MTP case analysis

1. Bharat Engineering Works Limited

Bharat Engineering Works Limited is a major manufacturer of industrial machineries besides other
engineering products. It has enjoyed considerable market preference for its machineries because of limited
competition in the field. Usually there has been more orders than what the company could supply. However,
the scenario changed quickly because of the entry of two new competitors in the field with foreign techno-
logical collaboration. For the first time, the company faced problem in marketing its products with usual
profit margin. Sensing into the likely problem, the chief executive appointed Mr. Arvind Kumar as general
manager to direct the operations of industrial machinery division. Mr. Kumar had similar assignment abroad
before coming back to India.
Mr. Kumar had a discussion with the chief executive about the nature of the problem being faced by the
company so that he could fix up his priority. The chief executive advised him to consult various heads of
department to have first hand information. However, he emphasised that the company lacked an integrated
planning system while members of the Board of Directors insisted on introducing this in several meetings
both formally and informally.
After joining as general manager, Mr. Kumar got briefings from the heads of all departments. He asked all
departmental heads to identify major problems and issues concerning them. The marketing manager
indicated that in order to achieve higher sales, he needed more sales managers and sales professionals. His
main concern was a lack of engineering support to sales and marketing efforts. The company had adequate
engineers but they were spread under three separate engineering groups. Sales people had no central
organisation which had responsibility to provide sales support. Therefore, some jobs were being done from
outside at higher costs or with lower quality. Besides, he needed a generous budget for demonstration system
which could be sent on a trial basis to customers to win business.
The production manager complained about the old machines and equipments used in manufacturing.
Therefore, cost of production was high but without correspot;lding quality. While competitors had better
equipments and machinery, Bharat Engineering neither replaced its age-old plant nor got it reconditioned.
Therefore, to reduce the cost, it was essential to automate production lines by installing new equipment.
Director of research and development did not have any specific problem and, therefore, did not indicate for
any change. However, a principal scientist in R&D indicated on one day that the director of R&D, though
very nice in his approach, did not emphasise on short-term research projects which could easily increase
production efficiency to the extent of at least 20 per cent within a very short period. Moreover, such projects
did not involve any major capital outlay.
Mr. Kumar got himself convinced about the management process going on in the division and the type of
problems being faced.

QUESTIONS
1. Discuss the nature and characteristics of management process followed in the company.
2. What are the real problems of industrial machinery division of the company?
3. What steps should be taken by Mr. Kumar to overcome these problems?
2. The Assistant Business Manager
Ice Cool Private Limited was an ice cream manufacturing company employing about 100 persons
including persons at various levels of management. Because of increasing business, the company needed
to strengthen its accounting procedure particularly through computerisation. For this purpose, the
company decided to hire a new manager, designated as assistant business manager. The company invited
applications throp.gh press advertisement. After receiving the applications, it appointed a selection
committee consisting of members of top management including business manager Rakesh Mohan . The
committee interviewed several candidates and finally selected Bishwash as new assistant business
manager. Bishwash was neat, well dressed, and quite articulate.
Bishwash joined the company immediately and started working very hard. He used to put extra efforts
and even worked during holidays as he did not have any family responsibility. He gained the reputation of
being a dedicated and competent employee, his strong point being his knowledge of accounting and
computer system. He was reporting to Rakesh Mohan, the business manager who was quite impressed
with his working.
At that time, the company had no computer system, and its accounting procedures were in need of
considerable improvement. Anil Kumar, the managing director of the company, directed Rakesh Mohan to
get the needful done. Since 'most of accounting work related to sales, no separate accounting department
existed and the work was performed under the direction of the business manager. Bishwash was mainly
appointed to strengthen the accounting aspects of the business. He was asked to prepare a project report so
that necessary changes could be made. In order to get the first hand information about'the problem,
Bishwash began meeting regularly with Anil Kumar without the knowledge of Rakesh Mohan. There was
no attempt to have secret meeting; Ani! Kumar would just call Bishwash in for a report without bothering
to tell Rakesh Mohan. The management team, whose members were with the company for a quite long
period had formed a tight-knit group and appeared satisfied with the company. They all worked together
and the company prospered in spite of fierce competition.
The meetings between Ani! Kumar and Bishwash continued and Rakesh Mohan was gradually losing
contact with t~e project and its progress. In fact, Bishwash was almost reporting directly to- the managing
director though he was placed under business manager and retained his title of assistant business manager .
Rakesh Mohan was now visibly upset over the development and was also concerned about Bishwash/s
spreading share of influence. He started feeling let down in the company.

