E-magazine Of The Department Of Mhrm, Iiswbm_september 2009
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"All forces, powers, and energies are neither good nor evil in themselves. They are completely neutral, but only become good or evil when they are intelligently directed."
Man is himself the master of his actions, of his doing, of his fate. Like the saying goes, any thought, any act, or any deed, does not come with a good and an evil tag, it is what we make out of that particular thing which entitles it as something “Good” and “Evil”. But is it true that what matters at the end of the day is just the triumph of Good over Evil? Even the stressed conscience inside us which is tired with the daily humdrums, believes that ultimately, it is the victory of the Good. Be it, the penultimate climax especially in a Bollywood movie where the Hero finally stands up against all odds and “Dishoom Dishoom” the villain away.. or to see the Ravana effigy ablaze, every year as a part of the Dussehra celebrations in the Red Fort Grounds.
We, Team E-mag!ne believe that YES !! However silly it might sound, the Good does finally triumph over the evil forces, and Virtue is the ultimate victor. Good people have happy lives, have more friends, are happier than usual and live longer than usual. As from a Devil’s Advocate point of view, there might be exceptions, but those are very short-lived. And one’s actions would define what is GOOD or EVIL. Thus as the famous saying goes: “One shall reap, what one sows”
This fight between Good and the evil and the desire to vanquish the BAD, dates back from the pages of Ramayana and Mahabharata. But if we spare a thought, we would find there are umpteen questions that lie on the path.. For once E-mag!ne puts forth those questions to YOU !!!
Tell us :
What do you think of the consistent fact of life that “Good triumphs over Evil”?
Do you think that an individual’s fate is decided by his actions?
Do Good people always succeed in Life?
Page 2
And do people who follow the evil always fail?
Just E-mag!ne.. and you should be ready with and answer !
This month, Team E-mag!ne would like to welcome aboard its new members
Ms. Kirti Agarwal
Ms. Malini Sengupta
Mr. Debjit Basu
And would like to thank them for their contribution to this edition of E-mag!ne.
May this festive season fill your lives with happiness, love and prosperity.
Page 3
# From the Alumni Desk……………………..…………….5 # Friends from Yonder……………………………..………8 # The aging Machiavel………………….………….……...11 # Experimentation of Qualities…………………….....….....13 # Q%Quotient………………………............................................15 # Ace the Case………………………..………..……..……..17 # Campus Bytes…………………………………....…..…....19 # Feedback…………………………………………..……..20
Page 4
ETHICAL ISSUES IN HUMAN RESOURCES MANAGEMENT Munmun Maheseka, MHRM 2006-2008 “An employee who on joining discovers that senior managers are submitting inflated travel bills. The new employee is encouraged to do likewise. He has now to make a choice. Should he obey his seniors and submit travel bills or should he be honest in claming travel allowance and thereby expose his superiors.” Dilemmas like this and numerous others occurs every day in an organization and at the workplace What would one do in each case? What would you want your employees to do?. Here comes the HR Intervention. Many organizations doesn’t flout the law while taking business decisions, but at the same time it invites ethical scrutiny. The treatment of its employees, customers by them acts as a litmus test for its ethicality. Generally an employee spends more time in producing goods and in building relationship to attain long term value rather than getting into ethical issues. Ethical treatment of employees does not necessitate taking maximum care to employee satisfaction instead it covers various issues related to employment contract, principle of ethical selection of hiring and even firing, remunerations, discrimination. Let us now dwell a bit into all the above aspects which primarily concern the HR professional of an organization. Employability It is normally done through a well written legal contract duly documented spelling out the tasks and responsibilities, remuneration, hours of work, location, travel requirements etc. Although the employment contract concentrates on the exchange of salary for work, its is however generally accepted that a business has an obligation to continue providing work to its employee as long as it is viable for the business. Organisation giving lifetime employment aims for stability rather than rapid growth. Though lifetime employment leads to higher employee loyalty and productivity but it is now becoming questionable whether its helps business in fulfilling its obligation. Similarly, employee like employer too has certain responsibilities. A casual labourer responsibility may be limited to doing work for which he is paid but
Page 5
permanent employee is expected to have some degree of loyalty to business which provides him job security, a sense of belonging and prospects growth and well being while in employment. Selection The approach should be to follow the correct principle of selection, perceived as having the ability to contribute to most to the organisation. This principle of selection equally applies to other HR related activities like promoting able employees and deciding who should be laid off. Ethical selection demands acting in honest, fair, non coercive and legal way. Non conformation to ethical selection may lead to entry of wrong candidate. Dissatisfaction thus breeds amongst employees which in turn may lead to wastage of both men and material. In selecting the right person the recruiter’s job is not just rejection of wrong candidate but accepting the best among the available. The process may continue till search for suitable candidate is over. Discrimination The first step towards ethical selection is to prevent discrimination. Firing, if needed, then adequate care must be ensured that discrimination is based on relevant criteria. The question then arises, what are the relevant criteria for ethical selection? It is definitely the functional qualities or abilities; for example, the ability to teach for a teacher, for an actor to act, painter to show his ability for painting etc. Similarly the character too plays an important role in selection of a person for the department like purchase, police etc, Referral, though beneficial to business, becomes unethical as it deprives entry of good candidates. Over qualification, ageism too are discriminatory in nature. Equality of opportunity, use of coercion, rejection for reason other than those laid down by the rules also encourages discrimination. Whatever justification a business may have for adopting discriminatory hiring practices, these practices always go against the principle of ethical selection. Remuneration An ethical business does not reward anything other than results. An employee’s needs, efforts, ability, seniority and loyalty is of no importance in deciding his remuneration unless it plays a role in achieving results. Equitable remuneration plays a crucial role in employee motivation. All remuneration which is just and equitable is considered ethical. A person with pressing needs, mere position of superior skills and abilities to hard work but no result all these deserves no reward. Business can help employee who are in problems by giving ‘remedial’ benefits like loans, grants, medical assistance etc which are clearly distinguished from standard remuneration. A business should reward those who willingly forego their benefits, perks in times of organizational financial crisis but it will be unethical for the business not to protect them and dishonour their commitment when it is back on rail. Retrenchment
Page 6
The ‘ at will ‘ or for a ‘cause’ clause in the employment contract may be devastating effect on employee morale but it is considered ethical when the dismissal is aimed at maximizing long term owner value. Firing to be ethical should be honest, fair, legal and without coercion or physical violence. It is a very critical decision affecting the reputation of the organization. Trust is at stake if an unethical approach is adopted, which is essential for business to survive and make profits. Poor performance, acts of sabotage, dishonesty or misuse of authority is ethical ground for firing. Issues are varied and plenty. We HR professional need to keep abreast with the ethical and unethical principles well demarcated for transparency, consistency and cordiality in the organization.
