Assignment

On

Principals and Practices of Management

By

Swarnima Tiwari

Momita Dey

Deibok Pala

Franky Shylla

Gary Lyndoh

Iateiborlang warner

Contents

Page no.

1. ORGANIZATIONAL BACKGROUND

1.1 Name of the company 1

1.2 Company background 1

1.3 Vision and Mission 1

2. ORAGNIZATIOANL STRUCTURE

2.1 Theoretical concept 2-3

2.2 Organizational structure of the company 3-4

3. DIRECTING AND CONTROLLING

3.1 Theoretical concept 5-6

3.2 Direction and Communication in the company 7

4. MOTIVATION

4.1 Motivation in the company 8-9

5. CONTROLLING

5.1 Theoretical concept 10-11

5.2 Controlling in the organization 12

6. Methodology

6.1 Research Methodology 13

6.2 Research Design

7. Questionnaire 14

8. Sources 15

1. Organizational Background

1.1 Name of the company: The Company taken under study was Reliance Life Insurance co. Ltd.

1.2 Company background: Reliance Life Insurance co. Ltd is a part of reliance capital Ltd. Of the Dhirubhai

Ambani Group. Reliance capital is one of India’s leading private sector companies, and ranks among the

top 3 private sector financial service and banks in terms of net worth. Reliance capital has interest in asset

management and mutual funds, stock broking, life and general insurance, proprietary investments, private

equity and other financial services.

Reliance capital Limited (RCL) is a non-banking financial company (NBFC) registered under Reserve Bank of

India under section 45-IA of the reserve bank of India Act, 1934.

Reliance capital seems immense potential in the rapidly growing financial services to become a dominant

player in this industry.

Reliance Life Insurance is another step forward for Reliance Capital Limited to offer Life Insurance

solutions to individual and corporate. Reliance life Insurance also has presence in communications, natural

resources, media entertainment, health care and infrastructure.

1.3 Vision and Mission:

Vision:

Empowering everyone live their dreams.

Mission:

Create unmatched value for everyone through dependence, effective transparent and profitable life

insurance and pension plans.

Goals:

Reliance Life Insurance would strive to achieve the 3 goals mentioned below:

Emerge as a transparent Life insurer of global scale and standard.

Create best values for customers, shareholders and stake holders.

Achieve impeccable reputation and credentials through business practices.

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2. Organizational structure

2.1 Theoretical Concept: An organization is a social unit of people, systematically arranged and managed to meet

a need or to pursue collective goals on a continuing basis. All organizations have a management structure that

determines relationships between functions and positions, and subdivides and delegates roles, responsibilities,

and authority to carry out defined tasks. Organizations are open systems in that they affect and are affected by

the environment beyond their boundaries

An organizational structure is a mainly hierarchical concept of subordination of entities that collaborate and contribute to serve one common aim. Organizations are a variant of clustered entities. An organization can be structured in many different ways and styles, depending on their objectives and ambience. An organizational structure should be designed to clarify who is to do what task and who is responsible for what result, too remove obstacles to performance caused by confusion and uncertainty of assignment, and to furnish d ecision making and communication networks reflecting and supporting enterprise objectives. The structure of an organization will determine the modes in which it operates and performs.

Organizational structure allows the expressed allocation of responsibili ties for different functions and processes to different entities such as the branch, department, workgroup and individual. Individuals in an organizational structure are normally hired under time-limited work contracts or work orders, or under permanent employment contracts or program orders.

Types of Organizational Structure: Organizational structures take different forms. Following are the broad types

of structural forms:

1. Functional and Divisional Structures

2. Vertical and Horizontal structures

3. Mechanistic and Organic Structures

4. The Matrix structure

Functional and Divisional structures: The oldest and commonly used method is functional. In functional structure, organization is departmentalized on the basis of functions performed by it . In case of divisional structure, organization is departmented on the basis of product, customer or region. Vertical and horizontal: Organizations having a series of narrow spans control were termed as vertical structures. On the contrary, structures incorporating wide spans and limited layers of control at horizontal levels were termed as Horizontal structures. Both the structures have their advantages and disadvantages. For example, vertical structure (tall structure) calls for control and close supervision over the subordinates. Similarly, in case of horizontal structures, it may not be possible to keep close control Over subordinate but it provides for decentralization, individual initiative and self -control. Nonetheless, vertical or tall structures are less favorably viewed in modern organizations.

