HR PRACTICE AT NTPC-A LOOK

INTRODUCTION NTPC was established as a public sector power utility by Government of India on November 7, 1975. The reason NTPC was created was to bridge the huge electricity supply-demand gap and the State Electricity Boards were not able to cope up with the situation. True to the expectation, it played a key role in the development of the sector, lighting every fourth bulb in the country, become the largest power utility of India, Sixth largest thermal power generator in the World and the Second most efficient utility in terms of capacity utilization. Rightly, NTPC has set for itself the Vision statement “To be one of the world’s largest and best power utilities, powering India’s growth”. NTPC strongly believes in achieving organizational excellence through Human Resources and follows "People First" approach to leverage the potential of it’s over 25,000 employees to fulfill its business plans. The “Personnel & Administration (P&A)” function was rechristened as HR to align the function with the HR Vision of "enabling the people of NTPC to be a family of committed world class professionals making it a learning organization” and bring sensitivity and human face to the function. It has formulated an integrated HR strategy which rests on four building blocks of HR viz. o Competence building, o Commitment building, o Culture building and o Systems building All HR initiatives are undertaken within this broad framework. NTPC, a Navratna, was voted as the best employer in the country in many HR surveys in the recent years. The company is well known for its employee friendly HR practices. NTPC attracts the best talent from across the country and recruits candidates by conducting one of the toughest selection process. THE HR PRACTICES Most of the HR practices of NTPC are a result of the vision and the culture that they have created over the years. Since its inception, till the early 1990s, NTPC recruited employees from engineering colleges. The training imparted to them was largely informal and consist of on the job training. In the early 1990s it experienced a shortfall of skilled manpower in the organization due to which it could not realize its growth plan. The company during that time developed the policy of recruiting personnel with generic analytical skills and high learning potential and of imparting them with specific skill required for the job offered in the company.

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Other qualities: Other qualities include analytical ability.HR PRACTICE AT NTPC-A LOOK The company believes that in order to succeed in the competitive environment it is necessary to recruit. it means the ability to derive generic knowledge from specific experiences and apply the same in new situation. it recruited mainly at the entry level for the posts of around 400 Executive Trainees every year. The career model that the NTPC has created emphasizes on individual growth along with organizational growth. Around 80% of NTPC’s executives were engineers. RECRUITMENT NTPC takes adequate steps to recruit people on the basis of various factors to identify the right candidate. Since the company followed the lifetime employment policy as a PSU. NTPC gave preference to recruitment of engineers. along with a practical and a structured approach to problem solving. and retain talented employees. the role of the employee is defined and for each role competencies have been identified and created. performance appraisal and career progression are carried out based on the roles. The company do not usually hire from premier institutes like Indian Institute of Technology (IIT) and Indian Institute of Management (IIM) but preferred to take candidates from National Institute of Technology (NITs) during campus recruitments. • • Recruitment Programs: Human resource planning at NTPC was undertaken in accordance with organizational objectives and in line with its organizational culture. The company had two executive positions for every three non-executive positions. Competency: NTPC give more importance to professional competence and academic excellence. NTPC aims at recruiting the best available talent. Recruitment. teamwork. NTPC identifies the structural requirement of the people at different levels and creates a demand for the roles. training them according to the industry demands and retaining them in a culture that promoted informal learning and free flow of ideas. train. This allowed the company the freedom to mold these 2 . Therefore. NTPC adopts a role-based structure. The employees can identify their career path and the additional skills they would have to obtain to move ahead in their career. which ensures an employee career growth through different streams. training. • Learnability: NTPC give more emphasis on learnability. Most of the jobs at the company required thorough technical skills. communication and innovation skills. leadership potential. Lateral recruitments especially at the senior levels were very few. If the employees fulfill those demands they would inspire for that role. The following are the main factors that are considered while recruiting new employees. In each of the streams.

