Participative Management
MBA-HR-04: Participative Management
UNIT I
1.
What do you
understand by Participative Management? Explain its need and objectives.
Ans. Participative
Management refers to as an open form of management where employees are actively
involved in organization’s decision making process. The concept is
applied by the managers who understand the importance to human intellect and
seek a strong relationship with their employees. They understand that the
employees are the facilitators who deal directly with the customers and satisfy
their needs. To beat the competition in market and to stay ahead of the
competition, this form of management has been adopted by many organizations.
They welcome the innovative ideas, concepts and thoughts from the employees and
involve them in decision making process.
Participative
Management can also be termed as ‘Industrial Democracy’, ‘Co-determination’,
‘Employee Involvement’ as well as ‘Participative Decision Making’. The concept of
employee participation in organization’s decision making is not new. However,
the idea couldn’t gain that much popularity among organizations. Studies have
shown that only 3-5 percent of organizations have actually implemented this concept
in their daily operations. Though the theory of participative management is as
old as the institution of employees and employers still it is not applied by a
large proportion of organizations.
The
idea behind employee involvement at every stage of decision making is
absolutely straight. Open and honest communication always produces good results
both for organization as well as workers. Freedom and transparency in company’s
operations take it to the next level and strengthens the basis of the organization.
On the other hand, there are several companies that straightway rule out the
possibility of participative decision making process. According to them,
employees misuse their freedom of expression and participation in decision
making as it provides higher status to employees and empowers them.
Participative
Management is known as employee involvement or participative decision making.
This is a dynamic group oriented concept. It encourages the involvement of
stake holders at all levels of an organization. Employees are invited to be the
shareholders of the company or stand at board of directors to solve and raise
the problems at work level and argue on collective agreement on rules,
regulations, orders and delegation. It provides autonomy to employee for doing
their job it helps to ensure the increment in productivity, job satisfaction.
It ensures higher level of motivation, improves quality of work done and so on.
It plays the role of non financial reward for motivation and happiness. It
considers human feeling and aspiration. Business organizations are now an
important social institution. Newer policy regarding social goals and value are
also to be implemented. Participative management helps to enrich the social
norms and increase the profit on all aspect of the society and economy. It
gives oneness feeling to the employees too.
Objectives
of participative management
1. to make the
best use of human capital
2. to meet the psychological needs of employees
3. to retain talented staff
4. to increase productivity
5. to establish harmonious relationship
6. to maintain proper flow of communication
2. to meet the psychological needs of employees
3. to retain talented staff
4. to increase productivity
5. to establish harmonious relationship
6. to maintain proper flow of communication
Advantages of
participative management
1. increase in
productivity
2. job satisfaction
3. motivation
4. improved quality
5. reduces cost
2. job satisfaction
3. motivation
4. improved quality
5. reduces cost
Disadvantages of
participative management
1.
decision
making slows down
2.
lack
of secrecy
Participative
management is based on the concept of industrial democracy. It encourages the
involvement of stakeholders at all levels of an organization. It helps in the
analysis of problems, development of strategies and implementation of the
solution. It helps in increasing the responsibility of employees, forming
self-managed teams, quality circles, and provides survey feedback.
Participative
Management is an open form of management where employees are actively involved
in the decision-making process of the organization. It is based on the concept
that when the worker invests his time, he should be given an opportunity to
express his view and opinion. They know that the employees are the facilitators
who deal directly with the customers and satisfy their wants and needs. This
form of management has been adopted by many organizations to beat the
competition in the market and to stay ahead of the competition. They welcome
the innovative concepts, thoughts, and ideas from the employees and involve
them in the decision-making process.
The
concept of participative management in organization’s decision making is not
new. However, the idea couldn’t gain that much popularity among organizations. The
theory of participative management is as old as the institution of employees. The
employers are still not the proportion of organization.
Here,
the employees are invited to share in the decision-making process by
participating in the activities like setting goals, determining work schedules,
and making suggestions. Participative management itself do not ensure success
and should not be seen as the tool to create magic within no time. Certain
ground preparation is required before an organization can decide for the implementation
of participative management. Participative management involves more than
allowing employees to take part in making decisions. It also helps to create
the ideas and suggestions of employees with consideration and respect. The
direct employee ownership of a company is the most extensive form of participative
management.
Need of the
Participative Management
Participative
management creates a sense to motivate employees to increase productivity in
order to achieve their goals.
a)
Clearly Defined Objectives
There
must be clearly defined objectives in each party to decision-making called as
the participants namely by the participative management. Operationally there
should be no clash between the objectives of the organization. The objectives
must be clear and achievable.
b)
Clear Communication
Clear
communication builds trust between the two parties. There should be clear
communication between the management and the workers or the employees. With the
help of communication, the workers also gain a sense of responsibility to
increase their stake in the work and in the organization as a whole.
c)
Psychological Satisfaction
Participative
management is needed in order to give psychological satisfaction to the
employees. They feel a kind of important when their views are taken into
consideration.
d)
Choosing the Representative
It
is important for the workers to choose their representative from among
themselves. This is important for two reasons. One is, the person is able to
better understand the problems and report the same to the management. The other
is the management needs to talk and listen from a person who works within the
organization.
e)
Training the Workers
Further
training is required to ensure that every person at every level should know
his/her contribution. Training is required to make it more effective. For
example, the level of middle management is different compared to participation
at lower or top level of participation.
f)
Confidence
Both
parties workers and the management need a trust to develop a confidence between
the two. Participation should not be perceived as intimidation to the position.
If the workers think of affecting their status, they refuse to participate.
Similarly, they will decline to participate, if the managers suspect that they
will lose their authority.
g)
Removes grievances of employees
Participation
of employees is needed in order to remove doubts, misunderstandings, and
grievances in the minds of employees. It helps to remove grievances in the
company. So, it leads to the progress of the organization.
h)
Increasing Workers Participation
Workers
participation needs to be increased at each level in order to encourage them.
The suggestions and recommendations of the workers must be treated with full
dignity and respect. Nothing can be more motivating than seeing your
recommendation being put to practice.
i)
Legal Action
Some
legislative action is required to the employees. Since participative management
requires structural and cultural change, there is resistance to change to those
who perceive it as a threat to their status and authority within the
organization especially offered by the employees.
j)
Raised industrial production
Participative
management is needed to raise the industrial production. When employees are
given importance and a chance to express they work with an enthusiasm and
interest.
k)
Creates Responsibility
If
more employees are involved in the activities of the organization, they would
feel responsible towards the organization. A responsible approach is created
among the employees by the participative management.
l)
Management Relation
Participative
management is needed in order to establish management relation. The
participation of workers in management can act as an effective means for
preventing industrial disputes.
m)
Uniformity
The
Participative management is needed in order to have uniformity approach of
employer and workers. Uniformity has importance to both the parties.
Participative
management can be a solution for each and every type of organization. It is a
great challenge in organizations with large employee size. The implementation
needs to be carefully planned and gradually implemented.
2.
Elaborate upon
participative management from various view points.
Ans. Participative
management is not a magic cure for all that ails an organization. Managers
should carefully weigh the pros and the cons before implementing this style of
management. Managers must realize that changes will not take effect overnight
and will require consistency and patience before employees will begin to see
that management is serious about employee involvement. Participative management
is probably the most difficult style of management to practice. It is
challenging not only for managers but for employees as well.
While
it is important that management allows employees to participate in decision
making and encourages involvement in the organization's direction, managers
must be cognizant of the potential for employees to spend more time formulating
suggestions and less time completing their work. Upper-level management will
not support a participative management program if they believe employees are
not meeting their daily or weekly goals. Some suggestions for overcoming this potential
problem are to set aside a particular time each week for workers to meet with
management in order to share their ideas, or to allow them to work on their
ideas during less busy times of the day or week. Another idea that works for
some managers is to allow employees to set up individual appointments to
discuss ideas or suggestions.
Managers
should remember that participative management is not always the appropriate way
to handle a given situation. Employees often respect a manager that uses his or
her authority and makes decisions when it is necessary. There are times when,
as a manager, it is important to be in charge, make a decision, and then accept
the responsibility for the choices made. For example, participative management
is probably not appropriate when disciplinary action is needed.
When
managers look upon their own jobs as a privilege instead of as a
responsibility, they will fail at making participative management work. They
will be less willing to turn over some of the decision-making responsibility to
subordinates. Another reason that participative management fails is that
managers do not realize it is not the same as delegating or simply shifting
responsibility. Participation alone has no value; it is only an effective tool
if it is used to solve problems and meet goals. Some managers believe that
inviting employees to join in meetings and form committees will create a
successful participative management program. However, these measures are only
successful when employees' ideas are accepted by management and implemented.
The
larger the organization, the more difficult it becomes to institute a
participative management style. Large organizations have more layers and
levels, which complicate effective communication and make it difficult to register
the opinions and suggestions of a diverse group of employees and managers.
Critics argue that unions are often more effective than participative
management in responding to employee needs because union efforts can cut
through bureaucratic organizations more quickly.
Participative
management programs can be threatened by office politics. Due to hidden agendas
and peer pressure, employees may keep their opinions to themselves and refuse
to tell a manager if they feel an idea will not work. Managers also play a part
in politics when they implement participative management programs to impress
their own bosses but have no intention of seeing them through.
Many
companies have experienced the positive effects of participative management.
Employees are more committed and experience more job satisfaction when they are
allowed to participate in decision making. Organizations have reported that
productivity improved significantly when managers used a participative style.
Participative management is not an easy management style to implement. It
presents various challenges and does not succeed overnight. Managers will be
more successful if they remember that it will take time and careful planning
before they will see results. Starting with small projects that encourage and
reward participation is one way to get employees to believe that management is
sincere and trustworthy.
In
the United States, there is a widespread philosophical belief that people have
a right to be involved in making decisions that affect their lives. This is
matched by a belief that people who are involved in making decisions have a
greater stake in carrying out those decisions than those who are not involved
(Bloom 2000:5). In addition, Ackoff (1999) asserts that employees at all
levels, but particularly those in the lower half of U.S. organizations, have
become increasingly disturbed by the inconsistency of living in a society
“dedicated to the pursuit of democracy but working in organizations that are as
autocratic as fascist dictatorships.” Participatory management is widely
perceived as an attribute of socially responsible companies (Collins 1996),
with participation in decision making at the workplace seen as central to the
democratic vision and basic to the good society (Greenberg 1986).
