1.

Introduction of The Insurance Industry

Overview
The story of insurance is probably as old as the story of mankind. The same
instinct that prompts modern businessmen today to secure themselves against loss
and disaster existed in primitive men also. They too sought to avert the evil
consequences of fire and flood and loss of life and were willing to make some sort
of sacrifice in order to achieve security. Though the concept of insurance is largely
a development of the recent past, particularly after the industrial era – past few
centuries – yet its beginnings date back almost 6000 years.
The first two decades of the twentieth century saw lot of growth in insurance
business. From 44 companies with total business-in-force as Rs.22.44 crore, it rose
to 176 companies with total business-in-force as Rs.298 crore in 1938. The
Insurance Act 1938 was the first legislation governing not only life insurance but
also non-life insurance to provide strict state control over insurance business.
Some of the important milestones in the life insurance business in India are:
1818: Oriental Life Insurance Company, the first life insurance company on Indian
soil started functioning.
1870: Bombay Mutual Life Assurance Society, the first Indian life insurance
company started its business.
1912: The Indian Life Assurance Companies Act enacted as the first statute to
regulate the life insurance business.
1928: The Indian Insurance Companies Act enacted to enable the government to
collect statistical information about both life and non-life insurance businesses.
1938: Earlier legislation consolidated and amended to by the Insurance Act with
the objective of protecting the interests of the insuring public.
1956: 245 Indian and foreign insurers and provident societies are taken over by the
central government and nationalized. LIC formed by an Act of Parliament, viz.
LIC Act, 1956, with a capital contribution of Rs. 5 crore from the Government of
India.
The General insurance business in India, on the other hand, can trace its roots to
the Triton Insurance Company Ltd., the first general insurance company
established in the year 1850 in Calcutta by the British.
Some of the important milestones in the general insurance business in India are:
1907: The Indian Mercantile Insurance Ltd. set up, the first company to transact all
classes of general insurance business.

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1957: General Insurance Council, a wing of the Insurance Association of India,
frames a code of conduct for ensuring fair conduct and sound business practices.
1968: The Insurance Act amended to regulate investments and set minimum
solvency margins and the Tariff Advisory Committee set up.
1972: The General Insurance Business (Nationalisation) Act, 1972 nationalised the
general insurance business in India with effect from 1st January 1973.
With largest number of life insurance policies in force in the world, Insurance
happens to be a mega opportunity in India. It’s a business growing at the rate of
15-20 per cent annually and presently is of the order of Rs 450 billion. Together
with banking services, it adds about 7 per cent to the country’s GDP. Gross
premium collection is nearly 2 per cent of GDP and funds available with LIC for
investments are 8 per cent of GDP.
Yet, nearly 80 per cent of Indian population is without life insurance cover while
health insurance and non-life insurance continues to be below international
standards. And this part of the population is also subject to weak social security
and pension systems with hardly any old age income security. This itself is an
indicator that growth potential for the insurance sector is immense.
A well-developed and evolved insurance sector is needed for economic
development as it provides long term funds for infrastructure development and at
the same time strengthens the risk taking ability. It is estimated that over the next
ten years India would require investments of the order of one trillion US dollar.
The Insurance sector, to some extent, can enable investments in infrastructure
development to sustain economic growth of the country.
India has come a full circle from being an open competitive market to
nationalization and back to a liberalized market again. Tracing the developments in
the Indian insurance sector reveals the 360 degree turn witnessed over a period of
almost two centuries.
Present Scenario
The Government of India liberalized the insurance sector in March 2000 with the
passage of the Insurance Regulatory and Development Authority (IRDA) Bill,
lifting all entry restrictions for private players and allowing foreign players to enter
the market with some limits on direct foreign ownership.
The opening up of the sector is likely to lead to greater spread and deepening of
insurance in India and this may also include restructuring and revitalizing of the
public sector companies. In the private sector 14 life insurance and 8 general
insurance companies have been registered. A host of private Insurance companies
operating in both life and non-life segments have started selling their insurance
policies..

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Life Insurance Market
The Life Insurance market in India is an underdeveloped market that was only
tapped by the state owned LIC till the entry of private insurers. The penetration of
life insurance products was 19 percent of the total 400 million of the insurable
population. The state owned LIC sold insurance as a tax instrument, not as a
product giving protection. Most customers were under- insured with no flexibility
or transparency in the products. With the entry of the private insurers the rules of
the game have changed.
The 12 private insurers in the life insurance market have already grabbed nearly 9
percent of the market in terms of premium income. The new business premiums of
the 12 private players has tripled to Rs 1000 crore in 2002- 03 over last year.
Innovative products, smart marketing and aggressive distribution. That's the triple
whammy combination that has enabled fledgling private insurance companies to
sign up Indian customers faster than anyone ever expected. Indians, who have
always seen life insurance as a tax saving device, are now suddenly turning to the
private sector and snapping up the new innovative products on offer.
The private insurers also seem to be scoring big in other ways- they are persuading
people to take out bigger policies. Buoyed by their quicker than expected success,
nearly all private insurers are fast- forwarding the second phase of their expansion
plans.

Major Insurance Players

Licenses have been issued for the following companies
 ICICI Prudential Life Insurance Limited
 ICICI Prudential Life Insurance Company Limited
 HDFC Standard Life Insurance Company Limited
 Birla Sun Life Insurance Company Limited
 TATA AIG Life Insurance Company Limited
 Max New York Life Insurance Company Limited
 SBI – Cardiff Life Insurance Company Limited
 ING Vysya Life Insurance Company Limited
 Bajaj Allianz Life Insurance Company Limited
 MetLife Life Insurance Company Limited
 Aviva Life Insurance Company Limited

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  AMP Sanmar Life Insurance Company Limited
 Sahara India Life Insurance Limited
 Sri Ram Life Insurance Limited

Protection of the interests of policyholders:

IRDA has the responsibility of protecting the interest of insurance policyholders.
Towards achieving this objective, the Authority has taken the following steps:
1. IRDA has notified Protection of Policyholders Interest Regulations 2001 to
provide for: policy proposal documents in easily understandable language;
claims procedure in both life and non-life; setting up of grievance redressal
machinery; speedy settlement of claims; and policyholders' servicing. The
Regulation also provides for payment of interest by insurers for the delay in
settlement of claim.
2. The insurers are required to maintain solvency margins so that they are in a
position to meet their obligations towards policyholders with regard to
payment of claims.
3. It is obligatory on the part of the insurance companies to disclose clearly the
benefits, terms and conditions under the policy. The advertisements issued
by the insurers should not mislead the insuring public.
4. All insurers are required to set up proper grievance redress machinery in
their head office and at their other offices.

The Authority takes up with the insurers any complaint received from the
policyholders in connection with services provided by them under the
insurance contract

COMPANY PROFILE
ICICI Prudential Life Insurance
ICICI Prudential Life Insurance Company is a joint venture between ICICI Bank, a
premier financial powerhouse and Prudential plc, a leading international financial
services group headquartered in the United Kingdom.
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ICICI was established in 1955 to lend money for industrial development. Today, it
has diversified into retail banking and is the largest private bank in the country.
Prudential plc was established in 1848 and is presently the largest life insurance
company in UK.
ICICI Prudential is currently the No. 1 private life insurer in the country. For the
financial year ended March 31, 2005, the company garnered Rs 1584 crore of new
business premium for a total sum assured of Rs 13,780 crore and wrote nearly
615,000 policies.
The Company recognizes that the driving force for gaining sustainable competitive
advantage in this business is superior customer experience and investment behind
the brand. The Company aims to achieve this by striving to provide world class
service levels through constant innovation in products, distribution channels and
technology based delivery. The Company has already taken significant steps to
achieve this goal.
India's Number One private life insurer, ICICI Prudential Life Insurance Company
is a joint venture between ICICI Bank-one of India's foremost financial services
companies-and Prudential plc- a leading international financial services group
headquartered in the United Kingdom. Total capital infusion stands at Rs. 23.72
billion, with ICICI Bank holding a stake of 74% and Prudential plc holding 26%.

