TO STUDY THE TRAINING AND DEVELOPMENT AND COMPENSATION PLAN BY MAX NEW YORK LIFE AT AGENT LEVEL

Submitted in partial fulfillment of the requirement for Master of Business Administration (MBA)
By Shobha yadav Roll No. Batch of 2010-12

ARMY INSTITUTE OF MANAGEMENT & TECHNOLOGY, PLOT NO.M-1 POCKET P-5, GREATER NOIDA-201306 (UP) July 2011

ACKNOWLEDGEMENT

In every professional course, projects are very important factor. professors give us theoretical knowledge of various subjects in the college but we are practically exposed of such subjects when we get the project work. it is only the projects through which we come to know that what an industry is and how it works. It gives me immense pleasure to express my deep sense of gratitude to Mr. SHARAD GOEL, DIRECTOR (official), Army Institute of Management and Technology , GREATER NOIDA, for his valuable guidance and consistent supervision throughout the course.

My sincere thanks to Mr. VIKRAM RAJPUT ( Sr. Associate partner- Agency Management), and Mr. Rajeev pathak (Sales manager). My Company Guide of Max New York Life Insurance Company, Green Park NEW DELHI. for her cooperation and help, without whose encouragem ent, guidance, facilities, invaluable support and inspiration, this work woul d not have been possible. I take this opportunit y to express m y sincere and profound gratitude to her for providing m e thi s opportunit y t o learn about Max New York Life Insurance one of m y dream Companies, where each da y was a new l earning and also for guiding me at all phases of t he project stud y. I am extremely thankful to Mrs. Shikha Bhardwaj Faculty Guide of AIMT, for her timely guidance and support throughout the Final Report work. in the course of carrying out the project work. Finally I am indebted to our other faculty members, my friends and my parents who gave their full-fledged co-operation for successful completion of my project. It was a indeed learning experience for me.

Student Name

Signature-

SUPERVISOR CERTIFICATE

This is to certify that Ms SHOBHA YABAV a student of M.B.A(full), ARMY INSTITUTE OF MANAGEMENT AND TECHNOLOGY, Greater Noida, has completed her project under my supervision. During this period she worked under the project title TO STUDY THE TRAINING AND DEVELOPMENT AND COMPANSATION PLAN BY MAX NEW YORK LIFE AT AGENT LEVEL. In the partial fulfillment for the award of the degree of Master of Business Administration of GGSIP University, Delhi. To the best of my knowledge the project work done by the candidate has not been submitted to any university for the award of any degree. Her performance and conduct has been good.

External Examiner-

Signature- Name of Supervisor-

Signature-

Certificate of Originality

I Roll No ____________________________________________of 2010, a full time bonafide

student of first year of Master of Business Administration (MBA) Programme of Army Institute of Management & Technology, Greater Noida.

I__________________________________________ hereby certify that this project work carried out by me at the report submitted in partial fulfillment of the requirements of the programme is an original work of mine under the guidance of the industry mentor____________________________________________________________ and faculty mentor_____________________________________________________ and is not based or reproduced from any existing work of any other person or on any earlier work undertaken at any other time or for any other purpose, and has not been submitted anywhere else at any time.

(Student's Signature) Date: July --, 2011

EXECUTIVE SUMMARY

EXECUTIVE SUMMARY
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This Report is an attempt to provide a detailed analysis of the process of training program done by Max New York Life Insurance along with the overall concepts of training ,Development , Compensation , benefits of the training, and after the training program how compensation are calculated on the bases of commission.

In my complete student internship program I met more than 90 employees. During this student internship program I came to know that, knowledge based economy, training helps people to learn how to do things differently or to do different things. There are two main purpose of the project first one is to have an idea as to how the training provided by Max New York Life because this is the only one insurance company which provide training to their Agent and ADMs (Agency development managers) . Second is two understand the clear concept of commission based compensation. How it is calculated? How this concept provide motivation to the agents and advisers.

Amongst the vast topics of Training and Development and Compensation, this project covers some basic concepts like the meaning, objective, and the role of Training and Development in insurance sector, resent trends of insurance sector, future and so on. My research with different topics and areas of training provided me an opportunity to understand how the management in the Organization takes effective steps to ensure that the employees are retained in the organizations and how their skills are enhanced. The project has been a great experience and has helped a great deal in knowing how the organization works and implementing theoretical concepts to real life situation.

TABLE OF CONTENTS
Acknowledgementii Supervisor certificateiii
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Certificate of Originality...iv Certificate from industry mentorv Executive Summaryvi Sr.No. 1 2 TOPIC Objective of the study Introduction 2.1. Meaning of insurance business 2.2. History of insurance industry 2.3. Indian insurance industry 2.3. IRDA Guidelines Literature Review 3.1 Training and Development 3.1.1. Meaning of Training 3.1.2.Objective of Training 3.1.3.Importance of training 3.1.4.Inputes in Training and Development 3.1.5.Benifits of Training 3.1.6.Method of Training 3.1.7.Meaning of Development 3.1.8.Objective and importance of development 3.1.9.The Training and Development Programs 3.1.10. The training process 3.2. Compensation Management 3.2.1.Meaning of compensation 3.2.2.Objective of Compensation 3.2.3.Impotance of Compensation 3.3.The Organisation 3.2.1.Max New York Life Insurance 3.2.2.Training programs at MNYL 3.2.3. Compensation management at agent level Research Methodology 4.1.Introduction 4.2.Type of Research Design 4.3.Methodology 4.4.Data Collection and Analysis Findings Recommendation Conclusion References Page No 10 11-19

20-72

73-75

5 6 7

76 77 78 79

LIST OF FIGURES
7

Figure No.

Figure description

Page No.

Figure 1. Figure 2. Figure3. Figure 4. Figure 5.

Life insurance market growth The training process Steps in training program HIERARCHY of MNYL Z Card Analysis
35 38 48 64

LIST OF TABLE

Table No.

Figure Description

Page No.

1. 2. 3. 4. 5. 6. 7. 8. 9. 10.

List of insurance companies . Methods of training Effectiveness of Training method Techniques of Training Types of compensation Product knowledge analysis Agents First start incentive Quarterly case rate bonus Agents compensation and maximum earning Prior , premier ,platinum

15 27 28 33 39 52 60 61 66 67

CHAPTER 1

OBJECTIVE OF THE STUDY

To understand the training need identification of agent in Max New York Life. To understand the process and procedure of conducting training in organization. To find out what is the result for the organization because of giving the training to the agent. To find out the benefits of the training program to the agent. To understand performance based compensation for agents.

CHAPTER 2
INTRODUCTION

2.1 Meaning of insurance business

Its now been more than a decade since the opening up of the insurance sector in India to the private sector and for foreign players. The past decade has seen considerable growth in the insurance sector and has seen the introduction of a large number of innovative products a natural and positive outcome of increasing competition. The insurance sector plays a very crucial role in the economy of any country it increases avenues for savings of individuals, protects the future of individuals and spreads risks of institutions by forming a large pool of fund. The sector also contributes significantly to the capital markets and assists in large capital infrastructure developments of our country through their funds.

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The insurance industry in India is divided into 2 basic sectors Life Insurance and Non-life Insurance (also called General Insurance and even called Property and Casualty or P&C). Both these sectors are governed by Insurance Regulatory and Development Authority (IRDA) of India which is a government body which frames the rules for the entire industry and all insurance companies have to abide by them. IRDA is the policy maker for the entire insurance industry in India and also serves as the custodian of consumers rights. As the name suggests life insurance companies cover the risks associated with the life of a person and non-life insurance companies cover other risks associated with our daily living like health, our vehicles, travel and home insurance to name a few. Non-life insurance sector also covers a lot of other risks in the corporate world from simple car insurance to insuring entire factories and industrial equipments. Over a period of time life insurance policies have started incorporating an investment component along with the basic insurance cover so that your money grows while it remains invested with the insurance companies details about these types of policies will be taken up in detail in the forthcoming posts in this series. But non-life insurance companies have so far been restricted to pure risk cover itself.

2.2 Brief History of Insurance Sector in India

The insurance sector in 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 190 years. The business of life insurance in India in its existing form started in India in the year 1818 with the establishment of the Oriental Life Insurance Company in Calcutta. Some of the important milestones in the life insurance business in India are: 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.

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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 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.

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 (Nationalization) Act, 1972 nationalized the general insurance business in India with effect from 1st January 1973.

107 insurers amalgamated and grouped into four companies viz. the National Insurance Company Ltd., the New India Assurance Company Ltd., the Oriental Insurance Company Ltd. and the United India Insurance Company Ltd. GIC incorporated as a company.

