MANAGING ORGANISATIONAL AND

MANAGEMENT CHALLENGES IN
INDIA

PREPARED BY
VIJAY PORWAL

ADITYA DESHMUKH

NTPC SIPAT

NEELAM

Managing Organizational and

Management Challenges in India
ABSTRACT
Organizations are confronting a wide range of organizational challenges presented
by new economic and social trends. Understanding organizational challenges are at
the heart of strategic plans. There are challenges everywhere both in and outside
the organizational boundaries. Clarity of challenges enables an organization to
assess probability of achieving goals, and formulating plans to remove the road
blocks on the way, identifying latent opportunities in the challenges- challenges are
a pack of hidden opportunities. Organization challenges when addressed proactively
provide a company with opportunity for creating future else can spell a disaster.

INTRODUCTION
In the last two years entire globe was full of economic turbulence. Latest Euro zone
crisis has once again shaken off the world. Complete fiasco, started by crash of
Lehman brothers, teaches a lesson of management.
The global economic crisis has slowed Indias growth but it has not curbed the
potential of its strongest home grown companies. The growth of Indian
multinationals is becoming a subject of discussion in corporate board rooms in the
USA and Europe. Leveraging the nations comparative advantage of knowledge,
Indian companies has grown through acquisitions, built best in class competency
and become large scale players. But this growth can be marked as outcome of
initial reforms implemented by government, Indias population dividend and great
Indian middle class consumers. But the road ahead is much more complex than
ever. To survive in long term they have to think differently, The nation has to add
value by creating new products services and processes by radically altering the way
it does business.
There are times when organizations are quite relaxed when every thing about the
company are in harmony with outside world around it. The business situations are
familiar and company is well organized. These are the times when organizations are
complacent about their leadership position in the industry, Take IBM for instance
which surprisingly could not sense the drastic changes occurring in the market
place, where there was a distinct shift in technology from mainframe to client server
technology and customer preference to use personal computer instead of
terminals.

Companies must question the basic premises of the way they do business even
when they are doing well. How to simulate further growth, how to end bureaucracy,
what drive customer satisfaction.
What is so special about long lived companies? all happy families resemble one
another Tolstoy writes in Anna Karenina, but each unhappy family is unhappy in
its own way, what we have come to call living company has a personality that
allows them to evolve harmoniously. A survey conducted by executives of Royal
Dutch Shell shows that there are only few companies which survived more than 100
years. In the 27 survivors four common personality traits has been shortlisted that
could explain their longevity.
Conservatism in financing: They understood the meaning of money in a old
fashioned way. They knew the usefulness of spare cash in the kitty. Money in
hand allowed them to snap up options when their competitors could not.
Sensitivity to the world around them: Whether they had built their fortunes
on knowledge or on natural resources, the living companies were able to adapt
themselves to changes in world around them. As wars, depressions, technologies
and politics surged and ebbed, they always seemed to excel at keeping their
feelers out, staying attuned to whatever was going on.
Awareness of their identity: No matter how broadly diversified the
companies were, their employees all felt like parts of a whole. The feelings of
belonging to an organization and identifying with its achievements is often
dismissed as soft. But case history repeatedly show that a sense of community is
essential for long term survival.
Tolerance of new idea: The long lived companies tolerated activities in
margin: experiments and eccentricities, that stretched their understanding. They
recognized that new businesses may be totally unrelated to existing businesses
and that the act of starting a new business need not be centrally controlled
These four traits form the essential character of companies that have functioned
successfully for hundreds of years. Given this basic personality what priorities, do
the managers of living companies set for them selves and their employees?
The manager of a living company understand that keeping a company alive means
handing it over to a successor in atleast the same health that it was in when he/she
took charge. To do that a manager must let people grow within a community that is
held together by clearly stated values. The manager therefore, must place
commitment to people before assets, respect for innovation before devotion to
policy, the messiness of learning before orderly procedures and the perpetuation of
the community before all other concerns.

