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).
|
18 Nov 1986
To:
Dear
Colleagues
"HUMAN RESOURCE MANAGEMENT - PHILOSOPHY &
At the age of 92 years, Konosuke
himself still takes
keen Interest in the
working of the Institute ! He does not
have much time or
energy now for directing
the operations of the Yen 5 Trillion (Rs.4,190 Crores) Matsushita empire, employing over 1,00,000 employees world-wide
in 178 companies - an empire
which he started as a small company 68 years ago !
One member of Matsushita organisation is located in Baroda
and known as Lakhanpal National
Limited (LNL). Erploying around 700 persons, LNL
was set up in 19/3 to manufacture dry-cell-batteries, under the brand name "NOVINO".
In the October Seminar, Mr. Ono, the Joint Managing Director of LNL read a
paper describing how
LNL has set-about transplanting the Matsushita Philosophy
on the Indian soil -
and in a limited manner
proving that,
"Human
nature is same all around
the world and what motivates a Japanese worker also
- and equally - motivates
an Indian
Worker".
Encl:
APPLICATION OF K.MATSUSEITA'S
MANAGEMENT PHILOSOPHY
Firstly, I would like to thank XAL Human Growth Centre and the PHP, for having given this opportunity to speak before you.
brief HISTORY
I would like
to begin by briefly discussing about our Company's growth since its Inception. Our
company, Lakhanpal National Limited, started production
of dry cell batteries in July 1973 at Baroda. It was in the
year 1969, that our late Prime Minister, Mrs. Indira Gandhi, visited Japan. While there
she visited the Head
Office and one of the factories of Matsushita Electric Industrial
Company Limited and also met its founder Mr. Konosuke
Matsushita. She was greatly Impressed by Mr. Matsushita's
business principles and
his philosophy during
her visit there. It was her enthusiasm that prompted Mr. Konosuke Matsushita to provide technical assistance and cooperation
In India.
It was in
the year 1971, when late Mr. D.D. Lakhanpal
(founder of Murphy India Limited) obtained an industrial licence for manufacturing
dry cell batteries. He was In the process of evaluating various prospective partners to get the technical assistance, when he came
across M/s Matsushita Electric Industrial Company
Limited (MEI) of Japan. The late Mr. D.D. Lakhanpal very much appreciated the business philosophy of MEI, and in return
MEI also thought highly of his ideas and thoughts
as an Industrialist.
The project
was conceived at the time
of Bangladesh War, when long spells of blackouts In
the country led to an acute shortage of dry cell batteries, and turned battery markets Into a sellers paradise. This temporary boom was reflected In the project report, envisaging 100% capacity utilisation in 3 years
time. But it was too optimistic to be true. Very soon the war boom was over and we faced
stiff competition In
the existing market. Factory construction at Baroda finally began
in August 1972.
During that
time in India It was
not possible to register
'National' as a trademark.
Moreover, use of foreign trademarks was also
not allowed. Under circumstances, the company decided to use 'NOVINO' as its trademark.
Another
company of MEI in India, i.e. M/s Indo National Limited, also started under similar
circumstances. In other countries MEI
established factories as joint
venture or
wholly-owned subsidiaries, sometime after products had already been marketed in those countries
under the 'National' label. Thus there was already a strong market channel and brand awareness existing in those countries.
In India, however, due to severe restrictions
on the importation of electric goods, 'National' products were not
normally available In the market place,
although many people In urban areas knew about 'National' and 'Panasonic' products since these were available as smuggled goods. Yet we could not take advantage of these well
known brand names and had to start with an unknown
and new brand name 'NOVINO'.
Duster
— An Important Tool for a Salesman
Other than the installation
team, four people were dispatched from MEI-Japan for a period of
2-4 years.
One of these persons was responsible for market development. This sales engineer went to all parts of the
country and visited
shops personally, explaining the finer points of our
product. During his shop to shop visits, he
would introduce himself first
and then start service. He would first try to 'sell' himself Instead of the
product, cleaning the counters in shops and rearranging products
for better display.
This act of courtesy and service to the retailer set an example for the Indian Staff
Members who always
accompanied him.
Even today he is remembered fondly by all concerned. For sales people this
is the most effective and essential part of
Personnel training. It is said that
our salesmen's most important tool is a 'Duster'.
The factory started commercial production and put the first consignment on the market within a year of the stone laying ceremony, i.e.
In August 1972, a remarkable achievement which gained
the respect of everyone In the community.
