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INTRODUCTION OF LIFE INSURANCE CORPORATION OF INDIA.The Life Insurance Corporation of India (LIC) is the largest life insurancecompany in India and also the country's largest investor. It is fully owned by theGovernment of India. It also funds close to 24.6% of the Indian Government'sexpenses. It was founded in 1956.

Headquartered in Mumbai, which is considered the financial capital of India, theLife Insurance Corporation of India currently has 8 zonal Offices and 101divisional offices located in different parts of India, at least 2048 branches locatedin different cities and towns of India along with satellite Offices attached to aboutsome 50 Branches, and has a network of around one million and 200 thousandagents for soliciting life insurance business from the public.The corporation is an autonomous and has necessary to run on sound principles.The corporation has been carrying out the role assigned to it and justifyingconfidence of public by offering adequate security at reasonable cost,dependable service, economic management and favorable returns to the nationat large.

In the year 1956, LIC had 5 zonal offices, 33 divisional offices and 212 branch

offices, apart from its corporate office. Re-organization of LIC took place andlarge number of new branch offices was opened. As a result of re-organization,servicing functions were transferred to the branches, and branches madeaccounting units. It worked wonders with the performance of the corporation.It may be seen that from about 200 crores of new business in 1957 thecorporation crossed 1000 crores only in the year 1969-70, and it took another 10years for LIC to cross 2000 crore mark of new business. But with re-organizationhappening in the early eighties, by 1985-86 LIC had crossed 7000 crore sumassured on new policies.

Today LIC functions with 2048 fully computerized branch offices, 100 divisionaloffices, 7 zonal offices and the corporate office. LICs wide are network covers100 divisional offices and connects all the branches through a Metro AreaNetwork. LIC has tied up with some banks and service providers to offer on-linepremium collection facility in selected cities. LICs ECS and ATM premium payment facility is an addition to customer convenience. Apart from on-linekiosks and IVRS, Info Centres have been commissioned at Mumbai,

Ahmadabad, Bangalore, Chennai, Hyderabad, Kolkata, New Delhi, Pune andmany other cities. With a vision of providing easy access to its policy holders, LIChas launched SATELLITE SAMPARK OFFICES. The Satellite offices aresmaller, leaner and closer to the customer. The digitalized records of the satelliteoffices will facilitate anywhere servicing and many other conveniences in thefuture.LIC continues to be the dominant insurer even in the liberalized scenario ofIndian insurance and is moving fast on a new growth trajectory surpassing itsown past records; LIC of India traversed its long and illustrious journey and nowhas a vision to emerge as a world class customer centric organization.

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Objectives of LIC:

Spread life insurance widely and in particular to the rural areas and to the

socially and economically backward classes with a view to reaching all insurablepersons in the country and providing them adequate financial cover againstdeath at a reasonable cost, is the main objective of LIC. Some other objectives ofLIC are as follows:Maximize mobilization of peoples savings by making insurance linked savings adequately attractive.Bear in mind, in the investment of funds, the primary obligation to itspolicyholders, whose money it holds in trust, without losing sight of the interest ofthe community as a whole; the funds to be deployed to the best advantage of theinvestors as well as the community as a whole, keeping in view national prioritiesand obligations of attractive return.

Conduct business with utmost economy and with the full realization that themoneys belong to the policy holders.Act as trustees of the insured public in their individual and collective capacities.Meet the various life insurance needs of the community that would arise in thechanging social and economic environment.

HUMAN RESOURCE MANAGEMENTHuman Resource Planning in LICHuman resource (or personnel) management, in the sense of getting things donethrough people. It's an essential part of every manager's responsibilities, butmany organizations find it advantageous to establish a specialist division toprovide an expert service dedicated to ensuring that the human resource function

is performed efficiently."PEOPLE ARE OUR MOST VALUABLE ASSET" is what the Branch Managerof LIC said to us.

