Вы находитесь на странице: 1из 51

PROJECT REPORT P ERFORMANCE

MANAGEMENT SYSTEM

KUSHAGRA SAXENA
SUMMER INTERN 2005
PMIR 2004-06
XLRI JAMSHEDPUR

Page 1 of 51
ACKNOWLEDGEMENT
The two months summer training at Colgate Palmolive India Baddi Facility has been an
incredible learning experience. I thank Colgate Palmolive for giving me this opportunity
to work and learn with complete freedom and constant guidance.

This project could not have been completed without the constant support and guidance of
my project guide Ms. Poonam Sharma who always gave me her valuable time despite the
pressures of her job. I’m grateful to her for arranging meetings, sometimes at short
notices, with the HR managers of various factories operating in the region to aid in
effective benchmarking which was critical to the completion of this project.

I’m also thankful to Mr Pramod Pedgaonkar, Technical Training Manager, for sharing his
insights and vast experience in the field of Performance Management Systems. The final
project could not have shaped in this way without his encouragement, support and
guidance.

I’m grateful to Mr Dhiren Doshi, Associate Director – Organizational Effectiveness, New


Jersey, for providing invaluable inputs at the critical stage of project. His guidance and
knowledge sharing was of immense help in aligning the Performance Management
System with the best Colgate Practices across the globe.

A special note of thanks for Mr. Manu Mehrotra, Facility Head and Mr. V Sriram,
Operations Manager, for their timely interventions that provided structure and direction
to the project.

I thank the entire Colgate Palmolive India Baddi Team for their support and
encouragement all through the project. There was never a moment where I felt like an
outsider.

Lastly, I thank Mr Debashish Roy, VP HR and Ms. Sonali Mathias, Manager – Training,
for the constant support and encouragement from the Head Office.

Kushagra Saxena

Page 2 of 51
PREFACE

It was a great pleasure and incredible learning experience working with Colgate
Palmolive India on this project of “Developing Performance Management System” for
technicians and team members at the newly set up Baddi Facility.

The overlaying aim of this project was to develop a Performance Management System
that is easy to understand and simple to implement and at the same point of time is highly
structured, unambiguous and measures all competencies expected out of Colgate
Employees. The Performance Management System is aided by a variety of tools that
facilitate the smooth and structured functioning of the system.

I hope I have been able to match the expectations of Colgate Palmolive with regard to my
work and attitude during the internship. I look forward to feedback regarding the project
and my performance during the period of my internship.

Kushagra Saxena
PMIR 2004-06
XLRI, Jamshedpur
Phone: 9431302747
Email: kushagras.06@astra.xlri.ac.in
saxenakush@gmail.com

Page 3 of 51
METHODOLOGY

The process of developing Performance Management System involved broadly eight


steps taken over the period of approximately six weeks. These steps are described below:

Step I – Defining Scope and Expectations


The first step was to meet the Baddi Strategic Team and define the scope of the project
and clearly understand the expectations from the project. At this stage I was apprised of
the current status of the Factory which necessitated the prioritizing of the various
components of the project.
Due to absence of clear compensation and benefits policy and grade system policy, it was
decided that the project will entail research and recommendations on the same while the
Performance Appraisal System and Employee Recognition Schemes will be worked out
to minute details to facilitate its implementations as soon as possible.

Step II – Data Collection


Having set out clear expectations, the next step was to collect data relevant to
Performance Management System from the following sources:
1. Colgate Palmolive Factories in India
2. Colgate Palmolive Factories abroad
3. Benchmark Factories in Baddi and adjoining areas
4. Select FMCG factories across India

Step III – Benchmarking


The data so collected was collated and compared across categories and observations were
drawn. It was noted that most factories in India did not have structured Performance
Management System for worker category while this practice was actively followed in
Colgate Factories abroad. At best, the Indian factories had a highly subjective appraisal
process that was aimed at taking corrective actions.

Page 4 of 51
Step IV – Designing the Performance Appraisal System
After benchmarking the primary target was to create a Performance Appraisal System
that would be highly structured, unambiguous and will measure various competencies
expected from a Colgate Employee.
The Performance Appraisal System was broadly based on the international format
followed by Colgate with modifications to simplify and adapt it to Indian conditions. The
rating was reduced to three levels instead of four levels followed by Colgate to ensure
simplicity.
Various tools such as ranking meeting, skill inventory etc were designed to eliminate
rater bias. Concepts like Gating were introduced to ensure consistency in all aspects of
performance.

Step V – Linking Performance Appraisal System to other fields


Once the Performance Appraisal System was designed, its results were linked to the
following to ensure performance enhancement:
1. Compensation & Benefits
2. Training & Development
3. Employee Recognition Schemes
4. Grade System
As the policies for grade system and compensation & benefits were not clear during the
duration of project, the linkages were recommendatory in nature. Each linkage was
arrived at only after careful benchmarking across Colgate Worldwide, Colgate India and
Baddi Region.
Three detailed Employee Recognition Schemes were formulated to institute non monitory
recognition of good performance and behavior. These schemes aim at motivating the
employees to perform better and at the same time drive the Colgate Values, Baddi
Guiding Principles and team work

Step VI – Primary Presentation to Baddi Team & Incorporation of Inputs


Next, the Performance Management System so developed was presented to the Baddi
Strategic Team and their inputs were solicited. All the inputs were discussed and the

Page 5 of 51
changes required to the Performance Management System were noted down. These
changes were then incorporated in the Performance Management System.

Step VIII – Approvals


After incorporating all inputs, the project was presented to the Baddi Strategic Team for
approval. Upon their approval the project was presented to Mr. Debashish Roy, VP
Human Resources who gave his inputs. The project was closed after incorporating Mr.
Roy’s inputs.

