Hi Friends,
                                              Even as I launch this today ( my 80th Birthday ), I realize that there is yet so much to say and do.
                                                  There is just no time to look back, no time to wonder,"Will anyone read these pages?"
                                       With regards,
                                       Hemen Parekh
                                       27 June 2013

Tuesday, 1 December 1981

"WHAT MAKES JAPANESE CAR MANUFACTURERS SO PRODUCTIVE?"

Synopsis: Communication For Productivity
Letters written to some 7500 Workers / Managers / Union Leaders, following a period of strike / Go slow / Murders (1979 - 1987), at Mumbai factory of Larsen & Toubro Ltd. This direct / open / honest communication led to a remarkable atmosphere of trust between Workers and Management, which, in turn, increased productivity at 3% per year (ave). 

1 Dec 1981

To:
Dear Friends

In my  last communication, I said  that a Japanese  thinks of his  company  first before  he  thinks  about  himself.   The article by  Peter  Hazeihurst, highlighted  this attitude  by describing  the  behaviour  of  Japanese  workers  when  they agitate for a demand.

In  this   issue,  David  Clutterbuck   (Associate  Editor International   Management) tells us   about  the   Japanese workers' "involvement".

When I read:    

"WHAT MAKES JAPANESE CAR MANUFACTURERS SO PRODUCTIVE?"

I could  appreciate what the Japanese  are trying to  achieve with all of their  robots and automation and  their computers and so forth.

What  amazed me most  was the  willingness and  the readiness with  which the Japanese workers  involved themselves  in the task  of  raising  productivity.   Apparently  they have  not heard  such phrases as  "My job"  and "Your  Job"'. I  have a feeling  that   if  the  Japanese  were   to  read  our   "Job Classifications"  in the  YELLOW BOOK,  they will  be equally amazed.!!

Shall we try to .pick up the leaf out of their "Book"? With best wishes,

H.C. PAREKH

Thursday, 1 October 1981

LAND OF THE RISING SUN

Synopsis: Communication For Productivity
Letters written to some 7500 Workers / Managers / Union Leaders, following a period of strike / Go slow / Murders (1979 - 1987), at Mumbai factory of Larsen & Toubro Ltd. This direct / open / honest communication led to a remarkable atmosphere of trust between Workers and Management, which, in turn, increased productivity at 3% per year (ave).

1 Oct 1981

To:

Dear Friends


Japan  is  called  the  "LAND OF  THE  RISING  SUN"  although strictly speaking  it is the  Soviet Russia which  greets the new day every morning !

But Japan has  already overtaken Russia to become  the second largest economy  in the World -  next only to  America.  Many experts  believe  that  Japan will  soon  bypass  America  to become the strongest industrial society in the world.

What is the secret of  Japan's success?  Almost every country is trying to find out  if there is some "MAGIC FORMULA" which the  Japanese  seem to  have  mastered.   From  all over  the world, dozens  of delegations have gone to Japan in search of this "MAGIC FORMULA".

What they  have found out  is that there is  no single simple formula!  BUT ONE THING  HAS BECOME CLEAR - THAT THE JAPANESE PEOPLE THINK OF  THEIR COUNTRY FIRST.   THEN THEY THINK ABOUT THEIR  COMPANY AND ON  SOME RARE  OCCASIONS, WHEN  A JAPANESE THINKS  ABOUT HIMSELF,   HE ALMOST  FEELS "GUILTY"  TO  BE SO SELFISH '.'.

And that makes Japan work.

Last year when I reproduced  "Britain Works —  O.K." many of you responded, welcoming the serial.

This  time .our  focus  is  on  Japan.   I  am  happy   to reproduce  'here,  a   despatch  from   Tokyo   by  Peter Hazeihurst titled.

"WHEN JAPANESE WORKERS GO ON STRIKE"

If anyone has any  comments, please do feel free to  write to me.  I,  for one, believe that  EXCELLENCE AT POWAI  CAN ONLY COME OUT OF A RESPONSIBLE AND  PARTICIPATIVE DIALOGUE AMONGST ALL SECTIONS OF EMPLOYEES.

With regards,

H.C. PAREKH

Friday, 4 September 1981

INDUSTRIAL RELATIONS PERSPECTIVE-PART-II

Synopsis: Communication For Productivity
Letters written to some 7500 Workers / Managers / Union Leaders, following a period of strike / Go slow / Murders (1979 - 1987), at Mumbai factory of Larsen & Toubro Ltd. This direct / open / honest communication led to a remarkable atmosphere of trust between Workers and Management, which, in turn, increased productivity at 3% per year (ave). 

