Building HRM Capabilities

The Amara Raja Group

By Group 25

Kavya Arora - RH23065

01
Abhilasha Deshkar - RH23006
02
Sharmistha Bose - RH23122
03
Shwetambari Thakur - RH23132
04
Srinivas Anand - RH23139
05
Piyush Gupta - RH23095
06
 Case Facts
The Amara Raja Group (ARG) is a diversified conglomerate in India. The organization was founded by Mr. Ramachandra Naidu
Galla in 1985. The vision, with which the group was started, was to create rural development and non-migratory employment
opportunities in India.
The flagship company of the group is Amara Raja Batteries Ltd. (ARBL) with ‘Amaron’ being its flagship brand. The vision of the
group for the year 2025, is to have a turnover of INR 60k crores and a workforce strength of 60k employees
The group has a unique and distinct set of values & culture, that make the company stand out in the market.
These have been documented as ‘The Amara Raja Way’
The 5 key core values of ARG are:
Innovation, Experience, Entrepreneurship, Excellence and Responsibility

● The evolution of the Human Resources function in the organisation took place in the following phases:

● The current HR Structure – HRM as strategic partner :

 Q1. What are the strengths of ARG in terms of values, culture and people?
What are the challenges?
STRENGTHS:
• Through ‘The Amara Raja Way’, the organization shows a growth-centric approach
and is strategic when it comes to its business. Employees are seen as strategic assets
and treated equally. Innovation, excellence, entrepreneurship, experience and
responsibility form the core values and a lot of thought and effort is given towards
employee engagement, development and performance
• The organization regards its employees as well as their family members as a part of
the larger organizational family and as important stakeholders - this has helped to
ensure interpersonal relations, longer employee tenures and their continued loyalty
towards the organization
The overall employee experience is of primary importance and profits are given a
secondary status. The values of the organization push its employees towards a defined
direction and feel respected, empowers them to share their ideas and take decisions,
execute these, and grow
• There is a collaborative and productive relationship shared between the line
managers and the staff managers. Teams are given opportunities to engage in
constructive criticism and challenge the thought process, both internally as well as
with their external clients
The organization ensures that all their stakeholders are aware and appreciative of the
way they think and why the organization exist
• A team of visionaries constitute a part of the organization’s leadership and
management - they are astute with their planning and assessments, and have faith in
the power of using advanced technologies
• The organization’s allegiance towards corporate social responsibility (CSR) and social
service as part of their organizational culture is noteworthy
CHALLENGES:
- The shift in focus of the Managing Director with a dual opportunity of becoming a
Member of Parliament (MP)
- Before 2005, a formal human resource management (HRM) function and leadership
in the organization lacked stability - employees with management backgrounds took
care of the HR activities along with their regular roles and responsibilities. Thus, the
foundation of the HR function in the organization was formerly shaky and not formal
in nature, and took some time and a strong leadership to stabilize (to transition from
being reactive to being proactive)
- Since the HR Department of the organization developed in phases, HR related
policies, systems, communication mechanisms and processes also evolved slowly
overtime - thus, it took some time for the overall organizational structure to become
consistent in its functioning and for internal communication channels to improve
- The organization had to invest a tremendous amount of time and efforts in building
the HR Department as a collaborator in business decision making and not just for
merely fulfilling statutory obligations
- Decision making became a lengthy and time consuming process due to multiple
layers involved in the approvals system, business heads’ lack of flexibility in taking
decisions, a lack in the understanding of business and hence, the inability of putting
the needs of the business to the Group HR
- The HR was not focused on building the leadership capabilities of management cadre
and rather burdened with many HR-Admin. activities
 Q2. How successful were the changes at ARG in the HR department?

HR Department at ARG
Evolution - The evolution of HR Dept at ARG can be broadly classified into 3 phases. Since its inception, the HR Dept at ARG
underwent a transformation by advancing from a traditional personnel dept to a strategic business partner to enable the organisation
achieve its objectives of Vision 2025. Rather than just executing routine operational and administrative work initially, to further taking up
a reactive approach to resolve issues, the HR Dept slowly evolved to a proactive role in shaping the culture and strategy of the
organisation.
Policies and Initiatives - To improve employee engagements, the HR Dept was instrumental in initiating various policies and procedures
that focussed on talent acquisition, employee development, performance and progress. It also focussed on employee well-being. These
approaches were proactive in nature and helped in a holistic approach towards employee welfare and organisational development.
External Assessments - The dept was involved in external assessments which helped it in understanding itself better and improve
practices. Analytics and reports that were available helped in valuable insights into the pros and cons of the departmental operations.
Challenges
1. In spite of development and progress in various aspects, one of the main challenges that were faced by the HR Dept was the
resistance from business head who felt that there was a greater alignment needed in terms of the HR Department’s approach and the
organisational requirements. They felt the need to have better communication, coordination and collaboration from the HR
Department’s side with the business units.
2. The remote locations of the facilities posed a challenge in attracting the right and qualified talent. This emphasized the need for
implementing robust talent management processes that encompassed recruitment, managing and nurturing talent.
 Q3. Does the HR structure of ARG do justice to the Dave Ulrich HR Model ?

