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The five-fold core values remain the cornerstone of a long-term relationship at KNP

From being a luxury product, paints today have become a mass product and in the bargain painted the balance sheets of industry giants with bright colours. Divided into two segments – decorative & industrial, the industry is witnessing a 15% yoy growth. For the uninitiated, the decorative segment accounts for a whopping 75% of the Rs.95 billion paint sector. However, today, it is the industrial segment that is causing cheer for the industry majors. With automotive paints accounting for close to half of the industrial paints business, the paints industry is riding piggy-back on the high growth in the automotive sector.

The undisputed bastion of the industrial paints segment – Kansai Nerolac Paints (KNP) has every reason to smile after witnessing a 16% yoy growth & earning revenues of Rs.14.84 billion for FY07. That’s not to say that it is lagging in the decorative segment. With 20% market share in the decorative market, the company stands at number two in this segment.

As the revenues keep on mounting, so does competition and pressure to perform well. The cornerstone of KNP’s success in the industrial segment is undoubtedly the wide spread distribution network that has helped in generating huge sales revenue. And all this calls for a very well managed talent pool and a dynamic workforce that can withstand the pressures of targets and deadlines. Speaking to 4Ps B&M, Srikant Dikhale, Vice President – Human Resource, KNP points out, “Talent management is very crucial for our company and we at Nerolac have a very intact system in place to manage our talent pool.” Every year there is a round table conference in which the senior management scrutinise the workforce and divides it into three categories – the current fit or solid citizen (people who are doing well at their current job), people with potential to go up one level and people with potential to go up more than one level. Based on this categorisation and coupled with past performance, the best people are picked up to form the ‘talent pool’ and are suitably rewarded for their outstanding performance. This instills a sense of pride among this talented workforce and inspires the rest to work hard to get picked upthe next time.

With such a vast talent pool, there always lies a risk of losing key personnel to the competitors. Adds Dikhale, “The biggest problem that HR faces today is retention… there are so many jobs today that people don’t think before they quit.” Attrition is one of the major challenges faced not just by the paint industry but the FMCG sector as a whole. The attrition rate in the industry is around 22%, however at the sales front it stands at an alarming 30%. This implies that retaining the sales force is another major challenge and that’s where the HR department at KNP shows its dynamism. KNP tries to capture the aspirations of its people at the time of induction itself. On the last day of induction, the new joinees are given two forms. One form captures their aspirations in life, while the second tries to track down the way these freshers want to be treated by their seniors. The final result is conveyed to the respective HODs and the reporting heads. This helps them understand the new employees better. On being quizzed how Nerolac has come up with such an innovative idea Dikhale proudly announces, “One youngster came up with the idea that instead of being reactive and doing exit analysis of why people leave the company, lets be proactive and capture their aspirations when they join us.” Such ideas are usually brought forward in the monthly meeting at BASIC (Big And Small Ideas Cell) – an innovative idea generating cell of the HR department. The entire HR team meets once a month & brainstorms to come up with innovative ideas. Such is the impact of these sessions that now every department at KNP hasformed these innovation cells.

For assessing its workforce, KNP has in place a very unique system. A competency framework is decided for every job and then employees are sent to special assessment centers of the company where they spend two days going through various exercises like role plays, group discussions, case studies, personality tests et al. They are then assessed on the pre-defined competency framework and if they have performed up to the mark and match the set framework, they are promoted. This ensures that an employee who is performing well at his current job is promoted to a level up only when he is ready for it. That means even the best salesman at Nerolac can’t become area sales manager, unless and until he has the right competencies to become a manager.

At KNP there is also an added emphasis on developing people internally. However, when it comes to training and development, Dikhale sounds a bit skeptical as he explains, “When it’s the question of training, one needs to be very clear about who is to be trained and in what areas.” KNP does not believe in the ‘push effect’ of training. This implies that the HR department never goes in for random training of the workforce. In fact the respective HODs approach HR whenever they feel the need for their people to be trained in certain areas. That way it becomes more relevant for the employees and for the company as well. So training at KNP is all about the right people, at the right time, for the right kind of training.

Another key aspect of keeping employees satisfied is by keeping them constantly motivated and what better way than to give them immediate recognition for some exceptional work done. To acknowledge and reward its employees for good work, KNP has in place awards like Kaizen awards, best performance award et al. However, it is the instant recognition through the ACE (Acknowledgement of Contribution by Employees) program that gives the employees that extra kick and keeps them truly motivated.

Right from the time of induction, KNP believes in nurturing a long-term relationship with its employees. A case in point being that out of the eight people in the top management, three had joined KNP as management trainees and have climbed up the ladder. This fosters a belief in the young talent pool that they too can rise high in the organisation. An employee once taken aboard is no longer merely an employee but a member of the extended KNP family and is oriented towards the five fold core values of the company – innovation, entrepreneurship, responsiveness, simplicity and team work.

4Ps B&M edit bureau: Pallavi Srivastava & Surbhi Chawla

For Complete IIPM Article, Click on IIPM Article

Source : IIPM Editorial, 2008

An IIPM and Professor Arindam Chaudhuri (Renowned Management Guru and Economist) Initiative

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