Most Pressing Challenges

Companies around the world are struggling to confront the organizational
challenges presented by global trends such as growing competition for talent,
shifting centers of economic activity, and an increasingly networked business
environment, a McKinsey Quarterly survey shows. Although the challenges are
manifold

Top Organizational Challenge presented by given business trend

Trend
New global industry structures will
emerge
Technological connectivity will
increase
Role, behavior of business will come
under increasing scrutiny
Growing competition for talent both
technical, managerial
Organization will become larger,
more complex
Ubiquitous access to information
will change economics of knowledge
Demand for natural resources will
grow, as will strain on environment
Thrust on total quality
Consumer landscape will change,
expand significantly
Centers of economical activity will
shift globally, regionally

Top Challenge
Creating, capturing value from
networked business
Developing ability to change
organization, operating model quick
enough to keep pace with technological
change
Improving enterprise-wide riskmanagement processes
Dealing with shortages in specific skills
Increased speed of decision making,
response to external changes
Ensuring information, knowledge wisdom
are shared across business as quickly,
effectively as possible
Managing operations in a way that is
environmentally sound
Achieving efficient production by
following various international standards
Managing complexity of tailoring
products or services to different local
conditions, preferences, without diluting
the brand
Managing an organization with
operations at different stages of growth,
market development

Building core competency:

Core competency is company collective knowledge about to co-ordinate diverse
production skill and technology. In a tree trunk and major limbs is core product,
small branches as business unit, leaves & fruits are end product, then root system is
core competency which nourish and stabilize everything. Focusing on core
competency create unique, integrated system that enforce fit among yours firms
diverse production and technical skills

Casio core competency with display system lead it to success in calculator,

laptops & car dashboard

Honda competency in light weight engine offers multiple consumer benefits

First identify yours core competency then check whether they are yours true
competencies are not with 3 point method.
1. Relevance--- Competency must give your consumer something that strongly
influence to choose your product or service
2. Difficulty to limitation---- Core competency should be difficult to imitate , this
allow you to provide product that are better than your competition and
because you continuously working to improve this competency , it means you
can sustain your competitive position

3. Breadth of application---- It should be something that opens up a good

number of potential market
Normally institution use variety of training methods to attain sufficient level of
competency.

Developing Organizational Culture Best HR Practices

The best employers inspire and maintain a passion for outstanding achievement.
They not only pose sharp focus and clarity but also share it simply and effectively
with employee.
-Mike Bennette, Managing Director,
Asia Pasific
All 27 long surviving companies discussed in Shell survey changed its business
portfolio atleast once. DU-PONT which is 200 years old started out as Gunpowder
Company. In the 1920 it was major share holder of general motors and now DUPONT is speciality chemical company. Those histories tell me that such companies
are willing to scuttle assets in order to survive. It is the people within the company
who drive it towards greatness not just brands or financial muscle. If you have good
people on board you can get money, but it doesnt necessarily work other way
round.
Organizational culture is the way in which an organization performs its tasks, the
way its people think, feel and act in response to opportunities and threats, the way
in which objectives and startigies are set and decisions made. Enabling
organizational culture is a vibrant and dynamic organizational culture, where
employees offer co-operation to one another , remain committed to their
organization and value customers. And fostering such enabling organizational
culture is the greatest challenge, which organizations are facing today.
Plethora of the survey has been conducted to determine factors behind enabling
organizational culture. Following are the major cultural enablers we have listed out.

Developing human capital

Leadership development

Transparent and sincere communication system

Motivational factors rewards and compensations

Shared vision, mission, values and objectives

ENVIRONMENT, SAFETY AND CSR:

Environment:-This new environment era is a real challenge for companies which
now have to find a way to deal at the same time with economic growth and
environment protection .Company have to take proactive step to improve their
environment practice at each stage of there supply chain
CSR: - CSR can be defined as the economical, legal, ethical and discretionary
expectation that society has of organization at a given point of time
SAFETY: - Its employer responsibility to maintain safety discipline at work place
and to ensure safety of employee, which required safety equipments and safety
trainings

TQM for global competition: Total quality management is a systematic

Management approach that fosters Continuous improvement culture in the
organisation by involving all stakeholders aiming at Business Excellence.

