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POWER HR FORUM Q4E - 2005

Roadmap for Radical Performance Improvement Page 1 of 1

Quest for Excellence Q4E –2005

Theme:

Roadmap for Radical Performance Improvement

Sept 24, 2005, Power Management Institute, NTPC, Noida



C o n t e n t s

1 FOREWORD - Pg 3 2 About the Competition - Q4E - Pg 4 3 Presentation by Participating Teams

I Road for Radical Performance

Improvement

- Presented by NTPC, Kawas

- Pg 10

II Radical Performance Improvement - A Roadmap through Technology Innovation

- Presented by POWERGRID, Corporate, Engg. Deptt.

[Ist Runners-up]

- Pg 52

III Roadmap for Radical Performance Improvement

- Presented by NTPC, Dadri [2nd Runners-up]

- Pg 72

IV Roadmap for Radical Performance Improvement Through Information Technology

- Presented by POWERGRID, Corporate, IT. Deptt.

- Pg 118

V Radical Improvement in Performance of Organization – Redesigning Incentive Payment System Application of Balance Scorecard

- Presented by PFC

- Pg 146

VI Leveraging ICT for integrating business processes – NHPC Experience

- Presented by NHPC, Corporate, IT. Deptt.

- Pg 164

VII Construction equipment management for completion of Hydro electric Projects – A Road Map

- Presented by NHPC, Corporate, CEP Division

- Pg 182

4 Power HR Forum in Brief - Pg 201

[Winner]



Foreword It gives me immense pleasure to share with you the maiden issue of compendium of the presentations submitted by teams in the final event of the Inter Power PSU competition titled “Quest for Excellence (Q4E) – 2005”.

Started from the year 2004, this competition “Quest for Excellence” is an endeavor to unleash in our employees a competitive drive and a lifelong learning paving the for the member organizations to be a part of the successful twenty first century brigade. The theme of the Quest for Excellence (Q4E) –2005 is “Roadmap for Radical Performance Improvement”. Some of the suggestions given by the participants are truly commendable and could be a valuable source of reference. This is an annual event of Power HR Forum and I call upon all member organizations to encourage the employees to participate in large numbers in the future events of Q4E. Lastly, I express my sincere thanks to NTPC for making the event a great success.

(U C Misra) Director – Personnel, POWERGRID &

President – Power HR Forum



“Quest for Excellence ( Q4E)” 1. OBJECTIVES

Main objectives of the Competition are as under.

To develop general management skills among Junior / Middle level Executives.

To promote skill in literature survey and research To encourage creativity and innovative thinking. To encourage teamwork and build team spirit. To enhance presentation skills.

2. ELIGIBILITY 2.1. The competition is open to the employees in member

organizations of Power HR Forum. Presently the member organizations are,

1. Bhakra Beas Management Board (BBMB) 2. Damodar Valley Corporation Ltd.(DVC) 3. National Hydroelectric Power Corporation Ltd.(NHPC) 4. National Thermal Power Corporation Ltd. (NTPC) 5. North Eastern Electric Power Corporation Ltd.

(NEEPCO) 6. Power Finance Corporation Ltd. (PFC) 7. Power Grid Corporation of India Ltd. (POWERGRID) 8. Rural Electrification Corporation Ltd. (REC) 9. Satluj Jal Vidyut Nigam Ltd. (SJVN) 10. Tehri Hydro Development Corporation Ltd.(THDC)

2.2. Each member organization can send a maximum of two teams

and each team may comprise of a maximum of three members up to the level of Dy. General Manager or its equivalent.



3. PROCEDURE 3.1 The competition will be on an annual basis. 3.2 The tentative schedule of the events in each year shall be as

under:

Announcement of the theme of competition

January first week

One day introductory Program June first Week Last date for Registration July last week

Last date for submission of Written Papers

September second week

Date of Competition September last week 3.3 The theme of the competition will be decided by the Forum

and notified through Circular inviting entries from member organizations.

3.4 The theme will be of topical interest and relevant to Business

Management, not necessarily pertaining to any of the member organizations or any particular area of work/specialization.

3.5 The teams would be given a copy of the Guidelines / Format

for Presentation (Annexure-I) and Evaluation Criteria (Annexure-II) after due registration.

3.6 The participating team will submit a written paper, not

exceeding 3000 words by the due date to the Forum’s Secretariat. The team will submit one soft copy (preferably in a CD in MS Word) and four bound copies.

3.7 The paper shall preferably be based on new ideas and

innovative approach supported by analysis of data from pertinent sources, including organizational examples wherever applicable.



3.8 During the final evaluation, each team shall make an oral presentation comprising 15 minutes for the presentation and 10 minutes for discussion with the Panel of Judges. It is essential that all the team members should participate in making the presentation.

3.9 A Panel of three Judges constituted by the Forum whose

decision shall be final and binding shall evaluate the written paper as well as the oral presentation.

3.10 Based on the final scores in the oral and written competitions,

the Panel of Judges will declare the Winners and Runners up. 4. PARTICIPATION FEE

A participation fee of Rs. 10,000/- per team is to be sent to the Forum Sectt. at the time of registration.

5. PRIZES & RECOGNITIONS 5.1 The winning team will receive a cash prize of Rs. 10,000/-

plus a Trophy and a certificate.

5.2 The runners up team will receive cash prize of Rs 5,000/- plus a Trophy and a certificate.

5.3 All the participating team members shall be presented with a

certificate and a token award for participation. 5.4 Suitable coverage will be extended to the winners of the

competition in the Journal and Web Site of the Forum. 6. GENERAL 6.1 The entire competition will be coordinated/ administered by

the Sectt of the Forum. 6.2 The Power to modify these guidelines shall vest in the

Governing Body of the Forum.



Quest for Excellence ( Q4E) - Guidelines for Presentations WRITTEN PRESENTATION 1.1 The written presentation should be neatly typed on A4 size

paper and should be within 3000 words. Charts, diagrams, etc., may be included to support any research work or data collection. The team should also send an abstract of their presentation in not more than 300 words.

1.2 The first page of the written presentation shall be in the

format given below: 1.3 Each team is required to submit one soft copy (preferably in a

CD in MS Word) and three bound copies of the written presentation.

ORAL PRESENTATION 2.1 Each team will get a total of 25 minutes for the oral

presentation as well as the discussion. The first 15 minutes will be used for presentation by the team and the subsequent 10 minutes will be used for discussion with the Panel and the

Quest for Excellence ( Q4E) Theme: Team Leader Team Members :1.

2. Organization : No. of words: Date of submission: Signature of Team Leader :



team members. It is essential that all the team members should participate in making the presentation.

2.2 The teams should bring main findings and points in their

presentations before the Judges. 2.3 OHP/Computer Projection system would be provided at the

venue of the oral presentations. The decision of the Panel of Judges shall be final and

binding.



Quest for Excellence (Q4E) – Evaluation Criteria

CRITERIA WEIGHTAGE

1. WRITTEN

1.1 Conceptual clarity 15 1.2 Original inputs and Creative

Content 10

1.3 Linkage to practical issues 10 1.4 Workable Recommendations 20 1.5 Literature survey, Extent and

source of Research 15

Sub Total 70

2. ORAL

1.1 Clarity and Substance in the Presentation

10

1.2 Response to Questions 10 1.3 Team Work in Presentation 10

Sub Total 30 _____________________________________________________ Total 100 _____________________________________________________



Q4E- 2005 Winner : Suresh Mahajan Sanil Namboodiripad Gurpreet Singh

Organisation : NTPC Ltd. - Kawas

Title : Road for Radical Performance Improvement



he process of globalization and the revolution of information and communication technologies (ICTs) have imposed radical changes in organizations and their

work systems. Indeed, an organization’s survival and growth is becoming more dependent on ability to apply new knowledge and technology as well as being able to quickly respond to the competitive changing environment. In addition, the basic economic resource is no longer capital, natural resources or labor, but is more likely to be knowledge. Currently, and in the future, the most successful organizations are likely to be those that are able to assess, anticipate and transform their environments, constantly developing themselves in the innovative ways.

Leaders today face a predicament

that is wider in scope and

more difficult to

overcome than ever before - how to achieve sustainable business results while contending with accelerating, unprecedented change. The way leaders respond to this predicament will determine whether their organizations become market leaders, followers or failures.

T

Radical Thinking



Why is it that some leaders manage to get their organizations on a path of sustainable performance while others cannot? The answer may lie in the choice of the improvement strategy they employ. Quick fixes and piecemeal approaches to making organizational changes to improve performance tend to result in isolated and temporary improvements. What is really needed is a means to sustain radical performance improvements organization-wide, year after year, thus enabling a quick adaptation to changing events.

What is Radical Performance Improvement?

Literally the term ‘Radical’ means drastic, sweeping or revolutionary. But how much improvement can we really call ‘Radical’? Richard Leifer, after consulting many experts from Industrial research Institutes, in his book “Radical Innovations” has concluded following pragmatic definition for Radical performance improvement: Radical performance improvement project is one with the potential to produce one or more of the following:

1. An entirely new set of performance features; or 2. Potential for significant Improvement in known performance

features (5 times or greater) or 3. Potential for significant cost reduction (30% or greater).

Radical improvements create such dramatic changes in products, processes or services that they transform existing markets or create new ones. Becoming lean and mean can make an organization competitive for a short time, incremental innovation can help it become competitive within the current product platform, but only radical innovation can change the game. Key drivers of Radical Performance Improvement:



For radical performance improvement and its sustenance, a right balance of the two improvement activities is essential:

1. Rationalization of existing activities, leading to ongoing improvement in productivity and performance. (Incremental innovation)

2. Achieving growth and expansion through continuous revitalization of strategy, organization and people. (radical innovation)

Scholars have long distinguished between these two kinds of improvement activities. For example, James March made a distinction between exploitation of existing technology and exploration of new technology. Exploitation activity has to do with refining or expanding existing products or processes (incremental innovation) , whereas exploration involves something fundamentally new, including new products, processes, or combinations of the two ( Radical innovation). Sumantra Ghoshal and Gita Piramal, in their book “Managing Radical Change” coined the words “sour” and “sweet” for distinguishing the two kinds of improvements. The rationalization process which is a

Radical Performance Improvement

Improving Resource

productivity (Sour)

Creating & exploiting new opportunities

(sweet) Incremental Innovation

Radical Innovation



part of incremental innovation is often unpleasant – few managers enjoy closing plants, selling businesses & sacking people - and therefore this is a “sour” activity. Revitalization, which is a part of radical innovation, on the other hand, is a “sweet” activity. Most managers love growth; they love dreaming up a vision and driving their organization to match their dreams. Vadim Kotelnikov, has used the words “improvement strategies” and “venture strategies” to distinguish between the rationalization and radical revitalization activities. The problem is that most managers see the processes of rationalization and revitalization as mutually exclusive, but they are rather complementary to each other.

VENTURE STRATEGIES • In-company

Ventures

• Spinouts

• Venture Investing

• Venture Acquisitions

Strategies for radical performance improvement Achieving Radical Top-Line Growth and Bottom-Line Results

“Shun the incremental and go for the leap.“ - Jack Welch

IMPROVEMENT STRATEGIES

• Business Process Management

• Incremental Innovation

• Continuous Improvement Firm (CIF)

• Quality Management / Six Sigma



Error! For sustaining superior corporate performance, a right balance of these two symbiotic forces is needed. Neither of them alone can guarantee the consistently high performance. In their quest to achieve radical performance improvement through rationalization and cutting alone, many companies or caught in what Sumantra Ghoshal calls a ‘vicious downward spiral’. Once a company cuts investment in technology, people & equipment , the financial results improve, but only for a while. The real underlying problems are not solved through the cuts and performance declines again, triggering off the next round of cuts in the spiral. On the other

RADICAL INNOVATION Project Trajectory

• Explores new technology

• High uncertainty

• Focuses on products, processes or services with unprecedented performance features

• Creates a dramatic change that transforms existing markets or industries, or creates new ones

• Exploits existing technology

• Low uncertainty

• Focuses on cost or feature improvements in existing processes, products or services

• Improves competitiveness within current markets or industries

Radical versus Incremental Innovation INCREMENTAL INOVATION Project Trajectory



hand, the companies trying to achieve radical performance improvement by focusing on growth alone , without any attention to productivity improvement, may also not sustain the spectacular performance for long. Essar is one such example – the Ruia brothers, starting from a small sponge iron plant have grown to a 33,00-crore conglomerate that lacks underlying competitiveness in many of its core businesses. After an initial phase of euphoria, the performance has plunged. Performance improvements of this magnitude can be made and sustained only when the means to achieve them is embedded in the fabric and culture of the organization. Radical performance improvement is not a one-time event. It is a continuous process that can rescue an organization from its predicaments and help it deal successfully with accelerating change that is not only fraught with danger, but also abounds with opportunities.

Some myths about Radical Performance Improvement High-performance companies exist in “attractive” industries only

A company cannot achieve outstanding performance when its industry is shrinking

Outstanding performance cannot be achieved when competitors are bigger and stronger

Radical performance improvement is not possible when you are already very successful

Charismatic leadership is a perquisite for radical performance improvement

Learning how to practice radical improvement is a critical but difficult challenge because:



Radical efforts produce more failures than successes (inherent nature of breakthroughs)

Timing of results is highly unpredictable Disseminating successful results requires special skills in cultural change

Concept is complex – about which there is little theory Radical process requires different leadership approaches from those that are effective in maintenance management or in incremental innovation.

Examples of radical innovation include computerized tomography (CT) and magnetic resonance imaging (MRI) in the field of diagnostic imaging; the personal computer in computing; and pagers and cellular telephones in mobile communications. The subsequent incremental and generational improvements in these technologies were not radical innovations as we define them. Our definition is driven by new value added to the marketplace rather than by technical novelty or newness to the firm.

Scholars further distinguish types of radical innovation with respect to alignment with the firm’s established lines of business. Considering



the variability of radical innovation projects, three types of radical innovations are identified:

Innovation within the technology/market domains of existing business units: These kinds of projects aim to replace existing technologies for essentially the same customers and markets. For example, GE’s development and commercialization of magnetic resonance imaging technology was a radical innovation, but the application space was already served by GE’s Medical Systems business unit. This type of radical innovation strengthens a firm’s position with familiar markets. A project idea that aims to serve current customers has an obvious home when it matures and is ready for commercialization. Thus, a constructive relationship between the business unit and the project can be established as it evolves, and organizational uncertainty is reduced. The infrastructure for contacting customers, understanding markets, and delivering the innovation are assumed to be well understood. Critical management issues involve cannibalization of current lines of business, and technological uncertainty in both development and production.

Innovation in the “white spaces” between a firm’s existing Businesses:

Radical new products that fall into the white spaces between existing businesses end up in either a new business unit or an existing one that is prepared to expand its scope. Though the markets served by these innovations are new for the firm, they are within the firm’s current strategic context. The IBM PC, for example, fell within IBM’s strategic context of computing but served new customers in new ways. 6 Radical Innovations



Innovation outside a firm’s current strategic context:

Innovations in this category open new and entirely unfamiliar markets. For example, Analog Device’s accelerometer chip ultimately found its application in the auto industry—outside the company’s strategic context. The auto industry and the technical applications were entirely new to Analog Devices. This third category embodies the highest organizational uncertainty. When it occurs, either the strategic context of the organization must be reset15 or the innovation must be “spun out” as a separate venture.

Radical Performance Improvement: a Roadmap In line with the above discussion, a 7-step road map has been prepared for achieving radical performance improvement in an organization. The Key steps of the roadmap are indicated below:

Systemic Approach to Innovation Seven Interwoven Areas

ti BUSINESS innovation

PRODUCT innovation

PROCESS innovation

RADICAL INNOVATION: Project Trajectory

ORGANIZATIONAL innovation

TECHNOLOGY innovation

MARKETING innovation




Capturing radical ideas in the fuzzy

front end

Managing radical innovation projects

Learning about markets for radical innovation projects

Resolving uncertainty in the business model

Bridging resource & competency gaps

Transition from RI projects to

operating status

Engaging individual initiative

Generation of good ideas Recognition of opportunities enabled by

breakthroughs Development & implementation of an effective

approach to initial evaluation

Articulation of Vision Uncertainty mapping Development of learning plan. Recruitment of champions Effective management of organizational interfaces.

Developing different market research questionnaire Conduct market research in new ways.

Decision making regarding what to outsource and what new competencies to be developed in-house.

Adoption of the business model in response to learning.

Resource acquisition Establishment and management of external and

internal partnerships.

Accurate assessment of the transition readiness of the project and the receiving unit.

Development & alignment of people, practices and structures for successful transition.

Building bridges between organizational units.

Defining the roles of senior management, key individuals and the project team

Building of appropriate reward systems and career paths Promotion of informal networks




1. Capturing radical ideas in the fuzzy front end:

This includes “Strategic Push” by senior management, issuing requests for proposals “holy grails” and articulating strategic intent. The key Enablers for Idea Generation are:

Think tanks Promoting connections to external sources of technical

information Technology forecasting exercises Adding opportunity recognition to technical reviews Creating an idea “sand box”

The management should recognize opportunities enabled by breakthrough ideas generated due to above initiatives and finally develop and implement an effective approach for initial evaluation of the ideas.

2. Managing Radical Innovation Projects:

Ideas

Profitable Innovation

Divergent Thinking (Loose Leadership)

Convergent Thinking (Tight Leadership)



After scrutinizing and filtering of the numerous ideas generated, the potential ideas are selected for undertaking radical innovation projects. The projects need meticulous planning and monitoring. The first step of the project management is to formulate a “vision” or direction for the project. This should be followed by mapping of possible uncertainties pertaining to the project and development of plans to minimize the same. Then the human and financial resources are planned and acquired. The champions for the project are recruited and an appropriate approach is established for effective management of interfaces within and outside the organization.

3. Learning about markets for radical innovation projects: The next step is to learn about the market – both within the core domain and outside it. This may include developing different market research questionnaires and conducting extensive market research in new ways.

Organization Uncertainty

Resour

ce Uncertainty

Technology Uncertainty

Market Uncertainty

Radical Innovation

Incremental Innovation Low

High



4. Resolving uncertainty in the business model:

It is prudent to adopt an appropriate business model in order to minimize uncertainties, based on the learning in earlier steps. The model should clearly focus on what to outsource and what new competencies to be developed in-house. Four typical approaches to business models are indicated below:

Competency and readiness model: build technical competency, and be prepared to sense opportunity as result and react quickly

Within core

market

Outside core market

What are the needs of the market that I need to address?

What are the key benefits of the product/ technology I want to exploit?

How are the same underlying needs being addressed in other Industries?

How could they be exploited for other applications in other markets, by meeting unmet needs?

Technology Development Market Development

Market research for Radical innovation Project

RI Models Competency and

readiness model

Strategy driven model Execution

driven model

Rational model



Strategy driven model : Define new technology growth area , and put resources behind them from start to finish .Coach entrepreneurial individuals to explore in these areas and build external capabilities in general domain… work with BU to connect to applications selection process driven by sr. management . Execution driven model: identify growth platforms based on independent initiatives underway throughout the company combine them, ramp them up into whole new business and Focus on clarity of strategy and calling on the whole organization to make those business happen. Rational model: CR&D is only about the RI most RI aligns with current businesses. Tight alignment with current businesses and senior leadership and getting senior leadership to think strategically about the future is the key. This model involves creating alternative structure for unaligned opportunities (venture group, bio based – material) and increasing exploratory research.

5. Bridging resource and competency gaps:

During this step, all the identified resource gaps are bridged by acquiring the same internally or externally. This also includes establishment and management of mutually beneficial external and internal partnerships.

6. Transition from RI project to operating status:



The smooth transition involves following steps: Accurate assessment of the transition readiness of the project and the receiving unit.

Development & alignment of people, practices and structures for successful transition.

Building bridges between organizational units.

7. Engaging individual initiative:

Final operationalization of the radical innovation is a very critical activity and needs involvement of highly committed and competent individuals. Some typical characteristic of the individuals appropriate for such teams are superior technical capabilities, Inquisitive, aggressive, risk taker, entrepreneurial etc. The final stage also requires appropriate systems development which includes defining the roles of senior management, key

Receiving Operating Unit

Orientation: Operational vs. Exploratory

RI Team Orientation: Exploratory

vs. Intensity to Close

Radical Innovation Hub: The Repository of Cumulative

Wisdom about RI

Transition Team Development types Operations Types Transition Experts



individuals and the project team; building of appropriate reward systems and career paths and promotion of informal networks.

Literature survey & research:

We have gone through various books and research papers on the topic of radical performance improvement, while preparing this paper.

During this exercise, we have come across two very interesting and relevant surveys – one conducted on the Global fortune 500 companies by M/s GFF (Global Future Forum) of UK and the other on Indian companies by SJ Phansalkar. We present below some aspects of these surveys:

The Business organization survey:

In November 2002, the Global Future Forum (GFF), an independent partnership of futurists, academics and business gurus, working with author and management guru Robert Heller, has conducted a research survey, titled the ‘Business Organization Survey’ to examine the issues regarding the changing face of business over the next five to ten years. The GFF was engaged by Unisys, a worldwide information technology services and solutions company with clients in more than 100 countries, for this work.

