A

Project report
On

At
J.K. Cement,
Nimbahera (Chittorgarh).

Submitted to
Rajasthan Technical University
In the partial fulfillment for the award of Master Degree of
Business Administration
Session 2007-2009

Submitted By: Under the

Guidance of:
Mr. Manu Vijay Mr. Rahul Jain
MBA III sem.

Vision School of Management

(Affiliated to Rajasthan Technical University & Approved by AICTE)
Udaipur Road Chittorgarh (Raj.)
E-mail: info@visionmanagement.Org
Website: www.visionmanagement.Org
DECLARATION:

This is to certify that the MRP submitted by me in Masters of Business

Administration Program from Vision School Of Management, Chittorgarh [Rajasthan
technical university, Kota] embodies the original work done by me under the able
guidance and supervision of Mr. R.P. Singh, General Manager (HRD & RTC), at J.K.
cement, Nimbahera (Chttorgarh).
No part of this report has been produced from any other summer project,
monograph, report or book and all facts and figures have been confirmed by
organizational guide.

Manu Vijay
M.B.A. [RTU]
Vision School Of Management
PREFACE:
This MRP is prepared as the partial fulfillment for Two-Year degree
Program of MBA curriculum of Rajasthan Technical University, Kota. It is
expected from an MBA to possess a good communication & effective presentation
skills.
Objectives of the project report, these are:-
i.) To study the impact of employee engagement on productivity of the organization.
ii.) To study the various methods of employee engagement prevailing in the
organization.
The research provides an opportunity to a student to demonstrate application of his/her
knowledge, skill and competencies required during the technical session. Research also
helps the student to devote his/her skill to analyze the problem to suggest alternative
solutions, to evaluate them and to provide feasible recommendations on the provided
data.
Although I have tried my level best to prepare this report an error free report every
effort has been made to offer the most authenticate position with accuracy.
This report contains a number of additional features:
Chapter 1. Introduces cement industry in India, general characteristic, key
external drivers, cement manufacturing process, swot analysis, price & profit to the
firm, trend & players, domestic players, market opportunities for investment &
company profile & objectives of the report.
Chapter 2. On conceptual framework which related to employee engagement (in the
public sector, interpretative models, power of employee engagement & 9 core
statement.
Chapter 3. On review of literature which consider “Merit board links employee
engagement & productivity”, “Engagement equals productivity”, “Cambridgeshire
county council” etc.
Chapter 4. On research methodology which consider definition, sample size, types &
techniques, tools used & limitation of the study.
Chapter 4. On data analysis & interpretation related to employee engagement &
productivity of J.K. cement.
 Chapter 5. On observation & finding, conclusions & suggestion related to research
methodology, data analysis & interpretation which consider the topic of “Impact of
employee engagement on productivity ( with specific reference of J.K Cement) of
organization.”
A bibliography in project report is provided at the end that should serve as good
sources of reference material for learners & researchers in the area.
An annexure appears at the end of the report that provides some useful sources of
information on the Internet regarding project report. This should prove to be a
welcome features for those persons who would like to access the net for more
information on issues covered in this project report.

ACKNOWLEDGEMENT:
The successful completion of a MRP requires guidance & help from a number of
people. I was fortunate to have all the support from my teachers. I therefore take
this opportunity to express my profound sense of gratitude to the all those who
extended their whole hearted help and support to me in completing the project
study report work on
“Imapct of employee engagement on productivity ( with specific reference of
J.K Cement) of organization.”
I also express my deep sense of gratitude to Mr. R.P. Singh, General Manager
(HRD & RTC), at J.K. cement, Nimbahera (Chttorgarh), who has helped us to
do our project. We also thank to Mr. Narendra Vaishnav (Officer- RTC).for
his valuable help in each stage of the project. Because of his co-operation and
continuous guidance successful completion of this project study report was
made possible.

I am sincerely thankful to Dr. A.L. Jain (Director, Vision School of Management)

for allowing me to undertake the report and making available all facilities for the
successful completion of the report besides guiding me to pursue the study on
proper line.
I also express my deep sense of gratitude towards Mr. Rahul Jain (Guide,
Faculty at VSM), Mr. Vibhor Paliwal, Dr. Snehal Maheshkar, Ms. Pratibha
Pagaria, Ms. Shobhika Tyagi, P.L. Dashora (Librarian) & all faculty
members.
No Acknowledge would suffice for the support my family members, my training
colleagues, classmates & friends.
Lastly, I extend my thanks to all those whose name have not been mentioned way
in successfully carrying out the project report.

(MANU VIJAY)
Executive-Summary:
For several years now, 'employee engagement' has been a hot topic in corporate circles.
It's a buzz phrase that has captured the attention of workplace observers and HR
managers, as well as the executive suite. And it's a topic that employers and employees
alike think they understand, yet can't articulate very easily. employee engagement as "a
heightened emotional connection that an employee feels for his or her organization, that
influences him or her to exert greater discretionary effort to his or her work".
At least four of the studies agreed on these eight key drivers.
1. Trust and integrity – how well managers communicate and 'walk the talk'.
2. Nature of the job –Is it mentally stimulating day-to-day?
3. Line of sight between employee performance and company performance
4. Does the employee understand how their work contributes to the
company's performance?
5. Career Growth opportunities
6. Are there future opportunities for growth?
7. Pride about the company
8. How much self-esteem does the employee feel by being associated with
their company?
9. Coworkers/team members
10. significantly influence one's level of engagement
11. Employee development
12. Is the company making an effort to develop the employee's skills?
13. Relationship with one's manager
14. Does the employee value his or her relationship with his or her manager?

We define employee Engagement as a psychological state in which in which employees

feel a vested interest in the company ‘s success and are both willing and motivated to
perform to levels that exceed the stated job requirements.
Its reflects how employees feel about the overall work experience
Employee Engagement foster & drives discretionary behavior, eliciting employees,
highest productivity, their best ideas & their genuine commitment to the success of the
organization.
Employee engagement, also called Work engagement, is a concept that is generally
viewed as managing discretionary effort, that is, when employees have choices, they will
act in a way that furthers their organization's interests. An engaged employee is a person
who is fully involved in, and enthusiastic about, his or her work. Employee Engagement
is now measured by items which have been linked to key business outcomes.
In a study of professional service firms, the Hay Group found that offices with engaged
employees were up to 43% more productive
The most striking finding is the almost 52% gaps in operating incomes between
companies with highly engaged employees and companies whose employees have low-
engagement scores. High-engagement companies improved 19.2% while low-
engagement companies declined 32.7% in operating income during the study period. For
example, New Century Financial Corporation, a U.S. specialty mortgage banking
company, found that account executives in the wholesale division who were actively
disengaged produced 28% less revenue than their colleagues who were engaged.
Furthermore, those not engaged generated 23% less revenue than their engaged
counterparts. Engaged employees also outperformed the not engaged and actively
disengaged employees in other divisions. It comes as no surprise, then, that engaged
employees have been statistically linked with innovation events and better problem
solving.
Arnold is more likely to define engagement as a beneficial two-way relationship where
employees and employers 'go the extra mile' for one another. Companies that get it right
reap the rewards and so do their employees, he said.
The benefits of having happy staff are well-documented. But the challenge for many
organisations is showing that engagement brings a tangible return on investment - a
process many companies find elusive.
"Engagement means different things to different people," Arnold said. "There was a risk
that it would become just another buzzword, so settling on a definition gave us a lot of
debate."
With this in mind, Arnold embarked on a study with Personnel Today to find out what
engagement meant to professionals in different organisations. The study, called Get
Engaged, measured engagement levels and whether companies felt they were making
progress.
Introduces cement industry in India, general characteristic, key external drivers, cement
manufacturing process, swot analysis, price & profit to the firm, trend & players,
domestic players, market opportunities for investment & company profile & objectives of
the report.
On conceptual framework which related to employee engagement (in the public sector,
interpretative models, power of employee engagement & 9 core statement.
On review of literature which consider “Merit board links employee engagement &
productivity”, “Engagement equals productivity”, “Cambridgeshire county council” etc.
On research methodology which consider definition, sample size, types & techniques,
tools used & limitation of the study.
On data analysis & interpretation related to employee engagement & productivity of J.K.
cement.
On observation & finding, conclusions & suggestion related to research methodology,
data analysis & interpretation which consider the topic of “Impact of employee
engagement on productivity ( with specific reference of J.K Cement) of organization.”
A bibliography in project report is provided at the end that should serve as good
sources of reference material for learners & researchers in the area.
An annexure appears at the end of the report that provides some useful sources of
information on the Internet regarding project report. This should prove to be a
welcome features for those persons who would like to access the net for more
information on issues covered in this project report.

CONTENTS
 DECLARATION I
 PREFACE II-III
 ACKNOWLEDGEMENT IV
 EXECUTIVE-SUMMARY V-VIII
 TABLE-CONTENT XI
 PIE-CHART CONTENT XI-XII
 Particular Page No.
Chapter – 1 Company Profile 1- 42
1.1 Introduction of the Industry 1
1.2 History behind J.K. cement 19
1.3 Management Setup 22
1.4 J K Marketing Organization 23
1.5 Social Responsibility 23
1.6 Type of cement 26
1.7 Corporate Profile 27
1.8 Company Strength 29
1.9 Company Achievement 31
1.10 Corporate Plan 33
1.11 Company Product 35

1.12 Information Required Under Section 217 36

(1)(e) of The Companies Act,

Chapter –2 Conceptual frame work 43-72

2.1 Introduction of Employee Engagement 43
2.2 Understanding Employee Engagement in The Public 45
Sector
2.3 Interpretative Models of Employee 49
Engagement.
2.4 Power of Employee Engagement 58
2.5 The 9 Core Statement of Engaged Employees 61
2.6 Four Fundamental Action Leading to +ve Results 62
2.7 Essential Reading 65
2.8 Latest on Employee Engagement 66
2.9 Earlier Stories on Employee Engagement 70
Chapter –3 Review of Literature 73-89
3.11 Merit Board Links Employee Engagement & 73
Productivity
3.12 Engagement Equals Productivity 74
3.13 Cambridgeshire County Council 76
3.14 Rotherham Metropolitan Borough Council 77
3.15 CIPD (2006c): Employee variations 78
3.16 B&Q 80
3.17 Towers Perrin 81
3.18 RBS - How a major corporation uses its 82
employee data
3.19 Literature view on impact of engagement 87
3.20 Importance of Employee Engagement 88
Chapter –4 Research Methodology 90-91
4.1 Research - Objective 90
4.2 Research - Plan 90
4.3 Limitation 91
Chapter – 5 Data Analysis and Interpretation 92-127
Chapter – 6 Conclusion and Suggestion 128-129
Reference and Bibliography 130

LIST OF TABLES

Particular Page No.

1.2.1 Industry demand supply outlook 3
1.2.2 Cement capacity that can be sold million tones 18
1.2.3 Present capacity & Performance 21
26
1.5.1 Types of cement
3.1 Literature view on impact of engagement 36
3.2 Importance of Employee Engagement 39

LIST OF CHARTS AND FIGURES

 Particular Page No.
2
1.1 General characteristics
1.2 Per Capital Consumption Of Cement (2003) 12

1.3 Capacity additions (million tones) 17

5.1 Employee engagement helps you a lot to 92

increase your knowledge, skill, attitude & ability to
perform the job.

5.2 You had proper discussion with your head of 95

department on the topics of training or the areas of
production are decided after proper discussion with you.
5.3 The objective of the production were clear to 98
you.
5.4 The senior is able to provide you knowledge 101
about all the aspects, which you want.
5.5 The methodology of production was excellent. 104
5.6 There is open discussion between you & the 107
HRD.
5.7 You had achieved your learning goals from the 110
employee engagement.
5.8 The HRD department seriously follow-up the 113
suggestion provided by you for the improvement of the
production.
5.9 Is the employee engagement supportive? 116
119
5.10 If their any feedback system about the production
from the production department.

122
5.11 What type of error may arise in your job, if you
don’t involve in employee engagement.

125
5.12 What quality of production you are getting from
J.K. cement.
Introduction:-
Industry Profile:-
The Indian cement industry with a total capacity of 151.2 million tones (including
mini plants) in March 2003 has emerged as the second largest market after China,
surpassing developed nations like the USA and Japan. Per capital consumption has
increased from 28kg in 1980-81 to 110kg in 2003-04. In relative terms, India’s
average consumption is still low and the process of catching up with international
averages will drive future growth.
Infrastructure spending (particularly on roads, ports and airports), a spurt in
housing construction and expansion in corporate production facilities is likely to
spur growth in this area. South –East Asia and the Middle East are potential export
markets. Low cost technology and extensive restructuring have made some of the
Indian cement companies the most efficient across global majors. Despite some
consolidation, the industry remains somewhat fragmented and merger and
acquisition possibilities are strong. Investment norms including guidelines for
foreign direct investment (FDI) are investor-friendly. All these factors present a
strong case for investing in the Indian market.

Cement industry trends in India:

 Cement industry is growing at 10-12%YoY

 There are over 125 large manufacturing plants and over 300 mini cement
plants.
 Over 180 million tonnes installed capacity and utilization is over 90%.
 Over 10 million tonnes exports.
 Growth is driven by infrastructure and housing boom.
 Technology changes in recent years towards modern and environmental
friendly.

General characteristics:
 Good made to stock

High capital intensive

Low labor intensive
Highly automated

End product is cheap

General Low differentiation
Characteristics
High weight/price
Ratio, hence
High freight cost

Cyclic industry,
Demand related to economic activity.

Industry demand supply outlook:

As on31 march FY04 FY05 FY06
Current Capacity 144.5 151.3 157.1
Capacity growth 4% 4%
Cement demand 117.2 127.1 141.6
Demand growth 8% 8%
Domestic 113.8 123.1 135.6
consumption
Growth domestic 7% 10%
consumption
Exports 3.4 4.1 6.0
Export growth 21% 47%
Cement capacity 81% 84% 90%
utilization

India’s per capita cement consumption of 110kg per year, whereas china’s
figures of 659 kg per year. This clearly shows that demand of cement in India’s
market has a lot to catch up.
During the tenth plan, the industry, expected to grow at 10% per annum
adding a capacity of 40-52 million tonnes, according to the annual report of the
department of industrial policy and promotion (DIPP). The report reveals that this
growth trend is being driven mainly by the expansion of existing plants.
The Indian cement industry not only ranks second in the production of
cement in the world but also produces quality cement, which meets global
standards. however , the industry faces a number of constraints in terms of high
cost of power , high railway tariff; high incidence of state and central levies and
duties; lack of private and public investment in infrastructure projects; poor
quality coal and inadequate growth of related infrastructure like sea and rail
transport, ports and bulk terminals .in order to utilize excess capacity available
with the cement industry, the government has identified the following thrust areas
for increasing demand for cement:
1. Housing development program.
 2. Promotion of concrete highways and roads.
3. use of ready mix concrete in large infrastructure projects; and
4. Construction of concrete roads in rural areas.

Indian cement industry is modern and uses latest technology. Efforts are being
made to recover waste heat and success in this area has been significant. India is
also providing different varieties of cement like Ordinary Portland Cement(OPC),
Portland Pozzolana Cement(PPC), Portland Blast Furnace Slag Cement (PBFS),
Oil Well Cement, Rapid Hardening Portland Cement, Sulphate Resisting Portland
Cement, White Cement, etc.
 CEMENT MARKET IN INDIA:

NORTH Punjab, Delhi, Haryana, Himachal Pradesh, J&K and Rajasthan.

WEST Maharashtra and Gujarat

SOUTH Tamil Nadu, Andhra Pradesh, Karnataka, and Kerela

EAST Bihar, Orrisa, West Bengal, Assam and Meghalaya

CENTRAL Madhya Pradesh and Uttar Pradesh

KEY EXTERNAL DRIVERS

IM RS

A Y
RA T
RY

ON
UT T
ST RE

SE LIT
IN UC

IN OS
PR IVE

S
A

A
C
R

P
DR

*Bank
lending rate *Raw
*Disposable material cost *Monsoon
SECOND- income *Fuel price *Festive
ARY *Government *Transportati season
DRIVERS initiative on cost
 A FLOW DIAGRAM OF
CEMENT MANUFACTURING PROCESS:

75-80% CaCO3, 20-25% Sio2 + Al2O3 + Fe2O3, Clay,

Chalk, Limestone, Sand, Shale.
Mart.

Quarrying
Quarrying

Crushing Crushing

Mixing

Raw Grinding

Burning to Clinker

Gypsum Additives

Cement Grinding

Cement

Packing &
Transportation
3 P’s of PERFORMANCE at J.K. CEMENT:
Profit does not provide the only clue to a company’s true performance.

This is because not all benefits and costs, arising from the company’s
operation, find their way to the balance sheet. For instance, the positive impacts of
a company’s operation on people in its vicinity, say the establishment of a hospital,
do not appear in its balance sheet. Neither do the negative impact.

It is for such reason that J.K. Cement prefers to highlight its performance
from three different angles, or what is called The Triple Bottom Line –
(1). Economic (balance sheet performance)
(2). Community (service to the society or community)
(3). Environmental (steps taken to nurture environment)

At J.K. Cement, we call them THE 3 Ps of Performance –

Profit, People & Planet.

PROFIT:
J.K. Cement way as far as profit is concerned besides making efforts to
influence turnover J.K. Cement emphasize on cutting cost to cut ahead. The reason
is simple turnover is an outcome of the price, price realization and quantity sold –
all factors dependent on externalities like government policies and market cycles
which are beyond company’s control. Cost, on the other hand, is something J.K.
Cement can and does exercise a lot of control over.

PEOPLE:
 The importance of the HR function lies in the fact that in an extremely
competitive industry like cement, the company's performance depends on the
creativity, motivation and initiatives of the individuals. Individuals comprise the
critical resource, instrumental in bringing about improvements in the
manufacturing process thereby reducing operating costs and maximizing gains.
To maximize gain from people side ASCENT GROUP has been created.
Ascent group is a motley collection of individual who get together to engage in the
self-development projects and motivate each other.
Beside this an IN-HOUSE MAGAZINE “MANTHAN” is published. The
simple objective of bringing out such magazine was to create a regular forum for
people at J.K. Cement to interact and express ideas and feelings. It is believed that
such an effort would have positive payoffs far beyond its pages.
Beside this every year it organizes HANUMAN MANDIR CULTURAL
FIESTA.

PLANET:
‘Produce more with less’ has been J.K. Cement’s guiding philosophy over
the years. The objective is to leave the minimum footprint, or negative impact, of
its operations on the earth’s resources.
To protect environment J.K. Cement has taken various initiatives in the field as
water conservation by Recycling of Waste Water, Rain Water harvesting, by
reducing Co2 emission, by Green belt development and by energy conservation

SWOT- ANALYSIS:-
 WEAKNESS
STRENGTH

Low cost production

Lime stone reserves No rail at Ras site
Captive power plant Waiting time of trucks adds to
Low logistic cost extra cost
100% use of pet coke as fuel

THREATS
OPPORTUNITY

Explore new alternate fuel Rise in inflation

Increase the sale of PPC Gap in demand & supply

Explore new markets Increasing competition

Improve IT infrastructure Increase in fuel price

Reduction in cement prices
Objective, CSI

The purpose of the Cement Sustainability Initiative is to:

• Explore what sustainable development means for the participating

companies and the cement industry.
• Identify and facilitate actions that companies can take as a group and
individually to accelerate the move towards sustainable development.
• Provide a framework through which other cement companies can
participate, and
• Provide a framework for engaging external stakeholders.

Agenda, CSI
The 10 companies involved in the CSI have chosen to develop an agenda for three
reasons:

• To prepare for a sustainable future by making a more efficient use of

natural resources and energy, and engaging with local issues in emerging
markets.
• To meet the expectations of stakeholders and maintain their ‘license to
operate’ in communities across the world through a greater transparency of
operations, effective engagement with society and initiating actions, which
lead to sustained positive changes, and
• To individually understand and build new market opportunities through
process innovations, which achieve greater resource/ energy efficiency and
long-term cost savings; product and service innovations to reduce
environmental impacts and work with other industries on novel uses of by-
product and waste materials in cement production.
 The companies have identified six key areas where they believe that the CSI
can make a significant contribution towards a more sustainable society

 Climate protection.
 Fuels and raw materials.
 Employee health and safety.
 Emissions reduction
 Local impacts.
 Internal business processes.