ICICI Prudential was the first life insurer in India to receive a National Insurer
Financial Strength rating of AAA (Ind) from Fitch ratings. For three years in a
row, ICICI Prudential has been voted as India's Most Trusted Private Life Insurer,
by The Economic Times - AC Nielsen ORG Marg survey of 'Most Trusted
Brands'. As we grow our distribution, product range and customer base, we
continue to tirelessly uphold our commitment to deliver world-class financial
solutions to customers all over India.
FACT SHEET
THE COMPANY

ICICI Prudential Life Insurance Company is a joint venture between ICICI Bank, a
premier financial powerhouse, and Prudential plc, a leading international financial
services group headquartered in the United Kingdom. ICICI Prudential was
amongst the first private sector insurance companies to begin operations in
December 2000 after receiving approval from Insurance Regulatory Development
Authority (IRDA).

ICICI Prudential's capital stands at Rs. 23.72 billion with ICICI Bank and
Prudential plc holding 74% and 26% stake respectively. For the first quarter ended
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June 30, 2007, the company garnered Rs. 987 crore of weighted retail + group new
business premiums and wrote over 450,000 retail policies in the period. The
company has assets held to the tune of over Rs. 18,400 crore.

ICICI Prudential is also the only private life insurer in India to receive a National
Insurer Financial Strength rating of AAA (Ind) from Fitch ratings. The AAA (Ind)
rating is the highest rating, and is a clear assurance of ICICI Prudential's ability to
meet its obligations to customers at the time of maturity or claims.

For the past six years, ICICI Prudential has retained its position as the No. 1
private life insurer in the country, with a wide range of flexible products that meet
the needs of the Indian customer at every step in life.

Distribution

ICICI Prudential has one of the largest distribution networks amongst private life
insurers in India. It has a strong presence across India with over 680 branches and
over 235,000 advisors.

The company has over 23 bancassurnace partners, having tie-ups with ICICI Bank,
Federal Bank, South Indian Bank, Bank of India, Lord Krishna Bank, Idukki
District Co-operative Bank, Jalgaon Peoples Co-operative Bank, Shamrao Vithal
Co-op Bank, Ernakulam Bank, 9 Bank of India sponsored Regional Rural Banks
(RRBs), Sangli Urban Co-operative Bank, Baramati Co-operative Bank, Ballia
Kshetriya Gramin Bank, The Haryana State Co-operative Bank and Imphal Urban
Cooperative Bank Limited
DISTRIBUTION
ICICI Prudential has one of the largest distribution networks amongst private life
insurers in India, having commenced operations in 150 cities and towns in India,
stretching from Bhuj in the west to Guwahati in the east, and Jammu in the north to
Trivandrum in the south.
The company has 9 bank partnerships for distribution, having agreements with
ICICI Bank, Bank of India, Federal Bank, South Indian Bank, Lord Krishna Bank,
and some co-operative banks, as well as over 300 corporate agents and brokers. It
has also tied up with NGOs, MFIs and corporates for the distribution of rural
policies.
ICICI Prudential has recruited and trained more than 1, 90,000 insurance advisors
to interface with and advise customers. Further, it leverages its state-of-the-art IT
infrastructure to provide superior quality of service to customers
RegisteredOffice :

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ICICI Towers 9thfloor, Bandra-Kurla Complex
Mumbai - 400 051.
Tel: 494 3232

Regional Office :
8th floor EROS Coorporate Tower,Nehru place,
New Delhi-110011.Tel:46554405
Delhi office :
3rd floor
Videocon Towers
E-1, Rani Jhansi Road
New Delhi - 110055. Tel: 601 3232

Products Insurance Solutions For Individuals

ICICI Prudential Life Insurance offers a range of innovative, customer-centric
products that meet the needs of customers at every life stage. Its products can be
enhanced with up to 4 riders, to create a customized solution for each policy
holder.
Savings Solutions
• Save’n’Protect is a traditional endowment savings plan that offers life
protection along with adequate returns.
• CashBak is an anticipated endowment policy ideal for meeting milestone
expenses like a child’s marriage, expenses for a child’s higher education or
purchase of an asset.
• LifeTimeSuper offer customers the flexibility and control to customize the
policy to meet the changing needs at different life stages. Each offer 4 fund
options — Preserver, Protector, Balancer and Maximiser.

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 • LifeLink Super is a single premium Unit Linked Insurance Plan which
combines life insurance cover with the opportunity to stay invested in the
stock market.
• Premier Life Gold is a limited premium paying plan that offers customers
life insurance cover till the age of 75.
• InvestShield Life New is a unit linked plan that provides premium guarantee
on the invested premiums and ensures that the customer receives only the
benefits of fund appreciation without any of the risks of depreciation.
· InvestShield Cashbak is a unit linked plan that provides premium
guarantee on the invested premiums along with flexible liquidity options.
Protection Solutions
• LifeGuard is a protection plan, which offers life cover at very low cost. It is
available in 3 options – level term assurance, level term assurance with
return of premium and single premium.
• HomeAssure is a mortgage reducing term assurance plan designed
specifically to help customers cover their home loans in a simple and cost-
effective manner.
Child Plans
· SmartKid education plans provide guaranteed educational benefits to a
child along with life insurance cover for the parent who purchases the
policy. The policy is designed to provide money at important milestones in
the child’s life. SmartKid plans are also available in unit-linked form – both
single premium and regular premium.
Education Insurance Plans
· Education insurance under the SmartKid brand provides
guaranteed educational benefits to a child along with life insurance
cover for the parent who purchases the policy. The policy is designed to
provide money at important milestones in the child's life. SmartKid
plans are also available in unit-linked form - both single premium and
regular premium
Retirement Solutions
• ForeverLife is a retirement product targeted at individuals in their thirties.
• Market-linked retirement products
• LifeTime Super Pension is a regular premium market-linked pension plan.

8
 • Golden Years: is a limited premium paying retirement solution that offers
tax benefits up to Rs 100,000 u/s 80C, with flexibility in both the
accumulation and payout stages.
Health Solution
• Health Assure and Health Assure Plus: Health Assure is a regular premium
plan which provides long term cover against 6 critical illnesses by providing
policyholder with financial assistance, irrespective of the actual medical
expenses. Health Assure Plus offers the added advantage of an equivalent
life insurance cover
• Cancer Care: is a regular premium plan that pays cash benefit on the
diagnosis as well as at different stages in the treatment of various cancer
conditions.
• Diabetes Care and Diabetes Care Plus*: 1st ever critical illness insurance
cover for diabetics.
• Hospital Care*: Hospital Care offers a Cashless hospitalization facility in
more then 3000 network hospitals
• Crisis Cover : is a 360-degree product that will provide long-term coverage
against 35 critical illnesses, total and permanent disability, and death
Note (*) products Re-launched on 1st July 2006
Group Insurance Solutions
ICICI Prudential also offers Group Insurance Solutions for companies seeking
to enhance benefits to their employees.
ICICI Pru Group Gratuity Plan: ICICI Pru’s group gratuity plan helps employers
fund their statutory gratuity obligation in a scientific manner. The plan can also be
customized to structure schemes that can provide benefits beyond the statutory
obligations.

ICICI Pru Group Superannuation Plan: ICICI Pru offers a flexible defined
contribution superannuation scheme to provide a retirement kitty for each member
of the group. Employees have the option of choosing from various annuity options
or opting for a partial commutation of the annuity at the time of retirement.

