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Transcript of sanjay negiproject
PROJECT REPORT ON
CREDENTIAL OF HUMAN RESOURCES IN MARKET RESEARCH
Master Of Business Administration (Marketing)
Submitted in partial fulfillment of the requirement for award of
Master Of Business Administration of Tilak Maharastra
University, Pune
Submitted By:
Sanjay Negi
PRN- 07208015029
Of
Institute Of Business Studies & Research, Lonavala
Tilak Maharastra University
Gultekdi, Pune 411037.
1
Tilak Maharastra University, Pune
[Deemed Under Section 3 of UGC Act1956 Vide Notification
No. F.9-19/85 – U3 dated 24th April 1937 By Government of India]
Vidyapeeth Bhawan , Gultekdi, Pune – 411037
CERTIFICATE
This is to certify that project with Is of bonafide work carried out by Mr / Ms student of Master of Business Administration semester 4th Specialization under Tilak Maharastra University, in the year 2009.
Head of the department ExaminerExaminer
internal External
Date:
2
Place: University Seal
ACKNOWLEDGEMENT
“The satisfaction Euphoria that accompanies the successful completion of any work would be
incomplete unless we mention the name of the person, who made it possible, who constant
guidance and encouragement served as a beckon of light and crowned our efforts with success.” I
consider it a privilege to express through the pages of this report, a few words of gratitude and
respect to those who guided and inspired in the completion of this project.”
I would like to express my thanks to Mr.Bejoy Suri(Director Avsarr Quest Pvt.Ltd.) and
Dr.M.L.Monga(Executive Director-IBSAR) who gave me the opportunity to work with a well
known organization, Avsarr Quest Pvt.Ltd. which is the one of the best training and placement
organization of delhi.
I am very much thankful to Ms. Gunjan Agarwal(Director-Avsarr Quest Pvt.Ltd.) who gave me
the various ideas and provided her guidance to me for the market mapping in insurance sector.
I would like to thanks Mr. Duljinder Brar(Senior Manager-Avsarr Quest Pvt.Ltd.) who helped
me a lot to complete my market mapping work throughout the internship. Without his help
completion of this work was very difficult for me.
I would like to express my thanks to Mrs.Rashmi Mahajan who was my project guide at college
and who gave me her valuable inputs throughout my project.
Sanjay Negi
3
MBA-Marketing(2008-2010)
INDEX
Chapter No. Chapter Page No.
1 Rationale of study
2. Objective Of the study
2.1 Title Of the Project
2.2 Objective of study
2.3 Scope of study
3 Profile of the company
4 Review of literature
5 Research Methodology
5.1 Research Design
5.2 Data collection
Methods/Sources
5.3 Sampling Plan
6 Data Analysis & interpretations
7 Findings
4
CHAPTER-1
RATIONALE FOR THE STUDY
5
RATIONALE FOR THE STUDY
Avsarr Quest Pvt. Ltd. Is a recruitment and training firm which provides the recruitment and
manpower training in different sectors. The company hires the candidate for different banking
and insurance sectors. The firm also recruits for the media sector. The company also provides the
training for the banking operation sector. As the company provides the recruitment in the
banking and Insurance sector, my area of research is in market mapping for the different
insurance sectors. The company provides the manpower for different insurance sectors like icici,
hdfc,kotak,bajaj etc. So it is very much essential for the firm to provide effective manpower to
the different insurance companies. For that it is very necessary to know all the requirement of the
different insurance companies like which kind of manpower they want, salary and incentive
structure, previous work experience, skills and abilities of the candidate, target oriented and
potential candidate. For that the company conducted a research for different insurance
companies. The research was conducted on the basis of market mapping for different insurance
companies, by that the company could provide the effective recruitment for the various insurance
companies.