A GLOBAL HEAVY WEIGHT

India is the second largest cement producing country in the world. Cement
demand in the country grows at roughly 1.5 times the GDP growth rate. The
industry had a turnover of around US$7.8 billion in 2003-04 and according to
CRISIL is expected to grow at a CAGR of around 7per cent in the next five years.
The demand for cement is closely related to the growth in the construction sector.
Consequently, cement demand has been posting a healthy growth rate of around
8per cent since 1997-98, propelled by the increased thrust on infrastructure
development, and the higher demand from the housing sector and industrial
projects. This trend is likely to continue in the coming years.
 3.2 LOW PER CAPITAL CONSUMPTION – A LONG TERM OPPORTUNITY

3.2.1 PER CAPITAL CONSUMPTION OF CEMENT (2003)

1230

1030

830

630

430

230

0
China India US Japan Korea Mexico
Germany Thailand France

Source: United State’s Geological Survey

Another factor that makes Indian cement an attractive investment destination is the
combination of a lower per capital consumption and a faster growth rate. The Indian
cement industry has registered a production of more than 100 million tones since 2001-
02.

The per capital consumption of 102kg as compared to the world average of 260kg, 450kg
in China and 631kg in Japan underlines the tremendous scope for growth in the Indian
cement industry in the long term.
 Prices and Profits to the Firm

Major players in the industry are not planning any significant capacity addition for the
next two years. Considering the gestation period of setting up a cement plant, additional
supply from new capacities, if any, will arrive only from 2005-06 onwards. Limited
capacity additions and high demand will narrow the demand supply gap, improve price
realizations and lead to higher profitability.
Any further reduction in import duties on cement and clinkers is unlikely to affect the
industry as the cement produced is at par with the international standards and the prices
are lower than those prevailing in other international markets.

3.3.POLICY
Opening up the FDI Channel
The impact of government policies on cement demand has been steadily decreasing with

the sector being gradually deregulated. At present, 100per cent foreign direct investment

(FDI) is permitted in the cement industry. Lafarge was the first foreign company to enter

the Indian market in 1999.

Easing Environment Norms

To set up a cement plant in India, with an investment of over US$22million entrepreneurs

are required to obtain environmental clearance from the Ministry of Environment.100per

centFDI is allowed for private cement companies to set up power projects as well as coal

or lignite mines for captive consumption. State policies and norms to encourage

investment.

Both the state and export policies promote cement production. Exporters can claim duty

drawbacks on imports of coal and furnace oil up to 20 per cent of the total value of

imports. Most state governments offer fiscal incentives in the form of sales tax

exemptions in order to attract investment. In some states, this applies only to intra-state
sales, like Madhya Pradesh and Rajasthan. States like Haryana offer a freeze on the

power tariff for 5years, while Gujarat offers exemption from duty on electricity.

3.4.TRENDS AND PLAYERS

Cement production in India has increased at a CAGR of 8.1per cent during the last
decade with a production level of 117.5million tones in 2003-04. The cement in-
dustry comprises 125 large cement plants (capacity more than 0.198million tones
per annum) with an installed capacity of 148.28million tones and more than 300
mini cement plants (capacity less than 0.198million tones per annum) with an es-
timated capacity of 11.10million tones per annum.
The industry worked at an estimated 80.2per cent capacity in 2003-04. Small
plants, however, work at an installed capacity of around 40per cent.
Among the different varieties of cement, India produces Ordinary Portland Ce-
ment (OPC), Portland Pozzolana Cement (PPC), Portland Blast Furnace Slag Ce-
ment (PBFS), Oil Well Cement, Rapid Hardening Portland Cement and Sulphate
Resisting Portland Cement. The share of blended cement in total cement produc-
tion has increased from 29per cent in 1997-98 to 54.5per cent in 2003-04.

Deconstructing Costs
Energy (including the landed cost of coal), freight and limestone costs are the ma-
jor cost components of the cement industry. These costs account for around 35per
cent, 22per cent and 9.5per cent of the total production costs respectively.

Decline in energy cost

Indian cement companies have been able to curtail costs through the setting up of captive
power plants. There has been a decline in the average coal consumption from 0.18 tones per
tone of cement to 0.17 tones per tone due to pyro processing systems, increased usage of im-
ported coal (with higher calorific value) and the higher production of blended cement. The
switch from the wet process to the dry process of cement manufacturing has also aided in
saving energy costs.

DOMESTIC PLAYERS

Associated Cement Companies Ltd (ACCL)

ACC Ltd manufactures ordinary Portland cement, composite cement and special
cement and has begun offering its marketing expertise and distribution facilities to
other producers in cement and related areas. It has twelve manufacturing plants
located throughout the country with exports to SAARC nations. The company plans
capital expenditure through acquisitions. Non-core assets are to be divested to release
locked up capital. It is also expected to actively pursue overseas project engineering
and consultancy services.

Birla Corp
Birla Corp’s product portfolio includes acetylene gas, auto trim parts, casting, cement,
jute goods, calcium carbide, yarn etc. The cement division has an installed capacity of
4.78million metric tones and produced 4.77million metric tones of cement in 2003-04.
The company has two plants in Madhya Pradesh and Rajasthan and one each in West
Bengal and Uttar Pradesh and holds a market share of 4.1per cent. It manufactures
Ordinary Portland cement (OPC), Portland pozzolana cement, fly ash-based PPC,
Low-alkali Portland cement, Portland slag cement, low heat cement and sulphate
resistant cement. Large quantities of its cement are exported to Nepal and Bangladesh.
Going forward, the company is setting up its captive power plant to remain cost
competitive.

Grasim – Ultra Tech Cemco

Grasim’s product profile includes viscose staple fibre (VSP), grey cement, white
cement, sponge iron, chemicals and textiles. With the acquisition of Ultra Tech, L&T’s
cement division in early 2004, Grasim has now become the world’s seventh largest
cement producer with a combined capacity of 31million tones. Grasim (with Ultra
Tech) held a market share of around 21per cent in 2003-04. It has plants in Madhya
Pradesh, Chattisgarh, Punjab, Rajasthan, Tamil Nadu and Gujarat among others. The
 company plans to invest over US$ 9million in the next two years to augment capacity
of its cement and fibre business. It also plans to focus on its international ventures,
ramping up the capacity of Alexandra Carbon Black in Egypt to 1,70,000 tones Per
annum (from1, 20,000tpa) and raising the capacity of the carbon black plant in China
from12,000tpa to 60,000 tpa.

Gujarat Ambuja Cements Ltd (GACL)

Gujarat Ambuja Cements Ltd was set up in 1986 with the commencement of commercial
production at its 2million tone plant in Chandrapur, Maharashtra. The group has clinker-
manufacturing facilities at Himachal Pradesh, Gujarat, Maharashtra, Chattisgarh, Punjab
and Rajasthan. The company has a market share of around 10per
cent, with a strong foothold in the northern and western markets. Its total sales aggregated
US$ 526million with a capacity of 12.6million tones in 2003-04. Gujarat Ambuja is
India’s largest cement exporter and one of the most cost efficient firms. GACL has a
14.45per cent stake in ACC, making it the second largest cement group in the country,
after Grasim-Ultra Tech Cemco. The company has free cash flows that it is likely to use
to grow inorganically. The company is scouting for a capacity of around two million tone
in the northern and western markets. It has also earmarked around US$ 195-220 million
for acquisition.

India Cements
India Cements is the largest cement producer in southern India with a total capacity of
8.81million tones and plants in Andhra Pradesh and Tamil Nadu. The company has a
market share of 5.4 per cent with a total cement production of 6.36 million tones in 2003-
04. Its product portfolio includes ordinary portland cement and blended cement. The
company has limited its business activity to cement, though it has a marginal exposure to
the shipping business. The company plans to reduce its manpower significantly and exit
non-core businesses to turn around its fortune. It also expects the export market to open
up, with the Gulf emerging as a major importer.
JK Synthetics
JK Synthetics, a Singhania Group company, started manufacturing nylon at Kota in 1962.
Subsequently, it diversified into PSY/PFY, nylon tyre-cord, cement (in 1975), acrylic and
white cement (1984). The company has a market share of 2.7per cent. JK Synthetics
Limited is restructuring its business divisions into two separate entities- JK Cements and
JK Synthetics. After the restructuring, it will be left with a cement plant at Nimbahera in
Rajasthan, with a capacity of 3.26 million metric tones and manufacturing white cement.

3.4.MARKET OPPORTUNITIES FOR INVESTMENT

Growing demand-supply gap

Capacity additions (million tones)

Capacity additions (million tones)

250

200
195.2

168.2
150
146.4
117.3

100

50

0
2003.4 2006-07

According to CRISIL estimates,

Capacity given the demand-supply gap of roughly
demand
40million tones, capacity addition is expected over the next five years. Of this,
almost 30million tones will be met through Greenfield/Brownfield expansions
 and 10million tones through blending. The capacity addition of 30million tones
would require an investment of around US$ 2.2 billion.

Consolidation opportunity: Merger and Acquisitions

Cement capacity that can be sold million tones

Million tones
East 1.20
West 2.36
North 10.37
South 9.42
Total 23.35

Consolidation is expected to increase further in the cement industry. Around 23million

tones of additional capacity could be sold simply because on a stand-alone basis these
units are unviable. As part of a larger group, their operations could be cost effective. This
opens up a number of possibilities for acquisitions and mergers.

The Infrastructure Opportunity

The National Highways Development Project (NHDP) includes the 5,846km Golden
Quadrilateral (GQ) and the 7,300km North-South, East-West corridor. In addition, up-
gradation of rural roads, up-gradation to four/six lanes of about 13,000km of National
Highways and 10,000km of additional highways have been initiated.
The NHDP is expected to lay a significant part of the roads in cement concrete. Thus, if
25per cent of the roads of East-West corridors are laid by concrete, it is likely to lead to
an incremental demand of 5-6million tones of cement per annum. Likewise, the Golden
Quadrilateral is expected to add 4-5million tones of demand per annum. The total
demand from these road projects is expected to generate an incremental growth of 4-5per
cent per annum over the next 2-3 years.
Among other infrastructure sectors, construction and modernization of four airports
and two seaports, railroad, power plants and water management systems are also likely
to boost the demand for cement, in particular the ready-mix cement.
 Company Profile

1.1 HISTORY BEHIND J K CEMENT

The initial "J.K." stands for a father- son team, namely: Juggilal Kamlapath
Singhania

 J .K. organization started in the year 1884 at Calcutta. J .K. started their
business as a Financier, Investor, Trading Supplier of cotton belts and
manufacturer of small machinery parts like ‘V' belts, etc. They established
few small cotton textile industries also.
 In the year 1914 they shifted their business from Calcutta to Kanpur where
they established many big industries like J.K. cotton Mills, Straw product
Co, Lohia Mach, J.K. Pulp and Raymond’s Woolen, etc.

 In the year 1934 J.K. organization started one more division, as J.K.
Synthetics Ltd. They established various big plants of Nylon, Acrylic fiber,
etc. at Kota and Tyre Cord, Chemical and Pesticides at Jhalawar.

 In the year 1974 under the same division one more unit was started for
manufacturing of Grey Cement at Nimbahera.

 Expansion of this plant took place in the year 1979, when 2nd kiln was
commissioned with a capacity of 1200 tone per day and 7-lakh tones per
year. After modification in Preheater its present capacity is 1800 TPD.

 Again in the third phase, a kiln was erected in the year 1982 and production
of this kiln was 1350 tone per day.

 In the year 1988 a new technology was introduced in this 3rd Kiln that
consisted of precalcination process, which raised the capacity of this plant
 to 3400 tone per day,which was earlier 1350 tone per day. Besides, J.K.
cement plant is having its own diesel generator sets, producing power to
meet the power energy requirements.

 Main raw material for cement is LIMESTONE, for limestone we have our
own open cast mines adjoining to the plant. Besides we have developed
few more mines at Maliakhera, Karoonda and Tilakhera for producing
10,000 tones limestone per day as needed.

 J .K. Cement erected one more plant from Jan. 2001 with the capacity of
1400 tone per day at village Mangrol. In Nov.-2003 after modification in
Preheater and installation of Mechanical elevator its capacity increased to
2200 TPD.
 Due to power shortage as imposed by Ajmer electricity supply board J.K.
established its own Thermal Power Plant at village Bamania, near
Shambhupura, which is generating 15 M.W. power every day, which is
consumed by J.K. Cement Plant.

 J K Cement also has a plant of 400TPD-installed capacity of White Cement

at Gotan, Nagpur (Raj).
J.K. Cement has started the following projects:
 Cement Project at Karnataka of over 5500 TPD and Thermal Power Plant of
capacity 30 MW.

 Thermal Power Plant at Nimbahera of 22 MW.

 Waste Heat Recovery Plant at Nimbahera of 15 MW capacity.

 Bhumi Poojan of Dr Gaur Hari Singhania Technical University at

Bhatewar, Udaipur.

 J.K. cement is one of the most productive, cost efficient cement producing
plant in the country, a company, believing in corporate responsibility to
 society, integrity and fairness. The company’s cement is sold under the J.K.
Sarve Shaktiman brand name, enjoys good brand image and a price
premium.

The following types of cements are produced by J K Cement Works.

(a) Ordinary Portland Cement (OPC)
(b) Portland Pozzolana Cement (PPC)
(c) Super Silicate Cement (SSC)
(d) Masonry Cement (MC)

J. K. Cement manufactures and markets cement and clinker for both

domestic as well as exports markets.

1.2 PRESENT CAPACITY AND PERFORMANCE

1.2.1 CLINKER PRODUCTION

Ist Plant / Kiln 1200 Tone Per Day (TPD)

IInd Plant / Kiln 1800 TPD

IIIrd Plant / Kiln 5000 TPD

IVth Plant at Mangrol 2200 TPD

Total Capacity 10200 TPD

1.2.2 PRODUCTION ANALYSIS TABLE: IN TONS

Year Clinker Cement

2005-06 3170268 3511022

2006-07 2907196 3640823

2007-08 2917045 3765855

1.2.3 FINANCIAL ANALYSIS: IN Rs.
 Year Turnover PBT

2005-06 1108.7 52.2

2006-07 1529.7 272.0

2007-08 1812.8 346.6

1.3. MANAGEMENT SET- UP

1.3.1 Corporate Level- Kanpur

Chairman - Dr Gaur Hari Singhania

Managing Director - Shri Y P Singhania
Group Executive President - Shri R G Bagla

1.3.2Unit Head Level- Nimbahera

President - Shri.D.Ravisankar

J.K.Organization

J.K. Cement ltd.

J.K. Cement Works (Grey Cement) J.K. White Cement Works

1. J.K. Cement works, Nimbahera J.K. Grey Cement Works
2. J.K. Cement works, Mangrol
3. JJ.K. Thermal Power Plant, Bamania Gotan,Nagaur,
1.4. K Marketing Organisation & R T C - North
4. J.K. Thermal Power Plant, Nimbahera
Project:
 J.K. Cement Project, Karnataka
 1.4.1 J K MARKETING ORGANIZATION
The Head office of Marketing Department of J K Cement Ltd. is at Delhi,
which is headed by Sr. V P (Marketing-Grey Cement) and Sr. V P (Marketing-
White Cement). The White Cement is sold all over India and the Grey Cement
is sold in the States of Rajasthan, M.P., U.P., Haryana, Punjab, Gujarat and
Delhi. With the commissioning of J. K Cement Project, Karnataka Southern
region will also be covered for Grey Cement.

1.4.2 Regional Training Centre

The Regional Training Centre - North is a premier training centre of North

India promoted with assistance from World Bank, DANIDA and Govt. of India
as a unique HRD project in Cement Industry is also attached with J K cement
Works as Lead Plant. It is equipped with modern training aids and caters to the
skill enhancement and competency developmental needs of more than 20
cement and other plants. It has trained over 5000 technical and managerial
personnel during the last 12 years.
The centre has conducted many tailor-made in-house programs for cement and
other industries in India and abroad including for Oman Cement, Oman and
Star Cement,

1.5. SOCIAL RESPONSIBILITY

Educational services:
 Construction of rooms in Govt. College at Nimbahera.
 Running JK Institute of Technology, ITI in five trades affiliated to NCVT.
 Running 10+2 CBSE affiliated school
 Running Regional Training Centre for Cement technocrat’s aided by WB &
DANIDA.
 Various constructions in nearby govt. Schools of Chittorgarh district.
  We are involved in girls school (under construction) and committed
reasonable financial contribution for above

Medical services

 Rs. 36 lacks contribution for the construction of govt. Hospital at

Nimbahera.
 Ambulance to govt. Hospital.
 Free facility of pathological laboratory for the persons of surrounding area.
 Financial contribution to various NGOS for medical camps in the district.
 Financial contribution for construction of dispensary & health centre in
nearby villages.
 Free Homeopathic consultancy/medicines for the patients of nearby area.
Religious services

 Radhakrishna temple at colony premises.

 Prayer hall in hanuman temple in Nimbahera.
 Bheemkeshwar temple in staff colony.
 Dharmashala at Bhanwarmata (tourist/ religious place).
 8 rooms for Dharamshala at Pashupati Nath temple in Mandsaur (M.P.).
 Various temples in number of nearby villages.

Sports services
 Sports infrastructure like wooden badminton court, table tennis court,
billiard room, and cricket ground, volleyball ground in colony campus.
 Sponsoring all India youth football, volley ball and badminton tournaments.
 Sponsoring inter-district tournaments.
 Arranging summer camps for various sports.

Other social services

 Construction of approach roads in and around villages of mining
area.
  Digging of tube wells.
 Supply of tube well pumps.
 Construction of water tanks.
 Supply of drinking water in tankers in nearby needy places during
summer.
 Regular plantation in plant, colony and nearby villages.
 Direct and indirect employment to thousands of persons of
surrounding area.
 Financial helps to NGOS.
 Financial aid to organize religious festivals by municipals

Cement
Cement are bonding consisting essentially of compounds of calcium oxide with
silica alumina and iron oxide which can harden in air and water.

In general cement is a generic name for powdered materials, which initially have
plastic flow when mixed with water or other liquid but form a solid structure in
several hours with varying degree of strength & bonding properties, which
continue to improve with age.

History of Cement
 Joseph Aspendence discovered cement in1824.
 Materials used were Lime, Brick bed marl volcanic lava ash and water.
 Burn these materials in furnace at 1200C and ground with gypsum.
 1897 wet process kilns came in existence.
 Semi-dry process kiln slowly picked up.
 Dry process with two-stage kiln.
 Four stage pre-heater with pre-calcinator.
  Developed grinding process.

Types of Cement

Future Cement: -Portal cement tried cement and Soral cement, Reactive belite
cement and rice husk ash cement.
 BIS covers 14 types of cement.
 9 are commercially produced in India.
 Major cements are OPC, PPPC, PSC.
 Cements are classified into four groups
o General purpose cement
o Cements to meet environmental & climatic needs.
o Cements to meet the service conditions in construction.
o New cements.

1.5.1 Types of cement

CEMENT SYMBOL STANDARD
Ordinary Portland Cements 33 grade 33OPC IS: 269-1989
Ordinary Portland Cements 43 grade 43OPC IS: 8112-1989
Ordinary Portland Cements 53 grade 53OPC IS: 12269-1987
Portland Slag Cements PSC IS: 455-1989
Low Heat Portland Cement LHC IS: 12600-1989
Rapid Hardening Portland Cement RHC IS: 8041-1990
Sulphate Resisting Portland Cement SRC IS: 12330-1989
Portland Pozzolana Cement PPC (Fly ash IS: 1489(Part1)-1991
(Fly ash based) based)
Portland Pozzolana Cement PPC (Calcined IS: 1489(Part2)-1991
(Calcined clay based) clay based)
Masonry Cement MC IS: 3466-1988
High Alumina Cement HAC IS: 6452-1989
Supersulphated Cement SSC IS: 6909-1990
White Portland Cement WPC IS: 8042-1989
Oil Well Cement OWC IS: 8229-1989
Hydrophobic Cement HC IS: 8043-1991
CLASSIFICATION OF CEMENT

S.No CLASSES OF CEMENT CEMENT

1. General purpose cement OPC, PPC, PSC, HSC
2. Cements to meet environmental & climatic con- SRC, HAC, SSC, HC
dition needs
3. Cements to meet the service conditions in con- HAC, LHC, RHC, HSC,
structions OWC, WPC
4. New cements Portal cements, trief ce-
ment and soral cements and
rice husk ash cement
4.1.CORPORATE PROFILE

Vision –
“To be a premium conglomerate with a clear focus on each business.”

