1

Human Resource Management

You often see phrases like these in the annual reports of

major businesses:

“Our people are our greatest asset”

“Nothing is more important than our

employees”

2

Effective human resource management has become more

important in recent times.  Here are some reasons why:

Most businesses now provide services rather than

produce goods – people are the critical resource in the

quality and customer service level of any service

business

Competitiveness requires a business to be efficient and

productive – this is difficult unless the workforce is

well motivated, has the right skills and is effectively

organized

The move towards fewer layers of management

hierarchy (flatter organizational structures) has placed

greater emphasis on delegation and communication

As a result, if a business is to be successful and achieve its

objectives, then it needs to manage its human resources

effectively. So step forward “human resource management”!

3

Human resource management is usually shortened to

“HRM”.  It is defined by the CIPD as:

“The design, implementation and

maintenance of strategies to

manage people for optimum

business performance”

In other words, HRM is about how people are managed by a

business in order to meet the strategic objectives of the

business.  The functional objectives set for HRM need to be

consistent with the corporate objectives.

Human Resource Management is the core function of all

organizations. It ensures that companies have the necessary

talent required to operate effectively. It manages the

recruitment and selection of new employees as well as the

training and development of new and current employees.

Additionally, it establishes and administers compensation

plans and employee benefit programs.

4

HRM is the organizational function that deals with issues

related to people such as compensation, hiring, performance

management, organization development, safety, wellness,

benefits, employee motivation, communication,

administration, and training.

HRM is also a strategic and comprehensive approach to

managing people and the workplace culture and environment.

Effective HRM enables employees to contribute effectively

and productively to the overall company direction and the

accomplishment of the organization's goals and objectives.

HRM is moving away from traditional personnel,

administration, and transactional roles, which are

increasingly outsourced.

HRM is now expected to add value to the strategic utilization

of employees and that employee programs impact the

business in measurable ways. The new role of HRM involves

strategic direction and HRM metrics and measurements to

demonstrate value.

5

From the smallest to the largest organization, it is vital that

the human resources be managed effectively for the

organization to prosper and survive. If these human resources

are neglected or mismanaged, the organization is unlikely to

do well and may even fail.

Hence Human resource management (HRM) has gained

increasing importance and is today viewed as a fundamental

aspect of management. Human resource management has

become task number one for many organizations.

6

Four Fundamental principles of HRM

Human resources are the most important assets an

organization has and their effective management is the key to

its success.

Organizational success is most likely to be achieved if the

personal policies and procedures are closely linked to

corporate objectives and strategic plans.

Organizational culture, values and climate

significantly influence managerial behavior and exert a major

influence on the achievement of excellence.

Human resource management is concerned with integration-

getting all members of the organization involved and

working together with a sense of common purpose.

7

TOOLS OF HUMAN RESOURCE

MANAGEMENT

The key is to remember that HRM is a strategic approach. 

HRM uses a variety of tools to help meet the strategic needs

of the business, each of which needs together in an integrated

way.  The key tools are:

Workforce planning

8

Recruitment & selection

Training & development

9

Rewarding and motivating staff

10

Communication

Roles and responsibilities (organizational structures)

11

12Emergence of insurance sector

There are three era’s which has passed till the 21st century.

Colonial Era

Nationalization

Liberalization

13

Colonial Era

In the colonial era the 1st insurance company was established

in the year 1850. The company is named by “The Insurance

Office” In 1667 Nicholas Barbon was instrumental in

forming the first actual insurance company. It was known as

"The Insurance Office".

So, what happened to the first insurance company, The

Insurance Office? Well, nobody is exactly sure, but it

eventually went out of business. The oldest documented

insurance company today dates back to 1710. Originally

known as the Sun Fire Office, it started not all that long after

the original Fire Office, and probably while the first was still

in business. The Sun Fire Office, through many mergers and

acquisitions, is today known as Royal & SunAlliance,

Britain's largest insurance company. It was observed that

there must be some rules and regulations to be implemented

so to avoid the everyone’s choice of plan. So for the smooth

and disciplinary functioning The Insurance Act was

implemented in the year 1938.

14

Nationalization

Nationalization (British English spelling nationalization) is

the process of taking a private industry or private assets into

public ownership by a national government or state.

Nationalization usually refers to private assets, but may also

mean assets owned by lower levels of government, such as

municipalities, being transferred to the public sector to be

operated and owned by the state. The opposite of

nationalization is usually privatization or de-nationalization,

but may also be municipalization. Industries that are usually

subject nationalization include transport, communications,

energy, banking and natural resources though there are other

areas and there have even been calls for the nationalization of

the legal service.

A renationalization occurs when state-owned assets are

privatized and later nationalized again, often when a different

political party or faction is in power. Nationalization has

been used to refer to either direct state-ownership or

management of an enterprise or to a government acquiring a

large controlling share of a nominally private, publicly listed

corporation.

15

Liberalization

The world has become a global village. The Liberalisation,

Privatization and Globalisation (LPG) wave has sweeped

across the global economies. The two pillars of India's

economic policy before 1991 have been protection and public

sector.

Thus the New Economic Policy 1991 was a departure from

the regulated planned economic tradition to that of LPG

movement. After nearly a decade of intense debate a

consensus developed in India for ending the public sector

monopoly in insurance and opens the industry to private

sector participants subject to suitable prudential regulation.

Today, to the credit of combined efforts of both the regulator

and industry players, benefits of insurance are widely

acknowledged, public confidence in the industry has been

very much restored and the industry has become more

dynamic. Following the recent reform in the insurance sector,

Indian insurance industry is moving ahead.

The main element in the reform process was the opening up

of the insurance industry in 2000 with foreign direct

16investment permitted up to 26 per cent of equity. With this

change global insurers have rushed into the country to

capture the market. The reforms have two objectives.