QUESTIONS
1. What is the nature of problem in this case?
2. Could Rakesh Mohan have prevented Bishwash's assumption of power? If so, how specifically/ could it have been
done?
3. Suggest the courses of action now available to Anil Kumar, Rakesh Mohan, and Bishwash?
3. MIS Manager
Sigma Appliances Limited was in the business of trading of various home appliances. For this purpose, the
company entered into agency agreement with different leading manufacturers. The agency business was
doing quite well. About ten years back, it diversified into manufacturing some of these appliances like
electric iron press, electric oven, electric heater and other electrical gadgets. For this purpose, the company
hired a team of technical personnel led by Khempal who was a diploma holder in electrical engineering but
had considerable experience in the relevant field. The marketing was looked after by personnel of agency
division with the addition of some more hands. The manufacturing division also flourished and the
company's turnover crossed Rs. 100 crores with corresponding profitability.
With increased business activities, the company was facing the problem of integrated information system
as this could not be built up since the company graduated from a small-scale level. Whatever information
system was developed, it was based on the needs felt rather than based on planning. In order to develop its
management information system based on computerised processing, the company decided to recruit an MIS
manager and advertisement was put in a leading national newspaper inviting the applications for the post.
After receiving the applications, the company appointed a selection committee consisting of three members-
managing director of the company, manager of agency division, and an outside consultant. The committee
interviewed applicants and selected Narayanan, as MIS manager, an MCS with three years of experience in
MIS in a large company. Narayanan was very happy on this appointment as he thought that he would be
working independently in designing and maintaining the MIS. He was also offered very lucrative
emoluments besides other perquisites.
On one day, Khempal had an informal chit chat with the agency manager (Rajnish) which proceeded this
way:

Khempal: "I have heard that you have appointed a new manager who will provide us information about
how we should do.
Rajnish: "I have not appointed him but the management has done this. I was just a spectator in the
selection committee meeting. Further, Narayanan will not provide us information about how
we should work rather he will collect information from us regarding how we are working.
Khempal: "I do not see any need for that. We are working alright and management has wasted the money
in appointing Narayanan. With this money, I could have hired three more engineers who could
have done something meaningful. Well, it is their money. If they want to waste in this manner,
what we can do."
The chit chat ended as both departed. After joining the company, Narayanan took some time to
understand the existing information system in order to augment it. In order to do this, he decided to meet the
senior personnel personally to understand their information need and the information that could be generated
from different parts of the organisation. In this process, he met Khempal in his factory office which was
adjacent to the administrative block and the conversation took place as follows:
Narayanan: "Good morning sir."
Khempal: "Good morning. How do you do?"
 Narayanan: "I am fine sir. Sir, I want to know what information your department needs."
Khempal: "If you want to enjoy a cup of tea with me, you are welcome. But if you want to ask such a
silly question, I am sorry."
At this, Narayanan looked visibly upset and left the factory office after saying, "Sir, I will meet you later."

QUESTIONS
1. Discuss the nature of problems involved in this case.
2. What kind of perception was formed by Khempal about the role of MIS manager? What would have been probable
reasons for this?
3. Advise Narayanan about how he should proceed.

What methods should the chief executive adopt to overcome the problem?

