ABSTRACT

One of the biggest challenges facing business entities is the recruitment and retaining employees
especially in the 21st century where the interest of employees is not getting employed, but rather
in getting satisfaction in their jobs. Many employees come from houses and environments that
are violent and chaotic. In the job, such kind of an employee needs to feel happy and forget the
home problems. Consequently, employees move from one job to another in search of this
environment. One of the ways of keeping these employees is to motivate them, a subject very
complex, broad and expensive. The research carried out identifies compensation and benefits of
keeping such employees in addition to the other motivational factors. Employees can very
committed to the work assigned and be working very hard. However, if their hard work is not
seen and appreciated, they become demoralized and their productivity may diminish
considerably (Werner, and DeSimone, 2009). It is believed that human resource is the most
valuable and delicate asset of a business though never included in the balance sheet of the
corporation. Mistreating them will make the productivity of the business go down and
consequently collapse, while appreciating their efforts will encourage them more leading to more
production thus growth, development, and expansion of the business with the goals, objectives,
vision, and mission in the mind in a bid to achieve them

Motivation is one of the factors that keep employees on board, motivates them to work harder
and better thus leading to increased productivity and growth of the business. Without motivation,
productivity, morale, profits, product, and service delivery becomes at stake. It may be external
or internal in nature (Werner, and DeSimone, 2009). The external motivation factors include the
non-related work environment including both financial and non-financial aspects. On the other
hand, the internal factors are those related to working environment that may include good
working relationship, clean working environment and probably use of appropriate tools.

Whether internal or external, there should be motivation. Compensation and benefits are reward
based motivational factors. Benefit is an indirect reward that an employee gets for being part of
the family or the organization (Mathis, and Jackson, 2008). On the other hand, compensation
entails the reward that is given to an employee to complement the time or any resource that he
might have used.
 INDEX
S.No CHAPTER Page No
1 CHAPTER - I 01 – 13
INTRODUCTION
NEED OF THE STUDY
SCOPE OF THE STUDY
OBJECTIVES OF THE STUDY
RESEARCH METHODOLOGY
LIMITATIONS OF THE STUDY
2 CHAPTER - II 14 – 24
REVIEW OF LITERATURE
3 CHAPTER - III 25 – 38
INDUSTRY PROFILE
COMPANY PROFILE
4 CHAPTER - IV 39 – 52
DATA ANALYSIS &INTERPRATATION
5 CHAPTER - V 53 – 57
FINDINGS
SUGGESTIONS
CONCLUSION
BIBLIOGRAPHY 58
QUESTIONNAIRE 59 - 66
 CHAPTER – I

INTRODUCTION

1
COMPENSATION MANAGEMENT
Compensation is a human resource strategy aimed at sourcing out maximum returns from the
available workforce. To do so, employees are rewarded for their contributions towards an
organization. The ultimate intention of compensation management is to offer rewards to
organization‘s employees for appropriate reasons. Compensation management entails issuing
monetary and non-monetary rewards to employees. Consequently, the employees‘ output shoots
to the positive.

Compensation management requires institution of relevant policies to ensure fair remuneration.

A recommendable compensation policy facilitates retention of the best talent while also
attracting new talent to the organization. Turnover minimization comes about as a result of
adoption of good compensation policies. Workforce analytics and employee benefit
administration supplement a compensation policy and motivate employees. A business enterprise
realizes efficiency and achievement of set goals and objectives from good compensation
management practices.

A business entity ought to formulate a good compensation system. Formulation should put into
consideration the strategic objectives and goals of the business. This means that a good
compensation system does not shun the sensitivity of a firm‘s financial and operational system.
Analysis of employees‘ responsibilities and job roles should be a key factor in formulation of
compensation management systems.

IMPORTANCE OF COMPENSATION MANAGEMENT

Compensation management is vital in acquiring the best workforce in the market. Moreover, it
acts as a basis for retention of the best one available. Without proper compensation management,
there will be no individuals willing to work for a business entity.

Motivation of employees determines its profitability. Profitability is subject to employees‘

output. Appropriate compensation management should focus on employee motivational needs. If
it addresses such needs, a business can realize increased productivity.

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Compensation does not only mean meeting the salary obligations. It also requires a business to
address psychological needs. The workforce is more productive when all the remuneration and
self-actualization needs are met. A compensation package should include all of the things. As a
result, a firm meets employee motivation needs.

Modern compensation management practices adopt specific software for handling the
compensation needs of each employee. They optimize stocks options, benefit budgets, bonuses
and salary to yield high returns levels per employee on every hour of work. However, a business
requires a good human resource management team as much as it requires computer software and
programs.

All in all, effective compensation management only serves for the benefit of the organization. It
directly determines the firm‘s profitability. Therefore, organizations should reserve special
attention towards compensation management.

WORKERS COMPENSATION:

The receipt of Workers‘ Compensation is designed to compensate employees who suffer work-
related injuries or illnesses. Workers‘ Compensation payments may be paid in lump sums or in
weekly payments over a period of time (periodic payments). Workers‘ Compensation benefits
paid in lump sums or made for medical treatments and expenses do not affect pensions.
An effective employee compensation framework is significant towards enhancing motivation
level of the employees of an organization. Stock options and post retirement benefits are some of
the components of the employee compensation framework.

Workers' Compensation laws are designed to protect employees who are hurt on the job. These
employees are provided with fixed monetary awards covered under workers compensation, thus
eliminating the need for excessive litigation.

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If an employee is injured, the employee files a claim with the workers compensation insurance
company. Most laws require that you file a claim within 30 days of the accident, or 30 days after
you learn of the injury (if it is a continuous, latent injury, such as an inability to breath).

In general, workers compensation provides replacement income, medical expenses, and

vocational rehabilitation benefits. Usually, workers compensation will pay you two-thirds of
your salary while you are injured. You may also be eligible for life-long benefits or a lump sum
payment if you are permanently hurt while on the job.

WORKERS COMPENSATION BENEFITS:

Income, medical, rehabilitation, death, and survivor payments to workers injured on the job.
State workers compensation laws, which date from early in the twentieth century, provide that
employers take responsibility for on-the-job injuries.

Compensation consists of pay and other economic and intangible benefits provided to the
employees of an organization in return for the services rendered by them. Benefits refer to all
financial compensation that is not directly paid to the employees. The areas that legally require
dispensing of benefits include social security and medical compensation.

Services rendered by individuals to organizations have to be equitably paid for. This

compensation generally comprises cash payments which include wages, bonus and shared
profits. Good compensation plans have a salutary effect on the employees. They are happier in
their work, co-operative with management and productivity is up. Although, there can be both
monetary and non monetary forms of compensation, it is the monetary and non monetary forms
of compensation which is the most basic element by which individuals are attracted to an
organization and are persuaded to remain in the organization.

Wages in the widest sense mean any economy compensation paid by the employer under some
contract to his workers for the services rendered by them. Remuneration is composed of two
parts. They basic salary and allowances. The basic wage is the remuneration, which is paid or
payable to an employee in the terms of his contract of employment for the work done by him.

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Allowances are paid in addition to the basic wage to maintain the value of basic wages over a
period of time. Allowances include dearness allowance, bonus, overtime pay etc.

EMPLOYEE BENEFIT:
Definition: Employee benefits and services include any benefits that the employee receives in
addition to direct remuneration. A formal definition is…..
―..Fringes embrace a broad range of benefits and services that employees receive as part of their
total compensation package…pay or direct compensation….is based on critical job factors and
performance. Benefits and services, however, are indirect compensation because they are usually
extended as condition of employment and are not directly related to performance.‖

Employee benefits and services are alternatively known as fringes, service program me‘s,
employee benefits or hidden payroll.

COMPENSATION LAWS
There are many federal, state, and local employment and tax laws that impact compensation.
These laws define certain aspects of pay, influence how much pay a person may receive, and
shape general benefits plans.

The Fair Labor Standards Act (FLSA) is probably the most important piece of compensation
legislation. Small business owners should be thoroughly familiar with it. This act contains five
major compensation laws governing minimum wage, overtime pay, equal pay, recordkeeping
requirement, and child labor, and it has been amended on several occasions over the years. Most
of the regulations set out in the FLSA impact non-exempt employees, but this is not true across
the board.

