Page |1

Assignment of “Organisational Theory and Behaviour (Subject Code:

4105)” submitted on 14th September, 2018.

“A Case study on Organisational

Behaviour of Ambuja Cements
Limited”

Submitted By: Submitted To:

Manas Upadhyay Dr Meghna Malhotra

Roll No. 14, M. Commerce Hansraj College

Hansraj College Delhi University

2018-2020
 Page |2

INDEX
Page Number

 Acknowledgment 03

 Content 04 - 15

1. Overview and History 04

2. Organisation 04-07
2.1 Nature, Style and Type 04-05
2.2 Challenges and Competitors 05-06
2.3 Structure and flow of command 07

3. Individual 08-11
3.1 Recruitment 08
3.2 Behaviour, Personality and Perception 08
3.3 Learning and Training 09
3.4 Motivation 10-11
3.4.1 Amenities 10
3.4.2 Awards and Recognition 10-11

4. Group 11-13
4.1 Culture and Communication 11
4.2 Team and leadership 12
4.3 Conflict, Stress Management and Work life balance 12
4.4 Gender Diversity and Issues 13

5. Other Stakeholders 13

6. Policies and Rules 14

7. Conclusion 14

8. Bibliography 15
 Page |3

ACKNOWLEDGEMENT

I would like to express my special thank of gratitude to my teacher Dr Meghna Malhotra who
gave me the golden opportunity to do this wonderful assignment on the topic “A Case Study
on Organisational Behaviour of Ambuja Cements”. This case study not only gave me a first-
hand practical knowledge about problems a company faces, but it also broadened my thinking
to find innovative and out of box solutions for them. The key points that needed to be focused
and guidance provided by ma’am helped me throughout the process of assignment
preparation.

I would also like to thank Mr Kaushik Kundu (Vice President Human Resource, Ambuja
Cements), to set aside few hours to talk and discuss (about Organisational Behaviour of
Ambuja and problems associated with it) amid his busy schedule. His vast experience and
knowledge brought some great insight into this assignment, he also discussed about the
problems and solutions; they are implementing to solve the threats and the problems. Inside
strategies and internal working mechanism to solve conflicts were also shared by him,
without his support this assignment would have been incomplete.

At last, I thank almighty, my parents, sister and friends for their constant encouragement
without which this assignment would not be possible

Manas Upadhyay

M.Commerce 2018

Hansraj College
 Page |4

1. Overview and History:

India is 2nd largest producer of cement in the world. It started growing post 1991, and
today it stands at its zenith. With growing India, cement industry too is moving in
tandem, various researches by S&P and Crisil shows that cement industry would
continue to outperform other sectors in years to come.

Ambuja was incorporated on 20th October, 1981 as Ambuja Cements Private Ltd. It
was jointly promoted by Gujarat Industrial Investment Corporation limited and NS
Sekhsaria, Vinod K. Neotia and Suresh Mulani, for setting cement plant in joint
sector. The company was converted into a public limited company on 19th March,
1983 and the name was changed to Gujarat Ambuja Cements Limited (GACL), and
then started the phase of rapid expansion with setting up and buying of new plants. In
2006, world’s cement leader Holcim acquires stake in GACL, and in 2007 it was
renamed to Ambuja Cements.

Ambuja Cements is market leader in North India and has control over nearly 22% of
cement business in India. It has 27.25 metric tonne capacity with 5 integrated plants
and 8 grinding units, with nearly over 115,000 employees in 8 states.

Vision: To be the most sustainable and competitive company in our industry.

Mission:

 To create value for all

 Delighted Customers
 Inspired Employees
 Enlightened Partners
 Energised Society
 Loyal Shareholders
 Healthy Environment

1. Organisation:

1.1 Nature, Style and type: Organisation’s nature, style and type play an important role
in its success and management. Also it determines how it treats its employees and
other stakeholders.
In case of Ambuja it has been dynamic and has changed with changes in ownership
and management. Ambuja started as an entrepreneurial venture and therefore, its
promoter gave enough time to its employees and was in close contact with them,
 Page |5

making it informal and people centric organisation. In Initial years of its

incorporation Ambuja had to face fierce competition from giant industrialists of
that time Birlas and Modis. Yet, since it was people centric, employees and
promoters both worked hard and were delivering results making it one of the best
examples of passion oriented organisation. Employees were so passionate that
even when increments were delayed by 6 months they were not cynical and knew
Ambuja will give increments with arrears; and Ambuja too met all their
expectations every time.

