sanjay negiproject

PROJECT REPORT ON

CREDENTIAL OF HUMAN RESOURCES IN MARKET RESEARCH

Master Of Business Administration (Marketing)

Submitted in partial fulfillment of the requirement for award of

Master Of Business Administration of Tilak Maharastra

University, Pune

Submitted By:

Sanjay Negi

PRN- 07208015029

Of

Institute Of Business Studies & Research, Lonavala

Tilak Maharastra University

Gultekdi, Pune 411037.

1

Tilak Maharastra University, Pune

[Deemed Under Section 3 of UGC Act1956 Vide Notification

No. F.9-19/85 – U3 dated 24th April 1937 By Government of India]

Vidyapeeth Bhawan , Gultekdi, Pune – 411037

CERTIFICATE

This is to certify that project with Is of bonafide work carried out by Mr / Ms student of Master of Business Administration semester 4th Specialization under Tilak Maharastra University, in the year 2009.

Head of the department ExaminerExaminer

internal External

Date:

2

Place: University Seal

ACKNOWLEDGEMENT

“The satisfaction Euphoria that accompanies the successful completion of any work would be

incomplete unless we mention the name of the person, who made it possible, who constant

guidance and encouragement served as a beckon of light and crowned our efforts with success.” I

consider it a privilege to express through the pages of this report, a few words of gratitude and

respect to those who guided and inspired in the completion of this project.”

I would like to express my thanks to Mr.Bejoy Suri(Director Avsarr Quest Pvt.Ltd.) and

Dr.M.L.Monga(Executive Director-IBSAR) who gave me the opportunity to work with a well

known organization, Avsarr Quest Pvt.Ltd. which is the one of the best training and placement

organization of delhi.

I am very much thankful to Ms. Gunjan Agarwal(Director-Avsarr Quest Pvt.Ltd.) who gave me

the various ideas and provided her guidance to me for the market mapping in insurance sector.

I would like to thanks Mr. Duljinder Brar(Senior Manager-Avsarr Quest Pvt.Ltd.) who helped

me a lot to complete my market mapping work throughout the internship. Without his help

completion of this work was very difficult for me.

I would like to express my thanks to Mrs.Rashmi Mahajan who was my project guide at college

and who gave me her valuable inputs throughout my project.

Sanjay Negi

3

MBA-Marketing(2008-2010)

INDEX

Chapter No. Chapter Page No.

1 Rationale of study

2. Objective Of the study

2.1 Title Of the Project

2.2 Objective of study

2.3 Scope of study

3 Profile of the company

4 Review of literature

5 Research Methodology

5.1 Research Design

5.2 Data collection

Methods/Sources

5.3 Sampling Plan

6 Data Analysis & interpretations

7 Findings

4

CHAPTER-1

RATIONALE FOR THE STUDY

5

RATIONALE FOR THE STUDY

Avsarr Quest Pvt. Ltd. Is a recruitment and training firm which provides the recruitment and

manpower training in different sectors. The company hires the candidate for different banking

and insurance sectors. The firm also recruits for the media sector. The company also provides the

training for the banking operation sector. As the company provides the recruitment in the

banking and Insurance sector, my area of research is in market mapping for the different

insurance sectors. The company provides the manpower for different insurance sectors like icici,

hdfc,kotak,bajaj etc. So it is very much essential for the firm to provide effective manpower to

the different insurance companies. For that it is very necessary to know all the requirement of the

different insurance companies like which kind of manpower they want, salary and incentive

structure, previous work experience, skills and abilities of the candidate, target oriented and

potential candidate. For that the company conducted a research for different insurance

companies. The research was conducted on the basis of market mapping for different insurance

companies, by that the company could provide the effective recruitment for the various insurance

companies.