Page 6 of 51
PERFORMANCE
MANAGEMENT SYSTEM

BADDI FACILITY
COLGATE PALMOLIVE (INDIA) LTD

Page 7 of 51
CONTENTS

INTRODUCTION 10
SCOPE 10
PERFORMANCE APPRAISAL SYSTEM 11
Performance Appraisal Criteria 11
Performance Appraisal Frequency 12
Number of Appraisers 13
Performance Appraisal Tools 13
Critical Incident Diary 13
Performance Appraisal Form 14
Evaluation Manual 14
Calculation Sheet 14
Skill Inventory 14
Ranking Meeting 15
Improvement Statement 15
Counseling Session 15
Review Session 15
Performance Appraisal Methodology 16
Performance Appraisal Feedback System 19
Scope for Future Modification 20
PERFORMANCE REWARD SYSTEM 21
Benchmarking 21
Performance Reward 21
Performance based Wage Increment 21
Productivity Bonus 22
Performance Reward System – Salient Features 23
LINKING PERFORMANCE APPRAISAL T&D 24

Page 8 of 51
EMPLOYEE RECOGNITION SCHEME 25
Team of the Month 25
Thank You Slips 27
Innovator Employee 27

RECOMMENDATIONS ON GRADE SYSTEM 29


Benchmarking 29
Merits & Demerits 30
Recommendations 30

ANNEXURE
Annexure 1 – Critical Incident Diary 31
Annexure 2 – Performance Appraisal Form 35
Annexure 3 – Evaluation Manual 39
Annexure 4 – Ranking Meeting Guide 45
Annexure 5 – Skill Inventory 49

Page 9 of 51
INTRODUCTION
Performance Management System is critical to functioning of any organization. In
Colgate Palmolive India Baddi Facility it is of paramount importance to measure the
performance of the technicians and team members as these are the people who will
actually drive the production from the front. The performance so measured and appraised
will then form basis of various other HR functions like compensation & benefits, career
growth, training and development etc.

SCOPE
This performance management system covers the following areas:
1. Performance Appraisal System
2. Linking PA to Training & Development
3. Linking PA to Performance Pay/Bonus
4. Recommendations on viability and need of Grading System within
technician/team members
5. Linking PA to Grade System, if recommended
6. Other Performance Enhancing Measures – Recognition Schemes

While the Performance Appraisal System, Recognition Schemes & Performance


Appraisal linkage with Training & Development is covered in great detail and depth, the
other aspects of Performance Management System are contingent on policies that are yet
to be formulated by the head office (for example compensation & benefits policy for
Baddi) and are thus dealt in relatively less detail.

Page 10 of 51
PERFORMANCE APPRAISAL SYSTEM
Performance Appraisal System measures the performance of workers on variety of
parameters; document it on an easy to understand form, establish clear guidelines to
perform the appraisal and finally, institute a feedback mechanism to communicate the
results of appraisal and suggestions to the employees. The Performance Appraisal will
lead to the banding of the technicians/ team members into “Below Expectations”,
“Meets Expectations” or “Exceeds Expectation” on the basis of final percentage score
attained by them.

PERFORMANCE APPRAISAL CRITERIA


The performance of the technicians and team leaders will be appraised under the
following three broad categories:
1. Functional Competency:
This category consists of all work related competencies displayed by the
employee. Work of each department is broken down into five functional
competencies that are critical to smooth performance of the department. These
five functional competencies can be modified periodically as the factory evolves.

Functional Competency carries a weightage of 50% in the Performance Appraisal


System.

2. Quantitative Measures:
The quantitative measures represent that part of the Performance Appraisal
System which will constantly change as the factory evolves. In the beginning the
quantitative measures will consist of the attendance and punctuality record of the
technicians/ team members. Once the desired level of attendance and punctuality
is achieved and is stabilized, the quantitative measures can be changed to include
some other critical factor that needs reinforcement. (For Example, if adherence to
safety standards is not up to the mark, PPE compliance can be introduced as a
quantitative measure.)

Page 11 of 51
Quantitative Measures carry a weightage of 25% in the Performance Appraisal
System.

3. Adherence to Baddi Guiding Principles:


This section of Performance Appraisal System will measure the behavioral aspect
of performance of technicians/ team members. The emphasis of this section will
be on:
o Housekeeping
o Personal Hygiene
o Waste Management
o Team Work
o General behavior exhibited at work
In addition to the above five categories, deviation on any other behavioral
parameter will be measured under this section.

Adherence to Baddi Guiding Principles will carry a weightage of 25% in the


Performance Appraisal System.

PERFORMANCE APPRAISAL FREQUENCY


The Performance Appraisal process will run twice a year and the results of the
Performance Appraisal will be declared on 31st January and 31st July of every year. The
process of the appraisal will be based on continuous evaluation as described in the
Performance Appraisal Methodology section. The time lines for submission of
Performance Appraisal are as follows:
Performance Appraisal Timelines
Distribution of Forms 31st June & 31st December
Submission of Completed Forms to HR Department 15th July & 15th January
Declaration of Comprehensive results 31st July & 31st January

NUMBER OF APPRAISERS

Page 12 of 51
All performance appraisals of technicians and team members will be carried out jointly
by two appraisers – the team leader of the appraisee and the PMS Facilitator. The PMS
Facilitator will be part of the process only for the first few years to guide the appraisal
process in the right direction. Once the Performance Appraisal System has stabilized, the
team leader will carry out the appraisal alone.

PERFORMANCE APPRAISAL TOOLS


• Critical Incident Diary
• Performance Appraisal Form
• Evaluation Manual
• Skill Inventory
• Calculation Sheet
• Ranking Meeting
• Feedback Tools:
– Improvement Statement
– Counseling Sessions
– Review Session

CRITICAL INCIDENT DIARY1


The Critical Incident Diary forms the basis of the whole appraisal process. Critical
Incident Diary is an instrument to continually record technician/team member’s
deviations (positive as well as negative) from expected behavior and links such deviation
to relevant guiding principle. Every technician/ team member will have a page dedicated
to him in the Critical Incident Diary and all observations will be noted down there.