4. Super Engineering Company

Super Engineering Company was a multilocationallight engineering company. It had manufacturing
facilities at Hyderabad, Pondicherry and Indore. The company adopted budgetary system with main
emphasis on production and expense budgets. The budget targets used to be set on the basis of analysis of
production facilities and production operations. While two units located at Hyderabad and Pondicherry
were working properly and were able to meet their budget targets, Indore unit was not able to do so.
Mr. P. Manohar was transferred to Indore unit as plant manager. He joined the company about eight
years back as engineer trainee and became the assistant plant manager at Hyderabad unit, the b iggest of
the three units. Manohar was very ambitious and a little bit autocratic. He believed in the exercise of
authority and control to carry out his instructions. He was high achiever and believed in getting things
done. He got quick promotions in the company.
Immediately after joining at Indore unit as plant manager, Manohar made preliminary study of the
plant and issued instructions to all departments to increase production by ten per cent. He also instructed
all supervisors to strictly adhere to budgets. He introduced several new reports and watched the operations
very closely. He suspended two supervisors in the second month for not meeting the budget targets .
Subsequently two supervisors left the plant.
With all his efforts, the unit was very much on the right track and within six months exceeded the new
budgeted figures by eight per cent. On setting the plant right, he was called back at Hyderabad unit as
plant manager where vacancy arose. However, shortly after he left for Hyderabad, the productivity at
Indore unit fell below the earlier level and the budget was again in trouble.

QUESTIONS
1. Analyse the type of organisational climate created by Manohar at Indore unit.
2. Why was there a drop in productivity at the unit after Manohar left it?
5. Majestic Electricals Limited
Majestic Electricals Limited was engaged in manufacturing and selling electrical goods of high quality. It
believed in introduction of new and sophisticated products in the market. Mr. K.S. Lal, previously the
corporate development manager, was promoted to the rank of general manager in the company. In his new
position, he needed a bright manager to serve as his deputy to assist in carrying out his day-to day
activities and coordinating marketing, manufacturing, research and development and finance functions.
There were three \ candidates available who could be considered to the position of Mr. Lal's deputy. All of
them had very good academic background and successful careers of varying lengths with the company.
The first candidate Mr. Rohit was with the company for the last three years . He had engineering and
M.B.A degrees from reputed universities. He believed in high achievement. He used to perform assigned
tasks very quickly and accurately. He performed well when he had complete control over the situation.
Many critical tasks he preferred to do himself and accomplished in much shorter time.
The second candidate for the position was Mr. Rahul. He had Ph.D. degree in quantitative analysis
with engineering background. He joined the company about a year back. His performance in the previous
job was rated to be of high standard and he got quick promotion with wider responsibilities at each
promotion. He developed good understanding of the company's working though he was somewh~ reserved
in staff meetings.
 The third candidate was Mr. Prakash; he did not have any engineering or management degree but
attained good marks in his arts degree. He had been with the company for the last fifteen years. He was
quite good in his work and had good knowledge of the company's operations. He enjoyed working with
most key managers and did not have confrontation or disagreement with any manager of the company.
However, he was not aggressive and had difficult time in examining critically new ideas and proposals.

QUESTIONS
1. Assuming that you have-to select one of the above candidates, whom will you prefer?
2. If you have to conduct interview for the selection of the candidates, what types of questions will you ask?
6. Stylotex Limited
Stylotex Limited was the manufacturer of high fashion dresses both for domestic and international markets.
Its emphasis was to develop latest and unique designs specially for ladies and children. Design was the main
strength of the company's business success. The company employed about 600 employees out of which 20
(all females) were in design department. The main function of design department was to collect information
about the prevailing fashion in international and home markets, analyse the information, and to suggest and
prepare suitable design for the company.
Miss Sangeeta joined the company as chief designer. Prior to joining this job, she received M. Sc. degree in
Clothing and Textile with specialisation in dress design. She also received dress design training for six
months from a reputed institute in the U.S.A. She also received her summer training for two months in
Stylotex as part of her _M.Sc. degree. During her training, she impressed the management with her creative
thinking about dress design. Many designs suggested by her during this period were accepted by the
management and were appreciated by the customers. Therefore, when the chief designer of the company
retired and Sangeeta applied for the position, she was taken by the management to fill the vacancy.
Since Sangeeta was with the company for two months as summer trainee, she knew the work culture of the
company. She was knowing most of the employees of design department. She was also aware about the
likely resistance that she could meet on her joining the position as she 'was replacing a very experienced and
highly esteemed lady. Though she could not expect direct resistance from others, she was very serious about
the resistance to be shown by one designer Mrs. Vimala who was in her fiftys and was designer in the
company for the last fifteen years. That 'grand old lady', as she used to be called by her colleagues, carried
lot of weight with the group members. She did not have liking for a young girl directing and controlling
them. Therefore, Sangeeta thought rightly that without her active cooperation, she could not succeed in her
career. However, she was determined to get her career off on the right foot. As a result, she was giving
serious thought to win over Mrs. Vimala and other members of the group but was not sure how to proceed in
the matter.