ICICI Pru Group Term Plan: ICICI Pru’s flexible group term solution helps
provide affordable cover to members of a group. The cover could be uniform or

9
 based on designation/rank or a multiple of salary. The benefit under the policy is
paid to the beneficiary nominated by the member on his/her death.

Choice of Six Investment Options :-

ICICI prudential offers you the opportunity of selecting between investment
options to match your investment priorities.
1) Protector:- An Investment Option with investment indebt and money market
instruments.
2) Maximiser :- An investment option with investment in equity and equity
related instruments.
3) Balancer: - An investment option with investment in a mix of equity and debt
oriented instruments.
4) Preserver: - An investment option with investment in low-risk instruments like
cash and call money markets.
5) Flexi Growth: - New Fund (NFO) launched in March 2007, Long term returns
from an equity portfolio lare, mid and small cap companies.
6) Flexi balanced:- Balance of capital appreciation and stable returns from an
equity (large, mid & small cap companies) & debt portfolio.

10
Businesses at Various Growth Phase

11
Asset
Car
Commercial
Sunrise
Stable/gr
Leader
Finance
Knowl
Wealt
Asset
Reconstructi
owth
Finan
edge
h
Vehicles,
on
Mgmt
Skills
ce
Retail Loans
Corp Finance
Investment
Banking

Distribution
and
Pvt. Equity
Mutual Fund
Brokerage
Life
International
Insurance
Operations

Global footprint-
ASSETS UNDER MANAGEMENT

12
 SA- 18%

US- 57%
OTHERS- 3%

EUROPE- 22%

The journey so far

In October 2005, ICICI Group acquired the 40% stake in ICICI Prime held by
Ford Credit International (FCI) and FCI acquired the stake in Ford Credit
ICICI PRUDENTIAL (FCKM) held by ICICI Group.

13
In May 2006, ICICI Group bought 25% stake held by Goldman Sachs in ICICI
Capital and ICICI Securities.

Key group companies and their businesses

ICICI PRUDENTIAL Bank The ICICI PRUDENTIAL Group's flagship

company, ICICI PRUDENTIAL Finance Ltd which was established in 1985, was
converted into a bank- ICICI PRUDENTIAL Bank Ltd in March 2003 becoming
the first Indian company to convert into a Bank. Its banking operations offer a
central platform for customer relationships across the group's various businesses.
The bank has presence in Commercial Vehicles, Retail Finance, Corporate
Banking, Treasury and Housing Finance.

ICICI PRUDENTIAL Capital Company ICICI PRUDENTIAL Capital

Company Limited (KMCC) is India's premier Investment Bank. KMCC's core
business areas include Equity Issuances, Mergers & Acquisitions, Structured
Finance and Advisory Services.

ICICI Securities ICICI Securities Ltd. is one of India's largest brokerage and
securities distribution houses. Over the years, ICICI Securities has been one of the
leading investment broking houses catering to the needs of both institutional and
non-institutional investor categories with presence all over the country through
franchisees and coordinators. ICICI Securities Ltd. offers online (through
www.ICICIsecurities.com) and offline services based on well-researched expertise
and financial products to non-institutional investors.

ICICI PRUDENTIAL Prime ICICI PRUDENTIAL Prime Limited (KMP)

(formerly known as ICICI PRUDENTIAL Primus Limited) has been formed with
the objective of financing the retail and wholesale trade of passenger and multi
utility vehicles in India. KMP offers customers retail finance for both new as well
as used cars and wholesale finance to dealers in the automobile trade.

14
ICICI PRUDENTIAL Asset Management Company ICICI PRUDENTIAL
Asset Management Company ICICI PRUDENTIAL Asset Management Company
(KMAMC), a subsidiary of ICICI PRUDENTIAL Bank, is the asset manager for
ICICI PRUDENTIAL Mutual Fund (KMMF). KMMF manages funds in excess of
Rs 16,100 crore and offers schemes catering to investors with varying risk-return
profiles.

ICICI PRUDENTIAL Old Mutual Life Insurance Limited ICICI

PRUDENTIAL Old Mutual Life Insurance Limited is a joint venture between
ICICI PRUDENTIAL Bank Ltd. and Old Mutual plc. ICICI Life Insurance helps
customers to take important financial decisions at every stage in life by offering
them a wide range of innovative life insurance products, to make them financially
independent. ICICI group was founded by Mr. Uday ICICI in Gujarat, He started
his business with the Trade finance and Old mutual plc was a south Africa based
insurance company. After the Joint venture ICICI PRUDENTIAL old mutual life
insurance limited come in insurance sector and become the first NBFC (NON
BANKING FINANCIAL CORPORATION) to convert into a Bank.

Department With In The Company-

Customer Service & Operations

15
The Operations department oils the work processes between the customer and the
company to ensure consistent and quality service to the customer. To streamline
the operations, the Operations department interfaces between the clients and the
agents, the branches and the underwriters, and manages work processes.

IT

The Information Technology function at ICICI life insurance is committed to

enable business through the use of technology. It is segmented into 4 groups to
enable highest levels of delivery to the customers: The Solutions Group- Web that
provides real-time information to customers and is responsible for customer
relationship management, IT Architecture & Corporate Solutions Group is in
charge of developing and maintaining a blueprint for the IT architecture for the
enterprise as a whole. This team works as an in house R&D Solution Group,
exploring new technological initiatives and also caters to information needs of
corporate functions in the organization. IT Infrastructure group is responsible for
providing hardware, software, network services to the whole organization.

Marketing

The Marketing function at ICICI life insurance covers an array of activities - brand
and media management, channel support, direct marketing and corporate
communications. The Brand and Communications team is in charge of advertising,
consumer research, media planning & buying and Public Relations; that helps
develop and nurture ICICI life insurance identity while effectively communicating
its varied product offerings to the customer. Channel marketing provides support to
the sales force by streamlining the design and development of collaterals and sales

16
tools across distribution channels. The Direct marketing team was set up to
generate high quality leads for profitable business. .

Finance

Finance function in ICICI life insurance is committed to create an infrastructure

that is aligned to shareholder expectations. Finance basically comprises of four
functions. . Corporate Planning and MIS provide feedback on business strategies.
This includes driving the budgeting process, providing strategic inputs for
decision-making and management reporting and analysis. The Accounts function
includes preparation and maintenance of financial records, funds management, and
expense processing and treasury operations. Compliance ensures that every action
is within the regulatory framework. This includes reviewing compliance
requirements and supporting the ethical framework of ICICI life insurance. Internal
audit provides assurance to the management over the organizations' control
framework and includes process risk management, information security assessment
and business continuity assessment

HR

The people strategy of ICICI life insurance is "To build a committed team with a
culture of innovation, learning and growth”. The Human Resource Function at
ICICI life insurance drives the people strategy of the business. With its initial focus
on operational excellence to deliver benefits and services to staff members, HR is
now committed to building capability through state of the art processes. A robust
performance management system, compensation system and a segmented training
architecture enable it to deliver value to the organization.
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 Competitors

Licenses have been issued for the following companies

ICICI PRUDENTIAL Old Mutual Life Insurance Limited

ICICI Prudential Life Insurance Company Limited

HDFC Standard Life Insurance Company Limited

Birla Sun Life Insurance Company Limited

TATA AIG Life Insurance Company Limited

Max New York Life Insurance Company Limited

SBI – Cardiff Life Insurance Company Limited

ING Vysya Life Insurance Company Limited

Bajaj Allianz Life Insurance Company Limited

MetLife Life Insurance Company Limited

Aviva Life Insurance Company Limited

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 INTRODUCTION TO THE PROJECT TOPIC

Performance Evaluation

Performance evaluations, which provide employers with an opportunity to assess

their employees' contributions to the organization, are essential to developing a
powerful work team. Yet in some practices, physicians and practice managers put
performance evaluations on the back burner, often because of the time involved
and the difficulties of critiquing employees with whom they work closely. The
benefits of performance evaluations outweigh these challenges, though. When
done as part of a performance evaluation system that includes a standard
evaluation form, standard performance measures, guidelines for delivering
feedback, and disciplinary procedures, performance evaluations can enforce the
acceptable boundaries of performance, promote staff recognition and effective
communication and motivate individuals to do their best for themselves and the
practice.

