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T
he era of rapid liberalisation and opening up of Indian doors to the global industrial market set rolling by Dr.Manmohan Singh, has made the existing Indian industry sit up and do soul searching within themselves. This is more so because the new MNC players have a strategic edge vis-a-vis financial muscle, brand equity, access to latest technology and an already global presence. Although they may not have marketing and sales networks of their own within India, this gets taken care of. The area where they need to tighten up their belts is the operational efficiency of their manufacturing set-ups. This is where they would like to have the cutting edge, be it in terms of capacity utilisation to optimum levels or manoeuvrability and flexibility to customer needs or quality products. In the past, many organisations launched individualoriented productivity schemes where each workman was motivated to produce at his respective workstation regardless of the requirement of the plant on that particular day. Such schemes, though used to enhance productivity, also resulted in very high inventory of semifinished stock, thus blocking the working capital unproductively. The TQM culture brought techniques like Just-in-Time production systems which gave immediate results by reducing WIP (Work-In-Progress) level and thereby operational costs. This new culture necessitates a new approach to enhance productivity. JIT productions systems requires a scheme which focuses on team results instead of just individual results. This assumes that all workmen irrespective of nature of their work, have made equal contribution in productivity enhancement. So, each workmen gets an equal earning. In this system, the earnings through the scheme are indexed alongwith lowering (improvement) in the Mandays Per Unit of Production (MDUP) of the whole plant. MDUP = Total Mandays of all workmen in the plant in the month Total No. of unit of production (final output) in the

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By SUSHIL JOSHI

In favour of productivity incentives for workmen

month The earnings calculated on the basis of MDUP achievement at the end of month can further be linked to percentage improvement in quality standard of the final product. This ensures that workmen are quality conscious while improving productivity or MDUP. The MDUP can be improved or lowered by various methods: K The production (final output) increase is achieved without increasing manpower, recruitment, etc.) K By exploring areas where workman takes additional responsibility, e.g., operating more than one machine (multi-machining). These options are feasible in those workstations where cycle time/waiting time for the operator or the idle time for the operator is sufficiently high enough to take care of another machine/ workstation also. K By discontinuing existing temporary/casual/ contractual workmen, if any, and reallocating their work to regular workmen. Such steps enhance workers' perceptions about management in terms of fairness and transparency of intent. To ensure the principle that employees gain only if organisation gains, a minimum level of production in a month can be mentioned as a benchmark below which scheme would not apply in the month. This ensures that the scheme is also sensitive to market situation instead of being operated in isolation, otherwise, workmen gains and market situation may pull in opposite directions during crisis times. Additional Incentive per regular workmen = Total wages saved by discontinuing non-regular workmen Total no. of regular workmen Individual earnings across the plant must remain equal, however, they would be prorated to each individual's attendance status. Incentive to an individual = Actual attendance X Incentive for that month Total working days in a month While the above method of productivity approach

appears quite mathematical, it actually necessitates harmonious industrial relations, where the unions and management are not in conflict with each other, but rather partnering to jointly combat the market competition. The management would need to focus on workmen training, their exposure to other companies to enhance perspective building and visualisation of the larger picture of reality. The workmen and union must be nurtured consistently by management using fair and transparent practices, instead of hide and seek or appeasement. Harmonious industrial relations should further be extended to channelling workmen mental energy into their career growth so that they are able to equate their potential to individual ambitions and goals instead of simply monetary aspirations. With the foundation of such a conducive culture, the productivity approach is sure to succeed as workmen will also be able to rationalise and fall in line instead of seeing their wages and incentives with indifference to the companies' actual market situation.
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Sushil Kumar is Manager-Personnel & Administration with Eicher Ltd., Alwar.