After 2006, when Multinational Holcim acquired stake in Ambuja, Holcim started
changing Ambuja’s nature, type and style. They brought system of checks and
balances, made more formal rules and systems, therefore making Ambuja a
systematic organisation with formal structures. Also Holcim introduced system of
Internal Audit in organisation. Amidst of all changes the people centric behaviour
was still intact in Ambuja, and management and promoter tried to meet all
expectation of its employees. For example after this increments were given on time
without delay. They made system Decentralised with region wise functions. In
short, Ambuja after 2006 brought all good things of a multinational while keeping
its basic style and nature intact.

After 2012, when Lafarge and Holcim merged together, the people centric feature
was lost, now the organisation is highly formal, structured and rule oriented, they
made structure more centralised with hard core functional structure, due to this
reason the employee turnover increased during this period; also veterans (those
who were there for a very long period of time) of Ambuja started to quit Ambuja.
Therefore, shifting from collegial to supportive type of OB.

Ambuja’s management has identified this threat and are trying to move back to its
inherent nature and style.

1.2 Challenges and Competitors:

Every organisation faces various challenges in today’s globalised era, whether it is

due to changing technology or political changes. Some of threats can affect its
existence. Organisations constantly monitor threats and try to take decisive action
to nullify its effects.

The greatest challenge they face right now is they are in 3rd stage of founder’s
mentality and scale graph. (See figure: 1).
According to James Allen, CEO of eVolution Global Partners, (a global venture
capital firm founded by Kleiner Perkins Caufield & Byers, Bain & Company; the
 Page |6

company as it starts to grow in size and scale it loses its founder’s mentality, and
once it loses founder’s mentality it loses its basic nature which makes it hard to
gain trust of its employees and therefore it also loses its scale and finally it goes out
of market.

Stage 1: This is the growing stage and starting stage where founder’s mentality is
high but scale or size is low, as shown in figure: 1, currently new industries like
Emami and Shree are in this stage, and in near future they will possess threat to
Ambuja. Ambuja till 2006 was in stage 1.

(Figure: 1)

Stage 2: This is ideal stage; here both founder’s mentality and scale; both are high
and desirable. Currently no company is in this stage, and Ambuja was here from
2006-2010, and Ambuja wants to come back to this stage as this will help them to
stay ahead in competition.

Stage 3: This is declining stage, Ambuja currently stands here, and here founder’s
mentality is least; as company grows and become more structured and formal,
employees tend to leave and finally company falls to stage 4 where they are out of
market itself.

Stage 4: Here, neither founder’s mentality is left nor scale, here company loses its
market share and is thrown out of the market. Example: JP Cement completed its
cycle and is on verge of getting out of market.
 Page |7

Good thing is Ambuja has identified its threat and is trying to overcome this flaw.

Other threats for Ambuja are: Huge pay in other sectors leaving cement sector with
few talented pool of human resource.

1.3 Structure and flow of command

Organisational structure makes it easier to understand various roles and chain of

command that needs to be followed by employees. Every major organisation has its
own structure and chain of commands.

Ambuja’s organisational structure and flow of command is concise and functional

oriented. Top executive is CEO and every other functional manager or head reports
directly to CEO.

Apart from this every employee can directly contact CEO about any issues which may
be bothering him/her. CEO also can contact any employee directly if and when
needed.

Although for decision making they follow mix of top-down approach and down-up
approach. For example: Targets are given by board and it is duty of every functional
head to decide how to attain it.
 Page |8

2. Individual:

2.1 Recruitment:

Every organisation need to filter out those people who can create disturbance and
can negatively affect environment of an organisation. Recruitment is the first entry
and filter point for every organisation. Organisations prefer to recruit people who
have same thinking and work ethics same as of organisation.

In case of recruitment, Ambuja goes from campus to campus; to recruit best talents,
also they give preference to wards of current employee as they would be already
acquainted with Ambuja’s culture and policies. Three of the most important traits
that every HR manager of Ambuja looks in every potential employee are:
Behavioural, Ethical and Knowledge aspect, these are 3 pillars of Ambuja’s
recruitment policy. They also hire, Background Verification Agencies to check
candidate’s testimonies and certificates are true, also there isn’t any pending
criminal case against him/her.

