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Human
Resource Management
Attempt
Any Four Case Study
CASE
1: It is Good News Everywhere for Coca Cola
After fumbling in India for over a decade
and losing the top slot to Pepsi, the humbled cola giant is dreaming big again
and rejigging its strategy with a fresh and sharper focus.
Why did Cola giant fumble in
the first place? Here are some mistakes and learnings that Coca Cola has
undergone in the past:
Globalization
Holds the Key
Coca Cola was among the bluest of blue
MNCs to have entered India in the 1990s. It was and still remains among the top
five most powerful brands and the largest beverage company in the world. A lot
of that MNC arrogance had a rub-off effect in the way it laid out its India strategy.
Snapping up the locally popular brands like Thums Up, Limca, Maaza to
competition, its brand-building exercise for the mother-brand was often at the
cost of the local ones. It was costly and often didn’t work. Thumps Up remains
a very strong brand in southern states like Andhra Pradesh and in fact in the Brand Equity Most Trusted Brands
listing, it ranks 34—much higher than Coca Cola’s 42nd ranking. As the company redraws its India
plans it promises to be far more rooted to the realities like having more local
insights, promoting local drinks like Aam Panna and localised variants like
Sprite—Jal Jeera.
Delegate,
Empower and Be Patient
Five CEOs in a decade, a high employee
turnover of 30%, Coca Cola India was in a chaos as constant churn at the top
took its toll. “Every time a new CEO took over, he drew out a new strategy and
a fresh game plan to win the market”, recalls a Delhi-based ex-employee. Lack
of confidence and patience from the headquarters only made matters worse. “The
short-term approach to show quick results was talking its toll,” recalls a
Bangalore-based ex-employee who was involved in operations.
Worse, with $1 billion of
investments and having written off $450 million assets in 2000, penny conscious
Coca Cola headquarters began micromanaging issues like hikes. Recalls a senior
HR executive who worked in the eastern region: “No hikes above 10% at any
level—we got the message from the US headquarter.” Everything was in a flux—not
just in people leaving, in roles too changing frequently. There wasn’t much
flexibility that the HR department had in managing people.
Slowly, Mr. Singh (CEO, Coca
Cola, India) and his team are helping win back the staff confidence here and
getting some freedom from the Atlanta headquarters. “When I came, there were
complains of low salaries. We undertook a transparent benchmarking study to fix
that,” he says. Multiple channels of dialogues have been opened up. Every month
now, there is an open house meeting where all employees at the headquarters can
air their concerns and issues. “We are trying to bring down the decision-making
process,” says Mr. Singh.
Soften
that MNC Arrogance
Being the world’s most powerful brand had
its flipside. Every time there was a problem, the company pointed a finger
elsewhere. “We were in denial mode,” says a senior company executive. “Earlier,
we spent more time defending ourselves,” says a candid Mr. Singh. Despite
aggressive efforts it realised that in a sensitive business of food and drinks,
scientific data matter, but perceptions matter more. “No matter what you did,
it (pesticide issue) was a losing proposition,” says a senior ad industry
executive. “You could only side-step it to minimise the damage,” he adds. The
company too seems to have figured that out. “Let’s focus on solutions instead
of debating if we are part of the issue or not,” says Singh. Coca Cola is
trying to move beyond the blame game and has learnt to be more constructive.
Engage
Beyond Business
For both Pepsi and Coca Cola the world
was small and their attention very focused on each other. Just then CSE, an
NGO, expanded and complicated their business playfield in India. Suddenly their
MNC tag became a noose as the cola glitz and glamour gave way to pesticide,
pollution, groundwater depletion controversies. Having learnt lessons the hard
way, Coca Cola is now opening up channels of dialogue and engagement with the
community it is operating in. it is setting up a Coca Cola Foundation that will
engage in a variety of developmental work. To help create employable talent, it
is setting up Coca Cola Retail University that will train sales staff. It
organises rural games with a consortium of Indian farmers in the South. Water
conservation and recycling have become its pet projects even as it aspires to
become a net zero water user by 2009 in India. “We want to build a sustainable
business model in India,” says Singh.