The companies covered in the market mapping:-

ICICI Prudential

Kotak

Bajaj

Aviva

Birla

HDFC

6

Reliance

The area which are being covered in the market mapping:-

Delhi market statistics

Organization structure across insurance firms

Compensation and benefits across levels in insurance firms

Profiles of sales manager across levels in insurance firms

Analysis of performing sales manager

7

CHAPTER-2

OBJECTIVE OF THE STUDY

8

OBJECTIVE OF THE STUDY

As the project was concerned with the market mapping of the various insurance companies,

which are related with Delhi/NCR regions,the objective of this study are as follows:-

Total market capture by each of the insurance companies

To identify the different organizational structure across the different insurance firms

To identify the compensation and the benefits across levels in the different insurance firms

To know about the profiles of the sales manager across the different insurance firms

To identify the policy advisors across the different insurance firms that why they differ

from company to company

To identify the salary structure of the different insurance companies

Why one company is performing well and what are the drawbacks by which the other

company is not performing well

9

What are the different parameters by which the insurance companies are attracting the

customer

To analyze the various competitive strategies of the different insurance companies by

which they are performing well.

To analyze the customer satisfaction level

What are the various parameters by which this study can be helpful to human resources

To analyze the factors of market mapping for human resources

10

TITLE OF THE PROJECT

CREDENTIAL OF HUMAN

RESOURCES

IN MARKET RESEARCH

11

SCOPE OF THE PROJECT

The research which is being conducted for the different Insurance companies is based on market

mapping. The market mapping is done for Delhi/NCR area. The mapping is being done with the

help of different organizational structure of the companies, salary and compensation structure,

profiles of the sales manager, market statistics and analysis of performance of sales manager. By

this study the fact which came to know is that there was a major difference in these companies in

the market statistic level, compensation level, heirarchial level and profile level. So by measuring

all these parameters this study can be very much useful in the manpower recruitment for many

companies and as well the study can be useful in the improvement of all those insurance

companies which are not performing well in comparison of other insurance companies. As the

company provides the recruitment in the banking and Insurance sector, my area of research is in

market mapping for the different insurance sectors. The company provides the manpower for

different insurance sectors like icici, hdfc,kotak,bajaj etc. So it is very much essential for the firm

to provide effective manpower to the different insurance companies. For that it is very necessary

to know all the requirement of the different insurance companies like which kind of manpower

they want, salary and incentive structure, previous work experience, skills and abilities of the

candidate, target oriented and potential candidate. For that the company conducted a research for

different insurance companies. The research was conducted on the basis of market mapping for

different insurance companies, by that the company could provide the effective recruitment for

the various insurance companies.

12

CHAPTER-3

COMPANY PROFILE

13

COMPANY PROFILE

Avsarr Quest Pvt.Ltd. has been incorporated under the Companies Act, 1956 and the company is

limited.

The registered office of the company is situated in the national capital territory of Delhi.

It imparts vocational training in various sectors along with facilitating the recruitment. It also

provides the training in different sectors along with banking.

It provides consultancy in the related matters and the financial matters to various industrial

sectors,public,students and other interested persons in India and abroad.

Main objects of the company:-

The main objects of the company are as follows:-

To provide consultancy in the related matters and financial matters to various industrial sectors

To carry out and develop activities relating to research and publications covering various aspects

of economy and other economic spheres as well as the publishing of books, magazines, booklets,

materials related to professional and academic studies as well as industrial and commercial

education both within India and abroad.

To carry out activities relating to development, maintenance and servicing of computer education

and software, computer hardware and networks computer aided education, communication and

multimedia products and systems, internet service providers by way of opening direct work

centres or giving franchise or network to others for the same.

14

Other objects:-

Other objects of the company are as follows:-

To act as consulting engineering and management consultants and to prepare project reports and

plan layouts and provide technical advice, guidance supervision in the erection, installation,

commissioning of any project industrial or otherwise

To carry on business in securities and to deal in stock and shares.

To carry on the business of buying, selling, exporting, importing, manufacturing, constructing,

devising and preparing all kinds of advertising novelties, materials, aids, complementary gifts,

design and any other such media used for the purpose of audio-visual publicity and

advertisement.

15

CHAPTER-4

REVIEW OF LITERATURE

16

REVIEW OF LITERATURE

Avsarr Quest Pvt.Ltd. is mainly a training and placement firm which recruits the manpower for

the various insurance sectors as well as the banking sectors.