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Mechanistic and organic Structures: The contrasting types of organizational structure were commended by Burns and Stalker in their study of twenty industrial firms in England. The structure suitable to stable conditions was termed as mechanistic Structure while the one considered appropriate to changing conditions was called organic Structure.

The Matrix Structure: The matrix organization structure was proposed by Daris and Lawrence for aero space program of United States. In this structure, attempts were made to combine the advantage of product and functional departmentalization; attempts were made to combine the advantages of product and functional departmentalization to achieve the organizational goals. In other, this dual structure simultaneously organizes part of organization along product lines and part of the organization along functional lines to gain the advantages of both. Such a simultaneous overlapping of these two functions line to gain the advantages of structure.

Success factors

Common success criteria for organizational structures are:

Decentralized reporting Flat hierarchy High transient speed High transparency Low residual mass Permanent monitoring Rapid response Shared reliability Matrix hierarchy

2.2 Organizational Structure of Reliance Life insurance: The organizational structure of Reliance Life Insurance Co. Ltd is of Agency type and is a vertical and hierarchical

and formal in nature; which consists of the top level managers; middle -level manager and the lower level

managers. The top level managers are the CEO, group presidents, national head (agency); these are the top level

managers who deal with planning and setting of organizational objectives and goals. Next are the middle level

managers; which consist of zonal Business heads and Regional managers, who take part in implemen ting and

controlling apart from planning and controlling, at present the company at national level is divided into seven

regions. A regional manager is assigned to each region that is to ensure that the working activities do not deviates

from the actual organizational goals to these there are Territory managers. A branch or territories manager falls

under the regional managers in the hierarchy; followed by sales managers, constituting the lower level managers.

Branch or territory manager is assigned with the task of looking after the functions and performance of a branch;

assisted by sales managers, and advisors who actually look after the sales of the company. There are 11 divisions

of sales managers in Reliance life Insurance co. Ltd which consist of PSM, JSM ,ASM, SM, SSM, ESM, BDM, Sr

BDM, AP, Partner, Sr partner.

Reliance Life Insurance Company Ltd as a branch in Tura was established on 29th August 2007 and is located at Tura bazaar. Its regional office is in Bongaigoan.

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Fig. Organizational Structure of Reliance Life Insurance Co. Ltd

Fig: Organizational structure of Reliance Life Insurance in Tura Branch

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CEO

Group-President

Zonal Business Heads

Regional Managers

Teritory Managers/Branch Manager

Sales Managers

Advisor/Agent

Branch Manager

Sales Managers

Advisors/Agents

Customers

ASM JSM PSM SM SSM ESM BDM

AP Sr BDM Partner Sr Partner

3. DIRECTING AND COMMUNICATION

3.1 Theoretical concept of Directing and communication:

Directing: Direction is a vital managerial function. For the effective implementation of any administrative

decision, planning, organizing and staffing are not enough. The manager must stimulate action by giving direction

to his subordinates through orders and also supervise their work to ensure that plans and policies achieve the

desired actions and results. Planning, organizing and staffing are concerned only w ith the preparation for work

performance and it is the direction which alone stimulates the organization and its staff to execute the plans.

Hence it is also called management-in-action.

Direction means issuance of orders and leading and motivating subordi nates as they go about executing orders.

Without the issuance of orders, without leading and motivating subordinates, nothing, or at best very little, can be

accomplished. According to Koontz and O’ Donnell, “direction is the interpersonal aspect of managi ng by which

subordinates are led to understand and contribute effectively and efficiently to the attainment of enterprise

objectives”. The function of direction thus breakdown into two major activities:

1. Giving orders to employees, and

2. Leading and motivating them.

Requirements of Effective Direction:

Direction is one of the most complex functions of management which can be learned and perfected only through

long experience. However, some important principles or requirements of effective direction may be out lined as

under.

