ANALYSIS OF COMPENSATION MANAGEMENT IN MUTHOOT CAPITAL SERVICES LTD.

INTRODUCTION:
Compensation Something (such as money) given or received as payment for a service Human Resource is the most vital resource for any organization. It is responsible for each and every decision taken, each and every work done and each and every result. Employees should be managed properly and motivated by providing best remuneration and compensation as per the industry standards. The lucrative compensation will also serve the need for attracting and retaining the best employees. Compensation is the remuneration received by an employee in return for his/her contribution to the organization. It is an organized practice that involves balancing the workemployee relation by providing monetary and non-monetary benefits to employees. Compensation is an integral part of human resource management which helps in motivating the employees and improving organizational effectiveness. Compensation is a key factor in attracting and keeping the best employees and ensuring that your organization has the competitive edge in an increasingly competitive world.

NEED OF COMPENSATION MANAGEMENT A good compensation package is important to motivate the employees to increase the organizational productivity. Unless compensation is provided no one will come and work for the organization. Thus, compensation helps in running an organization effectively and accomplishing its goals. Salary is just a part of the compensation system, the employees have other psychological and self-actualization needs to fulfill. Thus, compensation serves the purpose. The most competitive compensation will help the organization to attract and sustain the best talent. The compensation package should be as per industry standards.

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COMPANY PROFILE:
Muthoot Capital Services Ltd. promoted by the Muthoot Pappachan Group is a Non Banking Finance Company (NBFC) registered with the Reserve Bank of India and listed on the Bombay Stock Exchange. Established in 1994, Muthoot Capital Services Ltd offers fund and non fund based financial services to retail, corporate and institutional customers through the wide network of branches of Muthoot Fincorp Ltd. Its portfolio includes commercial and consumer finance products like vehicle loans, gold loans, loans against property, bonds, deposits, investment products and advisory services among others. Apart from these, the company also disburses loans against property, shares, gold ETFs, SME loans, mortgage loans, leasing & hire purchase loans and bill discounting. The Muthoot Pappachan Group, a Rs 20,000 crore, is a professionally managed enterprise that has financial services as its core activity with a significant presence in other businesses such as hospitality, infrastructure, automotive and renewable energy. To augment its fund base, MCSL came out with a public issue in February 1995. The issue was oversubscribed by 8.5 times -- at a time when the Indian capital market was sluggish. Almost the entire subscription was received from the state of Kerala. MSCL has also diversified into fund and non-fund based activities laying equal emphasis on the corporate and non-corporate sectors of Kerala. Promoted by the Muthoot Pappachan Group, MCSL has today emerged as one of the leading financial institutions in the capital market operations, with its foundations dating back to the year 1939, with a stronghold in the banking and finance sector especially in the rural and semi-urban areas in South India. Over the last decade, MCSL has established itself as the clear service leader in the capital market. The MCSL team comprises seasoned business professionals and we have recruited management and support staff with years of experience in the relevant disciplines and markets in order to provide our customers with informed, competent and responsive service and advice. MCSL leverages the extensive branch network of the Muthoot Pappachan Group to deliver financial services and products to several locations in Kerala, Tamil Nadu, Karnataka, Maharashtra, Gujarat, Goa and Andhra Pradesh. MCSL is listed on the Bombay Stock Exchange with revenue of INR 670 Mio and a profit of INR 155 Mio for FY 2011-12.

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Key Events and Milestones YEAR

1994 1995 1998 2002 2007 2007 2009

EVENTS
Incorporation Initial Public Offering & Started Auto loan Business Category A Deposit accepting NBFC License was obtained Started disbursing loans based on Demand Promissory Notes License from IRDA to act as a Corporate Agent was obtained Entered into agreement with HDFC Standard Life Insurance Company Limited to act as Corporate Agent Entered into agreement with Birla SunLife Insurance Company Limited for Data Sharing

VISION of MCSL : He (Muthoot Pappachan Founder Chairman) envisioned a world of prosperity and happiness for all. He dreamt of financial freedom for all. We are committed to transform his dreams into reality by empowering the poorest of poor, with financial freedom and confidence. Board of Directors Mr. Thomas John Muthoot - Chairman Mr. Thomas George Muthoot - Managing Director Mr. Thomas Muthoot - Director Mr. A. P. Kurian - Director Mr. Philip Thomas - Director Mr. R. K. Nair - Director Chief Executive Officer: Mr. R. Manomohanan

PRODUCTS & SERVICES: Three Wheeler Loan

Drive home your dream in just 24 hours. Our flexible repayment options, easy installments and hassle free documentation make us your banker of choice.

