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SCDL MBA PROJECT - A Study of potential appraisal at maruti udhyog limited

TABLE OF CONTENTS



1.     Preface
2.     Acknowledgement
3.     No Objection Certificate
4.     Declaration.
5.     Certificate Of Supervisor (Guide)
6.     Organizational Introduction
7.     Objectives
8.     Introduction to Potential Appraisal
9.    
13.                        Research Methodology
14.                        Survey Results
15.                     
27.                        Bibliography


PREFACE

Managing human resources in today’s dynamic environment is becoming more and more complex as well as important. Recognition of people as a valuable resource in the organization has led to increases trends in employee maintenance, job security, etc
My research project deals with “Potential Appraisal as carried out at MARUTI UDYOG LIMITED”. In this report, I have studied &evaluated the Potential appraisal process as it is carried out in the company.
The first section of my report deals with a detailed company profile. It includes the company’s history: its activities and operations, organizational structure, etc. this section attempts to give detailed information about the company and the nature of it’s functioning.
The second section deals with Potential appraisal. In this section, I have given a brief conceptual explanation to Potential appraisal. It contains the definition, process and significance of Potential appraisal.
In the third section of my report, I have conducted a research study to evaluate the process of Potential appraisal at MARUTI UDYOG LIMITED.; this section also contains my findings, conclusions, suggestions and feedback.
The fourth  and final section of this report consists of extra information that I related to the main contents of the report. These annexure include some graphs and diagrams relating to the company, graphs relating to the research study and important documents upon which the project is based.



ACKNOWLEDGEMENT


I would like to express our sincere gratitude towards my project guide Mr. Arjun Singh Bisht Sr Manager Operations Resonance Eduventure Pvt Ltd  for his invaluable guidance, immense patience and constant encouragement during the course of my project. He has more than 08 years of experience in different companies in India in Management Cadre. He is also a visiting faculty in Management Institutes and also helping in the development of the student.

I would also like to express my gratitude to Ms. Bhavana Kochar, Sr. Relationship Manager, HDFC bank ltd New Delhi who has guided me throughout the project. She has around 04 years of experience in investment sector with deferent companies. I thank them both for their keen interest and kind cooperation during the course of my project.

I feel privileged to acknowledge my sincere gratitude to my colleagues who contributed to a great extent in laying the foundation for the project and provided invaluable guidance during the course of the project.
                                                                                                           
Last but not the least, my special thanks to all respondents who have co-operated in sharing their valuable views and have given their time and co-operate me in my project.
The goal was fixed, moves were calculated and I moved with full of enthusiasm, vigor and keen interest. There was a time when it proved to be on up hill task, the goal seeming beyond my reach. But as work progressed my determination and will power grew stronger and completion of this work further confined my belief that, “WHERE THERE IS A WILL THERE IS A WAY”.

With All Regards,
Preeti Bansal




NO OBJECTION CERTIFICATE


This is to certify that Mr. Preeti Bansal is an employee of this organization for the past      ** years.

We have no objection for him/her to carry out a project work titled “Potential Appraisal At Maruti Udhyog Limited”  in our organization and for submitting the same to the Director, SCDL as a party of fulfillment of the of SCDL’s Two Year Programme i.e. Post Graduate Diploma in Business Administration (PGDBA) to Symbiosis, Centre for Distance Learning, Pune, India.

We wish him/her all the success.




Place:   New Delhi                                               (Signature of the competent authority
Date: 25/4/11                                                       of the Organization)
   


DECLARATION


This is to declare that I have carried out this project report “Potential Appraisal At Maruti Udhyog Limited”  myself and submitted in part fulfillment of the of SCDL’s Two Year Programme i.e. Post Graduate Diploma in Business Administration (PGDBA) to Symbiosis, Centre for Distance Learning, Pune, India.

The work is original, has not been copied from anywhere else and has not been submitted to any other University /Institute for an award of any degree/diploma.




Place:   New Delhi                                                                                    (PREETI BANSAL)
Date:                                                                                                        RegNo:


CERTIFICATE OF SUPERVISOR (GUIDE)

Certified that the work incorporated in this project report entitled as “Potential Appraisal At Maruti Udhyog Limited”submitted by Ms. Preeti Bansal in his original work and completed under my supervision. Material obtained from other sources has been acknowledged in the Project Report.


Date :                                                                                            Certified
Place : New Delhi                                       (Guide’s Name, Qualification & Address)
Dr. Arjun singh Bisht
PHd MBA (Finance )PGPM (IB)
54 E Pocket -1 Mayur Vihar Phase -1
Delhi ss 110091










Organization Introduction

Year of Establishment February 1981

Vision
"The Leader in the Indian Automobile Industry, Creating Customer Delight and Shareholder's Wealth; A pride of India."

Industry Automotive - Four Wheelers
Listings & its codes BSE - Code: 532500
NSE - Code: MARUTI
Bloomberg: MUL@IN
Reuters: MRTI.BO
Joint Venture with Suzuki Motor Company, now Suzuki Motor Corporation, of Japan in October 1982.

Registered & Corporate Office

11th Floor, Jeevan Prakash
25, Kasturba Gandhi Marg
New Delhi - 110001, India
Tel.: +(91)-(11)-23316831 (10 lines)
Fax: +(91)-(11)-23318754, 23713575
Telex: 031-65029 MUL IN
Works Palam Gurgaon Road
Gurgaon -122015
Haryana, India
Tel.: +(91)-(124)-2340341-5, 2341341-5
Website http://www.marutisuzuki.com/


Maruti Suzuki has two state-of-the-art manufacturing facilities in India. The first facility is at Gurgaon spread over 300 acres and the other facility is at Manesar, spread over 600 acres in North India.

The Gurgaon facility  
Maruti Suzuki's facility in Gurgoan houses three fully integrated plants. While the three plants have a total installed capacity of 350,000 cars per year, several productivity improvements or shop floor Kaizens over the years have enabled the company to manufacture nearly 700,000 cars/ annum at the Gurgaon facilities.

The entire facility is equipped with more than 150 robots, out of which 71 have been developed in-house. More than 50 per cent of our shop floor employees have been trained in Japan.

Gurgaon facility also houses `K' Engine plant.
The `K' family engine plant has an installed annual capacity of 240,000 engines and was commissioned in 2008.

Spread over an area of 20,300 m2, the `K' family engine facility is part of the Rs 9,000 crore investment plan drawn by Maruti Suzuki and Suzuki Motor Corporation.