Mission –
“To deliver superior value to our customers, shareholders, employees and society at

large.”

Values –
“Respect for the individual, integrity, speed, simplicity, seamlessness, self
assuredness and a 100per cent commitment are the values we value.”

Management Philosophy –
 Customer Satisfaction

 Always invest in latest technology

 Huge distribution network creation

 Expansion through balancing equipment
 Constant focus on cost control & quality

 Invest in Managers & Develop people skills

 Stability of Executive Management & Low Employee Turnover

 Social Welfare – A Priority

 Salient Features –
1. First dry process plant in India.

2. Latest process precalcinator technology for clinker.

3. UNT –II was first PLC controlled cement plant in India.

4. Most modern and sophisticated central control room for entire process
control from one point.

5. First Fuzzy Logic Control kiln and Cen-scanner for monitoring of kiln
shell temperature in India.

6. On-line quality control by X-ray analyzer.

7. First computerized management system in Indian cement industry.

8. Now computerized management system extended to stores, purchase,

sales, accounts, and personnel functions.

9. Continuous on going process of training & development.

4.2.COMPANY STRENGTH

We enjoy a number of key competitive advantages, which have helped us maintain our
position as one of the leading cement manufactures in the Northern Indian cement
market. Our principal strengths and competitive advantages are as follows:

Leading position in attractive Northern India grey cement market:

Based on CMA data, Northern Indian cement manufacturers have consistently
operated at the highest levels of capacity utilization among India’s five regions. We
believe this reflects the strong demand in Northern India for cement products relative
to supply. Further, based on capacity expansions announced by cement manufacturers,
we except cement plants in Northern India to continue to operate at high utilization
levels and anticipate continued strong demand for our grey cement products in the
near and medium-term. We believed that we are well positioned to take advantage of
this demand, as the fourth largest grey cement manufacturer in Northern India, and the
largest grey cement manufacturer in the state of Rajasthan.

Second largest white cement producer in India:

White cement accounted for 16.6% of our total revenue and 35.2% of adjusted EBITDA
from our cement operations in fiscal 2005, and 15.5% of revenues and 26.7% of our
adjusted EBITDA from our cement operations in the six months ended September
31,2005.

Unlike grey cement, the white cement industry in India is highly concerned with the two
largest players accounting for the substantial majority of India’s production capacity.
Consequently, prices of white cement have been relatively less volatile and sales of white
cement have generated more stable cash flows for us even during industry downturns in
grey cement. We also believe our position as the second largest producer of white cement
in India, together with our nationwide delivery network, significantly enhances the
overall brand image of JK Cement.
Proximity and access to large reserves of high quality limestone:

We have access to large reserves of limestone for both our grey and white cement
operations, which we believe are sufficient to sustain our operations well into the future.
Based on independent geological surveys of different mines during 1996 to 2001, we
believe that our limestone reserves are sufficient to support our current and planned
capacity for approximately 40 years for both grey and white cement. (Put in risk
assuming we are able to renew our existing leases upon their expiry). As one of the first
cement producers in Northern India, we were able to choose our limestone reserves in an
area with high quality limestone resources. In addition to allowing us to produce white
cement, which requires high quality limestone, it also provides us with a cost advantage,
as we are not required to purchase sweeteners to improve the quality of limestone.

Further, our manufacturing plants are in close proximity to our limestone reserves,
resulting in lower transportation costs. Finally, our mines that supply our white cement
plant at Gotan also have a supply of white clay, an important additive necessary for white
cement production.

Experience and technical know-how:

We have 30 years of experience in the Indian cement industry, which we believe provides
us with the skills to maximize production efficiency, expand production capacity quickly
and reduce costs. Over the years, we believe that we have developed long-term customer
relationship and a strong reputation for quality.
Further, we have a stable and experienced middle and senior level management team,
many of whom have been working in our cement operations for more than 20 years. Our
Nimbahera manufacturing facility was chosen by World Bank and the Danish
International Development Agency as one of the four training centers in India to serve as
the “Regional Training Center” for Northern India.
There are only four regional training centers for the cement industry in India, and we
believe our operation of the training center provides us with access to state of art training
aids, live working models, and technical expertise developed by well known national and
international cement producers.

4.3.COMPANY ACHIEVEMENTS
The key events in respect of the JKSL Cement Division and the Company are set forth
below:
YEAR

1975
The grey cement plant at Nimbahera, with an initial capacity of 0.3 MnTPA, commenced
commercial production

1979
A second production line was added at Nimbahera, increasing the capacity from 0.3
MnTPA to 0.72 MnTPA

1982
A third production line was added at Nimbahera, increasing the capacity from 0.72
MnTPA to 1.14 MnTPA

1984
Lime-based white cement plant was established at Gotan, with an initial capacity of 0.05
MnTPA

1987
A captive thermal power plant was installed at Bamania

1988
A pre-calciner was installed at Nimbahera, increasing the total capacity to 1.54 MnTPA

1990
The JKSL Cement Division instituted Architect of the Year award
1994
(i) The Company was incorporated
(ii) The Regional Training Centre for Northern India, which was established at the
Nimbahera plant of the JKSL Cement Division with aid from the World Bank and the
Danish International Development Agency, commenced service

2000
The total capacity of the white cement plant at Gotan was increased to 0.3 MnTPA as a
result of continuous modernization and up gradation

2001
A new grey cement plant with a capacity of 0.75 MnTPA was installed at Mangrol

2004
(i) The Company acquired the JKSL Cement Division
(ii) The total capacity of the grey cement plant at Nimbahera was increased to 2.8 MnTPA
as a result of continuous modernization and upgradation

2005
(i) The Company allotted 7,426,950 Equity Shares to the shareholders of JKSL pursuant
to the AAIFR order dated January 23, 2003
(ii) The Company was listed on the BSE

2006
-JK Cement has finalised the issue price of its recently concluded initial public offering
(IPO) at Rs 148 per share.
-Jk Cement Limited has informed that w.e.f. 16.12.2006 Mr. Manish Bajpai Company
Secretary and Compliance Officer of the company has resigned and in his place Mr.
Ashish Sabharwal has been appointed as Company Secretary.
2007
-Jk Cement Limited has appointed Dr. K.B. Agarwal as Additional Director of the
Company to hold office until the conclusion of next Annual General Meeting.

4.4.CORPORATE PLAN

Increase Power generation capacity to 50MW by 2006-2007. Establish one

R&D center for cement & its applications such as concrete, tiles etc. To achieve
specific power consumption level of 85units per tone of cement. O.k. Cement
has excellent track record of HR Planning and Development. The initiative
taken for setting up Regional Training Center (RTC) as Nimbahera (in the
campus of J.K. Cement works) is an indication of Management’s commitment
towards HRD. The Center at Nimbahera is one of the four Rat’s in India and
caters the manpower development needs, not only to J.K. Cement Works, but
also supports cement industry in Western M.P., Rajasthan, Haryana, Jammu &
Kashmir, Himachal Pradesh and Punjab (i.e. Northern Region).

1. First Five-Year Plan (1951-56): -

In the beginning of the first five-year plan, there were 22 factories with a
production was 2.69million tones only. The target set for the first five-year plan
was 5.02million tones. Therefore, capacity enhancement was the main objective
of this plan.
2. Second Five-Year Plan (1956-61): -
Due to the rising demand a the end of the first plan period government imposed
a sort of control of issuing an order under section 18G of the industries
(Development & Regulations) Act, 1951, making it necessary for all cement
producers to sell their total production to State Trading Corporation of India for
 distribution to consumers at uniform price fixed by the Government from time
to time on F.O.R. destination basis.

3. Third Five-Year Plan (1961-66): -

This plan marked for industrial growth led the government to anticipate a heavy
shortage of cement and to meet this challenges. Expansion programs were
undertaken:
 To make survey for the prospecting and providing cement grade limestone
in the country.
 To set up unit in public sectors to achieve plan targets.
 To support all the ancillary and subsidiary activities connected with cement
and make efforts for its growth and development.

4. Policy of 1980:
National Highway Project, new railway lines, bridges, irrigation canals and
dams reshaped the country and projected a new face of the industrialist’s
scenario. The government of India had to decide start a partial decontrol of
cement industry and subsequently to fuller decontrol of it. The new policy
granted cement manufactures a profit of about 12% in their investments so that
rapid increase in cement production can take place to bridge the gap of demand
and production capacity.

Greenfield Grey Cement at Karnataka in Jaykaycem Ltd

A Greenfield Grey Cement project is being set up in Jaykaycem Ltd. (wholly
owned subsidiary of the Company) at Mudhol in the State of Karnataka with a
capacity of 3.5 million tones at an estimated project cost of Rs.1050 crores
(Rs.950 crores to be spent in first phase and Rs.100 crores in second phase for
putting up a Grinding Unit at Bellary). The project cost includes cost of Captive
Power plant of 50 MW. Foundation stone of the plant was laid on 8th December;
2007.The Company is in process of obtaining various approvals. Necessary land
has already been acquired and orders for long delivery items of plant and
equipments have already been placed. Financial closure of the project is likely to
be completed by end of September 2007. The Company proposes to invest about
Rs. 400 Crores in the said project from its internal accruals. A total sum of
Rs.76.40 crores has already been spent on the project. Barring unforeseen
circumstances, the project is expected to be on stream in first quarter of 2009.
During the year, the Company has acquired from IDBI the assets of Nihon
Nirmaan Ltd. at Gotan for Rs.42 crores. The Company has decided to utilize this
facility to produce Grey cement. It has been decided to revenue these facilities at
an estimated cost of Rs.70 crores the capacity of plant is expected to be 4 Lacs
Tons Revamping has already started and it is likely to be completed by December
2007. In the meantime, the Company has already started grinding facilities at the
plant w.e.f. 19.3.2007.

4.5.COMPANY PRODUCTS

We produce grey cement and white cement. Grey cement produced by us consists of
Ordinary Portland Cement (“OPC”) and Portland Pozzolana Cement (“PPC”). OPC has
three principal grades that are differentiated by their compressive strengths, and consists
of 53-grade, 43-grade and 33-grade OPC.
All our products comply with the quality standards specified by the Bureau of Indian
Standards (“BIS”). Our cement products are marketed under the brand names J.K.
Cement and Sarvashaktimaan for OPC products, J.K. Super for PPC products and J.K.
White and Camel for white cement products, which we believe are well known brands in
their respective markets.
Types of Cement

Grey Cement White Cement J.K. Wall Putty

 GREY CEMENT:

SPECIFICATION GREY CEMENT

RAW MATERIAL LIMESTONE & GYPSUM
TRADE NAME SARVASHAKTIMAAN
TRADE MARK VIJAYSTAMBH
PRODUCTS GRADES 43, 53, PPC
PACKAGING CAPACITIES 50 Kg per bag

During the year under report, the production of Grey cement at Nimbahera and Mangrol
plants were higher at 3.64 million tons compared to 3.51 million tons in the previous
year. Sales volume also increased in tandum with production. Higher realizations during
the current year coupled with increase in production of blended cement resulted in
substantially higher profits after setting of price increase of various inputs.

INFORMATION REQUIRED UNDER SECTION 217(1)(e) OF THE COMPANIES

ACT, 1956

A. CONSERVATION OF ENERGY

(a) Energy conservation measures taken:

* Installation of Cement Mill 5 to increase production of Cement Mill 4 along with close
circuiting.

* Installation of Cement Mill 6 to increase production of Cement Mill 3 along with close
circuiting

* Enlargement of down comer duct of PH 2 to save power.

* Replacement of Cement Mill 4 separator

* Feeding of fly ash at outlet of Cement Mill 3 from fly ash silo
* Close circuiting of 1 & 2 Cement Mills.

* ESP up gradation work at Kiln 4

* Additional Elevator for Cement Mill No.8

* Dust & Spillage Control System

* Installation of 13.0 MW waste heat recovery power plant.

* Installation of 20 MW Pet coke based captive power plant.

* Installation of 10 MW Turbine at Bamania to replace existing 7.5 MW Turbine.

* Installation of control & automation system at Kiln -3.

B. TECHNOLOGY ABSORPTION

(i) Research & Development, specific area in which R & D has been carried out.

* Increase in fly ash in PPC production

(ii) Benefits Derived as a result of above R & D

* Fly ash addition has been increased from 18.44% to 24.08% at NBH and from 17.72%
to 21.56% at Mangrol

* Reduction in cost
* Cleaner Environment
* Smooth & continuous running of Kiln & raw mill

(iii) Future Action Plan

* Size reduction of clinker granule and limestone

* Mechanical transport system for Kiln 1&2 CM 3&4

(iv) Expenditure on R & D

The Research & Development activities are carried out by our own team under
the advice and consultancy of foreign consultant. Apart from regular expenditure
on research activities debited to profit & loss account under different heads, the
company has paid contribution of Rs. 29 lacs to Research institutes for carrying
out research and development work related to Company's products.

(v) Efforts in brief, made towards Technology Absorption, Adaptation and

innovation.
* Daily monitoring of power consumption
* Preventive monitoring of all critical equipments.

WHITE CEMENT:
The production of white cement at 248880 M.T. during the year under review
against 226729 M.T. in 2005-06 recorded growth of 9.77%. This was mainly on
account of robust growth of around 65% recorded in export volumes (37294 tons
vs. 22472 tons). The growth in domestic market (including Nepal) was 3.59%.
Increased market of value added products mainly wall putty also contributed to
additional profits.

A. CONSERVATION OF ENERGY
(a) Energy conservation measures taken:

* Steam exhaust cyclone dust collection arrangement modified for online re-
feeding, eliminating the operation of additional drug chain to conserve energy

* Calciner installed to enhance kiln capacity and achieve further reduction in

energy consumption.

* A clay crusher was developed and installed at raw mill to take care of large size
lumps and to cater demand for increased capacity resulting in smooth operation
and energy conservation.

(b) Additional Investments & proposals being implemented for reduction in

conservation of energy.

B. TECHNOLOGY ABSORPTION

(i) Research & Development, specific area in which R & D has been carried out.

* Clinker dryer circuit optimization to achieve homogeneous seasoning resulting

in improved cement quality

* Kiln inlet modified with improved seal to reduce the fresh air entry to improve
the Clinkerisation process

* The clinkerisation process controls switched to free lime control in place of

clinker litre weight control by installing latest X-Ray analyzer having XRF &
XRD features
(ii) Benefits Derived as a result of above R & D

*Consistency in quality with increased whiteness

*Consistency in kiln operation and clinker quality

(iii) Future Action Plan

*Complete automatic Putty manufacturing plant keeping the specialities of
imported high-speed mixers, batch controller, to cater the increased market
demand and consistency in quality.
*Upgrading of Packing machines with check weigher arrangement for 50 Kg.
Cement bags.
*Petcoke/Coal/Lignite based thermal power plant.

(iv) Expenditure on R & D

The Research & Development activities are carried out by our own team under
the advice and consultancy of foreign consultant. Apart from regular expenditure
on research activities debited to profit & loss account under different heads, the
company has paid contribution of Rs. 29 lacs to Research institutes for carrying
out research and development work related to Company's products.

(v) Efforts in brief, made towards Technology Absorption, Adaptation and

innovation.
* Monitoring of energy consumption
* Proactive approach towards Environmental Management System.
J.K. Wall Putty:
White cement based putty for luxurious and silky interior/ exterior finish of our
dream home. J.K. Wall Putty is White Cement based putty for cement plastered
walls and ceilings. J.K. Wall Putty is used to fill the uneven surfaces of cement
 plastered walls and concrete walls. Application of J.K. Wall Putty provides
smooth and strong finish to the walls for further application of all kinds of
paints. The smooth finish gives better look to interiors and exteriors.

Surface Preparation:
The surface should be cleaned to make it free from dirt, dust, grease, oil and
paint. All foreign impurities should be removed with a wire-brush. Wall
surfaces should be cured so that the surface is saturated with water yet in ‘touch
dry’ condition.

Treatment of New Surface:

The new surface requires only soft treatment such as removal of dust, dirt and
foreign matter. In case of cracks, voids and damages; it should be patched up
prior to application of J.K. Wall Putty with grey/white cement.

Treatment of Old Surface:

All loose material and/or organic growth must be removed with putty blade or
brush. In case of old painted surface scrub the surface with course emery
stone/paper.

Preparation of J.K. Wall Putty Paste:

J.K. Wall Putty is a fine powder. Mix slowly J.K. Wall Putty with approx.40%
water by volume to prepare paste of desired consistency. Mix vigorously for 5-
10 minutes lump free, uniform and smooth putty paste. Product should be
mixed in required quantities to be used within 2-3 hrs. of preparation.

Application:

Apply uniformly the first coat of J.K. Wall Putty with blade/ trowel on the wall
from bottom to top. Apply second coat after the first coat has dried completely.
 Limit the total thickness of 2 coats to 1.5mm. Allow completely drying and then
use fine emery paper to remove the application mark if any. Any kind of paint
can be applied on this surface. Use water for curing before applying paint.

Precaution:

Although J.K. Wall Putty does not contain any toxic material, use rubber gloves
while mixing, as prolonged exposure with water may soften the skin resulting
in fine cuts/legions due to cement particles. Precaution should be taken to avoid
dust inhalation while handling the powder putty.

Storage:

Store J.K. Wall Putty in a dry place and open the pack just before use. Keep out
of reach of children.

Theoretical frame work :-

Employee Engagement:-
For several years now, 'employee engagement' has been a hot topic in corporate circles.
It's a buzz phrase that has captured the attention of workplace observers and HR
managers, as well as the executive suite. And it's a topic that employers and employees
alike think they understand, yet can't articulate very easily. employee engagement as "a
heightened emotional connection that an employee feels for his or her organization, that
influences him or her to exert greater discretionary effort to his or her work".
At least four of the studies agreed on these eight key drivers.
15. Trust and integrity – how well managers communicate and 'walk the talk'.
16. Nature of the job –Is it mentally stimulating day-to-day?
17. Line of sight between employee performance and company performance
18. Does the employee understand how their work contributes to the
company's performance?
19. Career Growth opportunities
20. Are there future opportunities for growth?
21. Pride about the company
22. How much self-esteem does the employee feel by being associated with
their company?
23. Coworkers/team members
24. significantly influence one's level of engagement
25. Employee development
26. Is the company making an effort to develop the employee's skills?
27. Relationship with one's manager
28. Does the employee value his or her relationship with his or her manager?

We define employee Engagement as a psychological state in which in which employees

feel a vested interest in the company ‘s success and are both willing and motivated to
perform to levels that exceed the stated job requirements.
Its reflects how employees feel about the overall work experience
Employee Engagement foster & drives discretionery behaviour, eliciting employees ,
highest productivity, their best ideas & their genuine commitment to the success of the
organization.
Employee engagement, also called Work engagement, is a concept that is generally
viewed as managing discretionary effort, that is, when employees have choices, they will
act in a way that furthers their organization's interests. An engaged employee is a person
who is fully involved in, and enthusiastic about, his or her work. Employee Engagement
is now measured by items which have been linked to key business outcomes.
In a study of professional service firms, the Hay Group found that offices with engaged
employees were up to 43% more productive
The most striking finding is the almost 52% gaps in operating incomes between
companies with highly engaged employees and companies whose employees have low-
engagement scores. High-engagement companies improved 19.2% while low-
engagement companies declined 32.7% in operating income during the study period. For
example, New Century Financial Corporation, a U.S. specialty mortgage banking
company, found that account executives in the wholesale division who were actively
disengaged produced 28% less revenue than their colleagues who were engaged.
Furthermore, those not engaged generated 23% less revenue than their engaged
counterparts. Engaged employees also outperformed the not engaged and actively
disengaged employees in other divisions. It comes as no surprise, then, that engaged
employees have been statistically linked with innovation events and better problem
solving.
Arnold is more likely to define engagement as a beneficial two-way relationship where
employees and employers 'go the extra mile' for one another. Companies that get it right
reap the rewards and so do their employees, he said.
The benefits of having happy staff are well-documented. But the challenge for many
organisations is showing that engagement brings a tangible return on investment - a
process many companies find elusive.
"Engagement means different things to different people," Arnold said. "There was a risk
that it would become just another buzzword, so settling on a definition gave us a lot of
debate."
UNDERSTANDING EMPLOYEE ENGAGEMENT IN THE PUBLIC SECTOR

Introduction
3.1 The objective of this review the extent to which employee engagement varies
between the public and private sectors. This was examined on two levels:

• Are there any fundamental differences in how employee engagement operates

between the public and private sectors that would impact on interpretative
models? In particular, do the drivers of employee engagement vary between the
two sectors? And
• What evidence, if any, is there on the effectiveness of employee engagement
between the public and private sectors? Are there any marked differences between
the sectors in terms of how engaged staff are?