These are the different insurance companies for which the firm recruits the manpower:-

ICICI Prudential

Kotak

Bajaj

Aviva

Birla

HDFC

Reliance

The area which are being covered in the market mapping are as following:-






17

Conclusion of the study:- The research which is being conducted for the different

Insurance companies is based on market mapping. The market mapping is done for Delhi/NCR

area. The mapping is being done with the help of different organizational structure of the

companies, salary and compensation structure, profiles of the sales manager, market statistics

and analysis of performance of sales manager. By this study the fact which came to know is that

there was a major difference in these companies in the market statistic level, compensation level,

heirarchial level and profile level. So by measuring all these parameters this study can be very

much useful in the manpower recruitment for many companies and as well the study can be

useful in the improvement of all those insurance companies which are not performing well in

comparison of other insurance companies.

18

CHAPTER-5

RESEARCH METHODOLOGY

19

RESEARCH METHODOLOGY

It constitutes the blueprint for the collection, measurement and analysis of data.

Research Design aids the researcher in the allocation of limited resources by posing crucial

choices in methodology.

Research Design is the plan and structure of investigation so conceived as to obtain answer to

research questions. The plan is the overall scheme or program of research. It includes an outline

of what the investigator will do from writing hypothesis and their operational implications to the

final analysis of data.

Research design expresses both the structure of the research-problem- the framework,

organization, a configuration of the relationships among variables of a study – and the plan of

investigation used to obtain empirical evidence on those relationships.

It is an activity and time based plan.

A plan always based on the research questions.

A guide for selecting sources and types of information.

A framework for specifying the relationships among the study’s variables.

A procedural outline for every research activity.

20

RESEARCH DESIGN

Research design is mainly consists with four dimensions:-

1-Research objectives

2-Research problems

3-Causes of problems

4-Solution

The research was designed in this study through the market mapping of the insurance sectors.

The objective of the research is to enhance the performance of the insurance companies by the

analysis of various parameters and various factors.

The problem in the reserch is the complicated profile structure of the insurance companies and

the various company policies.

This problem can effects on the performance of the various insurance firms.The solution for this

problem can be taken with the help of the market mapping which can enhance the performance

of the firms.

21

DATA COLLECTION METHODS AND SOURCES OF DATA

Data refers to a collection of natural phenomena descriptors, including the results of experience,

observation or experiment, or a set of premises. This may consists of numbers, words or image,

particularly as measurements or observation of a set of variables.

Types of data:-

Primary Data

Secondary Data

Primary source is used to collect initial material during the research process. Primary data is the

data that the researcher collects himself using methods such as surveys, direct observations,

interviews, as well as logs( objective data sources). Primary data are reliable way to collect the

data because the researcher will know where it come from and how it was collected and analyzed

since he did it himself. Primary sources of information allow the learner to access original and

unedited information . a primary source requires the learner to interact with the source and

extract information.

Secondary sources are edited primary sources, second-hand version. They represent thinking of

someone else. Secondary data are data that were collected by persons or agencies for purposes

other than solving problem at hand. They are one of the cheapest and easiest means of access to

information. Hence, the first the a researcher should do is to search for secondary data available

on he topic. The amount of secondary data is overwhelming, and researchers have to locate and

utilize the data are relevant to their research. Secondary sources take the role of analyzing,

explaining, and combining the information from the primary source with additional information.

22

SAMPLING METHODS

The sampling methods which has been used in this project is based on these insurance

companies:-

ICICI Prudential

Kotak

Bajaj

Aviva

Birla

HDFC

Reliance

The sampling has been done with the help of the market mapping of the above insurance

companies. The areas which are being covered in the sampling method are as follows:-






23

CHAPTER-6

DATA ANALYSIS

AND

INTERPRETATION

24

Area being covered




Profile of sales manager across insurance firms


25

Delhi market statistics-snapshots

Table representing the snapshots of total premia collected per year

by the all the seven insurance companies:-

premia collected(Rs.Cr.)/year 3,130

Excluding LIC 1,220

Number of sales manager 6,070

Premia per sales manager(Rs.Lacs.) 51

Excluding LIC 22

Number of branches 275

Per branch productivity(Rs.Cr.) 11

Excluding LIC 6

Table representing the premia collected by the insurance companies per year

LIC Pru Birla Bajaj HDFC Reliance Aviva Kotak

1,900 380 170 120 90 70 65 40

All figures given are in crores

26

Delhi/NCR market size-total premia:-

The bar chart representing the premia size of each insurance company

Rs.

