PROMOTION POLICY OF WORKMEN AT IOCL, Western Region

Submitted By

Shweta Gopalji Pankhania

UNDER THE GUIDANCE OF

Ms. Smita Mukherjee

A PROJECT SUBMITTED IN PARTIAL FULFILMENT OF MMS TO

VIDYALANKAR INSTITUTE OF TECHNOLOGY Wadala (East), Mumbai 400 037 July 2013

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PROMOTION POLICY OF WORKMEN AT IOCL, Western Region

Submitted By

Shweta Gopalji Pankhania

UNDER THE GUIDANCE OF

Ms. Smita Mukherjee

A PROJECT SUBMITTED IN PARTIAL FULFILMENT OF MMS TO

VIDYALANKAR INSTITUTE OF TECHNOLOGY Wadala (East), Mumbai 400 037 July 2013

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DECLARATION

I the undersigned Ms.Shweta Gopalji Pankhania, MMS student of Vidyalankar Institute Of Technology, Wadala, Mumbai, do hereby declare that this project is authentic record of my work completed as a part of the curriculum of MMS & that all the information detailed here is true to the best of my knowledge.

(Ms.Shweta Gopalji Pankhania) Date: Mumbai

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ACKNOWLEDGEMENT
I would like to thank Ms. Milisha Verma for making my internship at Indian Oil Corporation Ltd, (Western Region), Worli a memorable experience. Under her guidance I was able to meet the heads of various departments who spared us their precious time and effort that we may understand the importance and role of human resource department.

This report has been prepared for the internship that has been done in the Indian Oil Corporation Ltd., Mumbai in order to study the practical aspect of the course and implementation of the theory in the real field with the purpose of fulfilling the requirements of the course of Master in management studies in Human Resources. The aim of this internship is to be familiar to the practical aspect and uses of theoretical knowledge and clarifying the career goals, so I have successfully completed the internship and compiled this report as the summary and the conclusion that have drawn from the internship experience. I would like to express my sincere gratitude to our internship coordinator who have given their valuable time and given me chance to learn something despite having their busy schedule, Ms. Milisha Verma for her great guidelines for internship. I am also thankful to Mr. Sanjay Parashar(Sr. Manager, HR) and other staff member for their co-operative support, and also presenting with an opportunity for me to have a practical experience in this organization and helped me to clutch the rear opportunities to learn the real world situation. I would also like to thank Sunita Mam and Govind Sir for their continuous support and guidance which was extremely helpful for me throughout the project. I am also grateful to all members of Indian Oil Corp Ltd. for providing several documents, papers, data, figures and services as well as sharing their experience with me.

Lastly I would like to thank my guide and professor Ms. Smita Mukherjee for her valuable inputs and assistance throughout my internship.

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INDEX Particulars
Executive Summary Objective, Scope, Assumption and Limitations of the Project An Overview to the Indian Oil Industry Company Overview Objectives and Obligations Group Of Companies Vision with Values Business Model of IOCL SWOT Analysis of IndianOil Literature Review Promotion and Program Procedure Bases of Promotion Promotion Policy Checklist Research Methodology and Data Analysis Parameters of Interview Promotion Procedure in IndianOil Analysis of the Interview(Statistics and Inferences) Conclusion Recommendations Bibliography

Page No.

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EXECUTIVE SUMMARY
IndianOil is the highest ranked Indian company in the latest Fortune Global 500 listings, ranked at the 83rd position. IndianOil's vision is driven by a group of dynamic leaders who have made it a name to reckon with.

The Human Resources department for the Western Region of IndianOil is located at Mumbai (Worli). Initially I was given the explanatory overview of the various HR departments. Where I got the opportunity to see the working of the HR departments like Industrial Relations, Recruitment, Promotion, General Administration, Performance Appraisal Review, Payroll, and Training & Development.

The report includes A Study of Promotion Policy at IOCL. The principle of research is to find whether the employees are satisfied with the procedures and effectiveness of the existing promotion policy. For this analysis employees (Blue collar and White collar employees) were selected and interviewed. Finally data was collected from them for analysis and recommendations.

It is observed that most of the employees do not know of the existing promotion policy whereas only some no. of employees is not satisfied with the existing promotion policy. It was seen that there was a lot of ambiguity regarding the existing promotion policy. 65% of the employees interviewed felt that there should be transparency in the Appraisal and Promotion procedures. Also since the Appraisal process is completely confidential the employees do not know about their performance it was a challenge to make recommendations on the clauses of the existing Promotion policy. As per the comments I got from the employees I rated their replies on a scale for analysis purpose.

The purpose of the promotion policy is to provide greater opportunities for Promotion and to improve the upward mobility potential for qualified as well as functional experience employees. Hence on the basis of this I tried to analyze the policy and came up with possible inferences and conclusions.

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Objective, Scope, Assumption and Limitations of the Project

OBJECTIVE Objective is to study & analyze the Promotion policy for Workmen at Indian Oil Corporation Ltd and suggest changes for the same.

SCOPE The Promotion Policies of Workmen at IndianOil are reviewed at regular intervals; hence a fresh perspective was needed to study the policies and procedures. There is scope to analyze the current Promotion policies and procedures and suggest changes which can be made for the benefit of the employees as well as the organization.