The Equal Pay Act of 1963 is an amendment to FLSA, which prohibits differences in
compensation based on sex for men and women in the same workplace whose jobs are similar. It
does not prohibit seniority systems, merit systems, or systems that pay for performance, and it
does not consider exempt or non-exempt status.

In addition, the United States government has passed several other laws that have had an impact,
in one way or another, on compensation issues. These include the Consumer Credit Protection

5
Act of 1968 , which deals with wage garnishments; the Employee Retirement Income Security
Act of 1974 (ERISA ), which regulates pension programs; the Old Age, Survivors, Disability and
Health Insurance Program (OASDHI), which forms the basis for most benefits programs;
and implementation of unemployment insurance, equal employment, worker's comp, Social
Security, Medicare, and Medicaid programs and laws.

TRADITIONAL COMPENSATION

For the most part, traditional methods of compensation involve set pay levels (wage or salary)
with regular increases. Increases can be given for a variety of reasons, but are typically given for
promotions, merit increases, or cost of living increases. The Hay Group points out that there is
less distinction today between merit increases and cost of living increases: "Because of the low
levels (3 to 4 percent) of salary budget funding, most merit raises are perceived as little more
than cost of living increases. Employees have come to expect them." This "base pay" system is
one that most people are familiar with. Often, it includes a set salary or wage, a set schedule for
merit increases, and a set benefits package.

BENEFITS

Benefits are an important part of an employee's total compensation package. Benefits packages
became popular after World War II, when wage controls made it more difficult to give
competitive salaries. Benefits were added to monetary compensation to attract, retain, and
motivate employees, and they still perform that function today. They are not cash rewards, but
they do have monetary value (for example, spiraling health care costs make health benefits
particularly essential to today's families). Many of these benefits are nontaxable to the employee
and deductible by the employer.

Many benefits are not required by law, but are nonetheless common in total compensation
packages. These include health insurance, accidental death and dismemberment insurance, some
form of retirement plan (including profit-sharing, stock option programs, 401(k) and employee
stock ownership plans), vacation and holiday pay, and sick leave. Companies may also offer
various services, such as day care, to employees, either free or at a reduced cost. It is also
common to provide employees with discounted services or products offered by the company
itself. In addition, there are also certain benefits that are required by either state or federal law.

6
Federal law, for example, requires the employer to pay into Social Security, and unemployment
insurance is mandated under OASDHI. State laws govern worker's compensation.

CHANGES IN COMPENSATION SYSTEMS

As businesses change their focus, their approach to compensation must change as well.
Traditional compensation methods may hold a company back from adequately rewarding its best
workers. When compensation is tied to a base salary and a position, there is little flexibility in
the reward system. Some new compensation systems, on the other hand, focus on reward for
skills and performance, with the work force sharing in company profit or loss. One core belief of
new compensation policies is that as employees become employee owners, they are likely to
work harder to ensure the success of the company. Indeed, programs that promote employee
ownership—and thus employee responsibility and emotional investment—are becoming
increasingly popular. Examples of these types of programs include gain sharing, in which
employees earn bonuses by finding ways to save the company money; pay for knowledge, in
which compensation is based on job knowledge and skill rather than on position (and in which
employees can increase base pay by learning a variety of jobs); and incentive plans such as
employee stock options plans (ESOPs).

PAY FOR PERFORMANCE

Probably the most popular of the newer concepts in compensation is the easiest to understand—
compensation based on performance. These programs, sometimes referred to as variable pay
programs, generally offer compensation incentives based on employee performance or on the
performance of a team. Pay for performance rewards high performance and does not reward
mediocre or low performance, and is the definition of the "merit" system.

In a true merit based system, there are a few conditions which must be satisfied for it to be
meaningful:

 Employees must have control over their performance. If employees are overly dependent
on the actions and output of other employees or processes, they may have little control
over their own performance.

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  Differences in performance must mean something to the business. If there is little
difference between a high performer and a mediocre one, merit pay won't work.
 Performance must be measured regularly and reliably. A clear system of performance
appraisal, with defined criteria that are understood by the employee and regularly
scheduled meetings must be in place.

ADMINISTERING COMPENSATION PROGRAMS

Compensation programs and policies must be communicated clearly and thoroughly to

employees. Employees naturally want to have a clear understanding of what they can reasonably
expect in terms of compensation (both in terms of monetary compensation and benefits) and
performance appraisal. To ensure that this takes place, consultants urge business owners to detail
all aspects of their compensation programs in writing. Taking this step not only helps reassure
employees, but also provides the owner with additional legal protection from unfair labor
practices accusations.

8
SCOPE OF THE STUDY:
The scope of the study consists of analyzing the compensation and benefits given for the
employees at Dr. Reddy's Laboratories, An analysis of the process was carried out and
recommendations were given accordingly. A questionnaire survey was conducted among
Mangers, Executives, Supervisors and Workmen covering the following departments.
 HR department.
 General administration department.
 Packing department.
 Parenterals department.
 Engineering department.
 Production department.

9
OBJECTIVES OF THE STUDY

The study has been conducted to get an insight into the practices being followed in the various
industries with respect to the following:

 The purpose for which competency gap analysis is undertaken

 The procedure adopted for compensation benefits
 The step taken to bridge the identified through compensation benefits

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RESEARCH METHODOLOGY:
The research, method of study explains the systematic way of finding the predetermined
objectives. Moreover this provides the clean path to accomplish and achieve clear solution for
the problem stated. The following are stages through which the research has passed to obtain the
conclusions:

1. Research Design:
In this study, the research design used is descriptive in nature as it describes the views,
opinions and perception of the employees.

2. Collection of Data:
This study uses both primary and secondary data. Primary data refers to the first hand
information that is collected through questionnaire and on personal interviews. Secondary
data refers to the data that is not originally collected but rather obtained from published or
unpublished sources, i.e., information about the performance of the company, reports on the
study, review of literature etc.

METHODS OF DATA COLLECTION:

Questionnaire is prepared and circulated to the employees to know their opinion on the
―Manpower planning‖ in the organization. Questionnaire consists of close ended questions which
pre-specify all the answers and respondents make a choice among them. While collecting the
data, since women were not able to read the questionnaire personal interview was conducted by
translating the questionnaire into a language which is understandable by them to know about the
functions of human resources activities implemented in the organization.

3. Sample size:
The sample size selection for research is 30. This sample size was selected by using random
sampling technique.

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 4. Data Analysis:
After the data have been collected it has to be analyzed, the data obtained from the
questionnaire is arranged in a serial order. Then a copy with tabulation method is being
prepared.

Tabulation is a part of the technical procedure where in classified data are put in the form of
tables. The tables thus obtained were analyzed with statistical techniques like percentage, pie
diagrams.

STATISTICAL TOOLS USED:

Percentage Method:
Percentage method is used in making comparison between two or more series of data. This
method is used to describe relationship.

No. of respondents
%age of respondents = ___________________
Total respondents

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LIMITATIONS OF THE STUDY:
 The understanding and knowledge may vary from person to person. The replies given by
respondents are assumed to be true, though they are not uniform.
 The study in the organization is 45 days only.
 The limitations of performance appraisal can be applicable of the study.
 There may be working of the employees and taking the figures from the annual reports.
 The Study is conducted within the selected unit of Dr. Reddy's Laboratories, Hyderabad.
 The study was conducted with the data available and the analysis was made accordingly.

13
 CHAPTER - II

REVIEW OF LITERATURE

14
INTRODUCTION:

Benefits and Compensation are the two vital parts of employees what they get in return by the
service that they provide to their employers. It is necessary to know whether the employees
undervalue the cost of benefits that they are provided as an employer. I am strictly agree if
employee undervalues the cost of benefits as an employer we can cut their benefits and add
direct compensation.

COMPENSATION:

In each and every organization people work for to get something in return or they expect
something after completion of their work form employers. We must have heard a common
phrase: give and take. We must always things to people in exchange for what you give them.
Compensation refers to this Exchange, but in monetary terms. Compensation from the employer
an employee feedback for work. It's just the monetary value that employers exchange for their
employees with the services that employees provided.