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2.3 Indian Insurance Industry:

An Overview of the Insurance Industry in India The history of the insurance industry in India dates back in 1818 when the first insurance company was formed. (Oriental Insurance Company Limited). It has since undergone several reforms in the form of liberalization and nationalization. In the ensuing discussion, we shall seek to explore the nature of the industry in general. Regulation And Players In The Industry This industry is regulated by the Insurance Regulatory & Development Authority (IRDA). It ensures that all policyholders interests are protected. IRDA has listed all stakeholders in the industry including corporate agents, brokers, surveyors, insurance councils, state and life insurers and one main reinsurer.

These players in the market are the driving force towards achieving a record 3% of the gross domestic product in the economy in India. The brokers, for example, are assigned the work of distributing the premiums mainly through direct sales. IRDA also offers guidelines with regard to investment in mutual funds, pension, general annuity funds and group schemes.

Current market Scenario

LIC is by far the biggest life insurance company in India both in terms of market share and their presence in India it is the only government owned entity. Most of the private players, in both life and non-life sectors, have started business in India with the partnership of established insurance players in the world. The expertise of these global players help the Indian insurance companys perform much better as they can replicate the learning gained from other markets over a large period of time. The foreign partner in any insurance company in India is not allowed to own more than 26% of the shares in Indian insurance company as per IRDA regulations. We have seen big financial groups in India like SBI, ICICI and HDFC enter this pace and become aggressive players. Other famous corporate groups like the Tatas, Birlas and the Ambanis have also formed insurance companies. The Government of India liberalised 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. Under the current guidelines, there is a 26 percent equity cap for foreign partners in an insurance company. There is a proposal to increase this limit to 49 percent. 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 15 life insurance companies have been registered. A host of private Insurance
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companies operating in life segments have started selling their insurance policies since 2001. Table shows the current market players in the life Insurance Industry (Source IRDA).

Life Insurance Market Growth

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 22 percent of the total 400 million of the insurable population. Most customers were underinsured with no flexibility or transparency in the products. With the entry of the private insurers the rules of the game have changed. Life insurance business in terms of first year premium has shown a growth of more than 95% over the previous year and non life, or general insurance, is not far behind either, growing at 22% during 2006-07.The 15 private insurers in the life insurance market have already grabbed nearly 24 percent of the market in terms of premium income. The new business premium of the 15 private players has tripled over last year. Meanwhile, state owned LIC's new premium business has fallen. Figure shows comparison between premiums being collected by private and public limited players in year 2006 and 2007.

30000 25002.45 25000 20000 15000 10000 5000 0 Premium Collected till march 2007 Premium Collected till march 2006 8716.94 5434.73 16285.51 20431.82 14997.09 Gross Premium in Rs. Crore Private Total Gross Premium in Rs. Crore Public Total Gross Premium in Rs. Crore Total

Figure -1

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 Future of The Industry

From as early as 1947 to 1972, this industry has gone through dynamic change. With the formation of the regulatory body, passing of the insurance act, and passing of various reforms, this insurance in India has become competitive and continues to attract interest from foreign countries. However, the recent economic recession has greatly affected this industry. Currently, there is a major credit crisis affecting the industry. A typical example is the collapse of US based AIG Company that has had ripple effects on to Indias TATA-AIG General Insurance Company. Bajaj Allianz, Prudential and ICICI companies have already closed some of their branches. any players have proposed the merging of the various companies in the sector to be able to caution themselves from the crunch. It is equally important to note that recession is not new to Indias economy. The country has been able to come out of one once and it can do so even now.

List of Life Insurance Companies While LIC has been around for a long time and is an extremely profit making venture, some of
the private players have just about started making profits on a year-on-year basis. It will take some time before most of them break even. The life insurance business has a long gestation period and it may take more than a decade to break even so all players would be ready for the same.

Sr. No. 1 2 3 4 5 6 7 8 9

Name of the Company Bajaj Allianz Life Insurance Co. Limited Birla Sun Life Insurance Co. Ltd HDFC Standard Life Insurance Co. Ltd ICICI Prudential Life Insurance Co. Ltd ING Vysya Life Insurance Co. Ltd. Life Insurance Corporation of India Max New York Life Insurance Co. Ltd Met Life India Insurance Co. Pvt. Ltd. Kotak Mahindra Old Mutual Life Insurance Ltd.
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10 11 12 13 14 15 16

SBI Life Insurance Co. Ltd. Tata AIG Life Insurance Co. Ltd. Reliance Life Insurance Co. Ltd. Aviva Life Insurance Co. India Pvt. Ltd. Sahara India Life Insurance Co. Ltd. Shriram Life Insurance Co. Ltd. Bharti AXA Life Insurance Co. Ltd.

Table -1 2.4. INSURANCE REGULATORY AND DEVELOPMENT AUTHORITY (IRDA)

2.4.1. INTRODUCTION
The Insurance Regulatory and Development Authority (IRDA) is a national agency of the Government of India, based in Hyderabad. It was formed by an act of Indian Parliament known as IRDA Act 1999, which was amended in 2002 to incorporate some emerging requirements. Mission of IRDA as stated in the act is "to protect the interests of the policyholders, to regulate, promote and ensure orderly growth of the insurance industry and for matters connected therewith or incidental thereto." In 2010, the Government of India ruled that the Unit Linked Insurance Plans (ULIPs) will be governed by IRDA, and not the market regulator Securities and Exchange Board of India.

2.4.2 DUTIES,POWERS AND FUNCTIONS OF IRDA

Section 14 of IRDA Act, 1999 lays down the duties, powers and functions of IRDA 1. Subject to the provisions of this Act and any other law for the time being in force, the Authority shall have the duty to regulate, promote and ensure orderly growth of the insurance business and re-insurance business. 2. Without prejudice to the generality of the provisions contained in sub-section (1), the powers and functions of the Authority shall include,

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1. issue to the applicant a certificate of registration, renew, modify, withdraw, suspend or cancel such registration; 2. protection of the interests of the policy holders in matters concerning assigning of policy, nomination by policy holders, insurable interest, settlement of insurance claim, surrender value of policy and other terms and conditions of contracts of insurance; 3. specifying requisite qualifications, code of conduct and practical training for intermediary or insurance intermediaries and agents; 4. specifying the code of conduct for surveyors and loss assessors; 5. promoting efficiency in the conduct of insurance business; 6. promoting and regulating professional organizations connected with the insurance and re-insurance business; 7. levying fees and other charges for carrying out the purposes of this Act; 8. calling for information from, undertaking inspection of, conducting enquiries and investigations including audit of the insurers, intermediaries, insurance intermediaries and other organizations connected with the insurance business; 9. control and regulation of the rates, advantages, terms and conditions that may be offered by insurers in respect of general insurance business not so controlled and regulated by the Tariff Advisory Committee under section 64U of the Insurance Act, 1938 (4 of 1938); 10. specifying the form and manner in which books of account shall be maintained and statement of accounts shall be rendered by insurers and other insurance intermediaries; 11. regulating investment of funds by insurance companies; 12. regulating maintenance of margin of solvency; 13. adjudication of disputes between insurers and intermediaries or insurance intermediaries; 14. supervising the functioning of the Tariff Advisory Committee; 15. specifying the percentage of premium income of the insurer to finance schemes for promoting and regulating professional organizations referred to in clause (f); 16. specifying the percentage of life insurance business and general insurance business to be undertaken by the insurer in the rural or social sector; and 17. exercising such other powers as may be prescribed from time to time,

2.4.3. IRDA GUIDELINES ON INSURANCE POLICIES

It is not unusual to see insurance-seekers as well as those who have bought policies to rely heavily on their insurance agents for advice and help regarding operational issues. Insurance companies, therefore, invest heavily in training and rewarding their agents. On the flipside, however, there are agents who sell insurance on a part-time basis and drop out when the situation turns unfavorable, leaving policyholders in the lurch. This is especially true in the current scenario, where reduced commissions have made many to abandon their job as insurance agents.
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The agents job does not stop at selling a policy to you and delivering the documents thereafter. They are required to help you further with paying renewing premiums, arranging to get changes (like those of address) effected, exercising the switch funds option, top-ups, partial withdrawals, policy surrender as also guiding your dependants with the claims process in the event of your demise.

If you happen to be one of those who have been left in the lurch by an agent, you need not be disheartened. Remember, your agent is just an intermediary between you and the company, and you can always go straight to your insurer to get any issue resolved. Besides, the Insurance Regulatory and Development Authority (( IRDA)) has put in place detailed guidelines for handling such orphan policies. If the agent closes shop, the insurance company is under obligation to assign an official or another agent to service the policy and offer help to such policyholders. Typically, insurers transfer the servicing of such orphaned policies to their in-house cells set up specifically for the purpose. The policyholder will not be affected much in such cases. The insurer informs them about the change, asking them to get in touch with the company directly if the need arises. Things could be a bit complicated if your agent happens to be your bank that acts as a banc assurance agency channel for your insurer. If the bank and the company decide to sever ties, the former may stop servicing your policy. Again, its the insurers responsibility to take charge of such policies and its call centre will become your point of contact. This apart, there could be a situation where you voluntarily wish to dissociate yourself from your agent due to poor quality of services. In such a case, you can bring this to the notice of your insurer who may decide to take over the servicing of the policy or assign the job to another agent. However, there is very little scope of you getting a new agent as companies usually do not accede to such requests.