ASSUMPTIONS No assumptions have been made while making this project. All the data gathered is authentic & is collected from internet as well by taking interview of HR officials and other employees at IndianOil, Worli (Western Region office).

LIMITATIONS Since IndianOil is a government organization there was a restriction on accessibility of the information. All the data had to be used moderately as it is very critical to the organization it cannot be disclosed outside.

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An Overview to the Indian Oil Industry

Introduction The Indian Oil and Gas (O&G) sector is one of the six core industries of India and contributes over 15 per cent to the Gross Domestic Product (GDP). The country is the sixth largest consumer of oil in the world and the ninth largest crude oil importer. The sector is of immense importance to the economy owing to its significant forward integration with many other sectors. India is committed to boosting its growth in the years to come and this progress would translate into the countrys energy needs growing many times. The need of the hour, therefore, is to channelize all efforts on exploration of new blocks effectively as well as efficiently. The growing demand for crude oil and gas in the country coupled with policy initiatives of the Government of India towards increased E&P activity has given a great impetus to the growth of this sector.

Key Statistics

Oil continued to remain the top item in India's export basket during 2012-13. Crude oil as well as other petroleum products accounted for about one-fifth of India's outbound shipments, giving the much-needed boost to the countrys exports. Petroleum product exports rose 7.7 per cent at US$ 60.3 billion in 2012-13 from US$ 56.04 billion in 2011-12. Indian refiners processed 6.8 per cent more oil in April 2013 than a year earlier at 3.62 million barrels per day (mbpd), according to recent Government data, reflecting expanded capacity. Natural gas output stood at 3 billion cubic metres (BCM) in April 2013. Indias refining capacity was enhanced by 400, 000 bpd in 2012. Another 400, 000 bpd of capacity could be added in 2013 if Indian Oil Corporation's 300,000 bpd Paradip and Nagarjuna's 120,000 bpd Cuddalore refineries are completed by the end of this year.

Diesel & Petrol Crude oil production, as indicated by the core sector index, accounts for over 5 per cent of India's index of industrial production (IIP). Diesel consumption increased by 4.2 per cent year-on-year (y-o-y) in April 2013 to 6.2 million tonnes (MT), according to data compiled by the Petroleum Planning and Analysis Cell (PPAC) of the Ministry of Petroleum and Natural Gas. The growth in diesel consumption was faster than other petroleum products.
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The overall consumption of petroleum products increased 3.1 per cent y-o-y in April 2013, PPAC data indicated. Gas Natural Gas has emerged as one of the most preferred fuel owing to its environmentfriendly properties, greater efficiency and cost effectiveness. India's shale gas reserves are at about 290 trillion cubic feet (TCF), of which 63 TCF could be recovered, according to a study by US Energy International Agency. Shale gas is natural gas formed from being trapped within shale formations. Natural gas sector constitutes about 9.8 per cent of primary energy consumption which is projected to grow up to 20 per cent by 2025 as per Indian Hydrocarbon vision. About 65 per cent of natural gas consumption is accounted by power and fertiliser sectors. Petroleum and Natural Gas Regulatory Board chairman S. Krishnan emphasises on the need to develop a strategy to meet substantial share of energy needs from natural gas and take its contribution in the countrys energy basket from 9.8 per cent to 25 per cent in the medium term.

The demand for natural gas in India has been growing, and is expected to increase by 280 per cent from the current levels to 220 BCM by 2020.

Major Players of Indian Oil and Gas Industry

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Company Review

Indian Oil Corporation Limited, or IndianOil, is an Indian state-owned oil and gas corporation with its headquarters in New Delhi, India. The company is the world's 83rd largest public corporation, according to the Fortune Global 500 list, and the largest public corporation in India when ranked by revenue. IndianOil and its subsidiaries account for a 49% share in the petroleum products market, 31% share in refining capacity and 67% downstream sector pipelines capacity in India. The IndianOil Group of Companies owns and operates 10 of India's 22 refineries with a combined refining capacity of 65.7 million metric tonnes per year. The President of India owns 78.92% (1.9162 billion shares) in the company. In FY 2012 IOCL sold 75.66 million tonnes of petroleum products and reported a PBT of 37.54 billion, and the Government of India earned an excise duty of 232.53

billion and tax of

10.68 billion. It is one of the seven Maharatna status companies of

India, apart from Coal India Limited, NTPC Limited, Oil and Natural Gas Corporation, Steel Authority of India Limited, Bharat Heavy Electricals Limited and Gas Authority of India Limited Indian Oil operates the largest and the widest network of fuel stations in the country, numbering about 20,575 (16,350 regular ROs & 4,225 Kisan Seva Kendra). It has also started Auto LPG Dispensing Stations (ALDS). It supplies Indane cooking gas to over 66.8 million households through a network of 5,934 Indane distributors. In addition, IndianOil's Research and Development Centre (R&D) at Faridabad supports, develops and provides the necessary technology solutions to the operating divisions of the corporation and its customers within the country and abroad.

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Objectives & Obligations:

Objectives:

To serve the national interests in oil and related sectors in accordance and consistent with Government policies.

