UNIVERSITY OF CALCUTTA

The Lesson, Manesar Has Left

KUNTAL GHOSH MHROM (2011-13) ROLL NO-14

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Recently,

Indias largest car maker, Maruti Suzuki India Limited (MSIL) received a jolt when the infuriated mob of workers at its Manesar plant attacked the officials and set the production line on fire. The incident claimed life of one of the Senior Managers, injured nine policemen and left 100 officials being hospitalized. Though fingers are pointed in all directions, here is a quick recap and analysis of the situation from an HR stand point.

Analysis
With a huge part of Marutis labour being contractual (nearly 50%), conventional engagement methods proved to be insufficient. With contractual labour, companies usually do not have to provide any extra benefits and that exactly helps in cost-cutting. But besides cost-cutting, contractual workers also need motivation and engagement. A number of low-cost techniques or non-monetary efforts can be channelled to achieve this. Instead of fighting the workers, it is important to remember that they are in fact part of the bigger organization and contribute to its success. The sense of belongingness and cohesiveness can in themselves be enough to motivate the workers. In October 2000, the company saw its first major confrontation between workers and the management. Workers were being stopped at the factory gate, their entry made conditional on their signing a good conduct bond. Now heres the catch. Signing a bond may not necessarily facilitate good behaviour. In fact it only promotes a feeling of distrust and disharmony among managers and workers. Managers must take steps to mend the bond instead of taking actions that clearly draw lines of demarcations between the two. In 2001, the management derecognized the old union. The same year, another union was registered under the managements patronage. Only regular workers could become members of the union. While various welfare measures were provided to the union affiliated workers, nonregulars were left in the lurch. Though Maruti is considered a byword for low-cost manufacturing in India, nonetheless it is only fair to consider another company that built a huge workforce of motivated employees that were majorly part-time. Starbucks introduced various plans and benefits

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for its part-time workers, but gained higher employee satisfaction and in turn productivity. Some important labour lessons can be learnt from Harvard Schultzs initiatives at Starbucks that have made Starbucks one of the worlds largest coffee chain. Though there can be no excuses for the violence at the Manesar plant, but the situation clearly needs deeper analysis. For most manufacturing companies, major challenges include increasing productivity and reducing cost. But in the race to achieve this, somehow managers may forget to care and build trust and relationship with their workers. But getting into this habit has proven fatal many times before and the recent violence at Manesar plant is just a reminder. The Maruti management never tried to help workers overcome the trust deficit that had survived their earlier unrest. This unrest turned into roiling aggression and finally took the ugly shape of a riot. What needs to be understood is that earlier signs of unrest and dissent must not be ignored and immediate actions must be taken. In fact, higher productivity and cost cutting can be achieved through other positive ways as well. Engaging employees through various low-cost methods can result in exceptional results. Though it is an evolving and slow process but it has often proved its worth in shaping great organizations.