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MBA IB, Batch: 2009 – 11





PUNE - 411 057

I owe a great many thanks to a great many people who helped and
supported me during the course of the project

My deepest thanks to Mr. Sanjeev Dabke, Deputy Manager, Personnel &

Administration, Blue Star Ltd. for guiding and correcting various documents of
mine with attention and care. Mr. Dabke has taken pain to go through the project
and make necessary correction as and when needed. Thanks and appreciation to
the helpful people at Blue Star Ltd. for their support.

My deep sense of gratitude to, Miss Soumi Rai, Assistant Professor,

Symbiosis Institute of International Business, the Guide of the project, for her
support and guidance.

I express my thanks to Dr. (Mrs.) Rajani Gupte, The Principal,

Symbiosis Institute of International Business, Pune for extending her support.

I would also thank my Institution and my faculty members without whom

this project would have been a distant reality. I also extend my heartfelt thanks to
my family and well wishers.

Table of Contents

1. INTRODUCTION ................................................................................................ 4

1.1 COMPANY OVERVIEW .............................................................................. 5

1.2 VISION, MISSION, OBJECTIVES................................................................ 5
1.3 HISTORY AND GROWTH OF COMPANY .............................................. 6
1.4 MILESTONES................................................................................................. 7
1.5 MANUFACTURING PROCESS .................................................................. 9
1.6 PRODUCTS................................................................................................... 12
1.7 RESEARCH & DEVELOPMENT............................................................... 15
1.8 TECHNOLOGY ASSOCIATES.................................................................. 16
1.9 BUSINESS ASSOCIATES............................................................................ 16
1.10 BLUE STAR ESTABLISHMENTS............................................................ 18


2.1. EXPORTS...................................................................................................... 20
2.2. SUPPLY CHAIN MANAGEMENT ......................................................... 20
2.3. CHANNEL DEVELOPMENT................................................................... 21

3. HUMAN RESOURCE MANAGEMENT IN BLUE STAR ........................... 24

3.1. CORPORATE SOCIAL RESPONSIBILITY ............................................. 26

3.2. RISKS AND CONCERNS .......................................................................... 27
3.3. EMPLOYEE DEVELOPMENT.................................................................. 28
3.4. CAREER AT BLUE STAR .......................................................................... 29
3.5. ORGANIZATIONAL STRUCTURE ........................................................ 31

4. TRAINING & DEVELOPMENT AT BLUE STAR ....................................... 33

4.1. TRAINING DELIVERY CYCLE................................................................ 34

5. FINDING AND ANALYSIS .............................................................................. 50


7. ANNEXURE........................................................................................................ 76

8. REFERENCES.................................................................................................... 81



Blue Star is India's largest central air-conditioning company with an annual

turnover of Rs 2574 crores, a network of 24 offices, 5 modern manufacturing
facilities, 650 dealers and around 2500 employees. Blue Star has business
alliances with world renowned technology leaders such as Rheem Mfg Co, USA;
Hitachi, Japan; Eaton - Williams, UK; Thales e-Security Ltd., UK; Jeol, Japan; ISA,
Italy and many others, to offer superior products and solutions to customers. The
Company has manufacturing facilities at Thane, Dadra, Bharuch, Himachal and
Wada which use state-of-the-art manufacturing equipment to ensure that the
products have consistent quality and reliability. Blue Star fulfills the air-
conditioning needs of a large number of corporate and commercial customers
and has also established leadership in the field of commercial refrigeration
equipment ranging from water coolers to cold storages. Blue Star's other
businesses include marketing and maintenance of hi-tech professional electronic
and industrial products. Blue Star primarily focuses on the corporate and
commercial markets. These include institutional, industrial and government
organizations as well as commercial establishments such as showrooms,
restaurants, banks, hospitals, theatres, shopping malls and boutiques.


• To deliver a world class customer experience.

• Focus on profitable company growth.
• Be a company that is a pleasure to do business with.
• Work in a boundary – less manner between divisions to provide best
solutions to customers.
• Win our people’s hearts and minds.
• Place the company’s interest above one’s own.
• Encourage innovation, creativity and experimentation in what we do.

• Build an extended organization of committed business partners.
• Be a good corporate citizen.
• Honor all personal and corporate commitments.
• Maintain personal integrity.
• Ensure high standards of corporate governance.


Blue Star was founded in 1943, by Mohan T Advani, an entrepreneur of

exemplary vision and drive. The Company began as a modest 3-member team
engaged in reconditioning of air conditioners and refrigerators. An expanding
Blue Star then ventured into the manufacture of ice candy machines and bottle
coolers and also began the design and execution of central air-conditioning
projects. Then came the manufacture of water coolers. In 1949, the proprietorship
company set its sights on bigger expansion, took on shareholders and became
Blue Star Engineering Company Private Limited. Ever since, there has been a
constant and profitable growth. Blue Star diversified and took up agencies for
Material Testing Machines and Business Machines. The export arena beckoned
and the Company began exporting water coolers to Dubai, where in fact, 'Blue
Star' soon became the generic name for water coolers. The sixties and the early
seventies witnessed Blue Star continuing to expand and thrive. A team of
dedicated professionals aided Mohan T Advani in ever furthering his vision of a
profitable company dedicated to its ideals of professionalism and success.
Employee strength crossed the 1000 mark and the company went public in 1969
to become Blue Star Limited, as it continues to be called today. Blue Star crossed
the Rs. 500 crore milestones in 2000 and the Rs. 600 crore milestones in 2002-03.
With the boom in construction activity and increased infrastructure investments,
the Company leveraged its leadership position to grow aggressively. In the
following three years, the Company nearly doubled its turnover, clocking Rs
1178 crores in 2005-06. Even more than size, Blue Star enjoys an enviable

reputation as an ethical corporation, ever mindful of its obligations towards
customers, shareholders, dealers, business partners, employees and the
environment in which it operates.

Year Event
1943 Mohan T Advani establishes Blue Star Engineering Company
as a proprietary firm
1946 Blue Star secures Melchior Armstrong Dessau agency
1947 Worthington selects Blue Star as Indian Partner. Manufacturing
of ice candy machines and bottle coolers begins. Central air-
conditioning system design and execution begins
1948 Manufacture of water coolers commences
1949 Proprietorship converted to Private Limited Companies
1954 Blue Star selected as distributor for Honeywell
1955 GDR Testing machines distributorship begins
1957 Perkin-Elmer tie-up marks the start of the electronics business.
GDR business machines agency commences
1960 Total Income crosses the Rs 1 crore mark
1964 Total employment crosses 1,000
1965 Techniglas Pvt Ltd set up to manufacture insulation material
1969 Factory moves from Colaba in Mumbai to Thane
1970 Hewlett- Packard distributorship commences
First skyscrapers of Mumbai – Air India Building, Express
1972 Towers and Oberoi Hotel set-up – all air-conditioned by Blue
1972 Total Income crosses Rs 10 crores. Employment crosses 2,000
Water Cooler manufacturing license granted to Yusuf
Alghanim, Kuwait
Middle East thrust begins. Joint Venture (JV) with Al Shirawi in
1977 Hitachi Medical Equipment distributorship begins
1978 Industrial Division commences activity
1980 Bharuch Factory set up
1980-86 Major AC and R projects executed in the Middle East
1983 International Software Division inaugurated in Seepz
1984 York technology collaboration begins
1985 Manufacture of centrifugal packaged chillers commences at

Thane Plant
1986 Total Income crosses Rs 100 crores
1987 Yokogawa Blue Star JV formed
1987 Gandhinagar factory set up for EPABX systems
Blue Star becomes India’s largest central air-conditioning
1988 Manufacturing collaboration with Mitsubishi
Assembly of personal computers under the brand name
‘Quantum’ begins
1989 JV with Hewlett-Packard and Motorola
1990 Gandhinagar factory closes
1992 Total Income crosses Rs 200 crores
1992 Blue Star exits from Motorola JV
1993 Formation of Arab Malaysian Blue Star JV in Malaysia
1995 Blue Star exits from HP India JV
1997 Dadra Plant inaugurated
1998 Major thrust on dealerisation and brand building begins
1999 Blue Star exits from Industrial Projects business
International Software business spun off to form Blue Star
InfoTech, listed on stock exchanges
Total Income crosses 500 crores. Export of air-conditioning
products begins
2003 Blue Star exits Yokogawa JV
Blue Star sets up new factory at Kala Amb in Himachal
2006 Total Income crosses the Rs 1000 crores mark
2006 Blue Star opts for a 5 for 1 stock split
2007 Blue Star sets up its fifth factory at Wada, Thane District
Blue Star powers into Building Electrification. Acquires Naseer
Electricals, a leading Electrical Contractor
2009 Total income crosses Rs. 2500 Crores.


Blue Star understands that skilled manpower and other staff members are an
indispensable part of the manufacturing set-up and the management should
work shoulder to shoulder with them. Management grade staff too is put
through training programs on various aspects of manufacturing and business.
Also, performance awards are announced every year. Apart from enhancing the
skills of the staff, such initiatives create a positive, firm and lasting emotional
bond between staff and company. This in turn contributes to greater

Manufacturing Systems
The factories make extensive use of IT to enhance productivity and product
development capabilities. All our factories are ISO 9001: 2000 certified BAAN
ERP implemented in 3 factories and Himachal under implementation.