These
core values are reflected in five different perspectives on the purpose and
rationale for worker participation in organizations (Bolle de Bal
(1992a:603-610):
♦
The Managerial Approach, which is inspired by productivity and efficiency goals
(participation is organized at a lower level in order to relieve worker
dissatisfaction and morale problems). This approach reflects the emerging
viewpoint that organizational design and management effectiveness can provide a
significant competitive advantage. It gives considerable attention to issues of
organizational design and organizational change, on the basis that entirely new
work structures and ways of organizing work can lead to substantial gains in
effectiveness (Lawler et al. 2001). A key issue in this approach is the extent
to which management delegates or retains the power to initiate, frame, and
terminate participative processes. It also reflects management’s view that the
direct participation of workers undermines union power.
♦
The Humanist Psychology Approach, which is inspired by human growth and
development goals, (participation as a way to enhance the well-being of the
individual by promoting individual creativity, self-esteem, and ego strength).
This approach reflects the movement led by Elton Mayo , and followed by the
work of Argyris (1957); Likert (1961); McGregor (1960); Mohrman and Lawler
(1985); Cassar (1999); Massarik 1983; and Sagie (1997). It reflects a much more
positive view of human nature and emphasizes the need to retrain managers to develop
their participative leadership skills and unlearn authoritarian behaviors. It
acknowledges the societal function of the workplace and the benefit of
participatory restructuring of the workplace, given the central role it plays
in the lives of most ordinary people (Pateman 1970).
♦
The Industrial Relations Approach, which is inspired by democratic goals
(participation is not only a means to an end in itself but also a way to create
a strongly democratic society, characterized by active participative citizens).
This approach reflects the importance of the external environment to the
organization (not highly recognized in bureaucratic, hierarchical organization
design, but more widely recognized in organic, open-system designs).
Participation in the workplace is seen as contributing to an effective and just
society. The workplace is seen as a point of leverage from which to achieve a
more egalitarian redistribution of power, leading to a greater democratization
of the entire political process (Emery and Thorsrud 1969; Bachrach and
Botwinick 1992; Pateman 1970; Matejko 1986).
♦
The Political Approach, which is inspired by revolutionary goals (participation
as a means to change the overall structure of ownership to a collective base
and to educate workers to class consciousness). The role of organized labor is
addressed in this approach, with Bachrach and Botwinick (1992) noting that
worker participation in postwar U.S. is substantially less developed and
widespread than in Europe, a factor attributed to the weakness of the trade
union movement in the U.S. and the absence of enabling legislation such as is
present in Europe. Advancement toward greater worker participation is seen as
very dependent upon a strong labor movement.
♦
The Psycho-Sociological or Anthropological Approach, which is inspired by
synthetic, multidimensional goals (participation as a way of acculturation, of
pushing workers to internalize the economic norms of the organization) and
emphasizes the fundamental aspects of human nature and how to get the best out
of workers. It emphasizes the fundamental social interactions in the workplace
and the role of participation in addressing issues of resistance, motivation,
and engagement (Lewin 1947; Coch and French 1949; Bolle De Bal 1992a and b). This
approach draws a clear contrast with traditional Taylorian and bureaucratic
models, which attempt to exclude subjectivity and creativity. In this approach,
subjectivity and creativity are integrated into the enterprise culture.
It
should be noted that not everyone subscribes to this positive view of
participatory democracy or to the benefits of direct participation in the
workplace. Unions, for example, argue that participative processes are actually
detrimental to the welfare of workers, enabling management to capture the
knowledge of workers and circumvent the protections provided by collective
representation (Fantasia et al. 1988; Bolle de Bal (1992b), reflecting the
generally more critical European perspective, notes that participation in the
workplace has features that are not uniformly positive for all interest groups.
3.
Give an account
of the origin and growth of participative management.
Ans. The scheme of
workers' participation in management has a long history in India and the joint
consultation as a participatory management style has a much longer history of
evolution. It was first introduced around 1910 in the textile industry which is
one of the oldest of the organised industries of the country. Gandhiji was the
first Indian political leader who advocated the formation of a labour union to
redress the grievances of workers. In India, the TATA Iron and Steel Company at
Jamshedpur was perhaps the first to set up a works committee consisting of the
representatives of the management and the workers. The setting up of these committees
was strongly recommended by State Governments and the Royal Commission on
Labour.
The
Government has been trying for the last four decades to introduce the scheme of
workers' participation in management. The schemes of works committees, joint
management councils and worker-director aim at institutionalization of the
theme or concept of industrial democracy. These schemes have been introduced with
the hope that participation and involvement of employees in the process of
decision-making will reduce mutual suspicion and hostility and create
harmonious industrial relations. The works committee, set up by the TATA Iron
and Steel Company Limited, in 1919 with management and trade union
representatives, did not last long due to trade union rivalries. In 1920, as
per the advice of Mahatma Gandhi, the Ahmadabad Textile Mill and the unions of
the Mill agreed to set up joint consultation councils to settle disputes. The
Royal Commission on labour (1931) in its report though accepted that workers' organisations
are weak, recommended that efforts in the direction of constituting works committee
should be taken.
In
India, Participative Management has been given a legal framework through the
Industrial Disputes Act of 1947. The Act insisted that the works committee
should be formed if the number of employees exceeds one hundred. The scheme has
all along been an integral part of Government's labour policy in India. Its
underlying philosophy has been enunciated from time to time in the Five Year
Plan documents. In the First Five Year Plan (1951), the planning commission
considered that works committees, "will be the best vehicle for improving
labour relations and promoting employer-employee relationship in the Interest
of higher production and greater well-being of the workers through the progress
of industry.
The
importance of participation has been described in the Industrial Policy
Resolution of 1956, in the following words: "In a socialist democracy,
labour Is a partner in the common task of development. There should be joint
consultation and the workers and technicians, should wherever possible, be
associated progressively with management. Enterprises in public sector have to
set an example in this model".
The
Second Five Year Plan Document state that for ensuring industrial peace, better
relations and increased co-operation, steps should be taken increasingly to
associate labour with management, and it is "a prerequisite for the
establishment of a socialist society. Then in 1957, voluntary Joint Management
Councils were instituted".
Despite
these efforts, it has been generally felt that workers' participation in
management has not been successful in India. "The Indian experience
provides little encouragement to those who would like to see a greater and
speedier development of participative managerial practices ... possibly there
might have been less participation without such efforts. But certainly the evidence
does not suggest that these have led to notable advances in increasing the
participative role of workers or union in the decisions of the firm.
The
Third Five Year Plan (1961) also emphasised the need for the strengthening of
industrial democracy in the country. It maintained that, "for the peaceful
evolution of the economic system on a democratic basis, it is essential that
workers' participation in management should be accepted as a fundamental
principle and as an urgent need". The plan document visualized that in
course of time "management should arise out of the working class
itself" and that such a step would greatly help "to promote social
mobility which is an important ingredient of a Socialist system".
The
Government of India adopted a number of industrial relations strategies to
facilitate industrialization process and the scheme of "workers'
representation in Industry" [(Resolution No.S.61011 (4)/75- DK-I (B)] on
October 30, 1975, the workers' participation was declared as a part of twenty
point economic programme. Reduction of industrial conflict and Improvement of
productivity were the main objectives of the programme. Shri. R. Venkataraman,
the then Union Minister of Finance in his speech, in a conference, said:
"workers' Participation in Management is one of the techniques adopted by
this Government to achieve a harmonious relationship between labour and
management and to promote social justice. The Directive Principles of State
policy enshrined in our constitution have laid down that the state shall take
steps by suitable legislation or in any other manner, to ensure the participation
of workers in the management of undertakings, establishments or other organisations
engaged In any Industry. The Government has undertaken several steps to implement
this constitutional directive . . ."
The
Fourth Five Year Plan urged for the extension of the Scheme to the public
sector undertakings, and emphasised its importance as an essential functional link
in the structure of industrial relations. The Administrative Reforms commission,
in its report on public sector undertaking, recommended that the
representatives of the workers should be included as Board of Directors of the
Public sector undertakings. Such representatives are those who are actually working
in the enterprise. Such representation was recommended for the industry units
only.''
The
Fifth Five Year Plan too highlighted the need for industrial democracy and
considered participation by workers in the management process as highly
desirable. Finally the scheme laid greater emphasis on the importance of
effective two-way communication and exchange of information between the
management and the workers. Since the publication of the scheme in November,
1975, approximately 1186 public sector and private sector enterprises have
implemented a scheme for workers' participation in management on the shop floor
level.
The
then Union Minister Mr. Vengala Rao told in the Rajya Sabha, "The scheme
for workers' participation in management has been implemented in shop floor
plant level in 94 central public sector undertakings. He has told that there is
no public sector undertaking which had workers' participation at board level.
However, trade union leaders have been appointed in the Board of Directors of
Seven Public Sector undertakings. There is no need to adopt "hire and
fire" schemes as the public sector undertakings have sufficient powers to
deal with inefficient employees.
The
Sachar Committee also recommended issue of shares to workers. It proposed that
10 to 15 per cent of new issue must be made to the workers. The Committee
proposed a loom or 12 months' salary or a maximum of Rs.12,000 must be provided
to the workers for acquiring shares. As soon as the Janata Government took
charge in 1977 a committee on workers' participation and equity was formed in
September, l977 under the chairmanship of Thiru Ravindra Varma and it submitted
a draft report in 1978 with the following recommendations:
a)
To have a three-tier system of participation at shop floor and corporate level.
b)
Supervisors and middle management personnel should have participation in different
forums.
c)
There should be an agency both at state and central level to monitor the implementation
of the scheme and its review.
The
Sixth Plan noted the strained industrial relation during the preceding years
which had partly contributed to inadequate capacity utilisation in several key
sectors. Emphasising the need to devise an effective strategy for reducing the
incidence of industrial unrest, the plan document, among other things, stressed
that workers' participation in industry should be encouraged. The Seventh Plan,
states that there is a considerable scope for improvement in industrial
relations. It also maintains that effective participation of workers is one of
the important determinants of productivity.
However,
in the new twenty point economic programme, workers' participation scheme has
not been included. But in the 1987-88 budget, the Government considered the
workers' participation in equity and directed commercial banks to sanction loan
liberally to workers who wish to acquire shares of their own company.
4.
What are the
various approaches to participative management so far?
Ans. Organisations
use a variety of programs aimed at increasing employee participation. All the
different programs have one major objective and that is to increase employee
participation. However the programs differ with regard to the degree of direct
or indirect involvement, the influence they exert and the time length of the
program.