THE TQM TRIANGLE

(Customer Focus)
Quality

TQM

Scientific Approach

All one team

(Process Focus)

(People Focus)

T: A.V.Feigenbaum Q: W.Edwards Deming

M : Dr Juran

By H.A.Kashfi , ASQ
partha

Objective:-

Meeting costumer requirements and the key to organization survival and growth

Contentious improvement of quality , the management should stimulate the

employee in becoming increasingly competent and creative

It is a process of embedding quality awareness at every step of production or

service while targeting the end customer. Competition is getting harder and
becoming global .Companies now have to be more responsive of offer a better
product and keep improving .TQM increase customer satisfaction by boosting
quality, It does this by motivating the workforce and improving the way company
operates. In the increasing market, firms with a continuous improvement culture
and external force are more likely to survive and prosper

KNOWLEDGE MANAGEMENT
Knowledge management involves strategic & process of identifying, capturing &
leveraging knowledge to enhance competitiveness.
It is an introductory step it is useful to distinguish between raw information and
knowledge .Raw information may be widely available to the number of agencies but
only some organization well is able to convert this information in to relevant
knowledge and to use this knowledge to achieve their aim. The process by which
they do this is known as knowledge management strategies.
Knowledge management strategies aim to increase the organization capability to
think creatively and act innovatively so challenges and advantages of knowledge
management are naturally related to challenges and advantage of organization
learning. Many organization look knowledge management as a solution to the new
challenges of the information age

KEEPING ABREAST WITH IT

One cannot compete successfully in global market unless he can reveal business
information from many sources. Today business environment is very unpredictable
because of advantage of technologies, disappearance of national boundaries and
market along with varied expectations of customers. Customer, competition and
change (3C) are the three forces, which individually as well as in combination, is
driving todays companies in unfamiliar troubles. No organization can afford to
overlook any one of them. Onslaught of 3 C can be combated with 3I
(Information, Integration and involvement of stake holder).In order to retain the
competitive edge the companies should change their traditional way of doing
business. Benefit of IT driven business transformation initiatives can be very
tangible .Many organization have initiated project on IT driven business
transformation

BUILDING OF STRONG BRAND IMAGE

In todays business scenario brand image of any product or company plays most
vital role in the success of business it helps to identify the potential buyers and
investors and communicate the message across through the memorable lines of
advertisement like KAR LO DUNIA MUTHI ME(Reliance), WE ALSO MAKE
STEEL(TISCO).Company CSR practices sticking to core values ,customer focus,
Organizational behaviors makes a strong brand image. To enhance brand image at
national and international level a company need to advertise properly and sponsor
national and international mega events while venturing in to the global arena

NTPC AS CASE STUDY

National Thermal Power Corporation Ltd. (NTPC) a global giant in the power
sector was set up on 7th November 1975, with an objective to accelerate the
electricity generation by planning, promoting and organizing integrated
development of thermal power in India. NTPCs core business is engineering,
construction and operation of power generating plants. It also provides
consultancy in the area of power plant constructions and power generation to
companies in India and abroad. As on date the installed capacity of NTPC is
27,904 MW through its 15 coal based (22,895 MW), 7 gas based (3,955 MW) and
4 Joint Venture Projects (1,054 MW).

VISION: To be one of the worlds largest and best

power utilities, powering Indias growth.
To realize this vision, NTPC has drawn up a detailed Corporate Plan for the
period 1997-2012 which represents the company's collective optimism and
enthusiasm, inspired by a glorious past, a vibrant present and a brilliant future.

CORE VALUES This corporate plan provides details of the overall agenda for
NTPC. The successful delivery of this agenda would require a committed work
force that identifies with and supports the vision. To ensure realization of this
corporate agenda, a set of core values should be central to, and govern each
activity of the organization. Known as one of the MAHARATANS of the PSUS
NTPC has its following core values. They are known as (BCOMIT) as follows:B-Business Ethics
C-Customer Focus

O-Organizational & Professional pride

M-Mutual Respect and Trust
I- Innovation & Speed
T-Total quality for Excellence

SWOT Analysis of NTPC

Strengths of NTPC:1. Largest market share in domestic power generation and broad customer
portfolio across the country.
2. Excellent track record of performance in project implementation and plant
operation.
3. MAHARATNAs status
4. Highly skilled and experienced human resources, exposed to state of the art
technologies in power generation and project execution.
5. High brand equity among shareholders.
6. Strong balance sheet- ability to raise low cost debt.
7. Thrust on reducing social cost of capacity growth- strong execution of R&R
plans.
8. In house training facility (PMI, CENPEEP, EDCs etc. ) that assist in
development of sector.