Page 7
STEEL- MADE IN CHINA?? With every passing day I think when the recession will take back its curse. When will the potential candidates get employed without having to behave like beggars on street % those who spent huge amount of money to enhance their skills and knowledge so as to beat the other competitors fighting for the same positions? A small example of how the clubs of the business schools have been affected by Sub Prime (a sneak into the club discussions in our business school): Be it the Strategy club where we discuss which are the companies who were recession proof and what strategy they had applied to do the same or the Finance Club where we discuss the Sub%prime crisis, Lehman Bros. case, Great depression, Balance Sheet Reviews of companies etc. etc. Be it directly related to the topic or not finally we derive the Sub%prime effect on the topics. Leaving apart these trivial issues let’s focus on the impact of the same on Global Economy. Just a small peak in one of the most hit sectors of the world: Infrastructure Development has been falling in countries like US and UK since the economic bubble burst in the last year. This in return is affecting the steel industry in an adverse way. The steel manufacturers are thus forced to contract their supply in the current fiscal year. We can see reduced growth prospects for the steel manufacturers all over the world. This in turn is leading to fall in steel
Page 8
price. Steel manufacturers are recording losses in their first quarter results. Let’s see which nation looks most prone to face the hit. In order to have a clear picture of the same let us see the steel production scenario globally in the last fiscal. The following figures are derived from Iron And Steel Statistics Bureau's monthly reports as published in the month August 2009. The five main steel producing countries of the Far East showed varying production with both China and India showing an increase. 1. China's June steel production showed an increase of 6% to 49.4 million tonnes which contribute to 49.5% of the world's total steel production. 2. Crude steel production in Japan declined by a third in June with the year to date total down 40.7% to 36.7 million tonnes. 3. India has now become the third largest steel producing country in the world with June production up 5.7%, bringing the year to date total to 27.6 million tonnes, an increase of 1.3%. 4. South Korean steel production was down 14.4% in June, and by 17.3% in the year to date to 22.8 million tonnes. 5. Taiwanese production decreased by 29.5% in June and by 39% in the six months to 6.6 million tonnes. Australian crude steel production dropped by 52% in the first six months to 1.9 million tonnes. An overview on the past steel production dips: The biggest fall in demand over one year for the steel industry since the end of the Second World War was the 8.7 per cent drop in 1982, towards the end of a downturn in global industry. That was the third consecutive year in which steel industry output fell. There have been only three occasions since 1900 when output has declined for three years in a row. Similar slump periods for the industry were 1930% 32, 1944%46 and 1990%92. Production of crude steel for the countries reporting to the World Steel Association in June 2009 was estimated to be 99.8 million tonnes, a decrease of 16% over June 2008. China accounted for almost half of the global production of steel in 2009, the year to date total fell by 35%. All regions showed a drop in both June and the year to date totals except for that of Middle East. On the other hand if we compare the steel production contraction we will see a decline in the contraction rate. China followed by India is seen to be the most sensitive in this sector at this point of time. This can be very well validated by the first news I came through in the newspaper on the morning of 28th August: DEMAND SLUMP HITS TATA STEEL Q1 NET The company recorded a consolidated loss of Rs. 2209 Crores in the first quarter of the fiscal. If you carefully see the balance sheet of the Company for the quarter ended June 2009 we will see Raw Material cost contributing 38% of the total expense of Tata Steel Ltd. alone and when we look at the consolidated Balance Sheet it is around 29% of the total expense. The consolidated figure gives us the
Page 9
raw material contribution to the business of both Tata Steel Ltd. and Corus. So if we try to arrive at the percentage that Raw material contributes to only Corus it will be around 20%. This means that the rotation of stock is very low due to fall in demand for the finished product in Tata Steel. Even though you say it might be the distance coverage expense that is high in case of Tata Steel while procuring raw materials I would say it can’t throw up such a high difference. Mr. Laxmi Narayan Mittal is still optimistic about the growth in steel sector in the current fiscal.