QUESTION
1. Advise Miss Sangeeta how she should proceed in the matter.

7. Vishal Components Limited

Vishal Components Limited manufactures a wide range of automotive components. It has a workforce of 1500
including 250 supervisors and executives. Performance appraisal of these supervisors and executives is
conducted by their respective superiors annually. The parameters used for performance appraisal are sense of
responsibility, superiors' dependability on subordinates, initiative, regularity and punctuality, community
activity and potential for development to take higher positions. All these factors are given equal weightage.
The performance appraisal has three objectives: to grant annual increment, to determine promotability, and to
assess training needs.
In the year 1998-99, some supervisors and executives were not given any increment because as per
performance appraisal, their total scores were below standard. The overall low scores were due to community
activity and potential for development which were given equal weightage alongwith other factors. On the
stoppage of annual increment, the aggrieved supervisors and executives represented their case to the Managing
Director of the company and contended that the entire performance appraisal system was faulty. They were
very much against the inclusion of community activity and potential for development in the performance
appraisal meant for giving pay raise. They argued that all aggrieved supervisors and executives should be
given regular annual increments and time-bound promotions. The system would be more objective, fair and
free from undue biases.
QUESTIONS
1. As human resource manager, how will you defend the existing performance appraisal system of the company? Will
you like to incorporate changes, if any? If yes, what would be these changes and why?
2. Should there be separate appraisal criteria for appraising supervisors and executives? If yes, where are such differences
needed?
3. What actions should be taken to the representation made by the aggrieved supervisors and executives?

8. Milk Products Limited

Milk Products Limited is engaged in collecting, processing, and distributing milk and
milk products in a large city in South India. Most of the products of the company are
such that these have to be distributed on daily basis. The company has a crew of
distributors who approach the fixed customers, both bulk buyers and indi viduals. Mr.
K Ramesh joined the crew of distributors after graduating in- Commerce. The
distribution manager was quite impressed by Mr. Ramesh but initially could not offer
him a better job than that of a distributor. However, he promised to give him better
opportunity whenever available. Mr. Ramesh joined gladly.
The distributors are employed on monthly salary basis. In order to ensure distribution
of the products, the company has a provision of over-time pay. Normally, crew
members work slowly in the beginning just to accumulate over-time pay. The pace
becomes hectic towards the end of the day with some over time to meet the distribution
schedule. There is no group leader but there are several old-timers who influence
newcomers regarding the work rules. Mr. Ramesh did not like this method of working
but had to follow the group to be a good team mate. He gathered that over the years,
the company had paid around sixty per cent overtime unnecessarily.
After a year, impressed by the work of Mr. Ramesh and his overall suitability, the
distribution manager offered him the position of distribution supervisor. The basic duty
of'supervisor was to look after the distribution system and to develop new customers in
a given area. Beside Mr. Ramesh, there were four other supervisors also. Ramesh was
sure of making distribution system effective as he was aware about the delaying tactics
of the crew. He was quite sure about cutting the overtime cost and impressing upon the
manager about fixing the quota of work per day in two parts before lunch and after
lunch. The distribution manager left convinced and introduced the system. However,
the efficiency dropped down considerably and no crew member was near the target.

