BUSINESS INDIA

Synopsis: Communication For Productivity Letters written to some 7500 Workers / Managers / Union Leaders, following a period of strike / Go slow / Murders (1979 - 1987), at Mumbai factory of Larsen & Toubro Ltd. This direct / open / honest communication led to a remarkable atmosphere of trust between Workers and Management, which, in turn, increased productivity at 3% per year (ave).

18 Dec 1984

To:

Dear Friends

I recently came across the following piece  of information in 'Business India' - (November 1984).

"An  Indian industrial  worker  has to  work  more than twelve times  as long as  his U.S. counterpart  to earn enough to buy  the same basket of  food, according to a survey published in Geneva.

A U.S. factory  employee can earn enough to  buy a kilo of meat,  a  litre of  milk, 500  grams of  bread, plus fish, butter,  potatoes, sugar and oranges  in one hour 50 minutes -  but his Indian equivalent has  to work 22 hours 38 minutes to buy the same things".

Is this not terrible? - that  L&T-ties at Powai, have to work so much  longer than  the American workers,  to buy  the same quantity?

Have you ever wondered why?

I will tell you why!

This  is  because  Indian workers  who  are  producing  these things  are  very  inefficient and  unproductive I  They  are taking  too much time  to produce the  milk and  the meat and the bread  and the  sugar and all  those other  things'. They are not working  fast enough and  smart enough!  So naturally their  cost of production  is  high -  making  their products expensive.'

And to be able to buy  these expensive products, we need more money.  And  to earn more money  we need to work  longer than our American friends.

So far we  talked about our having to  work longer - but what about others who buy L&T products?

Do they  also have to work  longer to buy our  switchgear and our cement plants  and our dairy equipment  because these are very expensive?

And why are  these very expensive?  Because we  take too many hours to produce these?

Perhaps we will  never know, because  there is  hardly an L&T product which  is purchased by the  common man  on the street (except perhaps our MK Starter which  is bought by the Indian farmer for his pumping set).

And the  industrialist who purchases  our equipment  does not have to  "complain" to  us about  our high  cost.  He  has an option to buy it from other companies - at a lesser cost!

Would you like to know the productivity of the Indian Worker? Here area  few examples :

1.   STEEL

In   our  steel-factories,   one   worker  is   able   to manufacture 60 'tons of steel in one year.

in Japan, one  worker produces 200 tons  of steel in the same time!

2.   TEXTILE

One Indian worker produces  3 tons of textile (cloth)  in one year.

A Japanese worker produces 10 tons of cloth in one year!

3.   SUGAR      An Indian worker produces 24 tons of sugar in a year.     

An American? 430 tons!

4.   RICE      in India, one hectare produces 1870 kgs of rice.     

In Korea one hectare produces 6780 kgs.

And these are 2/3 years old figures!

No wonder Mr. Chandrakant Kirloskar is worried!

At one place in the following article he writes,

"In  Japan, 125  men manufacture  20,000  pumps  and here  in India  (in Kirloskar's  own  factory  at  Devas) as  many  as 750 persons manufacture only 10,000 pumps.  What a contrast?"

So when  it comes  to manufacturing  pumps, the  Japanese are 12 times more productive than us !

To find out why, please read the following article.

H.C. PAREKH