4 Sep 1981

Dear Mr. Grover,

Sub: INDUSTRIAL RELATIONS PERSPECTIVE-PART-II

As far as I can determine violence in industrial situations have occurred due to the following reasons:
1.  Apparent conflict of interest between the workmen and the management.
2.  Inter-Union rivalry for power to control the workmen and to be in a position to bargain with the Management.
First, we must examine what are the interest of the workmen and the interest of the management. Then, we may examine, if these interests are conflicting in nature. Obviously, the management wants the company to grow and remain profitable. I suppose, this is also what the workers want and therefore, there is no conflict here.
The conflict starts on the issue of the employees share of prosperity of the company. The question that has remained unresolved so far is:
What is the respective contribution of the labour and the management in the prosperity of the company.
Then, there are others who also have a share in the prosperity of the company, i.e.
       the share-holders, the society and the consumers.
Through intricate laws on sales-tax, on excise, octroi, corporate taxes, etc. The Govt. representing the society has already determined its own share. In most of the companies neither the workmen nor the management consider it necessary for the company to go beyond these Statutory obligations and share its prosperity with the community or the society at large in terms of health care, education, rural development etc. this is largely a voluntary effort on the part of a few enlightened organisations. Even in this case, how much to share with the society, is largely an unilateral management decision where workers do not have much say.
As regards the society and the shareholder’s there has not been much dis-agreement between the workmen, management and the Government. They are being rewarded according to fairly established traditions for the risk capital they made available for running the organisation.
The consumers, by and large, are a forgotton lot. A very few managements (and none of the Unions) have bothered to protect the interest of the consumer. Under highly protective market condition, most the managements have been able to sell whatever they produce of whatever quality and at whatever cost. In their unholy anxiety not to allow an unit to turn ‘sick’, the Govt. has encouraged inefficiency. Such units, when made to dole out huge wage increase under pressure from the unions, have merrily passed on the burden to the consumer through increased product prices. The Indian consumer has not yet learned to protest and the Union and the Management have not yet learned to care:
If we now examine the workers aspirations (interest) we may find some clues to the causes of the conflict. The worker aspirations can broadly be divided as :
   i.      Physical needs
  ii.      Mental needs
Physical needs themselves have two components – i.e. the short-term and the long-term.
The short-term physical needs primarily centre around earning the cost of living for oneself and one’s family. This would include food, clothing, shelter, education, entertainment etc. these needs manifest themselves in demands for better wages and higher bonus.
For the employee himself, the short-term needs at the place of work are better working conditions.
The long-term physical needs comprise of –
   i.      Improved standard of living
  ii.      Retirement benefits
Whereas, there can be no dis-agreement on the rights of the workmen to unite and bargain collectively with the management, the fulfillment of their physical needs, the question to be asked is:
-    Can a group of individuals be allowed to take more out of society than what they give to the society ?
-    If this is allowed to happen, wealth cannot be created. It is only when each section of the society gives more to the society than what it takes away, can the societal wealth increase ? Under any other conditions, only some can live a better life at the cost of impoverishment of the lives of many others.
From the foregoing, it has become clear that any increase in the wealth of the society directly depends upon similar increases in the individual and collective productivity.
What, therefore, a group may be allowed to take our from the Society should be determined exclusively from the increase in productivity of that particular group over a period of time. For the share in the prosperity brought about through increased productivity, must always be after the productivity increase has taken and not before. This is the crucial principle of sharing the prosperity of an organisation by the people involved.
Whereas, productivity-based collective bargaining has become an essential feature all over the indudstrialised world, this has been sadly lacking in our country.
On the one hand, there are thousands of small-scale manufacturing organisations employing 10/20 workmen where gain of all the productivity is cornered by the owner manager. On the other hand there are hundreds of medium and large-scale organisations employing between few hundreds to few thousands workmen where the Unions have been able to extract wage increase far in excess of any increase in the labour productivity and sometimes, even when the labour productivity has actually fallen! And all of this, under the threat of strike and closing down the organisation. These are the ‘high-wage islands’ where exploitation of reverse kind is taking place!
One can apportion some of the blames for this sad situation to the Management, to the Government – the management for having giving in under such threats and the Government for having failed to protect the management against such unreasonable demands.
The system of dearness allowance to neutralise the rising cost of living was first introduced in our country more than 40 years ago. The DA system has taken deep roots in our country and has become an inseparable part of the compensation structure; but, does it have to be element of compensation plans even for completely new undertakings coming up in backward areas of the country with no tradition of industrial employment? Can we not encourage these units to do away with the DA system and instead have an annual wage increase directly linked with the actual increase in the physical productivity of the work force during the preceding year?