Cr. 380 170 120 90 70 65 40

The total market size:-Rs 3,130 cr/year

The private insurance market is highly consolidated with the top three player(out of seven)

accounting for~56% share of the market.

LIC is still the dominant player with 61% of the Delhi NCR market share

27

Delhi market statistics(performance analysis):-

The table representing the premia, no. of sales manager and premia per sales manager for all

seven insurance companies

Type 1 Type 2 Type 3

Firm Pru Birla Bajaj HDFC Reliance Aviva Kotak

Premia 380 170 120 90 70 65 40

No. of sales

manager

1200 350 800 800 750 400 300

Premia per

manager(Rs

Lacs)

32 49 15 11 9 30 13

The big difference between the ‘type 1’ and ‘type 2’ is not account of ‘number of managers’ in

the market but because of significantly higher sales manager productivity i.e. ‘Premia per

manager’.

The sales manager productivity for market leaders is 2 times that of the type 3.

28

Delhi market statistics(performance analysis):-

Table representing the maximum profit earning branch, no. of premia collected from the branch

and the second maximum profit earning branch of Delhi

Firm Pru Birla LIC Bajaj HDFC Reliance Aviva

No. 1

Branch

Connaught

place

Connaught

place

Connaught

place

Connaught

place

Bikaji

kama

Connaught

place

Gurgaon

Premia 90 cr 55 cr 100 cr 30 cr 17 cr 20 cr 25 cr

No. 2

branch

Peetampura Gurgaon Connaught

place

Lajpat

nagar

Gurgaon Janakpuri Noida

For most of the firms, the top branch is usually located in Connaught place

Gurgaon would rank second as the most productive location in terms of premia collection

29

Branch level organization structure:-

There are two types of organization structure across insurance firms at branch level

Type 1 Type 2

↑ ↑ ↑

←

↑

↑

Type 1 represents the organization structure for Birla,Bajaj and Kotak insurance

Type 2 represents the organization structure for Pru ICICI,Reliance,Aviva and HDFC

30

Branch HeadBranch Head Branch Head

Assistant Branch Head

Unit ManagerUnit ManagerAssistant Branch Head

Unit Manager

Unit Manager

Branch level organization structure-span of control

The table representing the two type of span of control:-

Type 1

Span of control:

BM:AB

M

ABM:UM Productivity of UM

Kotak 1:4 1:10 13

Birla 1:1 1:20 49

LIC 1:1 1:10 317

Type 2

Span of control:

BM:ABM ABM:UM Product

ivity of

UM

Pru 1:4 1:10 32

Reliance 1:4 1:10 9

Aviva 1:2 1:10 30

HDFC 1:2 1:6 11

Each of the type is containg the ratio of BM(Business Manager) and ABM(Assistant

Business Manager), ABM(Assistant Business Manager) and UM(Unit Manager) and

productivity of unit manager

31

BM:ABM means business manager suboardinating the assistant business manager.Like

that ABM:UM means assistant business manager suboardinating unit manager.

Area level organization structure-span of control

Table representing delhi head, regional head,assistant regional head and the branch head

of all the seven insurance companies:-

Firm Pru Birla LIC Bajaj HDFC Reliance Aviva

Delhi

Head

2 1 1 1 2 1 1

Regional

Head

5 4 3 3 8 4 3

Assistant

Region

Head

13 11 18 15 16 18 12

Branch

Head

39 20 65 32 50 37 24

Regional manager span of control:

1. High variation of span of control across firms

2. Within firms there is high variation depending on area manager vintage & size of branch

3. HDFC is having the maximum number of branch head in Delhi

4. Birla is having the minimum number of branch head

32

Birla-Organization structure

Span of control

1. Delhi NCR did business of~ 170 cr in Dec end.

2.There is no delhi head but a zonal head.

