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

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

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

PRODUCTIVITY - A LOOK: BACKWARD AND FORWARD

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).

11 feb 1981

To:  

All Operations Committee Meeting Members         

PRODUCTIVITY - A LOOK: BACKWARD AND FORWARD

The  subject  of productivity  was  last  reviewed nearly  II months ago -  in Policy Review Committee  meeting dated March 18, 1980.

In that meeting I had  traced the history of the Productivity movement  at  Powai,' beginning with  the  appointment  of  a Committee  in 1975 with MR.  G. Ramakrishna as  the Convener. The Committee submitted its  report in November  1976 and its recommendations   were  discussed  with   the  GMs   and  the Corporate  Management.   Most  of  the  recommendations  were accepted by  the Management but there has  been no subsequent formal  audit (to the  best of my  knowledge) with  regard to their implementation.

After  signing  a  four year  agreement  with  the  Union  in January  1979,  a  formal dialogue  with  the  union  on  the subject  of  raising  our Productivity  level  was  initiated around   September   1979.    A   three-tier   structure   of Productivity Committee was devised and regular  meetings are being held at Powai level and the Unit/Shop levels.

Almost  the entire  emphasis during  the past  18  months has been on  "Communication".   In dozens of meetings  (involving Managers,  Union Office-bearers,  Shop  representatives. Shop Supervisors   and   in    some   cases   ordinary   workmen), graphs/charts/tabulations  have  been projected  to  give all concerned  an idea of the ups and  downs of  shop wise labour efficiency.

All that can be  said for this intense effort is that  now at least there is an  awareness of how Productivity is  measured and where each shop stands.

By and large, however,  there is no evidence of  motivation -an urge  (individual or collective) to do something  to raise the Productivity level.

Although  we have  succeeded in  breaking the  "communication barrier"  (there is considerable openness and honesty -  of -purpose in various meetings),  we have, so far, not  made any dent in the "motivation - barrier".

This, I consider, to be Phase II of our battle.

And why are employees holding back, from  getting emotionally involved in the  Productivity drive?  Is  it that individuals interests are conflicting with the organisational interest?

Is there a "what-is-in-it-for-me" attitude?  Is it that what an employee expects  from his job is different from what the organisation is prepared to offer him?

Answers  to  some of  these  questions  are apparent  in  the minutes of the last Powai level Committee meeting.

To  find out  more,  a  "brain-storm" meeting  was  arranged. Some   six    Union   Office-bearers   and    four   Managers participated.    The meeting   came   out   with  some   200 suggestions on  how to go  about improving  Productivity.  Of course,  some  were  similar/identical,   as  is  usual  with brain-storm meetings.  The  list does, however,  provide some clues to what would "actuate" people.

The one recurring theme is "worker participation and involvement".

There  just  does  not  seem  any  other  way  of  motivating employees.   What  apparently works  at  the  senior  Manager level also seems to work at the blue-collar worker level.

The rate  at which  the wage-levels  have risen  in the  last three/four  years  and the  rate  at  which  these  could  be expected to rise  in the near future (under the  existing CPI linked D.A.  system), material  rewards have perhaps  already ceased to be motivating factor.

If blue-collar 'wages cannot be held down, but can  be safely assumed to overtake those of  the Managers in not too distant future, the only  sensible thing  to attempt is to  raise the "responsibility  consciousness  - level"  of  the workmen  to that of the Managers!

And,  no person  feels  more  "responsible" than  when he  is taking a "decision"  - or participating  in "decision-making" process.   He  becomes  actually  conscious  of  the  "social consequences"  of the  decision and  the repurcussion it  can have on his own image and social prestige.

In L&T, for all  its years of existence, we have  practiced a traditional  hierarchical   type  of  organisation   with  the decision-making  responsibility  and  authority  rising  with each level of hierarchy -  not unlike situations in thousands of organisations around the world.

But rapidly  changing technology over  the last 30  years has also made decision-making process quite complex.

With  increasing  complexity of  business  environment,  each level  of  hierarchy  finds itself  presented  with  new  and difficult  challenges  every  passing   day.   Society's  own expectations of Corporate bodies are for ever increasing.

If we have to  have any time to deal with  "tomorrow", we can only do so by  delegating some of our  "today's" decisions to our subordinates -  right down the line up to  the shop-floor workmen. .

Let us this morning debate whether                     

greater delegation                        

will lead to         

greater employee-participation/involvement                        

will lead to        

greater "responsibility consciousness level"                        

will lead to               

greater individual motivation                        

will lead to               

greater all-round productivity

And,  if the answer is "YES",  where and  how do we  begin a change in our own attitudes?