As far as the existing manufacturing units are concerned, the least, we could do is to ensure that the long-term wage agreements which are negotiated once in ¾ years are strictly based on the physical productivity improvements achieved during the preceding period. I have particularly chosen to express productivity in terms of ‘physical output per person’ so as not to be mislead by the improvements in ‘sales turnover per person’. This is because any number of companies have managed to substantially raise sales turnover by simply increasing the selling prices of their products even when the real physical productivity of the organisation continued to decline.
To implement the proposal outlined by me above, the Government should ask each manufacturing unit to submit for consideration by the Government as well as the Union, its proposal for the measurement of physical productivity of the unit and the proposed linkage of the future long term wage increases with the improvements in the productivity of its work force. To my mind, it is unimportant whether the Government and the Union accepts the management proposal in toto. What is important is for all the parties concerned to accept the principle of ‘creation of wealth before sharing the same’. It is only thro’ such a scheme that we would be able to come out of the vicious circle of the wages and the prices chasing each other. In a country where once upon a time ‘work was worship’ the situation today is that workmen want to have more and more wages for working less and less. This erosion of work ethics is the most serious matter before the nation today. If productivity linked wage increases can restore some of the work ethics, we would have won a major battle against inflation. If our trade and industry have to survive in the world arena against fierce international competition, we must be willing to reward efficiency and stop worrying about the inefficient units which have to close down. This is because our responsibility as a nation, does not end with worrying about the present work force. We must necessarily worry about the millions of able bodied jobless persons who cannot even secure one square meal per day. What kind of social justice is that where an unskilled worker getting Rs. 800 per month is allowed to agitate militantly for a wage increase of Rs. 200/- p.m. whereas, for every one such person employed, there are 100 outside the factory gate who cannot get a job even for         Rs. 200 p.m.
As far as the mental needs of the workmen are concerned, these are primarily in relation to the job satisfaction and the status that participation in the process of management brings. So far, this aspect has not become an issue of collective bargaining – not at least in our country. Managements should however, ignore this at their own peril! If managements do not come forward with satisfactory schemes of worker participation, time will come soon when these items also become matters of collective bargaining. At the same time, I strongly believe that this is not a matter that should be legislated and I would earnestly request the Government to keep away from framing any laws in this regard. A genuine desired for allowing worker participation in the process of management should come voluntarily form the Managements and arising out of a fundamental conviction.
I enclose herewith :
Some slides on the subject which illustrate my own concept of how this model should be built and implemented.  
We may discuss this in some more details should you so desire.
The foregoing are my thoughts on the subject of ‘collective bargaining’
As far as ‘Go – slow’ is concerned, I agree that it worse than a strike. Given willingness on the part of the state Labour Commissioner. It should not be difficult for him to establish whether a management’s complaint of go-slow is valid or not. All that he needs is to request the management to furnish daily/weekly production records, of six months preceding the period of go-slow and compare the same with similar figures for the period of go –slow. The Union may be allowed to cross examine the management in the presence of Labour Commissioner with regard to such other inputs as availability of raw materials, electricity, manpower, machinery etc. the outputs for both the periods should be of course, in the physical units only. Once the Labour Commissioner is satisfied that a go-slow has actually taken place, he should be empowered to direct the Union and the workmen concerned to step up the output to an average of the monthly output of the preceding six months and simultaneously authorize the management for a pro-rata reduction of wages for the period of the go-slow, till such time the normal production is restored. I do agree that the solution may not be as simple as I have tried to make out. However, given a desire on the part of the Government to get rid of cancerous disease which is sucking the life of many an industry, it should be possible to find a more acceptable Solution.
In closing, I would only like to add that sooner the Unions, the Managements and the Government realize that ever-increasing labour legislation is not the solution to the problem of strained industrial relations, the better it would be for all concerned. Possibly, we already have more labour laws on our statutes than any other country in the world! If labour laws by themselves could ensure harmonious industrial relations, our industrial society should be the object of envy for the rest of the world! What we find in reality is actually the opposite. All these laws have incessantly talked about the ‘rights’ of the workmen and how to protect these rights. If we must have one more law, it is high time, it is about ‘the duties’ of the workmen.
Whereas, all of the foregoing are my strictly personal views, we at L&T have tried to move in the direction indicated therein. Over the years, we have had a strong internal union of educated workmen.
Under the constructive guidance of Bhartiya Kamgar Sena lead by Shri Dattaji Salvi, the worker-leader have been responsive to some of the thoughts expressed earlier.
I also enclose herewith :
a)  A write-up from our internal house journal – powai pageant
b)  Translation of an interview with Mr. Dattaji Salvi which appeared in Mumbai Sakal dt. 7.8.81.