QUESTIONS
1. What were the reasons for decreased efficiency in the new system?
2. Advise Mr. Ramesh and distribution manager about the future course of
action.
9. The Goldmine Scheme

Sterling & Co. had an incentive scheme for its factory personnel on piece rate basis, amounting to Rs.
10 per good unit manufactured. For the year ending 31st March, 1987, the company recorded an
average monthly production of 18,000 good units, excluding 2,000 units per month, which had to be
scrapped, after all the manufacturing operations, due to the vigorous quality control standards
maintained by the cOlI\Pany. The realisable value of scrap is Rs. 20 per unit. The unit pricing structure
of the product is as follows:

Variable manufacturing cost (exclusive of the piece-rate incentives to workers) Rs 80

Selling and distribution cost Rs 25

Selling price Rs 160

Fixed expenses Rs 360,000 per month

Mr. Lal, the labour union leader approached, Mr. Patel, the Managing Director of the company, for a
better incentive scheme which would substantially benefit the workers. After considerable
deliberations, it was agreed that the incentive amount shall be increased to Rs. 15 per good unit
manufactured, subject to a minimum achievement of 20,000 good units per month. It was further
agreed that the new incentive scheme shall be initially tried for a period of three months and subject to
review by Mr. Patel thereafter, it shall be at liberty to impose any further conditions, without
increasing the monthly target of 20,000 units, which shall be duly accepted by the union.

All the workers were happy about the new scheme, which increased their incentive amount by 50 per
cent and they were quite confident of achieving the monthly target . They enthusiastically named the
new scheme as "Goldmine", which became quite popular in the company.

During the trial period of three months, the average monthly production of good units increased to
21,000. At the same time, 3,000 units had to be scrapped per month. Mr. Patel was extremely cheerful
to see the stepping up of the production of good units. However, after a little thought, the sudden hike
in the rejected units worried him very much. Due to severe competition, no increase in selling price
was possible, though fixed cost per month increased by 10 per cent on account of in creased production
level.

QUESTIONS

1. Has the company been benefited by the introduction of the "Goldmine" scheme?
2. Do you find any lacuI)ae in the framing of the "Goldmine" scheme?
3. What should be the future course of action by Mr. Patel?
 10. Inter-personal Relations
Vikas Pvt. Ltd., an engineering firm with 50 years of success behind it, has become a household name in
India for its quality products. Although it had started its business in a modest way, it became a dominant
supplier of spares and equipments of critical nature needed by the Transporter and Engineering Industries
in a short span of 10 years. Later, with the advent of industrial planning initiated by the Govern ment of
India, and by virtue of its position in the engineering business, it made rapid strides in many product lines
including electronics. In 1960, its assets were of the order of Rs. 200 crores with a total employment of
over 10,000 spread over all important industrial centres in India. With the growing complexity of
management, the top management, time and again, discussed the need for reorganising the entire business
on functional lines, and finally introduced decentralised administration on April 1, 1974.
Mr. Vasudeva, an MBA from Harvard with a Mechanical Engineering background, was incharge of
the Mechanical Engineering Section since 1964. He was promoted as the Chief Executive of the Division
in April, 1974. This was in recognition of his outstanding contribution to the development of new product
lines, especially in the area of compressor-cum-vacuum pumps. In fact, the firm earned a good name in
the export market and also bagged an export award during 1973-74. Moreover, Mr Vasudeva was known
for his honesty, integrity, leadership and decisiveness. He was a brilliant engineer and always worked
hard to be a step ahead of his competitors in the field. He was virtually a think-tank, and the management
was very proud of him.
For the last six months, he spent long hours redesigning the export model- T compressor-cum-
vacuum pump set. In his discussions with his foreign collaborators, he was convinced that with a little
more effort, the company could successfully redesign the model, thus saving production costs as well as
improving the efficiency by 16-20 per cent. He depended entirely on Mr. Hanuman, a foreman of
exceptional ability and tenacity. Moreover, Mr. Hanuman was good at human relations and commanded
respect from his immediate subordinates. Since the fabrication of the new model was in its infancy,
everyone concerned felt it undesirable to let others know what was happening on the shop-floor.
Moreover, secrecy was the style of operation and, therefore, it was clear to both the foreman and the
persons working under him that this matter would not be brought to the notice of Mr Keshav, the new
Works Manager, and a recent induction into the company. They were one with their new job and always
delighted in any words of appreciation from their chief, Mr Vasudeva, when he visited the shop-floor.
Mr Keshav was young and energetic with a flair for Mechanical Engineering products. He had no
knowledge of management, but had attended a few courses in materials management and productivity
control. He always laid stress on proper supervisory activities, knew his job well and always expected
others to perform their duties as scheduled. He could never tolerate indiscipline. His colleagues had nick-
named him "the real fire-brand' of the company.
One evening, before going home, Mr. Keshav went to the shop-floor where he found six machinists
and helpers engaged in fabricating a spare part of the pump set as per the order of Mr Vasudeva. Mr
Kesl)av was happy to see people working under him so involved in their work.