Harmony of objectives: as organization functions best when the goals of its members are in complete harmony

with and complementary to the goals of the organization. Such an ideal situation seldom exists in any

organization. Nor should a manager ever expect this situation to exist. But in directing subordinates he must take

advantage of individual motives to gain group goals. In other words, he must direct the subordinates in such a way

that they perceive their personal goals to be in harmony with enterprise objectives. Thus, for example, if

employees are told to work hard so that the company’s profit may increase, they probably will not. But if they are

told to o so in their own interest (e.g., to receive additional bonus or promotion) they are more likely to work

hard.

Unity of command: this principle implies that the subordinate should receive orders and instructions from one

superior only. The violation of these principles may lead to conflicting orders, divided loyalties and decrease

personal responsibility for results. Another reason why this principle should not be violated is that the immediate

boss is the only person who knows best about the nature of his subordinates and about their responses to

different motivation techniques. Consequently, he is in the best position to select whichever directing techniques

maximize their productivity. No other outside interference in the supervision of subordinates should then be

permitted.

Direct supervision: Every superior must maintain face-to face direct contact with his subordinates. Direct

supervision boosts the morale of employees, increases their loyalty and provides them with immediate feedback

on how well they are doing.

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Efficient communication: Communication is an instrument of direction. It is through communication that the

supervisor gives orders, allocates jobs, explains duties and ensures performance. Efficient communication is a two -

way process. It no only enables the superior to know how his subordinates feel but also helps the subordinates to

know how the company feels on a number of issues concerning them. In communication, comprehension is

important than the content. How much information is correctly understood by the subordinates is more

important than what is said and how it is said. This can be ensured only if the manager makes provision for a

proper feedback.

Communication: Communication is the process of transmission and reception of information, ideas, opinion,

messages etc between people. As it is the process of transmitting and receiving, Communication involves people

at least two, one to transmit and the other to receive the message or opinion.

Process of communication

1. The process of communication begins with the sender of the source. The sender has the intended

message to communicate.

2. The sender encodes or translate the idea into message e.g. letter, phone, face to face communication

3. The message is the physical form into which the sender encodes the information

4. The channel is the medium through which the message is transmitted

5. Decoding is the five steps in the process of communication. Decodes mean the interpret of a message by

the receiver

6. Receiver is the person who received the message

7. Feedback is the response of the receiver to the message.

Types of communication

A. On the basis of organizational structure

a. Formal communication

b. Informal

B. On the basis of direction

a. Downward communication

b. Upward

c. Horizontal

d. Diagonal

C. On the basis of way of expression

a. Verbal communication

b. Written

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3.2 Directing & Communication in Reliance Life Insurance Co. Ltd:

Directing: Directing is one of the basic function of management and is very essential for the success of any

organization. Directing is also practices in Reliance Life Insurance Co. Ltd. In reliance Life Insurance Co. Ltd the

lower level managers are directed by their immediate superior. For example the advisors are directed by their

sales managers, sales managers are directed by branch managers or territory managers; branch or territory

managers are directed by regional managers and Regional mangers are directed by Zonal business Managers and

ZBM’s are directed by National heads and so the National heads are directed by Group President and CEO. Each

manager is responsible for its subordinates.

Communication: Effective communication is very essential for any organization, so reliance Life Insurance also

focuses on having an effective communication in their company. Reliance Life Insurance has both formal and

informal type of communication, which is mostly in downward direction, but sometimes they even follow upward

communication depending upon the situation, which may be written and verbal, but mostly they follow written

communication. Superiors generally contact with their subordinates through their immediate boss or through

emails over telephone.

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4. Motivation in Reliance Life Insurance co. Ltd

Motivation is ‘the process that accounts for an individual intensity direction and persistence or effort towards

attaining a goal; for this reason motivating employee is very important in any organization.

Reliance Life insurance also focuses on motivating its employee. Reliance Life Insurance motivate its employee

mainly by financial and non-financial tools like money or money’s worth, like wages and salaries, bonus, medical

benefits, commission, incentives like praise, knowledge of results, participation in management opportunity for

growth, conductive work environment, challenging job etc.

