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PRESENTED BY:-

GROUP NUMBER :-2 SECTION :-C

MITHUN KUMAR MOHANTY 11202161ABHENDU CHANDRA SAHA 11202162

SURANJAN MAZUMDAR 11202164

SOMNATH BAHTTACHARYA 11202167

ADNAN AHMAD 11202170

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Briefing on case study

Issues involved

Theoretical inputs

Alternatives available

Advantages & Disadvantages of Alternatives

Recommendation

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HR problems faced by Bata India Ltd. - End of the 1990s. Loss of 420 million in 1995.

1995-Bata Shoe Organization Restructured entire board

William Keith Weston-MD

Mike Middleton- Deputy managing Director

R Senonner headed Marketing division.

The profit went down in 2000 after a consecutive increase in

the profit margin for four years since 1995

1996- BATA signed Bipartite agreement.

1993-99 cut down the staff - to 6700 and welfare measures.

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ASSAULT CASE

1996- Chief welfare officer was assaulted in Batanagar.

1998-Weston was assaulted by four workers at Batanagar

Management dismissed three employees

Batanagar employees went on strike after two days.

BSO withdrew investment plans

In 14 Jan 1999,BMU submitted demand list to the

management.

Economic and non economic issues(reinstatement of four

dismissed employees)

Demanded worker participation in management.

Wage hike - Rs 90/ week.

Increase ofplanbonus & introduction of attendance bonus

for migrant workers.

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INDUSTRIAL RELATIONS

1995& 1998 Signed 3 years bipartite agreement with BMU

and WB govt.

Feb 1999- Lockout in BATAs Faridabad unit-manufacturingHawai Chappal & canvas.

Oct 1999- Unit resumed production-3yrs wage agreement

signed.

March 8, 2000- Lockout in Peenyas.

July-2000 BATA lifted lockout.

Demanded Revocation of 20 fellow employees, maintaining

normal production schedule, confirmation to standing orders

not to be insisted upon. September-2000 Downsizing resulted Labor dispute as

management increased outsourcing from china and perceived

declining importance of Batanagar unit.

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Financial Breakdown: The Bata company experienced a loss

of 420 million in 1995 for the first time in the companyshistory. They were leading the Market single handedly for 60

years and made the market almost a monopoly.

Labor Problem: The Trade Union had conflicts with themanagement intentionally. Strike was a regular phenomena for

this company also labor class employees assaulted their own

MD, Mr. William Keith Weston in 1998.

Labor Surplus: The company had surplus labor since a long

time. The data shows, they had 15000 employees in India

whereas their next competitor the Liberty Shoes had only 5000

employees in 1995.

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High-cost structure: This was another consequence andimportant concern of the organization. They were incurring a

lot of employee wages, employee welfare wages. The data

shows 22% of their sales were distributed among the

employees as salary in 1999 whereas only 5% was the

employee salary wages for Liberty Shoes.

Change in Management: The entire Board of Directors were

replaced with a new group in 1995. They laid off more than

250 managers and stopped recruitment.

Cost Cutting: They took several steps to cut the huge coststructure by phasing out several welfare wages, they

employed forced retirement by asking juniors to quit.

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Outsourcing: Earlier outsourcing was limited to assembly &sewing line job now company outsourced fully manufacturedshoes from China.

Selection and recruitment issues: Bata offered its staffemployment policy linked to sales growth performance.Employees were resistant of such changes.

Compensation(a) Basic remuneration issues: The basic remuneration was poor

and there were no set standardized norms for increase in the

pay.(b) Productivity Linked Incentives: Productivity linked

incentives was utilized effectively. In 1997, Bata workersachieved 93% of their production targets. The managementrewarded the workers with a 17% bonus, up from the 15%

given in 1996.(c) Employee Benefits and services: The company nearly

withdrew management subsidies, canteen facilities, electricityand health care schemes for the employees' families whichincluded the plan of dismantling the public health unit

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TRANING DEVELOPMENT & CARRER MANAGEMENT

when the people were retrenched and others handled the

same job no training or development issues were visible. The

carrier development aspect of the employees was also missingwhich contributed to the low morale of the people.

ENVIRONMENTAL CHANGE

Due to post economic liberalization the percentage of cost

towards employers was a massive 22% compared to its

competitors 5%. as their profits were declining.

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MANAGEMENT OF TRADE UNIONS.

Trade unions had influence of the various political parties.

These elements were scrupulous in nature and so usednegative tactics like militant force and assault on themanagement.

JOB DESIGN

Job design at Bata was identified and refined from time totime and so they were able to remove excess manpower aswell as cut down unnecessary expenditure.

SURPLUS MANPOWER

Heavily overstaffed and had a huge expenditure towardsemployees compared to their competitors.

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SELECTION AND RECRUITMENT ISSUES

Employees were resistant of such changes but the perception

of corruption associated with Bata the change was a right step

as these managers were indulging in large scale corruption.

MANAGING SEPARATIONS AND RIGHTSIZING

Retrenchment was carried out but no sensitization paid to

these issues which had an adverse effect on the employees

morale. Overstaffing issues were handled with a strong hand

and people asked to leave.

MOTIVATION

As the company sold its Calcutta office the employee's morale

was low due to the issue of honor associated with it. The

motivation levels of the people who had to shift from a metro

to a small town also would have taken a severe dip.

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Individual rewards & recognition along with a revamped HR

strategy with respect to hiring & compensating employees.

Employees should had been given proper bonuses along with

other perquisites,ie, Bata should have kept the promises it had

previously made to its employees. This should have been the

best alternative.

The budget of employees welfare could have been omittedcompletely & salary should have been increased in place of

that.

There should have been a proper middle management who

could bridge the gap between the BMU & The topManagement.

Recruitment policy should have been restructured prior to

1995 itself when it decided to stop recruitment.

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Motivation level of the present employees would have been

increased individually.

Employees would do their work in more effective & efficient

manner. The team work could have been more efficient inorder to get more bonus.

Companies fund would have been increased in better manner

& employees would also become happy due to the increaseof salary.

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This procedure would not enhance the motivation level much

for some of the less efficient employees.

The top level management would have been dissatisfied with

this decision.

This could bring some additional profit in the company

overall. However, this could also bring more conflict between

the top level management and the Union.

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From the above case we can understand that having the right

HR practices is very important for over-all profits & reputation

of the company. Here the main thing is lack of people who

would have acted as a mediator between the top management& the labor unions.

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