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CHAPTER 3 LITERATURE REVIEW

3.1 Training and Development

3.1.1 Definition of Training:

The systematic development of the knowledge, skills and attitudes required by an individual to perform adequately a given task or job. Training refers to efforts that help enhance employee skills for carrying out the present job. According to Edwin B Flippo, training is the act of increasing knowledge and skills of an employee for doing a particular job. It is a learning process that involves the acquisition of knowledge, sharpening of skills, concepts, rules, or changing of attitudes and behaviors to enhance the performance of employees. Training is activity leading to skilled behavior.

Its not what you want in life, but its knowing how to reach it Its not where you want to go, but its knowing how to get there It may not be quite the outcome you were aiming for, but it will be an outcome Its not what you dream of doing, but its having the knowledge to do it It's not a set of goals, but its more like a vision
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Its not the goal you set, but its what you need to achieve it

Training is about knowing where you stand (no matter how good or bad the current situation looks) at present, and where you will be after some point of time.

Training is about the acquisition of knowledge, skills, and abilities (KSA) through professional development.

Training & Development need = Standard performance Actual performance.

3.1.2 OBJECTIVES OF TRAINING

The fundamental aim of training is to help the organization achieve its purpose by adding value to its key resource the people it employs. Training means investing in the people to enable them to perform better and to empower them to make the best use of their natural abilities. The particular objectives of training are to: Develop the competences of employees and improve their performance; Help people to grow within the organization in order that, as far as possible, its future needs for human resource can be met from within; Reduce the learning time for employees starting in new jobs on appointment, transfers or promotion, and ensure that they become fully competent as quickly and economically as possible.

3.1.3 IMPORTANCE OF TRAINING

To improve the current job performance of agents To familiarize agents with the policies and procedures of the organization. To enhance the creativity, adaptability and versatility of the employees and to facilitate learning at the work place To prepare agents for future job. To change the skills, knowledge and attitudes of the employees on a permanent basis.
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To help employees manage their careers. To maintain knowledgeable work force. To gain competitive advantage through a knowledgeable work force. To promote organizational growth through individual growth.

3.1.4 INPUTS IN TRAINING AND DEVELOPMENTS

Any training and development programme must contain inputs which enable the participants to gain skills, learn theoretical concepts and help acquire vision to look into distant future. In addition to these, there is a need to impart ethical orientation, emphasize on attitudinal changes and stress upon decision-making and problem-solving abilities.

Skills Training, as was stated earlier, is imparting skills to employees. A worker needs skills to operate machines, and use other equipments with least damage or scrap. This is a basic skill without which the operator will not be able to function. There is also the need for motor skills. Motor skills refer to performance of specific physical activities. These skills involve training to move various parts of ones body in response to certain external and internal stimuli. Common motor skills include walking, riding a bicycle, tying a shoelace, throwing a ball and driving a car. Motor skills are needed for all employees from the clerk to the general manager. Employees, particularly supervisors and executives, need interpersonal skills popular known as the people skills. Interpersonal skills are needed to understand one self and others better, and act accordingly. Examples of interpersonal skills include listening, persuading, and showing an understanding of others feelings.

Education The purpose of education is to teach theoretical concepts and develop a sense of reasoning and judgment. That any training and development programme must contain an element of education is well understood by HR specialist. Any such programme has university professors as resource persons to enlighten participants about theoretical knowledge of the topic proposed to be discussed. In fact organizations depute or encourage employees to do courses on a part time basis. Chief Executive Officers (CEOs) are known to attend refresher courses conducted by

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business schools. Education is important for managers and executives than for lower-cadre workers.

Development Another component of a training and development is development which is less skill oriented but stressed on knowledge. Knowledge about business environment, management principles and techniques, human relations, specific industry analysis and the like is useful for better management of the company.

Ethics There is need for imparting greater ethical orientation to a training and development programme. There is no denial of the fact that ethics are largely ignored in businesses. Unethical practices abound in marketing, finance and production function in an organization. They are less see and talked about in the personnel function. If the production, finance and marketing personnel indulge in unethical practices the fault rests on the HR manager. It is his/her duty to enlighten all the employees in the organization about the need of ethical behavior

3.1.5 THE BENEFITS OF EMPLOYEE TRAINING

How Training Benefits the Organization:

Leads to improved profitability and/or more positive attitudes towards profit orientation. Improves the job knowledge and skills at all levels of the organization Improves the morale of the workforce Helps people identify with organizational goals Helps create a better corporate image Fosters authenticity, openness and trust Improves relationship between boss and subordinate Aids in organizational development learns from the trainee Helps prepare guidelines for work
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Aids in understanding and carrying out organizational policies. Provides information for future needs in all areas of the organization Organization gets more effective decision-making and problem-solving skills Aids in development for promotion from within Aids in developing leadership skills, motivation, loyalty, better attitudes, and other aspects that successful workers and managers usually display Aids in increasing productivity and/or quality of work Helps keep costs down in many areas, e.g. production, personnel, administration, etc. Develops a sense of responsibility to the organization for being competent and knowledgeable Improves Labour-management relations Reduces outside consulting costs by utilizing competent internal consultation Stimulates preventive management as opposed to putting out fires Eliminates suboptimal behavior (such as hiding tools) Creates an appropriate climate for growth, communication Aids in improving organizational communication Helps employees adjust to change Aids in handling conflict, thereby helping to prevent stress and tension.

Benefits to the Individual Which in Turn Ultimately Should Benefit the Organization:

Helps the individual in making better decisions and effective problem solving Through training and development, motivational variables of recognition, achievement, growth, responsibility and advancement are internalized and operationalised Aids in encouraging and achieving self-development and self-confidence Helps a person handle stress, tension, frustration and conflict Provides information for improving leadership, knowledge, communication skills and attitudes Increases job satisfaction and recognition Moves a person towards personal goals while improving interactive skills Satisfies personal needs of the trainer (and trainee) Provides the trainee an avenue for growth and a say in his/her own future Develops a sense of growth in learning Helps a person develop speaking and listening skills; also writing skills when exercises are required. Helps eliminate fear in attempting new tasks

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Benefits in Personnel and Human Relations, Intra-group & Inter-group Relations and Policy Implementation:

Improves communication between groups and individuals: Aids in orientation for new employee and those taking new jobs through transfer or promotion Provides information on equal opportunity and affirmative action Provides information on other government laws and administrative policies Improves interpersonal skills. Makes organizational policies, rules and regulations viable. Improves morale Builds cohesiveness in groups Provides a good climate for learning, growth, and co-ordination Makes the organization a better place to work and live

3.1.6 METHODS AND TECHNIQUES OF TRAINING:

A multitude of methods of training are used to train employees. The most commonly used methods are shown in Table #2. Table #2 lists the various training methods and presents a summary of the most frequent uses to which these methods are put. As can be seen from Table #2, training methods are categorized into two groups-{I) on-the-job and (ii) off-the-job methods. On-the-job methods refer to methods that are applied in the workplace, while the employee is actually working. Off-the-job methods are used away from workplaces. Training techniques represent the medium of imparting skills and knowledge to employees. Obviously, training techniques are the means employed in the training methods. Among the most commonly used techniques are lectures, films, audio cassettes, case studies, role playing, videotapes and simulations. Table #3 presents the list of training techniques along with their ranking based on effectiveness. The higher the ranking (1 is the highest rank), the more effective the technique is.

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Training Methods and the Activities for which they are used Orienting New Employees, Special Introducing, Skills Innovations In Training Products & Services 1 A. On the Job Training Orientation Training Job instruction training Apprentice training Internships & Assistantship Job Rotation Coaching Y N N N N 2

Safety Education

Sales, Creative, Administrative, Technical & Supervisory & Professional Managerial Education Education

Y N

N Y

N Y

N Y

Y Y

B. Off the Job Methods Vestibule Lecture Special Study Films Televisions Y Y Y Y Y Y Y Y Y Y N Y Y Y Y N Y Y Y Y N Y Y Y Y

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Conference Discussion Case Study Role Playing Simulation Programmed Instructions Laboratory training

or

N N Y Y

N N Y Y

N N Y Y

N Y Y Y

Y N N 3

Table 2 NOTE: Y=Yes; N-No

At this point, it is worthwhile to elaborate on important techniques of training. We explain the following-lectures, audio-visuals, on-the-job training, programmed instruction, computer aided instruction, simulation and sensitivity training.