An organization
is said to be using participative management when it uses either a very
significant approach with widespread application or a sufficient number of programs
to develop a substantial sense of empowerment among its employees.
Participative management is basically a process where subordinates share a
significant degree of decision making with their immediate superiors.
The
different types of participative programs are :
1.
Works committees : The Industrial Disputes Act
of 1947 provides for establishing works committees in every establishment
employing hundred or more workers. This legislation thus makes it compulsory
for the organization to ensure employee participation. The work committee
consists of equal numbers of workers and employer.
The
employer’s representatives are nominated by the employer and should be those
who are connected wit the firm and have day-to-day contact with workers. The
workers representatives are elected from among the workmen engaged in the firm
in consultation with the union.
The
main function of the works committee is to promote measure for securing and
preserving amity and good relations between the employers and the workers. The
works committee is normally concerned with day-to-day problems of the firm.
Their task is to smooth away any friction that may occur between the management
and the workers.
Despite
the noble intentions of the Act, works committees have not been very successful
due to the following reasons :
a)
Workers representative are on these committees lack
the competent to carry out their responsibility well.
b)
Unions consider these committees as a threat to their
existence as employers prefer to talk to these committees rather than the
union.
c)
Some employers consider it below their dignity to sit
on these committees along with the workers.
d)
There is lack of interest among workers in works
committees as they concentrate only on minor issues and major issues pertaining
to wages, bonus, etc are not included.
2.
Co-partnership :
In
this method, employees are paid the share of profits in the firm of shares and
not cash. Thus workers become shareholders in the company in which they are
employed. Being shareholders of the company they are entitled to participate in
management. They also receive dividend on their shares. Co-partnership
increases the status of workers and improves their relationship with the
management.
The
problem with this method is that employees are not interested in co-partnership
and want their share of profits in cash and refuse to accept shares of company.
Even the unions oppose this scheme as well as they feel that nominal
shareholding of the workers does not give them any real say in management.
3.
Employee Directors :
Under
this method one or two representative of the workers are nominated on the board
of Directors of the company. They enjoy the same privileges and have the same
authority as other directors have. They participate in the decision making
process as regards policies and procedure. The representatives of the employees
to be nominated are selected or suggested by the unions of the employees. The
management of this method of participation is that many worker directors are
ignorant about their role on the board and get in to conflict with other board
members.
4.
Joint Management Councils (JMC) :
Under
this system, joint management councils are constituted. These councils consist
of equal number of representatives of employers and workers. The councils
discuss various matters concerning the working of the company. The decision of
that council is advisory in nature. The management however considers these
decisions sympathetically and implement them although it is not mandatory.
5.
Suggestion schemes :
As the name
itself indicates, suggestion programs are formal plans to invite individual
employees to make suggestions for work improvements. The suggestions are then
sorted out as per their applicability and cost-benefits ratio. Employees whose
suggestions result in cost saving for the organization are given monetary
rewards that are proportionate to the company’s savings. The limitations of
suggestion programs are :
a)
Employee initiative : The
emphasis is on individual initiative rather than group problem solving and
teamwork. Only a few employees make actual suggestions and the rest do not
experience any sense of involvement.
b)
Demoralizing : There is a possibility that
employees may be feel delay in the processing of suggestions or if certain
ideas that appear good are rejected. The employee may stop making suggestions
in the future.
c)
Criticism : Some managers find it hard to
accept suggestions from their subordinates and may view it as criticism of
their ability and practice.
6.
Quality Circles :
The
success of quality circles in Japan has led to their increasing popularity in
Europe and the United States. A quality circle consists of a group of employees
who meet regularly to discuss their quality problems, investigate causes,
recommend solutions, and take corrective actions. Quality circles usually
consist of eight to ten employees and supervisors who typically meet once a
week on company time and on company premises. The benefits of quality circles
are :
a)
Employees feel that they have some influence on their
organization.
b)
Quality circles provide opportunities for personal
growth, achievement and recognition.
c)
Employees are more committed to the solutions as they
generated them.
The
limitations of quality circles are :
a)
Not all employees participate. Some are just silent
spectators.
b)
They often address trivial and issues.
c)
Employees feel isolated if they feel that their
efforts are not having an impact on the organization.
7.
Total quality management :
TQM
or total quality management is a philosophy of management that aims at constant
attainment of customer satisfaction through continuous improvement of
all organizational processes.
TQM
is not a merely a quality improvement technique but rather a set of corporate
values-a way of life demonstrating a strong commitment to improving quality in
everything that is done.
TQM
gets every employee involved and every step in the firm’s process is subject to
intense and regular scrutiny for ways to improve it. Any issue may be taken up
for exploration.
For
TQM to be effective, employee must receive extensive training in problem
solving, group decision making and statistical methods.
8.
Self-managing Teams :
Self
– managing teams are sometimes referred to as semi-autonomous work groups or
socio-technical teams. Self – managing teams are natural work groups that are
given a large degree of decision-making autonomy; they are expected to control
their own behaviour and results. In simple words, self-managed teams are teams
whose members are permitted to make key decisions about how their work is done.
Typically,
self-managing teams consist of small numbers of employees, often around ten,
who take on duties that used to be performed by their supervisors. Their task
includes making work assignments, deciding on the pace of work, determining how
quality is to be assessed, and even who gets to join the team.
9.
Quality Circle – A Way of Participative Management :
Quality
circles pioneered by Dr K Ishikawa, in early sixties, helped Japanese Industry
to make a miraculous recovery from the ravages of the Second World War and
transforming its earlier image as producer of substandard products into leading
industrial nation with high productivity and reliable quality.
Quality
circles are small groups of employees that meet on a regular basis to discuss
ways in which they can improve productivity and cut costs. Generally a Quality
circle consists of about ten employees who meet on a regular basis voluntarily
for an hour or so to identify, analyse and discuss specific work -related
issues, which will lead to over all improvement in total performance and
enrichment of work life. The idea here is to meet at free period, generally
lunch hours or after the factory hours. The meetings are loosely structured and
often begin with a group of brain storming session to identify problem areas.
The
organizational structure of the quality consists of following parties :
a)
Non – members are those employees who are not the part
of the circle however they are very important for the implementation and
success of Quality Circles.
b)
Members are the employees who form the Quality
circles. The eligibility to become a member solely depends upon participation.
c)
Leaders! Deputy Leaders are chosen among the members
themselves on a rotation basis. Such convention would ensure leadership
building aspect of quality circles, as every member would have an opportunity
to lead the team.
d)
Facilitator is a senior officer of the department and
is nominated by the management. Outsiders are not appointed as facilitators.
e)
Departmental Committee / Steering Committee comprises
heads of major departments. Such involvement of the top management creates a
lot of confidence and commitment on the part of workers which leads to higher
productivity.
f)
Coordinating Agency coordinates the activities
of the circle throughout the organization.
Quality
Circles :
a)
Improve human relations and work area morale
b)
Promote participative culture
c)
Promote team work
d)
Improve overall productivity yet cost effective
e)
Satisfy the self esteem requirements of the employees
at the grass roots.
5.
Give a live
corporate example of WPM in any Indian Company.
Ans. There are many
companies who have embraced this particular style of management and are now
getting positive results. Toyota is the best example. The company has been
following suggestion schemes and employee involvement procedures for over a
decade now. The management receives almost 2,000,000 suggestions and ideas
every year and around 95 percent of these are implemented by the company. Who
is not aware of Toyota’s success rate? Around five thousand improvements per
year have made Toyota one of the fastest growing organizations globally. The
need is to develop and implement a comprehensive company policy and everything
works well.
British
Airways is another great example of participatory management. During economic
downsizing, employees’ suggestions helped them cut annual cost of their
operations by 4.5 million pounds. This is just unbelievable. The company would
have suffered from huge losses, had it not adopted employees’ suggestions. It is
right to some extent that employees can misuse industrial democracy but with a
proper management of HR functions, this problem can be solved and the
operations of organization can be taken to the next level.
Satyam
is another great example. It has been implementing company-wide suggestion
scheme, ‘The Idea Junction’, since 2001. A real-time web-based portal is
present in Intranet that can be accessed by all its employees all across the
globe to support the entire life cycle of an idea right from its generation
till its implementation. The main idea behind adopting this management style
was to create values and bring sense of belongingness in the employees through
ideas, suggestions and complaints. The whole procedure is backed by a strong
and comprehensive reward policy that encourages employees to perform better
each time.
Further
Cases in attached file “wcms_187873”
6.
State and
explain the various types of workers participation in management. Which one in
your opinion is the best?
Ans. Workers
participation may exist in all levels of management, however it may vary from
management to management. Participation of workers in management is more likely
at lower level and less involvement at top level of management. Broadly
speaking there are following file levels of participation of workers in
management.
1.
Information participation of workers: It ensures that
employees are able to receive information and express their views pertaining to
the matters of general economic importance.
2. Consultative participation of workers: Under this kind of workers participation in management, May act as a consultant in the matters of workers safety, health and their welfare at workplace. Even so, ultimate decision lie in the hands of management, only employees views are considered as advise.
2. Consultative participation of workers: Under this kind of workers participation in management, May act as a consultant in the matters of workers safety, health and their welfare at workplace. Even so, ultimate decision lie in the hands of management, only employees views are considered as advise.
3. Associative
participation of workers: This kind of workers participation
in management is next level to consultative participation. under associative
participation of workers in management, morally bound to accept and implement
the opinion of employees.
4.
Administrative participation of workers: Under this kind of participation
of workers in management, workers the part in discharge of managerial
functions. Here employees take part in decisions, which were already taken by the
management, thereupon employees have to select the best from those decisions
for the purpose of implementation.
5.
Decisive participation of workers: Decisive participation is the
highest level of workers participation in management, where employees and
management together taking decisions on the matters related to workers welfare
and production related issues.
7.
What do you
understand by bipartite forums? How do they promote WPM?
Ans. Bipartitism is a
system of industrial relations where social and labour issues are discussed
between trade unions and management, usually at the enterprise level. The
bipartite consultative machinery comprises two important constituents, viz.,
the works committees and the joint management councils. These are purely consultative
and not negotiating bodies. This consultative joint machinery- with equal
representation of the employers and the workers has been set up exclusively for
dealing with disputes affecting the plant or industry.