One to capture  a vast untapped population under suitable

insurance cover. The second, to create a more efficient and

competitive insurance industry and elevate the performance

of insurance companies.

The Insurance Regulatory and Development Authority

(IRDA) since its incorporation as a statutory body in April

2000 has regulated the opening of insurance sector which has

seen  15 life and 23 non life private companies launch their

operations in India In the post liberalization phase, insurance

industry has witnessed beneficial effects of competition.

The market for pension product is developing and there is a

unit linked insurance plan generated by private players.

Opening of the insurance market to private and foreign

players and a conversion of a monopolistic market to a

liberalized one has transformed the insurance industry in

India.

Best international practices in service and operational

efficiency through use of latest technologies, need based

17schemes etc. are available to customer. The credit for

enlarging the insurance sector goes to both the public and

private sector.

While the private sector has come up with aggressive

marketing strategy to establish their presence, the public

sector has in turn redrawn its priorities and revamped their

marketing strategies to reach out to greater mass of people It

is in this backdrop of liberalisation of insurance sector the

paper has analysed the new dimensions post liberalisation

like raising of foreign direct limit, micro insurance in rural

market, bancassurance, reinsurance and alternate risk transfer

(ATR).

18History of insurance

In some sense we can say that insurance

appearssimultaneously with the appearance of human society.

We know of two types of economies in human societies:

natural or non-monetary economies (using barter and trade

with no centralized nor standardized set of financial

instruments) and more modern monetary economies (with

markets, currency, financial instruments and so on). The

former is more primitive and the insurance in such economies

entails agreements of mutual aid. If one family's house is

destroyed the neighbours are committed to help rebuild.

Granaries housed another primitive form of insurance to

indemnify against famines. Often informal or formally

intrinsic to local religious customs, this type of insurance has

survived to the present day in some countries where a

modern money economy with its financial instruments is not

widespread.Turning to insurance in the modern sense (i.e.,

insurance in a modern money economy, in which insurance is

part of the financial sphere), early methods of transferring or

19distributing risk were practiced by Chinese and Babylonian

traders as long ago as the 3rd and 2nd millennia BC,

respectively. Chinese merchants travelling treacherous river

rapids would redistribute their wares across many vessels to

limit the loss due to any single vessel's capsizing. The

Babylonians developed a system which was recorded in the

famous Code of Hammurabi, c. 1750 BC, and practiced by

early Mediterranean sailing merchants. If a merchant

received a loan to fund his shipment, he would pay the lender

an additional sum in exchange for the lender's guarantee to

cancel the loan should the shipment be stolen or lost at sea.

Achaemenian monarchs of Ancient Persia were the first to

insure their people and made it official by registering the

insuring process in governmental notary offices. The

insurance tradition was performed each year in Norouz

(beginning of the Iranian New Year); the heads of different

ethnic groups as well as others willing to take part, presented

gifts to the monarch. The most important gift was presented

during a special ceremony. When a gift was worth more than

10,000 Derrik (Achaemenian gold coin) the issue was

registered in a special office. This was advantageous to those

who presented such special gifts. For others, the presents

were fairly assessed by the confidants of the court. Then the

20assessment was registered in special offices.The purpose of

registering was that whenever the person who presented the

gift registered by the court was in trouble, the monarch and

the court would help him. Jahez, a historian and writer, writes

in one of his books on ancient Iran: "[W]henever the owner

of the present is in trouble or wants to construct a building,

set up a feast, have his children married, etc. the one in

charge of this in the court would check the registration. If the

registered amount exceeded 10,000 Derrik, he or she would

receive an amount of twice as much."

A thousand years later, the inhabitants of Rhodes invented

the concept of the general average. Merchants whose goods

were being shipped together would pay a proportionally

divided premium which would be used to reimburse any

merchant whose goods were deliberately jettisoned in order

to lighten the ship and save it from total loss.

The ancient Athenian "maritime loan" advanced money for

voyages with repayment being cancelled if the ship was lost.

In the 4th century BC, rates for the loans differed according

to safe or dangerous times of year, implying an intuitive

pricing of risk with an effect similar to insurance. The Greeks

and Romans introduced the origins of health and life

21insurance c. 600 BCE when they created guilds called

"benevolent societies" which cared for the families of

deceased members, as well as paying funeral expenses of

members. Guilds in the Middle Ages served a similar

purpose. The Talmud deals with several aspects of insuring

goods. Before insurance was established in the late 17th

century, "friendly societies" existed in England, in which

people donated amounts of money to a general sum that

could be used for emergencies.

Separate insurance contracts (i.e., insurance policies not

bundled with loans or other kinds of contracts) were invented

in Genoa in the 14th century, as were insurance pools backed

by pledges of landed estates.

Some forms of insurance had developed in London by the

early decades of the 17th century. For example, the will of

the English colonist Robert Hayman mentions two "policies

of insurance" taken out with the diocesan Chancellor of

London, Arthur Duck. Of the value of £100 each, one relates

to the safe arrival of Hayman's ship in Guyana and the other

is in regard to "one hundred pounds assured by the said

Doctor Arthur Ducke on my life". Hayman's will was signed

and sealed on 17 November 1628 but not proved until 1633.

22Toward the end of the seventeenth century, London's

growing importance as a centre for trade increased demand

for marine insurance. In the late 1680s, Edward Lloyd

opened a coffee house that became a popular haunt of ship

owners, merchants, and ships' captains, and thereby a reliable

source of the latest shipping news. It became the meeting

place for parties wishing to insure cargoes and ships, and

those willing to underwrite such ventures. Today, Lloyd's of

London remains the leading market (note that it is an

insurance market rather than a company) for marine and

other specialist types of insurance, but it operates rather

differently than the more familiar kinds of insurance.