Lectures: Lecture is a verbal presentation of information by an instructor to a large audience. The lecturer is presumed to possess a considerable depth of knowledge of the subject at hand. A virtue of this method is that is can be used for very large groups, and hence the cost per trainee is low. This method is mainly used in colleges and universities, though its application is restricted in training factory employees. (See Table #3)

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The Relative Effectiveness of training Methods

Training Method

Knowledge Acquisition Rank

Changing Problem Interpersonal Participant Knowledge Attitudes Rank Solving Skills Skills Rank Acceptance retention Rank Rank

Case study Conference Lecture Films Programmed Instruction

2 3 9 4 1

4 3 8 6 7

1 4 9

4 3 8 6 7

2 1 8 5 7

2 5 8 7 1

Table 4 7
6

Table 3

Limitations of the7lecture method account for its low popularity. The 4method violates the Role Playing 2 3 2 4 principle of learning by practice. It constitutes a one-way communication. There is no feedback Sensitivity from the audience.. Continued lecturing is likely to bore the audience. To break the boredom, the lecturer often resorts to anecdotes, jokes and other 1 attention-getters. This activity may eventually Training 8 1 5 6 3 overshadow the real purpose of instruction. However, the lecture method can be made effective it Television 5 9 9 9 if is combined other methods of9training. 8
Lecture

Audio-visual: Visuals Audio-visuals include television slides, overheads, video-types and films. These can be used to provide a wide range of realistic examples of job conditions and situations in the condensed period of time. Further, the quality of the presentation can be controlled and will remain equal for all training group. But, audio-visuals constitute a one-way system of communication with no scope for the audience to raise doubts for clarification. Further, there is no flexibility of presentation from audience to audience.

On the job Training (OJT) Majority of industrial training is of the on-the-job-training type. OJT is conducted at the work site and in the context of the job. Often, it is informal, as when an experienced worker shows a trainee how to perform the job tasks.
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OJT has advantages. It is the most effective method as the trainee learns by experience, making him or her highly competent. Further, the method is least expensive since no formal training is organized. The trainee is highly motivated to learn he or she is aware of the fact that his or her success on the job depends on the training received. Finally, the training is free from an artificial situation of a classroom. This contributes to the effectiveness of the programme.

OJT suffers form certain demerits as well. The experienced employee may lack experience or inclination to train the juniors. The training programme itself is not systematically organized. In addition, a poorly conducted OJT programme is likely. to create safety hazards, result in damaged products or materials, and bring unnecessary stress to the trainees.

OJT is conducted at the work site and in the context of the job. It is, much time, informal. An experienced worker shows a trainee how to work on the job.

Programmed Instruction (PI) This is a method where training is offered without the intervention of a trainer. Information is provided to the trainee in blocks, either in a book of thought a teaching machine. After reading each block of material, the learner must answer a question about it. Feedback in the form of correct answers is provided after each response. Thus, programmed instruction (PI) involves:

1. 2. 3. 4.

Presenting questions, facts, or problems to the learner Allowing the person to respond Providing feedback on the accuracy of his or her answers If the answers are correct, the learner proceeds to the next block. If not, he or she repeats the same.

The main advantage of PI is that it is self-paced-trainees can progress through the programme at their own speed. Strong motivation is provided to the learner to repeat learning. Material is also structured and self-contained, offering much scope for practice.

The disadvantages are not to be ignored. The scope for learning is less, compared to other methods of training. Cost of preparing books, manuals and machinery is considerably high.
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Computer-Assisted Instruction (CAI) This is an extension of the PI method. The speed memory and data-manipulation capabilities of the computer permit greater utilization of basic PI concept. For example, the learner's response may determine the frequency and difficulty level of the next frame.

CAI is an improved system when compared to the PI method, in at least three respects. First, CAI provides for accountability as tests are taken on the computer so that the management can monitor each trainee's progress and needs. Second, a CAI training programme can also be modified easily to reflect technological innovations in the equipment for which the employee is being trained. Third, this training also tends to be more flexible in that trainees can usually use the computer almost any time they want, and thus get training when they prefer. Not to be ignored is the fact that from CAI is as rich and colorful as modem electronic games, complete with audio instruction displays. A deterrent with regard to CAI is its high cost, but repeated use may justify the cost.

Simulation: A simulator is any kind of equipment or technique that duplicates as nearly as possible the actual conditions encountered on the job. Simulation then, is an attempt to create a realistic decision-making environment for the trainee. Simulations present likely problem situation and alternatives to the trainee. For example, activities of an organization may be simulated and the trainee may be asked to make a decision in support to those activities. The results of those decisions are reported back to the trainee with an explanation of what would have happened had they actually made in the workplace. The trainee learns from this feedback and improves his/her subsequent simulation and workplace decisions. The more widely held simulation exercises are case study, role playing and vestibu1 training.

Case Study: is a written description of an actual situation in business which provokes, in the reader, the need to decide what is going on, what the situation really is or what the problems are, and what can and should be done. Taken from the actual experiences of organizations, these cases represent to describe, as accurately as possible, real problems that managers have faced. Trainee studies the cases to determine problems, analyses causes, develop alternative solutions, select the best one, and implement it. Case study can provide stimulating discussions among participants as well as excellent opportunities for individuals to defend their analytical and judgment abilities. It appears to be an ideal method to promote decision-making abilities within the constraints of limited data.
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Role playing: generally focuses on emotional (mainly human relations) issues rather than actual ones. The essence of role playing is to create a realistic situation, as in case study, and then have the trainee assume the parts of specific personalities in the situation. For example, a male worker may assume the role of a female supervisor, and the supervisor may assume the role of a male worker. Then, both may be given a typical work situation and asked to respond as they expect others to do. The consequences are a better understanding among individuals. Role playing helps promote interpersonal relation. Attitude change is another result of role playing. Case study and role playing are used in MDPs

Vestibule Training: utilizes equipment which closely resembles the actual ones used on the job. However, training takes place away from the work environment.

A special area or a room is set aside from the main production area and is equipped with furnishings similar to those found in the actual production area. The trainee is then permitted to learn under simulated conditions, without disrupting ongoing operations. A primary advantage of vestibule training it relieves the employee from the pressure of having to produce while learning. The emphasis is on learning skills required by the job. Of course, the cost of duplicate facilities and a special trainer is an obvious disadvantage.

The advantage of simulation is the opportunity to 'create an environment' similar to real situations the manager incurs, but without the high costs involved should the actions prove undesirable. The disadvantage is (i) it is difficult to duplicate the pressures and realities of actual decision-making non the job and (ii) individuals often act differently in real-life situations than they do in acting out a simulated exercise.

Sensitivity Training: Sensitivity training uses small numbers of trainees, usually fewer than 12 in a Group. They meet with a passive trainer and gain insight into their own and others' behavior. Meeting have no agenda, are held away from workplaces, and questions deal with the 'here and now' of the group process. Discussions focus on 'why participants behave as they do, how they perceive one another, and the feelings and emotions generated in the interaction process.

The objectives of sensitivity training are to provide the participants with increased awareness of their own behavior and how others perceive them-greater sensitivity to the behavior of others,
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and increased understanding of groups processes. Specific results sought include increased ability to empathize with other, improved listening skills, greater openness, increased tolerance of individual difference and increased conflict-resolution skills. The drawback of this method is that once the training is over, the participants are themselves again and they resort to their old habits.

3.1.7 TECHNIQUES OF TRAINING

Techniques of Training Technique Ice Breakers Leading Games Skill Games Communication Games Strategic planners Team building games Role reversal Doubling Tag Teams Mirroring Monodrama Shifting physical position Structured role playing Multiple role playing Built-in-tension Description Games to get team members know each other Exercise to each different styles of leadership Test to develop analytical skills Exercise to build bias free listening and talking Games to test ability to plan ahead Exercise requiring collaborative effort Exercise to teach plurality of view Bring out the ideas that are not often expressed One role played alternately by two participant Training with external perspective Insight into a given interaction highlighting of communication problems Role play with predetermined objective Providing a common focus of discussion Teaching the importance of resolving matter

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Shadowing Outward bound training 9 + 1 + 23 Lateral Thinking Morphological Analysis Gordon Technique Attribute Listening Cross-Cultural Training

Working under a senior to watch and learn Adventure sports for teams Self-assessment by a leader of leadership skills Thinking randomly to come up with new ideas Listing of alternative solution to problems Steering a discussion to crystallize solutions Isolation, selection and evaluation of a problem Programmes to tech specifics of varied cultures

Table 4

3.1.8 MEANING OF DEVELOPMENT

Development is a systematic process of learning and growth by which managerial personnel gain and knowledge, skill, and attitudes and insights to manage the work in their organization effectively and efficiently. It is an education process through which employees learn conceptual and theoretical knowledge and managerial skill in an organized manner .The main aim of Human Resource Development is to bring about an all round development of the people in the origination so the they can contribute their best to the origination , society and nation. Development is system and process involving organized series of learning activity designed to produce behavioral change in human beings in such a way that thy acquire desired level of competence for present and future role.

