HUL Case

(Meeting Employee Expectations)

Group Members:
Abhinav joshi
Anurag Siddharth
Ashish Kumar Maharaj
Harsh Soni
Sachin Patel



Table of Contents
1. Case Brief .................................................................................................................................................. 3
2. Indian Industrial Context ........................................................................................................................... 3
Indian FMCG Industry ............................................................................................................................... 3
3. HUL: Company Profile ............................................................................................................................... 4
Brands ....................................................................................................................................................... 4
4. Employee Welfare at HUL ......................................................................................................................... 4
5. Key Challenges .......................................................................................................................................... 4
Competition .............................................................................................................................................. 4
Fall in Dream Employer List ...................................................................................................................... 5
Postings ..................................................................................................................................................... 5
Career Path ............................................................................................................................................... 5
6. Key Questions Posed ................................................................................................................................. 5
7. Proposed Solutions ................................................................................................................................... 5
Provide a Positive Working Environment ................................................................................................. 5
Clear Communication ............................................................................................................................... 6
Gauge Employee Pulse .............................................................................................................................. 6
Involve and Engage ................................................................................................................................... 6
Develop skills and potential ...................................................................................................................... 6
Measure Progress ..................................................................................................................................... 7





1. Case Brief
The case examines the changing employee expectations at Hindustan Unilever Ltd., a market
leader in the Indian Fast Moving Consumer Goods (FMCG) sector and the Indian subsidiary of
the global FMCG major, Unilever. HUL had been known as the dream employer and a
leadership factory of corporate India. The case traces the evolution of the company. It studies
the challenges that HUL faced in the last decade with respect to the changing employee
expectations, and the need for modifying the traditional employment model at HUL. It delves
into the changes in people practices that the company had undertaken during the first decade of
the 21
st
century in order to remain an organization that continued to create leadership at all
levels, and continued to remain relevant to a younger generation of employees, thereby retaining
its eight-decade long legacy as the CEO Factory of India.
2. Indian Industrial Context
At the end of the first decade of the twenty-first century, the growth rate of India rose to 9 per
cent, one of the fastest growing economies of the world. While the share of the agricultural
sector in real gross domestic product (GDP) at 199394 prices declined from 55.5 per cent in the
1950s to 28.7 per cent in the 1990s, the share of the manufacturing and services had increased
from 16 per cent to 27 per cent and from 28 per cent to 44 per cent.
According to a McKinsey Report, if Indias manufacturing sector realized its full potential, it
could generate up to 30 per cent of GDP by 2025, thus propelling the country into the
manufacturing big leagues, along with China, Germany, Japan and the United States.
Consequently, on average, workers in Indias manufacturing sector were about one-quarter to
one-fifth as productive as their counterparts in Thailand and China, respectively.
Indias services sector had been growing. Services sector contributed almost 57 per cent of
Indias GDP. It also charted a compound annual growth rate (CAGR) of 9.4 per cent for the
period of 2001 to 2010. This growth was one of the strongest in the world. Revenues from the IT
and ITES sector, as a proportion of national GDP, increased to 7.5 per cent in 201112 from 1.2
per cent in 199798. An increase in disposable income was expected to benefit fast moving
consumer goods (FMCG) companies.
Indian FMCG Industry
According to the Associated Chambers of Commerce and Industry of India, the FMCG industry
in India was the fourth largest sector with a total (organized) market size of more than US$15
billion in 2007. It was classified into the premium segment (~25 per cent), which catered mostly
to higher/upper middle income consumers, and the popular price sensitive or mass segment (~75
per cent). It was predicted that the FMCG market would reach US$33.4 billion in 2015 from
US$ billion 11.6 in 2003.
3. HUL: Company Profile
Hindustan Unilever Ltd. (HUL) was a subsidiary of Unilever Inc. With strong local roots in more than
100 countries across the globe, Unilever had annual sales of about 46.5 billion in 2011. Of the more than
400 brands of the Unilever Group, 12 generated sales in excess of 1 billion a year. These 400 brands
spanned 14 categories of home, personal care and food products. As of May 2011, Unilever employed
more than 167,000 people worldwide.
With over 2,000 distributors, over 2,000 suppliers and associates, about 2,900 stockists, a direct
coverage of over 1.5 million outlets and a total coverage of 6.4 million outlets, HUL could boast
of having one of the largest and well-penetrated distribution networks in India. It covered over
700 million consumers across the country including 250 million rural consumers.
Brands
Home & personal care: - Under this it has brands that cater to every income segment of
population. In this segment it has brands like Lakme, Axe, Pepsodent, Surf Excel, Wheel, Lux,
Dove, Fair & Lovely & many more.
Foods & Beverages:-Under this segment it has brand like Kissan, Knnor Soups, Annapurna,
Kwality Walls, Brooke Bond and Lipton.It has also launch water purifier with the name Pureit.
4. Employee Welfare at HUL
In 201112, HUL had more than 16,000 employees including 1,500 managers, over and above
the more than 50,000 indirect employees that HUL and its many businesses generated
employment for. Workers health welfare was ensured by the company as all medical expenses
were covered through an insurance scheme in case a worker fell sick. For employees lost in
service, HUL ensures that their childrens education is fully taken care of.
5. Key Challenges
Competition
Between 2001 and 2004, HUL faced increasingly intense competition and price wars, resulting
in low single digit revenue growth. The organization was considered to be arrogant and
conservative. Morale was at its lowest, and HULs reputation as talents dream destination was
starting to unravel. It was also the period when some of the companys star performers left for
other MNCs.
Fall in Dream Employer List
In 2007, HUL fell to fourteenth in the dream employer list among graduating business school
students, after being the leader for almost two decades. Factors such as job prospects and
content, degree of independence, market standing of the company and salary package influenced
the students choice.
Postings
The traditional formula in the manufacturing industry category, especially the FMCG sector, was
that employees were first posted in a factory in a small town in the hinterland. This was typically
followed by a sales assignment in a bigger town or city. Head office postings at Mumbai were
always at a later stage as one rose up the career ladder.The work-life balance which new
employees expected challenged this traditional employment and job model. The younger
generation of premier business school graduates was not willing to wait that long. They wanted
to work for five years and make it big.
Career Path
One problem facing the company was the slow rate of career advancement. In 2001, it took 16 to 18 years
of experience before employees could achieve a senior management position. By 2011, this had been cut
to 14 years.
6. Key Questions Posed
How would HUL retain its young pool of managers?
How would the company make employees feel part of its larger vision and mission?
How would it make itself a full-fledged flexible organization?
How would it continue its eight-decade long legacy of being the "CEO factory" of India?

