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Compensation Practices Essay

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About GP Grameenphone is now the leading telecommunications service provider in the country with more than 16 million subscribers as of December 2007. Presently, there are about 30 million telephone users in the country, of which, a little over one million are fixed-phone users and the rest mobile phone subscribers. Starting its operations on March 26, 1997, the Independence Day of Bangladesh, Grameenphone has come a long way.

It is a joint venture enterprise between Telenor (62%), the largest telecommunications service provider in Norway with mobile phone operations in 12 other countries, and Grameen Telecom Corporation (38%), a non-profit sister concern of the internationally acclaimed micro-credit pioneer Grameen Bank. Over the years, Grameenphone has always been a pioneer in introducing new products and services in the local market. GP was the first company to introduce GSM technology in Bangladesh when it launched its services in March 1997.

The technological know-how and managerial expertise of Telenor has been instrumental in setting up such an international standard mobile phone operation in Bangladesh. Being one of the pioneers in developing the GSM service in Europe, Telenor has also helped to transfer this knowledge to the local employees over the years. The company has so far invested more than BDT 10,700 crore (USD 1. 6 billion) to build the network infrastructure since its inception in 1997. It has invested over BDT 3,100 crore (USD 450 million) during the first three quarters of 2007 while BDT 2,100 crore (USD 310 million) was invested in 2006 alone.

Grameenphone is also one of the largest taxpayers in the country, having contributed nearly BDT 7000 crore in direct and indirect taxes to the Government Exchequer over the years. Of this amount, over BDT 2000 crore was paid in 2006 alone. HISTORY November 28, 1996: GrameenPhone was offered a cellular license in Bangladesh by the Ministry of Posts and Telecommunications. March 26, 1997: GrameenPhone launched its service on the Independence Day of Bangladesh; June 1998: GP started its services in the port city of Chittagong, the second largest city in the country.

Cell to cell coverage in the Dhaka-Chittagong corridor also enabled GP to introduce its service in a number of other districts along the way; September 1999: GP started its service in the industrial city of Khulna. Once again, a number of other districts came under coverage of GP because of the cell to cell coverage between Dhaka and Khulna. Earlier in September 1999, it introduced the EASY pre-paid service in the local market. It also introduced the Voice MailService (VMS) and the Short Message Service (SMS) and other Value Added Services (VAS);

June 2000: GrameenPhone started its services in Sylhet, Barisal and Rajshahi, bringing all six divisional headquarters under the coverage of its network. The service in Barisal region was started after the microwave link between Khulna and Chittagong was completed. August 2003: After six years of operation, GrameenPhone has more than one million subscribers; November 2005: GrameenPhone continues to being the largest mobile phone operator of Bangladesh with more than 5 million subscribers; November 16, 2006: After almost 10 years of operation, GrameenPhone has over 10 million subscribers.

September 20, 2007 Grameenphone announces 15 million subscribers. Since its inception in March 1997, Grameenphone has built the largest cellular network in the country with over 10,000 base stations in more than 5700 locations. Presently, nearly 98 percent of the country’s population is within the coverage area of the Grameenphone network. GP was also the first operator to introduce the pre-paid service in September 1999. In addition to core voice services, GrameenPhone offers a number of value-added services, in each case on both a contract and prepaid basis.

It established the first 24-hour Call Center, introduced value-added services such as VMS, SMS, Fax ; Data TransmissionServices, International Roaming Service, WAP, SMS – based Push-Pull Services, EDGE, personal ring back tone and many other products and services. GrameenPhone nearly doubled its subscriber base during the initial years while the growth was much faster during the later years. It ended the inaugural year with 18,000 customers, 30,000 by the end of 1998, 60,000 in 1999, 193,000 in 2000, 471,000 in 2001,775,000 in 2002, 1. 16 million in 2003, 2. 4 million in 2004 and it ended 2005 with 5. million customers. GrameenPhone offers the widest coverage in Bangladesh. The population coverage has increased from approximately 85% in 2005 to above 90% in 2006. In addition, GrameenPhone also offers GPRS in most of the country and EDGE in urban areas. From the very beginning, GrameenPhone placed emphasis on providing good after sales services. In recent years, the focus has been to provide after-sales within a short distance from where the customers live. There are now more than 600 GP Service Desks across the country covering nearly all sub-districts of 61 districts.