The first insurance company in the United States underwrote

fire insurance and was formed in Charles Town (modern-day

Charleston), South Carolina, in 1732. Benjamin Franklin

helped to popularize and make standard the practice of

insurance, particularly against fire in the form of perpetual

insurance. In 1752, he founded the Philadelphia

Contributionship for the Insurance of Houses from Loss by

Fire.[19] Franklin's company was the first to make

contributions toward fire prevention.

23In the United States, regulation of the insurance industry

primary resides with individual state insurance departments.

The current state insurance regulatory framework has its

roots in the 19th century, when New Hampshire appointed

the first insurance commissioner in 1851. Congress adopted

the McCarran-Ferguson Act in 1945, which declared that

states should regulate the business of insurance and to affirm

that the continued regulation of the insurance industry by the

states is in the public's best interest. The Financial

Modernization Act of 1999, commonly referred to as

"Gramm-Leach-Bliley", established a comprehensive

framework to authorize affiliations between banks, securities

firms, and insurers, and once again acknowledged that states

should regulate insurance.

Whereas insurance markets have become centralized

nationally and internationally, state insurance commissioners

operate individually, though at times in concert through the

National Association of Insurance Commissioners. In recent

years, some have called for a dual state and federal regulatory

system (commonly referred to as the Optional federal charter

(OFC)) for insurance similar to the banking industry.

24

History of insurance in India

In India, insurance has a deep-rooted history. It finds mention

in the writings of Manu ( Manusmrithi ), Yagnavalkya

( Dharmasastra ) and Kautilya ( Arthasastra ). The writings

talk in terms of pooling of resources that could be re-

distributed in times of calamities such as fire, floods,

epidemics and famine. This was probably a pre-cursor to

modern day insurance. Ancient Indian history has preserved

the earliest traces of insurance in the form of marine trade

loans and carriers’ contracts. Insurance in India has evolved

over time heavily drawing from other countries, England in

particular.1818 saw the advent of life insurance business in

India with the establishment of the Oriental Life Insurance

Company in

Calcutta. This Company however failed in 1834. In 1829, the

Madras Equitable had begun transacting life insurance

business in the Madras Presidency. 1870 saw the enactment

of the British Insurance Act and in the last three decades of

25the nineteenth century, the Bombay Mutual (1871), Oriental

(1874) and Empire of India (1897) were started in the

Bombay Residency. This era, however, was dominated by

foreign insurance offices which did good business in India,

namely Albert Life Assurance, Royal Insurance, Liverpool

and London Globe Insurance and the Indian offices were up

for hard competition from the foreign companies.

In 1914, the Government of India started publishing returns

of Insurance Companies in India. The Indian Life Assurance

Companies Act, 1912 was the first statutory measure to

regulate life business. In 1928, the Indian Insurance

Companies Act was enacted to enable the Government to

collect statistical information about both life and non-life

business transacted in India by Indian and foreign insurers

including provident insurance societies. In 1938, with a view

to protecting the interest of the Insurance public, the earlier

legislation was consolidated and amended by the Insurance

Act, 1938 with comprehensive provisions for effective

control over the activities of insurers.

      An Ordinance was issued on 19th January, 1956

nationalising the Life Insurance sector and Life Insurance

26Corporation came into existence in the same year. The LIC

absorbed 154 Indian, 16 non-Indian insurers as also 75

provident societies—245 Indian and foreign insurers in all.

The LIC had monopoly till the late 90s when the Insurance

sector was reopened to the private sector.   The history of

general insurance dates back to the Industrial Revolution in

the west and the consequent growth of sea-faring trade and

commerce in the 17th century. It came to India as a legacy of

British occupation. General Insurance in India has its roots in

the establishment of Triton Insurance Company Ltd., in the

year 1850 in Calcutta by the British. In 1907, the Indian

Mercantile Insurance Ltd, was set up. This was the first

company to transact all classes of general insurance business.

   In 1968, the Insurance Act was amended to regulate

investments and set minimum solvency margins. The Tariff

Advisory Committee was also set up then. In 1972 with the

passing of the General Insurance Business (Nationalisation)

Act, general insurance business was nationalized with effect

from 1st January, 1973. 107 insurers were amalgamated and

grouped into four companies, namely National Insurance

Company Ltd., the New India Assurance Company Ltd., the

Oriental Insurance Company Ltd and the United India

27Insurance Company Ltd. The General Insurance Corporation

of India was incorporated as a company in 1971 and it

commence business on January 1sst 1973.

 

Following the recommendations of the Malhotra Committee

report, in 1999, the Insurance Regulatory and Development

Authority (IRDA) was constituted as an autonomous body to

regulate and develop the insurance industry. The IRDA was

incorporated as a statutory body in April, 2000. The key

objectives of the IRDA include promotion of competition so

as to enhance customer satisfaction through increased

consumer choice and lower premiums, while ensuring the

financial security of the insurance market.

 

     The IRDA opened up the market in August 2000 with the

invitation for application for registrations. Foreign companies

were allowed ownership of up to 26%. The Authority has the

power to frame regulations under Section 114A of the

Insurance Act, 1938 and has from 2000 onwards framed

various regulations ranging from registration of companies

for carrying on insurance business to protection of

policyholders’ interests.

 

28    In December, 2000, the subsidiaries of the General

Insurance Corporation of India were restructured as

independent companies and at the same time GIC was

converted into a national re-insurer. Parliament passed a bill

de-linking the four subsidiaries from GIC in July, 2002.

 Today there are 24 general insurance companies including

the ECGC and Agriculture Insurance Corporation of India

and 23 life insurance companies operating in the country.