A questionnaire was sent from key members of the GFF to the CEOs and board members of the Fortune Global 500. They were asked for their opinions on issues such as: the ability of their organization to manage change, what internal barriers can hold back an organization, and how they see roles and responsibilities from CEO to middle management changing in the future. Completed questionnaires were received from 80 respondents. These respondents were asked to provide additional commentary on the Survey questions. The research reveals that the world’s largest companies are not doing enough to



plan for their futures. 58% of top executives in the Fortune Global 500 admit their organisation is ineffective at managing radical change.

The Fortune 500 look like they’re out of breath already: Fit for the future?

Almost 60% admit their organization is either ineffective or only fairly effective at managing radical change

Over 50% believe that the biggest changes to face the organization will come from ‘restructuring’ and ‘mergers & acquisitions’

1 in 4 companies admit little or no improvement will occur in their ‘ethical conduct’ between now and 2007

69% of those surveyed anticipate ‘greater supervision of the CEO’ by the board

77% expect complete/significant empowerment of managers beyond board level by 2010

The survey reveals that the world’s CEOs foresee change arriving in the form of restructuring (53%) and mergers and acquisitions (50%). The point of concern is that organizations seem to be anticipating ‘more of the same’ rather than effectively planning for the future by considering some of the radical changes that could face its business over the next 5 – 10 years. For example, the CEOs anticipate little improvement in the ethical conduct of their businesses over the next 5 years. This could prove fatal.

Survey Question Results What criteria are the most important The top three criteria receiving the



in judging the effectiveness of an organization?

highest score: • Financial performance (52%) • Customer satisfaction (41%) • Share price (18.5%)

How do you rate the effectiveness of your organization in managing radical change?

• Ineffective / fairly effective (58%)

Do you expect the organization to be reformed radically or substantially over the next 10 years?

• One year (29%) • 5 years (49%) • 10 years (22%)

What will these changes involve? • Restructuring (53%) • Mergers and acquisitions

(50%) • Customer relationships (48%) • Information technology

(40%) • Globalization (38%) • People policy (38%) • Outsourcing (20%) • Devolving authority (13%) • Self managed teams (8%)

What is the biggest difficulty your organization currently faces?

The top three difficulties receiving the highest score: • Organizational ‘silos’ (12%) • Under-performance (11%) • Communications (6%)

Do you foresee any significant changes in the CEO role over the next few years?

• Yes (68%) • No (32%)

If yes, what changes will this involve?

The top three changes receiving the highest score: • Greater regulation (20%) • Role sharing (14%) • Shorter tenure (13%)



As the result of the changes you foresee, where is your organizational effectiveness likely to improve over the next 5 years?

• Customer satisfaction (81%) • Financial performance (76%) • Growth rates (72%) • Employee satisfaction (67%)

Do you believe the Board’s role will change and that there will be greater supervision of the CEO?

Most likely/very likely (69%)

What degree of empowerment do you expect managers beyond board level to receive by 2010?

Complete/significant (77%)

Research by SJ Phansalkar: Indian scenario: Sanjay Phansalkar has conducted a research on Indian companies to establish the relationship between radical performance improvement and various innovative initiatives. The research consisted of an exhaustive survey conducted in four phases. In the first phase, he used export performance, sales performance and profit performance during the late Nineties, to identify high and low performing industry sectors .For this purpose, compounded annual rates of growth in these parameters were calculated for individual companies in the sector and then averaged for the sector. He chose four high performing sectors - pharmaceuticals, plastic products, textile processed IT and computers; and two low performing sectors namely Industrial machinery and cement. In the second phase, he used same three parameters to identify high and poor performing companies within each of these sectors. Six of each type were chosen for each sector. Their financials were analyzed and compared for the period of the Nineties. The third phase comprised conducting a primary survey. Finally, the fourth phase was preparation of case studies on 10 companies in these sectors.



He collected data on several aspects from 30 companies. Some aspects reflected mere cosmetic change, some reflected substantial change. He asked what the change was, and when was It introduced. The data is indicated below. The companies were classified as high performing if their CAGR in ROCE exceeded the average for the sample. Some excerpts of the interesting results of the survey are indicted below: Introduction of the new product S.No. Attribute category High

performing Low performing

1 Continuous introduction of the new product

10 0

2 Few (2-4) new products introduced

4 7

3 One new product or new application

1 5

4 No new product 0 3 Years when new products were introduced S.No. Attribute category High


1 All the time during the period

7 1

2 Before 1995 3 6 3 After 1995 or not at all 5 8



Change in overall production volume S.No. Attribute category High


1 Greatly increased >25% 13 3 2 Increased(10- 25%) 2 6 3 Flat (-10to 10%) 0 4 4 Decreased 0 2

Steps to meet rising production demand and making new products S.No. Attribute category High


1 Building new factories 6 4 2 Acquiring other factories 0 1 3 Sub contracting production 1 0 4 Multiple option used 6 0 5 No action taken 2 10

Extent of outsourcing of product and services S.No. Attribute category High


1 No outsourcing 5 9 2 Marginal outsourcing 4 3 3 Outsourcing of highly

skilled jobs 1 1

4 Some processes outsourced 3 0 5 Significant outsourcing 2 2



Adoption of TQM and ISO S.No. Attribute category High


1 TQM adopted 5 1 2 ISO or equivalent

implemented 12 6

3 Under implementation 1 1 4 Not applicable 2 8

Changes made in the organization S.No. Attribute category High


1 Organization structure changed

13 8

2 Current structure is functional

4 11

3 Current structure is divisional

3 3

4 Current structure is matrix form

2 1

5 SBU pattern 4 0 6 Combination 2 0 New senior management role created S.No. Attribute category High


1 No new roles 2 8 2 Functional roles 1 2 3 General management roles 8 4 4 SBU head type roles 4 1



Primary Survey & research (Power sector): Challenges for Indian power sector: As per the studies carried out by CEA, the energy requirement by the year 2025 will likely to be of the order of 1755 BU and the installed capacity required to meet these requirements of the order of 3,50,000 MW ie. almost about 4 times of the present capacity. The capacity addition required during 10th Plan (2002-2007) and 11th Plan (2007-12) would be of the order of 57000 MW & 59000 MW respectively. The country requires massive capacity additions during the next 25 years. On an average more than 10000 MW per annum capacity addition will be required as compared to the present addition of about 4000 MW capacity addition per year.

P e a k d e m a n d M W e x -b u s

2 1 3

1 0 2 1 1 6

1 5 7

1 0 0 1 2 0 1 4 0 1 6 0 1 8 0 2 0 0 2 2 0

2 0 0 4 - 0 5 2 0 0 6 - 0 7 2 0 1 1 - 1 2 2 0 1 6 - 1 7

T ho us an d



E n e rg y re q u ire m e n t G W h e x -b u s

1 ,3 19

9 75

6 35 7 1

96 00

8 00

1 ,0 00

1 ,2 00

1 ,4 00

2 0 0 4 -0 5 2 0 0 6 -0 7 2 0 1 1 -1 2 2 0 1 6 -1 7

T ho usan d

(Source: 16th Electric Power Survey of India) The Hon’ble Prime Minister & Chief Ministers have said before the nation the goal of electrifying all our villages by 2007 and all our house-holds by 2012. Access is yet to be provided to about 80,000 villages. Uninterrupted and reliable supply of electricity for 24 hours a day needs to become a reality for the whole country including rural areas. Enough generating capacity need to be created to outgrow the situation of energy and peaking shortages and make the country free of power cuts with some spare generating capacity so that the system is also reliable. The power sector is to be made financially healthy so that the State Government finances are not burdened by the losses of this sector. The sector should be able to attract funds from the capital markets without Government support. The consumer is paramount and he should be served well with good quality of electricity at reasonable rates. Primary perception survey at NTPC: In view of above, it is imperative that there is a huge challenge before the Indian power sector and the only way to fulfill the country’s ambitious growth targets is to radically improve the performance of



the entire power sector as a whole. Every constituent company needs to have a self-assessment and chalk out its own roadmap to grow and perform radically. NTPC being the largest power generating company of the country naturally is expected to take the lead. To just have an assessment of the current status of NTPC to undertake radical innovations, we have carried out a primary perception survey at NTPC. Methodology & Questionnaire : For this survey a questionnaire categorized in three parts, was sent by E–mail to randomly selected 3000 executives of the different projects/offices of NTPC. We have received total 487 responses. The Part-wise analysis and results of the survey are indicated below: PART A: Organizational Strategies that Impact Innovation Management Questionnaire Part-A: This section is designed to specify your organization's approach to innovation. On a scale from one to five ("not at all" to "consistently and effectively") please rank the extent to which your organization has done the following 1 - Not at all 2 - Minimally 3-Somewhat 4- Mostly 5-Consistently & effectively



S. No.

Questionnaire

Please tick one option

1 2 3 4 5

1 Our organization has moved beyond hit-and-miss innovation to a more strategic approach that is aligned with our growth strategies.

2 Our organization has fostered a culture that expects everyone, at every level, to contribute to the innovation process

3 Our organization has built networks, pathways and platforms that promote the flow of innovation both internally and externally through alliances and partnerships.

4 Our organization has adopted/adapted a step-by step funnel process that facilitates idea generation/collection right through the development of a business case and deployment of the new product/service/process

5 Our organization has created opportunities to learn by building systems that capture key learning’s from the innovation process and communicate these learning’s across the entire enterprise

6 Our organization spends most of its innovation effort (check one):



Responding/Reacting to Change Anticipating the need to Change Experimenting with Change Envisioning Change

7 Our organization consistently tracks the benefits realized from innovative activity by measuring (check all that apply):

Value creation in products/services Brand loyalty Customer satisfaction Employee performance Bottom line



Analysis & Results – Part-A:

Organizational strategies that impact innovation management

3.12

3.21

3.25

3.46

3.52

2.5 2.7 2.9 3.1 3.3 3.5 3.7

Strategicapproach

Innovationculture

Alliances andpartnerships

Idea generation

Learningsystems

Our organization spends most of its innovation effort

28%

14%15%

43%

Reacting

Anticipating

Experimenting

Envisioning



Our organization consistently tracks the benefits realized from innovative activity by measuring

37%

13%19%

8%

23%

Employee performance

Bottom line

Brand loyalty

Customer satisfaction

Value creation

PARTB: Leadership Competencies that Drive Innovation: Questionnaire Part-B: The following set of leadership competencies (competencies named in brackets) grew from research in the area of leadership and innovation. On a scale from one to five ("not at all" to "consistently and effectively") please rank the extent to which you demonstrate the following behaviors. 1 - Not at all 2 - Minimally 3-Somewhat 4- Mostly 5-Consistently & effectively

S. No.

Questionnaire

Please tick one option

1 2 3 4 5

1 (Visionary Leadership) I take the mystery out of innovation by defining it. As a leader, I have lead our



team through a process to define what innovation really means inside our organization/business unit. We've developed a clear, concise definition of innovation based on our organizational culture and internal/external parameters.

2 (Aligning for Success) I link innovation to our business goals. As a leader, I've positioned innovation within my business unit/department, as an integrated aspect of our organization's overall success--not as a gimmick. We have created an Innovation Model that ties our business strategies into the day to day innovative process.

3 (Strategic Decision Making) I define challenges specifically. As a leader, I have targeted important challenges that require innovative solutions. I have prioritized these areas and I've allocated resources to ensure implementation

4 (Continuous Learning) I maximize opportunities to learn. As a leader, I consider it important to learn from mistakes, and have created supportive ways of handling initiatives that have failed. I've put into place systems and procedures to follow through on mistakes by looking for learning opportunities

5 (Building a Team that Thinks Effectively) I discover how individuals think they are most creative. As a leader, I have assessed how each of my team members is creative



and how this strength benefits our team and our organization.

6 (Coaching/Facilitation) I take deliberate, observable steps to enhance creativity. As a leader, I've introduced models for thinking, tools that foster innovation, and techniques/training to enhance our team's ability to build thinking skills.

7 (Influence) I set an example. I've taken responsibility to enhance my own creative skills/behavior by integrating specific actions into my overall development plan. Components of this plan may include: how-to actions for ways I can model innovation, ways to set a tone through my behavior/attitude, and strategies to show people that I support their attempts to innovate

8 (Communication) I encourage active communications. As a leader, I've created an environment of mutual support among co-workers. I've facilitated discussion across the organization by helping to set up effective lines of communications no only in our own team, but also among other departments/divisions.

9 (Planning and Organizing) I facilitate action. As a leader, I've set up systems for our teams to take action on converting creative ideas into specific innovative changes.



Analysis & Results – part-B: Leadership competencies that drive innovations

3.62

3.55

3.3

3.68

3.53

3.51

3.52

3.54

3.5

2.5 2.7 2.9 3.1 3.3 3.5 3.7 3.9

VisionaryLeadership

Aligning for Success

Strategic DecisionMaking

Continuous learning

Team building

Coaching/Facilitation

Role modeling

Communication

Planning andOrganizing

PART C: Resource Allocation and its Impact on Innovation Success: Questionnaire Part-C: This section is designed to assess how your organization is allocating resources in relation to your innovation strategies. Please answer "yes" or "no" depending on which of the following procedures are part of your organization's existing budgeting process. S. N

Questionnaire Yes No



o. 1 As an organization, we have put

resource muscle behind our innovation framework by allocating development dollars to fund fledgling ideas through the deployment of the final outcome.

2 As an organization, we have mandated that a certain percent of an individual's work time is dedicated to informal idea generation, exploratory thinking, and experimentation. If yes, please specify how much time you allocate.

3 As an organization, we have allocated funds to adapt the physical workplace environment/structure to enhance the generation and flow of ideas.

4 As an organization, we have allocated funds for performance improvement programs and tools that build the capabilities of individuals/teams/leaders to utilize their innovative potential and perform to their fullest.

5 As an organization, we have allocated funds to create a dynamic, knowledge-based learning system for communicating learning across the organization.

6 As an organization, we have allocated funds to reward and recognize innovative outcomes on the part of individuals and teams.



7 As an organization, we effectively adjust and reallocate people's workloads to accommodate tasks related to innovative initiatives

Analysis and Results Part-C: Resource allocation and its impact on innovation success Sl. No

Questionnaire

1 As an organization, we have put resource muscle behind our innovation framework by allocating development dollars to fund fledgling ideas through the deployment of the final outcome.

71.3%

28.7%

2 As an organization, we have mandated that a certain percent of an individual's work time is dedicated to informal idea generation, exploratory thinking, and experimentation. If yes, please specify how much time you allocate.

89.5%10.5%

Yes NoResponse



3 As an organization, we have allocated funds to adapt the physical workplace environment/structure to enhance the generation and flow of ideas.

61.3%

38.7%

4 As an organization, we have allocated funds for performance improvement programs and tools that build the capabilities of individuals/teams/leaders to utilize their innovative potential and perform to their fullest.

39.3%

60.7%

5 As an organization, we have allocated funds to create a dynamic, knowledge-based learning system for communicating learning across the organization.

41.4% 58.7%



6 As an organization, we have allocated funds to reward and recognize innovative outcomes on the part of individuals and teams.

27.8%

72.2%

7 As an organization, we effectively adjust and reallocate people's workloads to accommodate tasks related to innovative initiatives

77.6%22.5%



Overall analysis & Result:

Comparision of the 3 key indices for innovation management

66.24

70.55

48.55

0 20 40 60 80

Strategies

Leadership competencies

Resource allocation

Percentage

Overall Innovation Management

Index

61.78

0 10 20 30 40 50 60 70



Resource allocation for innovation o Creation of NTPC

Innovation Center: Cross Functional Format Separate Budget

Institutionalizing

Innovation Sense of Ownership Experimentation Speedy Execution

Improve Strategic decision making o Enhancing

ownership: Develop leaders as

entrepreneurs Introduce ESOP

instead of cash incentives

Empowerment

Strategic approach Vertical integration &

diversification: Coal-mining & washeries, gas exploration, Nuclear power, Distributed generation, Power trading

Globalization : focus on strength of NTPC’s O&M experiences

Search for new markets and customers

Acquisition and Turnaround of low performing plants

Innovation culture o Revolutionizing

individual Performance through:

Separate KPA for innovation

Introduction of innovation incentive

Chairman’s award for innovation

Recommendations based on the survey findings:

Based on the primary perception survey conducted by us, following strengths and improvement-opportunities emerge for NTPC’s innovation management for radical performance improvement: Following is the proposed action plan for addressing the opportunities for improvement:

Action plan to address the

opportunities for improvement

NTPC

Innovation Management

NTPC

Strengths: Learning systems

Idea Generation Rewards & recognition system

Visionary leadership

Opportunities for Improvement: Strategic approach Innovation culture Strategic decision making

Resource allocation for innovation



Recommendations: Based on the study and findings of primary and secondary surveys in this paper, following workable recommendations are made which could go a long way in radical performance improvement of an organization:

To successfully grow, a company must align its strategy, organization and people processes.

A proper blend of acquisition, organic growth and strategic alliances may be resorted to radically enhance the business performance.

Superior performance is associated with early introduction of many and new products.

Proactive approaches like vertical integration are key to radical performance improvement.

A company must do internal investment in innovation and new product/service development, new business creation, and external venture investing in new technologies and emerging markets However this should be associated with a continuous effort to improve organizational climate and productivity of the core business

Internet based knowledge management system should be established and made accessible to all employees.

To achieve sustained superior performance ,a company should open its organization and its people to the invigorating force of continuous learning process



Conclusion: As the marketplace changes and evolves, the task of delivering outstanding performance has become more complex. Increasingly, it involves the design of management structures and control systems that drive strategic change, capitalize on new opportunities, and minimize risk—all without hindering the company's flexibility and creativity. No longer is it enough for top executives with responsibility for financial performance and competitive positioning to explain past results. They must understand how to bring out radical performance improvement. Organic growth from current operations and incremental innovation is not sufficient for survival in the long term. Similarly, traditional markets and technologies are not sufficient to ensure acceptable growth rates. Therefore, new sources of revenue must be developed. Notwithstanding companies like 3M, HP, P&G etc. often seen as the most innovative companies, most companies don’t have formal processes for ensuring radical innovation. The Indian economy has been unshackled and a new vision of India as a major player in the global setting is getting crystallized. Globalization and technological advances have gifted India the competitive advantage to position itself as a low cost and reliable source of goods and services. India can continue to use these advantages to maintain the current growth trajectory for quite sometime. But, in order to ensure that these natural advantages don’t dilute away over time, the Indian companies need to shun their complacency of achieving a “satisfactory” underperformance and focus more on radical improvement in business performance to match the global benchmarks. A better and long term approach should be adopted to build a national capacity for innovation. Building this capacity is a long and arduous task that can be accomplished with the



commitment and dedication of all the stakeholders. This will generate long term and sustainable value to command global leadership. “You cannot manage from the present to the future – that will inevitably lend you in to the trap of incrementalism. You will have to manage the present from the future – that is the path and the process for radical improvement.” References:

1. Sumantra Ghoshal, Gita Piramal, Christopher A. Bartlett, Managing Radical Change, Penguin Books

2. S. J. Phansalkar, Opportunities and strategies for Indian Business, Response Books

3. Richard Leifer, Christopher M. McDermott, Gina Colarelli O’Connor, Lois S. Peters, Mark P. Rice, Robert W. Veryzer, Radical Innovation, Harvard Business school Press, Boston, Massachusetts

4. www.thegff.com 5. www.1000ventures.com 6. www.success360.com 7. www. lallyschool.rpi.edu



Q4E-2005

Ist Runners -up : Y K Sehgal Subir Sen V Thiagrajan

Organisation : POWERGRID - Corporate, Engg. Deptt.

Title : Radical Performance Improvement – A Roadmap Through Technology Innovation

Q4E - 2005 POWER HR FORUM


ABSTRACT Ensuring a secure electricity supply at an affordable price is an important policy objective in virtually all modern economies. There are limited possibilities for replacing electricity by other forms of energy. To ensure rapid growth of economy the performance of electricity sector needs to be improved continuously. In this paper a road map for Radical Performance Improvement of transmission segment of Electricity sector through technology innovation is presented. The proposed model is validated through case studies. The similar model is applicable for Radical Performance Improvement in any organization. INTRODUCTION Indian economy is growing at 7-8% of GDP. Electricity being the key input for economic growth, matching development of all segments of power sector viz. Generation, Transmission and Distribution is required. It is estimated that demand of power would increase multifold, from present level of about 88,000 MW to about 218,000 MW in next 12 years i.e. by 2017 [1]. Blue print drawn for power sector development by the Govt of India, envisages capacity addition of about 100,000 MW by the end of 2012, which shall be further enhanced by about 67,000 MW during 12th Plan period (2012-17) [2]. The targets to be accomplished in next 10-12 years are almost equivalent to the development Indian Power sector has witnessed in the last five (5) decades. This calls for huge capital expenditure/investment, impact on environment, which may leads to increase cost of delivered power. Hence, performance of each segment needs to be improved radically to ensure optimal development of electricity sector. Transmission system plays the central role for development



of secured and efficient electricity market by transferring/trading of power from generators/supply side to bulk consumption centers.

Further to accelerate the growth of Indian Power Sector, Electricity Act 2003 [3] has been enacted which provides open access in transmission, bring competitive open electricity market etc. Many initiatives have been taken to improve the performance of transmission sector as well as other segments of power sector. However, performance improvement is a continuous process, hence there is always scope for further improvement.

