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Acknowledgement We thank our OTS guide at IRMA, Prof. Nirlesh Kothari who guided us during the Organizational Traineeship Segment of the PRM course. We extend our gratitude to Mr. Sriniwas Revanur, our reporting officer during the OTS and Sales Manager (Rural Business), ICICI Prudential Life Insurance Company Limited for making our organizational segment a learning experience We thank Mr. A. L. Narsimahan Murthy, Chief Functionary and Secretary of Grama Siri and Mr. S.C.Hassain, CEO of Star Microfin Service Society for extending full cooperation. Without their support and encouragement the project would not have been possible. We also thank the staff at Grama Siri and Star Microfin Service Society for extending their full cooperation. We are eternally indebted to them for their kind support. Mukul Kumar Singh (25026) Shahid Ahmad Khan (25098)

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Executive summary I. Project Title : Understanding Organisation II. Organization : ICICI Prudential Life Insurance Company Limited. III. Reporting Officer : Mr. Srinivas Revanur IV. Faculty Guide : Prof. Nirlesh Kothari V. Student’s Name : Mukul Kumar Singh (25026); Shahid Ahmad Khan (25098) Objective: The objective of the study was to develop an understanding of the two channel partners of the ICICI Prudential Life Insurance Company Limited, namely GRAMA SIRI & STAR MICROFIN SERVICE SOCIETY, (SMSS) Scope: The study was confined to Baptala Mandal in Guntur district with regards to Grama Siri and Velgode Mandal in Kurnool district with respect to Star Microfin Service Society (SMSS). Methodology and source of data: For Grama Siri, we interviewed the chief functionary. Thereafter we made visits to the network organisations of Grama Siri and interviewed its chief functionaries. At Star Microfin Service Society, we interviewed the CEO of the MFI. We also interviewed the central team manager of the MFI and other staff members, like central team associates, area manager, respective branch managers, loan officers, office mangers of the respective branches. The secondary source includes annual reports, and financial statements of last three years. Major findings: Grama Siri is a flat organisation with wide span of control. The board of directors at Grama Siri and its network organisations has respectively nine members each. The members of the board are chief functionaries, staff from the Grama Siri and the partner organisations. However the authority rests with the chief functionary of Grama Siri, who is also the promoter of the network organisations. Grama Siri carries out a host of activities from its inception which include micro credit activity, insurance as channel partners of ICICI Prudential, AIDS awareness campaign which is funded by Bill and Milinda Gates Foundation(BMGF) and Hindustan latex family planning trust(HLLFPT), health projects which is funded by Save The Children Fund(SCF). The recruitment of staff is very informal and local, which is being done by the chief functionary of the respective organisations in the network. With regards to micro credit activity of Grama Siri, there has been change in its strategy of the MFI since 2003. Prior to 2003, Grama Siri was lending through its partner organisations. However presently it directly lends through SHGs formed by it. It has completely stopped lending through partner organisations. Star Microfin Service Society is a three tier organisation which is headed by a CEO. It also has a central team headed by a central team manager. The central team has two central team associates and a social security manager. The MFI has three branches within a radius of 50 kilometers. There are three area managers who look after the three branches which are in turn headed by three branch managers respectively. Each branch has loan officers, office managers and office assistant. The MFI has a total of 38 employees. It has concrete plans to open three new branches within this year, for which have already conducted the market survey. Conclusion: To sum up, at Grama Siri, the second line of command is absent. There is no growth orientation in the partner organisations. The board is weak in the sense that it does not ask for management accountability. The board does have people from diverse set of skills. The partner organisations have not been able to mobilize funds from diverse sources. They are basically dependent on Rashtriya Mahila Kosh (RMK) for funding, though two of the partner organisations have approached local branches of nationalized banks for the same. At Star Microfin Service Society, the organisation has plans for expansion in far off Ananthapur District. Also there is lack of clear roles and responsibilities for the staff. Of late, the MFI has been successful in mobilizing its funds from different sources. The MFI does not have any finance manager to interact with the funding agencies which ask for intricate financial details like cash flow, funds flow, projections, ratio analysis etc. from the MFI. Also the expansion plans would result into scaling of operations of the MFI. Therefore the MFI has decided to make structural changes with expansion plans in mind. The present organisation structure therefore had to be redesigned, with this in mind.

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Table of contents 1. Background……………………………………………………………………1 2. The organisation – Grama Siri ………………………………………………..4 2.1 Basic details about the organisation and brief history……………………….4 3.Understanding the organisation………………………………………………..6 3.1 Values, Vision And Mission…………………………………………7 3.2 Governance…………………………………………………………..7 3.3 Strategic Planning……………………………………………………10 3.4 Resource Development………………………………………………11 3.5 Human Resource Management………………………………………12 3.5.1 Selection and recruitment………………………………….12 3.5.2 Job analysis………………………………………………...13 3.5.3 Compensation……………………………………………...13 3.5.4 Training…………………………………………………….14 3.5.5 Promotion………………………………………………......14 3.6 Organizational Culture……………………………………………….14 3.7 Compliance and Accountability……………………………………...15 3.8 Management Systems………………………………………………...16 3.8.1 Accounting and MIS ……………………………………….16 3.8.2 Information flow……………………………………………17 3.8.3 Tracking system for overdues………………………………17 3.8.4 Financial Planning and Control Systems…………………...17 3.9 conclusions on Grama Siri……………………………………………18 4. The organisation- Star Microfin Service Society……………………………....19 4.1 Basic Details about the Organisation…………………………………………19 4.2 Brief History…………………………………………………………………..20 5. Understanding the organisation………………………………………………...25 5.1 Values, Vision and Mission…………………………………………...25 5.2 Governance…………………………………………………………....26 5.3 Strategic Planning……………………………………………………..28 5.4 Resource Development………………………………………………..28 5.5 Human Resource Management………………………………………..28 5.6 Organizational Culture………………………………………………...29 5.7 Compliance and Accountability……………………………………….29 5.8 Management Systems ………………………………………………...28 5.9 Conclusions on Star Microfin Service Society………………………..29. References…………………………………………………………………32 Annexures……………………………………………………………..33-36.

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LIST OF TABLES Table 1: Source of funds……………………………………………...6 Table 2: Loan Products of SMSS……………………………………23 Table 3: Details of Loan Products…………………………………...24 Table 4: Risk & Corresponding Risk Coverage……………………..25

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List of abbreviations 1. BCs

: Backward Classes

2. BMGF

: Bill & Milinda Gates Foundation

3. CEO

: Chief Executive Officer

4. GS

: Grama Siri

5. HLLFPT: Hindustan Latex Limited Family Planning Trust 6. IOB

: Indian Overseas Bank

7. IT

: Income Tax

8. MIS

: Management Information Systems

9. NMDFC: National Minorities Development And Finance Corporation 10. RMK

: Rashtriya Mahila Kosh

11. SCs

: Scheduled Castes

12. SHGs

: Self Help Groups

13. SIDBI

: Small Industries Development Bank Of India

14. SMSS

: Star Microfin Service Society

15. STs

: Scheduled Tribes

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List of Annexure 1. Audited Balance Sheet of Grama Siri for the year 2004-05………………..33 2. Audited Balance Sheet of SMSS for the year 2004-05…………………….34 3. Profile of Chief Functionary of Grama Siri…………………………………35 4. Profile of CEO & MD of SMSS ……………………………………………36

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