Business Cases in Organisation Behaviour and HRM: Perspectives from India (Springer Business Cases) [1st ed. 2023] 9819920302, 9789819920303

Table of contents :
Preface
Acknowledgments
Contents
Editor and Contributors
About the Editor
Contributors
1 Introduction
1 The VUCA Context
2 India—An Emerging Economy
3 Case Methodology for Management Education and Development
4 This Book—Purpose and Topics of Interest
5 Who is This Book For
6 How the Book is Organized
References
2 Growth and Transformation of Gujarat Gas Limited—An OD and HRD Perspective
1 Introduction
2 Company History
2.1 Birth of GGCL (Now GGL)
2.2 Acquisition by British Gas and Merger with GSPC
2.3 GGL Today
3 OD and HRD Interventions
3.1 Phase I: Era of Experimentation and Exploration
3.2 Phase II: Growth That Propelled Acquisition by British Gas
3.3 Phase III: Merger and Consolidation with GSPC Group and Growth to Date
3.4 Challenges as a Combined Entity, GGL
4 Actions by the New Head HR
4.1 Final Interaction with the MD
5 Present Challenge Before Head HR and GGL HR Team
6 Case Questions
Annexure I: HRD Interventions
Phase 1: HRD and Management Interventions in the Early Years of GGCL
Phase II: HRD and OD Interventions (BG Group Acquired the Company)
Annexure II: Vision Statement and Core Values at GGCL
Annexure III: Health Safety and Environment
Annexure IV: People’s Inclusion Toward Community and Environment at GCL
Annexure V: Corporate Social Responsibility
Annexure VI: The Significant Facts of GSPC Gas Through an HR Prism (Summarized)
Annexure VII: Employee Rewards from the HR Perspective
Annexure VIII: Grade Rationalization
Annexure IX: Major Events During the Merger with GSPC
Appendix: Teaching Note
Case Summary
Learning Objectives
Case Positioning
Teaching Plan
Discussion Questions
References
3 PRADAN: A Journey of Continuing Relevance
1 The Formative Years
1.1 Induction of Young Professionals
1.2 The Structure
1.3 PRADAN’s Processes
1.4 Annual Retreats
1.5 Challenges Faced at This Stage
2 The Growth and Expansion Years
2.1 Re-Visiting PRADAN’s Vision
2.2 Partnerships and the Non-direct Approach
2.3 PRADAN’s Internal Structures of Governance
2.4 Challenges Faced at This Stage
3 The Maturing Years
3.1 Change in Focus—Long Term to Short Term
3.2 Change in the Nature of SHGs
3.3 Burgeoning Costs
3.4 Shift in the Nature of Funding
3.5 Challenges Faced at This Stage
4 Proposal to PRADAN’s Members of the Governing Board
Annexure 1
Annexure 2: The Structure of the Organization
Annexure 3: Change: Some Building Blocks
Driven from Within
The Sense of Agency
Collectives and Groups
Engaging with Relevant Stakeholders
Appendix: Teaching Notes
Case Summary
Learning Objectives
The Target Audience
Case Questions and Suggested Timeframe
Case-Wise Analysis/Responses by Authors Along with Relevant References
Additional Questions
Additional References
References
4 Plantation of Hope: The Turnaround of Harissons Malayalam Ltd.
1 HML: Company Background
2 The Indian Tea Industry
2.1 Industry in Stress
2.2 Unhappy Workers
3 HML: An Outlier
4 HML: A Great Place To Work
4.1 Culture
4.2 HRM Practices
4.3 Employee Relations
5 The Road Ahead
5.1 Classroom Questions
Appendix: Teaching Notes
Case Synopsis
Case Positioning and Setting
Case Questions
5 Can Collaboration Thrive in a Virtual Environment?—An Enigma!
1 Introduction and Background
2 The Indian Oil Corporation Limited 
3 The Organisational Structure
4 The Human Resources—Philosophy and Structure
5 The Lockdown
6 The Enigma
7 The Trigger
8 The Idea
9 The Plan
10 Positioning and Management Buy-in
11 The Challenges and Outcomes
12 The Dilemma
Appendix: Teaching Notes
Case Summary
Learning Objectives
Case Questions
Case-Wise Analysis Along with Relevant References
References
6 Engaging Virtual Teams in Uncertain Times: A Business Case on Cyient Ltd.
1 Case Opening
2 Cyient Ltd.
3 Frame I: A Bolt from the Blue
4 Frame II: Cruising Back to Senses
5 Frame III: Navigation to Steady State
6 Safety, Enablement, and Engagement
7 Incorporating Lessons for Future
Appendix: Teaching Note
Engaging Virtual Teams in Uncertain Times: A Business Case of Cyient Ltd.
Teaching Objectives
Learning Objectives
Positioning of the Case
Case Questions and Suggested Time Frame
Case-wise Analysis/Responses by Authors Along with Relevant References
Suggested Readings
7 Paradeep Phosphates Limited’s Story of Inclusive Growth and Harmony: A Case Study
1 Introduction
2 Background of Paradeep Phosphates Limited
3 Human Resource Team
4 Interventions and Initiatives by the HR Team
5 Compliance with Labour Laws and Beyond
6 Collective Bargaining at PPL
7 Empowering Workers
8 Grievance Redressal
9 Treatment to Trade Unions
10 Connecting People for Building Trust and Transparency
11 Awards and Recognitions
12 Social Life at PPL
13 Retirement Age Issue
14 Extending the Benevolence to the Community
15 Epilogue
Exhibits
Appendix: Teaching Notes
Case Synopsis
Case Summary
Learning Objectives
Target Audience
Case Questions and Suggested Time Frame
Suggested Guidelines for Discussion
8 Start-Up to Scale-Up: The Changing Entrepreneurs’ Competencies
1 The Dream and Early Years
2 Nithin, the Entrepreneur
3 The Turning Point
4 Trader to Entrepreneur
5 Rethinking Business and Moving Ahead
6 Building Zerodha: The Journey
7 Broking to Technology: A Shift in the Modus Operandi
8 Way Forwards
9 Questions for Case Discussion
Annexures
Annexure 1: Stock Broking Industry Overview: 2015–2020
Annexure 2: Zerodha Growth: 2015–2020
Annexure 3: Zerodha Team
Annexure 4: Key Stakeholder Competencies
Appendix: Teaching Note
Case Synopsis
Learning Objectives
Target Audience
Case Questions and Suggested Time Frame
Case-Wise Analysis/Responses by Authors Along with Relevant References:
Preparation and Other Readings
Other Relevant Readings for Faculty Members’ Reference Are as Follows
9 Luminous Power—The ROI of the General Management Program
1 Luminous Power Technologies Pvt. Ltd.: Organization Context
2 The Evolving Organization and Need for Capability Building
3 The General Management Program (GMP)
4 Eligibility and Selection Process
4.1 Evaluation Criteria
4.2 Feedback on the Program
5 Return on Investment (ROI) of Gmp Program
Appendix: Teaching Note
Case Synopsis
Learning Objectives
Position in Course
Case Questions and Suggested Time Frame
Case-wise Analysis/Responses by Authors Along with Relevant References
What Was the Context and Challenges Faced by Luminous Power Technologies? What are the Multiple Approaches for Building Capability Within Organizations?
Understanding ROI of Training
The GMP Program
How Should the General Management Program's Return on Investment (ROI) be Measured?
If Luminous were to Run the Next GMP, What Quantifiable Learning Objectives would you Recommend for ROI Calculation?
Wrap Up
Given this Context, Should the L&D Function Focus on Short-term Skill Development or Long-term Capability Building?
What Design Principles Should be Considered While Strategizing any Training Intervention for Millennials?
What Happened Next?
Required Pre-read Before the Class
Suggested Supplementary Readings
10 Siemens Gamesa Renewable Energy, India: Employee Engagement Initiatives on the Journey to the Deming Award
1 Introduction
2 Type of Case
3 The Challenge
4 Assessment Tools for Solution Analysis
4.1 Affinity Diagram
4.2 Validation of Opportunities: RE-AIM Approach
5 Skill Development
5.1 Potential Skill Development for Technician
5.2 Skills
5.3 Skill Assessment
5.4 Skill Development
6 Potential Competency Development for Executives
6.1 Competency Assessment
6.2 Competency Development
7 The Effect
8 “WILL” Enhancement
9 Employee Morale
9.1 Employee Retention and Career Development
9.2 Employee Opinion Survey (EOS)
10 Employee Welfare
10.1 Employee Welfare Committee
10.2 Long Service Award
10.3 Employee Girl Child Education Support
10.4 Scholarship to Employee Children
10.5 Employee Annual Medical Check-Up
10.6 Group Medical Insurance
10.7 Group Personal Accident Insurance and Group Life Insurance
10.8 Events and Celebrations
10.9 Employee Recognition
11 Discussions and Case Questions
Appendix: Teaching Note
Assignment Questions
Conclusion
References
11 Leave Bank—A Unique Social Security Concept
1 Rashtriya Chemicals and Fertilizers Limited
2 Mahesh in Coma
3 Departmental Brainstorming Session
4 Impact of the Policy on Mahesh and His Family
4.1 Organizational Impact
5 CUT to 2020: RCF and COVID19
5.1 The Relevance
Annexure 1
Annexure 2
Annexure 3
Appendix: Teaching Notes
Case Synopsis
Target Group
Learning Objectives
Case Questions and Suggested Time Frame
Case-Wise Analysis/ Responses by authors along with relevant references
References
12 Using Online Learning to Develop Pandemic Readiness: The Case of Deoleo in India
1 Deoleo Operations in India
2 Training of Sales Assistants
3 COVID-19 Induced Disruptions
3.1 Moving Training Online
3.2 Genesis of the Safalta App
4 Harnessing Technology in the Post Lockdown World
4.1 Back to Zoom
4.2 Scaling up the Safalta App
5 The Way Forward
Appendix: Teaching Note
Case Summary
Learning Outcomes
Case Questions
References
13 The Being and Becoming of a Leader in STEM
1 Case Problem
2 Current Context
3 The Beginning
4 Breaking Out of the Comfort Zone
5 Committing for the Long-Haul
6 Strategizing for the Future
7 Breaking Through—The Glass Ceiling
8 Life at Cross-Roads
9 Reaching Out
10 Back in Action
11 Another Dream Comes True
Annexure I: Exhibit
Appendix: Teaching Note
Case Synopsis
Learning Objectives
Case Questions and Suggested Time-Frame
Option 1 to Be Taught as a Case on Leadership (1 X 90 min)
Research Methods
Case-Wise Analysis/ Responses by Authors Along with Relevant References
Additional Assignments for Enhancing Learning
Conclusion
References

Citation preview

Springer Business Cases

Gopal P. Mahapatra Editor

Business Cases in Organisation Behaviour and HRM Perspectives from India

Springer Business Cases Editorial Boards Mehtap Aldogan Eklund, Department of CBA—Accountancy, University of Wisconsin–La Crosse, La Crosse, WI, USA Karuna Jain, Shailesh J. Mehta School of Management, Indian Institute of Technology Bombay, Mumbai, India Dilip S. Mutum Malaysia

, School of Business, Monash University Malaysia, Subang Jaya,

Henry Shi, Faculty of Arts, Business, Law and Economics, University of Adelaide, Adelaide, Australia Marianna Sigala, Department of Business Administration, University of Piraeus, Athens, Greece

Springer Business Cases is a book series featuring the latest case studies in all areas of business, management, and finance, from around the world. The wellcurated case collections in each of the books represent insights and lessons that can be used both in the classroom as well as in professional contexts. The books also place a focus on regional and topical diversity as well as encouraging alternative viewpoints which bring the knowledge forward. Both teaching cases as well as research cases are welcome.