Evolution
of Such Bodies
The
importance of bipartite consultative machinery was first recognized as early as
in 1920, when a few joint committees were set up in the presses controlled by
the Government of India. They were also introduced in Tata Iron and Steel
Company at Jamshedpur. The importance of bipartite consultation was further
highlighted by the First-Five-Year Plan which maintained: “There should be the
closest collaboration, through the consultative committee at all levels,
between employers and employees for the purpose of increasing production,
improving quality, reducing cost and eliminating waste,” The second Plan also
stressed the need for “joint consultation and progressively associating the
workers and technicians, wherever possible, in management.
Bipartite Bodies
The
two important constituents of bipartite consultative machinery are Works
Committee and Joint Management Councils. A brief review of these bodies is
given here
Works Committees
In
the case of any industrial establishment in which one hundred or more workmen
are employed or have been employed on any day in the preceding twelve months,
the appropriate Government may by general or special order require the employer
to constitute in the prescribed manner a Works Committee consisting of
representatives of employers and workmen engaged in the establishment so
however that the number of representatives of workmen on the Committee shall
not be less than the number of representatives of the employer. The
representatives of the workmen shall be chosen in the prescribed manner from
among the workmen engaged in the establishment and in consultation with their
trade union, if any, registered under the Indian Trade Unions Act,1926 (16 of
1926).
It
shall be the duty of the Works Committee to promote measures for securing and
preserving amity and good relations between the employer and workmen and, to
that end, to comment upon matters of their common interest or concern and
endeavor to compose any material difference of opinion in respect of such
matters.
Joint Management Council
If
in respect of any industry, the state Government is of opinion that it is
desirable in public interest to take action under this section. It may, in the
case of all undertakings or any class of undertakings in such industry, in
which five hundred or more employees are employed or have been employed on any
day in the proceeding twelve months, by general or special order, require the
employer to constitute in the prescribed manner and within the prescribed time
limit a Joint Management Council, consisting of such number of members as may
be prescribed, comprised of representatives of employers and employees engaged
in the undertaking, so however, that the number of representatives of employees
on the Council shall not be less than the number of representatives of the
employers. Notwithstanding anything contained in this Act, the representative
of the employees on the Council shall be elected in the prescribed manner by
the employees engaged in the undertaking from amongst them:
Provided
that a list of industries in respect of which no order is issued under this
sub-section shall be laid by the State Government before the State Legislature
within thirty days from the commencement of its first Session of each year. One
of the members of the Council shall be appointed as Chairman in accordance with
rules made in this behalf.
The
council shall be charged with the general duty to promote and assist in the
management of the undertaking in a more efficient, orderly and economical
manner, and for that purpose and without prejudice to the generality of the
foregoing provision, it shall be the duty of the Council to promote cordial
relations between the employer and employees; to build up understanding and
trust between them; to promote measures which lead to substantial increase in
productivity; to secure better administration of welfare measures and adequate
safety measures; to train the employees in understanding the responsibilities
of management of the undertaking and in sharing such responsibilities to the
extent considered feasible; and to do such other things as may be prescribed.
The
Council shall be consulted by the employer on all matters relating to the
management of the undertaking specified in sub-section (1) and it shall be the
duty of the council to advice the employer on any matter so referred to it.
The
Council shall be entrusted by the employer with such administrative functions,
appearing to be connected with, or relevant to, the discharge by the Council of
its duties under this section, as may be prescribed.
8.
Elaborate upon
the role of WCs, JMC, and workers representatives on the BOD of various forums.
Ans. Works
Committees: WCs
is the first stage of the industrial relations machinery. A WC is part of the
process of joint consultation with in an enterprise. These committees generally
deal with questions of health, training, discipline, welfare and safety and
changes in production methods, but are not usually concerned with wages and
conditions of employment which are negotiated with the trade unions. The
committees' functions are normally advisory rather than executive. The
functions of a WC include promotion of good relationship, resolving differences
of opinion and act as an advisory body. A survey undertaken by the chief Labour
Commissioner (Central) in PSUs in 1959 has shown that in approximately 60 per
cent of the undertakings, decisions reached in WC meetings were usually
unanimous and in nearly 48 per cent of the undertakings, as many as 90 per cent
of the decisions arrived at were implemented within a reasonable time.
Theoretically speaking, the WC consisting of representatives of employers and
workers envisaged by the Industrial Disputes Act, 1947 is the first symbolic
step in the direction of development of ID. The WCs are bipartite in composition
and comprise an equal number of representatives of the employer and workmen
engaged in an enterprise. One is convinced that this in turn will depend upon
the extent to which the measures of adaptation that are necessary one
recognised and adopted with the assent of a workforce whose representatives are
involved equally and from the beginning in the processes of decision-making. Any
workman of not less than 19 years of age and with not less than one year
service in the enterprise may, if nominated in the prescribed manner, be a
candidate for election as a representative of the workmen on the WC. The
continuous service of not less than a year in two or more enterprises belonging
to the same employer is deemed to satisfy the prescribed service qualification.
The members of the WCs are elected for a term of two years. The WCs were to be
constituted with equal representation from management and workers. The workers
representatives were to be chosen from among the workers in consultation with
the registered trade unions operating in the enterprises concerned. Later, the
scope and responsibilities of the WC were enlarged to include safety measures,
workers' welfare, recreation, festivals, holidays, administration of welfare
funds, health and other work amenities. The WC has among its office-bearers a
chairman, a vice-chairman, a secretary and a joint-secretary. The chairman is
nominated by the employer from amongst the employer representatives on the WC.
Wherever possible the chairman should be the head of the enterprise. The
Vice-chairman is elected by the workers members of the 1 works committee from
amongst themselves. The structure and relations of WCs in the enterprises are
presented in Figure II. After independence the Government of India made
provisions for setting up of WCs under the Industrial Disputes Act, 1947 (i).
The items that a WC normally deals with, are (1) conditions of work, (2) safety
and accident prevention, occupational diseases and protective equipment, (3)
amenities, such as drinking water, canteens, dining rooms, rest rooms, medical
and health services, (4) adjustment of festival and national holidays; (5)
administration of welfare and fire funds, (6) educational and recreational
activities and (7) promotion of thrift and savings. The items specially
excluded from the functions of a works committee are (1) wages and allowances,
(2) Bonus and profit sharing bonus, {3) rationalisation and matters connected
with the fixation of work load, (4) programmes of planning and development, (5)
matters connected with retrenchment and long, (6) victimisation for trade union
activities, (7) provident fund, gratuity schemes and other retirements
benefits, and (8) housing arid transport services. These WCs are. Bipartite in
composition and comprise an equal number of representatives of the employer and
the workmen engaged in an enterprise. The WCs may meet often as necessary, but
not less than once in three months. These committee meetings should be held
during the working hours of the company on any working day and the matter
should also be notified with all details on company notice board.
Joint Management
Councils: The
labour management co-operation seminar of 1953 discussed the problems related
to the setting up of JMCs, but in the next two years, only 24 JMCs were set up
and a second seminar in 1960 found that the councils had not made much headway.
In pursuance of recommendations of second seminar, the Government constituted a
tripartite committee on labour management co-operation to advice on setting up
of JMCs. The third plan again re-affirmed the importance of JMCs. On 31st
January and 1st February, 1957, in a seminar held at Delhi which was attended
by the representatives of the employers, employees, and the Government, a model
agreement was drawn up with regard to the constitution, functions and
administration of the JMCs.
The
nature, composition and functions of the JMC is a tripartite body in
composition, consisting of workers, management and Government representatives.
The structure of these councils took a concrete shape following' draft model
agreement emerging out of a tripartite meeting between the representatives of
the Government, labour and trade unions at the fifteenth session of the Indian
Labour Conference (ILC) held in 1957. The important function of any procedure
in joint relationships in the exchange of information and opinions between
management and work people. The structure and relations of the scheme of Joint
Management council is presented in the Figure-II.2. The Third Five-Year Plan
reiterated the policy of participation of workers in management and stated that
the “scheme of JMCs will be progressively extended to new industries and units so
that it may become a normal feature of the industrial "system". The
successful joint councils requires: i) method of establishment of joint
council, ii) co-operative of trade unions, iii) adequate representation of
workers, iv) continuous co-operation of workers, v) an effective publicity
drive about councils work, vi) dealing of councils with problem? vii) proper
proceedings of meetings? viii) education and training both management and
workers representatives, as well as the state? ix) right attitude and proper
climate of co-operation? x) single strong trade union in an undertaking.
Some conditions for successful JMCs in
his study: i) both management and labour should have co-operative attitude
towards each other and positive attitude to consultation? ii) the workers must
have sound, base at unionism? iii) joint consultation should be set up not by
force or persuasion? iv) there should be clear demarcation of functions between
JMCs and in other agencies.
Representation of
workers on board of directors: Government of India has recently taken
a decision with regard to workers' participation in the board of directors of
the PSUs and it is a great leap forward in the direction of ID. It gives status
and prestige to the workers, preserves and promotes industrial harmony and
helps in creating a favourable climate for better labour-management relations.
The Government of India has recently introduced, on an experimental basis, a
scheme in the matter of appointing workers1 representatives on the board of
management in 1 two PSUs, viz., Hindustan Antibiotics Ltd., Pimpri, Poona,
Hindustan Organic Chemicals Ltd., Kblaba. Hindustan Shipyard Ltd., at
Visakhapatnam and Fertiliser Corporation of India's plant at Sindri (PS) and
D.C.M. (Private sector) have all tried this concept. The implementation of the
scheme of workers' participation on board of management in PEs though in
operation since 1971, has not been successful. The practice of nominating a
worker-director was introduced in some PSUs in 1971 and later in the nationalised
banks sipce 1973.