Raw Material & Material Management

Sheet metal fabrication

A high degree of repetitive accuracy in sheet metal fabrication is achieved by
using specialized equipment, CNC metal forming machines. The raw material
used is prime quality, corrosion-resistant, galvanized steel for enhanced life of
the product. The equipment used for processing the steel includes CNC
machines such as an Amada turret punch press, a LVD / Amada hydraulic
press-break. All these allow for high quality cabinet fabrication within tight

Power coating plant

The state-of-the-art powder coating plant covers a wide range of very specialized
process equipment, and is fully automated. A water-softening unit treats the raw
water before it is utilized in the automatic hot spray pre-treatment system. It
provides an even distribution of chemicals, controlled by an auto dosing
mechanism that maintains the chemical bath composition with the help of
electronic sensors. After a final mineral water rinse, the components pass
through a dry-off oven under dust-free conditions to remove all traces of
moisture. The components are then transferred into the powder painting booth
for coating, where temperature, humidity and dust levels are controlled. The
powder painting equipment, supplied by Nordson, USA, is equipped with
automatic electromechanical oscillators, for even powder deposition.
Desiccant dry air-with a dew point of minus 400 C - helps avoid any
moisture contamination of the powder. A 'smart spray' mechanism senses the
conveyor movement and component geometry to adjust powder flow. Polyester
powder - ideally suited for out door applications - provides the maximum
protection against UV deterioration and corrosion. The components finally pass
through a temperature-regulated curing oven to achieve desired gloss and
surface hardness.

Heat exchangers
Experienced engineers create heat exchanger designs using high precision design
software, which are then validated in our test labs. Blue Star also makes sure that
the designs are energy efficient for optimum heat transfer.
Fin and Tube: The sophisticated coil shops have some of the most advanced
machines from USA, Japan and Korea. The Burr Oak coil line produces energy
efficient DX heat exchangers. These have plain or enhanced split fins with
grooved copper tubes for maximum heat transfer efficiency. Then the source

plain and inner grooved copper tubes with coated aluminum fin stock of
international quality from leading manufacturers to fit our specifications.
Shell and Tube: Blue Star has shell and tube exchangers using specially
enhanced surface copper tubes and shell design as per Blue Star or TEMA
standards. Blue Star uses Heat Transfer Research Inc. (HTRI design software for
these heat exchangers).
Plate Type: Blue Star products also incorporate stainless steel plate heat
exchangers for specialized process applications.

System tubing
3-axis CNC copper tube-bending machines from Japan fabricate wrinkle-free
system tubing to exact dimensions for a perfect stress-free fit. Special purpose
machines carry out operations like end closing, flaring and forming for good
joint formation. Prime quality copper tubes sourced globally help in optimum
product performance.

The brazing process is carried out in an inert atmosphere to avoid oxidation and
the resultant impurities from contaminating the refrigerant system. Specially
selected brazing equipment and fixtures are used to produce high quality
brazing. The joints are pressure-tested to check weld strength and leakage. The
coils are then tested for fine leaks with ultra-sensitive electronic leak detectors.
An automated coil brazing line from Korea ensures consistent quality brazing
and leak proof joints.

PUF installation
Blue Star fabricates CFC-free PUF insulated panels by using the latest equipment
from Cannon. This enables to achieve a uniform and constant density of
insulation for air handling units, telecom shelters and cold storage panels. Blue

Star supply panels of up to 6 meters in length and 25 mm to 125 mm in PUF
thickness. PUF insulation expertise finds use in a wide range of applications such
as Air Handling Units, water coolers, deep freezers, reach-in coolers and
mortuary chambers.

Assembly and testing

The final product is assembled sequentially on conveyors, with in-built quality
checks during assembly operations. Pneumatic tools permit torque-controlled
rigidity, and specially coated corrosion-resistant hardware provides firm locking.
Each machine is then electronically tested for leaks and run-tested for
performance and electrical safety parameters before packaging.


Central Air-condition
The building blocks of Blue Star’s solutions are its products. The company offers
most comprehensive range of air-conditioning products in the country. A wide
range of models are available in each product category to ensure that the air-
conditioning system design is implemented without any compromise. All
products have been designed on the energy-efficiency platform, and offer a host
of advanced features.

Room air conditioners

By being an expert in the area of central air-conditioning, it also helps us
understand the cooling requirements of a diverse range of applications. This
expertise, knowledge and the skills have helped us to have some of the most
technologically advanced and energy efficient air-conditioning solutions for
small spaces.
Commercial Refrigeration

Having been the leaders in commercial refrigeration, we have a wide range of
products catering to various small and large scale industries

Cold storages
Blue Star’s Cold Storage Division offers us a wide range of cooling and
preservation solutions. Solutions tailored made to suit any industry that requires
storage of perishable produce over extended periods of time without suffering
any loss of quality – be it in look, feel, touch, taste or chemical composition.
Industries that find Blue Star’s cold storage solutions enormously useful include
the agriculture sector including horticulture and floriculture units,
manufacturers of fresh produce of any kind, food processing units,
pharmaceutical industries, seafood and other similar industries, as well as the
dairy and hospitality sectors, including hotels, restaurants, and eateries.

Specialty Cooling Products

Blue Star has developed specialized products for process applications, IT/ITES,
telecom and the dairy industry. It has diverse experience and have a deep
understanding of the demands on air-conditioning and refrigeration in each
industry. This knowledge and domain expertise has helped in designing and
manufacturing a range of specialized products which ensure that critical
applications work seamlessly.

Some of Blue Star’s products


Blue Star offers complete engineered products and solutions with differentiated
features. With the extent of climatic conditions varying across the nation, our
products are designed to suit the specific local conditions. Considering the
shortfall of Electricity supply, all the products are designed for energy efficiency.
Blue Star products are most preferred in the domestic market because of energy
efficiency features. In the offer, they are widest range of products for varying
applications. This is possible due to extensive research and development that
goes behind the products.
All our factories are equipped with robust R&D facilities and a lot of importance
is given towards continuous up gradation. Currently R&D team constitutes
nearly 20% of the manufacturing division work force. This is a testimony to the
significance that R&D has in the product development process at Blue Star. R&D
team is encouraged to update with the latest techniques and processes in the
field and thus are sent to various exhibitions / site visits across the globe.
Consultants from various industries are also hired for specific industrial design
Blue Star also believes in associating itself with leading global organizations that
have done path breaking work in the field of innovations. The company also has
tie-ups with reputed companies for knowledge sharing and technical institutions
like IIT, Mumbai, where individual projects are executed. R&D at Blue Star also
handles customer specific requirements, which require tremendous amount of
expertise in that particular domain. Software that R&D team has deployed and
which is used on a regular basis - Pro-Engineer, Solid Edge, AutoCAD, Pro
Mechanics, R&R, HTRI, Mechanical Desktop, Rhino, Alias, CATIA, IDEAS, Solid
Works, Patran, Hypermesh, Femap, Ansys, Nastran, Fluent, Flow Mechanica and
Moldflow. Software packages including those for system design, air handling
unit selection and heat exchanger optimization.


Blue Star has associated itself with global knowledge partners who have been
leaders in specific product manufacturing. Through this partnership, Blue Star
has been able to command a leadership position in the domestic market. Blue
Star initially tied-up with York in the mid 1980s. It has been able to leverage this
expertise and learning to manufacture its own Chillers. We now manufacture our
own range of Screw, Scroll and Process Chillers. For Cold Rooms, Blue Star had
tied-up with Kolpak, USA and Heat Craft for Freezing Units. Rheem, USA not
only provided technical support for building the world class Dadra
manufacturing unit, but also shared technical expertise. The foray in precision
equipment business was achieved with support from Eaton Williams. Blue Star
now manufactures Precision Control Packaged Units for domestic and global


In keeping with its win-win approach, Blue Star treats its vendors as not just
suppliers, but as business partners and tries to build long term associations that
are profitable both to the suppliers and to Blue Star. In line with this thought,
Blue Star has entered into long term arrangements with its key suppliers, many
of whom are world leaders. For instance, Blue Star sources its Switchgears from
Siemens, Compressors from Danfoss of Netherlands and Refrigerant from
DuPont. General Electric Corp of USA provides Motors, while Hanbell of Taiwan
supplies Screw Compressors. Copeland of USA assists in System Design.
Over the years, Blue Star has built a strong network of suppliers around it. Not
only that, the company also helps in the development of its smaller suppliers by
providing various business related and technical inputs to them. For instance,
since the vendors are also manufacturers, they will benefit from some of the

good manufacturing practices that Blue Star adopts. Blue Star has educated a
number of small vendors on the importance of ISO certification and encouraged
them to get certified within a certain time period. This approach has greatly
boosted the morale of vendors and firmly bonded them with Blue Star. Also, it
ensures that the suppliers walk side-by-side with Blue Star on the path to




Blue Star has been exporting its products to the Middle East for over two
decades. Blue Star products have stood the test of time in some of the most
difficult climatic conditions in the world such as UAE, Qatar, Bahrain, Oman and
Kuwait. On offer it has a comprehensive range of products such as chillers with
screw and hermetic scroll compressors, a wide range of air handling and fan coil
units, duct able packaged and duct able split air conditioners including the heat
pump versions. Blue Star also offers unitary products such as window and split
air conditioners, deep freezers, cold rooms, water coolers and specialized air
conditioners for precision control applications, Variable Refrigerant Flow (VRF)
Systems with digital scroll technology and process chillers with frequency
modulation. These world-class products are manufactured at our state-of-the-art
manufacturing facilities in India. All the manufacturing facilities are ISO 9001:
2000 certified, and are powered through integrated Enterprise Resource Planning
(ERP) software. Moreover, most of the products go through stringent tests on
reliability and performance in our test labs.