Gopal P. Mahapatra Editor

Business Cases in Organisation Behaviour and HRM Perspectives from India

Editor Gopal P. Mahapatra Faculty of Organizational Behavior and Human Resources Management Indian Institute of Management Bangalore (IIMB) Bengaluru, Karnataka, India

ISSN 2662-5431 ISSN 2662-544X (electronic) Springer Business Cases ISBN 978-981-99-2030-3 ISBN 978-981-99-2031-0 (eBook) https://doi.org/10.1007/978-981-99-2031-0 © The Editor(s) (if applicable) and The Author(s), under exclusive license to Springer Nature Singapore Pte Ltd. 2023 This work is subject to copyright. All rights are solely and exclusively licensed by the Publisher, whether the whole or part of the material is concerned, specifically the rights of translation, reprinting, reuse of illustrations, recitation, broadcasting, reproduction on microfilms or in any other physical way, and transmission or information storage and retrieval, electronic adaptation, computer software, or by similar or dissimilar methodology now known or hereafter developed. The use of general descriptive names, registered names, trademarks, service marks, etc. in this publication does not imply, even in the absence of a specific statement, that such names are exempt from the relevant protective laws and regulations and therefore free for general use. The publisher, the authors, and the editors are safe to assume that the advice and information in this book are believed to be true and accurate at the date of publication. Neither the publisher nor the authors or the editors give a warranty, expressed or implied, with respect to the material contained herein or for any errors or omissions that may have been made. The publisher remains neutral with regard to jurisdictional claims in published maps and institutional affiliations. This Springer imprint is published by the registered company Springer Nature Singapore Pte Ltd. The registered company address is: 152 Beach Road, #21-01/04 Gateway East, Singapore 189721, Singapore

In memory of late Prof. K. B. Akhilesh

Preface

The professional world is changing rapidly. With globalization and the pace of technological advancement, the world is changing into a Volatile, Uncertain, Complex, and Ambiguous (VUCA) environment, more so for businesses. In this challenging context, leaders and HR professionals must adopt new strategies to navigate and foster business growth, success, and sustainability. In the last decade, India has seen increasing significance given to leadership and human resources management for the growth and sustenance of business and social organizations. The approaches followed by the leaders have proven successful, particularly in the fields of people management, employee engagement, change management, entrepreneurship, and the like. In this context, the editor invited leading academicians and a few practitioners in organization behavior (OB), leadership, and human resource management (HRM) to submit business cases and teaching notes. We aim to facilitate learning and development through these cases on employee engagement, training and development, mergers and acquisitions, leading virtual teams, career management leveraging technology, and the broader areas of people management. All authors have carefully selected and highlighted cases of significance along with relevant teaching notes. This is likely to be quite valuable to academicians in B-schools in India and abroad; not to mention M.B.A. students, undergraduate students, leaders and HR professionals, practice owners, and consultants, who want to leverage these cases for leadership development, solving business problems as well as getting new insights into current people management issues. It has been a phenomenal learning experience for me, both as a contributing author and the editor of this particular OB and HRM case volume. I sincerely hope readers from various strata benefit from using this volume. I hope this book will contribute to teachers, professionals, and management graduates in B-schools. The teaching notes can benefit academicians who want to supplement their expertise without additional reference objectives and methodologies shared by the authors of the cases in the teaching notes.

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We will very much appreciate the comments and suggestions of the readers and users of this volume and wish a great learning experience to the readers! Gopal P. Mahapatra Faculty of Organizational Behavior and Human Resources Management Indian Institute of Management Bangalore (IIMB) Bengaluru, Karnataka, India

Acknowledgments

This book would not have been possible without the help of many notable people. I cannot list them all here, but would like to thank the Late Prof. K. B. Akhilesh, the erstwhile Dean of Indian Institute of Science (IISc), and my well-wisher who had taken the initiative of this mega project1 from India. He seriously conceptualized and envisioned creating and compiling a series of business cases in India’s context: the emerging economy. I am grateful to him for having entrusted me to edit the Organisation Behaviour and Human Resources Management (OB and HRM) case and teaching note volume published by Springer. I dedicate this volume to his memory! I must acknowledge the subsequent anchoring and moderation by Prof. Parameshwar Iyer, Distinguished Scientist and Professor of IISc. He took on the baton, arranged a series of meetings with the potential guest editors of subjects, and encouraged me to seek diverse cases from leading academicians. Thanks to him for his unwavering encouragement and valuable support. I am grateful to Ms. Nupoor Singh, Senior Editor, Springer, who took a personal interest in pursuing this idea. She inspired me to pursue the case and teaching note collection from diverse authors when I was preoccupied with a busy teaching term. In addition, she periodically reviewed the status update on the cases jointly with me, including required follow-up with the authors, and collaborated with Springer Nature Books Production. To sustain motivation, she even arranged a meeting with her Editorial Director to communicate how important the book was for Springer. I want to thank Mrs. Ramya Somasundaram, Project Coordinator, Books Production, Springer Nature, for following up with the authors for necessary updates and corrections, and her production team in Springer for undertaking the essential copywriting production and editing tasks to complete this book. I want to thank my Research Associate at IIMB, Ms. Inika, a bright postgraduate from King’s College, London, who provided her valuable support during the initial phases—preliminary review of manuscript, comments, and editing, which was very helpful as we began with the case writing and teaching notes.

1 The original project was a compilation of case studies in almost all management study areas under the Chief Editorship of Prof. Akhilesh. After his sad demise the project has to be dismantled and this book, which was a section in that megaproject, came into being. ix

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Acknowledgments

I also want to thank Ms. Amruta Londhe, my erstwhile Research Associate at IIMB, for her assistance at the beginning of this book project. I am grateful to my family for tolerating the time and engagement that I had to devote to this project over the last 3 years. Finally, I need to thank my esteemed contributors for their cases and teaching notes. They have not only taken the initiative of writing the cases and teaching notes on varied themes in the OB and HRM area in the Indian social and business context but have also shown a lot of patience and perseverance with this project, as it has taken multiple iterations and taken time beyond their normal expectations. Thanks a lot, indeed! Gopal P. Mahapatra Faculty of Organizational Behavior and Human Resources Management Indian Institute of Management Bangalore (IIMB) Bengaluru, Karnataka, India

Contents

Introduction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Gopal P. Mahapatra Growth and Transformation of Gujarat Gas Limited—An OD and HRD Perspective . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Gopal P. Mahapatra and Nidhi Vashishth PRADAN: A Journey of Continuing Relevance . . . . . . . . . . . . . . . . . . . . . . . . . . Smita Mohanty and Ajaya K. Samal Plantation of Hope: The Turnaround of Harissons Malayalam Ltd. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Manoranjan Dhal and Surya Prakash Pati Can Collaboration Thrive in a Virtual Environment?—An Enigma! . . . . Amit Gupta and Ranjan Kumar Mohapatra

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Engaging Virtual Teams in Uncertain Times: A Business Case on Cyient Ltd. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 117 Upam Pushpak Makhecha and Farheen Fathima Shaik Paradeep Phosphates Limited’s Story of Inclusive Growth and Harmony: A Case Study . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 141 Mousumi Padhi Start-Up to Scale-Up: The Changing Entrepreneurs’ Competencies . . . . 157 Padmaja Palekar, Gopal P. Mahapatra, and Parag Patankar Luminous Power—The ROI of the General Management Program . . . . . 173 Debolina Dutta and Tilak Raj Kapoor Siemens Gamesa Renewable Energy, India: Employee Engagement Initiatives on the Journey to the Deming Award . . . . . . . . . . . . . . . . . . . . . . . . . 203 Pragnya Acharya and Lalatendu Kesari Jena Leave Bank—A Unique Social Security Concept . . . . . . . . . . . . . . . . . . . . . . . . 223 Sanjeev Shantkumar Doshi and Upasna A. Agarwal

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Contents

Using Online Learning to Develop Pandemic Readiness: The Case of Deoleo in India . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 239 Rama Shankar Yadav, Sanket Sunand Dash, Siladitya Sarangi, and Ankur Jain The Being and Becoming of a Leader in STEM . . . . . . . . . . . . . . . . . . . . . . . . . 255 Sadhna Dash and Snigdha Pattnaik

Editor and Contributors

About the Editor Gopal P. Mahapatra is a Professor of Practice (OB and HRM area) at Indian Institute of Management (IIM) Bangalore. He is a Fellow from IIMB and comes with more than 30 years of HR leadership roles in MNCs and Indian conglomerates. He has been Programme Director and faculty member in Advanced Management Programme, and many other Executive Education Programmes at IIMB, in addition to serving as Chairperson Weekend M.B.A. Prior to this, he served at IIM Indore, and is also visiting faculty at IIM Kolkata and IIM Udaipur. Professor Mahapatra was President, National HRD (NHRD) Network Bangalore 2006–2008, which is an autonomous, not-for-profit, professionally managed organization of HR professionals. He has co-edited three books between 2002 and 2006, and edited two special issues of NHRD Network Journal on Organisation Development in 2008 and Neuro-Science and HR in 2018, in addition to having many papers in international and national journals to his credit.

Contributors Pragnya Acharya School of Human Resource Management, XIM University, Bhubaneswar, India Upasna A. Agarwal Indian Institute of Management Mumbai, Mumbai, India Sadhna Dash Jyoti Nivas College Autonomous, Bangalore, Bangalore, India Sanket Sunand Dash Assistant Professor in HRM and OB Area at Indian Institute of Management Rohtak, Rohtak, India Manoranjan Dhal Professor, Organizational Behaviour and Human Resource Management, Center for Employment Relations and Labour Studies, Indian Institute of Management Kozhikode, Kozhikode, Kerala, India Sanjeev Shantkumar Doshi Rashtriya Chemicals and Fertilizers Limited (RCF), Mumbai, India xiii

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Debolina Dutta Indian Institute of Management Bangalore, Bangalore, India Amit Gupta Indian Oil Corporation Limited, New Delhi, India Ankur Jain Assistant Professor in HRM and OB Area at Indian Institute of Management Rohtak, Rohtak, India Lalatendu Kesari Jena School of Human Resource Management, XIM University, Bhubaneswar, India Tilak Raj Kapoor DS Group, New Delhi, India Gopal P. Mahapatra Faculty of Organizational Behavior and Human Resources Management, Indian Institute of Management Bangalore (IIMB), Bengaluru, Karnataka, India Upam Pushpak Makhecha Indian Institute of Management, Tiruchirappalli, India Smita Mohanty Ghaziabad, UP, India Ranjan Kumar Mohapatra Indian Oil Corporation Limited, New Delhi, India Mousumi Padhi School of Human Resource Management, XIM University, Bhubaneswar, India Padmaja Palekar Faculty of Organizational Behavior and Human Resources Management, Indian Institute of Management Bangalore (IIMB), Bengaluru, Karnataka, India Parag Patankar Fintech Entrepreneur, and IIM, Ahmedabad, India Surya Prakash Pati Associate Professor, Organizational Behaviour and Human Resource Management, Center for Employment Relations and Labour Studies, Indian Institute of Management Kozhikode, Kozhikode, Kerala, India Snigdha Pattnaik Khandagiri, Bhubaneswar, India Ajaya K. Samal Noida, UP, India Siladitya Sarangi Country Manager, Deoleo, Mumbai, India Farheen Fathima Shaik Assistant Professor (Human Resource Management), XLRI - Xavier School of Management, Jamshedpur, Jharkhand, India Nidhi Vashishth Director in Charge-Fellow programs, Academy of HRD, Ahmedabad, India Rama Shankar Yadav Assistant Professor in HRM and OB Area at Indian Institute of Management Rohtak, Rohtak, India

Introduction Gopal P. Mahapatra

1

The VUCA Context

The world has been experiencing more disruptions and technological changes than ever before. Although recent reflections on industry-wide disturbances may emphasize the pandemic-related and post-pandemic differences in working and the workplace, rapid change and disruption have increased over the past two decades. In fact, in 2012, a BCG study found that half of the most turbulent financial quarters in the previous 30 years had occurred post-2004 (Sullivan, 2012). These rapid changes arise from all avenues, including digitization, technological advancements, population growth, political unrest, economic instability, national disasters, and cultural shifts, exacerbated after Fourth Industrial Revolution. This new business environment is frequently summarized using the acronym VUCA, which describes its Volatile, Uncertain, Complex, and Ambiguous nature. On an organizational level, VUCA can result in business complexity, rolling markets, changing competition, financial instability, and leadership challenges. On a personal level, it may reduce feelings of control and self-efficacy and increase stress, anxiety, depression, and suicidality (Doheny et al., 2012; Luthans & Broad, 2022). With VUCA, the revolution to Industry 5.0 is characterized by human and robotic systems focused on sustainable development (Akkaya & Ahmed, 2022). In this scenario, the responsibility is on organizational leadership and HR professionals across levels to protect company interest and employee well-being. Too often, VUCA is treated as synonymous with uncertainty to act as a crutch rather than a concept (Bennett & Lemoine, 2014a, 2014b). It is frequently used to justify failure due to insufficient foresight or adequate preparation. However, G. P. Mahapatra (B) Faculty of Organizational Behavior and Human Resources Management, Indian Institute of Management Bangalore (IIMB), Bengaluru, Karnataka, India e-mail: [email protected] © The Author(s), under exclusive license to Springer Nature Singapore Pte Ltd. 2023 G. P. Mahapatra (ed.), Business Cases in Organisation Behaviour and HRM, Springer Business Cases, https://doi.org/10.1007/978-981-99-2031-0_1

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G. P. Mahapatra

VUCA is a critical framework for understanding and appropriately addressing challenges. According to Bennett and Lemoine (2014b), VUCA can be a guideline for four distinct characteristics present in modern business challenges in isolation or combination. Volatility describes instability and unexpectedness of unknown duration and can be addressed through agility or building organizational slack and resources. Uncertainty is for situations where the mechanisms of cause and effect could be more explicit; this can be addressed through investing in information-gathering. Complexity involves the presence and overwhelming volume of interconnected parts and variables, typically requiring restructuring and specialist experts’ involvement. Finally, ambiguity arises in the face of “unknown unknowns” where experimentation may be used to understand the situation further. Complexity management strategies can also be applied directly to VUCA. As VUCA and complexity increase, leaders must embrace flux rather than resisting change; organizations can create a culture of learning, open-mindedness, and collaboration (Hanson, 2007). Complexity and response have a recursive relationship (Maylor & Turner, 2017). There is no scope for complacency—constant innovation and anticipation of trends are necessary. However, Hanson (2007) does concede that there are significant challenges related to multicultural/global/virtual settings, human skills/attitudes/capacities, collaboration, and related to industry/company. It is suggested that businesses require flexibility to adapt to VUCA; this requires flexible leadership with foresight, self-awareness, openness, knowledge, communication skills, and learning aptitude (Lawrence, 2013). Johansen (2007) further describes the skills and abilities needed to manage VUCA as VUCA Prime, namely, Vision, Understanding, Clarity, and Agility. Factors for business success include sound/fundamental business practices, innovation, fast responses, flexibility, change management, diversity management, market intelligence, and strong collaboration (Sarkar, 2016). Leadership exemplifies how an organization can respond to such an environment. VUCA thus requires CEOs to act in a fast, focused, and flexible way, summarized through the theory of “Leadership Agility”. Leadership agility can be evolved through training to improve focus on effective communication and engagement with diverse teams, risk-taking, independent thinking, and modeling of collaboration (Pasmore et al., 2010). Studies suggest that management innovation to address these changes should emphasize innovation, strategic vision, proactivity, creativity, customer focus and involvement, openness to learning, and context-dependent measures (Millar et al., 2018). These new leadership requirements must be reflected in management education and teaching pedagogy. Although it is understood that agility, self-awareness, comfort with ambiguity, and strategic thinking are essential to new-age leadership, previous training practices need to catch up (Lawrence, 2013). Hall and Rowland (2016) found that while VUCA and agile management are accepted, with attempts to integrate this in management coaching, a review of UK MBA programs evidenced general dissatisfaction with programs with only a few curricula supporting agile leaders. Organizational-level solutions may involve hiring and retaining employees with agility and learning and developing agility through scenario planning or simulations (Lawrence, 2013). To this end, the cases in this volume support

Introduction

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the development of leadership agility and progressive people management function in academia and practice.