The
concept of employee directorship is acceptable to all the groups involved. But
the scheme has not been successful in developing a congenial relationship based
on mutual trust, respect understanding, and cooperation. It has little positive
impact on the industrial relations climate or on the decision making of the
board. There seems to be a need to develop positive attitudes among chairman,
managing directors as well as workers' directors, officer directors toward the
need and importance of workers' participation. They may need orientation and
skill development for greater participation to make the structure really i
operative. Participation does not stop with mere sitting of the workmen's
representatives on the board of management. Its aim is broader. Workers'
participation in decision may take place at all levels, but workers
representation on board of directors has particular significance, it is an
offer or an opportunity to influence fundamental policy decisions. There are
also stray examples of appointing worker directors on the boards of PSEs. A
statutory support for the induction of worker directors on boards of all
companies employing 1,000 or more workmen was recommended by the High power
Expert Committee on companies and MRTP Acts.1 2 The High Power Expert Committee
on companies and Monopolistic Restrictive Trade Practices (MRTP) Act, 1978
suggested the appointment of workers' directors to start with, in companies
employing 1,000 people; and disclosure of company information to worker
directors; and special training programmes for them to enable them to
participate completely in decision making as members of the board. In India,
for instance, there is a strong difference of opinion between the Government
and the parliamentary public undertakings committee on the question whether
workers' representatives on the boards of management of PSUs should be elected
by the workers or nominated by the ministry 2 concerned. The recognised union
of the company to submit a panel of three names from whom one person is to be
selected for nomination as director. A person who is to be selected for
nomination as director, and to be eligible for nomination should have five
years service in the undertaking and should not attain the age. of superannuation
during his terra 1 of appointment as a director. The Administrative Reforms
Commission (ARC), 1969 in its report on PSUs, recommended that the
representatives of the workers should be included on the board of directors of
the public undertakings. This recommendation was accepted as a model of
participation. Now it is being followed by some undertakings like Bharat Heavy
Electricals Limited (BHEL) and also in nationalised banks. The ARC in this
connection observed: ".... we are inclined to take the view that it is
only after further improvements have been made in workers' rights and more
systematic and comprehensive use has been made of a wide range of joint
determination within an enterprise in its day to day activities that statutory
representation of workers in management of companies. Whether at the top
(board), middle (executive management) or lower (shop floor) levels can be
considered. Before any attempt is made to provide for statutory representation
of workers at any desired level in company management, efforts should be made
to improve the education and training of workers for some of the elementary
task of management. Even with regard to the boaKF^ifel participation, the
Administrative Ministries have been requested to work out details in
consultative with the Department of Labour and to identity enterprises where it
is possible to introduce this scheme at board level. WPM is now realised as
full fledged participation by workers only to ensure highest level of
participation in management. This highest level of participation can help to
bridge the gap between labour and management to understand various problems. An
uneducated worker is unable to understand policy decisions and hence the
management should cooperate with those workers. In Indian conditions, it is
felt that WPM may not succeed unless participative training, historical or
traditional support to working class, economic background, psychological
cultural and social background of the society are not improved. In our country
itself attempts have been made to introduce participation at the board level in
some of the PSUs. In a few undertakings the board level participation seems to
have made some headway while in a majority of others this exercise has not been
successful. While reasons are plethora for the failure of board level
participation in India, one of the reason seems to be the inadequate calibre of
the labour representatives nominated for the board of directors. However, there
is a practical problem. A director has to shoulder the responsibility to act in
the best interests of the company as a whole which a worker director may find
conflicts with his commitment to represent the employees. The worker directors
have no effect on the decision-making process, because the board is not really
the place where they work.
One
of the main objections to worker directors is that the employee representative
becomes isolated once he reaches the board room and the door closes behind him.
It is unusual for managers to weaken the position of employee representatives
deliberately, but when it happens there is the risk that the employees
repudiate the representative seen as being in the management's pocket and seek
other representation, usually outside any understood and spread out procedures.
One of the means proposed to the Donovan Commission by the Trade Union Congress
to increase WPM was the introduction of legislation to allow the companies to
make provision for trade union representation on board of directors.
In
1973 representatives of wprkers were associated as members on the management
board of nationalised Banks. In 1971, as an extension of this concept of WPM an
effort was made to associate workers representatives as members of the board of
directors especially in PSEs. while communists themselves were not keen on the
scheme of WPM, Mr. Y.B.Chavan, the then Union Finance Minister rushed through
an amendment to Banking Regulations Act, introducing employee directors on the
boards of nationalised banks representing both workmen and other officer
employee categories. Thus the nationalised Banks pioneered in this regard.
9.
Short Note on Shop
Councils & Joint Councils:
Ans. In 1975 the
Government suggested another scheme for participation of workers at the shop
floor and plant levels through the shop and joint councils respectively,
covering manufacturing and mining units in the public, private, and cooperative
sectors as well as those run departmentally and employing 500 or more workers.
WPM in Industry at shop and plant levels (the Appendix-V). The present shop and
joint councils are the modified version of the JMCs to suit the philosophy of
the 20 point economic programme. A feature of the scheme is that there is no legal
sanction. Further it provides that the shop councils should be set up at shop
and floor levels and joint councils at plant level. In 1956, the Government of
India sent abroad a ten-member study group consisting of the representatives of
employees, employers and the Government. The study group recommended for the
setting of joint councils in the selected units. In January-February, 1958 a
seminar was held at New Delhi. To assess the working of the joint councils, the
second seminar was held in March, 1960. On the recommendation of this seminar a
special unit was set up in the Ministry of Labour and Employment to deal with
the matter of this scheme. This new scheme of workers' participation in India,
in the management at the shop floor level is an indication of the ceaseless
endeavour and inclination of the country to bring about ID. The above scheme
was well received by the concerned undertakings and encouraged by its general
acceptability. The Government of India in January, 1977 extended the scheme to
commercial and service organisations as well as to those run departmentally.
The
objective of the scheme of shop and joint councils has been to provide
institutionalised forums for communication and consultation between workmen and
management at both shop and plant levels with a view to generating a climate of
mutual trust and confidence necessary for increasing production and promoting
industrial harmony. The scheme was formulated by the Government in pursuance of
the 20 point economic programme. The labour officers of the central pool were
issued special instructions to take initiative and advise the managements to
constitute shop councils and joint councils and also render them all possible
assistance to ensure that the scheme achieved its objectives. The basic
objective has been to make provision for the investigation and settlement of
disputes at the plant level itself with a view to promoting measures for
securing and preserving amity and good relations between the employers and
workmen and, to that and, to comment upon matters of their common interests or
concern and endeavour, to compose any material difference of opinion in respect
of such matters. , The term of shop and joint councils is generally two years.
However, the practice in some undertakings is different. For instance, in
Indian Drugs and Pharmaceuticals Limited (IDPL) the council once formed shall
function for a minimum period of one year. In Electronics Corporation of India
Limited (ECIL) the term of representatives of workers has been fixed only for
six months. The main features of the joint council suggest that the chief
executive of the unit shall be the chairman of the joint council and the tenure
of the council once formed would be for a period of two years. Every decision
of the joint council shall be taken on the basis of consensus and not by a
process of voting. The decision once taken shall be binding on employers and
workmen and shall be implemented within one month unless otherwise stated in
the decision itself. The joint council shall deal with the matters pertaining
to optimum production, efficiency and fixation of productivity norms of man and
machines for. the unit as a while; to deal with matters which remain unresolved
at the SC, decide on matters concerning the unit or a plant as a whole and deal
with general health, welfare, and safety measures for the unit or the plant.
Workers' representation in shopfloor and plant level, forums covers the main
categorial of worker including first-line supervisors, but excludes managerial
staff. Both workers and management get equal representation in these forums.
As
regards the progress of participatory schemes, it may not be out of content to
mention that by the end of March, 1977, in all 543 PS and departmental
enterprises of the Central Government had either constituted shop and joint
councils or had taken steps to implement the scheme. Out of a total of 543
enterprises, 425 had constituted both shop and joint councils while 12 had
constituted either shop or joint councils and there were 81 enterprises which
had attempted to make alternative arrangements. In 25 organisations the scheme
was at the formulation stage. The .State-wise activities to implement the
scheme of shop and joint councils by the end of February 1977, as reported to
the U nion L abour Ministry by the State Governments, suggested that in all 1,369
enterprises spread all over India had implemented the scheme of shop and joint
council and 99 units made alternative arrangements. The major functions of the
SCs have been stated, among other things, to improve productivity and
profitability of the enterprise; assist management in achieving monthly/yearly
production targets; study absenteeism in the shops, and departments and
recommend steps- to reduce them; assist management in maintaining general
discipline in the shop or department; improve conditions of work and ensure
safety, health and welfare of the workers and to establish an adequate two-way
communication between the management - and workers particularly on matters
relating to production schedules and progress in achieving in the target. It has
been emphasised that all decisions in the shop council shall be taken on the
basis of the consensus.
10. Short Notes:
a. QCs
Ans. A quality circle
is a volunteer group composed of workers , usually under the leadership of
their supervisor , who are trained to identify, analyze and solve work-related
problems and present their solutions to management in order to improve the
performance of the organization, and motivate and enrich the work of employees.
When matured, true quality circles become self-managing, having gained the
confidence of management.
Participative
management technique within the framework of a company-wide quality system in
which small teams of (usually 6 to 12) employees voluntarily form to define and
solve a quality or performance related problem. In Japan (where this practice
originated) quality circles are an integral part of enterprise management and
are called quality control circles.
"A Quality Circle is volunteer
group composed of members who meet to talk about workplace and service improvements
and make presentations to their management with their ideas." (Prasad,
L.M, 1998).
Quality
circles enable the enrichment of the lives of the workers or students and
create harmony and high performance. Typical topics are improving occupational
safety and health, improving product design, and improvement in the workplace
and manufacturing processes.
These
are related especially to the quality of output or services in order to improve
the performance of the organization / department and motivate and enrich the
work of employees. This group carries on continuously as a part of
organization-wide control activities, self and mutual developments and control
and improvement within the workplace utilizing quality control techniques with
all the members participating. Generally six to twelve volunteers from the same
work area make up a circle. The members receive training in problem solving,
statistical quality control and group processes. Quality Circle generally
recommends solutions for quality and services which may be implemented by the
management. Thus Quality Circle is not merely a suggestion system or a quality
control group but extends beyond that because its activities are more
comprehensive. Furthermore, it is not a taskforce because it can be made a
permanent feature of the organization or a department.
History
o Pioneered by
Japanese.
o Japanese
nomenclature: Quality Control Circles (QCC), generally now known as Quality
Circles (QC) or some call it as Small Group Activity (SGA).
o 1962: First QC
Circle was registered with QC Circle Head Quarters in Japan.
o 1974: Lockheed
Company, USA started Quality Circle movement.
o 1977:
International Association of Quality Circles (IACC) was formed in USA.
o 1980: BHEL,
Hyderabad first in India to start Quality Circles.
o 1982: Quality
Circle Forum of India (QCFI) was founded.
"Chorei"
is a common morning meeting ritual in Japanese organizations. Each work day
begins with a meeting where employees stand in a circle and share their day's
work agenda or project status. Chorei is a cultural export in the expanding
global economy. Practitioners of chorei believe this type of meeting technique
can help improve communication resulting in better productivity.