Functions of HRM by LICSteps in developing HRM planning in LIC:Step 1: Get the 'big picture 'Understand your business strategy. Highlight the key driving forces of your business. What are they? E.g. technology, distribution, competition, the markets. What are the implications of the driving forces for the people side of yourbusiness? What is the fundamental people contribution to bottom line businessperformance?

StepStep 2 : Develop a Mission Statement or Statement of IntentThat relates to the people side of the business.Do not be put off by negative reactions to the words or references to idealisticstatements - it is the actual process of thinking through the issues in a formal andexplicit manner that is important.

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What do your people contribute?Step 3: Conduct a SWOT analysis of the organizationFocus on the internal strengths and weaknesses of the people side of thebusiness. Consider the current skill and capability issues.

What impact will/ might they have on business performance? Consider skill shortages? The impact of new technology on staffing levels?From this analysis you then need to review the capability of your personneldepartment. Complete a SWOT analysis of the department - consider in detailthe department's current areas of operation, the service levels and competences

of your personnel staff.Step 4: Conduct a detailed human resources analysisConcentrate on the organization's COPS (culture, organization, people, and HRsystems) consider: Where you are now? Where do you want to be?

What gaps exists between the reality of where you are now and where you want to be?Exhaust your analysis of the four dimensions.

Step 5: Determine critical people issuesGo back to the business strategy and examine it against your SWOT and COPS

Analysis Identify the critical people issues namely those people issues that you mustaddress. Those which have a key impact on the delivery of your businessstrategy. Prioritize the critical people issues. What will happen if you fail to addressthem?Remember you are trying to identify where you should be focusing your efforts

and resources.

Step 6: Develop consequences and solutionsFor each critical issue highlight the options for managerial action generate,elaborate and create - don't go for the obvious. This is an important step asfrequently people jump for the known rather than challenge existing assumptionsabout the way things have been done in the past. Once you have worked throughthe process it should then be possible to translate the action plan into broadobjectives. These will need to be broken down into the specialist HR Systemsareas of: employee training and development management development organization development performance appraisal employee reward employee selection and recruitment manpower planning

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communicationDevelop your action plan around the critical issues. Set targets and dates for theaccomplishment of the key objectives.

Step 7: Implementation and evaluation of the action plansThe ultimate purpose of developing a human resource strategy is to ensure that

the objectives set are mutually supportive so that the reward and paymentsystems are integrated with employee training and career development plans.There is very little value or benefit in training people only to then frustrate themthrough a failure to provide ample career and development opportunities.

The functions of HRM followed by LIC are as follows:Function 1 : Manpower planningThe penalties for not being correctly staffed are costly. Understaffing loses the business economies of scale and specialization, orders,customers and profits. Overstaffing is wasteful and expensive, if sustained, and it is costly to eliminatebecause of modern legislation in respect of redundancy payments, consultation,

minimum periods of notice, etc. Very importantly, overstaffing reduces thecompetitive efficiency of the business.Planning staff levels requires that an assessment of present and future needs ofthe organization be compared with present resources and future predictedresources. Appropriate steps then be planned to bring demand and supply intobalance.

What future demands will be is only influenced in part by the forecast of thepersonnel manager, whose main task may well be to scrutinize and modify thecrude predictions of other managers. Future staffing needs will derive from: Sales and production forecasts

The effects of technological change on task needs. Variations in the efficiency, productivity, flexibility of labor as a result of training, work study, organizational change, new motivations, etc. Changes in employment practices (e.g. use of subcontractors or agency staffs,hiving-off tasks, buying in, substitution, etc.) Variations, which respond to new legislation, e.g. payroll taxes or their abolition, new health and safety requirements. Changes in Government policies (investment incentives, regional or trade grants, etc.).That, in turn, will involve the further planning of such recruitment, training,retraining, labor reductions (early retirement/redundancy) or changes in

workforce utilization as will bring supply and demand into equilibrium, not just asa oneoff but as a continuing workforce planning exercise the inputs to which willneed constant varying to reflect 'actual' as against predicted experience on thesupply side and changes in production actually achieved as against forecast onthe demand side.