However, his enthusiasm vanished like morning visit when he saw that, what they were engaged in
was not a normal part of their work. "Damn it. What the devil are you up to?" he asked in annoyance.

The workers were perplexed, they did not know what to say. However, Mr.
Hanurnan soon appeared on the scene and explained the ongoing project and the benefits its
success would bring.
The Works Manager got very angry with Hanuman and reprimanded him severely. In fact, he
was admonished in the presence of his subordinates and technicians working on the shop-floor.
Mr Hanuman felt confused and hurt. As though this was not enough, he received a show cause
notice from the Works Manager demanding an explanation within 24 hours. This was adding
insult to injury. He had no alternative but to report to the chief, but to his chagrin, he found that
Mr Vasudeva had already left on foreign tour, and was expected back a month later.
Mr Hanuman felt that he was approaching a dead end and harassed, he went from pillar to
post but no help or advice was forthcoming. Exasperated and hurt, he went to the General
Manager and handed in his resignation letter.
Mr Hanurnan was known for his honesty, simplicity and hard work. Only by the dint of hard
work, had he developed his skills and risen to the position of foreman from the level of an
ordinary helper within a space of 10 years. Everyone knew the role he played in developing a new
Model-T vacuum pump. His one weakness was that he was very sensitive and would never
compromise on issues affecting his personality and dignity. On the whole he was respected by all.
 News of his resignation spread like wild fire. The workers, technicians and others
sympathetic to his cause were alarmed, and eagerly awaited the outcome.

QUESTIONS
1. Was the GM right in accepting Mr Hanuman's resignation?
2. Was it well advised to keep Mr Keshav in the dark about the on-going project, especially
since he was Works Manager?
3. Did Mr Keshav act hastily in reprimanding Mr. Hanuman?
4. What action should be taken now?
5. What repercussions would this incident have on all involved?
11. Mr. Kamal Nayan
Mr. Kamal Nayan joined as Office Manager, Industrial Products Limited, Mumbai after
coming back from U.s.A from where he got his M.B.A. degree with specialisation in personnel
management. He was young and energetic and believed in results. Before proceeding to U.S.A,
he had several years of experience in India in different capacities. When Mr. Nayan joined
Industrial Products Limited, its office time was 10.30 AM. to 5.30 P.M. He felt that the timing
should be changed to 10.00 AM. to 5.00 P.M. because he knew that office personnel in U.S.A
did not work after 5.00 P.M. He thought this to be true for India also and to ensure more
availability of effective time for office, he changed it to 10.00 AM. to 5.00 P.M. He announced
the change officially.
No one reacted initially but after two days, Mr. Nayan received a written memorandum by
all office personnel that old office timing be restored. Mr. Nayan did not yield to this demand.
However, he was convinced that the first step was to build cooperative spirit among his
employees through informal get-together. Therefore, he prepared a scheme of having monthly
dinner party of all members of the office. In the party, all members were to bring their home-
made dishes. Their wives and children were to be encouraged to attend the monthly dinner
party. The scheme was announced through placing it on the information bulletin of the
company. The notice also invited suggestions from the members for making the scheme
successful. Two weeks elapsed and no suggestion came. On one occasion when the day was
nearing for the first dinner meeting, he overheard the following conversation between two of
his office members:
First employee: "So, what are you bringing for the party? As for myself, I will bring
Bhelpuri."
Second employee: "I will bring Chana." (Both laughed)
Mr. Nayan felt that nobody seemed to be concerned in his scheme.

