Synopsis: Communication For Productivity
Letters written to some 7500 Workers / Managers / Union Leaders, following a period of strike / Go slow / Murders (1979 - 1987), at Mumbai factory of Larsen & Toubro Ltd. This direct / open / honest communication led to a remarkable atmosphere of trust between Workers and Management, which, in turn, increased productivity at 3% per year (ave).
25 Feb 1987
INTRODUCING-THE CAPITALIST EMPLOYEES
What would you do If your company was making losses year after year or It's profitability was declining year after year ?
1. Started ................ 1943
2. Promoter ................ Kamani Group
6. No.of Employees ................ 1300
3. Accumulated losses of Rs.74 lakhs (upto 1976-77).
Enter the DOCTOR
· Expanded Wage-structure
· Improper Methodology of working
· LOW PRODUCTIVITY
So Mr.Kavadia did some plain-speaking (polite but blunt) to the patients - 1500 of them - all the employees of the company.
d) Increased number of working hours per day.
g) Froze Increments for 5 years !
* The shares are held by an employees co-operative society and cannot ' be sold In the open market. When an employee resigns or retires, his share In the society is transferred to other employees. So the share-holding remains Intact.
"The main reason for the success of the organisation is not that the employees are now participating in the management of the"affairs of the company. The main reason seems to be the employees' stake in the stake of the company. There is a feeling of ownership amongst the employees and that seems to have a much better effect than all the talk of low productivity and economic crisis.
The employees chose the first alternative and they are proud of having made the right choice at the opportune time".
· Sllverised Brass strips (planned)
MORAL OF THE STORY
In order to become profitable once aqain, must companies necessarily go through cancer-like sickness and bitter medicine (or even surgery - operation)
Can they actually take advance action of offering tonic to its employees in the form of "shares" to prevent the sickness ?
I am not sure that giving shares to our employees, by Itself, will help; us to get rid of all our problems. (Remember KOOR INDUSTRY of Israel ?)
To cure ourselves of our "high manufacturing costs", I am afraid some bitter medicine may have become Inevitable, and If our ECONOMY DRIVE does not prove to bo a strong enough medicine, we must soon think of other !