Page 10
THE AGING MACHIAVEL The art of government is the organization of idolatry. Liberty means responsibility. That is why most men dread it. Vice is waste of life. Poverty, slaughter and celibacy are some canonical vices. Economy is the art of making most of life. The love of economy is the root of all virtue. Political Economy and Social Economy are amusing intellectual charades but Vital Economy is the Philosopher’s Stone. Does every manager realize the miracles of Vital Economy brought about by simplest tools of personnel management? If he doesn’t, the moment the manager deliberately injures, the injured leapfrogs with the politics initiated and empowers himself to dissect the canonical vice of Machiavellianism in Management. Not only was the Machiavellian schemer an anti%hero on the erstwhile Elizabethan stage but is also looked down upon as a bogeyman in today’s corporate scenario. A number of formulae have been invoked to account for the declining influence of Machiavellianism in the 19th and 20th centuries. The simplest and most capacious is simply that the world has been Machiavellianised. When moral principles ceased to be independent, unchanging public rules controlling the behaviour of those who professed them%%%when principles were replaced by ideas of interest, progress or class solidarity%%%then Machiavellianism lost most of the brownie points it had earned in the times of Shakespeare penning Macbeth. The modern political liar isn’t Machiavellian; he doesn’t even want to deceive; he is simply telling his constituency what it wants to hear. That’s his business. Machiavellianism is only possible only in an age of public morality or at least of moral expectations and that is not our own. Again, why did Machiavelli recommend that a prince (read the CEO in the present context) must be ready to be cruel and devious? He himself gives the answer: in the long run, this is often kinder than to expose citizens (staffers in an organization) to the turmoil let loose by a weak ruler. Read it in Machiavelli's own words: "A man who wishes to make a profession of goodness in everything must necessarily come to grief among so many who are not good. Therefore it is necessary for a ruler, who wishes to maintain himself, to learn how not to be good, and to use this knowledge and not use it, according to the necessity of the case". The operative phrase here is, "according to the necessity of the case", which in other words means, "it all depends". Your management style cannot be straitjacketed and
Page 11
has to change as the situation demands. Even the worst of Machiavelli's critics should find nothing wrong with these arguments. After all, expediency is the name of the game in effective management. Hence we still maintain that the end justifies the means but in most certainty, this conniving and injuring concept of management is on its way to speedy erosion. The present day online job consultancy unit, namely, ‘www.monster.com’ clearly fuels the mind to actually identify the latent Machiavellian streak in corporate employers’ couches that the employee wants to do away with, slash it to oblivion if possible. Machiavellianism is the mirror of the world today; bizarre and grotesque where ethical principles are pitiably, dependent variables. We do not need an alibi to be shrewd and scheming anymore. It IS expected out of us as it is an extension of one’s corporate personality. Machiavellianism is no longer a tact device. The pocket handbook of a scheming Manger just got reduced into parchments of antiquity.
Page 12
Experimentation of Qualities… The success of a manager depends on certain qualities. All of us try to achieve those objectives we set in our mind. In order to achieve those objectives we often neglect certain other attributes which help us to build our character, our morale, our social image. We put emphasis on our short term goal completely forgetting the long term goal. Sometimes we feel we can never be in the line of honesty being a part of this rustic, filthy corporate society. We can never be honest; we have to manipulate norms and rules in order to proceed further in our career. However my experience with corporate honchos doesn’t support that view at all. Instead most of the companies emphasize building relationship with employees to retain them in the organization for long. Here the qualities play a very important role to decide upon our career. These few qualities are% Honesty Openness to learning Flexibility Communication skill All of us possess these qualities to some extent but what we don’t realize is that we do not follow those qualities and it fades out. We do not understand the magnitude of these qualities and focus on short term gain. Instead we should extensively depend on these qualities and build our future. My small experience with India Inc voices the same. Talking to an HR head of a company it is understood that India Inc banks on honesty and transparency. Honesty and integrity are the two key factors to be successful. We all try to get money and prosperity in our life but by dishonest means. But in the long run we find ourselves in the failure side. The very examples of Satyam scam is a perfect example of it. Being a part of the corporate we should be open to accept the changes. We need to fit ourselves in the role designed to us. We should understand the demand and incorporate changes on that basis. The recession post India is more open to accept changes and so as we.
Page 13
To fit ourselves in the ever changing world we need to be flexible. Now a day the India Inc is more interested in people having multi skill than specialist. We need to acquire a set of skill to fulfill a variety of business needs. The role of an HR manager is not restricted to preparing excel sheet for monthly pal role for their employees. Instead they cover an extensive ground ranging from performance appraisal to employee relation to legal initiatives. What I fond out is that the proper communication skill differentiates the best from others. When we talk about communication we think excellent fluency, flowery language. But the thing we ignore is the timing of the delivery. We must keep it in our mind that to be a strong speaker one has to be very specific about his speeches. There is always a right time to speak on a subject which could be a mess if delivered inappropriately or at the wrong time. The learning is an ongoing process. It can never be stopped. We enrich our knowledge by experiences with the help of certain qualities which we need to sharpen continuously. The best way to get success is to face as many challenges as possible.
Page 14
Winner Q-Quotient August 2009!