There
are various forms and styles of participative management. One of them which is
widely applied and practised is ‘Quality circles’. The ‘quality circle’ concept
first originated in USA which was very successfully applied in Japan
afterwards. This technique boosted the Japanese firms to endeavour for high
quality products at low costs.
Objectives
of Quality Circle
The
perception of Quality Circles today is 'Appropriateness for use1 and the tactic
implemented is to avert imperfections in services rather than verification and
elimination. Hence the attitudes of employees influence the quality. It
encourages employee participation as well as promotes teamwork. Thus it
motivates people to contribute towards organizational effectiveness through
group processes. The following could be grouped as broad intentions of a
Quality Circle:
1.
To
contribute towards the improvement and development of the organization or a
department.
2.
To
overcome the barriers that may exist within the prevailing organizational
structure so as to foster an open exchange of ideas.
3.
To
develop a positive attitude and feel a sense of involvement in the decision
making processes of the services offered.
4.
To
respect humanity and to build a happy work place worthwhile to work.
5.
To
display human capabilities totally and in a long run to draw out the infinite
possibilities.
6.
To
improve the quality of products and services.
7.
To
improve competence, which is one of the goals of all organizations.
8.
To
reduce cost and redundant efforts in the long run.
9.
With
improved efficiency, the lead time on convene of information and its
subassemblies is reduced, resulting in an improvement in meeting customers due
dates.
10.
Customer
satisfaction is the fundamental goal. It will ultimately be achieved by Quality
Circle and will also help to be competitive for a long time.
Benefits
of Quality Circles
There
are no monetary rewards in the QC’s. However, there are many other gains, which
largely benefit the individual and consecutively, benefit the business. These
are:
·
Self-development: QC’s assist
self-development of members by improving self-confidence, attitudinal change,
and a sense of accomplishment.
·
Social development: QC is a
consultative and participative programme where every member cooperates with
others. This interaction assists in developing harmony.
·
Opportunity to attain knowledge: QC members have
a chance for attaining new knowledge by sharing opinions, thoughts, and
experience.
·
Potential Leader: Every member gets a chance
to build up his leadership potential, in view of the fact that any member can
become a leader.
·
Enhanced communication skills: The mutual
problem solving and presentation before the management assists the members to
develop their communication skills.
·
Job-satisfaction: QC’s promote creativity by tapping
the undeveloped intellectual skills of the individual. Individuals in addition
execute activities diverse from regular work, which enhances their
self-confidence and gives them huge job satisfaction.
·
Healthy work environment: QC’s
creates a tension-free atmosphere, which each individual likes, understands,
and co-operates with others.
·
Organizational benefits: The individual
benefits create a synergistic effect, leading to cost effectiveness, reduction
in waste, better quality, and higher productivity.
All
these benefits are lasting in nature, which bring about progress over a period
of time.
b. TQM
Ans. Total Quality
Management is a management approach that originated in the 1950s and has
steadily become more popular since the early 1980s. Total Quality is a
description of the culture, attitude and organization of a company that strives
to provide customers with products and services that satisfy their needs. The
culture requires quality in all aspects of the company’s operations, with
processes being done right the first time and defects and waste eradicated from
operations.
Total
Quality Management, TQM, is a method by which management and employees can
become involved in the continuous improvement of the production of goods and
services. It is a combination of quality and management tools aimed at
increasing business and reducing losses due to wasteful practices.
Some
of the companies who have implemented TQM include Ford Motor Company, Phillips
Semiconductor, SGL Carbon, Motorola and Toyota Motor Company.
TQM is a
management philosophy that seeks to integrate all organizational functions
(marketing, finance, design, engineering, and production, customer service,
etc.) to focus on meeting customer needs and organizational objectives.
TQM
views an organization as a collection of processes. It maintains that
organizations must strive to continuously improve these processes by
incorporating the knowledge and experiences of workers. The simple objective of
TQM is “Do the right things, right the first time, every time.” TQM is
infinitely variable and adaptable. Although originally applied to manufacturing
operations, and for a number of years only used in that area, TQM is now
becoming recognized as a generic management tool, just as applicable in service
and public sector organizations. There are a number of evolutionary strands,
with different sectors creating their own versions from the common ancestor.
TQM is the foundation for activities, which include:
·
Commitment
by senior management and all employees
·
Meeting
customer requirements
·
Reducing
development cycle times
·
Just
in time/demand flow manufacturing
·
Improvement
teams
·
Reducing
product and service costs
·
Systems
to facilitate improvement
·
Line
management ownership
·
Employee
involvement and empowerment
·
Recognition
and celebration
·
Challenging
quantified goals and benchmarking
·
Focus
on processes / improvement plans
·
Specific
incorporation in strategic planning
This
shows that TQM must be practiced in all activities, by all personnel, in
manufacturing, marketing, engineering, R&D, sales, purchasing, HR, etc.
Principles of
TQM
The
key principles of TQM are as following:
Management Commitment
·
Plan
(drive, direct)
·
Do
(deploy, support, participate)
·
Check
(review)
·
Act
(recognize, communicate, revise)
Employee Empowerment
·
Training
·
Suggestion
scheme
·
Measurement
and recognition
·
Excellence
teams
Fact Based
Decision Making
·
SPC
(statistical process control)
·
DOE,
FMEA
·
The
7 statistical tools
·
TOPS
(Ford 8D – team-oriented problem solving)
Continuous
Improvement
·
Systematic
measurement and focus on CONQ
·
Excellence
teams
·
Cross-functional
process management
·
Attain,
maintain, improve standards
Customer Focus
·
Supplier
partnership
·
Service
relationship with internal customers
·
Never
compromise quality
·
Customer
driven standards
The Concept
of Continuous Improvement by TQM
TQM
is mainly concerned with continuous improvement in all work, from high level
strategic planning and decision-making, to detailed execution of work elements
on the shop floor. It stems from the belief that mistakes can be avoided and
defects can be prevented. It leads to continuously improving results, in all
aspects of work, as a result of continuously improving capabilities, people,
processes, technology and machine capabilities.
Continuous
improvement must deal not only with improving results, but more importantly
with improving capabilities to produce better results in the future. The five
major areas of focus for capability improvement are demand generation, supply
generation, technology, operations and people capability.
A
central principle of TQM is that mistakes may be made by people, but most of
them are caused, or at least permitted, by faulty systems and processes. This
means that the root cause of such mistakes can be identified and eliminated,
and repetition can be prevented by changing the process.1
There
are three major mechanisms of prevention:
1.
Preventing
mistakes (defects) from occurring (mistake-proofing or poka-yoke).
2.
Where
mistakes can’t be absolutely prevented, detecting them early to prevent them
being passed down the value-added chain (inspection at source or by the next
operation).
3.
Where
mistakes recur, stopping production until the process can be corrected, to
prevent the production of more defects. (stop in time).
Implementation Principles
and Processes
A
preliminary step in TQM implementation is to assess the organization’s current
reality. Relevant preconditions have to do with the organization’s history, its
current needs, precipitating events leading to TQM, and the existing employee quality
of working life. If the current reality does not include important
preconditions, TQM implementation should be delayed until the organization is
in a state in which TQM is likely to succeed.
If
an organization has a track record of effective responsiveness to the
environment, and if it has been able to successfully change the way it operates
when needed, TQM will be easier to implement. If an organization has been
historically reactive and has no skill at improving its operating systems,
there will be both employee skepticism and a lack of skilled change agents. If
this condition prevails, a comprehensive program of management and leadership
development may be instituted. A management audit is a good assessment tool to
identify current levels of organizational functioning and areas in need of
change. An organization should be basically healthy before beginning TQM. If it
has significant problems such as a very unstable funding base, weak
administrative systems, lack of managerial skill, or poor employee morale, TQM
would not be appropriate.
However,
a certain level of stress is probably desirable to initiate TQM. People need to
feel a need for a change. Kanter (1983) addresses this phenomenon be describing
building blocks which are present in effective organizational change. These
forces include departures from tradition, a crisis or galvanizing event,
strategic decisions, individual “prime movers,” and action vehicles. Departures
from tradition are activities, usually at lower levels of the organization,
which occur when entrepreneurs move outside the normal ways of operating to
solve a problem. A crisis, if it is not too disabling, can also help create a
sense of urgency which can mobilize people to act. In the case of TQM, this may
be a funding cut or threat, or demands from consumers or other stakeholders for
improved quality of service. After a crisis, a leader may intervene
strategically by articulating a new vision of the future to help the
organization deal with it. A plan to implement TQM may be such a strategic
decision. Such a leader may then become a prime mover, who takes charge in
championing the new idea and showing others how it will help them get where
they want to go. Finally, action vehicles are needed and mechanisms or
structures to enable the change to occur and become institutionalized.
TQM
encourages participation amongst shop floor workers and managers. There is no
single theoretical formalization of total quality, but Deming, Juran and
Ishikawa provide the core assumptions, as a “…discipline and philosophy of
management which institutionalizes planned and continuous… improvement … and
assumes that quality is the outcome of all activities that take place within an
organization; that all functions and all employees have to participate in the
improvement process; that organizations need both quality systems and a quality
culture.”
c. Employee Stock-Option
Ans. Stock options
give employees the right to buy a number of shares at a price fixed at grant
for a defined number of years into the future. Options, and all the plans
listed below, can be given to any employee under whatever rules the company
creates, with limited exceptions in various countries.
This
involves making the worker’s shareholders of the company by inducing them to
buy equity share.
It involves
employees’ participation in the share capital of a company in which they are
employed. By virtue of their being shareholders, they have the right to
participate in the management of the company. Shares of the company can be
acquired by workers making cash payment or by way of stock options scheme. The
basic objective of stock options is not to pass on control in the hands of
employees but providing better financial incentives for industrial
productivity.
In
many cases, advances and financial assistance in the form of easy repayment options
are extended to enables employees to buy equity shares. Examples of this method
are available in the manufacturing as well as in the service sectors.
Advantages:
Makes the workers committed to the job and to the organization
Drawback:
Effect on participation is limited because ownership and management are two
different things.
Employee stock option plans are a
mechanism to allow employees to acquire shares at favourable conditions,
generally subject to certain conditions and restrictions, e.g. the employee
must be employed by a member of the MNE group for a certain period of time,
there is a minimum period between the moment the option is granted and the
moment it is exercised, and/or between the exercise of the option and the sale
of the shares that have been subscribed to or acquired, granting and/or vesting
of the options under some plans is subject to specified performance and
motivation-based criteria being satisfied. The underlying shares may be listed
or not. They may be shares in the employer or shares in another company of the
MNE group (usually the parent company).