It motivates its advisors by giving them:

1) Commission: all the advisors in Reliance Life Insurance Co. Ltd are given commission on all the policies they

bring to the company, at a fixed rate.

2) Contest Payouts: They run contests through out the year among the advisors to motivate them to work

hard to get the benefits of commission.

3) Foreign trips: the company also gives foreign trips to the advisors with outstanding performance, with the

motive to motivate the advisors.

4) Career: The Company also provides the advisors with a scope of career advancement, if he/she gives a

business of 3 lakh with 30 policies within a financial year, given that the person is a graduate. Then he/she

will be promoted as a sales manager in the company.

5) Club Membership: the company also runs a another type of contest known as club membership, in which if

a advisor fulfills the criterion, he or she will be rewarded as a club member of the company. He following

are the criterion to become the club member of Reliance life insurance co. Ltd:

Company Club Membership:

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International Club Membership:

The company takes special care to motivate its sales manager, apart from salary, the company also gives its

employees incentive, promotion, rewards and recognition, foreign trips and the most important is the company’s

share.

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5. Controlling

5.1 Theoretical Concept of Controlling: The management function of control is the measurement and

correction of performance in order to make sure that enterprise objective and the plans devise to attain them are

being accomplished. The main objective of control is to bring to light the variations between the standards set and

performance and then to take necessary steps to prevent the occurrence of such variations in future. It is the process

through which managers assure that actual activities conform to the plan activities. In the words of E.F.L. Brech,

‘control is checking current performances against predetermined standards contained in the plans, with a view to

ensuring adequate progress and satisfactory performance”.

Steps in a control Process; There are three basic steps in a control process:

1. Establishing standards

2. Measuring and comparing actual results against standards and

3. Taking corrective action.

Need for control:

A control system is needed for three purposes:

1. To measure progress;

2. To uncover deviations and;

3. To indicate corrective action.

Types of Control:

Most control methods can be grouped into one or two basic types: past oriented controls and future oriented

controls.

1. Past-oriented control: These are also known as post action controls and measure results after the process. They

examine what has happened in a particular period in the past. Examples of such controls are most accounting

records, inspection of goods and services and school grade reports. These controls can be used to plan future

behavior in the light of past errors or successes. They can also be used as a basis for rewarding discipline, training

or promoting individuals.

2. Future-oriented controls: These are also known as feed-forward controls and are designed to measure results

during the process so that action can be taken before the job is done or the period is over. They serve as warning

posts principally to direct attention rather then to evaluate. Examples of such controls are cash flow and fund flow

analysis, network planning etc , which enable manager to see that they will have problems in such areas cash or

on-time delivery unless they take prior action.

The two types of control that have been discussed above are not alternatives to each other. Most organizations

use both these types. Future- oriented controls be, however, particularly important because the information

feedback in them is at the input side of the system, s o that correction can be made before the system output is

affected. Also, no one would deny that, even with a future -oriented control, a manager would still want to

measure final output will always be exactly as is desired.

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Essentials of Effective control:

The essentials of an effective control system are as follows:

1. Suitable: the control system should be appropriate to the nature and needs of the activity. Controls used in the

sales department will be different from that used in finance and personnel.

2. Timely and forward looking: the control system should be such as to enable the subordinates to inform their

superiors expeditiously about the threatened deviations and failures.

3. Objective and comprehensible: the control system should be both objective and understandable.

4. Flexible: the control should be flexible so that it can adjust to suit the needs of any change in the environment.

5. Economical: the benefit derived from the control system should be more than the cost involved in

implementing it.

6. Prescriptive and operational: the control system in order to be effective and adequate must not only detect

deviations from the standards but should also provide for solutions to the problems that cause deviations.

7. Acceptable to organizational members: the system should be acceptable to organizational members.

8. Motivate people to high performance: a control system is most effective when it motivates people to high

performance.

9. Should not lead to less attention to other aspects: Control over phase of operation should not lead to less

attention to other aspects.

10. Reveal expectations at strategic points: a control system should be such as to reveal expectations at strategic

points.