Debjit Basu, MHRM 2009-11
Answers to August Q-Quotient 1. Ethos Water 2. Aids Prevention and Treatment 3. Mercy Ships 4. Merry%Go%Round 5. Micro%credit Lending 6. Livestock, Agricultural Training and Seedlings 7. Larsen & Toubro (L&T) Ltd. 8. ITC Limited 9. ICICI Bank 10. Namma Shaale
Page 15
Septembert 2009 Q-QUOTIENT
If you think you have the grey matter that matters, then mail us the answers to the following questions at [email protected]. The entry with the maximum number of correct entries will witness his/her name and picture in this space in the next edition of E %mag!ne. So its time to let the world know your Q %quotient This month’s Q- Quotient is a special one dedicated to the city of dreams. That’s right.. Mumbai. Emag!ne would like to thank Mr. Debjit Basu for being the quizmaster for this very special edition of Q- Quotient.
MUMBAI-THE INSOMNIAC CITY 1.
The name Bombay was derived from a Portuguese word “BOM BAHIA”(The good bay).The name was given by a portuguese sailor in 1508.Who was he?
2.
Who was appointed as the First Governor General of Bombay by the East India company?
3.
The Quit India movement was launched by Gandhiji in Bombay in 1942 from Gowalia Tank.By what name is it known today?
4.
India’s first cricket club was founded in Bombay in 1848.What was it called?
5.
When a person travel towards Mumbai, one can see the milestone stating 35 kms., but where is Mumbai 0 km?
6.
Mumbai is made up of an archipelago of seven islands.which island is also known as “little Colaba”?
7.
Bombay was the headquarter of the East India Company in Western India from 1668%1858.When did it pass to Great Britain?
8.
The Gateway of India near the waterfront commemorates one”s visit in 1911?Who was it?
9.
When did Bombay become Mumbai?
10. The most popular food of Mumbai which derives its name from a Portuguese word meaning “bread”?
Page 16
This month’s Ace the Case section has two of our friends Ms, Kirti Agarwal, & Ms. Malini Sengupta preparing the case study for us. Keeping tabs to all your requests and interest in this section, we are delighted to inform that we would start publishing the answers to the questions of each of the cases posted here.. So friends… wait till the next month for this month’s solution of the Case.
PREMIER CHEMICALS Premier Chemicals is a Rs. 2000%crore company headquartered at Ahmadabad. The company is into manufacturing of bulk drugs as well as formulations, and markets its products across the country as well as countries in Europe and South Asia. The company is traditionally run and is fully controlled by promoters. However, with the advent of a competitive environment, the company felt the need for revamping its operations and restructuring the organisation structure too. The CEO in his meeting with the VP (Operations), VP (HR) and other departmental heads discussed and approved the revised organizational structure. The VP (HR) was given a period of 3 months for completing the revamping/recruitment process. The VP (HR) engaged an HR consultant and assigned them the following tasks: •
Mapping the existing business profile and strategy of the organization
• •
Mapping the competencies of the existing manpower Reviewing the requirements of the existing manpower vis%à%vis the new organisational structure.
• •
Identifying the competency and manpower gaps Retraining and redeploying of manpower
• •
Recruitment and additional manpower Preparing of position wise succession plan and a matching career plan for the employees
Page 17
The company recorded an average performance of only 17% increase in net sales and profit as against the envisaged target of 40%. The CEO in his annual review meeting with the departmental heads reviewed the situation, and during the course of brainstorming they identified the following: •
Some of the employees who did not possess the required level of competencies were recommended for promotion by the HR consultant and were promoted by the HR department with a view to comply with the recruitment and staffing target period.
•
A few of the new recruits were found to be leaking confidential to the competitors. A subsequent investigation revealed that some of them were actually implanted by the competitors.
QUESTIONS 1.
What was wrong with the revamping strategy of the company?
2. 3. 4.
What went wrong with the recruitment process? Did the company take the right step by engaging HR consultant? Who should be held accountable for the organizational debacle?
Page 18
“The world is a book, and those who do not travel read only one page” St. Augustine Indeed the truth cannot be more precisely stated. September has been a month full of travel and journey for a majority of the students of the Department of MHRM, IISWBM. The travel being talked about is the placement trips to the 3 different zones – West, North and South. The days before the travel began were the most hectic ones for the students of the department. The students were involved in a plethora of activities for the placement trips. Making calls to the companies for fixing appointments, collecting all data necessary for conducting the trips, compiling them all together, taking active part in creating the placement brochure, packing it and preparing it to be sent along on the trips and also planning the actual journey and arranging for the tickets, the students handled it all. Students slogged round the clock to make this trips happen and they learned a fair lot of things doing so. This phase of planning for the trips and the actual trip that follows teaches the students a lot about management, much more than perhaps any book can teach them. They are at their own handling events and making things happen. They have no guideline to tread carelessly along, they are always on their toes thinking, making plans, breaking plans and then re%planning. Whatever happens on the trips all the team members share the responsibility together. They work together as a team to cover impossible looking schedules, achieve deadlines and handle mounds upon mounds of big%small activities. End August the trips began with the South team setting sail, soon to be followed by the North and West teams in Early September. The trips saw the students working day in and day out to visit companies in their respective zones and trying to make the presence of the college felt. Each zone trip was different in the sense that the students had to adjust to completely different sets of cultures and norms. For the people on the trips each day was full of discoveries and new experiences. Traveling to unknown destination everyday, meeting corporate big%wigs, eating local food, taking in the local sights while traveling along… the sensory overload was delightful to say the least. Being on these trips gave the students a taste of the diversity that is India. Each zone was mighty different from Kolkata, wherefrom the trips began.