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Salient features : 1. 2. 3. 4. 5. Flexible repayment options, ranging from 12 to 36 months. Attractive interest rates. Loan approvals in 24 Hrs Repayment through any of Muthoot Fincorp branches across the country. Installment can be paid daily/weekly/fortnightly/monthly according to the customer's convenience 6. Hassle free loans - no post dated cheques required 7. Easy and simple documentation. 8. Special schemes to suit your needs.

Two Wheeler Loan

Owning a two wheeler has never been this easy. Our two wheeler loans provide 90% of the on-road price of the vehicle, simple interest rates and easy EMI's. You can pay at your own time bound manner at any of the Muthoot Fincorp branches across the country. Salient features 1. 2. 3. 4. 5. Flexible repayment options, ranging from 12 to 36 months. Attractive interest rates. Loan approvals in 30 minutes Repayment through any of Muthoot Fincorp branches across the country. Installment can be paid daily/weekly/fortnightly/monthly according to the customer's convenience 6. Hassle free loans - no post dated cheques required 7. Easy and simple documentation. 8. Spot approval for Muthoot Pappachan Group debenture holders. 9. Special schemes to suit your needs. 10. Spot approval for Honda / Hero Honda models. 11. No income proof based programs also available

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SCOPE OF THE STUDY:

In todays world organizations tries more to assess the worth of an individual in terms of his performance and contribution to the organizations. With the growing demand of workforce and constant challenges in the business environment, organizations have to evolve and accurate system for evaluating jobs and assessing their worth. Compensation management helps to determine the relative worth of a job in an organization in a systematic, consistent and accurate manner. It also helps in estimating the basic pay for each job in accordance with the importance of the job in the organizational hierarchy .once a basic pay is determined, the rewards, incentives and benefits attached worth the pay, positions and performance are also determined . The basic wage, incentives and rewards and benefits, together form the compensation package of an employee. OBJECTIVE: To analyze the payroll structure of employees. ( PRIMARY) To analyze the Job profile and study the job description. To analyze performance level of employee. To analyze employee satisfactions.

LIMITATIONS OF THE STUDY: Majority of the employees mainly counter sales executives, tele-callers etc. are posted in various hubs in different states. So its difficult for me to access their response regarding the pay structure provided to them

RESEARCH METHODOLOGY:
The study proposes to conduct a descriptive research on compensation management. DATA COLLECTION: The study will be based on both primary and secondary data. Secondary data contains datas from various journals and web resources about compensation. Primary data contains datas from employees at all level in an organization. SAMPLE FRAME: Employees of Muthoot Capital Services shall be the sample frame for the study SAMPLIING TECHNIQUE: Simple random sampling technique is used for collecting the data. 30% of the employees are selected for the study.
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STUDY SO FAR:
For last 3 weeks, I have been studying about the company and what it does. For this I have been personally meeting the head and other employees in each section Credit, Sales, Collections, Accounts/Finance, Operations and Top Level Management ( mainly HR Dept.) respectively. I figured out the job descriptions of each level of employee and understood the factors that affects their performance Learned the Hierarchy in each of the above mentioned departments. Different levels of employees- Trainees, Probationers and Permanent. Also studying the performance appraisal process of the employees in the company.

Now started studying the components of the payroll structure of MCSL employees. They are as follows: Basic HRA CCA CA Other allowances Telephone and Petrol Variable Pay Incentives- purely performance based Deductions PF, ESI, WWF, Professional Tax, TDS.

FUTURE: What to be done?

To study in detail how the payroll structure is prepared for the employees by coordinating with the HR team. To prepare a questionnaire for the analysis of employee satisfaction level. For further knowledge, the processes involved in performance appraisal of an employee.

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