H.C.   PAREKH

THE CART BEFORE THE HORSE !

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).

25 Jan 1981

To:

My dear Mr.

THE CART BEFORE THE HORSE !

Sub:        A scheme to link up Productivity with Bonus

Ref: Your letter dt. 28th December 1980

In your above mentioned letter, you have expressed many thoughts. I agree with some of these and do not agree with some others.

Matters on which we agree:

1.  When the salient working results of the Company appear in the newspapers, workers start voicing their aspirations on bonus and after the company's Annual General Meeting, pressure groups start expressing demands.

2.  The Management and the Union should work together to find a permanent solution to the bonus problem.

Matters on which we differ:

1.  If the Management and the Union are to work together to find a permanent solution to the bonus issue, it should not only be 'in line with the workers' expectations', but, it should be in line with the Management's expectations as well.

2.  Linking Productivity with bonus does not appear to be the 'permanent' solution that you and I seek - not at least in the near future.

What makes me disagree with you? Let us examine:

Whereas, it is not difficult to think of a Scheme of linking productivity to bonus, where is the assurance that it will work?

Both, the Union and the Management, made one such attempt in January 1979. In our 4-year Agreement, we linked productivity with substantial benefits granted to the workmen averaging approx. Rs.200/- per month. On 'give-and-take' basis, the Union and the workmen undertook to raise the individual/departmental productivity indices by 25 points. That was the linkage.

Nearly two years have elapsed since we first established this linkage - what do we find ? The workmen continue to receive Rs.200/- month after month, whereas the performance indices have largely remained where they were in January' 79 and in stray cases marginally gone up - or even down !

And we cannot say that the workers/Union are unaware of the commitment made by them or unaware of what has actually happened ! With 3-tier Productivity Committees constituted in September '79 (and announced jointly by Mr. the then General Secretary and myself) and the number of monthly meetings taking place, it would be difficult to say that there has been any communication failure in this respect. Despite necessary efforts, both on the part of the Union office bearers and the managers, the results are simply not there ! Why is it that despite so much good-will and communication, the increase in performance indices by 25 points remains a dream?

This is the key question to which all of us must address ourselves. Till such time, we find an answer to this question, (and implement the same) we should not, I believe, attempt linking poor productivity to anything else;

And I believe, I know the answer.

The answer lies in the very human nature. An individual would make additional efforts if he could expect to be reasonably rewarded for- the extra efforts. This is the basic effort/reward relationship. What apparently went wrong with our 1979 Agreement is that we put the 'cart before the horse'. I strongly feel that instead of giving away the reward of Rs. 200/- in advance, had we linked the reward of Rs.8/- per rise of each P.I. point and rewarded only after the PI has actually gone up, we would have by now, attained a total rise of 25 points or perhaps morel

The linkage was supposed to be already there but the effort/reward relationship was twisted !

Should we not straighten out our existing 'twisted' links first before we think of adding others?

Yours sincerely,

H.C. PAREKH

RETURN OF THE PRODIGAL

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).

25 DEC 1980

To:

Dear friends                 

RETURN OF THE PRODIGAL

The Bible speaks of a father and his two sons.

When the sons grew up to become adults, the  father gave each an equal share of  his wealth.  There was also  some fatherly advice on how to make the wealth multiply by working hard.

It so happened  that the younger  son did not quite  heed the advice.  He was  a happy-go-lucky type  of a man  and avoided work whenever he could get away with it.

Now that he  had money in his  hands, to spend as  he wished, the younger  son  left home  and started  visiting places  of pleasure.  He squandered away all his money  and soon started begging for  food.  Half-starving, he  now realized  the good advice of his father but felt too ashamed to go back to him.

Finally, one day  he overcame his  remorse and returned  home. The overjoyed  father  ordered music  and feast to celebrate the event.

When the hard-working  elder son returned home  from the farm and learned of  his father's orders, he was very  unhappy and refused to  take part  in the family  reunion.  Here  he was, toiling away under  the blazing sun to preserve  and multiply the family-wealth and  whose home-coming is being celebrated? - the good-for-nothing vagabond!

It was now  the father's task to explain that whereas  he had greater respect  for the elder  one and  valuad his  work, he loved  both sons  equally.   The rejoicing  was to  mark the return of the prodigal  to the family-fold and to  the family tradition of hardwork and respect for  the elders.  No matter how far he  may wander, a child that returns home  by evening is not to be considered "Lost".'

On this  X-mas day, I wonder if the story  has any relevance to our own times and to our own lives !

H.C. PAREKH