The next generation `K'engine like all Maruti Suzuki earlier technologies is highly fuel efficient, while offering the best in refinement and Potential.

It will take the engine technology to the next level in India. A-Star is the first car to be powered by `K' family engine. The forthcoming models will be powered by other `K' family engines.

The in-line plant layout consisting of Casting, Machining and Assembly processes has high level of automation, effective material handling and inventory reduction techniques in place, aimed for high operational efficiency.

The facility employs global manufacturing best practices like cold testing, 100% on line automated checks to ensure global quality.    

The Manesar facility
Our Manesar facility has been made to suit Suzuki Motor Corporation (SMC) and Maruti Suzuki India Limited's (MSIL) global ambitions.

The plant was inaugurated in February 2007.

At present the plant rolls out World Strategic Models Swift, A-star & SX4 and DZire. The plant has several in-built systems and mechanisms.

There is a high degree of automation and robotic control in the press shop, weld shop and paint shop to carry on manufacturing work with acute precision and high quality.

The plant is designed to be flexible: diverse car models can be made here conveniently owing to automatic tool changers, centralized weld control system and numerical control machines that ensure high quality.    

The plant at Manesar is the company's fourth car assembly plant and started with an initial capacity of 100,000 cars per year. This will be scaled up to 300,000 cars per year by October 2008.

Diesel Engine Plant- Suzuki Powertrain India Limited      

Suzuki Powertrain India Limited the diesel engine plant at Manesar is SMC's & Maruti's first and perhaps the only plant designed to produce world class diesel engine and transmissions for cars.

The plant is under a joint venture company, called Suzuki Powertrain India Limited (SPIL) in which SMC holds 70 per cent equity the rest is held by MSIL.

This facility has an initial capacity to manufacture 100,000 diesel engines a year. This will be scaled up to 300,000 engines/annum by 2010.


OBJECTIVES

The research is about studying the Employee’s potential level in MARUTI UDYOG LIMITED at Head Office. The objective of this project is to find out the capabilities and skills of the employee’s and request the management to provide necessary training required for the present job or for the higher position or responsibility and predicting his or her future Potential which aid the organization in fitting the right person in the right job and in improving company’s Potential.

Potential appraisal is an important part of the appraisal process. Appraising employee’s potential helps to evaluate his/her capability for growth and development to greater challenges, responsibilities and positions in the organizational hierarchy. Most organization incorporate potential appraisal in their appraisal processes for identifying and developing suitable employee base for succession planning.

This appraisal concentrates on the future, based on the Potential of the past and helps in developing the personal interests of the employees in alignment to the organizational goals.

An interview was made and the evaluation of the employee’s potential level collected in a questionnaire through superior appraisal process. This study would help the management to assess the capabilities of the employees accordingly they can provide training and take necessary measures to improve their capabilities and skills to fulfill the present and future requirements and various statistical tools used over the data collected to ascertain the employee’s potential.



INTRODUCTION

Potential appraisal is another powerful tool of employee development. Whether managers realize it or not, they are accustomed to make potential assessments. Every time a manager recommends or fails to recommend an employee for a promotion, a potential assessment has, in fact, been made. The process of assessing the managerial potential of employees deals with the question of whether or not they have the ability to handle positions in the future which involve considerably more responsibility than what they have right now. As long as individuals are viewed as being able to handle increased or different responsibilities, they would be considered to have potential (either latent or visible).

Potential appraisal may thus be defined as a process of determining an employee’s strengths and weaknesses with a view to use this as a predictor of his future Potential. This would help determine the promotabilty of an individual to a higher position and help chalk out his career plan. The fundamental difference between reviewing Potential and assessing potential is in the criteria used. In reviewing Potential, the criterion used is what goals the employee achieved and what skills he or she currently possesses that could be indicators of his or her ability to assume different or more advanced responsibilities. It is this that makes potential appraisal a very crucial & critical area.

If an employee without requisite abilities is promoted to a higher position and does not perform as per expectations, then it becomes impossible to demote him. Thus, he is unable to perform at the higher level and becomes a ‘passenger’ in the system. It is rightfully assumed that every individual has potential, low or high. Many organizations have people whose potential being low; Potential too is not up to the mark. Whilst the question in our minds hovers around how such people got into the system, the fact remains that they do not contribute to the organization’s Potential. If appraisal process implemented well, professional Potential and potential appraisal could take the organization on a fast development track and faster productivity through people.
The potential appraisal refers to the appraisal i.e. identification of the hidden talents and skills of a person. The person might or might not be aware of them. Potential appraisal is a future –oriented appraisal whose main objective is to identify and evaluate the potential of the employees to assume higher positions and responsibilities in the organizational hierarchy. Many organizations consider and use potential appraisal as a part of the Potential appraisal processes.


Potential appraisal is one of the most important requirement for successful business and human resource policy (Kessler 2003). Rewarding and promoting effective Potential in organization, as well as identifying ineffective performers for developmental programs or other personnel actions are essential to effective human resource management (Pulakos 2003).

Project on potential appraisal was done by many, and the research process carried out to find out the employee’s potential. Sajitha Nair had done a project on potential appraisal for succession planning in the year 2005. She looked at the competencies required by the person who will fit in the job role. Then looked at the competencies possessed by the person and did a gap analysis. She found that everyone excels in all key actions, full mastery of all competencies.

page 14-34  are hidden




, the excellent chief engineer is promoted to become a very poor engineering director, and the star football player struggles to be a football manager.
Potential can be defined as ‘a latent but unrealized ability’. There are many people who have the desire and potential to advance through the job they are in, wanting the opportunity to operate at a higher level of competence in the same type of work. The potential is the one that the appraiser should be able to identity and develop because of the knowledge of the job. This requires an in-depth study of the positions which may become vacant, looking carefully at the specific skills that the new position may demand and also taking into consideration the more subjective areas like ‘qualities’ required. These may be areas where the employee has not had a real opportunity to demonstrate the potential ability and there may be areas with which you, as the appraisers are not familiar. There are few indicators of potential (Box 1) which may be considered.

Indicators of Potential
A sense of reality: This is the extent to which a person thinks and acts objectively, resisting purely emotional pressures but pursuing realistic projects with enthusiasm.

Imagination: The ability to let the mind range over a wide variety of possible causes of action, going beyond conventional approaches to situations and not being confined to ‘This is the way it is always being done!’