Rapid growth coupled with volatility of input costs necessitated an agile and
adaptable supply chain. The Blue Star focused on both the efficiency and
responsiveness of all aspects of the supply chain by improving all round
execution capability. A combination of short term and long term view along with
the support of business associates helped the
Company tide over the uncertainty and turbulence of increasing input costs. The
supply chain adequately met the increased demands of the market place
supporting greater channel and project business success.


Blue Star has around 180 systems dealers who exclusively deal in the Company's
systems businesses consisting of packaged air conditioning and cold rooms.
These dealers are provided technical expertise, installation and service
competence of a high order. On the other hand, room air conditioners and
refrigeration products, which are simple to install, are sold through a larger
network of approximately 600 dealers. Most of them deal exclusively with Blue
Star products in the HVAC domain. A few are multi-brand, multi-product
dealers. The Company has established a Channel Management Centre to oversee
the policy framework, certification and development of dealers and also put in
place a Training Department for training channel partners. During the year, the
Company implemented a number of initiatives in order to strengthen the
competence of the dealer channels and make them more robust. A Management
Development Program (MDP) for systems dealers was held to impart the
essentials of managing a business professionally. Systems dealers were also put
through a Sales Management training program in order to enhance their sales


Blue Star takes pride in the fact that the invaluable technical and business
knowledge it has acquired in 65 years as an organization in the field of air
conditioning and refrigeration is perhaps the richest in the country. During the
review period, with the substantial increase in business volume, the Company
increased its total head count to 2565 (including the absorbing of 124 employees
from Nasser Electricals) as on March 31, 2008, an increase of 18% over the
previous year, while Net Sales grew by 39%. Organizational productivity
continued to grow in terms of sales per person and value added per person. The
focus on people development continued at the same pace with special attention
to developing the technical skills of dealers and business associates. Training in
soft skills for Blue Star employees was enhanced with the introduction of some
new training programs. In order to sustain the positive culture of the Company,
a new corporate program was introduced called 'The Blue Star Way'. This
program is intended to create an awareness of, and strengthen the Blue Star Way
of working.

A 360-degree feedback system continued to be used to measure

behavior of Senior Managers pertaining to the Corporate Values and Beliefs.
Environment, Health & Safety (EHS) has gained relevance as a new management
discipline in recent times. In order to improve its performance in the EHS
domain, the Company decided to provide a corporate focus by creating a new
department called 'Environment, Health & Safety'. The EHS Department will be
responsible for creating standards and conducting workshops to sensitize all
employees and business partners on the EHS norms to be followed in the course
of business. The Welfare initiatives include providing life insurance cover to all
employees through HDFC Standard Life Insurance, annual medical check-ups
for employees above the age of 40 years, and the Company subsidizing the
medical insurance premium for dependent parents. The Mohan T Advani
Education Trust disbursed scholarships to employees' children pursuing higher

professional education while Blue Star Sahayata Foundation extended financial
assistance to a number of deserving cases for mitigating emergency medical
expenses. Harmonious and constructive relations between the Management and
workmen helped to maintain a cordial work atmosphere and achieve business


Eco friendly initiative

Blue Star has made significant progress towards minimizing and even
eliminating the environmental hazards resulting from CFCs in certain
refrigerants used for cooling. As a matter of fact, Blue Star is one of the few
companies selected in India for funding by "The Multilateral Fund for the
implementation of the MONTREAL PROTOCOL". Blue Star has already
introduced 'ozone friendly' centrifugal chillers using HCFC-123, the safe
refrigerant replacing CFC-11. Blue Star also markets absorption chillers which
use water as refrigerant. All Blue Star reciprocating chillers already use HCFC-22
refrigerant which is friendlier to the environment than the older R-12. The
Company actively promotes wider use of large refrigeration systems using
ammonia as the refrigerant. In fact, Blue Star is a member of the International
Institute of Ammonia Refrigeration, USA.

Social initiative

Blue Star firmly believes that organizations must look beyond making profits
and should contribute to the development and welfare of the society. This
attitude is most evident in the outreach initiatives organized by Blue Star's
factories. Blue Star factories take active participation in providing temporary
shelters and essentials for the victims of an earthquake, sponsoring health check-

ups and health education programs in local schools. The families of operators are
an integral part of social development. Blue Star gives them appropriate advice
on personal matters, financial and investment matters. The family members are
also imparted training on diverse subjects. They are taught English as well.

Environmental initiative

Blue Star's factories have been exquisitely landscaped with lawns and flowering
plants dotting the campus. Trees have also been planted on a proactive basis
even outside the Blue Star factories. As a responsible organization, special ETP
plants are installed to dispose off the wastes generated. Additionally, all our
factories are designed for rain water harvesting.


The Company has in place an effective Risk Management framework under
which all internal and external risks across the various businesses and functions
are periodically identified, assessed and acted upon by the risk owners to
minimize and mitigate their impact. These processes are also periodically
reviewed to ensure their effectiveness.
The Company continues to satisfactorily address the various financial risks
relating to interest rates, exchange rates and credit risks as well as operating risks
arising out of high input costs, changes in technology, customer preferences,
increasing size and complexity of contracts and competitive pressures.

While the strong fundamentals of the Company and it's sound financial base
have placed it in a strong position to face the vagaries of the market, the overall

uncertain economic scenario coupled with local and global inflation and the high
price of oil are causes for concern and consequently a slow down in the economy
could impact the growth of the Company to some extent in the coming year. The
Company will continue to remain vigilant and will proactively take steps to
mitigate the adverse impact, if any, arising out of these concerns.


The benefit of a mature business organization with 65 years of operational

excellence is that there are several good systems in place. From a prospective
employee point of view, Blue Star offers the following advantages:

• There are well designed induction and technical orientation programs.

There is a Corporate Technical Training Organization which delivers a
variety of technical training programs for the AC&R business. Engineers
who join the Electronics Division get a chance to go abroad for training
with the Principals. The Corporate HR runs a menu of non-technical soft
skills training programs such as Business Communication Skills and
Business Etiquette.

• The Blue Star Company has many well designed, time tested HR practices
such as setting the performance objectives at the beginning of the year,
reviewing employee performance every year through an annual appraisal
system and an annual compensation review based on market surveys. In
addition to a market aligned salary structure, Blue Star also has a fairly
attractive incentive scheme wherein, the employee gets an incentive based
on his department’s performance coupled with his own performance

• Typically, graduate engineers can look forward to entering real
managerial grades within 4 to 5 years. Once an employee enters the
managerial grade, he is exposed to a variety of management education
programs including some programs at IIM. Ahmedabad.

• Last, but not the least, Blue Star rightly boasts of the Blue Star Way, which
is founded on a set of values and beliefs which have evolved over time.
These beliefs have made Blue Star a highly respected, secular
organization. The Company has an excellent track record of employees
working for many decades with the Company. In today’s high attrition
market, the Company continues to enjoy the privilege of retaining many
of its employees for many decades, thanks to its positive work culture.
• The company lays stress on continuously upgrading the skills of
operators, so that they keep increasing their productivity in the face of
changing manufacturing practices. Operators are put through training
programs, on passing which they are given certificates. In the long term,
these certificates also become a yardstick for measuring employee
performance. Learning through cross functional activities is encouraged.
In addition to that, staff members and operators are encouraged to
exercise yoga, play sports and participate in community development
initiatives. This helps in the overall development of the individual and
improves performance. Kaizen and 5S are an integral part of all factory


Since engineering and technical expertise are at the heart of the Blue Star value
proposition, engineers constitute the bulk of Blue Star’s recruitment.
Consequently, engineers (graduate as well as diploma) can find technically
satisfying and well paying jobs in the following areas of Blue Star

Air conditioning Projects Division:

Mechanical engineers are deployed in 3 different disciplines i.e. Sales, Design &
Engineering and Construction. Blue Star also entered the commercial building
electrical business since 2008. Consequently, electrical engineers (graduate and
diploma) can also find careers in the Electrical Projects


Blue Star manufactures a wide range of air conditioning and refrigeration

equipment at its five factories. Here, careers can be made in R & D, Production,
Production Planning, Manufacturing Engineering, Quality and Reliability and
Procurement. Graduates as well as post graduates in mechanical, electrical and
electronics engineering can find rewarding careers in Blue Star’s manufacturing

Air-conditioning & Refrigeration Service Division:

Here again, engineers constitute the bulk of recruitment. Careers can be made
broadly in 3 disciplines viz. Service Marketing, Service Delivery and Service
Specialists’ Group.

Channel Businesses

Packaged air conditioners, room air conditioners, refrigeration products and cold
storages are mostly executed through licensed channel partners. Consequently,
engineers as well as MBAs with an aptitude for marketing can develop satisfying
careers in any of the channel businesses.