Function 2: Recruitment and selection of employeesRecruitment of staff should be preceded by:

An analysis of the job to be done (i.e. an analytical study of the tasks to be

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performed to determine their essential factors) written into a job description sothat the selectors know what physical and mental characteristics applicants mustpossess, what qualities and attitudes are desirable and what characteristics are adecided disadvantage; In the case of replacement staff a critical questioning of the need to recruit at all

(replacement should rarely be an automatic process). Effectively, selection is 'buying' an employee hence bad buys can be veryexpensive. For that reason some firms (and some firms for particular jobs) useexternal expert consultants for recruitment and selection. Equally some small organizations exist to 'head hunt', i.e. to attract staff withhigh reputations from existing employers to the recruiting employer. However, the'cost' of poor selection is such that, even for the mundane day-to-day jobs, thosewho recruit and select should be well trained to judge the suitability of applicants.The main sources of recruitment are: Internal promotionand internal introductions (at times desirable for moralepurposes)

Careers officers (and careers masters at schools) University appointment boards Agencies for the unemployed Advertising (often via agents for specialist posts) or the use of otherlocal media(e.g. commercial radio)Interviewing can be carried out by individuals, by panels of interviewers or in theform of sequential interviews by different experts and can vary from a five minute'chat' to a process of several days. Ultimately personal skills in judgment areprobably the most important, but techniques to aid judgment include selectiontesting for: Aptitudes (particularly useful for school leavers). Attainments General intelligence.

Function 3: Employee motivationTo retain good staff and to encourage them to give of their best while at workrequires attention to the financial and psychological and even physiologicalrewards offered by the organization as a continuous exercise.Basic financial rewards and conditions of service (e.g. working hours per week)are determined externally (by national bargaining or government minimum wagelegislation) in many occupations but as much as 50 per cent of the gross pay ofmanual workers is often the result of local negotiations and details (e.g. whichparticular hours shall be worked) of conditions of service are often more

important than the basics. Hence there is scope for financial and othermotivations to be used at local levels.As staffing needs will vary with the productivity of the workforce (and theindustrial peace achieved) so good personnel policies are desirable. The lattercan depend upon other factors (like environment, welfare, employee benefits,etc.) but unless the wage packet is accepted as 'fair and just' there will be nomotivation.The former demand better-educated, mobile and multi-skilled employees much

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more likely to be influenced by things like job satisfaction, involvement,participation, etc. than the economically dependent employees of yesteryear.Hence human resource management acts as a source of information about and asource of inspiration for the application of the findings of behavioral science. Itmay be a matter of drawing the attention of senior managers to what is being

achieved elsewhere and the gradual education of middle managers to new pointsof view on job design, work organization and worker autonomy.

Function 4 : Employee evaluationAn organization needs constantly to take stock of its workforce and to assess itsperformance in existing jobs for three reasons: To improve organizational performance via improving the performance ofindividual contributors (should be an automatic process in the case of goodmanagers, but (about annually) two key questions should be posed:o What has been done to improve the performance of a person last year?o And what can be done to improve his or her performance in the year to come?

To identify potential, i.e. to recognize existing talent and to use that to fillvacancies higher in the organization or to transfer individuals into jobs wherebetter use can be made of their abilities or developing skills. To provide an equitable method of linking payment to performance where thereare no numerical criteria (often this salary performance review takes place aboutthree months later and is kept quite separate from 1. and 2. but is based on thesame assessment).On-the-spot managers and supervisors, not HR staffs, carry out evaluations. Thepersonnel role is usually that of: Advising top management of the principles andobjectives of an evaluationsystem and designing it for particular organizations and environments.

Developing systems appropriately in consultation with managers, supervisorsand staff representatives. Securing the involvement and cooperation ofappraisers and those to be appraised. Assistance in the setting of objective standards of evaluation / assessment, forexample:o Defining targets for achievement;o Explaining how to quantify and agree objectives;o Introducing self-assessment;o Eliminating complexity and duplication. Publicizing the purposes of the exercise and explaining to staff how the systemwill be used.