Perhaps, the highs of the
past may never return. India and Indians’ fascination for the West and MNC
brands like Coca Cola today may have more earthy—rather than heady—appeal. Of
course, the brand itself has come down from its pedestal. “Coca Cola was an
insignificant product delivered spectacularly,” says an ad industry veteran.
The celebrity endorsements, ad campaigns and their cricket-connect made them
glitzy and desirable. “Soon, they came to be seen as frivolous without being
pleasurable,” he adds, just when “cooler” brands like Google and Nokia overtook
it. From such lows, a company can only go up. Coca Cola India is already
beginning to. Hopefully, Atlanta’s confidence in India's growth story will be
strong and long-term. And that the global beverage leader – after a slew of bad
publicity and poor business track record—has gained a humble confidence to
chalk up a successful business in India. For a company with a such a difficult
past in India, this may yet be early days.
But the management is upbeat.
Neville Isdell, chairman and CEO of Coca Cola, said its India arm registered a
double-digit growth in the first quarter this year after a series of negative
growth. Earlier in Atlanta it announced that India will be the No.3 market for
the company. The company will invest close to $250 million in the next three
years—and this is just the beginning. Today things are working for the company.
For the CEO, it is good news everywhere.
This could well be the third
awakening in India for the world’s largest beverage company. (Forced out of
India in the 1970s, Coca Cola re-entered in 1993 sinking $1 billion in over a
decade. It began losing its fizz since 2003 when pesticide allegations first
surfaced). But finally, after negative sales growth on the back of public
backlash, surging attrition (around 30%) and internal chaos, the company seems
to be steadying its feet in the Indian market.
Question:
As HR manager, what role do
you carve for yourself in making Coca Cola a number one cola company in India?
CASE
2: Prejudices in Workplace: Real or Perceived?
Manjula Srivastav had been head of
marketing for the last four years at Blue Chips, a computer product firm. The
company’s turnover had increased by two-and-a-half times during the period and
its market share in a number of products had also moved up marginally. What was
creditable was that all this had happened in an environment in which computer
prices had been crashing.
Although she had a talent for
striking an instant rapport with people—particularly with the company’s
dealers—Srivastav often found herself battling against odds, as she perceived
it, as far as her relationships with her subordinates and peers in the company
were concerned. Srivastav had to fight male prejudice all the way. She found it
unfair that she had prove herself regularly at work and she used to make her
displeasure on that score quite obvious to everyone.
Six months ago, Blue Chips
had been taken over by an industrial group of business interests and was, more
importantly, flush with funds. The change of ownership had led to a replacement
of the managing director, had his priorities clear. “Blue Chips will go
international,” he had declared in the first executive committee meeting, “and
exports will be our first concern.”
Prakash had also brought in
Harish Naik as his executive assistant with special responsibility for exports.
Naik had been seconded to Srivastav for five weeks as a part of a
familiarisation programme. Much of her surprise, he had been appointed, within
two months, as the vice president (exports), with compensation and perks higher
than her own. Srivastav had made a formal protest to Prakash who had assured
her that he was aware of her good work in the company and that she would have
an appropriate role once the restructuring plan he was already working on would
be put into effect.
One morning, as she entered
the office and switched on her workstation, a message flashed on her screen. It
was from Prakash. “Want to see you sometime today regarding restructuring. Will 2.30 be convenient?” It
went.
Later at his office, Prakash
had come straight to the point. He wanted to create a new post called general
manager (public affairs) in the company. “With your excellent background in
customer relations and connections with the dealer network, you are the ideal
material for the job,” he said, “and I am offering it to you.” Srivastav was
quick to react. “There is very little I can contribute in that kind of job,”
she said. “I was in fact expecting to be promoted as vice president (home
marketing).” Prakash said that the entire gamut of marketing functions would be
looked after by Naik who would have boardroom responsibility for both domestic
and export sales. “If you continue in marketing , you will have to be reporting
to Naik which I thought may not be fair
to you. In any case, we need someone who is strong in marketing to handle public
affairs. Let me assure you that the new post I am offering will in no way
diminish your importance in the company. You will in fact be reporting to me
directly.”