Even though
production started
smoothly, sales did not
expand according to the planned projections. We had to face the giants
of the Industry of that time, many of whom had a large market share and a long
history in the marketing of dry cell
batteries.
Moreover,
the oil crisis caused a dramatic downturn in the world economy In
the year 1974. The battery Industry in
India also had to face a very tough time. Consumption of batteries
declined constantly for a period of 3 years, and.
It took nearly 5 years to return to 1973 levels.
The future looked bleak and
uncertain, but we knew we had to think of ways to
avoid layoffs, as layoffs would affect the
employees and their families most adversely. Despite the scorching
heat in the month of May, everyone went all out to
do what they could to improve the situation. Our female employees
carried 2 boxes of batteries, weighing about 5 kgs. each from
house to house in town to sell them.
Routes were organised dally In different
parts of the town. On the other hand,
our male employees, worked hard on the open space in the factory premises. They levelled off the uneven ground, laid down a lawn and constructed
a guard room at the factory entrance.
During those
difficult days, our
people had to bear up under pressures from the outside community as well.
Our factory is situated at N.H. No. 8 and
while our people were digging
or levelling land, passerby
made taunting and sometimes abusive remarks. But such remarks
were Ignored by our employees who all continued to
work as a team, with no distinction of-class or status. We
discovered an immense joy in pooling our efforts to
complete— these tasks inspite of the hardships. This was a most valuable learning experience for all of us.
If my memory
serves me well, it was' in May 1973 that our
machines were Installed. May being the
hottest month, it was hard to cope with heat at first. During
the first 3-6 months six people came from Japan to
install the machines and to teach and train our
staff members. They took the lead In doing the actual work and spared no effort to educate
our people. The majority of our people
in charge of various functional
areas today are those who worked along with the Installation team during those days.
I still remember clearly the greasy black
hands and uniforms of these people after a day's
hard work.
Language
Barrier
One of the
problems we faced at that time was that the
installation team could converse in Japanese only a language which was not understood by
local staff members. This made communication very difficult. Moreover, this also created many misunderstandings with the local staff members. The Japanese installation team applied all its energy to discover ways to make the job
easier and to impart the basic knowledge of dry cell manufacture to everyone.
They concentrated on this even after returning home,
which was usually always after 8 or 9 at
night. Their nights
were always utilised for planning job for the next day.
Indian
Industrial Culture — A Different Experience
Before we
came to India, we were
told that people in India want to return to their
homes immediately after work. During my visit to India before the
start of Lakhanpal National Limited I was myself very much surprised to see employees In
other factories assembled
at the gate, waiting for the siren to sound so they
could go hone.
We were also
told that In many industries the persons in charge of manufacturing even
hesitate to personally go to the shop-floors.
However, In Lakhanpal National our experience
was different. Whenever It was necessary
our people worked overtime, even overnight, without problems erupting between
supervisory personnel and shop-floor workers.
Self Discipline
The
responsibility for the
discipline of employees in any company rests, I believe, with
the management team.
Since Its Inception our Company has put a lot of emphasis on discipline. In my opinion the first aspect of discipline is punctuality. In our factory, the first
shift and the general
shift begin at 8 o'clock in the morning. Only in rare instances is a person late for work. Most of our people in the managerial cadre, come at least 20 minutes before the starting time.This sort of practice,
develops an eagerness among the employees to follow the example of their seniors to
work with discipline. Referring back to
my earlier talk about developing the lawn on the
factory grounds by our own employees, I would like
to emphasise that this was possible only because the supervisors themselves took a great Interest in these tasks and set an example for the others by taking the lead in doing the actual work.
During those
days, even our staff members in the office, took the lead in doing the cleaning. They
always looked after their own work space and kept it
clean by themselves. Even the chief
executive of our factory used a
broom, to clean his work space. Today with the increase in common
space, janitorlal service is provided but the
spirit of looking after
one's own work space remains.
We at Lakhanpal National Limited do not believe that cleaning Is a low cadre job and hence. should be performed only by a particular segment of
society. We
strongly believe that
cleanliness is necessary to ensure good quality and
efficiency. It
is hence very important that every one cleans his
own machine and his own working area. This creates a feeling
of pride In one's job, one's tools, one's work
place, and the company as a whole.
In our
factory today, the operators on the shop floor all clean their own machines and
work places Even in our office; we do not have 'menials ', whose only job is to
carry files and documents
around. The staff members themselves do these
tasks. Even seniors and supervisors go
around to deliver papers and files whenever necessary.