Stock option plans can be classified
under two broad categories: “dilutive” stock option plans whereby options are
met by allowing employees to subscribe for previously unissued shares in a
company (e.g. to a capital increase) on favourable terms, and “non dilutive”
stock option plans whereby options are met by providing for the possibility of
employees acquiring existing shares on similarly favourable terms.
Some stock option plans permit the
employee holding the option to elect to receive cash equal to the spread
between the strike price and the share price as of the date of exercise, rather
than receiving shares in exchange for payment of the strike price. As a
practical matter, a stock option plan with such a cash-settlement feature, when
the employee elects to receive cash rather than shares, may be difficult to
distinguish from a share-based remuneration arrangement involving Phantom
Stocks or Stock Appreciation Rights.
From an individual taxation perspective,
employees benefiting from the plan may or may not benefit from favourable
regimes. From a corporation tax perspective, in some cases, a tax deduction may
be allowed to either or both the employer of the employee and to the provider
of the employee options (usually the parent company), while in other cases no
deduction is allowed for corporation tax under domestic rules.
Two or more broad types of stock option
plans may exist in some MNE groups (e.g. one for "executive
employees", another for "general employees", and / or a separate
plan for CEOs and other senior management within the MNE group). There may not
be a single group-wide plan having common features irrespective of the
jurisdiction in which an employee is located, but rather a series of plans
within the MNE group with each individual plan tailored to the specific needs
of an associated enterprise, or to the regulatory, tax and other legislative
requirements of members of the MNE group operating in a particular country.
Common forms of structuring (e.g. the
use of trusts or Special Purpose Companies to acquire and hold shares until
provided to employees) and financing arrangements (e.g. where debt is used to
purchase existing shares) can be adopted by MNE groups in relation to their
share-based remuneration schemes, including stock option plans.
Finally, stock option plans (as well as
some other forms of share-based remuneration described in Sub-section B.3 (b)
(i) below) might in certain cases have a role as a possible defence to a
hostile take-over or as part of a management buy-out.
From the standpoint of Article 9 of the
MTC, only plans operated by MNE groups and their possible impact on the
commercial and financial relations between associated enterprises and the
possibilities for relieving double taxation under paragraph 2 of Article 9 and
the Mutual Agreement Procedure in Article 25 of the MTC are concerned.
Hereafter we shall consider both non-dilutive stock option plans that allow
employees to purchase existing shares and dilutive stock option plans that
enable them to subscribe to new issues, irrespective of whether they are
accompanied by favourable domestic tax provisions or not.
UNIT III
11. Describe the structural arrangements of
Participative Management.
Ans.
12. Explain the various levels in WPM.
Ans. Workers participation may exist in all
levels of management, however it may vary from management to management.
Participation of workers in management is more likely at lower level and less
involvement at top level of management. Broadly speaking there are following
file levels of participation of workers in management.
1. Information
participation of workers: It ensures that employees are able to receive
information and express their views pertaining to the matters of general
economic importance.
2. Consultative participation of workers: Under this kind of workers participation in management, May act as a consultant in the matters of workers safety, health and their welfare at workplace. Even so, ultimate decision lie in the hands of management, only employees views are considered as advise.
2. Consultative participation of workers: Under this kind of workers participation in management, May act as a consultant in the matters of workers safety, health and their welfare at workplace. Even so, ultimate decision lie in the hands of management, only employees views are considered as advise.
3. Associative
participation of workers: This kind of workers participation in
management is next level to consultative participation. under associative
participation of workers in management, morally bound to accept and implement
the opinion of employees.
4.
Administrative participation of workers: Under this kind of participation
of workers in management, workers the part in discharge of managerial
functions. Here employees take part in decisions, which were already taken by
the management, thereupon employees have to select the best from those
decisions for the purpose of implementation.
5. Decisive
participation of workers: Decisive participation is the highest level of
workers participation in management, where employees and management together
taking decisions on the matters related to workers welfare and production
related issues.
13. How important is the role of external and internal
factors in influencing the levels of WPM?
Ans. Workers’
participation in Management in India was given importance only after
Independence. Industrial Disputes Act,1947 was the first step in this
direction, which recommended for the setting up of works committees. The joint
management councils were established in 1950 which increased the labour
participation in management. Since July 1975 the two-tier participation called
shop councils at shop level and Joint councils were introduced. Workers’participation
in Management Bill, 1990 was introduced in Parliament which provided scope for
up liftment of workers.
Reasons for
failure of Workers participation Movement in India:
Employers
resist the participation of workers in decision-making. This is because they
feel that workers are not competent enough to take decisions.Workers’
representatives who participate in management have to perform the dual roles of
workers’ spokesman and a co-manager. Very few representatives are competent
enough to assume the two incompatible roles.Generally Trade Unions’ leaders who
represent workers are also active members of various political parties. While
participating in management they tend to give priority to political interests
rather than the workers’ cause.Schemes of workers’ participation have been
initiated and sponsored by the Government.However, there has been a lack of
interest and initiative on the part of both the trade unions and employers.In
India, labour laws regulate virtually all terms and conditions of employment at
the workplace. Workers do not feel the urge to participate in management,
having an innate feeling that they are born to serve and not to rule.The focus
has always been on participation at the higher levels, lower levels have never
been allowed to participate much in the decision-making in the
organizations.The unwillingness of the employer to share powers with the
workers’ representatives, the disinterest of the workers and the perfunctory
attitude of the government towards participation in management act as stumbling
blocks in the way of promotion of participative management.
Measures for
making Participation effective:
Employer
should adopt a progressive outlook. They should consider the industry as a
joint endeavor in which workers have an equal say. Workers should be provided
and enlightened about the benefits of their participation in the
management.Employers and workers should agree on the objectives of the
industry. They should recognize and respect the rights of each other.Workers and
their representatives should be provided education and training in the
philosophy and process of participative management. Workers should be made
aware of the benefits of participative management.There should be effective
communication between workers and management and effective consultation of
workers by the management in decisions that have an impact on
them.Participation should be a continuous process. To begin with, participation
should start at the operating level of management.A mutual co-operation and
commitment to participation must be developed by both management and labour.
Modern
scholars are of the mind that the old adage “a worker is a worker, a manager is
a manager; never the twain shall meet” should be replaced by “managers and
workers are partners in the progress of business”
Forms of
workers’ participation in management
The various
forms of workers’ participation in management currently prevalent in the
country are:
Suggestion schemes: Participation of workers
can take place through suggestion scheme. Under this method workers are invited
and encouraged to offer suggestions for improving the working of the
enterprise. A suggestion box is installed and any worker can write his
suggestions and drop them in the box. Periodically all the suggestions are
scrutinized by the suggestion committee or suggestion screening committee. The
committee is constituted by equal representation from the management and the
workers. The committee screens various suggestions received from the workers.
Good suggestions are accepted for implementation and suitable awards are given
to the concerned workers. Suggestion schemes encourage workers’ interest in the
functioning of an enterprise.
14. Short Notes:
a.
National level
WPM
At the level of
the industry or economy, there often exist relatively formal schemes of joint
consultation or "worker participation. Industry association
representatives often meet labor union representatives to discuss various
matters relating to industry performance, prospects, and policy issues. The
government offices in charge of particular industries often organize formal
meetings where both management and labor representatives attend and discuss
various issues of common interest. This kind of conference or meetings are also
organized at the level of total industry or economy, either with or without
government representatives. They discuss and share information on more macro
economic and industry issues and also macro labor conditions.
The complex
system of worker participation and information sharing of various forms and at
various levels has served the purpose of moderating shocks of economic changes
and provided more room for both management and workers to prepare to adapt such
changes. With cooperation of workers, companies, and industries have been able
to adjust wages and working hours more flexibly, thereby maintain employment
more stably. This has been beneficial both to industry and economy with a
long-term perspective, and to workers in the sense of assuring them employment
security.
b.
Corporate level
WPM
In a large
corporation, there usually exists a formal system of joint consultation, where
union leaders and top corporate executives participate and discuss a broad
range of issues relating economy, industry, and management prospects sharing
relevant information. The JC is held regularly, say monthly or several times a
year.
Worker
participation of various forms at various levels has contributed greatly to
promote productivity and quality improvements at the workshop, company and
industry. Productivity improvement has been attained through both cost-cutting
and introducing new technologies. Quality improvement has been attained by
increasing care and control of workers and also implementing new production
methods. In either case, the most critical was the understanding, sharing of
goals, and active and responsible involvement of workers. Increased
productivity and improved quality of products contributed not only to
management but also to workers in the form of higher wages and security of
employment.
15.
Short Notes:
a.
Plant level WPM
The system and
the way it operates are basically comparable to the one at the corporate level,
except that in this case, representatives of both labor and management are from
within the plant, and the scope of issues discussed is more geared to plant
specific topics.
The plant
council was formed in pursuance of the recommendations of the second meeting of
the Group of Labour at New Delhi in 1985. The scheme was made applicable to all
central public sector undertakings, except those, which are given specific
exemption from the operation of the scheme the government.
b.
Zonal level WPM
c.
Shop level WPM
The system of
worker participation tends to be less formal, but more closely related to
issues of the workshop. Topics to be discussed are more closely tied to
day-to-day problems such as transfer, job assignment, training, holidays, shift
systems, etc. Workshop union committee men and first-line supervisors play
critical roles in resolving workshop issues through de facto joint
consultation.
There are more
informal forms of worker participation at the workshop. Workers voices are
heard and reflected in day-to-day decision making at the workshop. This kind of
function is played through a variety of channels: sometimes through informal
groups, other times through QC (Quality Circle) activities, and still other
occasions through interactions among workers, first-line irregular small
meetings and personal consultations at the workshop. Through such activities,
many problems-ranging from working conditions to production methods which
directly affect individual workers are consulted, discussed, and resolved.
UNIT
IV
16. Elaborate upon the experience of Indian PSUs
and private sectors. Highlight the variation, if any.
17. Illustrate the participation of workers in
Management Bill, 1990.
Ans. Separately Attached.
18. Do you think there is a scope for improvement
for WPM in Indian Companies? If yes, put forward your suggestions.
