EMPLOYEE PARTICIPATION: A

STRATEGIC PROCESS FOR

TURNAROUND- K. K. Verma
Presenters:
Anirban Das (MS14A009)
Raktim Paul (MS14A048)

Introduction

This case study describes how employee participation was

developed as strategic process for turnaround in Bank of Baroda
(BoB) in its Madhya Pradesh zone, during 1995-96.
The region was a part of the northern zone of the bank. In July
1994, the region was turned into a zone (including 2 regions and 82
branches) as its branches had increased and directing the business
activity of the vast geographical area of MP from the bank's
northern zone headquarters at New Delhi became difficult.
It worked on the assumption that in a highly unionized industry like
banking, when the unions co-operate and get involved, they would
positively influence their members towards better effort and greater
commitment.

Unions and Associations

The bank had two workmen unions 1) Bank of Baroda

Employees Union, MP (Union 1), recognised by the bank as the
sole collective bargaining agent of workmen and 2) Bank of Baroda
Employees Association, MP (Union 2), affiliated to the AITUC.
With regards the officers, the All India Bank of Baroda Officers
Association, was affiliated to INBOC, a wing of INTUC.

The New Zonal Manager

Early in August 1995, a new zonal manager took charge of the MP zone. The MP
zone's productivity and profitability was much below the bank's average. Since
the status of the MP branches was now that of a zone, the staff unions and
association expected better direction/control of business and career advancement.

Within 15 days of taking charge, the new zonal manager wrote to the branch
managers pointing out the bright economic growth potentials of MP and bank's
excellent business opportunities; he encouraged the staff to discover their
tremendous hidden abilities, and assured all support.

The employees acknowledged and reciprocated the good wishes of the zonal
manager. The management-union interaction also began on a positive note. The
general secretary of the association enquired from the personnel head whether the
management had a definite proposal to discuss.

The Corporate Agenda

BoB's corporate office advised the zones to hold meetings with

unions/association on regular basis upto March 1996 at the zonal
level so that house-keeping arrears could be cleared early, as
mandated by the RBI. Consequently, a joint meeting was called on
20 September 1995 of the two unions and the association with the
management representatives.

Initiative for a larger agenda

The zonal committee discussed whether collaboration of the

unions/association should be sought for business development as
well. The zonal manager pointed out that since all employees were
going to apply for the bank's equity shares in the offing, they would
own the bank and, therefore, irrespective of the affiliations, all had
responsibility for improving the bank's image, reputation for
service, and performance.
The presentation stressed that a larger framework involving
business performance of the Zone was provided for a general
feedback on performance. Leaders of the unions/ association
appreciated the zonal manager's faith in participative management.

Unions Suggestions
Among the various suggestions offered by the unions the following
were noteworthy:
a. The bank should inform periodically the housekeeping position to
the branch staff.
b. Focus should be on improving customer service.
c. The bank should dispose off the pending staff grievances. A draft
circular urged the branch managers to take similar measures at their
ends.

The Second Meeting

The second meeting (October, 1995) moved the process of

collaboration unexpectedly fast.

All present at the meeting expressed that the half-yearly performance

on banking operations was bad. The performance of the 18 branches
represented in this meeting was also not satisfactory. The union leaders
and branch managers were finding fault with each other's constituency.

They agreed that for a positive impact, the management and

unions/association needed to work together. A confrontation between
the managers and the staff saw the gates of co-operation opening up
and greater clarity and direction of collaboration emerging.

Joint Declarations (1/2)

Letter of 30 October 1995:
Since the responses of the unions, the association, and managers
were evidently becoming positive and the zonal manager raised
the issue of "jointly signed letter" suggested earlier in the
September meeting. It was agreed that such letters would be sent
not only to the branch managers but to all employees. It stressed
the need for staff to take interest in business development and
participate in the staff incentive scheme, reduce NPA, increase
recovery, and provide courteous and prompt customer service.

Joint Declarations (2/2)

This letter was the first in the series, followed by:
Letter of 14 December 1995: Focusing on the need for
strategic planning,
Letter of 6 February 1996 : Expressing concern for the
employees well being,
Letter of 11 March 1996: Highlighting customer service
upgrade,
Letter of 6 April 1996 : Announcing satisfactory performance
of March 1996 and requesting punctuality.

Other Initiatives
Other initiatives included:
1) Branch intervention aimed at the zonal level chiefs of unions/association
and regional managers to facilitate branch staff and branch managers to sit
together regularly to:
a) deliberate upon business growth problems, performance targets and how
to achieve them; and
b) initiate actions to involve more and more staff in the business
development process.
2) Mega get-together, which was like an open house to informally promote
teamwork, togetherness, and joint business actions.

Impact of Participative Initiatives

(1/4)
The impact of participative initiatives helped:
1) Improve work processes: The joint letter were started to be read
and taken more seriously ensuing in prompt actions, responsiveness
and initiatives from everyone; the two unions started agreeing with
each other on business issues.
2) Business performance: Involving employees in defining business
issues, contributing to decisions, strengthening communication
about those issues, and promoting team spirit resulted in higher
business growth and profits when the financial year ended in March
1996.

Impact of Participative Initiatives

(2/4)
3) Positive Feedback: The corporate management and the apex level
unions/ association expressed their pleasure at the joint efforts and
appreciated their counterparts in scripting success for the zone.
4) Problem Solving: Great importance was attached to the early
solution of problems so that smooth process continued. This included:
a) Fiasco in a branch: An emergency grievance redressai meeting
between Union II and the branch manager guided by the zonal chief of
personnel was held at the branch, and the branch manager solved all the
pending issues, in a branch in Indore, in January 1996 so that
discussions for business development could be continued full-heartedly.

Impact of Participative Initiatives

(3/4)
b) Threat of a boycott:
In the Gwalior branch, a cashier, an ex-treasurer of Union II, misbehaved a
senior citizen customer due to which he was suspended. The regional
manager of Raipur had organized a joint meeting as a mega function at
Raipur one afternoon. One of the joint secretaries of Union II sought an
emergency meeting with the zonal manager, threatening that his union
would withdraw from the function. The zonal manager explained how
inappropriate it was to link the joint forum with the gross misconduct. He
told him that such suspension could only be settled after the fast track
departmental inquiry. He also telephoned the general secretary in Raipur and
said that if the other union, the association, and the management continued
their joint efforts, the boycott would hurt only Union II. Everything fell in
place after that.

Impact of Participative Initiatives

(4/4)
c) Another bombshell:
In the backdrop of a felicitation at the end of the financial year, the GS
of Union 1, in his letter of 9 April 1996, he stated that he proposed to
disassociate from the joint forum. After thorough persuasion and
prodding by the zonal manager, and a representative from Union 2, the
GS of Union 1 said that the grievances of his staff members at the
branches were not being attended by branch managers who were busy
in business activity. He expressed that his members were criticizing
him. The zonal manager stated that he would organise seminars for his
branch managers to sharpen their skills for quicker disposal of
grievances, and promised that he would give top priority to redressing
grievances in the zone.

The Way Forward

The problem-solving process contributed significantly to

institutionalising the process of co-operation and collaboration. It
kept the process on and integrated. A few days later, the zonal
manager was transferred to the corporate office in Mumbai. The
new zonal manager said at a widely attended function that he too
believed in participative management and promised to carry
forward his predecessor's effort.