This system helps to improve communication within various departments and also enhances one's understanding and knowledge regarding the working of other
supporting departments. Moreover, we do not have
separate cubicles in our offices for Managers.
Every one works in the open office without invidious distinctions based on status or type of work.
This helps to achieve better
co-ordination and understanding amongst various
departments because every one is familiar with
conditions In all parts of the
company
When an
employee makes a mistake, except those of a very confidential or sensitive nature, he is
corrected by his superior in the open office in the
presence of his colleagues. This system helps all the other members In
the office to be careful and avoid similar mistakes, thus
serving as a method of indirect
instruction.
"Management by All Employees"
Our company,
since its beginning,
has professed to have a system of full participatory
management or "management by all employees." This, however, docs not mean that an employee
is free to say anything he likes to the managment. He
must act and think within
the framework of the declared direction and policy of management.
There Is
little merit in merely
criticising a particular decision or a duty one has
to perform In his organisation,
and less in simply reporting
that a problem exists. Criticism and reporting must
be combined with
suggestions to solve problems to be meaningful.
But for this to happen. It Is very important that everyone In the organisation be aware of current conditions in the company
and the business environment. Regular
'Manager meetings', 'Engineer
meetings' etc. provide our senior executives with opportunities to get a clear grasp of the
status of corporate operations.
Morning Assembly
Another
feature of our company is the daily morning
assembly which begins with recitation of the seven
corporate objectives by all employees in unison.
Through the
morning assembly each
employee reaffirms his commitment
to the company and Its objectives before each day's work. This morning
assembly also becomes a. forum for communication,
where different views are exchanged and one gets to
know about the activities
of other sections or departments. Since any Individual
employee can come forward In the assembly and speak, the sense of community and solidarity is enchanced.
Furthermore,
the monthly production and sales
results along with plans for the coming
month are also announced In the morning assembly. 'This helps to
improve
communication since all employees come to know
about the company's performance in production and sales well before the
Annual Report is published.
In many business circles It is said that details of corporate performance are privileged information, and
should not be disclosed to the work force. But according to our policy, an employee, being part of the
management, has to know the company's record and future plans, for our policy
of "Management by All
Employees" to be effective.—Without making available
this kind of information, It would be meaningless to speak of
"Full Participatory Management".—
Policy Announcements
Every year,
on the 26th of January, we announce the Company's new annual policy to all employees.
Details of the year's target with regard to production, sales, efficiency and other areas
are made known to the employees. A review of the previous year is also
announced.
It is after
the annual policy announcement that each department prepares its own plan in the light of the general policy. The company does not believe in keeping
secrets from its own employees.
This policy announcement day coincides
with Company Day, when employees who have served the company for long periods
and those bearing good records in attendance during the
previous year are commended and presented momentos.
Novino Family
In our
Company, we often use the word 'Family'. Once, our employees even formed 'Novino Family Union' and hence the
word "FAMILY" is very much familiar to
all of us at Lakhanpal National Limited.
We
understand that a family means a group of people bound together by relations of
unquestioned trust and confidence, like the relation
shared between parents with their own children or a child with his
own brother or sister. Similarly, management has, or
should have this trusting relationship with its
own employees. That Is what we mean by a
corporate family. Now when we emphasise trust and treat our employees like family members, how could we keep any secrets from
them? Hence even sensitive information like the
latest production and sales figures is disclosed to all
employees.
It is due to
this relationship that we do not suspect our
employee going out of the factory premises after
day's work and hence, we do not have a "body-check" system at the
factory gate. We have yet to come across
incidents of employee taking
away factory property even though the practice of free passage has been inexistence for the
last 14 years.
Neither do we have the time-card
scheme, wherein an employee
records the time he
reports for work. We have a system where
one simply places his
card into an "in box" for his
department. This too has not created any
problems for us.
Our company
has adopted several control systems, not for the sake of taking precaution against error but to ensure the maximum utilisation of all social
assets — people, money and many other
things - which are entrusted to It by society.
To give an example, in each phase of the productions process our
operators keep records, and check the quantity of raw materials and components to be used
as well
as the finished products and the unused raw
materials and components at the end of a work
cycle. Every month a physical inventory
check is conducted by the Accounts Department which immediately prepares a full report. The inventory check, therefore, should be seen as a way
of making the fullest use of resources entrusted to
the company from society, by clearly stating the
results of the previous month's activity and providing necessary information
for an action plan for the next month ; and not as a system for preventing mischiefs on the
part of employees.
