SALARY AND COMPENSATION MANAGEMENT

TERM PROJECT - FALL 2014

Organization:
EFU GENERAL INSURANCE Ltd.

Prepared For:
Sir Asad Hasan
Section: Z

Prepared By:
Anum Abdul Hameed Jessani
Tehmina Hafeez
Ramsha Tariq

(11357)
(12079)
(11311)

Date:
Nov 30th, 2014

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ACKNOWLEDGEMENT

We would like to thank Mr. Riaz Ahmed, Executive Vice President and Mr. Zubair
Ali, Vice President of EFU General Insurance Limited, Clifton division; who
generously took time from their busy schedule and benefited us with their
precious knowledge and expertise. Had it not been for them, this work would not
have been possible to accomplish.

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Table of Contents
ACKNOWLEDGEMENT ............................................................................................ 2
Vision Statement ................................................................................................... 4
Mission Statement ................................................................................................. 4
Values of Organization ........................................................................................... 5
Integrity & Ethics ................................................................................................ 5
Excellence ........................................................................................................... 5
Professionalism................................................................................................... 5
Our People .......................................................................................................... 5
Corporate Social Responsibility........................................................................... 5
Questionnaire ........................................................................................................ 6
Decision Making Process ........................................................................................ 7
Goal Setting Process .............................................................................................. 8
Motivational Practices for the Employees.............................................................. 9
Corporate Social Responsibility ............................................................................ 10
Culture of the Organization ................................................................................. 11
Recent Example of Violation of Laws in the Company ......................................... 12

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Vision Statement

Our vision is to be the first choice company for our customers, shareholders and
employees. To achieve this we will be driven by an obsession to be better than
the best in a continuous journey, not a destination.

At EFU first choice means a sustained commitment to meet and exceed

stakeholder expectations. We will to go Extra Mile to delight our customers with
products and services that exceed their expectations.

Mission Statement

We will manage our affairs through modern technology, collective wisdom and
institutionalized leadership. We will be a respected, cultured and an educated
company with a strong market position. Together with our customers, reinsurer
and employees we will achieve world class quality standards through continuous
quality improvement. Achieve zero defects in everything we do.

We will do good business, with good clients and of the highest integrity. We will
not compromise our principles and we will like to be known as a responsible
corporate citizen aware of our obligation to the Government and the society we
serve.

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Values of Organization
Our philosophy is to be the leading company with service above par, with
integrity, excellence and professionalism. Following are our core values:

Integrity & Ethics

Conduct business with ethics, dignity, fairness and transparency.

Excellence
We measure our performance by results but more by quality of service.

Professionalism
We believe professionalism is perfection. Business resources are utilized in a
manner to achieve optimum returns on resources.

Our People
In EFU we work like a family. Everyone is treated with respect and without any
discrimination.

Corporate Social Responsibility

We donate to various institutions in health and education sectors, for improving
the lifestyle of common man.

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Questionnaire
We asked them the following questions:
How do practice professionalism?
How do you treat your employees?
What happens if an employee violated the company rules and regulations?
What concrete steps do you take to achieve excellence?
How did you cope during the economic recession?
Who sets the goals at EFU?
Are these goals short term or are they meant for a longer period of time?
Are the employees involved in setting their own goals?
How do make sure that the goals are effectively met?
How often are the employees appraised?

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Decision Making Process

This process answered our question: How do you practice professionalism?

Decision making in EFU general is done in a very systematic manner. Overall

corporate decisions are taken in the Head Office by the Senior Executive
Directors. Then if they unanimously accept the decision, it is passed on to the
zonal heads (Northern and Southern Zones), and the zonal heads in turn convey
the decision and its associated work to the division heads and they to the Branch
heads. The branch heads then give specific working instructions to the
departments needed, to implement the decision.

This was an example of decision making from top to bottom. Decision making can
also be done vice versa, i.e. from the operational heads to the Senior Executive
Directors depending on the nature of the problem and the duration needed for its
response. In such a case, decisions made by the department heads are sent to the
Senior Executive Directors for the approval.

This shows that not only the voices of seniors are heard, but the managers and
operational heads can also voice their opinions. This shows that the core value of
Professionalism is not only confined within the boundaries of board room with
executives sitting in it.