“You are being unfair and you
are diminishing my importance in the company,” reported Srivastav. “You know
that I am a hardcore marketing professional and you also know I am the best.
Why then am I being deprived of a rightful promotion in marketing? Tell me,”
she asked pointedly, “would you have done this to a male colleague?”
“That is a hypothetical
question,” said Prakash. “But I can’t thin of any other slot for you in the
restructuring plan I want to implement except what I am offering.”
“If the reason why you are
asking me to handle this fancy public affairs business of yours,” said
Srivastav, “is that you can’t thin of any other slot for me, then I would have
second thoughts about continuing to work for this company.”
“May I reiterate,” said
Prakash, “that I value your role and it is precisely because of this that I am
delegating to you the work I have been personally handling so far? May I also
state that I am upgrading the job not only because it is important but also
because it should match your existing stature in the organisation?”
“I need to think about this.
I will let you know tomorrow, said Srivastav and left the office.
Question:
What should she do?
CASE
3: Travails of a Training Manager
Ashwin Kumar, who had recently joined
Systems, as a training manager, was feeling uneasy at the end of his first
meeting with Pesu Shroff, the managing director of the company.
Systems was a ten-year old
unit employing 300 people. It had a turnover of Rs 25 crore the previous year.
The company traded in several products—both domestic and imported. Nearly 80
per cent of its turnover came from selling electronic component products which
were assembled locally from imports of semiknocked-down kits. The landed cost
of its imports was about Rs 10 crore last year. The products had an assured
demand in the country, with smuggled goods from Taiwan and Korea providing
whatever little competition there was. The company had been operating in a
seller’s market for years and, as a result, most of its activities were
production oriented rather than market oriented.
Early during the current
financial year, the Government of India had announced, as a part of its
economic liberalisation strategy, several policy measures which made imports
costlier. All imports had to be financed by exports – there were restrictions
on margin money and interest rates for working capital had shot up at one
stroke. With little export income in its account, Systems had no choice but to
discontinue importing SKD kits.
The company management had
three option before it. First, to build up its domestic trading activity
rapidly; second, to assemble at least a few of the component products from raw
materials sourced locally and third, pursue after-sales service aggressively
both to generate revenue in the short run and to establish an enduring
client-base for the company’s products in the long run.
Invariably, this meant that
the survival of Systems depended on how quickly it could train its
people—beginning from a handful of sales engineers—to become market-centred and
customer-friendly in their approach to business.
“The days of easy revenue money
are over for us,” Shroff had told Kumar, who had a formal training in HRD and
had been an officer in the training cell of a multinational firm before signing
up with Systems. “We have to compete now in the marketplace and sell hard to be
able to secure orders. Times are changing. We have to change too. And that is
where you come in. it will be your responsibility, as the training manager, to
ensure that people here acquire marketing skills,” he said, adding, as a
clincher, “Frankly, have always felt that a salesman is born, not trained. I
have had no belief in non-technical training. In fact, have found no need so
far for a training manager at Systems. But I am prepared to do anything to get
more sales.”
That punching was what had
made Kumar uneasy. But he decided to let it pass. Over the next few days, Kumar
got busy evolving specific training packages for workers, shop-floor
supervisors, administrative staff and senior functional executives and an
intensive module for field salesmen. Deciding to start with the salesmen first,
he met the sales manager to ask him to depute 10 salesmen for a training
session the next day. The sales manager was skeptical and only half-heartedly
consented to release people for the two-day training.
The session was a disaster.
No one showed any interest in the proceedings. In fact, one of the salesmen
came up to him during the coffee break and said, “You see, all this is a waste
of time. Take the client for a drink and you get the sale. It is as simple as
that. It has worked in the past and it will work in the future.” Kumar laughed
it off but the message had been delivered.
The attendance of the second
day session was thin. This lack of interest was again obvious at the session
for workers next day. The works manager who had originally agreed to the idea
was vague about the absence of so many workers at the training session. “They
are sick, I believe,” he said, making no attempts to hide his feeling that to
him the whole thing was a big joke.