Objectives Of The Performance Evaluation

Data relating to performance assessment of employees arc recorded, stored. and

used for seven purposes. The main purposes of employee assessment are:
1. To effect promotions based on competence and performance.

19
2. To confirm the services of probationary employees upon their completing the
probationary period satisfactorily.
3. To assess the training and development needs of employees.
4. To decide upon a pay raise where (as in the unorganized sector) regular pay
scales have not been fixed.
5. To let the employees know where they stand insofar as their performance is
concerned and to assist them with constructive criticism and guidance for the
purpose of their development.
6. To improve communication. Performance appraisal provides a format for
dialogue between the superior and the subordinate, and improves understanding of
personal goals and concerns. This can also have the effect of increasing the trust
between the rater and the ratee.
7. Finally, performance appraisal can be used to determine whether HR programs
such a selection, training, and transfers have been effective or not.

Broadly, performance appraisal serves four objectives-

Developmental uses,
Administrative uses/decisions,
Organizational maintenance/objectives, and
Documentation purposes

Multiple Purposes of Performance Assessment

General Applications Specific Purpose

Developmental Uses Identification of individual needs

20

Administrative Uses/Decisions
Bottom of Form
Performance feedback
Determining transfers and job assignments
Identification of individual strengths ad
development needs
Salary
Promotion
Retention or termination
Recognition of individual performance
Lay-offs
Identification of poor performers

The primary goals of a performance evaluation system are to provide an equitable

measurement of an employee's contribution to the workforce, produce accurate
appraisal documentation to protect both the employee and employer, and obtain a
high level of quality and quantity in the work produced. To create a performance
evaluation system in practice, these five steps should be considered:

1. Develop an evaluation form.

2. Identify performance measures.

3. Set guidelines for feedback.

4. Create disciplinary and termination procedures.

5. Set an evaluation schedule.

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KEY POINTS

• A performance evaluation system can motivate staff to do their best for

themselves and the practice by promoting staff recognition and improving
communication.

• Evaluations should be conducted fairly, consistently and objectively to protect

your employees and your practice.

• An effective performance evaluation system has standardized evaluation

forms, performance measures, feedback guidelines and disciplinary
procedures.

1. Develop an evaluation form.

Performance evaluations should be conducted fairly, consistently and objectively

to protect employees' interests and to protect practice from legal liability. One
way to ensure consistency is to use a standard evaluation form for each evaluation.
The form use should focus only on the essential job performance areas. Limiting
these areas of focus makes the assessment more meaningful and relevant and the
employee to address the issues that matter most. ..

2. Identify performance measures.

Standard performance measures, which allow to evaluate an employee's job

performance objectively, can cut down on the amount of time and stress involved

22
in filling out the evaluation form. Although developing these measures can be one
of the more time-consuming parts of creating a performance evaluation system, it's
also one of the most powerful.

3. Set guidelines for feedback.

Feedback is what performance evaluations are all about. So before implement

performance evaluation system, make sure that everyone who will be conducting
evaluations knows what kind of feedback to give, how to give it and how to get it
from the employee in return.. .

4. Create disciplinary and termination procedures.

In some cases, even after a thorough performance evaluation and a discussion of

expected improvements, an employee will continue to perform poorly. We need to
be prepared to handle such a situation by having well-defined, written disciplinary
and termination procedures in place. These procedures should outline the actions
that will be taken when performance deteriorates - a verbal warning, a written
warning.

5. Set an evaluation schedule.

Once built performance evaluation system - the evaluation form, the performance
measures, the feedback guidelines and the disciplinary procedures - just need to
decide when to conduct the performance evaluations. Some practices do all
employee evaluations at the same time of year, while others conduct them within
30 days of each employee's anniversary of employment (the latter may work better
since it spreads the work of the evaluations out for employer and employee).

The last analysis

A performance evaluation system should be a key component of practice structure.

When implemented effectively, it ensures fairness and accountability, promotes

23
growth and development and encourages a sense of pride in your employees'
contributions to the practice.

Performance Evaluation And Competitive Advantage

The objectives of performance appraisal, listed above, point out the purpose which
such an exercise seeks to meet. What needs emphasis is that performance
evaluation contributes to firm's competitive strength. Besides encouraging high
levels of performance, the evaluation system helps identify employees with
potential, reward performance equitably and determine employee's need for
training. Specifically, performance appraisal helps an organization gain
competitive edge in the following ways (see Fig below)

Making
Ensuring
Strategy
Values
Minimizing
Competitive
correct
and
Improving and
Legal
dissatisfaction
Performance and
Behaviour
Compliance
Behavior
decisions
Advantage
turnover

Fig: How Performance Evaluation can contribute to Firm's Competitive

Advantage?

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Improving Performance
An effective appraisal system can contribute to competitive advantage by
improving employee job performance in two ways-by directing employee
behaviour towards organizational goals, as was done by the second beekeeper (see
opening case), and by monitoring that behaviour to ensure that the goals are met.

Making Correct Decisions

As stated above, appraisal is a critical input in making decisions on such issues as
pay raise, promotion, transfer, training, discharges and completion of probationary
periods. Right decision on each of these can contribute to competitive strength of
an organization. If promotion, for example, is made on performance, the promote
feels motivated to enhance his or her performance.

Ensuring Legal Compliance

Promotions made on factors other than performance might land up a firm in a legal
battle, thus diverting its focus on non-productive areas, as it happened to
Williamson Magar. Organizations can minimize costly performance-related
litigation by using appraisal systems that give fair and accurate ratings.

Minimizing Job Dissatisfaction and Turnover

Employees tend to become emotional and frustrated if they perceive that the
ratings they get are unfair and inaccurate. Such employees find that the efforts they
had put in became futile and obviously get de-motivated.
Dissatisfaction in the job sets in and one of the outcomes of job dissatisfaction is
increased turnover. Fair and accurate appraisal results in high motivation and
increased job satisfaction. An organization having satisfied and motivated
employees will have an edge over its competitiveness’
25
Organizational Strategy and Performance Evaluation
The performance evaluation system serves many organizational objectives and
goals. Besides encouraging high level of performance, the evaluation system is
useful in identifying employees with potential, rewarding performance equitably
and determining employees' needs for development. These are all the activities that
should support the organization’s strategic orientation. Although these activities
are clearly instrumental in achieving corporate plans and long-term growth, typical
appraisal systems in most organizations have been focused on short-term goals.
From the strategic management point of view, organizations can be grouped into
three categories defenders, prospectors and analyzers. Performance appraisal has
definite roles in all the three strategies.
Typically, defenders have a narrow and relatively stable product-market domain.
Because of this narrow focus, these organizations seldom need to make major
adjustments in their technology Structure or methods of operations. They devote
primary attention to improving the efficiency of their existing operations.
successful defenders use performance appraisal for identifying training needs.
Organizations with a prospector strategy continuously search for different product
and market opportunities. In addition, these organizations regularly experiment
with potential responses to new and emerging environmental trends. Prospectors
are often the harbingers of change. Because of the emphasis on skills identification
and acquisition of human resources from external sources, as opposed to skills
building with the organization, prospectors often use the performance appraisal as
a means of identifying staffing needs. The emphasis is on results. Finally, the focus
is on division and corporate performance evaluation as they compare with other
companies during the same evaluation period.
Organizations with an analyzer strategy operate in two types of product-.market
domains. One domain is stable while the other is changing. In their more
26
innovative areas, managers watch their competitors closely and rapidly adopt the
ideas that appear promising. In general, analyzers use cost effective technologies
for stable products and project or matrix technologies for new product. Analyzers
tend to emphasize both skill building and skill i1cquisilion and employ extensive
training programs.
Thus, these organizations attempt to identify both training as well as staffing
needs. The appraisal systems are considered at the individual, group and divisional
levels. Finally, successful analyzers have a tendency to examine current
performance with past performance within the organization. Cross-sectional
comparisons (comparisons among 'companies) may also occur.