 

   The insurance sector is a colossal one and is growing at a

speedy rate of 15-20%. Together with banking services,

insurance services add about 7% to the country’s GDP. A

well-developed and evolved insurance sector is a boon for

economic development as it provides long- term funds for

infrastructure development at the same time strengthening the

risk taking ability of the country.

29Role of HRM

In

ICICI PrudentialAs part of this assignment we look forward to know of how

Human Resource Planning HRP is implemented in ICICI

Prudential Life Insurance Company.

Here we discuss by anticipating the usefulness of Human

Resource of ICICI Prudential in present and future strategic

management and its importance. It also tells us about the

impact of HR planning on strategic plans of ICICI Prudential.

Besides discussing of how evaluation process of present legal

requirements, it also describes the ICICI Prudential’s process

of recruitment, selection of employees from external sources

depending upon the company requirements and legislations.

ICICI Prudential has got its own style of organizing the

business process representing a specific kind of cultures and

sub-cultures within the organization. This in turn affects the

recruitment and retention processes of employees of the

organization. Various Issues were taken in to consideration to

30maintain the ‘work life balance’ and also different kinds of

practices in work that keep changing often. As it an insurance

company which deals with huge financials handlings there

might be many grievance situations pertaining to the staff and

customer as well. Many issues like fraudulent, Malpractices

and other issues of disciplinary may lead to dismissals. These

may further lead complex issues; ICICI prudential has taken

necessary actions against such obligations with the help of

external agencies like ‘ACAS, Employment Tribunals’.

Apart from all the above we are also going know how

effectively HRP of ICICI Prudential has managed in

performing well at all levels using external resources and

technological & Cultural benefits that made the work

practices easier.

ICICI PRUDENTIAL’S STRATEGIC HUMAN RESOURCES:

‘STRATEGIC CAPABILITY’ OF ICICI PRUDENCIAL:

ICICI Prudential Life has got excellent strategic capabilities

in terms of Resource-based, Dynamic Capabilities and was

successful in developing the strategic capabilities.

‘Resource Based Strategy’ in ICICI Prudential: It has got

various kinds of physical sources such the building and

branches of ICICI Prudential are spread across the world. In

31India there are about 1900 branches and advisor base of

210,000 which are well equipped with all infrastructures

furnished for effective running of organization. Moreover

enough utilities are provided for the efficiency of service

providing to the customers as well as the employees of the

organization. ‘Raw materials’ like broachers and product

portfolios are well designed to maintain the strategic pathway

in ‘production processes’. As it is a service based company

employees are the key asset to the organization. Financial

resources of ICICI Prudential are organized with Capital

investments and enough flow of funds in terms of cash

through Creditors and debtors of the organization.

‘Intellectually’ the company has a good reputation and brand

image in the market and they have got patents of their

products along with systems and data storage devices.

ICICI’s employees play a vital role in business process linked

with many advisors and franchises that have thorough

knowledge & skills servicing the customers.

‘Types of Resources and competencies’ in ICICI Prudential:

‘Threshold resources’ of ICICI had appropriate logistics

which satisfy the minimum requirements of the customers

and there by survive in the market. ICICI Prudential has

32‘Unique resources’ yet provide unique product with

exceptional services gaining competitive advantage adding

value & inimitable thus ‘Winning Core Competencies’

against the competitors. The company rarely but has got the

‘Redundancy competencies’ in solving issues of timing

fulfilling the need of customers.

According to Hamel, and Prahalad, 1994, ICICI Prudential

has gained ‘Core competency with their skills and expertise

products and they designed benefits to customers moving

from core products of Life Insurance to Health Insurance

segment where they could find target customers and satisfy

them by providing benefits at the end products.’

‘DYNAMIC CAPABILITIES’ OF ICICI PRUDENTIAL:

ICICI Prudential showed its dynamic capability by

renovating its products and services at a wide range. It

enhanced features of its services using innovation

considering environmental aspects and technological

changes.

ICICI Prudential on the other hand has Perceived Strategic

Management roles extensively to match the requirements

along with internal and external organizational skills and

competences.

33The dynamic approach of ICICI Prudential has a concept

called Learning which is a ongoing process of

implementation of tasks and work performances that are

improvised by knowing loops from past experiences and

retrieving it with new developments to it move on faster.

‘Developing Strategic Capability’ in ICICI Prudential:

With the change in environment and market structure ICICI

prudential always kept identifying the customer’s

specifications regarding the services and the products. The

company has enhanced its work process through a strategic

approach and developed it capabilities in a systematic format

to gain strategic advantage.

‘STRATEGIC CAPABILITY AND HUMAN RESOURCE’ OF ICICI PRUDENTIAL:

According to Johnson, Scholes., and Whitting., 2008, Human

Resource of ICICI Prudential had chosen 4 ways of

improvising employees performance strategically enhancing

organizational capability.

‘Targeted training and development’ in ICICI Prudential:

Here the training must be like an added value to the existing

skills so as to perform well thus attaining competence.

34Staffing policies of ICICI Prudential are designed in such a

way that the people are developed and promoted so as to

reach the targets at a faster pace as compared to the others.

‘Organizational Learning’ of ICICI Prudential: ICICI

Prudential gives facts and figures of experiences, knowledge

of approach and services and measures to encourage the

skills under common culture to achieve a common goal.

ICICI Prudential’s way of ‘Developing People awareness’:

ICICI train every individual within the organization to know

the roles and responsibilities there by work according with a

purpose of strategy.

‘PUTTING TOGETHER AN HR STRATERGY’ OF ICICI PRUDENTIAL:

The human resource strategies of ICICI are distinguished by

‘hard and soft ways where in competences and resources

comes under and a kind of approach that motivates to gain

competitive advantage’.