Benefits of Control system:

A well developed control system

Increase productivity

Reduces defects and mistakes

Helps meet deadlines

Facilitates communication

Improves safety

Lowers cost, and

Gives the workers control over their environment

5.2 CONTROLLING IN RELIANCE LIFE INSURANCE Co. Ltd

Controlling is very important process through which managers ensure that actual activities conform to planned

activities. Reliance Life Insurance co Ltd also follows control techniques to ensure that their plans are best

achieved. Since Reliance Life Insurance Co. Ltd is a sales oriented company its basic aim to maximize its sales. So

control is Reliance Life Insurance Co. Ltd is basically carried out to ensure that the sales are at their peak.

Controlling in Reliance Life Insurance Co. Ltd is done in many ways. Each manager‘s activity is observed by his/her

immediate boss. Each manager have been given some specific set of routine which he or she has to follow and if

any manager does not follows it the senior manager has to report it immediately to his immediate boss an d take

necessary action against the person.

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6. Methodology

6.1 Research Methodology: There are various methods available for collecting the information. The methodology

used in conducting this was:

Questionnaires

Observations

Interview

Basically, there are two types of data methods: Primary and Secondary. My information’s are collected from both

the sources (primary and secondary).

Primary Data: The primary source includes:

1. Questionnaire: In this method a set f questions are prepared with a view to collect the requisite

information. For using this method, I first made the questionnaire, get it typed in the computer and then

obtained the printed questionnaires were then given to the respondents to f ill it. Questionnaire can be

classified into four main types:

a) Structured- non- disguised

b) Structured-disguised

c) Non structured-non-disguised and

d) Non-structured-disguised

Another important aspect in the questionnaire method is the type questionnaire methods is the type of questions

used. Questions can be classified into:

Open-ended questions and

Close-ended questions

In collecting the information about my project I used. Structured-non-disguised questionnaires and the type of

questions which I used in the questionnaire are mostly close-ended questions. All the close-ended are multiple

choices and the type of open-ended questions is completely unstructured.

2. Direct interviewing: oral interviewing (whether formal or informal) is one of the best ways to colle ct the

information. Most part of my information’s are collected with the respondents

3. Simple observation: observation is another important technique of collecting the information. Some of my in

formations are gathered from simple observations. Some things are easily observable but some are not. Whether

things I have observed are added to my information collected.

Secondary data: secondary data are those data which have been gathered earlier for some other purpose. The

primary data collected by one person may become the secondary for another.

For my study, I made use of these secondary sources too. The data I gathered through these secondary sources

are the company profile, area detail, company’s goals and objectives etc.

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6.2 Research Design:

Design of Research

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Primary data Secondary data

Sources of data

i. Questionnaire

ii. Observation

Data needed are founded

I. Company

II. Internet

Data analysis

7. Questionnaires

1. When was this branch established in Tura?

_______________________________________________________________________

2. What Type of Organization Structure do you have?

a) Functional and Divisional Structures ( )

b) Vertical and Horizontal structures ( )

c) Mechanistic and Organic Structures ( )

d) The Matrix structure ( )

3. How do you direct you’re Employees?

________________________________________________________________________

4. What type of Communication do you have in your organization?

a) Formal communication ( )

b) Informal communication ( )

c) Downward communication ( )

d) Upward communication ( )

e) Horizontal communication ( )

f) Diagonal communication ( )

g) Verbal communication ( )

h) Written communication ( )

5. How do you motivate your employees?

_________________________________________________________________________

6. Do you exercise control in your company?

Yes [ ] No [ ]

7. How do you exercise control in your company?

__________________________________________________________________________

8. What type of control technique do you follow?

a) Past-oriented control [ ]

b) Future-oriented control [ ]

c) Both [ ]

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9. Bibliography:

1. Beri G.C, “ Marketing Research”3rd edition (new delhi:Tata Megraw –hill publishing company

limited)

2. Khanka S.S, “Organizational Behavior” (New Delhi: S.Chand & Company Ltd.)

3. Koontz Harold and Weihrich Heinz,” Essentials of Management” sixth edition (new delhi:Tata

Megraw –hill publishing company limited).

4. Internet(www.reliancelifeinsurance.com)

5. Triphati P.C, “Principlas of Management

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