IPM Professional Qualification in Human Resource Management Management Case Study 8 Industrial Relations Batch ID PQHRM 22/07 Question 6 The problems that have arisen, findings have been considered and recommendations have been given from points 1 to 5. Question 1 ?Company could not or did not adapt to the changing market conditions. They did not change their strategies of production and did not properly analyze the market conditions. ?Due to the incompetence of the management the company was taking a hit financially.
But the management instead of rectifying what went wrong took the easy way out and blamed the labour for not giving their maximum output. ?There was no industrial peace and industrial peace is vital to ensure the smooth flow of work. Trade unions that have political affiliation were main reason for the ongoing industrial dispute and their dissatisfaction in the existing government did not help. In addition to this they were two trade unions that had an internal dispute among themselves. ?The “Bolts & Nuts” terminated several employees in an illegal manner.
Certain employees who were alleged with pilfering were terminated without a disciplinary enquiry or issuance of a show cause letter. Certain employees were terminated for picketing whereas picketing and striking is legal. ?The union and its representatives entered and agreed upon a collective agreement without properly considering the terms and conditions of the agreement. This could be attributed to the lack of negotiation skills. ?Management did not ensure that the workers had the proper tools and skills to increase or even maintain their production levels.
The machinery provided for the workers to work with were outdated and not in proper working order. ?Management resorting to illegal means of terminating employees and closing down the factory even before the commissioner or labour made his/her final verdict. ?The environmental authority’s pressure to sort the matter of waste water disposal can be considered as the final blow to the company as there was no way the company could implement a waste water disposal system.
Question 2 The above situations could have been averted through the management acting in a timely manner instead of waiting for the market conditions to turn bad. They could have done the following to avert the disaster that occurred: ?Conducted a market survey if the competitors products and their market conditions. The management could have done a PEST (Political, Economic, Social and Technological factors) and SWOT (Strengths, Weaknesses, Opportunities, and Threats).
This would have made sure that the management knew where their organization stood as per the market condition and their competitors and the various factors in SWOT or PEST. ?The management should not have blamed the workers for not giving their maximum input. They should have instead introduced a small scale incentive scheme and got the workers motivated so that they worked with them in this crisis situation instead of working against them.
They should have also asked for the workers feedback on the reason for this situation and their suggestions on how to improve production. ?Implement Six Sigma. Since Six Sigma focuses on improving productivity without investing in new equipment and increasing productivity through improving the way thing are done or the improving the individual processes itself it would have boosted productivity and increased quality of the products and the productivity of the organization (See next page for the Six Sigma process Diagram 1) ?
Negotiations to come to a collective agreement should have been conducted with the majority trade union representative preferably the head who is a competent negotiator and the representative for the employer should have been a member of the EFC or its representation body. The Labour Department should have been involved in this negotiation session and provided conciliation. Diagram 1 ?The management should have not terminated employees in an illegal manner.
They should have instead have offered a VRS or if that was not applicable they should have referred to the labour commissioner on job cuts before things they started severely taking losses. Another option that the management had is to ask the employees if they were agreeable to a pay cut. ?Although the company could not afford new machinery they could have done a major overhaul or repair all the machinery that was in use. This would not have given them a boost in production but they would not have lost production either. With regards to the environmental authority the company could have negotiated with them and come to an understanding that the waste water system will be implemented when the company was financially stable. ?Faulty recruitment and selection process. HR or Recruitment department did not find the best fit for the job. This would have been the lead cause for industrial disputes. ?The HR dept could have done a Training Need Analysis and then provided the required training for the workers if the reason for lack of production was lack of skill Question 3 Yes.
Good IR in a company can be attributed to the following ? A relationship between employer and employee where collective bargaining is used extensively and joint problem solving exists in order for both parties to mutually benefit. ?Genuine employee involvement and HR practices that involve information gathering, consultation of employees and having their participation in all initiatives. ?Involvement of a third party during disputes where both parties maybe biased to their own cause. As per the above points we could draw to the conclusion that Bolts & Nuts Company has poor IR.
The company did not have a good rapport with its employee and evidently didn’t use the workers knowledge and suggestions to jointly solve the problems. Collective bargaining was used but not extensively and effectively. Also the fact of employee involvement in information gathering for HR practices is not evident. Employees were not consulted for their views of the situation. Involvement of the labour department was evident but again too late. If a labour department representative was present at the collective bargaining sessions the session would have led to a reasonable collective agreement that was fair.
But since this did not happen the collective agreement only led to more disagreement and therefore the collective agreement was rendered redundant. Question 4 The HR manager is partially responsible for this situation as it involved the illegal termination of employees, hiring of employees who were not the best fit for the companies’ requirements and not conducting a Training Need Analysis to ascertain if the employee’s lack of production was due to a lack in Knowledge, Skills or Attitudes and providing the required training.
Question 5 The only way for this crisis to be resolved is to implement all the points given in question 2. That would be to Conducted a market survey, Implement Six Sigma, Negotiate an effective collective agreement, the major overhaul of all the machinery, involve employees in the decision making process and providing training as required once a TNA is done.