● The Dave Ulrich HR model is an HR Framework Model that approaches the roles and responsibilities of HR professionals across the 4
key areas - Strategic Partner, Administrative Expert, Employee Champion & Change Agent. Ulrich advocates for more strategic and
business focused approach to HR, thereby offering value to organisation and all the stakeholders.
● ARG, initially in its 2 phases of HR operations, didn’t have a particular framework and focussed more on being a support function to all
employees. Slowly ARG’s HR Department evolved to implement the Dave Ulrich model. But over a period of time, it even went on to
adapt the HR Department, dynamically, to cater to the specific needs of the organisation.
● ARG structure does justice to the Dave Ulrich model and the below aspects are a few examples to illustrate the same:
○ Strategic Partner - HR Activities have been aligned with the Vision 2025 of ARG
○ Change Agent - Implementation of Agile functions
○ Employee Journey - Employee Experiences Survey
○ Administrative Expert - Creation of Shared Services Division and Centres of Excellence
Also, the aspects of Talent, Culture and Leadership also have extensively been catered to, by the HR Dept of ARG
● However, there are aspects of in the ARG’s HR Department’s way of functioning,a that seem to deviate from the Dave Ulrich Model in
the below ways:
○ There is a lot of scope for the HR Dept to act as a Business Partner as the Dept is still reactive in many of its approaches.
○ The dept is facing challenges in balancing its roles and responsibilities of Business HR and Group HR
○ Also, there is a lot of scope for the HR Dept to embrace the technology and analytics capabilities as advocated by the Dave Ulrich
Model. The HR Dept has implemented technology to automate a few aspects but there are many to be covered in this.
 Q4. Critique the Dave Ulrich HR Model in the context of this case.

• While the Dave Ulrich model provided a structure for the growing organization, ARG, there were still some demerits to consider:
- HRBP Structure: BHR identified them more strongly with members of HRC than part of respective business This resulted in:
Lack of flexibility where processes were not adaptable enough to accommodate the evolving needs of individual businesses
The individual businesses were treated with a ‘one size fits all’ approach where all policies were finally approved in HRC and hence,
needed to be equally adaptable to all types of businesses
BHR was making more of a proposal to the Group HR, rather than informing the Group HR about the changes they want to make that are
relevant to the business
- Shared Services: although a separate team to manage administrative tasks was created, there was a difference in perception from varied
stakeholders
○ Group HR Head thought that shared services were created to take care of the transactional part, and they are doing a good job
○ Business managers thought that they, despite having such a team, the BHRs are burdened with so many HR administrative activities
and hence, were not able to focus on building the leadership capabilities of the management cadre employees
- Centre of Expertise: a lot of structured work was done to create multiple CoEs, however, this created the issue that the CEOs of the
businesses did not hold the full authority and freedom to implement customized HR policies and procedures for their respective
businesses.
 Q5. Can the current HR structure of ARG sustain and align with “Vision 2025”?

• There are a few gaps between the current HR structure and the focus, which might result into misalignment with Vision 2025

- Purpose of restructuring – the purpose of restructuring was to shift the HR focus from transactional activity to strategic inputs.

However, the current BHRs still involved in a lot of transactional activities than providing strategic support

- Presence on the floor – the expectation from the BHR was to work more on the field/shop floor to understand business challenges and

design the HR strategy with an alignment to business goals. However, the business heads have complained about BHR presence on

the floor which shows clear disconnect between the BHR and the business heads

- Decentralization of work – the decentralization of work has been done with the purpose to provide strategic support to the business

by the HR team. However, the HR team were still involved in transactional activities

- Considering the HR team’s greater involvement in transactional activities rather than transformational and value added activities, we

feel the current HR structure of ARG will face issues in sustaining and aligning with Vision 2025
 Q6. What issues might the HR department face from line managers as the
organization scales up to achieve its Vision 2025 targets?

• Alignment with Vision 2025 goals of 60k employees and becoming a 60k crore group: the HR Dept might face 2 significant
challenges with respect to line managers
• To ensure that line managers are fully aligned with the Vision 2025 goals
- Talent Acquisition: As the organisation expands to meet the targets, getting the line managers’ support in managing the different
facets of acquisition like recruitment, orientation with work & culture, and development of talent could become very challenging
- Performance Management: With an upscale to such a larger workforce, the HR Department’s challenge in ensuring that line
managers are measuring and managing performance, effectively & efficiently, could be very huge
- Change Management: In the journey towards Vision 2025, there might be many changes in the organization structure and strategy
which the line managers may either find difficult to understand and apply, or resist and struggle to implement
- Training and Development: Line managers may themselves require elaborate and detailed training and development to scale up
their capacities and capabilities to manage a larger team. They might require extensive upskilling in terms of understanding and the
implementation of newer business strategies
• To ensure that the line managers are effectively communicating these goals to their teams
- Maintaining effective communication with line managers can become extremely stretching as the organization grows in line with
the 2025 vision
- Line managers to devise ways of effectively communicating and measuring the goals to achieve the 2025 vision
THANK
You