Treat Your Workers With Dignity – The RATAN TATA Way

One of the first lessons I learnt from Dr JM Juran, in 1987, was “Treat your workers with dignity.” This management practice facilitates quality business results.

In all the recent Singur turmoil, what struck me most was Mr Ratan Tata’s consistent and persistent concern for the safety of his Tata Motor workforce. Ultimately, when matters heated up, he walked his talk by exiting Singur. He paid a staggering price, but earned the trust of the Tata Motor workers and their families; as well as set a benchmark for industry leaders.

By contrast, in the current economic turmoil, leaders in the aviation sector, Mr Naresh Goyal and Dr Vijay Mallya, of Jet Airways and Kingfisher Airlines respectively, reduced their workforce to reduce costs. I wish to share one more lesson learnt by me from Dr Juran: “Over 80 percent of problems in an organization are management controllable, not worker controllable.”

The indignity of being laid off means losing face with one’s peers, family, and neighbours. This is totally unacceptable to any worker, regardless of level of education.

A better practice for intelligent cost reduction is to identify the chronic waste locked in the managerial processes of an organization, and then to systematically reduce the same. The chronic waste can translate to 40% of total costs at Jet Airways and Kingfisher Airlines. The two aviation leaders should set strategic goals to halve the chronic waste in their respective organizations; deploy senior improvement teams to solve the chronic problems; and thereafter comfortably pay salaries of the workforce. As a carrot to these two customer focused leaders, customers will also enjoy increased efficiency when chronic waste is reduced in managerial processes.

This is a win win solution for all.

Employee delight must precede customer delight.

Explore posts in the same categories: 01 Leadership, 06 Human Resource Focus, Benchmarking, Business, Management

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7 Comments on “Treat Your Workers With Dignity – The RATAN TATA Way”

  1. Shalin Mehta Says:

    I totally agee with Mr. Suresh Lulla. Being a second generation Tata employee myself, (Tata Chemicals), I hadn’t looked at it from this angle, because Tata Group’s concern for employees is a given thing for us.
    However, some quarters had also critisized Tata for not ensuring ‘Just’ compansation to workers. People express openions under mistaken belief that WB state govt used its legal powers to acquire land from farmers at a low price because they might have had an agreement with Tata Motors to sell acquired land at that price. In reality land was leased and lease amount does not have and link with price at which Govt acquired it. Actually the benifiting industry, though very much an interested party, does not have a locus standi in land acquisiion process.

  2. M Rama Krishna Says:

    The concept part of this post is excellent, but not the examples chosen to drive the concept.

    Resettlement and Rehabilitation is a big subject, Ms Medha Patkar spent whole her life in fighting for this cause.

    Workforce safety is a concern even for the JET/Kingfisher, no doubt about it. Coming to the lay-offs, ‘hire & fire’ is the culture of westeren society, ‘lifetime employment’ is the culture of eastern society. COPQ is more of hard tools, not soft (sensitive) issues, I believe.

  3. Suresh Lulla Says:

    Thank you for your comments.

    Yes, COPQ is a hard tool. Yes, job security is a soft issue.

    Hasty remedies, such as cost reduction through workforce reduction, can result in soft sensitive (but major) long-term problems.

    The purpose of the blog was to communicate that one must always have sensitive issues such as worker dignity in perspective when solving problems – major or minor. If the problem is runaway costs as in the aviation sector, then I recommend Intelligent Cost Reduction by reducing chronic waste. That will not hurt worker dignity.

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