2.2 Behaviour, Personality and Perception:

Diverse behaviour and personalities of employees is the source of all problems in

organisation, every person has different way of behaviour and personality. These
behaviour and personality guide not only environment of organisation but also
affect productivity of firm.

At Ambuja each employee is given feedback at end of a period by their peers,

bosses and other stakeholders about their behaviour and personality and each head
of department meets each employee personally to discuss good and bad behaviour
of employee. The heads also discuss ways to improve the employees’ behaviour
and personality so that it is in tandem to organisations culture and environment.
Apart from this inter-departmental meetings are held regularly to discuss both
positive and negative actions of a particular employee, followed by brain storming
session to improve the situation. This whole process is called “Touch Point”.

Ambuja tries to allocate duties and responsibilities keeping in mind the nature and
personality of a person, various tools like online psychometric tests are used
regularly and if deviations are found, counselling sessions are given. People
working in hazardous areas like: mines or near 1000 degree Celsius kiln are
regularly given health and mental check-up.

Performance appraisal are called “Let’s Talk” as before giving performance

appraisal employees talk to their respective heads and each head of department
 Page |9

gives their feedback to them and also ask employees to do self-evaluation of

themselves and specify the expectations they have from organisation.

2.3 Learning & Training

It is rightly said a person must learn in every stage of life to grow and perform tasks
effectively and efficiently. Learning is a key through which any employee can help
organisation attain its goal and in turn organisation can fulfil individual goals of
employee. Training is in similar manner, a way of organisation to bring efficiency
in working of its employees. In Globalised era with fast changing world, training is
the only tool to keep employees updated of various new technologies and methods.
Also, young employees constantly push their managers to give them opportunity to
go for higher studies, so that it fulfil their individual goal and in turn can bring a
new pool of knowledge in the organisation.

Ambuja follows a Gurukul kind of learning and training. The learning methodology
is called “70:20:10”, while training methodology is called “Building Coaches”.
Apart from this every year Ambuja sends nearly 5-8 employees to various reputed
Educational Institutions around India and World to give them exposure, and learn
new techniques. Ambuja has tie ups with Institutions like IIM A, ISB Hyderabad,
MIT, Stanford University, etc… for this. The selection of candidates to be sent is
done on basis of the performance in the company and their zeal and enthusiasm to
learn new things.

“70:20:10”: Suppose there are 100 employees in production department and due to
new technology bought by Ambuja there is need to teach them how to operate. So,
Ambuja sends 10 employees to learn how to operate and run it. When this 10
comes back they teach other 20 employees, what they have learned there. Once 20
employees are taught, these 20 employees teach rest 70 employees how to run or
operate the machine.

“Building Coaches”: Ambuja identifies a particular employee from each

department who is proactive, learns everything quickly and is good with
communication skills. Then Ambuja sends these employees for a rigorous training
of 12 months across different institutes, to make them perfect in art of giving
training. Once these employees are done with training they come back and become
Internal Trainer of the department and they are required to keep update of changes
taking in world which can affect the functioning of their department, and share it
with the other employees regularly.

2.4 Motivation;
 P a g e | 10

“A person without motivation in life is like a bird without wings”. Money is one of
the crucial motivation factors in any organisation, but it should be noted it’s not the
only factor which determines and guides individual’s motivation.

The salary in Ambuja is although less than its competitors, yet its employee turnover
ratio (ETR) on average is less, (this ratio has spiked in last few years but it is
becoming lesser and lesser now). When asked about views on Ambuja’s Employee
turnover ratio, on scale of 1-10, Mr Kaushik Kundu (VP, Human Resource) said it to
be 6. (1- Being low ETR, while 10 being high ETR).

Also, since 2002, Ambuja has given ESOPS and Sweat Equity Shares to its
employees. It increases loyalty of employees towards company.

But Ambuja is providing various non-financial incentives which give it an upper hand
advantage over others.

2.4.1 Amenities:

 School: Ambuja runs its own schools which is under its own NPO
wing “Ambuja Vidya Niketan Trust”
 Hospitals: All Ambuja’s plants have their own hospital for basic and
primary health care. They also have tie ups with Max, Fortis and
various other top multi specialist hospitals for treatment.
 Interest free loans and lunch and dinner coupons are given at minimal
prices.
 They have their own guest house, where relatives of employee can
stay and eat at minimal charges.
 Rent free accommodation with free electricity and free water facility
is given to each and every employee.