The companies covered in the market mapping:-
ICICI Prudential
Kotak
Bajaj
Aviva
Birla
HDFC
6
Reliance
The area which are being covered in the market mapping:-
Delhi market statistics
Organization structure across insurance firms
Compensation and benefits across levels in insurance firms
Profiles of sales manager across levels in insurance firms
Analysis of performing sales manager
7
CHAPTER-2
OBJECTIVE OF THE STUDY
8
OBJECTIVE OF THE STUDY
As the project was concerned with the market mapping of the various insurance companies,
which are related with Delhi/NCR regions,the objective of this study are as follows:-
Total market capture by each of the insurance companies
To identify the different organizational structure across the different insurance firms
To identify the compensation and the benefits across levels in the different insurance firms
To know about the profiles of the sales manager across the different insurance firms
To identify the policy advisors across the different insurance firms that why they differ
from company to company
To identify the salary structure of the different insurance companies
Why one company is performing well and what are the drawbacks by which the other
company is not performing well
9
What are the different parameters by which the insurance companies are attracting the
customer
To analyze the various competitive strategies of the different insurance companies by
which they are performing well.
To analyze the customer satisfaction level
What are the various parameters by which this study can be helpful to human resources
To analyze the factors of market mapping for human resources
10
TITLE OF THE PROJECT
CREDENTIAL OF HUMAN
RESOURCES
IN MARKET RESEARCH
11
SCOPE OF THE PROJECT
The research which is being conducted for the different Insurance companies is based on market
mapping. The market mapping is done for Delhi/NCR area. The mapping is being done with the
help of different organizational structure of the companies, salary and compensation structure,
profiles of the sales manager, market statistics and analysis of performance of sales manager. By
this study the fact which came to know is that there was a major difference in these companies in
the market statistic level, compensation level, heirarchial level and profile level. So by measuring
all these parameters this study can be very much useful in the manpower recruitment for many
companies and as well the study can be useful in the improvement of all those insurance
companies which are not performing well in comparison of other insurance companies. As the
company provides the recruitment in the banking and Insurance sector, my area of research is in
market mapping for the different insurance sectors. The company provides the manpower for
different insurance sectors like icici, hdfc,kotak,bajaj etc. So it is very much essential for the firm
to provide effective manpower to the different insurance companies. For that it is very necessary
to know all the requirement of the different insurance companies like which kind of manpower
they want, salary and incentive structure, previous work experience, skills and abilities of the
candidate, target oriented and potential candidate. For that the company conducted a research for
different insurance companies. The research was conducted on the basis of market mapping for
different insurance companies, by that the company could provide the effective recruitment for
the various insurance companies.
12
CHAPTER-3
COMPANY PROFILE
13
COMPANY PROFILE
Avsarr Quest Pvt.Ltd. has been incorporated under the Companies Act, 1956 and the company is
limited.
The registered office of the company is situated in the national capital territory of Delhi.
It imparts vocational training in various sectors along with facilitating the recruitment. It also
provides the training in different sectors along with banking.
It provides consultancy in the related matters and the financial matters to various industrial
sectors,public,students and other interested persons in India and abroad.
Main objects of the company:-
The main objects of the company are as follows:-
To provide consultancy in the related matters and financial matters to various industrial sectors
To carry out and develop activities relating to research and publications covering various aspects
of economy and other economic spheres as well as the publishing of books, magazines, booklets,
materials related to professional and academic studies as well as industrial and commercial
education both within India and abroad.
To carry out activities relating to development, maintenance and servicing of computer education
and software, computer hardware and networks computer aided education, communication and
multimedia products and systems, internet service providers by way of opening direct work
centres or giving franchise or network to others for the same.
14
Other objects:-
Other objects of the company are as follows:-
To act as consulting engineering and management consultants and to prepare project reports and
plan layouts and provide technical advice, guidance supervision in the erection, installation,
commissioning of any project industrial or otherwise
To carry on business in securities and to deal in stock and shares.
To carry on the business of buying, selling, exporting, importing, manufacturing, constructing,
devising and preparing all kinds of advertising novelties, materials, aids, complementary gifts,
design and any other such media used for the purpose of audio-visual publicity and
advertisement.
15
CHAPTER-4
REVIEW OF LITERATURE
16
REVIEW OF LITERATURE
Avsarr Quest Pvt.Ltd. is mainly a training and placement firm which recruits the manpower for
the various insurance sectors as well as the banking sectors.
