HUMAN RESOURCE MANAGEMENT CASE STUDIES

HUMAN RESOURCE MANAGEMENTASSIGNMENT-2

Submitted by

Ashish Kumar Annepu

Roll no-7

DFT-7

CASE STUDY 1: POOR SANJAY!

CASE-NOTES

Sanjay Nagpal is a new recruit from a reputed management institute,

recruited as a sales trainee in a sales office of a large computer hardware firm

located in Chennai.

Raghvan is the zone sales manager responsible for overseeing the work of

sales officer, field executives and trainee salesmen numbering over 50 of

three areas namely Chennai, Bangalore, and Trivandrum.

The sales growth of the products in his area was highly satisfactory owing to

the developmental initiatives taken by respective State Governments in

spreading computer education.

Raghvan had collected several sales reports, catalogues and pamphlets

detailing the types of office equipment sold by the company for Sanjay’s

reference.

After short chat with Sanjay, Raghvan assisted him to his assigned desk and

provided him with the material collected.

Thereafter Raghvan excused himself and did not return.

Meanwhile, Sanjay scanned through the material given to him till 5:00pm

before leaving office.

Human Resource Management Page 2

QUESTIONS:

Q1. What do you think about Raghavan’s training

programme?

Q2. What type of sale training programme would you

suggest?

Q3. What method of training would have been best

under the circumstances? Would you consider OJT,

simulation or experiential methods?


Q1. What do you think about Raghavan’s training

programme?

Answer:

The training method adopted by Raghvan is not apt for a new trainee

employee like Sanjay.

Even though from a reputed management institute, Sanjay’s skill and

knowledge are limited to his learning in the institute.

The material collected in relation to the products of the company only

provides an insight as to what the company sells and not what Sanjay is

desired to perform as a part of his job.

This thus justifies that the training programme followed by Raghvan doesn’t

suffice for imbibing the required job instructions required for performing the

job.

This type of training may in general be of no benefit to both Sanjay’s

performance and Company’s productivity and also waste of precious

resource and time.


Q2. What type of sale training programme would you

suggest?

Answer:

The factors that need to be kept in mind while suggesting an apt sales training

programme would be:

Sanjay being a newly recruited trainee.

The nature of the job (sales).

The level of performance desired.

Awareness about how to do the job.

Identifying the Trainee: - In this case Sanjay being a new recruit, he must

be given an entry-level training.

Identifying the Trainers: - It would be essentially suitable that training must

be imparted by immediate experienced supervisor of the trainee.

Method and Technique of Training: - Training may be imparted by means of

on –the job methods as Sanjay is from a management college of good repute

where he has already learnt a lot via off- the-job techniques.

Level of learning: - As it is an entry level training more emphasis must be

given to development of basic understanding of the field, becoming

acquainted with the language, concepts and relationships involved in the job.

Conduct of training: - Suitably the training programme should be on the job

itself so as to provide sufficient exposure and real time supervision to the

trainee.


Q3. What method of training would have been best

under the circumstances? Would you consider OJT,

simulation or experiential methods?

Answer:

The method suitable for training would be On-the-Job Training (OJT).

In this method the trainee would receive firsthand experience of the job

conditions.

This method is economical since no additional personnel or facilities are

required.

The trainee learns on the actual equipment in use and in the true environment

of his job.

The trainee also learns by day-day observation the applications of the rules,

regulation and procedures.

It is also appropriate for teaching the skills and knowledge which can be

acquired in short term.

Since the nature of the job is of sales, hence hands on experience is a must

for gaining experience of the job.

The training must be done in stages in situations varying from easy to the

toughest conditions.

This way the trainee will build up his experiences and learn the decision

making process and strategies.


CASE STUDY 2: IS RAJAT IN NEEDS OF REMEDIAL TRAINING?

CASE NOTES:

Rajat Sharma has been employed for six months in the accounts section of

a large manufacturing company in Faridabad.

A formal investigation to monitor and determine the contributions of each

employee in the accounts section and check whether they meet standards.

After the investigation it was found that all employees in the accounts section

were meeting the targets that were set.

Rajat, an employee in the account section was an exception to the

performance displayed by his colleagues.

Along with numerous errors, Rajat’s work is characterized by low

performance; often he does 20 percent less than the other clerks in the

department.