3.1.9 OBJECTIVE OF DEVELOPMENT

The main objective of development are as follows: 1. To provide a comprehensive framework for overall development of people in the organization .
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2. To develop the constructive mind and overall personality of each and every person in the organization .. 3. To develop the capabilities of each individual in relation to his present and expected future roles. 4. To develop and maintain high levels of motivation of employees. 5. To develop dyadic relationship between and his supervisor. 6. To develop the sense of team spirit, team work and inter team collaboration in the organization. 7. To develop the overall health and self renewing capabilities of the total organization. 8. To generate systematic information about human resources for the purposes of manpower planning, placement, succession planning and the like.

All the above mentioned objectives lead to the overall organizational effectiveness.

IMPORTANCE OF DEVELOPMENT
Improve performance of employees at all levels. Sustain good performance of employees. Entrain good performance of employees with the needed skills so as to meet the present needs of organization. Prevent obsolescence of employees by exposing them to latest concepts and techniques in their respective areas of specialization. To provide opportunities to fulfill their career aspiration.

3.1.10 THE TRAINING PROCESS

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 ESTABLISHIN G A NEEDS ANALYSIS

DEVELOPING TRAINING PROGRAMS AND MANUALS.

2 3
DELIVER THE TRAINING PROGRAM.

EVALUATE THE TRAINING PROGRAM.

Fig. 2

STEP 1: ESTABLISHING A NEEDS ANALYSIS. This step identifies activities to justify an investment for training. The techniques necessary for the data collection are surveys, observations, interviews, and customer comment cards. Several examples of an analysis outlining specific training needs are customer dissatisfaction, low morale, low productivity, and high turnover. The objective in establishing a needs analysis is to find out the answers to the following questions: - Why is training needed? - What type of training is needed? - When is the training needed? - Where is the training needed?
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- Who needs the training? and "Who" will conduct the training? - How will the training be performed? By determining training needs, an organization can decide what specific knowledge, skills, and attitudes are needed to improve the employees performance in accordance with the companys standards. The needs analysis is the starting point for all training. The primary objective of all training is to improve individual and organizational performance. Establishing a needs analysis is, and should always be the first step of the training process. STEP 2: DEVELOPING TRAINING PROGRAMS AND MANUALS. This step establishes the development of current job descriptions and standards and procedures. Job descriptions should be clear and concise and may serve as a major training tool for the identification of guidelines. Once the job description is completed, a complete list of standards and procedures should be established from each responsibility outlined in the job description. This will standardize the necessary guidelines for any future training. STEP 3: DELIVER THE TRAINING PROGRAM. This step is responsible for the instruction and delivery of the training program. Once you have designated your trainers, the training technique must be decided. One-on-one training, on-the-job training, group training, seminars, and workshops are the most popular methods. Before presenting a training session, make sure you have a thorough understanding of the following characteristics of an effective trainer. The trainer should have: - A desire to teach the subject being taught. - A working knowledge of the subject being taught. - An ability to motivate participants to want to learn. - A good sense of humor. - A dynamic appearance and good posture. - A strong passion for their topic. - A strong compassion towards their participants. - Appropriate audio/visual equipment to enhance the training session. For a training program to be successful, the trainer should be conscious of several essential elements, including a controlled environment, good planning, the use of various training methods, good communication skills, and trainee participation.

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STEP 4: EVALUATE THE TRAINING PROGRAM. This step will determine how effective and profitable your training program has been. Methods for evaluation are pre-and post- surveys of customer comments cards, the establishment of a cost/benefit analysis outlining your expenses and returns, and an increase in customer satisfaction and profits. The reason for an evaluation system is simple. The evaluation of training programs are without a doubt the most important step in the training process. It is this step that will indicate the effectiveness of both the training as well as the trainer.

DESIGNING TRAINING AND DEVELOPMENT PROGRAMME

Every training and development programme must address certain vital issues (1) who participate in the programme? (2) Who are the trainers? (3) What methods and techniques are to be used for training? (4) What should be the level of training? (5) What learning principles are needed? (6) Where is the programme conducted?

Who are the trainees?

Who are the trainers?

What methods and techniques?

What should be the level of training?

What principles of learning?

Where to conduct the programme

Steps in training Programme Fig 3

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3.2. COMPENSATION MANAGEMEMT 3.2.1 Meaning of compensation management

Compensation can be defined as all of the rewards earned by employees in return for their labour. Compensation is a tool used by management for a variety of purposes to further the existence of the company. Compensation may be adjusted according the business needs, goals, and available resources. Compensation is a systematic approach to providing monetary value to employees in exchange for work performed. Compensation may achieve several purposes assisting in recruitment, job performance, and job satisfaction. This includes:

Direct financial compensation consisting of pay received in the form of wages, salaries, bonuses and commissions provided at regular and consistent intervals Indirect financial compensation including all financial rewards that are not included in direct compensation and can be understood to form part of the social contract between the employer and employee such as benefits, leaves, retirement plans, education, and employee services Non-financial compensation referring to topics such as career development and advancement opportunities, opportunities for recognition, as well as work environment and conditions In determining effective rewards, however, the uniqueness of each employee must also be considered. People have different needs or reasons for working. The most appropriate compensation will meet these individual needs. To a large degree, adequate or fair compensation is in the mind of the employee.

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Table 5

3.2.2. OBJECTIVE OF COMPENSATION

Recruit and retain qualified employees. Increase or maintain morale/satisfaction. Reward and encourage peak performance. Achieve internal and external equity. Reduce turnover and encourage company loyalty. Modify (through negotiations) practices of unions.
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3.2.3. IMPORTANCE OF COMPENSATION

A fair compensation system is a must for every business organization. The fair compensation system will help in the following:

An ideal compensation system will have positive impact on the efficiency and results produced by employees. It will encourage the employees to perform better and achieve the standards fixed. It will enhance the process of job evaluation. It will also help in setting up an ideal job evaluation and the set standards would be more realistic and achievable. Such a system should be well defined and uniform. It will be apply to all the levels of the organization as a general system. The system should be simple and flexible so that every employee would be able to compute his own compensation receivable. It should be easy to implement, should not result in exploitation of workers. It will raise the morale, efficiency and cooperation among the workers. It, being just and fair would provide satisfaction to the workers. Such system would help management in complying with the various labor acts. Such system should also solve disputes between the employee union and management. The system should follow the management principle of equal pay. It should motivate and encouragement those who perform better and should provide opportunities for those who wish to excel. Sound Compensation/Reward System brings peace in the relationship of employer and employees. It aims at creating a healthy competition among them and encourages employees to work hard and efficiently. The system provides growth and advancement opportunities to the deserving employees. The perfect compensation system provides platform for happy and satisfied workforce. This minimizes the labour turnover. The organization enjoys the stability.

o o

o o o o

o o

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The organization is able to retain the best talent by providing them adequate compensation thereby stopping them from switching over to another job. The business organization can think of expansion and growth if it has the support of skillful, talented and happy workforce. The sound compensation system is hallmark of organizations success and prosperity. The success and stability of organization is measured with pay-package it provides to its employees.

3.3. ABOUT ORGANISATION

3.3.1. Company profile of MAX NEW YORK LIFE :

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MAX NEW YORK LIFE INSURANCE

Max New York Life wants people to view insurance as a financial protection and wealth creation instrument and not just a tax-saving tool.

One of the most admired private life insurance companies in India, Max New York Life Insurance Company Ltd. is a joint venture between New York Life, a Fortune 100 company and Max India Limited, one of India's leading multi-business corporations. The company has positioned itself on the quality platform. In line with its vision to be the most admired life insurance company in India, it has developed a strong corporate governance model based on the core values of excellence, honesty, knowledge, caring, integrity and teamwork. The strategy is to establish itself as a trusted life insurance specialist through a quality approach to business.

New York Life is a Fortune 100 company that has over 160 years of experience in the life insurance business. Max India Limited is a multi-business corporate dealing in Clinical Research, IT and Telecom Services, and Specialty Plastic Products businesses.

Max New York Life Insurance started its operations in India in 2000. It is the first life insurance company in India to be awarded the IS0 9001:2000 certification. Max New York offers
41

customized products tailored to suit individual's needs. With its various Products and Riders, there are more than 400 product combinations to choose from. Today, Max New York Life Insurance has a network of 57 offices spread over 37 cities all over India.

In line with its values of financial responsibility, Max New York Life has adopted prudent financial practices to ensure safety of policyholder's funds. The Company's paid up capital is Rs. 657 crore, which is more than the norm laid down by IRDA. Max New York Life invests significantly in its training program and each agent is trained for 152 hours as opposed to the mandatory 100 hours stipulated by the IRDA before beginning to sell in the marketplace. Training is a continuous process for agents at Max New York Life and ensures development of skills and knowledge through a structured program spread over 500 hours in two years. This focus on continuous quality training has resulted in the company having amongst the highest agent pass rate in IRDA examinations and the agents have the highest productivity among private life insurers.