7. Proposed Solutions
The company can take up the following steps to make employees feel part of its larger vision and
mission:
Provide a Positive Working Environment
One of the main reasons employees quit is the relationship with their first-line supervisor. The fact
is many supervisors and managers are unaware how their actions and decisions affect employee
turnover. A critical aspect of an effective retention strategy is manager training. Properly trained
managers play a major role in an effective recruitment and retention strategy. Managers need the
skills, tools, and knowledge to help them understand their employees' retention needs and be able
to implement a retention plan designed to increase employee engagement in the organization.

Clear Communication
At the lower levels of the org chart employees are often clueless to the machinations of the top
brass, and it's bound to hurt engagement and productivity. Employees need to have a sense of how
their roles interweave with the larger goals of the company in order to take pride in the importance
of their work and to do the best possible job on every project. Thus HUL should tap as many
methods of communication to reach out to employees as they can, including e-mail and phone
blasts, Facebook, Twitter, and even texting.

Gauge Employee Pulse
The best news for the state of employees' engagement is if they're constantly complaining. The
challenge is to take those complaints and those glimmers of pride and enthusiasm and actually hear
them and turn them into suggestions for change. This can be best done by conducting surveys and
holding townhall meetings so that the pulse of the employees can be gauged.

Involve and Engage
People are more committed and engaged when they can contribute their ideas and suggestions.
This gives them a sense of ownership.
The Sony Corporation is known for its ability to create and manufacture new and innovative
products. In order to foster the exchange of ideas within departments, they sponsor an annual Idea
Exposition. During the exposition, scientists and engineers display projects and ideas they are
working on. Open only to Sony's employees, this process creates a healthy climate of innovation
and engages all those who participate.
TD Industries in Dallas, TX has a unique way of making its employees feel valued and involved.
One wall within the company contains the photographs of all employees who have worked there
more than five years. Their "equality" program goes beyond the typical slogans, posters, and HR
policies. There are no reserved parking spaces or other perks just for executives -- everyone is an
equal. This is one reason why TD Industries was listed by Fortune magazine as one of the "Top
100 Best Places to Work."

Develop skills and potential
For most people, career opportunities are just as important as the money they make. In a study by
Linkage, Inc. more than 40 percent of the respondents said they would consider leaving their
present employer for another job with the same benefits if that job provided better career
development and greater challenges.
Deloitte is listed as one of the "Top 100 Best Places to Work." They discovered several years ago
they were losing talented people to other companies. They conducted exit surveys and found 70
percent of those employees who left to take new jobs and careers outside the company, could have
found the same jobs and careers within Deloitte. As a result they created Deloitte Career
Connections, an intranet-based development and career coaching program for all employees.
During the first week of implementation over 2,000 employees took advantage of the program and
viewed internal job openings. Not only does the program provide new job opportunities, but Career
Connections offers a host of career development tools such as self-assessments, tools to develop
resumes, and articles on various job seeking strategies within the company. Skilled people will not
remain in a job if they see no future in their position. To eliminate the feeling of being in a dead-
end job, every position should have an individual development plan.

Measure Progress
Continuous evaluation and never-ending improvement should be an intrinsic part of the HUL
system. The primary purpose of evaluation is to measure progress and determine what satisfies and
de-satisfies the workforce. The evaluation process includes the measurement of attitudes, morale,
turnover, and the engagement level of the workforce. The followinga checklist of items can be
included in the evaluation and measurement process.
Conduct an employee satisfaction survey at least once a year.
Initiate interviews and surveys concerning the real reasons people come to and leave your
organization.
Improve the hiring process to create a better match between the individual's talents and job
requirements.
Provide flexible work arrangements for working parents and older workers.
Hold managers responsible for retention in their departments.
Start measuring the cost of turnover.
Focus on the key jobs that have the greatest impact on profitability and productivity.
Examine those departments that have the highest turnover rates.
Design an effective employee orientation program.