These are the different insurance companies for which the firm recruits the manpower:-
ICICI Prudential
Kotak
Bajaj
Aviva
Birla
HDFC
Reliance
The area which are being covered in the market mapping are as following:-
Delhi market statistics
Organization structure across insurance firms
Compensation and benefits across levels in insurance firms
Profiles of sales manager across levels in insurance firms
Analysis of performing sales manager
17
Conclusion of the study:- The research which is being conducted for the different
Insurance companies is based on market mapping. The market mapping is done for Delhi/NCR
area. The mapping is being done with the help of different organizational structure of the
companies, salary and compensation structure, profiles of the sales manager, market statistics
and analysis of performance of sales manager. By this study the fact which came to know is that
there was a major difference in these companies in the market statistic level, compensation level,
heirarchial level and profile level. So by measuring all these parameters this study can be very
much useful in the manpower recruitment for many companies and as well the study can be
useful in the improvement of all those insurance companies which are not performing well in
comparison of other insurance companies.
18
CHAPTER-5
RESEARCH METHODOLOGY
19
RESEARCH METHODOLOGY
It constitutes the blueprint for the collection, measurement and analysis of data.
Research Design aids the researcher in the allocation of limited resources by posing crucial
choices in methodology.
Research Design is the plan and structure of investigation so conceived as to obtain answer to
research questions. The plan is the overall scheme or program of research. It includes an outline
of what the investigator will do from writing hypothesis and their operational implications to the
final analysis of data.
Research design expresses both the structure of the research-problem- the framework,
organization, a configuration of the relationships among variables of a study – and the plan of
investigation used to obtain empirical evidence on those relationships.
It is an activity and time based plan.
A plan always based on the research questions.
A guide for selecting sources and types of information.
A framework for specifying the relationships among the study’s variables.
A procedural outline for every research activity.
20
RESEARCH DESIGN
Research design is mainly consists with four dimensions:-
1-Research objectives
2-Research problems
3-Causes of problems
4-Solution
The research was designed in this study through the market mapping of the insurance sectors.
The objective of the research is to enhance the performance of the insurance companies by the
analysis of various parameters and various factors.
The problem in the reserch is the complicated profile structure of the insurance companies and
the various company policies.
This problem can effects on the performance of the various insurance firms.The solution for this
problem can be taken with the help of the market mapping which can enhance the performance
of the firms.
21
DATA COLLECTION METHODS AND SOURCES OF DATA
Data refers to a collection of natural phenomena descriptors, including the results of experience,
observation or experiment, or a set of premises. This may consists of numbers, words or image,
particularly as measurements or observation of a set of variables.
Types of data:-
Primary Data
Secondary Data
Primary source is used to collect initial material during the research process. Primary data is the
data that the researcher collects himself using methods such as surveys, direct observations,
interviews, as well as logs( objective data sources). Primary data are reliable way to collect the
data because the researcher will know where it come from and how it was collected and analyzed
since he did it himself. Primary sources of information allow the learner to access original and
unedited information . a primary source requires the learner to interact with the source and
extract information.
Secondary sources are edited primary sources, second-hand version. They represent thinking of
someone else. Secondary data are data that were collected by persons or agencies for purposes
other than solving problem at hand. They are one of the cheapest and easiest means of access to
information. Hence, the first the a researcher should do is to search for secondary data available
on he topic. The amount of secondary data is overwhelming, and researchers have to locate and
utilize the data are relevant to their research. Secondary sources take the role of analyzing,
explaining, and combining the information from the primary source with additional information.
22
SAMPLING METHODS
The sampling methods which has been used in this project is based on these insurance
companies:-
ICICI Prudential
Kotak
Bajaj
Aviva
Birla
HDFC
Reliance
The sampling has been done with the help of the market mapping of the above insurance
companies. The areas which are being covered in the sampling method are as follows:-
Delhi market statistics
Organization structure across insurance firms
Compensation and benefits across levels in insurance firms
Profiles of sales manager across levels in insurance firms
Analysis of performing sales manager
23
CHAPTER-6
DATA ANALYSIS
AND
INTERPRETATION
24
Area being covered
Delhi market statistics
Organization structure across insurance firms
Compensation and benefits across levels in insurance firms
Profile of sales manager across insurance firms
Analysis of performing sales manager
25
Delhi market statistics-snapshots
Table representing the snapshots of total premia collected per year
by the all the seven insurance companies:-
premia collected(Rs.Cr.)/year 3,130
Excluding LIC 1,220
Number of sales manager 6,070
Premia per sales manager(Rs.Lacs.) 51
Excluding LIC 22
Number of branches 275
Per branch productivity(Rs.Cr.) 11
Excluding LIC 6
Table representing the premia collected by the insurance companies per year
LIC Pru Birla Bajaj HDFC Reliance Aviva Kotak
1,900 380 170 120 90 70 65 40
All figures given are in crores
26
Delhi/NCR market size-total premia:-
The bar chart representing the premia size of each insurance company
Rs.