In addition, there are nine GP Customer Centers in all the divisional cities and they remain open from 8am-8pm every day including all holidays. GrameenPhone has generated direct and indirect employment for a large number of people over the years. The company presently has more than 4,500 full-time, part-time and contractual employees. Another 70,000 people are directly dependent on GrameenPhone for their livelihood, working for the GP dealers, retailers, scratch card outlets, suppliers, vendors, contractors and others.

In addition, the Village Phone Program, also started in 1997, provides a good income earning opportunity to more than 200,000 mostly women Village Phone operators living in rural areas. The Village Phone Program is a unique initiative to provide universal access to telecommunications service in remote, rural areas. Administered by Grameen Telecom Corporation, it enables rural people who normally cannot afford to own a telephone to avail the service while providing the Village Phone operators an opportunity to earn a living. The Village Phone initiative was given the . GSM in the Community.

Award at the Global GSM Congress held in Cannes, France in February 2000. GrameenPhone was also adjudged the Best Joint Venture Enterprise of the Year at the Bangladesh Business Awards in 2002. GrameenPhone considers its employees to be one of its most important assets. GP has an extensive employee benefit scheme in place including Gratuity, Provident Fund, Group Insurance, Family Health Insurance, Transportation Facility, Day Care Centre, Children’s Education Support, Higher Education Support for employees, In-House Medical Support and other initiatives. Mission Statement GrameenPhone Ltd. ims at providing reliable, widespread, convenient mobile and cost effective telephone services to the people in Bangladesh irrespective of where they live. Such services will also help Bangladesh keep pace with other countries including those in South Africa region and reduce her existing disparity in telecom services between urban and rural areas. Vision To be the leading provider of telecom services all over Bangladesh customers, shareholders and enthusiastic employees. SHAREHOLDERS ABOUT TELENOR AS Telenor AS is the leading Telecommunications Company of Norway listed in the Oslo and NASDAQ Stock Exchanges.

It owns 62% shares of GrameenPhone Ltd. Telenor A Shave played a pioneering role in development of cellular communications. It has substantial international operations in Mobile Telephony, Satellite Operations and Pay Television Services. In addition to Norway and Bangladesh, Telenor AS owns GSM companies in Denmark, Austria, Hungary, Russia, Ukraine, Montenegro, Thailand, Malaysia and Pakistan. ABOUT GRAMEEN TELECOM Grameen Telecom Corporation, which owns 38% of the shares of GrameenPhone Ltd. , is a not-for-profit company and works in close collaboration with Grameen Bank.

The internationally reputed bank for the poor has the most extensive rural banking network and expertise in micro finance. Grameen Telecom, with the help of Grameen Bank, administers the Village Phone Program, through which GrameenPhone provides its services to the fast growing rural customers. Grameen Telecom. s objectives are to provide easy access to GSM cellular services in rural Bangladesh, creating new opportunities for income generation through self-employment by providing villagers with access to modern information and communication based technologies.

PRODUCT AND SERVICES GrameenPhone offers a wide range of products and services based on the demand of the subscribers. Currently GrameenPhone is offering seven different products which are designed to fulfill the demand of the various customer segments. Moreover they frequently modify their product offerings and add more attractive features according tothe customer expectations. In this regard, GrameenPhone recently offered four brand new products named- Smile M2M, Smile PSTN, Xplore P1 and Xplore P2, to fulfill the changing expectation of the subscribers.

All the existing Easy Pre-Paid, Easy Gold, GPNational and GP Regular subscribers were automatically migrated to Smile M2M,Smile PSTN, Xplore P1 and Xplore P2 respectively. At present there are seven different GP products are available in the market. The whole product line of GrameenPhone is divided in to two broad categories. These are: Pre-Paid ; Post Paid. Among these two categories Pre-Paid products are more popular than the Post-Paid products. Currently in total 12,071,319 subscribers are using GrameenPhone. s Pre-Paid products and the rest of 576,462 subscribers are using the Post-Paid products.

GrameenPhone is the first company to offer Pre-Paid products in mobile phone. Pre-Paid products are particularly targeted to the rapidly growing middle class segment and largest young generation of the country. The charging policy of Pre-Paid products is . Pay as you go. ; which is subscriber have to recharge their account first and then they will be able to make call. They can also check their account balance immediately after finishing a call. In this way they can easily keep track of their account balances and control over the usage.

