WORKSHOP ON

Performance Management System

&
Performance Related Pay

Presentation by

NSIC
 NSIC’s MANDATE

NSIC established in 1955 with the aim to:

aid, counsel, assist, finance, protect and
promote the interests of MSMEs in India.

NSIC achieves its mandate by:

Devising schemes which are need based and
demand driven,
Catering to the requirements of the MSMEs
through a judicious blend of `Commercial’ and
`Promotional’ activities.
Functioning on self-sustaining basis, with cost
recovery in each scheme.
 NSIC’s SCHEMES

MARKETING CREDIT

• Raw Material Distribution • Credit for Raw Materials &

• Registration for Government Marketing
Purchase
• Tender & Consortia Marketing, • Credit facilitation through 15
• Marketing Events Banks.
• Marketing Intelligence

TECHNOLOGY SUPPORT SERVICES

• Training • Performance and Credit

• Material Testing Rating
• Job-work • B2B Portal
• Energy and Environment Audit • Training – cum –Incubation
• Software Technology Parks
 NSIC’s BRIEF OUTLINE

1) A self sustaining, profit making, dividend paying

company – Dividend being paid since 2006-07.
2) No budgetary support for its operations since
1.4.2007.
3) Mini – Ratna (Category-II) status conferred in
2011.
4) Achieved ‘Excellent’ MOU rating continuously
since 2007-08.
5) ‘Nil’ comments received from C&AG on Annual
Accounts continuously since 2006-07.
6) Manpower – 849 in 2006-07 and 896 in 2011-12.
 NSIC’s BRIEF OUTLINE
8) Training & Redeployment of Manpower.
9) All offices independent profit centre.
10) Reach & Volume of Operations multiplied manifold
during last few years (2006-07 to 2011-12):
a) Total business increased from Rs.2198 crore to Rs.11137
crore (increase of 407%).
b) Business per employee increased from Rs. 2.59 crore to Rs.
12.43 crore, (increase of 380%)
c) Gross Margin increased from Rs. 15.33 crore to Rs. 153.33
crore (increase of 900%),
d) Gross Income increased from Rs.47.68 crore to Rs.252.71 crore
e) Profit Before Tax increased from Rs 3.00 crore to Rs. 60.21
crore ,
 Performance Appraisal System in NSIC
 MOU signed with each Head at the Field Office, Zonal
Office and at Head office outlining the targets for
each year.

 Targets / work allocations are assigned to each

employee at Field Office(s) and Head Office, at the
beginning of each Financial year.

 Targets / work allocations are also made to all

employees engaged in Support Services.

 The achievements of the field offices get evaluated

on monthly basis by the respective Zonal Head, on
quarterly basis by the Directors. A half yearly review
is made by the CMD.
 Achievements at the end of the year are compared
with the targets / work allocations assigned for the
year.
 Performance Appraisal System in NSIC
 NSIC adopted new ‘Annual Performance Assessment
Report’ (APAR) with effect from 2009-10.
 APAR has three segments aggregating to 100 marks
viz.
a) Performance Evaluation (60 marks),
b) Functional Competencies (20 marks), and
c) Discipline (20 marks)
 Annual Appraisal is linked with the achievements
against the targets / work allocation.
 Marks obtained against performance in APAR get
graded as per details given below:
Marks Grading
91-100 Excellent
71-90 Very Good
46-70 Good
31-45 Fair
1-30 Inadequate/Poor
 Performance Appraisal System in NSIC
 Performance Evaluation:
made by comparing the achievements against the
targets / work allocation.
 Functional Competencies:
the achievements w.r.t following are assessed:
a) Professional Ability and Job Knowledge
b) Quality of Work
c) Judgement, Decision Making and Initiative
d) Organizational Commitment
 Discipline:
the achievements w.r.t following are assessed:
a) System Discipline
b) Personal Conduct
c) Punctuality and Frequency of Leave
d) Inter Personal Relations
 Performance Related Pay (PRP) in NSIC
 DPE’s guidelines on PRP followed.

 Remuneration Committee of the Board constituted,

consisting of three independent Directors.

 Headed by an Independent Director.

 PRP paid in NSIC from 2009-10 to Executives and

in 2010-11 to Executives and Unionized cadres.
 Details of PBT, PRP, Distributable Profit
(Rs. In Crore)
Financial PBT 3% PRP Incremental 10% 2% of PRP 5% Total Distribu
Year of from PBT of PBT from PBT PRP table
PBT 3% Year Amt. Col. 6 Col. 6 Profit

1 2 3 4 5 6 7 8 9 10 11 12
2009-10 25.94 0.78 0.78 (09-10) 19.02 1.90 0.52 0.52 1.30 3.27 1.30
(-)
(08-09)

2010-11 35.17 1.06 1.06 (10-11) 9.23 0.92 0.70 0.70 1.76 3.97 1.76
(-)
(09-10)

PRP for 2009-10 and 2010-11 was restricted to Distributable

Profit for each of these years.
 Bell Curve Approach in NSIC

 DPE’s guidelines on compliance of ‘Bell Curve

Approach’ followed w.e.f. 2010-11.

 For complying with ‘Bell Curve Approach’, NSIC has

taken:
a) 15% of the highest ranked amongst the ‘Excellent’
graded employees, and
a) 10% of the employees have been graded as ‘Poor’.
THANK YOU