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HR Case Study

HR Case Study

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Published by Sirish Kotipalli
Nice review by Bhargavi on MUL.
Nice review by Bhargavi on MUL.

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Categories:Types, Reviews
Published by: Sirish Kotipalli on Jan 24, 2013
Copyright:Attribution Non-commercial

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01/24/2013

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HR Case Study
Source CiteHR: Posted by Bhargavi
Maruti Suzuki Limited (MSL) is remembered by all of us for the worldclass cars it manufactures. But of late the company is making news for itdubious labour management practices. The company which sells more cars in Indiathan Japan benefits in multiple ways by doing business in India. 80% of thespare parts used in its cars are manufactured by its vendors by employing lowpriced workers and 70% of the workers in MSL factories are contract workersearning less than one third of the salary of regular workers. But unfortunatelythe company does not consider it important to provide proper service conditionsto workers.India has a progressive economic policy and it tolerates ill treatmentof workers for the sake employment generation. Had it been USA and Europe theoperations of MSL would have been closed down by the government for themisconceived labour policies. A plethora of factors are contributing to the degenerationof people management practices in MSL starting with greed for more profit, lack of concern for labour problems, unprofessional approach of managerial staff andsuperstitious beliefs of the employer.Understanding professionalism: Sometimes patients die because of medical negligencewhich is proved by other Doctors through autopsy. Occasionally Chartered Accountantscollude in financial scams like, Harshad Mehta or Satyam Computers, which aredetected by other Chartered Accountants. In either case the Doctors or CharteredAccountants look at the issue dispassionately in search of truth rather than protectingthe professional colleagues responsible for the lapses. Human Resource (HR) Managersclaim themselves to be professionals and they have professional associations likeNational HRD Network to promote professionalism among them. Almost every monththere are HR conferences of one kind or the other happening all over the country topromote professionalism in HR. Every year new HR propositions like HR businesspartner, HR competencies, talent management and so on are advocated to project HRas a profession. However the question remains to be answered is how far Managershave matured to be professionals.The doctors or chartered accountants responsible for the lapses wouldhave lost their jobs or had their licenses revoked. But HR Managers in MSLactually get promotions andpay hikes after every incident of labour unrest.
 
 For example prior to the three prolonged strikes by workers in 2011 at MSL Mr.SY Siddiqi was General Manager (HR, IT and Admn) and after the strikes he waspromoted as Chief Operating Officer.The work at the Manesar factory of Maruti Suzuki Limited (MSL) wasstopped from 18th July 2012 to 21st August 2012 due tothe failure of human resource management function, which has resulted in thedeath of a general manager and injuries to around eighty managers by thevengeance of frustrated workers. While everyone has condemned the attack andexpressed condolences to the demised manager
’s family, no one from the HR
 profession has tried to find out whether and if at all there was anything wrongwith the HR department of MSL.Being a large organization MSL may think that it is capable of earningprofit even by closing down the factory for months or by allowing its managerskilled at workplace but it is also important to be careful about the workers who havenothing to lose. The onlyaspiration, most of the workers have for themselves is to go to work forearning their livelihood. When such a fundamental aspiration has been snatchedaway by the management by falsely implicating them for the misconduct they didnot commit, the workers are left with the only option of expressing anger atmanagement.Poisoning the BenevolenceThe parent company of MSL is Suzuki Corporation of Japan. Japanese areknown for benevolent HR practices like life time employment, decent workingconditions and reasonable salaries. But HR managers in MSL take the advice frominternational consultants by paying huge amount fees. The five advices repeatedlygiven by such consultants are (1) contract worker can be employed in any numberand for any jobs, (2) It is sufficient and lawful if contract workers are paidminimum wages fixed by the government, even though it is very less than thewages earned by regular workers, (3) unionization of workers should bediscouraged at any cost (4) unionization of workers can be avoided by havinglarge number of contract workers and (5) payment of fair wages and providinghumane working conditions are not important if labour department officers of the government are properly managed. While these consultants fail to understandthe socio cultural dimensions of labour unrest, the benevolent organizations likeSuzuki Corporation are branded in India as exploitative employers.Motives behind the violenceMotives of all kinds were attributed by the management, government and
 
the mass media beginning with infiltration of militants, involvement of naxalities and the role of business rivals. Thank god, the only motive notattributed was involvement of neighboring foreign country.The workers have alleged that on the evening of 18th July2012, MSL brought around 100 goons from outside to attack the workers, whichhas not been officially denied by the MSL management. The workers have furtherstated that when they confronted the goons in self defense it led to theviolence. While the motive of workers to indulge in sporadic violence is yet tobe fully investigated, the question at this point in time is whether it was ethical
on the part of any organization to use goons to deal with employees. The workers’
 allegation of outside goons entering the factory is equally difficult tobelieve since no attack or injury of serious nature on the workers have beenreported.The 18th July 2012 violence at MSL is a reasonably wellplanned attack by the workers and they are surely aware of the adverseconsequences like criminal prosecution and termination of service. But it isdifficult to understand why MSL management closed all the peaceful options forresolving the conflict.In the morning there was a fight between a worker belonging toscheduled caste and a supervisor in which it was alleged that the supervisorhas insulted the worker by using derogatory language against his caste and theworker in turn has slapped the supervisor. When both of them are prima facie guiltyof misconduct the management has punished only the worker by suspension andspared the supervisor.
The Maruti Suzuki Workers’ Union leaders have
peacefully negotiatedthroughout the day for the revocation of suspension but management has taken arigid stand not to negotiate in the matter. When the situation was going out of control the management has orally informed the union leaders that suspensionorder will be kept in abeyance. Workers wanted this oral information in writingand management refused to give it in writing which has finally led to the violence.If management was sincere in its words, it was prudent to give it in writing toavoid the violence.Trust and negotiationThere is complete lack of trust, authenticity and transparency betweenthe management and workers in MSL because the management has deviated from itspromises not once but thrice during the year 2011, which resulted in threeprolonged strikes. Trust can be built by openness in communication, fairness indecision making, and devotion for honoring commitments; but the managers in MSLseems to have forgotten all of them.

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