Moreover there is no monthly line rent involved which is another reason behind the popularity of Pre-Paid products. DIVISION AT GRAMEENPHONE GrameenPhone Ltd. has approximately 5000 employees working at different levels of organizational hierarchy. There are 9 functional departments engaged in managing these employees- with the aim to meet organizational objectives. GrameenPhone follows a mix of centralized and decentralized decision making process-where the top management mainly takes all the strategic decisions while the functional managers have flexibility to take decisions by themselves on a day to day basis.

At GrameenPhone the Managing Director is assisted by 9 Senior Executives who are heading different departments in the strategic decision making process. Thedepartmental names of GrameenPhone are given below: • Commercial Division • DMD. s (Deputy Managing Director) Division • Finance Division • New Business Division • Human Resource Division • Information Technology • Technical Division • Information • Regulatory ; Corporate Affairs GrameenPhone follows a 3-layer management philosophy in Bangladesh. These are Directors, Managers and Officers.

The CEO is the top most authority of all the levels. Directors are the departmental heads that are responsible for the activities of their departments. Managers have the authority next to directors. These two layers represent the management level of GrameenPhone. Officers are the next persons to stand in the hierarchy list. They are the typical mid-level employees of GrameenPhone. s organizational hierarchy. These officers are responsible for managing the operational activities and operating level employees. The Organogram: [pic] HUMAN RESOURCE DIVISION OF GRAMEENPHONE

Head of Function: Emad Ul Ameen Reporting To: Anders Jensen, Managing Director Main Objective Within the direction from the CEO of GrameenPhone, the Head of HR shall ensure that the HR function within GrameenPhone at all times is aligned with and supports the realization of GrameenPhone. s business objectives. The Head of HR shall optimize the human resources in GrameenPhone, through individual performance management and organizational development, as well as nurturing a culture supporting the realization of the vision and values.

In order to achieve this, leadership excellence is a key focus area for HR. The units in HR Division include: ? HR Operations; ? Recruitment ; Selection; ? HR Development; ? Health, Safety ; Environment ? Expatriate and Travel Support MAIN RESPONSIBILITIES Develop, maintain and implement company HR strategies, policies and procedures in order to establish organizational capabilities company-wide to meet current and emerging business needs, which include: ? Leadership ? Employee Capabilities ? Organizational Design ? Collaboration ? Recruitment ?

Compensation ; Benefits Employee relations and Health, Safety ; Working Environment Monitor and control company-wide HR activities;Provide support and consulting within scope, to all divisions in the company, in order to ensure coordination, business alignment and adaptation of best-practices;Develop and maintain descriptions of departments reporting to the Head of HR,defining their responsibilities and how work is organized between these departments; Ensure awareness of, and ability to comply with, legal requirements applicable for the function and its governance documents, including SOA-required internal controls and Codes of Conduct; Ensure necessary capabilities company wide to ensure that the organization is ableto meet its current and future business objectives. STRUCTURE OF HUMAN RESOURCE DEPARTMENT AT GP: Human Resources (HR) Department, an important of Administration Division plays very vital role in the total functioning of GP.

The traditional management functions – Planning, organizing, staffing, leading, controlling – all these are conducted by HR division. The informal structure of HR according to its functions can be classified into three main categories they are: • Human Resource Management (HRM) • Human Resource Development (HRD) • Human Resource management Information system (HR- MIS) HR MANAGEMENT FUNCTIONS OF GP: Manpower planning is an important function of HR management section. Two major activities in this function are: • Planning and forecasting the organizations short term and long term human resource requirements. • Analyzing the jobs in the organization and determining skills and abilities that are needed.

Manpower planning is a lengthy process involving several steps; it starts from need assessment and ends with recruitment. At first, all the departments after employee need analysis send their requirement to HRD through their respective divisions. After obtaining necessary approval from the management, HRD sets target, and prepare recruitment planning. According to job specification HR goes for recruitment. Recruitment process is as follows- • Give advertisement in the daily newspapers • Receive applications and file them, • Shortlist of the applicants • Fix date and time of a preliminary interview • Contact with the applicants and inform them about the interview over telephone or letter • Fix further date and time for final interview if it. s required and inform the interviewee accordingly • To interview applicants Grameen phone follows both traditional and modern approach.

