IMPLEMENTATION OF STRETCH Workshop for Executives of Industry Sector & International Operations Division From 30 th November OBJECTIVES OF THE WORKSHOP To re-enforce understanding of the concept & need for Stretch. To share the modified Stretch Tool & the proposed scheme for implementation. To gain hands-on experience in usage of Stretch Calculator. Scoring Patterns The Modified Stretch Tool & its application The Road Map: Implementation Methodology & Communication Process STRUCTURE OF THE PRESENTATION Scoring Patterns Some Statistics Performance Cycle 05-06 % Presentation on the modified Stretch Tool and the proposed scheme for implementation. Scoring Patterns The Modified Stretch Tool & its Application The Road Map: Implementation Methodology & Communication Process STRUCTURE OF THE PRESENTATION BACKGROUND Sr. Committee constituted in 2005 to review Stretch Tool. Two Task Forces appointed during KRA T/F workshop in April to: - To simplify Tool & suggest Implementation methodology - To improve Acceptability of Concept & Tool Teams of Unit MAP Champions recommendations given to above T/Fs Senior Committee on Stretch finalised recommendations of Task Forces on 6 th Sept.06 and modified Tool & scheme for implementation approved by MAP Steering Committee on 9 th Oct.06 for trial run. The existing Six Dimensions clubbed into Three factors. Simplified Tool will comprise only three dimensions.Tool Each dimension will be rated on a running scale of 1 to 10. Tool to be renamed : suggestions invited SALIENT FEATURES OF MODIFIED TOOL Rating of all three dimensions will be added & divided by 30 to get the Stretch Score for each KRA target. Stretch Score will range between 0.1 and 1.0. (Min. score 3 and max. score 30 out of 30) SALIENT FEATURES OF MODIFIED TOOL APPLICATION OF STRETCH Will be used for calculating final performance scores at BSC and Individual Plan level. Weighted Stretch score of each KRA will be averaged to get overall stretch score of the performance plan. (option to assign stretch for plan directly) This score will be factored in while calculating the Final Performance Score of the individual/BSC. SALIENT FEATURES OF MODIFIED TOOL Scoring Patterns The Modified Stretch Tool & its Application The Road Map for Implementation: Methodology & Communication Process STRUCTURE OF THE PRESENTATION Methodology Revised Scheme will be implemented on a trial basis across the company during current cycle (06-07) Stretch will be calculated for BSCs & Individual Plans For BSC level use of Stretch Tool is compulsory For Individual Plans use of Stretch Tool is optional STEPS Stretch of Company & Unit level BSCs will be assessed by Corporate level Committee using the Stretch Tool. While assigning Stretch, Committee will ensure that the average stretch of all Unit level BSCs does not exceed stretch of the Company level BSC. Stretch for BSCs of NC/Function Head, HOD and HOS will be assessed by unit level Committees using the Stretch Tool. While assigning Stretch, Committees will ensure that the average stretch of all BSCs under the respective NC/Function and Deptt. does not exceed stretch of the concerned NC/Function and Deptt. The Road Map for Implementation: Methodology & Communication Process The Section Head will assign Stretch to every individual plan using appropriate mechanism. Stretch Tool can be used as a guide off-line. While assigning Stretch, HOS to ensure that the average stretch of all individual plans does not exceed stretch of the Section BSC. Stretch will be assessed for the targets at L-5 for BSC and Individual Plans. A Stretch Calculator has been developed to facilitate the process. The Road Map for Implementation: Methodology & Communication Process STEPS .contd. COMPOSITION OF COMMITTEES The Road Map for Implementation: Methodology & Communication Process SNACTIVITYCOMMITTEE aCalculating stretch of company BSC and BSCs of all units Corporate level committee bCalculating stretch of NC level BSCs Unit level committee of GMs/ DROs cCalculating stretch of Deptt. & Section level BSCs within the unit Unit level committees of HODs with NC Head