To ensure maintenance of continuous and smooth supplies of petroleum products by way of crude oil refining, transportation and marketing activities and to provide appropriate assistance to consumers to conserve and use petroleum products efficiently.

To enhance the country's self-sufficiency in crude oil refining and build expertise in laying of crude oil and petroleum product pipelines.

To further enhance marketing infrastructure and reseller network for providing assured service to customers throughout the country.

To create a strong research & development base in refinery processes, product formulations, pipeline transportation and alternative fuels with a view to minimizing/eliminating imports and to have next generation products.

To optimise utilisation of refining capacity and maximize distillate yield and gross refining margin.

To maximise utilisation of the existing facilities for improving efficiency and increasing productivity.

To minimise fuel consumption and hydrocarbon loss in refineries and stock loss in marketing operations to effect energy conservation.

To earn a reasonable rate of return on investment. To avail of all viable opportunities, both national and global, arising out of the Government of Indias policy of liberalisation and reforms.

To achieve higher growth through mergers, acquisitions, integration and diversification by harnessing new business opportunities in oil exploration & production, petrochemicals, natural gas and downstream opportunities overseas.

To inculcate strong core values among the employees and continuously update skill sets for full exploitation of the new business opportunities.

To develop operational synergies with subsidiaries and joint ventures.

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GROUP OF COMPANIES

Lanka IOC PLC

Indian Oil (Mauritius) Ltd.

IOC Middle East FZE

Chennai

Petroleum

Corporation

Limited (CPCL)

IndianOil - CREDA Biofuels Limited

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Vision with Values

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Values:
IndianOil nurtures the core values of Care, Innovation, Passion & Trust across the organization in order to deliver value to its stakeholders. Care Stands for

Concern Empathy Understanding Co-operation Empowerment

Innovation Stands for

Creativity Ability to learn Flexibility Change

Passion Stands for

Commitment Dedication Pride Inspiration Ownership Zeal & Zest

Trust Stands for

Delivered promises Reliability Dependability Integrity Truthfulness Transparency

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BUSINESS MODEL OF IOCL:

IOCL has its presence in all spheres of downstream operations.

PRODUCTS OFFERED BY IOC

Indian Oil is not only the largest commercial enterprise in the country it is the flagship corporate of the Indian Nation. Besides having a dominant market share, Indian Oil is widely recognized as Indias dominant energy brand and customers perceive Indian Oil as a reliable symbol for high quality products and services. Major Products of IOCL are:

Auto LPG Aviation Turbine Fuel Bitumen High Speed Diesel Industrial Fuels Liquefied Petroleum Gas

Lubricants & Greases Marine Fuels MS Gasoline Petrochemicals Crude Oil Superior Kerosene Oil

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Refining

Born from the vision of achieving self-reliance in oil refining and marketing for the nation, IndianOil has gathered a luminous legacy of more than 100 years of accumulated experiences in all areas of petroleum refining by taking into its fold, the Digboi Refinery commissioned in 1901.IndianOil controls 10 of Indias 22 refineries.

The group refining capacity is 65.7 million metric tonnes per annum (MMTPA) or 1.30 million barrels per day -the largest share among refining companies in India. It accounts for 31% share of national refining capacity.

The strength of IndianOil springs from its experience of operating the largest number of refineries in India and adapting to a variety of refining processes along the way. The basket of technologies, which are in operation in IndianOil refineries include: Atmospheric/Vacuum Distillation; Distillate FCC/Resid FCC; Hydrocracking; Catalytic Reforming, Hydrogen Generation; Delayed Coking; Lube Processing Units; Visbreaking; Merox Treatment; Hydro-Desulphirisation of Kerosene&Gasoil streams; Sulphur recovery; Dewaxing, Wax Hydro finishing; Coke Calcining, etc.

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Pipelines

Indian Oil Corporation Ltd. operates a network of 11,163 km long crude oil, petroleum product and gas pipelines with a capacity of 77.258 million metric tonnes per annum of oil and 10 million metric standard cubic meter per day of gas. Cross-country pipelines are globally recognised as the safest, cost-effective, energy-efficient and environment-friendly mode for transportation of crude oil and petroleum products.

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Marketing
Reaching out to a Billion Hearts

IndianOil has one of the largest petroleum marketing and distribution networks in Asia, with over 35,000 marketing touch points. Its ubiquitous petrol/diesel stations are located across different terrains and regions of the Indian sub-continent. From the icy heights of the Himalayas to the sun-soaked shores of Kerala, from Kutch on India's western tip to Kohima in the verdant North East, IndianOil is truly 'in every heart, in every part'. The countrywide marketing operations are coordinated by 16 State Offices and over 100 decentralised administrative offices.

IndianOil has been adjudged India's No. 1 brand by UK-based Brand Finance, an independent consultancy that deals with valuation of brands. It was also listed as India's 'Most Trusted Brand' in the 'Gasoline' category in a Readers' Digest - AC Nielsen survey. In addition, IndianOil topped The Hindu Businessline's "India's Most Valuable Brands" list. However, the value of IndianOil brand is not just limited to its commercial role as an energy provider but straddles the entire value chain of gamut of exploration & production, refining, transportation & marketing, petrochemicals & natural gas and downstream marketing operations abroad. IndianOil is a national brand owned by over a billion Indians & that is a priceless value.