Kumar had encountered such resistance
in the company where he had worked earlier. He also knew that his training
capsule was very effective. He was aware that training needs were universal for
all companies and so were the training techniques which were also easily
transferable from one set of working conditions to another and from one
industry to another. He also knew that he had the aptitude and interest to
become a professional trainer.
But Kumar began to realise
that he had made a few tactical errors in this particular case. He should have
perhaps asked Shroff to personally inaugurate the training session to give the
whole exercise an air of formality and, more importantly, of authority. He
should have perhaps started with the module for senior executives first.
“I must find a way out of
this and bring everyone round. There is simply no way I am going to accept
failure. Whatever damage there has been must be undone. I must do something,”
he said to himself.
Question:
What should he do?
CASE
4: The Resentful Employee
It was a bitterly cold night, and even at
the far end of the bus the east wind that raved along the street cut like a
knife. The bus stopped, and two women and a man got in together and filled the
vacant places. The younger woman was dressed in sealskin, and carried one of
those little Pekinese dogs that woman in sealskin like to carry in their laps.
The conductor came and took the fare. Then his eye rested with cold malice on
the beady-eyed toy dog, I saw trouble brewing. This was the opportunity for
which he had been waiting, and he intended to make the most of it. I had marked
him as the type of what Mr. Wells has called the Resentful Employee, the man
with a general, vague grievance against everything, and in particular, a
grievance against passengers who came and sat in his bus while he shivered at
the door.
“You must take that dog out”,
he said with sour venom.
“I shall certainly do nothing
of the kind. You can take my name and address”, said the woman, who had
evidently expected the challenge and knew the reply.
“You must take the dog
out—that is my order”.
“I won’t go on the top in
such weather. It would kill me”, said the woman.
“Certainly not”, said her
lady companion. “You have got a cough as it is”.
“It is nonsense”, said her
male companion.
The conductor pulled the bell
and the bus stopped.
“This bus does not go on
until that dog is brought out”. And he stepped on the pavement and waited. It
was his moment of triumph. He had the law on his side and a bus-full of angry
people under his thumb. His embittered soul was having a real holiday.
The storm inside rose high.
“Shameful”, Why is not he in the army?” “Call the police”, “Let us all report
him”, “Let us make him give us our fares back”, “Yes, that is it, let us make
him give us our fares back”. Everybody was on the side of the lady and the dog.
That little animal sat
blinking at the dim lights in happy unconsciousness of the rumpus of which he
was the cause.
The conductor came to the
door. “What is your number?” Said one taking out a pocket-book, with a gesture
of terrible things, “There is my number”, said the conductor unperturbed. “Give
us our fares back—you have engaged to carry us—you can not leave us here all
night”. “No fares back”, said the conductor.
Two or three of the passengers
got out and disappeared into the night. The conductor took another turn on the
pavement, then went and had a talk with the driver. Another bus, the last on
the road, sailed by, indifferent to the shouts of the passengers to stop. “They
stick by each other, the villains”, was the comment.
Some one pulled the bell
violently. That brought the driver round to the door. “Who’s conductor of this
bus?” He said and paused for a reply. None coming, he returned to his seat and
resumed beating his arms across his chest. There was no hope in that quarter. A
policeman strolled up and looked in at the door. An avalanche of indignant
protests and appeals burst on him. “Well, he has got his rules you know”, he
said generally. “Give your name and address”, “That is what is being offered
and he won’t take it”. “Oh”, said the policeman, and he went away and took his
stand a few yards down the street, where he was joined by two more constables.
And still the little dog
blinked at the lights, and the conductor walked to and from on the pavement
like a captain on the quarter-deck in the hour of victory. A young woman whose
voice had risen high above the gale inside, descended on him with an air of
threatening and slaughter. He was immovable as cold as the night and hard as
the pavement. She passed on in a fury of importance to the three policemen who
stood like a group of statuary up the street watching the drama. Then she came
back, imperviously beckoned her “Young man” who had a silent witness of her
rage, and vanished. Others followed. The bus was emptying. Even the dashing
young fellow who had demanded the number, and who had declared he would see
this thing through if he sat there all night, had taken an opportunity to slip
away.
