STANDARDISATION OF FORMATS ND PRESENTATION METHODS

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 Mar 1980

ALL MANAGEMENT MEMBERS

OF PRODUCTIVITY COMMITTEE MEETING (POWAI LEVEL)

STANDARDISATION OF FORMATS ND PRESENTATION METHODS

Further  to my  Circular of  March  24, 1980,  I invite  your attention to my earlier  Circular of October 24, 1979  on the same subject, reproduced below for your ready reference:

"From  a folder  circulated by  Mr.M.H.  Pherwani,  I enclose herewith a Chapter entitled

"HOW TO START A PRODUCTIVITY  EFFORT".

I   draw  your   particular   attention   to  paragraphs   on 'Diagnosis' &  'Measurement'.  I  am fully  aware that,  in a diverse   operation  like   ours,   no   single  measure   of productivity      (output), using

(input )

identical  'units'  of  measurement   for  the  'output'  and 'input'  could serve  the purpose  of  all  the manufacturing departments.   Even for  'Production', 

different departments may be compelled to use different units of measurement.

What is however, important is     

1.                    1.                                          That all manufacturing departments/shop determine, once  for all, 

THE definitions  of - Production and  -  Productivity that  they

 would follow in  the months and  years to  come.  This             

CONSISTENCY  in the  use of  a_ definition would permit

monitoring  of productivity  improvements over the coming

months.

2.                    2.                                          That all manufacturing  departments Standardise the formats  in

which  they would publish  their monthly reports on- Production

and - Productivity.

Such  monthly reports  may  include  the monthly data  as well as

the  cumulative data  (from the base month of January  1979?) to

enable easy and quick comparisons  of the 'Actual Vs  Budget' on

both   the  parameters   viz.    Production  and Productivity.

3.                  That as far as possible, the definitions of                       

- Production and                      

- Productivity.

 Should  be in  units  of  physical outputs  (and inputs )                   

                         and  avoid  using  measures  of  'Sales  Price', 'Transfer Price'

                         etc.

                         If  for  some reasons,  it  is  not possible  to avoid   use  of  

                         'SP/TP'  etc.,  a   method  of discounting  these  for  the

                         inflation  must  be established.   The  numerator must  be 

                         adjusted using   well   known,   'Price   index'   series

                         published  by  Govt./Semi  Govt./Trade  agencies (e.g. RBI).

I have  already requested the  perspective Planning  Dept. to evolve  one  or  more  'product  Price  index'  series  using published prices  of a large number  of industrial machinery/ agricultural   machinery/electrical    machinery/construction machinery/passenger  and goods transport  vehicles/chemical -pharmaceutical machinery/consumer capital products etc.

By a  copy of this note,  I am requesting  CMS/VM to approach you to finalise

-      -         the definitions

-      -         the formats

for  your  area  of  operations.    I am   convinced  that  a consistent use  of these is  the only way  to know if  we are moving and if so, in what direction."

H.C. PAREKH