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Research & Development Centre

In today's dynamic business environment, innovation through a sustained process of Research & Development (R&D) is the only cutting edge tool for organisations to thrive. With emphasis on development and speedy commercialisation of globally competitive products, processes and technologies, the focus has now shifted from R&D to RD&D (Research, Development & Deployment).

Standing in the company of six worldwide technology holders for Marine Oils, with the second global OEM (original equipment manufacturer) approval by Wartsila, Switzerland, IndianOil's SERVO Marine Oils are now technically qualified to cater to the lubrication requirements of more than 90% of the world's marine engine population. In the powergeneration segment, the newly developed SERVO Marine K-Series was approved by Yanmar Co. Ltd. of Japan for use in their engines operating on distillate fuels.

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Petrochemicals

India is amongst the fastest growing petrochemicals markets in the world. Taking this into consideration and to enhance its downstream integration, IndianOil is focusing on increasing its presence in the domestic petrochemicals sector besides the overseas markets through systematic expansion of customer base and innovative supply logistics.

Petrochemicals have been identified as a prime driver of future growth by IndianOil. The Corporation is envisaging an investment of Rs 30,000 crore in the petrochemicals business in the next few years. These projects will utilise product streams from the existing refineries of IndianOil, thereby achieving better exploitation of the hydrocarbon value chain.

A robust logistics model has been the key to IndianOil's success story and facilities have been put in place for seamless product dispatches to customers by rail, road and sea.

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E&P
Forays into E & P

In keeping with the dynamic business environment, Indian Oil's business development initiatives continue to be driven by the emerging opportunities and guided by its corporate vision of becoming a diversified, transnational, integrated energy company. Its business strategy focusses primarily on expansion across the hydrocarbon value chain, both within and outside the country, while simultaneously revisiting its strategic plans and undertaking mid-course corrections, wherever necessary.

To enhance upstream integration, IndianOil has been pursuing exploration & production activities both within and outside the country in collaboration with consortium partners.

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Natural Gas

Drawing on its vast experience and carefully nurtured skill sets, IndianOil has made successful forays in diverse areas such as Natural Gas, Petrochemicals, Exploration & Production, Renewable Energy, etc.

Over the years, Natural Gas has emerged as the 'fuel of choice' across the world. It is steadily replacing traditional fossil fuels due to its environment friendly characteristics which help in meeting the stipulated automobile emission norms. Natural Gas has significant cost advantages over fuels such as Naphtha and commercial LPG. Demand for Natural Gas in India is primarily driven by the fertiliser and power sectors, which account for almost two-third of the countrys gas consumption.

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SWOT Analysis of IndianOil

Strengths
India's largest commercial enterprise with a strong brand name Has around 50% petroleum products Operates 10 refineries in India Huge distribution network through retailing Accounts for a 47% share in the petroleum products market, 34.8% share in refining capacity and 67% downstream sector pipelines capacity in India Has over 35,000 employees Loyalty programs like XTRAPOWER Fleet Card Program is aimed at Large Fleet Operators

Weakness
Legal issues Employee management Bureaucracy Volatility in the crude market & subsidy burden

Opportunities
Increasing fuel/oil prices Increasing natural gas market More oil well discoveries Expand export market

Threats
Government regulations High Competition

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LITERATURE REVIEW
In simpler terms, promotion refers to upward movement in present job leading to greater responsibilities, higher status and better salary. Promotion may be temporary or permanent depending upon the organizational requirement. Promotion is the transfer of an employee to a job which pays more money or one that carries some preferred status. In the corporate sector employee promotions doesn't make much difference as that of in government sector. In the government the word promotion is the ultimate desire for an employee for the service rendered by him in the organisation and this is the only way for an employee career development in the government sector. Promotion is the ultimate motivating factor for any employee because moves employee forward in hierarchy of concern organisation added with additional responsibility, higher respect, honour, with increase in grade pay and allowances. In countries like India, employee promotions are withhold by employers if any enquiry is pending on concerned employee due to his disobedience of duties or misuse of his powers especially in government departments. Until clearance of enquiry pending before COMPETENT AUTHORITY on concerned employee promotion will not be given. It is the responsibility of employee on whom enquiries pending should prove his innocence before concerned competent authority. Every organization should formulate a sound policy regarding promotion of its employees. The company that has no recognized promotion policy is likely to have frustrated and restless employees as they have no opportunity for advancement. The main features of a good promotion policy are as follows:

1. It must provide for a uniform distribution of promotional opportunities throughout the company. It means the ration of internal promotions to external recruitment must be the same in all departments. Otherwise there will be discontent and frustration in the department where this ration is lower. Therefore, equal opportunities for promotion should be provided to all categories of jobs in all the departments. 2. It must tell employees the avenues of advancement available to them. Multiple chain promotion charts may be prepared for this purpose. In such a chart each position in linked to several other positions to which promotions can be made. The charts showing ladders or paths of advancement or promotion routes are called opportunity charts or fortune sheets. Dead end jobs should be labelled and the upward path should be well marked on the chart.