Cr. 380 170 120 90 70 65 40
The total market size:-Rs 3,130 cr/year
The private insurance market is highly consolidated with the top three player(out of seven)
accounting for~56% share of the market.
LIC is still the dominant player with 61% of the Delhi NCR market share
27
Delhi market statistics(performance analysis):-
The table representing the premia, no. of sales manager and premia per sales manager for all
seven insurance companies
Type 1 Type 2 Type 3
Firm Pru Birla Bajaj HDFC Reliance Aviva Kotak
Premia 380 170 120 90 70 65 40
No. of sales
manager
1200 350 800 800 750 400 300
Premia per
manager(Rs
Lacs)
32 49 15 11 9 30 13
The big difference between the ‘type 1’ and ‘type 2’ is not account of ‘number of managers’ in
the market but because of significantly higher sales manager productivity i.e. ‘Premia per
manager’.
The sales manager productivity for market leaders is 2 times that of the type 3.
28
Delhi market statistics(performance analysis):-
Table representing the maximum profit earning branch, no. of premia collected from the branch
and the second maximum profit earning branch of Delhi
Firm Pru Birla LIC Bajaj HDFC Reliance Aviva
No. 1
Branch
Connaught
place
Connaught
place
Connaught
place
Connaught
place
Bikaji
kama
Connaught
place
Gurgaon
Premia 90 cr 55 cr 100 cr 30 cr 17 cr 20 cr 25 cr
No. 2
branch
Peetampura Gurgaon Connaught
place
Lajpat
nagar
Gurgaon Janakpuri Noida
For most of the firms, the top branch is usually located in Connaught place
Gurgaon would rank second as the most productive location in terms of premia collection
29
Branch level organization structure:-
There are two types of organization structure across insurance firms at branch level
Type 1 Type 2
↑ ↑ ↑
←
↑
↑
Type 1 represents the organization structure for Birla,Bajaj and Kotak insurance
Type 2 represents the organization structure for Pru ICICI,Reliance,Aviva and HDFC
30
Branch HeadBranch Head Branch Head
Assistant Branch Head
Unit ManagerUnit ManagerAssistant Branch Head
Unit Manager
Unit Manager
Branch level organization structure-span of control
The table representing the two type of span of control:-
Type 1
Span of control:
BM:AB
M
ABM:UM Productivity of UM
Kotak 1:4 1:10 13
Birla 1:1 1:20 49
LIC 1:1 1:10 317
Type 2
Span of control:
BM:ABM ABM:UM Product
ivity of
UM
Pru 1:4 1:10 32
Reliance 1:4 1:10 9
Aviva 1:2 1:10 30
HDFC 1:2 1:6 11
Each of the type is containg the ratio of BM(Business Manager) and ABM(Assistant
Business Manager), ABM(Assistant Business Manager) and UM(Unit Manager) and
productivity of unit manager
31
BM:ABM means business manager suboardinating the assistant business manager.Like
that ABM:UM means assistant business manager suboardinating unit manager.
Area level organization structure-span of control
Table representing delhi head, regional head,assistant regional head and the branch head
of all the seven insurance companies:-
Firm Pru Birla LIC Bajaj HDFC Reliance Aviva
Delhi
Head
2 1 1 1 2 1 1
Regional
Head
5 4 3 3 8 4 3
Assistant
Region
Head
13 11 18 15 16 18 12
Branch
Head
39 20 65 32 50 37 24
Regional manager span of control:
1. High variation of span of control across firms
2. Within firms there is high variation depending on area manager vintage & size of branch
3. HDFC is having the maximum number of branch head in Delhi
4. Birla is having the minimum number of branch head
32
Birla-Organization structure
Span of control
1. Delhi NCR did business of~ 170 cr in Dec end.
2.There is no delhi head but a zonal head.