Evaluation Process

Figure below outlines the performance- appraisal process. Each step in the process
is crucial and is arranged logically. The process as shown in Fig. Below is
somewhat idea1ised. Many organizations make every effort to approximate the
ideal process, resulting in first-rate appraisal systems. Unfortunately, many others
fail to consider one or more of the steps and, therefore, have less-effective
appraisal system.

27
Measuringperformance
Establish
Communicateactual
Standard
expectation
performance

Initiate corrective
Comparison
Discussion oftoappraisal
actual
action
& standard
with employees
performance

28
Some Important Methods Of Performance Evaluation:-

• Behavioral Anchored Rating Scale

• Forced choice distribution
• Checklist
• Ranking Method
• Paired-comparison Method
• Grading & Rating

Performance Management

Performance management system (PMS) is the heart of any " people management "
process in organization. Organizations exist to perform. If people do not perform
organizations don't survive. If people perform at their peak level organization can
compete and create waves.
Performance management systems if properly designed and implemented can
change the course of growth and pace of impact of organizations. In the past
organizations as well as the HR function have wasted a lot of time by wrongly
focusing on performance appraisals rather than performance management.

Objective

The objectives of Performance Management are to:

1. Increase two-way communication between supervisors and employees

2. Clarify mission, goals, responsibilities, priorities and expectations

29
 3. Identify and resolve performance problems

4. Recognize quality performance

5. Provide a basis for administrative decisions such as promotions, succession

and strategic planning, and pay for performance.

Principle Of Developing Performance Management Plan

Development of a performance management plan should be consistent with the

following principles:

1. Performance management is considered a process, not an event. It follows

good management practice in which continual coaching, feedback and
communication are integral to success.

2. The Performance Management Plan is primarily a communication tool to

ensure mutual understanding of work responsibilities, priorities and
performance expectations.

3. Elements for discussion and evaluation should be job specific – not

generalized personality traits. The major duties and responsibilities of the
specific job should be defined and communicated as the first step in the
process.

4. Performance standards for each major duty/ responsibility should be

defined and communicated.

5. Employee involvement is encouraged in identifying major duties and

defining performance standards.

6. Professional development should be an important component of the plan.

30
 7. The formal evaluation period should be long enough to allow for full
performance and to establish a history such that evaluations are fair and
meaningful. One year is a common evaluation period.

8. Documentation of performance will occur as often as needed to record the

continuum of dialogue between supervisor and employee.

9. If formal ratings are included, they should reflect the incumbent's actual
performance in relation to the performance standard for that major duty.

10.The supervisor should be evaluated on the successful administration of the

plan and ongoing performance management responsibilities.

Process Of Performance Management

Employee performance management includes:

• planning work and setting expectations,

• continually monitoring performance,

• developing the capacity to perform,

• periodically rating performance in a

summary fashion, and

• rewarding good performance.

.

In an effective organization, work is planned out in advance.

31
Planning means setting performance expectations and goals for
groups and individuals to channel their efforts toward achieving
organizational objectives. Getting employees involved in the
planning process will help them understand the goals of the
organization, what needs to be done, why it needs to be done, and
how well it should be done.

In an effective organization, assignments and projects are monitored

continually. Monitoring well means consistently measuring
performance and providing ongoing feedback to employees and
work groups on their progress toward reaching their goals.

In an effective organization, employee developmental needs are

evaluated and addressed. Developing in this instance means
increasing the capacity to perform through training, giving
assignments that introduce new skills or higher levels of
responsibility, improving work processes, or other methods.
Providing employees with training and developmental opportunities
encourages good performance, strengthens job-related skills and
competencies, and helps employees keep up with changes in the
workplace, such as the introduction of new technology.

From time to time, organizations find it useful to summarize

employee performance. This can be helpful for looking at and

32
 comparing performance over time or among various employees.
Organizations need to know who their best performers are.

In an effective organization, rewards are used well. Rewarding

means recognizing employees, individually and as members of
groups, for their performance and acknowledging their contributions
to the agency's mission. A basic principle of effective management
is that all behavior is controlled by its consequences. Those
consequences can and should be both formal and informal and both
positive and negative.

Managing Performance Effectively. In effective organizations,

managers and employees have been practicing good performance
management naturally all their lives, executing each key component
process well. Goals are set and work is planned routinely. Progress
toward those goals is measured and employees get feedback. High
standards are set, but care is also taken to develop the skills needed
to reach them. Formal and informal rewards are used to recognize
the behavior and results that accomplish the mission. All five
component processes working together and supporting each other
achieve natural, effective performance management.

Performance Management System

33
Introduction
The human resource is the organization's most valuable asset. They define the
efficiency, effectiveness and over-all quality of service in any industry. It is
important for any organization to establish an effective system that accurately
evaluates the performance of workers for the purpose of determining tenure,
transfers or promotions, and appropriate incentives.
While policies and systems for employee performance evaluation have long been
in place in the government, there has been an increasing demand to review the
existing system, i.e. demand for public servants to produce tangible results by
"making a difference" instead of "just keeping busy," demand for increased
accountability by performing the mandate of the organization, the need to correct
the notion that a permanent appointment guarantees security of tenure. Hence, the
call for the Civil Service Commission (CSC), as the central personnel agency of
the government, to revisit and, as necessary, re-invent the performance
management system of the bureaucracy.
The development of the performance management system for the civil service was
initiated by a re-assessment of the existing Performance Evaluation System (PES).
This resulted to the Performance Management System - Office Performance
Evaluation System (PMS-OPES)-a new strategy that will establish a culture of
performance and accountability in the bureaucracy.
Through the PMS-OPES, the CSC aims to establish a high-performance culture by
aligning individual objectives to the organizational objectives. The new
performance management system would meaningfully and objectively link
employees performance vis-à-vis an agency's Organizational Vision, Mission, and
Strategic Goals by using a technology composed of various strategies, methods,
and tools for ensuring fulfillment of the functions of the offices and its personnel
as well as for assessing the quality, quantity, and timeliness of the
accomplishments. It is a systematic process for improving organizational
performance by developing the performance of individuals and teams. It is a means
of getting better results from the organization, teams and individuals by
understanding and managing performance within an agreed framework of planned
goals, standards and competence requirements. Processes exist for establishing
shared understanding about what is to be achieved, and for managing and
developing people in a way that increases the probability that it will be achieved in
the short and longer term.
The unique component of the PMS-OPES is the use of points system to measure
the collective performance of individuals within an operating unit. It simplifies the
performance evaluation/measurement process and also provides an objective and
user-friendly performance management system.

34
The Performance Management System - Office Performance Evaluation
System (PMS-OPES)
The PMS-OPES is a new way of managing performance in the civil service that
serves as an evaluation strategy for assessing office performance or the collective
performance of individuals within the smallest operating unit of an organization.
By measuring office performance, it becomes easier to directly translate the
agency's strategic direction into more specific and measurable objectives. It also
serves as a standard-setting mechanism for better alignment of individual
objectives to agency objectives. Moreover, it enhances objectivity of individual
performance evaluations.