Chemistry. more than 50 % of the executive strength in the company is through this talent building mechanism. Today. This way. Recruitment Procedure: NTPC recruited mainly at the entry level for the posts of around 400-500 Executive Trainees every year. Electrical. During the interview a candidate’s technical knowledge.HR PRACTICE AT NTPC-A LOOK engineers to fit its own culture. Civil. flexibility and aspiration level are tested. HR and Finance disciplines also. 3 . The Steps in recruitment procedure: The selection process involved three stages: o Written test . Besides a comprehensive one year training comprising theoretical inputs as well as on-the-job training. Chemistry. Some of the highlights of NTPC’s Recruitment Plan: o Preference to marginalised classes of society o SC/ST. The Executive trainees are the back bone of Engineering. The Induction Program: To induct talent and groom them into a dedicated cadre of power professionals "Executive Trainee" Scheme was introduced in the year 1977 for recruitment in the disciplines of Mechanical. presentation skills. company’s specific skills can be (has been) developed and nurtured among the employees. interview is a mode of selection. Finance. communication skills. the new recruits are also attached with senior executives under a systematic and formal “Mentoring System” of the company to integrate them into the Culture of the company. o Group discussion – Further short listing is done on the basis of group discussion.OBC o ex-servicemen o Project Affected Persons (PAPs) o Physically challenged So we do find a tinge of Corporate Social Responsibility in the recruitment plan of NTPC. HR.Candidates are called for a written test to test the knowledge of their subject. It could also check any possible mismatch between the job and an individual’s expectations. o Interview . Candidates who scored the cut off marks in the selection test are called for a Group Discussion. For lateral recruitment above entry level. IT and Hydro functions of the company.The interview panel consists of personnel from HR department and technical manager. NTPC follows lateral recruitment programs for experienced cadre of managers as NTPC offers an environment wherein there is a great deal of freedom and challenges. Apart from this. Control & Instrumentation and now encompasses Computer Science.

The institute moved to an independent campus at Noida. BITS.HR PRACTICE AT NTPC-A LOOK TRAINING AND DEVELOPMENT A systematic Training plan has been formulated for ensuring minimum seven man days (56 hours) training per employee per year and includes level-wise planned intervention designed to groom people for assuming positions of higher responsibility.Pilani (B. Opportunities for long term education are also provided to employees through tie ups (MOU) with reputed Institutions like IIT-Delhi. The programs at the center were open to NTPC managers (middle and senior levels) as well as to managers from state electricity boards and from multinational companies. and even took managers from other countries. World Bank and E7 group21. etc. (M. o quality management and o continuous performance improvement Besides several management development programs. The institute’s activities included conducting management development programs. and ones supported by Indian institutions such as Administrative Staff College of India (ASCI) 22. Tunisia. NTPC wanted its employees to better themselves continuously. The center also undertook training courses supported by foreign agencies like USAID. MDI-Gurgaon (Post Graduate Diploma in Business Management). Tech in Power Generation Technology). Hyderabad and IIM. many companies from countries like Korea. These Centers give a good 4 . These programs included business simulations and experiential exercises and were conducted in association with NIS Sparta24. which focused on management development. NTPC has institutionalized "Development Centers" in the company to systematically diagnose the current and potential competency requirements of the employees with the objective of enhancing their development in a planned manner. classrooms and residential and recreational facilities for trainees. the company also conducted leadership development programs for its executive directors and general managers. as well as specific needbased interventions based on scientific Training Needs Analysis. New Delhi as a full fledged Training and Development Centre in 1994.Tech) etc. Continuing with their commitment towards developing itself into a learning organization and aligning itself with its corporate vision. They were called Employee Development Centers (EDCs). Overseas Development Agency (ODA) UK. the company also ran technical training centers at all its 20 plants. They were open to managers in the power sector as well as those not in the power sector. The learning center at PMI had a good library of books as well as international databases and enabled online library access. The company identified the following areas as its focus for training: o change management. The PMI campus had a well-equipped auditorium. PMI’s mission was to work towards “wider adoption of innovative and relevant management concepts in the power sector”. the company established a training institute called the Power Management Institute (PMI). Such has been success of this project that it has become a premier training imparting institute and due to the high quality of PMI training. as well as research and consultancy. Apart from PMI. came to India to attend the training programs. Ahmedabad.

The company has two Simulation Training Institutes at Korba in Chattisgarh. At NTPC there was a peer pressure to excel and this also contributed to performance and Efficiency. based on the Balanced Scorecard principle. potential and values has been implemented in order to bring objectivity and transparency in performance evaluation and in order to build a culture of high performance.5000 lakh and no wonder NTPC means serious business when it comes to training and development of its employees. The company ensured that it recruited competitive people. NTPC has >90% utilization of its fund allotted to T&D. “In NTPC if a peer is learning anything new. NTPC created a performance-driven work culture. The company’s efforts towards corporate planning began at the top with general managers of all power plants gathering to discuss their targets by benchmarking with the best performing plants within the company. and were further broken down to provide individual targets for employees. As one of its employees remarked. and with other plants within and outside India. through the use of benchmarking. NTPC linked its promotions to performance rather than years of service right from the very beginning. A major revamp of the company’s HR strategy was undertaken around this time and the company modified its appraisal system to adopt a 360 degree feedback system based on Key Result Areas (KRAs) to bring in more transparency. NTPC had operated through a system of Confidential Reports (CRs) for performance appraisal. you will start doing that 5 . PERFORMANCE APPRAISAL Till the early 1990s. It had also initiated the implementation of an HR Score Card. and at Kawas in Gujarat. with the help of Hewitt Associates. a Performance Management System (PMS) based on Key Performance Areas (KPAs) in addition to competency.HR PRACTICE AT NTPC-A LOOK insight to the employees about their: o Strengths and weaknesses o The gaps in their competencies which they can bridge through suitable support from company. The company had also pioneered the use of simulation training in the country in 1984. full of challenge for its employees. The simulation training also raised the level of proficiency and equipped employees to handle emergencies effectively. NTPC has a training budget which is more than Rs. Intensive preparation has been done for implementing the new PMS. These institutes enable employees to learn the operations of a real power plant without any loss or damage to the company. By 2004. NTPC had revised its performance appraisal system and introduced a new rewards system in line with the recommendations of M/s AT Kearney to strengthen its high performance culture. In line with the recommendation of M/s AT Kearney. Here the employees imparted specialized technical training to employees based on systematic identification of their competencies and training needs. Targets were then set. The company had adopted the mindset of viewing problems as opportunities and this culture motivated the employees to perform. based on these benchmarks.