It has established a wide agency distribution network with 172 offices and representatives across 120 cities in India. The company has established additional channel with 22 banc assurance relationships, corporate tie-ups and a strong Direct Sales Team. Through its wide network of highly competent life insurance agent advisors, flexible product solutions and strong customer focus, Max New York life is creating a partnership for life with its customers in India.

Max New York Life, one of Indias leading life insurance companies, expanded its presence in the southern region by opening its first general office in the city of Mysore. Max New York Life now has established a countrywide network of 172 offices and representatives across 120 cities in India.

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Max New York Life, which has till date sold over 1.53 million policies and recorded a sum assured of over Rs. 46,000 crore, has positioned itself on the quality platform. The company has developed a strong corporate governance model based on defined core values of caring, knowledge, excellence and honesty. Its strategy is to establish itself as a trusted life insurance specialist on the bedrock of quality of advice. The company has over 25,300 agent advisors, who are widely considered the best in the business.

Max New York Life aspires to be the "life insurance brand of first choice" amongst Indian consumers. To achieve this the company will draw on New York Life's demonstrated competence in developing and managing a superior personal sales network. For the last 46 years consecutively, the largest number of agents qualifying for membership to the Million Dollar Round Table (MDRT) have been from New York Life. The MDRT is the industry's most prestigious organization comprising the world's most successful insurance agents. Max New York Life, a merit oriented and equal opportunities employer, is looking for a few good men and women who will spearhead the effort to realize this vision.

Max New York Life wants people to view insurance as a financial protection and wealth creation instrument and not just a tax-saving tool. Since the launch of our operations, our focus has always been on providing risk protection and long-term wealth creation solutions to our customers. With a diverse product portfolio to meet customer requirements, it is evident that we are setting benchmarks in the marketplace and are well on course of realizing our vision to become Indias most admired Life Insurance Company.

An ever expanding presence of Max New York Life offices across India reinforces our commitment to serving the nation. We are extremely pleased with our progress in the region and feel that opening an office in Mysore would help us educate people about the true potential and benefits of life insurance. As life insurance specialists, Max New York Life will continue to help consumers make the right choices to meet their financial goals, both for the short and long-term,
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through sound quality advice offered by our agent advisors and a right mix of product offerings. he added.

Max New York Life has been instrumental in changing the paradigm of life insurance in India. It is the first life insurance company in India to introduce cause related marketing.

Children are at the very heart of Max New York Life's strategy. SOS Children's Villages of India is internationally recognized for its work in giving underprivileged children a wholesome life. The mission of SOS is "to help orphaned and abandoned children, by providing them with a family, a permanent home, education and strong foundation for an independent life." It's mission ties in with Max New York Life's philosophy of helping people secure the future of their near and dear ones.

Vision: Vision statement is "Most Admired Life Insurance Company in India". Mission: Become one of the top quartile life insurance companies in India Be a national player Be the brand of first choice Be the employer of choice Become principal of choice for agents

Max New York Life Values and Beliefs

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Excellence "In every aspect of work. Ranging from the in-house training institute to the detailed Personal Insurance Plan. Max New York Life is focused on achieving the highest standards of quality in every aspect of their business".

Honesty "Is the heart of the Life Insurance business. Max New York believes that above all, Life Insurance is based on trust. Transparency, Dependability and Integrity will form the cornerstones of the Max New York Life experience."

Knowledge "Is what makes experts. Max New York Life is focused on the Life Insurance business. Perfectly combining global expertise with local knowledge, Max New York Life is the Indian Life Insurance specialist."

Caring "For the customer. Max New York Life is redefining the Life Insurance paradigm to focus on the needs of the customers. The Max New York service process is responsive, personalized, humane and empathetic." Culture: Our "in house culture recipe" has some of the finest ingredients going into its making. Some of the more prominent aspects of our culture are stated below: Customer comes first Do it right the first time Bias for result oriented action Financial strength and discipline Clarity of purpose International quality standards Inclusive Meritocracy

45

Learning opportunities Fun at work Commitment to published value system

Achievements First life insurance Company in India to have IS0 9001:2000 certifications. Top five most respected private life insurance in India according to Business World survey. Continuous presence in Top 50 MDRT global list.

CSR(corporate social responsibility ) Max New York Life has been instrumental in changing the paradigm of life insurance in India. It is the first life insurance company in India to introduce cause related marketing. Children are at the very heart of Max New York Life's strategy. SOS Children's Villages of India is internationally recognized for its work in giving underprivileged children a wholesome life. The mission of SOS is "to help orphaned and abandoned children, by providing them with a family, a permanent home, education and strong foundation for an independent life." It's mission ties in with Max New York Life's philosophy of helping people secure the future of their near and dear ones. The company donates a part of the total money collected on all policies sold, to SOS Children's Villages of India at the end of the year.

Leadership Team

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Analjit Singh Chairman, Max India Limited Gary R. Bennett Managing Director and CEO,MNYL Anuroop Singh Vice Chairman,MNYL Joseph Gilmour President & CEO,New York International
Figure -4 Hierarchy of Max New York Life

PIM senior partner partner senior associate partner sales associate partner sales senior adm senior manager training manager agency associate agents/advisor

Figure 5

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Products Of Max Newyork Life Insurance:

Term Insurance Plan

Max New York Life Platinum Protect

Whole Life Plan Whole Life Participating Plan

Endowment Plans 20 year Endowment (Par) Plan Endowment to Age 60 (Par) Plan Life Gain Plus 20 Participating Plan Life Gain Plus 25 Participating Plan Life Gain Endowment Plan

Money Back Plan Child Plan Max New York Life Shiksha Plus II

Retirement Plans Life Partner Plus Immediate Annuity

Health Plans LifeLine Safety Net LifeLine MediCash Plus LifeLine Wellnes Plus LifeLine Healthy Family

Unit Linked Plans Max New York Life Fast Track Plan

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3.3.2 TRAINING IN MAX NEW YORK LIFE

The systematic development of the knowledge, skills and attitudes required by an individual to perform adequately a given task or job. Training refers to efforts that help enhance employee skills for carrying out the present job. According to Edwin B Flippo, training is the act of increasing knowledge and skills of an employee for doing a particular job.

Needs for training:

To improve the current job performance of agents To familiarize agents with the policies and procedures of the organization. To enhance the creativity, adaptability and versatility of the employees and to facilitate learning at the work place To prepare agents for future job. To change the skills, knowledge and attitudes of the employees on a permanent basis. To help employees manage their careers. To maintain knowledgeable work force. To gain competitive advantage through a knowledgeable work force. To promote organizational growth through individual growth.

Areas of training: Company policies and procedures Human relations training Skill based training Problem solving training

A Results-Oriented Training Program

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Team Leadership Workshop provides proven methods and procedures for successful people management. Participants receive a step-by-step plan for guiding each employee toward success.

This workshop includes elements of Frank Whyte's nationally respected Team Building Workshops expanding upon that foundation to help leaders: Recognize each employee's personality preferences and supervisory needs, Align their leadership style with those of their bosses, colleagues, and subordinates, Develop competent and committed employees by mentoring and guiding their employees toward success, Schedule their management responsibilities to ensure that nothing is left to chance, and Use practiced, real-world scenarios to resolve challenges and remove barriers.

TRAINING PROGRAM DONE BY MAX NEW YORK LIFE Training is must for every individual when he enters into the organization. Even though the candidate has experience he also should get training. Why because the organization culture, values and beliefs are different from one organization to other. Thats why the training program plays a key role in every organization.

Training program following by Max New York Life Insurance is different at various levels.

Mainly in training program the company concentrates on sales managers, agents, operations executives and telecallers.

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TRAINING PROGRAM FOR SALES MANAGERS:

The training program duration is 15 20 days They get training on product knowledge. Motivating and encouraging Advisors

TRAINING PROGRAM FOR ADVISORS:

The training program duration is 15 20 days They get training on product knowledge How to convince the people. Objection Handling

TRAINING PROGRAM FOR OPERATIONS EXECUTIVES:

They will get training on customer database files Taking care of the customer files Well trained in product information and documentation Renewals will be informed periodically.

REQUIRED SKILLS FOR EMPLOYEES IN MAX NEW YORK LIFE INSURANCE:

Interpersonal skills Excellent communication skills Understanding nature Aggressiveness

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Convincing skills Ability to motivate others Interest to learn

Analysis of office staff who are having sufficient Knowledge on life Insurance .