↑

↑

↑

↑

33

Zonal

Head

Branch

Head

Branch

Manager

(19)

BDM

Agency Manager

Pru ICICI- Organization structure

1. Delhi NCR did business of 300 crs for Dec 08

2. There are currently 39 branches in Delhi NCR

3. A branch is headed by S.M. or by an area mgr.

↑

↑

↑

↑

↑

↑

34

Zonal Manager

(1)

Regional Manager(3)

Associate Regional

Manager(2)

Branch Manager

(6)

Area Manager(12)

Sales Manager

(34)

Unit manager

(950)

HDFC Standard Life Insurance-Organization structure

Span Of Control

1.Delhi did business of ~90 cr

↑

2.There are around 800

Sales manager in all.

3.There are about 20

Location in delhi

↑ NCR with only 3

Location doing more

than 50 lac per month.

↑

35

Regional Manager

Territory manager

(8)

Branch Sales Manager

(50)

Area sales manager/Business Development Manager/Sales Development Manager

Aviva-Organization structure

Span of control

1.Delhi NCR did business of ~ 65 cr

in Dec end.

2.There is currently one head for

1:8 Delhi& NCR

↑ 3.There are currently 8 branches

in Delhi & NCR

4.A typical branch would have~20

Sales manager.

↑

↑

36

Zonal Head

(1)

Branch Manager

(8)

Deputy Branch Manager

(13)

Associate Sales Manager,Sales Manager

(220)

Reliance-Organization structure

Span of control

1.Delhi NCR did Rs. Cr in

Dec end.

2.There are currently 20

↑ Branches in Delhi NCR

3.A branch manager has both

sales manager and ABM

Reporting to him

↑

↑

37

Regional Manager

(1)

Area Manager

(4)

Branch Manager

SSM/SM

(700)

Salary and incentive structure-sales manager

Table representing highest,average,starting ctc,1st year target and different designations of

all the seven insurance companies

Firm Aviva Bajaj HDFC Birla Pru Rel

Highest

CTC

4.5 2.75 3.25 3.04 3.25 3.5

Starting

CTC

2.25 1.8 2.25 2.54 2.5 2.5

Average

CTC

3.75 2 3 2.75 2.75 2.75

1st year

Target

40 36 36 3 lacs of

advisor

income

36 36

Different

designations

Ass SM,

SM

SM,

SSM

SDM,

BDM,

Area SM

Agency

Mngr,

BDM

UM,

Agency

Mngr

SM,

SSM

Sales Manager salaries vary from Rs.1.8 lacs to 5 lacs

First year target varies from 36 lacs to 75 lacs for first year Manager.Targets increase for

higher vintage people

38

Salary and incentive structure-sales manager

There are three types of incentive structure across insurance firms

Type 1 Type 2 Type 3

There are three types of incentive structure prevalent across firms

Within each type there is a variation i.e. % of premia could be based on incremental basis

Although some conveyance allowance is paid under type 1 & 2, it is not as significant as

in type 3

39

1.Fixed CTC

2.% of premia earned

by advisors

1. Fixed CTC

2. % of income by

Advisors

1.Fixed CTC

2.% of income by advisors

3.Incentive based on

advisors recruited,number of

cases,etc.

Sales manager incentive structure-structure details

Type 1

Table representing all the incentives of sales manager of LIC,Bajaj,Kotak and HDFC

Firm LIC Baja

j

Kotak HDFC

% of premia earned by advisors 0.5-5% 3% 2%-4.75% 1%-6% on incremental basis

Other incentives 2,500

Conveyance

Type 2

Table representing the % of income earned by advisors of aviva and birla

Firm Aviva Birla

% of income earned by

advisors

5%-25% 15%-35%

40

Type 3

Table representing all the incentives of sales manager of pru ICICI and Reliance

Firm Pru ICICI Reliance

% of premia earned by advisor 2%-4% 0%-4%

Other incentive-number of policies 4,000-

20,000

<10,000

ther incentives- 4,000-

20,000

<15,000

The bar graph represents the comparison of Rs.20,00,00 collected in premia

Rs.`000 120 106 102 100 97.5 94 67 60

Birla has the most

attractive structure

41

for firms

At higher level of premia, Birla still has the most attractive incentive structure for Sales