‘Linking ICICI Prudential and HR Strategies’ of it:

In ICICI Prudential the HR strategy acts as a medium

between the resource based and the Business processes of the

organization.

35Johnson, Scholes, and Wittington., 2008 stated that

‘Resource strategies are inter-related both between the

strategies of business and with every departments pertaining

to every individual in each divisions like Staff oriented,

technology, information system, finance related matters of

organization like ICICI Pru’.

Apart from this ICICI Prudential has also set Long term and

Short term strategies for the improvement of the organization

and the people in it.

Long term goals mainly comprise of future goals pertaining

to leaders, building up the workforce and the organization on

the whole. Whereas short term goals are those which are

analyzed through ‘GAP Analysis’ which mostly deals with

current skills and abilities and people, performance

appraisals, recruitment and reward system also with

improvement in HR practices and also bringing new practices

within the organization.

To fulfill the future needs of the organization strategies like

recruitment and training & development, renovating and

restructuring, outsourcing and other join collaborations

helped ICICI Prudential reach its future goals successfully.

36‘Components of HR Strategy’ in ICICI Prudential:

The main key components of ICICI’s HR strategy are given

as follows:

ICICI’s ‘People as a Resource’: This is a hard approach

which comprise of various functions of audit that involve

people oriented core competency for future policies, targets

and goals are set here along with performance appraisals,

recruitment, retentions and training & development in the

workforce take place in this resource.

‘People and Behavioral approach’ of ICICI: This is a soft

based approach that deals with cultural aspects and issues of

changing people behavioral aspects along with changing style

and environment.

ICICI Pru’s way of organizing people: In this Hr functions

play a vital role and indulge in various functions such as

regulatory, service providing managerial roles along with

structure of ICICI and its processes.

ICICI PRUDENTIAL’S ‘ORGANIZATIONAL DESIGN’:

It is the major part of Human resource strategies where in it

deals with cultural issues like ‘norms, values and

37organizational paradigm. Besides this it has regulates the

responsibilities with linkages. ICICI Pru’ has got a non-

complex structure of cultures showing their uniqueness in it.

TYPES OF ‘ORGANISATIONAL DESIGN IN ICICI Pru’:

‘Task Culture’ in ICICI deals with various issues and

problems from all the departments of the company. This

culture has working bodies and group committees where in

research and developmental activities take part. It gather the

whole of information from all the resources and departmental

functions to work on it specializes task teams are involved

for a short period of time who need work on a common task

to meet future requirements.

‘Power Culture’ is not much related to ICICI Prudential

because this kind of culture is one person based control who

likes to take control and react to situations.

‘Role Culture’ in ICICI: It is such a kind of culture where

work roles an organization are segregated to different levels

and functions and assigned to employees where they need to

perform on their particular. ICICI Prudential follows the role

culture in operating its functions. This improved not only the

productivity but also the stability in performing the roles

increasing the revenues to the organization. Though role

38culture states the weakness in adapting to changes in

generating but ICICI Prudential was even successful in it.

Apart from this there is also Person culture which mostly

deals with charities and this culture no way related with

ICICI Prudential Life Insurance.

‘ROLES OF DIFFERENT WORKER GROUPS’ IN ICICI PRUDENTIAL:

There are 3 different worker groups in ICICI and are stated

below;

‘Core Workers’ in ICICI: This group consists of different

functional departments like sales, finance and human

resource that are knowledge based which directly contribute

to the core business of ICICI.

‘Insource Workers’ in ICICI: This group of work deals with

temporary contractors, part-time employees and brokerage

agents of ICICI Prudential.

‘Outsource Work’ of ICICI: The IT related work, payroll

processing and taxation based work is outsourced to other

companies which specialized in those fields.

39ICICI PRUDENTIAL METHOD OF ‘ATTRACTING TALENT’:

The recruitment is nothing but choosing the right candidate

for the right job considering specific skills and requirements

of the organization.

In ICICI Prudential the basic task of HR is to know what

exactly the organization is looking out for and perfectly

designing the job description mentioning the roles and

responsible.

Moving further the Human resource department should

attract the qualified candidates through diversified methods.

The Human Resource choose various sources of attracting

people like giving demos in the colleges and universities to

pool out the talented candidates and attract them by coding

the success rates of the company and winning stories of

existing employees and also code the benefits and growth

within the company. The other mode of attracting

experienced talent is by showing the exciting working

environment with a challenging position along with good pay

package and also hierarchal growth in position of employees

and many other benefits that are offered by the company.

40In attracting these relevant candidates ICICI Prudential does

advertise using Marketing methods internal and external

means. The internal means of attracting the candidates is

through the referral forum set in company’s web page where

in all the existing employees who are willing to relocation or

move to other department operating other functional roles

can look at that forum and know about vacant positions in the

company. They employees can even refer their friends or

network group who suit to that position.

External means such as Media & Paper advertisements,

holding at the public places and at times the company even

approach consultancies who supply manpower. Rewards

were given to the prospective workers motivating them to

work efficiently and make them active in fulfilling the

requirements of the organization.

This can also quoted as a Marketing Exercise of the ICICI

Prudential through Recruitment process with which the

company gets attention of public towards it.

‘Recruiting Process of Talent hunt’ in ICICI Prudential:

The process of Recruitment is done through various factors

and the process is divided into 2 types:

41‘Internal Recruitment’

‘External Recruitment’

‘Internal Recruitment’ Process in ICICI has referral forum in

company’s web-page called ‘ATLAS’ where in job

requirements are posted. And for few particular positions like

Managerial roles in the organization they trace out the

performances of the existing employees and conduct a review

of selection process.

‘External Recruitment’ Process in ICICI has diversified

methods such as souring from Manpower suppliers,

conducting interviews for the candidates at university

campuses.