Management Services:

Like in all large corporate, the Company has well structured management service
departments such as Procurement & Logistics, Finance and Accounts and
Human Resources. Blue Star looks for talented professionals with appropriate
qualifications for these departments.


Branch Manager

Core Functions Support Functions

ACPD Projects
HR Admin

Cold Room

Service Dept.

Packaging Unit


Team Structure for Core Functions

Area Manager

Deputy Manager

Assistant Manager

Senior Sales Planning/ Construction

Engineer Materials


4. Training & Development at Blue

The HR functioning is changing with time and with this change, the relationship
between the training function and other management activity is also changing.
The training and development activities are now equally important with that of
other HR functions. In most of the organizations, training is an investment
because the departments such as, marketing & sales, HR, production, finance, etc
depends on training for its survival. If training is not considered as a priority or
not seen as a vital part in the organization, then it is difficult to accept that such a
company has effectively carried out HRM. Training actually provides the
opportunity to raise the profile development activities in the organization. To
increase the commitment level of employees and growth in quality movement
(concepts of HRM), senior management team is now increasing the role of
training. Such concepts of HRM require careful planning as well as greater
emphasis on employee development and long term education. Training is now
the important tool of Human Resource Management to control the attrition rate
because it helps in motivating employees, achieving their professional and
personal goals, increasing the level of job satisfaction, etc. As a result training is
given on a variety of skill development and covers a multitude of courses.


Designing a training and development program at Blue Star India Pvt. Ltd (BSIL)
involves a sequence of steps that can be grouped into four phases as described

1. Training 2. Content
Need Development


& Delivery

To be effective and efficient, all training programs must start with a needs
assessment. Long before any actual training occurs, the training manager must
determine the who, what, when, where, why and how of training.

4.1.1. Training need

The needs assessment is the first step in the establishment of a training and
development Program. It is used as the foundation for determining instructional
objectives, the selection and design of instructional programs, the
implementation of the programs and the evaluation of the training provided.
These processes form a continuous cycle which always begins with a needs
The first step in designing a training and development program is to conduct a
needs assessment. To do this, the training manager must analyze as much
information as possible about the following:

 Organization and its goals and objectives.

 Jobs and related tasks that need to be learned.
 Competencies and skills that are need to perform the job.
 Individuals who are to be trained

There are three levels of needs assessment:

1. Organizational analysis
2. Task analysis
3. Individual analysis.


Organizational Task Individual

Analysis Analysis Analysis

1. Organizational analysis

Organizational analysis looks at the effectiveness of the organization and

determines where training is needed and under what conditions it will be
The organizational analysis identifies:
 Environmental impacts (new laws and regulations)
 State of the economy and the impact on operating costs.
 Changing work force demographics and the need to address cultural or
language barriers.
 Changing technology and automation.
 Increasing global/world market places.
 Political trends such as sexual harassment and workplace violence.
 Organizational goals (how effective is the organization in meetings its
goals), resources available (money, facilities; materials on hand and
current, available expertise within the organization).
 Climate and support for training (top management support, employee
willingness to participate, and responsibility for outcomes).

The information needed to conduct an organizational analysis can be obtained

from a variety of sources including:

 Organizational goals and objectives, mission statements, strategic plans.

 Staffing inventory, succession planning, long and short term staffing
 Skills inventory: both currently available and short and long term needs,
organizational climate indices: labor/management relationships,
grievances, turnover rates, absenteeism, suggestions, productivity,
accidents, short term sickness, observations of employee behaviour,
attitude surveys, customer complaints.
 Analysis of efficiency indices: costs of labour, costs of materials, quality of
products, equipment utilization, production rates, costs of distribution,
waste, down time, late deliveries, repairs.
 Changes in equipment, technology or automation.
 Annual report.
 Plans for reorganization or job restructuring.

 Audit exceptions; reward systems.
 Planning systems.
 Delegation and control systems.
 Employee attitudes and satisfaction.

2. Task analysis

Task analysis provides data about a job or a group of jobs and the knowledge,
skills, attitudes and abilities needed to achieve optimum performance.
There are a variety of sources for collecting data for a task analysis:
 Job description-- A narrative statement of the major activities involved
in performing the job and the conditions under which these activities
are performed. If an accurate job description is not available or is out
of date, one should be prepared using job analysis techniques.
 KSA analysis-- A more detailed list of specified tasks for each job
including Knowledge, Skills, Attitudes and Abilities required of
 Performance standards-- Objectives of the tasks of the job and the
standards by which they will be judged. This is needed to identify
performance discrepancies.
 Observe the job/sample the work.
 Perform the job.
 Job inventory questionnaire-- Evaluate tasks in terms of importance
and time spent performing.
 Review literature about the job-- Research the "best practices" from
other companies, review professional journals.
 Ask questions about the job-- Of the incumbents, of the supervisor, of
upper management.
 Analysis of operating problems-- Down time, waste, repairs, late
deliveries, quality control.

Identifying Training Needs through Appraisal form

The lists of training programs that are undergone by the employee are
mentioned in the performance appraisal form. The form not only includes the
training programs that were undergone by the employee but also the future
programs that are needed to be undertaken by the employee. These aspects are
discussed at the time of appraisal. Thus the manager gets a first hand feedback
from the employee about the training programs he or she has undergone. This is
communicated to the Personnel department so that the training programs can be
modified accordingly if needed. The manager also evaluates over a period of
time how the training has helped in the evolution of the employee. The manager
can evaluate how the employee is applying the learning from the training
programs while in the organization. For instance, if the employee has undergone
a Behavioral Training program such as impression management, senior
managers can evaluate whether he or she use the important aspects of this
program while handling clients. This helps in the performance appraisal of the
employees and also enables in deciding promotions or giving additional
responsibilities to the employees. Thus through the feedback from performance
appraisal, training needs are identified.

Identifying Training Needs through Experience of Senior Managers

Another method in which training need is identified is through the experience of

senior managers. The managers in the course of time become aware of the
mistakes that are bound to occur during a particular task. This awareness comes
from personal experience or through sharing of other team members. And due to
the going concern concept, BSIL managers are one of the key elements who
identify the training needs.

Training Need through Customer Satisfaction Index

Training needs are also identified from the feedback which is obtained from the
customers and clients of BSIL. For instance, the customers’ satisfaction with the
service engineers quality, behavior and timeliness. The service department
regularly takes feedback from the customers and clients of the products and the
service offered by BSIL employees. This feedback provides a means for
developing the training needs.

3. Individual analysis
Individual analysis analyzes how well the individual employee is doing the job
and determines which employees need training and what kind.
Sources of information available for individual analysis include:
 Performance evaluation -- Identifies weaknesses and areas of
 Performance problems -- Productivity, absenteeism or tardiness,
accidents, grievances, waste, product quality, down time, repairs,
equipment utilization, customer complaints.
 Observation -- Observe both behavior and the results of the behavior.
 Work samples -- Observe products generated.
 Interviews -- Talk to manager, supervisor and employee. Ask
employee about what he/she believes he/she needs to learn.
 Questionnaires -- Written form of the interview, tests, must measure
job-related qualities such as job knowledge and skills.
 Attitude surveys -- Measures morale, motivation, satisfaction.
 Checklists or training progress charts -- Up-to-date listing of current

Thus "need” that is identified in several ways as discussed above. This need is
generally described as a gap between what is currently in place and what is
needed, now and in the future. Gaps can include discrepancies/differences
 What the organization expects to happen and what actually happens.
 Current and desired job performance.
 Existing and desired competencies and skills.

The need assessment can also be used to assist with:

• Competencies and performance of work teams.
• Problem solving or productivity issues.
• The need to prepare for and respond to future changes in the
organization or job duties.

The results of the needs assessment allows the training manager to set the
training objectives by answering two very basic questions: who, if anyone, needs

training and what training is needed. Sometimes training is not the solution.
Some performance gaps can be reduced or eliminated through other
management solutions such as communicating expectations, providing a
supportive work environment, arranging consequences, removing obstacles and
checking job fit.

4.1.2. Content Development

The next step in training cycle of BSIL is the content development. The training
programs can be classified in the below categories for the sake of content

• Existing training programs

• New training programs
• Outsourced training programs

Existing Training Programs

Blue Star The method of evaluation is discussed later in the report. On the basis
of the feedbacks of the employees, these training programs are modified
accordingly. The training programs are also evaluated and modified to meet the
changing technological needs. For instance, in recent times BSIL management
decided to switch from certified Microsoft Office software applications in their
systems to Open office system. Hence BSIL organized an IT workshop to provide
training to the employees on the new software system.

New training Programs

The new training programs are developed at BSIL in consultation with respective
departmental heads. Sales training is designed in consultation with the president
of the sales department. As discussed earlier, senior managers play a very
important role in development of training needs. These needs form the basis for
the content development of the training programs. The Personnel and
Administration department also plays an important role in determining the
content of the training programs.

Outsourced Training Programs

For the training programs that are outsourced, BSIL follows a pattern for
evaluation of the content of the training. Since training on technical aspects is a
must of the employees, technical training is generally outsourced to specialized
technical institutes. The following process is adopted for selecting a particular
1. Pioneer institutes giving training on the subject are selected.
2. Evaluation of the institutes by the manager
3. Short listing of institutes on the following parameters:
a. Cost
b. Methodology of training
c. Duration
4. Trainees sent of experimental basis
5. Evaluation on basis of feedback from these trainees
6. Finalizing of Training institute.