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3. The basis of promotion should be clearly specified. Due weight age should be given to seniority, merit and future potential of an employee. Clear cut norms and criteria should be laid down for judging length of service, merit and potential. The assessment and reporting system should be objective. 4. Appropriate authority should be entrusted with the responsibility of taking decision on promotion. The final authority to sanction a promotion should rest with the concerned line executive. The human resource department should only suggest the names along with their records. 5. Suitable training and development opportunities should be provided so that employees can prepare themselves for advancement. 6. Detailed records of service and performance should be maintained for all employees. 7. The policy should be fair and impartial. Arbitrariness, favouritism, etc. should be eliminated. 8. It should be consistent, i.e., it should be applied uniformly irrespective of the person concerned. 9. It should be correlated with career planning. Sudden spurt of promotions (bunching) and long period of no promotion (promotional drought) should be avoided. 10. A suitable system of follow-up, counselling and review should be established. All promotions should be on a trial basis and the progress of the promoted employee should be monitored to ensure that all is going on well. Counselling and guidance should be provided to the employees rejected for promotion. Alternatives like up gradation may be provided for deserving candidate.

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Purpose
A policy on promotion ensures employees are given fair and equal opportunities for career development. It also sets guidelines on department communication regarding staff moving from one department to another.

Scope
The company's promotion policy details the procedures on how employees can apply for vacant positions. It specifies the responsibilities of the hiring manager and the human resources department in the selection process. It may also refer to pertinent provisions in the collective bargaining agreement, if the employees are unionized.

Process
Employees who possess the required skills, abilities, training and education may apply for a posted vacancy. Organizations often require staff to go through the same recruitment process as external candidates. Where internal candidates are considered for promotion, the hiring manager also reviews seniority and job performance.

Types of Promotions
Different types of promotions are discussed below. a) Multiple Chain Promotion: It provides a systematic linkage of each position to several others. It provides multi-promotional opportunities through clearly defined avenues of approach to and exit from each position in the organization. b) Up or Out Promotion: In this case, an employee either earns a promotion or seeks employment elsewhere. Out promotion usually leads to termination of employee and joining some other organization in a better position.

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Promotion Program and Procedure

Every organization should make advance plans for promotion programme. A carefully planned promotion programme has four elements: a) formulation of promotion policy, b) identification of promotion channels, c) promotion appraisal, and d) centralized records. We shall discuss each element in detail. a) Formulation of Promotion Policy: Each organization needs to maintain a balance between the internal sources of personnel promotion and external sources by means of recruitment. Hence, promotion must be based on consistent, fair and clear cut policy. Following are the factors on the basis of which a policy can be formulated:

Encouragement of promotion within the organization instead of looking outside to fill vacancies in higher places. An understanding that ability as well as seniority will be taken into account in making promotions. Ability, efficiency, attitude, job performance, physical fitness, leadership, experience, and length of service are some of the factors considered in making promotions. Drawing up an organization chart to make clear to all the ladder of promotion. Where there is a job analysis and a planned wage policy, such chart is quite easy to prepare. Making the promotion system clear to all concerned who may initiate and handle cases of promotion. Though departmental heads may initiate promotion, the final approval must lie with the top management, after the personnel department has been asked to check from its knowledge whether any repercussion is likely to result from the proposed promotion. All promotions should be for a trial period to ascertain whether the promoted person is found capable of handling the job or not. Normally, during this trial period, he draws the pay of the higher post, but it should be clearly understood that if he does not make the grade he will be reverted to his former post and former pay scale.

b) Promotion Channels: Promotion channels should be identified and recorded on paper. This process is related with job analysis and career planning of an organization. c) Promotion Appraisals: The promotion of an employee is entirely dependent upon his/her performance appraisal outcome. d) Centralised Records: The education, experience, skills, abilities and evaluation of all employees should be recorded and maintained in a centralised manner by the department of the organization, because basing on these attributes, promotion is given to an employee.

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Bases of Promotion
Promotion is given on the basis of seniority or merit or a combination of both. Let us discuss each one as a basis of promotion. Seniority as a basis: It implies relative length of service in the same organization. The advantages of this are: relatively easy to measure, simple to understand and operate, reduces labour turnover and provides sense of satisfaction to senior employees. It has also certain disadvantages: beyond a certain age a person may not learn, performance and potential of an employee is not recognized, it kills ambition and zeal to improve performance. Merit as a basis: Merit implies the knowledge, skills and performance record of an employee. The advantages are: motivates competent employees to work hard, helps to maintain efficiency by recognizing talent and performance. It also suffers from certain disadvantages like: difficulty in judging merit, merit indicates past achievement, may not denote future potential and old employees feel insecure.

Seniority-cum-Merit as basis: As both seniority and merit as basis suffer from certain limitations, therefore, a sound promotion policy should be based on a combination of both seniority and merit. A proper balance between the two can be maintained by different ways: minimum length of service may be prescribed, relative weightage may be assigned to seniority and merit and employees with a minimum performance record and qualifications are treated eligible for promotion, seniority is used to choose from the eligible candidates.

