Report │ Technico Industries Limited
Jan 2015 Strictly Private & Confidential
Contents
Context and Background
Overall findings and action plan Detailed findings
5 March 2015
3
│ Confidential
Context Objective
Framework used: Inputs captured through
To assess the HR/IR capability of the supplier organizations and recommend an action plan for improvement
• • • •
Leadership Meeting Plant Visit FGD (Supervisor & Manager) and Document Review Leadership at Organization
TECHNICO - Site Visit The following team conducted the site visit on 24th Dec 2014 at Bawal Plant
Shop Floor
Organization & Manpower profile
People Management Processes
MSIL • Mr. Mussarat Husain, • Mr. Harish Bhardwaj
HSE & Welfare
Shop Floor Practices
Talentonic • Mr. Rajul Mathur • Mr. Agnivesh Singh
Industrial Climate
HR/IR Framework 5 March 2015
HR
4
│ Confidential
Statutory Compliances
How the framework is used Weightage of each factor S.No.
Factors:
Weightages (%age)
I
Leadership
20 %
II
Organization and Manpower profile
10 %
III
People Management Practices and Processes
20 %
IV
Health, Safety, Environment & Wellness
15 %
V
Statutory Compliance
10 %
VI
Shop Floor Practices
10 %
VII
Industrial Climate
15 %
Grand Total:
100 %
Classification of Suppliers Score Bracket Below 20 20-40 40-60 60-70 70-80 80 & Above
5 March 2015
Maturity Level Danger Zone Nascent Needs Improvement Evolving Evolved Excellence Zone
5
│ Confidential
Technico : Background Information High level Organization profile
Revenue (all units)
INR 280 Cr (MSIL is 38.5%) 9.15 %
Manpower cost as a % of sales
White collar
325
28%
Blue Collar
834
72%
Union in organization
Contract
Total count
79
755
%
10%
90%
< 25 Yrs.
8%
49%
25 - 35 Yrs.
61%
40%
35 - 45 Yrs.
26%
10%
> 45 Yrs.
5%
01%
< 1 Yr.
3%
48%
1 - 3 Yrs.
28%
33%
3 - 5 Yrs.
8%
15%
> 5 Yrs.
61%
4%
Tenure Analysis
NO
Recent Event: NA
5 March 2015
Permanent
Age Analysis
1159
Total no of employees
Blue Collar Profile
6
│ Confidential
Context and Background Overall findings and action plan Overall findings Action plan Detailed findings
5 March 2015
7
│ Confidential
Technico is in “Evolving Zone” on HR and IR capability
(1 of 4)
• Technico leadership has a good business vision. The growth plans are documented through the vision 2020 document. There is an understanding of benefits of professionalization and the organization is moving in that direction through Leadership development initiatives • The Shop floor leadership has respect but its translation on shop floor control is not evident. A 5 - 6 years old plant looks like a 10-15 years old
• Technico has good people management practices and employees are satisfied with the current systems and polices. Only concern is with respect to the performance appraisal system. It needs to be more objective and transparent • Most of the workmen in Technico are contractual (90%) and their average tenure is less then 1.5 years. Further, there is no entry level qualification filter for contractual workers and this can result in shop floor quality challenges • The Shop floor in terms of housekeeping and floor maintenance is not very impressive. The plant does not comes across as very safe from a shop floor space utilisation and flow perspective. Plating unit working environment needs improvement
• From a Security standpoint, “B”’ shift ends at 3:10 AM in night. Given that the transport facility is not available to contractual workmen, this can lead to a security issue
5 March 2015
8
│ Confidential
Technico is in “Evolving Zone” on HR and IR capability
(2 of 4)
• Quality initiatives are present but need to be leveraged better for benefits • The organization has No union and has a very cohesive and positive work environment. It also focuses on CSR initiatives and has garnered goodwill by developing toilets and drinking water facility in a Girls school in the vicinity • Technico has an overall score 69 % on HR and IR maturity and is in the “Evolving Zone”
Max Score
Score Attained
% score
Leadership
20
13.8
69%
PMPP
20
12.3
62%
HSE&W
15
8.0
54%
Stat Compliance
10
9.2
92%
Organization profile
10
4.6