Power of analysis: The capacity to break down, reformulate or transform a complicated situation into manageable terms.

Breadth of vision: The ability to examine a problem in the context of a much broader framework of reference; being able to detect, within a specific situation, relationships with those aspects which could be affecting the situation.

Persuasiveness: The ability to sell ideas to other people and gain a continuing commitment, particularly when the individual is using personal influence rather than ‘management authority’.

Source: Adopted from Philip, Tom (1983). Making Performance Appraisal Work,
McGraw Hill Ltd., U.K.

Like the Performance Appraisal, potential appraisal is also done by the employees’ supervisor who has had the opportunity to observe the employee for some time. Potential appraisal may be done either regularly or as and when required. Generally last part of appraisal deals with potential appraisal, as this is seen in case of Maruti Udyog Ltd.


POTENTIAL APPRAISAL CAN SERVE THE FOLLOWING PURPOSES:

• To advise employees about their overall career development and future prospects
• Help the organization to chalk out succession plans
• Motivate the employees to further develop their skills and competencies.
• To identify the training needs.


TEHNIQUES OF POTENTIAL APPRAISAL

  • Self – appraisals
  • Peer appraisals
  • Superior appraisals
  •  MBO
  • Psychological and psychometric tests
  • Management games like role playing
  • Leadership exercises etc.

With the help of the potential appraisal form, the employees/ individuals are judged on various Potential and behavioral parameters like:
·         The Potential areas in which the improvement or development is indicated.
·         The accomplishments and the targets achieved in the current appraisal period
·         Overall rating of the Potential
·         What skills, knowledge, competencies and qualities should be developed?
·         Has the employee taken any steps for improving his Potential and his
·         Career development?
·         Recommendations for the training and development of the employee
·         Updating knowledge on the latest developments on their job related and subject areas.
·         Rate the employee on the following characteristics or how does the employee fair on following behavioral characteristics:
o   Decision making
o   Independent
o   Confidence towards the job
o    Handling stress and pressure
o    Inter-personal skills, both with superiors and subordinates
o    Leadership, motivating and conflict handling

The past Potential of the employee and the potential of performing in future helps to identify the hidden talents.



SELF APPRAISAL FORM


Self appraisal is the self evaluation where the employee himself gives the feedback or his views and points regarding his Potential. The employee himself critically analyses the Potential, his strengths, weaknesses, accomplishments, problems faced, the training and development needs (if any) etc. The self appraisal form generally starts with the employee details like:

• The name of the employee
• Designation
• Date of joining
• Date of last appraisal
• Department
• Reporting officer


The next section is, commonly, designed to gather the information from the employee regarding his on-the-job Potential and his responsibilities:

• The current responsibilities held by the employee
• Accomplishments
• Goals for the next appraisal period
• Areas for improvement
• Training requirements felt for the present job
• Responsibilities the employee would like to add to his current responsibilities
• Problems faced
• Solutions tried
• Measures taken for personal and professional development
• Best and worst aspects of the job
• Is the superior supportive

The form also includes a section where the employee rates himself on various behavioral parameters like:

• Communication skills
• Inter-personal skills
• Problem-solving
• Team work
• Adaptability/Flexibility
• Initiative
• Decision Making
• Leadership
• Maturity

The self appraisal form also includes a section where the employee can quote examples and incidents to support his ratings and answers.

The self appraisal form generally ends with a subjective section asking for suggestions and the choice of discussing any other topic that the employee feels the need to raise and discuss.

MARUTI UDYOG chooses Self Appraisal as a primary method to judge an Employee’s potential.


APPRAISAL PROCESS

Potential appraisal is an important part of the appraisal process. Appraising an employee’s potential helps to evaluate his/her capability for growth and development to greater challenges, responsibilities and positions in the organizational hierarchy.

MARUTI UDYOG incorporates potential appraisal in their appraisal processes for identifying and developing suitable employee base for succession planning.

This appraisal concentrates on the future, based on the Potential of the past and helps in developing the personal interests of the employees in alignment to the organizational goals.

Potential appraisal is another powerful tool of employee development. The fundamental difference between reviewing Potential and assessing potential is in the criteria used. In reviewing Potential, the criterion used is what goals the employee achieved and what skills he or she currently possesses that could be indicators of his or her ability to assume different or more advanced responsibilities. It is this that makes potential appraisal a very crucial & critical area. If an employee without requisite abilities is promoted to a higher position and does not perform as per expectations, then it becomes impossible to demote him.

Thus, he is unable to perform at the higher level and becomes a ‘passenger’ in the system. It is rightfully assumed that every individual has potential, low or high. MARUTI UDYOG (like other organizations) has people whose potential being low; Potential too is not up to the mark. Whilst the question in our minds hovers around how such people got into the system, the fact remains that they do not contribute to the organization’s Potential.




GAUGING EMPLOYEES POTENTIAL FOR MANAGEMENT POSITION

The aim of potential assessment is to identify training and development needs, provide guidance on possible directions in which an individual's career might go, and indicate who has potential for promotion.

A more comprehensive approach is provided by the use of assessment centers. These incorporate a range of assessment techniques and typically have the following features:

• The focus of the centre is on behavior.
• Exercises are used to capture and simulate the key dimensions of the job. These include one to one role plays and group exercises. It is assumed that Potential in these simulations predicts behavior on the job.
• Interviews and tests will be used in addition to group exercises.
• Potential is measured in several dimensions in terms of the competencies required to achieve the target level of Potential in a particular job or at a particular level in the organization.
• Several candidates or participants are assessed together to allow interaction and to make the experience more open and participative.
• Several assessors or observers are used in order to increase the objectivity of assessments. Involving senior managers is desirable to ensure that they 'own' the process. Assessors must be carefully trained.

Assessment centers provide good opportunities for indicating the extent to which candidates match the culture of the organization. This will be established by observation of their behavior in different but typical situations, and by the range of the tests and structured interviews that are part of the proceedings. Assessment centers also give candidates a better feel for the organization and its values so that they can decide for themselves whether or not they are likely to fit.



ASSESMENT CENTERS

Employees are not contended by just having a job. They want growth and individual development in the organization. An “assessment centre” is a multiple assessment of several individuals performed simultaneously by a group of trained evaluators using a variety of group and individual exercises.