Questions:

Q1. As Rajat’s supervisor can you find out whether the

poor performance is due to poor training or to some

other cause?

Q2. If you find Rajat has been inadequately trained,

how do you go about introducing a remedial training

programme?

Q3. If he has been with the company six months, what

kind of remedial programme would be best?

Q4. Should you supervise him more closely? Can you

do this without making it obvious to him and his co-

workers?

Q5. Should you discuss the situation with Rajat?


Q1. As Rajat’s supervisor can you find out whether the poor

performance is due to poor training or to some other cause?

Answer:

Yes, the cause of the poor performance can be well determined as to

whether, it is because of poor training or other causes such as uncongenial

work place, low wages or low motivation.

To check whether the poor performance is attributed to poor training, the

reports of his performance/learning during the training must be checked.

It is to be inspected and identify the areas where he had not performed well

or did not show good progress in learning,

Then these identified areas must be closely supervised when the job is

performed by Rajat.

Mistakes encountered must be closely examined and brought to his notice

along with the corrections that are required.

He must also be humbly prompted to review his own work to find out the

mistakes in order to make him realise his mistakes and provide an

opportunity for self–correction.

He must be properly supervised for 2-3 months so to bring about a change

in performance.

Parallel investigations must also be done to check factors other than training

affecting /demotivating him.

Incentives for improvements in performance can also be introduced to

induce genuine interest in the work.


Q2. If you find Rajat has been inadequately trained, how do you go about

introducing a remedial training programme?

Answer:

Firstly, it is to be checked as to what type of training Rajat had been through

in the organisation.

Then the records of the performance/learning in the training are to be

investigated in order to find the “weak” areas.

Secondly, an analysis is also to be done on his colleagues who had received

same training as him and determine as to how they are coping and performing

with the training provided.

Investigation into the training records can also help in determining the gap’s in

the training that may have lead to the present problems

An appropriate plan of action or training has to be in place in order to fill the

gaps identified.

The remedial training should basically focus on the gaps observed in his

earlier training and also keeping the focus on the skills and abilities that hold

prime-importance in meeting the set-standards.

Remedial training should be oriented in a manner such that Rajat would

receive Incentives /awards for his improvement in his work, thus acting as a

motivating factor for active participation.

The required training must not be long and should be precisely cut to needs .


Q3. If he has been with the company six months, what kind of

remedial programme would be best?

Answer:

As Rajat has been working in the company for the last six months he must

have gained some necessary experience and skills to perform his job.

He must have been provided with a initial training during the period of his

induction into the company.

The training would have helped him understand and better comprehend his

job and make him understand as to be expected of him.

If in case due to some reason or the other if the training wasn’t successful or

any gaps in learning may have been left in his training, it must be

concentrated upon to fill those required gaps by a remedial training.

An assessment of his training report can well highlight the gaps.

The training programme should be designed in a manner such that it serves

the purpose of covering the gaps.

The training necessarily may not be of long period and can also be of on-site

in nature i.e. on the job.

This shall help him gain practical experience as he goes through the training

process which shall help him retain and learn faster.

A close supervision even after the training is recommended so as to check

whether the performance is sustained and continuous.


Q4. Should you supervise him more closely? Can you do this

without making it obvious to him and his co-workers?

Answer

Rajat must be closely supervised as it is necessary from his as well as the

organisation’s point of view to achieve appropriate standards of performance.

Supervision is strictly necessary to check the numerous mistakes and

lessened productivity portrayed by Rajat.

To some extent supervision is good as it is a matter of improving the person,

holding back from doing so would only harm him.

The supervision can be done by providing personal attention and interaction

such as, a one to one discussion of the problems faced and suggesting

appropriate solutions for them.

The supervision must be done on the lowest possible tone/intensity by

indirectly reviewing the daily work with least interventions possible and

provide feedbacks or recommend corrections by communicating informally/

personally rather than formal communication.


Q5. Should you discuss the situation with Rajat?

Answer

The magnitude of the problem is compelling and demands Rajat’s immediate

attention.

Rajat needs to be aware of the situation and the harm being caused, such

that he doesn’t perceive close supervision of his work as criticism or

reprisal.

Discussing the situation will make him aware of his current position, what’s

wrong with it and what remedial action is planned.

Rajat’s interest and willingness are prerequisites for active participation in any

remedial measures and also to the success or positive outcome of the steps

taken.