Human Resource Management defines compensation in these words "employee compensation

refers to all forms of remuneration to workers and arising from their employment." The
expression ' all forms of remuneration "in the definition does not include any non-financial
benefits, but all the direct and indirect financial compensation.

BENEFITS:

Workers today are not prepared to work just for the money apart from money they expect some
other benefits. This is known as extra employee benefits. Also known as fringe benefits,
employee benefits are non-financial form of compensation offered in addition to cash salary to
employees to enrich life.

What benefits would the company offer to its employees? Problem arises when you begin to
decide what to give to whom and on what basis? Employee benefits are not performance-based,
they are membership-based. Workers receive benefits regardless of their performances.
Employee benefits as a whole have no direct influence on the performance of employee,
however, insufficient benefits contribute to the satisfaction of the low level and absenteeism and

15
turnover in workers increase. (De Cenzo and Robbins; 2007). So would you must carefully
design your benefit package. Your package contains a cell phone to each employee, with them to
a training workshop or seminar, giving them a day or two off every month and so on. While the
decision on the package of benefits, the associated costs.

A well-designed compensation and benefits plan helps attract motivate and retain talent in the
company. A well-designed compensation & benefits plan will benefit in the following ways.

1. Job satisfaction: your staff would be happy with their work and would like to work for you if
they honestly rewards in exchange for their services.

2. Motivation: We all have different types of needs. Some of us want money, so they work for
the company making them higher wages. Some value reach more than money, she would join
companies that have greater chances of promotion, learning and development. A compensation
plan that affects workers needs is more likely to give them the way you want to act to motivate.

3. Low absenteeism: why would anyone want to skip the day and watch favorite TV program at
the home, if someone really enjoy the work at the office or company's environment and satisfied
with their salaries and get what they want and need?

4. Low turnover: would someone or any staff want to work for other organization if your
company offers them fair rewards. The rewards which they thought they deserved.

DIRECT COMPENSATION

Direct compensation persuade to financial benefits offered and provided to workers in return of
the services that they provide to the Company. The financial benefits include Transportation,
leave travel allowance, medical allowance, rent of the house allowance, basic salary. They are
provided at an expected period at a definite time.

BASIC SALARY

Salary is that amount which is received by the employee after some task done by him/her for a
certain period of time that can be a day, a week, a month, etc. It is the wealth employees receive
from their company for which they are working by depiction their services.

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RENT ALLOWANCE

Some of the Organizations either provide accommodations to its employees who are from
different regions, state or country or they provide house rent allowances to its employees. This is
done in order to maintain social security and to provide motivation in their work.

TRANSPORTATION

Employer provides some transportation facilities to its employees. Some of the organization also
provides petrol allowance and other allowances also they provide their own transport services in
order to pick and drop to their employees before and after completion of their day to day task.
European Care Group England provides transportation allowance to its employees.

LEAVE TRAVEL ALLOWANCE

These types of allowances can be provided to preserve the best aptitude in the company.
Employees are provided allowances to visit the places that they want to visit with their family
members. These allowances determined according to the position hold by the employees. For
example Google has such compensation system in order to motivate their employees and to make
them innovative.

MEDICAL COMPENSATION

Most of the Organizations also provide medical reimbursement to their employees. The
employees are provided with medical claims for them and also their family members. These
types of claims include treatment bills compensation and health-insurances.

BONUS

Bonus is paid to the employees during festive seasons to motivate them and provide them the
social security. The bonus amount usually amounts to one month's salary of the employee.

17
SPECIAL ALLOWANCE

Special allowance stands for the allowance such as mobile allowances, overtime, food/meals
commissions, travel expenses, reduction in the interest loans; insurance etc are provided to
employees to provide them social security and motivate them which improve the organizational
productivity.

INDIRECT COMPENSATION

Indirect compensation refers to non-cash benefits offered to employees in the exchange of the
service provided by them to the organization. They include leave policy, overtime policy, car
policy, hospitalization, insurance, travel assistance limits, retirement benefits, vacation rentals.

LEAVING POLICY

It is the right of any employees to satisfactory number of leave during working with the
company. The companies provide for paid leaves, casual browse, medical leaves (sick leave),
statutory wage and maternity leaves.

OVERTIME POLICY

Employees shall with the sufficient allowances and facilities during their overtime, as he/she is
happened to do so, such as transport, overtime pay, etc.

HOSPITALIZATION

The employees must be provided compensation to get their regular check-ups, let's say at an
interval even their dependents, should be eligible for medi-claims that makes the employees
stimulated and more secure.

INSURANCE

Organizations also offer for accidental insurance and life insurance for employees. This gives
them the emotional security and they feel valued in the organization and it also make help them
to make more innovative.

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LET TRAVEL

The workers are equipped with leaves and travel expenses to go for holiday with their families.
Some organizations settle for a tour of the employees of the organization. This is usually done to
make the workers be stress free.

RETIREMENT BENEFITS

Organizations can provide for their employees in favor of them after they retire from the
organization on the prescribed age for retirement and other benefits.

HOLIDAY HOMES

Organizations offer for holiday homes and guest house for their employees in different locations.
These houses are usually found in hill station and other most sought after vacation spots. The
organizations ensure that employees are not facing any kind of difficulties during their stay at
Guesthouse.

Flexible timings

Organizations offer flexible timings to workers who can't come to work during normal shifts
thanks to their personal problems and valid reasons.

THE BASIC COMPONENTS OF EMPLOYEE COMPENSATION AND

BENEFITS

Employee compensation and benefits are divided into four basic categories:

1. Guaranteed pay – a fixed monetary (cash) reward paid by an employer to an employee. The
most common form of guaranteed pay is base salary.

2. Variable pay – a non-fixed monetary (cash) reward paid by an employer to an employee that is
contingent on discretion, performance, or results achieved. The most common forms of variable
pay are bonuses and incentives.

3. Benefits – programs an employer uses to supplement employees‘ compensation, such as paid

time off, medical insurance, company car, and more.

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4. Equity-based compensation – stock or pseudo stock programs an employer uses to provide
actual or perceived ownership in the company which ties an employee's compensation to the
long-term success of the company. The most common examples are stock options.

GUARANTEED PAY

Guaranteed pay is a fixed monetary (cash) reward.

The basic element of guaranteed pay is base salary which is paid on an hourly, daily, weekly, bi-
weekly or monthly rate. Base salary is typically used by employees for ongoing consumption.
Many countries dictate the minimum base salary defining a minimum wage. Employees'
individual skills and level of experience leave room for differentiating income levels within a
job-based pay structure.

In addition to base salary, there are other pay elements which are paid based solely on
employee/employer relations, such as salary and seniority allowance.

VARIABLE PAY

Variable pay is a non-fixed monetary (cash) reward that is contingent on discretion,

performance, or results achieved. There are different types of variable pay plans, such as bonus
schemes, sales incentives (commission), overtime pay, and more.

An example where this type of plan is prevalent is how the real estate industry compensates real
estate agents. A common variable pay plan might be the sales person receives 50% of every
dollar they bring in up to a level of revenue at which they then bump up to 85% for every dollar
they bring in going forward. Typically, this type of plan is based on an annual period of time
requiring a "resetting" each year back to the starting point of 50%. Sometimes this type of plan is
administered so the sales person never resets or falls down to a lower level. It also includes
Performance Linked Incentive which is variable and may range from 130% to 0% as per
performance of the individual as per his KRA.

BENEFITS

There is a wide variety of benefits offered to employees such as Paid Time-Off (PTO), various
types of insurance (such as life, medical, dental, and disability), participation in a retirement plan

20
(such as pension or 401(k)), or access to a company car, among others. Some benefits are
mandatory which are regulated by the government while others are voluntarily offered to fulfill
the need of a specific employee population. Benefit plans are typically not provided in cash but
form the basis of an employees' pay package along with base salary and bonus.

In the United States, "qualified" employee benefit plans must be offered to all employees, while
"non-qualified" benefit plans may be offered to a select group such as executives or other highly-
paid employees. When implementing a benefit plan, HR Departments must ensure compliance
with federal and state regulations. Many states and countries dictate different minimum benefits
such as minimum paid time-off, employer‘s pension contribution, sick pay, among others.