Manager

However there is a significant change in ranking of firms at higher premia level

Sales manager incentive structure- comparison across insurance

firms

The relative attractiveness of different incentive structure changes with slab rates

Summary of rankings:

Comparison for Rs. 5,00,00 collected in premia

Rank Firm

1 Birla

2 Pru

3 Kotak

4 Reliance

5 Aviva

6 HDFC

7 Bajaj

8 LIC

42

Comparison for Rs. 20,00,00 collected in premia

Rank Firm

1 Birla

2 HDFC

3 Reliance

4 Aviva

5 Kotak

6 Pru

7 LIC

8 Bajaj

Salary and incentive structure-ABM/BM and higher level

Typically at the ABM and higher level,incentive structure become complex

Each manager has to perform on a set of KRAs

43

KRAs have individual weights

The weights are then tied to a scale

Rating on the scale determines incentives which are either linked to CTC/Basic or to

premia earned by them

ABM and BM incentive structure- comparison across insurance

firms

To compare the incentive structure for ABMs/BMs we use the following thumb rule:

1. What is important is not the theoretical incentive which an ABM/BM can make

but the actual incentive they could have made given last year firms performance

2. The higher the number of parameters to be achieved the tougher is to achieve the

incentive

3. The weight attached to `receive premia’ parameter is important. The higher the

weight the easier it would be to make more incentives

4. We are using a metric “Number of parameters/Weight of received premia” to

judge how complex/ or less lucrative an incentive structure is

44

ABM and BM incentive structure- comparison across insurance

firms

The table representing the typical branch manager target sheet across firms

Firm Aviva HDFC Pru

Number of SMs 35 30 60

Target of SM

(Rs.lacs)

45 36 36

Average SM

productivity last

year

30 11 32

Weight of premia 70% 100% 40%

Total no. of

parameters

5 1 5

Pay off rule on

100% achievement

70% of CTC 10% of SM

income+ 2-8% of

SM income based

on targets

0.1-0.2% of team

premia+ 100% of

basic

Complexity score 7 1 1

45

Only for two firms: Birla Sunlife and Pru ICICI are the sales manager targets and derived

sales manager productivity similer. It is more likely that branch managers would have

made the cut

For HDFC there is a payoff to sales managers irrespective of target achievement it is

likely branch managers would have made any incentives

For the other firms it is unlikely that branch managers would have made any incentives!

Birla sunlife-salary and incentive structure

Level CTC(Rs.Lacs) Incentive

Branch Head < 18 2%-5% of advisor income

based on 4 parameters

Branch Manager < 12 10% of team income

Business Development

Managers

< 5 10% of team income+

Agency Manager structure

for own advisors

Agency Managers 2.5 – 3.1 15% of advisor income up

to 3 lacs and then upto 35%

for incremental slabs

46

Table representing the sample incentive structure for partner

Key responsibility area Weightage Unit

Premia 40% Rs.cr

Number of policies 20%

Activation 20%

Recruitment of advisors 20%

About 4 parameters are used to get the weighted score. The weighted score is the tied to

the pay-out grid(detailed subsequently)

The table representing the Sample pay-out grid for partner

47

Percentage achievement of target Pay-out as a percentage of advisor income

>80 0%

80% 2%

90% 2.5%

100% 3%

105% 4%

>110% 5%

For levels higher than partner, the pay-out grid will be same but for each separate branch

Pru ICICI salary and incentive structure

48

Table representing the ctc of all levels of Pru ICICI

Levels CTC(Rs.Lacs)

Zonal Manager 16

Regional Manager 11-13

Assistant regional

Manager

9.5-11

Branch Manager 7.5-9.5

Area Manager 6-7.5

Sales Manager 5-6

Agency Manager

-Unit Manager

2.5-3.25

Advisor -

49

There are three components to the incentive structure for the Unit Manager/Agency

Manager

Premia received

Productivity of

team(Rs.Lacs)

Incentive

1-2 2%

2-3 2.5%

3-4 3%

4-5 3.5%

5> 4%

+Number of policies

Number of

policies in a

month

Incentive(Rs.)