Recently,
there has been a boom in schemes for promoting employee suggestions and Q.C. Clicles. In our company this
year we are working on 23 circles,
some of which operate in non-production departments, such as the Personnel, Accounts,
etc. As for suggestions, we received on an average of 3.2 suggestions per employee last year. The most important factor in the success of
all these activities is
top management's zeal, active
participation and encouragement to employees.
Success In
developing Q.C. Circles or suggestion schemes
cannot be achieved through mere imitation of form. Instituting structures and procedures without securing employee
cooperation
may actually make the employees lose their
enthusiasm for their work.
Because our
activity in these fields
is in its Initial stages, I
feel that, Instead of asking
employees for immediate results, we should strive for still
greater participation by employees,
and make sure they have the active support and encouragement of To?
Management. This alone will lead to ""Full Participatory'
management and the benefits thereof.
Another
important aspect of communication is with our employees'
families. We have a house journal — 'NOVINO DARSHAN' —
which is published and circulated to all employees
once every quarter.
This helps In regularly communicating information about the activities
and performance of the company to the family members of our employees. In addition, the
company organises a cultural programme and the
sports meet once every year In which all employees participate
and enjoy together with their
families.
Due to a
lack of space it is not possible for us to invite
as many people as we would like, but nonetheless around 3000 persons normally
attend these functions every year.
Sometimes we
find that an employee is forced to take a long
leave from work because he has taken ill or because there has been an unexpected calanity In
his home. In these circumstances, his superior makes 'it a point to visit the employee's house to meet with and to cheer up him and his family.
Except when I have very tight schedule, I also go along on such visits. There Is
no rule In our company with regard to this system. Our senior
executive and managers arrange these visits
voluntarily as they consider an employee a part of 'NOVINO
FAMILY'. This system helps In
developing a much better understanding between management and the work
force.
There are no
barriers separating employees according to grade or rank, and maximum effort is made to see that there is free and frank communication among all the members of the 'NOVINO FAMILY'.
Open Door
Policy
I am the
only one who has a private office, but even so my
door Is always open to all. Our canteen,
the bath rooms, etc. are for the use of everyone. There is no special place reserved
for the special few. All employees,
including myself eat the same lunch In the same
canteen.
In our
factory all employees from the top executives to the lowest rank of employees, male and female, wear
uniforms.
During the early days, many of our employees, particularly females had many reservations about wearing the uniforms. But now the situation has changed. Even though changing rooms are provided in
the factory, it is a common site now to see employees coming to and returning from the factory In
their uniforms.
When all
employees wear a uniform identical in quality and design they have a greater sense
of equality and mutual understanding.
Of course
there has to be a clear cut distinction between people with respect to their responsibilities in the organisation, but there cannot
be any sort of distinctions made among them as far as their
humanity is concerned. This is a
fundamental principle of our corporate philosophy
and management style. One example in this regard is
the yearly picnic which is organised among our
departments. All employees go to a particular picnic place, use the same transport, sing and play together and share the same food. In short, every one enjoys the festivities together and without discrimination.
This helps
in strengthening the relations
between the members of our "NOVINO FAMILY'. Without a strong bond of truly human relationships, people tend to
become stiff and unable to cooperate with the natural
flexibility needed to produce good results.
Our ultimate
aim is that all of us should work together until our retirement
to create a bright and fulfilling place to work
that we can proudly bequeath to the coming generation.
Our first corporate objective Is 'National Service through Industry'. This does not mean that our
sole concern is to increase sales. Our primary goal is to have our work recognised
by society. If society accepts our work we are sure to receive a reward from it in the form of reasonable profit.
In turn,
this profit allows us to show our gratitude and make a positive
contribution to our society. We are proud to pay our fair share of taxes, for this
Is one way which we can demonstrate our gratitude
to the society in which we operate. Moreover, we believe
in doing our best to contribute to the society in
other ways. You all must be aware of
last year's drought in several parts of India. The
management was approached by our employees, stockholders
and distributors who asked us to help the people
affected. We then decided to supply
water to the drought-stricken citizens from late March until monsoon set in. We did this because we are members of this
society, and because we realise that for a society to prosper each member must be willing to help others in time of need.
What I want
to stress here is that timing is also very
important. Of course, huge sum of money and
other articles are required in order to help those in drought-effected areas. But main point Is to get them as much help as
possible in the time of their
greatest need. Realising that after the rain
start it would be of no use to carry water to those areas, we undertook to do what we could to supply water to them.