They do job related questions and measure mental ability of applicants as verbal reasoning, numerical reasoning and spatial relations through aptitude test. • To prepare appointment letter for the finally selected interviewee • Give appointment to the person with a detail job description. Immediately after the recruitment separate employee file is opened comprising all the relevant information of the particular employee. This personal file is prepared, maintained and updated by HRD. In fact one of the main responsibilities of HRD is updating of all the personal file of the employee. Human resource development of GP:

Until 1999 GP has not any Training and development program. But after facing difficulties and uncertainties and for continuous improvement in performance GP introduced training and development program in 2000 under human resource development. An organization’s performance and resulting productivity are directly proportional to the quantity and quality of its human resources. While employee performance must be evaluated in economic terms of efficiency and effectiveness, it can be best achieved through recognizing and enhancing the human dignity of each employee. The quality of the human resources can be effectively increased through education, training, and personal development.

Human Resources Development functions aim to increase the quality of the human resources especially through training. GP training involves the following steps- • Assessing training needs • Selection of the participants • Conduct training programs. Different training programs of GP GP Provides both local and overseas training on the basis of the need analysis. Local training: Local training can be both-Inside GP and Outside GP. Induction/Orientation training Program falls under inside GP training category. After joining, it is the responsibility of the HR to conduct induction/orientation training to the newly recruited personnel to provide a general introduction of the company.

To prepare training plan, participant’s list, and training schedule for induction training – HR department does all. Inside GP training will cover Management training. It will cover Department training in near future. Out side GP training means to take part in training programs offered by different training institutions/universities on different subjects. Overseas training After need assessment employees who need overseas training are sent abroad for overseas training. Expenses of overseas training are generally borne by GP. The particular employee who has been selected for training has to sign a surety bond for specific period of time for overseas training.

Besides the above mentioned works, some routine functions of HRD are- • Prepare, maintain and update training related database. • Prepare career development plan • Prepare induction training manual/modules • Evaluate training program • Make agreement between GP & employees for overseas training • To communicate with different local training institutions • To communicate with trainers/instructors. [pic] CORE COMPETENCY OF GP THE PEOPLE The people of GrameenPhone are young, dedicated and energetic. All employees are well educated at home or abroad, with an even distribution of males and females and social groups in Bangladesh. They know in their hearts that GrameenPhone is more than phones.

This sense of purpose gives them the dedication and the drive, producing the biggest coverage and subscriber-base in the country. GrameenPhone provides equal employment opportunities and recognizes the talents and energy of its employees. THE SERVICE GrameenPhone believes in service that leads to good business development. Telephony helps people work together, raising their productivity. This gain in productivity is development, which in turn enables them to afford a telephone service, generating good business. Thus development and business go together. THE TECHNOLOGY

GrameenPhone. s Global System for Mobile or GSM technology is the most widely accepted digital system in the world, currently used by over a billion eople in 172 countries. GSM brings the most advanced developments in cellular technology at a reasonable cost by spurring severe competition among manufacturers and driving down the cost of equipment. Thus, consumers get the best for the least. GrameenPhone is now the leading telecommunications service provider in the country with more than 10 million subscribers as of January 2007. Presently, there about 15 million telephone users in the country, of which, a little over one million are fixedphone users and the rest mobile phone subscribers. Starting its operations on March 26, 1997, the Independence Day of Bangladesh, GrameenPhone has come a long way.

It is a joint venture enterprise between Telenor AS (62%), the largest telecommunications service provider in Norway with mobile phone operations in 12 other countries, and Grameen Telecom Corporation (38%), a non-profit sister concern of the internationally acclaimed micro-credit pioneer Grameen Bank. Over the years, GrameenPhone has always been a pioneer in introducing new products and services in the local market. GP was the first company to introduce GSM technology in Bangladesh when it launched its services in March 1997. The technological know-how and managerial expertise of Telenor AS has been instrumental in setting up such an international standard mobile phone operation in Bangladesh.

Being one of the pioneers in developing the GSM service in Europe, Telenor AS has also helped to transfer this knowledge to the local employees over the years. 8. 5 GRAMEENPHONE CORPORATE GOVERNANCE In the fast-paced world of telecommunications, vibrant and dynamic Corporate Governance practices are an essential ingredient to success. GrameenPhone believes in the continued improvement of Corporate Governance. This in turn has led the company to commit considerable resources and implement internationally accepted Corporate Standards in its day-to-day operations. Being a private limited company, the Board of Directors of GrameenPhone have a pivotal role to play in meeting all stakeholders. interests.

