Emerging Hr

practices : Aditya
Birla Group
By: Mentored By:
Abhishek Ranjan
Ankit Dubey Dr. Urvashi Sharma
Chhavi Duggal
Kanchan Kumari
Siddharth Gusain
Case Background
The longitudinal case study provides
a snapshot of the dynamic and
turbulent nature of the new
liberalized Indian economic
environment and how an
organization such as Aditya Birla
Group needed to brace itself from
competition through innovative HR
practices.
This article analyzes a longitudinal
case of organizational redesign and
the emerging role of HRM during this
redesign of Aditya Birla Group, the
third largest diversified business
group in India, that grew from US$1.5
billion in 1995 to US$7.59 billion in
2006
 Problem statement
◇ Having taken over the business KM Birla decided to consolidate entire group’s
companies under one umbrella of “Aditya Birla Group”
◇ KM Birla was criticized as a soft and shy person who lacked assertiveness and
expertise.
◇ An unapproachable management and his misplaced priorities resulted into
investors started selling off their shares.In 1996 the market value of group’s four
largest company Grasim,Rayon,Hindalco and gulf fertilizer suddenly decreased
by 37%
◇ So KM Birla took several initiatives to prove his critics wrong
Innovation
in Hr
Practices
Rising Sun!
Creating Identity
◇The symbol of the Rising Sun brought different
parts of the Group together, helped them as an
organization to reenergize ourselves, cross the
bridge, and to get started on the path of change.

◇The Rising Sun in a strange way brought a new

optimism and served as a rallying point for the
organization
360 degree performance appraisal
◇To do away with the babu culture so

prevalent at Birla companies, Mr. Birla

launched a 360- degree performance
appraisal program that allowed Place your screenshot here

managers to question even his leadership

style

◇After the feedback, he issued each

senior manager a six page letter

mentioning the areas of improvement
and his expectations.
Retirement Policy
He introduced a retirement
policy , on the basis of which
around 325 senior were there
early 60s,had quit the
organization in the next five
years .subsequently about
400 young employees
replaced them..
Meanwhile ,answering the
critics he said, "people in the
group about twice my age
when I took over as chairman.
I had great respect for them
personally, but I also feel the
need for change”
Scholarships to
students and
Employees
In 1999 K.M.Birla He said, "cultivating a He also launched
launched the Aditya new generation of Aditya Birla awards in
Birla scholarship to managers and 1999 where team
promote excellence cultivating a achievements
among students participative culture are recognized every year .
community to cultivate keys to the increasingly
the leaders of energetic, people
tomorrow. centered, and
performance focused
culture we aspire for”..
Happiness at Work
•Birla had also implemented the organizational health survey,
which measured the “Happiness at work” index. This was carried
out to track the employees satisfaction.
•The Aditya Birla Group figures high in the Hewitt Associates
ranking of the “Best Employers in India.
•Thai Carbon Black and Indo Thai Synthetics, our overseas
company, rated as best employers in Thailand in 2003 by Hewitt.
•Attrition rate of 1 percent for 2004–2005 is one of the lowest in
the country.
 Change in reporting
structure
◇ He also brought about changes in reporting system being followed at the group. The
top 20 executives of the group, who had greater responsibilities in the group, could
report directly to K.M.Birla, thereby giving them complete freedom to run their
businesses and same holding the more accountable for their performance.

◇ K.M.Birla also brought in some managerial changes in the group. Before K.M.Birla
took the chairmanship, the hierarchy in the group was determined by seniority
instead of merit. He instituted a performance appraisal system. He decided to
implement performance management systems, reviewed compensations and
accentuated on training to bring meritocracy.
Humanistic
Attitude
 250 people
work to raise literacy levels, take health care to the hut-step of the villagers, and train them
to eke out a sustainable livelihood, empower women, provide basic amenities, and espouse
social reform

Habitat for Humanity

an international NGO working in the areas of housing for the marginalized section of society

500 widows
have been remarried. The third community work is promoting widow remarriages and
dowryless marriages
Conclusion
◇ This case study ◇ Within a
explained how an hypercompetitive and
emerging Indian MNC turbulent environment,
redesigned itself within HR itself demanded that
a span of 10 years the organization
through its HR function develop new capabilities
to keep up with the aligned to the
accelerating pace of organization’s business
change in the external strategy
and internal
environments.
ThankYou