We didn't undertake
this action because of any reward, but were gratified
. beyond all expectations by the enthusiastic appreciation it received.
Employees
Training
In our
company we emphasise "on-the-job-training" for the new employee. However, because of
a dramatic increase in business around the year 1979, the number of employees too Increased sharply. Accordingly we felt that 'OJT' alone
would not be sufficient and that we must have a more
systematic and organised training system.
With this in mind,
we are planning to establish a full-fledged training centre for the employees. When a new employee is recruited in our
company, his Initiation is conducted by the Chief
Executive himself, who personally Informs him about the company policy. Another avenue for the employee training is 'Off-the-Job Training'.
Opportunities for such training are made
available on an average once a month.
Our
promotion policy is to encourage promotions from within the
organisation. Once an employee is identified for promotion, he has to select a project theme
on which he is to
work throughout the year.
During
the course of the year, he makes two or three interim
presentations to a team of Senior Executives to get further suggestion and guidance. After
the final presentation, if he is judged suitable, he is
promoted to the next grade.We call this
scheme the 'Self-Development Scheme.—
The
important aspect of the 'Self-Development
'Scheme' Is that it
requires the employees
to Identify a problem In his own area of work,
analyse it In detail and make their
best efforts to solve the problem by
taking a systematic approach. In order to achieve his goal within the prescribed time
limit, the candidate has to make an all-out effort. The candidate who
successfully
completes this
course develops a special capability to tackle any
problem in a very systematic way.
In the early
days, since our total strength was less, it was
possible for our senior executives and managers to train the subordinates directly
under them. However, now with the expansion of our
business the work force has increased and we are also dealing with much higher number of outsiders. Thus direct
communications between our managers and non-supervisory personnel has declined.
From the
point of view of personal development. It Is not enough for an employee to just pass
through the 'Self-Development Scheme'. We also
feel it important to emphasise the development of the individual as a human being.
This we want
to achieve by establishing our own 'training centre' and conducting
several educational programmes.
Thus far I
have spoken to you about our daily activities and training facilities. I hope this will
serve as a fruitful basis for discussion. We realise that
many improvements could be made in our programmes and their
Implementation, and would welcome any suggestions you might have.
Our slogan this year is 'Create the future by strong
follow up'. A plan may be excellent but until and unless it is followed up with perserverance it will not achieve its goal.
In fact the leader of the organisation or
section that should
have strongest drive to 'follow up' and see that
plans are implemented.
In
conclusion, I would like to extend my sincere thanks to all of you for your patient attention to my description of our experience at 'Lakhanpal National '.
Thank you
BASIC BUSINESS PRINCIPLE OF LAKHANPAL NATIONAL LIMITED:
TO RECOGNISE
OUR RESPONSIBILITIES AS INDUSTRIALISTS, TO FOSTER
PROGRESS AND TO PROMOTE THE GENERAL WELFARE OF SOCIETY, AND TO DEVOTE OURSELVES
TO THE FURTHER DEVELOPMENT OF WORLD CULTURE.
PROGRESS AND
DEVELOPMENT CAN BE REALISED ONLY THROUGH THE COMBINED EFFORTS AND CO-OPERATION
OF EACH MEMBER OF OUR COMPANY. EACH OF
US, THEREFORE, SHALL KEEP THIS IDEA CONSTANTLY IN MIND AS WE DEVOTE OURSELVES
TO THE CONTINUOUS IMPROVEMENT OF OUR COMPANY.
*************
SEVEN
OBJECTIVES OF LAKHANPAL NATIONAL LIMITED
1. NATIONAL SERVICE THROUGH INDUSTRY
2. FAIRNESS
3. HARMONY AND
CO-OPERATION
4. STRUGGLE FOR BETTERMENT
5. COURTESY AND HUMILITY
6. ADJUSTMENT AND ASSIMILATION
7. GRATITUDE
*************
COMPANY'S SONG
WE STRIVE
FOR PRODUCTION, WORK WITH ENERGY,
ALL THE
RACES LIVE TOGETHER WORKING SIDE BY SIDE,
LIKE A
PERPETUAL FOUNTAIN WE PRODUCE CONSTANTLY,
TO DEVELOP
COUNTRY'S INDUSTRY WE WORK IN GOOD HARMONY, AIM IS PROGRESS THROUGH CO-OPERATION
HARMONY AND
SINCERITY, LAKHANPAL NATIONAL
**************
H. C. PAREKH
No comments:
Post a Comment