DEMOTION
Demotion refers to the lowering down of the status, salary and responsibilities of an employee. Demotion is used as a disciplinary measure in an organization. The habitual patterns of behaviour such as violation of the rules and conduct, poor attendance record, insubordination where the individuals are demoted. Beach (1975) defines demotion as the assignment of an individual to a job of lower rank and pay usually involving lower level of difficulty and responsibility. Causes of Demotion Demotion may be caused by any of these factors:

Adverse business conditions: Employees may be demoted because of recession faced by company. Incompetency of the employee: It happens when an employee finds it difficult to meet the required standard. Technological changes: When employee is unable to adjust with any technological change made by the company. Disciplinary measure.

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Promotion Policy Checklist

Promoting current employees builds good morale among workers. Promotion-from-within policies are popular among organizations that bill themselves as "employers of choice." They essentially invest in their current workforce, develop succession plans and provide training and professional development opportunities to prepare staff for more responsible roles with the organization. Nevertheless, a promotionfrom-within policy must be structured so that there's fair competition for jobs among internal candidates and between internal and external candidates. Employee Handbook Employees who are interested in transferring to different departments or being considered for promotions should know the criteria necessary for being considered for employment opportunities. Publish your company's checklist in the employee handbook for employees' easy reference and to limit the questions that supervisors, managers and HR staff have to answer whenever the company advertises a job vacancy or posts an internal position. As with all employee guidelines, always update the promotion-from-within policy every time you revise the handbook. Tenure Many companies require that employees remain in one position for at least six months before transferring or being promoted. Other organizations require that employees spend one year in their current roles before transferring to another department or applying for a promotion. This ensures that the employee is familiar with organizational guidelines, procedures and rules before tackling a new role that will simply add to the challenges of learning the company's mission and philosophy. Checklist items for internal transfers and moves should include the length of time an employee must be in her current role before applying for another position. Performance Past performance often is an indicator of future success, so it's imperative that employees seeking advancement within the company demonstrate that they are capable of strong performance in their current positions before they receive consideration for a transfer or higher-level job. This item on the promotion policy checklist should probably be the most stringent of all criteria. Companies that promote employees based solely on the length of time they have worked for the organization, and not because they are exemplary employees, can suffer tremendous losses if they promote employees who are marginally effective and even less effective once assigned higher-level responsibilities. The promotion checklist should indicate that employees interested in transferring or being promoted exhibit strong performance over the past two years with the company.

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Qualifications Organizations generally post openings internally, which gives current employees an opportunity for upward mobility with the company. But that doesn't preclude the employer from advertising the job vacancy on Internet job boards and in trade association publications to get a wide range of qualified candidates. Just because an employee is a long-term employee doesn't mean that she's automatically qualified to fill another position. The criteria that recruiters and hiring managers use to evaluate candidates must be equally evaluated among current workers and new applications.

Credentials When an employee sets her sights on moving up the corporate ladder, her preparation might include training, college coursework and credentials. For example, a physician in the early stages of her career might look forward to becoming a healthcare practice leader if she becomes board-certified in her field. Likewise, staff accountants seeking an internal promotion can reasonably expect to be considered for a higher-level position once they become certified public accountants. Include measurements such as credentials, degrees and professional licensing as part of your promotion checklist.

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RESEARCH METHODOLOGY AND DATA ANALYSIS

Research Methodology used for this project is interview type since questionnaire method was not allowed for research. I have interviewed few employees and Hr officials managing promotions from the Maharashtra State Office of Indian Oil Corporation Ltd, Worli.

Interview form
1. Cluster: 2. Grade:

3. Experience: 4. Qualification:

5. Trainings attended: 6. How helpful and relevant the things were for their job responsibilities? 7. How was your experience with the promotion & appraisal procedure? 8. Do you feel the ratings should be disclosed to you for your pe4rsonal development?

9. Satisfaction with the current policy & procedures (should there be a discussion with you before giving the ratings)?

10. Why do white collar workmen do not opt for Grade A promotions & go for movement to grade VII?

Data collection is done by primary as well as secondary method. Interviews are conducted & data is gathered from sources like internet.

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Parameters for Interview of Blue Collar Workmen

1. 2. 3. 4. 5. 6. 7. Cluster, Grade of Workmen, Experience. Qualification. Trainings attended. Awareness about the promotion policy. Experience with the promotion policy. Satisfaction and possible changes as per them. Experience with trade tests.

Parameters for Interview of White Collar Workmen

1. 2. 3. 4. 5. 6. 7. Cluster, Grade of Workmen, Experience. Qualification. Trainings attended. How helpful are the trainings for their current job responsibilities. Awareness and experience about the promotion policy. Satisfaction and possible changes as per them. Why do white collar workmen do not opt for Grade A promotions and go for movement to Grade VII.

Inferences derived from the above parameters:1. 2. 3. 4. 5. 6. The satisfaction level of the employees with the promotion policies. Possible loop holes in the promotion policy, if any. How effective are the trainings. Grievances regarding the promotion policy. Experience with the promotion policy. Steps to be taken for overall benefit of the blue collar workmen.