In this paper, considering the importance of transmission sector in the over all growth of the Nation, a road map for radical Performance Improvement of transmission system through technology innovations has been proposed. The paper also presents expected benefits through the proposed performance improvement models. The road map further validated by the R&D trends worldwide.

VISION OF POWER DELIVERY SYSTEM AND ELECTRICITY MARKET An efficient power delivery system and electricity market shall enable achievement of the following goals.

• “Power to all” at affordable price for sustainable growth • Extremely reliable delivery of high quality “digital-

grade” power needed by a growing number of electricity end uses [4]

• Availability of a wide range of “always-on, price-smart” electricity that stimulate the economy and offer consumers greater control over energy expanses



• Minimum environmental and societal impact by increased use of existing infrastructure.

• Development of transmission systems with self healing features that automatically anticipates and quickly respond to disturbances to minimize their impact.

• Improve productivity growth rates, increased economy growth rates.

To achieve above vision of the future power delivery system and electricity markets, accelerated research, design and development, investment and careful policy analysis would be required. Technology innovation in electricity sector is a corner stone of global economic stone. Towards this a road map for radical performance improvement of transmission system through technology innovation has been proposed. PROPOSED ROAD MAP “Gold plating”, the present power delivery system (e.g. simply poring more money into the power delivery system in the form of duplicative or redundant facilities) is not a feasible way to improve the performance upto desired level. Meeting the energy requirements of society will require the application of technologies to move towards realizing the vision of power delivery infrastructure and electricity markets. Keeping above in view following aspects have been considered for Radical Performance Improvement of transmission system • Reduction in Cost of delivered power • Minimization of Environmental impact • Optimization of investment



• Increase in volume of energy trading

Detailed studies and research carried out in the above direction to improve the performance of transmission system radically and a road map has been proposed which is categorized into three roads.

Road - 1: Integrated Resource Planning – to optimize cost of transmission

Road - 2: Transmission Line Design Innovation – to

optimize cost of transmission and reduce impact on environment

Road - 3: Real Time Monitoring of Ambient Condition –

facilitate increased volume of power trading and delivery of low cost power to consumers

In the following paragraphs description of each road in realizing the vision and its benefits are discussed. ROAD - 1: INTEGRATED RESOURCE PLANNING

Present Planning Practice : The primary energy resources in the country i.e. coal and hydro potential are unevenly dispersed and confined to certain pockets only at remote locations far off from the widely spread load centers as shown in Fig-1.



About 90% of the coal reserve lies in the States of Jharkhand, Orissa, Chhattisgarh. A large hydro potential of about 84,000MW (out of which about 65,000MW yet to be exploited) are concentrated in the States of Arunachal Pradesh, J&K and Himachal Pradesh [5]. Studies reveal that development of large size power stations at the resource head and transfer of electricity

ChennaiSouth Madras

NEPAL

SRI LANKA

Cuddalore

Krishnapatnam

Korba

Vindhyachal

Talcher/Ib Valley

Partabpur

Kudankulam

Ennore

Indore Bhopal

Kozhikode

Thiruvananthapuram

Mangalore

Kayamkulam

Pipavav

COLOMBO

Hyderabad

Bangalore

SRKaiga

MumbaiTarapur

WRRaipur

Gandhinagar

Ludhiana

Jammu

DelhiNRJaipur

RAPPLucknow

Kolkata

Bhubaneswar

SimhadriVizag

GuwahatiNERCHICKEN

SIKKIM

PatnaER

NECK

BANGLADESH

BHUTAN

MYA

NM

MAR

Fig-1: Generation potential Map in India



to distantly located demand centers is much cheaper and environmental friendly option than transportation of fuel for setting up power station near load centers. Hence there is a need to develop high capacity long distance transmission system. Generation projects are usually being developed in different phases requiring phased development of transmission capacity. Further to optimize the cost/MW of power transfer it is necessary to priorities the development of generation complex for which high capacity transmission corridor has already been established.

For example in Uttaranchal Tehri-Meerut 2x S/c 765kV lines is being developed for evacuation of power from Tehri – I&II ( 2000MW), Koteshwar (400MW), Lohari Nagpala ( 600 MW) and Palamaneri (416MW) in Bagirath basin. By 2010, it is expected that 3000 MW, Tehri–I&II (2000MW), Koteshwar (400MW) and Lohari Nagpala ( 600 MW), would be commissioned, and Tehri-Meerut lines would be charged at 765kV and can carry additional 500 MW. In Uttaranchal, Tapovan Vishnugarh hydro power plant in Alaknanda basin is also under active consideration. For evacuation of power from this plant a transmission system of Rs. 500 crs would be required while power from Palamaneri generation project can be evacuated at minimal investment over Tehri-Meerut lines. The tentative commissioning schedule of Palamaneri generation project is about two years after Tapovan generation project. If by proper prioritizing, Palamaneri generation is taken before Tapovan generation it would result in deferred capital expenditure by two year and substantial saving. Proposed Road Map

To ensure Radical Performance Improvement the need of the hour is to shift from prevailing Segmented concept of generation and



transmission system planning to Integrated Resource Planning approach in which both the cost of generation and cost of establishment of transmission needs to be considered while prioritizing the generation. The flow chart of proposed Integrated Resource Planning model is shown in Fig-2.

Fig -2: Proposed flow diagram of Integrated Resource planning Model

Benefits Studies have been carried out to assess the benefits with the implementation of integrated resource planning in generation as well as transmission network development, with specific reference development of hydro projects in Bagirath and Alaknanda Basins.The schematic the transmission system considered for analysis is shown in Fig-3

Choosing the Economic Option

Identification of generation potential of certain areas

Evolving Bulk power transmission plan

Phasing of transmission system as per the power transfer requirement

Determine of composite Cost/MW of Generation + transmission



As discussed earlier high capacity 765kV transmission line is being developed between Bagirath basin and Load centers like Meerut , Muzzaffarnagar, Roorkee etc for transfer of power of the order 3500 MW. However generation capacity of about 3000 MW is being developed progressively in Baigrath basin leaving behind at least 500 MW capacity margin in the transmission corridor. In the similar time frame a new generation project is proposed to be developed at Tapovan in Alaknanda Basin for which additional transmission system need to be established. Implementation of the proposed model through development of Bagirath basin followed by Alaknanda basin would result in deferment of capital expenditure of about Rs 500 Crs towards establishment of new transmission facility and thereby saving in transmission tariff of

Fig - 3: Development of Hydro Potential in Uttranchal

BHAGIRATHI BASIN

MORADABAD

ROORKEE

MURADNAGAR

MUZAFFARNAGAR

DA

DR

I

MA

ND

AU

LA

MEERUT

RISHIKESH

PALAMANERI

(400MW)

LUCKNOW

BEARILLY

(416MW) (400MW)V PRAYAG

ALAKNANDA BASIN(600MW)

LOHARI NAGPALTEHRI-II (1000MW)TEHRI-I (1000MW)

KOTESHWAR

TAPOVAN

(520MW)VISHNUGAD

KASHIPUR

AGRA



the order of Rs 70 Crs/annum. This would be a Radical performance Improvement.

ROAD– 2: TRANSMISSION LINE DESIGN INNOVATION The power transfer capacity of transmission infrastructure is dictated by following three aspects:

a) Thermal Limit: Thermal limit indicates the designed limit of

the transmission capacity. The factors determining thermal limit are number of conductors, conductor size, designed temperature, voltage class and environment factors etc.

b) Angular stability limit: A dynamic stability limit which depends upon length of line, line parameters, etc. For small lines angular stability is higher than thermal limit however within increase in length the loading limit drops.

c) Surge impedance loading: It is the loading at which MVAR

generated by line is equivalent to the MVAR absorption in the line. Surge impedance of the line is dependent on line parameters. Surge impedance loading of the line is fixed and is independent of the line length and is much lower than Thermal rating.

The power that can be transmitted over a long Extra high voltage transmission line is limited by the lowest of the above three limits i.e. Surge Impedance Loading (SIL) as shown in Fig-4. Transfer of power more than SIL would require construction of additional transmission line which is not only capital intensive but also has serious impact on environment (utilization of more Right-of-Way) and social aspects. This concept is depicted in Fig-5.



0

1000

2000

3000

4000

5000

50 100 150 200 250 300 350 400 Length of Line

Line Capacity (MW)

Angular stability

SIL

Thermal limit

Fig - 4: Transmission Line Capacity

Fig -5: Impact of more Transmission line on environment



Proposed Road Map Transmission line is characterized by its Resistance (R), Inductance (L) and Capacitance (C) as shown in Fig-6 below. The Surge Impedance Loading of the line in inversely proportional to its inductance and directly proportional to capacitance which is described by Eq.-1.

………... (1)

Fig -6: Transmission line Characteristics

The Inductance and Capacitance of the transmission line depends upon

No. of sub-conductor in a bundle Conductor diameter Tower configuration

Spacing between sub-conductors within bundle Spacing between phases

CLVSIL

/2

=



The Surge Impedance Loading of the transmission line may be enhanced upto its thermal limit by decreasing the Inductance and/or increasing the Capacitance. This can be achieved by reducing the space between phases as well as increasing the separation of sub-conductors in a bundle with minor modification in transmission line design at marginal cost.

Studies have been carried with different tower configurations and conductor spacings. It has been observed that with the reduction in phase separation by about 4m and increase in bundle conductor spacing by 0.5m SIL has enhanced by about 20% i.e. from 515MW to 620MW without demanding additional Right of Way.

Benefits : An increase of power transfer capacity by about 100MW, if utilized for even four(4) hours in a day would result in -

Increased power delivery of 400,000 units/day No additional ROW & defer capital expenditures of

about Rs.200 Crs. Benefit to the Nation – at least worth Rs.80 Lacs/day

This would be the Radical Performance Improvement in the transmission system.

ROAD - 3: REAL TIME MONITORING OF AMBIENT CONDITION Natural “uncontrolled” power flow on long transmission line normally results in less than full utilization of available transmission capacity. When line loading is increased, the conductor heated up and the real limiting factor, to maintain a safe clearance between the energized line and the ground (line sag), arises. The amount of sag for a given loading is directly dependent



on the ambient conditions like temperature, wind speed, solar coefficients etc.

Conventionally, a deterministic approach is followed for limiting the maximum permissible loadability, based on the assumptions of a particular ambient condition. However, field conditions vary from time-to-time, day-to-day as well as season-to- season and allow margin for increased loadability of the line. For example a line designed for conductor maximum temperature of 750 C with ambient temperature of 450 C can be loaded to about 850MVA [6]. But if the ambient temperature is less, in winter/night conditions, say 350 C the loading can be increased by about 20%. The typical variation of line loadability with temperature is depicted below in Fig-7.

Ambient Temperature Load ability

Fig -7: Line loading vs Ambient temperature

0 200 400 600 800

1000 1200 1400

20 25 30 35 38 40 42 44 45



Proposed Road Map : To increase the line loadability, it is proposed to monitor the ambient conditions around the transmission system on real time basis and send the data to the system operator/dispatcher to evaluate the line rating as well as declaration of capacity available for energy trading. The arrangement is depicted in Fig - 8 below

The ambient conditions may be monitored by placing sensing devices and transmitted to Load dispatch centers where the information can be processed on real time basis to find out the margins available for increased loading. A

Fig -8: Ambient temperature measurement of Line



typical communication arrangement in this regard is shown below in Fig - 9.

Benefits An increased loadability by about 150MW due to favorable ambient conditions (450 C to 350 C) would result in -

Increased Energy Trading of 300,000 units/day (assuming 2hrs additional utilization) – equivalent to setting up of power plant of 200MW capacity

Defer investment of about Rs. 800 Crs.

Transmission Line

Substation

Existing substation

Receiver

Control Centre

Sensors

Fig -9: System for the monitoring of Ambient



Net saving on account of cheaper cost of generation - Rs. 5.5 Crs per annum

Opportunity cost availed by consumers – worth Rs. 55 Crs/annum

R&D TRENDS WORLD WIDE The above road map further validated by R&D trends world wide. In US and other developed countries are considering adoption of Integrated Resource Planning Model to improve the performance of Electricity Market [7]. Further, consequent upon number of Grid Disturbances occurred across the globe [8] calls for establishment of new transmission capacity on priority basis [9]. However establishment of new transmission capacity is not only capital intensive but requires large implementation time as well as considerable impact on environmental and social aspects. To take care of above aspects world wide R&D efforts are being made to utilize the existing transmission capacity to the maximum extent possible through innovation of technologies like modification in transmission line design, Real time monitoring of ambient conditions etc.

Therefore learning from the proposed Road map for Radical Performance Improvement in transmission sector across the globe, similar concept can be adopted for Radical Performance Improvement in any organization which consists of three roads

Integrated Resource Planning Value Chain Innovation Key equipment productivity Multiplication



CONCLUSION Electricity is the key input in the growth of economy of a Nation. Performance of each segment i.e. Generation, Transmission and Distribution needs to be improved radically to ensure optimal development of electricity sector. Considering the central role of transmission for development of effient electricity market a road map comprising three roads for Radical Performance Improvement of transmission sector has been studied and proposed. The remarkable benefits from implementation of the proposed roads are tabulated below.

Roads Impact

Road-1 : Integrated Resource Planning

Generation capacity prioritization - 500MW, Impact

• Capital Cost deferred: Rs 500 Crs

• Annual Tariff saving : Rs 70 Crs /annum

Road-2 : Line Design Innovation

• Increased power delivery of 400,000 units/day (100MW)

• No additional ROW & defer capital expenditure of about Rs. 200 Crs.

• Benefit to the Consumers – at least worth Rs.80 Lacs



Road-3 : Real time monitoring of ambient condition

• Increased Energy Trading of 300,000 units/day (150MW)– equivalent to setting up of power plant of 200MW capacity

• Defer investment of about Rs. 800 Crs.

• Net saving on account of cheaper cost of generation - Rs. 5.5 Crs per annum

• Opportunity cost availed by consumers – worth Rs. 55 Crs.

The road map is an iterative process that requires consistent attention and refinement as the system grows.



REFERENCES 1. 16th Electric Power Survey, CEA, Sep 2000 2. Power India Year Book, ASSOCHAM, 2001-02, 3. Electricity Act 2003 4. Power Delivery System and Electricity Markets for the future,

EPRI, USA, Sep 2002 5. 50,000 MW Hydro Electric initiative, Govt of India, May 2003 6. Manual on Transmission Planning Criteria, CEA, June, 1994 7. Department of Energy, US web site, (www.eh.doe.gov) 8. US-Canada Power System Outage Task Force Report, USA,

April 2004 9. Security of supply in Electricity Markets, International Energy

Agency, 2002 ACKNOWLEDGEMENT Authors are thankful to the POWERGRID management for granting permission for presentation of the paper. Views expressed in the paper are of the authors only and need not necessarily be that of management of POWERGRID.



Q4E -2005 2nd Runners -up : N S Thakur A K Dang A K Chaturvedi

Organisation : NTPC Ltd. - Dadri

Title : Road for Radical Performance Improvement



ABSTRACT

With the globalization of world economy, it is imperative for Indian Companies to become World Class in performance. To compete in the global market companies have to match or exceed the performance of benchmark organization at World level. This will require Radical Improvement in Performance of Indian companies more so, in the Power Sector, due to its peculiar characteristics. NTPC as a leading Indian Company has to set example for others towards Radical Performance improvement. NTPC is a very successful company whose performance is admired globally. Is radical performance improvement possible for a company already doing exceedingly well? Our analysis shows that there are areas where this is possible with implementation of new ideas with high goal set by top management and whole hearted support of motivated staff. Radical Performance Improvement is possible in each of the four levels of Organization (O), Resource (R), Technology (T) and Market (M). Many suggestions came out during brainstorming sessions organized to generate ideas. Thereafter focused group discussion and personal interviews were conducted to further refine the ideas. After detail analysis it was observed that some of the ideas, if implemented sincerely can result in break through performance improvement. There is unutilized capacity of 5500 MW in Nuclear power, which NTPC can tap profitably on its strength of balance sheet and strong project management capabilities. Locating new plants in coastal regions will protect the company from the total dependence on domestic coal and help the running of all plant in



the scenario of projected coal shortage in near future. Hydro power is one area where large capacity addition is possible, which will improve company’s profit dramatically in future Electricity market. On the technology and environment front there is opportunity in Hydrogen powered plants. In new business processes, forming of JVs for R&M of SEB plants and transformational outsourcing of IT and overhauling maintenance is proposed. Human Resource is the most important of all the resources and in capital and technology intensive power industry proper skill development is very important. It has been shown that with the suggested system of skill development and knowledge management, it is possible to improve the performance of the organization radically. It is seen that any change bringing Radical Performance Improvement is not a one off activity, but it is learning-oriented evolutionary effort. Any break-through improvement can be brought only with the simultaneous effort of top management in framing strategy, staff in working tirelessly to achieve the target and change of core processes wherever required. INTRODUCTION: The importance of quality power has been most aptly described by our President A.P.J. Abdul Kalam in his book Vision 2020 in following words “No nation can aspire to be modern and developed without the availability of quality power for all. No modern machinery can run without uninterrupted and Quality Power systems. The whole magic wand of Information Technology (IT) will be at naught if there is not electric power. Imagine New York or London or Tokyo having just one day



without power or a week of interrupted power supply. It just cannot happen. If it did, it could bring down the government. When we look at the power situation in India, ‘depressing’ or ‘gloomy’ appear to be mild words to describe it”. At the time of independence India’s total installed capacity was about 1300 MW. A tenfold increase in five decades has resulted in the present installed power generation capacity of about 118419 MW. But is it enough or adequate? In the 1950s India and China had roughly the same installed power capacity. Now China has about three times more installed capacity than India. Further, China has been consistently adding a capacity of about 15000 MW a year whereas our capacity is growing at a rate of 2500 MW per year. India is facing 8% energy demand and 13% peak shortfall. For the GDP growth of 8%, the generating capacity needs to grow at the rate of minimum 10% which is approx 10,000 MW per year. NTPC, with installed capacity of 23749 MW contributes 26.7% of the nation’s power generation with only 19.1% of India’s total installed capacity. Driven by its vision to lead, it has charted out an ambition growth plan of becoming a 56,000 MW plus company by 2017. The target is being further increased to 66000 MW. NTPC has to play major role in future growth of Power Sector in India. From 1975 to 2005 NTPC had added 23,000 MW i.e. approx 1000 MW/year and if it targeting 66000 MW by 2017, it means NTPC has to add approx. 3500 MW/year which is much more than the present rate. The operational performance also needs to be improved at the level of global benchmarks. This is a



very challenging target, which will not be easy unless Radical Improvement in Performance is attempted and achieved.

How we went ahead…

Primary Source

Brain Storming Focused Group

Discussions Personal Interview

Our Understanding on

Radical

Performance Improvement

Findings for Radical Performance Improvement

ANALYSIS OF FINDINGS

ROAD MAP

CONCLUSION

Inference

(NTPC as Prime Focus in Power Sector)

Secondary Source

Inputs from CII, CEA, platts Power, Power

Line, NTPC Corporate Plan, Disha Team

Recom., etc



RADICAL PERFORMANCE IMPROVEMENT: The word “Radical” is derived from the Latin word radix

meaning “root” i.e improving the things by getting to the roots.

Radical Performance Improvement is sum total of Radical

redesign of business processes to achieve dramatic

improvements in critical, contemporary measures of

performance.

For bringing Radical Improvement Performance the top

management has to believe that Radical performance

Improvement is possible even when one is already very successful

(as the case with NTPC). The experience of General Electric over

the last twenty five years proves the same. Jack Welch, took over

the helm of GE in 1981, which was already very successful. He

was able to raise the market capitalization from $11 billion to

more than $ 450 billion by 2001.



Fig 1 : Balancing Operation and Strategy

• Portfolio choice ( eliminating low-return activities)

• Growth opportunities ( new products and markets; expanding share)

• Improving labour productivity ( revenues and profits per employee)

• Building competencies (new capabilities and resources)

• Improving operating efficiency ( sped, reducing waste)

• Organizational capabilities ( revitalizing organization and people )

• Improving capital productivity

( ROCE )

RADICAL PERFORMANCE IMPROVEMENT

IMPROVING RESOURCE

PRODUCTIVITY (OPERATION : SOUR)

CREATING AND

EXPLOTING NEW OPPORTUNITIES

(STRATEGY : SWEET)



The requirement of radical performance improvement is two fold : improving Operational Performance and Strategic Growth. The best managed companies manage these two forces delicately to provide high growth with continuous improvement in productivity as shown in Figure 1. Another prerequisite of sustained improvement is profitable growth, which generates cash helping companies to restructure debt and finance growth from internal accruals. Reduced debt makes the companies attractive to the investors and provide the management strategic freedom. The reduced cost of capital again generates profitable growth (Fig 2).