Page 19
Please write to us at [email protected] with your suggestion and feedback Page 20
Man is himself the master of his actions, of his doing, of his fate. Like the saying goes, any thought, any act, or any deed, does not come with a good and an evil tag, it is what we make out of that particular thing which entitles it as something “Good” and “Evil”. But is it true that what matters at the end of the day is just the triumph of Good over Evil? Even the stressed conscience inside us which is tired with the daily humdrums, believes that ultimately, it is the victory of the Good. Be it, the penultimate climax especially in a Bollywood movie where the Hero finally stands up against all odds and “Dishoom Dishoom” the villain away.. or to see the Ravana effigy ablaze, every year as a part of the Dussehra celebrations in the Red Fort Grounds.
We, Team E-mag!ne believe that YES !! However silly it might sound, the Good does finally triumph over the evil forces, and Virtue is the ultimate victor. Good people have happy lives, have more friends, are happier than usual and live longer than usual. As from a Devil’s Advocate point of view, there might be exceptions, but those are very short-lived. And one’s actions would define what is GOOD or EVIL. Thus as the famous saying goes: “One shall reap, what one sows”
This fight between Good and the evil and the desire to vanquish the BAD, dates back from the pages of Ramayana and Mahabharata. But if we spare a thought, we would find there are umpteen questions that lie on the path.. For once E-mag!ne puts forth those questions to YOU !!!
Tell us :
What do you think of the consistent fact of life that “Good triumphs over Evil”?
Do you think that an individual’s fate is decided by his actions?
Do Good people always succeed in Life?
Page 2
And do people who follow the evil always fail?
Just E-mag!ne.. and you should be ready with and answer !
This month, Team E-mag!ne would like to welcome aboard its new members
Ms. Kirti Agarwal
Ms. Malini Sengupta
Mr. Debjit Basu
And would like to thank them for their contribution to this edition of E-mag!ne.
May this festive season fill your lives with happiness, love and prosperity.
Page 3
# From the Alumni Desk……………………..…………….5 # Friends from Yonder……………………………..………8 # The aging Machiavel………………….………….……...11 # Experimentation of Qualities…………………….....….....13 # Q%Quotient………………………............................................15 # Ace the Case………………………..………..……..……..17 # Campus Bytes…………………………………....…..…....19 # Feedback…………………………………………..……..20
Page 4
ETHICAL ISSUES IN HUMAN RESOURCES MANAGEMENT Munmun Maheseka, MHRM 2006-2008 “An employee who on joining discovers that senior managers are submitting inflated travel bills. The new employee is encouraged to do likewise. He has now to make a choice. Should he obey his seniors and submit travel bills or should he be honest in claming travel allowance and thereby expose his superiors.” Dilemmas like this and numerous others occurs every day in an organization and at the workplace What would one do in each case? What would you want your employees to do?. Here comes the HR Intervention. Many organizations doesn’t flout the law while taking business decisions, but at the same time it invites ethical scrutiny. The treatment of its employees, customers by them acts as a litmus test for its ethicality. Generally an employee spends more time in producing goods and in building relationship to attain long term value rather than getting into ethical issues. Ethical treatment of employees does not necessitate taking maximum care to employee satisfaction instead it covers various issues related to employment contract, principle of ethical selection of hiring and even firing, remunerations, discrimination. Let us now dwell a bit into all the above aspects which primarily concern the HR professional of an organization. Employability It is normally done through a well written legal contract duly documented spelling out the tasks and responsibilities, remuneration, hours of work, location, travel requirements etc. Although the employment contract concentrates on the exchange of salary for work, its is however generally accepted that a business has an obligation to continue providing work to its employee as long as it is viable for the business. Organisation giving lifetime employment aims for stability rather than rapid growth. Though lifetime employment leads to higher employee loyalty and productivity but it is now becoming questionable whether its helps business in fulfilling its obligation. Similarly, employee like employer too has certain responsibilities. A casual labourer responsibility may be limited to doing work for which he is paid but
Page 5
permanent employee is expected to have some degree of loyalty to business which provides him job security, a sense of belonging and prospects growth and well being while in employment. Selection The approach should be to follow the correct principle of selection, perceived as having the ability to contribute to most to the organisation. This principle of selection equally applies to other HR related activities like promoting able employees and deciding who should be laid off. Ethical selection demands acting in honest, fair, non coercive and legal way. Non conformation to ethical selection may lead to entry of wrong candidate. Dissatisfaction thus breeds amongst employees which in turn may lead to wastage of both men and material. In selecting the right person the recruiter’s job is not just rejection of wrong candidate but accepting the best among the available. The process may continue till search for suitable candidate is over. Discrimination The first step towards ethical selection is to prevent discrimination. Firing, if needed, then adequate care must be ensured that discrimination is based on relevant criteria. The question then arises, what are the relevant criteria for ethical selection? It is definitely the functional qualities or abilities; for example, the ability to teach for a teacher, for an actor to act, painter to show his ability for painting etc. Similarly the character too plays an important role in selection of a person for the department like purchase, police etc, Referral, though beneficial to business, becomes unethical as it deprives entry of good candidates. Over qualification, ageism too are discriminatory in nature. Equality of opportunity, use of coercion, rejection for reason other than those laid down by the rules also encourages discrimination. Whatever justification a business may have for adopting discriminatory hiring practices, these practices always go against the principle of ethical selection. Remuneration An ethical business does not reward anything other than results. An employee’s needs, efforts, ability, seniority and loyalty is of no importance in deciding his remuneration unless it plays a role in achieving results. Equitable remuneration plays a crucial role in employee motivation. All remuneration which is just and equitable is considered ethical. A person with pressing needs, mere position of superior skills and abilities to hard work but no result all these deserves no reward. Business can help employee who are in problems by giving ‘remedial’ benefits like loans, grants, medical assistance etc which are clearly distinguished from standard remuneration. A business should reward those who willingly forego their benefits, perks in times of organizational financial crisis but it will be unethical for the business not to protect them and dishonour their commitment when it is back on rail. Retrenchment
Page 6
The ‘ at will ‘ or for a ‘cause’ clause in the employment contract may be devastating effect on employee morale but it is considered ethical when the dismissal is aimed at maximizing long term owner value. Firing to be ethical should be honest, fair, legal and without coercion or physical violence. It is a very critical decision affecting the reputation of the organization. Trust is at stake if an unethical approach is adopted, which is essential for business to survive and make profits. Poor performance, acts of sabotage, dishonesty or misuse of authority is ethical ground for firing. Issues are varied and plenty. We HR professional need to keep abreast with the ethical and unethical principles well demarcated for transparency, consistency and cordiality in the organization.