The above pre-requisites can only be stimulated by having a detailed

discussion on the concerning issue rather than keeping him unaware of the

situation and create a discomforting work environment.


CASE STUDY 3: INDIAN AIRLINES HR PROBLEMS

CASE NOTES

FLYING LOW

Indian Airlines (IA) India’s national carrier is a perfect example of a

monopoly gone berserk with the absolute power it had over the market.

Continual losses over the years, frequent human resource problems and

gross mismanagement were just some of the few problems plagued the

company.

Frequent strikes by IA pilots reflected the adamant attitude of the pilots

resulting in increased public resentment towards the airline.

Recurring human resource problems were attributed to its lack of proper

manpower planning and underutilization of existing manpower.

The recruitment and creation of posts in IA was done without proper scientific

analysis of the manpower requirements of the organization.

Employee unions were rather infamous for resorting to industrial action on

the slightest pretext.

The Government took various steps to turn around IA and initiated talks for

its disinvestment.

Amidst strong opposition by the employees, the disinvestment plans

dragged on endlessly well into mid 2001.

This shows how poor management, especially in the human resources area,

could spell doom even for a Rs 40 billion monopoly.


BACKGROUND NOTE

IA was formed in May 1953 with the nationalization of the airlines industry

through the Air Corporations Act.

IA and its subsidiary, Alliance Air, provided domestic air services.

IA’s network ranged from Kuwait in the west to Singapore in the east,

covering 75 destinations (59 within India, 16 abroad).

In 1999, the company

In 1999, it had a fleet strength of 55 aircraft - 11 Airbus A300s, 30 Airbus

A320s, 11 Boeing B737s and 3 Dornier’s D0228.

In 1994, the Air Corporation Act was repealed and air transport was

thrown open to private players.

Corporate houses entered the fray and IA saw a mass exodus of its pilots

to private airlines.

To counter increasing competition IA launched a new image building

advertisement campaign.

Improved its services by strictly adhering to flight schedules and providing

better in-flight and ground services.

Launched several other new aircraft, with a new, younger, and more

dynamic in flight crew.

These initiatives were soon rewarded in form of 17% increase in passenger

revenues during the year 1994.

Competitors like Sahara and Jet Airways (Jet) provided better services and

network.

Unable to match the performance of these airlines IA faced severe criticism

for its inefficiency and excessive expenditure human resources.

Staff cost increased alarmingly during 1994-98.

These costs were responsible to a great extent for the company’s frequent

losses.


By 1999 the losses touched Rs 7.5 bn.

In the next few years, IA’s market share, however continued to drop.

In 1999, while IA’s market share was 47%, the share of private airlines

reached 53%.

Unnecessary interference by the Ministry of Civil Aviation was a major

cause of concern for IA.

Interference ranged from deciding on the crew’s quality to major technical

decisions in which the ministry did not even have the necessary expertise.

IA had to operate flights in the North-East at highly subsidized fares to fulfil

its social objectives of connecting these regions with the rest of the country.

These flights contributed to the IA’s losses over the years.

The carrier’s balance sheet heavily skewed towards debt with an equity base

of Rs 1.05 bn in 1999 as against long term loans of Rs 28 bn, heavy interest

outflows of Rs 1.99 bn further increased the losses.

IA was found grossly deficient in realistic assessment of the manpower

needs, need-based recruitment, optimum personnel utilization and abolition of

surplus and redundant posts.

‘FIGHTER’ PILOTS?

IA’s eight unions were notorious for their defiant attitude and their use of

unscrupulous methods to force the management to agree to all their

demands.

Strikes, go-slow agitations and wage negotiations were common.

Each had a different reason, but every strike was about pressurizing IA for

more money.

From November 1989 to June 1992, there were 13 agitations by different

unions.

The strategies adopted by IA to overcome these problems were severely

criticized by analysts over the years.

Analysts noted that the people heading the airline were more interested in

making peace with the unions than looking at the company’s long-term

benefits.


Russy Mody (Mody), who joined IA as chairman in November 1994, made

efforts to appease the unions by proposing to bring their salaries on par with

those of Air India employees.

This was strongly opposed by the board of directors, in view of the mounting

losses.

Mody also proposed to increase the age of retirement from 58 to 60 to

control the exodus of pilots.