QUESTIONS
1. What were the reasons for not supporting the actions of Mr. Kamal Nay~n by his employees?
2. Advise Mr. Kamal Nayan how he should proceed in the matter.
12. The New .Manager
Mr. Avinash was appointed as general manager, administration in Phoenix Industries Limited. He joined
the company only about two years back. Prior to joining this company, he serv~d another company for
two years. He did his M.B.A. from a reputed institution. He considered himself as a high flier. After
getting promotion as general manager, administration, he felt quite excited and was quite enthusiastic
about his new job. The post of general manager was sufficiently at high level. However, because of young
age and lack of adequate experience, Mr. Avinash was.considered as junior executive by most of his
subordinates.
The administration department of the company had four major subunits: purchasing, record
maintenance, printing and secretarial services. Each subunit was headed by a manager. These four
managers were directly reporting to Mr. Avinash. They had combined experience of over 80 years with an
average age of 45 years. Most of them had been with the company for a fairly long period of time and that
too with their present units. Since Mr. Avinash was quite less experienced and young, these four managers
viewed his appointment with hesitancy and suspicion. Also, they had liking for the previous general
manager and were sorry to see him leave the company.
The new general manager, A vinash, started holding weekly meetings of the department. However, he
noticed that managers were hesitant to speak in the meetings; he was the only one to speak. He made some
changes in the operating procedures that he felt would increase efficiency and announced them in weekly
departmental meeting. There were no reactions to the changes, but later he noticed that the managers
continued to follow the old procedures. He talked to them individually but felt that they were not opening
up to him. The problem continued.
Aft~r about two months, A vinash started receiving complaints from other departments about the
services they received from the administration department. These complaints mostly related to printing
and purchasing. A vinash believed that his department should provide the best possible services and,
therefore, admonished his managers in a weekly departmental meeting. He still received little response
from them. He continued to receive complaints and was becoming increasingly frustrated. On one day, he
became very upset at the third complaint that week over jobs done in the printing unit. He stormed out of
his office down to the printing unit. The manager of the printing unit was out. A vinash called over the
chief print operator, chewed him out, and told him to re-do the job on the same day. When printing unit
manager returned and learned what happened, he immediately called a meeting with the three other
managers and described the events to them. On this, commented the manager-puchasing unit, "We have to
do something. Avinash is too young, incompetent, and is a tyrant." "1 agree, he dictates to us in
departmental meetings, and now he goes behind our back to our employees. He shows no confidence in us.
I am fed up with this situation," said manager-secretarial services. Finally the manager-maintenance
chimed in, "1 don't think we have much choice. Avinash is regarded high by top level management. We
can't talk to him and higher up, and if we continue doing things this way, our careers will be ruined.
Therefore, I think that we should look for some other job opportunities." They all reluctantly agreed with
this statement and the meeting ended.

QUESTIONS
1. Describe the nature of the problems in this case.
2. Explain what could have been done to prevent the problems.
3. Outline the means you would propose to solve the problems
.13. New Job Design
Newstyle Furniture Private Limited was a medium-sized manufacturer of furniture. The primary product
line included office furniture, lawn furniture, and exercise equipments. The plant of the company was
located in the suburb of a metropolitan city. The company employed about 125 workers. The plant was
highly labour- intensive. Even though the plant used an assembly line system, there were numerous
single person jobs in the production and assembly operations.
The operations had not changed much over the period of time. However, for the last two years, the
company was experiencing the problems of high level of employee turnover and absenteeism. In many
cases, the rate of employee absenteeism used to be around 15 per cent.
Similarly employee turnover used to be around 40 per cent for the last two years. These were
considered to be quite· significant. The company was experiencing the quality problems because of poor
workmanship. In many cases, there were complaints of defective furniture. In some cases, there were
complaints that someone had carved or cut a symbol in the vinyl covering. Being frustrated over these
complaints, the production manager talked to the assembly line supervisors and some of the workers.
Such talks revealed him that the work was mostly of repetitive nature and, therefore, boring. This
prevented workers from putting their best resulting into inferior quality. This also caused high level of
absenteeism and turnover.
The production manager was worried over this and wanted to make the jobs more interesting and
enriching. However, he was not quite sure as how to proceed. Therefore, he talked to the chief executive
of the company who felt that the matter was important and urgent and the decision was taken to engage
an outside consultant. The people from consultancy firm visited the plant several times and analysed the
production process. Since the production process was such that it was difficult to change many of the jobs
without changing the whole process of production and assembly, the consultants recommended a change
from an assembly line operation to semi-autonomous task groups responsible for the complete production
and assembly of certain types of furniture. They further proposed that to implement this change, there
would be additional investment in machineries to be used in the production of several types of furniture
and the top management had to accept lower quantities of production but that would be offset by better
quality product and lower employee cost in terms of lower absenteeism and turnover. There was initial
hesitancy on the part of the top mctnagement to accept the proposal due to reduced volume of production
but ultimately it agreed to the proposal as it had long-term favourable impact.
The production manager was quite happy that the problem was over and decided that the first step was to
inform the employees of the impending change. He organised several meetings with the employees to
discuss the impending change. During these meetings, he observed that many employees spoke in favour
of change; some maintained silence but to his utter surprise, several voiced against the change. One of
the employees commented, "this is a great change. It is for the first time· that company has taken care of
employees and thought about their welfare. We are bored of-monotonous jobs and new jobs will provide
us better challenge." Another employee who was not in the favour of the change, commented, "1 do not
like any change in my job. I like the way it is. The new job will put me in difficulty and unnecessarily
take more of my time. I have been using this time to do the things which I prefer like attending family
problems and enjoying life." The production manager was back at square one thinking what to do now.