4.1.3. Coordination and Delivery

The Personnel and training department has 3 basic questions in mind to plan and
deliver the training. These questions are as below:
 Who to train?
 When should the training be given?
 Where should the training programs be conducted?

Who to train?

Certain training such as induction training are provided to all new employees.
However, the induction training is divided into 2 categories:
• Induction for experienced employees
• Induction to freshers

The induction given to experienced employees is more related with Blue Star’s
policies, work culture and environment. Since the technical expertise is already
available, the induction training is supposed to lay a greater emphasis on getting
the employee acquainted with BSIL as a corporate entity.

BSIL recruits fresh engineers directly from college. They are recruited as
Graduate Engineer Trainees ( GET). The induction training given to GETs
includes both technical training as well corporate training. The training program
is generally fixed for all the GETs and lasts for around one month so that the
GETs get a complete experience before they begin with their work.

When should the training be given?

The BSIL operations are divided into 4 sections depending on their geographical
location. These are as below:
• North
• East
• West
• South
• Manufacturing

The head office of BSIL prepares a annual training calendar for each of the
region. The calendar is prepared taking into consideration the following factors:
• Customer service and delivery is not affected
• Back up available for the employee undergoing the training
• Training period is short and not tiring for the employees

The line managers recommend the names of employees who can undergo the
training. Based on the numbers suggested by the managers, a schedule is
prepared and circulated among all the offices. For any change in the schedule,
the line manager needs to inform the P & A department of the branch.

Where is the training to be given?

The most important factor to be considered while selecting a location for training
is the cost involved.
The training locations can be classified under three categories:

1. Shop floor/ Factory

2. Hotels/ Foreign
3. Training Institutes

1. Shop Floor

The training is given on the shop floor when the content involves more of
technical and practical details. For instance, GETs are taught on shop floor about
the various components of the Air conditioners and the chillers. This enables the
GETs to identify the components easily. They can understand what kind of
components they will be working on. The training on shop floor is the least
costly method. Only factor that needs to be considered is that the shop floor
should not get too crowded as to obstruct the daily production activities of the

2. Hotels/ Foreign Trips

Certain trainings are also provided in Hotels, where a training room is booked.
This increases the cost of training. Classroom training is preferable for behavioral
training such as Impression management, Presentation skills, Me2We etc. The
training is carried out in a period of two to three days. Meals are provided to the
employees in the hotels.
Sometimes, the employees are also sent abroad for training. One such instance is
the training provided on specialized chillers which are imported and then
installed in India. Since, the servicing has to be done by the service engineers of
BSIL, the engineers need to be trained on these equipments. This also reduces the
cost for BSIL, since on returning, the employees can transfer the knowledge
among their colleagues.

Training in Hotels and foreign countries also serve as a means of relaxation or a

break from the daily activities of the employees. They act as a good stress

3. Training Institutes

The training in this case is given in the institutes itself. Such type of training
includes both classroom training as well as practical training.

4.1.4. Evaluation of Training

Evaluating the Training (includes monitoring) addresses how one determines

whether the goals or objectives were met and what impact the training had on
actual performance on the job or in the community.

Generally there are 4 kinds of standard training evaluation: formative, process,

outcome, and impact.

• Formative evaluation provides ongoing feedback to the curriculum

designers and developers to ensure that what is being created really meets
the needs of the intended audience.

• Process evaluation provides information about what occurs during

training. This includes giving and receiving verbal feedback.

These two constitute monitoring

• Outcome evaluation determines whether or not the desired results (e.g.,
what participants are doing) of applying new skills were achieved in the

• Impact determines how the results of the training affect the strategic goal
e.g. health promotion goal of reducing the incidence and prevalence of

These two constitute what is usually referred to as evaluation or final evaluation

Various frameworks for evaluation of training programs have been proposed

under the influence of these two approaches. The most influential framework has
come from Kirkpatrick. Kirkpatrick’s work generated a great deal of subsequent
work. Kirkpatrick’s model (1959) follows the goal-based evaluation approach
and is based on four simple questions that translate into four levels of evaluation.
These four levels are widely known as reaction, learning, behavior, and results.
On the other hand, under the systems approach, the most influential models
include: Context, Input, Process, Product (CIPP) Model; Training Validation
System (TVS) Approach; and Input, Process, Output, Outcome (IPO) Model.

Kirkpatrick (1959) CIPP Model (1987) IPO Model (1990) TVS Model (1994)
1. Input: evaluation
1. Situation: collecting
of system
pre-training data to
1. Reaction: to 1. Context: obtaining performance
ascertain current
gather data on information about the indicators such as
levels of performance
participants situation to decide on trainee
within the
reactions at the end educational needs qualifications,
organization and
of a training and to establish availability of
defining a desirable
program program objectives materials,
level of future
appropriateness of
training, etc.
2. Intervention:
identifying the reason
2. Learning: to 2. Process: embraces for the existence of
2. Input: identifying
assess whether the planning, design, the gap between the
educational strategies
learning objectives development, and present and desirable
most likely to achieve
for the program are delivery of training performance to find
the desired result
met programs out if training is the
solution to the

3. Behaviour: to 3. Output:
3. Process: assessing 3. Impact: evaluating
assess whether job Gathering data
the implementation the difference
performance resulting from the
of the educational between the pre- and
changes as a result training
program post-training data
of training interventions
4. Results: to assess
4. Outcomes:
costs vs. benefits of
4. Product: gathering longer-term results
training programs, 4. Value: measuring
information associated with
i.e., organizational differences in quality,
regarding the results improvement in the
impact in terms of productivity, service,
of the educational corporation’s
reduced costs, or sales, all of which
intervention to bottom line- its
improved quality of can be expressed in
interpret its worth profitability,
work, increased terms of dollars
and merit competitiveness,
quantity of work,

After considering the advantages and drawbacks of all the four techniques, it
was decided to use Kirkpatrick’s model for evaluation of the training programs
at Blue Star.

The four levels of Kirkpatrick's evaluation model essentially measure:

1. Reaction of the trainee- what they thought and felt about the training
2. Learning - the resulting increase in knowledge or capability
3. Behavior - extent of behavior and capability improvement and
4. Results - the effects on the business or environment resulting from the
trainee's performance

The advantages to a Level Four evaluation are as follows:

 Determine bottom line impact of training
 Tie business objectives and goals to training

On the basis of the model, a questionnaire was prepared. The four levels of the
model formed the basic information needs. Other information needs were
developed from these. The questionnaire is attached in Annexure 1.

The training at Blue Star was divided into three categories as below for the
purpose of the survey:

1. Induction Training
2. On-job Training
3. Training Module & Courses

1. Induction Training

Induction Training at Blue Star is given to all the newly recruited employees. The
purpose of the induction period (which may be a few hours or a few days) is to
help a new employee settle down quickly into the job by becoming familiar with
the people, the surroundings, the job and the business.

Usually induction involves the new employee meeting and listening to different
people talk about aspects of the business.

The following items are covered in induction programme at Blue Star:

• Introduction to the business/department and its

personnel/management structure

• Layout of the buildings (factory / offices)

• Terms and conditions of employment (explaining the contract of


• Relevant personnel policies, such as training, promotion and health

and safety

• Business rules and procedures

• Arrangements for employee involvement and communication

• Welfare and employee benefits or facilities

The induction program should be drawn up in consultation with all of the


• Senior management (including directors)

• Supervisors or line managers

• Personnel officers
• Health and Safety managers
• Employee or trade union representatives

2. On-Job Training

Once the employee completes the induction training program, on-job training
begins. On the job training is job training that occurs in the work place. The new
employee learns the job while doing the job and while earning his or her pay
check. On the job training is also called hands on training. On the job training has
many advantages, but it can also have a few disadvantages if the OJT is not
properly planned and executed.

On-job training can be beneficial for both the company and the new employee.
OJT can be cost-effective for the business since a separate training program isn't
required and the training is part of the actual work shifts. No extra equipment is
needed as the new worker learns on the equipment needed for the job anyway.
On the job training often works out really well for the new employee since
traditional training periods tend to have a training allowance that may be lower
than the regular pay scale for the job.

Also, there is no need for the new worker to have to travel to one place for the
training and another for the job. Many times the person who will be doing the
training and evaluation is the new worker's supervisor or manager so this also
establishes job expectations right at the start. The feedback during on the job
training is also immediate, so the new employee may experience faster growth in
the job than he or she would in other types of training situations.

One major drawback of on the job training can be finding the right time for it.
The person responsible for giving and evaluating the training has to be sure that
his or her other job responsibilities are being met. Another disadvantage of OJT
is that it can be difficult to find the right person to conduct it. The person doing
the training must have the knowledge and skills with the same equipment that
the learner will be working with. Care must also be given not to pass on sloppy
work habits or unintentionally teach irrelevant or inefficient work methods to the
new worker/learner.