Meanwhile the Pekinese party
was passing through every stage of resistance to abject surrender. “I will go
to the top”, said the sealskin lady at last. “You must not.” “I will”. “You
will have pneumonia”. “Let me take it” (This from the man). “Certainly not—she
would die with her dog”. When she had disappeared up the stairs the conductor
came back, pulled the bell, and the bus went on. He stood sourly triumphant
while his conduct was savagely discussed in his face by the remnant of the
party.
Then the engine struck work,
and the conductor went to the help of the driver. It was a long job, and
presently the lady with the dog stole down the stairs and re-entered the bus.
When the engine was put right the conductor came back and pulled the bell. Then
his eye fell on the dog and his hand went to the bell-rope again. The driver
looked around, the conductor pointed to the dog, the bus stopped, and the
struggle recommenced with all the original features, the conductor walking the
pavement, the driver smacking his arms on the box, the little dog blinking at
the lights, the sealskin lady declaring that she would not go on the top and
finally going.
Questions:
1.
Which
theory of motivation do you use to motivate the bus crew? Why?
2.
If
you were the conductor what would you do?
3.
If
you were the lady with the pet dog, what would you do?
4.
Role
play (a) the conversation between the conductor and the lady with sealskin,
(b)
between policeman and the fellow passengers, and
(c) between the conductor and
the driver.
CASE
5: Protest Over Job Losses
Bitter it may taste, shrill it may sound,
and sleepless nights it may cause, but it is true. In a major shake up,
Airbus—the European aircraft manufacturer—has thrown a big shock to its
employees. Before coming to the details of the shock, a peep into the company’
resume.
Name: Airbus
Created: 1970
President CEO: Louis
Gallois
Employees: 57,000
Turnover (2006): 26
bn (Euro)
Total aircraft sold (Feb.2007): 7187
Delivered: 4598
Headquarters: Toulouse (France)
Facilities: 16
Rival: Boeing
Airbus announced on February 27, 2007,
that it would shed 10,000 jobs across four European countries and sell six of
its units. On the same day the hapless workers did what was expected of
them—downed tools and staged protests. The protesting workers at Airbus’s
factory at Meaulte, northern France, were seen picketing outside the factory
gate after holding up production a day earlier. To be fair to Airbus, its
management entered talks with unions before the job loss and sale was formally
announced. But the talks did not mollify the agitated workers.
Job shedding and hiring of
units are a part of Power8 restructuring plan unleashed by Airbus to save
itself from increasing loss of its grounds to the arch rival, Boeing Co.
Airbus’s Power8 strategy was
first mooted in October 2006, but sparked a split between France and Germany
over the distribution of job losses, and the placement of future ones. Later,
the two countries agreed to share both job losses and new technology.
The Power8 plan, if
finalised, would mean a 9 per cent reduction to Airbus’s 55,000 employee
strength.
Questions:
1.
Why
should Power8 focus on shedding jobs to save on cost? Are there no alternative
strategies?
2.
Will
the proposed shedding of jobs and sale of six units help Airbus survive the
intense competition from Boeing?
CASE
6: The Office Equipment Company
Office Equipment Company (OEC) must
identify a manager to help set up and run a new manufacturing facility located
in the Palestinian-controlled Gaza Strip. The position will have minimum
duration of three years. OEC manufactures office equipment such as photo
copying machines, recording machines, mail scales, and paper shredders in eight
different countries. OEC’s products are distributed and sold worldwide.
Currently, OEC has no
manufacturing facility in Middle East but has been selling and servicing
products in Israel since the early 1970s. OEC sells its products in Israel
through independent importers, but is now convinced that it needs to have a
local manufacturing facility in order to take full advantage of the new, more
peaceful situation in the region. Despite occasional turmoil that interrupts
new moves towards peace, OEC’s sales in Israel have been improving, with
increase in profitability. OEC has recently been contacted by distributors in
Jordan and Egypt about possible sales of OEC products. Incentives for foreign
direct investment in Gaza Strip could help OEC develop extensive operations in
the region at considerably reduced cost.
