Cynosure Cockpit Assembly

Introduction The major problem the company faces in 2010 is about handling their Staff, who are raising the issue of Increment and In-Equality in salary and this issue was strongly brought to notice through HRM management to the company. This happens because of the zero annual increment for the year 2009 and meager increment in the year 2010 for Staff Technicians due to Global Economic Downturn. Cynosure Plant Cynosure is a multinational auto major, and leading global supplier of electronics and technologies for automotive , commercial vehicle and other market segment. The company operated major research and development centers, manufacturing sites and customer support facilities in over 30 countries. Through innovation, dedication and commitment to the customers, Cynosure had established a reputation as one of the Worlds Premier automotive suppliers. Employees worked together with shareholders to accomplish their vision. Financial Challenges Faced by the company The company had been facing variety of challenges, including ever-increasing Raw material cost, Thin profit margin, Increased intensity of competition, etc., raw material represented about 40% of cost to produce an assembly, and copper was an essential ingredient in the mix. The copper had largely raised and reached its historic high and happens few months before global financial crisis. Another disturbing factor of the economy of Cynosure are increase in rate of vehicle loan further compounded the problems and Global Economic Downturn that set its foothold in late 2007.

Global Economic Downturn The global Economic downturn that began in late 2007 took the entire world economy by grips by mid 2008 only to become stronger in2009. Growth of World trade decelerated to 4.3% in 2008, from6.4 in 07. The World output dropped from 3.9% to 1.9% in 08 and -2.2% in 2009.

These cause Global automobile enterprises to have cost cuts to survive. Those cost cuts were lay-offs, plant closures temporary shutdowns, reduction in remuneration, drastic reduction ins subcontracting, cut backs in overheads and non-urgent expenditures, efficient use of raw materials etc.,This also affected in India too. Cynosure was also hit hard by the global financial crisis. This causes the decision of reducing headcount and pressure to right size itself. Problems in Cynosure Plant. The Cynosure India Plant faces most of the problems in the field HRM headed by Mr.Sanjay. He finds out many minute and major problems that arises in his department one of the problem he finds increase in cost of staff attrition due to relocation of plant raises 18%. The plant had the a very progressive work culture and a strong belief about developing internal capabilities. So whenever business warranted additional headcount, the employees from within were given preference over external candidates. Hence, the plant saw a good number of internal placements happening including the movement from shop floor associate to office staff. Internal Placement policy The plant had a firm policy and a well-established procedure for effectuating the internal placement from shop-floor associate to staff. The procedure of Internal Placement includes the following steps: 1.Initiation of the headcount request by Head of the department basis of needed business plan. 2.Approval by the plant head 3.Screening and personal interview of eligible employees. 4.Recommendtion for internal placement. This policy had helped the plant in keeping the moral of the associates high. The shopfloor associate turned staff members constituted the sizable proportion of the staff. They were largely given the position of technician, data controller, customer support executives etc., And as a group called as Technicians (Technicians Herein after) and in 2007 19 people of shop-floor were placed as technicians. Performance Management System(PMS)

The responsibilities for the technicians were expanded and handles lot of technical activities. In 2008, they were subjected to the new HR policies meant for the staff, wherein there was no room for overtime pay, productivity etc. Furthermore the basis of hike in compensation got changed from Union Settlement to the rating achieved in Performance Management System(PMS). The PMS carried out by the respective supervisors, consisted of three phases viz. 1.Initia Goal Setting 2.Mid-Term performance review 3.Final- performance review. In the last phase, the final rating was given basis which the percentage of increment used to be decided. According to the policy the technicians were given an average hike of 13% each year. And increment of 13% causes the salary increment to 15085/- per month in Feb 2008 for technicians.

Causes of Problem Due to Global economic crisis the i.e., Financial meltdown, decline in sales causes the Cynosure to take a decision of Zero Increment Year and implement globally to all its branches though few of its companies shows little improvement. As the situation worsens further for the next year, the company was compelled to reduce increment to 5% than promised increment of 13% for the year 2010.So the salary of the technicians increased to 15840/- per month The staff floor associates having more than 14 years experience who comes under Union Settlement Body and excluded from new HRM policies enjoys the latest Union Settlement increases their salary to 2350/- per month and also includes many monitory benefits like Monthly attendance award of 750/-, Productivity award etc., causes even increase in salary to 2600/- also. As the Technicians are comparatively higher in cadre than shop-floor associates and earns lesser than them as they are valuated through PMS and could not enjoy any other

benefits like full attendance etc., all these automatically leads to distress, moral value reduction, conflicts and inequality among them.

. Therefor Mr.Sanjay had gone through various reports and came through suggestion of increasing the increment.

These are the findings from case study Suggested approach. Refer pics