NTPC offers best quality-of-life through beautiful townships with all amenities such as educational.K.C. otherwise. it has more flexibility. NTPC has developed strong employee welfare. Shrivastav. there is a fear that they will get ahead and get that promotion. they were moved to less important roles. It adds learning value through training and development and appraisal practices. It has also been extended to cover DGMs. As a last resort. the company asked the employee to opt for its Voluntary Retirement Scheme (VRS). and adds financial value through monetary compensation. Although NTPC faces strong domestic and international competition for its human assets. EMPLOYEES WELFARE. health & well-being and social security systems leading to high level of commitment. Remote locations mean the company has to take care of things such as the education of employees’ children. NTPC adds emotional value through initiatives directed towards supporting employees with their work and personal needs. Social Security on Superannuation – Employees Provident Fund – Gratuity – Employees Voluntary Benevolent Fund – Self Contributory Pension Scheme – Post Retirement Health scheme Education 6 . What binds employees to NTPC is security. 360-degree feedback mechanism for AGMs and above was introduced with substantial participation. even after retirement. Moreover. HEALTH & SOCIAL SECURITY Demonstrating its high concern for people. executive director (HR): “We are bound by government regulations as far as salaries are concerned. says R. The culture was such that if an employee missed three to four promotions he felt cut out from the company’s mainstream. through enticing offers from competitors. The motivation to perform and excel is further enhanced through a comprehensive NTPC Rewards and Recognition system.” He added that the employees who did not get promoted viewed it as a punishment and worked even harder to get it next year. NTPC’s entry level salaries are higher than its private counterparts. Our HR policy is worked around boundaries. Says G. It is neither above market nor below the market level. Below par performers were sent for remedial training and if performance still didn’t improve. if there was no hope of improvement.” But now that it has navratna status. COMPENSATION POLICIES NTPC compensates its human assets in three ways. medical and recreational opportunities for employees and their family members. the compensation level at NTPC equals the average industry level for each country.HR PRACTICE AT NTPC-A LOOK too. Apart from full medical benefits. director (HR). Agarwal. NTPC also has help desks that assist families of employees who are out of station.

Need based funding of schools Workers’ Education Scheme – Regular upskilling Children’s Education Scheme – Reimbursement/ scholarship/ award/ coaching policy – Initiative for total development Gender Equality – Policy on sexual harassment – Paternity leave Tapping rich resources available in families of employees for community development / welfare works / child development projects in and around project Physically Challenged People – Employment opportunities as per 1995 Act – 237 nos provided employment. In order to tap the latent talent among non executives and make use of their potential for creativity and innovation. Suggestion Schemes called for suggestions from employees on the company’s equipment and systems.” NTPC Open Competition for Executive Talent (NOCET) is organized every year in which teams of executives compete annually through oral and written presentation on a topical theme. and rewarded good suggestions. Besides a management journal called "Horizon" is published quarterly to enable employees to share their ideas and experiences across the organization. 7 .HR PRACTICE AT NTPC-A LOOK • • • >45 schools in various projects imparting quality education to 45000 odd children. recruitment drive for 169 persons currently in process. Quality Circles have been set up in various units/offices in NTPC. Safety Circles suggested improvements in safety measures that could be subsequently implemented by the company. – Facilities for physically challenged people – Provision of medical equipments – Holding of medical camps – Launching inclusive education in schools Health • Comprehensive health care to employees and their families – Adequate health care to community around project sites – Project Hospitals -17 – Beds-700 – Empanelled Hospitals-58 EMPLOYEES PARTICIPATION (EPM) NTPC believed that “participation and participatory culture make employees own their work and result in tremendous synergy. Similarly "Professional Circles" have been formed department-wise where Executives of the department meet every fortnight to share their knowledge and experiences and discuss topical issues.