EQUITY-BASED COMPENSATION

Equity based compensation is an employer compensation plan using the employer‘s shares as
employee compensation. The most common form is stock options, yet employers use additional
vehicles such as restricted stock, restricted stock units (RSU), employee stock purchase
plan (ESPP), and stock appreciation rights (SAR).

EXTERNAL EQUITY
External equity refers to the similarity of the practices of other organization of the same sector. If
perceived like this, it can be said that the program is considered competitive or externally
equitable. Usually, these comparisons are done in external labor markets where the wages vary.
There are various factors that contribute to create these differences, for example, geographical
location, and education and work experience.

Internal equity

Internal equity is employees' perception of their duties, compensation, and work conditions as
compared with those of other employees in similar positions in the same organization. As this
comparison is always made within the company, problems with internal equity can result in
conflict among employees, mistrust, low morale, anger and even the adoption of legal actions.
Workers can make the evaluation of internal equity regarding two main points. On the one hand,
procedural justice is the person‘s perceived fairness of the process (assigned tasks) and
procedures used to make decisions about him/her. On the other hand, distributive justice refers to

21
the perceived fairness in the distribution of outcomes (salaries). The classic objectives of equity
based compensation plans are retention, attraction of new hires and aligning employees‘ and
shareholders‘ interests with the long-term success of the company.

ORGANIZATIONAL PLACE

In most companies, compensation & benefits (C&B) design and administration falls under the
umbrella of human-resources.

HR organizations in large companies are typically divided into three sub-divisions: HR business
partners (HRBPs), HR centers of excellence, and HR shared services. C&B is an HR center of
excellence, like staffing and organizational development (OD).

MAIN INFLUENCERS

Employee compensation and benefits main influencers can be divided into two: internal
(company) and external influencers.

The most important internal influencers are the business objectives, labor unions, internal equity
(the idea of compensating employees in similar jobs and similar performance in a similar
way), organizational culture and organizational structure.

The most important external influencers are the state of

the economy, inflation, unemployment rate, the relevant labor market, labor law, tax law, and the
relevant industry habits and trends.

BONUS PLANS BENEFITS

Bonus plans are variable pay plans. They have three classic objectives:

1. Adjust labor cost to financial results – the basic idea is to create a bonus plan where the
company is paying more bonuses in ‗good times‘ and less (or no) bonuses in ‗bad times‘. By
having bonus plan budget adjusted according to financial results, the company‘s labor cost is
automatically reduced when the company isn‘t doing so well, while good company performance
drives higher bonuses to employees.

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2. Drive employee performance – the basic idea is that if an employee knows that his/her bonus
depend on the occurrence of a specific event (or paid according to performance, or if a certain
goal is achieved), then the employee will do whatever he/she can to secure this event (or improve
their performance, or achieve the desired goal). In other words, the bonus is creating an incentive
to improve business performance (as defined through the bonus plan).

3. Employee retention – retention is not a primary objective of bonus plans, yet bonuses are
thought to bring value with employee retention as well, for three reasons:

a) A well designed bonus plan is paying more money to better performers; a competitor offering
a competing job-offer to these top performers is likely to face a higher hurdle, given that these
employees are already paid higher due to the bonus plan.

b) If the bonus is paid annually, employee is less inclined to leave the company before bonus
payout; often the reason for leaving (e.g. dispute with the manager, competing job offer) 'goes
away' by the time the bonus is paid. The bonus plan 'buy' more time for the company to retain the
employee.

c) Employees paid more are more satisfied with their job (all other things being equal) thus less
inclined to leave their employer.

The concept saying bonus plans can improve employee performance is based on the work
of Frederic Skinner, perhaps the most influential psychologist of the 20th century. Using the
concept of Operant Conditioning, Skinner claimed that an organism (animal, human being) is
shaping his/her voluntary behavior based on its extrinsic environmental consequences – i.e.
reinforcement or punishment.

This concept captured the hearts of many, and indeed most bonus plans nowadays are designed
based on it, yet since the late 1940s a growing body of empirical evidence has suggested that
these if-then rewards do not work in a variety of settings common to the modern workplace. The
failings of the bonus plan often relate to rewarding the wrong behavior. For example, managers
who keep to the status quo, fire valuable (expensive) employees, and engage in immoral business
practices can achieve better short-term financial outcomes (and therefore a bonus) than a
manager who is attempting to innovate his or her way to higher profits. When bonus plans are
poorly thought out, they have the potential to damage employee performance and cause

23
regulatory headaches. However, despite their failings, employees (and many employers) still
view an effective bonus plan as the single greatest motivator in the workplace.

24
 CHAPTER - III
INDUSTRY PROFILE
&
COMPANY PROFILE

25
 INDUSTRY PROFILE

INTRODUCTION

India is the largest provider of generic drugs globally. Indian pharmaceutical sector industry
supplies over 50 per cent of global demand for various vaccines, 40 per cent of generic demand
in the US and 25 per cent of all medicine in UK.

India enjoys an important position in the global pharmaceuticals sector. The country also has a
large pool of scientists and engineers who have the potential to steer the industry ahead to an
even higher level. Presently over 80 per cent of the antiretroviral drugs used globally to combat
AIDS (Acquired Immune Deficiency Syndrome) are supplied by Indian pharmaceutical firms.

The pharmaceutical industry discovers, develops, produces, and markets drugs or pharmaceutical
drugs for use as medications to be administered (or self-administered) to patients to cure them,
vaccinate them, or alleviates a symptom. Pharmaceutical companies may deal in generic or brand
medications and medical devices. They are subject to a variety of laws and regulations that
govern the patenting, testing, safety, efficacy and marketing of drugs.

The pharmaceutical industry in India ranks 3rd in the world terms of volume and 14th in terms of
value. According to Department of Pharmaceuticals, Ministry of Chemicals and Fertilizers, the
total turnover of India's pharmaceuticals industry between 2008 and September 2009 was
US$21.04 billion. Hyderabad, Mumbai, Bangalore and Ahmadabad are the major pharmaceutical
hubs of India. The domestic market was worth US$13.8 billion in 2013.

The Government started to encourage the growth of drug manufacturing by Indian companies in
the early 1960s, and with the Patents Act in 1970. However, economic liberalization in 90s by
the former Prime Minister P.V. Narasimha Rao and the then Finance Minister, Dr. Manmohan
Singh enabled the industry to become what it is today. This patent act removed composition
patents from food and drugs, and though it kept process patents, these were shortened to a period
of five to seven years.

26
The Lack of patent protection made the Indian market undesirable to the multinational
companies that had dominated the market. Whilst the multinationals streamed out, Indian
companies carved a niche in both the Indian and world markets with their expertise in reverse-
engineering new processes for manufacturing drugs at low costs. Although some of the larger
companies have taken baby steps towards drug innovation, the industry as a whole has been
following this business model until the present.

India's biopharmaceutical industry clocked a 17 percent growth with revenues of Rs.137 billion
($3 billion) in the 2009-10 financial year over the previous fiscal. Bio-pharma was the biggest
contributor generating 60 percent of the industry's growth at Rs.8,829 crore, followed by bio-
services at Rs.2,639 crore and bio-agri at Rs.1,936 crore.

Overview

In 2002, over 20,000 registered drug manufacturers in India sold $9 billion worth of formulations
and bulk drugs. 85% of these formulations were sold in India while over 60% of the bulk drugs
were exported, mostly to the United States and Russia. Most of the players in the market are
small-to-medium enterprises; 250 of the largest companies control 70% of the Indian market.
Thanks to the 1970 Patent Act, multinationals represent [when?] only 35% of the market, down
from 70% thirty years ago.

Most pharma companies operating in India, even the multinationals, employ Indians almost
exclusively from the lowest ranks to high level management. [Citation needed] Home-grown
pharmaceuticals, like many other businesses in India, are often a mix of public and private
enterprise.