The Virtuous Spiral of Profitable Growth

Fig: 2

Increase ability to support growth Investment

potential Strategic

Freedom

Generate Internal cash for Growth ( D/E)

Increased Attractiveness to investors ( Share Price D/E WACC )

Increased financial degree of freedom

( Lower cost of capital)

Grow Profitably ( ROCE / WACC



To become competitive, companies will need to think about strategy and competition at four very different levels (see Fig 3). The performance at each level both influences and is influenced by performance at the other stages. To win, companies will have to win at each stage: Organization (O) , Resources (R), Technology (T) and Market (M). It is worth remembering that level of uncertainties are very high for radical improvement. RESEARCH METHODOLOGY: DATA COLLECTION: (a) Primary Source – The Primary data was collected with the

following:


Technical Uncertainty

Market Uncertainty

Organization Uncertainty

Resource Uncertainty

LOW

HI

Incremental Performance Improvement

FFiigg 33 ::FFOOUURR CCAATTEEGGOORRIIEESS OOFF UUNNCCEERRTTAAIINNTTYY



• Through several Brainstorming sessions with all level of executives and by obtaining written feed back from them.

• Focused Group Discussions • Personal Interviews

(b) Secondary Sources – Data from CII Report- IDEA, platts Power, CEA Reports, NTPC Corporate Planning, Disha Team Recommendations, Literature and Websites.

(c ) Scope of Study – Data collection by keeping NTPC and its

activities as prime focus in Power Sector. PRIMARY RESEARCH: Brainstorming Session – Five brainstorming session were conducted by forming different groups of employees of Dadri plant. Among the various level of Employees, representative number of employees were called for Brainstorming sessions as per following table:

SL. Level of Employees

No. of Employees

% of Representative sample called for Brainstorming Session

1. E1-E4 205 25%

2. E5-E6 174 30%

3. E7 & above (HOD’s)

32 100%

4. Executive Trainees who have joined NTPC in

40 100%



Aug’05

5. Non- Executives

718 10%

Sampling was done on the basis of functional division of employees in each level. The details of no. of employees called for Brainstorming Sessions, no. of employees attended Brainstorming Session is depicted in following Graph: During the Brainstorming Session, first all participants were sensitized and stimulated about the objectives of Brainstorming Session and concept of “Radical Performance Improvement” . After the long deliberations they were asked to jot down their ideas and suggestions in four categories of Organization, Resources, Technology and Market. We have also developed a

52

52

45

32 26

72

3 40

E1 – E5 E6 – E7 E7 & above Exec. Non Exec. (HOD’s) Trainess

40

40

72

34



format for the same (Sample copy of format is enclosed in Annexure). The various ideas generated are given below:

IDEAS / SUGGESTIONS NO. OF RESPONDENT

Organization : • Global Presence:

Global Market Global Fuel Joint Venture

• New Vision • Standardization of Major Equipments

for new Project and Provision of Rate Contract for spares

• More Emphasis on Coastal Power Stations

• Accelerated Rural Electrification Programme

• Transformational Outsourcing

23 26 25 22 21

58

23

49

Resource : • Best talent hunt for new comers • Regional Overhauling Groups

(Shared Maintenance) • Pooling of common accessories • Going for new gas finds. • Exploiting unutilized hydro capacities • Backward integrations for Oil

through joint ventures • Revamping of Training &

Development Process • Skill Development & Knowledge

Management

29 12

18 53 54 29

15

17 51



Technology: • Interlinking of all the station of NTPC

through Web-site. • Capacity Enhancement of Existing

Coal Stations. • Going for Nuclear option in a big way • Clean Coal Technologies by using

IGCC etc. • Development of Hydrogen fuel

technologies

30

27

56

17

48

Market : • Pooled Tariff on Regional or NTPC

level • Forward Integration into transmission

and distribution • Searching for Bulk consumers • R&M of old SEB Stations by Strategic

Alliance on profit sharing • Value added options for Ash

Utilization • Joint Ventures with Cement Industry

for ash utilization

31

23

34 57

34

25

Note : The suggestions for which the no. of respondents were less than 10, have not been incorporated. Focused Group Interaction and Individual Interviews : In order to develop deeper insights, pros & cons of selected options and for developing the Road Map we have conducted Focused Group & Personal Interaction with following: Group Interaction :

• Energy and Efficiency Management Group • Fuel Management Group



• Planning and System Cell Personal Interaction :

• GM Dadri • AGM O&M Thermal • AGM (Gas) • DGM (F&A) • DGM (IT)

SECONDARY RESEARCH AND LITERATURE SURVEY :

The basic idea for carrying out secondary research was to identify areas of Radical Improvement in performance parameters by studying the world best plants. As per platts Power July / August’2004 and Sept’2004 Issue six out of twelve top plants and also Top of Top Plant is from U.S. The only Indian plant to figure in this list is Dhanu Thermal Power Stations of Reliance Energy. As per Power Line July’2005 Issue, in 10 Best performing power stations in India (2004-2005). Dhanu tops the List and NTPC Dadri Plant is at No.# 3. All the slots from 3 to 10 except No.# 7 belong to NTPC’s different stations. Therefore NTPC station’s performance is very near to India’s benchmark i.e. Dhanu TPS. As per IDEAS – A Report on Power Sector by CII, in the power generation there is a large productivity gap between India and USA, which has been shown in Fig.4 . Within India also large gaps exist between top performers like Dhanu, NTPC on one hand & SEBs on other hand. To bridge this huge productivity gap and to reach at US level even in NTPC, Radical Improvement in Performance is needed. After analyzing the Fig : 4, the followings inferences have been drawn after comparing the performance with US which can be applicable to NTPC :



1. With respect to Best Practices in India :

• Poor Quality of coal with high ash content and shortage of domestic coal

• Less availability of Gas

The gap of lack of ‘viable investment’ and ‘High growth rate’ are also not the concern for NTPC.

2. With respect to SEBs : • Low Capacity Utilization of their Plants

The other factors like excess manpower and lack of scale etc cannot be addressed by NTPC.



SEBs

Excess Manpower

Poor OFT*

Lack of viable investments

Lack of Scale

Best Practice India

Supply Relations

Lack of viable investments

Lack of infrastructure

India potential

Supplier relations

High growth rates

Plant mix

US averages

27

30

13

7

3

80

3

1

2

86

4

5

5

100

• Low capacity utilization.

• Inefficient deployment of manpower.

• Over engineering. • Construction

overruns

• Poor quality coal • Shortage of coal

• High ash content coal.

• Higher Capital work-in-progress

• Less availability of Gas

Fig. 4 : Reasons for Productivity Gap Generation * Organization of functions and tasks

India average = 34%



FINDINGS : After critically analyzing the primary and secondary data, we conclude that following options can be implemented to bring Radical Performance Improvement not only in NTPC but also in Indian Power Sector. SL

OPTIONS CLASSIFICATION

REASONS FOR SELECTION

1. (a) Emphasis on Coastal Power Station

(b)Transformational Outsourcing in the Areas of IT, Unit Overhaul & Ash Utilization

Organization Due to shortage and poor quality of domestic coal

To improve economy of operation & best utilization of Resources

2. (a) Going for new gas finds

(b)Exploiting unutilized Hydro capacities.

(c) Skill Development & Knowledge Management

Resource New gas finds in East Coast

Large unutilized potential of Hydro with zero emission

To equip ourselves for multi diverse functions.

3. a) Nuclear Technology Long Term Energy



Power in a Big Way.

b) New opportunities using hydrogen as fuel for electricity generation

Security to the Country with low variable cost and shortage of Coal.

Latest Technology and new revolution in power field with minimum impact on environment.

4. Strategic Alliance/ JV for R&M of Old SEB Stations on Profit Sharing basis.

Market Large scope of improvement in generation efficiency with pollution reduction and availing benefits under CDM.

ANALYSIS OF FINDINGS : 1. (a) EMPHASIS ON COASTAL POWER STATIONS : The power crisis resulting from the mismatch between domestic coal production and power plant requirements has stressed the need to diversify coal sourcing for the sector. Dependence on imported coal is now a fact. This fiscal the power sector faced a shortfall of 20 mmt, for which 14 mmt of high heat value imported coal had to be procured.



Besides, shortfall in coal production, marginal dependence on imported coal will help preserve indigenous coal reserves. India’s coal reserves are to the tune of 300 billion tones, however assessments show that only 100 billion tones of the reserve are exploitable. Complete dependence on indigenous coal could prove to be dangerous. Coal will account for 60% of the power produced in the country at in 2012. Developing coal-based power plants along the coastline is essential. The proportion of coal based power stations in the coastal regions must go up form 3% to 15% in the next 10 years, as decided in the meetings of all SEBs and Central Power Ministry in August, 2005. Recently, Government announced for outright cancellation of licenses awarded three years ago to public and private power utilities for exploration of over 40 coal blocks since these have failed in undertaking any exploration exercise. The decision would impact country’s largest power producer NTPC the most as it had decided to enter coal mining to meet captive requirements of its thermal power plants. As per latest data from CEA, the cost of Generation by Imported Coal up to 300 KM from Port is cheaper than the Cost of Domestic Coal at Load Center at of 80 % PLF In view of above, it is now much more important for NTPC to go for Coastal Power Plants so that the dependence on domestic coal could be reduced. 1. (b) TRANSFORMATIONAL OUTSOURCING :

We suggest that NTPC should enter into strategic Partnership on the lines of transformational outsourcing in the following areas :



i) Global companies can be given contract for overhauling

of Thermal or Gas Units with commitment on increase in efficiency with profit sharing on additional improvement in efficiency after overhauling.

ii) IT (Information Technology) –In order to utilize all resources properly implementation of ERP is most important. To increase the pace of implementation of ERP and other facets of IT we propose to strategically outsource IT, as it is happening in the company’s like Bhatri Tele Venture.

iii) Ash Utilization : NTPC can enter into strategic alliance with the Cement Industry for installation of Cement Plant and other utilities for Ash utilization on Profit Sharing Basis.

2 (a) GOING FOR NEW GAS FINDS : As per recent article in Economic Times by former Director General of Hydrocarbons, East Coast has potential to provide 100 TCF of gas within a span of 10-15 years. Over 20 TCF of gas reserves have already been established along the east coast and work on another 20 TCF is going on. With this the natural gas production level of 250 to 350 million standard cubic meters of gas per day or even more would be feasible. Certainly east coast discoveries are possible solution to India’s growing energy needs. It is almost certain that in the next five year the east coast can produce between 120-150 mmscmpd of additional gas over and above the countries gas production of about 85 mmscmpd. Thus the county has a potential to at last triple its gas production in the next 5-6 years.



In view of above following road map is proposed.

1. NTPC can also get several blocks allocated for exploration, by

adopting strategy of backward integration. 2. NTPC can enter into installation of Gas Based Captive Power

Plants to meet out the needs of Bulk consumers Keeping Kyoto Protocol in mind, running of Combined Cycle Gas turbine in much more beneficial even at high price of natural gas compared to coal, because the cost of reduction of 60% of CO2 emission in coal fired plants, will offset the higher price of natural gas.

Fuel Type and generation

technologies

Average thermal

efficiency (%)

Fuel cost $ / MW

CO2 emissions ( tons of CO2

/ MW)

Fuel cost + CO2

reduction cost +

annualized capital cost

Sub critical coal plant

33 20.68 1.086 48.92

Combined cycle natural gas

48 37.88 0.414 48.44

Super critical coal plants

38 17.96 0.943 58.49

( Source – platts POWER – vol. 148- No. -5 June 2004). This table based on 5 year price projection of $2/MM Btu for coal and $ 5.30/MM Btu for natural gas.



2 (b) EXPLOITING UNUTILIZED HYDRO CAPACITIES : Hydro electricity is clean energy end its generation not linked to issue concerning fuel supply, especially the price volatility of imported fuels. It enhances our energy security and is ideal for meeting the peak demand. However share of Hydro has gradually declined as shown in table below:

Plan Hydro Thermal

1st Plan 35% 65%

3rd Plan 46% 54%

5th Plan 41% 57%

7th Plan 25% 71%

9th Plan 25% 72%

UNTAPPED HYDRO POTENTIALS Arunachal Pradesh 50,000 MW UP / Utranchal 13000 MW Himachal Pradesh 13000 MW J&K 12000 MW

Source:- Blueprint for Power Sector Development, Govt. of India

Huge potential lies in Himalayan states and in North East, which can be harnessed by NTPC. Present NTPC target of 11000 MW upto

Only 17% of vast Hydel potential of 150,000 MW available in India has been tapped so far, whereas countries like Norway, Canada etc. are utilizing more then 40% of their hydro potentials.



2017 can be increased to 20000 MW being 30% of targeted 66,000 MW. 2 ( C ) SKILLS DEVELOPMENT AND KNOWLEDGE MANAGEMENT

( SHARPEN THE SAW)

Keeping our skills up to date has always been important, now it has become critical. We must ensure that, our team shall always meet the technical challenges which are growing by leaps and bounds.

KEY CHALLENGES ARE : (a) How to minimize loss of institutional memory which is

occurring on accounts of retirements. (b) How to extract TACIT knowledge and how to leverage it for

Radically Improving Power Sector. (c) On personal level how power professionals can acquire

diverse skills so that they can move from one area to other under the diversified portfolios of the company.

(d) How to compile network integrated knowledge and best practices available at Intra and Inter Sector level for the overall benefit of the sector.

(e) Time constraints and added responsibilities on power professionals also needs to be addressed.

OUR TEAM PROPOSES THE FOLLOWING :

i. As a part of transformation study, NTPC is already implementing IT based knowledge management (KM). In the same way a Central KM portal shall be started for the whole power sector.

ii. Best Practice Centre under the Ministry of Power shall be constituted which should not only compile the best O&M, R&M ,



Construction and Erection practices of the used of power sector, but it should also direct the implementation of those practices in other plants.

iii. Various certification based “Online Modules” related to power sector shall be developed for the professional of power sector on e-learning mode. At least one module should be undertaken by each executive per year as per approved TNA (Training Need Analysis).

iv. For rapid multi-skilling of non-executive staff we propose implementation of ‘Each One - Develop One’ philosophy. Through this each executive shall develop one identified additional skill related to power sector in one of his subordinate every year.

3. (a) GOING FOR NUCLEAR POWER IN BIG WAY: Share of Nuclear power is growing in the developing world’s electricity generation. The overall cost of nuclear power is seen to be favorable as compared to thermal fuels in countries that do not have access to cheap sources of coal or gas. Moreover, nuclear power offers other advantages including higher environmental cleanliness, lower exposure to fuel price risk and longer plant life. As shown in the diagram (Figure 4), India is lagging behind the developed countries in exploitation of Nuclear resources. In India, as on March 31, 2005, Nuclear Power Corporation of India (NPCIL) had fifteen reactors in operation with a combined capacity of 3120 MW.



Fig 5 : Largest Users of Nuclear Power (‘000 MW in Mar’ 2005)

Error! Developmental efforts of NPCIL have led to substantial indigenization and presence of competent domestic vendors of nuclear plant equipment. India is also endowed with sufficient reserves of thorium. On account of these advantages, nuclear power has the potential to contribute meaningfully to the future base load capacity in India. The constraint in growth of Nuclear Power can be surmounted by strong Balance Sheet and project management capabilities of NTPC and thereby prove to be a source of competitive advantage in establishing nuclear power generation capacities. However, only NPCIL is mandated to set up Nuclear Plants in India.

US France Japan Germany Russia S. Korea India

World Total Capacity98

64 45

22 21

14 3.1



Availability and Price risk for other thermal fuels such as coal and gas

High similarity between Nuclear and thermal generation

Shortage of domestic

coal and rising prices

Unavailability of adequate gas

Large part of Nuclear Generation similar to Thermal Generation :

NTPC expertise in steam turbines

Synergies to reduce project lead time

High entry barriers and long-run economic viability of Nuclear power

Ability to leverage existing skills

Low variable cost

High Entry barrier due

to Central Govt Control

Can raise long term finances at better rate due to strong Balance Sheet

Strong EPC capabilities can reduce Project Lead Time

Fig. 6 Nuclear Power – NTPC’s Sustainable Competitive Advantage

GoI has plan of adding 9500 MW of Nuclear Capacity, but NPCIL is working only on 4000 MW. Therefore there is unallocated capacity of 5500 MW of Nuclear Power during 10th and 11th Plan. In our view NTPC should grab this opportunity, taking advantage of our capabilities:



1. NPCIL has up-scaled up the standardized 220 MW to 540 MW in TAPP-4, which was commissioned in less than 5 years against average of 8 years earlier.

2. The capital cost of Nuclear Cost has generally stabilized in view of the standardization of reactors.

3. With the gain along learning curve the Nuclear plants in India are running at 90% PLF.

4. The fuel cost is 1/3rd to 1/5th in comparison to Coal fired Plant and CCGT.

5. The profitability ratio of NPCIL is high as 47% and ROCE is 11% during 2003-04 .The PLF of Nuclear Plants is also consistently improving.

6. There is untapped market of 5500 MW capacity during 10th and 11th plan. By going for JV with NPCIL, the return on equity could be as high as 36% for NTPC. This is assuming capital cost of Rs. 5.23 Crores per MW, and D/E ratio of 1:1,and equal equity participation by NTPC and NPCIL.

3. (b) NEW OPPORTUNITIES USING HYDROGEN AS

FUEL FOR ELECTRICITY GENERATION:

Scottish and Southern Energy (SSE), BP, ConocoPhilips and Shell have announced they are to start engineering design on what could turn out to be the world’s first operational large-scale carbon free fossil fired power plant with CO2 sequestration. The plan here is to reform natural gas to hydrogen and CO2. The hydrogen would be used to fuel a new 350 MW combined cycle power station, to be located close to SSEs re-powered Peterhead station in north-east Scotland. The CO2 ( 1.3 million t/y) would be exported via existing pipelines to the Miller oilfield 240 km offshore, for enhanced oil recovery and for storage. This would extend the life



of the Miller field, which is operated by BP (52%), with partners ConocoPhilips ( 30%) and Shell ( 18%), by 15-20 years. With this information, we propose NTPC to enter into R&D for adopting this technology and enter into joint venture with oil exploration companies for reverting back extracted CO2 to the oil fields. This will help in introduction of 350 MW H2 fuel based combined cycle power plants with zero emission of CO2 . On the similar lines of above we can also explore the possibilities of using hydrogen (H2) as a fuel for generation electricity on larger scale. We can also go for R&D to generate electricity from H2 on small to medium scale through various types of fuel cells like phosphone acid (PAFC), molten carbonate (MCFC) and solid oxide (SOFC) and can use the same for distributed generation. 4. STRATEGIC ALLIANCE FOR R&M :

Out of 98 Steam Turbine Power Stations, 49 Stations of 21040 MW are running at PLF less than 30%. It means turnaround of these 49 units itself can bring radical change in Power Sector On financial front also, improving the existing capacity by R&M and life extension of plant is cheaper option than installation of new units, because at present cost of R&M is less then Rs 1 crore against Rs 4-5 crores per MW for new plant. NTPC has demonstrated its turn-around capabilities by revamping Unchahar,, Talchar & Tanda Thermal Power Plants. The recent one



Tanda Thermal Power, Station has been brought upto PLF more than 80% ,from 20% within a span of 4 years. Following limited progress in R&M of SEB Power Plants in the first phase has been achieved:

No. of plants in which R&M carried out 34

No. of units in which R&M carried out 163

Total capacity of these units 13570 MW

Average PLF before R&M 46 %

Expected PLF after R&M 53 %

Actual PLF after R&M 56 %

Estimated increase in generation 7000 MU/year

Actual increase in generation 10,000 MU/year

Above figures indicate that although improvement has taken place but it can’t be considered as radical as it has happened at TANDA. On the basis of the above, it is proposed that instead of taking over a plant and improving its performance, we propose that NTPC should enter into strategic alliance with the SEBs for improving and demonstrating the Radical Improvement on profit sharing basis. This will be beneficial in many ways such as –



1. By this the cultural issues which arise on account of take over can be over come as ownership of the plant will remain with the same SEB.

2. It is win-win situation for both SEB’s as well as NTPC. After

demonstrating the successful running at higher PLF, NTPC can withdraw its inputs.

3. Power Sector will get benefited by getting additional MW of

Power i.e. by increasing its productivity. ROAD MAP: Looking in to the various activities and time frame involved in implementing the options, we have categorized the selected options in to Short & Long Term as given below :

SHORT TERM LONG TERM

Emphasis on Coastal Power Stations

Going for Nuclear Power in a Big Way

Transformational Outsourcing

Tapping Unutilized Hydro Potential

Skill Development & Knowledge Management

Exploration of New Gas Fields

Strategic Alliance /JV for R&M of Old SEBs Stations

R&D for Using Hydrogen as Fuel for Electricity gen

Looking in to the priority and importance we have prepared the detailed Road Maps based on the four stage template designed by McKinsey for “Radical Performance Improvement” given below, for the following two Options :



• Emphasis on Coastal Power Stations • Going for Nuclear Power in a Big Way

However, milestone charts for remaining options have been prepared and included in the write up after the road maps.

Roadmap for Radical Performance Improvement :

(Based on McKinsey’s Template )

Direction Setting

Process Design

Realignment


• Analyzing Marketplace and Organization

• Common Vision • Examining the

Experience of others

• Top Down • Bottom up • Core Process Redesign

• Creating a Change Organization

• Qualifying Specific Performance Objective

• Mapping Performance Improvement Approaches

• Structure • Systems • Staff



(A ) ROAD MAP FOR EMPHASIS ON COASTAL POWER STATIONS : 1.0 Direction Setting : 1.1 Analyzing Marketplace & Organization : There is a

mismatch between demand & supply of coal for power station based on domestic coal. The projected shortfall this year is 20 MMT, which can be met only through import of coal.