Ans. Workers’ participation
in Management in India was given importance only after Independence. Industrial
Disputes Act,1947 was the first step in this direction, which recommended for
the setting up of works committees. The joint management councils were
established in 1950 which increased the labour participation in management.
Since July 1975 the two-tier participation called shop councils at shop level
and Joint councils were introduced. Workers’participation in Management Bill,
1990 was introduced in Parliament which provided scope for up liftment of
workers.
Reasons
for failure of Workers participation Movement in India:
Employers
resist the participation of workers in decision-making. This is because they
feel that workers are not competent enough to take decisions.Workers’
representatives who participate in management have to perform the dual roles of
workers’ spokesman and a co-manager. Very few representatives are competent
enough to assume the two incompatible roles.Generally Trade Unions’ leaders who
represent workers are also active members of various political parties. While
participating in management they tend to give priority to political interests
rather than the workers’ cause.Schemes of workers’ participation have been
initiated and sponsored by the Government.However, there has been a lack of
interest and initiative on the part of both the trade unions and employers.In
India, labour laws regulate virtually all terms and conditions of employment at
the workplace. Workers do not feel the urge to participate in management,
having an innate feeling that they are born to serve and not to rule.The focus
has always been on participation at the higher levels, lower levels have never
been allowed to participate much in the decision-making in the organizations.The
unwillingness of the employer to share powers with the workers’
representatives, the disinterest of the workers and the perfunctory attitude of
the government towards participation in management act as stumbling blocks in
the way of promotion of participative management.
Measures
for making Participation effective:
Employer
should adopt a progressive outlook. They should consider the industry as a
joint endeavor in which workers have an equal say. Workers should be provided
and enlightened about the benefits of their participation in the
management.Employers and workers should agree on the objectives of the
industry. They should recognize and respect the rights of each other.Workers
and their representatives should be provided education and training in the
philosophy and process of participative management. Workers should be made
aware of the benefits of participative management.There should be effective
communication between workers and management and effective consultation of
workers by the management in decisions that have an impact on
them.Participation should be a continuous process. To begin with, participation
should start at the operating level of management.A mutual co-operation and
commitment to participation must be developed by both management and labour.
Modern
scholars are of the mind that the old adage “a worker is a worker, a manager is
a manager; never the twain shall meet” should be replaced by “managers and
workers are partners in the progress of business”
19. Compare and contrast WPM in India and abroad.
Ans. The formal system of
participative management in India is through the constitution of various
committees with the representatives of workers and management. However, a few
employers consider the formation of these committees as an imposition on their
freedom to run their own business in their own way. Many union organisations
are of the opinion that workers themselves should solve their problems through
their organisations’ strength and collective bargaining. They consider these
committees as their rivals or substitutes and blame employers’ attitude as the
main hurdle in the successful and smooth functioning of these committees.
It is
the need of the time that, both employers and workers representatives should
come forward, join hands and make the functioning of various committees a grand
success. For this purpose, employers should do everything possible to enable
these committees function properly and provide them adequate facilities and
financial assistance, workers’ representatives should be leave on full pay to
attend committee meeting and adequate remuneration be given for attending
committee meeting beyond working hours. Relevant information and documents be
made available at regular intervals. Proposals forward by these committees
should be given due weightage and its implementation be reported back to them.
Committee meetings should be called regularly, no indiscriminate action be
taken against active workers representatives in any form.
Workers
representatives should not do any thing, which comes in the way of these
committees, smooth functioning. Commercial financial or technical secrets
should not be leaked out. Constant touch be kept with the fellow workers and
they should be adhered to extraneous issues should not be raised. Whole-hearted
support is extended to these committees. Workers should be made to realise the
important role that the committees can play in reducing industrial conflicts.
Problems coming in the way of these committees be brought to the notice of workers
and educate them how beseech these be solved in the interests of all concerned
parties.
The
experience of 21 countries with regard to their implementation of various
participative schemes has been briefly surveyed in this section of study. In
Sweden, ‘joint enterprise council’ is the form of employee participation in
management. The German model of participation is called ‘co-determination’.
‘Trade unions’ and ‘workers’ collectives’ share managerial responsibility in
Russia whereas; the Yugoslavian experiment of ‘self management’ has been a
unique model of participation. ‘Union-management co-operation through
collective bargaining’ has been the system of employee involvement in
decision-making in the United States of America. In the United Kingdom, trade
unions are represented in the board of directors. The Israeli model of
participation ‘Kibbutz’ has attracted world wide attention due to its peculiar
features. Japanese industries are known for its labour friendly small group
activities such as ‘Kaizen’, ‘Quality Circle’ etc. ‘Management committees’ with
representatives of employer and employees are common in France. ‘Self
management’ system of participation in Poland has been peculiar in many
respects. Besides, countries like Congo, Mali, Benin, Egypt, Iraq, Luxembourg,
Venezuela, Algeria, Canada, Norway, and Zambia have their own systems of labour
participation in management. Most of the European countries have highly
structured participative management process, and in many cases it is mandated
by law (Beach, 1980). The structure, content and form of participative
management depend on the ideology and system adopted by a particular society
(Monappa, 1987).
Further
notes in attached file “14_chapter 4”
20. What do you think is the future of WPM?
Explain.
Ans. Sustainability of the
participative processes: Once the challenge of competition loses momentum as
companies gear up fully and achieve success as competitors, will the need for
comprehensive employee involvement continue? We have already seen a considerable
degree of dilution in participative processes from that envisaged by the
stakeholders in the 1960s and 1970s, with the recent emphasis on
performance-related processes and lowerlevel work-related decisions, especially
in the private sector. This may gradually transform participation into a
peripheral intervention. As several Indian companies go multinational, they may
switch from employee involvement to more MNC-oriented policies. Some of the
multinational companies operating in India have no employee-friendly policies
or practices or democratic management styles at all. Is it possible that Indian
MNCs too will get into the mould of highly competitive entities and put
performance above everything else? Joint forums in Indian companies may also
acquire greater orientation towards production, productivity and
quality-related practices and not HR, manpower and employee satisfaction issues
in existing or newer forums. The issue of employee development remains
nebulous. Even where employees did have direct access to participation in the
organizations among the six cases studied (Jayashree Textiles, M&M, BPCL
and Acclaris), no employee commented categorically on their own development as
human beings. When this question was posed specifically, most replied that
there was more work satisfaction or that they had more access to information.
Only in UBI did both employee representatives on the board say their
participation had helped them mature as individuals.
The
issue of WPM was important for involving workers in the production process. It
would also empower them to make independent decisions and be more confident
about their own capabilities. Most of the schemes in the developed
industrialised countries of Europe gave much more opportunities to workers to
get involved in different aspects of management, including planning sales
targets, marketing, and improving labour productivity. In fact, many
specialists have commented that the successes of these countries were due to
WPM.
WPM in
India was not even half as inclusive as its European counterparts. Most of the
schemes were restricted to merely helping boost productivity and maintaining
discipline. Objectively, when unions and workers realised that their only
contribution lay in ensuring industrial harmony and nothing else, they lost
interest in these schemes.
Earlier
studies conducted by the Institute of Public Enterprises in Hyderabad had found
that in different participatory bodies, the worker representatives were much
better prepared for the meetings, but the management representatives were
casual and appeared not to take these bodies seriously.
This
shows that the schemes of WPM had created a lot of enthusiasm in the working
class. They saw in it a means of participating in the future of their company.
Their hopes were soon belied when they found that neither government nor
management gave these bodies the importance they deserved.
The fact
that schemes for WPM were not statutory requirements made matters worse because
it was not mandatory for employers to allow WPM. By the 1970s, it was not
surprising to find that there were less than a hundred instances of WPM in the
public sector. The number fell drastically after 1985.
It was
said that the public sector was different from the private sector because
everyone from top to bottom was an employee and not an owner. This has been
reiterated by public sector managers in many forums and seminars on the
subject.
At the
same time, senior officials were wary of allowing workers to participate beyond
issues relating to discipline and productivity. Their excuse was that many of
these issues involved decisions which were confidential and should not be known
to the rivals or they were too technical for workers to understand. Hence,
workers could not be trusted nor did they have the competence of dealing with
areas that included decision making and policy strategies.
Therefore,
it should not be believed that just because people were employees, they would
all be treated as equals. In the private sector, there may be a vested interest
of owners who would like to keep their ownership rights intact and not share
these with workers or others. At the same time, the issue is not just of
ownership but more so of power.
Public
sector officials who boast that they are not owners but employees are highly
conscious of the power that they wield. Hence, just as families controlling
private enterprises do not want to share authority with the workers and other
officials, those in the top echelons of the public sector too show similar
tendencies of not sharing with the workers the authority they enjoy due to
their positions.
We find
that the lure of power is the main issue that prevents effective WPM. This
could also be because we have inherited a feudal system that refuses to accept
as equal with the rest those that are defined as being in lower positions.
Perhaps the influence of the caste system has a bearing on such attitudes.
The
rigid hierarchy of this system that has existed for several centuries has had a
long-lasting effect on our society, despite the changes taking place. The caste
system believes in exclusion of the lower class because they are ‘impure’;
similarly, we rigidly believe that workers too need to be excluded from
managerial practices because of their low status.
Multi-unionism
is another factor that goes against the interests of participation. In India we
have a large number of trade unions operating in a single factory or workplace.
The infighting among unions can hamper WPM. Some public sector undertakings try
to overcome this by having secret ballot for election to the different
committees.
The
union getting the highest (above fifty per cent) of votes becomes the
representative. In other undertakings, such as Bharat Electronics, the top two
unions are taken as representative. This does not prevent other unions from
wielding their power. The Industrial Disputes Act allows any union to raise any
issue relating to work. This union, even though a minority, can take up issues
of workers in the labour office and the courts. We do not have a system of
determining the representative union.
Following
are a couple of links for MCQs:
https://wps.pearsoned.com/durai_hrm/154/39672/10156128.cw/index.html
https://studylib.net/doc/15039826/chapter-15-employee-involvement--multiple-choice-questions
https://www.avatto.com/ugc-net-exam/commerce/mcqs/ugc-net/questions/443/5.html
http://www.simplynotes.in/industrial-relations-mcqspractice-questions-unit-5/4/
https://studylib.net/doc/15039826/chapter-15-employee-involvement--multiple-choice-questions
https://www.avatto.com/ugc-net-exam/commerce/mcqs/ugc-net/questions/443/5.html
http://www.simplynotes.in/industrial-relations-mcqspractice-questions-unit-5/4/
Comments
Post a Comment