Government however rejected his plans.

When Probir Sen (Sen) took over as chairman and managing director, he

bought the pilot emoluments on par with emoluments other airlines,

thereby successfully controlling the exodus.

Sen created Alliance Air, a subsidiary airline company where the

re-employed people were utilized.

He was also instrumental in effecting substantial wage hikes for the

employees.

The extra financial burden on the airline caused by these measures was

met by resorting to a 10% annual hike in fares.

Sen.’s efforts seemed to have positive effects with an improvement in aircraft

utilization figures.

IA also managed to cut losses and reported a Rs 140 million profit in 1997-

98.

But recessionary trends in the economy and its mounting wage bill pushed IA

back into losses by 1999.

Sen and the entire board of directors were sacked by the government.

In 1990s, in yet another effort to appease its employees, IA introduced the

productivity-linked scheme.

Eventually, the PLI schemes raised an additional annual wage bill of Rs 1.8

bn for IA.


It was alleged that IA employees did not work during normal office hours; this

way they could not work overtime and earn more money.

Though experts agreed that IA had to cut its operation costs. To survive the

airline continued to add to its costs, by paying more money to its

employees.

In 1998, IA tried to persuade employees to cut down on PLI and overtime to

help the airline weather a difficult period; however efforts failed.

Over the years, the number of employees at IA increased steadily.

IA had the maximum number of employees per aircraft.

It was reported that the airline’s monthly wage bill was as high as of Rs 680

million, which doubled in the next three years

The Brar committee attributed this abnormal increase in staff costs to

inefficient manpower planning, unproductive deployment of manpower

and unwarranted increase in salaries and wages of the employees.

Analysts criticized the way posts were created in IA.

In 1999, Six new posts of directors were created of which three were created

by dividing functions of existing directors.

Thus, in place of 6 directors in departments’ prior April 1998, there were 9

directors by 1999 overseeing the same functions.

Analysts pointed that in the case of cabin crew, 40 posts were introduced in

the Southern Region on an ad-hoc basis, pending the assessment of their

requirement by the Staff Assessment Committee.

Another problem was that no basic educational qualifications prescribed

for senior executive posts.

Even a matriculate could become a manager, by acquiring the necessary job-

related qualifications & experience.

Illiterate IA employees drew salaries that were on par with senior civil

servants.

After retirement, several employees were re-employed by the airline in an

advisory capacity.


With each strike/go-slow and subsequent wage negotiations, IA’s financial

woes kept increasing.

Though at times the airline did put its foot down, by and large, it always

acceded to the demands for wage hikes and other perquisites.

TROUBLED SKIES

Frequent agitations were not the only problem that IA faced in the area of

human resources.

There were issues that had been either neglected or mismanaged.

Various allowances such as out-of-pocket expenses, experience

allowance, simulator allowances etc. were paid to those who were not

strictly eligible.

Excessive expenditure was incurred on benefits given to senior executives

such as retention of company car, and room air-conditioners even after

retirement. All these problems had a negative impact on divestment

procedure.

Privatization was expected to give the IA management an opportunity to make

the venture a commercially viable one.

Freed from its political and social obligations, the carrier was expected to be

in a much better position to handle its labour problems.

The biggest beneficiaries would be perhaps the passengers, who would get

better services from the airline.


QUESTIONS

Q1. Analyze the developments in the Indian civil

aviation industry after the sector was opened up for

the private players. Evaluate IA’s performance. Why

do you think IA failed to retain its market share

against competitors like Jet Airways?

Q2. IA’s human resource problems can largely be

attributed to its poor human resource management

policies. Do you agree? Give reasons to support your

stand?


Q1. Analyze the developments in the Indian civil aviation industry

after the sector was opened up for the private players. Evaluate

IA’s performance. Why do you think IA failed to retain its market

share against competitors like Jet Airways?

Answer

The Air Corporation Act was repealed in the year 1994, thus throwing the

aviation market open to private players.

Corporate houses entered the fray to milk the large opportunity available.

As a result, Indian Airlines witnessed mass exodus of its pilots to private

airlines.

Indian Airlines had to face the heat of the open market competitors and

consumer expectations.

To gain competitive edge Indian Airlines launched a new image building

advertisement campaign.