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India—An Emerging Economy

India has been considered a significant economy since the emergence of BRICS. A recent marker of India’s economic growth was when the economy surged past its former colonizer, the UK, to become the fifth biggest economy in the world (Aldrick & Goodman, 2022). As noted by Aldrick and Goodman (2022) recently, the Indian economy was forecasted to grow by more than 7%. After a rebound in Indian stocks, India is now second after China in the MSCI Emerging Markets Index. An article published by Morgan Stanley (2022) further stated that as the world’s fastest growing economy, India is on track to becoming the world’s thirdlargest economy by 2027, expecting to surpass Japan and Germany and have the third-largest stock market by 2030. This growth can be attributed to global trends and investment choices; notably, as global labor markets tighten, significant offshoring—factory and labor—has been and is expected to be diverted to India. Similarly, it is expected that more Indian nationals will work foreign jobs from within India (Morgan Stanley, 2022). This is supplemented by early Indian uptake of digitization, a shift in Indian income distributions, and upgrades in energy distribution; all of which promote investment in the country. It is worth noting that global power entails more than economic growth. As Hopewell (2015) argued, India’s global power was also driven by its mobilization and leadership of developing country coalitions and alliances, which in the past may have allowed them to exercise influence considered above their economic weight. As India and China slowly rebuild cultural and economic bridges and their complementary strengths, this can benefit the more prominent global economy (Khanna, 2007). What is also clear is that the kinds of organizations which flourish in the two countries are very different from each other and the rest of the world (Khanna, 2007). Given India’s global standing, politically and economically, and the understanding of the unique business environment, organizations also need to emphasize the strategies required for success within the Indian context. It involves learning about the Indian business environment and emulating leadership and people management practices conducted by successful Indian companies rather than solely emulating and applying strategies from the Western market. Moreover, learnings from India may also be applied elsewhere, where relevant.

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Case Methodology for Management Education and Development

Case method is a pedagogical tool of active teaching which involves describing an actual situation or event presented as a self-contained story to learn from both as an example and through post-story reflection via questions, exercises, or games. In a more modern business setting, the case method of teaching is characterized by realistic managerial scenarios in which a difficult decision is being faced, taught through active instructor-guided teaching with a focus on discussion-based learning (Razali & Zainal, 2013). Participants must make decisions and take action despite adversity, such as incomplete information, time constraints, and conflicting goals (Afsouran et al., 2018). The introspective discussion-based environment allows participants to think more deeply and share their opinions and previous experiences freely while being open to feedback (Afsouran et al., 2018). Case method teaching allows students to experience challenging and complex managerial situations in a safe and supportive environment, so they can be prepared to face the same in the real world. Case methods are primarily used in business management education and executive training during MBA or higher education, but they are also used during organizational training, continued learning, and management development. Case methodology in management education allows participants to gain more practical knowledge, deep understanding, and powerful insights (compared to just reading to learn), through an engaging and interesting avenue. The potential benefits of case methods include the development of diagnostic skills, subject and functional integration, deep learning, student-involved and motivated learning, effective use of class time, development of team learning, group discussion process, the repeatable nature of cases, and the ability to review policy and practice if done in organizations (Rees & Porter, 2002). Although benefits are numerous, cases must also be used optimally to be practical teaching tools. Rees and Porter (2002) identified cases to be most effective when they have valid and specific learning outcomes when used before the theory is taught, when cases are combined to progress in complexity, and when students are reassured of the importance of the method (to prevent resistance). As early as 1994, there was already apparent resistance in Europe and Asia when using American business cases—due to cases not fitting the economic context and the teaching methods not fitting the cultural context (Saner & Yiu, 1994). Since then, universities and colleges worldwide have begun contributing cases based on their experiences and settings. Even so, there is still a skew toward American cases, with developing nations having a noticeable lack of comparable cases. Even with global cases in mind, there is a gap in cases that focus on the new VUCA setting and the agile management required to overcome this. This book includes Indian cases on leadership, change management, and people management cases set in MNCs, Indian conglomerates, or start-ups, emphasizing situations arising from VUCA to allow readers to gain practical knowledge relevant to this context.

Introduction

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This Book—Purpose and Topics of Interest

The current collection includes 12 handpicked cases and teaching notes on the various critical dimensions of OB and HRM, written by invitation, by Indian authors who are leading academics and practitioners. The primary purpose of this collection is to capture the unique circumstances, contextual thinking, analytic methods, decision-making processes, and innovative solutions used in OB and HRM in MNCs and Indian business and non-profit organizations. With a slight emphasis on the pandemic, a few cases cover the unique business challenges and situations arising from COVID-19. The themes covered include organizational transformation, organizational culture, and development, organizational innovation, corporate social responsibility, competencies for enhancing entrepreneurship, employee engagement, leading virtual teams, career management, training and development, and women leadership.

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Who is This Book For

This book is intended to be used by people in business, students, practitioners, and academicians, both in a global setting and for a more nuanced examination of OB and HRM in the Indian business context. Postgraduate students in management and organization professionals will benefit by critically examining recent industry changes and reflecting on how Indian leaders and organizations can adapt operations during these times. On the other hand, academics can use this book to highlight the critical concepts and dimensions of change, leadership, people management, and innovation.

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How the Book is Organized

The book is organized chapter-wise, with each chapter including a new case and the relevant teaching note at the end of the chapter as an Appendix (which may include questions for discussion, teaching plans, elaboration of concepts, and additional resources). The cases are ordered to go from more macro-perspective cases that may have broader applicability for management education to cases centered around more specific situations or topics that may not be as relevant for all readers. Nonetheless, concepts and types of complexity mentioned in every case can be helpful for all readers in non-business organizations due to the transferability of the discussions and learning. The topics covered in the 12 cases are ordered as follows: – Growth and transformation of Gujarat Gas Ltd.—an OD and HRD perspective: The growth and transformation of a large Indian organization through the decades have been elucidated from an OD and HRM perspective. The reader

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can understand how HRM systems and processes can be developed for a growing organization and how to change balance can be effectively implemented in M&A situations. PRADAN: A Journey of Continuing Relevance: An NGO’s journey and challenges in staying relevant, from inception to the current day. Through this case, readers can learn about the challenges faced during a company’s growth and how they can be proactively anticipated to maintain relevance even in turbulent times. Plantation of Hope: The Turnaround of Harrisons Malayalam Ltd.: This case examines the role and importance of having a good work culture through the lens of a legacy organization. This case supports readers in questioning the HRM practices that are sometimes taken for granted, allowing for critical thinking to improve employee experience and organizational culture. Can collaboration thrive in a virtual environment?—An enigma!: A discussion of company collaboration in a virtual environment. This case enables readers to creative solutions and out-of-box thinking by focusing on the example of virtual collaboration during the pandemic. Engaging Virtual Teams in Uncertain Times: A Business Case on Cyient Ltd.: Adaptation and progress in engaging virtual teams during uncertain times. Readers can get a flavor of the work it takes to adapt in turbulent and uncertain times and can reflect on the organizational attributes that remain integral during these times. Paradeep Phosphates Limited’s Story of Inclusive Growth and Harmony: This case study exemplifies inclusive growth methods to allow for a robust union-management relationship, increased transparency, and improved communication. This case supports readers in developing the skills to promote inclusive growth and frictionless collaboration, a cornerstone of modern business. Start-up to Scale-up—The Changing Entrepreneur’s Competencies: This case illustrates a powerful example of the changing entrepreneur competencies when scaling up from a Start-up to a meaningful, transparent, and customercentric business. Readers can see how company prerogatives and emphasis should shift as they scale up. The ROI of General Management Program: A demonstration of the role of a general management program in addressing workforce capability gaps. The reader can learn the importance of effective learning and development programs for employees and budding leaders and reflect on these programs’ content and mode. Siemens Gamesa Renewable Energy, India: Employee Engagement Initiatives on the Journey to the Deming Award: How employee engagement initiatives can be used to promote positive competency development. This case demonstrated employees’ role in company initiatives and taught readers how skills/competencies could be harnessed to facilitate growth. Leave Bank—A Unique Social Security Concept: Showing the use of a leave bank for employees through the times. Readers can be inspired by company

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initiatives to support their employees with empathy and can debate policies that can boost morale and receive organization-wide support. – Using online learning to develop pandemic readiness: The case of Deoleo in India: This case describes the process of developing pandemic readiness and adapting to business restrictions. With the example of digitization, readers can see the challenges of adapting to new technology and discuss the methods to facilitate the same. – On Leadership in STEM Professions: The journey of a woman leader in STEM. This personal case can support readers in considering still-present gender inequalities and how one can ensure a sustainable and prosperous leadership career despite the difficulties faced.

References Afsouran, N. R., Charkhabi, M., Siadat, S. A., Hoveida, R., Oreyzi, H. R., & Thornton III, G. C. (2018). Case-method teaching: Advantages and disadvantages in organizational training. Journal of Management Development. Akkaya, B., & Ahmed, J. (2022). VUCA-RR toward industry 5.0. In Agile management and VUCA-RR: Opportunities and threats in industry 4.0 towards society 5.0 (pp. 1–11). Emerald Publishing Limited. Aldrick, P. & Goodman, D. (2022). UK slips behind India to become World’s sixth biggest economy. Bloomberg.com. [online] 2 Sep. Available at: https://www.bloomberg.com/news/articles/ 2022-09-02/uk-slips-behind-india-to-become-world-s-sixth-biggest-economy Bennett, N., & Lemoine, J. (2014a). What VUCA really means for you. Harvard business review, 92(1/2). Bennett, N., & Lemoine, G. J. (2014b). What a difference a word makes: Understanding threats to performance in a VUCA world. Business Horizons, 57(3), 311–317. Doheny, M., Nagali, V., & Weig, F. (2012). Agile operations for volatile times. McKinsey Quarterly, 3, 126–131. Hall, R. D., & Rowland, C. A. (2016). Leadership development for managers in turbulent times. Journal of Management Development. Hanson, K. S. (2007). Emerging elements of leadership in a complex system: A cognitivist approach (Doctoral dissertation, University of San Diego and San Diego State University). Hopewell, K. (2015). Different paths to power: The rise of Brazil, India, and China at the World Trade Organization. Review of International Political Economy, 22(2), 311–338. Johansen, B. (2007). Get there early: Sensing the future to compete in the present. Berrett-Koehler Publishers. Khanna, T. (2007). China + India: The power of two. [online] Harvard Business Review. Available at: https://hbr.org/2007/12/china-india-the-power-of-two Lawrence, K. (2013). Developing leaders in a VUCA environment. UNC Executive Development, 2013, 1–15. Luthans, F., & Broad, J. D. (2022). Positive psychological capital to help combat the mental health fallout from the pandemic and VUCA environment. Organizational Dynamics, 51(2), 100817. Maylor, H., & Turner, N. (2017). Understand, reduce, respond: Project complexity management theory and practice. International Journal of Operations & Production Management. Millar, C. C., Groth, O., & Mahon, J. F. (2018). Management innovation in a VUCA world: Challenges and recommendations. California Management Review, 61(1), 5–14. Morgan Stanley. (2022). India: Asia’s star of the next decade. [online] Available at: https://www. morganstanley.com/ideas/investment-opportunities-in-india

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Pasmore, B., Horney, N., & O’Shea, T. (2010). Leadership agility: A business imperative for a VUCA world. People and Strategy, 33(4), 32. Razali, R., & Zainal, D. A. P. (2013). Assessing students’ acceptance of case method in software engineering education–a survey. Procedia-Social and Behavioral Sciences, 93, 1562–1568. Rees, W. D., & Porter, C. (2002). The use of case studies in management training and development. Part 1. Industrial and Commercial Training. Saner, R., & Yiu, L. (1994). European and Asian resistance to the use of the American case method in management training: Possible cultural and systemic incongruencies. International Journal of Human Resource Management, 5(4), 953–976. Sarkar, A. (2016). We live in a VUCA world: The importance of responsible leadership. Development and Learning in Organizations: An International Journal. Sullivan, J. (2012). VUCA: The new normal for talent management and workforce planning. Ere. Net.