PERFORMANCE APPRAISAL FORM2

1
Annexure 1
2
Annexure 2

Page 13 of 51
The performance appraisal form has been designed to make the process of appraisal
uncomplicated, easy to understand and less time consuming. The form is divided into the
following six parts:
1. Functional Competence
2. Quantitative Measures
3. Following Our Guiding Principles
4. Final Rating
5. Improvement Statement & Comments
6. Signatures
The exact procedure of arriving at the rating is detailed under Evaluation Manual.

EVALUATION MANUAL3
The evaluation manual details the exact procedure of filling up the Performance
Appraisal form and arriving at the rating of the employee. It explains the contents of
appraisal form and the way to fill each section in a lucid and objective language. It will
be essential for the appraisers to understand the evaluation manual and conduct the
appraisal only as described in the evaluation manual so as to maintain uniformity and
fairness in the appraisal.

CALCULATION SHEET
The calculation sheet is a Microsoft Excel spreadsheet which aids the team leaders to
calculate the rating of the employee once the scores have been determined. The sheet is
semi automated and gives the percentage score and pre-gating rating for each individual
once the raw scores of all components have been entered.

SKILL INVENTORY4
The skill inventory is a detailed document containing the list of various functional
competencies required by technicians/ team members in different departments. It lists
down the functional descriptor, i.e. statements describing what constitutes

3
Annexure 3
4
Annexure 5

Page 14 of 51
Exceeds/Meets/Does Not Meet Expectation for each functional competency. The skill
inventory will aid in bringing uniformity in ratings and removing rater bias.

RANKING MEETING
The ranking meeting will take place one all the Performance Appraisal forms have been
filled up and the preliminary ratings have been assigned. The ranking meeting will bring
uniformity in the ratings and will ensure that all S&C members and team leaders agree
with the ratings given to the technicians/ team members. This will go a long way in
establishing the credibility of the Performance Appraisal process. The exact procedure of
conducting ranking meeting is detailed under Ranking Meeting Guide5.

IMPROVEMENT STATEMENT
The improvement statement is a part of the Performance Appraisal Form which lists
down the various areas of improvement of the appraisee agreed upon between the
appraiser and appraisee during appraisal. Improvement statement is dealt with in great
depth in Evaluation Manual.

COUNSELING SESSION
Counseling sessions will be held before the ranking meeting. Both the appraisers and the
appraisee will attend the session and discuss the performance of the appraisee. The
improvement statement will be filled during this session. The ratings will be decided but
not revealed to appraisee during this session.

REVIEW SESSION
Review session will be held after the ranking meeting. This session will be attended by
the HR Manager, Function Head and the Appraisee will involve reinforcement of
counseling session, revealing the final rating and brief discussion on performance and
improvement statement of appraisee.

PERFORMANCE APPRAISAL METHODOLOGY

5
Annexure 4

Page 15 of 51
The primary aim of this Performance Management System is to make it easy to
understand while maintaining its objectivity and exhaustive nature. The appraisal process
needs to be extremely concise and less time saving to ensure its effective implementation.
The following are the steps to be followed for the Performance Appraisal mechanism:

1. Explaining the Performance Appraisal Mechanism to Employees:


Before the actual implementation in the first year and in the beginning of every
subsequent appraisal period, all concerned employees – technicians and team
members & the appraisers will attend a session on Performance Appraisal
objectives, methodology and rationale. They will be explained what is expected
of them under each head in the Performance Appraisal form. All doubts and
issues must be cleared during this session.

2. Critical Incident Recording


A Critical Incident Diary in the prescribed format will be provided in each
department where the technicians and team members are employed. The
guidelines for Critical Incident Diary recoding are as follows:
a. Critical Incident Diary will be primarily maintained by Team Leaders.
S&C members can also record entries in Critical Incident Diary whenever
they notice a critical incident.
b. All significant instances of deviation from the standards must be recorded
in the Critical Incident Diary.
c. All deviations – Negative as well as Positive must be noted down. The
Performance Appraisal System is not only corrective; it is also meant to
recognize high performers.
d. Efforts should be made to record the deviation against the relevant guiding
principle however in case it is difficult to link it to guiding principle, the
incident should be noted in any row.
e. All critical incidents should be recorded in real time. i.e. The observer
should record the incident as soon as it occurs. The Critical Incident Diary
updating should not be a day end activity.

Page 16 of 51
3. Filling Performance Appraisal Form
The procedure of filling up the Performance Appraisal form is detailed in the
evaluation manual that would be provided to each appraiser for reference. The
following guidelines must be complied with while filling the form:
a. Team leaders must thoroughly go through the evaluation manual
provided with the appraisal form and fill the form exactly in the manner
described in the manual.
b. All team leaders should thoroughly go through the Critical Incident Diary
once the Performance Appraisal Forms are distributed and fill in the rating
on the form on the basis of such critical incidents.
c. The rating should not be affected by the personal judgments of the team
leaders. Each rating must be backed by clearly written down critical
incidents. The facility head and/or manufacturing/production/HR
Managers can ask team leaders to justify the rating given on the basis of
written down critical incidents.
d. During the form filling exercise the appraiser will keep the skill
inventory6 and as a reference guide to decide on the rating of employee on
various functional parameters.
e. Last year’s improvement statement should be kept as a reference to track
targeted improvements.

f. Gating Concept:
The gating concept, as explained in the evaluation manual, states: No
employee will get an overall rating greater than or equal to “Meets
Expectation” unless the ratings in all three components are at least
“Meets Expectation”
This concept ensures that no employee will get a favorable rating due to
his exceptional performance in one component of Performance Appraisal
Form when the performance in some other component is dismal.

6
Annexure 5

Page 17 of 51
4. Counseling Session
Once the appraisers have finalized the ratings, the counseling session will be held
and the performance will be discussed with the appraisee. The counseling
session will be conducted as described in the following section on feedback tools.