Assessment centers are a more elaborate set of performance simulation tests, specifically designed to evaluate a candidate’s managerial potential. Line executives, supervisors, and/or trained psychologists evaluate candidates as they go through one to several days of exercises that simulate real problems that they would confront on the job. Based on a list of descriptive dimensions that the actual job incumbent has to meet, activities might include interviews, in-basket problem-solving exercises, leaderless group discussions, and business decision games. For instance, a candidate might be required to play the role of a manager who must decide how to respond to ten memos in his/her in-basket within a two-hour period. Assessment centers have consistently demonstrated results that predict later job performance in managerial positions.

The American Telephone and Telegraph Company (AT&T) began experiments with Assessment Centre approach in the 1950’s as a part of a wide programme of management development. The AT&T Company designated a particular building where the Assessments were carried out. This building became known as Assessment centre and the name has stuck as a way of referring to the method. The method became established in the industry in the USA during the 1960’s and 1970’s and was introduced in UK during this period.

This method is now regarded as one of the most accurate and valid assessment procedures and is widely used for selection and development. According to IPMA (The International Personnel Management Association), an assessment center consists of a standardized evaluation of behavior based on multiple inputs. They are used to assess the strengths, weaknesses and potential of employees. The specific objective is to reinforce strengths, overcome weaknesses and exploit potential of the employees through training and developmental efforts. Several trained observers and techniques are used. Judgments about behavior are made, in major part, from specifically developed assessment simulations. These judgments are pooled in a meeting among the assessors or by a statistical integration process. In an integration discussion, comprehensive accounts of behavior, and often ratings of it, are pooled.

The discussion results in evaluations of the performance of the assesses on the dimensions/ competencies or other variables that the assessment center is designed to measure. There is a difference between an assessment center and assessment center methodology. Various features of the assessment center methodology are used in procedures that do not meet all of the guidelines set forth here, such as when a psychologist or human resource professional, acting alone, uses a simulation as a part of the evaluation of an individual. Such personnel assessment procedures are not covered by these guidelines; each should be judged on its own merits. Procedures that do not conform to all the guidelines here should not be represented as assessment centers or imply that they are assessment centers by using the term “assessment center” as part of the title.



The following are the essential elements for a process to be considered an assessment center:

a) Job Analysis
A job analysis of relevant behaviors must be conducted to determine the dimensions, competencies, attributes, and job performance indices important to job success in order to identify what should be evaluated by the assessment center. The type and extent of the job analysis depend on the purpose of assessment, the complexity of the job, the adequacy and appropriateness of prior information about the job, and the similarity of the new job to jobs that have been studied previously. If past job analyses and research are used to select dimensions and exercises for a new job, evidence of the comparability or generalizability of the jobs must be provided. If job does not currently exist, analyses can be done of actual or projected tasks or roles that will comprise the new job, position, job level, or job family. Target dimensions can also be identified from an analysis of the vision, values, strategies, or key objectives of the organization. Competency-modeling procedures may be used to determine the dimensions/competencies to be assessed by the assessment center, if such procedures are conducted with the same rigor as traditional job analysis methods. Rigor in this regard is defined as the involvement of subject matter experts who are knowledgeable about job requirements, the collection and quantitative evaluation of essential job elements, and the production of evidence of reliable results. Any job analysis or competency modeling must result in clearly specified categories of behavior that can be observed in assessment procedures.

A “competency” may or may not be amenable to behavioral assessment as defined herein. A competency, as used in various contemporary sources, refers to an organizational strength, an organizational goal, a valued objective, a construct, or a grouping of related behaviors or attributes. A competency may be considered a behavioral dimension for the purposes of assessment in an assessment center if

i) it can be defined precisely
ii) expressed in terms of behaviors observable on the job or in a job family and in
simulation exercises.
iii) a competency also must be shown to be related to success in the target job or
position or job family.

b) Behavioural Classification
Assessment centre requires that Behaviors displayed by participants must be classified into meaningful and relevant categories such as dimensions, attributes, characteristics, aptitudes, qualities, skills, abilities, competencies, and knowledge.

c) Assessment Techniques
The techniques used in the assessment center must be designed to provide information for evaluating the dimensions previously determined by the job analysis. Assessment center developers should establish a link from behaviors to competencies to exercises/ assessment techniques. This linkage should be documented in a competency-by exercise/ assessment technique matrix.

d) Multiple Assessments
Multiple assessment techniques must be used. These can include tests, interviews, questionnaires, sociometric devices, and simulations. The assessment techniques are developed or chosen to elicit a variety of behaviors and information relevant to the selected competencies/ dimensions. Self-assessment and 360 degree assessment data may be gathered as assessment information. The assessment techniques will be pretested to ensure that the techniques provide reliable, objective and relevant behavioral information. Pre-testing might entail trial administration with participants similar to assessment center candidates, thorough review by subject matter experts as to the accuracy and representativeness of behavioral sampling and/or evidence from the use of these techniques for similar jobs in similar organizations.

e) Simulations
The assessment techniques must include a sufficient number of job related simulations to allow opportunities to observe the candidate’s behavior related to each competency/ dimension being assessed. At least one—and usually several—job related simulations must be included in each assessment center. A simulation is an exercise or technique designed to elicit behaviors related to dimensions of performance on the job requiring the participants to respond behaviorally to situational stimuli. Examples of simulations include, but are not limited to, group exercises, in-basket exercises, interaction (interview) simulations, presentations, and fact-finding exercises. Stimuli may also be presented through video based or virtual simulations delivered via computer, video, the Internet, or an intranet. Assessment center designers also should be careful to design exercises that reliably elicit a large number of competency- related behaviors. In turn, this should provide assessors with sufficient opportunities to observe competency-related behavior.

f) Assessors
Multiple assessors must be used to observe and evaluate each assessee. When
selecting a group of assessors, consider characteristics such as diversity of age, sex, organizational level, and functional work area. Computer technology may be used to assess in those situations in which it can be shown that a computer program evaluates behaviors at least as well as a human assessor. The ratio of assessees to assessors is a function of several variables, including the type of exercises used, the dimensions to be evaluated, the roles of the assessors, the type of integration carried out, the amount of assessor training, the experience of the assessors, and the purpose of the assessment center. A typical ratio of assessees to assessors is two to one. A participant’s current supervisor should not be involved in the assessment of a direct subordinate when the resulting data will be used for selection or promotional purposes.