Gopal P. Mahapatra is a Professor of Practice (OB & HRM area) at Indian Institute of Management (IIM) Bangalore. He is a Fellow (Doctoral Programme) from IIMB and comes with more than thirty years of HR leadership roles in MNCs and Indian conglomerates. He has been Programme Director and faculty member in Advanced Management Programme, and many other Executive Education Programmes at IIMB, in addition to serving as Chairperson Weekend MBA. Prior to this, he served at IIM Indore, and is also visiting faculty at IIM Kolkata and IIM Udaipur. Prof. Mahapatra was President, National HRD (NHRD) Network Bangalore 2006–08, which is an autonomous, not-for-profit, professionally managed organization of HR professionals. He has co-edited three books between, and edited two special issue of NHRD Network Journal on ‘Organisation Development’ in 2008 and ‘Neuro-Science and HR’ in 2018, in addition to having many papers and cases in international and national journals to his credit.

Growth and Transformation of Gujarat Gas Limited—An OD and HRD Perspective Gopal P. Mahapatra and Nidhi Vashishth

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Introduction

February 1, 2021 was not another routine Monday for Peeush Upadhyay, Executive Director—HR and Admin. of Gujarat Gas Limited (GGL), Ahmedabad, India. A reputed external institution recognized GGL’s focused management efforts for the growth and transformation of the business, while keeping employees at the core of every decision. GGL got nominated for the prestigious Business Excellence Award. There has been excitement at GGL corporate office, and preparation for the evaluation for the award has commenced. Sanjeev Kumar IAS, a top civil servant and the Managing Director of GGL, reviewed the presentation for a meeting with the Awards Committee. He was briefed by Upadhyay to highlight core HRD practices as a strength and to project unique HRD/OD interventions that had fostered GGL’s success in an increasingly competitive environment. GGL’s growth and success journey has been inspiring, as it has remained profitable for the past decade, despite several mergers/acquisitions (M&A) and having undergone significant structural changes. The HR team of the company has played a significant role in ensuring the effectiveness of M&A execution at all phases. However, at the time of the REVERSE privatization of e-GGCL (Gujarat Gas Company Limited) with the public sector organization Gujarat State Petroleum Corporation (GSPC) Gas (GSPC Gas), as Head of the HR Department, Upadhyay G. P. Mahapatra (B) Faculty of Organizational Behavior and Human Resources Management, Indian Institute of Management Bangalore (IIMB), Bengaluru, Karnataka, India e-mail: [email protected] N. Vashishth Director in Charge-Fellow programs, Academy of HRD, Ahmedabad, India e-mail: [email protected] © The Author(s), under exclusive license to Springer Nature Singapore Pte Ltd. 2023 G. P. Mahapatra (ed.), Business Cases in Organisation Behaviour and HRM, Springer Business Cases, https://doi.org/10.1007/978-981-99-2031-0_2

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had to address several challenges. Reminiscing about this, he retrospected, “What is it that Gujarat Gas Limited Management could have done differently throughout various phases to ensure business continuity, strengthen culture, enhance growth, and leverage the company’s potential as a pioneer in natural gas distribution? How could the opportunities and challenges be best presented before the committee?”. The day of the meeting with the Awards Committee finally arrived. The Business Excellence Awards evaluation committee was in contact with the GGL office. Upadhyay was looking forward to meeting the Awards Committee to represent GGL and share his experience working at India’s largest city gas distribution company. After a brief exchange of pleasantries, Subrata, the Business Editor of a leading Journal, asked, “From a Mafatlal group company to a multinational company and now a public sector organization, in your opinion, how did GGL make it this far?”. Upadhyay replied, “It is the rich culture, HR practices, OD initiatives, commitment towards CSR, and a sharp business focus that has kept Gujarat Gas a steady company to look for and a great organization to work.” Then, he shared the evolution of GGL in chronological order recounting the origin and growth story of the organization. Upadhyay and the team reflected on the role of the HR department in the organization’s growth over the years. He also reviewed his GGL journey as a senior HR department member.

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Company History

2.1

Birth of GGCL (Now GGL)

India started attracting investments from across the globe due to the new economic reforms in 1991 due to the government’s efforts and policies for globalization, liberalization, and privatization, which aimed at making India one of the top economies in the world. During the 1960s–90s, Gujarat state established itself as a leader in various industrial sectors, including textiles, engineering, chemicals, petrochemicals, pharmaceuticals, dairy, cement, ceramics, gems, and jewelry; proving itself to have a business-friendly atmosphere. At that time, the distribution of natural gas was an arduous task, and ONGC, the first formally traded oil and natural gas company, supported the Government of Gujarat’s Gujarat Industrial Investment Corporation (GIIC) to provide natural gas to industrial and commercial units in 1980. In 1989, when natural gas was found in abundance near the gas field areas of Ankleshwar and Surat, the government harnessed available resources by encouraging corporates to form partnerships. At that time, Hrishikesh Mafatlal (Chairman, Arvind Mafatlal Group), a leading Indian conglomerate, sponsored Gujarat Gas Company Limited (GGCL), an associate sector company with an initial investment of 4 Crores Indian Rupees in 1990 (approx. $16,11,610). Of its shares, 35% were with GGCL, 15% with GIIC, and the rest with the public. Initially, it started

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natural gas distribution for piped natural gas, which was still a novel practice in Indian industrial cities. Upadhyay described, “GGCL was registered as a joint venture (JV) gas company of Gujarat State Government Corporation, Gujarat Industrial Investment Corporation (GIIC) with Mafatlal Group and operated in the business of procuring and distributing natural gas.”

2.2

Acquisition by British Gas and Merger with GSPC

The GGCL went public in October 1991, and the British Gas (BG) Group acquired a majority of its stake of 65.12% in 1997 to expand its wings and strengthen its business value chain to leverage the current assets and profitability in the Indian market. “The acquisition marked a new phase for GGCL. It witnessed a strong orientation for safety, compliance, and detailed orientation, which transformed the organization and created a culture of policy and process integration with a strong business focus,” Upadhyay explained. Any company in the oil, gas, and petroleum industry can be classified into three primary groups depending on their function in the supply chain: upstream, downstream, and midstream. Upstream business involves identifying, exploring, extracting, and producing raw materials from the Earth’s crust. In contrast, the midstream business involves transporting and storing raw products before they are refined and processed into fuels and essential elements. The downstream business involves converting raw materials and resources into finished products and delivering them to customers (https://www.forbes.com/companies/repsol/?sh=167 409b17c2a). The BG Group decided to divest downstream assets and invited bids for its stake in GGCL in November 2011, as it was expanding its business outside India and wanted to concentrate on the upstream business. BG had a long-term local natural gas (LNG) contract to maximize its position in the upstream market and decided to sell its stake in GGCL. GGCL’s market capitalization at that time stood at 3,937 crores INR. GGCL’s catering CNG segment had continued to grow, with 5,800+ vehicles converted to natural gas and 10,700+ households connected to the gas supply in the July 2012 quarter. The then Chief Minister of Gujarat and now Prime Minister of the country, Shri Narendra Modi, wanted to preserve the unique organization and decided to make it a state-owned entity. With this vision, in 2013, Gujarat State Petroleum Corporation Limited (GSPC), through its subsidiary, Gujarat Distribution Networks Limited (GDNL), acquired majority stakes (65.12%) in GGCL from BG (Financial Express, 2002; Rediff News, 1998). The acquisition of GGCL had significant strategic importance and added a considerable customer base to GSPC’s existing business in Gujarat (Economic Times, 2012; Business Line, 2013; Times of India, 2012). The acquisition was also consistent with the company’s stated strategic objective of expanding its presence in upstream and downstream segments of the

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energy value chain and realizing the vision of developing Gujarat as a natural gasdriven economy. The companies finally merged to become Gujarat Gas Limited in 2015.

2.3

GGL Today

Gujarat Gas Limited (GGL) in 2022 is India’s most extensive city gas distribution (CGD) player and has its presence in 43 districts in the states of Gujarat, Maharashtra, Madhya Pradesh, Rajasthan, Haryana and Punjab, and in the Union Territory of Dadra and Nagar Haveli (https://www.gujaratgas.com/about-us/thecompany/). The company had India’s most extensive residential, commercial, and industrial customer base. In the words of a GGL veteran, “The company is a unique example of being a joint venture organization and becoming a multinational organization and then again becoming a state-owned organization through a reverse merger. The culture, HRD practices, and OD interventions played a crucial role in determining the organization’s future.” GGL has more than 15.5 lakh household customers, over 13,000 commercial customers, 559 CNG stations, over 4,000 industrial customers, and close to 30,000 km of natural gas pipeline network (https://www.gujaratgas.com/about-us/the-company/). Overall, based on the history and evolution of GGL, it is evident that the evolution and impact of OD and HRD practices have played a critical role in the culture formation, development, and growth of GGL.

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OD and HRD Interventions

3.1

Phase I: Era of Experimentation and Exploration

In the early 1990s, the Management of GGCL had complete empowerment from both Mafatlal and the GIIC, allowing them to leverage their intrapreneurial capabilities to develop the company at a rapid pace. During that time, the company established its training center in Bharuch and formed a strong HRD department (Economic Times, 2021). The company’s primary objectives were marketing, providing quality customer service, and upholding high safety standards. Early customer response was positive, and the company grew with high customer centricity. Visionary leadership at that time focused on three pillars: experimentation, exploration, and innovation. The GGCL quickly adopted pioneering human resource development practices under F. B. Virani, the then Managing Director of the organization. He helped lead and build a culture where all were encouraged to experiment, make mistakes, and learn from them. There was little resistance to change, and the enabling environment flourished under dynamic top management leadership with few significant interventions. However, during the rapid growth stage (1994–1997), the business flourished and immediately recognized the need

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for reskilling talent, enhancing customer satisfaction, and more. Fostering a culture that encouraged employee involvement, safety, and swift and speedy customer support was the need of the hour. Keeping this objective in mind, the company adopted various HRD interventions and total quality routes. They used tools such as HRD audit, vision, customer satisfaction and employee satisfaction surveys, integrated talent management using performance management, and potential appraisal and reward systems (PPRDS) (Annexure I).

3.2

Phase II: Growth That Propelled Acquisition by British Gas

In 1997, a significant change occurred for the GGCL when the British Gas (BG) Group acquired significant stakes from the Mafatlals. The resulting vision statement and core values at GGCL are shown in Annexure II. The new acquisition caused a sense of insecurity among employees. People were worried about the new management, new culture, losing their position and job, increased workload, and more. A senior ex-employee of GGL quipped, “BG Group had now acquired the group, and it changed the organization’s DNA forever. The employee unions got established because the employees were apprehensive about many sensitive issues, especially job security. Hence, the employees decided to create a union for the common welfare and protection of their rights.” The company’s primary focus thus shifted toward employee engagement, employee satisfaction, health and safety, customer service, leadership development, and performance management. In the 2000s, with rapid growth and scaling up, the company adopted significant interventions while keeping the primary objectives in mind. At first, HR needed to rebuild employee trust and reinstate the trade unions’ faith in the management; this led to GGCL shifting its focus to cultural realignment to improve employee and customer engagement. Employee and customer satisfaction surveys were an ongoing part of GGCL culture. Grow Talent Company Ltd., a leading consulting firm, was hired to conduct employee satisfaction surveys to understand how workers perceived the quality of their working relationships and workplace culture. The company had taken these initiatives to drive engagement, commitment, satisfaction, and retention. Surveys indicated that employee communication, performance management, and reward and recognition practices needed attention. Surveys also indicated employee concerns regarding job security. The top management focused sharply on these areas, rebuilding trust and collaboration and instilling a sense of pride in the employees. HR specifically worked in various ways to address job security issues, for example, the company conducts these surveys periodically every financial year to identify the issues faced by customers and employees to try and resolve them as early as possible (https://www.gujaratgas.com/resources/dow nloads/business-responsibility-report.pdf). Furthermore, GGCL’s top management developed a golden handshake scheme to enhance the workforce’s performance. The scheme involved an online performance management system that tracks down the continuous developmental plan

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of every individual. All HR-related policies were also updated on the system to ensure proper communication. After the acquisition, the GGCL focused on standardized mechanisms and standard operating procedures (SOPs) to establish effective control and monitoring mechanisms aligning processes with a safety culture. There were many behavioralbased safety training programs, and overall, the focus shifted from developmental HR to IR since management was concerned about the employee safety protocols, a separate department, Health Safety Security and Environment, was also set up (Annexure III). Finally, as a responsible organization, the GGCL recognized its obligations to positively impact society and the environment through continuous formal and informal initiatives. GGCL developed a part-time training and skill-building program for auto-mechanics to inculcate an awareness of CNG’s needs to meet the business needs and benefit the community. GGCL also strengthened relationships with government and external stakeholders for future growth and support (Annexure I). Through the said initiatives, GGL moved the overall focus to people inclusion toward community and environment (Annexure IV). GGL has done phenomenal work in corporate social responsibility (CSR), recognized in Gujarat and nationally (Annexure V). On the growth over the years of GGL, Upadhyay shared, “The period up to 2012 was an era of growth, and the company witnessed major activities that boosted the organization’s growth and development” (Annexure VI).