Variations in employee engagement process

3.2 From our analysis of the models presented the differences between the public and
private sectors have no impact whatsoever on how employee engagement works. This
reflects the fact that the positive factors impacting on employee engagement apply with
equal weight to the public and private sectors. In particular this includes:

• The importance of providing high quality management, especially at supervisory

and immediate line management level
• The importance of having a strong organisational vision and clarity in goals that
are clearly articulated and communicated to staff at all levels
• The importance of engaging in effective two-way communication between the
organisation and its staff

3.3 No interpretative model of the employee engagement process assessed as part of the
literature review has drawn any sectoral distinction: they are generic across all
organisational types in the public and private sectors. This is a key finding of the
literature review.

3.4 However, the employee engagement outcomes do vary according to a range of

factors reflecting organisational and employee characteristics. The aspiration to find a
'one size fits all' model does not apply, either to all individual employees or to all
organisations. These variations are discussed below.

Variations in employee engagement outcomes

3.5 There is a surprisingly limited amount of research commenting on variances in

employee engagement between the public and private sectors. This may relate to the fact
that there is more in common between the sectors than there is variation and the
principles of engagement tend to be generic across both sectors. The literature reviewed
tends to highlight the relatively strong performance of the public sector in terms of job
specific parameters ( i.e. public sector workers are more likely to receive compensation
for working extra hours, and find their work more worthwhile and personally
meaningful) but its weaker performance in the critical employee engagement drivers such
as strategic vision and management. For example, CIPD (2006c) in a national survey of
2,000 UK employees found the following:

• Hours worked - there are no differences between the public and private sectors in
terms of hours worked. However, public sector workers are more likely to receive
some compensation for working extra hours than those in the private sector;
• Work-life balance - one would have expected that public sector workers would
be receiving more help from their employer to achieve a good work-life balance,
but actually there is no difference;
• Employer negatives - public sector employees are more negative about their
employers than their private sector counterparts, reporting that:
o They experience more bullying and harassment than those in the private
sector
o They are less satisfied with the opportunities they have to use their
abilities
o They are more stressed and under more pressure
o They are more critical of their organisation
o They are less likely to feel their senior managers have a clear vision for
the organisation
o They have less trust and confidence in their senior managers; and
o They are also less likely to believe organisational communication.
• Job positives - however, the public sector ethos is reflected in the fact that more
public sector workers find their work worthwhile and personally meaningful. This
is an important finding, that Penna (2007) presents a model whereby 'meaning at
work' is at the apex of the model, and one of the most important factors in driving
engagement.
• Individual/employee performance outcomes - public sector workers rate their
own performance lower than private sector employees and are more likely to have
taken more sick leave in the last year.

3.6 Ipsos MORI (2006) has highlighted the need for public sector organisations to
improve the way in which they manage change and develop leadership capability. It is
discussed later how engagement can help organisations manage change (see the
Cambridgeshire County Council case study which highlights how engagement was
brought in to assist a large and difficult change in the Council). Drawing upon research
data from over 200 of the UK's leading organisations, an analysis by sector shows that in
many areas there is typically little difference in employee attitudes. However, in core
aspects of working life (ref. 'job positives' above), public sector staff tend to be happier
with:

• Job security
• Being paid fairly and their pay reflecting level of performance
• Training and development opportunities
• The feedback they receive from line managers
• Working hours.
3.7 As a result of the research, Ipsos MORI (2006) conclude that public sector employees
are more likely to feel that the work they do is interesting and, in general, perceive a
greater feeling of morale where they work.

3.8 In contrast, the public sector usually trails the private sector in two key areas: change
management and leadership capability (this is despite the fact that public sector
employees report a greater level of contact with senior management). The Ipsos MORI
(2006) research found that whilst around three-quarters of employees in both sectors
understand the need for change, there is a large disparity in terms of those who support
the need for change - with 75 per cent of employees in the private sector supporting the
need for change, compared to 65 per cent in the public sector. Moreover, public sector
employees are significantly more likely to feel that some of the changes being
implemented are unnecessary: they believe that " there is too much change for change's
sake". Thus it is imperative that managers fully engage staff in understanding the
rationale for change, rather than just communicating the change to them, and support
employees through the change process.

3.9 In terms of the more practical aspects of change management, again public sector
employees are more critical. A quarter of private sector employees, compared to just 15
per cent of public sector employees, believe that change is well managed in their
organisation: see Figure 3.1.

Figure 3.1 Perceptions of Change Management by Sector

Source: Ipsos MORI (2006)

3.10 The Ipsos MORI (2006) research highlights other areas in which public sector staff
are usually more critical than their private sector counterparts:
 • Receiving recognition for good performance and providing opportunities for
employees to let the organisation know how they feel about things that affect
them in their work
• Having adequate /sufficient facilities or resources to do their work effectively
• The belief that their organisation puts customers first
• Confidence that they are working for a successful organisation.

3.11 As a consequence, the public sector tends to trail the private sector in core areas that
can lead to enhanced employee engagement, such as clarity of direction, effective
communication and management. The conclusion of this research is that the public sector
needs to concentrate more on how it manages change and develops leadership capability,
to contribute to delivering the Public Sector Reform Agenda effectively.

3.12 These findings in the UK are supported by research in Canada conducted by the
Auditor General of British Columbia (Office of the Auditor General of British Columbia,
April 2002). The British Columbia public service received an engagement rating of 59
per cent compared to 79 per cent for the top 50 companies to work for in Canada (Hewitt
Associates: The 50 Best Companies to Work for in Canada, as cited in Office of the
Auditor General of British Columbia 2002). In comparison to the leading private sector
companies, British Columbia's public service employees are relatively happy with their
work, are just as committed to staying with their employer, but due to a climate of
distrust, a lack of confidence in their managers, and a feeling that the public hold a
negative view of them as workers, they are not as proud of where they work. Only 43 per
cent would highly recommend their department to a friend seeking employment,
compared to 86 per cent in the comparison group. Again the public sector compares
favourably in job content, but is weak in terms of organisational identity and advocacy
amongst staff.

Summary and key findings

• No interpretative model of the employee engagement process that has been

reviewed has drawn any sectoral distinction: they are generic across the public
and private sectors.
• However, the employee engagement outcomes do vary according to a range of
factors reflecting organisational and employee characteristics. The aspiration to
find a 'one size fits all' model does not apply.
• In general, public sector employees are more satisfied with their job
characteristics, but are significantly less satisfied with key drivers of employee
engagement compared to the private sector.
• These weaknesses include lack of orientation to organisational objectives and lack
of advocacy.
• However, variations in employee engagement within sectors are far more
significant and important than any reported variations between the public and
private sectors. The challenge is for employers to understand the importance of
employee engagement within their own organisation and to address it effectively.
INTERPRETATIVE MODELS OF EMPLOYEE ENGAGEMENT

Introduction

4.1 This chapter looks at the models of engagement as found throughout the literature. An
employer's point of view, engagement is often about employees 'going the extra mile' or
exerting 'discretionary effort'. It was also discussed that many of the factors that drive
engagement are under the control of the organisation. However, employees will place
different emphasis on the extent to which they value each of these factors in exchange for
their discretionary effort. This chapter therefore examines the models of engagement in
the literature to determine what the key drivers of engagement are, and the extent to
which employees value these, and what employees find connects them to the
organisation, motivates them to perform above and beyond expectations and compels
them to actively promote the interests and objectives of the organisation.

4.2 Although the organisation has primary responsibility for leading engagement, there
are also secondary employee and job specific factors which can affect levels of
engagement. These are also discussed in this chapter to provide a more comprehensive
picture of the factors that determine engagement. The findings are presented under the
following headings:

• Modelling Engagement - a series of the most relevant interpretative engagement

models are presented.
• Role of Engagement in Organisational Outcomes - this section illustrates the
mechanisms through which engagement can impact on organisational outcomes.
• Organisational Variations - an analysis of the extent to which engagement varies
between organisations.
• Employee Variations - an analysis of the extent to which engagement varies
between employees.

Modelling engagement

4.3 As highlighted by CIPD (2007a) there is no definitive all-purpose list of engagement

drivers. There are many individual and organisational factors that determine whether
employees become engaged, and to what extent they become engaged. This section
highlights the models that illustrate these factors and the importance that employees place
on them in becoming engaged.

4.4 The approach to employee engagement, discussed by Robinson et al (2004), stresses

the importance of 'feeling valued and involved' as a key driver of engagement. Within this
umbrella of feeling valued and involved there are a number of elements that have a
varying influence on the extent to which the employee will feel valued and involved and
hence engaged. Figure 4.1, which is based on a diagnostic model in Robinson et al
(2004), illustrates the drivers of engagement suggested through a survey of over 10,000
NHS employees. Robinson et al (2004) state that this can be a useful pointer to
organisations towards those aspects of working life that require serious attention if
engagement levels are to be maintained or improved.

Figure 4.1 Robinson et al (2004) model of the drivers of employee engagement

Source: Robinson et al (2004)

4.5 Although tested within the NHS, the authors suggest that many of the drivers of
engagement will be common to all organisations, regardless of sector. However as is
discussed later in this chapter, engagement levels can vary according to demographic and
job related factors. What is noted from the model above is that some of these factors are
what would be fundamental or contractual requirements for the organisation (the
'hygiene' factors), such as pay and benefits and health and safety, whereas others are the
areas where the organisation must 'go the extra mile' to ensure effective communication,
management and cooperation.

4.6 Penna (2007) presents a hierarchical model of engagement factors (see figure 4.2),
which illustrates the impact each level will have on the attraction, engagement and
retention of talent. They propose a model with "meaning at work" at the apex, which they
maintain is borne out by the research carried out into meaning at work. In this context,
Penna (2007) defines meaning at work as the situation where a job brings fulfilment for
the employee, through the employee being valued, appreciated, having a sense of
belonging and congruence with the organisation and feel like they are making a
contribution. In this model, as the hierarchy ascends and the organisation successfully
meets each of these engagement factors, the organisation becomes more attractive to new
potential employees and becomes more engaging to its existing staff.

Figure 4.2 Penna (2007) model of hierarchy of engagement

Source: Penna (2007)

4.7 Interestingly in this model the 'hygiene' factors appear at the foundation of the model,
indicating the nature of these factors as a necessary, but not sufficient, building block
upon which the organisation must further develop in order to engage staff.

4.8 Work by Schmidt (2004) (see figure 4.3) frames engagement within the context of
organisational health and Workplace Well-Being 4 ( WWB). Engagement is defined by
Schmidt (2004) as the overarching label that brings employee satisfaction and
commitment together. This model highlights the importance of commitment to the job as
driven by job satisfaction, and also notes the importance of the supportive organisation.
By creating the right conditions to generate high levels of employee engagement, the
organisation can drive high performance - with high performance being defined as the
achievement of the overarching public sector goal of advancing the public good. The
model depicts the flow of organisational dynamics that begins with recruitment and
moves through support for work, to workplace well-being, to engagement and finally to
high levels of organisational performance.

Figure 4.3 Schmidt (2004) model of organisational dynamics in the public sector
Source: Schmidt (2004)

4.9 This model implies that the foundations of engagement lie in policies to recruit and
retain the right workforce ( i.e. in terms of employing specific competences, knowledge
and experiences required for success as well as diversity) and to promote health, safety,
and well-being. Schmidt (2004) bases the model on a variety of studies and writings,
implicit in which is the notion that it is WWB that drives engagement. CIPD (2007a)
concurs with this view of the importance of well being, stating that engagement is 'wholly
consistent' with an emphasis on employee well-being.

4.10 In Schmidt's (2004) discussion, WWB itself is driven by commitment and job
satisfaction, which in turn are determined by a number of factors. It is a similar idea to
the model presented by Robinson et al (2004) where 'feeling valued and involved' was the
key driver of engagement, but in turn was influenced to a varying degree by a range of
factors. As is the case throughout much of the literature, Schmidt (2004) does not present
a definitive list of the drivers of commitment and satisfaction (as the drivers of
engagement) but reviews several studies and reports. Concentrating here on the studies
presented by Schmidt (2004) that appear to be based on a more robust approach ( e.g.
regression analysis as opposed to theorising) the following results are of interest:
4.11 WorkUSA (2000) - This survey used regression analysis to identify the key factors
affecting employee commitment:

• Trust in senior leadership

• Chance to use skills
• Competitiveness of rewards
• Job security
• Quality of company's products and services
• Absence of workplace stress
• Honesty and integrity of company's business conduct

4.12 ERIN Research - The Region of Peel (a large municipality in Ontario, Canada)
carried out an employee survey in 2002. Schmidt (2004) advocates the robustness of the
results, from the Canadian public sector, due to the use of 'advanced statistical techniques'
and 'excellent' return rates on the survey of 72%. The survey identified job satisfaction
and commitment as the drivers for the engagement model, with the following factors
found to be important to each:

Job satisfaction:

• A career path that offers opportunities for advancement;

• Fair pay and benefits;
• The perception that the municipality offers good value to customers;
• A satisfactory work environment, as defined by:
o A reasonable workload;
o Good relations with immediate supervisor;
o Smoothly functioning organisational dynamics;
o Good relationships with colleagues; and
o Effective internal communication.

Commitment:

• Job satisfaction;
• A career path that offers opportunities for advancement;
• A positive perception of senior management; and
• The perception that the municipality offers good value to customers.

4.13 The analysis of the survey found a correlation between satisfaction and commitment
of 0.57 suggesting that the two concepts are related but deserve separate analysis. Further,
what also emerges from these results is that satisfaction is a driver of commitment, but
not vice versa, as commitment does not appear as a key factor in the analysis of what
drives satisfaction.

Management and communication

4.14 The importance of good management and effective communication has been
highlighted as key vehicles through which employee engagement can be implemented. As
Robinson et al (2004) highlight, organisations must work to engage employees and
establish a two-way relationship between the employer and employee. Michelman (2004)
notes that the defining contribution of great managers is that they boost the engagement
levels of the people who work for them. Michelman (2004) suggests that they achieve
this through concentrating on four core areas of managing people:

• Selection;
• Expectation setting;
• Motivation; and
• Development

4.15 Michelman (2004) points out that in leading engagement, great managers will seek
the right fit for a person's talent, they work to see that employees are rewarded for their
performance and they endeavour to ensure that talent is developed through progressively
more challenging and meaningful assignments.

4.16 A research report into employee engagement by Melcrum Publishing (2005) based
on a global survey of over 1,000 multinationals concluded that from an organisation's
point of view it is the senior executives that 'set the tone' of engagement in an
organisation, whatever the size. There are a number of actions and strategies that senior
management can make use of to inspire engagement among employees and motivate
them to go the extra mile. The six top drivers of engagement from the senior management
perspective were found to be:

• Communicating a clear vision of the future

• Building trust in the organisation
• Involving employees in decision making that will affect them
• Demonstrating commitment to the organisation's values
• Being seen to respond to feedback
• Demonstrating genuine commitment to employee's well being

4.17 The same Melcrum Publishing (2005) report also examined the role of line
managers in encouraging engagement. In this regard, the survey results imply that
'creating a climate of open communication' is the single most important action for line
managers in affecting levels of employee engagement, with 60% of those surveyed
claiming it is the most important element.

4.18 Regarding the importance of communication, Moorcroft (2006) discusses the

restructuring that took place at the Royal Bank of Canada ( RBC) in 2004. It was noted at
that time that there was a need to engage rather than inform employees and thus better
align their performance with the organisation's vision and business goals. Formerly,
communication strategies had focused on informing employees and creating awareness.
However a new strategy was designed by the company in order to engage employees (and
thus generate desired behaviours) that would help create outcomes (measurable effects) in
support of the organisation's objectives.

4.19 The strategy has four key objectives:

i) Help employees develop a better understanding of how what they do relates to the
organisation's vision, strategies and goals;

ii) Create a more dynamic and interactive communication environment that involves
employees in thinking about and understanding how they can influence business results;

iii) Ensure employees are getting the information they need to help frame and guide their
day-to-day decisions; and

iv) Promote and recognise the desired behaviours and outcomes in communication.

4.20 This strategy is illustrated by RBC in the following model:

Figure 4.4 RBC's new model of employee communication

Source: Moorcroft (2006)

4.21 Moorcroft (2006) notes that the 'old' model was focused on developing tactics and
methods by which to inform employees, or create awareness, of company news and
objectives. However, the new model (see figure 4.4 above) is based on engaging
employees in the communication process in order to achieve the desired outcomes and
thus build the business value. This is achieved by helping employees have a better idea of
how what they do impacts upon the organisation and by promoting behaviours that help
achieve organisational objectives. Moorcroft (2006) reports that the changes to employee
communications are beginning to show solid results, with employee alignment and
engagement scores improving. Interestingly, the communication budget has actually been
reduced at the same time, illustrating that a more focused and thought through strategy
can result in better value for money.

The role of engagement in organisational outcomes

4.22 This section discusses the models that illustrate the place of engagement in the wider
operations of the organisation and the mechanisms through which engagement can impact
on the wider context.

4.23 The elements of various models that illustrate the nature in which engagement can
have an impact upon the organisation. Heintzman and Marson (2006) use the private
sector service-profit chain model as a basis for producing a public sector equivalent (see
figure 4.5). They base the model on research carried out in Canada on what the top public
sector challenges are, namely;

• Human resource modernisation;

• Service improvement; and
• Improving the public's trust in public institutions.

4.24 Heintzman and Marson (2006) point out that the private sector has, for over a
decade, documented the links between employee engagement and client satisfaction, and
between client satisfaction and bottom line financial results. The authors note that the
third element (the bottom line) cannot be transferred directly to the public sector but
based on research on the link between public service outcomes and the public's rating of
overall government performance, they suggest the following public service value chain:

Figure 4.5: Heintzman and Marson's (2006) public sector value chain

Source: Heintzman and Marson (2006)

4.25 Whilst Heintzman and Marson (2006) state that work is still underway to document
the drivers of employee engagement with respect to this model they state that possible
candidates (based on secondary research quoted within the paper) are:

• Support for the goals and mandate of the organisation;

• Effective leadership and management;
• Supportive colleagues and work unit;
• Tools, authority and independence to do the job;
 • Career progress and development; and
• Workload.

4.26 Heintzman and Marson (2006) cite emerging Canadian evidence that supports this
concept. They suggest that by understanding the drivers of engagement and the link
between engagement and performance of the institution, this tool can be used across
public sector management to make significant improvements in employees' work and in
the overall performance and perception of the public sector.

4.27 A model produced by the CIPD (2006c) and presented in the organisation's
Employee Attitudes and Engagement Survey' of 2006, brings various elements of
employee engagement together in one overarching model (see figure 4.6). This then
formed the basis of the survey, which was carried out across the private and public
sectors.

4.28 The model, which illustrates the linkages and important factors in each of these
elements, is provided below, with arrows indicating directions of influence:

Figure 4.6: The CIPD (2006c) model of employee engagement model

Source: CIPD (2006c)

4.29 Individual factors are those such as gender, age, ethnicity and disability (discussed in
more detail later in this chapter). Working life describes factors such as occupation, hours
of work and pay, as well as important issues such as bullying or workplace harassment.

4.30 Management, leadership and communication refers to how employees view their
managers and leaders, how much opportunity they have to participate in organisational
decision making and levels of trust. As CIPD (2006c) highlights, these factors have been
found in research to be very important in determining levels of engagement. This is also
the area where managers can have an important influence.

4.31 Attitudes to work refers to employees' perceptions of their jobs and includes levels
of well-being, satisfaction, enthusiasm, commitment and loyalty. It is important to note
here the two-way interaction in this model between attitudes to work and engagement.
Whilst satisfaction, commitment, stress and loyalty factors feed into levels of
engagement, it follows from the model that organisations that successfully engage their
employees will engender greater levels of job satisfaction and loyalty, for example.