g) Assessor Training
Assessors must receive thorough training and demonstrate performance that meets requirements prior to participating in an assessment center. The training should focus on processing of information, drawing conclusions, interview techniques and understanding behaviour.

h) Recording Behaviour
A systematic procedure must be used by assessors to record specific behavioral observations accurately at the time of observation. This procedure might include techniques such as handwritten notes, behavioral observation scales, or behavioral checklists. Audio and video recordings of behavior may be made and analyzed at a later date.

i) Reports
Assessors must prepare a report of the observations made during each exercise before the integration discussion. It is suggested that assessors must prepare the report immediately after the assessment is over otherwise they are likely to forget the details. Not only this, these reports must be independently made.

j) Data Integration
The integration of behaviors must be based on a pooling of information from assessors or through a statistical integration process validated in accordance with professionally accepted standards. During the integration discussion of each
dimension, assessors should report information derived from the assessment techniques but should not report information irrelevant to the purpose of the assessment process. The integration of information may be accomplished by consensus or by some other method of arriving at a joint decision. Methods of combining assessors’ evaluations of information must be supported by the reliability of the assessors’ discussions. Computer technology may also be used to support the data integration process provided the conditions of this section are met.

Uses of Assessment Centres
Data generated during the process of Assessment can become extremely useful in identifying employee potential for growth. This data can be used for:

a) Recruitment and Promotion: Where particular positions which need to be filled exist, both internal and external can be assessed for suitability to those specific posts.

b) Early Identification of Personnel: The underlying rationale here is the need for the organization to optimise talent as soon as possible. High potential people also need to be motivated so that they remain with the organization.

c) Diagnosis of Training and Development Needs: It offers a chance to establish individual training and development needs while providing candidates with a greater appreciation of their needs.

d) Organizational Planning: Assessment centers can be used to identify area where widespread skill deficiencies exist within organizations, so that training can be developed in these areas. Results can also be integrated with human resource planning data to provide additional information concerning number of people with particular skills needed to meet future needs.




Assessment Centres and Development Centres

Traditionally an assessment centre consisted of a suite of exercises designed to assess a set of personal characteristics. It was seen as a rather formal process where the individuals being assessed had the results fed back to them in the context of a simple yes/no selection decision. However, recently we have seen a definite shift in thinking away from this traditional view of an assessment centre to one which stresses the developmental aspect of assessment. A consequence of this is that today it is very rare to come across an assessment centre which does not have at least some developmental aspect to it. Increasingly assessment centres are stressing a collaborative approach which involves the individual actively participating in the process rather than being a passive recipient of it. In some cases we can even find assessment centres that are so developmental in their approach that most of the assessment work done is carried out by the participants themselves and the major function of the centre is to provide the participants with feedback that is as much developmental as judgmental in nature.

Assessment centres typically involve the participants completing a range of exercises which simulate the activities carried out in the target job. Various combinations of these exercises and sometimes other assessment methods like psychometric testing and interviews are used to assess particular competencies in individuals. The theory behind this is that if one wishes to predict future job performance then the best way of doing this is to get the individual to carry out a set of tasks which accurately sample those required in the job. The particular competencies used will depend upon the target job but one should also learn such competencies such as relating to people; resistance to stress; planning and organising; motivation; adaptability and flexibility; problem solving; leadership; communication; decision making and initiative. The fact that a set of exercises is used demonstrates one crucial characteristic of an assessment centre, namely; that it is behaviour that is being observed and measured. This represents a significant departure from many traditional selection approaches which rely on the observer or selector attempting to infer personal characteristics from behaviour based upon subjective judgment and usually precious little evidence. This approach is rendered unfair and inaccurate by the subjective whims and biases of the selector and in many cases produces a selection decision based on a freewheeling social interaction after which a decision was made as whether the individual’s ‘face fit’ with the organisation.

Differences between Assessment and Development Centres
The type of centre can vary between the traditional assessment centre used purely for selection to the more modern development centre which involves self-assessment and whose primary purpose is development. One might ask the question ‘Why group assessment and development centres together if they have different purposes?’ The answer to that question is threefold.

a) they both involve assessment and it is only the end use of the information obtained which is different i.e. one for selection and one for development.

b) it is impossible to draw a line between assessment and development centres because all centres, be they for assessment or development naturally lie somewhere on a continuum somewhere between the two extremes.

c) Most assessment centres involve at least some development and most development centres involve at least some assessment. This means that it is very rare to find a centre devoted to pure assessment or pure development. It is easier to think about assessment centres as being equally to do with selection and development because a degree of assessment goes on in both.

d) Development Centres grew out of a liberalization of thinking about assessment
centres. While assessment centres were once used purely for selection and have evolved to have a more developmental flavour, the language used to describe them has not. Another problem with using the assessment – development dichotomy is that at the very least it causes us to infer that little or no assessment goes in development centres. While one hears centres being called assessment or development centres assessment goes on in both and to that extent they are both assessment centres. The end result of this is that it is not possible to talk about assessment or development centres in any but the most general terms. A number of differences between assessment and development centres exist are presented below:

a) Assessment centres have a pass/fail criteria while Development centres do not have a pass/fail criteria

b) Assessment centres are geared towards filing a job vacancy while Development centres are geared towards developing the individual

c) Assessment Centres address an immediate organisational need while
Development Centres address a longer term need

d) Assessment Centres have fewer assessors and more participants while
Development Centres have a 1:1 ratio of assessor to participant

e) Assessment Centres involve line managers as assessors while Development
Centres do not have line managers as assessors

f) Assessment Centres have less emphasis placed on self-assessment while
Development Centres have a greater emphasis placed on self-assessment

g) Assessment Centres focus on what the candidate can do now while
Development Centres focus on potential

h) Assessment Centres are geared to meet the needs of the organisation while Development Centres are geared to meet needs of the individual as well as the organization.

i) Assessment Centres assign the role of judge to assessors while Development Centres assign the role of facilitator to assessors.

j) Assessment Centres place emphasis on selection with little or no developmental while Development Centres place emphasis on developmental feedback and follow up with little or no selection function.

k) Assessment Centres feedback and follow up while Development Centres give feedback immediately.

l) Assessment Centres give feedback at a later date while Development Centres involve the individual having control over the information obtained.

m) Assessment Centres have very little pre-centre briefing while Development
Centres have a substantial pre-centre briefing.

n) Assessment Centres tend to be used with external candidates while development Centres tend to be used with internal candidates.