Weakness of NTPC:1. Low risk diversification of business portfolio consists primarily of generation
assets.
2. Poor financial health of customers.
3. Functional orientation hampering cross functional perspective in decision
making.
4. Long and multilayered procurement process leading to long lead times and
process delay.
5. Fragmented IT architecture.

6. Gaps in HR systems such as performance management, rewards and

incentives and career development.
7. Inadequate deployment of a strong knowledge management system that
could assist in improving efficiency and effectiveness in all aspects of the
business.
8. Hierarchy for decision making that affects responsiveness.
9. Role ambiguity and dilution within different lends of the organization.

Opportunities in front of NTPC:1. Expand generation capacities by putting up thermal and hydro capacities,
maintaing the position of a dominant generating utility in the Indian Power
sector.
2. Broad base fuel mix by considering imported coal, gas, domestic coal,
nuclear power etc with a view to mitigate fuel risks and maintain long run
competitiveness.
3. Expand services for EPC, R&M and O&M activities in the domestic as well as
international markets.
4. Lead the development and commercial deployment of non-conventional
energy sources especially in the distributed generation mode.
5. Backward integrate into fuel management to exercise greater control and
understanding of supply economics.
6. Improve collections by trading, direct sale to bulk customers and the active
role in allocation in new plants.
7. Forward integrate into the distribution business in India.

Threats to NTPC:1. Limited experience of operating in a truly liberalized environment with

competition.
2. Downward regulatory and competitive pressure on tariffs.
3. Stringent environmental norms in the future may add to the cost of
generation.
4. Absence of an independent regular for coal industry and the delay in private
investments lending to the risk of low availability of coal in the future .

NTPC AS AN ORGANIZATION
CORE COMPETENCIES
NTPC have established flagship in area of engineering, procurement, and
construction, Operation and maintenance ,Turn out capacity of SEBs and R&M. So
our obvious choice for entering in to global market is above core competency area.
Moreover, gradually we need to explore the possilities to venture in to new business
areas which will make us an integrated power company of the world.
FOLLOWING INITIATIVES HAS BEEN TAKEN UP FOR DIVERSIFICATION OF BUSINESS
1. JOINT VENTURE WITH BHEL FOR EQUIPMENT MFG.
2. JV WITH BHARAT FORGE
3. JV WITH ALSTOM FOR EPC
4. JV WITH RELIANCE AS UPL
5. JV WITH COAL INDIA FOR FOREIGN COAL MINES
6. JV WITH SEBS FOR LAND AND WATER

Technological Initiatives
Introduction of steam generators (boilers) of the size of 800 MW
Integrated Gasification Combined Cycle (IGCC) Technology
Launch of Energy Technology Center -A new initiative for development of technologies with
focus on fundamental R&D
The company sets aside upto 0.5% of the profits for R&D
Roadmap developed for adopting Clean Development
TQM

NTPC TQM MODEL

BE MODEL

STRATEGIC

BSC
ROAD MAP

OPERATIONAL

PIPs-Six Sigma,
BM, RCA, PST
ISO
TPM
QC, PC

PEOPLE INVOLVEMENT

Suggestions
5S

In NTPC we need to reduce our inventory to a minimum possibility level without

doing compromise with our plant availability and efficiency.
Integration is one process to reduce the inventory level. We have implemented ERP,
Further to reduce maintenance cost we have to make maintenance database at
different project.
NTPC has taken several benchmarking project to adopt best practices.NTPC is
aiming at business excellence by implementing productivity mode l, launching sixsigma projects and adopting RC maintenance.
ENVIRONMENT ,SAFETY AND CSR
Right from its inception, the company had a well defined environment policy. More
than just generating power, it is committed to sustainable growth of power. NTPC
has evolved sound environment practices.
In order to ensure that NTPC complies with all the stipulated environment norms,
following state-of-the-art pollution control systems / devices have been installed to
control air and water pollution:

All stations of NTPC are ISO 14001 certified

Various groups to care of environmental issues

The Environment Management Group

Ash Utilisation Division

Afforestation Group

Centre for Power Efficiency & Environment Protection

Group on Clean Development Mechanism

NTPC is the second largest owner of trees in the country after the
Forest department
Project DISHA
The NTPC has recently come out with a road map for organisational
transformation under the name "Project Disha". What are its salient features?
Project Disha is a comprehensive organisation transformation project with a
view to positioning the NTPC as a globally comparable utility, aligned with
global best practices in various areas of its processes and functions. The
project is focussed on important areas, such as core business strategy,
portfolio diversification, globalisation, services business model, IT strategy,
structural initiatives, planning process, unit level processes (maintenance,
procurement and inventory), engineering initiatives, project planning and
execution, performance management system, rewards and incentives, career
development system and knowledge management system. As part of Disha,
we are implementing an enterprise resource-planning (ERP) project called
Lakshya. The ERP initiative is likely to impart a cutting edge to the company
in terms of increased efficiency, quicker response to stakeholders' demands,
flexibility and transparency.

BUILDING CORE COMPETENCY

Increase in investment in R&D from 0.5% to 2% with international exposure.

Reverse engineering needs to be done for better understanding of
technologies

Developing experts in key areas by providing suitable career path

Improvising O&M practices to increase avability and PLF by employing

modern maintenance techniques like risk evaluation and prioritization (REAP),
TPM, SMED and strategic alliance with institutional like EPRI.

Vender development through vendor incentive scheme and vendor

partnership and source standardization for materials and services.
Standardization the plant layout and units size will lead to lower vendor base

Backward integration to be expedited to fill the gap in fuel availability as

integral fuel security measure and to reduce cost of power

Forward integration to be expedited to take advantage of electricity act 2003

Adoption of latest software tools like PADO for process optimization

Adoption
technology

of

super

critical

technology

IGCC

,Distributed

generation

DEVELOPING WORLD CLASS HR PRACTICES

Based on the growth in global market planning two separate career tracks
one for domestic market and one for international market with distinct
recruitment, job rotation and compensation policies with specific objective of
grooming globally mobile executives.

Career development shall be the responsibility of the individual , vacancies

may be advertised internally and employees can apply confidentially without
permission of line manger and selection should be based on competency. Delayering should be introduced by creation of 4-5 different role bands across
the company depending on similarity and interchangeability of roles.
Competency of each role to be defined and training to be imparted to meet
the competency gap

Newly introduce PMS in having excellent features. It should be implemented

smoothly

Variable pay based on performance has been introduced

Open and transparent communication should be practiced through top down

communication, employee feedback and employee participative system

Enable a positive orientation toward, knowledge shearing , innovation,

creativity, change management, collective efforts, cross functional activities
and participative leadership

Culture assessment tools ,Process and culture monitoring index have to be

developed to measure culture and values from time to time through survey

For better knowledge management, ERP should be implemented at the

earliest. For the time being , intranet and high speed internet should be made
available across the company

The skills of strategic decision making, vision, communication and innovation

are to be developed among LEADERS. lateral hiring at senior level is obvious
solution to operate in international market

Introducing call center and voice response system concept for increasing
customer satisfaction.

IT AND COMMUNICATION INFRASTUTUE DEVELOPMENT

Latest state of the art communication system to support

conferencing ,teleconferencing, voice over IP is to be implemented

To facilitate process integration BPR, enterprise resource planning system to

be implemented. The ERP solution to be customized to suit NTPC operation
and future requirement

E-commerce to be implemented

Awareness of contract laws of different countries

video

ENVIRONMENT AND SAFETY MANAGEMENT

Reducing green house gas emission by adopting advanced clean coal

technology

Ash disposal and utilization can be improved by providing initial facilities like
land and machinery to customers

Investments on safety equipments emergency communication system and

alarm are to be increased to bring it at par with global standards

TQM for global competiveness

TQM Initiatives like ISO,OHSAS, Work place management and bench marking
to be implemented in letter and spirit

Market place uncertainties

We may focus on Asia pacific and adopt an opportunistic approach to middle

east and Africa for globalization thrust

We may enter in to the global market for offering engineering and operation
related services .We may bid for more overseas assignment in O&M and
projects construction

Market entry strategy should involve strategic alliance/JV in Asia pacific and
subsidiary/sub contractor route for middle east and Africa

We may aim to accreditation body for ISO and spearhead the whole gamut of
inspection of Indian exports.