In terms of the global market, India currently holds a modest 1–2% share, but it has been
growing at approximately 10% per year. India gained its foothold on the global scene with its
innovatively engineered generic drugs and active pharmaceutical ingredients (API), and it is now
seeking to become a major player in outsourced clinical research as well as contract
manufacturing and research. </ref>Indian companies received 304 Abbreviated New Drug
Application (ANDA) approvals from the US Food and Drug Administration (USFDA) in 2017.
The country accounts for around 30 per cent (by volume) and about 10 per cent (value) in the

27
US$ 70-80 billion US generics market. Growth in other fields notwithstanding, generics is still a
large part of the picture. India is the largest provider of generic drugs globally. Indian
pharmaceutical sector industry supplies over 50 per cent of global demand for various vaccines,
40 per cent of generic demand in the US and 25 per cent of all medicine in UK.

Market Size:

The pharmaceutical sector was valued at US$ 33 billion in 2017. The country‘s pharmaceutical
industry is expected to expand at a CAGR of 22.4 per cent over 2015–20 to reach US$ 55 billion.
India‘s pharmaceutical exports stood at US$ 17.27 billion in FY18 and have reached US$ 10.80
billion in FY19 (up to October 2018). Pharmaceutical exports include bulk drugs, intermediates,
drug formulations, biological, Ayush & herbal products and surgicals.

Indian companies received 304 Abbreviated New Drug Application (ANDA) approvals from the
US Food and Drug Administration (USFDA) in 2017. The country accounts for around 30 per
cent (by volume) and about 10 per cent (value) in the US$ 70-80 billion US generics market.

India's biotechnology industry comprising bio-pharmaceuticals, bio-services, bio-agriculture,

bio-industry and bioinformatics is expected grow at an average growth rate of around 30 per cent
a year and reach US$ 100 billion by 2025.

Investments and Recent Developments:

The Union Cabinet has given its nod for the amendment of the existing Foreign Direct
Investment (FDI) policy in the pharmaceutical sector in order to allow FDI up to 100 per cent
under the automatic route for manufacturing of medical devices subject to certain conditions.

The drugs and pharmaceuticals sector attracted cumulative FDI inflows worth US$ 15.83 billion
between April 2000 and June 2018, according to data released by the Department of Industrial
Policy and Promotion (DIPP).

Some of the recent developments/investments in the Indian pharmaceutical sector are as follows:

28
Between Jul-Sep 2018, Indian pharma sector witnessed 39 PE investment deals worth US$ 217
million.

Investment (as % of sales) in research & development by Indian pharma companies* increased
from 5.3 per cent in FY12 to 8.5 per cent in FY18.

In 2017, Indian pharmaceutical sector witnessed 46 merger & acquisition (M&A) deals worth
US$ 1.47 billion

The exports of Indian pharmaceutical industry to the US will get a boost, as branded drugs worth
US$ 55 billion will become off-patent during 2017-2019.

Government Initiatives:

Some of the initiatives taken by the government to promote the pharmaceutical sector in India
are as follows:

In October 2018, the Uttar Pradesh Government announced that it will set up six pharma parks in
the state and has received investment commitments of more than Rs 5,000-6,000 crore (US$
712-855 million) for the same.

The National Health Protection Scheme is largest government funded healthcare programme in
the world, which is expected to benefit 100 million poor families in the country by providing a
cover of up to Rs 5 lakh (US$ 7,723.2) per family per year for secondary and tertiary care
hospitalisation. The programme was announced in Union Budget 2018-19.

In March 2018, the Drug Controller General of India (DCGI) announced its plans to start a
single-window facility to provide consents, approvals and other information. The move is aimed
at giving a push to the Make in India initiative.

The Government of India is planning to set up an electronic platform to regulate online

pharmacies under a new policy, in order to stop any misuse due to easy availability.

29
The Government of India unveiled 'Pharma Vision 2020' aimed at making India a global leader
in end-to-end drug manufacture. Approval time for new facilities has been reduced to boost
investments.

The government introduced mechanisms such as the Drug Price Control Order and the National
Pharmaceutical Pricing Authority to deal with the issue of affordability and availability of
medicines.

Road Ahead:

Medicine spending in India is projected to grow 9-12 per cent over the next five years, leading
India to become one of the top 10 countries in terms of medicine spending.

Going forward, better growth in domestic sales would also depend on the ability of companies to
align their product portfolio towards chronic therapies for diseases such as such as
cardiovascular, anti-diabetes, anti-depressants and anti-cancers that are on the rise.

The Indian government has taken many steps to reduce costs and bring down healthcare
expenses. Speedy introduction of generic drugs into the market has remained in focus and is
expected to benefit the Indian pharmaceutical companies. In addition, the thrust on rural health
programmes, lifesaving drugs and preventive vaccines also augurs well for the pharmaceutical
companies.

Reports:

Indian pharmaceutical sector industry supplies over 50 per cent of global demand for various
vaccines, 40 per cent of generic demand in the US and 25 per cent of all medicine in UK. India
contributes the second largest share of pharmaceutical and biotech workforce in the world. The
pharmaceutical sector in India was valued at US$ 33 billion in 2017. In Jul-Sep 2018, Indian
pharmaceutical market grew 9.7 per cent and stood at Rs 1.26 trillion (US$ 17.95 billion) for the
Moving Annual Total (MAT) ended September. In November 2018, the Indian market grew by
6.3 per cent year-on-year.

30
With 71 per cent market share, generic drugs form the largest segment of the Indian
pharmaceutical sector. Domestic API consumption is expected to reach US$ 18.8 billion by
FY22. The country accounts for the second largest number of Abbreviated New Drug
Applications (ANDAs) and is the world‘s leader in Drug Master Files (DMFs) applications with
the US Indian Drugs & Pharmaceuticals sector has received cumulative FDI worth US$ 15.83
billion between April 2000 and June 2018.

Indian drugs are exported to more than 200 countries in the world, with the US as the key
market. Generic drugs account for 20 per cent of global exports in terms of volume, making the
country the largest provider of generic medicines globally and expected to expand even further in
coming years. India‘s pharmaceutical exports stood at US$ 17.27 billion in FY18 and US$ 10.80
billion in FY19 (up to October). In 2018-19, these exports are expected to cross US$ 19 billion.
31 per cent of these exports from India went to the US.

The Government of India plans to set up a US$ 640 million venture capital fund to boost drug
discovery and strengthen pharmaceutical infrastructure. The ‗Pharma Vision 2020‘ by the
government‘s Department of Pharmaceuticals aims to make India a major hub for end-to-end
drug discovery.

Quality

Between 2015 and 2017, there were 31 FDA warning letters to Indian pharmaceutical companies
citing serious Data Integrity issues, including data deletion, manipulation or fabrication of test
results, see ―An Analysis Of 2017 FDA Warning Letters On Data Integrity‖ By Barbara Unger,
Unger Consulting Inc. According to Outsourcing Pharma in 2012 75% of counterfeit drugs
supplied world over had some origins in India, followed by 7% from Egypt and 6% from China.

The Central Drug Standards Control Organisation (CDSCO), the drug regulatory authority of
India conducted a nationwide survey in 2009 and announced that of "24,000 samples [that] were
collected from all over India and tested. It was found that only 11 samples or 0.046% were
spurious." In 2017 a similar survey found 3.16% of the medicines sampled were substandard
and 0.0245% was fake. Those more commonly prescribed are probably more often faked.

31
Exports

Exports of pharmaceuticals products from India increased from US$6.23 billion in 2006-07 to
US$8.7 billion in 2008-09 a combined annual growth rate of 21.25%. Some of the major
pharmaceutical firms include Sun Pharmaceutical, Cadila Healthcare and Piramal Enterprises.