The Board of Directors and the Management Team of GrameenPhone are committed to maintaining effective Corporate Governance through a culture of Accountability, Transparency, Well- Understood Policies and Procedures. The Board of Directors and the Management Team also persevere to maintain compliance of all laws of Bangladesh and all internally documented regulations, policies and procedures. GrameenPhone is a truly transparent company that operates at the highest levels of integrity and accountability on a global standard. CORPORATE SOCIAL RESPONSIBILITY; AN INTEGRAL PART OF GP GrameenPhone started its journey 10 years back with a believe that- . Good development is good business..

Since its inception, GrameenPhone has been driven to be inspiring and leading by example, when it comes to being involved in the community. GrameenPhone believe that, sustainable development can only be achieved through long term economic growth. Therefore, as a leading corporate house in Bangladesh GP intend to deliver the best to their customers, business partners, stakeholders, employees and society at large by being a partner in development. GrameenPhone defines Corporate Social Responsibility as a complimentary combination of ethical and responsible corporate behavior as well as a commitment towards generating greater good in society as a whole by addressing the development needs of the country.

To interact effectively and responsibly with the society and to contribute to the socioeconomic development of Bangladesh, GrameenPhone has adopted a holistic approach to Corporate Social Responsibility, i. e. Strategic & Tactical. Through this approach GP aims to, on the one hand involve itself with the larger section of the society and to address diverse segments of the stakeholder demography, and on the other remain focused in its social investment to generate greater impact for the society. GrameenPhone focuses its Corporate Social Responsibility involvement in three main areas – Health, Education and Empowerment.

They aim to combine all their CSR initiatives under these three core areas to enhance the economic and social growth of Bangladesh. Health Helping and caring for the community is an essential component of GrameenPhone. Corporate Social Responsibility; therefore they endeavor to make a positive contribution to the underprivileged community of Bangladesh by helping in improvement of the health perils in the country as much as possible. Healthcare is still inaccessible for many Bangladeshis. Almost half of the country’s population live below the poverty line and cannot even afford basic healthcare. Only 35% of the rural population use adequate sanitation facilities and 72% have access to clean drinking water. Moreover the people of the flood-prone areas suffer from many waterborne diseases. The major problem in this sector is the significant gap between healthcare knowledge and practice and availability of the healthcare services.

Therefore, all possible sources, be it public or private, should mobilize their efforts to make healthcare services available to the people who need it most, and thus help in achieving the MDG goals. GP. s plan is to engage in programs, especially in the rural areas, that will assist in creating awareness about healthcare and healthcare services and help improve the overall quality of life. Keeping their vision in mind – We are here to help; GrameenPhone aim to extend their contribution to the development of the healthcare system and work to provide a brighter and healthier future for the people of Bangladesh. Education Education is the key to prosperity and good life. Every human being should have the opportunity to make a better life for him or herself.

One of the Millennium Development Goals (MDG) for Bangladesh is to achieve universal primary education; unfortunately too many children in Bangladesh today grow up without this opportunity, because they are denied their basic right to even attend primary school. The country. s low literacy rate of 41% (2004 UNESCO Report), may indicate that we are far away in pursuit of sustainable development, but at the same time the gradual increase in the adult literacy rate gives us the hope that our nation has the potential to improve in this sector. The marginalized and disadvantaged groups in general – particularly the rural and urban-poor of Bangladesh – have significantly less access to education than other groups.

Though initial enrollment in primary school is high, the completion rate is notably low; approximately 65% (World Bank Report 2004) and a smaller percent of that even complete secondary school. Bangladesh government has provided lot of incentives, such as, free distribution of textbooks in primary schools, secondary stipend program for 100% of the girls, Food for Education project, to encourage and improve the educational sector of the country, which has helped in improvement in the literacy rate. But still we have a long way to go to make our country illiteracy free, thus GP look forward to support this sector, which will eventually help to build a developed country.

Providing access to education, especially for children from disadvantaged backgrounds who might not otherwise get the opportunity, is the main goal of GrameenPhone. CSR education initiatives. Many people in Bangladesh still lack the basic technological knowledge and marketable skills, thus GP plan to focus further to develop an educated and skilled workforce through creating opportunity in capacity development; skilled workforce would in turn be able to create and share knowledge and contribute to the economy of Bangladesh. MOBINDIRECTOR, PROJECTS LEADERSHIP STYLE & EXPECTATION IN GRAMEENPHONE In my view, the management of GrameenPhone can be termed as supportive in the sense that the top management deliberately supports the suggestions, values, ideas, innovation and hard work of the employees and officers.