Organizing and establishing the necessary training of managers andsupervisors who will carry out the actual evaluations/ appraisals. Not only trainingin principles and procedures but also in the human relations skills necessary.(Lack of confidence in their own ability to handle situations of poor performanceis the main weakness of assessors.) Monitoring the scheme - ensuring it does not fall into disuse, following up ontraining/job exchange etc. recommendations, reminding managers of theirresponsibilities.

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Basically an evaluation / appraisal scheme is a formalization of what is done in amore casual manner anyway. Most managers approve merit payment and thattoo calls for evaluation. Made a standard routine task, it aids the development oftalent, warns the inefficient or uncaring and can be an effective form ofmotivation.

Function 5: 5: Industrial relationsGood industrial relations, while a recognizable and legitimate objective for anorganization, are difficult to define since a good system of industrial relationsinvolves complex relationships between:(a) Workers (and their informal and formal groups, i. e. trade union, organizationsand their representatives);(b) Employers (and their managers and formal organizations like trade andprofessional associations);(c) The government and legislation and government agencies l and 'independent'agencies like the Advisory Conciliation and Arbitration Service.Oversimplified, work is a matter of managers giving instructions and workers

following them - but (and even under slavery we recognize that different'managing' produces very different results) the variety of 'forms' which haveevolved to regulate the conduct of parties (i.e. laws, custom and practice,observances, agreements) makes the giving and receipt of instructions far fromsimple.

Function 6: Provision of employee servicesAttention to the mental and physical well-being of employees is normal in manyorganizations as a means of keeping good staff and attracting others.The forms this welfare can take are many and varied, from loans to the needy tocounseling in respect of personal problems.

Among the activities regarded as normal are:

Schemes for occupational sick pay, extended sick leave and access to the firm's medical adviser; Schemes for bereavement or other special leave; The rehabilitation of injured/unfit/ disabled employees and temporary orpermanent move to lighter work;

Provision of financial and other support for sports, social, hobbies, and activities of many kinds which are work related; Provision of canteens and other catering facilities; possiblyassistance with financial and other aid to employees in difficulty(supervision, maybe, of an employee managed benevolent fund or scheme);

Provision of information handbooks, Running of pre-retirement courses and similar fringe activities; Care for the welfare aspects of health and safety legislation and provision offirst-aid training.

Attention to the mental and physical well-being of employees is normal in manyorganizations as a means of keeping good staff and attracting others.The forms this welfare can take are many and varied, from loans to the needy tocounseling in respect of personal problems.

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Among the activities regarded as normal are: Schemes for occupational sick pay, extended sick leave and access to the firm's medical adviser; Schemes for bereavement or other special leave; The rehabilitation of injured/unfit/ disabled employees and temporary or

permanent move to lighter work; Provision of financial and other support for sports, social, hobbies, activities ofmany kinds which are work related; Provision of canteens and other catering facilities; Possibly assistance with financial and other aid to employees in difficulty(supervision, maybe, of an employee managed benevolent fund or scheme); Provision of information handbooks, Running of pre-retirement courses and similar fringe activities; Care for the welfare aspects of health and safety legislation and provision offirst-aid training.

Function 7: Employee education, training and development

In general, education is 'mind preparation' and is carried out remote from theactual work area, training is the systematic development of the attitude,knowledge, skill pattern required by a person to perform a given task or jobadequately and development is 'the growth of the individual in terms of ability,understanding and awareness'.Within an organization all three are necessary in order to: Developworkers to undertake higher-grade tasks; Provide the conventional training of new and young workers (e.g. asapprentices, clerks, etc.); Raise efficiency and standards of performance;