The following are the objectives of the PMS-OPES:

1. To align individual performance goals with the organization's strategic

goals/vision;
2. To ensure organizational effectiveness by cascading institutional accountabilities to
the various levels of the organization's hierarchy;
3. To have performance management linked to other HR systems; and
4. To link agency overall performance to the Organizational Performance Indicator
Framework, to the Agency Strategic Plan, and to the Medium-Term Philippine
Development Plan.

Environmental Performance Evaluation :

What is lt?
The EMS standard requires organizations to develop measurable objectives and
targets, and to monitor and evaluate their performance against them. The EMS
does not audit this performance but it does audit the management of performance
objectives and target. SC4 is developirig a guideline to help organizations manage
tliis monitoring and evaluation process.

35
The basic premise is that what gets measured gets done. Measurement allows an
organization to more clearly understand and quantify where it is and how far it has
to go to meet its objectives and targets. lt also provides a basis for understanding
improvement. The EPE then will provide the organization with a systematic tool
for generating information. A necessary element of generating useful information
is selecting or defining the environmental performance indicators (EPIS) or
performance measures that will be used.
EPE is different from environmental audits in several significant ways. EPE is an
ongoing process. As part of the management system it is something that is put in
place and available at all times. It helps to define actions, responsibilities and
information flows that are part of ongoing, day-to-day operations, An
environmental audit ls a snapshot In time. It is a periodic verification that
everything is as it should be. As well, while the evidence collected during an audit
is existing evidence, the information generated by an EPE is new evidence. While
within the framework of and EPE an organization can conduct research and
investigate new issues, within an audit one can only assess claims concerning the
current state.
Since an EPE system provides the framework for information gathering it also
provides a logical link to reporting. Organizations will have many internal and
external reporting requirements and EPE system can ensure that the information is
gathered and disseminated correctly and on time. Many organizations also choose
to voluntarily report on their environmerital management system or environmental
performance. The systematic collection and generation of information provided by
the EPE system provides tremendous efficiencies of effort should an organization
decide to report voluntarily.
How It Works
The standard being developed by SC4 will allow organizations to develop
appropriate systems to measure, evaluate, describe and communicate
environmental performance. lt is part of the environmental management system
and not separate from it. Thus ISO 14001, the EMS specification document,
requires that an organization monitor and measure on a regular basis the key
characteristics of its operations and activities. The developers of this standard,
however, intend to develop a document that will be useful to an organization that
wishes to evaluate its environmental performance whether or not it has a formal
environmental management system in place. If an organization without and EMS
wishes to use the EPE system it must still have a mechanism for developing
objectives and targets since the EMS document and not the EPE document
provides this guidance.
The current draft of the EPE document contains the following elements:

36
Planning EPE
Management corisiderations
Selecting indicators for the management area
Selecting indicators for the operational area
Selecting iridicators for the environmental area
Evaluating Environmental Performance
Collecting data
Analyzing data
Evaluating information
Internal reporting and communicating
External reporting and communicating
Reviewing and improving EPE
Planning involves reviewing or identifying those environmental aspects of an
organizations activities products and services that have generated objectives and
targets. It is essential that the EPE process be integrated with the EMS since the
development of objectives and targets should include identifying what an
organization wants to measure and therefore how it wants to measure it.
The selection or definition of environmental performance indicators is key at this
juncture. There is much debate about the development or EPIS. Should there be
generic EPIs across sectors? Common EPIs would provide the basis for
comparison and benchmarking. They might also provide the basis for generation of
national, regional or international environmental accounts. But is the development
of such generic EPIs possible given the diversity of business operations, local
conditions and measurement capabilities? Should individual sectors develop their
own EPIS? If generic. EPIs are too difficult to develop should sector-based EPIs he
developed?
In 1992, SC4 set itself the goal of developing generic and sector specific EPIs but
soon abandoned it as too large a project. They also had to ask themselves if they
were the right group to develop sectoral EPIS. Perhaps ttie industry associations,
which are able to bring together all of the experts in their area, should be
encouraged to undertake this task. Sector efforts to date to do this have proven
difficult. Organizations are wary of helping to create indicators tliat will allow
them to be too easily ranked for environmental performance against their
competitors.

37
 PROJECT PROFILE

Title Of The Study

Title of the study is ANALYSING THE PERFORMANCE EVALUTION AND

MANAGEMENT IN OLD MUTUAL ICICI LIFE INSURANCE.

Objective Of The Study

The main objective of this study is to know the awareness, perception and
satisfaction level of employees regarding the Performance Management System,
and to evaluate and analyze the effectiveness of the system, i.e.

➢ To study the Performance Management System (PMS) prevailing in the

organization.
➢ To evaluate and analyze the working of the system.
➢ To study the awareness of this system among the employees in order to
know how much they know about it, how much are they involved in it, their
commitment to the system, their perception about the system and whether
they are satisfied with it or not.
➢ To study the effectiveness of this system in the organization.
➢ To make suggestion.

Scope Of The Study

During the tenure of the project/summer training attempt is to understand the work
culture and processes involved in the HR Department of Old mutual ICICI life
insurance. Attempt would be to analyze, how the HR deals with aspect of people
management.

38
In the latter part of the project a study would be conducted on the Performance
Evaluation and Management System, where a detail analysis is planned to
understand the methods, process and analysis of the evaluation and management
system

Significance Of The Study

This study is beneficial for both to the company and the researcher

To The Company –
This project is advantageous to the company because-
• Through this company can what are the faults in their performance
evaluation and management system and it can be able to remove those
faults.
• Company can know satisfaction level of their employees.
• Employee’s expectation from the company.
• Employees performance
• This report also help the company that where its system works successfully
and how it can be maintained
• This project report suggests the company that what changes should be there
in the current performance and evaluation and management system to gain
the competitive advantage

To the Researcher –
This project is necessary to the researcher –
• Being a management student it is necessary to gain the practical knowledge
about the corporate world and the market this project gives the practical
exposure to the researcher

39
 • Through this project researcher knew how performance being evaluated by a
company and how manage it
• This is also useful because this project generated new ideas in the researcher
that how a company maintained their performance evaluation and
management system so that it can be enough motivated to their employees to
their employees and also gain competitive advantage `

RESEARCH METHODLOGY

UNIVERSE
The first step in developing any sample design is to clearly define the set of
objects, technically called the universe. The population was finite.
A definite plan was drawn up for obtaining a sample from the employees of the
ICICI life insurance in KOTA.

Sampling Technique

40
Research in common parlance refers to a search of knowledge. Research
methodology comprises defining and redefining problems formulating hypothesis
or suggested solution; collecting, organizing and evaluating data making deduction
and reaching conclusion and at last carefully testing the conclusions to determine
whether they fit the formulating hypothesis.
In it I study the various steps that are generally adopted by a researcher in his
research problem along with the logic behind them. It is necessary for the
researcher to know not only the research method but also the methodology.

Random sampling:-
This type of sampling also known as chance sampling or probability sampling
where each and every item in the population has as equal chance of inclusion in the
sample and each one of the possible sample has the same probability of being
selected.

Research Design:-

A research design is the arrangement of conditions for collection and analysis of

data in a manner that aims to combine relevance to the research purpose with
economy in procedure. Exploratory research design is used.
The research study was conducted in order to know the employee’s awareness and
perception level regarding the prevailing Performance Management System in
ICICI life insurance Ltd.

