Sunday, January 1, 2017
Below is a fictionalized case study that presents dilemma faced in real organizations. And written by me is the recommended solution to the problem. This has been published in Business Manager Magazine October 2016 edition.
Aravind Engineering Company is one of the largest engineering and manufacturing enterprises in India. It is engaged in the production of heavy electrical equipment like heavy boilers, and power generation and transmission equipment. This company is well known for its high quality products and it exports a significant portion of its production. The workforce strength of this company is 12,500, of which nearly 60 per cent of the employees are in the age group of 40 and above. The company has a strong union presence as nearly 80 per cent of its workforce is unionized. The HR department of the company is headed by Mr Mithun, a post graduate in HR with a law degree. This company has an appreciable HR policy that offers the best compensation packages for the employees. It also offers adequate training and development and career opportunities to its workforce.
However, the only sore point among the otherwise excellent HR practices of this company is the slightly high level of industrial accidents occurring in the factory premises. The company has reported an average injury and illness rate of 6.2 per 100 employees, while the industry average remains at 4.8. Based on this criterion, the safety management policy of the company is deemed to be inadequate and ineffective. Obviously, the management wants the HR department to adopt rigorous safety practices to scale down the injury and illness rate to a level that is less than the industry average in a cost-effective manner.
Although the HR department is more than willing to introduce a comprehensive safety regulation by introducing new safety devices, apparatus and procedure, it faces several problems. The unionized employees are bent on opposing the new safety provisions for several reasons. In fact, the earlier safety initiatives by the HR department failed miserably due to the noncooperation of the employees and their trade unions. The unions feel that any compliance with the new safety regulations would force them to spend 10 minutes extra time. These employees are not prepared to spend any extra time for safety matters. They also feel that the handling of safety devices could slow down their productivity and performance, which, in turn, could affect their earning capacity. The traditional work culture of this company, which accords top priority to productivity over safety, is also making matters difficult for the HR department to introduce changes in the safety regulation. The safety training programmes conducted by the HR department in the past did not serve any purpose as the employees continued to exhibit an intransigent attitude towards safety regulations and flouted safety norms. Ironically, the employees are satisfied with the existing norms and apparatus and do not mind the injury rate and record of the company.
Quite understandably, the HR manager is perplexed over the strange situation. He is at a loss to know what needs to be done in the future to convince the employees, especially the union members, to accept the additional safety features. With the deadline, fixed by the management, for introducing the revised safety regulation fast approaching, the HR manager is in a real tight spot.
1. How do you assess the safety problems of Aravind Engineering?
The safety problems of Aravind Engineering can be summarized as follows;
a) The company has a strong union presence as nearly 80 percent of its workforce is unionised. Hence incase the management of the company wants to bring in some changes w.r.t. Labour, chances are that it will face strong resistance from the union who constitute more than ¾th of the workforce. Hence they have a strong collective bargaining power incases wherein they wish to oppose the management's decision. It is also seen in current context in the form of resistance by them when the HR department wishes to introduces new safety measures.
b) It also seems that there is an indifference in attitude exhibited by the unionized employees who are opposed to changes for their betterment. They are exhibiting a closed mindset by saying that new safety regulations would force them to spend 10 minutes extra at work for which they are not prepared at any cost. They feel that by way of handling of new safety devices could slow down their productivity and performance which in turn would affect their earnings. Giving priority to daily earnings / wages over safety which is for long term work benefit and longetivity shows lackdaisal attitude on part of the unionized employees.
c) It also does not help that the traditional work culture at Araving Engineering Company driven by the Leadership accords top priority to productivity over safety that makes matters difficult for the HR department to introduce changes in the safety regulation. The HR department can only do as much as it is empowered to do. If the focus of the company management is on revenue and production at any cost, then it will override any change management initiative that the HR department will introduce as the employees are only concerned about production and revenue and growth. It also does not help that Aravind Engineering is a market leader in production of heavy electrical equipment and as such all employees are working in their comfort zone knowing that they are currently unchallenged and hence why bother with changes and new initiatives when things are working well.
d) Another example of this indifferent attitude exhibited by the unionized employees towards introduction of new safety measures for their betterment is the fact that the company has reported an average injury and illness rate of 6.2 per 100 employees whereas the industry average is 4.8. This data should set the alarm bells ringing since the company is lagging behind in meeting the industry norms for safety. In order to overcome this, the HR department conducted various safety training programmes. However they were not effective as the employees continued to exhibit an intransugent attitude towards safety regulations and flouted safety norms. The employees showed satisfaction with the existing norms and apparatus and did not mind the injury rate and record of the company.
2. Who should be held accountable for the present state of affairs?
Ultimately, it should be the Leadership or Management who are ultimately responsible for the outcome of the introduction of new safety measures and in convincing the employees at Aravind Engineering, especially the union members, to accept the additional safety measures. If things don't work out as expected, it's not the responsibility of the HR Manager or anybody else. All roads lead back to Management of Aravind Engineering. They have to take an active role.
Management must ensure that these things happen. This can be done by reviewing the outcomes with HR and by way of assistance in resolving hinderances faced. It cannot be just delegated to HR and make them responsible and accountable.
Management should communicate to all it's employees as to how important safety is for the company and why it's critical for them to adhere to the regulations required. This communication requirement can only be fulfilled by them. This cannot be delegated. Management by communicating the importance of safety directly are endeavoring in giving the message that the actions of HR are real and that they believe it and all others involved should also believe in it too. This may also make the work of HR easier when implementing the changes because employees will then feel more motivated and will participate more actively. Buy-in will be ensured from the employees.
3. Had you been the HR Manager, how would you have handled the situation?
The HR Manager could have handled the situation better by engaging in more dialogue with them. A careful assessment of their concerns, their particular issues could have been done and solutions on it provided in consultation with them. The HR Manager prior to implementing the changes should walk everyone through the proposed changes in safety, why they are being implemented and why it is safe. The HR Manager by drawing upon past implementation experience of such measures and likely reactions of the employees could have anticipated the objections the employees will have this time around and thus be prepared to address them by validating their concerns and emphasizing the benefits of change. By planning, the HR Manager would have been better equipped to address objections head on.
By enlisting active support of the Management of Aravind Engineering as stated above and thus driving home the message that the company is serious about the changes to be introduced in the way safety norms and regulations are currently practiced and it's not just another routine act of HR that can be ignored assuming that things will remain the same.
Since communicating the importance of safety is the key – how it is currently practised and what needs to change, visual posters communicating the importance of safety may be displayed across the company at various locations. This will create safety awareness amongst all levels of employees and thus reinforce the message.
Rewards and Recognition Programmes can be introduced for best practices in following safety exhibited by the employees. Employees who show adherence to the new safety measures may be recognised and rewarded by the Management. This may serve as a motivation and incentive for other employees to also adopt the changes and thus vie for the R&R.
Employees who have switched over to the new safety norms, their services can be enlisted, to speak to others in their group about the importance of safety and how by switching over to the new safety measures has benefitted them. Once the employees hear from one of their own about the benefits, they may be more inclined and willing. Resistance to change will be less.
Aravind Engineering can also look at applying for Safety honors or awards in the industry like 'British Safety Council Award' or 'Sword of Honor Award'. By applying for the award, the company will be competing against others who have also applied and will thus come to know as to where it stands in the industry vis a vis the best safety practices followed. Should Araving Engineering were to win an award, it will get recognition in the industry. The award won would also serve to boost the morale of the employees and incentivise them to perform better and also maintain the safety standards for which the award is bestowed to the company.