1-2 4,000

2-3

3-4

4-5

5> 20,000

+

Activization

50

Activization Incentive(Rs.)

7 Activization+2 recruitments+

7 lives(>7.5k)

4,000

… 20,000

Sample incentive structure for SM and Area Manager

The SM and the area manager have forms of incentives:

Quarterly incentives: 0.1%-0.2% of productivity of the team(typically target for Unit

Manager is 36 lacs and the target for SM and AM are rolled up)

The annual bonus ties to achievement of the following set of KRAs

Key Responsibility

Area

Weightage Unit

Productivity 40% Rolled up-a SM with 10

unit managers would have a

target of 36 lacs for the year

Activization of advisors 20% Targets are typically 45%

Number of policies 20% Branch wise

The weightage score varies between 1 to 5. The annual bonus is then linked to basic

salary(and not CTC)

HDFC standard life- salary and incentive structure

The table representing ctc of all the levels of HDFC standard life:-

51

Level CTC(Rs.lacs)

Regional Manager 24

Territory Manager 9-12

Branch Sales Manager 5.5-7.5

Assistant Branch Manager 4.5-5

ASM-BDM 2.75-3.25

Sales Development Manager 2.25

Policy Advisor

HDFC standard life salary and incentive structure

Table representing the salary structure according to targts:-

52

SDM-BDM The incentive and target vary for:

High Vintage(more than 18 months

in the system):

Target of 60 lacs per annum

Low Vintage(less than 18 months in

the system):

Target of 30 lacs per annum

Target Achievement Percentage pay-out on incremental basis

Less than 75% Nil

>100% 1%

>125% 2%

>150% 3%

>175% 4%

>200% 5%

<200% 6%

Sample incentive structure for branch manager and general manager

There are three types of pay-off for branch manager:

53

Pay-out 1:10% of income of sales managers

Pay-out 1:10% of income of sales managers on meeting branch target(for example on

meeting 75% of branch target, additional 2% is paid-out

Pay-out 3:2-8% of income of sales manager on meeting target of productive sales

manager i.e. number of low vintage sales manager getting more than Rs 33 lacs premium

for the year. For example a sales manager meets 33 lacs of target, the BM will make 2%

of his income

Aviva-salary and incentive structure

The table representing ctc of all levels of aviva:-

54

Level CTC(Rs.lacs)

Zonal Manager 18-21

Branch Manager 10-12

Deputy Branch Manager 6-8

Sales Manager <4.5

Assistant Sales Manager 2.25-3.25

The table representing the incentive of sales manager of aviva:-

Assistant Sales Manager/ Sales

Manager

Incentive vary from5%-25% of team commission

55

<1 lac no incentive

1-2lac: 5%

2-3lac: 10%

3-5lac: 15%

5-8lac: 20%

>8 lac: 25%

Sample pay-out grid for ABM/BM and Zonal Manager

The table representing ctc of all levels of aviva:-

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Parameter Weight

Advisor

recruitment

7.5%

Active

retention of

advisors

7.5%

Persistancy 7.5%

SM attrition 7.5%

Scale Weight

Level 1 10-20% of CTC

Level 2 30% of CTC

Level 3 50% of CTC

Level 4 70% of CTC

About 5 parameters are used to get the weighted score. Rating on the weighted score are

given a scale of 1,2,3&4.

Scale of 2 would be 10% higher than 1 and so on

For levels higher than Branch Manager, the incentive structure will have different targets

for each branch and are aggregated. However the incentives are capped at 60%

Reliance-salary and incentive structure

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The table representing ctc of all levels of reliance:-

Level CTC(Rs.Lacs)

Regional Manager 25

Area Manager 12-15

BM 7-9

ABM 4-5

Senior Sales Manager/SM 2.5-3.5

A very simple structure has been devised for ABMs and higher position. On achievement

of target, say~1.5 cr for the branch, the branch manager can make up to 100% of salary

Sample incentive structure for sales manager & SSM

For sales manager and SSM , the incentive structure is a function of three parameters

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1- commission

Monthly productivity Commission

<1,00,000 0%

<2,00,000 1%

<3,00,000 2%

<4,00,000 2.5%

<6,00,000 3%

<8,00,000 3.5%

<10,00,000 4%

2- Conveyance

Allowance

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Lives(AP>10k) Rs.