Career Planning Process

It is obvious from the foregoing analysis that individuals differ a great deal in term of their career orientation .The career orientation is influenced by the preference for a particular career anchor, the life cycle stage, individual difference in values, goals, priorities, and aspiration. Organization also on the other hand differ in term of career path and opportunities that they can provide given the reality of their internal and external environments .The career system available in organizational depend on their growth potential, goals and priorities. The difference between what the employees look for in their career progression and what career growth opportunities the  organizationis able to provide, gives rise to situation of potential conflict. If the conflict is allowed to persist, the employee will experience dissatisfaction and withdraw from being actively engaged in the productive pursuit .They might even choose the option of leaving the organization. In either case, the organization is not able to optimally utilize the potential contribution of its employee towards the achievement of its goal. The possibility of conflict between the individual-organization objective calls for career planning efforts which can help identify areas of conflict and initiate such action as necessary to resolve the conflict . Career planning thus involves matching of rewards and incentives offered by the career path and career structure with hope and aspiration of employees regarding their own concept of progression. A general approach to career planning would involve the following steps:

a) Analysis of the characteristic of the reward and incentives offered by the prevailing career system needs to be done and made know to employee .Many individuals may not be aware of their own career progression path as such information may be confined to only select group of managers.

b) Analyse the characteristic of the hopes and aspirations of different categories of employee including the identification of their career anchor must be done through the objective assignment. Most organization assume the career aspiration of individual employee which need not be in tune with the reality .The individual may not have a clear idea of their short and long term career and life goals , and may not be aware of the aspiration and career anchor .

c) Mechanism for identifying congruence between individual career aspiration and organizational career system must develop so as to enable the organization to discuss cases of mismatch or incongruence. On the basis of analysis, it will be necessary to compare and identify specific area of match and mismatch for different categories of employee.

d) Alternative strategies for dealing with mismatch will have to be formulated. Some of the strategies adopted by several organization include the following:

  • Change in the career system by creating new career path, new incentives, new rewards, by providing challenge through job redesign opportunities for lateral movement and the like.

  • Change in the employees hopes and aspirations by creating new needs, new goals, new aspiration or by helping the employees to scale down goal and aspiration that are unrealistic or unattainable for one reason or the other.

Succession Planning
Seek new basis of integration, compromise or other form of mutual change on the part of employee and organizational through problem solving, negotiation or other devices.

A framework of career planning process aimed at integrating individual and organizational needs is presented.

e) Reviewing Career Plans a periodic review of career plans is necessary to know whether the plans are contributing to the effective utilization of human resources by matching employee objectives to job needs. Review will also indicate to employee in which direction the organizations is moving, what changes are likely to take place and what skills are needed to adapt to the changing needs of the organization.


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Succession planning is an ongoing process that identifies necessary competencies, then works to assess, develop, and retain a talent pool of employees, in order to ensure a continuity of leadership for all critical positions. Succession planning is a specific strategy, which spells out the particular steps to be followed to achieve the mission, goals, and initiatives identified in workforce planning. It is a plan that managers can follow, implement, and customize to meet the needs of their organisation, division, and/or department.

The continued existence of an organization over time require a succession of persons to fill key position .The purpose of succession planning is to identify and develop people to replace current incumbents in key position for a variety of reasons. Some of these reasons are given below:

Superannuation: Employees retiring because they reach a certain age.
Resignation: Employees leaving their current job to join a new job
Promotion: Employees moving upward in the hierarchy of the organization.
Diversification: Employees being redeployed to new activities.
Creation of New Position: Employees getting placed in new positions at the
same level.

Succession can be from within or from outside the organization. Succession by people from within gives a shared feeling among employee that they can grow as the organization grows. Therefore organization needs to encourage the growth and development with its employee. They should look inward to identify potential and make effort to groom people to higher and varied responsibilities. In some professionally run large organizations, managers and supervisor in every department are usually asked to identify three or four best candidate to replace them in their jobs should the need arise. However, the organization may find it necessary to search for talent from outside in certain circumstance. For example, when qualified and competent people are not available internally, when it is planning to launch a major expansion or diversification programmes requiring new ideas etc.. Complete dependence on internal source may cause stagnation for the organization. Similarly complete dependence on outside talent may cause stagnation in the career prospects of the individual within the organization which may in turn generate a sense of frustration.

Succession planning provides managers and supervisors a step-by-step methodology to utilize after workforce planning initiatives have identified the critical required job needs in their organization. Succession planning is pro-active and future focused, and enables managers and supervisors to assess, evaluate, and develop a talent pool of individuals who are willing and able to fill positions when needed. It is a tool to meet the necessary staffing needs of an organization/department, taking not only quantity of available candidates into consideration, but also focusing on the quality of the candidates, through addressing competencies and skill gaps.


RATING
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 ERRORS IN POTENTIAL APPRAISAL

Potential appraisals are subject to a wide variety of inaccuracies and biases referred to as 'rating errors'. These errors can seriously affect assessment results. Some of the most common rating errors are: -
Leniency or severity: - Leniency or severity on the part of the rater makes the assessment subjective. Subjective assessment defeats the very purpose of Potential appraisal. Ratings are lenient for the following reasons:
a)    The rater may feel that anyone under his or her jurisdiction who is rated unfavorably will reflect poorly on his or her own worthiness.
b)    He/She may feel that a derogatory rating will be revealed to the rate to detriment the relations between the rater and the ratee.
c)     He/She may rate leniently in order to win promotions for the subordinates and therefore, indirectly increase his/her hold over him.
Central tendency: - This occurs when employees are incorrectly rated near the average or middle of the scale. The attitude of the rater is to play safe. This safe playing attitude stems from certain doubts and anxieties, which the raters have been assessing the rates.
Halo error: - A halo error takes place when one aspect of an individual's Potential influences the evaluation of the entire Potential of the individual. The halo error occurs when an employee who works late constantly might be rated high on productivity and quality of output as well ax on motivation. Similarly, an attractive or popular personality might be given a high overall rating. Rating employees separately on each of the Potential measures and encouraging raters to guard against the halo effect are the two ways to reduce the halo effect.
Rater effect: -This includes favoritism, stereotyping, and hostility. Extensively high or low score are given only to certain individuals or groups based on the rater's attitude towards them and not on actual outcomes or behaviors; sex, age, race and friendship biases are examples of this type of error.
Primacy and Regency effects: - The rater's rating is heavily influenced either by behavior exhibited by the ratee during his early stage of the review period (primacy) or by the outcomes, or behavior exhibited by the ratee near the end of the review period (regency). For example, if a salesperson captures an important contract/sale just before the completion of the appraisal, the timing of the incident may inflate his or her standing, even though the overall Potential of the sales person may not have been encouraging. One way of guarding against such an error is to ask the rater to consider the composite Potential of the rate and not to be influenced by one incident or an achievement.
Potential dimension order: - Two or more dimensions on a Potential instrument follow each other and both describe or rotate to a similar quality. The rater rates the first dimensions accurately and then rates the second dimension to the first because of the proximity. If the dimensions had been arranged in a significantly different order, the ratings might have been different.
Spillover effect: - This refers lo allowing past Potential appraisal rating lo unjustifiably influence current ratings. Past ratings, good or bad, result in similar rating for current period although the demonstrated behavior docs not deserve the rating, good or bad.