1.2 Common vision : To achieve target of becoming 66000 MW company by 2017, NTPC must develop coastal power station of at least 3500 MW in near future based on imported coal.

1.3 Examining the Experience of Others: The costal plants have been set up in the countries where coal is in short supply and the plants are competitively supplying the power.

2.0 Process Design : 2.1 Creating a change Organization : NTPC has to prepare for

setting coastal Stations for at least 15% of its total future coal power capacity i.e. around 3500 MW.

2.2 Qualifying specific performance objections: While going for coastal power station NTPC has to study the demand forecast in the coastal status like Gujrat, TN, AP Karnataka & Maharastra. Depending upon the demand, the location of coastal power station can be finalized. NTPC must generate power from these stations at most competitive rate to get full demand for its power.



2.3 Mapping Performance Improvement Approach: The goal of coastal power station to imprint on all functions and processes, to strengthen the weak areas.

3.0 Performance Improvement: 3.1 Top Down: For this NTPC Top Management will provide

necessary approval after studying all aspect including Cost Benefit analysis.

3.2 Bottom Up: For Engineering, Contract Award, Erection, testing and commissioning support of all concerned will be needed. The mega plant will be set with super critical boiler using state of art technology.

3.3 Core Process Redesign: Necessary fine tuning of various processes viz. planning, capacity addition, Finance, commercial etc for entry into new ventures will be done.

4.0 Realignment: 4.1 Structure : The new group under the Director ( Project) will

be formed for the execution. The existing Organization Structure will be utilized with reinforcement on key area.

4.2 Staff: The relocation of staff at various levels with judicious mix of experienced staff from other units and fresh recruitments. Suitable system of hiring, career growth, reward and incentive will be devised.

4.3 Systems: All system including Information System shall be designed to be capable of supporting the challenging target.



5.0 Milestones:

Activity Period in Months

End Date

Approval from NTPC Board for setting up coastal Power Stations based on imported coal

06 months Mar’2006

Feasibility & Detailed Project Report

12 months Mar’2007

Final approval from all Stake Holders required for setting up of imported Coal Based Coastal Power Station including investment approval

06 months Sept’2007

Construction of Coastal Power Station

38 months Dec’2010

B) ROAD MAP FOR GOING FOR NUCLEAR POWER IN BIG WAY: 1.0 Direction Setting : 1.1 Analyzing Marketplace and Organization: Lately Nuclear

plants have become very competitive. The shortage of fossil fuels and environmental concerns is making nuclear energy a preferred choice. GoI has set up target of 9500 MW capacity up to 2012, but the implementing agency NPCIL has been able to work on 4000 MW only. NPCIL has shown interest to form JV with NTPC, but NTPC is planning to enter in this



business only in 12th Plan due to preoccupation with other projects.

1.2 Common Vision : To build up 5500 MW Nuclear Portfolio by

2017, by constructing most advanced and safe plants, performing at global benchmark level.

1.3 Examining experience of others: In India the capacity utilization of Nuclear plants has improved up to 90% which is world class. The Nuclear Reactors have been almost completely indigenized, and almost all components can now be procured from Indian vendors.

2. Process Design :

2.1 Creating a Change Organization: A new organization in form of JV will be formed, with specialist from all functional area like Finance, Engineering, and Construction etc.

2.2 Qualifying Specific Performance Objectives: To set Nuclear plants without time and cost overruns and to run these as most safe and efficient plants. NTPC must generate power from these stations at most competitive rate to get full demand for its power.

2.3 Mapping Performance Improvement Approaches: All business processes are to be tuned for entry in new venture to identify and strengthen the weak areas.

3. Performance Improvement : 3.1 Top down: For this NTPC Top Management will provide

necessary approval after studying all aspect including Cost Benefit analysis.

3.2 Bottom Up: For superlative performance in Engineering., Contract Award, Erection, testing and commissioning support



of all concerned will be needed. The nuclear plant will be set with state of art technology by the project team.

Core Process Redesign : Necessary fine tuning of various processes viz. technology transfer, planning, capacity addition, finance, commercial etc for entry into new ventures will be done.

4. Realignment : 4.1 Structure: The present functional cum matrix structure has to be

realigned to the needs of problem solving and sharing of information

4.2 System including Information System: Information System has

to be redesigned to capture the information and leanings. All costs are to be analyzed and compared regularly with the targets.

4.3 Staff : A much clearer definition of the types of people and skills needed will be developed. Best talent will be hired for the challenging new venture. Hiring, training and promotion requirements, as well as balance between technical and managerial skills, will be redefined.

5.0 Milestone for Nuclear Power:

Activity Period in Months

End Date

Management clearance 6 Mar’ 2006

Formation of JV 12 Dec’ 2006

FR, Techno Economic Clearance, DPR and Investment approval

24 Dec’ 2008



NIT 12 Dec’ 2009

Construction 60 Dec’ 2014

The milestone charts for the remaining options are as follows:

MILESTONE CHART FOR TRANSFORMATIONAL OUTSOURCING

TRANSFORMATIONAL OUTSOURCING

Selection of IT Giants

(Sept’ 2006)

Identifying Activities

( Mar’ 2006 )

Implementation Of Activities

( March’ 2007)

Ash Utilization InformationTechnology

Identifying Partners to

form JVs ( March’

2006)

Opening Subsidiary ( Dec’ 2005)

Agreement Based on % Ash Utilized ( June’ 2006)

Unit Overhauls

Identify Capable Vendors

( March’ 2006)

Opening Subsidiary at Regions ( Dec’ 2005)

Agreement Based on %

Improvement After O/H

( June’ 2006)



MILESTONE CHART FOR EXPLORATION OF NEW GAS FIELDS

Management Decision, Surveys, Bidding for New Fields & Development of Infrastructure for Exploration

(Mar’2007)

Detailed Project Report & Govt. Clearance, Financial Tie ups

(Mar’2009)

Plant Construction (Dec’ 2012)

Tendering & Award of Work ( Dec’ 2010 )

Commercial Operation (April’2013)

Searching of Bulk

Consumers & Tie up for

National Gas Grid

( Dec’2008)

Gas from New Fields

(March’2008)



MILESTONE CHART FOR TAPPING THE UNUTILIZED HYDRO POTENTIAL

Management Decision, Surveys, Govt. Clearance, Financial Tie ups

(Mar’2007)


Commercial Operation

(April’2013)

Plant Construction

(Dec’ 2012)



Impact Measure

ment (June’07)

Evaluation at the end of year

(Mar’07)Imparting knowledge & skills (on the

Job) (Dec’06)

Identification of

Trainer-Trainee

pair (Feb’06)

Identify Employee wise skills required to

be developed (Dec’05)

Each One

Develop One

Milestone Chart for Skill Development- Each One

Develop One

Cycle to be repeated every

year

Note : Centralized KM portal can be developed on similar lines of NTPC KM portal.



MILESTONE CHART FOR USING HYDROGEN AS CLEAN

FUEL

R&D FOR USING HYDROGEN AS A FUEL FOR LARGE SCALE POWER GENERATION

OR TECHNOLOGY TRANSFER

( Dec’ 2008 )

Surveys, Govt. Clearance, Financial & Fuel Tie ups ( Dec’2009)

Plant Construction

(Dec’ 2012)


Commercial Operation

(April’2013)



MILESTONE CHART FOR STRATEGIC ALLIANCE FOR R&M

FORMATION OF R&M SUBSIDARY (31.12.05)

BIDDING PROPOSALS TO SEB’s / SICK PLANTS

Temporary Takeover

Rate Negotiation w.r.t. Efficiency

Improvement after R&M

Turn Around

Transfer

Within Three months after

Rate Negotiations

Within Three Years after Takeovers

Within Three months after Turn Around

Application for CER* under CDM* for Emission Reduction of Kyoto protocol

(* Note : CER : Certified Emission Reduction, CDM : Clean Development Mechanism )



NTPC- DADRI

QUEST FOR EXCELLENCE (Q4E)

BRAINSTORMING SESSION

RADICAL PERFORMANCE IMPROVEMENT (IN NTPC)

Sl Area My Suggestions 1 Organisaional Level

2 Resource Level

3 Technology Level

4 Market Level

Signature

Name Designation

Date



CONCLUSION Though NTPC has established itself as the premier company in power industry in India, still there is scope for Radical Improvement in Performance. To lead the Power Sector towards world class performance level, NTPC has to be in forefront of new technology like use of Hydrogen, alternate fuel options like use of Nuclear & use of imported coal by setting up Coastal Power Stations, new management practices by using Skill Development & Knowledge Management and Environment protection initiatives by tapping untapped Hydro Potential & doing R&M of old SEBs stations. Transformational outsourcing as suggested in certain areas along with exploration of new gas fields may bring the radical improvement in operational productivity. The new initiatives will help in Radical Performance Improvement, but at the same time invite higher business risks- to be astutely managed. To be successful the value base approach would need to be focused, balanced, integrated and team based.



REFERENCES : 1. IDEAS Empowering the nation : Report by CII. 2. A.P.J. Abdul Kalam, Vision 2020 3. Sumantra Ghoshal ,Gital Piramal, Christopher A. Bartlett ,

Managing Radical Change. 4. platts POWER – June - September’2004 Issues. 5. Modern Power Systems – August’2005 Issue. 6. Power Line – July’2005 Issue. 7. Economic Times – Page-7 Dated 5th July’2005. 8. India Today – August 29 2005. 9. Blueprint for Power Sector Development – Govt. of India. 10. Report of “The Expert Committee on Fuels for Power Generation” –

Executive Summary by CEA. 11. Reengineering The Corporation – Michael Hammer & James Champy 12. Miller, Ken, The Change Agent's Guide to Radical Improvement,

AQS. 13. Steven Dichter, C Gaagnon, Askok Alexander, Leading Organizational Transformation, Mckinsey Journal 14. NTPC Corporate Plan 2002 to 2017 . 15. Organizational Transformation – Project Disha Reports on Strategy

and Business Processes. 16. Parisamvad ( Issue dated August 11, 2005 ) - Communications letters

from CMD. 17. Web Sites : CEA, NPCIL, Ministry of Power, eia.doe.gov,



ABBREVIATIONS

CCGS Combined Cycle Gas Station CCGT Combined Cycle Gas Turbine CDM Clean Development Mechanism CEA Central Electricity Authority CER Certified Emission Reduction CII Confederation of Indian Industry DGM (F&A) Deputy General Manager (Finance & Accounts) DPR Detail Project report E1 Executive Cadre 1 ERP Enterprises Resource Planning FR Feasibility Report GE General Electric GoI Government of India HODs Head of Department IDEAS Initiatives to Develop Electricity Affordability

and Supply IGCC Integrated Gasification Combined Cycle JV Joint Venture mmscmpd Million Standard Cubic Meter Per Day mmt Million Metric Ton NIT Notice Inviting Tender NPCIL Nuclear Power Corporation India Limited NTPC National Thermal Power Corporation Limited PLF Plant Load Factor R&M Renovation & Modernization SEBs State Electricity Boards TCF Trillion Cubic Feet



Q4E-2005

Team: Samir Chaudhury Kumud Wadhwa Sunil Kumar

Organisation : POWERGRID – Corporate, IT Deptt.

Title:

Radical Performance Improvement Through Information Technology



Abstract This paper attempts to bring out a ROADMAP for Radical Performance Improvement through Information Technology. Radical Performance Improvement is the need of the hour in the evolving and dynamic scenario of Power Sector. In order to bring out Radical Performance Improvement, an organization can strategically leverage the potential of information Technology and establish IT enabled systems and processes. This would result in radical improvement in overall performance of key performance indicators of Critical ingredients. In Section-I of the paper, “A Model Road Map” has been depicted for achievement of Radical Performance Improvement in Critical ingredients & Key Performance Indicators. The ROADMAP consists of four roads (Road I, Road II, Road III, Road IV) pertaining to different aspects of improvement areas. Road I and Road II has its basis as Learning from the prototype deployment of POWERGRID while Road III is an innovative approach in future direction and Road IV has its basis as International Case of best practices. In Section-II, “How to Bring Radical Performance Improvement” following the specific roads has been brought out indicating the tangible benefits in terms of percentage improvement in individual parameters. Impact of IT enabled system has already been realized on the respective areas following Road I, II. However, further scope of improvement in performance exists in terms of parameters set for various aspects covered under these roads. Road III and Road IV depicts the additional quantum of improvement of some of the aspects covered under Road I, II and also the new avenues and respective associated parameters for Radical Performance Improvement.



In Section-III, “Design & Implementation of Mechanism” for Radical Performance Improvement has been discussed. Salient features of various IT enabled systems adapted / proposed and their benefits ,Uniqueness have been outlined sequentially in descriptive format. The figures mentioned have been compiled from case studies, experience, and analytical data of POWERGRID. An international case study has been cited to indicate workable solution in one area mentioned in ROAD IV.



SECTION-I

A MODEL ROADMAP FOR


RADICAL PERFORMANCE IMPROVEMENT – Critical Ingredients Radical Performance Improvement is essentially quantum improvement in Key Performance Indicators of Critical Ingredients visible in a relatively shorter span of time as against incremental improvement of lesser magnitude over longer period. The ROADMAP for Radical Performance Improvement has the objective of setting up a course of adopting process sustainable on long term basis. The continuously growing and more demanding business environment calls for Radical Performance Improvement on all fronts in terms of quality & quantity of output. In order to develop a model Roadmap for Radical Performance Improvement the following critical ingredients have been identified to demonstrate visible and appreciable impact on a sustainable basis in long term scenario: -

• Reliability and Quality of Power • Time Efficiency • Cost Efficiency/Cost Avoidance • Productivity/Quality enhancement • Responsiveness • Transparency & Accountability • Innovativeness



ROADMAP The ROADMAP for Radical Performance consists of four Roads as below: ROAD I: SCADA/EMS – For Reliability & Quality of Power. Web Based Business to Business – For Time Efficiency. ROAD II: VIDEONET, VOICENET – For Cost Efficiency. ROAD III: Embedded Knowledge Management System –For Productivity Enhancement ROAD IV: Enterprise Wide Integrated Management System – For All of The Above



ROADMAP FOR RADICAL PERFORMANCE IMPROVEMENT

SCADA Supervisory Control and Data Acquisition EMS Energy Management System IMS Inspection Management System

VOICENET Network of Voice Communication System

VIDEONET Network of Video Conferencing System

SCADA / EMS / IMS

VIDEONET, VOICENET

EMBEDDED KNOWLEDGE SYSTEM

Enterprise wide Integrated Management

Roadmap for Radical


Road – I

Road – II

Road – III

Road – IV



SECTION-II HOW TO BRING

RADICAL PERFORMANCE IMPROVEMENT The Key Performance Indicators of Critical Ingredients mentioned in Section I are the targets and the suggested Roads are the course to be undertaken towards Radical Performance Improvement through Information Technology. Information Technology, is the common denominator for all-round improvement of organizational performance, IT enabled processes and systems hold the key to Radical Performance Improvement. Quantum jump in the key performance indicators can be achieved for the direct and tangible effect on the critical ingredients identified and mentioned in section I. ROAD I and ROAD II are based on prototype implemented in POWERGRID and patterns of success and potency of state-of-the-art technology which can be harnessed for Radical Performance Improvement by organizations at large. ROAD III is an innovative approach in future direction and ROAD IV has its basis as International case of best practices. ROAD I: SCADA/EMS, IMS

Enhancement of Quality and Reliability of Transmission by 60%

Reduction of Project Life Cycle Time by 10% ROAD II: VIDEONET, VOICENET



Reduction of Communication Cost reduction by 50 %

ROAD III: Embedded Knowledge Management System

Reduction in Troubleshooting time to 50%

The level of improvement on the key performance parameters achieved so far following the above Roads is envisaged to be further enhanced through Road IV in future as a continuous process for radical performance improvement.

ROAD IV: Enterprise Wide Integrated Management System

The key performance indicators of Critical Ingredients targeted is proposed to be achieved through modules of IT enabled system as mentioned below: Collaborative project management

• Reduction of Project Life Cycle Time by further 20% • Reduction of decision making time to one tenth of current

time • Minimizing Cost and Time Overruns

Asset Management • Reduction in O&M administration cost by 25% • Increase in Availability of Transmission system

Task Management

• Human productivity increase by 30%. • E-Learning to improve quality of job done.



SECTION-III

DESIGN & IMPLEMENTATION OF MECHANISM FOR


The detailed description of schemes covered under the four Roads mentioned in the Roadmap, their benefits, uniqueness and future directions are described below in this section: ROAD -1 ENHANCEMENT OF RELIABILITY & QUALITY OF POWER TRANSMISSION The present power supply system involves integrated operation of Regional Power Grids, State Grids and Distribution System Security, Quality, Reliability and Availability are critical parameters of power supply system. Quality of power supply must meet certain minimum standards w.r.t constancy of Frequency and Voltage. Poor grid discipline due to lack of co-ordination among multiple constituents was a concern for Integrated Grid operation which adversely affected Quality and Reliability of power. POWERGRID has deployed through establishment of Supervisory Control and Data Acquisition/ Energy Management System as a part of journey along Road I. Supervisory Control and Data Acquisition/Energy Management System(SCADA/EMS) SCADA/EMS system aims at making available real time power system data to Grid Operator to help him instantaneously decide how, what, where to intervene in power system to ensure reliability and



operation of grid in most optimal stage. As power systems grow in size and complexity so do the problems of co-ordination to meet the basic objectives of costs, reliability, quality and safety. The relative value and priority of these objectives are determined by each state electricity utility according to its circumstances. However the electricity Grid are interconnected and decisions taken by one utility impacts others also. Hence it is important that there is appreciation of each others requirement and decisions are taken in a coordinated manner. Control centres play an important role in the achievement of these objectives because they are the main means of co-ordination of system operation. The SCADA/EMS system utilizes State of the art technology for SCADA and EMS with hierarchical system which includes Regional Load Despatch centers (RLDC) at the apex level and the Remote Terminal Units (RTUs) at Power Station/Sub station at the lowest level. In between there are Sub Load Despatch Centers (Sub LDC) and State Load Despatch Centers (SLDC). The RTUs acquire and forward parameters like voltage, frequency, MW, MVAR etc. to Sub-LDC/SLDC/RLDC in real time. The data is processed and analyzed by software to advise operator in discharging assigned functions at each level.



RTU RTU RTU

SUB LDC SUB LDC SUB LDC

SLDC SLDC SLDC

ERLDC WRLDC NRLDC SRLDC NERLDC5 Nos.

NLDC

32 Nos.

51 Nos.

1160 Nos.

National

Level

Region

State HQ

Group of Districts

Plant / SS

Unified Load Despatch and Communication System

BENEFIT

1) Paradigm shift in Indian Grid Management with no major grid disturbance in last three years and number of minor grid disturbance has reduced to single digit. A single major grid collapse costs Rs. 700/Crore national loss(graph attached as Annexure)..

2) The System parameter(Voltage & Frequency) and the quality of

power have improved significantly (graphs attached as Annexure).

UNIQUENESS OF THE PROPOSED SYSTEM

1. The Technology is State-of-the-Art .The scheme is unique in its concepts and the extent of the coverage

2. The deployment of the scheme is regarded as a global benchmark in the field of Power System Management.



FUTURE DIRECTION Short Term: The ROADMAP envisages the following course of action: The present system has been deployed in POWERGRID for Management of transimission system at Regional level.The system needs to be further integrated upward at National level for Radical Performance Improvement in the Quality & Reliablity of Power Supply. Long Term: Since distribution system continues to remain the weakest link in suplly of Quality and Reliable power supply the suggested SCADA/EMS system is to be also adopted by all states for distribution system. Reduction of Project Life Cycle Time Information Technology has been effectively used in deploying e-enabled interactive systems which reduce project life cycle significantly. Reducing project life cycle results in reduction of IDC and increases the over all cost of execution and hence profit. One of the unique example of Project Life Cycle Reduction through IT is Inspection Management System(IMS) deployed in POWERGRID. Inspection Management System(IMS) POWERGRID’s quality policy stipulates stringent Quality Assurance for Equipment (Material) as well as a field execution activities to conform to Quality standard. Quality Assurance through pre-despatch inspection of Equipment and Materials at suppliers premises is vital element in this process. This involves a multi-location, multi-agency,



and multi-order scenario and demands Centralized coordinated interactive database management system – hence the need of IMS. The Material inspection activity is communication intensive. Earlier, letter/fax/telephone were the mode of communication which resulted in undue delay of the process and lack of coordination . IMS is a B2B application which provides an on-line interactive, coordination of inspection activities through web platform for communication between the suppliers and the Quality Assurance and inspection department. It has also inbuilt work flow which automates material inspection lifecycle. The complete process flow diagram of the inspection activity is as follows:

10

NEW DELHI

KOLKATA

VADODARA

BHOPAL

HYDERABAD

BANGALORE

CHENNAI

MUMBAI

NAGPUR

FORIEGN

INSPECTION MANAGEMENT

SYSTEM

SUPPLIER

INS

PE

CTI

ON

EN

GIN

EE

RS

REGIONALOFFICES

CORPORATEOFFICE

ADMIN

SUPPLIER

SUPPLIER

Structure of Inspection Management System



Supplier raises call for inspection. The call is routed by the Administrator of Inspection department, Corporate Centre to respective regional inspector. Once the call is reflected in concerned inspector account he/she carries out inspection on scheduled date and fills up clearance certificate online. BENEFIT Inspection Management System has reduced the inspection life cycle through improved coordination thereby reducing project lifecycle time by 10%.