3.3

Phase III: Merger and Consolidation with GSPC Group and Growth to Date

2007–2013 was initially a period of growth for GGCL, but this volume and growth stagnated toward the end of 2013. Despite this, the GGCL followed employee benefit schemes, including post-employment benefit plans, defined contribution plans, long-term employment benefits, short-term employment benefits, and ESOPs (Annexure VII). On the other hand, Gujarat State Petroleum Corporation Ltd. (GSPC) was the start-up city gas distribution (CGD) arm of the Gujarat State Petrochemical group, which began its operations in 2006. By 2012, it had become the largest CGD company in India, surpassing established players through aggressive project execution and by identifying, prioritizing, and relentlessly pursuing high-growth avenues. The significant facts of GSPC Gas through an HR prism are summarized (Annexure VI). In 2013, GSPC, through its subsidiary Gujarat Distribution Networks Ltd. (GDNL), acquired the stakes in GGCL from the BG Group (Annexure IX). The reverse merger has brought a new dimension to the company’s functioning. After

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the GSPC took over management control of the GGCL in 2013, the two companies continued to run as separate entities for 2 years while merger options were evaluated and finalized. On the one hand, under BG management, GGCL looked at a larger picture of global standards as an MNC in natural gas distribution and occupational health and safety. While the GGCL was aligned with global practices, the GSPC management and culture looked at the local context, state government policy and procedures, and existing service conditions of the GSPC and its associated companies. It was the marriage of two drastically different company cultures poised for integration. Finally, the combined entity was named Gujarat Gas Limited (GGL) and was listed in 2015. Post-merger, the combined entity business registered significant growth, led to wealth creation for shareholders, and soon became India’s most significant city gas distribution player. Some wondered whether it was situational. The actual ground-level reality vis-à-vis previously identified challenges was checked to determine the efficacy of HR integration and the merger’s success.

3.4

Challenges as a Combined Entity, GGL

GGL focused on collaborating strengths, creating value, and growing markets. The reverse merger brought new opportunities and challenges for the HRD team. On the one hand, GSPC Gas employees were delighted to get the backing of a cashrich and process-oriented company, and the reports said they were looking forward to rapid growth, having acquired a reputed MNC. However, employees needed more satisfaction regarding the distribution of portfolios and the assignment of roles and responsibilities. Furthermore, many top- and middle-level management officials decided to leave during M&As since the company would become a public sector organization. Additionally, new employees joined the GGCL through direct recruitment on a contractual basis, creating significant issues among existing employees and resulting in the absence of a cohesive work atmosphere. Therefore, GGL decided to make new changes to its employment terms, which differed from the earlier practices used in GSPC and GGCL (Annexure VI and Annexure VII). The other significant HRD challenges for the HR team during the period 2014–2016 were as follows: 1. The GGCL worked on a vertical structure with more specialized functions and a skilled workforce in the industry segment. In contrast, the GSPC had a horizontal structure and worked on a more focused project approach and strategies to expand the business. 2. The speed of execution across both companies was different. 3. The growth trajectory of both organizations was different. 4. The organizational structure of both erstwhile companies was different. There was a need for a significant structural redesign. 5. The pay grades and compensation of both entities need alignment.

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6. 7. 8. 9.

Merging of HR or ERP systems, SOPs, and processes to leverage strengths. Realignment of culture and operational philosophy/practices of both entities. The changing face of leaders and leadership approaches. Aligning roles, responsibilities, designations, HR policies, employee benefits, and service conditions. 10. Employee retention and well-being. 11. Legal compliance with changes in the firm’s name and changes in registrations.

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Actions by the New Head HR

While looking at the scenario, Upadhyay took charge of leading HR and Admin. He analyzed the situation to find the best possible solutions for protecting the interest of the employees and the organization. GGL, as a merged entity, had the strengths and weaknesses of both erstwhile companies, i.e., GGCL and GSPC Gas. The integration of two different organizational structures and cultures could cause problems and, if not handled well, could lead to merger and acquisition failure. For the smooth changeover, the GGL MD met with managers above senior manager level and change management agents were nominated among them across the company. This philosophy helped communicate the proper business agenda; provide continuous communication through various stakeholders on the M&A process; and cover various HR aspects, including job security, culture enhancement, and mitigating the risk across the organization. Peeush also looked into the past, relied on his experience, and studied various previous interventions to manage the M&A challenges. After thoroughly evaluating the challenges and understanding the current situation, Peeush attempted the best possible solution “to merge the various service conditions and create an equitable and fair single layer identity for all the employees.” Key HR-led initiatives incorporated on a priority basis included the following: . GGCL employees were on the company payroll, while GSPC Gas employees were in a contract role. Thus, all employees of erstwhile GSPC Gas were accommodated at par on the role, securing the job of employees. . Defining/implementing organizational structure along with accountability across levels. . Defining the financial authority matrix for proper business processes. . Implementing the best HR policies from both companies. . C&B alignment (median-based salary alignment) across the levels and implemented in 2 years to bring compensation and benefit at par. . Implementing the L&D philosophy across the company, including various OD interventions, viz., Shabassh Card/Pinnacle Award/Safety Awards on a monthly/ quarterly/yearly basis.

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. Implementing digitalization for all business and HR processes, including approval notes and policy implementation. . HR visits across locations to explain various HR processes and policies along with discussion for any query related to M&A. . Various cross-functional meets and departmental meets. Overall, the post-merger was a challenging time for the top management, especially for the HR team. However, Upadhyay handled it well, with the support of the MD, the senior management, and the HR team members, he was able to maintain the synergy and ensure that the organization’s business was positively affected despite the present challenges. Upadhyay added, “In the middle of difficulty lies opportunity, and we started exploring all options which would help us sail through as the winner.” These opportunities were as follows: 1. Target untapped areas and extend boundaries: The compressed gas distribution for the city grew exponentially at a rate of 10% in the last decade and is expected to grow 20–22% over the next decade. Thus, there was a massive opportunity for the organization to scale up and grow outside the boundaries of Gujarat to supply high-quality, low-cost energy across India safely. Many untapped areas had high commercial viability and margins, leading to profitability and growth potential. 2. Reskill employees: To meet the considerable need for new, high-end skill sets, GGL encouraged employees to be trained and invest themselves in acquiring high-end skills rather than hiring a new pool of talent of diploma holders and fresh engineers. 3. Change Management: Rapid growth in the sector and concurrent impact on the organization’s growth opportunities pose an excellent opportunity for management changes by top leadership. This involved leading change for the organization, its stakeholders, the customer, the investors (Govt.), and finally having employees implement and, more often than not, initiate changes as the pioneers in the field.

4.1

Final Interaction with the MD

Before concluding his study, Subrata also explored the possibility of meeting the MD for his closing remarks. Upadhyay made some efforts and organized the same. So, there came the opportunity for the award committee to interact with the head of the institution of this mammoth organization. Subrata was well prepared and keen to gain the maximum from the brief meeting, so he presented four specific questions: . What is your brief perspective on culture and people management in Gujarat Gas today? The MD replied, “The culture here is a healthy blend of professionalism and commitment to social objectives. Its strong focus on processes,

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safety-first culture, and adoption of global best practices has made it a breeding ground for talent in the CGD sector. I am proud to say that today, most of the CGD companies in India have Gujarat Gas-trained personnel at key positions in their organization. Training and upgrading people’s skill sets have always been an integral part of our culture….” . Going ahead, he asked, given Gujarat Gas’s rich and diverse history, where do you visualize its journey ahead? He replied, “…We believe in strategically aligning ourselves to energize India’s Natural Gas Vision of increasing the natural gas penetration to 15% by 2030 from currently at 6.5–7%. This approach enabled raise our execution capabilities. I am proud to say that GGL is no more a one-state company. It now has a presence in six states and one Union Territory..” . Specifically, in HRD/people management and change management, we would request to highlight your future perspective. “We have a vast reservoir of CGD talent, developed by putting in place key HR processes leading to a high-performance culture across the organization, as per the need to meet organizational objectives. However, along with changing environment, we need to change their mindset from a pipeline-laying outfit to a marketing company. Natural Gas is no more a commodity for us at GGL. We must treat it as a product and market it with strong customer service.” After listening to the story of this unique organization, Business Editor Subrata thanked the MD for his time and Upadhyay for his hospitality, as well as complimented him on his efforts and success, and wished him all the best for the future. It was 7.30 p.m., and Hardip, Associate Vice President HR, GGL, who was waiting for his boss, curiously asked him about the meeting with the awards committee. Upadhyay replied, “The discussions were positive, and we can expect positive development in a few days. Nevertheless, why are you looking tense?” AVP HR hesitatingly shared that the head of a critical business vertical had resigned, and he was concerned about finding a replacement. Upadhyay calmly replied, “We are a leading CGD organization, and challenges of talent loss, succession planning, safety, compliance, and continuous skill development, will keep appearing. However, we will work out strategies to resolve them. We will reflect and determine what to do differently in our HR & OD practices to develop GGL as a market leader and remain one of the best places to work.”

5

Present Challenge Before Head HR and GGL HR Team

Three decades of GGL witnessed innovation, nurturing a culture of collaboration, enabling technical supremacy, ensuring health and safety, and enhancing the focus on stakeholders. Since its inception, the adoption of sound HRD and OD practices with a consistent focus on people practices has made it a unique organization and established human resources as a competitive advantage. The vision of top and

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potential leaders directed the firm to grow exponentially. After a successful presentation to the award committee, Upadhyay is pleased and optimistic. However, after the discussion with Hardip, AVP-HR and his direct report, he was concerned about the potential talent loss and deeply pondered the importance of talent management for the foreseeable future. He considered his next move and plan of action to resolve the current issue.

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Case Questions

1. How did the GGL organizational culture evolve? Describe the various phases and their impact on culture. 2. What was the primary goal of the HRD team across all the phases of HRD and OD interventions? 3. What was the focus of the HRD team across all phases? Was it talent retention, cultural integration, quality customer service, or expansion and growth? 4. In light of recent challenges, what is a loophole in the existing HRD practices? What further actions should indeed be taken to improve the culture? 5. In the position of Upadhyay; how would you design HRD/OD interventions in today’s context to avoid top management loss? What will be your plan of action for organizational growth going forward? 6. How is HR the key to any successful merger and acquisition? What are the main parameters for human resources during a merger and acquisition?

Acknowledgements This case is developed solely for class discussion and not necessarily an indication of the management’s decision-making style. The authors are grateful to GGL Chairman, MD, Mr. Ravindra Agrawal, ED GSPC; Mr. Peeush Upadhyay, ED HRD; and Mr. Hardip Baria, AVP HR for their invaluable support; and Ms. Amruta Londhe and Inika Sharma, Research Associate IIMB for valuable assistance.

Annexure I: HRD Interventions Phase 1: HRD and Management Interventions in the Early Years of GGCL 1. HRD Audit: While the company started excelling as a pioneer, it proactively recognized the need for technical training and customer service. Profitability and growth meant upskilling talent, which was not readily available in India, particularly in the region. Hence, top management engaged T.V. Rao (Professor of IIM Ahmedabad and ex-Director of the Academy of HRD) to take stock of HRD activities and to recommend future steps.

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2. Vision and Mission of Gujarat Gas: Senior Management believed in quality, customer service, and employee involvement. They engaged a consulting firm specializing in “Total Quality Management (TQM)” to develop a vision and mission statement with values present company-wide. 3. Employee Satisfaction Survey: The organization focused on building a culture of quality services, creating the frameworks of TQM for internal customers and employees and “Employee Satisfaction Surveys” and “Customer Satisfaction Surveys” for external customers. Additionally, the “Train the Trainer” initiative was launched, and a rigorous review mechanism was adopted. 4. Customer Satisfaction Survey: Senior management wanted to achieve significant benchmarks by measuring customer service experiences and identifying areas for improvement. GGCL engaged a global consulting firm for the customer satisfaction survey. The results indicated 90–95% satisfaction among industrial, commercial, and domestic customers. However, challenges included safety and continuity of service standards, which management subsequently prioritized. 5. Leadership Development: GGCL nominated top talent and high potential managers to leading B Schools, e.g., Three-Tier Leadership Programmes in IIM Ahmedabad. The Customer Interaction Team (CIT) was sent to the USA to train on the best practices and bring them back to the line. Employee and customer satisfaction surveys identified improvement areas, and trainers focused on the same topic. 5S, Japanese tools were implemented for housekeeping and cleanliness. Rewards and recognition were similarly used for growth. 6. Defining and managing performances: A 180-degree performance management system was introduced, and performance scores were brought on the common platform during leadership meetings. This allowed anyone to question scores and challenge deviation. Performance review committees were set up to assess the overall candidate potential. The integration of HR into organizational systems shaped a culture of systemdriven practices and enablement. “GGL had a systems-driven culture at that time; interventions involved everyone, helping achieve exceptional teamwork and organizational skills.” Note 5S—In Japanese, the five Ss imply Seiri, Seiton, Seiso, Seiketsu, and Shitsuke. The five Ss are translated in English as Sort, Set in Order, Shine, Standardize, and Sustain. Source Compiled from GCL’s internal documents.

