People & Organization

Assignment 05 Group Work

Organizational Behaviour of a selected local company

By Group Bs

Aim of the Assignment

To understand the usage of management principles in practice and the Behaviours in a organization operating in Sri Lanka

Presentation Flow

Introduction Literature Survey Ceylon Tobacco History Start of a new journey Management principles in practice Critical evaluation of management principles in practice Conclusion Our observation Bibilography A big thank to CTC HR Team

Introduction

Ceylon Tobacco Plc

The Ceylon Tobacco Company is a subsidiary of British American Tobacco headquartered in Colombo, Sri Lanka. Companys factory located in Colombo & Kandy. Ceylon Tobacco manufactures and markets cigarettes and smoking tobacco and operates primarily in Sri Lanka. It employs approximately 325 people. The company recorded revenues of LKR46,827.1 million (approximately $425.2 million) in the fiscal year ended December 2007, an increase of 9.5% over 2006. Its net profit was LKR1,894.2 million (approximately $17.2 million) in fiscal year 2007, an increase of 28.6% over 2006. Its brands include; Dunhill, John Player, Gold Leaf and Pall Mall. Its subsidiaries include; - CTC Services Limited, CTC Leaf Exports

Ceylon Tobacco Company

Depots Leaf growing Manufacturing
Burley (North) ) Burley (North
Anuradhapura

Yala Areas Yala Areas

Market Leader Volume & Value 84% BAT Share holding

GLTP Kandy

Mahiyangana Ududumbara

Colombo Plant

Nildandahinne

Haliela
Buttala

325 Employees

Maha Areas Maha Areas

Burley (South) Burley (South)

British American Tobacco Parent Company

BRITISH AMERICAN TOBACCO BAT

British American Tobacco at a Glance

Fortune 500 Company In business for over 100 years Over 300 brands being sold in 180+ countries Leadership in over 50 countriesIncl. PAK 47 factories in 40 countries 53,907 + employees- around the world Supporting 280,000 farmers in 23 countries

Gross Turnover Operating Profit Tax Contribution 26,234mCeylon Tobacco Plc 2,905 m 16,216m

Literature Survey

What is Management

Management in all business and organizational activities is the act of getting people together to accomplish desired goals and objectives efficiently and effectively.

Management comprises;

Planning, Directing, Organizing, & Controlling

Management Theories

The management theories and approaches are as follows; - Classical approach - Human approach - Modern approach -

Management Theories

Classical Approach

Classical perspective to management emerged during the nineteeth century and continued into the twentieth century. Due to the challenges organizations faced management methods of efficiency which included a rational and scientific approach. Scientific Management by Fedrick Taylor Administrative Principle by Henry Fayol Bureaucratic Organization by Max Weber

CTC History

CTC Journey so farHistory 15 Years back

Company with lot of labor disputes Dominant/ aragont union both in management and labor level Lack of transparency in Management processes Misaligned thinking between management and workforce Aggressive management style- Controlling employees with the help of Army and Police Highly influenced by External political environment

CTC Journey so farBusiness impact

Decline in sales volumes by 25% 30% Critical impact on the bottom line Inability to cater to growing volume demand Productivity lowest in sub continent High employee numbers and cost Unpleasant working environment Industrial Actions/ disputes Product shortages disruptionsetc

CTC Journey so farCritical issue

Evidence of failure in Leadership and Proper Management practices

Poor organisational performance in a changing business environment

Start of a New Journey. change

What have they done.

Formed a cross functional team representing all levels Conducted many brainstorming sessions to understand the root causes Employee opinion was represented Leadership team took the responsibility and lead for change Change principles were properly communicated with a robust communication plan

Credible Change Philosophy.

Achieve commonality in thinking and mindset Management Unions Establish key processes Education Communication Consultation Workforce

Decisive action & implementation

Workshops Training

Building Structured through in Trust Involvement Surveys Regular

egnahcl an dui tt A i t

Effective Execution Link rewards to business results and performance Credibility Co performance Productivity Quality
Social Upliftment Common facilities Family events Social events

decision making Informative Empowerment Relevant Transparency Feedback Two-way

Recognition & opportunities for union leadership

Journey at a glance ..
16000 14000 12000 10000
700 1300

1100

900

Volumes in Mn & CPMH

8000
500

6000 4000 2000 0

1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 YTD 300

100

-100

No of Employees

Volume in Mn

C.P.M.H

Management principles in Practice.