On the other hand, the management style can also be termed as Collegial as high amounts of team work and participation exists between the top and bottom parts of GrameenPhone. Thus, in my view, management style of GrameenPhone falls somewhere between supportive and collegial. THE PRINCIPLES OF REWARD MANAGEMENT AND GP: Fair A fair reward system is one in which people are treated justly in accordance with what is due to them – their value to the organization. Fairness means that reward management processes operate in accordance with the principles of distributive and Procedural justice. In Gp, people believe that they are treated justly in accordance with their value added to their services. Equity Equity is achieved when people are rewarded appropriately in relation to others within the organization.

Equitable reward processes ensure that relativities between jobs are measured as objectively as possible and that equal pay is provided for work of equal value . At, GP the similar grade employees get same base salary and frings benefit. In corporate sales department, employees are paid according to their performance . But, this payment system has been made tough by providing more critical target. Consistent A consistent approach to the provision of rewards means that decisions on pay should not vary arbitrarily and without due cause between different people or at different times. They should not deviate irrationally from what would be generally regarded as fair and equitable. At, GP the pay system is fairly consistent .

The payment is fairly and equitably increased in accordance with the experience and the performance level. Transparent Transparency means that people understand how reward processes operate and how they are affected by them. At, GP the reasons for pay decisions are explained to them at the time they are made. Employees have a voice in the development of reward policies and practices and have the right to be given explanations of decisions and to comment on how they are made. COMPONENENTS OF REWARD MANAGEMENT AND ITS APPLICATION IN GRAMEENPHONE: BASE OR BASIC PAY: As most of the employees of GP are white collar worker, so most of them are entitled to a base salary structure.

The workforce of GP is divided into three portion:1. part-timer. 2. contractual and 3. permanentr. Both. permanent and contractual workers have fixed base salary. But, part timers doesn’t entitled to any type of fixed base salary. In an annual survey comparing 10 competitors and similar companies in other industries, Grameenphone identifies the wage distribution and bases its own wage levels on those in the upper quartile. This yields a minimum monthly salary of 28000 BDT (408 USD). The national average income for earners in non-agricultural sectors is 6000 BDT (Bangladesh Bureau of Statistics 2005) which is much less than the gp average salary base. VARIABLE PAY SYSTEM:

Most of the part-timers specially working at the call centers are entitled to contingent pay system. These part-timers are paid on per hour basis. For example: a customer manager gets 80-100 tk. on per hour basis. INCENTIVE PAY SYSTEM: Most department are covered with performance based pay system in addition with base pay. In corporate sales department employees paid bonuses on accomplishment of sales target. Other departments like CIC, they are given KPI (key performance indicator) which is similar to target. Among these KPI two are organization wide target and others are individual target. On, accomplishment of this KPI, employees get bonuses. Based on this employees also achieve yearly salary increase. COMPETENCY-BASED PAY Where the company pays for the employee’s range, depth, and types of skills and knowledge, rather than for the job title he or she holds.

• Competencies: Demonstrable characteristics of a person, including knowledge, skills, and behaviors, that enable performance. Usually, GP provides bonus to the employees at the end of month or year or after the completion of a project based on the level of difficulty faced while performing his/her job by utilizing proper knowledge, skill and ability. EMPLOYEE BENEFITS Transportation allowance: In addition with basic salary employees are paid transportation allowance. Some of the departments employees’ are provided with bus and other transportation services. House-rent allowance:

All the permanent and contractual employees are entitled to house-rent allowance. Health and Medical Insurance The executive and administrative employees are entitled for medical allowance. All employees are entitled and covered by health and medical insurance. This also applies to family members. This coverage has also been known to apply to out-sourced. An example of this is that several drivers hurt in traffic accidents have been sent to Thailand and Singapore for medical treatment. Working conditions allowances Working conditions allowances may be paid where the work is unpleasant or if the work is haphazard type. Education grants for children:

As a part of the employee policy, Grameenphone is also providing monthly education grants to children of all employees’ until the age of 21. This grant is a fixed monthly sum for each child. Furthermore, these children can also apply for financial support to attend university. Formation of pension fund: In compliance with the local legislation Grameenphone is building a pension fund for its employees. Provident fund: In addition to the required minimum level, Grameenphone also invests in provident funds1. 10 % of the employees’ salary is paid on a monthly basis into the fund. Participation in the fund is voluntary. Following five years of employment, the company invests, in addition to the 10% provided by the employee, the same amount into the fund for each individual.