ICICI Prudential often conducts walk-in interviews which is

a time and cost saving method. It had also tied-up with few

online portals where they can post the job requirements at a

regular basis. Apart from these ICICI prudential also pull out

candidates from various sources like Media &

communication, advertisements and cross communication

sources.

42‘Job Description and Person Specification’ in ICICI Prudential:

The job description comprises of roles and responsibilities of

an individual who is supposed to perform after getting a

specific job using skills and abilities. The candidate should

be suitable enough to apply for the required post. The person

should be able to produce relevant documental proofs of

qualification and experiences. They need to health enough to

perform the job under pressures and flexible to work and

shouldn’t have any criminal offenses in the past. Effective

communicational skills are must to perform any kind of job

to understand and interpret the work. Positive driven attitudes

gives positive results of the work.

‘Reviewing the Effectiveness of Recruitment’ in ICICI

Prudential, the HR department play major role in recruitment

process. The effective process of recruitment starts from

screening the profile of the candidates and filter them which

are much suitable for the requirement. The selected profiles

were considered and called for preliminary interview which

will taken by the HR consultant. The candidates must fill the

application form furnishing their details. These details are

stored in the database of ICICI Prudential’s called as ‘PACE’

which consists of all the details of the candidates who applied

for the job. This help in easy tracking candidate information.

43SELECTION AND INDUCTING TALENT:

According to Torrington, et al derived ‘7 criteria for

Selection process; it is sure that ineffective selection process

affects the organization in terms of money, time and poor

performances.’'

In ICICI the selection method has assessment centers for

selecting professionals like managers and Technicians,

Developers etc., Acceptable and appropriate test is conducted

in ICICI Prudential to entry level and senior manager posts.

In the process of selection the application forms and CV are

considered with which they are shortlisted for the interview.

ICICI has self-assessment form where candidate assess

themselves to the post. Interview for selection can be done

through different ways depending upon the post and the

requirement. Managers in ICICI use ‘stereotypic and halo-

horn effects’ while selecting the candidates.

After the selection process the selected candidates are

inducted which tells about the ICICI Prudential’s Mission

vision and what is their limitation and what is the new

employee’s role in performing work.

44ICICI PRUDENTIAL ‘CULTURE AND WORKING PRACTICES’:

According to Edger S., and Hofstede, Keuning, 1998; Culture

is defined as “The method of shared ‘basic assumptions and

beliefs’ with internal as well as external values, by the

employees of the organization to move forward positively

avoiding problems by restricting the taking for granted

environment”.

Cultures are diversified in ICICI Prudential depending the

location, work pattern and the geographically into many sub-

cultures. The Marketing and sales department cultural

approach is different from finance department these are

called as ‘Sub- Cultures’. As the company has spread

worldwide they follow different cultures for different cultures

but the goal stands the same. It has become important for the

company to organize cultures depending upon the hierarchy

levels and working areas and departments.

The environmental changes also made ICICI prudential to

change their cultural approach towards the customers. This

made ICICI Prudential receive award as ‘Best cultural

company of the year 2008’.

According to Dobson, 1988, ‘analyzing and changing Culture

of ICICI Prudential in terms of stories and rituals, formal

45activities avoiding informal gossips that may affect the

company. They undergo change in ‘recruitment process and

redundancy policies of ICICI Prudential there reorganize the

things and communications methods, systems, procedure and

policies are even changed considering environmental and

technological effects.’

‘CHANGING OF WORK PRACTICES’ OF ICICI

PRUDENTIAL shown a positive as well as a negative effect

with which the reputation of company changed going ups and

down, employees were deprived with marketing challenges

and sales targets change made employees to leave the

organization frequently with which there was cost

effectiveness. All the factors like ‘demographic, diversifying

issues, market position and place, customers perception and

demand in the market and even skills shortages’.

The Work-Life Balance in ICICI Prudential:

According to David Clutterbuck, considering ‘the culture and

the work practices the work-life balance will be affecting

where employees need to be satisfied with the job and

maintain a equal balance between given time and effort to

work which gives life into other aspects.’

46Employees have to manage their work in a systematic

manner so as to benefit him as well as the organization.

Social and economic changes show the impact on work-life

balance.

LEGAL REQUIREMENTS AND EXTERNAL AGENCIES OF ICICI PRUDENTIAL:

There should be proper fairness in recruiting and selection

process by choosing the right candidates for the right post

and documenting the information of selection process

effectively to avoid irrelevance in selection. Proper

protection also is given to employees of the organization

giving them insurance coverage and Medical benefits. The

information of all employment patterns is correctly

maintained.

Proper guidelines and procedure are to be followed to with

the help of ‘Equal Opportunities Commission (EOC)’,

‘Commission for Racial Equality (CRE)’ and also with

‘ACAS-Advisory Conciliation and Arbitration Services’ are

linked to ICICI Pru’.

Grievance in ICICI: According to Ankur, chabra., 2009 “

grievance are the symptoms of enterprise conflicts. This is

done when an employee does any in disciplinary or

47fraudulent actions but at times if there any unfair dismissal

then this may lead to conflicts.

‘Role of ACAS’:

The role of ACAS is:

‘Arbitration’ - ‘Both the parties are called for third party

investigation about dispute’.

‘Conciliation’ -‘Communication gaps are cleared bringing

both together and assisting them’

‘Meditation’ - ‘Same as arbitration but mediator has major in

solving the problem’.

The different cultures with different sub cultures are

implemented within various functions and departments of the

ICICI Prudential LIFE. ICICI had Strong legal requirements

and tie-ups with external agencies to handle the conflicts in

the Organization.

