He however referred the matter to the HR Division for
proper disposal.

The Manager HRD called Madhavan and asked for the reasons for absence. He asked the delinquent how the company
would tolerate such absenteeism. Madhavan was asked why he failed to produce medical certificates, if he was really
sick. Was he not given an opportunity twice to correct himself, once by Branch Manager, Salem and later by Branch
Manager, Madura? Madhavan had no answer to these questions. He however requested the Manager to give him one
last chance. He had no complaints against the Branch Managers. The HRD Manager assured support to him if his
version was convincing. Madhavan then narrated him family background.

Madhavan's Family Background

He was born to Gundappan and Palaniammal. He had two elder sisters, f our elder brothers and another brother
younger to him. His sisters and two brothers were living separately after marriage. He got the job as a load man in NTC
in 1992 at Salem through his brother-in-law, another senior load man at NTC. Another unmarried brother of his, aged
33 was employed in a hotel and was living separately.

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He was living with his parents, a disabled brother aged 35 and his younger brother at Kamandapatti (Please refer Annexure A)
till the end of 1994 in the family house. He was the bread winner of the family.

Madhavan was now living at Omalur, with his wife Madhavi aged 22. Madhavi's tale was a tragic one. A native of
Taramangalam, 10 kms from Omalur, and her father was in the military and was no more. She was married in 1993 to her
father's sister's son Gopal. However she was ill treated by both her in-laws and her husband and deprived of her ornaments.
Disillusioned she applied for a divorce and got an alimony of Rs. 2000.These helped her to establish a small grocery shop at
Omalur settling down with her sister's family.

Here Madhavan developed intimacy with Madhavi much to the dislike of her sister and another Gunapalan, a person known
to Madhavan. Gunapalan wanted to marry Madhavi. But Madhavi had no interest in him. Gunapalan on this background
posed serious problems to Madhavi especially after Madhavan's transfer to Madura. Gunapalan was determined to win her
hand. He told her twice that she will have to forget Madhavan, or else she will have to blame herself for the consequences.
Threats followed.

Madhavan got a letter from Madhavi asking for protection. She had antagonised Gunapalan and could not completely rely on
her married sister. They should marry----she wrote to him. Madhavan reached Omalur to see that Madhavi's shop was
burgled by unknown persons. There was a rumour in the air that Gunapalan was behind everything.

Madhavan decided to marry Madhavi. He married her at the Madura temple and later went on a pilgrimage for a fortnight. He
however did not inform the NTC officials about his marriage. He never applied for leave as well during the marriage on 6th
January, 1996. What followed was the disciplinary action against Madhavan and his plea against transfer.

The HRD Manager's Decision

Madhavan gave a definite undertaking to the Manager that he would be diligent in the work in future and that the
Management may terminate his services upon any complaint in future. The Manager HRD, contacted the Branch Managers
of Madura and Salem and took them into confidence. The family background was fully explained to both the Branch
Managers. It transpired that Madhavan had never explained his problems to either of them. Both Managers agreed to abide by
the decision of the Manager HRD to help Madhavan. Both promised to counsel Madhavan as well if he were posted either at
Madura or Salem.

The Manager HRD taking into account his family background passed an order transferring Madhavan to Salem.
Annexure A: Location chart

NTC Salem

11km
s
KAMANDAPATTI
PULIAMPATTI
1km
1km
N
OMALUR

10 km

S
TARAMANGALAM

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Annexure B: Provisions in the Standing Orders

Habitual absence without leave or absence without leave for more than 10 days.
Punishment- An employee who is found guilty of a misconduct maybe punished as provided herein, depending upon the
gravity of the misconduct committed by the employee.
1. Fine upto 2% of monthly salary
2. Warning
3. Demotion
4. Stoppage of increment
5. Suspension for 30 days
6. Discharge or dismissal

The management has the right to transfer the employees from one branch to another, from head office to branches and
vice-versa for exigencies of service.

Questions:
1. What would be your stand on this issue as the Head of HRD Division of the organization?

2. Do you think that the employee cannot be corrected as he has absented continuously for long periods while at Salem
and Madura and that sympathy shown to him will amount to a premium on indiscipline, adversely affecting the corporate
image of the organization?

3. Are you of the view that it is possible to correct him by the theory of constructive discipline and if so how?

4. Are you of the view that you will have to adopt the stick method to prevent the disease of absenteeism spreading to
other employees?

5. Are you of the view that if you transfer him to his hometown Salem, Madhavan would prove himself to be a good
performer?

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As I write this edition of campus Bytes, we are already late into the first month of the first decade of
the 21st century. On behalf of the editorial team, I would like to do a bit of reasoning as to why with
each passing issue of E-mag!ne, delivery dates are getting more and more delayed. Its because of the
simple fact called - Progression of life!

How come such innocuous sounding reason be the cause of delay, you might wonder, isn’t it?

Well to be a bit more precise, E-mag!ne is about to complete one whole year of existence with the next
issue, i.e, January 2010. And with every Departmental Monthly we too have to pass on the baton to
our succeeding batch and move on in life. This process of transfer is indeed a vexing one for us
because we not only have to ensure that the responsibility of E-mag!ne falls in able and enthusiastic
hands but also have to see that the year long tradition is indeed sustained for a long time in the future
too. Current crop of People handling the creation of E-mag!ne get pulled in more and more in finding
the right people to take over this prestigious responsibility, and hence the normal process of the
creation of each new issue takes a bit longer. We hope that you do bear with us and continue
supporting us, for it is because of your support that we are what we are today.

Campus life this month that just went by was one filled with anticipation and enthusiasm,
anticipation in case of people who are appearing for the final placement interview’s and enthusiasm
in case of those who have made it through the campus selection process and are eagerly waiting to
step into the real corporate world outside, for some the journey has already started!

What could be evidently seen is the fact that people are trying to get the best out of their remaining
MHRM days. Classes became fewer, but people still would troop to college to either study in the
library or just meet up and gossip in the canteen. Also popular would be GD-PI practices for the
upcoming interviews. Christmas and New year Leave meant that campus life was markedly short this
month, but even then it was a eventful one!

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Dear E-mag!ne,
I appreciate the incremental endeavors
put in every month into making this
magazine a success
Wishing you all success!
Regards,
Malini Sengupta
(MHRM 2008-10)

The designing is superb ...Great Job done.

Me as well as the entire MHRM dept. is
proud of our E-Magazine Editors...
Kirti(MHRM 08-10)

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