4.32 The engagement box itself refers to the CIPD's (2006c) three types of engagement
(as discussed in section 2.21 above) - cognitive, emotional and physical. Finally, in the
model above, engagement and attitudes to work lead to outcomes for the organisation, in
terms of individual performance, intent to quit and absence levels. The model was used
by CIPD in their annual attitude and engagement survey, with the finding that there is in
fact a lot that managers and leaders can do to drive up engagement. Levels of trust and
confidence in senior management and line managers were found to be 'disappointingly
low' in the survey, however CIPD (2006c) cites this as an opportunity for managers to
evaluate how their own organisation compares with the national sample and to consider
how best to harness the engagement levels of their own workforce.

Power of employee Engagement:-

By now, many of us have heard the buzz on employee engagement – so much so

that the buzzword is loosing its value. Talent management and employee
engagement, just like other buzzwords and business fads, really do have value – if
we understand their true meaning and don’t let them get diluted with
misconceptions.

Engagement goes beyond the good employee or the good company citizen.
Employee engagement is the extent to which employees put discretionary effort
into their work, in the form of extra time, energy and brainpower.

Think about it… When companies are often trying to improve performance with
fewer people and decreasing resources due to cutbacks and financial pressures,
discretionary effort is the grail managers are seeking. Employees who freely give
that extra effort are of tremendous value.

General studies show that a 5% increase in employee engagement results in a

2.5% increase in growth. Growth measured by company value, which in the public
sector is measured by stock value.

The relationship between employee engagement, high performance, and company

growth is compelling to say the least. Unfortunately, national surveys of company
managers show an overall dissatisfaction with employee engagement levels and
measures of employee engagement show a very distressing picture...
The Three Levels of Employee Engagement

Highly Engaged employees are builders. They want to know the desired
expectations for their role so they can meet and exceed them. They're naturally
curious about their company and their place in it. They perform at consistently
high levels. They want to use their talents and strengths at work every day. They
work with passion, and they have a visceral connection to their company. And they
drive innovation and move their organization forward.

Moderately Engaged to Not Engaged employees are the largest group. Those that
put their time in and take a wait-and-see attitude towards their job, co-workers,
and employer. They aren’t a negative force at work but neither are they a positive
force.

Actively Disengaged employees are those fundamentally disconnected from their

jobs. The actively disengaged counter the productivity of engaged and highly
engaged employees. They miss an average of 3.5 days more than other employees
and cost the U.S. economy between $292 billion and $355 billion per year.

For most businesses, only 14% of their employees are highly engaged and
upwards of 24% are actively disengaged.

(I’ve seen these numbers vary – from a low “highly engaged” number of 5% to a
high of 17%, and a low “actively disengaged” number of 19%.)

The Cost of Low Employee Engagement

So what is the cost? Let’s assume...

• A business has a payroll of ten million dollars.

• Highly engaged employees are 90% productive (probably higher).
• Moderately engaged and not engaged employees average out at 70%
productivity.
• Actively disengaged employees are 50% productive (probably lower).

And we’ll adjust the breakdown to more favorable numbers (and easier math)…

• 15% are highly engaged employees and are 90% productive.

.15 * .90 * 100 = 13.5% productivity.

• 65% are moderately engaged employees and are 70% productive.

 .65 * .70 * 100 = 45.5% productivity.

• 20% are actively disengaged employees and are 50% productive.

.20 * .50 * 100 = 10.0% productivity.

Overall productivity level = 13.5% + 45.5% + 10.0% = 69%.

$10,000,000 annual payroll * 69% productivity = $6,900,000 ROI.
or
$3,100,000 lost on unrealized productivity.

However, it gets worse. The 19% to 24% of actively disengaged employees not
only give a comparatively low level of effort, they undermine the efforts of others
thus decreasing the effective productivity of the entire staff. Furthermore, if these
employees are in customer-facing roles, they can cost the company current and
new business.

The really scary part is that national averages show the number of actively
disengaged employees going up - from a low of 16% in the mid 90’s to a high of
up to 24% today.

What Can We Do To Increase Engagement?

The most critical element to employee engagement is the front-line manager.

Managers need to discover and develop employees' talents if they want to keep
them engaged.

Employees must have a strong relationship with, and clear communication from,
their manager.

Managers have to challenge employees within their areas of talent, and then help
them gain the skills and knowledge they need to build their talents into strengths.

Managers should help employees develop ownership of their goals, targets, and
milestones, so employees can enhance their contributions to the company and
increase their impact.

In this article I discussed what employee engagement is, the cost and
consequences of low levels of engagement, and touched on what managers need to
do. Next time, we’ll delve into more detail about what managers and leaders must
do to measure and increase engagement levels and thus productivity and company
growth.

In the last article on employee engagement, we talked about what

engagement is, the relationship between employee engagement, high
performance, and company growth, and the cost of low employee
engagement levels.

In this article, I want to focus on what a manager can and needs to do to raise
levels of engagement. But first, let's build a little on the definition of Employee
Engagement ...

We stated in the last article that employee engagement is "the extent to which
employees put discretionary effort into their work, in the form of extra time,
energy and brainpower". A good definition to be sure but there's more to it than
that.

Employee engagement can be broken down into two areas - the first being
emotional and the second, rational. Within these we can define 9 core statements
that characterize engagement.

The 9 Core Statements of Engaged Employees

Emotional

1. I would recommend my company to a friend as a good place to work.

2. My company inspires me to do my best work.
3. I am proud to tell others I work for my company.
4. My job provides me with a sense of personal accomplishment.
5. I really care about the future of my company.

Rational

1. I understand how my unit contributes to the success of my company.

2. I understand how my role is related to my company's overall goals,
objectives, and direction.
3. I am willing to put in a great deal of effort beyond what is normally
expected to help my company succeed.
4. I am personally motivated to help my company be successful.

Obviously, an employee who would make these statements is highly engaged, but
our topic today is how to increase the level of engagement in those employees who
would not make these statements.
Managers Make The Difference

As was concluded in part 1, the most critical element to employee engagement is

the front-line manager.

1. Managers need to discover and develop employees' talents if they want to

keep them engaged.
2. Employees must have a strong relationship with, and clear communication
from, their manager.
3. Managers have to challenge employees within their areas of talent, and then
help them gain the skills and knowledge they need to build their talents into
strengths.
4. Managers should help employees develop ownership of their goals, targets,
and milestones, so employees can enhance their contributions to the
company and increase their impact.

But saying it doesn't get it done. Managers need to know how to do these things
and, sad to say, most MBA programs don't teach it.

Additionally, managers cannot do it alone. The organization must adopt a "talent

management" culture in order to make engagement initiatives successful.

That being said, let's look at a few critical fundamentals that will lead to positive
results.

Four Fundamental Actions Leading to Positive Results

1. Clarify Expectations

Create Goal Statements that formalize the following:

• What is to be accomplished
• Who will be involved
• When the activity will be completed
• How much it costs and which resources will be used

Evaluate work against measurable standards

-Positive Results will most likely include:

For the employee -

• Less frustration and stress - clear direction

 • Higher level of motivation and satisfaction
• A common or shared language
• More effective communication with manager

For the manager -

• More effective communication with team member

• More focused and productive team member
• Higher productivity and accomplishment of business goals
• A common or shared language

2. Don't Leave Employees Out Of The Plan

Even the best plan can fail if the employees are not committed to it
Get Commitment
Get Accountability

-Positive Results will most likely include:

For the employee -

• Higher level of motivation and engagement

• Ownership to the process and to their own development
• Commitment and accountability to the plan

For the manager -

• A better performance plan overall - dual input

• Higher level of commitment and accountability from team members
• Streamlines work processes, saves time and money

3. Meet On An On-Going Basis To Share Feedback

Increase effectiveness of communication

Increase competence and confidence
Increase productivity and accuracy
Encourage a higher standard

-Positive Results will most likely include:

For the employee -

 • Recognized for what they are doing well
• Learn if "off course", receive guidance, and improve performance
• Clearer sense of what's expected if goals change
• Less frustration and stress due to more timely feedback and input

For the manager -

• Time and opportunity to provide critical feedback

• Learn valuable information and gain insights
• Increased commitment, quality standards and productivity levels
• More insight into potential talent and development opportunities
• Increased quality of communication
• Increased levels of credibility and trust w/ team members

4. Providing Factual / Behavior-Specific Feedback

Give specifics and facts of performance

Be clear about what changes are needed
Provide objective guidance and direction
Focus on behavior vs. attitudes or personal characteristics
Solve problems and move forward

-Positive Results will most likely include:

For the employee -

• Commitment and accountability to changing their behavior

• Feels treatment is fair, professional
• Information provided is tangible, practical and actionable

For the manager -

• Clarifies performance outcomes

• Cultivates a more healthy environment
• Increases levels of credibility and trust w/ team members
• Focused team members, leading to:
o More timely results
o More accurate results
o More productive teams
Essential Reading
A road map for employee engagement
Now that we have identified the key drivers of employee engagement, how can we
start to create – and implement - a road map for achieving outstanding
organisational performance?

Attitude and engagement creates turbulence in corporate America

Corporate America is not aligned with the needs and requirements of its
increasingly diverse workforce and radical changes in attitudes mean that a
growing number of young Americans are dissatisfied, disengaged and
unproductive.

A is for Apathy
A quick search on Amazon reveals not one single business book or pamphlet about
overcoming apathy. And yet anyone who been a manager for more than a week
must surely recognise that proving that effort is worthwhile is the real essence of
leadership.

Employee disengagement a global epidemic

At a time when companies are relying on their workforces to achieve growth, a
major new survey has found that only one in seven employees worldwide are fully
engaged with their jobs and willing to go the extra mile for their companies.

Employee engagement: What exactly is it?

The notion of employee engagement is causing a big buzz in management circles
at the moment. It's a topic that employers and employees alike think they
understand, yet often can't articulate very easily. So what exactly is it?

Employee engagement: the what, why and how

Employee engagement is the new Holy Grail for organisations worldwide. But
what exactly does it mean? Why is it so important? And if you haven't got enough
of it, how can you get some more?

The keys to employee engagement

Keeping your employees engaged really isn't rocket science - it's just a metter of
listening, learning and leading by example.

Managers critical to employee engagement

Managers' behaviour has a huge impact on the work climate and is a critical
component in employee engagement and motivation. Yet too many reward
programmes simply focus on money and ignore this human factor.
Engage me or enrage me

More managers and leaders ask me "how to engage" and, "how to innovate" than
any other question. As well they might, given that so many of us have to disengage
just to survive their endless ill-conceived meetings, badly-laid plans, and the
waste, day by day, minute by minute, of our lives.

Latest on Employee Engagement:-

Recession promps a rat race re-evaluation
In tough times, many organisations slip into treating people badly. But with half of
workers considering down-shifting to a more fulfilling job, poor employers could
find their offices rapidly emptying when things pick up.

Conflict can be a force for good

Never mind about emotional intelligence, empathy or consensual leadership, what
really drives workplaces is passion, ambition and even conflict.

Are people really your most important asset?

Many companies proclaim that their employees are their greatest asset.
Unfortunately, the phrase has become somewhat cliché, similar to saying
employees are "empowered." These are valid statements only if companies put
actions behind their claims.

A little respect
Whatever our age, it seems Aretha Franklin was right. What most of us want from
work is simply to be managed with a little respect.

Fear brings loathing, not harder work

In the current climate it's easy to ignore the career needs and motivations of your
workers. But assuming your team will go the extra mile just because they feel
lucky still to have a job is a big mistake.

Making sure not everybody hurts

It's a tough thing to ask when times are so tough, but it is now even more
important that senior executives find time to provide encouragement, advice and
support for their people.

Cut in haste, repent at leisure

Before cutting jobs, take a deep breath and consider whether this is really the
answer to your woes, or whether it simply create even more problems down the
line.
I'm a manager, get me out of here
Most managers are a bundle of nerves who would prefer to be back in the ranks
rather than leading their teams through the worst recession in a generation.

Time to rethink your job

Is it possible to get staff more engaged and committed just by changing how they
think about their work? A new Canadian study has suggested that it is.

Economic crisis drains morale

With the news full of yet more job losses, it's not surprising that worries about job
security are having a significant impact on productivity, engagement and the
general working environment.

Demoralised, demotivated, dysfunctional

Just when they thought things couldn't get any worse, many organizations are
seeing employee morale plummet as long hours, anxiety and stress tends sends
productivity levels through the floor.

A cultural conundrum
Robert moved from the UK to a management job in China a year ago. While
things went well at first, one of his team has recently been openly challenging his
working-style and being dismissive of his decisions. What should he do?

Looking after talent is vital in a downturn

In the current climate, you might have thought that organisations would focus on
containing costs and managing employees out of the door. In fact the opposite is
the case.

US workers left cold by their leaders

Nearly half of American workers rate their immediate supervisor more highly than
their boss, viewing their senior executives as uninspiring, demotivating and stuck
in their ivory towers.

Positive thinking: does it really get results?

The idea that positive thinking can affect our lives for the better has been gaining
momentum over the past 80 years, and even more so recently. So does the concept
work? I dare say it does - within reason.

Generation Y the least engaged

The knives are out again for Generation Y as a new survey finds that in almost all
parts of the world, employees born since 1980 are the least engaged members of
the workplace.
Five simple keys to building solid teams
When I ask teams what they would like from their supervisors, the same simple
things keep coming up. You might think they're obvious - but if they are, teams
wouldn't continually be mentioning them!

The rise and rise of the four-day week

A four-day work week might seem like a radical way to cut energy consumption,
but it is gaining acceptance among state governments across the U.S. and looks set
to spread further still.

Get rid of managers and we'll all be happier

It's not the lack of money, the daily commute or even the mindlessness of what
they are doing that makes workers feel most unhappy. It is - you guessed it - their
managers.

Pare back perks at your peril

In a downturn cutting back on benefits may seem like a win/win decision. But
according U.S business school Wharton, firms that take an axe to their perks may
soon live to regret it as it.

Green credentials can boost employee loyalty

With rising fuel prices hitting workers' wallets, an employer's green credentials are
becoming an increasingly important retention tool as well as something nice to
have from a brand perspective.

What are you doing to increase trust?

Without trust, there's no passion or desire for excellence. Employees stop
contributing, valuable new ideas are never brought the table and bad ideas are
never challenged. An organization suffering from these conditions eventually
becomes incapable of correcting its own mistakes.

Managers fail to live up to expectations

Seven out of 10 employees still trust their bosses highly, despite the fact that the
vast majority of managers generally fail to live up to their expectations and
aspirations.

Meetings and emails take the happiness out of work

It's official. Endless meetings and the constant deluge of emails really do drain
most of us of the will to live, let alone work effectively.
Is your work an obligation or an opportunity?
People tend to see work either as an obligation, overbearing, or an opportunity.
And if you want to take the opportunity to rise above the mundane and "make a
difference", try thinking like an entrepreneur.

Bitter workers feel ignored and overlooked

The modern workplace is a hot-bed of simmering resentment, with workers feeling
ignored and overlooked and preferring to communicate by email rather than
actually speaking to each other.

Americans bitter as the dream turns sour

Half of US workers believe that the American dream of a nice home, financial
security for you and your family and hope for the future is now unattainable.

Are you dead on the job?

Here's a challenge for you. Find someone doing something good today and tell
them what a good job they're doing. Because praise is the thing that motivates us
the most, even though it takes so little time and costs nothing.

Avenues for employee complaints seem to be closed

A prime reason for employee unhappiness is that companies do not adhere to a set
of standards. Some are too forgiving of employee misconduct, while others are
managed by people who themselves overstep boundaries and could care less about
rules.

What makes managers tick

Interesting and challenging work is what drives most managers to go the extra
mile, not performance-related pay, cash bonuses or a stake in the business.
Earlier Stories on Employee Engagement . . .
Passion and purpose at work

Engagement crisis could tip UK into recession

The kids are all right

Thank you costs nothing, but is worth a fortune

Four out of 10 managers sap the will to work

U.S. workers are more loyal, but only when they're old

Lions led by donkeys

Employee engagement has a ring to it

Getting to the heart of the disengagement gap

Why loyalty pays

The many faces of employee engagement

Can we stop the rot?

British bosses are bullying bureaucrats

Clarity the key to employee engagement

Work-life grumbles are a sign of deeper management failings

Good communication boosts the bottom line

Workers prefer tough love

In praise of praise

Even high-flyers need a bit of support

Trust the boss? No chance

Managers fail to find out why staff leave

The disengagement gap

Third of workers don't rate their boss

Are corporate leaders losing the plot?

Secrets, lies and career plans

Unlocking the power of ownership

Is corporate America cutting its own throat?

Measuring employee communication

Sliding loyalty causes retention headaches

Why manners matter

Stock options aren't enough to keep employees engaged. You need state-of-the-art
communications that can drive performance and in an environment that employees
want to be every day. Employee engagement leads to employee retention, higher
customer productivity, motivated employees and profitability. And we're here to
help you achieve those results.

See for yourself. Here's how to get started:

1. Get a free eNewsletter. Sign up for The Engagement Report by completing the
form to the right. Written by engagement expert Linda Dulye, The Engagement
Report will bring you the latest news and information on successful engagement
programs around the world.

2. Brush up on your skills. View Ragan's calendar of upcoming events to choose

the conference, workshop or teleseminar on employee engagement that's right for
you.

3. Listen to a multimedia CD. Hear a CD recording of our teleseminar on

employee engagement: The new rules of engagement for executive messaging. Or
choose another multimedia CD on how to improve employee retention and
increase employee productivity.

4. Start talking. Jump into the conversation about employee engagement on

Ragan's message boards.

5. Take a peek at our archives. Read about employee engagement, employee

productivity and employee retention in these informative articles:

• Rules of employee engagement

Motivating employees? Companies are getting a whole lot better at it
• Employee engagement: It's not about communications, stupid
After two days of talking about employee engagement, one thing became
abundantly clear: It's really hard to do, and very few people are doing it
well

• Get Engaged:
Why companies are paying close attention to employee engagement and
what it means to you

• Does engagement work?

A new book tackles what drives employee productivity and employee
retention
Review of literature:-

1.) Merit board links employee engagement and productivity

By Brittany R. Ballenstedt bballenstedt@govexec.com November 18, 2008

Employees who are fully engaged tend to work in offices that achieve better
program results, call in sick less often and stay with their agencies longer,
according to a new report by the Merit Systems Protection Board.
The report, which is based on results from a 2005 survey of nearly 37,000
employees at 24 federal agencies, found that despite dwindling resources and
increased pressure to improve programs, agencies can thrive if managers connect
with their employees.
"Federal supervisors and managers have an important role to play in engaging
employees," said MSPB Chairman Neil McPhie. "Those who are successful in
engendering these attitudes will lead a more engaged workforce that will produce
better outcomes for their agencies."
The survey found that about one-third of federal workers considered themselves to
be fully engaged, while almost one-half are somewhat engaged and 17 percent are
not engaged.
The report noted a connection between levels of employee involvement and
specific outcomes, though the cause and effect were not always clear. Higher
levels of employee engagement correlated with higher scores on the results and
accountability portion of the Office of Management and Budget's Program
Assessment Rating Tool.
Additionally, employees at the five agencies with the best engagement levels used
an average of nine sick days in 2005, while those at the five agencies with the
most apathetic workforces took off an average of 12 sick days. Finally, only 17
percent of the nonretirement eligible employees who reported they were "very
likely" to leave their agencies within the next year were engaged, while 36 percent
classified themselves as "somewhat engaged" and almost 47 percent put
themselves into the "not engaged" category.
There were differences in the level of employee job involvement among different
groups of federal employees, the report noted. For example, Senior Executive
Service members told of higher levels of engagement than supervisors, who, in
turn, were more invested in their work than nonsupervisors. Employees with
higher salaries and more education also tended to be more engaged, according to
the report.
Employees at the Air Force, Army, NASA and the State Department reported the
highest levels of engagement, while employees at the Federal Deposit Insurance
Corporation and the Homeland Security Department reported the lowest. MSPB
said the nature of an organization's work and its management practices, culture,
mission and overall stability were important factors in piquing employees' interest.
The board recommended that agencies foster engagement by improving new hire
marketing, encouraging networking and rotating employees to different teams or
organizations.
Employees also should be shown that they are valued from their first day on the
job, MSPB said, and agencies should have mentoring programs to help them
define their roles. In addition, supervisors should use the various phases in the
performance management process to provide guidance and feedback and to tell
employees how their work contributes to the agency's overall mission.
Finally, MSPB said, agencies should measure employee engagement periodically
and energize the workforce if it is found to be lacking.
"By establishing a link between employee engagement and agency outcomes, we
hope to refocus attention and energy on management practices that can increase
the level of employee engagement in federal agencies," McPhie said.