46%
Shop Floor Practices
10
7.5
75%
Industrial Climate
15
13.8
92%
Overall Score
100
69.2
69%
5 March 2015
9
│ Confidential
Technico is in “Evolving Zone” Score 0-20 20-40 40-60 60-70 70-80 80 +
Code
Zone Danger Zone Nascent Needs Improvement Evolving Evolved Excellence Zone
A Summary snap shot of each area
(3 of 4) Leadership
A snapshot is provided herein of the elements in each of the framework areas to understand the areas of strength and weakness
Vision and business view
5 4
Quality of Supervision
3
Note: Rating on a scale of 1 to 5: Rating 1 means that the area needs significant attention. Rating 5 means that the area is working very well and can be a benchmark for others to follow
PMPP
69%
Involvement Awareness and Communication
2 1
Production (operation) leadership and mentoring
62%
0
Respect of Supervisors (Shop floor leadership)
Governance mechanism on IR/HR
HR Structure and HR Owner HR Leadership and Popularity
Recruitment People satisfaction survey / feedback process IR / P&A Service delivery
4 3
Induction
Organization Profile
42%
C&B (including OT for workmen)
White vs Blue collar
2 Grievance resolution process
1
5
Appraisal /Promotion / Increment
Gender ratio (workmen)
0 Disparity on work level
3
Age profile
2 Recognition/ incentives
1 0
Training for skill development
Disparity on Floor level
4
Local Vs outsiders
Education profile
Refresher and awareness Training
Absenteeism analysis Discipline Process
Direct vs Indirect
14/05/12
10
│ Confidential
Tenure ratio
A Summary snap shot of each area Compliance
(4 of 4)
92%
HSE & W
54%
PF
5
Lift / Fork Lift License
Security
ESI
4
Safety officer / Welfare office
5
Communication with workmen
4
Gratuity
3
Committees and governance
2
Boiler/ Pressure vessel test certificate
Machine Safety
3 2
Child Labor
1
Transport (bus)
Accidents – reported / unreported – and process followed
1
0 HSD Storage license
Fire safety and evacuation
0
Standing orders
Canteen / Crèche Consent under air and water pollution
Minimum wage
Contractor license
Pollution test certificate -water, noise, air Natural environment (Air, Water, Access)
Non discrimination Prevention from harassment and abuse
Factory license
Shop Floor Practices
75%
Working hours
Facilities, washing, toilet PPE use and awareness
Medical, First aid
Industrial Climate
92% CSR
Production flexibility , control and leverage
Communication process with Unions
Transparency of operational targets and their achievement
Union numbers and type
Japanese Practices - Kaizen, 5S, QC , CFT, etc.
1 1 14/05/12
2
3
4
5
6 Confidential
2
3
4
5
6
Context and Background Overall findings and action plan Overall findings Action plan Detailed findings
5 March 2015
12
│ Confidential
Our action plan should focus on leveraging opportunities, overcoming the weakness and isolating the threats Strength
Weakness
1. A wide and clear view of top leadership on people and business – Participative Growth for both. 2. No union environment 3. Old and loyal capable permanent employees 4. Company has good infrastructure with inhouse tool making and R&D lab 5. Properly maintained Compliance 6. CSR activity
1. Overall supervision at floor level is poor 2. Health and safety arrangements are not properly maintained 3. Education profile of workers is a concern as no entry level minimum qualification for casual 4. Performance appraisal system needs not perceived as and uniform 5. Efficiency of improvement initiatives (Kaizen, 5S)
Opportunity
Threat
1. Motivated employees can bring in significant shop floor improvements 2. Education profile of casual employees can be improved without much efforts
1. High dependency on contractual workforce – 90% shop floor dependency 2. The second shift (B) shift timings 6 :45 to 3:10 AM. Can lead to security issue and can create disruption in work
5 March 2015
13
│ Confidential
Therefore, the recommended action plan for discussion with Supplier
Action
Improvement Area
1
Setting standards on HSE by the Leadership team and communicating the same to the Shop Floor. Once done, ensuring compliance with the same at Shop Floor.