India exported $11.7 billion worth of pharmaceuticals in 2014.Pharmaceutical export from India
stood at US$ 17.27 billion in 2017-18, and is expected to grow by 30 per cent to reach US$ 20
billion by the year 2020. The 10 countries below imported 56.5% of that total:

Rank Country Value (US$) Share

1 United States $3.8 billion 32.9%
2 South Africa $461.1 million 3.9%
3 Russia $447.9 million 3.8%
4 United Kingdom $444.9 million 3.8%
5 Nigeria $385.4 million 3.3%
6 Kenya $233.9 million 2%
7 Tanzania $225.2 million 1.9%
8 Brazil $212.7 million 1.8%
9 Australia $182.1 million 1.6%
10 Germany $178.8 million 1.5%

Government support
The Indian government established the Department of Biotechnology in 1986 under the Ministry
of Science and Technology. Since then, there have been a number of dispensations offered by
both the central government and various states to encourage the growth of the industry. India‘s
science minister launched a program that provides tax incentives and grants for biotech start-ups
and firms seeking to expand and establishes the Biotechnology Parks Society of India to support
ten biotech parks by 2010. Previously limited to rodents, animal testing was expanded to include
large animals as part of the minister‘s initiative. States have started to vie with one another for
biotech business, and they are offering such goodies as exemption from VAT and other fees,

32
financial assistance with patents and subsidies on everything ranging from investment to land to
utilities.

The biotechnology sector faces some major challenges in its quest for growth. Chief among them
is a lack of funding, particularly for firms that are just starting out. The most likely sources of
funds are government grants and venture capital, which is a relatively young industry in India.
Government grants are difficult to secure, and due to the expensive and uncertain nature of
biotech research, venture capitalists are reluctant to invest in firms that have not yet developed a
commercially viable product.

The government has addressed the problem of educated but unqualified candidates in its Draft
National Biotech Development Strategy. This plan included a proposal to create a National Task
Force that will work with the biotech industry to revise the curriculum for undergraduate and
graduate study in life sciences and biotechnology. The government‘s strategy also stated
intentions to increase the number of PhD Fellowships awarded by the Department of
Biotechnology to 200 per year. These human resources will be further leveraged with a "Bio-
Edu-Grid" that will knit together the resources of the academic and scientific industrial
communities, much as they are in the US.

Foreign investment
An initiative passed earlier this year [when?] allowed 100% foreign direct investments in the
biotech sector without compulsory licensing from the government.

33
 COMPANY PROFILE
Dr. Reddy’s Laboratories:

The company was incorporated by Dr. Anji Reddy in 1984

over the years. DRL (Dr. Reddy‘s Lab) has successfully
transformed itself from a reverse engineering and bulk drug
company to a research driven, formulation based
pharmaceutical company. The company has a major presence
in anti-infective, gastro-intentional, pain management and
cardiovascular therapeutic segment.

Currently six of its brands are among the top 300-pharma

brands in the country. DRL is among the fastest growing companies in the domestic
formulations market and is set to emerge as the third largest pharmaceutical company behind
Glaxo and Ranbaxy after its merger with Cheminor Drugs and American Remedies.

DRL has transformed itself from process engineering and research driven pharmaceutical
company in the past 6 years. The company achieved serval landmarks in 2001 with its ADR
issues, launch of generic Flexitime in the US and licenser of anti diabetic molecule to Novartis.

DR.ANJI REDDY:

Dr. Reddy‘s Laboratories was founded by Dr Anji Reddy, an entrepreneur-scientist, in 1984.

The DNA of the company is drawn from its founder and his vision to establish India‘s first
discovery led global pharmaceutical company. In fact, it is this spirit of entrepreneurship that has
shaped the company to become what it is today.

Dr Anji Reddy, having moved out of Standard Organics Limited, a company he had successfully
co-founded, started Dr. Reddy‘s Laboratories with $ 40,000 in cash and $120,000 in bank loan!
Today, the company with revenues of Rs.1947 crore (US $446 million), as of fiscal year 2005, is
India‘s second largest pharmaceutical company and the youngest among its peer group.

Dr. Anji Reddy is well known for his passion for research and drug discovery. Dr. Reddy‘s
started its drug discovery programme in 1993 and within three years it achieved its first

34
breakthrough by out licensing an anti-diabetes molecule to Novo Nordisk in March 1997. With
this very small but significant step, the Indian industry went through a paradigm shift in its
image from being known as just ‗copycats‘ to ‗innovators‘! Through its success, Dr. Reddy‘s
pioneered drug discovery in India.

There are several such inflection points in the company‘s evolution from a bulk drug (API)
manufacturer into a vertically integrated global pharmaceutical company today. Today, the
company manufactures and markets API (Bulk Actives), Finished Dosages and Biologics in
over 100 countries worldwide, in addition to having a very Promising Drug Discovery Pipeline.

Dr. Reddy‘s started its first big move in 1986 from manufacturing and marketing bulk actives to
the domestic (Indian) market to manufacturing and exporting difficult-to-manufacture bulk
actives such as Methyldopa to highly regulated overseas markets.

Today, the Indian pharma industry, in stark contrast, is known globally for its proven high
quality-low cost advantage in delivering safe and effective pharmaceuticals. This transition, a
tough and often-perilous one, was made possible thanks to the pioneering efforts of companies
such as Dr. Reddy‘s Laboratories.

Today, Dr. Reddy‘s continues its journey. Leveraging on its ‗Low Cost, High Intellect‘
advantage. For going into new markets and new businesses. Taking on new challenges and
growing stronger and more capable. Each failure and each success renewing the sense of
purpose and helping the company evolve.

With over 950 scientists working across the globe, around the clock, the company continues its
relentless march forward to discover and deliver a breakthrough medicine to address an unmet
medical need and make a difference to peoples‘ lives worldwide. And when it does that, it would
only be the beginning and yet it would be the most important step. As Lao Tzu wrote a long time
ago, ‗Even a 1000 mile journey starts with a single step‘.

Currently DRL manufactures over 100 bulk actives and several key intermediates at their six
bulk actives facilities, all of which are CGMP – complaint and USFDA inspected. All the
activities are carried out in-house, supported by the indigenous strengths in analysis, testing,
organic synthesis, process development, and a controlled supply chain.

35
Mission Statement:

Dr Reddy‘s foundation believes in the interest motivation and capacity of the human being for
progress, given the right environment.

Vision:

To become a discovery led global pharmaceutical company.

Values:

DRL is a value driven organization with a strong focus on the following elements:
 Quality: DRL is dedicated to achieve the highest level of quality in everything it does to
delight its customers.
 Innovation & continuous learning: The Company provides an environment of innovation
and learning that fosters, in every employee, a desire to excel and willingness to
experiment.
 Collaboration &Teamwork: They seek opportunities to build relationship and leverage
knowledge, expertise and resources to create greater value across functions, business, and
locations.
 Truth & Integrity: Its business practices are guided by the highest ethical standards of
truth, integrity, and transparency.
 Respect for the Individuals: DRL tries to bring out the best in individuals by valuing
diversity and nurturing team spirit, individual development, and self-esteem.
 Harmony & Social Responsibility: They take utmost care to protect their natural environment
and serve the communities in which they live and work.

BOARD OF DIRECTORS
Whole Time Directors
DR. K.Anji reddy-Chairmen
G. V. Prasad- Vice Chairmen and CEO
Satish Reddy- Chief Operating Officer

36
Independent and non whole time directors
DR. Omkar Gowsawmi
P.n. Devarajan
Ravi Bhootalingam
P.Satyanarayana Rao
Dr. v. Mohan
Dr. Krishna G. palepu
Anupam puri

DR. REDDY’S STRATEGIC BUSINESS UNITS

1. Branded Finished dosages

2. Generic finished dosage
3. Bulk actives
4. Custom chemicals
5. Bio-technology
6. Diagnostics
7. Critical care
8. Discovery research

BRANDED FINISHED DOSAGES

Dr. Reddy‘s has a leading presence in India and the world market for value-added branded
finished dosages. They over the years acquired a strong reputation for their quality branded
formulations. Their state – of-the – art R & D facilities develop formulations and prepare bio-
batches and finished dosages in line with global regulatory requirements. This has helped them
carve a niche for themselves in the world market. Dr. Reddy‘s international operation spans
Asia, Africa, and Latin America.

With the help of joint-ventures, Dr. Reddy‘s have become one of the leading Indian
pharmaceutical companies in Russia, CIS Counties, Latin America, Africa, and China. They
have also entered into developing markets like Myanmar, Sri Lanka, Vietnam, Kenya, Trinidad,
and Malaysia, amongst others. Brazil and China are their focus markets in this millennium.