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PROMOTION An advancement of an employee from one position to a higher position is called promotion. This results in higher job title and higher job responsibilities. In Indian Oil Corporation Ltd all promotion activities are handled by the Human Resources department at the Marketing division(Worli) till the rank of officers grade. The employees coming under Workmen in Indian Oil Corporation Ltd are segregated as Blue collar and White collar employees. These employees are further divided into various clusters. A particular cluster will comprise of different grades, and employees can be assigned to any grade existing within the cluster. The grades/designation of promotion for the employees are from Grade I to Grade VII. The activities in the promotion process include:

CATEGORIES OF PROMOTION, Merit Channel Promotion:Minimum 4 yr experience 50% vacancies filled with this channel Time Channel Promotion:After completion of 8 yr in the particular Grade. Remaining 50% filled with this channel

CRITERIA FOR PROMOTION:-

Criteria for within cluster promotions:1. 2. 3. 4. Minimum qualifying period of service in the Grade Seniority Marks Qualification Marks Confidentiality Report (Contains Appraisal Ratings of the employee)

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Criteria for Inter cluster promotions:1. 2. 3. 4. 5. Minimum qualifying period of service in the Grade Seniority Marks Qualification Marks Confidentiality Report (Contains Appraisal Ratings of the employee) Job test or Trade test marks

Criteria for Grade V to Grade VI promotions, 1. 2. 3. 4. 5. 6. Minimum qualifying period of service in the Grade Seniority Marks Qualification Marks Confidentiality Report (Contains Appraisal Ratings of the employee) The promotions are carried out without interviews Employee is given marks on the basis of his overall performance and ratings.

Criteria for Grade VI to Grade VII promotions, 1. Basic qualification criteria 2. The employee should have completed 10 yr of service in Gr VI and have a clean record. 3. There can be no revision from Gr VII to Gr VI 4. The employees who will be promoted to Gr VII will not be eligible to apply for Grade A officer post. 5. Also the employee should not have any unauthorised absence during the previous 3 yr of the service. These details can be derived from the SAP HR module and the genuine cases can be decided to be considered. 6. The promotion from Grade VI to Grade VII is rather a movement than a promotion. If the employee denies to opt for Grade A officer promotion then he is moved to Grade VII.

Criteria for Grade VI to Grade A Officer promotions, 1. The employee should have completed 4 yr service(merit based) 2. Other basic criteria. 3. The selection process is done based on the willingness of the workmen to work in the field location provided to them 4. The employees will be relieved from their present post and position irrespective of accepting the offer or not.
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5. The employees should beforehand decide whether they want to accept the position of Grade A officer or not 6. The employees are posted to a different location as per the requirement for Grade A officers.

CONSTITUTION OF PROMOTIONAL PANEL A promotion committee is set up which includes HRD/User Department representatives. Updated seniority list in the grades is prepared and list is drawn of the eligible candidates to be considered for the promotion as per the application forms received for the promotion.

PREPARATION OF REPORT Panel report is prepared with the names of recommended candidates along with an annexure that contains the marks scored of the recommended as well as the rejected candidates. The same is sent to the department head for approval. The trade test marks and the appraisal rating and marks given by the respective manager of the employees is considered apart from the basic qualification criteria marks.

ISSUE OF PROMOTION LETTER On the basis of the panel report approval, the concerned department sends the approval report to the HR department for implementation. Promotion letters are prepared by the Human resources department and sent to the employees.

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Analysis Of the Interviews

Statistics and Inferences

How helpful the trainings undertaken were for their relevant job responsibilities after promotion?

Ratings
60% 3(Excellent) 2(Above Average) 1(Average)

20%
20%

Inferences
The trainings were found to be quite relevant as per the opinion of the employees. Although some employees did comment that the trainings did not help them perform their jobs with improved efficiency. Some trainings attended were not helpful for them to enhance their personal skill set or on a technical level. The trainings attended and performance in the same is not a criteria for promotion, also the performance of these trainings are not analyzed to check whether the employee has developed on that parameter or not.

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How was your overall experience with the Promotion and Appraisal?

Ratings
20% 3(Excellent) 2(Above Average) 1(Average)

20%

60%

Inferences
It was observed that most of the employees were extremely happy with their experience of the promotion policy, when asked the reason it was seen that since there is no transparency with the appraisal and promotion policy the employees have got accustomed to the procedure which has been followed over the period of time. There is lack of awareness regarding the criteria and parameters of promotion among the blue collar workmen, among the white collar workmen also there was seen some ignorance towards the policy since they are nowhere involved in either the appraisal or the promotion procedure. The basic conclusion is since the employees do not have the knowledge about the promotion policy.

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Do you feel that the Appraisal ratings should be disclosed to you for your Personal Development?

Opinion
35%
65% Yes No

INFERENCES
The employees strongly feel that there is a need for transparency. By being transparent about the ratings and the policy the employees know about the areas and skills where they lack. It helps the employees in self development and self realizations of their shortcomings so that they can accordingly work on it. Also trainings can be suggested accordingly such that the employees have an aim towards improving on the skills needed for their job responsibility.