5. Form Submission:
Completed form (with improvement statement & signatures of appraisers and
with final rating in pencil) should be forwarded to the HR department. The HR
department will then collate all data and make necessary preparations for the
ranking meeting.

6. Ranking Meeting:
Once all appraisals have been completed and the data has been submitted, the HR
department will convene a Ranking Meeting. In the ranking meeting all
relevant S&C members will discuss the ratings assigned to technicians and team
members and seek clarifications and make the necessary corrections. This meeting
will ensure the consensus of all relevant S&C members on the ratings and will
reduce rater bias. The procedure to conduct the ranking meeting is detailed in the
Ranking Meeting Guide7.

7. Review Session – Final Rating & Feedback:


After the conclusion of the ranking meeting, the final ratings of the technicians
and team members will be frozen and put down on the form. Thereafter the
review sessions will be conducted as described in the following section on
feedback tools.

8. Signatures:

7
Annexure 4

Page 18 of 51
At the end of the review session the appraisee and the function head will sign the
form and submit it to HR Department for compilation and declaration of various
Performance Management System results.

PERFORMANCE APPRAISAL FEEDBACK SYSTEM:


Performance so appraised should be communicated to the employee and comprehensive
feedback must be given so as to suggest & explain the ways to improve the performance
and appreciate good work. This feedback mechanism will work in the following manner:

1. Personal Counseling Sessions:


Every employee will have counseling session with his team leader on the
appraisal in presence of the PMS Facilitator. The appraisers will discuss the
achievements and shortcomings of the appraisee. The team leader will appreciate
the positive incidents and provide guidelines to improve the performance in the
problem areas. Employee’s performance on each Performance Appraisal criteria
will be discussed and explained to the employee. The preliminary ratings will be
finalized at this stage but will not be revealed to the appraisee as the rating might
change after the ranking meeting.

2. Improvement Statement:
A written statement will be prepared by the technicians/ team members in
consultation with the team leader & PMS Facilitator detailing how they intend to
improve their performance in the next appraisal period. This improvement
statement will be noted down in the space provided in the form.

3. Review Session:
The review session will be attended by appraisee, the HR Manager and the
Function Head. The HR Manager and the Function Head will briefly discuss the
achievements and the shortcomings of the appraisee and will also discuss the
special points raised in the ranking meeting, if any. Thereafter the ratings will be
revealed to the appraisee and the form will be duly signed by all concerned. The

Page 19 of 51
purpose of this session is to reinforce the feedback given in the counseling session
and to discuss things beyond performance appraisal. The ratings assigned in the
ranking meeting will not be changed during this review. Once the Employee
Satisfaction Survey has been instituted in the factory, its findings can also be
discussed at this stage.

4. Dissatisfaction with Appraisal:


If any technicians/ team members is dissatisfied with his appraisal and has
sufficient reason to believe that there is inaccuracy in the appraisal, he can take up
the issue with manufacturing/production/HR manager.

SCOPE FOR FUTURE MODIFICATION


The Performance Appraisal System can be modified anytime by adding/altering
components of the behavioral and functional categories. The weightage of various
components can be varied according to the observations made as the plant evolves.

Page 20 of 51
PERFORMANCE REWARD SYSTEM
BENCHMARKING
A detailed study was carried out in the Baddi Industrial Area to understand the practices
followed to link performance with compensation. The performance pay policies of other
Colgate Plants in the country were also studied. Broadly two conclusions can be drawn
from the study:
1. All companies have some component of pay linked to performance
2. The performance pay is of two types:
a. Performance Bonus linked to appraisal results or overall plant productivity
b. Performance based wage increments

PERFORMANCE REWARD SYSTEM


The compensation of the technicians/ team members will be linked to the performance by
two components:
1. Individual Performance based wage increments
2. Plant Productivity based bonus

PERFORMANCE BASED WAGE INCREMENT


The yearly wage increments will be dependent on the individual performance of the
technicians/ team members. The wage increments will be decided as follows:
• Decide Average Increment figure every year
• Decide Individual Increment based on normal curve
o 3 Bands of increments based on Performance Appraisal percentage score
o Top 15% - Middle 70% - Bottom 15%

Average
Low Performers High
Performers Performers

Page 21 of 51
• Middle Band gets the pre decided average increment
• Top and bottom Bands get higher and lower increments respectively
• Overall decided average maintained

Rationale
The performance based wage increment is based on the following rationale:
• Results in permanent change in Income Level – Strong Motivator
• Clear difference in pay level of consistent performers & non performers in long
run
• Helps recognize & retain the best talent

PRODUCTIVITY BONUS
The second component of performance reward system, Productivity Bonus, will be linked
to the overall plant performance. It will be decided as follows:
• Flat rate of bonus for all technicians and team members on basis of Plant AU
• Certain minimum acceptable AU level will attract zero productivity bonus
• Every percentage point over such level leads to increasing productivity bonus
For example,
Asset Utilization (%) Productivity Bonus
>= 65 0
66 500
67 525
68 550
69 575
… …
88 1450
89 1475
90 1500

Rationale
The productivity bonus is based on the following rationale:
• Links overall performance to reward

Page 22 of 51
• Promotes overall teamwork
• Sets clear motivation for increasing productivity
• Peer Pressure – Performers will automatically check non performers

PERFORMANCE REWARD SYSTEM – SALIENT FEATURES


• Enhances individual performance
o Directly links Performance Appraisal results to Salary Structure
o Permanent Change
• Enhances performance as a unit by linking AU to bonus
o Promotes coordination and instills a sense of responsibility
o Temporary Change

LINKING PERFORMANCE APPRAISAL TO T&D

Page 23 of 51
The performance appraisal results so obtained will be used to determine the training and
development needs of employees. The following three step process will be followed to
ensure that Performance Appraisal results are actively linked with Training &
Development:

1. The HR department will review the completed Performance Appraisal forms to


filter out all forms where:
a. Overall Rating is “Below Expectation” and/or
b. Rating in any functional or behavioral competency is “Below
Expectation”
These shall be the employees who need training in various fields.