3. Training Module & Courses

The training modules and courses are specialised courses that are organized
during a calendar year. These courses deal with a variety of subjects. A training
calendar is prepared for an entire year by the head office and is circulated among
all the offices. The schedule is carefully planned so that the training programs are
carefully distributed throughout the year and not crammed in a particular

The offices of Blue Star are divided into the following categories with the
subsequent locations of the regions:

• North
o Delhi
• East
o Kolkata
• West
o Mumbai
o IIM Ahemdabad
• South
o Chennai
o Bengaluru
o Secundarabad
• Manufacturing
o Dadra
o Himachal Pradesh

The training programs are categorised into various categories depending upon
their purpose. The categories and the subjects are mentioned below:

• Functional

― Selling Skills
― Technical Skills

• Behavioural
― BSW- I
― Me2We
― Presentation Skills
― Interpersonal & Written Communication
― Conflict Management
― Impression Management
• Managerial
― MDP- I
― General Management Program
• Others

The questionnaire for evaluation of the training at Blue Star was divided into the
above three categories, so that each aspect of training was covered. The next
chapter speaks in details the finding and analysis of the survey.

5. Finding And Analysis



The following table shows that 71.43% of all the respondents interviewed in the
survey strongly felt that the duration of the induction training, which lasts for
two weeks, is adequate. All the service engineers responded that the training
duration was adequate.

Table 1: Duration of Induction Training

Duration Adequate manager Service Engineer Grand Total
strongly agree 28.57% 42.86% 71.43%
somewhat agree 28.57% 0.00% 28.57%
Grand Total 57.14% 42.86% 100.00%

Chart 1: Duration of Induction

Count of Duration Adequate






50.00% Service Engineer




strongly agree somewhat agree

Duration Adequate

Thus, it can be concluded that the duration of the induction program organized
at BSIL is considered to be of sufficient duration by the employees.

Periodic Evaluation of Induction Training

The following graph indicates that 57 % of all the respondents only somewhat
agreed that continuous evaluation of training was conducted. 28.57% of the
respondents did not have any opinion. Both the responses showed an equal
proportion of managers and service engineers.

Chart 2: Periodic Evaluation of Induction Training

Count of Evaluated &Improved





50.00% Service Engineer





strongly agree somewhat agree Neither Agree Nor disagree

Evaluated &Improved

The responses indicate that there is a scope for improvement in this aspect.
Induction training should be able to meet the ever changing needs of the
organization and the industry. To achieve this, it is necessary to carry out
frequent evaluation of the induction training and fine tune the training program

Understanding of skills and knowledge expected to acquire

The graph below indicates that more number of service engineers had a clear
understanding of the skills and knowledge they were expected to acquire from
the induction training. A greater percentage of managers (42%) only somewhat
agreed about the clear understanding of the skills and knowledge they were
expected to acquire.

Chart 3: Understanding of skills and knowledge expected to acquire

Count of understanding of skills






50.00% Service Engineer





Strongly agree Somewhat agree

understanding of skills

Thus, it can be concluded that managers have a less clear understanding of the
skills they are expected to acquire from the induction training as compared to the
service engineers. Clear objective statement and linking training to actual work
can help in removing these obstacles.

Briefing by HR department before the training

The following table indicates that more than 70% of the respondents only
somewhat agreed to the briefing conducted by the HR department before
induction training. This is also supported by the graph below. The proportion of
managers and service engineers was almost equal.

Table 2: Briefing by HR department before the training

Briefing by
HR dept manager Service Engineer Grand Total
Strongly agree 14.29% 14.29% 28.57%
somewhat agree 42.86% 28.57% 71.43%
Grand Total 57.14% 42.86% 100.00%

Chart 4: Understanding of skills and knowledge expected to acquire

Count of understanding of skills






50.00% Service Engineer





Strongly agree Somewhat agree

understanding of skills

A briefing by the HR department helps in understanding the objectives of the

training program. It also enables the trainees to link the training to the actual
work. Besides, the HR department can also provide information regarding
transportation and food arrangements for the trainees. This helps in developing a
positive attitude towards the training and the organization.

Quality of Induction Training.

The following table indicates that a higher percentage of the respondents (57%)
only somewhat agreed to the statement that the quality of training provided at
BSIL was excellent. About 43% strongly agreed to the statement that the quality
of training was excellent. More percentage of service engineers (28%) strongly
believed about the excellent quality of induction training as compared to
managers. This is also supported by the graph.

Table 3: Quality of Induction Training

Service Grand
quality of training manager Engineer Total
Strongly agree 14.29% 28.57% 42.86%
somewhat agree 42.86% 14.29% 57.14%
Grand Total 57.14% 42.86% 100.00%

Chart 5: Quality of Induction Training

Count of quality of trg






50.00% Service Engineer





Strongly agree somewhat agree

quality of trg

It can be concluded that a higher percentage managers only somewhat agreed to

the excellent quality of training offered. A better identification of training needs
at the manager level can provide a means to provide better response from the


Supervisor’s efforts to identify strengths and weaknesses

The following table shows that 71.43% of the respondents were only somewhat
satisfied with their superiors’ efforts to identify their strengths and weaknesses
as a part of the on-job-training. The remaining 28.57% were very satisfied by
their supervisors’ efforts.

Table 4: Supervisor’s efforts to identify strengths and weaknesses

supervisors identify strengths &
weaknesses manager Service Engineer Grand Total
Somewhat Satisfied 42.86% 28.57% 71.43%
Very Satisfied 14.29% 14.29% 28.57%
Grand Total 57.14% 42.86% 100.00%
Chart 6: Supervisor’s efforts to identify strengths and weaknesses

Count of supervisors identify s&w






50.00% Service Engineer





Somewhat Satisfied Very Satisfied

supervisors identify s&w

A substantial portion of the respondents were only somewhat satisfied with their
superiors’ efforts to identify their strengths and weaknesses. This identification
of strengths and weaknesses is a very important aspect of on-job-training. It not
only shapes the way a trainee develops practical experience, but also shapes his
or her attitude towards the supervisor and towards the organization.

Mentoring Received from seniors

The table below shows that more than half of the respondents (57%) were very
satisfied with the mentoring they had received from their seniors. The remaining
42% were also somewhat satisfied with the mentoring received. As indicated in
the graph below, a higher percentage of managers (42%) were very satisfied with
the mentoring as compared to the service engineers.

Table 5: Mentoring Received from seniors

mentoring from seniors manager Service Engineer Grand Total
somewhat satisfied 14.29% 28.57% 42.86%
very satisfied 42.86% 14.29% 57.14%
Grand Total 57.14% 42.86% 100.00%

Chart 7: Mentoring Received from seniors

Count of mentoring from seniors






50.00% Service Engineer





somewhat satisfied very satisfied

mentoring from seniors

The high percentage of very satisfied respondents shows that the mentoring
received at Blue Star is of high quality and the seniors are knowledgeable and
experienced employees.

Management support for employee’s efforts to improve

The table below indicates that 71% of the respondents were somewhat satisfied
with the managements support to the employee’s efforts in improving his or her
weakness. However, 14 % of them were somewhat dissatisfied to the
management’s support. An interesting fact is that all of the 14% were service
engineers. Mangers were generally satisfied with the management’s support.

Table 6: Management support for employee’s efforts to improve weaknesses

manager Service Engineer Grand Total
Somewhat dissatisfied 0.00% 14.29% 14.29%
Somewhat satisfied 42.86% 28.57% 71.43%
Very satisfied 14.29% 0.00% 14.29%
Grand Total 57.14% 42.86% 100.00%

Chart 8: Management support for employee’s efforts to improve weaknesses

Count of mgts effort to improve






50.00% Service Engineer





Somewhat dissatisfied Somewhat satisfied Very satisfied

mgts effort to improve

Though a substantial number of respondents were satisfied with the

management’s support, the fact that some were dissatisfied and all of those
dissatisfied were service engineers is a matter that needs to further inspection.


Relevance of the topic to job

The graph below shows that about combined together, 84 % of the respondents
found the course training to be relevant to their jobs on some or at a strong level.
Only 14% of the respondents remained neutral. All of the 14 % were managers.

Chart 9: Relevance of the topic to job

Count of relevance





50.00% Service Engineer





Neutral Somewhat relevant Very relevant


It can be concluded that the course trainings provided at BSL is very relevant to
the practical job. The functional, behavioral and Managerial training provided is
in line with the industry practices and also related to the roles and
responsibilities of the employees.

Level of Instruction

As indicated in the table below, 85% of the respondents felt that the level of
instruction at the course training was advanced. Only a 14 % felt that the
instructions were neither too basic nor too advanced. The respondents who felt
that the training was advanced consisted of equal percentage of managers and
service engineers.

Table 7: Level of instruction

level of instruction Manager Service Engineer Grand Total
Neutral 14.29% 0.00% 14.29%
Advanced 42.86% 42.86% 85.71%
Grand Total 57.14% 42.86% 100.00%

Chart 10: Level of instruction

Count of level of instruction






50.00% Service





Neutral advanced

level of instruction

The course training includes functional, behavioural, managerial and other

specific training programs. These courses are specially designed to meet the
customer and industry requirements. Even the trainees are specially handpicked
by managers. Hence, a certain level of advancement is expected from these
programs. The high level of responses favouring the advance level of the
programs is a good sign of the success of these specialised courses.