Meet legislative requirements (e.g. health and safety); Inform people (induction training, pre-retirement courses, etc.);From time to time meet special needs arising from technical, legislative, andknowledge need changes. Meeting these needs is achieved via the 'trainingloop'. (Schematic available in PDF version.)Designing training is far more than devising courses; it can include activities suchas: Learning from observation of trained workers; Receiving coaching from seniors; Discovery as the result of working party, project team membership orattendance at meetings; Job swaps within and without the organization; Undertaking planned reading, or follow from the use of selfteaching texts andvideo tapes; Learning via involvement in research, report writing and visiting other works ororganizations.So far as group training is concerned in addition to formal courses there are: Lectures and talks by senior or specialist managers; Discussion group (conference and meeting) activities;

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Briefing by senior staffs; Role-playing exercises and simulation of actual conditions; Video and computer teaching activities; Case studies (and discussion) tests, quizzes, panel 'games', group forums,observation exercises and inspection and reporting techniques.

Evaluation of the effectiveness of training is done to ensure that it is costeffective, to identify needs to modify or extend what is being provided.

RECRUITMENTRecruitment at LIC: recruitment at LIC is done on all India bases.Class 1 officersare assistant administrative officers.Class 2 officers are development officers.Class 3 officers are assistant officers.Class 4 officers are the sub staff usually Job rotation is practiced in LIC meansemployees have to work in different departments. This is usually done to importdifferent types of sails in their employees.Recruitment at LIC is done by central office at Mumbai. The recruitments process

for above mentioned officers at LIC begins with placing at advertisements inpopular national and regional newspapers across the country.Candidates applying for above mentioned posts should be between 21 and 28years at age. They should be graduate/post graduate degree with minimum 50 %marks candidates from certain background(SC,ST,OBC) are given somecommissions with regard to age and marks.Short listed candidates are asked to appear for an entrance examination. Theentrance examination has 2 papersone is objective type and other is an essaytype. The objective type paper test is intelligence, aptitude, mathematicalknowledge, logical reasoning, general awareness and awareness of political andcultural events.

After written test, candidates have to appear for interviews which are conductedby LIC officers across the country. Based on overall performance candidatesreselected.There are basically 3 types of employees in LIC. First are the ones working onpayroll basis? There are permanent employees of LIC and receive their monthlyincomes.Second are the ones who are on temporary basis basically working for a year or2 years approximately. They also receive their incomes on monthly basis.Third are the ones who are agents who are purely working on Commission basis.Their Commission is decided on the number of policy holders they track.Recruitment at LIC: recruitment at LIC is done on all India bases. Class 1 officers

are assistant administrative officers.Class 2 officers are development officers.Class 3 officers are assistant officers.Class 4 officers are the sub staff usually Job rotation is practiced in LIC meansemployees have to work in different departments. This is usually done to importdifferent types of sails in their employees.Recruitment at LIC is done by central office at Mumbai. The recruitments processfor above mentioned officers at LIC begins with placing at advertisements in

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popular national and regional newspapers across the country. Candidates applying forabove mentioned posts should be between 21 and 28years at age. They should be graduate/post graduate degree with minimum 50 %marks candidates from certain background(SC,ST,OBC) are given somecommissions with regard to age and marksentrance examination has 2 papersone is

objective type and other is an essaytype. The objective type paper test is intelligence, aptitude, mathematicalknowledge, logical reasoning, general awareness and awareness of political andcultural events.

After written test, candidates have to appear for interviews which are conductedby LIC officers across the country. Based on overall performance candidates areselected.The different motivating programs like competitions are use. These areparameters to value them at different targets.The performance apparatus for employees is usually once in 1 year. 6 monthsafter information.

For class 1 officers its on financial year basis.For other employees its every calendar year.For class 1 officers double appraisal system is used. It is named as DOPA.Usually there is very much transparency in the organization.There is mutual agreement, planning agreement between employees andemployees.

Recruitment of other employees of the organization.Applications are invited from eligible candidates for selection and appointment forthe desired profile in the various Offices of LIC of India. The selection andappointment is subject to the reservation of SC/ST/OBC as per rules. The totalnumber of vacancies including vacancies for the reserved category may increase

or decrease, depending upon the actual vacancies at the time of final selectionand availability of successful candidates after the interview.