2. The forms so filtered out will then be analyzed to establish any possible trend in
lack of competencies. If more than 10 people exhibit the lack of same competency, a
mass training need exists. For example, if 13 people are scoring “Below Expectation”
in the Making department, there exists a specific need for refresher training in the
making concepts.

3. The list of the employees in need of training along with established trend, if any,
will be forwarded to the Training & Development department for further action.

EMPLOYEE RECOGNITION (NON MONITORY) SCHEMES

Page 24 of 51
The following schemes aim at giving due recognition to the employees who exhibit
desirable functional and behavioral competencies. Apart from driving the BFAs and
Guiding Principles, these schemed will prove to be positive motivation tools and will aid
in preventing monotony on the shop floor.

1. Team of the Month


Concept
Every month a team of the month will be decided on objective and measurable
basis. The distinction will not fetch any monitory reward but will act as an
important motivator for the employees.

Purpose
• Reinforce the concept of team work
• Motivate employees to perform better
• Addresses the need for recognition
• Will ultimately lead to increased individual & team performance

Evaluation
Every month the employees will be rated individually on the following
parameters and the cumulative score of each team will be calculated to determine
the team of the month:
Criteria Weightage
Attendance 15 Marks
Punctuality 15 Marks
EOHS Compliance 15 Marks
Adherence to BFA, Guiding Principles 25 Marks
Team Work (Same for all team members) 30 Marks
Total 100 Marks

Attendance: Every employee will start at a score of 12 and a score of –2 will be


awarded for every uninformed/unjustified absence. A score of +3 will be awarded
for full attendance.

Page 25 of 51
Punctuality: Every employee will start at a score of 15 and a score of –2 will be
awarded for every incidence of late coming.

EOHS: Every employee will be judged by his team leader on the EOHS standards
followed by him, including safety violations if any. Critical incidents must be
noted down to substantiate the rating.

Adherence to BFA, Guiding Principles: Every employee will be judged by his


team leader on the adherence to BFA & Guiding Principles. Critical incidents
must be noted down to substantiate the rating.

Team Work: Every team will be judged by its team leader on the team work
displayed by it. Critical incidents must be noted down to substantiate the rating.

Note: The absolute value of all the positive and negative scores assigned to
various critical incidents for the last three parameters will be decided by the team
leader on the basis of its importance and gravity.

Reward
1. Display the name and photographs of all team members at prominent place for
one month
2. Public announcement of result – Applause & Appreciation
3. Lunch with the facility head, production manager and team leader

2. Thank You Slips


Concept
Each time an employee is helped out of the way by some other employee; he will
write a thank you note describing the incident in brief and will put the note in the

Page 26 of 51
“Spread a Smile” box. At the end of the month the box will be opened and the
person with highest number of slips to his credit will get an appreciation gift.

Purpose
• Promote culture of team work beyond teams
• Promote spirit of helpfulness
• Recognize and reward people who go out of the way to help others
• Motivate employees to display desired behavior

Evaluation
• Simple counting of thank you slip.
• The team leader will keep a track of the reasons stated and prevent any
carteling/foul play.

Reward
1. Gift pack containing toothpaste/toothbrush etc and an exclusive “spread a
smile” keychain
2. Display the name and photographs of the winner at prominent place for one
month
3. Public announcement of result – Applause & Appreciation

3. Innovator Employee
Concept
Employees develop certain skills as they gain work experience. It may be an
innovative way of doing the same job or any other activity that enhances the
speed or productivity. An innovator employee would be one who has developed
such unique skill and trains the other employees on the same.

Purpose
• Sharing of useful knowledge

Page 27 of 51
• Reinforce the core value – continuous improvement
• Avoidance of “reinventing of wheel”
• Recognizing and appreciating the employee who develops such unique skills

Evaluation
The employee will first explain the skill/method to the team leader. If team leader
is convinced that it indeed is helpful to increase productivity and/or reduce time,
he will christen the employee as “Innovator Employee” and schedule training
sessions.

Reward
• Recognition as “Innovator Employee” & opportunity to showcase their learning
• Display the name and photograph of the innovator employees along with their
contribution at prominent place for one month
• “Innovator Employee” key chain

RECOMMENDATIONS ON GRADE SYSTEM

BENCHMARKING

Page 28 of 51
A detailed study on the grade system prevalent in various industries in Baddi, Colgate
plants in the country & some other FMCG plants across the country was carried out. The
results of the study are summarized below:

Sl Company Grade No Of Basis of


No Name Location System Grades Promotion Observations
1. Responsibility of work
lies with upper grades
2. Lower grades at times
exploited by upper grades
3. Same work but clear
1 Dabur Baddi Yes 3 Performance "perceived" growth path
1. Completely flat
structure for 9 years
2. Differentiation only in
terms of performance
linked payscales
3. Workers percieve
growth in terms of
performance pay and the
Unichem start performer respect
2 Pharma Baddi No - - that comes along
1. Aims at providing clear
growth path
2. Each higher grade
comes with greater
responsibility and "higher
3 Joyco/Wrigleys Baddi Yes 5+8 Performance level" work
4 Pepsi Sangrur Yes 6 NA
Performance
5 Nestle Moga Yes 5 + Skill
1. Three levels within
Performance grades with seniority as
6 Morepen Parwanoo Yes 9 + Seniority pre requisite
7 HLL Rajpura Yes 4 NA
Indo-Gulf
8 Fertilizers Jagdishpur Yes NA NA

9 Godrej Mumbai Yes NA NA


1. Seniority is pre
requisite for promotion
irrespective of
performance
Seniority + 2. Some promotions only
10 ITC Bangalore Yes 14 Performance if vacancy exists

MERITS & DEMERITS


The relative merits and demerits of grading system in an organization are tabulated
below:

Page 29 of 51
Merits Demerits
• Provides clear Growth Path • Problems in Team Work
o Positive Motivator o Higher grade dominating lower
o Drives Performance grades
o Retaining Employees o “Status Difference”
• Addresses need for recognition • Rationale? (Same Work across grades)

RECOMMENDATIONS
On the basis of the benchmarking study, relative merits and demerits and discussions
with Baddi Management, the following recommendations are made on the feasibility of
grade structure in the Colgate Palmolive India Baddi Facility:
• Premature to introduce grade system
o Will hamper teamwork
o Unnecessary hierarchy
o At this point performance pay should be the only driver
o Let the need for grade system evolve
• Review: August 2007
o Review the situation
o Assess motivation and aspiration levels of technicians and team members
o Alter performance reward system OR introduce grade system as the need be

Page 30 of 51
ANNEXURE 1
Critical Incident Diary

Page 31 of 51
Employee Name: ________________________ Employee Code: ______

CRITICAL INCIDENT DIARY


Guiding Principle Date Critical Incident Name & Sign
Rank
Our People
• We value diversity of ideas and
approaches of individuals, treat them
with respect, dignity and mutual trust
• We affect positive change in the work
place by effecting positive change in
peoples lives

Business
• We are business focused and strive for
high standards of individual, team and
organization performance
• We are responsive and committed to
delivering cost competitive products
that meet high standards of quality and
customer satisfaction
Our Values
• We will demonstrate our fundamental
values of caring, global teamwork and

Page 32 of 51
continuous improvement in our day to
day interactions
• Integrity in all personal and business
interactions is the foundation of our
success
Our Environment
• Everybody is responsible and
accountable for creating and sustaining
a safe, healthy and clean environment,
both inside and outside the plant

Communication & Decision Making


• We communicate our expectations
clearly to our people
• We will openly seek and share
information and will challenge
ourselves to find better and more
innovative ways to excel personally as
well as professionally

GUIDELINES

Page 33 of 51
1. Critical Incident Diary will be primarily maintained by Team Leaders. S&C members can also record entries in Critical
Incident Diary whenever they notice a critical incident.
2. All significant instances of deviation from the standards must be recorded in the Critical Incident Diary.
3. All deviations – Negative as well as Positive must be noted down. The Performance Appraisal System is not only corrective;
it is also meant to recognize high performers.
4. Efforts should be made to record the deviation against the relevant guiding principle however in case it is difficult to link it to
guiding principle, the incident should be noted in any row.
5. All critical incidents should be recorded in real time. i.e. The observer should record the incident as soon as it occurs. The
Critical Incident Diary updating should not be a day end activity.
6. All fields in the Critical Incident Diary should be filled up. Incomplete entries do not solve any purpose and will result in
confusion while filling up the Performance Appraisal Form.

Page 34 of 51
ANNEXURE 2
Performance Appraisal Form

Page 35 of 51
COLGATE PALMOLIVE INDIA LTD BADDI
FACILITY

PERFORMANCE REVIEW FOR TECHNICIANS & TEAM MEMBERS

APPRAISEE’S NAME: _________________________________ EMP. CODE: ___________ DATE : _____________


DD/MM/YYYY

Date Of Joining : _____________ APPRAISAL: ROUTINE REVIEW APPRAISAL No : 2005 /

APPRAISERS' NAME: (1). _________________________________ (2). ___________________________________

Scoring Key:
Below Expectation – 2 Points Meets Expectation – 3 Points Exceeds Expectation
– 4 Points

1. FUNCTIONAL COMPETENCY –
(Weightage - 50%) |------------------Tick One---------------------|
Below Meets Exceeds
Core Skills Expectatio Expectatio Expectatio Comments
n n n

F1 -

F2 -

F3 -

F4 -

F5 -

Functional Rating (Tick One)


Percentage Score: [(F1+F2+F3+F4+F5)/20] x 100 = [(__+__+__+__+__)/20]*100 Below 65% : Below Expectation 

A= % 65% – 85% : Meets Expectation


Above 85% : Exceeds Expectation

Kushagra Saxena Page 36 11/2/2010


COLGATE PALMOLIVE INDIA LTD BADDI
FACILITY

2. QUANTITATIVE MEASURES
(Weightage – 25%) |------------------Tick One---------------------|
Below Meets Exceeds
Measure Expectatio Expectatio Expectatio Comments
n n n

Q1 – ATTENDANCE

Q2 – PUNCTUALITY

Quantitative Measures Rating (Tick One)


Percentage Score: [(Q1+Q2)/8] x 100 = [(__+__)/8]*100 Below 65% : Below Expectation 

B = % 65% – 85% : Meets Expectation


Above 85% : Exceeds Expectation

3. FOLLOWING OUR GUIDING PRINCIPLES


(Weightage – 25%) |------------------Tick One---------------------|
Below Meets Exceeds
Measure Expectatio Expectatio Expectatio Comments
n n n

ADHERANCE TO BADDI
GUIDING PRINCIPLES
Guiding Principles Rating (Tick One)
Percentage Score: [Score/4] x 100 = [(___)/4]*100 Below 65% : Below Expectation 

C = % 65% – 85% : Meets Expectation


Above 85% : Exceeds Expectation

Kushagra Saxena Page 37 11/2/2010


COLGATE PALMOLIVE INDIA LTD BADDI
FACILITY
4.
5. FINAL RATING Final Rating [After Applying Gating] (Tick
IMPROVEMENT STATEMENT
(A x 0.5) +(B x 0.25) + (C x 0.25) One)
D =  % Below 65% : Below Expectation
65% – 85% : Meets Expectation 

Above 85% : Exceeds Expectation 


GATING: If rating in any of the three components of Performance Appraisal is “Below Expectation”, then overall rating will be “Below
Expectation”

COMMENTS BY APPRAISER 1 COMMENTS BY APPRAISER 2 COMMENTS BY Function Head :

6. SIGNATURES DATE : _____________

APPRAISEES' SIGNATURE : ______________________ APPRAISERS' SIGNATURE : (1). ________________________

Function Head’s SIGNATURE : ___________________ (2). ________________________

Kushagra Saxena Page 38 11/2/2010


ANNEXURE 3
Evaluation Manual

Page 39 of 51
Evaluation Manual

This evaluation manual seeks to provide step by step explanation to fill up the Colgate
Palmolive India Baddi Facility performance review form so that there is consistency in
approach and complete understanding of each component. Both appraisers should go
through his manual thoroughly before appraising the performance of the employee.