ROLES in POTENTIAL APPRAISAL PROCESS

a)  Reporting Manager
·         Provide feedback to the reviewer / HOD on the employees’ behavioral traits indicated in the PMS Policy Manual
·         Ensures that employee is aware of the normalization / Potential appraisal process
·         Address employee concerns / queries on Potential rating, in consultation with the reviewer
b)  Reviewer (Reporting Manager’s Reporting Manager)
·         Discuss with the reporting managers on the behavioral traits of all the employees for whom he / she is the reviewer
·         Where required, independently assess employees for the said behavioral traits; such assessments might require collecting data directly from other relevant employees
c)     HOD (In some cases, a reviewer may not be a HOD)
·         Presents the proposed Potential Rating for every employee of his / her function to the Normalization committee.
·         HOD also plays the role of a normalization committee member
·         Owns the Potential rating of every employee in the department
d)  HR Head
·         Secretary to the normalization committee
·         Assists HOD’s / Reporting Managers in communicating the Potential rating of all the employees
e)  Normalization Committee
·         Decides on the final bell curve for each function in the respective Business Unit / Circle
·          Reviews the Potential ratings proposed by the HOD’s, specifically on the upward / downward shift in ratings, to ensure an unbiased relative ranking of employees on overall Potential, and thus finalize the Potential rating of each employee



KEY CONCEPTS

In order to understand the Potential Management System at MARUTI UDYOG LIMITED, some concepts need to be explained which play a very important role in using the PMS successfully. They are:
o   KRA’S (KEY RESULT AREAS): The Potential of an employee is largely dependent on the KRA score achieved by the employee during that particular year. Thus, it is necessary to answer a few basic questions i.e.
o   What are the guidelines for setting the KRA’s for an employee?
o   How does an employee write down his KRA’s for a particular financial year?
o   KRA’s: The Four Perspectives.
o   How is the KRA score calculated for an employee on the basis of the targets sets and targets achieved? 
·         BEHAVIORAL TRAITS: Some of the qualitative aspects of an employees’ Potential combined with the general behavioral traits displayed by the employee during a year constitutes his behavior traits. An employee is assigned the rating on the basis of the intensity of the behavior displayed by him. They play a very important role in the deciding the final Potential rating for an employee as is even capable of shifting the rating one level upwards/downwards.
·         THE POTENTIAL RATING PROCESS: The rating process tries to explain the four different types of rating that an employee can achieve i.e. EP, SP, NP and PP. It also explains the criteria, which is considered for awarding any of these ratings to the employee.
·         PROMOTION AND RATING DISRTRIBUTION GUIDELINES: The promotion and normal distribution guidelines provide the framework within which the Potential appraisal process has to work. It is very important that the HR department pays due attention to these guidelines while preparing the bell curves for various functions and the consolidated bell curve for all the functions. These guidelines also help in deciding upon the promotion cases in a year.




ROLE OF HUMAN RESOURCE DEPT

Human Resource (or personnel) management, in the sense of getting things done through people, is an essential part of every manager’s responsibility, but many organizations find it advantageous to establish a specialist division to provide an expert service dedicated to ensuring that the human resource function is performed efficiently.
“People are our most valuable asset” is a cliché, which no member of any senior management team would disagree with. Yet, the reality for many organizations are that their people remain under valued, under trained and under utilized.
Following are the various functions of Human Resource Management that are essential for the effective functioning of the organization:
1.    Recruitment
2.    Selection
3.    Induction
4.    Potential Appraisal
5.    Training & Development



RESEARCH METHODOLOGY

RESEARCH DESIGN:
Research Design refers to "framework or plan for a study that guides the collection and analysis of data". A typical research design of a company basically tries to resolve the following issues:
a) Determining Data Collection Design
                b) Determining Data Methods
c) Determining Data Sources
d) Determining Primary Data Collection Methods
e) Developing Questionnaires
f) Determining Sampling Plan
(1) Explorative Research Design:
Explorative studies are undertaken with a view to know more about the problem. These studies help in a proper definition of the problem, and development of specific hypothesis is to be tested later by more conclusive research designs. Its basic purpose is to identify factors underlying a problem and to determine which one of them need to be further researched by using rigorous conclusive research designs.
(2) Conclusive Research Design:
Conclusive Research Studies are more formal in nature and are conducted with a view to eliciting more precise information for purpose of making marketing decisions.
These studies can be either:
a) Descriptive or
b) Experimental   
Thus, it was mix of both the tools of Research Design that is, Explorative as well as Conclusive.
SAMPLING PLAN:
Sample Size = 50 Employees
           Sample Area = Maruti Udyog HO, Gurgaon,
Duration = Two (2) Months.
DATA COLLECTION:
            Data Sources:
(i)  Secondary Data through Internet
(ii) Primary Data through Questionnaire
(iii) Contact Method
(iv) Personal Interaction
DATA PRESENTATION AND ANALYSIS:
1.    Bar graphs
2.    Pie Diagrams
3.    Doughnuts


FINDINGS AND ANALYSIS

Employees Opinion as to the Purpose of Potential Appraisal
Potential standards / yardsticks

Options
Response
Yes
84
No
16



Awareness of technique of Potential Appraisal being followed at BSNL among Employees

Options
Response
Yes
72
No
28



Number of Employees being appraised during their service period
Options
Response
Yes
68
No
32








Employees’ opinion as to the present appraisal system


Options
Responses (in %)
Fully Satisfied
64
Satisfied
24
Can’t Say
2
Dissatisfied
10




Employee perception as to the frequency of appraisal


Options

Response (in %)

Once During The Service Period
2
Continuous
92
Never
0
Can’t Say
6



If continuous appraisal – what should be the gap between two  appraisal period

Options

Response (in %)

Quarterly
20
Half Yearly
44
Yearly
36



How Potential Appraisal affects the productivity of the employees


Motivated
Indifferent
Demotivated
+ Feedback


38

12

-
-  Feedback


12

10

28

Neutral


24

21

5





Who should do the appraisal?