Key Management practices implemented.

Well accepted organizational strategy Robust communication process Talent development philosophy Rewards Philosophy Performance management process Common Employee Relations Strategy

Communication Process
BAP St.Plan EXCO / OPCO

COPLAN Cascade

Valued Business Partners

Departmental Team Briefings

Stakeholder s

All Employees

Small Group Meetings

Other means of Communication

Electronic
Internal electronic mail system (Lotus Notes) CTC Bulletin Board Desktop - Internet facility Interact

Broadcasting System
Sun Rise News

Company Notices

Cross Functional Project Teams

Productivity Improvement teams KAIZEN teams Food committee EHS committee CA team BCP steering committee etc. e v

at s tr on em D

in e

at i iti

Delivering CTC Priorities

V ISION
To be THE inspiration for Corporate Excellence

Growth

Productivity Integrated and Demand driven SC Productivity Acceleration

Responsibility Shape regulatory environment Enhance Reputation

St r a t e g ie s

GDB Growth TM focused S&D Model CD aligned Marketing Organization

Extended Supply Chain from Seed to Retailers

Long term Excise Strategy

Winning Organization Developing Extraordinary People whilst Creating A Great Place o Work !

Winning Org Strategy

CTC Role

To maintain market leadership in order to deliver on reliable and sustainable growth in UOP , OCF and GDB's .

TO HAVE OUTSTANDING PEOPLE AND TO BE A GREAT PLACE TO WORK TO DELIVER EXCELLENT BUSINESS PERFORMANCE

Prioriti es

W/O Role

Healthy Talent Pipeline

Employee expectations & Future sustainability

Organisational Design & Culture

HR Priorities

Strategy

Leadership & Talent

Organisation

Culture

Reward

Create sustainable Create an agile, fit for purpose organization & inspire people to Drive for high performance & Lead change perform talent pipelines with leadership at all levels motivation

Strategy in Execution

-Employee Brand -Recruitment Strategy -On Boarding Process

- Above Market Initiatives -Outsourcing -

Transforming the talent philosophy

Conventional approach Transformation approach

Build short term individual competencies

Build long term organisational capabilities

Personal Development for current role

Personal Development for current role, future career & external marketability

Life time career within CTC & BAT by exception

Clearly defined career paths CTC. BAT & External

The Leadership Pipeline

rise Enter p er Manag Gr ou Ma p na ge r ess Busin anager M Func Ma tiona l na ge r ger of Mana er M ana g Ma na ge Ot he rs e Manag Se l f

Passage #6

Passage #5

Passage #4

Passage #3

Passage #2

Passage #1

7 Drotter Human Resources, Inc.

Example : Leadership Passages

Passage 3 : Manager of Managers Leads a team of managers, who themselves lead people. Time:-almost entirely about others- repeating the -instruction-performance-feedback cycle Passage 4 : Functional Manager Leads function, up to two leadership layers distant from individual contributor level, cross-functional view. Time: - participation in business meetings/ strategy sessions working with other functional managers -delegating of much of the functional concerns to direct Values:- identify value-based resistance to Values: leadership work- be prepared to return people reports - understand and value foreign work - benchmarking as a networkingindividuals in other to individual contributor work if they cant - value working and team with make the shift in values/ capabilities functions Capabilities Capabilities: - managerial maturity thinking/ acting as leader not :- pure leadership - communication through layers manager areas outside own experience selecting people to take passage one - managing assigning managerial and leadership work measuring and coaching managers thinking beyond function for the first time holding first line managers accountable for managerial work managing the boundaries between own and other units - report to multi-functional person - understand resourcing decisions across different business requirements - strategist beyond function - longer term thinking - delegate responsibility for overseeing functional tasks to direct reports - driving state of the art functional strategies to gain competitive advantage

BAT Competencies
BAT Leadership Capabilities Functional Capabilities

Supply Chain Marketing Finance CORA HR IT

Training Programmes

Manage Managers Manage Others

Change Mgt Skills

ELP

Assessor Training

SCQuARE

Negotiation Skills

PRINCE2

MDC

Manage Self / Others Manage Self

Are You In Control ? 7 Habits for Highly Effective People

CORA Appreciation

7 Habits for Managers

Product Knowledge

Language of Finance

Communication Skills

Influencing Skills

Resource Mgt

Executive Development

Company Induction

Total Reward Elements

Financial Rewards

Base Pay Variable Pay (Cash bonuses)

Recognition Responsibility Learning & Devp Career Opportunities TOTAL REM NON FINANCIAL REWRADS

+
Benefits

Contingent Pay For performance, contribution (Battle Field)

International Exposure Autonomy Work Environment Quality of Work Work-Life Balance

Medical Transport Loans Bungalows Cigarettes Self Study Club Membership ETC.