UNIQUENESS OF THE PROPOSED SYSTEM The unique aspect of the system is that this a business to business application as a sub-module in e-commerce which is first of its kind deployed so far in any Public Sector organization. FUTURE DIRECTION The Project Life Cycle is suggested to be further reduced by 20% through Collaborative Project Management envisaged with Enterprise wide Integrated application deployment. ROAD -2 Reduction of Communication Cost Cost reduction and cost avoidance remains a perennial challenge for any progressive organization which necessitates conversion of expenditure on infrastructure into investments resulting in tangible benefits. Communication Cost being a substantial part of operating cost, POWERGRID has deployed state-of-the-art IT enabled solution



e.g VOICENET & VIDEONET which is unique and first of its kind in Central Power Sector Organization. VOICENET Implementation of Voice over IP System (VOICENET) is one of the largest implementation of VOIP system in INDIA covering corporate centre and the thirteen regional office of POWERGRID. The VOICENET consists of around 1300 telephones sets distributed over fourteen locations. The system uses the converged communication infrastructure without any additional cost implication. The voice over IP system has Clip, Web integration and voicemail facility and also has support for unified messaging system (which can integrate Voicemail with the email box) . Also the same system works as voice bridge giving audio conferencing facility to upto 6 concurrent users . BENEFIT: Presently number of calls made is around 1100/per day. Average call duration is 10 minutes per call. Taking call cost as Rs.2/minutes. Total saving per Day is Rs.22,000/-. Once the system is stable total calls per day is expected to increase to 3000 calls/per day UNIQUENESS OF THE PROPOSED SYSTEM The VOIP is the State-of-the-Art Technology in Voice Communication fields and the deployment in POWERGRID is the first of its kind in Power Sector Organization in India. FUTURE DIRECTION The system has a potential for expansion to a greater number of locations e.g. Sub-Stations and other offices resulting in radical performance improvement.



After this is extended to sub-station this will further increase to 5000 calls per day. VIDEONET

VIDEONET provides multilocation video conferencing facility to the top/middle management level personnel at Corporate Centre and Regional Head quarters. At corporate centre, Gurgaon a high end Studio Based Video conferencing unit has been installed which is capable of carrying out Video conferencing with three locations simultaneously at 512 Kbps speed . All the Regional Head quarters are equipped with end point video conferencing system . To carry out video conferencing among the POWERGRID close user group location the same network infrastructure is used .Also there is provision to carry out video conferencing with other domestic an overseas organizations through ISDN Dial up lines. The scheme for VIDEONET is shown here under:



BENEFIT: The VIDEONET system is being used on regular basis for Project monitoring, Budget monitoring, e-training, Seminars etc.. The use of video conferencing system has resulted in huge cost saving and time saving by avoiding journey of the top/middle personnel. Cost saving through conducting one review meeting through video conferencing instead of conventional meeting is around 2.5 lacs. UNIQUENESS : The system provides multilocation video conferencing and has a facility for dual mode operation both on ISDN line as well as on IP mode which ensures high order of reliability due to built in connectivity redundancy.



FUTURE DIRECTION: The system is further extensible to a greater number of locations progressively for enhancement in coverage and use. ROAD -3 Reduction of Trouble shooting time Troubleshooting in day to day maintenance activity is a critical area of performance improvement. Troubleshooting time for equipment of similar nature located in various geographically separated remote sub-stations can be substantially reduced through embedded knowledge management system. A knowledge portal facilitates an organized fault wise repository of troubleshooting actions built up on historical data to be used by field maintenance personal for ready reference. Troubleshooting of new fault adds to the knowledge repository. IT ENABLED EMBEDDED KNOWLEDGE MANAGEMENT SYSTEM Knowledge Management is a system of Creating, Capturing, Organising and Using ; updating and reusing useful information simultaeasly by a larger community in participative mode . The ROAD for IT enabled Knowledge Management System would lead to radical performance improvement in Day-to-Day Trouble Shooting Activity. POWERGRID has test deployed Share Point Portal Services for creating Knowledge Bank for KNOWLDEGE PORTAL. KNOWLDEGE PORTAL is a web based electronic platform for capturing functional and other related data which can be utilized as building a knowledge base for reuse and reference on as and when



requirement basis. This comprises of different features of various categorized items with captured data at various instances through sharing of knowledge in an interactive model. Typical snapshot of knowledge portal is shown as follows: BENEFITS:

1) Substantial Reduction in Troubleshooting 2) Saving of Labour & Resources 3) Automatic built of Dynamic Knowledge Base and reuse of

information



KNOWLEDGE PORTAL



UNIQUENESS: The concept and Test Deployment is unique considering the present scenario of Indian Power Sector. FUTURE DIRECTION : The system has a great potency for exploring all possible avenues of populating data from design, operation and field area. ROAD -4 ROAD AHEAD FOR RADICAL PERFORMANCE IMPROVEMENT ENTERPRISE WIDE INTEGRATED MANAGEMENT SYSTEM

An IT enabled Enterprise Wide Integrated Management System is the common solution for carrying out the above in a coordinated fashion. POWERGRID has set the course towards establishment of Enterprise Wide Integrated Management System for Radical Performance Improvement of the Key performance Indicators as mentioned in Section II. Potential Areas for IT enabled Management System Solutions

Significant potential exists in the following areas for deployment of IT enabled Management Solutions: a) Project Management



• Effective planning, monitoring & execution of projects • Controlling time & cost overrun of projects through

exception based project management • Asset life cycle management

b) Operation & Maintenance

• Increased availability through incorporation of best operation & maintenance practices like RCM (Reliability Centered maintenance), TPM (Total Productive Maintenance)

• Improved spare parts management system • Reduction in cost of operation • Increased manpower productivity • On-line real time information through integration of IT

enabled Management Solutions with SCADA system c) Business Intelligence Solution (multi-dimensional analysis)

• High quality timely information for decision support & proactive management

d) Management Dashboard

• Role based information based on profile of executives • Key Performance Indicators & Balance Score Card

EXPECTED BENEFITS

• Efficient operation and maintenance of mission critical assets • Web-based view of critical processes for fast action • Optimized processes • Powerful communication platform • Greatly improved the quality of work and life • Assistance for decision-making • Optimized organization structure

International Case Study:



• OKG group is located at Southern part of Sweden involved in

power generation. It has around 1100 employees and is jointly owned by Sydkraft (E.ON Group) and Fortum.

• They have deployed IFS EAM solution since 1995, which

covers Maintenance, Engineering, Human Resources, Safety Management, Barcode system for inventory management.

• The major benefits derived are as follows: o Better prepared and able to compete in the deregulated

market o Compliance to regulatory requirements o Better planning of outages and new constructions, based

on central government power planning and group-level planning

o Reduced Maintenance, Operation and Administration costs by 25%

o Provide financial reports to owners and technical/operation reports to regulatory authorities

Prototype Deployed at POWERGRID as a Test Case: POWERGRID follows an Integrated Project Monitoring and Control System(IPMCS) for project management which involves which involves integration of multitier activities of Top Down planning and Bottom up review of project activities, status reports, feedback , review need to be captured in a common interactive platform. E-enabled collaborative project management is a user friendly solution to facilitate team work in project management. Collaborative Project Management



POWERGRID has test deployed a prototype module of Enterprise Wide Integrated Management System in line with Integrated Project Monitoring and Control Systems(IPMCS) for project management area which involves integration of multitier activities of Top Down planning and Bottom up reviewing of project activities, status reports, feedback, review need to be captured in a common interactive platform. E-enabled collaborative project management is a user friendly solution to facilitate team work in project management. At the executive level (a senior level business manager), IPMCS can be configured to provide a picture of all the work that’s going on inside their company on their dashboard and they can drilldown to root cause of the problem

Senior Management Interface



For the team member, using the system he gets to know what he is supposed to deliver during the period. How he can collaborate with some other guy the organization to get things done?. They get a platform to know their work and to report status and collaborate on the work they are supposed to do.

Executive Interface

In many of the business areas, the dynamics scenario demands fast decision,which is only possible through IT intervention. The IPMCS is also very useful in reduction of decision making time through its feature of “Development of Issue Database for Projects” which is can be used for reducing the time for decision making.



Issue Database Interface

Another useful feature of Integrated Project Monitoring and Control Systems (IPMCS) which can result in substantial enhancement of human productivity in any organization is its Task management services. The system is tightly integrated with Microsoft Outlook which is one of the most commonly used E-mail Client now a day. Using the OUTLOOK interface the project manager can define task for each of his/her sub-ordinate. Individuals can give progress on assigned tasks on periodic basis. Online compiled status generated for each individual can be used for evaluating his/her performance. This can facilitate performance based incentive system at Small Business Level, department level, team level and individual level.



Task Management Interface TASK MANAGEMENT

Conclusion: The model ROADMAP presented in the paper, if followed by other organization would ensure Radical Performance Improvement. However, the proper implementation of the components of the ROADMAP, is the critical factor in bringing the radical performance improvement. One of the key areas which requires to be addressed is training of the individual users who are supposed to use the system. Training is the important part of technology adaption. The training imparted to the individual is required to be pertinent to his job requirement and the skill set already available with the individual.



Again this can be achieved through IT enabled application by training need analysis. DATA SOURCE

MIS REPORT OF POWERGRID PUBLICATIONS, REPORTS OF MoP, CEA, PLANNING

COMMISION CASE STUDY BASED ON INHOUSE DATA

METHODOLOGY

USER SURVEY DOCUMENT SURVEY COLLATION AND CONSOLATION



Q4E-2005

Team: R Madhana Gopal Roshini Abraham Kunal Khairnar

Organisation : Power Finance Corp. Ltd.

Title:

Rapid Improvement in Performance of Organisation – Redesigning Incentive Payment System – Application of Balanced Scorecard



Balanced Score Card The existing system of giving incentives in PFC is based on the level of MoU targets achieved in the financial year. MoU targets are fixed for every year through an agreement between PFC and the Ministry of Power. Certain parameters, which indicate PFC’s performance, are selected and are given due weights. Targets for the current financial year are fixed keeping into consideration the views of the concerned employees. Actual achievements, at the end of the year, are compared against the targets. On the basis of these achievements, performance measurement index is calculated and the amount of incentive, to be given to each employee, is determined. This system of paying equal incentive to all the employees of the company ignores the extra efforts put in few employees and provides a blanket to the inefficiency of few other employees. Not every employee of the organization is aware as to what is the long term objective of the organization and how is he contributing to the growth of the organization. The existing system does not motivate the employees to improve the working of the organization. To summarize, the existing system suffers from the fallacies listed below:

First and the foremost, the incentive is given to all employees on a collective basis, thereby implying that equal efforts are being put up by all the employees of the organization, irrespective of the nature of work and level of intellect that each individual possesses

Targets are set on the macro level which simply ignores the level of intricacies involved in a particular job



The list of parameters is not exhaustive. There are no parameters to measure the performance of few departments. This means the people working in these departments enjoy the benefits of the incentive without contributing anything to the achievement of the MoU targets.

Weights for certain parameters are imbalanced. Certain parameters are given excess weightage and are repeated more than once, which mars the strength of the system

Few of the parameters measure no specific or concrete outcome. At the same time, certain parameters focus only on quantity and neglect the quality

Unit level targets are not integrated with the corporate’s overall strategy

The MoU targets based incentive system gives short term orientation to the organization. Employees are more concerned about achieving the current year’s targets instead of focusing on the impact of their today’s decisions on the future growth of the organization

Meeting MoU targets may not lead to the maximization of the firm value. Firm value is maximized when the shareholders’ wealth increases. But the system does not acknowledge this fact.

The parameters fail to provide enough motivation and challenge to the employees of the organization

Despite that fact that the Projects Division is the driving force of the organization, the parameters are skewed towards ID&A division, which reflects imbalance in the selection of the parameters as well.

The current system, thus, leaves many gaps, which need to be plugged in a way that performance of each individual is captured and the incentive is paid to every individual on the basis of his and only



his efforts. Each employee must realize the responsibility that he carries towards achieving of the targets. No efficient employee should be given less incentive because of any other employee who failed to perform. Every department and hence every employee must know how he is contributing to the long term growth of the organization. Incentive scheme, thus , needs to be based upon individual performance and such system will give enough motivation to all the employees to strive harder for their and hence the organization’s growth

“Work is not man’s punishment; it is his reward and his strength and his pleasure.” --George Sand

What motivates every human being in this world is the recognition the world gives to his achievement. The motivation tools could be many from money to gifts but to be honest every human being likes to get rewarded consistently by money for his consistent performance , that was the primary reason why the companies started paying the employees a part of the compensation in terms of variable payment based on their performance. Ultimately what becomes important is what you measure and how much weightage you add to it. Any incentive system should try to achieve the following objectives

1. Motivate the performers 2. Improve the performance of the company

The system should not facilitate the performers and non performers to be rewarded in the same manner; this will not only destroy the motivation level of performer and also will encourage non performance at every level of the organization. The paper provided here is an attempt to analyse the current incentive payment system in



PFC and suggest improvements keeping in mind the broad principles of motivational theory. The Existing System The existing system of giving incentives in PFC is based on the level of MoU targets achieved in the financial year. MoU targets are fixed for every year through an agreement between PFC and the Ministry of Power. Certain parameters, which indicate PFC’s performance, are selected and are given due weights. Targets for the current financial year are fixed keeping into consideration the views of the concerned employees. Actual achievements, at the end of the year, are compared against the targets. On the basis of these achievements, performance measurement index is calculated and the amount of incentive, to be given to each employee, is determined. This system of paying equal incentive to all the employees of the company ignores the extra efforts put in few employees and provides a blanket to the inefficiency of few other employees. Not every employee of the organization is aware as to what is the long term objective of the organization and how is he contributing to the growth of the organization. The existing system does not motivate the employees to improve the working of the organization. To summarize, the existing system suffers from the fallacies listed below:

First and the foremost, the incentive is given to all employees

on a collective basis, thereby implying that equal efforts are being put up by all the employees of the organization, irrespective of the nature of work and level of intellect that each individual possesses



Targets are set on the macro level which simply ignores the level of intricacies involved in a particular job.

The list of parameters is not exhaustive. There are no parameters to measure the performance of few departments. This means the people working in these departments enjoy the benefits of the incentive without contributing anything to the achievement of the MoU targets.

Weights for certain parameters are imbalanced. Certain parameters are given excess weightage and are repeated more than once, which mars the strength of the system

Few of the parameters measure no specific or concrete outcome. At the same time, certain parameters focus only on quantity and neglect the quality

Unit level targets are not integrated with the corporate’s overall strategy.

The MoU targets based incentive system gives short term orientation to the organization. Employees are more concerned about achieving the current year’s targets instead of focusing on the impact of their today’s decisions on the future growth of the organization.

Meeting MoU targets may not lead to the maximization of the firm value. Firm value is maximized when the shareholders’ wealth increases. But the system does not acknowledge this fact.

The parameters fail to provide enough motivation and challenge to the employees of the organization.

Despite that fact that the Projects Division is the driving force of the organization, the parameters are skewed towards ID&A division, which reflects imbalance in the selection of the parameters as well.



The current system, thus, leaves many gaps, which need to be plugged in a way that performance of each individual is captured and the incentive is paid to every individual on the basis of his and only his efforts. Each employee must realize the responsibility that he carries towards achieving of the targets. No efficient employee should be given less incentive because of any other employee who failed to perform. Every department and hence every employee must know how he is contributing to the long term growth of the organization. Incentive scheme, thus , needs to be based upon individual performance and such system will give enough motivation to all the employees to strive harder for their and hence the organization’s growth Proposed Incentive Payment system Under the proposed system, each unit in each division will prepare a balanced scorecard based on the functional responsibility of the unit. While deciding on the parameters under different perspectives the units need to decide on those parameters which would enhance the economic value added (EVA) for the company. The parameters and the Weightages and their target levels need to be discussed and decided by each unit through a brain storming session within the unit members. In the year end, based on their actual performance unit performance index (UPI) will be calculated. Incentive will be declared for each such unit based on the UPI level achieved during the year. The incentive for each unit will depend on the performance of the individuals who have been assigned the responsibility to achieve the target of one or few of the parameters stated in the balanced scorecard. The incentive for the divisional head

UPI = ∑ Weightage x Actual / Plan /100



depends on the divisional performance index which is based on the division’s balanced scorecard. A division’s balanced scorecard will be a summation of all major parameters from the unit’s balanced scorecards. So the incentive for the division depends on the unit’s performance. The incentive at the organizational level will be based on the organizational performance index computed base on the overall balanced scorecard devised for the company as a whole. The organizational balanced scorecard will contain all major parameters from each divisional balanced scorecard. The issues relating to operationalizing balanced scorecard based system has been discussed later. The following diagram explains the way balanced scorecard fits into the organizational structure, and the way it reaches out to every part of the organizational structure. Balanced Scorecard for PFC

OPI

DPI Projects

DPI F & FO

DPI IAD

UPI ALRM

UPI LD & R

UPI P & C

UPI FP

UPI CAT

UPI RMU



Balance Scorecard - the concept For very long time the organizations have been using financial parameters like ROCE, ROE as the divisional performance metrics to judge the performance of any particular division. Financial parameters are important but they are not the single most judgment factors judge performance. The dependence on the financial parameters to evaluate performance leads to following situations, for example company’s division A has been giving ROCE of 20% and the cost of capital of the company is 16% suppose a project comes wherein the ROCE is 17% which is more than COC but less than division’s ROCE the divisional head will shy away from taking up such projects because of the fear of ROCE falling down. Further the ROCE parameters are not adjusted for the accounting tricks that could be played by the accountants to artificially boost the profit level. One more disadvantage of using such financial parameter’s are in order to improve these ratios the manager’s would be forced to take decisions, those would benefit for short term, leaving away the long term performance of the company. To measure a divisions performance, the management need to look in to various other parameters like those related to customer satisfaction, continuous improvement in the business processes and scope for innovation for breakthrough performance. Balance scorecard does exactly the above mentioned, it is a tool which breaks the company’s overall vision in to operational parameters and groups them under four different perspectives namely Financial, Customer, Learning & Growth and Internal business. It is called “balanced” scorecard because it balances the performance



measure across various aspects of the business not just financial parameters. Under financial perspective the parameters generally would be those that will facilitate the shareholder to better judge the return which the company provides to them. Customer perspective includes those parameters that will improve the customer satisfaction in terms time, cost, service and delivery. Under the internal business perspective the wide parameters would be those relating measures taken to continuously improve the business processes those would result in cost reduction and faster customer service. The organization should also focus on the long term performance of the company, it takes several steps those would result in break through performance in the long run and may not provide returns in the short run, the manager’s should also be credited for such initiatives taken, such parameters form part of the learning and growth perspective of the balanced scorecard. Balance Scorecard @ PFC Before deciding on the parameters for balanced scorecard every organization should first develop a strategy map keeping in mind the organization’s vision and mission. The strategy map brings in the cause and effect relationship among various performance measures across the four perspectives. This enables an organization to identify how each of the department contributes to the company’s vision and mission. Those departments which do not contribute to the vision or mission can be scrapped. The strategy map breaks down from the financial parameters to learning and growth through a chain.



Once the measures to achieve the organizations objectives have been identified through the strategy map then putting them in to measurable parameters becomes easier. PFC’s strategy map is provided below

Strategy Map Strategy Map -- PFCPFCCash Flows EVA NIM

Transac.risk

Disbursements

COL

New Customers

DevelopNew Prod.

RecoveryRate

Reduce lossdue to Credit &

Rate risk

ReductionProj. app

Days Reducingthe impact ofrate changes

Sanctions

ForeignCurrency

Loans

ExistingCustomers

RupeeLoans

1. On Time San. Reform2. On Time Dis. Review3. Lending Rate

1. New Prod. to New Mark.

2. Existing Prod. to New Mark.

1. New Prod. to Existing Mark.

2. Existing Prod. to Existing Mark.

ReductionIn Cost ofborrowing

ReductionEntity. app

Days

On timeDisbursement

OnlineCustomerApplication

ElectronicClearingSystem

Integrated MIS inF & FOFinancial

Engineering

Value Proposition

Interest and Currency Rate

hedging

Northern

Southern

Western

North Eastern

IntegratedMIS

Training& Development

Credit riskMgmt system

FinancialInternal B

usinessC

ustomer

Learning

Bottom

Up A

pproach



the above exhibited strategy map clearly demonstrates how each department in the organization contribute to the maximization of EVA which is the single most performance measure used in most multinationals, and also other relevant financial parameters. For example how the company can maximize EVA is either through increasing disbursements or through reducing cost of funds. Disbursements can be increased through increased sanctions; this becomes the responsibility of the projects division. We can bring in additional projects through new customers or from new markets or from existing customers through retaining them. The decision to enter new markets depends on the organizational priorities which are depended upon the objectives set forth. Cost of lending could be reduced by low cost of sourcing, which becomes the resource mobilization department, which should always strive to beat the benchmark rate. Reduction in cost of lending also depends on the operation’s cost of the organization which relates to the productivity of the employees. Similarly every measure taken can be related to its cause and effect with other measures taken in the organization. All these measure should ultimately result in value maximization for shareholders. Suggested Balanced Scorecard Based on the strategy map devised for PFC, the performance measures taken under each of the perspective can be translated in to measurable metrics called Performance Parameters. The balanced scorecard for PFC should include all those major performance parameters relating to strategy map, which the board decides as priority. The performance parameters mentioned in the PFC’s balanced scorecard is further broken down to arrive at the divisional



balanced scorecard, the divisional balanced scorecard is broke down to develop the unit level balanced scorecard. Through the above process the unit level balanced scorecard gets integrated with organizations overall balanced scorecard. Suggested Balanced Scorecard for PFC Financial Perspective

Sl No

Parameter Measure Target Actual Wt.