2.) Engagement equals productivity

Johann Tasker 05 October 2004

Employee engagement is a trusted motivational tool, yet only the most high-
profile organisations are truly taking it seriously.

If you were to ask people what it means to get engaged, most would probably
glaze over and talk about true love, diamonds and wedding cake. Not Bob Arnold,
director of strategy and human capital management at HR consultancy,
Chiumento.

Arnold is more likely to define engagement as a beneficial two-way relationship

where employees and employers 'go the extra mile' for one another. Companies
that get it right reap the rewards and so do their employees, he said.

The benefits of having happy staff are well-documented. But the challenge for
many organisations is showing that engagement brings a tangible return on
investment - a process many companies find elusive.

"Engagement means different things to different people," Arnold said. "There was
a risk that it would become just another buzzword, so settling on a definition gave
us a lot of debate."

With this in mind, Arnold embarked on a study with Personnel Today to find out
what engagement meant to professionals in different organisations. The study,
called Get Engaged, measured engagement levels and whether companies felt they
were making progress.
The results, drawn from a survey of 400 HR professionals conducted via the
Personnel Today website, are surprising. One in four organisations admitted that
staff were not engaged. A similar number said the situation had worsened in the
past year. And 44 per cent said that tackling engagement was an overwhelming
challenge.

"While many claim to be actively tackling the issue, it is worrying that a

significant number don't know where to start," Arnold said. "But if you don't know
where you are, it's difficult to know where to go."

Asda topped the list of companies most admired for its abilities to engage staff,
followed by Microsoft and Virgin companies. But manufacturing and retailing
rank staff engagement lower than any other sector.

"The bigger companies have the money to spend on engagement and publicity,"
Arnold said. "But I don't decry the PR because it's good that the importance of
engagement is highlighted."

Board directors appear to have their heads in the clouds, according to the research,
with 69 per cent believing that engagement levels in their organisations had
increased in the past 12 months. Only 38 per cent of HR managers agreed with
them.

This difference might be because directors rarely come into direct contact with the
feelings of employees on the shop floor, instead basing their opinions on the
feelings of managers with whom they have regular or day-to-day contact.

A more likely theory might be that directors are overly optimistic because they
base their opinions on what they are told. Sometimes, junior managers feed them
an overly rosy picture of company life in an attempt to show all is well.

Some obstacles to engagement included lack of time (48 per cent), lack of
knowledge (40 per cent) and proving return on investment (40 per cent). But
poorly skilled line managers were seen as the biggest barrier, with 50 per cent of
HR managers saying it was a problem.

Arnold said such a response was understandable, but he warned that line managers
are an easy target. They are, he said, often unfairly blamed and are expected to
have a sixth sense when it comes to influencing an organisation's culture.

"Putting in a new manager will change the level of engagement, but it could rise or
fall. We should be concentrating on better communication and coaching our
managers to do what they do best, while addressing their problem areas."
Measuring the benefits of engagement can be especially hard for some
organisations. Better job performance tops the list of benefits, but some firms do
not measure engagement at all. Others mistakenly measure levels of absenteeism.

"Measuring engagement by looking at absenteeism levels is like looking in the

rear-view mirror while you are driving a car," Arnold said. "It tells you where
you've been rather than where you're going."

Other popular measures include staff turnover (67 per cent), staff opinion surveys
(60 per cent) and achievement of targets (42 per cent). But, Arnold said, the
biggest benefit of engagement is the value added per employee.

High staff turnover rates in the retail sector, for example, mean most employees
never stay long enough to get engaged. Similarly, the spectre of job losses means
building engagement in a manufacturing company can be a big challenge.

Arnold said despite the efforts of the HR managers, no one will stay engaged in
the same job forever. The level of engagement will wax and wane, he said.

A third of respondents said engagement levels were static. And where levels had
fallen, just 48 per cent of firms were doing something about it. But part of the
problem could be that some engagement programmes are too rigid. "There's no
easy quick fix," Arnold said. "It's an ongoing process and if one programme
provided the solution then someone would have patented it and be making a
fortune by selling it.

"My belief is that engagement cannot be addressed by a mechanistic approach," he

said. "Each situation is different and it comes back to the fact that employers and
employees must support each other."

3.) Cambridgeshire County Council -

Profile: 18,000 staff & turnover of £550m

Approach: it has had a formal people strategy since 2001 - it is clear about developing
the organisation, having a single culture, employee development and creative ways to
reward good performance. In 2005 the Institute for Employment Studies ( IES) ran a
culture audit out of which the ' Inspire Project' was born - the objective being to change
the way people work and communicate. A new framework defining 17 behaviours was
rolled out with the assistance of the Hay Group. The project included work on leadership
development, with managers - including the Chief Executive - receiving 360-degree
appraisals and team-building workshops.
It has also led to a new customer service charter and employee charter. The latter outlines
not only what the Council can expect from its employees, but also what they can expect
in return - " it is the psychological contract made explicit".

Impact: in HR benchmarks the Council has top quartile performance including absence
management, and bottom quartile costs for HR service delivery. HR even sells its best
practice to other public-sector organisations to generate revenue. The staff survey results
are very strong:

85% of employees thought they were doing a worthwhile job

84% said that managers listened to their ideas

90% felt they had the chance to give feedback during appraisals; and

71% said they had enough opportunities to raise issues of importance

" We are not a traditional authority - we seem to have more ways to get messages out and
actively listen to people than you see in most organisations."

" If you don't start with your workforce, how can you reach the public?"

" 18,000 ambassadors are better than 18,000 assassins."

4.) Rotherham Metropolitan Borough Council -

Profile: 13,500 staff

Historic Performance: in 2002 the Council was in the 'doldrums', with 1 star and rated
as 'weak' in the Comprehensive Performance Assessment. Only 24% of staff rated morale
as 'high'.

Approach: Rotherham's 'Exchange Programme' was runner up in the 'Improving

Business Performance Through Engaging Staff' category of the CIPD People
Management Awards. A representative 'Reach-in' panel that gives detailed feedback and
quarterly focus groups to handle hot topics supplemented conventional methods such as
staff surveys and an employee suggestion scheme. Through effective promotion the
number of employee suggestions increased six fold from 50 per year to 300. " Letting
people know the outcomes of their suggestions was the most important part of the
process."

The Council's wider mission to motivate and inspire is encapsulated in their

HEART approach:

• Help each other learn and develop

 • Empower through open communication
• Appreciate and respect others
• Recognise and acknowledge contributions
• Try new ideas and initiatives.

Impact:

Staff turnover is down from 18% to 9%

Average absence is down from 13.8 days to 9.2 days

Rotherham is now a three star council and rated as 'strongly improving'.

65% of staff responded that they are happy at work.

" Happy employees are more likely to come to work."

"We know staff feel valued, and confident that they are having an input into our
success as a council."

"The culture has changed from one that was progressing slowly to one that wants
to achieve, and is achieving results."

5.) CIPD (2006c): Employee variations

The final variable impacting on employee engagement relates to employees themselves.

A number of studies have produced quantitative research findings that demonstrate the
impact that biographical and job characteristics can have on employee engagement. One
of the most in-depth was conducted by the Institute for Employment Studies ( IES) (as
analysed by Robinson et al 2004) which analysed attitude survey data for 2003 from 14
organisations in the NHS (>10,000 completed questionnaires). The key findings were:

Biographical characteristics

• Gender - the difference in engagement scores between men and women was not
significant (although note that some surveys (see CIPD 2006c discussed below)
find that females are generally more engaged than males - this difference may be
due to the fact that the NHS study surveys across employees within the same
organisation, whilst the CIPD survey cuts across a wide variety of industries and
organisations).
• Ethnicity - minority ethnic employees have higher engagement levels than their
White colleagues. Black, Chinese and Asian employees have higher scores than
those in Mixed and White groups.
 • Age - engagement levels go down slightly as employees get older - until they
reach the oldest group, 60 and over, where the highest engagement levels of all
are displayed. The high level of engagement levels expressed by experienced
employees, who may be considered to be approaching the end of their working
lives, suggests an untapped source of potential in many organisations.
• Work-life balance - those in their 40s and 50s have the highest levels of
workplace stress and are likely to find it difficult to balance work and home life.
Robinson et al (2004) therefore suggest that attention to family friendly policies
could increase the engagement levels for this group.
• Caring responsibilities - the need for a family-friendly approach and greater
emphasis on work-life balance is further underlined by the fact that employees
with caring responsibilities for children have significantly lower engagement
levels than those who have no caring responsibilities.
• Medical - those with a disability/medical condition have lower engagement levels
than those who do not have such a condition.

CIPD (2006c) in their national survey of 2,000 employees across a wide spectrum of
public and private sector employers found broadly similar findings to the NHS survey,
although several disparities are noted:

• Gender - women were found, in general, to be more engaged than men, but they
also tend to be doing different kinds of jobs. Women are more satisfied with their
work and hold more positive views of their senior management team than do men.
They are more loyal to their organisation as an employer and report higher levels
of loyalty to their customers and clients than men. This is in contrast to the NHS
survey result conducted by IES and analysed by Robinson et al (2004), where it
was found that there was no discernable difference between engagement levels
between men and women. As discussed above this may be due to the fact that the
NHS study surveyed employees across the same organisation whilst CIPD
(2006c) cut across a range of different industries and organisations. This may
suggest that males and females are responding in a similar fashion to the same
NHS environment but that in general differences in male/female engagement may
be due to participation in different occupations and industries.
• Age - workers aged 55+ are more engaged with their work than younger
employees, and they are also happier with their work-life balance, working
shorter hours than others. Employees aged under 35 are significantly less engaged
with their work than older workers. Again this is contrast to the NHS results
where it was found that engagement levels go down as age increases, although
both surveys find that workers in the 55+ or 60+ bracket are more engaged.
• Disability - employees with a disability are less engaged due to a range of
negative factors including: bullying and harassment, not being listened to, the
stress of work, a feeling of less control over their work, and higher levels of
anxiety.
• Managers - they find their work more important and more meaningful than non-
managers do. Their responses on communication and involvement are much more
 positive than those of non-managers, and managers feel that they have more
support and recognition and are listened to more than non-managers are.
• Flexible contracts - some surprisingly strong differences were found between
those working on a flexible contract ( e.g. flexible hours, term time contracts,
homeworking etc.) and other workers. Those on flexible contracts tend to be more
emotionally engaged, more satisfied with their work, more likely to speak
positively about their organisation and least likely to quit than those not employed
on flexible contracts.

However, it is particularly important to point out that demographic variables should not
be seen in isolation as predictors of performance or engagement. CIPD (2006c) stresses
the following:

"…what we have found is that good management practice and a conducive working
environment can lead to high levels of engagement and performance amongst all groups
of workers."

CIPD (2006c) also note the following regarding job characteristics:

• Job group - the nature of the job makes a big difference to engagement levels. In
general, managers and professionals have higher levels of engagement than do
their colleagues in supporting roles.
• Working pattern/hours - full-timers are significantly more engaged than part-
timers, while employees who work days are more engaged than their colleagues
on shifts or on a rota. This suggests that employers need to work harder with
people who are not necessarily at work during 'standard' working times - to ensure
that they receive communications, are managed effectively and have opportunities
to grow and develop in their jobs.
• Length of service - engagement levels go down as length of service increases - an
indication to employers that they need to ensure that longer-serving employees
continue to be exposed to new and interesting challenges.

6.) B&Q -

Profile: Europe's largest home improvement retailer. UK employment growth doubled

from 17,500 in 2000 to 35,000 by 2003.

Approach: Since 2000, B&Q has used a 12-question survey developed by Gallup, on
seven occasions to measure employee engagement - defined by the degree to which
workers are emotionally committed to their jobs. Employees respond to each of the 12
questions on a scale of 1 (strongly disagree) to 5 (strongly agree) on a range of topics
related to employee needs in the workplace such as friendships, pay, benefits, progress
reports, and job related growth opportunities. High scores reflect engaged employees
whose needs are being met and who are fully engaged in improving workplace
productivity. Middle of the range scores reflect workers who are not engaged, whilst low
scores imply active disengagement - those employees whose needs are not being met and
who can actually discourage productivity.

However, the survey does not merely gauge prevailing workplace sentiment, rather it is
designed to be a tool for action and strategy development. The survey asks about
aspects of engagement that can be influenced by supervisors, such as recognition and
communication. Thus depending on the outcome, managers can either plan how to
exploit their strengths and/or address the weaknesses.

Further, the survey is designed to translate the 'softer' aspects of workplace emotions and
behaviours into a hard measure of engagement, which in turn can be linked to
organisational outcomes.

Impact: The use of the Gallup survey at B&Q over 7 separate occasions has allowed the
company to build up a wealth of knowledge about what drives engagement within the
company and how engagement levels link to greater productivity, better customer
engagement and higher profits. The results of surveys have been taken forward into
actions to improve scores. Earlier surveys revealed that company-wide, scores were fairly
low, prompting management and employees alike to change their attitudes in order to
improve engagement. For example, one store scored particularly low on the question 'At
work do my opinions seem to count?' Managers changed the agenda of meetings to ask
staff if they had issues to raise, and required managers to feed back subsequently on how
the issue was being addressed.

Thus the use of the survey here highlights how an issue can be identified, and how
actions can be taken to create the environment to enable the issue to be resolved.

B&Q customer surveys reveal that stores that score highly in the engagement survey
also score higher on customer satisfaction. Translating this into organisational
outcomes, the stores in the top half of customer loyalty generated £3.4m more in sales
each year than stores in the bottom half.

7.) Towers Perrin (2003) presents a range of engagement statements, many of which
have elements common to the Robinson et al framework, including pride in being part of
the organisation, advocacy about the products and services of the organisation, being
inspired by the organisation to produce one's best work, and willingness to put in effort
above and beyond normal expectations. The full list of the Towers Perrin engagement
statements is provided below:

• I really care about the future of my company

• I am proud to work for my company
• I have a sense of personal accomplishment from my job
• I would say my company is a good place to work
• The company inspires me to do my best work
• I understand how my unit/department contributes to company success
• I understand how my role relates to company goals and objectives
 • I am personally motivated to help my company succeed
• I am willing to put in a great deal of effort beyond what is normally expected

Based on use of these statements, Towers Perrin (2003) found that just 17% of
respondents are 'highly engaged' whilst 19% were found to be 'disengaged. The
remaining middle are considered to be the 'moderately engaged'.

8.) RBS - How a major corporation uses its employee data -

Profile: The Royal Bank of Scotland Group ( RBS) has over 140,000 employees in 30
countries.

Approach: RBS has recognised that in an organisation of its size, understanding the
effectiveness of its people strategy and 'employee proposition' is a strategic imperative.
From 2003, RBS developed a human capital strategy that provides its leaders with a
detailed understanding of how effective the group is at attracting, engaging and
retaining the best people.

RBS has adopted a human capital 'toolkit' which includes diagnostic tools, benchmarking
resources and employee research and measurement tools.

RBS employs the use of comprehensive surveys which benchmark performance and
report on a variety of topics such as absence, turnover and diversity. However, the key to
the human capital strategy is its annual survey of employee attitudes delivered to all
140,000 staff. The results are communicated around the organisation and managers are
provided with an action plan so that at a local level, tangible actions are agreed and
targeted.

" This is a sophisticated, business-focused strategy within which employee attitude

surveys play a key role" (Aitken 2006 cited in CIPD (2006a))

Impact: RBS publishes its human capital measures in its annual accounts and in its
corporate responsibility report. As Aitken highlights " By reporting how our people
strategy drives business performance, we differentiate RBS Group as a great company to
work for, invest with and bank with. Sharing our approach to developing a highly
rewarding and productive workplace is a key part of this approach".

Implications for managers: Employee attitude surveys are a fundamental component of

sophisticated strategies for managing human capital. Findings on employee engagement
can be used to monitor performance, communication, diversity, leadership and work-life
balance. Combining attitudinal data with other indicators in the organisation can provide
managers with a greater understanding of the relationship between HR policies and
practices and organisational performance.
discretionary effort is the grail managers are seeking. Employees who freely give
that extra effort are of tremendous value.

General studies show that a 5% increase in employee engagement results in a

2.5% increase in growth. Growth measured by company value, which in the public
sector is measured by stock value.

The relationship between employee engagement, high performance, and company

growth is compelling to say the least. Unfortunately, national surveys of company
managers show an overall dissatisfaction with employee engagement levels and
measures of employee engagement show a very distressing picture...

9.) Schmidt 2004 defines WWB as

" a holistic approach to creating high performance organisations through

establishing the right conditions to generate high levels of employee engagement.
This approach assumes that achieving high levels of organisational performance
depends on employees who are strongly committed to achieving the goals of the
organisation, and who show this through their actions. This behavioural objective
is influenced in turn by levels of employee satisfaction, and by supportive,
respectful and healthy work environments.

10.) Ken Scarlett, USA

The Conference Board "study" of Employee Engagement is a referenced based,

not empirically based, journalistic examination of published papers and sales
materials that produces a homogenized definition based on word count frequency
inaccurately described as "meta-analysis". The Conference Board's definition sets
back scientific standardized measurement of engagement to the dark ages by
publishing this collated version of definitions drawn primarily from their financial
sponsors. Engaging employees is an art and responsibility of management made
possible only by statistically measuring 15 engagement drivers via validated
survey questionnaire instument with results reported by group and holding
managers responsible for keeping employee attitudes towards those engagement
drivers within or above the acceptable range. For those interested in a non-
mystical, empirically proven definition and practical description of engagement
see white papers at www.ScarlettSurveys.com. Be well.
11.) John Truty, Chicago

You need to ask the question ... Why have management and the academics and the
consultants been asking these questions since the dawn of the industrial era... Why
have they remolded/repackaged/re-re the same basic questions and why have they
FAILED? What is it in the basic construction of work (not the physical effort - the
construction of the institution of work) that has persisted in defeating attempts by
the "professional" to rectify the "problem"?

A re-examination of hierarchy and the distribution of benefits within the corporate

entity needs to be questioned. Questioning the standard narrative of hierarchy, who
controls work processes and knowledge would seem to be salient. And the basic
position for corporate power and the "rights" of management are central. When
reviewing the literature of labor and the working classes it would seem as if these
types of issues are central. My 30 years experience tells me that as long as
management perceives itself as have power over other classes of workers (we tend
to forget that management are workers too) that these issues will remain unsolved
and a rich source of income for a few with little change in the outcomes.... metrics
aside ... we have all experienced how surveys are created and analyzed...

These are issues of power and the benefits accrued to those powerful people ... In
my humble opinion, when the benefits of the labor of all the workers are
distributed with greater equity these issues will diminish ...

12.)M.S.Sreekumar, Trivandrum/ Cochin, Kerala, INDIA

I am practisng HR for over 3 decades. In the beginning, we were only taking

Opinion Surveys. Subsequently, we migrated to Employee Satisfacvton survey
also, on selected critical paarmeters. Criticial parameters unwent change/
refinement, as time went by. Contexualising the HR interventions & tracking thier
outcomes wer our objective. We were alost trying to identify their acceptance/
rejection & effectiveness of the HR activies were captured. We aso went throguh
Climate Surveys. Later, we also went for Employee Commitment Surveys. For the
last couple of years, we are also conducting Employee Engagaement Surveys. The
surveys output is respoed at the enterprise elvel and Corrective Action/ Preventive
Action/ Remedial Plan is put in palce, and actions taken.

13.) Tulasi, India

I feel larger companies have successfully concentrated on mechanisms/concepts to

improve employee engagement. Branding angle adds a lot to this. Employees are
more satisfied to be associated with bigger brands. In my opinion companies start
looking at the concept only after a sizable growth. Smaller organization are
focusing more on increasing business not realizing that the engaged employees
can yield better profits. It’s a learning which would come with growth. Bigger
organisations also have stronger processes in place which do not allow indivisual
interference. leaving little space to the managers to violate "walk the talk" concept.

14.) Rich DiGirolamo, www.richdigirolamo.com

When I talk with clients (and potential clients) about employee engagement I
ask them what their employees are doing to get themselves engaged. I ask
them what excites their employees. Too often we’re looking to deliver a
result or a process rather than deliver a mechanism/concept that will allow
the employee to figure it out by his or herself.