Performance Indicators Productivity

Productivity Related Bonuses

Stage 1 Rs.900 Stage 2 T2 Rs.990 Stage 3 T3 Rs.1,080 Stage 4 T4 Rs.1,200

Sub Element

Modular Output T1 Manu. Accuracy Dashboard (%)

Quality MQI

All Brands CMB

Profit sharing
Company Performance Measures Operating Profit Volume Share Cash Flow GDB Volume Net Turnover Total Weightage Company Bonus Allocation based on overall company performance (months of salary) Threshold Target Normal Max Extra Max 0.2 0.2 0.2 0.2 0.2 0.2 0.4 0.4 0.4 0.4 0.4 0.4 0.6 0.6 0.6 0.6 0.6 0.6 20% 20% 20% 20% 20% 100%

Team work agreem ent s

Tech-Operator concept BE recommendations

The Performance Cycle

FEEDBACK Performance Planning

Beginning of Year 15 Feb

Enabling Performance
During Year On going Mid Year Review July

Performance Review
End of Year 31 Jan

Common Facilities

ov em

gh in

Canteen Car Park Time Entry Open Office l ica Search h ar c r ieProcedure

ba

er s rri

rea C

ne ow ing t

hip rs

Union official cascading the CoPlan

Union Representation

for ties towards society Responsibility uni ort ip pp s h & o der tion lea Suppliers briefed gni THE o H ec W IT R S TY I ING
N N AR MMU E G L R CO IN AR WIDE SH

ion un

Children's Party

ga tin mo Pro

ily fam

ure ult c

Annual excursions

din uil

re g

ns tio la

ips h

it w

all h

CTC Sports day

ion at ni z rga

S e n i

En

ing giz er

eo th

Critical Evaluation of Management principles in Practice.

Critical Evaluation Positives

CTC was able to Achieve Operational Excellence in all segments It transformed to a award winning Company It became a talent source for Global BAT Productive and harmonize work force One of the best socially responsible organization with high CSR spent

Critical Evaluation Negatives

Los of employment due to periodic restructuring (1800 300) Aging work force creating a life time employment ( Non management) Standardize global management decisions not applicable to local environment Employment principles for senior management disrespecting social values

Conclusion.

Our Observations.

During our study research we have found that CTC;

In the past went thru many difficulties due to dominant management & employee behaviours. After the change management process CTC went thru for two decades and the implementation of the current management principles the organization has achieved its operational excellence giving high share holder returns and global recognition. A good simple example that can prove our statement here is the share value from Rs.15/- then to Rs.365/- today (within a decade of time).

Achievements
MRPII - 1 st in the World to be certified in V5 All chapters

WORLDAWARE Award for SALT Project

Gold Zero Accident Award & The Gold EHS Merit Award

Achievements..

First Corporate Social Responsibility Award, Awarded by ICASL

Achievements..
Category 1 CSR in Employee Relations

Category 2 Being in the top ten Companies for the Best Corporate Citizen

PRIZE

1st

Won the

Award for the

Best Trade Union promoting Employee Involvement In Quality & Productivity

National HRM Award

Winner - Most Innovative HR Award

Practices

Winner - Large Manufacturing Sector Award

Critical Evaluation Positives

2006 Profits 10 Turnover 33 Market Share 94 Productivity 410 Illicit Cigarettes 45Mn Talent Export 8 People CSR Spent 2 MN GBP

2009 30 56 97 299 74Mn 30 People 7Mn GBP

Growth 33% 59% 3% 137% 60% 27% 28%

Bibiliography

http://en.wikipedia.org/wiki/Management#History http://hbr.org/ http://www.hbrsolutions.com/itofferings.html Fred Luthans, Organizational Behaviour, 11th edition, McGraw-Hill International edition

A big thank to HR Team at the Ceylon Tobacco Plc

Bs

Thank You..