H.C. PAREKH

INDUSTRIAL RELATIONS PERSPECTIVE-PART-I

Synopsis: Communication For Productivity
Letters written to some 7500 Workers / Managers / Union Leaders, following a period of strike / Go slow / Murders (1979 - 1987), at Mumbai factory of Larsen & Toubro Ltd. This direct / open / honest communication led to a remarkable atmosphere of trust between Workers and Management, which, in turn, increased productivity at 3% per year (ave). 

4 Sep 1981

Dear Mr. Grover,

Sub: INDUSTRIAL RELATIONS PERSPECTIVE-PART-I

We are happy that we got an opportunity to discuss with you and your colleagues on 27th August 1981. The matter of deteriorating Industrial Relations Climate in our country with special reference to the city of Bombay.
As made out in our letter of 11th August and during our discussions, the Ministry of Labour has decided to ‘conduct an in depth study of growing violence. We have ourselves had a limited experience of violence. But the seeds of violence are likely to be present in any organizations. I would therefore, like to record my views on the presence of such seeds.
My thoughts have been illustrated in the enclosed paper.
I have also summarized the conclusions of the situation in the end of the above said paper.
I have, you would find the information useful for your study. I would be happy to hear your views on my paper. I would also like to receive a copy of your final report as and when ready.

With kind regards,


H.C. PAREKH

Monday, 8 June 1981

THE NEW INDUSTRIAL RELATIONS

Synopsis: Communication For Productivity
Letters written to some 7500 Workers / Managers / Union Leaders, following a period of strike / Go slow / Murders (1979 - 1987), at Mumbai factory of Larsen & Toubro Ltd. This direct / open / honest communication led to a remarkable atmosphere of trust between Workers and Management, which, in turn, increased productivity at 3% per year (ave).

8 June 1981

To:
Dear friends

THE NEW INDUSTRIAL RELATIONS
"Industrial  Relations" are  the two  most inaligned words of English  language these days.   Thousands of  learned people, all around the world, are writing  millions of mostly not-so-learned words about IR.
As far as  I can see, industrial Relations  are really "Human Relations  in an  industrial Situation".  And  there are  any number of  situations where humans get  together and transact business (using human relations) such as:
-      Medical Situations
-      Legal Situations
-      Religious Situations
-      Family Situations, etc. etc.
But we do not hear much talk of:

Medical Relations, or
Legal Relations etc.

Why is that so?
Simply because, in those situations,  the relations involved/ invoked  are  basically treated  as  "Human  Relations"  and tackled as such.
Also  because,  in  most  such  cases,  the  relationship  is between two individuals, viz:
-      A   Doctor and a patient
-      A   Lawyer and a  client
-      A   Priest and a parishioner
-      A   Father and a son.
But when  it comes  to an  industrial situation,  the picture suddenly changes !
Here,  all kinds  of "third-parties"  get involved.   And for some  of these,  their
very  existence  depends upon  getting "involved" !
These "third" parties are :
-      The Labour Commissioner
-      The Labour Courts
-      The Labour/Management Lawyers
-      The Labour/Personnel Professionals
-      The Union Professionals
-      The "Advisors"
-      The Government, etc.etc.
The list is endless.
So what  should  be essentially  a  "person-to-person" affair has been turned  into a "public affair"!  The attitude of the "third" parties  is, "How dare  you settle  the issue  all by yourself just the two of you?"
Coming to  think of  it, left to  themselves, the  worker and the  supervisor are  incompetent to  "mess-up"  the matter -they need "third" party help to do this.' I
Thank God, "third" parties  have, as yet, not  discovered how each   one   of   us   manages   his/her   "person-to-person" relationship after working hours!
I  enclose herewith  first part  of  an article  on  "The New Industrial    Relations".    Although    there   are    those "omnipresent"  third-parties  in  the article,  the  message, essentially is  to get back to  the "Human Relations"  - on a person-to-person basis.
I hope those of  you who believe in "Miya Bibi  Rajee, to Kya Karega Kazi"  and waited  to practice  it, would  be able  to renew their faith through this article,   in any case, please feel  completely free  to  share  your  views with  me  -  in writing or across the table.

H.C. PAREKH

Tuesday, 26 May 1981

PRODUCTIVITY

Synopsis: Communication For Productivity
Letters written to some 7500 Workers / Managers / Union Leaders, following a period of strike / Go slow / Murders (1979 - 1987), at Mumbai factory of Larsen & Toubro Ltd. This direct / open / honest communication led to a remarkable atmosphere of trust between Workers and Management, which, in turn, increased productivity at 3% per year (ave). 