↑
↑
↑
↑
33
Zonal
Head
Branch
Head
Branch
Manager
(19)
BDM
Agency Manager
Pru ICICI- Organization structure
1. Delhi NCR did business of 300 crs for Dec 08
2. There are currently 39 branches in Delhi NCR
3. A branch is headed by S.M. or by an area mgr.
↑
↑
↑
↑
↑
↑
34
Zonal Manager
(1)
Regional Manager(3)
Associate Regional
Manager(2)
Branch Manager
(6)
Area Manager(12)
Sales Manager
(34)
Unit manager
(950)
HDFC Standard Life Insurance-Organization structure
Span Of Control
1.Delhi did business of ~90 cr
↑
2.There are around 800
Sales manager in all.
3.There are about 20
Location in delhi
↑ NCR with only 3
Location doing more
than 50 lac per month.
↑
35
Regional Manager
Territory manager
(8)
Branch Sales Manager
(50)
Area sales manager/Business Development Manager/Sales Development Manager
Aviva-Organization structure
Span of control
1.Delhi NCR did business of ~ 65 cr
in Dec end.
2.There is currently one head for
1:8 Delhi& NCR
↑ 3.There are currently 8 branches
in Delhi & NCR
4.A typical branch would have~20
Sales manager.
↑
↑
36
Zonal Head
(1)
Branch Manager
(8)
Deputy Branch Manager
(13)
Associate Sales Manager,Sales Manager
(220)
Reliance-Organization structure
Span of control
1.Delhi NCR did Rs. Cr in
Dec end.
2.There are currently 20
↑ Branches in Delhi NCR
3.A branch manager has both
sales manager and ABM
Reporting to him
↑
↑
37
Regional Manager
(1)
Area Manager
(4)
Branch Manager
SSM/SM
(700)
Salary and incentive structure-sales manager
Table representing highest,average,starting ctc,1st year target and different designations of
all the seven insurance companies
Firm Aviva Bajaj HDFC Birla Pru Rel
Highest
CTC
4.5 2.75 3.25 3.04 3.25 3.5
Starting
CTC
2.25 1.8 2.25 2.54 2.5 2.5
Average
CTC
3.75 2 3 2.75 2.75 2.75
1st year
Target
40 36 36 3 lacs of
advisor
income
36 36
Different
designations
Ass SM,
SM
SM,
SSM
SDM,
BDM,
Area SM
Agency
Mngr,
BDM
UM,
Agency
Mngr
SM,
SSM
Sales Manager salaries vary from Rs.1.8 lacs to 5 lacs
First year target varies from 36 lacs to 75 lacs for first year Manager.Targets increase for
higher vintage people
38
Salary and incentive structure-sales manager
There are three types of incentive structure across insurance firms
Type 1 Type 2 Type 3
There are three types of incentive structure prevalent across firms
Within each type there is a variation i.e. % of premia could be based on incremental basis
Although some conveyance allowance is paid under type 1 & 2, it is not as significant as
in type 3
39
1.Fixed CTC
2.% of premia earned
by advisors
1. Fixed CTC
2. % of income by
Advisors
1.Fixed CTC
2.% of income by advisors
3.Incentive based on
advisors recruited,number of
cases,etc.