PROFESSION

LEVEL OF PRODUCT KNOWLEDGE

NEW ADVISORS Advisors Telecallers Marketing Executives

8% 56% 12% 24%

Table 6 Diagram of the table

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HAVING THE SUFFICIENT PRODUCT KNOWLEDGE ON INSURENCE

Advisors Telecallers Marketing Executives New Advisors

Analysis of the chart:

The above chart showing that advisors only have more knowledge than telecallers, marketing executives and new advisors. Advisors will complete the deals. But after that every thing will take care by operations executives and telecallers. With out sufficient knowledge these both people cant work well. When the telecaller is calling to customer for renewal premium that person should have a knowledge how the premium should calculate, and they should know any extra charges for late payment, and how much grace period will be these things should know even telecallers and operations executives too.

MAX NEW YORK LIFE TRAINING CHART

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Pre-licensing 7 days

Post-licensing 8 days FCS

FCS= fundamental career school 2 Full day 6 half day + full day Filed call

Analysis of chart This chart shows the duration of training program conducted by the company, in this 15 days duration company provide seven days BCS and eight days FCS training to the agents ,first seven days training is Pre-licensing training, after this training conduct IC- 33 exam and agents has mandatory to pass this exam for the next eight days training.

PRE-LICENSING =IC -33 (IRDA course)

IC -33 is a exam conducted by Insurance Institute of India conducts every year an all India based competitive exam for recruitment of Insurance agents and is known by the name of IRDA exam or Insurance Regulatory and Development Authority exam. The basic requirement to sit for the exam is that he or she must have cleared his class 12th from a recognized university or board. As regards the pattern of question is concerned, theme always remains the same, as in all the questions would be related to the Insurance, loans, regulations and their general application. Moreover, you can also expect some numerical problems as well. However, they wont be
54

rocket science, so you do not have to worry. They would be like normal percentage, discount and loan calculation

FANDAMENTAL CAREER SCHOOL (FCS) We start FCS classes when candidate pass the IC-33 IRDA exam. TRAINING ROOM ACTIVITY FCS- Day 1 and 2
Learn -: Overview of sales process :overview of product

Practice : Trainer demonstration Role plays call-a-thon book appointment

Implement : Agents need observe and learn the script to start practice from Day 3 Onwards.

FCS- Day 3 to 8
Learn will start the day with cal-la-thon. Role play or an activity to practice steps sales process. Product and process.

Practice Demo by trainee Practice( call-a-thon, role play)

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Implement participate in the activities Book appointment Take reference

Let us explain one by one :FCS Day 1 Training Room Activity . OH presentation Role play approach talk .Referral and natural market objection handling ,3 Ps, ASF.

FCS Day 2 Role play on Day 1 activity Integrated Role play ( 3Ps + ASF + SOL) Role play presenting sol FCS Day 3 Eligibility for entry to FCS every day completed SOL sheet. Role play on Day 2 tech.

ADM (Agency Development Manager) Activity. Explain white book (P 200 to P 40 to P7). Demo appointment booking.

FCS Day 4 Role play in Day 3 tech .

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Telephone clinic . OH address the participants. ADM Activity Facilitate field work. FCS Day 5

Feedback of filed work day 4. Role play approach + objection handling. MNYL launch videos. FCS Day 6 Feedback of field work Day 5. Role play sol + presenting.

FCS Day 7 Feedback of fieldwork Day 6 OH reviews FODs progress in the batch role plays closing.

FCS Day 8 ( FCS Day 8 is a big day) Insurance reinforce the belief in LI Recall usage of which book and BMS agent work habits . plain your year book agent and compensation identify their goals- goal setting.

FCS Day 4 -8 (Second half) Your agents is ready to market sales call independently because he has learned the sales process , ADM has helper him in making P 40 and P 7 .

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BASIC CARRER SCHOOL(BCS) -2 OF 2

OBJECTIVE1. Focus is on building conviction for selling the right product. 2. Sales process sessions are integrated as clinic sessions. SESSION 1 life partner plus +riders 2 whole life par+ OPBB+ illustrations practice. 3 - Agent compensation and Maximizing earning. 4 Prospecting thought referred leads. 5 Approaching your market + Telephone clinic. 6 Activity Standards 10-7-2, preparing for sales call(including time management). 7 Need identification- fact finder. 8 closing skills and techniques. 9 objection handling clinic. 10 Creating a marketing plan (including goal setting)+ BMS. 11 Fact finding clinic. 12 customer behavior.

BASIC CAREER SCHOOL (BCS) 2 OF 2. OBJECTIVE1. Focus is on building conviction for selling the right product. 2. Knowledge and skill sessions are integrated.

SESSION 13. Platinum product life partner plus illustrations.

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14. Riders. 15. Designing the solution. 16. presenting the solution. 17. financial Basics (including, PIW +Fund performance)+ Basics of UL products. 18. shiksha plus 11 + college plan. 19. flexi. Fortune + shudh invest. 20. combo selling- T.rad +ULIPs( including illustration) 21. Implementing the sale and policy Delivery. 22.Ethics in selling. 23.Prospecting ( R 600)+ Approach. 24. Managing your portfolio ( persistency).

INTERMEDIAT CAREER SCHOOL (ICS) The duration of this classes are 13 months to 24 months . In this class trainer provide training to handle current objection and provide information about new policies and company goal.

3.3.3 COMPENSATION MANAGEMENT AT AGENT LEVEL

II Agent Fast Start Incentive At The End of Month 3

9 in 90 bonus in M0 to M3 Criteria Payout ( in Rs)

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9 Case and 20,000 FYC 9 Case and 30,000 FYC

10,000 15,000

Table 7 NOTE- Month of joining is month 0 II .Training Program Reimbursement for 4 -24 months 1. Rs 1250 as Training Program Reimbursement per training class. 2. Rs 500 as Artier Allowance per training class Maximum of 4 training class in a month QUALIFYING CRITERIA 1. Production requirement: Month 1-12: Rs.5000 FCS earning in the month OR average p.m.( on a YTD bases) Month 13-24: Rs earning in the month OR average p.m.(on a YTD bases)

2.Input requirement: Agent need to register 15 New sales call every month (in 1-24 months) on activator to become eligible for TPR. Note: 1.special support of training Program Reimbursement at ore allowance to get triggered from month 4. 2.Applicable for agents joined on or after 1st July2009. 3. If YTD tenure of an agents falls partly under M1-12 AND M13-24slab, than Total Production Requirements for respective slabs (based on number of months spent in each slab). III. Agent case rate bonus (payable quarterly)

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Not only more cases generate more commission they generate more referrals which provide more roads of opportunity. We further enhance those commission with Quarterly Case Rate Bonuses. Consistent activity is the key to maintaining a successful career so we reward with a case activity multiplier. Another example of how we pay you to win. Quarterly Case Rate Bonus Paid Cases 9 12 18 FYC 30,000 40,000 50,000 Bonus per case 350 400 500

Case Activity Multiplier 3 months 2 months 2 times 1.5 times

Table 8 NOTE: CEIP Paid cases and FYC is not included. Case Activity =MTD Case Activity. Case Rate Bonus to get triggered from month 4 onwards

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IV. Agent Performance Linked Bonus (for Agent in 25+months) (payable quarterly)
The higher you go and longer you drive ,the rewards continue to improve. But persistently staying on the right path is important. It can multiply your earnings or send you back down the road.

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Commission on the basis of Z card

Figure 4

63

64

MODULE THREE-Agent compensation and Maximizing Earning

PRIORITY FYC SLAB 15000 - 22500 22501 -30000 30001 - 45000 45001 - 75000 75001 150000 1550001 250000 250001 - 375000 376001 + 26% 30% 28% 32% 30% 34% 32% 36% 25 - 36m 12% 14% 16% 18% 20% 22% 37 - 48m 14% 16% 18% 20% 22% 24% 49 - 50m 16% 18% 20% 22% 24% 26% 61m+ 18% 20% 22% 24% 26% 28%

Table 9

PREMIER FYC slab 15000 -22500 22501 -30000 30001 -45000 45001 -75000 75001 -150000 26 -36m 13% 16% 19% 22% 25% 37- 48m 15% 18% 21% 24% 27% 49 -60m 17% 20% 23% 26% 29% 61m * 19% 22% 25% 28% 31%
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150001 -250000 250001 -375000 375001 +

28% 32% 36%

30% 34% 38%

29% 32% 40%

34% 38% 42%

Table 10

PLATINUM FYC Slab 15000 - 22500 22501 - 30000 30001 - 45000 45001 -75000 75001 - 150000 150001 - 250000 250001 - 375000 375001 + 26 - 36 m 17% 20% 23% 26% 29% 32% 38% 44% 37 -48 m 19% 22% 25% 28% 31% 34% 40% 46% 49 60m 21% 24% 24% 30% 33% 36% 42% 48% 61 m + 23% 26% 26% 32% 35% 38% 44% 50%

Table 11 13th month persistency Multiplier 75% 0.8 75.1-85% 1.0 85.1% 1.1

v. Agent Referral Fee ( Payable Monthly)

ARF- Payable Monthly (up to Month 12 of the referral agent)

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5% of FYC is paid as ARE on referred Agent becoming YTD Proactive. FYC Proactive target 0- 12 m Rs 5000 p.m on a YTD basis.