Page 7
STEEL- MADE IN CHINA?? With every passing day I think when the recession will take back its curse. When will the potential candidates get employed without having to behave like beggars on street % those who spent huge amount of money to enhance their skills and knowledge so as to beat the other competitors fighting for the same positions? A small example of how the clubs of the business schools have been affected by Sub Prime (a sneak into the club discussions in our business school): Be it the Strategy club where we discuss which are the companies who were recession proof and what strategy they had applied to do the same or the Finance Club where we discuss the Sub%prime crisis, Lehman Bros. case, Great depression, Balance Sheet Reviews of companies etc. etc. Be it directly related to the topic or not finally we derive the Sub%prime effect on the topics. Leaving apart these trivial issues let’s focus on the impact of the same on Global Economy. Just a small peak in one of the most hit sectors of the world: Infrastructure Development has been falling in countries like US and UK since the economic bubble burst in the last year. This in return is affecting the steel industry in an adverse way. The steel manufacturers are thus forced to contract their supply in the current fiscal year. We can see reduced growth prospects for the steel manufacturers all over the world. This in turn is leading to fall in steel
Page 8
price. Steel manufacturers are recording losses in their first quarter results. Let’s see which nation looks most prone to face the hit. In order to have a clear picture of the same let us see the steel production scenario globally in the last fiscal. The following figures are derived from Iron And Steel Statistics Bureau's monthly reports as published in the month August 2009. The five main steel producing countries of the Far East showed varying production with both China and India showing an increase. 1. China's June steel production showed an increase of 6% to 49.4 million tonnes which contribute to 49.5% of the world's total steel production. 2. Crude steel production in Japan declined by a third in June with the year to date total down 40.7% to 36.7 million tonnes. 3. India has now become the third largest steel producing country in the world with June production up 5.7%, bringing the year to date total to 27.6 million tonnes, an increase of 1.3%. 4. South Korean steel production was down 14.4% in June, and by 17.3% in the year to date to 22.8 million tonnes. 5. Taiwanese production decreased by 29.5% in June and by 39% in the six months to 6.6 million tonnes. Australian crude steel production dropped by 52% in the first six months to 1.9 million tonnes. An overview on the past steel production dips: The biggest fall in demand over one year for the steel industry since the end of the Second World War was the 8.7 per cent drop in 1982, towards the end of a downturn in global industry. That was the third consecutive year in which steel industry output fell. There have been only three occasions since 1900 when output has declined for three years in a row. Similar slump periods for the industry were 1930% 32, 1944%46 and 1990%92. Production of crude steel for the countries reporting to the World Steel Association in June 2009 was estimated to be 99.8 million tonnes, a decrease of 16% over June 2008. China accounted for almost half of the global production of steel in 2009, the year to date total fell by 35%. All regions showed a drop in both June and the year to date totals except for that of Middle East. On the other hand if we compare the steel production contraction we will see a decline in the contraction rate. China followed by India is seen to be the most sensitive in this sector at this point of time. This can be very well validated by the first news I came through in the newspaper on the morning of 28th August: DEMAND SLUMP HITS TATA STEEL Q1 NET The company recorded a consolidated loss of Rs. 2209 Crores in the first quarter of the fiscal. If you carefully see the balance sheet of the Company for the quarter ended June 2009 we will see Raw Material cost contributing 38% of the total expense of Tata Steel Ltd. alone and when we look at the consolidated Balance Sheet it is around 29% of the total expense. The consolidated figure gives us the
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raw material contribution to the business of both Tata Steel Ltd. and Corus. So if we try to arrive at the percentage that Raw material contributes to only Corus it will be around 20%. This means that the rotation of stock is very low due to fall in demand for the finished product in Tata Steel. Even though you say it might be the distance coverage expense that is high in case of Tata Steel while procuring raw materials I would say it can’t throw up such a high difference. Mr. Laxmi Narayan Mittal is still optimistic about the growth in steel sector in the current fiscal.