Sales manager incentive structure-structure details
Type 1
Table representing all the incentives of sales manager of LIC,Bajaj,Kotak and HDFC
Firm LIC Baja
j
Kotak HDFC
% of premia earned by advisors 0.5-5% 3% 2%-4.75% 1%-6% on incremental basis
Other incentives 2,500
Conveyance
Type 2
Table representing the % of income earned by advisors of aviva and birla
Firm Aviva Birla
% of income earned by
advisors
5%-25% 15%-35%
40
Type 3
Table representing all the incentives of sales manager of pru ICICI and Reliance
Firm Pru ICICI Reliance
% of premia earned by advisor 2%-4% 0%-4%
Other incentive-number of policies 4,000-
20,000
<10,000
ther incentives- 4,000-
20,000
<15,000
The bar graph represents the comparison of Rs.20,00,00 collected in premia
Rs.`000 120 106 102 100 97.5 94 67 60
Birla has the most
attractive structure
41
for firms
At higher level of premia, Birla still has the most attractive incentive structure for Sales
Manager
However there is a significant change in ranking of firms at higher premia level
Sales manager incentive structure- comparison across insurance
firms
The relative attractiveness of different incentive structure changes with slab rates
Summary of rankings:
Comparison for Rs. 5,00,00 collected in premia
Rank Firm
1 Birla
2 Pru
3 Kotak
4 Reliance
5 Aviva
6 HDFC
7 Bajaj
8 LIC
42
Comparison for Rs. 20,00,00 collected in premia
Rank Firm
1 Birla
2 HDFC
3 Reliance
4 Aviva
5 Kotak
6 Pru
7 LIC
8 Bajaj
Salary and incentive structure-ABM/BM and higher level
Typically at the ABM and higher level,incentive structure become complex
Each manager has to perform on a set of KRAs
43
KRAs have individual weights
The weights are then tied to a scale
Rating on the scale determines incentives which are either linked to CTC/Basic or to
premia earned by them
ABM and BM incentive structure- comparison across insurance
firms
To compare the incentive structure for ABMs/BMs we use the following thumb rule:
1. What is important is not the theoretical incentive which an ABM/BM can make
but the actual incentive they could have made given last year firms performance
2. The higher the number of parameters to be achieved the tougher is to achieve the
incentive
3. The weight attached to `receive premia’ parameter is important. The higher the
weight the easier it would be to make more incentives
4. We are using a metric “Number of parameters/Weight of received premia” to
judge how complex/ or less lucrative an incentive structure is
44
ABM and BM incentive structure- comparison across insurance
firms
The table representing the typical branch manager target sheet across firms
Firm Aviva HDFC Pru
Number of SMs 35 30 60
Target of SM
(Rs.lacs)
45 36 36
Average SM
productivity last
year
30 11 32
Weight of premia 70% 100% 40%
Total no. of
parameters
5 1 5
Pay off rule on
100% achievement
70% of CTC 10% of SM
income+ 2-8% of
SM income based
on targets
0.1-0.2% of team
premia+ 100% of
basic
Complexity score 7 1 1
45
Only for two firms: Birla Sunlife and Pru ICICI are the sales manager targets and derived
sales manager productivity similer. It is more likely that branch managers would have
made the cut
For HDFC there is a payoff to sales managers irrespective of target achievement it is
likely branch managers would have made any incentives
For the other firms it is unlikely that branch managers would have made any incentives!
Birla sunlife-salary and incentive structure
Level CTC(Rs.Lacs) Incentive
Branch Head < 18 2%-5% of advisor income
based on 4 parameters
Branch Manager < 12 10% of team income
Business Development
Managers
< 5 10% of team income+
Agency Manager structure
for own advisors
Agency Managers 2.5 – 3.1 15% of advisor income up
to 3 lacs and then upto 35%
for incremental slabs
46
Table representing the sample incentive structure for partner
Key responsibility area Weightage Unit
Premia 40% Rs.cr
Number of policies 20%
Activation 20%
Recruitment of advisors 20%
About 4 parameters are used to get the weighted score. The weighted score is the tied to
the pay-out grid(detailed subsequently)
The table representing the Sample pay-out grid for partner
47
Percentage achievement of target Pay-out as a percentage of advisor income
>80 0%
80% 2%
90% 2.5%
100% 3%
105% 4%
>110% 5%
For levels higher than partner, the pay-out grid will be same but for each separate branch
Pru ICICI salary and incentive structure
48
Table representing the ctc of all levels of Pru ICICI
Levels CTC(Rs.Lacs)
Zonal Manager 16
Regional Manager 11-13
Assistant regional
Manager
9.5-11
Branch Manager 7.5-9.5
Area Manager 6-7.5
Sales Manager 5-6
Agency Manager
-Unit Manager
2.5-3.25
Advisor -
49
There are three components to the incentive structure for the Unit Manager/Agency
Manager
Premia received
Productivity of
team(Rs.Lacs)
Incentive
1-2 2%
2-3 2.5%
3-4 3%
4-5 3.5%
5> 4%
+Number of policies
Number of
policies in a
month
Incentive(Rs.)