8 to 10 1000

11 to 20 1500

21 to 30 3000

31 to 40 5000

41 to 50 7500

51 and above 10000

3- Active advisors in a month

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Active advisor Rs.

Upto 4 0

4 to 6 1000

7 to 8 2000

9 to 11 4000

12 to 15 7000

16 to 20 9000

21 to 25 12000

26 and above 15000

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Profiles of sales manager across insurance firms

The table representing premia per sales and yield of sales manager of all the seven firms:-

Firm Reliance Birla Pru Aviva Bajaj HDFC

Premia per

sales

manager

(Rs Lacs)

9 49 32 30 15 11

Yield of

sales

manager

3 18 11 8 6 5

Take

home for

sales

manager

3.3 5.5 4.3 4.4 3 3.2

Birla SMs are the most productive per Rupee of salary paid

Birla SMs also enjoy the highest take home package on average

In firms where productivity per sales manager>30 lacs, take home tends to be higher than

Rs 4 lacs

The lowest take home package on average is for Bajaj

Yield for the SMs is lowest in Reliance

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The most relevant metric for an insurance firm is `yield of Sales Manager

There could be two reasons why this varies across insurance firms:

1. Best performing insurance firm gets better candidate pool because:

i. They pay higher than others and people with higher

salary at better yield

ii. They attract people from a particular background

which others are not able to

2. Best performing insurance firms have developed system

and processes which lets selects candidates better and also make them more

productive

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The table representing the analysis of sales manager on the basis of their favourite sector

and previous role:-

Firm Birla HDFC Pru Reliance

Favourite

sectors

F,T F,T,Policy

advisors

B,P, Fresher

MBAs

F,T,P, SMs

Previous role Team leaders

working with

finance

companies like

Birla Home

finance, Tata

home finance

Team leader in

liability and

asset side and

telecom

Banking

CASA, DSTs

Team leaders in

asset side,

telecome,

pharma and SM

with other firms

like Bajaj,Pru,

etc.

Firm Aviva Bajaj Kotak

Favorite sectors F,T F,T, SMs from other

firms

F,T

Previous Role Team leader from

CASA and asset

side

Shelters, DST of

foreign banks, SMs

from Pru, Met Life,

etc.

CASA profiles with

banks

F- Finance, T-Telecom, B-Banking, P-Pharma

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Firms also have very similar hiring strategies- focusing on three key sectors- finance,

telecom and pharma

Therefore the only factor explaining better sales manager performance could be that

insurance firms have developed systems and processes which lets selects better

candidates and also make them more productive

Max on the importance of processes

“There are two things I look for while hiring sales managers: field sales experience and

coachability- if the person has desire to be coached the processes he can be a good sales

manager. Delhi networks may not matter too much but person should have a good family

background, education and networks from where he/she is coming. People with top class

education typically don’t stick too much”

“ I look at people who are trainable and receptive for new things. Person should be non-egoistic.

Person should know basic of sales. Sales people from direct sales like Kent RO system, resort

sales and CASA team leader have worked for me”

Birla :

“ We have always been very quality conscious in Our hiring process. A branch manager will

go and visit the house of the prospective agency manager to see whether the family is also

excited about the candidate joining Birla. It also help to do a reference check”

“ The other check we do at times is to ask a Person to get 3-5 prospective advisors before giving

the offer letter. This gives us a very good sense of the seriousness of the candidate and also the

pool this person would attract as an advisor”

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CHAPTER-7

FINDINGS

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FINDINGS

The findings came by this study can be shown as follows:-

The first conclusion came by this study is that there are the difference between the

insurance companies in various level

By this study the fact came to know that there are different parameters for the different

insurance companies

The profiles of the sales manager is different in different insurance companies

By measuring the performance of sales manager it came to know that the companies

which are giving the higher renumeration to their sales manager they are performing

much better than others.

At last this study can be useful a lot to all other sectors because by measuring all these

parameters we can know that which are those levels where we have to improve and by

that the company can perform well.

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