1 EVA Rs. 2 Cash Flow Rs. 3 NIM % 4 Disbursements Rs 5 Sanctions Rs

Customer Perspective

Sl No Parameter Measure Target Actual Wt.

1 On Time Sanction

Project Sanction Days

2 On Time Disbursement

Days

3 Customer Satisfaction Index

Index

4 Reform Review of Entities

Positive affects of



reforms

5 New Production Development

% of income from new products

6 SEBs Meets No. of Meets

Internal Business Perspective

Sl

Parameter Measure Target Actual Wt.

1 PA Time No. of days 2 EA Time No. of days 3 Benchmark-

rk Rate / COB

Deviation from the economy rates

4 Net ef. Gain / loss due to rate change

Rs.

5 Recovery Rate

%

Learning and growth Perspective Sl Parameter Measure Target Actual Wt.

1 Training Mandays

No. of days

2 Integrated Date



MIS 3 ERP Date 4 Quality

Circles Quality of initiatives taken

5 Knowledge Management

Date

Balance Scorecard for Finance & Financial operations BSC – F&FO Financial Perspective Sl Parameter Measure Target Actual Wt. 1 Marginal

NIM %

2 Net Eff. Gain / loss due to rate change

Rs

3 Benchmark rate / COB

Deviation from economy rates

4 STL Targets

Rs

5 Recovery %



Rate Customer Perspective Sl Parameter Measure Target Actual Wt. 1 On Time

Disbursement Days

2 Reduction in COL due to reduction in COB

Gain to Customer in Rs.

3 New Products STL

Number

Internal Business Perspective Sl Parameter Measure Target Actual Wt. 1 No. of

disbursement claims / employee

Number

2 One time interest payments

Date

3 Negative Gap

4 Reporting Dates

Date



Learning & Growth Perspective Sl Parameter Measure Target Actual Wt. Corporate

Governance No. of Mandays

Training Mandays

No. of Mandays

Integrated MIS for RM, LDR & ALRM

Date

Suggested Balance Scorecard for ALRM Sl Parameter Weight

age Target Actual

Financial Perspective Marginal NIM Net G/ L due to rate change

3 3

90 % 90 %

80 % 120 %

Customer Perspective

Internal Business Perspective Liquidity Gap Reports generated

2

100

75



1 15th Mar 12th Mar

Learning & Growth Perspective Training Mandays

1

100

100

TOTAL 10

Operationalizing Balanced Scorecard Each unit should submit their balanced scorecard to the HR division or strategic planning division ad also to the board of directors. The HR division or strategy division should prepare its comments relating to the importance of the parameter as well as w.r.t to the planned level, whether it is stressful. The meeting of BOD should be arranged and the approval for the balanced scorecard needs to be obtained. In the year end the performance index calculations should be made by the HR division or strategy division and submit it to board for incentive declaration. Conclusion If the balanced scorecard based compensation system is initiated it will overcome the entire shortcomings highlighted in the current MOU based compensation system. It would act as a report card to measure the performance of the organization and enable PFC to reward only the performers.



Q4E-2005

Team: Amod Agrawal

Savitri Srivastav Sandeep Puri

Organisation : NHPC- CC, IT Deptt.

Title:

Roadmap for Radical Performance Improvement – Leveraging ICT for Integrating Business Process



ABSTRACT

NHPC, a premier public sector organization in the Hydro-power sector, has embarked upon an ambitious IT plan to integrate and supplement its business processes necessitated by renewed thrust on Hydro Power by Govt. of India through Prime Minister’s programme for additional capacity addition of 50,000 MW. The pace of changes has been fastest in the field of Information Technology. By leveraging Information Technology the organizations can be taken to new heights. The resources are required to be optimized to maintain the competitiveness of the organizations. However, there is always a limit in the process of optimization. Radical rethinking is required to redesign and re-engineer the existing processes and IT has a major role to play here. IT is not just a support function now, it is major enabler in transformation of the organizational activities. IT Division at NHPC had always been pioneer in adopting new technologies since its inception. It decided to have VAX-11/780 computers and ORACLE as the corporate database way back in 1985, when very few people in India had heard about them. In line with its progressive and path-breaking policies, IT Division has prepared a Road Map to lead the Corporation for its future growth plan.



NHPC: A BRIEF INTRODUCTION

National Hydroelectric Power Corporation Limited (NHPC), A Govt. of India Enterprise, was incorporated in the year 1975 with an authorised capital of Rs. 2000 million and with an objective to plan, promote and organise an integrated and efficient development of hydroelectric power in all aspects.

At present, NHPC is a schedule 'A' Enterprise of the Govt. of India with an authorised share capital of Rs. 1,50,000 million. With an investment base of over Rs. 2,00,000 million, NHPC is among the TOP TEN companies in the country in terms of investment.

Initially, on incorporation, NHPC took over the execution of Salal Stage-I, Bairasiul and Loktak Hydro-electric Projects from Central Hydroelectric Projects Control Board. Since then, it has executed 10 projects with an installed capacity of 3685 MW on ownership basis including projects taken up in joint venture. NHPC has also executed 3 projects with an installed capacity of 79.35 MW on turnkey basis. Two of these projects have been commissioned in neighbouring countries i.e. Nepal and Bhutan.

During the financial year 2004-2005, NHPC Power Stations achieved the highest ever generation of 11286.43 MU and a sales turnover of Rs. 16682.7 Million with a Net Profit of Rs 6845.8 Million.

Presently NHPC is engaged in the construction of eleven projects aggregating to a total installed capacity of 5103 MW on ownership basis and two projects totalling to 10 MW on turnkey basis.

NHPC is registered as a “Consultant” with World Bank (WB), Asian Development Bank (ADB), African Development Bank (AfDB),



Kuwait Fund for Arab Economic Development (KFAED), Central Water Commission (CWC) and Consultancy Development Centre (CDC).

GROWTH PLAN OF NHPC

Despite the fact that Hydroelectric Projects are recognised as the most economic and preferred source of electricity, share of hydropower in the total installed capacity in India had been declining steadily since 1963. In order to reverse the trend and given the renewed thrust on hydropower by the Government, NHPC has drawn up a massive capacity addition plan to add over 15000 MW of hydropower capacity by the end of XIIth plan (Year 2017).

KEY PERFORMANCE INDICATORS FOR BUSINESS PROCESSES

Considering the two primary business objectives of NHPC i.e. development of hydro projects and generation of electricity, the following are the key performance indicators for integrated business processes in NHPC:

Commissioning of new hydroelectric projects without any cost and time overrun.

Ensuring target capacity availability and target energy generation from power stations as per MOU.

Effective and efficient management of all resources. Increased level of profit margins.

ICT FOR BUSINESS PROCESSES IN NHPC



Information and Communication Technology (ICT) has been identified as one of the most important technology enablers in NHPC for achieving corporate goals of efficiently executing and maintaining hydro power projects. In this regard, a necessity was felt to draw a Strategic Plan for IT and Communication for organization for coming years. The Strategic Plan links IT initiatives in the organization to short-term and long term corporate objectives. It also defines and organizes priorities and establishes timing for the implementation of necessary changes to NHPC’s IT infrastructure. The following are the IT vision and IT Strategy of NHPC: IT VISION Establish NHPC as Leader in the optimum Use of Information Technology and Systems for accomplishing Corporate Objectives in Power Sector of the Country. IT STRATEGY IT Strategy Plan for NHPC has been drawn up, with a basic promise that IT shall play a major role as a technology enabler to achieve corporate goals and objectives. The IT backbone that has been envisioned now for this organization, is expected to revolutionize the way we carry out our business today and shall equip NHPC adequately to meet future challenges and opportunities by adopting following approach:

Assist in accelerated implementation of projects and avoid cost and time overruns

Assist in maintenance of operational projects to ensure high machine availability



Assist in effective management of resources Facilitate decision making process by providing improved

quality of information EXISTING INFRASTRUCTURE With an elaborate IT and communication infrastructure in place since early eighties, it has been possible to bring major functional areas such as Design & Engineering, Project Management, Finance & Accounts , Human Resource Management, Commercial Management, Power Plant operations etc. under the gamut of Computerisation. COMMUNICATIONS FACILITIES A three-tier satellite communication system comprising LDST, INMARSAT and VSAT has been implemented in NHPC for fail-proof communication. Of these, the VSAT communication system is envisaged to be developed for full scale networking application for interconnecting PCs and PC-based LANs besides voice and facsimile applications. Accordingly, 33 locations are already connected and action is on for another 26 locations. This is supplemented by LDST telephones (14 already in place, 8 under procurement) and INMARSAT based Mini-terminals (30 in place, 21 under procurement). STRATEGIES FOR INFORMATION SYSTEMS Considering the key business Processes of the corporation, the strategies for Information Systems have been adopted as below:

Use ORACLE RDBMS as Corporate database environment with suitable



Front-end tools 3-tier framework with Web enabled user interface Distributed computing with data replicated in Corporate

database Seamless integration of applications across all major

functions/locations Business application software to be developed using In-house

capabilities with minimum outsourcing wherever required

Implementation of ERP solution in a phased manner Most of the software packages developed in-house Power Stations/ Projects/ R.O./ L.O have been brought under

computerization process Outsourcing for specialised packages



INNOVATIONS IN THE USE OF ICT FOR BUSINESS PROCESSES

Implemented Enterprise wide computer network, comprising

of more then 2500 nodes spread across geographically remote sites

A 4 tier communication structure in place to provide for fail-safe communication channels with the remotely located sites of the organisation.

Use of Internet for publishing tenders and bids for wider publicity and transparency

Powerful Intranet to provide not only the backbone for information dissemination but also as a tool for work flow automation and work collaboration.

A change in work culture of the organisation leading to a spirit of collaboration between various functions

Greater transparency in the organization

Turn around time for employee centric processes reduced to almost 20%.

Successfully codified for the first time the complete inventory of spares and store items numbering about 1.7 lakh

Optimizing the inventory holding at the various projects

resulting in saving of crores of rupees



A deep commitment to the Project Management philosophy, for construction of hydro projects with no time and cost overruns

Almost 40 to 50% reduction in construction time of hydroelectric projects resulting in savings of more than 1000 crores

Internal exercise carried out successfully to map all business processes which will result in a saving of 3-4 years when implementing ERP in the organization

A first time attempt is being made to run a number of stages of ERP implementation concurrently and complete it in 3 years

KEY I T INITIATIVES AND INFORMATION SYSTEMS IN NHPC

MMS (MATERIAL MANAGEMENT SOFTWARE) The main objective of the Materials Management System is to optimize and manage vast inventory of NHPC, this includes the following:

• Obtaining the best value for purchased materials. • Assuring supplies are on hand when and where required. • Reducing inventory to the lowest amount required. • Assuring quality requirements are met. • Providing efficient, low-cost movement of supplies to the site

and within site storage areas.



The MMS Package aims at automating all the processes involve in purchase management, inventory management and stores accounting in an integrated manner It was is planned in 2001 and It is commissioned in 2002 with approx inventory of Rs. 1.8 Crores EDMS (ELECTRONIC DOCUMENT MANAGEMENT SYSTEM) EDMS envisages on line authorized access and availability of digital images on all NHPC authentic records at right desk and at right time. On line authorized access of authentic records and its digital image in need fulfills instant demand to refer copy and records then and there. EDMS is web enabled are inavailable all over NHPC’s WAN / LAN. It was commissioned in 2004.

The EDMS has been implemented on NHPC WAN/LAN and accessibility of the server from remote locations has been verified. Access of documents on internet is pending in view of security measures under implementation.

ORACLE BASED SOFTWARE APPLICATIONS The objective of the project was to introduce automation in key functional areas of the corporation using Oracle as backend database and D2K as development tool. Project included computerization of the processes automation covering following functions:

• Finance and Accounts • Human Resource • Construction Management System. • Energy sales & Accounting System • Power Generation Information system



• Construction Equipment Planning. It was planned in the year 1998 and was commissioned w.e.f.April 2000. All the functional Divisions of NHPC at Corporate Office and Projects/Power Stations are these applications. INTERNET WEBSITE Objective of the project is to provide information regarding various functional areas of NHPC including Overview, Projects Construction and status of development activities, Commercial activities and future plans including providing information on NHPC like Company Profile, Projects, Generation, Financial, Commercial, Consultancy, Performance, Tenders etc, Recruitment, Environment Issues, Rehabilitation Issues etc. It was Planned in April 1998 and Commissioned in November 1998. Website has been developed in both English and Hindi. It is being regularly updated as per the latest information received from various divisions and projects which include tenders/bids etc. Presently it is under redesigning. All the venders, suppliers institutions associated and interested in the Hydropower development in the country and society at large are benefiting for this Benefits imparted through the projects in terms of productivity, cost cutting, ROI etc. Worldwide publicity for NHPC. Instantaneous access of information on NHPC. INTRANET The main purpose of an intranet is to share company information and computing resources among employees and disseminate information



amongst various Divisions and Departments. It Include/providing information on NHPC like

• Personal Details • T&HRD Information • Library Information • Attendance • Manuals • Organization Culture etc. • Tenders etc. • Internal Orders

It was Planned in December 1999 and Commissioned in May 2000. The Management and the Employees of the Corporation at Corporate Office and Projects are benefiting for this purpose. IT TRAINING AND DEVELOPMENT Training of users on new tools and technologies in the area of IT is a continuous process. Refresher courses and advanced courses are conducted at regular intervals. Computer labs are being established at Corp. Office and Projects for conducting IT related training programmes. Establishment of web based LMS with online learning modules is at the planning stage. BUSINESS CONTINUITY PLAN NHPC maintains a detail BCP. NHPC is in the process of ISMS (Information Security Management Systems) implementation leading to BS7799 certification. The business continuity management is a part



of ISMS implementation. Based on ISMS, detailed Business Continuity Plan shall be drawn and adequate measures shall be taken to put BCP in place. BCP shall include adequate IT standby arrangements at remote locations also.

ICT FOR BUSINESS PROCESSES : NEW INITIATIVES

As stated earlier, NHPC has drawn up a massive capacity addition plan upto XII Plan totalling 31,489 MW upto the year 2017. With this gigantic task in hand, NHPC is poised to consolidate its position as the largest single hydropower utility in the country. NHPC also plans to take up hydropower projects in neighbouring countries like Nepal, Bhutan, Myanmar, etc in near future thereby making its international presence. It is the considered view that such targets and challenges for NHPC necessitate organisational transformation and certain processes re-engineering initiatives are required to be set in motion. Essentially this exercise involves reassessment of all the existing processes/systems/procedures corresponding to major and critical business functions of NHPC and benchmarking them to that of international practices. This also brings into sharp focus the processes requiring improvement and explore the possibility of adopting global best business practices covering key functions. The other considerations for taking up such exercises are:

NHPC shall be required to adopt global best business practices covering the key functional areas to remain competitive in the current Indian economy as a whole and power sector in particular. Also the performance of the some of the existing business process shall have to be improved to maintain steady growth in terms of income and profit.



All key activities being undertaken by NHPC for hydropower development such as, Project Investigation and DPR preparation, Project Clearance, Award of Contracts, Design and Engineering, Construction Project Management are required to be performed in the most integrated and collaborative manner to meet the corporate policy of construction and commissioning of major projects in 4-5 years time frame.

NHPC is essentially an asset intensive organisation and hence tracking of all activities related to creation, commissioning, capitalisation, maintenance, utilisation, renovation and modernisation and decommissioning of all major assets of the organisation is of paramount importance. • With the implementation of Availability Based Tariff

(ABT) in recent times, it is imperative to maintain the generating plants and equipments in the best possible manner so as to meet the regulatory requirements.

• NHPC is also focussing on controlling and managing cost of the construction projects and power stations to reduce cost overruns and its consequential impact on tariff.

• The management shall require information on key performance indicators and critical success factors of the organisation on real time basis.

• Information should flow seamlessly across the organisation between project / power stations and Corporate Office and between key functions.

• Collaboration with suppliers, contractors and beneficiary States/power trading companies beyond organisational boundaries.



• A robust, scalable and enterprise-wide information systems supporting the key critical business processes in the most integrated and seamless manner affording organisational benefits that range from increased efficiency to sustained improvement of quality, productivity and profitability.

Keeping the above considerations in view, NHPC has created an information infrastructure, which has empowered the organisation to meet the challenges by deploying enterprise wide software applications of the organization using Oracle as backend database and D2K/web based front end. NHPC has also initiated activities to migrate to Enterprise Resource Planning (ERP) System and add-on/complimentary solutions covering following broad key business functions:

• Project Management (from planning stage to

commissioning stage) • Assets/Plant Maintenance and Operations • Procurement and Contracts • Engineering and Quality Assurance • Human Resource Management • Finance & Accounts • Energy Sales and Accounting • Environment and R&R

APPROACH AND METHODOLOGY FOR ERP IMPLEMENTATION

Steering Committee headed by CMD/Director to monitor the

ERP implementation process.



Constitution of Core Committee on ERP comprising of functional experts from Divisions in C.O./Projects/Power Stations covering key functional areas to :

• Provide functional requirements during the study stage.

• Approve broad functionalities of each major business function/process.

• Provide professional inputs during the implementation of ERP.

Visit to reference sites by Core Committee members in the country and abroad to gain first hand knowledge about ERP implementation and benefits.

OTHER MAJOR INITIATIVES In recent past NHPC has taken following major IT initiatives towards exploitation of IT for certain business processes and associated function:

IT SECURITY NHPC is in the process of Information Security Management System (ISMS) implementation at Corporate Office. A consultancy agency has been appointed for guiding ISMS implementation leading to BS 7799 Certification. As part of ISMS implementation, based on vulnerability analysis and penetration testing adequate security is being provided to IT Setup of NHPC against internal as well as external threats. Requisite Hardware and Software technologies and solutions are being deployed to minimize / mitigate security related risks.



SUPERVISORY CONTROL AND DATA ACQUISITION (SCADA) Objective of the project is to install the Automation and SCADA system at the Bairasiul, Loktak, Salal, Tanakpur, Chamera-I and Rangit Power Stations and the SCADA system at the Uri Power Station and Corporate Office, Faridabad. It is likely to be commissioned in two years at all O&M Power Stations.

• The command given to the computer-based system is subjected to the plausibility check to filter out any wrong information.

• Automation and SCADA system shall allow better supervision and fail-safe operation of the powerhouse. It will also provide an alternate means of plant operation.

CMMS (COMPUTERIZED MAINTENANCE MANAGEMENT SYSTEM) The objective of the package is to enable NHPC effectively maintain generating plant and equipment and other Assets at its Power Stations in a most optimum manner in terms of cost and generation loss. Computerized Maintenance Management System has been planned for meeting business objectives like reduced maintenance cost, minimal disruption of generating schedule and for adopting globally accepted best practices in the area of maintenance management. It is likely to be commissioned in March, 2007 All O&M Power Stations are the beneficiaries of the project.



CONCLUSION

Today’s highly competitive business environment demands that each organisation streamline and optimize the key processes which critically influence accomplishment of corporate goals and objectives. Enterprises have leveraged information technology and cutting edge solutions provided by it for shoring up their bottom line. An its seamless integration of all processes connected across the organisation is one such example. In NHPC, implementation of the automated packages in key functional areas and subsequent sustenance of the same for more than 2 decades now has been possible because of unstinted commitment of NHPC’s management and also willingness to change and realization of benefits by the personnel associated with the key process. The positive signals of benefits are already perceptible. Encouraged by the results, NHPC has already commenced work for rolling out the within next three years. Though the timely and accounts flow of information which is taking place across the organisation.