26 May 1981

To:
Members of the Corporate Management (individually)           

             PRODUCTIVITY


I enclose herewith a copy of the minutes of the last Powai Level Productivity Committee Meeting.

The first Powai Level Productivity Committee meeting was held on. 24th August .1979 - almost 21 months ago. A total of 10 such meetings have been held so far, averaging one meeting every two months.   The frequency of the apex meeting (Powai level) was once every month when the productivity drive was launched.  The frequency now is once in 2/3 months.

As reported in my last OCM Presentation (February 16, 1981), the communication between the managers and the Union has by now acquired a good measure of openness and trust.  There are still many differences of  opinions  - but  these  are stated explicity.  There is also an appreciation of the fact that there may not be immediate solution to all the problems.   The  attitudes  on   either  side  are  gradually shifting  from one of  'adversary' to that  of cooperation in finding a solution.

I enclose herewith a copy of  a recent article on 'Industrial Relations in  USA'.  I consider  the contents of  the article as being very  relevant to the present state  of evolution in industrial relations that we  ourselves are passing thro' and therefore,  I 'have arranged  to  distribute  copies of  this article to  all .shop supervisors and  managers in  Powai.  I suggest  we   set  aside  one  entire  day   to  discuss  the experiments/theories mentioned in this article.   We may even attempt to chart our future 'IR' strategy.

In the meantime,  I would like to draw your attention  to the serious concern expressed by the members  of the Productivity Committee (in the minutes enclosed) with  regard to the under loading  of  various  shops  and  its  effect   on  the  shop productivity.

H.C. PAREKH

Friday, 1 May 1981

BRITAIN WORKS O.K.

Synopsis: Communication For Productivity
Letters written to some 7500 Workers / Managers / Union Leaders, following a period of strike / Go slow / Murders (1979 - 1987), at Mumbai factory of Larsen & Toubro Ltd. This direct / open / honest communication led to a remarkable atmosphere of trust between Workers and Management, which, in turn, increased productivity at 3% per year (ave). 

1May 1981


To:


Dear Readers


Although the first chapter of BRITAIN WORKS O.K.  came out a day  before  Mahatma  Gandhi's birthday  last  year,  it  did contain  the   theme  which  Mahatma   kept  on   asking  his countrymen throughout his life time i.e.

'What is right?'     
  rather than 
'Who is right?'

During   the  last   7  months,   this   publication  aroused considerable  interest  amongst  L&T-ites.  in the  February issue  we published  the comments  which  we received  from a 'well  wisher' who wanted all  of us  to be  less selfish and make   sacrifices for   the  good  of  the  company  and  the community.

In  this issue,  we  reproduce a  letter  from another  'well wisher'.  While  he has  made certain  comments, he  has also raised some  questions.  Although the  well-wisher has chosen to remain anonymous  (I do not understand why),  I feel I owe him an answer.

Whereas,  a common dining  hall and  common food  could bring Managers/Supervisors   and  Workmen   together  (this   is  a strictly  personal opinion)  it is  not  the only  thing that brings people  closer to each other.   It is true,  that in a family, all members share  the same food - but then, a family is  also  one of  the  few remaining  institutions  where one member does not  make 'demands' on another member!   It is an institution that  is  built  on everlasting  mutual  love, an intense   individual  desire  to  sacrifice   in  the  larger interest  of  the Unit  and  an everlasting  respect  for the elders.   Let us  work  together to  make L&T  such  a family first!

As regards obtaining a sense of  achievement and satisfaction in one's own work  is concerned, I do not  think there is any limitation  imposed by division  of  labour.  No matter,  how small a task,  the satisfaction one derives  comes from doing it  well today  and trying  to  do it  even  better tomorrow! Although I  do not  know what  is the task  performed by  the 'well wisher',  I cannot imagine the  task to be useless  and not contributing  to the well-being  of the  Society in which we live.

As  far  as  participation  by  all   levels  of  workmen  is concerned, I entirely agree with  the 'well wisher'  that the participation  in  our  productivity  drive must  not  remain restricted to  the office bearers of  the Union and  the shop representatives but must ultimately spread  to each and every employee of the Compan
As far as  implementing the many suggestions  which I receive in all sorts of forums,  I have only this to say.  Changes do not occur  overnight, and the  changes  of attitude  are most often the  slowest and the need for a change  in attitudes is not limited to any particular group  of employees.  Next time we have a problem, let each one  of us ask ourselves 'what is right'? before taking  a stand which is  against the interest of the community at large.

H.C. PAREKH