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Phase II: HRD and OD Interventions (BG Group Acquired the Company) . Employee engagement, Employee Satisfaction Surveys (ESS), and interventions Beginning with the total quality journey in 1994–95, employee satisfaction survey and customer satisfaction survey were an ongoing part of GGCL’s culture. The survey was conducted through the consulting firm Grow Talent Company Ltd. The firm conducted the ESS–Great Places to Work Survey in October 2003 to gain insights into employee perceptions of workplace relationships and culture. The company took these initiatives to improve the satisfaction levels within the organization (Economic Times, 2021). The key measures were credibility, respect, fairness, pride, and camaraderie. The company conducts these surveys periodically every financial year to identify issues and resolve them as early as possible (https:/ /www.gujaratgas.com/resources/downloads/business-responsibility-report.pdf). . Employee Communication, consolidation, retention, and redeployment Employee satisfaction surveys showed concern about employee communication, so HR needed to rebuild employee trust and reinstate the trade unions’ faith. During this time, the management decided to consolidate business in core gas distribution, with no ancillary business to be carried out. Gujarat Gas Financial Services Limited, a subsidiary company of GGCL incorporated in 1994, was divested. . Golden Handshake and Reinventing Performance Management System GGCL’s management decided to go for the golden handshake scheme in 2003 to enhance productivity and rationalize the workforce. Continuous developmental plans were created with a 3-year cycle to focus on organizational, functional, behavioral, and future-role needs. The promotion policy, exit policy, transfer policy, employment policy, and intra- and intercommunication systems were reviewed in detail. . Strengthening relations with government and external stakeholders Although GGCL was government-promoted, relationships with government agencies and other stakeholders needed strengthening, so a Director of Government Relations was appointed. The company also added verticals such as advertising/ publicity, corporate social responsibility, media relations, and investor relations.

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It moved from a uniform, rigid organization to a more diverse one incorporating corporate and investor relations consolidation. . CEVA movement as a significant OD intervention CNG business consolidation and diversification led to the birth of the customer and employee value addition—the CEVA movement. The organization was divided into cross-functional teams to study the concerns and pinpoint areas needing realignment or restructuring. Surveys have indicated that performance management and reward and recognition practices need attention. The top management focused sharply on these areas, taking steps to rebuild trust and collaboration. . CSR and skill development contribution to socioenvironmental awareness Leadership change encouraged sustainability interventions shifting the focus from petrol to CNG. A part-time training and skill-building program was launched to inculcate an awareness of CNG needs. This initiative increased the availability of trained auto-mechanics whom the vehicle owners could trust to convert their petrol-driven cars to CNG. CSR initiatives were carefully planned to benefit the communities in which the company operated. For example, a program devised to train the tribal youth of Bharuch District in gas pipeline-laying activities increased the youth’s earnings by 100–300%. With the focus shifting from IR to HR, employee satisfaction grew from 42% in 2004 to 83% in 2007. Source Compiled from GCL’s internal documents.

Annexure II: Vision Statement and Core Values at GGCL Vision: We make natural gas the safe and preferred energy solution. Core Values: Customer orientation, Team work, Commitment, Growth, Trust.

Source GGCL Annual Report 2013.

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Annexure III: Health Safety and Environment Gujarat Gas Limited is an OHSAS 18001:2007 and ISO 14001:2015 certified company. The company ensures that all management decisions reflect its Health Safety and Environment (HSE) intentions. GGL considers its employees’ health and safety, environmental protection, and general public safety as top priorities. It recognizes that the protection of health and safety and the environment is integral to business performance and is the responsibility of the management at every level. The goal of zero injuries drives operations to ensure that every employee working for and on behalf of GGL returns home safely at the end of each working day. Source GCL internal documents.

Annexure IV: People’s Inclusion Toward Community and Environment at GCL As a responsible organization, the GGCL recognized its obligations to positively impact society and the environment through continuous formal and informal initiatives. Initiatives included A. Environmental Day/Week/Fuel Conservation Awareness: Such activities were conducted to raise awareness among the public for sustainability. B. Dial Before Dig Campaign: In this campaign, GGCL stressed the possibility of natural gas being released due to pipeline damage during digging. Stakeholders were urged to dial GGCL to confirm locations before digging activities to prevent damage to the pipeline network. C. CSR and Society: Before beginning activities, project relevance is assessed by one or more employees who visit the location to ensure the selection of the most relevant and effective programs. The GGCL has thus undertaken many initiatives in community development, especially for skill upgradation. Indigenous people around areas of operation are trained and taken on as contractors, achieving lower worker attrition rates and providing livelihoods. D. Customers: GGCL assured customers of the best services available in the market, and to ensure this, they had a well-defined, periodically performed customer satisfaction survey. Top management also regularly conducts customer meetings with key customers. Source Compiled from GCL’s internal documents.

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Annexure V: Corporate Social Responsibility Gujarat Gas Limited has undertaken many initiatives focusing on community development, health, and the environment, keeping in mind government priorities and relevance to business. . GGL provides free gas to crematoriums across its operating locations in Gujarat. Since this is an environmentally friendly fuel, this helps to protect the environment. . Contributions were made to the Chief Minister’s Relief Fund and Swachchta Fund to provide flood relief to Gujarat people and create public awareness for cleanliness. . Contributed to Akshaya Patra Foundation to set up a centralized kitchen in Bhavnagar District to provide unlimited mid-day meals for government schoolgoing children. . Contributed to the “Gujarat Environment Festival” to celebrate World Environment Day at Ahmedabad to promote the freeing of one lakh trees from possible threats. . Under corporate governance, activities are listed in the board and annual report (i.e., Annexure I of annual report for 2015–16, 2016–17, and 2017–18). . The compliance certificate toward corporate governance issued by the practising company secretary is showcased in the corporate governance report for 2015– 16, 2016–17, and 2017–18. Since 2016–17, the business responsibility report activity has been introduced and has been part of the annual report. Source Compiled from GCL’s internal documents.

Annexure VI: The Significant Facts of GSPC Gas Through an HR Prism (Summarized) (a) All employees were on fixed-term contract roles with a renewal option. (b) No blue-collar workforce: all control room operations, and most customer services, admin, and facilities management were outsourced to optimize costs with adequate managerial monitoring of all services. (c) Comparatively adequately paid white-collar staff. (d) Part of a successful state Public Sector Undertaking (PSU) where employees were on fixed-term contracts, practicing 6-day working week and alternate Saturdays holidays. (e) Lean organization managerial resources focus on aggressive expansion, growth, volumes, and the HSE. (f) A young organization; with empowerment, challenges, and a growth environment. (g) Employee pride in creating new benchmarks of performance/speed of execution and outsourced development models across the industry.

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(h) The unlisted entity with significant debt because of the pace of project expansion. (i) In 2013, GSPC Gas by volume was 2.5 times that of GGCL. Source Compiled from GCL’s internal documents.

Annexure VII: Employee Rewards from the HR Perspective (a) All employees had permanent roles with high commitment or long-term liabilities for sustainability. (b) There were two separate operating workers’ unions in Surat, Ankleshwar, and Bharuch, with separate wage settlement agreements. (c) Blue-collar employees held strong opinions about the higher paid white-collar staff. (d) Enhanced pride in working in an MNC, leading to practicing a 5-day working week. (e) GGL was a publicly listed company with no debt. (f) Limited geographical area operations (Surat, Ankleshwar, and Bharuch) and limited personnel transfer stifled employee growth and made them complacent. (g) Proportionately high managerial resources with limited scope for professional growth. (h) As an older organization, a highly stable environment with less growth and challenges. (i) All operations, including most customer services, were managed internally since there were sufficient blue-collar, unionized employees in the workforce. Source Compiled from GGCL’s internal documents.

Annexure VIII: Grade Rationalization Grade rationalization and equitable R&R: summary of crucial observations.

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Source Compiled from GCL’s internal documents.

Annexure IX: Major Events During the Merger with GSPC

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Source Compiled from GCL’s internal documents.

Appendix: Teaching Note Case Summary Gujarat Gas Limited (GGL) is India’s most extensive city gas distribution (CGD) player. The company has been engaged in procuring and distributing natural gas since its establishment in 1980. The case talks about the journey of GGL, which, through several mergers and acquisitions, has achieved tremendous growth and success based on its strong culture, HR practices, and OD interventions. The company began as a joint venture, grew into a multinational organization, and then reversed its ownership to become a state-owned corporation. In all three phases, GGL has experimented with suitable HRD and OD interventions relevant to the different challenges at the time. During the third phase, Peeush Upadhyay, the EVP and CHRO of Gujarat Gas Ltd. (GGL), leads the way in maintaining company culture and employee satisfaction despite the challenges of the reverse merger. Nevertheless, a large company such as GGL must continuously stay ahead of new arising concerns. At the close of the case, they are at the threshold, grappling with critical issues such as top and middle management talent loss, succession planning, safety, compliance, and continuous skill development. As a CHRO of a large group, Peeush wonders, “What next move should I plan to resolve the current issues? What should I do to strengthen the culture and enhance the company’s growth?”.

Learning Objectives The case allows students/practicing executives/managers to study how a company continues to adapt across various challenges in a competitive business environment by emphasizing employee engagement, development, well-being, and alignment.

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Students can understand how the company goes through the mergers and acquisitions process and how it transforms the organization’s culture along with its growth journey. Students will also learn about the various HRD/OD interventions designed and implemented to enhance the company’s culture for improved future growth and success.

Case Positioning The case can be used in the class of organizational behavior, organizational culture, organization development, human resource development, employee relations, and mergers and acquisition course for the participants in MBA or executive MBA programs offered in top B-schools. This case can add value for HR professionals/ HR leaders and senior managers of large corporations/public sector companies. Moreover, CEOs/CXO enrolled themselves in short-duration executive education/ general management programs offered by B-schools to understand the merger and acquisition process and various HRD/OD interventions planned to strengthen the firm’s culture.

Teaching Plan Prerequisites This case should require 75–90 min of class time. The case can be introduced by emphasizing the role of employees in ensuring a business is successful through challenges and transformation. After going through the case, students should attempt the discussion questions in groups, with a reminder to incorporate previously learned OB, OD, and HRM concepts. The class should then come together to discuss and debate the responses they formulated within the group, with the teacher establishing a collaborative and open-minded setting. Additional texts could be emphasized for the topics of class interest. The case closing should emphasize the role of OB and HRM in supporting company evolution and reflecting business changes in organizational culture.

Discussion Questions How did the GGL organizational culture evolve? Describe the various phases and their impact on culture. Culture is an essential aspect of any organization. Kotter (2008) defines culture as the shared values of a group, even when individual members change. It needs to be addressed or it may become a secondary issue for the company. Ignoring culture is a mistake because culture positively and negatively impacts a company’s performance, reputation, and brand value. If the organization’s culture is appropriately

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managed, it may assist in achieving transformation and building organizations that will flourish even in the most challenging situations. Additionally, well-managed organizations can experience high growth, success, enhanced brand value, employee loyalty, and customer satisfaction. If the culture is managed poorly, the company has to handle high employee turnover, losing customer base to competitors, and lower brand value. Therefore, culture is made on repetitive practices, habits, and emotional responses. It is constantly renewing and evolving at a steady pace. As explained by Kotter, organizational culture is different from strategy or purpose, and some aspects may be more resistant to change than others. In this case, the culture of the GGL has evolved gradually. The company has gone through several mergers and acquisitions and its challenges. HRD and OD practices have been crucial in shaping the organization’s culture. During phase I, the early 1990s, GGCL (a former name of GGL) was incorporated as a joint venture gas company, GIIC, and Mafatlal group. The company was growing rapidly with a focus on quality customer services, high safety standards, and marketing. During this time, the company adopted HR practices focused on experimentation, exploration, and innovation. These practices helped build a positive culture in which every employee was encouraged to experiment and commit mistakes, creating a culture of zero resistance integral to the new company. It enabled the environment to flourish under the leadership of dynamic top management. Then, the company adopted HRD and the total quality route using tools such as HRD audit, vision, customer satisfaction and employee satisfaction surveys, integrated talent management using performance management, and potential appraisal and reward systems (PPRDS). Overall, the phase I incidents explained that GGL culture has evolved in the form of learning, caring, purpose, results, authority, and safety. In phase II, after the acquisition of the British Gas Company, the GGCL (a former name of GGL) became a multinational corporation and was headed under the leadership of Mr. Edwin Bowles, CEO. This acquisition created a sense of insecurity among employees related to new management, new culture, job loss, and more. The company was grappling with many sensitive issues, and the employee union was also established at that time. The company’s primary focus shifted toward employee engagement, satisfaction, health and safety, customer service, leadership development, and performance management. The company adopted several HRD and OD interventions (such as the employee and customer satisfaction survey, golden handshake scheme, standard operating procedures (SOPs) for safety culture, people inclusion toward community and environment, and corporate social responsibility (CSR)) to rebuild employee trust and commitment and tried hard to win the faith of union in management. These HRD initiatives brought a cultural shift in the company, more toward employees’ caring, learning, and safety. They also positively impacted the performance and growth of employees during that time. In phase III, GGCL marked a stagnation in their volume and growth, and GSPC was doing well. In 2013, GSPC, through its subsidiary Gujarat Distribution Networks Ltd. (GDNL), acquired the stakes in GGCL from the BG Group. GGCL