HSE
2
Training of Shop Floor leadership team on Manufacturing excellence. This should be about explaining their role on ensuring compliance to standards set and a clarification on the shop floor excellence role expected from them. Evaluation of this needs to be done regularly
3
The Performance management system needs to be relooked. It needs to be made more objective and the implementation of the safe in the right way needs to be ensured. Performance conversation with the appraise needs to be ensured.
4
Revisit the Shift schedules or ensure proper transportation facility for the night shift employees
HSE (Security)
5
Given the high ratio of contract workmen, organization should introduce a more robust induction program for workmen. Also minimum education standards need to be defined
Recruitment
5 March 2015
14
Timeframe
MSIL role
• With 1 month
Knowledg e Sharing
Shop Floor Leadership
• Net 3 months
Knowledg e sharing & facilitation
People Practices & Satisfaction
• 3-6 months
Facilitation
│ Confidential
• With 1 month
NA
• 0-6 months
NA
Agreed by Supplier
Additional action items, if any, to be filled by the Supplier Improveme nt Area
Action
1
2
3
4
5
14/05/12
Confidential
Timeframe
MSIL role
Context and Background
Overall findings and action plan Detailed findings
5 March 2015
16
│ Confidential
Observations
1. Leadership has good and strong vision • Leadership understand the respect of its employees and the value of regular communication. • Governance and involvement is high, good respect and relationship between employees and management.
Area
Detailed Observations
Score
1
Vision and business view
Business vision of MD is clear and he is working on business plan 2020, business plan is communicated and leadership development program is going on. Clearly understood by all
5
2
Involvement Awareness and Communication
Involvement of Senior leadership and top management is OK. Communication with employees has good value for top management, The communication directly is not very frequent but awareness and feel of floor is strong at the top
4
3
Governance mechanism on IR/HR
Good governance as internal policies and procedures are good, regular review for policies, for external environment informal vigilance is there.
4
Note: Rating on a scale of 1 to 5: Rating 1 means that the area needs significant attention. Rating 5 means that the area is working very well and can be a benchmark for others to follow Contd. 5 March 2015
17
│ Confidential
1. (contd.)
Area
Detailed Observations
4
HR Structure and HR Owner
Direct involvement of top management. Policies and procedure are in place and are properly communicated.
4
5
HR Leadership and popularity
A meaningful HR/IR ownership
4
6
Respect of Supervisors (Shop floor leadership)
Supervisors get full respect at floor, most of the workers are casual and cooperative
3
7
Production (operation) Production leadership is good as old loyal employees are there with long and Leadership and Mentoring valuable experience
8
Quality of Supervision
Is weak, as floor was not maintained properly, people are not using PPE at places, oil spillage etc.. Shop floor leadership is not focusing on these
Score
3
2
Note: Rating on a scale of 1 to 5: Rating 1 means that the area needs significant attention. Rating 5 means that the area is working very well and can be a benchmark for others to follow
5 March 2015
18
│ Confidential
Observations
2. Technico is heavily reliant on contractual workforce • The organization has 90% casual / contractual workers with a relatively low experience (approx. 1 year) • There is a low minimum education entry barrier on contractual manpower. The contractual manpower is young and can be trained though.
Area
Detailed Observations
Score
1
White collar vs. Blue collar
it is 1:2.5 employees (325 vs 835)
3
2
Age profile
in case of permanent 33 years and in case of casual 24 years approx..