Objective Insurance Advisors or Financial Advisors play

very Important role for the Company, because this Advisors

is the present and future assets of the company , as they

treated like a Partner of the ICICI Prudential Life Insurance

Company Ltd. . ” The Primary Objectives of ICICI

48Prudential is to Improve Knowledge about the Insurance

Industry and How to achieve the goals and Objectives in

order to face the Competitive World by knowing Personality

Development Skills . ” The Secondary objective was to find

out - 1. Why Batches getting Cancel ? 2. Exam Attendance 3.

Exam Pass-out Ratio Our Project “Recruitment and Training

and Development of ICICI Prudential” which mainly focus

on finding out Importance of Training and Development for

Insurance Advisors. Theory and Concept Training generally

refers to reaching of new skill in professional field of the

employee. Like an employee being taught to operate another

machine, or to perform a new operation in the same machine.

Development refers to enhancement of personal qualities of

the employee which do not have a one to one relationship

with his current job. It may be to help an employee to grow.

Like stress management techniques, yoga lessons, meditation

exercises, soft skills training, etc. While training is expected

to reward the company immediately in terms of better

productivity of employee, Development does not lead to a by

immediate and tangible benefits to the company. At the best,

there might be some intangible benefits in the long run, like

improved motivation, loyalty, improved intra-departmental

relations, reduced absenteeism on medical ground etc.

49Dividing line between training and development is

expectation of immediate benefits. Thus, in case a program,

generally qualifying as development program, is directly

related to employee’s job skills, like Communication Skills

course for telephone attendant or receptionist, will qualify as

training and not as development. Same program for someone

in back office would be termed as “Development Program.”

Definition of Training & Development : “ Training &

Development ” is any attempt to improve current or future

employee Performance by improving his performance

capabilities and potential through learning, usually by

changing the employee’s attitude or increasing his or her

skills and knowledge .The need for Training and

Development is determined by the employee’s performance

deficiency, computed as follows – Training & Development

Need = Standard Performance - Actual Performance

Objectives of Management Development Programs ( MDP ) :

To make the managers - Self –Starters - Committed -

Motivated - Result Oriented - Sensitive to environment -

Creating the self awareness - Develop inspiring leadership

styles - Teach them about effective Communication Meaning

of Recruitment: The human resources are the most important

assets of an organization. The success or failure of an

50organization is largely dependent on the caliber of the people

working therein. Without positive and creative contributions

from people, organizations cannot progress and prosper. In

order to achieve the goals or perform the activities of an

organization, therefore, we need to recruit people with

requisite skills, qualifications and experience. While doing

so, we have to keep the present as well as the future

requirements of the organization in mind.

Definition of Recruitment: Recruitment is the

process of locating and encouraging potential applicants to

apply for existing or anticipated job openings. It is actually a

linking function, joining together those with jobs to fill and

those seeking jobs. Recruitment, logically, aims at (i)

attracting a large number of qualified applicants who are

ready to take up the job if it’s offered and (ii) offering

enough information for unqualified persons to self-select

themselves out( for example, the recruitment ad of a foreign

bank may invite applications from chartered accountants who

have cleared the CA examination in the first attempt only.)

Recruitment is the

51

discovering of potential applicants for actual or anticipated

organizational vacancies.

Recruitment Policies and Procedures: One of the first steps in

planning for the recruitment of employees into the

organization is to establish proper policies and procedures. A

recruitment policy indicates the organizations’ code of

conduct in this area of activity.

A typical policy statement for recruitment may run thus : In

its recruitment activities, the company will :

• Advertise all Vacancies internally

• Reply to every job applicant promptly

• Inform job applicants the basic details and job conditions

of every job advertised.

• Process all applications with efficiency and courtesy

• Seek candidates on the basis of their qualifications

• Aim to ensure that every person invited for interview will

be given a fair and through hearing.

52

Company Profile About ICICI

Prudential Life Insurance Company

Ltd: 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 equity base stands at

Rs. 9.25 billion with ICICI Bank and Prudential plc holding

74% and 26% stake respectively. In 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 6,15,000 policies. The company has a

network of about 56,000 advisors; as well as 7 Banc

assurance and 150 corporate agent tie-ups. For the past four

years, ICICI Prudential has retained its Position as the No. 1

Private Life Insurer in the country, with a wide range of

53flexible Products that meet the needs of the Indian customer

at every step in life.

SOME FACTS :

1. Life Insurance Company (LIC) invested 26% in ICICI

Prudential Company.

2. Over 2,70,000 Financial Advisors which includes brokers,

housewives, Chartered Accountants, retired Persons,

Businessmen, Graduate and Undergraduate Students etc.

3. Over 16 million customers across the globe.

4. Present in 14 countries throughout Asia.

5. 75 years of experience in Asia.

6. Given Insurance to Titanic that sank.

7. Prudential sponsored Cricket World Cup in 1983.

Vision: - “To make ICICI Prudential the dominant Life

and Pensions player built on trust by World-class People and

54Service. ” This is what company hopes to achieve: ?

Understanding the needs of customers and offering them

superior products and service? Leveraging technology to

service customers quickly, efficiently and conveniently. ?

Developing and implementing superior risk management and

investment strategies to offer sustainable and stable returns to

Company’s policyholders ? Providing an enabling

environment to foster growth and learning for Companies

employees ? And above all, building transparency in all

Company’s dealings. The success of the company will be

founded in its unflinching commitment to 5 core values

-------- Integrity, Customer First, Boundary less, Ownership

and Passion. Each of the values describes what the company

stands for, the qualities of people and the way they work.

Company believes that it is on the threshold of an exciting

new opportunity, where it can play a significant role in

redefining and reshaping the sector. Given the quality of

parentage and the commitment of its team, there are no limits

to its growth.