Tools Of Data Collection

41
Since the study under taken by me is descriptive research, I have concentrated
on primary data through survey and collection secondary data.
On the basis of the following two sources, the research was carried out:-
1. Primary Data
2. Secondary Data

1. Primary Data:-

a) Questionnaire Method: The main instrument for the collection of

primary data was the Questionnaire Method. The questionnaires were
prepared for sales managers which mainly contained questions on the
following dimensions:-

○ Awareness
○ Measures of Performance
○ Feedback
○ Perception

b) Informal discussion: Informal discussions were carried out with sales

managers across various levels in the organization to know the
prevailing system, awareness level and also to know their viewpoints
on PMS.

2. Secondary Data:-
Secondary data was collected by reviewing different literatures like articles,
magazines, journals, etc and also through different websites.

42
Limitations Of The Study:

The researcher tried to make the research work as authentic as possible.

However the following constrain still unavoidable:

• All the results and conclusions have been drawn on the basis of the
information provided by the respondents not denied that there was
always a possibility of response error.
• Some respondents were reluctant and were tend to filter the information
to the researcher.
• The sample size taken may not prove adequate for conditions.

DATA ANLYSIS

• What is your job profile in this company.

43
 45
40
40
NO OF RESPONDENTS

35
30
25 Series1
20 Series2
15
10
5
5 3
1 1
0
sales manager asst. branch mktg manager training head operation
manager
DESIGNATION

Interpretation

Sample size is taken 50 out of which 40 persons are Sales Manager, 3are the Asst.
Branch Manager, 1 is the Marketing Manager, 1 is the Training Head of Rajasthan
and the 5 persons are working in the Operation Department of the company

• Satisfaction level from the job profile.

44
 NO
22%

YES
NO

YES
78%

Interpretation
During the survey I found that out of 50 employees 78% employees said that they
are satisfied with their job profile while the 22% said that they are not satisfied
with their job profile with in the company.
• Satisfaction level from the facilities provided by the company
.

45
 yes no yes
94% 6% no

Interpretation
out of 50 employees 94% employees were satisfied the facilities provided by the
company to do their their work. On the other hand only 6%employees were not
satisfied by the facilities.

• Achievements in current job profile

46
 45%
40%
40%
35%
30%
PERSENTAGE

30%
25% Series1
20%
20% Series2

15%
10%
10%
5%
0%
grade salary rewards other
achievments

Interpretation
Out of 50employees 20%said that they got achievements in grade, 30%in salary,
40%got many rewards while 10%said other achievements like L.A. counted in
manager.
• Achievements satisfied organization need

47
 NO
0%

YES
100%

Interpretation
When the question were asked to the employees that their achievements satisfied
the organization need then the response was 100%. Everyone said that their
achievements fulfill the company needs.

• Analysis the quality of the work

60%
0.6

0.5

0.4

PERCENTAGE 0.3
20%
0.2 c
10% 10%
0.1

0
considerably exceeded met minimum less than
surpassed minimum requirements minimum
minimum requirements requirements
requirements

48
Interpretation
Out of 50 employees 60% said that they met the surpassed minimum requirements,
10%employees met the exceeded minimum requirements, 20%met minimum
requirements, 10% were not able to met the minimum requirements of the
company.
• Evaluate the performance in unsupervised condition

unsuccess
11%

more
less
less more unsuccess
33% 56%

Interpretation
Out of 50 employees 56%employees said that their assignment became very
successful even when there were no guidelines of the company, 33% employees
got less success, 11%became unsuccessful.

• Acquired skill to gain competitive advantage

49
 70%
0.7

0.6

0.5

0.4
PERCENTAGE Series1
0.3 25% Series2

0.2

0.1
3% 2%
0
managerial technical communication other

Interpretation
Out of 50 employees 70% aquired the managerial skill from their current position,
while 3%technical, 25%communication, 2%said other skill like stress handling,
finance related knowledge.

50
 • Measuring the creativeness in terms of showing initiative

0.7
65%
0.6

0.5
PERCENTAGE

0.4

0.3

0.2 20%

0.1 10%
5%
0
displayed displayed some displayed little displayed no initiative
considerable initiative initiative initiative

Interpretation
Out of 50 employees 65%employees displayed considerable initiative to achieve
their target while 20%displyed some initiative, 10%displayed little initiative,
5%displayed no initiative.

• Checking the managerial skill in utilizing resources

51
 80%
0.8

0.7

0.6
0.5
PERCENTAGE 0.4 Series1
0.3 Series2

0.2 Series3
10% 10%
0.1
0
through through through all the above
motivation contests and incentives and
schemes gifts

Interpretation
Managerial skill in utilizing resources on the following two bases
1. manpower
2. money
80% Managers said that they are utilizing their resources through incentives and
gifts, contests & schemes and through motivation while only 10%through
incentives and gifts, 10%through contests and schemes and no one using
motivation tool in utilizing resources
• Performance evaluation criteria by the company

52
 69%
70%

60%

50%

40%
PERCENTAGE 30% Series1
30%

20%

10%
1%
0%
on time on target on cost all

Interpretation
Out of 50 employees 69%said that they were evaluated by the company on the
basis of time, cost and on time, 30%on target, 1%on timely basis and no one were
evaluated on the cost basis.

• Performance evaluation technique of the company

53
 other method 6%
checklist
METHODS

cost accounting
paired comparison
Raking 20%

grading & Rating 0 74%

0 0.2 0.4 0.6 0.8

PERCENTAGE

Interpretation
Every company have their techniques to review the performance of their
employees. In ICICI life insurance 74% employees said that their performance
review by Grading &Rating, 20% were by ranking, and 5%were by other method
like career express.

• Performance improvement suggestions from the employees side to the

company

54
 other
promotion
22%
28%
promotion
salary
training
enviroment enviroment
11% other
training salary
17% 22%

Interpretation
Every employee wants some changes so that he/she perform better. In this regard
ICICI’s employees also gave some suggestion to improve their performance.
28%said that should be promoted, 22%said salary enhancement, 17%wants more
training programs, 11%wants changes in environment and 22%wants other like in
Infrastructure, all the above mentioned.

• Employees relation with the company

55
 0.9
85%
0.8
0.7
PERCENTAGE

0.6
0.5 Series2
0.4 Series1
0.3
0.2
0.1 11%
0 2% 2%
e
e

f
y

t iv
t iv

iv

tiv
or

e
or
at
uc

ra

ld
ct

uc
ct
er

al
fa

fa

e
od
od

op

op
tis

tis
pr

pr

co
co

sa
sa

un

un
un

Interpretation
when the question was asked to the employees how they characterized their
relation with the company 2% said satisfactory, 2%unsatisfactory, 11%productive,
85% said that their relation with the company was satisfactory, cooperative and
productive.
• Gender

female
10%

male
female

male
90%

56
Interpretation
Sample size was taken 50 out of which 90%are the male employees, meanly
10%are the female employees.

• Age group

80%

70%

60%
PERCENTAGE

50%

40% Series1

30%

20%

10%

0%
20-30 31-40 41-50 50-ABOVE
AGE

Interpretation
Out of 50 employees 70%were under the 20-30 age, 25%were 31-40 age, 5% were
under 41-50.

57
 SWOT ANALYSIS

The internal and external situation analysis can produce a large amount of
information, much of which may not be highly relevant. The SWOT analysis can
serve as an interpretative filter to reduce the information to a manageable quantity
of key issues. The SWOT analysis classifies the internal aspects of the company as
strengths or weakness and the external situational factors as opportunities or
threats. ICICI Life Insurance also has many strength and weakness and opportunity
and threats.

Strengths: -
Effective bank support in service: ICICI life insurance have full support in
service by ICICI bank which have branches across India.

Effective management team: ICICI management team is mixture of experience

for guidance and youth for successful implementation.

Varity in product and good service: ICICI have various plans for individual,
group and rural sector and give more emphasis on providing good services to its
customer.