The form is divided into the following six parts:


7. Functional Competence
8. Quantitative Measures
9. Following Our Guiding Principles
10. Final Rating
11. Improvement Statement & Comments
12. Signatures

The first four parts will constitute the Performance Appraisal evaluation. Each employee
will be rated on these parts and their sub components on a three level Rating scale:
Rating Points
Below Expectation 2
Meets Expectation 3
Above Expectation 4

The method for arriving at the rating is described in detail in the following pages.

1. Functional Competency
• Functional Competency will carry a weightage of 50% in the Performance
Appraisal
• Functional Competency will consist of Five Key Competencies that are essential
for performance of the job.
• Each department will have its own different set of five competencies.
• The employee will be given rating from 2 to 4 on each competency based on his
performance as judged by his team leader.

Page 40 of 51
• The team leader will maintain the critical incident diary throughout the appraisal
period and use the inputs noted there in consultation with the rating description
given in Annexure 18 to arrive at the rating of the technicians and team members.
• The overall functional score (in percentage) will be determined by the following
formula:
Percentage Score: [(F1+F2+F3+F4+F5)/20] x 100 =
[(__+__+__+__+__)/20]*100
A=  %
Where,
F1, F2…F5 = Scores in Functional Competencies
20 = Maximum Score
• The overall functional rating will be determined using the following key:

Below 65% Below Expectation


65% – 85% Meets Expectation
Above 85% Exceeds
Expectation

2. Quantitative Measures
The quantitative measures consist of Attendance & Punctuality and carry a weightage
of 25% in the Performance Appraisal. The rating will be determined according to the
following guidelines:
1. Attendance:
Below Expectation Meets Expectation Above Expectation
• Leave is excessive • Leave is not above site • Rarely takes leave
(above site av.) average • Goes out their way to
• Is poor at providing • Early notification of provide coverage
reasonable notice absence or lateness where required
2. Punctuality:
Below Expectation Meets Expectation Above Expectation
• Punctual start and • Is punctual with start • Starts early and
finish times are an and finish times finishes late where
issue required to ensure
smooth handovers
• The overall quantitative measures score (in percentage) will be determined by the
following formula:
8
Annexure 1

Page 41 of 51
Percentage Score: [(Q1+Q2)/8] x 100 = [(__+__)/8]*100
B=%
Where,
Q1, Q2 = Scores in Attendance & Punctuality respectively
8 = Maximum Score
• The overall functional rating will be determined using the following key:

Below 65% Below Expectation


65% – 85% Meets Expectation
Above 85% Exceeds
Expectation

3. Following Our Guiding Principles


• “Following Our Guiding Principles” will carry a weightage of 25%
• The critical incidents will be noted against the relevant guiding principle
• All critical incident that are not covered in the Functional Competencies and
Quantitative Measures will be taken into account under this category
• Emphasis to be given to the critical incidents in the following area:
o Housekeeping
o Personal Hygiene
o Waste Management
o Team Work
o General behavior exhibited at work
• The appraiser will assign a rating of Below, Above or Meets Expectation based on
the critical incidents
• The overall quantitative measures score (in percentage) will be determined by the
following formula:
Percentage Score: [(G1)/4] x 100 = [(__)/8]*100
C=%

Page 42 of 51
Where,
G1 = Score in “Following Our Guiding Principles”
4 = Maximum Score

• The overall functional rating will be determined using the following key:

Below 65% Below Expectation


65% – 85% Meets Expectation
Above 85% Exceeds
Expectation

4. Overall Rating
Once the overall functional, quantitative and guiding principles’ scores & ratings
have been assigned, the overall Performance Appraisal percentage score and rating
will be determined in the following manner:
• The overall quantitative measures score (in percentage) will be determined by the
following formula:
(A x 0.5) +(B x 0.25) + (C x 0.25)
D = %
Where,
A = Score in Functional Competency
B = Score in Quantitative Measures
C = Score in “Following Our Guiding Principles”

• The overall Performance Appraisal rating will be determined using the following
key:

Below 65% Below Expectation


65% – 85% Meets Expectation
Above 85% Exceeds
Expectation
• Gating Concept:
No employee will get an overall rating greater than or equal to “Meets
Expectation” unless the ratings in all three components are at least “Meets
Expectation”

Page 43 of 51
5. Improvement Statement
After arriving at the overall percentage secured by the employee and the rating assigned
to him as described above, the appraiser will discuss in detail the positive and negative
attributes with the appraisee and they will jointly list down the areas where there is
scope/need for improvement. The appraisee will list down all such areas of improvement
in this section.

Once the improvement statement has been written down, the Appraiser, Function Head
and the PMS Facilitator will enter their comments (if any) on the overall appraisal.

6. Signatures
This section will consist of the signatures of the appraisee, appraiser, function head and
the PMS Facilitator. The duly signed form will be submitted to the HR department for
further use.

Page 44 of 51
ANNEXURE 4
Ranking Meeting Guide

Page 45 of 51
RANKING MEETING GUIDE

PURPOSE
This document will provide step by step guide to hold a ranking meeting. It is essential to
follow the steps described here to attain the objective of ranking meeting.