Telling your people “this is how you’re going to be engaged” is ludicrous.

It’s almost as bad as telling people you’re empowered to run with a task and
then all the manager does is steer them and correct them to do it “my way.”

Staff needs to be given far more credit. Staff ideas need to be listened to,
heard and implemented. That’s how you get engagement. If you’re going to
keep ramming things down their throats………….good luck.

And while I know some of you are envisioning chaos with this approach –
let’s just answer one question………………….Is your way working?

15.) Annette Kurer

The reason employee engagement is not articulated easily is the same as the
reason that employees are often not engaged in their job and organisation. What is
the reason? Most people's dialogue skills let them down and they are unable to
communicate with clarity or check their message is understood. Most of us have
no idea how we look and sound when we communicate we merely state our point
or command and move on. What often happens though is that the other person's
understanding and ultimate implementation of our message is different from what
we thought we'd conveyed. The impact of our communication has been impaired
by how we looked and sounded, we don't check it and we get frustrated when
some time down the line the message hasn't transformed into action in alignment
with our communication.

16.) Andy Parsley, Green Lion Insight and Solutions, UK

Look after your reputation. If the world believes that your organisation is a poor
"corporate citizen" they will tell your people. If your employees believe what they
hear they will increasingly distance themselves from the business. And if they
don't, they will get increasingly frustrated if they see that you are doing nothing to
correct these misperceptions.

Either way, organisations that proactively manage their reputations will also enjoy
higher levels of employee engagement.

17.)Phil Whiteley

To me, the research showing the importance of employee engagement is

overwhelming, and goes right back to the Hawthorne experiments in the 1930s.
The barrier to wider acceptance of the link is the illogical separation of strategic
discussions, policies for greater efficiency, etc from misleadingly entitled 'soft'
matters. We need to challenge the false metaphor that people are 'resources' or
'assets'. They're not. They are the company, and produce every asset within it.

18.) Greg Harris, Omaha, Nebraska

It's amazing that the HR community is still debating whether or not employee
engagement is a "big deal."

Employee engagement is NOT a fad. It's the byproduct of our economy's transition
from an industrial base to a service and information base. As the American
workforce evolved from laborers to knowledge workers--a power shift occurred
between employer and employee. Engagement will become the best competitive
advantage companies will exert to defend their businesses. Engagement research
ought to be performed by every company with more than 10 employees. And the
results should be scrutinized with the same vigor as financial metrics. My firm
operates "Best Place to Work" programs in 41 US markets. The winners of these
contests don't leave engagement to "chance." They are intentional about
engineering an environment where talented people flourish.

19.) Erik Mazzone, www.erikmazzone.com

Interesting article.

Regarding the concluding paragraph (organizations are attempting to increase

employee engagement by flattening hierarchies): I'm not sure this is a sensible
response to the problem.

If all of the studies agree that a key factor in engagement is the employee's
relationship with his/her direct line manager, doesn't flattening the hierarchy make
this more difficult? Flattening a hierarchy (removing layers of bureaucracy and
management) would seem to increase the number of direct reports each manager
has. Having more direct reports means a manager has less time for each
individual. Less time for each individual means less time to build a personal
relationship.

Doesn't this "fix" potentially go in the wrong direction?

No matter the definition of employee engagement, the payback to allowing

employees to develop a strong sense of ownership, a feeling that it is their
workplace, is huge. Stephen Covey wrote that the difference between essentially
poorly motivated and highly motivated employees is about 500% in productivity.

My own experience in four successful turnarounds verifies this difference and

indicates that it is within the grasp of every manager should they decide to act
appropriately. My definition of same is embodied in the ten question test below.

This is a simple test of 10 questions. Rank yourself (or a manager) on a scale of 1

to 10, 10 being the best or almost always, 1 being the worst or almost never. Add
up the points for each question.

If you score close to 100, I would expect that your employees will be over 3 times
more productive than if your score was 30 or less. In addition, employees will
unleash their full potential creativity and innovation, love to come to work and
have very high morale.

Table 3.1 Literature view on impact of engagement

Impact of Employee Engagement

Statement Source
"There are clear links between employee engagement and Briggs (2005), Australian
effectiveness, which, in turn, affect productivity. Employee Government Public Service
engagement goes to the heart of organisational capability Commissioner as cited in
issues" Meere (2005)
"….high levels of engagement have been found to be
associated with a whole range of beneficial outcomes, CIPD (2006c)
including high levels of performance"
"….there appears to be a general willingness to accept the
underpinning finding: the higher the level of employee
commitment, the better the business outcome. If employee Robinson et al (2004)
engagement is indeed one-step beyond commitment, the
reward should be even greater"
"….it takes little persuasion on a theoretical level to
convince a business leader that employees who are more
committed, work harder and smarter will be better for the Melcrum Publishing (2005)
company than those who turn up, do merely what they are
obliged to do and leave"
"Your organisation's success depends on people's true
engagement…..Research has shown that engaged employees Right Management (2006)
make for a stronger organisation and better business results"
"Employers want engaged employees because they deliver
CIPD (2007a)
improved business performance"

Table 3.2 Importance of Employee Engagement - case study evidence

Case Study Evidence Source

Public Sector
Runner up in CIPD People Management
Awards - Judges' assessment:

"The council made big improvements in employee

Rotherham turnover, satisfaction and absence levels following
Metropolitan an employee engagement initiative. Brockett (2006)
Borough Council Communication between the council officers, the
community, unions and council members was
outstanding. A good example of how to drive
through change quickly, in collaboration with
stakeholders."
"We are not a traditional authority. We seem to
have more ways to get messages out and actively
listen to people."
Cambridgeshire
Johnson (2006)
County Council
"If you don't start with the workforce, how can you
reach the public? 18,000 ambassadors are better
than 18,000 assassins."
Private Sector
BBC "….the BBC has moved very strongly and sincerely Melcrum
towards an engagement culture and is doing a lot Publishing
to encourage behaviour that might, elsewhere, fit (2005)
under this banner. But instead, we talk more about
words like 'involve', 'participate' and 'respond'
 rather than 'engage'. That means creating shared
meaning and understanding in such a way that our
people actively want to participate."
RBS is the world's fifth largest bank and it has the
concept of employee engagement at the heart of its
business strategy. Its model is based on engaging
staff to:
Robinson et al
Royal Bank of
(2004) -
Scotland • ' Say' that the job and company are good
Appendix 3
• ' Stay' with the company and develop it

• ' Strive' to go the extra mile for the

company
"People need to become engaged with the business
so that they become advocates of the business. This
means that by your employer brand you have to
employ the right people to begin with. Microsoft
does this well. Not everyone wants to work for
Microsoft, but those that are there love it".
McKenzie, A.
Microsoft "The people who get in have a communications
HR Gateway
vehicle, systems and processes that reflect what
they want in terms of the employer brand and what
it stands for. Of course, when you have the right
people you have the trouble of creating ways of
letting them know what is going on in the business
and where they fit in - in regard to business goals
and objectives".
"… it has a powerful people engagement strategy
IRS
that consistently demonstrates the link between
Employment
leadership, culture and business competitiveness.
West Bromwich Review
Most recently the society won the UK Business
Building Society
Excellence award for Employee Satisfaction, which
(24 March
recognises 'outstanding performance in the area of
2006)
staff development and involvement."
"At RBC we decided to reinvent our employee
Melcrum
communication so that it would not only inform
Royal Bank of Publishing
employees, but do a better job of engaging and
Canada
aligning their performance with our vision and
(Oct/Nov 2006)
business goals."
 3.1 RESEARCH METHODOLOGY

THE RESEARCH OBJECTIVES :-

i.) To study the impact of employee engagement on productivity of the

organization.
ii.) To study the various methods of employee engagement prevailing in the
organization.

1. ADOPTED RESEARCH METHODOLOGY AS FOLLOWS :-

RESEARCH PLAN:

Data source Primary & secondary data (questionnaire, different

form as reports, magazines, websites etc.)

Research approach Descriptive research

Research tools Likert’s (z – test), Chi test
Research Instrument Questionnaire
Analytical tools Pie chart
Sample size 30
Sample unit Employee
Sample area Chittorgarh
Questionnaire Structured
Sampling Procedure Judgment Sampling
Data Collection Method Survey
Type of Question Close & Open ended
 LIMITATION

 The research conduct was limited to Udaipur region only.

 Due to time constraints, more time could not be devoted to
individual respondent.
 Due to unwillingness of providing any information, the
respondents filled the questionnaire casually which might have
effected the conclusion.
 Marketing manager being busy with his job. He was not able to
spare enough time for our proper guidance.
 A busy schedule of dealers / retailers also makes the collection of
information a very difficult one.
 Full district was not covered as this is very tedious job to be done
in 7 – days. However almost all main areas of the district were
covered.
 The projections are purely based on verbal meetings and may be
influenced by unprecedented factors.
 Non – cooperative behavior of the respondent was a big problem
in this survey.

While studying the above fact should taken into consideration.

DATA ANALYSIS & INTERPRETATION:

1. Employee engagement helps you a lot to increase your knowledge, skill,

attitude & ability to perform the job.

3 1

10
4

12

Strongly Agree Agree Not decided

Disagree Strongly disagree

X F FX (X- X) (X-X)2 F(X-X)2

5 10 50 1.47 2.161 21.61
4 12 48 0.47 0.221 2.652
3 4 12 -0.53 0.281 1.124
2 1 2 -1.53 2.341 2.341
1 3 3 -2.53 6.40 19.2
15 30 106 11.40 46.93
 TABLE OPTION POINT’S RESP- P×R SURVEY STAN- STAN-
S GIVEN ODEN- MEAN DARD DARD
ON TS (∑P×R/∑R) DEVIA ERROR
LIKERT’S (R) -TION (s/n)2
SCALE (σs)
(P)
Strongly 5 10 50
Agree
Agree 4 12 48
Not 3 4 12
Decided
Strongly 2 1 2
Disagree
Disagree 1 3 3
Total 15 30 106 3.53 1.27 0.23

X = ∑FX / N σ2 = F(X-X )2
X = 106 / 30 ¯¯¯¯¯¯¯¯¯
N-1
X = 3.53 (Survey Mean)
σ2= 46.93 / 29 = 1.62
σ = 1.27 (Standard Deviation)
Hypothesis respondents think that there is no significance difference between employee
engagements with regards to productivity of organization.
Points have been allocated to the response using Likert’s scale as
Hence the Null Hypothesis (Ho) µ = 3
Alternative Hypothesis (Ha) µ ≠ 3
Which means that µ may be greater or lesser than 3.
The z value is 1.96 at 95% confidences level or 5% level of significance in table.
So, midpoint will be 1+5/2 =3.
Level of significance for which the formula is
 µ ± z Sx
First equation will be:- Second equation will be:-
µ + z Sx µ - z Sx
3 + 1.96 × 0.23 3 - 1.96 × 0.23
3 + 0.45 3 - 0.45
3.45 (That’s upper limits.) 2.55 (That’s lower limits)
We can say that µ > 3 is rejected.
Most respondents agree that employee engagement helps a lot to increase a
knowledge & skills to perform the job.
Percentage of satisfaction of employee engagement uses by the related
respondents. We can say that µ > 3 is rejected.

Lower limit = 2.55 µ=3 Upper limit = 3.45

2. You had proper discussion with your head of department on the topics of
training or the areas of production are decided after proper discussion with you.

2 1

10
5

12

Strongly Agree Agree Not decided

Disagree Strongly disagree

X F FX (X- X) (X-X)2 F(X-X)2

5 10 50 1.10 1.21 12.10
4 12 48 0.10 0.01 1.2
3 5 15 -0.90 0.81 4.05
2 1 2 -1.90 3.61 3.61
1 2 2 -2.90 8.41 16.82
15 30 117 14.05 37.78
 TABLE OPTION POINT’S RESP- P×R SURVEY STAN- STAN-
S GIVEN ODEN- MEAN DARD DARD
ON TS (∑P×R/∑R) DEVIA ERROR
LIKERT’S (R) -TION (s/n)2
SCALE (σs)
(P)
Strongly 5 10 50
Agree
Agree 4 12 48
Not 3 5 15
Decided
Strongly 2 1 2
Disagree
Disagree 1 2 2
Total 15 30 117 3.90 1.14 0.21

X = ∑FX / N σ2 = F(X-X )2
X = 117 / 30 ¯¯¯¯¯¯¯¯¯
N-1
X = 3.90 (Survey Mean)
σ2= 37.78 / 29 = 1.30
σ = 1.14 (Standard Deviation)
Hypothesis respondents think that there is no significance difference between employee
engagements with regards to productivity of organization.
Points have been allocated to the response using Likert’s scale as
Hence the Null Hypothesis (Ho) µ = 3
Alternative Hypothesis (Ha) µ ≠ 3
Which means that µ may be greater or lesser than 3.
The z value is 1.96 at 95% confidences level or 5% level of significance in table.
So, midpoint will be 1+5/2 =3.
Level of significance for which the formula is
 µ ± z Sx
First equation will be:- Second equation will be:-
µ + z Sx µ - z Sx
3 + 1.96 × 0.21 3 - 1.96 × 0.21
3 + 0.41 3 - 0.41
3.41 (That’s upper limits.) 2.59 (That’s lower limits)
We can say that µ > 3 is rejected.
Most respondents agree that proper discussion with head of department on the
topic of productivity.
Percentage of satisfaction uses by the related respondents. We can say that µ > 3 is
rejected.

Lower limit = 2.59 µ=3 Upper limit = 3.41

3. The objective of the production were clear to you.
1 1
2 14

12

Strongly Agree Agree Not decided

Disagree Strongly disagree

X F FX (X- X) (X-X)2 F(X-X)2

5 14 60 1.10 1.21 16.94
4 12 48 0.10 0.01 0.12
3 2 6 -0.90 0.81 1.62
2 1 2 -1.90 3.61 3.61
1 1 1 -2.90 8.41 8.41
15 30 117 14.05 41.20
 TABLE OPTION POINT’S RESP- P×R SURVEY STAN- STAN-
S GIVEN ODEN- MEAN DARD DARD
ON TS (∑P×R/∑R) DEVIA ERROR
LIKERT’S (R) -TION (s/n)2
SCALE (σs)
(P)
Strongly 5 14 60
Agree
Agree 4 12 48
Not 3 2 6
Decided
Strongly 2 1 2
Disagree
Disagree 1 1 1
Total 15 30 117 3.90 1.19 0.22

X = ∑FX / N σ2 = F(X-X )2
X = 117 / 30 ¯¯¯¯¯¯¯¯¯
N-1
X = 3.90 (Survey Mean)
σ2 = 41.20 / 29 = 1.42
σ = 1.19 (Standard Deviation)
Hypothesis respondents think that there is no significance difference between employee
engagements with regards to productivity of organization.
Points have been allocated to the response using Likert’s scale as
Hence the Null Hypothesis (Ho) µ = 3
Alternative Hypothesis (Ha) µ ≠ 3
Which means that µ may be greater or lesser than 3.
The z value is 1.96 at 95% confidences level or 5% level of significance in table.
So, midpoint will be 1+5/2 =3.
Level of significance for which the formula is
 µ ± z Sx
First equation will be:- Second equation will be:-
µ + z Sx µ - z Sx
3 + 1.96 × 0.22 3 - 1.96 × 0.22
3 + 0.43 3 - 0.43
3.43 (That’s upper limits.) 2.57 (That’s lower limits)
We can say that µ > 3 is rejected.
Most respondents agree that objective of production are clear for him.
Percentage of satisfaction of uses by the related respondents. We can say that µ > 3
is rejected.

Lower limit = 2.57 µ=3 Upper limit = 3.43

4. The senior is able to provide you knowledge about all the aspects, which you
want.
2
3 8

7
10

Strongly Agree Agree Not decided

Disagree Strongly disagree

X F FX (X- X) (X-X)2 F(X-X)2

5 8 40 1.43 2.04 16.32
4 10 40 0.43 0.18 1.80
3 7 21 -0.57 0.32 2.24
2 2 4 -1.57 2.46 4.92
1 3 3 -2.57 6.60 19.81
15 30 107 11.60 45.09
 TABLE OPTION POINT’S RESP- P×R SURVEY STAN- STAN-
S GIVEN ODEN- MEAN DARD DARD
ON TS (∑P×R/∑R) DEVIA ERROR
LIKERT’S (R) -TION (s/n)2
SCALE (σs)
(P)
Strongly 5 8 40
Agree
Agree 4 10 40
Not 3 7 21
Decided
Strongly 2 2 4
Disagree
Disagree 1 3 3
Total 15 30 107 3.57 1.24 0.23

X = ∑FX / N σ2 = F(X-X )2
X = 107 / 30 ¯¯¯¯¯¯¯¯¯
N-1
X = 3.57 (Survey Mean)
σ2 = 45.09 / 29 = 1.55
σ = 1.24 (Standard Deviation)
Hypothesis respondents think that there is no significance difference between employee
engagements with regards to productivity of organization.
Points have been allocated to the response using Likert’s scale as
Hence the Null Hypothesis (Ho) µ = 3
Alternative Hypothesis (Ha) µ ≠ 3
Which means that µ may be greater or lesser than 3.
The z value is 1.96 at 95% confidences level or 5% level of significance in table.
So, midpoint will be 1+5/2 =3.
Level of significance for which the formula is
 µ ± z Sx
First equation will be:- Second equation will be:-
µ + z Sx µ - z Sx
3 + 1.96 × 0.23 3 - 1.96 × 0.23
3 + 0.45 3 - 0.45
3.45 (That’s upper limits.) 2.55 (That’s lower limits)
We can say that µ > 3 is rejected.
Most respondents agree that senior is able to provide to knowledge & information.
Percentage of satisfaction of uses by the related respondents. We can say that µ > 3
is rejected.

Lower limit = 2.55 µ=3 Upper limit = 3.45

5. The methodology of production was excellent.

2 1
9

11

Strongly Agree Agree Not decided

Disagree Strongly disagree

X F FX (X- X) (X-X)2 F(X-X)2

5 9 45 1.20 1.44 12.96
4 11 44 0.20 0.04 0.44
3 7 21 -0.80 0.64 4.48
2 1 2 -1.80 3.24 3.24
1 2 2 -2.80 7.84 15.68
15 30 114 13.20 36.80
 TABLE OPTION POINT’S RESP- P×R SURVEY STAN- STAN-
S GIVEN ODEN- MEAN DARD DARD
ON TS (∑P×R/∑R) DEVIA ERROR
LIKERT’S (R) -TION (s/n)2
SCALE (σs)
(P)
Strongly 5 9 45
Agree
Agree 4 11 44
Not 3 7 21
Decided
Strongly 2 1 2
Disagree
Disagree 1 2 2
Total 15 30 114 3.80 1.13 0.21

X = ∑FX / N σ2 = F(X-X )2
X = 114 / 30 ¯¯¯¯¯¯¯¯¯
N-1
X = 3.80 (Survey Mean)
σ2 = 36.80 / 29 = 1.27
σ = 1.13 (Standard Deviation)
Hypothesis respondents think that there is no significance difference between employee
engagements with regards to productivity of organization.
Points have been allocated to the response using Likert’s scale as
Hence the Null Hypothesis (Ho) µ = 3
Alternative Hypothesis (Ha) µ ≠ 3
Which means that µ may be greater or lesser than 3.
The z value is 1.96 at 95% confidences level or 5% level of significance in table.
So, midpoint will be 1+5/2 =3.
Level of significance for which the formula is
 µ ± z Sx
First equation will be:- Second equation will be:-
µ + z Sx µ - z Sx
3 + 1.96 × 0.21 3 - 1.96 × 0.21
3 + 0.40 3 - 0.40
3.40 (That’s upper limits.) 2.60 (That’s lower limits)
We can say that µ > 3 is rejected.
Most respondents agree that methodology of production are excellent.
Percentage of satisfaction of uses by the related respondents. We can say that µ > 3
is rejected.