All regular employees are also entitled to a gratuity payment paid at the end of his/her service with the company and this is calculated based on the length of service. Standards for Health, Safety and Environment (HSE) Grameenphone has issued a manual for HSE work within the company . The manual offers a comprehensive outline of the responsibilities and duties of Grameenphone and that of the individual employee. An important aspect of this is the medical consultancy and regular check-ups provided for Grameenphone employees in collaboration with authorized medical centers. Scholorship for employees: Grameenphone also offers 100 scholarships to employees who want to take an Executive Master of Business and Administration (EMBA) and covers 75% of the tuition fees.

This programme is part time. The need for training is related to the job of each individual employee and mainly identified through the annual compulsory appraisal dialogue. Reward system of GP: Reward systems contain all the elements of reward, namely: • Policies, which provide guidelines on approaches to managing rewards; • Practices, which provide rewards including contingent pay; • Processes, which are concerned with evaluating the relative size of jobs (job evaluation) and assessing individual performance (performance management); • Procedures, which maintain the system; • Structures, which provide the framework for pay (grades or pay spines).

To formulate and control the elements of reward management GP need to do the following activities: JOB ANALYSIS: At GP job analysis is an integral part of salary structure formation and job evaluation. Analyzing the jobs in the organization, determining skills and abilities that are needed and based on the skill level GP set up pay grade for different posts. JOB EVALUATION: Job evaluation is a systematic process for defining the relative worth or size of jobs within an organization in order to establish internal relativities and provide the basis for designing an equitable grade structure, grading jobs in the structure and managing relativities.

It is based on the analysis of jobs or roles which leads to the production of job descriptions or role profiles. GP has already done the job evaluation task for its’ different post. MARKET RATE ANALYSIS: GP is the pioneer in the telecom industry. They have set up their pay structure based on the socio economic situation in Bangladesh.. At the beginning of their operation they have also evaluated the overall industry’s pay structure though there was not enough company then in the industry. So, they have taken information regarding pay structure of telecom industry of our neighboring countries. They have also analyzed the demand and supply of the skills and knowledge of the local and foreign human resources of telecom industry. GRADES AND PAY STRUCTURE:

GP has divided the pay grade according to the succession level. The permanent employees have different pay structure . On the other hand contractual have different pay structure. PERFORMANCE MANAGEMENT OF GP: Performance management is another main function of HR Management. It is also important to formulate and control an equitable compensation system, Performance appraisal is any personnel decision that influences the status of the employee regarding his confirmation, increment, promotion, and transfer. GP performance appraisal takes place in two stages- • On completion of probation • On completion of one year of service.

Performance of an employee takes place by following some steps- a) Job analysis ) Set up performance standard and c) Appraisal interview which is part of appraisal board tasks. Every year GP use performance appraisal board to evaluate the performance of each and every employee. The board set up six stage or grade for employees to accomplish. The sixth grade is the outstanding performance. On accomplishment or reaching of the sixth grade the employee gets 26% increment . On attainment of fifth stage employee achieve 22-23% increase in total compensation. the attainment of first level results in 10-12 % increase which is applicable for all permanent and contractual employees irrespective of whether they have attained the first stage or not.

MANAGEMENT INFORMATION SYSTEM: Through the management information system Grameen phone provide information to the respective employees to asses adequately how the company is doing and ensure that necessary raw data is gathered and processed into usable information and also ensure that appropriate individuals receive the information at the proper time so that it can be used. It is also used to update the experience level of different employee and their compensation package. HR-MIS Functions involve- • To maintain & update employee salary and compensation package. • For, part –timers the number of hours worked and calculation of salary based on the hours worked.

Experience level of all the employees. • Leave management Leave management is an important function of MIS department. It has opened a leave management database to obtain current leave status of all the employees of Grameen Phone. It provides employees about their leave status when it is necessary. Maintain employee leave related different statistics such as the number of days of paid sick leave or vacation. COMPUTERIZED JOB EVALUATIONS GP use a computerized system that uses a structured questionnaire and statistical models to streamline the job evaluation process. Online test is the only technique that GP uses to evaluate the job of employees in a computerized way.

In this test, they usually conduct a survey that consists of several questions asked to the employees according to different level of jobs and finally, management evaluate the job based on the answers provided by the employees about his/her performance, duties and responsibilities. HR POLICY AND PRACTICE Grameenphone seems to be a pioneer in the field of human resource management, employee care and competence development in Bangladesh. Grameenphone is currently employing approximately 5000 people of which 84 % is under 31 years old. The employees are spread out in six office zones throughout the country, with Dhaka being the largest with 3561 employees. Most of the staff has university backgrounds within fields such as management, marketing, economics, finance and engineering. [pic] http://www. telecommons. com/villagephone/gpar98. pdf In 1997 the number of expatriates working in the company was close to 90.