QUESTIONS
1. What is the nature of problem in this case?
2. Could production manager have followed any different process and have been more successful? If so, explain.
3. What seems to be production manager's problem now?
4. Recommend a solution for production manager's problem.
14. Automotive Components Limited
Automotive Components Limited ed is a major manufacturer of automatic filters mostly used in automobiles
of various types. It supplies filters directly to automobile manufacturers in bulk quantity besides supplying to
the market for replacement. On one day, two engineers from a reputed engineering consultant came. They
inspected the production facilities and workshop. They came on the next two days also. During their visit, the
atmosphere in the workshop was tense as the engineers made several enquiries from the foreman of the
workshop. Three days after the last visit of these engineers, a notice was put on the notice board asking the
workers to shut off motors and lights during the lunch break.
During the following week, a rumour spread that the company was not able to discharge its contractual
commitments because of the technical defects in the plant. Therefore, a big order was likely to be cancelled
resulting into closure of the plant for some time. This period became quite disturbed both for workers as well
as for the foreman. Three workers made enquiries on different occasions from the foreman about the reasons
for the visits by the outside engineers. In fact, one of the workers put a question, "Is there going to be layoff
in the plant"? The foreman himself being ignorant in the matter had little to say. Thus, rumours spread further
about the likely layoff and retrenchment of some workers. The workers became nervous and productivity
dropped. They approached their union leaders about the possible layoff and retrenchment. The union leaders
criticised the approach of the management and threatened with strike if any worker was laid off or retrenched.
On getting this news of lower productivity and threat of strike, the production manager visited the plant
and talked to the foreman and some of the senior workers. 'One of the office bearers of the union questioned
angrily when some of them were to be thrown out. The production manager was taken by surprise and asked
the foreman what workers were talking about. The foreman narrated the total situation right since the visits of
outside engineers and notice of conserving power. He also told about the rumour of cancellation of big order
and consequently retrenchment of some of the workers. The production manager was taken aback and could
not believe what the foreman was saying. He asked the foreman, "But all this is not true; did you not tell the
workers?" The foreman kept quiet.
Later in the day, the production manager called a meeting of union office bearers along with some
workers. He also invited the foreman to attend the meeting. In the meeting, the production manager informed
about the objectives of the visits of outside engineers. He told that the engineers were invited to observe the
existing machine layout and to draw plan for installing a new equipment. He explained that notice for putting
off motors and lights during the lunch break was meant to save power as there was shortage of power and this
had nothing to do with the visits of the engineers. Regarding the cancellation of order, he agreed that one big
order was likely to be cancelled because of some troubles at the buyer's plant but the company had secured a
much bigger order and that instead of layoff, there would in fact be more recruitment . But all these could not
convince the workers and after two days, the union gave a notice to the production manager for a one day
protest strike.

QUESTIONS
1. Discuss the reasons for the problems that arose in the company.
2. Advise the production manager how he should proceed in the matter.