5000 lakh. Senior executives possess extensive experience of the industry.19% of revenue allocation for training & development with 92% utilization record. NTPC has a training budget which is more than Rs.HR PRACTICE AT NTPC-A LOOK ANALYSIS OF HR PRACTICES AT NTPC: Strengths: • • • • • • More than 25 thousand highly trained employees are engaged in NTPC owned projects. Executive Turnover Rate 0. Planned interventions at various stages of career. 0. Knowledge sharing & development through various HR initiatives. Cordial & harmonious employee Relations. Systematic training ensures 7 man days training per employee per year.44%. • • • 8 .

As per one Mr. 3. • Weakness • Performance management (appraisal) is one area of concern. Employees still have apprehensions about this and are yet to have fullest of belief in the system. banking. and Tata Power Company Ltd. nuclear and bio-power. even after retirement. education of employees’ children even in remote location etc. Township with all basic amenities is one of the USP for NTPC. • NTPC yet has to implement the performance linked incentive system. As one of the employees Navneeta Bhattacharya says "In the private sector. K. it’s governed by certain rules and regulations. • Compensation though is at par with the sector norm but to recruit and retain bright people. NTPC would have to shake off even the least degree of complacency that it might 9 . Apart from full medical benefits.HR PRACTICE AT NTPC-A LOOK • • • Employee security i. power trading and power distribution things are changing and will change. pharmaceuticals and biotechnology etc. NTPC also has help desks that assist families of employees who are out of station. But with NTPC making foray in hydropower. Hence have to gear up to refine its recruiting and retaining strategies to attract young.000 MW of power by 2012 and entering the Fortune 500 listing by 2017. It has become all the more important for the company to attract the best talent to be able to realize its ambitions of becoming a complete energy company spanning thermal. from private sector players like Reliance Energy Ltd. What binds employees to NTPC is security. in the private sector emerging as preferred sectors for employment due to acetated career growth opportunities. It would be difficult as being a PSU. Director (HR) "All this will keep our employees on their toes with new challenges”. Sinha. NTPC could not allow highly accelerated career growth due to the company’s stable career policy. NTPC will have to redraw its compensation policies. it could become tough for the company to keep up its record in future. yet things has not materialized as envisaged. The IT. hydro. The Road Ahead 1.e. "People first” practice policy. Even though there had been developments to make system more transparent. coal mining. NTPC can’t be recommended for young. you don't have time for yourself. full medical benefits even after retirement..K. NTPC had enjoyed a near-monopoly till the 1990s but with increasing competition 2. This is one area of concern. Remote locations mean the company has to take care of things such as the education of employees’ children. But here you have a life and that too with benefits like well-protected townships." The 24-year-old means it. aggressive fast trackers as there is every chance on them being disillusioned in 2-3 years time as they always seek for challenges. NTPC needs to plan for incentive schemes. generating 40. aggressive fast trackers. She chucked up a job with an Indian IT giant to join NTPC.

ntpc. 5. http://www.com/media-room/speechespresentations/2006/feb/D_K_Sinha.in 3.digitaltoday.HR PRACTICE AT NTPC-A LOOK have had in the monopolistic scenario earlier.ppt 9.ntpc. http://www. it might not be enough to handle future challenges.html. It needs to again focus and canalize its effort in making its practices more employees friendly and too tough for the competitors to break-through.co.aspiresys. 2004.com 5. http://www.com/media-room/speeches-presentations/2004/july/ntpc.ficci. http://www.co. www. The differentiation factor would be the HR policies and practices. http://www.powerhrforum.com/web_pages/business_today/business_today. So they need to gear up for these challenges taking into account the threats from the competitors. http://www.shtml 7. Another area of concern for NTPC is the skewed male-female ratio with women constituting less than 5% of the total workforce References: 1.ppt 4. 10 .asp 6.in/businesstoday/20041121/cover9.shilpabichitra.com/Shilpa2004/anni_1_047.htm 2.org/casestudies/catalogue/Human%20Resource%20and %20Organization%20Behavior/HROB073. NTPC also faces the threat of poaching of its highly trained and competent employees by competitors. benchmarking and job rotation.html 8.org/members/ntpc.ficci.in/companyperformance/chairmanstat. http://www. NTPC though is doing well as far as it HR activities or processes are concerned but that was in a monopolistic environment. Though the company had ensured that employees were continuously aware about their performance through HR tools like quality circles. http://www. NTPC has earlier too engaged in a project called “DISHA” for realigning its business practices. NTPC needs to revisit its processes and plug the lacuna.htm 10.icmrindia.citehr. 4. http://archives.

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