1-2 4,000
2-3
3-4
4-5
5> 20,000
+
Activization
50
Activization Incentive(Rs.)
7 Activization+2 recruitments+
7 lives(>7.5k)
4,000
… 20,000
Sample incentive structure for SM and Area Manager
The SM and the area manager have forms of incentives:
Quarterly incentives: 0.1%-0.2% of productivity of the team(typically target for Unit
Manager is 36 lacs and the target for SM and AM are rolled up)
The annual bonus ties to achievement of the following set of KRAs
Key Responsibility
Area
Weightage Unit
Productivity 40% Rolled up-a SM with 10
unit managers would have a
target of 36 lacs for the year
Activization of advisors 20% Targets are typically 45%
Number of policies 20% Branch wise
The weightage score varies between 1 to 5. The annual bonus is then linked to basic
salary(and not CTC)
HDFC standard life- salary and incentive structure
The table representing ctc of all the levels of HDFC standard life:-
51
Level CTC(Rs.lacs)
Regional Manager 24
Territory Manager 9-12
Branch Sales Manager 5.5-7.5
Assistant Branch Manager 4.5-5
ASM-BDM 2.75-3.25
Sales Development Manager 2.25
Policy Advisor
HDFC standard life salary and incentive structure
Table representing the salary structure according to targts:-
52
SDM-BDM The incentive and target vary for:
High Vintage(more than 18 months
in the system):
Target of 60 lacs per annum
Low Vintage(less than 18 months in
the system):
Target of 30 lacs per annum
Target Achievement Percentage pay-out on incremental basis
Less than 75% Nil
>100% 1%
>125% 2%
>150% 3%
>175% 4%
>200% 5%
<200% 6%
Sample incentive structure for branch manager and general manager
There are three types of pay-off for branch manager:
53
Pay-out 1:10% of income of sales managers
Pay-out 1:10% of income of sales managers on meeting branch target(for example on
meeting 75% of branch target, additional 2% is paid-out
Pay-out 3:2-8% of income of sales manager on meeting target of productive sales
manager i.e. number of low vintage sales manager getting more than Rs 33 lacs premium
for the year. For example a sales manager meets 33 lacs of target, the BM will make 2%
of his income
Aviva-salary and incentive structure
The table representing ctc of all levels of aviva:-
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Level CTC(Rs.lacs)
Zonal Manager 18-21
Branch Manager 10-12
Deputy Branch Manager 6-8
Sales Manager <4.5
Assistant Sales Manager 2.25-3.25
The table representing the incentive of sales manager of aviva:-
Assistant Sales Manager/ Sales
Manager
Incentive vary from5%-25% of team commission
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<1 lac no incentive
1-2lac: 5%
2-3lac: 10%
3-5lac: 15%
5-8lac: 20%
>8 lac: 25%
Sample pay-out grid for ABM/BM and Zonal Manager
The table representing ctc of all levels of aviva:-
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Parameter Weight
Advisor
recruitment
7.5%
Active
retention of
advisors
7.5%
Persistancy 7.5%
SM attrition 7.5%
Scale Weight
Level 1 10-20% of CTC
Level 2 30% of CTC
Level 3 50% of CTC
Level 4 70% of CTC
About 5 parameters are used to get the weighted score. Rating on the weighted score are
given a scale of 1,2,3&4.
Scale of 2 would be 10% higher than 1 and so on
For levels higher than Branch Manager, the incentive structure will have different targets
for each branch and are aggregated. However the incentives are capped at 60%
Reliance-salary and incentive structure
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The table representing ctc of all levels of reliance:-
Level CTC(Rs.Lacs)
Regional Manager 25
Area Manager 12-15
BM 7-9
ABM 4-5
Senior Sales Manager/SM 2.5-3.5
A very simple structure has been devised for ABMs and higher position. On achievement
of target, say~1.5 cr for the branch, the branch manager can make up to 100% of salary
Sample incentive structure for sales manager & SSM
For sales manager and SSM , the incentive structure is a function of three parameters
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1- commission
Monthly productivity Commission
<1,00,000 0%
<2,00,000 1%
<3,00,000 2%
<4,00,000 2.5%
<6,00,000 3%
<8,00,000 3.5%
<10,00,000 4%
2- Conveyance
Allowance
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Lives(AP>10k) Rs.