Q4E-2005

Participating Team: Mohd. Afzal Ali Kumar Vivek Kanti Swarnakar

Organisation : NHPC- CEP Division, Faridabad

Title:

Construction Equipment Management for Fast Completion of Hydroelectric Projects



ABSTRACT : In the construction of Hydro Electric Projects, effective management of the construction equipment as well as the methodology of construction plays vital role in timely completion of the project. As we are aware that the cost of construction of a Hydro Electric Projects is quite high and the cost of construction equipment involved is around 20 % of the total construction cost of the Project. Therefore it is necessary to adopt suitable construction methodology for construction which can change the total scenario for the completion of the projects. Since each Hydro electric project is unique and its design is totally dependent upon site & geology, an effective methodology is very much required for speedy and successful completion of the projects. Gone are the days when completion of a Hydro Electric project was uncertain. Now a days if proper methodology coupled with high technology is adopted, the Hydro Electric projects can not only be completed within schedule time but some times ahead of schedule, in spite of all geological uncertaintities. NHPC has created various mile stones for completion of projects in record time and sometimes ahead of schedule e.g. successful completion of Devighat H.E. Project, Nepal in record time of three and a half year, Successful commissioning of Kurichu H.E. Project ahead of schedule etc. Considering high demand of Power, the nation is bound to construct/execute to produce Mega Hydro Electric Projects. To meet this challenge radical change is required in our construction methodology and a fleet of advanced technology equipment is required to be identified. This paper is basically aimed to highlight the improvement in the existing methodology & introduction of high technology equipment in construction of Hydro Electric Projects so that a revolutionary change can be brought in for fast & successful completion of H.E. Projects with quality & safety.



In this paper the specific methodologies have only been discussed which are very advance and give revolutionary results. Road Map for Fast Construction of H.E. Projects Excavation (i) Surface Excavation: In General surface Excavation, normal procedure for excavation is adopted which is fruitful only in the case where less Excavation & Backfilling are required. In case of River Bed Excavation where the Foundation rock is at very deep level and huge quantities of excavation & Back filling are involved the construction of cut off wall with the help of trench cutting machine should be adopted. Trench Cutting machine The formation of cut off wall reduces huge amount of excavation, which results in enormous saving of Money as well as Time. The wall provides very effective control of seepage of water from the Dam



Body. The Cut off wall is constructed in the upstream of Dam. Hydra Mill machine is used for Excavation as well as Concreting. This technology has been introduced for the first time in India by NHPC at Dhauliganga H.E. Project and subsequently followed by DMRC. (ii) Under Ground Excavation : (a) Drill Blast Method : Drilling : Computerized Drilling Jumbo As we know that Drill Jumbo gives very fast drilling rate in comparison to conventional Jack hammer drilling. But now a days time has come where even more efficient method is required to get faster rate of drilling with high level accuracy. For this, Computerized Drilling Jumbo should be used. In Computerized drilling jumbo, pattern is once fed and the machine automatically locates the pattern and drills the hole. This method provides accurate drilling and consequently perfect profile is generated after blast and the under cuts & over cuts are minimised to great extent. This way it saves further time & cost as under cuts & over cuts are minimized. In the case of under cut further cutting is required which causes loss of time as well as money. Similarly, in the case of over cut further concrete filling is required that also involves extra cost & time.

DRILLING JUMBODRILLING JUMBODRILLING JUMBO



Laser Technology Laser Technology should be used during drilling to check & maintain the alignment of the tunnel in progress. Misalignment of tunnel may lead to failure of proper tunneling & can create great hazard also if the misaligned excavation moves to nearby weaker zone or water borne strata/area etc. This Technology will save money, time & unforeseen circumstances. This method shall facilitate to solve the problems which were faced in NHPC’s Dulhasti Project. Blasting : Non Electrical Detonators Normally conventional electric blasting method requires much time for making connection in all the holes which results in slow progress rate of blasting. To save the time in blasting Non Electrical Detonators should be used. These detonators are costlier but where time is major constraint, it is very effective in time saving. The Non-Electrical detonator is fed during drilling of pattern itself. These detonators also provide safe environment, which is of great concern in H.E. Projects.

Comparison showing saving in time with Non Electrical Detonators

(In the 50 sqm face area tunnel per 3 m stretch ) Activity Time Time involved in

Electrical Detonators. Time involved in

Non-Electrical Detonators

Drilling 3.36 Hrs 3.36 Charging 1.5 Hrs 0.5 Hrs

4.86 Hrs 3.86 Hrs.



Above data clearly indicates 1hr saving in per 3m stretch of tunnel of 50 sqm face area. Loading & Mucking: Conventionally, for underground work Excavator is used for mucking which takes much time especially where limited path for movement of the equipment is available. As such, Side Dump loader of approx 2.5 times bucket capacity in comparison to Backhoe Loader can be used in same space. This clearly shows that output has increased 2.5 times. For very constricted path like surge shaft/ Pressure shaft, Skid Steer loader should be used. The skid Steer loader has independent motion in wheels and hence moves in very less space. Similarly for mucking in low height tunnel Load Haul Dumper should be used which can easily move in low height space also. Besides it, for limited space where reversal of hauling equipment is difficult, Reversible Dumpers should be used in which there is no need to reverse the Dumper inside the tunnel. Pre- Excavation Stabilization of Poor Rock: In case of poor Rocks of Class IV and V where there are risks of over breaks, collapses or material inflows immediately after the excavation, the tunnel should be pre stabilized. This stabilization is of prime concern and it not only saves time from interruption in further progress due to collapse but also saves a lot of money invested in mucking & filling of these over breaks. Therefore in place of conventional method following two special methodologies should be adopted to deal with excavation in poor Rocks of Class IV & V.



(i) Fore Poling: Once the class IV rock is encountered during excavation of tunnel, fore poling should be adopted. In this method, drilling is done and steel rods are inserted & grouted which gives very high class extra support to loose rock. After the Fore polling, the excavation of desired part can be done easily.

Fore Polling (ii) Pipe Roofing: This is more advanced way of dealing with extremely Poor rock. This should be adopted normally for Class V Rocks where after drilling the hole it is even difficult to sustain the rock for insertion & grouting of steel rods. Therefore for such type of rock, drilling & insertion are required simultaneously which are done through pipe roofing. Vertical Drilling:

Rotary vertical drilling System (RVDS) equipped Raise borer Construction of vertical shaft is one of the most critical activities of the project. Misalignment of vertical shaft is of great concern in Hydro electric projects. Misalignment not only results in loss of money & time but also sometimes due to constraints of space entire layout is required to be changed which is very expensive & time consuming. To avoid this misalignment problems, Rotary vertical



drilling System (RVDS) equipped Raise borer should be used for vertical drilling. RVDS is a directional drilling tool for controlling the deviation of Pilot Holes to make exact Pilot/drill holes. It works with the principles of outer steering and is screwed on at the end of the Raise bore String. RVDS system ascertains the actual inclination of the tool in the bore hole through two accelerators and the inclination is transmitted electronically in the tools and senses for correct direction and with a hydraulic system four outer single ribs on a non rotating sleeve can be driven in or out to correct the direction of the hole.

Raise Borer

Concreting Shuttering:

Conventional shuttering requires again and again positioning & alignment of the gantries which consumes lot of time & labour and gives very less progress. Therefore in place of normal shuttering, following shuttering should be used which saves time, labour and provides fast progress:



(i) Needle Form Continuous Gantry: This Gantry should be used in Horizontal Tunneling. In this Gantry concreting of overt & invert are done simultaneously and also continuous concreting can be done. In continuous concreting the gantry is fixed once. After concreting of some panels, the first panel automatically gets sufficient setting time and by then it can be displaced and moved further to new position without any interruption in the concreting. Thus with the help of continuous gantry no extra time is required as setting time in individual panel and concreting can be done continuously resulting in higher progress rate and saves time & cost which shall be involved in again and again aligning of gantry with respect to previous. Continuous Gantry (ii) Slip Form: This gantry should be used for vertical

shuttering. This is also a continuous type shuttering and after concreting at one place it only requires to slip forward for further concreting. This type of gantry has been used for the first time in



India by NHPC at Chamera Power station for the construction of surge shaft.

Comparison showing saving in time in concreting with Continuous Shuttering

(Considering 30 meter length in Horse shoe shape Tunnel of Dia 6.5 m) Activities Conventional

Shuttering (3 shutters of 10 meter length each using 2 shutters at a time)

Continuous Shuttering (5 shutters of length 6 m each)

Dismantling of Traveler

3x4 =12 -

Shifting form work to the new location

3x2=6 -

Cleaning & Alignment

3x2=6 -

Bulk head fixing and Preparation for concreting

3x4=12 -

Removing & fixing of panel & preparation for concreting

- 5x1.5=7.5

Concreting 3x7.1= 21.3 5X4.25=21.25 Total time 3X19.1=57.3 Hrs 28.75 Hrs



Considering effective working of 18 hrs per day and 25 days per month, monthly progress for Conventional shuttering: 235.6 m/month Continuous Shuttering : 469.5 m/month Dam Concreting:

Top Belt Conveyor along with Creter Crane For mass concreting in the Dam, it won’t be fruitful to go with the conventional method of cable ways/ travel tower crane, Top Belt Conveyor along with Creter Crane should be used to get very fast rate of concreting and thus saving time as well as cost. The output rate of Top Belt conveyer is more than double that of the conventional cable ways. The conveyor alignment can be adjusted as per the requirement. Top Belt conveyor consists of Tower crane & Belt conveyor and therefore as per requirement the tower crane can also be used as service crane while concreting is not being done. The erection of Top Belt conveyor is easier and less cumbersome in comparison to Cable Ways.

Top Belt Conveyor



Following illustration will clarify the output rate: For 35 Ton Cable Ways : Maximum Bucket Size - 9 Cum Cycle time - 4 Min. No of Cycle per Hour - 15 Concrete handling/hr - 15X9 = 135 cum/hr Top Belt Conveyor: Concrete handling/hr - 300 Cum/hr

Creter Crane

The Creter crane should be used as a supplementary concreting especially where access for concreting through Top Belt Conveyor system is not possible. The creter crane is a mobile crane with telescopic conveyor system in place of Boom.



(b) Drilling Blast Method to Tunnel Boring Machine (DBM to TBM):

Drilling Blast method is conventional method which is widely used for the construction of H.E. Projects. DBM method is cheaper also as such with the adoption of above mentioned revolutionary/radical change in the sequential methodologies of DBM, a very high quality output with huge saving of money & time is achieved. The time has come now when it is prudent to switch over from DBM to TBM especially for the tunnel where there is no provision of adits. Besides above, following parameters shall clearly explain ultimate benefits of adopting TBM.

Tunnel Boring Machine Benefits of adopting TBM

Faster advance rate results in savings in cost.

Continuous Production.



No Explosives Used for excavation - Safer Working Conditions.

Little or no over break results in large savings in final cost of

lining.

Less personnel & site establishments.

Lower initial ground support cost.

Less environmental hazard & damage to existing structures. Mucking from Loco which results in fast mucking with less

pollution. Considering above benefits NHPC has proposed Inclined TBM first time in India at Parbati H.E. Project Stage-II. Core Competency: Now a days, construction work is being done by outside contractors in lieu of departmentally. Award of work takes a lot of time because it is done after obtaining so many clearances etc. Therefore, it is suggested to do some works like Construction of Diversion Tunnel, Portal, adits, etc departmentally. These works should be taken as core competency of the organization. By the construction of above core competency works, major construction works of the project can be started immediately after the award of contract for major works. This will develop expertise as well as save time for completion of projects. Concurrent Activities: During Construction equipment planning, special attention should be given on the concurrent activities for speedy completion of projects with optimum utilisation of the equipment. For example, if works are going on two faces of the tunnel, then one face should be planned for



drilling and the other face should be planned for mucking. Similarly various other works should be planned in parallel to save time & cost of keeping additional equipment. Contingency Plan/Alternate Equipment: During construction of H.E. Projects many times unpredictable events occur and as such Contingency plan should be made to face these situations. Under this contingency plan, alternate arrangement of equipment must be done prior to start of construction because if we won’t be ready for this alternate arrangement this may lead to uncertain delay of the project. In spite of prior prediction of Rock condition, sometimes situation comes where blasting is not permitted due to other constraints like rock condition, environmental concern, crossing of nearby populated area etc. Therefore, to overcome these constraints, alternate arrangement should be made. For example some of the following arrangements should be kept ready. (i) Availability of Equipment : Some of equipment like Rock Breaker & Rock Splitter should be kept ready under contingency plan. These equipment should be immediately utilised where ever blasting is not permitted. (ii) Arrangement of identified agency for Cable Anchoring : Sometimes due to development of instabilities in the rock, it is required to go for cable anchoring of the unstable portion. So identification of specialized agency for cable anchoring should be done in advance. By Cable anchoring additional support is provided



to the excavated rock (in which movement is observed) with the parent rock which is quite far from the excavated portion. Specialised Agency : In the construction of H.E. Projects some works are very critical and hence need special attention for successful completion of Projects. Otherwise, projects may get delayed up to uncertain time. These critical & specialized works should be done by specialized agency only. These activities should be clearly indicated in the Bid Documents so that the Contractor can complete these specialized works through specialized agency only. Theses works are Rock Bolting, Pipe Roofing, Water Supply & Sewerage System, Architectural works for Power House & Dam Sites, Trench cutting/cut off wall, Raise Boring. Monitoring Instruments etc. Environmentally Friendly Equipment to Control Emission: H.E. Projects require lot of underground excavation works in which several construction equipment are involved. To maintain hygienic environment, special attention should be given for selection of environmentally friendly equipment to control pollution. This will give a very efficient working condition in the work place and save the persons involved in the work from poisonous environment generated through emissions from equipment. Safety: Hydro power plant is generally constructed in remote and rough terrain locations and in such tough location the equipment is transported, commissioned, operated and maintained. Safety aspects should be primarily considered right from transportation of these



equipment till commissioning, operation & maintenance. Utmost safety measures and safety gadgets should be used in H.E. Projects since normally H.E. Projects has to face very high level of natural uncertainty in the remotest locations. A distinction must be made between Efficiency & Productivity. Unsafe methods may reap financial reward for time being but in the long run it will result in production loss due to inevitable damage/accident. However, efficient methods of working taking into account all foreseeable circumstances, accidents etc shall ultimately give a great rise to quality products. The safety of the human being should be the highest law.



Summary:

The basic purpose of this paper is to switch over from

conventional way of construction equipment management to new trends so that a revolutionary or radical change in the construction of H.E. Projects can be achieved. Now a days development of H.E. Project is very essential since our country is facing acute shortage of Power Supply and the country has made a vision to supply the Power to each and every corner of the nation in coming years. Our country has a great potential of Hydro electricity which is cheaper, pollution free, having very less operational and maintenance cost and is only solution to meet our peaking demand. As we know Hydro electric projects are made in tough and arduous hilly terrain and construction of projects involves many unforeseen circumstances that results in uncertain delay of projects. Delay of projects not only creates power shortage but also blockage of huge amount of money involved in the construction of H.E. Projects. In this paper, latest methodology, advanced equipment, versatile planning etc have been highlighted. Improvement in each and every activity of construction has been highlighted and implementation of suggested methods will result in ultimate saving of time as well as money and without any time or cost over run, the Hydro Electric projects can be completed within schedule time or even ahead of schedule.



References: (i) Heavy construction planning, equipment and methods

(Second edition) Author: Jagman Singh. (ii) Construction, planning, equipment and methods (Sixth

edition) Author: Peurifoy / Schexnayder (iii) Detailed project reports of various NHPC projects. (iv) Latest magazines and journals.



Brief on Power HR Forum

1. Origin & Setup: The Power HR Forum has been promoted to provide a platform for sharing of expertise, capabilities, exploring best practices towards building professional competence for better management of Human Resource in Indian Power Sector. It is registered under ‘The Societies Registration Act, 1860’ [Regn No S – 52771 of 2005]. Following are the member organizations:

1. Bhakra Beas Management Board (BBMB) 2. Damodar Valley Corporation (DVC) 3. North Eastern Electric Power Corporation Limited (NEEPCO) 4. National Hydroelectric Power Corporation Limited (NHPC) 5. NTPC Limited (NTPC) 6. Power Finance Corporation Limited (PFC) 7. Power Grid Corporation of India Limited (POWERGRID) 8. Rural Electrification Corporation Limited (REC) 9. Satluj Jal Vidyut Nigam Limited (SJVN) 10. Tehri Hydro Development Corporation Limited (THDC)

2. Vision & Objectives:

The vision of the Forum is “Serving Indian Power Sector Through Excellence in HR”. Some of the important objectives of the Forum, are as under:

• Provide a platform for exchange of ideas and sharing of

experiences amongst member organizations. • Promote diffusion of Knowledge in HR. • Establish network of HR Professionals.



• Provide HR consulting and assist member organizations in outsourcing such services.

• Develop standards of performance for HR Services. • Collaborate with professional bodies within the country and

abroad. • Assisting member organizations in designing, developing

projects on Corporate Social Responsibility. • Institute awards for organizations and individuals. • Organize competency development and skill building Training

Programs, Seminars and Conferences on HR issues. • Promote e-enabled applications in HR. • Study, Review and Recommend personnel Policies, Procedure

and Guidelines. • Create a library of relevant Enactments/ Regulations, Personnel

Management, Industrial Relations. • Provide for documentation and publication of Journals,

Research papers and Books. 3. Initiatives taken by the Forum: 3.1 Website of the Forum:

www.powerhrforum.org is the website of the Forum showcasing the unique initiatives and providing a medium for information dissemination and exchange.

3.2 Sharing of Facilities:

Consensus has been reached amongst members to make available each other’s established infrastructure and facilities for use by all. These are:



• Schools – The schools of members will accept wards of other’s employees at no extra fee and the residential schools created by some of the Members will be open to others also.

• Hospitals • Transit camps / Guest Houses.

3.3 Sharing of Capabilities:

• Deputation of employees amongst Member organizations for On Job experience in technical and service functions.

• Conducting training programmes for each other, on requirement, on cost basis.

• Offering calendar programme to others at 50 % of notified cost per programme to 2 employees.

3.4 Optimization of Expenditure :

• Exchange of ‘Best Practice information’ to optimize Employee Cost and Administrative Expenditure.

• Joint exercise to reduce Medical Expenditure through uniform rates, tenure, etc. at empanelled hospitals.

3.5 Building Competence:

• A two weeks Program titled “HR for HR” was organized as a refresher course during Oct 4-16, 2004 at IMT, Ghaziabad.

• Joint workshop with NTPC and ILO on Organization Competitiveness was held at PMI on March 7, 2005.

• One week workshop on “Strategies for Effective Compensation System” was organized during April 11-15, 2005, with NTPC and IMI, New Delhi.

• Four Days program on “Finance for HR Executives” was organized during 18-21 Oct, 2005 at PMI/NTPC



3.6 Promoting Excellence:

Instituting Organizational Awards in following categories, with an aim to bring excellence: • Best Corporate Citizen • Promotion of Women’s Development, Empowerment &

Welfare. 3.7 Promoting Talent:

• To promote General Management Skills, Creativity, Innovative Thinking, Teamwork, and Presentation skills, an annual Inter Organization Competition titled ‘Quest for Excellence (Q4E)’ has been lunched. In Q4E-2004 hosted on November 2, 2004, the theme was “Unlocking creativity at Work Place-A road map”.

The theme for Q4E -2005 was “Roadmap for radical performance improvement”. Final presentation was hosted by NTPC at Power Management Institute, Noida on 24 September, 2005.

• Quizzing to Excellence (Q2E), an Inter Organisation Quiz

Competition, yet another annual event has been started from this year. Hosted by NHPC on April 22, 2005, the Quiz Masters were Sh SPS Jaggi and Sh Jacob Kurien from SAIL.

3.8 Collaborating with Professional bodies:

• Collaborating with AOTS [Association of Overseas Technical Scholarship-Japan] for training programs at Japan on different functional areas.



• In the first Phase the Forum has sent 26 Executives from Member Organisations for the Environment Management Program at Japan during 16-29, Nov, 2005.

• In the second phase Forum has tied up with AOTS to send 30

executives to Osaka, Japan to receive inputs on TQM.

4. Future Activities:

• To Organise workshops for member organizations on -

o Common minimum IT interventions o Learning organization & Knowledge Management o Benchmarking o Total Quality Management o Customer Focus o Initiative / interventions for Change Management

• Organize interaction session with renowned personalities and

visit to reputed organizations having good standing on Corporate Governance.

• Prepare a common minimum program on R&R Policy. • Suggest a model for uniform system implementation in HR

functioning / processes • Facilitating to identify and eliminate unproductive practices

with the help of external consultants, if necessary. • Preparing senior executives for board level appointment. • Devising the concept of Cost to Company (CTC) to attract

talent. • Generating a database for tapping the knowledge /skill of

retired people in Power sector. • To bring out a Journal by Forum, based on Research, Cases

studies and analysis on power utilities, including member organizations.



5. Forum Secretariat: NTPC has facilitated in shaping the Forum’s activities and giving it an institutional frame work. Other organizations are supporting the initiative by deputing employees to help in day-to-day work on a tenure basis. Apart from this, major events are hosted on rotation by the member organizations on consensus. The Secretariat is operating from the Power Management Institute at NOIDA, the apex level training centre of NTPC. The address: Power HR Forum Secretariat Power Management Institute/NTPC Plot no 5-14, Sector 16 A, NOIDA, UP – 201301 www.powerhrforum.org Contact Persons: 1. R. P. Ojha, GM-HR, POWERGRID & Convenor – Power HR Forum, [email protected] 2. DMR Panda, Sr Faculty Member, PMI/NTPC & Co-ordinator – Power HR Forum, [email protected] 3. H. P. Pal, Dy Manager-HR, POWERGRID & Co-ordinator – Power HR Forum, [email protected] 4. Konark Srivastava, Officer – HR, NHPC & Co-ordinator– PowerHR Forum, [email protected]