37
GENERIC FINISHED DOSAGE

Innovative products worth US$ 60 billion are likely to go off patent in the next 8-10 years in the
regulated markets. Dr. Reddy‘s recognized this opportunity for further expansion. Dr. Reddy‘s
Generic Finished Dosages business, operational since 1998, will target over 60% of the Drugs
going off patent from 2002-2008. Their pipeline of Generic Finished Dosages, backed by State-
of-the-art infrastructure and top-quality professionals makes this a viable proposition.

BULK ACTIVES

The bulk Actives business caters to the needs of both Innovators & generic Formulators
worldwide. Dr. Reddy‘s manufactures about 100 bulk actives and several key intermediates. Dr.
Reddy‘s have 6 bulk actives manufacturing facilities, which are CGMP approved and USFDA
inspected.

CUSTOM CHEMICALS

Their Custom Chemical serves (CCS) business unit caters to the following needs of
pharmaceutical companies that wish to outsource their requirement.
 CONTRACT RESEARCH
 CUSTOMER SYNTHESIS
 CONTRACT MANUFACTURING

BIOTECHNOLOGY

Dr. Reddy‘s Biotechnology division deals with therapeutics, vaccines and diagnostics,
Molecular biology, cell culture fermentation, downstream processing and hybridism technology
are the focus areas. Dr. Reddy‘s is the first company in India to develop a molecule from the
molecular biology stage to production.

Dr. Reddy‘s identified bio-generics as a significant market area; they are in the process of
setting up bulk recombinant protein production sites and formulation facilities that meet USFDA
specifications Dr. Reddy‘s have a pipeline comprising of several recombinant proteins in various
phases of development for treatment of cancer, diabetes and cardiovascular diseases

38
 CHAPTER- IV
DATA ANALYSIS
AND
INTERPRETATION

39
 DATA ANALYSIS AND INTERPRETATION

Table 1:
Showing the gender group of respondents

Gender No. of Respondents Percentage

Male 27 54%
Female 23 46%
Total 50 100%

INTERPRETATION:

From the above table

 54% of the respondents are males
 46% of the respondents are females.

Chart to show the gender group of respondents

No. of Respondents
Percentage

40
Table 2:
Showing the age group of the respondents
Age No. of Respondents Percentage
20-25 3 6%
25-30 15 30%
30-40 12 24%
Above 40 20 40%
Total 50 100%

INTERPRETATION:

From the above table

 6% of the respondents are below 25 years.
 30% of the respondents are between 25 to 30 years.
 24% of the respondents are between 30 to 40 years.
 40% of the respondents are above 40 years.

Chart showing the age group of respondents

No. of Respondents
Percentage

41
Table 3:
Duration of service in Dr. Reddy's Laboratories,

Service No. of Respondents Percentage

Below 1 year 7 14%
Below 5 years 11 22%
Above 5 years 32 64%
Total 50 100%

INTERPRETATION:
From the above table
 14% of the respondents are having service below 1 year.
 22% of the respondents are having service below 5 year.
 64% of the respondents are having service above 5 year.

Chart showing duration of service in Dr. Reddy's Laboratories,

No. of Respondents
Percentage

42
Table 4:
Which of the following is the best department according to you?

Department No. of respondents Percentage

Finance/Accounting 6 24%
Human Resources 9 36%
Sales/Marketing 10 40%
Total 25 100%

Chart 4:

No. of respondents

Finance/Accounting
Human Resources
Sales/Marketing
Total

INTERPRETATION:
 24% of the respondents feels finance/accounting is the best department.
 36% of the respondents feels human resources is the best department.
 40% of the respondents feels sales/marketing is the best department.

43
Table 5:
I receive enough opportunity to interact with other employees.
Satisfaction level No. of respondents Percentage
Strongly Agree 12 48%
Agree 10 40%
Disagree 2 8%
Strongly Disagree 1 4%
Total 25 100%

Chart 5:

No. of respondents
Strongly Agree
Agree
Disagree
Strongly Disagree
Total

INTERPRETATION:
 48% of the employee strongly agree that they have enough opportunity to interact
with other employees.
 40% of the employee agree that they have enough opportunity to interact with other
employees.
 8% of the employee disagree that they have enough opportunity to interact with
other employees.
 4% of the employee strongly disagree that they have enough opportunity to
interact with other employees.

44
Table 6:
I have enough freedom in my position to take independent action when needed.
Satisfaction level No. of respondents Percentage
Strongly Agree 5 20%
Agree 16 64%
Disagree 2 8%
Strongly Disagree 2 8%
Total 25 100%

Chart 6:

No. of respondents

Strongly Agree
Agree
Disagree
Strongly Disagree
Total

INTERPRETATION:
 20% of the employee strongly agree that they have enough freedom in their position
to take independent action when needed.
 64% of the employee agree that they have enough freedom in their position to take
independent action when needed.
 8% of the employee disagree that they have enough freedom in their position to
take independent action when needed.
 8% of the employee strongly disagree that they have enough freedom in their
position to take independent action when needed.

45
Table 7:
Overall how satisfied are you with your position at this company?

Satisfaction level No. of respondents Percentage

Very Satisfied 7 28%
Satisfied 14 56%
Dissatisfied 2 8%
Somewhat satisfied 2 8%
Total 25 100%

Chart 7:

No. of respondents

Very Satisfied
Satisfied
Dissatisfied
Somewhat satisfied
Total

INTERPRETATION:
 28% of the employee are very satisfied with their position in the company.
 56% of the employee are satisfied with their position in the company.
 8% of the employee are dissatisfied with their position in the company.
 8% of the employee are somewhat satisfied with their position in the company.

46
Table 8:
Do you feel employees are recognized as individuals?
No. of respondents Percentage
Always 8 32%
Usually 9 36%
Sometimes 5 20%
Never 3 12%
Total 25 100%

Chart 8:

No. of respondents

Always
Usually
Sometimes
Never
Total

INTERPRETATION:
 32% of the employee feel that employee are always recognized as individual in the
company.
 36% of the employee feel that employee are usually recognized as individual in the
company.
 20% of the employee feel that employee are sometimes recognized as individual in
the company
 12% of the employee feel that employee are never recognized as individual in the
company

47
Table9
How do you feel about the bonus received?
No. of respondents Percentage
Good 4 16%
Better 18 72%
Best 3 12%
Total 25 100%

Chart 9:

No. of respondents

Good
Better
Best

INTERPRETATION:

 16% of the employee feel good about the bonus received.

 72% of the employee feel better about the bonus received.
 12% of the employee feel best about the bonus received.

48
Table 10:
Do wage incentives are installed after due consultation with the workers?
No. of respondents Percentage
Yes 4 16%
No 16 64%
To an extent 5 20%
Total 25 100%

Chart 10:

No. of respondents

Yes
No
To an extent

INTERPRETATION:

 16% of the employee feel wage incentives are installed after due consultation with
the workers.
 64 % of the employee feel wage incentives are not installed after due consultation
with the workers.
 20% of the employee feel wage incentives are installed to an extent after due
consultation with the workers

49
Table 11:
Wage incentives in your organization are provided equally to all the employees
irrespective of grade?
No. of respondents Percentage
Yes 7 28%
No 18 72%
Total 25 100%

Chart 11:

No. of respondents

Yes
No
Total

INTERPRETATION:

 28% of the employee feel wage incentives are provided equally to all the
employees irrespective of grade.
 72% of the employee feel wage incentives are not provided equally to all the
employees irrespective of grade

50
Table 12:

Do you have a sound knowledge in the recent wage package?

No. of respondents Percentage

Yes 17 68%
No 4 16%
To an extent 4 16%
Total 25 100%

Chart 12:

No. of respondents

Yes
No
To an extent
Total

INTERPRETATION:
 68% of the employee have sound knowledge in the recent wage package.
 16% of the employee do not have sound knowledge in the recent wage package.
 16% of the employee to an extent have sound knowledge in the recent wage
package.

51
Table 13:
Do you agree at your company is maintaining good increment policy?
No. of respondents Percentage
Strongly Agree 8 32%
Agree 17 68%
Disagree 0 0
Strongly Disagree 0 0
Total 25 100%

Chart 13:

No. of respondents

Strongly Agree
Agree
Disagree
Strongly Disagree
Total

INTERPRETATION:
 32% of the employee strongly agree that company is maintaining good
increment policy.
 68% of the employee agree that company is maintaining good increment
policy.
 0% of the employee disagree that company is maintaining good increment
policy.

