Public-sector defence undertaking, Bharat Electronics (BEL), which is eyeing contracts from the offset clause, is giving its HR policies a makeover. The move is aimed at attracting talents from engineering disciplines. The company, facing severe competition from the private sector to attract and retain talent, has adopted HR practices followed by these companies.
The Navaratna company has forged alliances with several management institutes across the country such as Management Development Institute (MDI), Gurgaon, International Management Institute (IMI), Delhi and HR consultancy firm, TVR Learning Systems, Ahmedabad, to train its mid-level and senior executives in management principles.
This, according to company HR Director M L Shanmukh, will help the company prepare itself to meet the demands of global firms that will invest in India as part of their offset clause commitments. The defence offset policy currently mandates that any contract worth more than Rs 300 crore ($73 million) will place on the vendor a “direct offset liability” of 30 per cent, making him liable for sourcing defence goods or services worth at least 30 per cent of the contract value from India. The new rulebook called the defence procurement policy or DPP-2008, will govern the purchase of military equipment worth an estimated Rs 300,000 crore ($75 billion) over the next five years.
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BEL has also engaged global consultancy firm Ernst & Young to prepare an organisational competency model along with behavioural indicators for it and initiate competency mapping for 40 unique roles and functional models for finance, marketing, HR, quality management, strategy planning, business contracts, technology planning and corporate communication. BEL, which is targetting to more than double its revenue to Rs 10,000 crore by 2010, has signed MoUs with aerospace majors Lockheed Martin and Boeing, global defence companies such as EADS and Northrop Grumman to exploit opportunities arising out of offsets and is currently working out the details of the joint ventures with them.
Shanmukh said, “We need to analyse our business strategy focussing on key driving forces of business such as technology, distribution, competition and the markets. The ultimate aim is to encourage our employees to contribute to the bottomline of the company.”
Presently, BEL has deputed 100 key engineers to undergo project management training at the Bangalore centre of Project Management Institute (PMI), an American institution offering certifications. “Our aim is to keep our engineers ready to take up the jobs emerging out of the offset business. The PMI training will help them execute orders effectively in a timebound manner.” The company is spending around Rs 33,000 per engineer to undergo PMI training.
BEL has recently launched a programme to harness young talent by conducting a six months’ residential marketing programme for junior executives at the International Management Institute, Delhi. The company had organised a workshop for deputy managers and managers. “The intention of the training is to get the junior and mid-level executives involved in evolving the future strategy of the company,” Shanmukh said.
The firm has also introduced performance management system (PMS) for all senior executives upto DGM level across the company. The company has taken the help of HR consultancy firm, TVRLS. PMS enables clarifying roles, fixing responsibilities, aligning the individual’s performance with organisational activities and building a value-based performance culture in the organisation, he said.
BEL is also planning to recruit an additional 400 engineers during the current year. Last year, it added 435 employees to take the total headcount to 12,371. Its manpower cost is 15.38 per cent of the annual turnover or Rs 633 crore during 2007-08.