OD & CHANGE - Exercise

Scenario
1. Site A manufacturing textiles has been existed since 1950 as part of an
international group.
2. Being a manufacturing house for more than 0 !ears it has a reputation of
being a "aluable place to #or$.
%. Since the business has been gro#ing the Site has had technolog!
impro"ement #ith the follo#ing ob&ecti"es'
(ualit! impro"ement to be able to compete in international mar$ets.
)mpro"e *ost *ompetiti"eness.
+ess dependence on labour.
,. A large number of labour emplo!ed at the Site ha"e organi-ed them as a
strong labour union. .his labour union has been successfull! negotiating on
#or$ers/ emplo!ment terms and conditions as #ell as benefits.
0ith continuous negotiations #ith the management on re"ising emplo!ment
terms and increasing benefits of #or$ers result has been'
1igher salaries and benefits to #or$ers.
+abour union becoming stronger and challenging management.
2rerogati"es
5. .his has resulted into'
1igh labour cost.
3roding management authorit!
+o#ering producti"it!.
.hus all this leads to cost pressure and competiti"eness challenge.
. .here has been a recent change in the labour legislation allo#ing outsourcing
of manufacturing ser"ices. .his #ould mean that no# emplo!ers can re4
structure their manufacturing models b! mo"ing to#ards contract emplo!ment
s!stems. .his #ould further mean less permanent emplo!ees and reliance on
contract emplo!ees.
5. 6anagement of Site A "ie#s this legislati"e change as an opportunit! to
reduce permanent emplo!ment base and mo"ing to#ards contract emplo!ment
s!stems b! outsourcing. .he! expect the follo#ing benefits #ith this change'
7educed strength of labour union.
8etting bac$ management authorit!.
9lexibilit! in utili-ation of people at the shop floor.
7educed people cost.
1
2roducti"it! impro"ement.
:. 6anagement of the Site A o"er a period of 1241: months under a ne#
manufacturing strateg!'
Bringing in the most modern technolog! #hich #ould reduce dependence on
manpo#er.
*ategori-ing the #hole factor! &obs into'
o *ore and
o ;on < *ore
*ore' Being directl! related to manufacturing needing s$ills to be able to perform
;on < *ore' Being the ones #hich are not directl! related to manufacturing and
technical s$ills are not re=uired to perform.
9. 0ith the strateg! in place the management #or$s out the si-e of the
permanent labour force that #ill be needed and ho# man! #ill become
surplus. .hen the! ha"e dialogue #ith the labour union and separate around
55> of the permanent labour force.
10. 0ith the ne# manufacturing model in place management feels =uite relie"ed
as the! see t#o main benefits'
+abour union/s strength reduced.
6anagement prerogati"es bac$.
11. .his s!stem remains in practice for 54: !ears and management gets used to
#or$ing in a more authoritati"e #a! #ith nearl! no challenge from the labour
unions and #or$ force. 2eople #or$ing through &obs loo$ at the management
team members as &ob pro"iders and are #illing to do an!thing on the shop
floor to $eep them pleased. 9urther? during this period the management builds
more of autocratic st!le of #or$ing.
12. After around : !ears of pressure of labour unions in the countr! and )+@? the
go"ernment re"ises the la# stating that people #ho ha"e been #or$ing in
manufacturing for more than % !ears on a &ob #ill be ta$en through
recruitment process and offered permanent ser"ices. .his change in the la#
#ould mean around ,00 people at Site A to be permanent.
1%. .his #ould mean all these ,00 people becoming member of the #or$ers/
union.
1,. 0hilst management is happ! to bring in this change of offering permanent
&obs as the business has been gro#ing manufacturing facilities ha"e expanded
and technolog! is #ell embedded as part of manufacturingA the! see challenge
more to#ards beha"ioural part of both ne# permanent #or$ers and
management #ho are used to #or$ #ith authorit! and #ith hard approach.
15. 6anagement/s further concern is to ensure that this change from non
permanent to permanent emplo!ment is transitioned smoothl! #ith no
2
disruption in production? no producti"it! and efficienc! less as this #ould put
further cost pressure #hich the! can/t afford.
1. Beeping this big change in the management? an @C *onsultant #ith onl! one
ob&ecti"e explained
D9rom non permanent to permanent emplo!ment in big numbers to be transitioned in
a smooth manner #ith no discipline and building collaborati"e management st!le.
0hilst carr!ing out this exercise
)dentif! current leadership as #ell as management st!le.
*urrent #or$ culture at the shop floor.
*urrent beha"iours of management and #or$ers.
*hanged beha"iours of'
o 0or$ers
o Enion
Beha"ioural fear of management.
1o# #ill !ou approach this in stepsF
3xpectation from u is to attempt this as a consultant? going in step b! step? using @C
G *hange theories? diagnostic steps G tools? coming up #ith inter"entions Hho# and
#hen to go aboutI and #hilst choosing inter"entionJs do identif! #hich of the
categories of inter"entions thisJthese belong to and #h! and #ith #hat expected
results thisJthese are proposed for implementation.
01J12J2010
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