OEC hopes to begin
constructing a factory in Gaza Strip within the next six months. This factory
would import products and assemble them. The construction of the assembly plant
would be supervised by an US technical team and a US expatriate would be
assigned to direct the production. This expatriate manager would report
directly to the headquarters of OEC at US.
The option of filling the
position of managing director with someone from outside the firm is alien to
OEC’s policy. Otherwise the options are fairly open. OEC uses a combination of
home-country, host-country, and third-country nationals in top positions in
foreign countries. It is not uncommon for managers to rotate among foreign and
domestic locations (in the US). In fact, it is increasingly evident that
international experience in an important factor in deciding the persons who
will be appointed to top corporate positions. The sales and service operations
in Israel have been controlled through OEC’s European regional office located
in Podernone, Italy. A committee at the European regional office has quickly
narrowed its choice to the following five candidates.
Tom
Zimmerman Zimmerman joined the firm 30 years ago and
is well-versed in all the technical aspects required for the job. Zimmerman is
a specialist in start-up projects, and has supervised the construction of new
manufacturing facilities in four countries. He has never been assigned to work
abroad permanently. His assignments have usually been in developed countries
and for periods of less than six months. He is considered to be extremely
competent in the duties he has performed during the years, and will retire in
about four-and-a-half years. Neither he nor his wife speaks any language other
than English—their children have grown and are living in the US. Zimmerman is
currently in charge of an operation about the size that the one in Gaza Strip
will be after the factory begins operating. However, as that operation is being
merged with another, this present position will become redundant.
Brett
Harrison At age forty, Brett has spent 15 years
with OEC. He is considered highly competent and capable of moving into
upper-level management within the next few years. He has never been based
abroad but has frequently travelled to Latin America. Both he and his wife
speak Spanish adequately. Their two children, aged fourteen and fifteen, are
just beginning to study Spanish. His wife is a professional as well, holding a
responsible marketing position with a pharmaceutical company.
Carolyn
Moyer Carolyn joined OEC after getting her BS
in engineering from Purdue University and an MBA from the prestigious Bond
University in Australia. At the age of 37, she has already moved between staff
and line positions of growing responsibility. For two years, she was the
second-in-command of a manufacturing plant in Texas about the size of the new
operation in Gaza Strip. Her performance in that post was considered excellent.
Currently, she works as a member of a staff production planning team. When she
joined OEC, she had indicated her eventual interest in international
responsibilities because of a belief that it would help her advancement in
career. She speaks French well and is not married.
Francis
Abhrams Francis is currently one of the assistant
managing directors in a large Mexican operation, which produces for and sells
to the Mexican market. He is a Jewish New Yorker who has worked for OEC in
Mexico for five years. He holds an MBA from New York University and is
considered to be one of the likely candidates to head a Guatemalan operation
when the present managing director retires in four years. He is 35, married
with four children (ages two to seven). He speaks Hebrew adequately. His wife
does not work outside the home and speaks only English.
Leon
Smith At
30, he is assistant to the managing director at the Athens manufacturing
facility, a position he assumed when he joined OEC after completing his
under-graduate studies in the US seven years ago. He is considered competent,
especially in production operations, but lacks in managerial experience. He was
successful in increasing OEC’s production output in Athens during his tenure in
Athens. Leon travelled extensively in the Middle East. He went to the college
with a number of students from Saudi Arabia, Jordan, and Egypt. These individuals
came from prominent political and business families in their countries, and
Leon has visited them during his travels. He thus has the advantage of being
reasonably well-connected with influential families in the region. He is not
married.
Questions:
1.
Whom
should the committee choose for the assignment and why?
2.
What
problems might each individual encounter in the position?
3.
How
might OEC go about minimising the problems that the chosen person would have in
managing the Gaza Strip operations?
Assignment Solutions, Case study Answer sheets
Project Report and Thesis - Contact
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