Emphasis was put upon the improvement in services both in-flight and on-

ground and flights strictly adhering to schedules.

New flights with younger and dynamic crew were also launched to attract

consumers.

As a result of the above effort Indian Airlines could garner 17% increase in

passenger revenues during the same year.

Meanwhile the other competitive player provided better services and networks

on offer for consumers.


Indian Airlines Performance.

The airlines response to the emerging competitiveness in the open market in

1999 was eminent with the decision to undertake various initiatives to rebuild

its image.

It was successful in its initiative and was even rewarded with increase in

revenues.

This however couldn’t be sustained by the airline and its revenues started

sliding downwards.

Unable to match the services and sustain improvements the airline was

criticised for its inefficiencies and excessive expenditure on human resource.

The organisation started to face frequent losses which amounted to Rs 7.5

billion in 1999.

Failures in Competition

The airline failed in its image rebuilding initiatives where in the contributing

cost of the human resource spiralled out of tolerance levels.

The inefficiencies and expenditures were attributed to the organisations

growing losses.

Staff cost increased alarmingly to Rs 5.9 bn during 1994-98 period.

Although many private companies were vanquished, those which went on to

eat up IA’s market share.

This was evident by the fact that in 1999 IA’s share was 47% where as that of

private airlines was of 53 %.

These failures could also be attributed to the unnecessary interference by the

civil aviation ministry which neither had the necessary competence or

expertise to take intricate decisions.

The decision making interference ranged from deciding on the crew’s quality

to major technical decisions.

More than required beaurcratic involvement in the organisational affairs was

responsible for the failures.


The fulfilment of social objective by the organisation of connecting the north-

eastern regions with the rest of the country also contributed to the already

heaping losses.

Heavy interest outflows and large debts can be attributed as a major

contributor to the huge losses.

Unorganised and unplanned human resource were also responsible for the

ever increasing costs and inefficiencies.

Basic human resource management concepts were not followed that led to

unplanned manpower.

Inefficient Manpower planning can mainly be attributed as the prime reason

for the presence of surplus and redundant posts.

Inefficient in manpower planning, rocketing cost of human resource, social

obligations, too much beaurocrat and political interference, huge interest flows

and incapability of maintaining the improvements in combination fuelled the

failure of the airline in the open competitive market.


Q2. IA’s human resource problems can largely be attributed to its

poor human resource management policies. Do you agree? Give

reasons to support your stand?

Answer

It is true that IA’s human resources problems were due to its poor human

resource management policy.

Recurring human resource problems were attributed to its lack of proper

manpower planning and underutilization of existing manpower.

Employee unions were infamous for resorting to unscrupulous methods on the

slightest pretext and arm-twisting tactics to get their demands accepted.

In turn, the management of the airline was more interested in making peace

with the unions rather than looking at the company’s long-term benefits.

Mounting wage bills as a result of the many employee wage friendly schemes

depicted the simplistic approach of the management.

Improper monitoring by management and abuse by employees of the

Productivity linked incentive scheme reflects the inefficient functioning.

Uncontrolled increase in the number of employees and the number of surplus

and redundant posts with maximum number of employees per aircraft.

This abnormal increase in staff was attributed to inefficient manpower

planning, unproductive deployment of manpower and unwarranted increase in

salaries and wages of the employees.

The recruitment and creation of posts were done without proper scientific

analysis of the manpower requirements of the organization.

In place of 6 directors in departments there were 9 directors.

In total there were 30 full time directors, who in turn had their retinue of private

secretaries, drivers and orderlies. These were superfluous staff that just

added to the organisation’s bill.

There were no basic educational qualifications or job specification prescribed

for senior executive posts.


A matriculate also could be a manager, by acquiring necessary job-related

qualifications & experience.

Illiterate employees drew salaries that were on par with senior civil servants.

Retired employees were re-employed by the airline in an advisory capacity.

Frequent Dissonance between the union and the management made a hostile

environment in the organisation.

Though, the airline at times held its ground, by and large, it acceded to the

demands for wage hikes and other perquisites.

Various allowances such as out-of-pocket expenses, experience allowance,

simulator allowances etc. were paid to those who were ineligible.

Excessive expenditure was incurred on benefits given to senior executives

such as retention of company car, and room air-conditioners even after

retirement.


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HUMAN RESOURCE MANAGEMENT CASE STUDIES