Options
Response ( in % )
Superior
24
Peer
0
Subordinate
0
Self Appraisal
8
Consultant
4
All of the above
48
Superior + Peer
16




.Does appraisal help in polishing skills and Potential area?

Options
Response ( in % )
 Yes
74
 No
10
 Somewhat
16



If the process of appraisal does not lead to the improvement of the skills and proficiency of the employees, the very purpose of appraisal becomes illogical. In the survey conducted it was observed that nearly 74 % of the respondents agree that Potential Appraisal does leads to polishing the skills of the employees. Nearly 10 % of the respondents view that it does not serve this purpose and around 16 % were not able to respond as to whether it serve any such purposes or not.



Does personal bias creeps-in while appraising an employee

Options
Response ( in % )
    Yes
18
    No
82

In the process of appraising, both the parties are human being, that is, the one who is being apprised and the other who is appraising. Thus, there bound to be subjectivity involved, be it an objective way of appraising.
Thus, when asked from among the sample size of 50 respondents, as small as merely 18 % respond ended that personal bias do creep in while appraising an individual. Hence, it is inevitable to say that personal likings do not come in the process of appraisal. It is the extent to which the appraiser manages it so that it does not become very partial and bias.


If given a chance, would employees like to review the current appraisal technique?
Options
Response ( in % )
 Yes
72
 No
4
 Can’t Say
24



Appropriate method of conducting the Potential appraisal
12%
0%
20%
58%
4%
6%
Rating Scale
Paired Comparison
Critical Incident
MBO
Assessment Centre
360 Degree





LIMITATIONS

A few limitations and constraints came in way of conducting the present study, under which the researcher had to work are as follows:
·         Although all attempts were made to make this an objective study, biases on the part of respondents might have resulted in some subjectivity.
·         Though, no effort was spared to make the study most accurate and useful, the “sample Size” selected for the same may not be the true representative of the Company, resulting in biased results.
·         This being the maiden experience of the researcher of conducting study such as this, the possibility of better results, using deeper statistical techniques in analyzing and interpreting data may not be ruled out.



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he organization. To be an effective tool, it has to be on the continuous basis. This is the thing that has been mentioned time and again in the report, as, in the absence of continuity, it becomes a redundant exercise. Before actually deciding drafting what should be the kind of appraisal the following things should be taken care of:
1.    The very concept of Potential appraisal should be marketed throughout the organization. Unless this is done, people would not accept it, be it how important to the organization.
2.    To market such a concept, it should not start at bottom, instead it should be started by the initiative of the top management. This would help in percolating down the concept to the advantage of all, which includes the top management as well as those below them. This means that the top management has to take a welcoming and positive approach towards the change that is intended to be brought.
3.    Further, at the time of confirmation also, the appraisal form should not lead to duplication of any information. Instead, detailed appraisal of the employee’s work must be done – which must incorporates both the work related as well as the other personal attributes that are important for work Potential.
4.    It should be noted that the appraisal form for each job position should be different as each job has different knowledge and skill requirements. There should not be a common appraisal form for every job position in the organization.
5.    The job and role expected from the employees should be decided well in advance and that too with the consensus with them.
6.    A neutral panel of people should do the appraisal and to avoid subjectivity to a marked extent, objective methods should be employed having quantifiable data.
7.    The time period for conducting the appraisal should be revised, so that the exercise becomes a continuous phenomenon.
8.    Transparency into the system should be ensured through the discussion about the employee’s Potential with the employee concerned and trying to find out the grey areas so that training can be implemented to improve on that.
Ideally in the present day scenario, appraisal should be done, taking the views of all the concerned parties who have some bearing on the employee. But, since a change in the system is required, it cannot be a drastic one. It ought to be gradual and a change in the mindset of both the employees and the head is required. 
        a) Fully Satisfied                         b) Satisfied

c) Can’t Say                            d) Dissatisfied

6.    Should the appraisal process be:
        a) Once during the service period         b) Continuous
        c) Never                                                d) Can’t Say
                                            
7.     What in your opinion should be the time period of conducting continuous     Appraisal?
a)    Quarterly       b) Half Yearly        c) Yearly

  Any specific reason………………………………  
8.  Does Potential Appraisal helps in improving the productivity of the employees?

Motivated
Indifferent
Demotivated
+ Feedback



-  Feedback



Neutral



                                                                  
9.     Who in your opinion should appraise the employee?                
a)    Superior                    b)  Peer
         c) Subordinates                    d) Self Appraisal
         e) Consultant                       f) All of the above    
10.    Does the appraisal system helps in polishing the skills or Potential area?
                a)  Yes                     b) No             c)  Somewhat 
11.    Do you think personal bias creeps in while appraising an individual?
    a)  Yes              b) No
12.    If given a chance or an opportunity would you like that the current appraisal procedure should be reviewed?
         a) Yes                         b) No                c) Can’t Say
13.    What according to you should be the appropriate method for conducting Potential appraisal?
a)    Rating the employee on number of traits along with the range of Potential for each by the supervisor.        
b)    For every trait, each subordinate is paired with and compared to every other  Subordinate.
c)     Reviewing employees on the basis of  identified specific examples of good   Or poor Potential.
d)    Setting specific measurable goals with each employee and periodically reviewing the progress made.
e)   Reviewing Potential through case studies, presentations, role playing, etc.  for future Potential.
f)      Receiving feedback from people whose views are considered helpful and relevant including the appraise himself.     
14.    Does Potential Appraisal leads to identification of hidden potential of the employees?
             a)  Yes                                                           b)  No         
15. Suggestions and views…………………………………...............................
…………………………………………………………
…………………………………………………………
…………………………………………………………


Thank you,                                                         Date --/--/--


BIBLIOGRAPHY

  1. www.marutisuzuki.com
  2. Google
  3. Esnips
  4. www.managementparadise.com


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