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Goal Setting Process

This answered our questions: Who sets the goals at EFU? Are the employees
involved in setting their goals? How do you make sure that the goals are
effectively met?
Like Decision making process, goal setting in EFU is also done in an organized way.
For example, a specific target has to be achieved by the organization i.e. raising 10
% profit or introducing a new insurance policy. Such a goal is set by the Head
offices and they formulate a Strategic plan to achieve that goal. The target is then
sent to the Branch heads, who in turn formulate a Tactical plan to achieve that
tactical goal. The Branch heads then distribute the work to different departments.
The departments then formulate operational plan to achieve operational goals.
The head office continuously supervises and keeps a check as to see if things are
going as planned.
This shows that EFU General Insurance maintains Professionalism in its goal
setting process as well. And also practices Excellence by making sure that at
every stage the set goals are effectively met. And if they find issue in the goal
setting process, corrective action is taken immediately to remedy that problem.

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Motivational Practices for the Employees

This process answered our question: What concrete steps do you take to achieve
excellence?
Their answered revealed their motivational and appraisal process. They told us
that in order to achieve excellence, they motivate their employee by appraising
them annually.

The organization is very particular about motivating its employees. It appraises its
employees annually in order to see their progress and provide them with rewards.
EFU general truly believes that the business of the organization is dependent
upon the effective working of the marketing department in particular. Therefore,
the marketing heads are given foreign tours twice a year to Middle Eastern and
south Asian countries, in order to appreciate and encourage their sincere work for
the organization.
Moreover, medical insurance is provided to all the employees and education and
life insurance is given to some elderly and dedicated staff members and their
families even.

After getting to know this process, we believe that EFU General Insurance Ltd. is
not doing enough to achieve its core value Excellence. because they conduct
and appraisal of employees annually, and this is not enough to motivate
employees. Conducting an appraisal once a year is demotivating because
appraisers dont keep track of the employees efforts over the whole year, rather
only recent efforts are considered. Also, this method does not provide feedback
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which will help employees know where they stand and what they need to do to
move ahead.

We suggest that the company use a Performance Management System that

would help employees achieve excellence in its true sense. Quarterly reviews and
feedback will help employees to train themselves and work on their weaknesses.
This will also allow appraisers to conduct appraisals more effectively having
detailed knowledge of each employees activity over the year.

Corporate Social Responsibility

This process answered our question: How did you cope during the economic
recession?

It is a philosophy held by the company's founding fathers that employees should

not be laid off. In the current global recession also, the company did not lay off
even a single employee. However, they believe that in such crucial times, they
would rather reduce the salaries of the employees but will not lay them off. The
company firmly believes that their employees in turn, support their respective
families. And by firing even a single member can completely ruin his family. This is
the most important aspect of company's fulfilling its corporate social
responsibility.

This shows that even during doldrums, the companys core value of Corporate
Social Responsibility is sustained. They do not lay off employees, rather
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decrease their salaries to compensate with losses. They are consoled that they
will regain salary status once the company is out of the recession. This also
improves the companys image in the market, hence goodwill.

Culture of the Organization

This process answered our question: How do you treat your employees?

EFU, being Pakistan's largest insurer, has a huge responsibility to keep fulfilling
country's growing need of insurance. The employees are dedicated and sincere
and work selflessly to achieve different business targets. In turn, when the
company achieves such a long desired target, the top management organizes a
big event to celebrate the success. Some unofficial days are also celebrated like
Shab-e-Barat etc. Both the Eids; namely Eid-ul-fitr and eid-ul-Azha are long
awaited events, when the whole organization gets together and celebrates.

Diversity issues in the organization are solved by the middle management

committee. They try to bridge the employees by interacting with them and trying
to understand their problems and insecurities.

This proves that the company practices its core value of Our People. EFU
General Insurance Ltd. Values its people and celebrates our yearly occasions
together. Employees are treated alike.

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SALARY AND COMPENSATION MANAGEMENT

Recent Example of Violation of Laws in the

Company
Upon asking the question: What happens if an employee violated the company
rules and regulations? Mr. Riaz Ahmed answered us by giving an example of a
recent example of rule violation. There is one executive who was involved in case
of a fraud. He was taken and kept in custody for over a night, and now a case of
committing fraud has been charged on him and further investigations are being
conducted. Meanwhile, hes not allowed to resume his office work.
This shows that EFU practices its core value of Integrity & Ethics. It abides by
the rules that the company has set and punishes those that do not abide those
rules.

READ!
Interview with riaz ahmedhis words :
:P:P
At EFU General, we deliver value in many ways. We operate above and beyond the profit
principle and this is our consistent tradition. Consciousness of the quality of our product and
service is always a core concern with us. We continuously implement strategies and programs to
improve both. EFU General is the insurer that provides people the finest security against
unforeseen circumstances.

Values of efu should be (according to us) :P

Leadership power to protect and for all class of people
Performance XYZ
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Excellence never ending inspiration to excel

Business strategies consistent enhancement and growth

Mission
Their years of experience and expertise, coupled with ability to settle claims swiftly,
enable them to provide people the most reliable protection

Vision ?????? :P

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