Coal India Limited faces fast depleting manpower reserves

As it plans to double its output, Coal India Limited is faced with a major human resource crisis, a recent organisation-wide study has revealed.

The company fears staff poaching once mining in auctioned blocks begins, and its ranking among its PSU peers is lowest in key HR parameters.

The study has revealed some major challenges and some uncomfortable perception issues. "The company has already been confronting an attrition rate of about 11%, which may go up due to the opening of mining sector and increased economic activities in the country," the HR report said.

To top it, Coal India is faced with superannuation of about 750 middle and senior management personnel every year, which is leading to draining of years of knowledge base.

Coal India aims to recruit 5,000 freshers every year, but that won't be able to recreate and replenish the knowledge base that takes decades to form. "High rate of superannuation is a serious threat to the tacit knowledge base.

It is a challenge to transfer this knowledge base to the new breed of managers. The company has to put in place effective mechanisms to address the challenges of knowledge erosion," it said.

Also, while the bottom managerial level is being replenished, there is a vacuum in the middle management preventing adequate supply of talent to top management.

Beyond recruiting and retaining staff, Coal India feels it need to move away from seniority driven promotions to a merit oriented system to fulfil the career aspirations of high-performers. "At present, there is a system of promotion by interview only at the level of E-7 onwards, and the rest of the promotions are based only on seniority. It will deprive high performers and promote mediocrity in the organization. CIL cannot achieve high growth with policies and standards that promote mediocrity," the report noted.

Another aspect bothering Coal India is the perception problem among its own employees as revealed in the survey.

"A study on 'organizational culture' reveals a grim picture. The employees perceive the organizational processes as below average. Similarly, the study on trust index reveals that it is below the average index of leading companies in the country."

In fact, Coal India, after participating in the Great Place To Work Institute of India's Best Employer Survey in 2014, found out that most of its employees have given the corporation's people processes and practices a rating of only 2 in a scale of 5.

"Similarly, the findings of trust index study reveal that the trust index of CIL is significantly below the average trust index of the top 50 companies in India," the findings of the HR report said.

What's more depressing, a KPMG study benchmarked against other major PSUs like IOC, ONGC, NTPC and BHEL, ranked Coal India's succession planning lowest at 1 on a scale of 5.