RANKING MEETING
Ranking meeting is a meeting between all relevant S&C employees to:
1. Validate the rating of all technicians and team members arrived at by the
appraisers
2. Eliminate rater bias by analyzing ratings of all technicians and team members
together
3. Discuss and arrive at the final ranking list of technicians and team members.

The meeting will be held jointly for operations and support departments.

PRE-WORK FOR RANKING MEETING


The following pre-work need to be completed before ranking meeting is convened:
1. Departments should complete appraisals of all technicians and team members
working in the department.
2. The technicians and team members should be ranked in descending order of the
final percentage score attained by them in the appraisal.
3. Completed appraisal forms and the ranking data should be forwarded to HR
Department for consolidation.
4. HR Department should prepare the consolidated Ranking sheet for all the
technicians and team members with option to sort it by:
a. Department (Eg Production, Utilities etc)
b. Function (Eg Making, Micro Lab etc)
c. Group (Eg Technician, Team Member etc)
d. Rater/Appraiser

Page 46 of 51
e. Components of Performance Appraisal Form

PARTICIPANTS OF RANKING MEETING


Ranking Meeting
1. Manufacturing Manager
2. Production Manager
3. HR Manager
4. Technical Services Manager
5. Engineering Manager
6. Operations Team Leaders
7. PMS Facilitator

RANKING MEETING PROCESS


Step I
• All the participants of ranking meeting will be shown the ranking of technicians
and team members sorted by:
a. Department (Eg Production, Utilities etc)
b. Function (Eg Making, Micro Lab etc)
c. Group (Eg Technician, Team Member etc)
d. Rater/Appraiser
e. Components of Performance Appraisal Form
• No Discussion takes place during this step
• Participant will note down the names of technicians/ team members
o Who they think should be moved up or down the ranking
o About whom they feel need for clarification

Step II
• Participants will make a list of technicians/ team members with the suggested
change (up or down) in ranking

Page 47 of 51
• The convener will go round the room and collect one name from each participant.
Only one name is taken at a time to avoid repetition of names given by various
participants.

Step III
• Each name so collected will raised and the participant who gave the name will
explain the reason for his suggested change in ranking
• The appraiser of that technician/ team member will clarify reason for the rating
assigned
• All participants will discuss and arrive at a decision on the ranking of that
technician/ team member.
• In such a way all names collected in round 1 will be discussed

Step IV
• Once all names of round 1 are completed, steps II and III will be repeated till all
names noted down by all participants have been discussed and decided upon.

FINAL RANKING LIST


• Once both, operations and support, rating meeting are over, HR department will
consolidate all the results and publish a final ranking list of all the technicians and
team members.
• This list will not be shared with the technicians and team members.
• A list of technicians and team members in alphabetical order will be published
with 3 categories – namely: Exceeds Expectation, Meets Expectation & Below
Expectations. This list will be shared with all employees of Baddi Facility

Page 48 of 51
ANNEXURE 5
Skill Inventory

Page 49 of 51
Skill Inventory Below Expectation Meets Expectation Above Expectation
2 3 4
Demonstrates complete familiarity with all
Understand sequence and steps of core
Does not fully understand the changeover aspects changeover process, tools & line
aspects of Changeover process; Completes
Change-Overs process; Does not complete work in an
changeover timely, in right sequence, with
adjustments; Consistently contributes to
accurate and timely manner reducing changeover times without
the right tools
compromising safety and quality

Does not fully understand the C&S process; Understand sequence and steps of core
Demonstrates complete familiarity with all
Does not understand the C&S SOP and aspects of C&S process; Completes C&S
aspects C&S process; Understands and
Cleaning & Sanitization visual clean standards. Does not complete timelyand accurately. Understands and
trains others in C&S SOP and visual clean
work in an accurate and timely manner, follows C&S SOP and visual clean
standards. Needs virtually no supervision.
Needs constant supervision. standards. Needs minimal supervision

Does not appriciate the need for Takes initiatives to ensure that self and team
documentation and data collection; Lacks Completes required data collection & documentation is completed timely &
Documentation complete understanding of documentation documentation timely and accurately; accurately ; Adresses & Corrects all issues;
process; Has had issues with timely and Reports errors in documentation Identifies need for additional value adding
accurate completion of documentation documentation

Does not understand the manufacturing Takes initiative to be involved and build
Understands the manufacturing operation
Cross Functional process and how his work links to operations relationships with the operations teams;
and how his work links to operations
Knowledge performance; Has not made effort to become Leverages understanding of operations to
performance
involved outside own work area identify improvement oppurtunities

Core Work According to Function

Creates ways for speeding up PM’s;


Suggests new PM’s that need to be done;
Lacks in skills of PM, has had issues with Understands types and frequency of PM
Tracks uncomplete PMs and takes intiative to
Preventive Maintainance timely completion of PM work, needs work; Completes PM timely and accurately;
bring it to closure; Shows ability to work
continuous inputs/feedback Communicates status to team leader
towards predictive maintainance and
communicates to team leader

Does not respond quickly to breakdowns; No Responds quickly to breakdowns; Repairs


Overcomes recurring problems; Instills a
sense of urgency when doing repairs; done with a sense of urgency; Repairs done
Break Downs Repairs are generally inadequate or sub to an adequate standard; Raises major
sense of urgency in others; Is considered an
expert in their area
standard concern & issues in a timely manner

Page 50 of 51
Does not fully understand and appreciate the Understands the product quality standards;
Proactively identifies and takes steps to
quality standards, inspections and Completes all quality tests, inspections and
Quality documentation; Has had issues in meeting all documentation; Immediately addresses
rectify quality issues; Suggests and
implements ways to improve quality
quality expectations and/or raise the alarm about quality issues

Does not fully comply with PPE Identifies unsafe practices and condtions;
requirenments; Demonstrates unsafe work Follows all PPE requirenments; Provides feedback to otherts on safety
Safety practices; Does not implement safety Demonstrates safe work practices requirenments; Identifies improvement
feedback opportunities

Page 51 of 51