Lecture Coverage

The following table indicates that 71.43 % of the respondents felt that the topics
covered in the lectures of training courses were very comprehensive. All the
service engineers felt that the topics covered were very comprehensive.

Table 8: Lecture Coverage

lecture coverage Manager Service Engineer Grand Total
Comprehensive 28.57% 0.00% 28.57%
Very comprehensive 28.57% 42.86% 71.43%
Grand Total 57.14% 42.86% 100.00%

Chart 11: Lecture Coverage

Count of lecture coverage






50.00% Service Engineer





Comprehensice Very comprehensive

lecture coverage

The high percentage of respondents voting for the lecture coverage being very
comprehensive shows that the training courses at BSL cover all aspects of the
topic being covered. This provides the trainees with an in-depth knowledge of
the subject and makes them perform better in the application of the concepts.

Time allotment

The following figure indicates that 43% of the respondents felt that the time
allotted to the topics covered in the training courses were neither too short nor
too long. 28% of the respondents believed that the time allotted was long. All the
respondents in this group were managers. 14% of the respondents, all of who
were service engineers, felt that the time allotted was too long.

Chart 12: Time Allotment

Count of time allotment






50.00% Service Engineer





Short Neither Long Neither Short Long Too long

time allotment

Around 42% of the respondents (28% managers and 14% service engineers) felt
that the time allotted was more than required. The trainees are employees and
each hour spent is a cost to the company in terms of the productivity. Thus,
introspection in this matter would certainly help the company in reducing the
unproductive time of the employees.

Emphasis of detail

The following table shows that 42% of the respondents felt that the emphasis on
detail in the training courses was adequate. An equal percentage felt that the
training courses provided a detailed emphasis on the topic being covered.
14% of the respondents, who were all service engineers, believed that the
training courses provided too detailed emphasis on the topic.

Table 9: Emphasis on Detail


emphasis on details manager Service Engineer Grand Total

Adequate 28.57% 14.29% 42.86%
Detailed 28.57% 14.29% 42.86%
Too detailed 0.00% 14.29% 14.29%
Grand Total 57.14% 42.86% 100.00%
Chart 13: Emphasis on Detail

Count of emphasis on details






50.00% Service manager





Adequate Detailed Too detailed

emphasis on details

A high percentage of respondents (more than 80%) felt that the training
programs were either adequate or detailed. This is a good indicator of quality of
the training courses.

Practicality of Training

More than half of the respondents felt that the training programs were very
practical and directly related to the work that they were doing. This group had
equal representation from managers as well as service engineers in terms of
Chart 14: Practicality of Training Courses

Count of Treatment of topic






50.00% Service Engineer





Practical Very practical

Treatment of topic

One of the most important requirements of any training undertaken at an

organization is applicability of it in practical situations. The trainee should be
able to relate the topic to the daily work activities and apply the concepts to
increase the productivity and customer satisfaction. From more than half of the
respondents voting for the training being very practical, it can be concluded that
courses directly affect the performance of the employees in their daily activities.


The survey results show that most of the employees are satisfied with all the
three types of training available at Blue Star. The training has given a new tool in
employee’s hands to deal with the day to day work activities and face
challenging problems effectively and efficiently. The training has also provided a
new path to their careers by providing them practical knowledge.

The most important concepts learned from the training programs, as identified
by the employees, were as below:

 Team Work
 Business Communication
 Time Management
 Factory visits and practical problem

6. Training Practices at Blue Star’s


An inordinately hot summer in 2010 appears to have convinced the people the
comfort of an air-conditioner and a large number appears to have decided to take
one home this year. Indeed, in the last few the years, the demand for air-
conditioners from the household sector has been growing rapidly. Still, the
demand growth in 2000 was particularly noticeable, and was also the most
significant change in the industry during this period.

According to some industry estimates, growth in volume terms has been 45-50
per cent this fiscal. But official statistics underestimate this and even report a
decline in production. Nevertheless, by all accounts, including a study by the
Confederation of Indian Industry, there has been a noticeable jump in the
demand for air-conditioners from the household segment.

After several years of relatively modest growth, which was totally at variance
with the latent potential of the product, the sharp growth in demand the summer
past was very welcome for air-conditioner companies in many respects. One, it
relatively reduced their dependence on the corporate sector which is still the
major demand driver. Corporate traditionally accounted for about 60 per cent of
the total demand for air-conditioners. But the burgeoning demand from the
household segment could level the ratio in the near future.
Moreover, the demand growth comes at a time when the industrial investment
climate is still sluggish. Barring the investments made by software and
healthcare companies, industrial investments continue to remain on hold. In this
backdrop, the response of the household segment must have been most welcome
for the air-conditioner industry.



In 2008-09, the estimated total market size for air-conditioning in India was
around Rs. 10,250 crores. Of this, the market for central air-conditioning,
including central plants, packaged/ducted systems and VRF systems was about
Rs. 5750 crores, while the market for room air conditioners comprised the
balance Rs. 4500 crores. The commercial air-conditioning segment catering to
corporate and commercial customers amounted to around Rs. 8000 crores.
During the year, the economic slowdown coupled with the liquidity squeeze
affected certain segments such as retail and builders. Project expansion plans in
the IT/ITES segment were
also delayed mainly due to
the uncertain impact of the US
recession on this segment.
However, the air-conditioning
market witnessed significant
growth in segments such as
hospitality, healthcare and
education. In addition,
infrastructure segments such
as airports, power plants and
metro rail were unaffected by the economic downturn and project plans were on


The market for commercial refrigeration equipment and systems was estimated
at around Rs. 2000 crores. The commercial refrigeration segment includes a wide
range of products such as cold storages, supermarket refrigeration equipment,
water coolers, bottled water dispensers, deep freezers, milk coolers, bottle coolers
and ice cubers. In the present scenario, the cold chain infrastructure is
characterized by long and fragmented supply lines leading to high wastage. The
major constraints on the development of the cold chain industry are high capital
cost and electricity bills coupled with low rental revenues and inadequate
availability of concessional finance. Based on the recommendations of ‘Cold
Chain Summit 2007’ organized at New Delhi by the Confederation of Indian
Industry jointly with the Department of Agriculture and Co-operation
(Government of India), a task force was constituted for creating a road map for
cold chain development in this country. The task force proposed creation of a
‘National Green Grid’ to develop a seamless cold chain network to balance

demand and supply issues with remunerative price to farmers and to deliver
quality produce in the hands of consumers. The task force initiatives are at an
advanced stage and with the introduction of structured fiscal incentives and fast
track clearance for economically viable proposals, the size of the cold chain
industry will increase substantially in the next few years.

The industry can be sub-divided into non-ducted and ducted products. The
demand for non-ducted products -- window air-conditioners and mini-splits --
comes from both households and corporate. The demand for ducted products --
central plants, packaged air-conditioners and ducted splits -- is only from the

Non-ducted ACs, the growth driver

The demand for non-ducted products grew steadily in the latter half of the 1990s.
The demand for mini-splits has grown at a higher rate compared to window ACs
because of the lower base. The demand switch from mid-sized ducted products,
such as packaged ACs or ducted splits, to mini-splits is also one of the reasons
for the larger growth rates in the latter segment.

Another major reason for the growth in demand was the increased attention this
product category has attracted in the recent past. Prices of air-conditioners
dropped sharply in the past few years because of competition. Most established
players upgraded their manufacturing facilities, while fresh capacities were
created by companies such as Matsushita (National brand). The marketing and
advertisement spend by companies has also been on the rise.

With such investments flowing into building both the product and the brand, the
expansion of the market was inevitable. As seen with other consumer durables,
in the initial years of increased intensity of competition, more cash gets invested

by both existing and new players. This leads to a drop in prices, fuelling demand
and the result is a much larger market.

And the non-ducted segment has attracted a lot of players in the last few years.
The latent long-term demand potential from Indian households has led to a
number of multinational companies making a beeline to set up base in the

Major players in this product category are Blue Star, Hitachi, Videocon, Lloyd
Electric, Hitachi Home, IFB Industries, Fedders Lloyd and Godrej. Among the
recent entrants, the Korean brands such as Samsung and LG have been able to
make an immediate impact. Other brands that have positioned themselves for a
share in this fast-growing market are National, Fuji General and Daikin. On a
much smaller scale, Whirlpool and Electrolux have entered the market to cater to
household demand.

Table: Sales turnover figures for Blue Star and competitors

Sales Turnover (In Rs. Cr)
Company Year 2009-10
Blue Star 2,549.43
Lloyd Electric 680.81
Hitachi Home 642.54
IFB Industries 545.34
Fedders Lloyd 465.95

Chart: Sales turnover figures for Blue Star and competitors

Sales Turnover For Year 2009-10


Sales Turnover in Rs. Cr


1,500.00 Sales Turnover



Blue Star Lloyd Hitachi IFB Fedders
Electric Home Industries Lloyd


Lloyd Electric & Engineering Limited is in the business of manufacturing Heat

Exchanger Coils for air-conditioning and refrigeration application, ' U ' bend and
return bend for heat exchanger coils, system tubing and header line for air
conditioner equipment and sheet metal items for air conditioner systems made
from CNC presses and are leaders in India. The company is OEM supplier to
almost all AC manufacturers in India, and have overseas business of
approximately 20% of its sales turnover. The heat exchangers are made out of
Aluminum and Copper Fin stock and Copper tube, having facility of using pre
coated Fin stock and in house facility of painting and tin plating.