2.4.2 Awards and recognition:

Ambuja to motivate its employees give them various awards and recognition;
each year best performing employee of each department is given a chance to
meet board of directors and get a trophy with cash prize from hands of
Chairman.
Also wards of employees who have secured top 3 positions in 12th and 10th
examination, among all group of Ambuja schools are given scholarship of Rs
25,000-Rs 100,000. Also each and every child of employees working in
mines is provided with the scholarship provided they have secured at least
60% marks.
 P a g e | 11

On premature death of an employee due to accident while he/she was

performing his/her duty, the company gives a hefty compensation to family
of deceased person, also if any of the family member is having basic
education, employment to that member is given in the company, according to
his/her level of education.

These different kinds of motivation are given to employees to keep them

happy and tension free, so that they can work peacefully and efficiently in the
organisation. Also these motivations cater to diverse needs and personalities
of employee.

3. Group:

3.1 Culture and Communication:

In every organisation group culture is essential as it monitors the environment

of Organisation. Ambuja’s culture is more of informal and people centric one.
Here voice of each individual employee is heard and decisions are taken by a
team. This culture has aroused the feeling among employees of Ambuja as
their own company. The unit heads of each plant conduct various team
activities and informal get-togethers to instil sense of belongingness and
togetherness among all employees. Every year on 31st December every
employee and their family members are invited for New Year Celebrations, all
the expenses of mass dinner and conducting of games are borne by company.
Apart from this there are two clubs; Gents Club and Ladies club, they conduct
their own activities so that informal interaction among employees keeps
happening in regular intervals.

Communication is essence of organisation, it is artery of any organisation,

even minor fault in it; can bring disastrous consequences to an organisation.
All communication are done by Email and CEO constantly keep everyone
updated about changes and steps taken by top management in this way,
Ambuja try to fill loop holes which can give birth to rumours. Making it a
direct communication channel between top management and employee,
instead of scalar chain.

3.2 Team and Leadership:

 P a g e | 12

Each department is represented as team in Ambuja, and they regularly conduct

meeting to synergies their effort to meet the desired goal. At beginning of each year
every team sets goal, then at mid-term they review their goal and take necessary
corrective action. In the end teams which acquire their targets are rewarded. In this
way they try to bring feeling among employees of their department being a family.
Leaders are like captain of ship they steer organisation through tough and hard
times and make organisation successful.
Leadership in Ambuja has never felt vacuum, like Infosys or Tata majorly because
of talented leaders constantly coming and taking their position and working hard. It
has mix of Autocratic and Participative leadership style, and the kind among two is
chosen according to demand of situation.

3.3 Conflict, Stress Management and Work life balance:

A group of people will always have conflict, but sometimes conflict can rise to
levels which can affect productivity and efficiency. Therefore, in any organisation
conflict management needs to be dealt strictly.
Ambuja in its policy follow a proper protocol for this, first matter of conflict is
taken one level higher (to head of department), if it’s still not resolved, HR
managers sit and try to act as arbitrators. If still it is not resolved it is handed over
for enquiry to a specialised team called knowledge group. This team make enquiry
into matter and then suggest the best solution (it may be to transfer one of the
employee etc…).

Stress and performance pressure among employees are common these days,
increasing competition is worsening the situation. Need to reduce stress among
employees in prime goal of an organisation.
To reduce stress Ambuja has mandatory 15 days Leave for travel, also it gives good
amount of money as Leave Travel Allowance. Also they have opened up spa and
gym for each and every employee inside the company campuses. Inter department
sport activities are conducted every 6 months to reduce stress and increase physical
activities.

Work life balance is concept that supports the fact that the efforts of employees to
split their time and energy between work and the other important aspects of their
lives. It is becoming one of the most important concepts in modern Human
Resource Management.
In Ambuja each and every employee has fixed working hours with 2 sick leaves per
month and weekend is off. This gives employees enough time with family. When
asked question on this Mr Kaushik Kundu replied Work life balance is very high in
Ambuja, on scale of 1-9, it is around 8. (1- being lowest; 9- being highest).
 P a g e | 13

3.4 Gender Diversity and Issues:

Gender diversity is now not only a necessity, but it is now a way to show how
mature and globalised an organisation is.
Ambuja follows at least 10% gender diversity policy, but currently only 2% of
employees are female. Reasons for this are primarily two:
1. Many educated female employee are finding pay from service sector attractive.
2. After marriage they migrate to other places where Ambuja doesn’t have any
presence or they are not ready to join again due to social and spouse pressures.