8 to 10 1000
11 to 20 1500
21 to 30 3000
31 to 40 5000
41 to 50 7500
51 and above 10000
3- Active advisors in a month
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Active advisor Rs.
Upto 4 0
4 to 6 1000
7 to 8 2000
9 to 11 4000
12 to 15 7000
16 to 20 9000
21 to 25 12000
26 and above 15000
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Profiles of sales manager across insurance firms
The table representing premia per sales and yield of sales manager of all the seven firms:-
Firm Reliance Birla Pru Aviva Bajaj HDFC
Premia per
sales
manager
(Rs Lacs)
9 49 32 30 15 11
Yield of
sales
manager
3 18 11 8 6 5
Take
home for
sales
manager
3.3 5.5 4.3 4.4 3 3.2
Birla SMs are the most productive per Rupee of salary paid
Birla SMs also enjoy the highest take home package on average
In firms where productivity per sales manager>30 lacs, take home tends to be higher than
Rs 4 lacs
The lowest take home package on average is for Bajaj
Yield for the SMs is lowest in Reliance
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Analysis of performing sales manager
The most relevant metric for an insurance firm is `yield of Sales Manager
There could be two reasons why this varies across insurance firms:
1. Best performing insurance firm gets better candidate pool because:
i. They pay higher than others and people with higher
salary at better yield
ii. They attract people from a particular background
which others are not able to
2. Best performing insurance firms have developed system
and processes which lets selects candidates better and also make them more
productive
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The table representing the analysis of sales manager on the basis of their favourite sector
and previous role:-
Firm Birla HDFC Pru Reliance
Favourite
sectors
F,T F,T,Policy
advisors
B,P, Fresher
MBAs
F,T,P, SMs
Previous role Team leaders
working with
finance
companies like
Birla Home
finance, Tata
home finance
Team leader in
liability and
asset side and
telecom
Banking
CASA, DSTs
Team leaders in
asset side,
telecome,
pharma and SM
with other firms
like Bajaj,Pru,
etc.
Firm Aviva Bajaj Kotak
Favorite sectors F,T F,T, SMs from other
firms
F,T
Previous Role Team leader from
CASA and asset
side
Shelters, DST of
foreign banks, SMs
from Pru, Met Life,
etc.
CASA profiles with
banks
F- Finance, T-Telecom, B-Banking, P-Pharma
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Firms also have very similar hiring strategies- focusing on three key sectors- finance,
telecom and pharma
Therefore the only factor explaining better sales manager performance could be that
insurance firms have developed systems and processes which lets selects better
candidates and also make them more productive
Max on the importance of processes
“There are two things I look for while hiring sales managers: field sales experience and
coachability- if the person has desire to be coached the processes he can be a good sales
manager. Delhi networks may not matter too much but person should have a good family
background, education and networks from where he/she is coming. People with top class
education typically don’t stick too much”
“ I look at people who are trainable and receptive for new things. Person should be non-egoistic.
Person should know basic of sales. Sales people from direct sales like Kent RO system, resort
sales and CASA team leader have worked for me”
Birla :
“ We have always been very quality conscious in Our hiring process. A branch manager will
go and visit the house of the prospective agency manager to see whether the family is also
excited about the candidate joining Birla. It also help to do a reference check”
“ The other check we do at times is to ask a Person to get 3-5 prospective advisors before giving
the offer letter. This gives us a very good sense of the seriousness of the candidate and also the
pool this person would attract as an advisor”
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CHAPTER-7
FINDINGS
66
FINDINGS
The findings came by this study can be shown as follows:-
The first conclusion came by this study is that there are the difference between the
insurance companies in various level
By this study the fact came to know that there are different parameters for the different
insurance companies
The profiles of the sales manager is different in different insurance companies
By measuring the performance of sales manager it came to know that the companies
which are giving the higher renumeration to their sales manager they are performing
much better than others.
At last this study can be useful a lot to all other sectors because by measuring all these
parameters we can know that which are those levels where we have to improve and by
that the company can perform well.
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