as Chairperson (multiple committees) dCalculating stretch of Individual Plans within Section Respective Section Heads Dept 3 Dept 4 Dept 2 Dept 1 L-1 BSC L-3 BSC L-4 BSC L-5 BSC L-6 Indl. Plans L-2 BSC NC BSC-1 (PG/Fn.) NC BSC-2NC BSC-5NC BSC-3NC BSC-4 Unit Committee (GMs/DROs) Exec 4 HOS Sectn 4 Unit Committees (HODs) Co. level BSC Unit BSC-1Unit BSC-2Unit BSC-3 Unit BSC-4 Corporate Committee CASCADING OF STRETCH Communication Sharing scheme with core MAP Champions from all units in a workshop (by 15 th Nov) Hosting the new scheme on the Intranet for wide communication across units (by 18 th Nov) MAP Champions to communicate scheme in the units through workshops (by 10 th Dec.) Core group to first hold w/shop for all MAP Champions of unit. MAP Champions to hold workshops to cover all executives of the unit. The Road Map for Implementation: Methodology & Communication Process SCHEDULE OF ACTIVITIES Following activities will be taken up immediately in parallel by concerned committees for completion as per dates mentioned: Corporate level Committee to assign stretch of the Company and Unit Scorecards (30 th Nov) Committees to assign stretch of the NC Scorecards (by 10 th Dec) Committees to assign stretch of the Dept. and Section Scorecards (by 12 th Dec) HoS to assign stretch for individual plans and share with individual executives (by 15 th Dec) (Unit committees/HOS will complete 1 st round of calculations which will be finalised once stretch of higher level is available) Thank You LINKAGE TO EXISTING DIMENSIONS & FACTORS INVOLVED DIMENSIONS OF MODIFIED TOOL LINKAGE TO EXISTING DIMENSIONS FACTORS IN PROPOSED DIMENSIONS 1. TARGET Relative to previous year(s) 2. COMPLEXITY of operation Dependence on uncontrollables external to BHEL Dependence on uncontrollables external to BHEL Complexity in coordination internal to BHEL Process related uncertainty Resource Constraints 3. EXCELLENCE required Skill requirements Need for innovation The Stretch Tool DIMENSION TARGETCOMPLEXITY of operation EXCELLENCE required STRETCH Running scale LOW 111 to HIGH 10 EXAMPLE OF STRETCH TOOL APPLICATION AT FINAL REVIEW STAGE Final Performance Score = Level Achieved X Weighted Average Stretch of achieved level Example STEP-1 : CALCULATION OF STRETCH OF PLAN FOR L-5 TARGETS Let there be 5 KRAs in the plan: KRA Wt. Stretch Wt. Str Total = 93 Aggregate Wt. stretch of Plan for L-5 targets= 93/ 100 = 0.93 This stretch can also be assigned by the Section head without doing the above calculation based on his judgement. STEP-2: ASSESSMENT OF ACHIEVEMENT LEVEL KRA Wt. Ach. Level Wtd. Ach Total = 410 Wtd. Achievement of Plan 410/ 100 = 4.1 STEP-3: CALCULATING STRETCH FOR ACHIEVEMENT LEVEL 4.1 = (0.93 / 5) X 4.1 = 0.76 STEP-4: CALCULATING FINAL PERFORMANCE SCORE = 4.1 X 0.76 = 3.116 STRETCH DIMENSION TARGETCOMPLEXITYEXCELLENC E STRETCH Running scale of 1-10 KRA Stretch Score of KRA= 21/30 = 0.7 EXAMPLE OF STRETCH TOOL APPLICATION Example 2 Targets : L-1 L-2 L-3 L-4 L Case 3: Stretch at L-5 (Target) : 0.9 Actual Achievement 95 i.e. L-4.5 Stretch for L-4.5 = 0.9 / 5 (X 4.5) = 0.81 Final Score = 4.5 X 0.81 = Case 4: Stretch at L-5 (Target) : 1.0 Actual Achievement 85 i.e. L-3.5 Stretch for L-3.5 = 1 / 5 (X 3.5) = 0.7 Final Score = 3.5 X 0.7 = 2.45 TARGET: Comparison of target for current year with BENCH MARK DEPENDENCE ON UNCONTROLLABLES: Uncertainty arising out of input availability from agencies outside BHEL which would impact achievement of target eg. Customers/Vendors/Govt/Collaborators etc. COMPLEXITY: Difficulty associated with planning, integrating & executing the job including coordination amongst various BHEL units / functions / internal resources & other variables. SKILL REQUIREMENT: Whether the existing skill sets would be sufficient to achieve the target or new skills sets would need to be developed. PROCESS RELATED UNCERTAINITY: Uncertainty about achieving target on account of the process adopted not being fully established/proven. NEED FOR INNOVATION: Need for evolving new processes/ methods/ tools/ technology etc for achieving the target. DESCRIPTION OF DIMENSIONS