Skilled and qualified workforce has been Lloyd Electric’s key asset and has
helped the organization significantly improve productivity over the last 5 years.
The credit goes to the engineering expertise and technological skills developed
over the last decade, and an innate penchant for excellence which is unique to
the Lloyd human resource. They call it a human machine nexus committed to

 Emphasis on training across all levels of the organization

 One on one relationship between workers and management
 30% improvement in productivity over the last 5 years
 20% Engineering graduates employed across all functions
 Qualified and experienced technical staff
 No industrial disputes since inception


Hitachi Home & Life Solutions (India) Ltd. (HHLI), a subsidiary of Hitachi
Appliances Inc, Japan, is a listed company at BSE & NSE exchanges. Since its
inception HHLI has focused on developing and supplying high-quality products
and technology that contribute to the overall prosperity of the society, HHLI
manufactures various kinds of products including Room Air-conditioners and
Commercial Air-conditioners, and are into trading of VRF Systems, Rooftops,
Chillers, and Refrigerators.

The number of Staff and Operators at HHLI as on March 31, 2009 was 492. This
year, on an average around 15% of Staff was part of Trainees’ pool. The Trainees
were given In- Plant training at Kadi Works before deployment to various
departments for “On the Job” Training. For Employee Health and Safety,
OHSAS implementation was initiated at Kadi Works. A series of functional
Training Programs were organized for enhancement in various skill sets.
Training on Packaged Type Air conditioners was the major focus for field teams
of Sales and Service. A Three day Personal Development program was
conducted for the Trainees who have been confirmed and are placed at various
locations. This helped in a unique bonding among the young graduates who are
getting challenging assignments at HHLI. This year’s “Annual Employee
Satisfaction Survey” was conducted in October-2008. The analysis was shared
with all Department Heads and corrective actions are being taken to improve on
low scores. Improvement in scores was observed in most of the areas of
Employee satisfaction from last year.

At Hitachi, Ltd., personnel system is designed to assess the strengths and

achievements of employees fairly and transparently and to reflect these findings
in salaries and bonuses. Elements, standards, and methods of evaluation are fully
disclosed as employees meet their evaluators to arrive at a shared assessment. In
the course of these discussions, employees receive feedback on their strengths
and weaknesses as well as guidance on achievement of business goals and
capacity building. An evaluation manual is used to minimize disparity. As a
further step, employees are surveyed annually to review the evaluation process,
and follow-up work is done to ensure proper management.

Because we believe that maximizing employee potential is vital for continuing to

provide new value, we work hard to improve employees’ abilities and their

Employee Capacity Building

For capacity building, we supplement in-house education based on on-the-job

training with an elaborate training system. This training consists of six
educational programs:
• Management Development
• Education for Engineers
• Production Worker Training
• Education for Internationalization
• Sales Education
• Training by Job Function

These programs are offered across the Hitachi Group in conjunction with
educational institutions such as:
 The Hitachi Institute of Technology,
 The Hitachi Institute of MONOZUKURI Skills and Engineering
 The Hitachi Institute of Management Development.

In addition, in order to expand educational opportunities for employees, Hitachi

has also developed a unique e-learning system (in Japanese, English, and
Chinese) for Group companies.

Career Development Workshop: Supporting Career Development

The objective is to create an environment where employees can discuss their

careers with their supervisors to deepen mutual understanding between both
parties and enable both to tackle their jobs with a clear vision. This development
support program is designed to foster independent human resources. It helps
participants achieve self-realization, enabling them to develop a deeper self-
understanding, including their reasons for working, living and their work
values, as well as how to set their personal career goals.

Global Manager Training: Global Fundamental Course

With the operations taking on an increasingly global perspective, it is absolutely

critical that the domestic and overseas managers working on the frontlines of
global business understand our history, founding spirit, company operations,
common values, corporate philosophy, and basic management skills. To instil
this understanding, we operate a four-day course, Global Fundamental Course—
Ready to Inspire, which offers the same training to all Hitachi managers around
the world.

Training for Strengthening Communication Skills

To revitalize workplace communications, we started a training program in 2008

for managers to strengthen their communication skills. To promote diversity and
good interpersonal relations based on trust—as well as to achieve organizational
goals—we stress respect for individuality and differences of opinion and culture,
while seeking a full consensus. The hands-on training during the two-day
program focuses on communication skills that are the basis for all interactive
skills: active listening, essential for mutual understanding; and assertion, which
allows people—after opinions and ideas are expressed—to reach a conclusion
that all parties can accept.

The Lloyd Group (Brij Raj Punj Group) is a US$ 500 million group in India. The
group is recognized as the pioneer and well established name in the field of Air
Conditioning in India. The Group consists of many companies with diversified
portfolios with active involvement in many business ventures consisting of
manufacturing in Air Conditioning Industry, Chillers, Manufacturing of Heat
Exchange and Radiators, Sheet Metal Fabrication, Scaffolding &Formwork,
Structural Steel Fabrication, Pre-engineered Buildings (PEB), Cable and Storage
Management, Vehicle Variants like Load Bodies, Water Bourses, Petrol Tankers
and Light Recovery Equipment etc. Besides, it also has active stakes in the fields
of Information Technology (IT) and Development of Housing and Commercial
The Company appreciates the dedicated and committed performance of its
employees. It believes in healthy work environment and maintains cordial
relations with the employees. The Company continued its focus on acquiring and
developing its human capital. The management highly values the productive and
high-performing employees and considers the company's valuable assets in
building up the organization. The Company place emphasis on enhancing the
skills and capabilities of the employees and persists on training, re-training and
development of its work force. The Company's focus is not only to impart
adequate training but also to provide the right environment to maximize
productivity and growth potential.
The Company believes in the culture of trust and continuous learning for its
growing human capital so as to ensure a continuous enhancement in business
value and thereby enhancement in shareholder value. Various training programs
are offered to the employees as listed below:
• Knowledge Training,
• Skills Training,
• Behavior Training and
• Overall organizational development Training.
The atmosphere in the organization is performance driven where HR puts its
efforts to identify potential performers. The Company maintains sound and
cordial relations with employees at all levels.
The functions of HR department in the training and development fields are as
• Coordination with concerned departments and employees as per training
• Keeping record of the participants in the training
• Collection of training feedback from the participants on the conduct of the
training and its usefulness.

7. Annexure
A. Questionnaire
Training Evaluation Form
Personal Details

Experience (In years):
Year of Joining Blue Star:

Please fill in the below tables with your responses regarding the various aspects of
training at Blue Star Ltd. This information is valuable in helping the organization to
know how satisfied you are with the training available. Please tick your responses by
marking a tick in the appropriate cell. Please consider your responses carefully and
answer truthfully. Everything you say will be held in strictest confidence. The
information will be used only to help us make this training activity more responsive to
your needs.

Part 1:Induction Feedback Sheet

Strongly Somewhat Agree Somewhat Strongly
Agree Agree nor Disagree Disagree

Induction training
is of adequate

The induction
training is
evaluated and

Strongly Somewhat Agree Somewhat Strongly
Agree Agree nor Disagree Disagree
Employees are
sponsored for
programmes on
the basis of
carefully identified

sponsored for
training go with a
understanding of
the skills and
knowledge they
are expected to
acquire from the

The HR department
conducts briefing
and debriefing
sessions for
sponsored for

programmes are
handled by
competent faculty.

The quality of in-

programmes in
your organisation
is excellent.

Please use the space below to indicate any suggestions you might have that will help us to
improve the facilities and administration


Part 2: On Job Training

Please fill in the below table with your responses regarding the various aspects of
On-Job- Training at Blue Star Ltd.

Very Somewhat Somewhat Very

Neutral N/A
Dissatisfied Dissatisfied Satisfied Satisfied

Supervisor's efforts to
identify your strengths
and weaknesses

The quality of
orientation and
training received for
your current position
in the company

The quality of
orientation and
training received for
your current position
in the company

The mentoring you are

currently receiving
from senior peers

support for my efforts
to improve my

Please use the space below to indicate any suggestions you might have that will
help us to improve the facilities and administration



You must have completed certain training courses at Blue Star. We would like
you to tell us about your feelings on these courses. This information is valuable
in helping us make following training sessions more interesting and useful to

Training provided on: (Please tick on the appropriate circle. You can select
multiple trainings if applicable)

o Functional
o Behavioural
o Managerial
o Others ( CIP )

1. Relevance of the topic to

Not relevant Relevant
your job
1 2 3 4 5

2. Clarity of the module's

Not clear Very clear
1 2 3 4 5

3. Level of instruction Too basic Too advanced

1 2 3 4 5

4. Lecture coverage comprehensive
1 2 3 4 5

5. Time allotment Too short Too long

1 2 3 4 5

6. Emphasis on details Too brief Too detailed

1 2 3 4 5

7. Organization and direction Disorganized Well organized

1 2 3 4 5

8. Treatment of the topic Abstract Practical

1 2 3 4 5

Please state the three most important ideas or concepts that you have learned from the
training sessions in the organization.




8. References





Diana M. Osinski, SPHR February 1996 Reviewed July 2002.

• “Human Resource Management” By Ashwathapa