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THE AGING MACHIAVEL The art of government is the organization of idolatry. Liberty means responsibility. That is why most men dread it. Vice is waste of life. Poverty, slaughter and celibacy are some canonical vices. Economy is the art of making most of life. The love of economy is the root of all virtue. Political Economy and Social Economy are amusing intellectual charades but Vital Economy is the Philosopher’s Stone. Does every manager realize the miracles of Vital Economy brought about by simplest tools of personnel management? If he doesn’t, the moment the manager deliberately injures, the injured leapfrogs with the politics initiated and empowers himself to dissect the canonical vice of Machiavellianism in Management. Not only was the Machiavellian schemer an anti%hero on the erstwhile Elizabethan stage but is also looked down upon as a bogeyman in today’s corporate scenario. A number of formulae have been invoked to account for the declining influence of Machiavellianism in the 19th and 20th centuries. The simplest and most capacious is simply that the world has been Machiavellianised. When moral principles ceased to be independent, unchanging public rules controlling the behaviour of those who professed them%%%when principles were replaced by ideas of interest, progress or class solidarity%%%then Machiavellianism lost most of the brownie points it had earned in the times of Shakespeare penning Macbeth. The modern political liar isn’t Machiavellian; he doesn’t even want to deceive; he is simply telling his constituency what it wants to hear. That’s his business. Machiavellianism is only possible only in an age of public morality or at least of moral expectations and that is not our own. Again, why did Machiavelli recommend that a prince (read the CEO in the present context) must be ready to be cruel and devious? He himself gives the answer: in the long run, this is often kinder than to expose citizens (staffers in an organization) to the turmoil let loose by a weak ruler. Read it in Machiavelli's own words: "A man who wishes to make a profession of goodness in everything must necessarily come to grief among so many who are not good. Therefore it is necessary for a ruler, who wishes to maintain himself, to learn how not to be good, and to use this knowledge and not use it, according to the necessity of the case". The operative phrase here is, "according to the necessity of the case", which in other words means, "it all depends". Your management style cannot be straitjacketed and
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has to change as the situation demands. Even the worst of Machiavelli's critics should find nothing wrong with these arguments. After all, expediency is the name of the game in effective management. Hence we still maintain that the end justifies the means but in most certainty, this conniving and injuring concept of management is on its way to speedy erosion. The present day online job consultancy unit, namely, ‘www.monster.com’ clearly fuels the mind to actually identify the latent Machiavellian streak in corporate employers’ couches that the employee wants to do away with, slash it to oblivion if possible. Machiavellianism is the mirror of the world today; bizarre and grotesque where ethical principles are pitiably, dependent variables. We do not need an alibi to be shrewd and scheming anymore. It IS expected out of us as it is an extension of one’s corporate personality. Machiavellianism is no longer a tact device. The pocket handbook of a scheming Manger just got reduced into parchments of antiquity.
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Experimentation of Qualities… The success of a manager depends on certain qualities. All of us try to achieve those objectives we set in our mind. In order to achieve those objectives we often neglect certain other attributes which help us to build our character, our morale, our social image. We put emphasis on our short term goal completely forgetting the long term goal. Sometimes we feel we can never be in the line of honesty being a part of this rustic, filthy corporate society. We can never be honest; we have to manipulate norms and rules in order to proceed further in our career. However my experience with corporate honchos doesn’t support that view at all. Instead most of the companies emphasize building relationship with employees to retain them in the organization for long. Here the qualities play a very important role to decide upon our career. These few qualities are% Honesty Openness to learning Flexibility Communication skill All of us possess these qualities to some extent but what we don’t realize is that we do not follow those qualities and it fades out. We do not understand the magnitude of these qualities and focus on short term gain. Instead we should extensively depend on these qualities and build our future. My small experience with India Inc voices the same. Talking to an HR head of a company it is understood that India Inc banks on honesty and transparency. Honesty and integrity are the two key factors to be successful. We all try to get money and prosperity in our life but by dishonest means. But in the long run we find ourselves in the failure side. The very examples of Satyam scam is a perfect example of it. Being a part of the corporate we should be open to accept the changes. We need to fit ourselves in the role designed to us. We should understand the demand and incorporate changes on that basis. The recession post India is more open to accept changes and so as we.
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To fit ourselves in the ever changing world we need to be flexible. Now a day the India Inc is more interested in people having multi skill than specialist. We need to acquire a set of skill to fulfill a variety of business needs. The role of an HR manager is not restricted to preparing excel sheet for monthly pal role for their employees. Instead they cover an extensive ground ranging from performance appraisal to employee relation to legal initiatives. What I fond out is that the proper communication skill differentiates the best from others. When we talk about communication we think excellent fluency, flowery language. But the thing we ignore is the timing of the delivery. We must keep it in our mind that to be a strong speaker one has to be very specific about his speeches. There is always a right time to speak on a subject which could be a mess if delivered inappropriately or at the wrong time. The learning is an ongoing process. It can never be stopped. We enrich our knowledge by experiences with the help of certain qualities which we need to sharpen continuously. The best way to get success is to face as many challenges as possible.
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Winner Q-Quotient August 2009!