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again became a state-owned organization. For 2 years, both companies continued to run as separate entities, and in 2015, the combined entity was listed as Gujarat Gas Limited (GGL). The reverse merger came up with its advantages and disadvantages. After being listed as a combined entity, GCL faced many challenges post-merger. GSPC employees were dissatisfied with the amalgamation, resulting in mistrust toward the organization. Top and middle management employees left the organization due to an unequal culture. GGL made new changes to its employment terms, which differed from the earlier practices used in GSPC and GGCL. Peeush Upadhyay, CHRO, with the support of the MD and senior management, changed agents, and HR team members successfully created a culture of equitable and fair single-layer identity for all employees of GGL. Streamlining the functional processes and systems already established in GGCL helped streamline the process in GGL while considering and implementing the decentralization of the function. It led to the proper organization structure, accountability, and authority across the levels of the organization. Parallelly, the focus was more on “Communication” across the organizations. The same was done at various levels, i.e., MD, ED, CEO, Head-HR and Admin., CFO, HoDs, GA/Functional Heads, and Line managers. This initiative helped communicate the proper business agenda to align the various stakeholders on the M&A process and the HR aspects of job security and culture enhancement, mitigating slight risk across the organization. These HRD initiatives brought a new shift in the firm’s culture, ensuring a sense of security, fairness, and trust. What was the primary goal of the HRD team across all the phases of HRD and OD interventions? GGL is an example of a unique organization that was previously a joint venture organization; then, it became a multinational organization, and then through a reverse merger, it became a state-owned organization. The organization’s culture in these three phases has been shaped through various HRD/OD interventions that have led to the growth and development of GGL. Cultural differences between companies can be a primary source of failure in mergers and acquisitions, yet cultural integration is sometimes ignored and often reactive (Loderofos & Boatend, 2006). Although in the case of GGL, the response could also be considered reactive, once cultural differences were identified as a concern, they were of utmost importance to the organization. The primary goal of the HRD team across all the phases of mergers and acquisitions is to provide quality customer services, uphold high safety standards, focus marketing, expand the business, target untapped areas, strengthen relationships with government and external stakeholders, be involved in CSR activities, and maintain employee engagement, employee satisfaction, health and safety, continuous skill development, leadership development, succession planning, and performance management.

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What was the focus of the HRD team across all phases? Was it talent retention, cultural integration, quality customer service, or expansion and growth? Companies usually merge to stimulate growth, achieve a competitive advantage, expand market share, or improve the supply chain. For GGL, the primary focus on providing quality customer services, health and safety, business growth and expansion, and employee satisfaction was common in all three phases. In the early 1990s, the company GGL was focused on the three pillars of experimentation, exploration, and innovation. At the time, employees were happy with the culture that encouraged them to experiment and invited them to present their ideas at the table. Therefore, there was little resistance to change, and employee satisfaction and talent retention are not the firm’s concerns. The firm’s primary objectives were marketing, business expansion, providing quality customer service, upholding high safety standards, reskilling talent, employee satisfaction, and performance management. In phase II, British gas acquired the 65.12% stake in the firm and became a private organization. Due to the establishment of an employee union, the company noticed a sense of insecurity among employees. Then, the primary concerns were employee engagement, employee satisfaction, trust, cultural integration, cultural realignment, health and safety, customer service, customer satisfaction, leadership development, and performance management. Therefore, HRD and OD initiatives were planned to realign culture to improve employee and customer satisfaction. Furthermore, the efforts were to rebuild employee trust, reskill employees, enhance performance, improve health and safety, enhance business, and strengthen relationships with government and external stakeholders and CSR activities. In phase III, the firm again became a state-owned organization through a reverse merger. After the reverse merger, the new combined entity noticed significant growth in the business and several opportunities to grab. However, employees were losing trust in management at the ground level, and many top management officials were leaving the organization. The HR team faced significant challenges from reverse mergers, such as structural redesign, compensation and grade pay, integration of HR systems, cultural alignment, leadership approaches, legal compliance, and talent retention. Therefore, the primary focus was integrating the two company cultures and bringing an equitable and fair single-layer identity for all employees. This involved amalgamation of cultures, building trust, maintaining transparency, and aligning roles and responsibilities. Also, realigning designations, HR policies, employee benefits, service conditions, and adaptive leadership. In light of recent challenges, what is a loophole in existing HRD practices? What further actions should indeed be taken to improve the culture? We look at the recent challenges of top management loss, succession planning, employee development, safety, and compliance. There is some loophole in the existing HRD practices. Existing HRD practices involve hiring on contract roles,

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learning opportunities, skill building, safety, and compliance. To improve the culture, GGLs should take the following steps: 1. 2. 3. 4. 5. 6. 7. 8. 9. 10. 11. 12.

Improve hiring and boarding practices. Prioritize health, well-being, and safety and create a happy workplace. Building an open communication channel. Highlight high performers. Focus on compliance, laws, and a fair evaluation system. Focus on compensation and employee benefits. Offer rewards and recognition for outstanding performance. Provide training and development opportunities. Manage employee performance. Connect employees to organizations’ vision and goals. Update HR/ERP system. Adapt innovation.

In the position of Upadhyay; how would you design HRD/OD interventions in today’s context to avoid top management loss? What will be your plan of action for organizational growth going forward? GGL’s management team and employees must think out of the box and develop unique HRD/OD strategies to reshape the organization’s culture and avoid top management loss. GGL should diagnose the issues closely, identify the root cause, and discover the proper solution. Based on the current circumstances, organizations should shift their focus to issues such as performance management, appraisal, skill development, career development, attrition, top talent retention, succession planning, trust, loyalty, transparency, and many more. Going forward, GGL should adopt the following HRD and OD interventions: 1. Keep your employees engaged and at constant learning. Find and allot new assignments, challenges, and roles in the company to keep them engaged. 2. Keep your upper management connected to every employee and team to reduce the communication gap. 3. Design L&D goals and focus on building their competencies, which involves developing behavioral and technical skills. 4. Offer opportunities for professional development and continuing education. 5. Invest in career growth opportunities to excel in their career. 6. Encourage flexibility in the workplace. 7. Maintain transparency in the system. 8. Focus on performance management and succession planning to secure future positions. 9. Offer perks, rewards, and recognition to maintain the motivation of employees. 10. Offer fair and equal compliance and pay.

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11. Focus on employee engagement activities to retain trust, commitment, and loyalty toward the organization. 12. Emphasis on health, safety, and well-being of employees.

How is HR the key to any successful merger and acquisition? What are the main parameters for human resources during a merger and acquisition? Mergers and acquisitions are common for all businesses to achieve a competitive advantage in uncertain global environments. It is a key used to achieve organizational objectives along with market potential. Mergers and acquisitions profoundly impact the employees of organizations that are likely to integrate into a single entity. Many mergers and acquisitions fail due to incompatible cultures, poor leadership styles, low motivation, critical talent loss, communication gaps, reduced trust, and ambiguity about long-term goals. HR is essential in identifying the root cause, discovering solutions, and acting as a mediator to resolve employee issues. HR manages all the crises and disputes that occur in an organization and acts as a loyal advisor to an organization’s employees and management, considering a merger and acquisition transaction. According to Schrader and Self (2003), cultural integration is an essential part of M&A strategy and should include a pre-merger assessment of cultural compatibility and a preliminary exploration of strategic alternatives. A flexible and comprehensible integration plan should not only respond to challenges in cultural integration but try to solve them preemptively. It is integral so that when the initial excitement of the merger dies and friction becomes apparent, a company is not scrambling to provide a safe and collaborative environment. Different stages of change management become essential depending on the combination or acculturation phase (Mark & Mirvis, 2011). The differentiating factors/parameters for HR during a merger and acquisition involve the following: 1. The amalgamation of cultures of both organizations. 2. They are identifying individual strengths to apply them across the unified organization. 3. Building trust among two employee sets, integrating them into one organization. 4. Aligning roles, responsibilities, designations, HR policies, employee benefits, and service conditions. 5. Leadership ensures visible problem-solving, transparency, and perception of fairness in dealing with HR from both companies, emotions, and insecurities. 6. Ensuring critical resources did not leave the organization for any reason.

Growth and Transformation of Gujarat Gas Limited—An OD and HRD …

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Preparation and Other Readings The following article could help students understand the case and refer to the preparation of the session: 1. Marks, M. L., Mirvis, P., & Ashkenas, R. (2017). Surviving M&A. Harvard Business Review. 2. Dunbar, J. K. (2014). The leaders who make M&A work. Harvard Business Review. 3. Ulrich, D. (1996). Human resource champions—The next agenda for adding value and delivering. Harvard Business Press. 4. Kotter, J. P. (2008). Corporate culture and performance. Simon and Schuster.

Other Relevant Readings for Faculty Members’ Reference Are as Follows Other relevant readings for faculty members are as follows: 1. Caldwell, R. (2001). Champions, adapters, consultants and synergists: the new change agents in HRM. Human Resource Management Journal, 11(3), 39–52. 2. Ulrich, D., & Beatty, D. (2001). From partners to players: Extending the HR playing field. HRM, 26 November. https://doi.org/10.1002/hrm.1020. 3. Blake, R. R., Mouton, J. S., Barnes, L. B., & Greiner, L. E. (1964). Breakthrough in organizational development. Harvard Business Review, 42(6), 133. 4. Brown, K. (2004). Human resource management in the public sector. Public Management Review, 6(3), 303–309. 5. Madasamy, V. (2017). Impact of organizational development interventions. International Journal of Human Resource Management and Research, 7, 1–6. https://doi.org/10.24247/ijhrmrdec20171. 6. Fernandez, S., & Rainey, H. G. (2006). Managing successful organizational change in the public sector. Public Administration Review, 66(2), 168–176. 7. Lodorfos, G., & Boateng, A. (2006). The role of culture in the merger and acquisition process: Evidence from the European chemical industry. Management Decision. 8. Schraeder, M., & Self, D. R. (2003). Enhancing the success of mergers and acquisitions: An organizational culture perspective. Management Decision. 9. Marks, M. L., & Mirvis, P. H. (2011). A framework for the human resources role in managing culture in mergers and acquisitions. Human Resource Management, 50(6), 859–877.

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References Business Line. (2013). BG Group completes stake sale in Gujarat Gas to GSPC. https://www.the hindubusinessline.com/companies/bg-group-completes-stake-sale-in-gujarat-gas-to-gspc/art icle23119958.ece Economic Times. (2012). Gujarat State Petroleum Corporation-BG Group to close deal for Gujarat Gas Company Limited soon. https://economictimes.indiatimes.com/industry/energy/ oil-gas/gujarat-state-petroleum-corporation-bg-group-to-close-deal-for-gujarat-gas-companylimited-soon/articleshow/14804497.cms?from=mdr Economic Times. (2021). Gujarat Gas Company Ltd. [Amalgmated]. https://economictimes.indiat imes.com/gujarat-gas-company-ltdamalgmated/infocompanyhistory/companyid-12094.cms Financial Express. (2002). Gujarat Gas Company. https://www.financialexpress.com/archive/guj arat-gas-company/36886/ Gujarat Gas Limited, Business Responsibility Report Financial Year (2016–17). https://www.guj aratgas.com/resources/downloads/business-responsibility-report.pdf Gujarat Gas Limited, Company website. https://www.gujaratgas.com/about-us/the-company/ Rediff News. (1998). SEBI okays British gas move to up stake in Gujarat Gas. https://www.rediff. com/business/1998/nov/12gas.htm Repsol, Forbes. https://www.forbes.com/companies/repsol/?sh=167409b17c2a Times of India. (2012). British Gas sells Gujarat Gas to GSPC for 2.4k cr. https://timesofindia. indiatimes.com/business/india-business/british-gas-sells-gujarat-gas-to-gspc-for-2-4k-cr/articl eshow/16663816.cms

PRADAN: A Journey of Continuing Relevance Smita Mohanty and Ajaya K. Samal

1

The Formative Years

PRADAN (Professional Assistance for Development Action) was co-founded by Deep Joshi and Vijay Mahajan in 1983. Both had a basic education in engineering and were management graduates—Mahajan from the Indian Institute of Management (IIM), Ahmedabad, India and Joshi from Sloan School of Management, Massachusetts Institute of Technology, USA. Both were inspired by the idea that the best brains in the country need to devote their energies to addressing the most intractable problem of the country—endemic poverty. They set out to attract the brightest of the bright from IIMs and IITs, who would be willing to contribute to this cause in rural India. When it was difficult to attract people to rural development as a vocation, they chartered a course that set the trend for such initiatives to be undertaken in the years to come. PRADAN engaged and accessed the best external resource persons in the field. They include professionals such as Dr. Deepankar Roy, Fr. J. M. Fuster, Mr. N. R. Jain, Dr. Rolf P Lynton, Ms. Ronnie Lynton, Dr. Sanjiv Phansalkar, and Dr. Somnath Chattopadhyay. Some of these external resource persons were engaged on a sustained, long-term basis to foster and facilitate changes for making developmental interventions required in the organization from time to time. Initially, PRADAN began by offering its techno-managerial assistance (in keeping with its name) to existing Non-Governmental Organizations (NGOs) in

S. Mohanty (B) H2/18, Shiksha Appt, Plot 11, Sector 6, Vasundhara, Ghaziabad, UP 201012, India e-mail: [email protected] A. K. Samal A-22 (Second Floor), Sector 3, Gautam Buddha Nagar, Noida, UP 201301, India e-mail: [email protected] © The Author(s), under exclusive license to Springer Nature Singapore Pte Ltd. 2023 G. P. Mahapatra (ed.), Business Cases in Organisation Behaviour and HRM, Springer Business Cases, https://doi.org/10.1007/978-981-99-2031-0_3

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the country. PRADAN deputed its professionals to provide assistance to these organizations by helping them deliver services in the field. Soon, PRADAN began to seek opportunities to work directly in the field, to experiment and experience the translation of its ideas into reality. This ushered in a new phase of focus and growth for PRADAN. In 1987, PRADAN implemented its first direct project in two states, and by 1989, it stopped deputing its professionals to other organizations. Its young professionals (PRADANites), recruited from premier institutes of India, began to identify and grapple with the issues confronting the poorest of the poor in the country. The number of professionals in different years is provided in Annexure 1.