Today however, there are only five foreigners employed on a regular basis, and another five on time-limited contracts. The government demands that a ratio of 1:20, expatriates to locals be kept. The figures are therefore not only within the government requirement, but significantly so. The situation is supposedly a lot different in many of Grameenphone’s competitor companies. The turnover rate in 2006 was 8%, and a preliminary 4% so far for 2007. The number of resignations peaked in 2005 when new operators penetrated the market and offered higher salaries to Grameenphone employees, but this was still relatively low. From this argue that low turnover rates are a good indicator of a healthy work environment. LITERATURE: DEFINITION OF REWARD MANAGEMENT:

Reward management is concerned with the formulation and implementation of strategies and policies the purposes of which are to reward people fairly, equitably and consistently in accordance with their value to the organization and to help the organization to achieve its strategic goals. It deals with the design, implementation and maintenance of reward systems (reward processes, practices and procedures) which aim to meet the needs of both the organization and its stakeholders. THE AIMS OF REWARD MANAGEMENT The aims of reward management are to: • reward people according to what the organization values and wants to pay for; • reward people for the value they create; • reward the right things to convey the right message about what is important in terms of outcomes and behaviors; • develop a performance culture; motivate people and obtain their commitment and engagement;

• help to attract and retain the high quality people the organization needs; • create total reward processes which recognize the importance of both financial and non-financial rewards; • develop a positive employment relationship and psychological contract; • align reward practices with both business goals and employee values; • Operate in ways which are fair, equitable, consistent and transparent. REWARD MANAGEMENT COMPONENTS: Base or basic pay Contingent pay Contingent pay Employee benefits Non-financial rewards Market rate analysis Performance management: Elements of reward management: Policies, which provide guidelines on approaches to managing rewards;

• Practices, which provide rewards including contingent pay; • Processes, which are concerned with evaluating the relative size of jobs (job evaluation) and assessing individual performance (performance management); • Procedures, which maintain the system; Structures, which provide the framework for pay (grades or pay spines). Recommendation Job Evaluation Process: There is lack of reliability in their job evaluation process . The job evaluation process is not efficient enough to provide perfect weight, salary and value for a specific job. job evaluation process used by GP doesn’t collect sufficient information to make the job evaluation process effective. So,Grameen phone should focus more on efficiency of job evaluation process. There job analysis should be more clearly defined. Job evaluation system should be more informative and should use more reliable method.

GP should conduct effective and efficient job evaluation process in order to find out the gap between expected and actual employee performance, which will initiate the company to go for required T&D program. Once the employees are provided appropriate training and development program, the performance level would most likely go up to the extreme level and finally, the gap will be reduced. Most importantly, the high performance will benefit both the employer and employees. In case of employer, they will get high-performing and highly-skilled employees, whereas, employees will be benefited by achieving high competence and will be rewarded as a part of recognition. Lack of reliability • Lack of validity • Evaluate people mostly not the job Compensation Policy: They only follow only Maslow’s Hierarchy .

They doesn’t follow equity theory and expectancy theory. There is lack of equity at various level of the salary structure. Because of inefficiency and misalignment in business philosophy and compensation policy of the company, GP isn’t being capable of maintaining a proper and fair compensation policy within the organization. In other words, this inefficiency has already led dissatisfaction among the employees, which resulted into the switch off the job from GP to other companies. Stock Option • Transfer of core competence (employees of GP) • Loyalty and motivation These are the problems that the company is already going through and will seriously cause harm to the reputation and image of GP.

In case of transfer of core competence, we can say that, since GP is not following the most effective compensation policies to retain its employees, this resulted into disloyalty as well as unproductive outcome given by employees. For example, the stock option could be an effective option for the employee retention. Unfortunately, GP is still out of market by not offering stocks to the public. If they adopt this policy, this would benefit them by increasing more cash balance as well as offering stock options to the employees. As a result, the employees would feel more dedicated to give effort for the productivity of the company up to their utmost level. Therefore, the company should go for this policy to reduce the loss of core competence as well as the earning of the company in the competitive market. D. ARIF AL ISLAMRECTOR, FINANCE

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