4
3
Education profile
Poor, as no entry level minimum technical qualification is required in case of permanent and casual labor
2
4
Tenure ratio
Tenure for permanent is 5+ yrs. but in case of casual it is 1.5 yrs. only
4
5
Direct vs. Indirect
1:10 (permanent vs contractual) almost all casual / contractual workers
2
6
Local Vs outsiders
A good mix is there all most 1:1
4
7
Gender ratio (workmen)
No woman workers
1
Note: Rating on a scale of 1 to 5: Rating 1 means that the area needs significant attention. Rating 5 means that the area is working very well and can be a benchmark for others to follow
5 March 2015
19
│ Confidential
Observations
3. People Management Practices are good at Technico • Employees in the organization are committed and motivated • The current HR / IR policies and practices are good, implemented well, meaningful and has created a positive impact • The performance appraisal system needs to be made uniform and more transparent. This is particularly true for workers
Area
Detailed Observations
Score
1
Recruitment
Recruitment practice is good. No reference check is there for all.
4
2
Induction
Induction training for all workmen (permanent and contractual) - at least for one day
3
3
Minimum wage in case of casual, higher in case of permanent - Average salary as per C&B (including OT industry, salary slips for all. Statutory benefits complied with. OT is paid to employees but for workmen) not as per law
4
4
Appraisal / Promotion / Increment
2
OK and regular, but appraisal system is more in the hand of owner and there is no feedback system for grievance on performance appraisal for employees
Note: Rating on a scale of 1 to 5: Rating 1 means that the area needs significant attention. Rating 5 means that the area is working very well and can be a benchmark for others to follow
Contd.
5 March 2015
20
│ Confidential
3. (contd.) Criteria
Observations
5
Recognition/ incentives
There are a number of monetary and non-monetary incentive practices in place, various scheme for suggestion, Attendance Incentive etc.
4
6
Training for skill development
Yes, in house training is provided, in house induction training room "PATHSHALA“, no soft skill training for workers
3
7
Refresher and awareness Training
Yes on various areas as fire -fighting, first aid, PPE etc.
4
8
Discipline Process
Discipline process is followed properly and most of the cases are settled amicably.
4
9
Absenteeism analysis
Absenteeism is around 7% . There is an attendance incentive.
3
10 Disparity on Floor level
No disparity as most of the workers are casual employees only
3
11 Disparity on Work level
Not evident, as most of the casual workers only
3
12 Grievance resolution process
13
IR / P&A Service delivery
14
People satisfaction survey / feedback process
15
Celebrations
Rating
There is a Grievance Re-dressal Committee with regular meetings and action plan. There are other interaction forums for employees to raise their concerns. No separate IR owner, HR department handle all matters, IR service delivery is OK No formal process in place. There are forums to gauge satisfaction / obtain feedback. Collation / analysis is snot carried out on a consolidated basis. Yes , Jagrata, annual day, sports and master blaster Note: Rating on a scale of 1 to 5: Rating 1 means that the area needs significant attention. Rating 5 means that the area is working very well and can be a benchmark for others to follow
5 March 2015
21
│ Confidential
4
4 3 4
Observations
4. Health and Safety arrangements need improvement • Health and Safety arrangements are not proper, there is poor ventilation in plating unit. Use of PPE is limited and not enforced. There is oil spillage at floor. • The workmen have Security and safety concerns due to “B” shift timings as it ends at 3:10 AM (Night) • Company has a beautiful garden area. Horticulture is good. 2600 trees have been planted in last two years. Also the ETP / STP works with zero discharge concept
Area
Detailed Observations
Score
Security
Good security arrangements ; CCTVs in place, “B” shift ends at 3:10 AM (night) is a cause of security concern for employees
2
2
Fire safety and evacuation
Facility has fire extinguishers and other fire safety arrangement but same is not properly maintained, poorly visibility of Exit Plans at floor, loose electricity wiring, no emergency lights at exit gates
2
3
Machine Safety
Operating instructions are there, lot of oil spillage at shop floor, no rubber mat at electrical panel at first floor, loose wires near exit B
2
4
Accidents – reported / unreported – and process followed
Accidents are minor in nature, were reported and corrective action was taken
3
5
Working hours
Shifts are for 9 hrs.. but if required can be stretched up to 12 hrs., proper breaks are provided for lunch and tea
3
1
Note: Rating on a scale of 1 to 5: Rating 1 means that the area needs significant attention. Rating 5 means that the area is working very well and can be a benchmark for others to follow
Contd.