Brand name and goodwill of the company: Kodak have very good image in
financial market.

Good Rewards and Recognition program and effective advisors team: ICICI
have good rewards and recognition program which are held time to time to
motivate its employees and the advisors.

58
Self fund management house: ICICI is the only company in India which has its
own fund management house.

Stability of the employees: ICICI provide good facilities, salary and environment
to its employees to make them more stable.
Weakness:-
Small number of staff: total number of employees in KOTA branch is not enough
and the office is also do not have need space as required.
Lack of marketing: another major weakness with ICICI life insurance is lack of
efforts in the marketing of product. There are many few areas where we can see
any kind of marketing push made by company.
Lack of co-ordination among the staff
Lack of trust on company by the customer
Weak in maintaining professional relation: another problem which I have
personally seen is the lack of follow up. ICICI life insurance is not able to handle
and use advisors in proper way.

Opportunities:-

Huge market potential: - the Rajasthan market is very wide the only thing which
is requiring covering it is right approach. But ICICI life insurance is only now in
KOTA and Jodhpur and can spread branches across Rajasthan.

Huge potential for marketing: - insurance sector now in its boom period so there
is a very huge potential for marketing.

People acceptance: - people are ready to use ICICI life insurance product but only
thing is ICICI is not knocking their door at the right time.

New investment plans: - company should be developed new investment plans that
are different from other company.

59
More training programs for the employees and the advisors: - more training
programs for employees beneficial to improve the co-ordination and both of the
employees and the advisors will help the company in maintaining its goodwill in
the market.

Threats:-
Competitors:-the major threat is the kind of competitors in market. The
competitors like ICICI prudential, HDFC standard life insurance, RELIANCE life
insurance, SBI life insurance and many more. ICICI life insurance also facing a lot
of competition from local players.
New players: - new players are coming
Good investment plans of its competitor: - other companies provide good
investment plans.
Delay in marketing decision: - another major threat is delay in marketing
decision as this delay becomes a benefit for ICICI life Insurance competitor.

CONCLUSION

The study undertaken at ICICI life insurance on Performance evaluation and

Management System gave us a lot of exposure and knowledge in the field of
Performance Management. Throughout the study, we analyzed the perception and

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awareness level of employees regarding existing Performance Management
System in ICICI.

The procedure laid down in this system is quite clear to the concerned persons who
have been given the job to measure the performance of various individuals. But yet
the persons (sales manager) at the various levels for whom this policy has been
implemented are not well aware of the procedure and policies followed by this
system.

This policy is capable of identifying the individual’s performance and is able to

give information to the management relating to individual performance efficiency,
his promotion criterion and the performance deficiency and means and ways to
minimize his deficiency and take corrective measures to develop the skills of
individuals which is required for the future needs of the organization.

The performance of the sales manager is quite satisfied according the organization
need but if we measured in terms of the team spirit and in using resources it will
become quite low because they knew only selling how their targets can be
achieved but they don’t know that how these targets can be achieved through the
co-ordination or resources in a sequential way.

One more important thing is that some employees do their work in stress and they
show it in behave which makes the bad image of the company in the eyes of the
outsiders.

Apart from all this, the management could not implement this system in its true
spirit, yet they are working hard to derive benefits from this. From This day this
PMS is carried on as per stipulated procedures and policies then it is definitely

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going to earn fruitful results for the company (i.e. ICICI life insurance) and will
garnish the entire organization with its presence.

SUGGESTIONS

• Company’s norms, policies and procedure should be clear in the mind of the
employees so that they have proper idea because they are the representatives
of the company.
.
• The communication package should be more effective. And every
information about pms process should be timely communicated to the employees.
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• Managerial skill should be developed in employees so that they give more
benefits to the company.

• More training programs should be conducted to change the mind set of the
employees that their work is not only is selling but also overall development of
the company.

• Some team activities should be there so that the team sprit could be
generated.

• In insurance sector stress is the main problem of the employees so some

stress handling sessions should be there so that they can do their work more
effective way.

• Induction program should be conducted so that new employees can adjust

themselves & perform well.

• Some changes are also required in the infrastructure & working

environment. It should be more comfortable.

• Superiors should give more time to employees while they are discussing on
the issue of Performance. So that an employee can discuss all aspects of his/her
strengths and weaknesses.

• Performance Management System (PMS) should be accepted in its true

sense; it means the policy should be followed as per stipulated method. One
should not try to remove trunk from Ganesh’s Statue.
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 • Feedback should be given regularly so that individuals could rectify their
performance deficiency within the short period and not after one assessment year.

ANNEXURE (QUESTIONNAIRE)

ANALYZING THE PERFORMANCE EVALUTION AND MANAGEMENT

PROCESS OF ICICI PRUDENTIAL OLD MUTUAL LIFE INSURANCE
LIMITED KOTA

QUESTIONNAIRE

1. What is your job profile in this organization?

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2. Are you satisfied from your job profile?
a) Yes
b) No

3. Are you satisfied from the facilities provided by the company?

a) Yes
b) No

4. What are your achievements in current job profile?

a) Grade________________________
b) Salary________________________
c) Reward and awards_____________
d) Other achievements_____________

5. Are your achievements satisfied the organization needs?

a) Yes
b) No
6. To what extent your reports and documentation accurate and complete?
a) Considerably surpassed minimum requirements
b) Exceeded minimum requirements
c) Met minimum requirements
d) Less than minimum requirements

7. Is there any assignment when you work unsupervised.

a) Yes b) No
Is it successful or not?
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 a) More successful
b) Less successful
c) Unsuccessful

8. Which skill you have acquired in your present or previous position that makes
you competitive for this position?
a) Managerial skill
b) Technical skill
c) Communication skill
d) Other skill

9. To what extent you displayed initiative in meeting requirements?

a) Displayed considerable initiative
b) Displayed some initiative
c) Displayed little initiative
d) Displayed no initiative

10. How you are utilizing your resources (manpower, money) to achieve your
target within time and cost?
a) Through motivation
b) Through contests and schemes
c) Through incentives and gifts
d) All the above
e) Any other_____________________________________________

11. On what basis company reviews your performance

a) On the basis of time
b) On the basis of target
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c) On the basis of cost
d) All the above

12. What techniques are used by the organization to review your performance?
a) Grading & rating
b) Ranking
c) Paired comparison
d) Cost accounting
e) Checklist
f) Other methods

13. What steps should be taken by the organization to improve your performance?
a) Promotion
b) Incentive with salary enhancement
c) More training programs
d) Improvement in working condition
e) Any other________________________________________________________

14. How you associate yourself with organization?

a) Unsatisfactory d) Satisfactory
b) Unproductive e) Productive
c) Uncooperative f) cooperative
h) All D E F

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PERSONAL DETAILS--
----------------------------------------------------------------------------------------------------
---------------------
(a) Name: - -------------------------------------------------------------------------

(b) Gender: - (1) Male (2) Female

(c) Age: - (1) 20-30 (2) 31-40

(3) 41-50 (4) 50-above

(d) Address: - ----------------------------------------------------------------------------------

----------------------------------------------------------------------------------------------------
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----------------------------------------------------------------------------------------------------

(e) City -----------------------------.

Phone No……………….. Mobile No…………………..

.
(f) Marital Status: - (1) Single (2) Married

(g) Designation-
(h) Educational Background………………………………………………………

BIBLIOGRAPHY

• Kothari, C.R.(2005), Research Methodology

• C.B. Mamoria, S.V. Gankar, Personnel Management

• Aswathappa, Human Resource & Personnel Management

• www.humanresources.about.com

• www.ICICI. Com

• www. MyICICIlife.com

• www.ICICI life insurance.com

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.

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