52
 CHAPTER V

FINDINGS

SUGGESTIONS

CONCLUSION

53
 FINDINGS
 48% of the employee strongly agree that they have enough opportunity to interact with
other employees.
 40% of the employee agree that they have enough opportunity to interact with other
employees.
 8% of the employee disagree that they have enough opportunity to interact with other
employees.
 4% of the employee strongly disagree that they have enough opportunity to interact with
other employees.
 20% of the employee strongly agree that they have enough freedom in their position to
take independent action when needed.
 64% of the employee agrees that they have enough freedom in their position to take
independent action when needed.
 8% of the employee disagree that they have enough freedom in their position to take
independent action when needed.
 8% of the employee strongly disagree that they have enough freedom in their position to
take independent action when needed.
 28% of the employees are very satisfied with their position in the company.
 56% of the employees are satisfied with their position in the company.
 8% of the employees are dissatisfied with their position in the company.
 8% of the employees are somewhat satisfied with their position in the company.
 32% of the employee feel that employee are always recognized as individual in the
company.
 36% of the employee feel that employee are usually recognized as individual in the
company.
 20% of the employee feel that employee are sometimes recognized as individual in the
company
 12% of the employee feel that employee are never recognized as individual in the
company

54
 16% of the employee feel wage incentives are installed after due consultation with the
workers.
 64 % of the employee feel wage incentives are not installed after due consultation with
the workers.
 20% of the employee feel wage incentives are installed to an extent after due consultation
with the workers
 28% of the employee feel wage incentives are provided equally to all the employees
irrespective of grade.
 72% of the employee feel wage incentives are not provided equally to all the employees
irrespective of grade
 68% of the employee have sound knowledge in the recent wage package.
 16% of the employee do not have sound knowledge in the recent wage package.
 16% of the employee to an extent have sound knowledge in the recent wage package.
 32% of the employee strongly agree that company is maintaining good increment policy.
 68% of the employee agree that company is maintaining good increment policy.
 0% of the employee disagree that company is maintaining good increment policy.

55
 SUGGESTIONS:
An effective employee compensation framework is significant towards enhancing motivation
level of the employees of an organization. Stock options and post retirement benefits are some of
the components of the employee compensation framework.

Workers' Compensation laws are designed to protect employees who are hurt on the job. These
employees are provided with fixed monetary awards covered under workers compensation, thus
eliminating the need for excessive litigation.

If an employee is injured, the employee files a claim with the workers compensation insurance
company. Most laws require that you file a claim within 30 days of the accident, or 30 days after
you learn of the injury (if it is a continuous, latent injury, such as an inability to breath).

In general, workers compensation provides replacement income, medical expenses, and

vocational rehabilitation benefits. Usually, workers compensation will pay you two-thirds of
your salary while you are injured. You may also be eligible for life-long benefits or a lump sum
payment if you are permanently hurt while on the job.

56
 CONCLUSIONS

 As per the survey,it is kow that 54% of the respondents were males and 46% of the
respondents were females.

 Most of the respondents were above 40 years in age.

 64% of the respondents have more than 5 years of experience in the company.

 Most of the employees are satisfied with the company but not satisfied with the benefits
provided by the company.

 Majority of the respondents are satisfied with their position in the company.

 Most of the employees are satisfied with the salary structure.

 48% of the employees feel that they have clear path for career advancement.

57
 BIBLIOGRAPHY

Books referred:

1. Human resource and personnel management

By Aswarthappa.
2. Human resource management
Himalaya publishing house
3. Human resource management and human relations.
By V.P. Michel
4. Gunkel, M. (2006). International Management Studies. Country Compatible Incentive
Design: a Comparison of Employee's Performance Reward Preferences in Germany and the
USA. Wiesbaden: DUV.
5. Javitich, A. (2004). Motivating Employees. Retrieved on November 24, 2010 from
http://www.javitch.com/Q/004.pdf
6. Mathis, R.L., & Jackson, J.H. (2008). Human Resource Management. 12th Ed. Ohio:
Thomson Inc.
7. McNamara, C. Basics about Employee Motivation (Including Steps you can take). Retrieved
on November 24, 2010 from http://managementhelp.org/guiding/motivate/basics.htm
8. Podmoroff, D. (2005). 365 Ways to Motivate and Reward your Employees Ever Day-With
Little or No Money. Florida : Atlantic Publishing Group, Inc.

WEBSITES:
1. www.drreddy.com
2. www.networksindia.com
3. www.ask.com
4. www.google.com
5. www.citehr.com

58
 QUESTIONNAIRE FOR EXECUTIVES

I request you to kindly spare a few minutes to fill up this questionnaire, which would help me to
accomplish my project work on Compensation and Benefits.

PERSONAL INFORMATION:
Name: ______________________________

Gender: Male Female

Age: 20 - 25
25 - 30
30 - 40
above 40

Qualification: _______________________

Present:
Department:____________________
Designation: ____________________

What has been your duration of service with Dr. Reddy's Laboratories, _________________

1. Which of the following is the best department according to you?

Finance/Accounting
Human Resources
Sales/Marketing

59
 None of the above

3.I receive enough opportunity to interact with other employees.

Strongly agree

Agree

Disagree

Strongly disagree

2. I have enough freedom in my position to take independent action when needed.

Strongly agree

Agree

Disagree

Strongly disagree

3. Overall how satisfied are you with your position at this company?

very Satisfied
Satisfied
Dissatisfied
somewhat satisfied

4. Do you feel employees are recognized as individuals?

Always

60
 Usually
Sometimes
Never

5. How motivated are u to see the company succeed?

Very motivated

Somewhat motivated

Not very motivated

Not at all motivated

6. Would you refer a friend to apply for a job at this company?

Definitely
Probably
Definitely not
Probably not

7. I have a clear path for career advancement?

Strongly agree

Agree

Disagree

Strongly disagree

61
 8. My job requirements are clear.

Strongly agree

Agree

Disagree

Strongly disagree
Tick in the appropriate box.
Satisfactory Not Satisfactory

1. Basic

2. House Rent Allowance

3. Conveyance Allowance

4. Paper Allowance

5. Canteen

6. Quarter rent

7. Reimbursement

8. Medical reimbursement

62
 QUESTIONNAIRE FOR WORKMEN

I request you to kindly spare a few minutes to fill up this questionnaire, which would help me to
accomplish my project work on Compensation and Benefits.

PERSONAL INFORMATION:
Name: ______________________________

Gender: Male Female

Age: 20 - 25
25 - 30
30 - 40
above 40
Qualification: _______________________
Present:
Department:____________________
Designation: ____________________

What has been your duration of service with Dr. Reddy's Laboratories, _________________
How do you feel about the bonus received?

Good

Better

Best
1. Do wage incentives are installed after due consultation with the workers?

Yes

No

To an extent

63
2. Wage incentives in your organization are provided equally to all the employees
irrespective of grade?

Yes

No
3. Do you have a sound knowledge in the recent wage package?

Yes

No

To an extent
4. Do you agree that your company is maintaining good increment policy?

Strongly agree

Agree

Disagree

Strongly disagree
5. Do you agree that the company should improve the existing welfare schemes?

Strongly agree

Agree

Disagree

Strongly disagree
6. I receive enough opportunity to interact with other employees on a formal level.

Strongly agree

Agree

64
 Disagree

Strongly disagree
7.Benefits given in the organization are good.

Strongly agree

Agree

Disagree

Strongly disagree
8. ―The wage increments are based on the performance of workmen‖-Do you agree
with this statement?

Strongly agree

Agree

Disagree

Strongly disagree
9. What is the percentage of bonus you receive?

8.33%

12%

16.66%

20%

65
Tick in the appropriate box

Satisfactory Not Satisfactory

9. Conveyance Allowance

10. Educational Allowance

11. Night Shift Allowance

12. Special Allowance

13. House Rent Allowance

14. Attendance Incentive Scheme

15. Benefits

16. Basic

17. Medical Allowance

18. Bonus

19. Canteen

66