5 March 2015
22
│ Confidential
4. (contd.) Criteria
Observations
Rating
6
Facilities, washing, toilet
Drinking water and toilet facility is provided at shop floor but hygiene level needs improvement
7
PPE use and awareness
8
Medical, First aid
9
Natural environment (Air, Water, Access)
Poorly ventilation at plating unit, other areas are ok
3
10
Pollution test certificate -water, noise, air
All certificates were evident , good horticulture, have planted 2600 trees in last two years
5
11 Canteen / Crèche
Canteen is run by a contractor. It is clean but needs to be expanded. Food was wholesome and is subsidised to ~ 60%.
5
12 Transport facility
Free transport provided on specified routes for permanent employees
3
13 Committees and governance
Safety, suggestion, prevention of sexual harassment and grievance committees are evident and minutes shows active participation by members, but no works committee
4
14 Communication with workmen
Through monthly gathering by plant head and quarterly email from MD
4
Only few individuals were wearing safety shoos, no proper knowledge of use of PPE Medical room is there, Employees are covered under ESI / Medical Insurance. First Aid training imparted to specific employees by Red Cross
3
2 3
Note: Rating on a scale of 1 to 5: Rating 1 means that the area needs significant attention. Rating 5 means that the area is working very well and can be a benchmark for others to follow
5 March 2015
23
│ Confidential
5. Technico is mostly compliant on Statutory Items Area
Detailed observations
Rating
1
PF
In order
5
2
ESI
In order
5
3
Gratuity
In order
5
4
Child Labor
Not seen
5
5
Standing orders
In order
5
6
Minimum wage
Complied with
5
7
Non discrimination
In order
5
8
Prevention from harassment and abuse
No evidence to the contrary
4
9
Factory license
Committee formed with regular meetings
5
10
Contractor license
In Order
4
11
Consent under air and water pollution
Contractors with more than 20 employees have a license ; others are on Technico’s Register of Contractors
5
12
HSD Storage license
Available
5
13
Boiler / PV test certificate Available
5
14 15
Safety officer / Welfare office Lift / Fork Lift license
5 March 2015
For Pressure vessels yes, boiler N/A
3
Yes for welfare no safety officer
4
Note: Rating on a scale of 1 to 5: Rating 1 means that the area needs significant attention. Rating 5 means that the area is working very well and can be a benchmark for others to follow 24 │ Confidential
Observations
6. Shop floor practices with low impact on work culture
• There is strong evidence of improvement initiatives being launched in the organization • However, the impact of the same at shop floor is missing. Activity has low impact and the work culture, currently, does not support it.
Area
Detailed Observations
Score
1
Kaizen and 5 S activities , CFT
5S, Kaizen, quality circle etc.. implementation is evident but Impact of the same is very little on Shop floor
3
2
Transparency of operational targets and their achievement
Targets are shared in the shift meeting. Target and actuals shared with workmen
4
3
Production flexibility is available, No evidence of negotiating production Production flexibility , control and targets leverage
5
Note: Rating on a scale of 1 to 5: Rating 1 means that the area needs significant attention. Rating 5 means that the area is working very well and can be a benchmark for others to follow
5 March 2015
25
│ Confidential
Observations
7. Technico is enjoying a positive Industrial climate
• The Social Environment is well managed. There is no Union.
• Employees are satisfied and have a feeling of belongingness • Organization is actively involved in various CSR activities
Area
Detailed Observations
Score
1
Union no and type
No Union
5
2
Communication process with Unions
NA, however, employees are satisfied as regular communication is maintained by management
5
3
CSR
Yes an active CSR policy, did toilet and drinking water facility for Girls College in current financial year also mid day meals for school
4
Note: Rating on a scale of 1 to 5: Rating 1 means that the area needs significant attention. Rating 5 means that the area is working very well and can be a benchmark for others to follow 5 March 2015
26
│ Confidential
Strictly private and confidential. Not for further distribution without express written permission of Talentonic. For any queries, please connect with
[email protected] and
[email protected]
5 March 2015
27
│ Confidential