Lower limit = 2.60 µ=3 Upper limit = 3.40

6. There is open discussion between you & the HRD.

2 1 10
5

12

Strongly Agree Agree Not decided

Disagree Strongly disagree

X F FX (X- X) (X-X)2 F(X-X)2

5 10 50 1.10 1.21 12.1
4 12 48 0.10 0.01 0.12
3 5 15 -0.90 0.81 4.05
2 1 2 -1.90 3.61 3.61
1 2 2 -2.90 8.41 16.82
15 30 117 14.05 36.70
 TABLE OPTION POINT’S RESP- P×R SURVEY STAN- STAN-
S GIVEN ODEN- MEAN DARD DARD
ON TS (∑P×R/∑R) DEVIA ERROR
LIKERT’S (R) -TION (s/n)2
SCALE (σs)
(P)
Strongly 5 10 50
Agree
Agree 4 12 48
Not 3 5 15
Decided
Strongly 2 1 2
Disagree
Disagree 1 2 2
Total 15 30 117 3.90 1.13 0.21

X = ∑FX / N σ2 = F(X-X )2
X = 106 / 30 ¯¯¯¯¯¯¯¯¯
N-1
X = 3.90 (Survey Mean)
σ2 = 36.70 / 29 = 1.27
σ = 1.13 (Standard Deviation)
Hypothesis respondents think that there is no significance difference between employee
engagements with regards to productivity of organization.
Points have been allocated to the response using Likert’s scale as
Hence the Null Hypothesis (Ho) µ = 3
Alternative Hypothesis (Ha) µ ≠ 3
Which means that µ may be greater or lesser than 3.
The z value is 1.96 at 95% confidences level or 5% level of significance in table.
So, midpoint will be 1+5/2 =3.
Level of significance for which the formula is
 µ ± z Sx
First equation will be:- Second equation will be:-
µ + z Sx µ - z Sx
3 + 1.96 × 0.21 3 - 1.96 × 0.21
3 + 0.41 3 - 0.41
3.41 (That’s upper limits.) 2.59 (That’s lower limits)
We can say that µ > 3 is rejected.
Most respondents agree that open discussion with HRD. Percentage of satisfaction
of uses by the related respondents. We can say that µ > 3 is rejected.

Lower limit = 2.59 µ=3 Upper limit = 3.41

7. You had achieved your learning goals from the employee engagement.

1 1 10
3

15

Strongly Agree Agree Not decided

Disagree Strongly disagree

X F FX (X- X) (X-X)2 F(X-X)2

5 10 50 0.93 0.86 8.6
4 15 60 -0.07 0.00 0
3 3 9 -1.07 1.14 3.42
2 1 2 -2.07 4.28 4.28
1 1 1 -3.07 9.42 9.42
15 30 122 15.70 25.72
 TABLE OPTION POINT’S RESP- P×R SURVEY STAN- STAN-
S GIVEN ODEN- MEAN DARD DARD
ON TS (∑P×R/∑R) DEVIA ERROR
LIKERT’S (R) -TION (s/n)2
SCALE (σs)
(P)
Strongly 5 10 50
Agree
Agree 4 15 60
Not 3 3 9
Decided
Strongly 2 1 2
Disagree
Disagree 1 1 1
Total 15 30 122 4.07 0.94 0.17

X = ∑FX / N σ2 = F(X-X )2
X = 106 / 30 ¯¯¯¯¯¯¯¯¯
N-1
X = 4.07 (Survey Mean)
σ2 = 25.72 / 29 = 0.89
σ = 0.94 (Standard Deviation)
Hypothesis respondents think that there is no significance difference between employee
engagements with regards to productivity of organization.
Points have been allocated to the response using Likert’s scale as
Hence the Null Hypothesis (Ho) µ = 3
Alternative Hypothesis (Ha) µ ≠ 3
Which means that µ may be greater or lesser than 3.
The z value is 1.96 at 95% confidences level or 5% level of significance in table.
So, midpoint will be 1+5/2 =3.
Level of significance for which the formula is
 µ ± z Sx
First equation will be:- Second equation will be:-
µ + z Sx µ - z Sx
3 + 1.96 × 0.17 3 - 1.96 × 0.17
3 + 0.34 3 - 0.34
3.34 (That’s upper limits.) 2.66 (That’s lower limits)
We can say that µ > 3 is rejected.
Most respondents agree that achieved learning goal by the employee engagement.
Percentage of satisfaction of uses by the related respondents. We can say that µ > 3
is rejected.

Lower limit = 2.66 µ=3 Upper limit = 3.34

8. The HRD department seriously follow-up the suggestion provided by you for
the improvement of the production.
1 1
2 14

12

Strongly Agree Agree Not decided

Disagree Strongly disagree

X F FX (X- X) (X-X)2 F(X-X)2

5 14 60 1.43 2.04 28.56
4 12 48 0.43 0.18 2.16
3 2 6 -0.57 0.32 0.64
2 1 2 -1.57 2.46 2.46
1 1 1 -2.57 6.60 6.60
15 30 107 11.60 40.42
 TABLE OPTION POINT’S RESP- P×R SURVEY STAN- STAN-
S GIVEN ODEN- MEAN DARD DARD
ON TS (∑P×R/∑R) DEVIA ERROR
LIKERT’S (R) -TION (s/n)2
SCALE (σs)
(P)
Strongly 5 14 60
Agree
Agree 4 12 48
Not 3 2 6
Decided
Strongly 2 1 2
Disagree
Disagree 1 1 1
Total 15 30 107 3.57 1.18 0.22

X = ∑FX / N σ2 = F(X-X )2
X = 107 / 30 ¯¯¯¯¯¯¯¯¯
N-1
X = 3.57 (Survey Mean)
σ2 = 40.42 / 29 = 1.39
σ = 1.18 (Standard Deviation)
Hypothesis respondents think that there is no significance difference between employee
engagements with regards to productivity of organization.
Points have been allocated to the response using Likert’s scale as
Hence the Null Hypothesis (Ho) µ = 3
Alternative Hypothesis (Ha) µ ≠ 3
Which means that µ may be greater or lesser than 3.
The z value is 1.96 at 95% confidences level or 5% level of significance in table.
So, midpoint will be 1+5/2 =3.
Level of significance for which the formula is
 µ ± z Sx
First equation will be:- Second equation will be:-
µ + z Sx µ - z Sx
3 + 1.96 × 0.22 3 - 1.96 × 0.22
3 + 0.43 3 - 0.43
3.43 (That’s upper limits.) 2.57 (That’s lower limits)
We can say that µ > 3 is rejected.
Most respondents agree that HRD department seriously follow-up the suggestion
for the improvement of the production.
Percentage of satisfaction of uses by the related respondents. We can say that µ > 3
is rejected.

Lower limit = 2.57 µ=3 Upper limit = 3.43

9. Is the employee engagement supportive.

1 1 11
2

15

Strongly Agree Agree Not decided

Disagree Strongly disagree

X F FX (X- X) (X-X)2 F(X-X)2

5 11 55 0.87 0.76 8.36
4 15 60 -0.13 0.02 0.30
3 2 6 -1.13 1.28 2.56
2 1 2 -2.13 4.54 4.54
1 1 1 -3.13 9.80 9.80
15 30 124 16.40 25.56
 TABLE OPTION POINT’S RESP- P×R SURVEY STAN- STAN-
S GIVEN ODEN- MEAN DARD DARD
ON TS (∑P×R/∑R) DEVIA ERROR
LIKERT’S (R) -TION (s/n)2
SCALE (σs)
(P)
Strongly 5 11 55
Agree
Agree 4 15 60
Not 3 2 6
Decided
Strongly 2 1 2
Disagree
Disagree 1 1 1
Total 15 30 124 4.13 0.94 0.17

X = ∑FX / N σ2 = F(X-X )2
X = 106 / 30 ¯¯¯¯¯¯¯¯¯
N-1
X = 4.13 (Survey Mean)
σ2 = 25.56 / 29 = 0.88
σ = 0.94 (Standard Deviation)
Hypothesis respondents think that there is no significance difference between employee
engagements with regards to productivity of organization.
Points have been allocated to the response using Likert’s scale as
Hence the Null Hypothesis (Ho) µ = 3
Alternative Hypothesis (Ha) µ ≠ 3
Which means that µ may be greater or lesser than 3.
The z value is 1.96 at 95% confidences level or 5% level of significance in table.
So, midpoint will be 1+5/2 =3.
Level of significance for which the formula is
 µ ± z Sx
First equation will be:- Second equation will be:-
µ + z Sx µ - z Sx
3 + 1.96 × 0.17 3 - 1.96 × 0.17
3 + 0.34 3 - 0.34
3.34 (That’s upper limits.) 2.66 (That’s lower limits)
We can say that µ > 3 is rejected.
Most respondents agree that employee engagement supportive.
Percentage of satisfaction of uses by the related respondents. We can say that µ > 3
is rejected.

Lower limit = 2.66 µ=3 Upper limit = 3.34

10. If their any feedback system about the production from the production
department.

1 1 12
2

14

Strongly Agree Agree Not decided

Disagree Strongly disagree

X F FX (X- X) (X-X)2 F(X-X)2

5 12 60 0.83 0.69 8.28
4 14 56 -0.17 0.03 0.42
3 2 6 -1.17 1.37 2.74
2 1 2 -2.17 4.71 4.71
1 1 1 -3.17 10.05 10.05
15 30 125 16.85 26.20
 TABLE OPTION POINT’S RESP- P×R SURVEY STAN- STAN-
S GIVEN ODEN- MEAN DARD DARD
ON TS (∑P×R/∑R) DEVIA ERROR
LIKERT’S (R) -TION (s/n)2
SCALE (σs)
(P)
Strongly 5 12 60
Agree
Agree 4 14 56
Not 3 2 6
Decided
Strongly 2 1 2
Disagree
Disagree 1 1 1
Total 15 30 125 4.17 0.95 0.17

X = ∑FX / N σ2 = F(X-X )2
X = 106 / 30 ¯¯¯¯¯¯¯¯¯
N-1
X = 4.17 (Survey Mean)
σ2 = 26.20 / 29 = 0.90
σ = 0.95 (Standard Deviation)
Hypothesis respondents think that there is no significance difference between employee
engagements with regards to productivity of organization.
Points have been allocated to the response using Likert’s scale as
Hence the Null Hypothesis (Ho) µ = 3
Alternative Hypothesis (Ha) µ ≠ 3
Which means that µ may be greater or lesser than 3.
The z value is 1.96 at 95% confidences level or 5% level of significance in table.
So, midpoint will be 1+5/2 =3.
Level of significance for which the formula is
 µ ± z Sx
First equation will be:- Second equation will be:-
µ + z Sx µ - z Sx
3 + 1.96 × 0.17 3 - 1.96 × 0.17
3 + 0.34 3 - 0.34
3.34 (That’s upper limits.) 2.66 (That’s lower limits)
We can say that µ > 3 is rejected.

Most respondents agree that feedback system about the production from the
production department is available.

Percentage of satisfaction of uses by the related respondents. We can say that µ > 3
is rejected.

Lower limit = 2.66 µ=3 Upper limit = 3.34

11. What type of error may arise in your job, if you don’t involve in employee
engagement.

2 12
2
2

12

Confustion Delay

No Error Wastage

Spoilage of the product

X F FX (X- X) (X-X)2 F(X-X)2

5 12 60 1.0 1.0 12.0
4 12 48 0.0 0.0 0.0
3 2 6 -1.0 1.0 2.0
2 2 4 -2.0 4.0 8.0
1 2 2 -3.0 9.0 18.0
15 30 120 15.0 40.0
 TABLE OPTIONS POINT’S RESP- P×R SURVEY STAN- STAN-
GIVEN ODEN- MEAN DARD DARD
ON TS (∑P×R/∑R) DEVIA ERROR
LIKERT’ (R) -TION (s/n)2
S SCALE (σs)
(P)
Confusion 5 12 60

Delay 4 12 48
No Error 3 2 6

Spoilage of 2 2 4
the product
Wastage 1 2 2
Total 15 30 120 4.00 1.17 0.21

X = ∑FX / N σ2 = F(X-X )2
X = 106 / 30 ¯¯¯¯¯¯¯¯¯
N-1
X = 4.00 (Survey Mean)
σ2 = 40.0 / 29 = 1.38
σ = 1.17 (Standard Deviation)
Hypothesis respondents think that there is no significance difference between employee
engagements with regards to productivity of organization.
Points have been allocated to the response using Likert’s scale as
Hence the Null Hypothesis (Ho) µ = 3
Alternative Hypothesis (Ha) µ ≠ 3
Which means that µ may be greater or lesser than 3.
The z value is 1.96 at 95% confidences level or 5% level of significance in table.
So, midpoint will be 1+5/2 =3.
Level of significance for which the formula is
µ ± z Sx
First equation will be:- Second equation will be:-
µ + z Sx µ - z Sx
3 + 1.96 × 0.21 3 - 1.96 × 0.21
3 + 0.42 3 - 0.42
3.42 (That’s upper limits.) 2.58 (That’s lower limits)
We can say that µ > 3 is rejected.
Most respondents agree that error may arise without the employee engagement.
Percentage of satisfaction of uses by the related respondents. We can say that µ > 3
is rejected.

Lower limit = 2.58 µ=3 Upper limit = 3.42

12. What quality of production you are getting from J.K. cement.

1 1 10
7

11

Excellent Very good Neither good nor bad Bad Worse

X F FX (X- X) (X-X)2 F(X-X)2

5 10 50 1.07 1.14 11.4
4 11 44 0.07 0.00 0.00
3 7 21 -0.93 0.86 6.02
2 1 2 -1.93 3.72 3.72
1 1 1 -2.93 8.58 8.58
15 30 118 14.30 29.72
 TABLE OPTION POINT’S RESP- P×R SURVEY STAN- STAN-
S GIVEN ODEN- MEAN DARD DARD
ON TS (∑P×R/∑R) DEVIA ERROR
LIKERT’S (R) -TION (s/n)2
SCALE (σs)
(P)
Excellent 5 10 50

Very 4 11 44
Good
Neither 3 7 21
good nor
bad
Bad 2 1 2
Worse 1 1 1
Total 15 30 118 3.93 1.01 0.18

X = ∑FX / N σ2 = F(X-X )2
X = 106 / 30 ¯¯¯¯¯¯¯¯¯

N-1
X = 3.93 (Survey Mean)
σ2 = 29.72 / 29 = 1.02
σ = 1.01 (Standard Deviation)
Hypothesis respondents think that there is no significance difference between employee
engagements with regards to productivity of organization.
Points have been allocated to the response using Likert’s scale as
Hence the Null Hypothesis (Ho) µ = 3
Alternative Hypothesis (Ha) µ ≠ 3
Which means that µ may be greater or lesser than 3.
The z value is 1.96 at 95% confidences level or 5% level of significance in table.
So, midpoint will be 1+5/2 =3.
Level of significance for which the formula is
µ ± z Sx
First equation will be:- Second equation will be:-
µ + z Sx µ - z Sx
3 + 1.96 × 0.18 3 - 1.96 × 0.18
3 + 0.36 3 - 0.36
3.36 (That’s upper limits.) 2.64 (That’s lower limits)
We can say that µ > 3 is rejected.
Most respondents agree that quality of product are very good.
Percentage of satisfaction of uses by the related respondents. We can say that µ > 3
is rejected.

Lower limit = 2.64 µ=3 Upper limit = 3.36

FINDINGES AT A GLANCE

 Good brands image of J.K. cement in existing market.

 Low sales as compaired to market potential, which is around 27 % of

the total market.

 Birla , Binani and Bangur have maximum market share’s viz.

 Less advertisement of the product as compaired to other company.

 Lack of self – enthusiasm in working patterns of employees.

 Proper communication between employees and HRD and other parties.

 Many facility are available to employees from the side of compny on

time.

 There is a need of a proper information, encouragement & motivation

related to employee engagement.

 There is a complaint from the side of retailers is that dealers deal

customer directly and sell cement on lower price, due to this customer

does not go to retailers and purchase from dealers. thus the retailers

are not interested to keep stock of J.K. cement & impact on production

department.
SUGGESTIONS
 A company would be wise to measure employee satisfactions regularly the key to
employee retention is employee satisfaction.
 Company can increase the role of the employee by considering their suggestions
or complaints about service or product, so that necessary action can be taken.
 Review meetings should be often held so that the working pattern of the
employees can be checked and improved if needed.
 Employees need to be more self-enthusiastic and aggressive towards sales for
these appraisals should be gives to those employees who worked hard.
 Company representatives should reward employees and should make a long term
relationship with the employees so that they can push the product & productivity.
 Since customer are value maxi miser and their expectation to this brand is high, as
the brand image shows their complaints should be attended immediately to make
then remain brand royal.
 It should be checked that the non- trade consignment is not sold in the market, so
that is does not disturb the retail price of the market.
 Since transportation forms the major part of the cement cost, market potential of
the region should be properly accessed so that emphasis can be more on high
retention zone, which can be done by employing more authorized retailers.
 Top management should be convinced to pass the incentives to the employee so
that they are motivated to employee engagement & productivity.
 Company should increase the promotional and advertisement activities for giving
the popularity to the product.
 Company should set the policy on pricing. There should be certain time period for
increment and decrement in the pricing. Company should also give the prior
information for this to employee, dealers and retailers.
 There should be proper loading facility in the plant and out side the plant, delivery
of goods should be on time.
 Top management and employees should maintain proper communication with
dealers and retailers.
 Increase the number of dealers and retailers as this will help in making high sales
volume.
 Cash discount should be competitive and luring.
 Try to remove dealer’s monopoly.
BIBLOGRAPHY & REFERENCES:

BOOKS:

• Kotler Philip, ‘marketing management’ prentice Hall of India Pvt. Ltd. New
Delhi.
• Kothari C. R. ‘research methodology’, vishwa publication, New Delhi.
• Beri G.C. ‘marketing research’, Tata McGraw-hill publicating Co. Ltd. New
Delhi.
• Dr. Sharma D.D. ‘marketing research’, Sultan Chand & Sons educational
publication, New Delhi.
• Saxena Rajan ‘marketing management’ Tata McGraw-hill publicating Co. Ltd.
New Delhi.
• Verma H. V. ‘marketing of services’ Global business press, New Delhi.
• Business today magazine of August issue, 2008.

WEB RESOURCES:

http://www.jkcement.com
http://www.jkwhite.com
http://www.rediff.com
http://www.india_today.com
http://www.cmaindia.org
http://www.en.wikipedia.org
http://www.allbusiness.com

PUBLICATION:

Business Standard
The Hindu
ANNEXURE:- (Questionnaire)

Dear Sir/ Madam,

Please answer the following questions by checkmark again
box which you find most suitable for the statement given above it. This
questionnaire will help me in evaluating your training and development activities
prevailing at J.K. cement limited, Nimbahera, Chittorgarh.
Thank you for your contribution.
NAME:……………………………………………
AGE:……………………………………………...
SEX:……………………………………………….
EDUCATION:……………………………………
DESIGNATION:…………………………………
DEPARTMENT:…………………………………
PHONE NO:……………………………………..

Please tick mark against suitable box: -

1). Employee engagement helps you a lot to increase your knowledge, skill,
attitude & ability to perform the job.

Strongly agree. Agree. Not decided. Disagree. Strongly

2). You had proper discussion with your head of department on the topics of
training or the areas of production are decided after proper discussion with you.

Strongly agree. Agree. Not decided. Disagree. Strongly

3). The objective of the production were clear to you.

Strongly agree. Agree. Not decided. Disagree. Strongly

4). The senior is able to provide you knowledge about all the aspects, which you
want.

Strongly agree. Agree. Not decided. Disagree. Strongly

5). The methodology of production was excellent.

Strongly agree. Agree. Not decided. Disagree. Strongly

6). There is open discussion between you & the HRD.

Strongly agree. Agree. Not decided. Disagree. Strongly

7). You had achieved your learning goals from the employee engagement.

Strongly agree. Agree. Not decided. Disagree. Strongly

8). The HRD department seriously follow-up the suggestion provided by you for
the improvement of the production.

Strongly agree. Agree. Not decided. Disagree. Strongly

9). Is the employee engagement supportive.

Strongly agree. Agree. Not decided. Disagree. Strongly

10). If their any feedback system about the production from the production
department.

Strongly agree. Agree. Not decided. Disagree. Strongly

11). What type of error may arise in your job, if you don’t involve in employee
engagement.

Delay. Wastage. Confusion. Spoilage of product. No error

12). What quality of production you are getting from J.K. cement.

Excellent. Very good. Neither good nor bad. Bad. Worse

13). By, which sources you know about the J.K.cement center.

By Senior. By Newspaper. By good image. By relatives. Other

14). Your suggestions for the improvement of the production & employee
engagement.

………………………………………………………………………

………………………………………………………………………

………………………………………………………………………

Date: ___/___/_______
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