Some scenarios for understanding compensation

CASE STUDY 1: Ramesh joined MNYL in the month of Jan 2011 and logged 10 cases with MFYP of Rs 1,00,000 till April 2011. He earned his commission @ 20% . calculate his total earnings including Agent Fast Start Incentive. Solution: Commission earned on Rs 1,00,000 MFYP @20% = Rs 20,000 AFSI for commission earned up to Rs 20,000 with 9 cases = Rs10,000 Total earned money by Ramesh = Rs 30,000. CASE STUDY 2 : Sunil has been AN Agent with MLYL since Aug 2010. He is religiously following the MNYL recommendation Work habits and is a very successful agent. He logged 8 Application in the month of Jan 10 Application in Feb and only 1 App in March due to bad health. Total FYC earned by Sunil is Rs 56000 in the J - F - M quarter. Calculate Case Rate Bonus for Quarter 1 earned by him. Solution: Total Apps Logged by Sunil in quarter 1 =10 8 1= 19 Case rate Bonus slab qualified for = Apps Rs 500 per case. Case Activity multiplier = 2* Rs 500 per case = Rs. 1000 per case. Total Amount earned by Sunil a Case bonus in Quarter 1 =19* 1000 = Rs. 19000

REWARDS BASED ON THE PERFORMANCE:

1) Premium Leader 67

Qualifying Criteria- Rs. 1 Lakh AFYP in a month Reward and Recognition- Mention in leaders Report, Lunch 2) Ten-A-Monther Qualifying Criteria-10 applications in a month and Rs. 30,000 AFYP Reward and Recognition- MNYL Crystal Glass, mention in Leaders Report, Lunch. 3) Hi-Flier Qualifying Criteria- 20 applications in a month Reward and Recognition- MNYL Silver Medal, MNYL Crystal Glass, Mention in leaders Report, Lunch

4) Career Success Award Qualifying Criteria-15 paid cases & Rs. 40,000 FYC at the end of month 3 Reward and Recognition- Recognition Award 5) Career Producer Award Qualifying Criteria- 25 paid cases & Rs. 80,000 FYC at the end of month 6 Reward and Recognition- Recognition Award

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C E MDRT

Ex. Council
Paul Colgan Trophy Centurion

Agent of the Year Paid Cases, FYC, Persistency, Rider, Referral and CEIP Leader Career Foundation Club

Career Producer Award

Career Success Award

Hi-Flier

Ten-A-Monther

Premium Leader

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6) Career Foundation Club Qualifying Criteria- 50 paid cases & Rs. 1.8 lakhs FYC in July- June for Recruits during this period.Reward and Recognition- Attend CFC meeting to be held at Zone level 7) Paid Case, FYC, Persistency, rider, Referral and CEIP Leader Qualifying CriteriaTop Agent in each category in each GO

Reward and Recognition- Recognition Plaque 8) Agent of the Year Qualifying Criteria-Highest Points in each GO Reward and Recognition- Recognition Award

9) Centurion Qualifying Criteria- 100 net paid cases in a year Reward and Recognition- Centurion Trophy 10) Paul Colgan Trophy Qualifying Criteria- Highest FYC with 100 or more paid cases and 95% Or more 13th month persistency Reward and Recognition- Recognition Trophy

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CHAPTER - 4 RESEARCH METHODOLOGY

4.1 . INTRODUCTION
The following research project is a study conducted at Max New York Life Insurance to study the training and development programs being conducted presently ,and compensation management at the agent level . It aims at studying the process involved and to evaluate the effectiveness of these training sessions in terms of the training course modules and the trainers conducting the sessions , and study the compensation management criteria . The Research would conclude by critically analysing the sessions and giving suitable recommendation to improve the programs.

4.2. TYPE OF RESEARCH DESIGN

The study undertaken is strictly descriptive and both qualitative and quantitative in nature; as a result of the requirement of the study to be secondary in nature, hence it is descriptive in nature.

4.3. STUDY MEHTODOLOGY

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 This study initiated by understanding the meaning of Training and Development ,its objective ,advantages, importance, its role in the HRM and its role in the Insurance sector as this study is based on Insurance sector only.

4.4. DATA COLLECTION

This research is confined to secondary and primary data both. For this research data has been collected from the help of industry mentor, training manager of company , by the discussion among the friends , interviews ,office record internet, and books etc.

4.5. SAMPALING TECHNIQUE :

Initially, The list suitable profiles was prepared keeping in mind the objective of the research. Thus my sampling came out to be convenient. The sources of information are both primary & secondary.

4.5. ANALYSIS AND PRESENTATION OF DATA

In this study the data has been presented in the form of paragraphs and by means of figures and a few graphs.

4.5. LIMITATIONS

72

1. conducting the research time constraint created the barriers. Also,the data collection method was not secondary only. 2. The survey was conducted with in the company. 3.And in survey I have to interact with the employees. But the employees will be busy their works.

4. Getting the good response from the employee will be difficult because of their busy schedule.

5. Time to interact with employees inside the branch is not sufficient.

CHAPTER -5
73

FINDINGS

Trained employees can work more efficiently.

Training makes employees more loyal to an organization.

Training makes an employee more useful to a firm.

Training enables employees to secure promotions easily. They can realize their career goals comfortably.

Employees can avoid mistakes on the job. They can handle jobs with confidence. They will be more satisfied on their jobs.

Training can contribute to higher production and fewer mistakes, greater job satisfaction and lower employee turnover. Also, it can enable employees to cope up with organizational, social and technological change.

Commission based compensation motivate the agents to give their best.

CHAPTER -6

74

RECOMMENDATIONS

Create awareness: The Company has to take care of awareness creation about the products and services among the Advisors/Agents

Charges: The Company has to reduce the mortality and administration charges.

The company has to give periodic training.

Product promotion strategies should be improved.

Company should consider the present competition and should act according to the customer needs.

It Should be like long term training like Fundamental Carrier class , Basic Carrier class which helps the advisors in different stages.

CHAPTER 7
75

CONCLUSION

In this Knowledge-based economy, training helps people to learn how to do the things
differently or to the different things. Products are now increasingly knowledge-intensive; for this employers are responsible for providing opportunities for continued learning. To cope with the challenges and competitiveness in the world, every organization needs the services of trained persons for performing the activities in the systemic way. So, training program plays a key role in individual as well as organizational performance. And in insurance sector training is very important because insurance agent is also a financial adviser ,if they are not trained or updated, they miss guide the innocent people.

REFERENCES
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WEBSITE www.cityHR.com www.maxnewyorklife.com

BOOKS

By catalogues of Max New York Life

Lynton, R.P. and Pareek, U. Training for development, 2nd Ed., New Delhi: Vistaar publication, 2002. Bhatnagar, O.P. Evaluation methodology for training, New Delhi: Oxford and IBH publishing co.pvt.ltd. Rae, L. The art of training and development, effective planning. Vol. 1, New Delhi. Tannenbaum, S. A strategic view of organizational training and learning. A hand book of human resource management practice, 8th ed., 2001. Personnel management, Mc. Graw Hill, 6th ed., 1981.

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PARAMITER NAME OF THE AGENT Ashok GUPTA Mohan lal Sandeep puspa singh manju goel yogesh srivastave Manoj Rai Anuj gupta Priyanshu fakir mohan Mahesh panday sidharth tyagi Monika seth Neha pal susma yadav rohit panday Pankaj R.K singh Susmita mishra Suraj singh vijay yadav Manoj tiwari SURYA GUPTA MEGHNA UPADHYAY NITA MEHTA SWAR LEKHA NANCY JEETENDER RADHA

EDUCATION QUALIFICATION MARRIED

PRIM WORK EX

5 YEARS STAY IN A CITY

BEFORE TRAINING

AFTER TRAINING

G G UG G G H G G UG PG G H H G G G H H G G G PG PG G G G G G G 5 12 14 12 23 7 8 15 4 6

8 7 18 14 16 20 13 24 18 12 7 8

6 12 17 18 19 23 20

78

KRISHNA UMESH PANT JYOTISH LAL MAHESH KUMAR PARASHER JYOTISH MANOJ SHUKLA JAGRITI SINGH MANAV SHRIDHAR ANNU SUDHIR MISHRA RUDRA BHALLA SAVITA KUNDU MANSI GOEL CHAVI GUPTA PUNEET YADAV AMIT VASAN AYUSH BHATNAGAR SHIVAM ATREYA SONAM RATHI Ritu raj singh

G G G G PG G G G G G G G G H G G G PG PG

21 31 21 12 15 16 17 19 21 12 15 17 18 15 13 15 14 12 18

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120% 100% 80% 60% 40% 20% 0% Series1

80