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Level of satisfaction with the current promotion and appraisal policy and procedures followed,

Opinion
4% 28% 48% 20% 2(Average) 4(Excellent) 3(V.Good)

INFERENCES

The employees said that since they are not aware about the policies and its clauses and the outcome there is no question of satisfaction. The employees of Grade VII and employees who were nearing retirement said that it does not make a difference to them. A section of employees did mention that for higher satisfaction a discussion should be made mandatory so that the employees get to keep their views and opinion in front of their reporting manager. Also having a Rewards and Recognition program will give the employees motivation to work towards the responsibilities they have in their respective jobs.

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CONCLUSION
IndianOil is the highest ranked Indian company in the latest Fortune Global 500 listings, ranked at the 83rd position. IndianOil's vision is driven by a group of dynamic leaders who have made it a name to reckon with.

One of its main objectives is to develop their capabilities and facilitate their advancement through appropriate training and career planning. To have fair dealings with recognised representatives of employees in pursuance of healthy industrial relations practices and sound personnel policies.

The success level of the organization is thus directly proportional to the effective handling of the integration of human resources.

The needs that clearly emerge are:-

1. Strong need to manage the human assets to realize the full benefit of the diverse employees. 2. Need to communicate the vision and business plans as early as possible to the employees for better efficiency. 5. A process of communicating a clear message quickly, and then continuously stay in contact, is essential. 6. Clarity - provided at the earliest and constantly addressed to satisfy queries from employees is a must manage situation. Companies must look at establishing suitable processes that could be set up to manage this as suited to their work environment. 7. A high priority must be given on managing employees with unique skills, and the ones who influence customers. 8. Commitment from all employees needs to be obtained, and this is possible by bringing into alignment current and future needs of employees with the objectives of the company. 9. Transparency is required when it comes to policies and communication made to all the employees for Appraisal and Promotion purpose. This helps in the employees being able to chalk out their future plans and also is useful for Employee Retention. 10. Awareness of the various clauses and information of the promotion policy help the employees to set personal goals for performance and deliver accordingly. It also helps the manager to judge the employees and rate them easily. 11. Discussion with the employee before giving appraisal ratings to him. The employees should be given a fair chance to present their accomplishments and achievements throughout the year. The satisfaction level of the employees increases since they know their efforts and contribution is taken into consideration before giving the rating.
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RECOMMENDATIONS
The promotion policy should be readily available to the employees so that they are aware about their future career growth in the organization. It should be uploaded on the intranet portal which is accessible to all the employees. Once the employees know their path in the organization they can work towards attaining their own personal goals in the organization. Todays employees are more career conscious than ever, they are demanding more in terms of personal growth and development. Hence it further helps in career planning and succession planning of the employees, also in retention of the employees.

There is a need to create awareness about the promotion and the appraisal policy among the Blue Collar workmen. The Blue collar workmen should be explained the entire policy and their queries and grievances should be addressed accordingly. An organized structured platform should be designed for grievances redressal on the intranet where employees can get answers to their doubts regarding the promotion policy. All the parameters and criteria should be well in advance conveyed to the workmen and accordingly goals to be achieved in the performance cycle should be set. Later on the workmen can be given rating keeping in consideration how well the goals have been achieved.

Since there is no involvement of the employees in either the promotion policy or the appraisal policy very less could be commented by the workmen on it. It has been pointed out by the employees that there is a need for transparency in the appraisal procedure. The employees wish to know how they have performed during the year and in which areas they need improvement to achieve a better rating. The employees can work towards developing themselves to evolve and expand their knowledge base. Provision should be made for the employees to jump Grade and be eligible for promotion on the basis of the education criteria; this will assist and motivate the employees to opt for higher education thus increasing the standard of the employees.

The trade tests should be analyzed and accordingly changes should be made in it to make sure it is updated as per the requirement of the job description and the

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competencies necessary for the job. The trade tests should be assessed on the basis of content validity and predictive validity. It has been seen that many Grade VI employees do not opt for Grade A promotion in spite of being eligible for it. The actual reason behind it is many workmen have had a lot of experience at the existing location and do not wish for posting at another location since they are going to retire soon, in case of female employees they have family and children to look after thats why they dont opt for Grade A promotions. Hence there the clause of postings should be made flexible so that more employees apply for Grade A rather than movement to Grade VII.

Since there is very less awareness about the promotion policy there are fewer employees opting for inter-cluster promotions. Hence, there should be a mandatory annual session explaining about the various clauses in the promotion policy and the grievances should be addressed during the session. This will simplify the promotion procedure and the validation process can be carried out with ease. There should be a Rewards and Recognition program to further motivate the employees in their respective job responsibilities. It also creates a sense of belonging towards the work and the organization, the employee strives hard to maintain the same. The training programs should be given as per the skill set of the employees so as to inculcate many more values and technical skills which will facilitate them in a better execution of their job responsibilities. There should be proper examination of the performance of the employee after training to know whether the purpose of training has been achieved or not.

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BIBLIOGRAPHY
Websites: http://www.ibef.org/industry/oil-gas-india.aspx www.citehr.com www.iocl.co.in www.hr.com www.hrindia.com

References: Memos and notices published in the organization by the company The company promotion policy booklet Memorandum Of Settlement

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