Debjit Basu, MHRM 2009-11
Answers to August Q-Quotient 1. Ethos Water 2. Aids Prevention and Treatment 3. Mercy Ships 4. Merry%Go%Round 5. Micro%credit Lending 6. Livestock, Agricultural Training and Seedlings 7. Larsen & Toubro (L&T) Ltd. 8. ITC Limited 9. ICICI Bank 10. Namma Shaale
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Septembert 2009 Q-QUOTIENT
If you think you have the grey matter that matters, then mail us the answers to the following questions at [email protected]. The entry with the maximum number of correct entries will witness his/her name and picture in this space in the next edition of E %mag!ne. So its time to let the world know your Q %quotient This month’s Q- Quotient is a special one dedicated to the city of dreams. That’s right.. Mumbai. Emag!ne would like to thank Mr. Debjit Basu for being the quizmaster for this very special edition of Q- Quotient.
MUMBAI-THE INSOMNIAC CITY 1.
The name Bombay was derived from a Portuguese word “BOM BAHIA”(The good bay).The name was given by a portuguese sailor in 1508.Who was he?
2.
Who was appointed as the First Governor General of Bombay by the East India company?
3.
The Quit India movement was launched by Gandhiji in Bombay in 1942 from Gowalia Tank.By what name is it known today?
4.
India’s first cricket club was founded in Bombay in 1848.What was it called?
5.
When a person travel towards Mumbai, one can see the milestone stating 35 kms., but where is Mumbai 0 km?
6.
Mumbai is made up of an archipelago of seven islands.which island is also known as “little Colaba”?
7.
Bombay was the headquarter of the East India Company in Western India from 1668%1858.When did it pass to Great Britain?
8.
The Gateway of India near the waterfront commemorates one”s visit in 1911?Who was it?
9.
When did Bombay become Mumbai?
10. The most popular food of Mumbai which derives its name from a Portuguese word meaning “bread”?
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This month’s Ace the Case section has two of our friends Ms, Kirti Agarwal, & Ms. Malini Sengupta preparing the case study for us. Keeping tabs to all your requests and interest in this section, we are delighted to inform that we would start publishing the answers to the questions of each of the cases posted here.. So friends… wait till the next month for this month’s solution of the Case.
PREMIER CHEMICALS Premier Chemicals is a Rs. 2000%crore company headquartered at Ahmadabad. The company is into manufacturing of bulk drugs as well as formulations, and markets its products across the country as well as countries in Europe and South Asia. The company is traditionally run and is fully controlled by promoters. However, with the advent of a competitive environment, the company felt the need for revamping its operations and restructuring the organisation structure too. The CEO in his meeting with the VP (Operations), VP (HR) and other departmental heads discussed and approved the revised organizational structure. The VP (HR) was given a period of 3 months for completing the revamping/recruitment process. The VP (HR) engaged an HR consultant and assigned them the following tasks: •
Mapping the existing business profile and strategy of the organization
• •
Mapping the competencies of the existing manpower Reviewing the requirements of the existing manpower vis%à%vis the new organisational structure.
• •
Identifying the competency and manpower gaps Retraining and redeploying of manpower
• •
Recruitment and additional manpower Preparing of position wise succession plan and a matching career plan for the employees
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The company recorded an average performance of only 17% increase in net sales and profit as against the envisaged target of 40%. The CEO in his annual review meeting with the departmental heads reviewed the situation, and during the course of brainstorming they identified the following: •
Some of the employees who did not possess the required level of competencies were recommended for promotion by the HR consultant and were promoted by the HR department with a view to comply with the recruitment and staffing target period.
•
A few of the new recruits were found to be leaking confidential to the competitors. A subsequent investigation revealed that some of them were actually implanted by the competitors.
QUESTIONS 1.
What was wrong with the revamping strategy of the company?
2. 3. 4.
What went wrong with the recruitment process? Did the company take the right step by engaging HR consultant? Who should be held accountable for the organizational debacle?
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“The world is a book, and those who do not travel read only one page” St. Augustine Indeed the truth cannot be more precisely stated. September has been a month full of travel and journey for a majority of the students of the Department of MHRM, IISWBM. The travel being talked about is the placement trips to the 3 different zones – West, North and South. The days before the travel began were the most hectic ones for the students of the department. The students were involved in a plethora of activities for the placement trips. Making calls to the companies for fixing appointments, collecting all data necessary for conducting the trips, compiling them all together, taking active part in creating the placement brochure, packing it and preparing it to be sent along on the trips and also planning the actual journey and arranging for the tickets, the students handled it all. Students slogged round the clock to make this trips happen and they learned a fair lot of things doing so. This phase of planning for the trips and the actual trip that follows teaches the students a lot about management, much more than perhaps any book can teach them. They are at their own handling events and making things happen. They have no guideline to tread carelessly along, they are always on their toes thinking, making plans, breaking plans and then re%planning. Whatever happens on the trips all the team members share the responsibility together. They work together as a team to cover impossible looking schedules, achieve deadlines and handle mounds upon mounds of big%small activities. End August the trips began with the South team setting sail, soon to be followed by the North and West teams in Early September. The trips saw the students working day in and day out to visit companies in their respective zones and trying to make the presence of the college felt. Each zone trip was different in the sense that the students had to adjust to completely different sets of cultures and norms. For the people on the trips each day was full of discoveries and new experiences. Traveling to unknown destination everyday, meeting corporate big%wigs, eating local food, taking in the local sights while traveling along… the sensory overload was delightful to say the least. Being on these trips gave the students a taste of the diversity that is India. Each zone was mighty different from Kolkata, wherefrom the trips began.
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