But, slowly Ambuja is trying to reduce the gap, it has plans to recruit and retain 500
female employees by 2022, it also has started to recruit at least 70% of female
candidates from a particular campus.
Keeping in mind the latest amendment in Maternity Benefit Act, it has increased
the maternity leave to 26 weeks and also has provided for crèche facility inside the
offices. Also, every ladies washroom has sanitary pads dispensing machine.
It also implements Prevention of Sexual Harassment in Workplace Act, very
stringently. If any employee is found guilty, he/she will be terminated immediately.

4. Other Stakeholders:

Employees cover majority, yet not complete part of an organisational behaviour, there
are other stakeholders which are external to organisation, yet affect internal working
of organisation.
 Customers: Ambuja was the first one to start after sale service of cement,
before this cement was considered to be just commodity, Ambuja started with
making it a brand.
 CSR: Ambuja Cement Foundation spends a lot of money on rural
development; it has made roads, dams; it has given financial incentives to
Para-Olympics participants from India and provided books to government
schools etc…
 Suppliers: It makes sure each of the suppliers is paid on time, without any
delay and cumbersome formalities.
 Investors: Even after meeting needs of all its stakeholders, it delivers results
that all the investors expect from Ambuja.
 Environment: Ambuja is water positive organisation, it uses rain water
harvesting methods to use water to run its plants and the surplus water is used
to recharge ground water levels. Also it has created an oxygen zone near its
plants; use of Electronic Static Precipitators in chimneys ensures no hazardous
gas is released into atmosphere.
 P a g e | 14

5. Policies and Rules:

Ambuja follows strict policies and rules, some of the key policies are
mentioned below:
 Free from drugs and alcohol in workplace.
 Stringent punishment for Insider Trading
 Policy on Third Party Confidentiality
 Anti-bribery and corruption free policy
 No receiving of gifts from any supplier
 Against facilitation payments made to Government employees
 Strict safety norms and compulsory wearing of tools and gears
provided for working in dangerous environment

6. Conclusion:

Ambuja is people centric, market driven organisation, which aims to do its

business in most ethical way possible. Ambuja tries to include diverse opinion
in its decision making; it also tries to maintain diversity in its culture, bringing
people with different perceptions and personalities together and making them
work as a unit. It not only employs traditional way of motivation, but it also
tries to inculcate modern and new methods of motivation. Its employees work
with motto of “I CAN”, which is a tagline of Ambuja. It also tries to balance
the needs and demands of various stakeholders, without deviating from end
goals. Like any organisation, it’s not free from threats and problems. Lost
founder’s mentality is hampering its image in mind of old employees. The
negatively skewed, gender diversity, is also raising a lot of questions about its
culture and policy of recruitment. The reports of accidents in its plants are
raising questions about safety policies and training. Accidents in plants not
only increases cost on account of compensation given, but it also results in
loss of Ambuja’s loyal and committed human work force. The entry of new
comers in the cement sector offering high and attractive packages to the
talented work force is biggest threat to the goal of Ambuja. The positive thing
about all this is Ambuja has identified its threats and weak points and are
working to overcome these issues. Quick adaptation of latest technologies like
Enterprise resource planning (SAP), streamlines all the processes and makes
Ambuja one step ahead of its competitors. The goal of Ambuja to become a
market leader in the country and create a brand image of being best in
industry is not far. Yet, solutions to threat with slightly increased financial
motivation can do miracles to an already established firm. In the end,
Organisational Behaviour study and application is not static concept but it is
 P a g e | 15

dynamic and continuous one, so continuous monitoring with identification of

threat and formulation of strategy, must happen at all the time.

7. Bibliography:

 ambujacement.com
 shodhganga.infibnet.ac.in
 hindubusinessline.com
 Book: “Founder’s Mentality” by James Allen and Chris Zook
 Personal meeting with Mr Kaushik Kundu (Vice President- HR)
(Visited Ambuja Corporate Office on 5th September, 2018, Wednesday)