Question# 01: What factors prevented state electricity boards (SEBs) from fulfilling the

electricity needs of the country?

Answer: Although State Electricity Board (SEB) achieved Impressive result in power generation,
they could not fulfill the electricity needs of the country. Some of the major reasons behind this
were:
1. Lack of commercial orientation & conflicting objectives,
2. High transmission & distribution losses,
3. Unmanageable size & monolithic structure,
4. Unrealistic pricing policy resulting in a skewed tariff structure
5. Poor billing & collection,
6. Bad quality of service due to want of repair & maintenance activities & lack of spares,
7. Manpower related problems like over staffing, low skill levels & lack of training
8. Low motivational levels coupled with low accountability
9. & not but the least, misuse of statutory power of the state government

Question# 02: What did the power sector reforms that started December 1991 seek to achieve?
Answer: In December 1991, the state chief ministers adopted a new national economic policy
after several rounds of discussion. It incorporated power sector reform to achieve below
agendas:

 Reduce reliance on government & raise resource from private sources for generation,
transmission & distribution
 Make power available at a reasonable cost
 Ensure stable & good quality power supply, and
 Supply power on demand

Question# 03: Evaluate the status and role of HRM in OSEB before privatization. In what ways
did it change after GRIDCO came into existence?

Answer: Human Resource Management in OSEB was below expectation before the privatization.
HRD was fail to operate its functional job successfully as none was not emphasized on HR as
independent body. Only on section of the HRD wing was functioning that time, i.e. the
establishment wing. Professional managers were not in charges of the HR activities as because
of it was mostly interfered by the Government of Orissa.
Training is an integral part of any organization. Training was not thought of as an important tool
of HRM in OSEB. It was perceived as a cost rather than an investment. In fact, there was only one
officer who did not have much time to spend on training and development activities. The
industrial relations eliminate in OSEB was more antagonistic than supportive.
After GRIDCO came into existence, it set HR as autonomous body & empowered with HR policies
that actually need to be considered. After this transformation HRM emphasized on various
reform related task favoring GRIDCO including surplus human resources & creating skillful human
resources as well.

Question# 04: What was the HR effect of privatization on human resource in GRIDCO?

Answer: The process of structural reforms in the power sector finished with the privatization of
GRIDCO’s distribution business. Thus, the main impact on human resource appears to be
qualitative. The employees have been, after privatization, pushed into developing a business-
like attitude in a competitive world. As the managing director says, “Everyone seem to think this
is to be charitable organization. I want to change it.”

Question# 05: What does the case suggest about the interaction between strategic planning &
HRP?

Answer: Strategic planning & Human Resource Planning interrelated in every organization. As
human resource planning is one of the integrated part of strategic planning. As per the case we
have reviewed here, strategic planning & HRP should be taken care of from the beginning. But
when the reform process started in OSEB, it was found that, HRP was not in existence properly,
whereas strategic planning was also vulnerable due to different issues. Surplus employees were
found during reform process as well as strategic planning was not existing which could ensure
healthy balanced HR asset in OSEB. After the privatization, with the reinforced strategic planning,
GRIDCO established healthy & skillful HR which is definitely not possible without successful
strategic planning.

Question# 06: Critically evaluate the VRS of GRIDCO for managing employee surplus. Given the
culture of the firm, what optional strategies would you suggest to GRIDCO for managing surplus
employee?
Answer: Absence of any human resource planning, proper recruitment policy, lack of effective
administration of temporary workforce and vested interests of certain groups created a large
contingent of surplus workforce affecting the performance of the erst-while OSEB, After the
restructuring program, GRIDCO introduced an early voluntary retirement scheme (EVRS) in
August 1997. Although reduction of employees was the main objective, separation by way of
termination under the present legal framework is a difficult proposition. The employees could
have been redeployed in other organizations, but in a not so developing economy, in which
surplus workforce was common, there were no takers. So, the only manner in which employees’
separation was possible, was by adopting an VRS. The objective of the VRS were to:

 Provide employees of the company an opportunity to seek early retirement with

commensurate monetary benefits,
 Utilize the workforce optimally,
 Rationalize the workforce in the light of the age and skills mix required, and thereby
increase productivity.

Additionally, the surplus employees can be in cop with the various projects of GRIDCO, as they
did have the know how knowledge in power generation company in various department, which
could be ensure by providing different trainings as they were not lightened with the training
requirement from the beginning of OSEB.

Question# 07: The strategy for managing the surplus employees of a firm that is going through
a major transition such as privatization makes the difference between success & failure.
Comment in the light of the case.

Answer: The strategy for managing the surplus employees of a firm that is going through a major
transition such as privatization makes the difference between success & failure. In accordance
with the subject case study, we have found that, how GRIDCO became successful managing the
surplus employee of former OSEB. In first reform process, they have identified the number of
surplus employees by proper HRP. In later, they have prepared relevant study & taken measures
like volunteer retirement scheme with attractive benefits. They have also realized that, there
were experienced technical employees who could be helpful for the organization & realizing the
essence they organized training for the employees & disseminated them into different sectors.
Here the privatization makes the actual difference as because of it would not be possible if the
situation goes for further more as previous like OSEB owned the authorities. Therefor in the light
of the case it has found privatization makes the difference between success & failure.