55

PROMOTERS ICICI Bank: ICICI was founded by

the World Bank, Government of India and representatives of

the private sector in 1955 to encourage and assist industrial

development and investment in India. ICICI Bank is India’s

second-largest bank with total assets of about Rs.112, 024

Crore and a network of about 450 branches and offices and

about 1750 ATMs. It offers a wide range of banking products

and financial services to corporate and retail customers

through a variety of delivery channels and through its

specialized subsidiaries and affiliates in the areas of

investment banking, life and non-life insurance, venture

capital, asset management and information technology. ICICI

Bank posted a net profit of Rs.1637 Crore for the year ended

March 31, 2004. ICICI Bank’s equity shares are listed in

India on stock exchanges at Chennai, Delhi, Kolkata and

Vadodara, the Stock Exchange, Mumbai and the National

Stock Exchange of India Limited and its American

56Depositary Receipts (ADR’s) are listed on the New York

Stock Exchange (NYSE).The Various segment of ICICI are .

Prudential Plc Established in London in 1848, Prudential plc,

through its businesses in the UK and Europe, the US and

Asia, provides retail financial services products and services

to more than 16 million customers, policyholder and unit

holders worldwide. As of June 30, 2004, the company had

over US $300 billion in funds under management. Prudential

has brought to market an integrated range of financial

services products that now includes life assurance, pensions,

mutual funds, banking, investment management and general

insurance. In Asia, Prudential is the leading European life

insurance company with a vast network of 24 life and mutual

fund operations in twelve countries - China, Hong Kong,

India, Indonesia, Japan, Korea, Malaysia, the Philippines,

Singapore, Taiwan, Thailand and Vietnam. The company has

six Bancassurance tie-ups, having agreements with ICICI

Bank, Federal Bank, South Indian Bank, Bank of India, Lord

Krishna Bank and some co- operative banks, as well as over

150 corporate agents and brokers. It has also tied up with

NGOs, MFIs and corporates for the distribution of rural

policies and organizations like Dhan for distribution of

Salaam Zindagi, a policy for the socially and economically

57underprivileged sections of society. ICICI Prudential has

recruited and trained about 2,14,000 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.

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 27 products can be

enhanced with up to 6 riders, to create a customized solution

for each policyholder.

Savings Solutions:

• SecurePlus is a transparent and feature-packed savings plan

that offers 3 levels of protection.

• Cash Plus is a transparent, feature-packed savings plan that

offers 3 levels of protection as well as liquidity options.

• Save?n?Protect is a traditional endowment savings plan that

offers life protection along with adequate returns.

58• 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.

• LifeTime & LifeTime II 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.

• LifeLink II is a single premium Market Linked Insurance

Plan which combines life insurance cover with the

opportunity to stay invested in the stock market.

• Premier Life is a limited premium paying plan that offers

customers life insurance cover till the age of 75.

• InvestShield Life is a Market Linked plan that provides

capital guarantee on the invested premiums and declared

bonus interest.

• InvestShield Cash is a Market Linked plan that provides

capital guarantee on the invested premiums and declared

bonus interest along with flexible liquidity options.

• InvestShield Gold is a Market Linked plan that provides

capital guarantee on the invested premiums and declared

bonus interest along with limited premium payment terms.

59• 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.

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.

Retirement Solutions: • Forever Life is a

retirement product targeted at individuals in their thirties. •

SecurePlus Pension is a flexible pension plan that allows one

to select between 3 levels of cover. Market-linked retirement

products • LifeTime Pension II is a regular premium market-

linked pension plan • Life Link Pension II is a single

60premium market-linked pension plan. • Invest Shield Pension

is a regular premium pension plan with a capital guarantee on

the investible premium and declared bonuses. ICICI

Prudential also launched- Salaam Zindagi, a social sector

group insurance policy targeted at the economically

underprivileged sections of the society.

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.

61• 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 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. Flexible Rider Options ICICI

Prudential Life offers flexible riders, which can be added to

the basic policy at a marginal cost, depending on the specific

needs of the customer.

• Accident & disability benefit: If death occurs as the result

of an accident during the term of the policy, the beneficiary

receives an additional amount equal to the sum assured under

the policy. If the death occurs while traveling in an

authorized mass transport vehicle, the beneficiary will be

entitled to twice the sum assured as additional benefit.

• Accident Benefit: This rider option pays the sum assured

under the rider on death due to accident.

• Critical Illness Benefit: protects the insured against

financial loss in the event of 9 specified critical illnesses.

Benefits are payable to the insured for medical expenses prior

to death.

62• Major Surgical Assistance Benefit: provides financial

support in the event of medical emergencies, ensuring

benefits are payable to the life

What Company looks in Insurance Advisors?

ICICI Prudential Life Insurance Company Ltd. wants from the Insurance Advisors: a) Knowledge b) Professionalism c) Hard work d) Patience e) Sincerity f) Target Achieve

What Insurance Advisors wants from IPRU? Insurance Advisors wants from the IPRU: a) Commission b) Knowledge c) Rewards and Recognition d) No Target e) Flexible Working hours f) Trustworthiness

63Why Training and Development is required?

a) How to pitch the Product b) Provide Marketing knowledge to the Insurance Advisors c) To motivate the Insurance Advisors d) To Improve Communication Skills e) To face the Competitive World f) Lack of Professionalism g) Increased Productivity / quality of work/ Low Business h) Improve morale of the workforce

CONCLUSION:

ICICI Prudential Life Insurance has effective implemented it

Human Resource strategies in HR planning going out with an

outstanding resource based strategy and also shown dynamic

capability and developing them. Human resource strategies

are well linked to the Business process of ICICI Prudential

and designed the organization in such way that goes with

well worker groups. Practices like Attracting, Recruitment

and selection procedures of ICICI Prudential have diversified

means fulfilling the requirements of the company perfectly.