1.1

Induction of Young Professionals

PRADAN recognized that its primary, if not only, asset was its people. In the first year, it recruited four professionals. However, bringing in professionals in ones and twos was too little and too slow to make a significant difference to the work PRADAN set out to accomplish. A decision was then taken to induct around 100 young professionals every year from various disciplines. The intention was to not only have professional staff to implement programmes and projects but also to create a cadre of educated youth that would serve the cause of alleviating poverty in India. Consequently, PRADAN, in collaboration with external experts in recruitment and selection, set up a system of selection, which enhanced its capacity to select 100 young professionals annually. Around 60 PRADAN executives with more than 4 years of experience were trained to become recruiters and selectors. A pair of selectors carry out the selection process, either at a university/institute campus or a recruitment camp, with the mandate to finalize the selection. Senior members within the selectors only intervene or cross-check the selection. The process enhanced PRADAN’s efficiency vastly in selecting fresh professionals. This process has stabilized within the organization, and many NGOs in India have adopted similar processes to augment their professional staff.

1.2

The Structure

From its inception, the founders of PRADAN, in their wisdom, worked out a structure (Annexure 2) that was completely aligned with the vision and the ‘tasks’ that PRADAN had set out for itself. Professionals at the project implementation level were called executives. Those who oversaw the work of a team comprising 3–5 executives were called team leaders (now called team coordinators). The professionals responsible for programmes in a state were called programme directors (now, integrators). The staff that assisted the professionals were called assistants (now, associates). One among the integrators becomes the Executive Director (ED)

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41

for a term of 5 years. After completing their term, they return to being an integrator, shouldering a portfolio that needs a person’s energies with their perspective and experience. A Management Unit (MU), comprising select representatives from operations and integrating functions such as finance and human resource management, anchors the functioning of PRADAN. The ED, with some of the integrators, comprises the management unit, which is the apex decision-making body of PRADAN. PRADAN’s governing board comprises eminent professionals from different spheres of public life, including academia, industry, and the development sector. They provide oversight and guidance and carry out their fiduciary responsibilities. PRADAN’s salary structure is a running scale. In other words, each individual draws a salary on the basis of their number of years in PRADAN plus prior experience, if any. The pay is not determined by the position the employee holds. Every PRADANite receives an annual increment. This scale usually undergoes revision once every 3 years, based on a survey, considering the cost of living, etc. An internal committee approves a proposal and places it before the governing board. With this salary structure in place from the beginning, PRADAN steered clear of many of the usual ‘hygiene’ factors (such as changes in salary accompanied by promotions and fixing different basic pay for other people with the same number of years of experience), issues that most organizations face, particularly during periods of growth and expansion.

1.3

PRADAN’s Processes

PRADAN practices a democratic ethos. It strives for congruence between what it attempts to facilitate in the field and how it functions internally. For instance, one of PRADAN’s primary modes of functioning is through groups. After many deliberations, PRADAN defined its intervention unit as the Self-Help Groups (SHGs), comprising 14–18 rural women. PRADAN’s executives facilitate the processes of consensual decision-making in these SHGs. Analogously, PRADAN’s internal functioning is predominantly in groups, and consensual decision-making is the norm. This aspect of group-based, consensual decision-making is put into practice starting with the selection of fresh professionals to the team coordinators, integrators, and the ED. Sociometry, a group-based assessment process, is a component of all selection processes in PRADAN. Sociometry involves a relevant cohort of colleagues expressing their views about a candidate’s suitability for a position in PRADAN. A list of eligible candidates, usually based on the criterion of the number of years of experience, is drawn up. All colleagues, who know the candidate’s domain of operations and performance, express their opinion confidentially; these opinions are then pooled. The candidates, who score the highest, are shortlisted and rank-ordered for eventual selection. This and similar processes uphold the

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idea that PRADAN is everybody’s PRADAN. There is no one person who ‘owns’ PRADAN. PRADAN has a retirement age of 60 years. PRADANites (including the founders), who attain the age of superannuation, retire from the organization.

1.4

Annual Retreats

Furthering the participative culture of PRADAN and being a self-reflective organization, the entire professionals of PRADAN congregate at an annual retreat, during which PRADANites take time to pause, reflect, and renew. The year that has gone by is reviewed, theme(s) for the ensuing year are articulated, and PRADANites spend time getting to know each other better—their struggles, aspirations, and hopes for the future.

1.5

Challenges Faced at This Stage

Attracting educated youth to rural development was a challenge. Often, the parents of young executives need to be reassured of the organization’s credibility, the nature of work, and the contribution their children would be making. In the initial years, providing handholding and mentoring support to young professionals did not come easy because PRADAN itself was quite ‘young’ and could barely claim to have senior mentors to handhold the new recruits working alone in remote areas. Another area that required attention was stabilizing the systems and processes in Human Resource Management (HRM) and finance, critical for the integrating role in the growth of any organization.

2

The Growth and Expansion Years

By 2007, PRADAN’s operations were well established in seven states: Bihar, Chhattisgarh, Jharkhand, Madhya Pradesh, Odisha, Rajasthan, and West Bengal. PRADAN worked with marginalized communities, 65% of which belong to the Scheduled Castes and the Scheduled Tribes (perhaps the most vulnerable communities in India). Over a period of years, its work spread across 9,000 villages through block-level teams. Gradually, PRADAN came to be recognized by the government (including being involved in the government’s budgetary planning) and various other agencies in the sector. Donors were keen to provide funding support, better to leverage their funds to serve the poor. PRADAN continued to invest in the development of its staff. New recruits were called Development Apprentices (DAs), and a year-long development apprenticeship called the DAship programme was designed and launched for them. The DAship programme required DAs to spend several months in villages wherein

PRADAN: A Journey of Continuing Relevance

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they familiarized themselves with the community, village life, and developmental tasks. They explored the inner calling that helped them make an informed choice about their vocation. As DAs, they were exposed to ideas, concepts, and areas of development. They honed their skills to produce meaningful development outcomes. On completing the DAship programme, DAs emerged as well-rounded development professionals with the knowledge, skills, and orientation to work with the rural poor. Along with the executives, they spearhead PRADAN’s efforts in the districts and villages of the seven states. A three-phased Mentor Development (MD) programme was also launched. Almost all senior and experienced professionals underwent this MD programme. The mentors played a pivotal role in helping young professionals find their moorings in the field and PRADAN. They were helped to assimilate the ethos and practices of working with the rural poor. The MD programme honed the attitudes and skills necessary in a helping relationship; this involved focusing on the other person’s agenda and being empathic with the DA. In addition, mentors were equipped with skills in designing field assignments and providing written feedback to the DAs.

2.1

Re-Visiting PRADAN’s Vision

In 2013, PRADAN re-visited its vision. The revised vision envisaged the creation of a just and equitable society based on transforming the human condition. Bringing about and sustaining such a change required deliberate attention to society’s beliefs, values, norms, and practices. PRADAN visualized the state of the field as capable women’s groups able to articulate their overarching purpose(s) and move towards fulfilling their needs, aspirations, and goals. Such a group has an enhanced sense of agency. It gathered data, reflected upon its functioning and performance, and changed relevant practices. The SHG women engaged critically (to seek, process, and evaluate information) with the external environment and were able to act proactively (to anticipate and act) on issues of importance. They endeavoured to include the marginalized and excluded members of the community. They also stimulated, promoted, and nurtured similar groups and were able to influence the larger community. (For a more detailed understanding of some of the building blocks of change, please see Annexure 3.)

2.2

Partnerships and the Non-direct Approach

PRADAN recognized that it could only translate this vision into reality with the active collaboration of partner NGOs and other significant players in the field. It chose to call this a ‘non-direct’ rather than an ‘indirect’ approach to enhancing its outreach and continuing its journey towards more significant impact and relevance

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in the rural development space. Through its partnership with other civil society organizations, PRADAN reached out to an additional two hundred thousand households.

2.3

PRADAN’s Internal Structures of Governance

As PRADAN went about designing an appropriate structure and a set of processes in the light of this new approach, it thought it is important to mirror internally what it wanted to see out there. Along with the effort to establish democratic structures and processes in the field, therefore, PRADAN evolved its own internal governance structures and processes. ‘General Council’ (GC), the internal governance structure, emerged. PRADANites with 4 or more years of experience were offered membership of the GC. Membership to the GC was voluntary. The GC is accountable to the community of PRADAN. It is responsible for giving life to the mission of PRADAN; for reviewing and revising it; for upholding the non-negotiables (a set of values and a ‘code of conduct’); for reinforcing the empowering means of influencing, including processes of leadership and decisionmaking; for establishing PRADAN’s credibility in the development fraternity; for mapping the state of the health of financial, human, and knowledge resources; for reviewing and reinforcing professional practice, such as setting standards, self-reviewing, cost consciousness, and bringing innovations; for reviewing and identifying areas for policy formulation; for ensuring continuity; for renewing the SC and leadership positions; and for encouraging cross-fertilization and mutual learning.

2.4

Challenges Faced at This Stage

PRADAN, to raise the scale of its impact, gradually morphed into a projectdelivery organization. At this stage, it faced the challenge of changing the approach of PRADANites—to re-orient them to an approach that was still seeking, predominantly, to focus on the sense of agency of groups and collectives. PRADAN also faced a funds crunch. Development Support Cost (DSC) for staff salaries and administrative expenses is difficult to come by in the best of times. Donors are willing to pay for project implementation but are extremely reluctant to fund DSC. This had to be raised from philanthropies. One of the large donors that supported almost 40% of DSC withdrew their commitment. They found it difficult to justify funding the same organization beyond three cycles (lasting 4 years each). The corpus of the organization needed to be buttressed to provide for DSC. The third issue was that an increasing number of experienced professionals faced a sense of stagnation. As PRADAN matured, there were nearly 80 professionals with 10 years or more of experience. Finding significant and meaningful engagement for them was becoming a concern.

PRADAN: A Journey of Continuing Relevance

3

The Maturing Years

3.1

Change in Focus—Long Term to Short Term

45

As PRADAN drew closer to becoming a 40-year-old organization, and was faced with the challenges it was encountering, it let go of the idea of changing its approach. Funds took much work to mobilize. In discharging its Corporate Social Responsibility (CSR), the private sector had a short-term perspective. Development had to be done in a hurry. PRADAN deployed small teams of professionals to implement these CSR projects.

3.2

Change in the Nature of SHGs

One of PRADAN’s primary building blocks for development, the SHG, underwent a change. The government and the state recognized that mobilizing women’s groups was essential for development efforts to bear fruit. The entry of the National Rural Livelihoods Mission (NRLM), a government flagship programme, and, subsequently, the State Rural Livelihood Missions (SRLMs), with a monetary incentive attached to the formation of groups, began to erode PRADAN’s mainstay of mobilizing, establishing, and facilitating robust SHGs of women. PRADANfacilitated SHGs, in addition to stimulating women to work towards sustainable livelihoods, focused on various other aspects such as gender, rights, and entitlements. PRADAN had to adapt itself quickly to the new reality. It began to carry out its programmes and projects using the SRLM-created SHGs. PRADAN facilitated the emergence of 65,000 SHGs and has touched nearly a million households.

3.3

Burgeoning Costs

By 2017, about 150 professionals had 5 or more years of experience; as mentioned, about 80 had more than 10 years of experience. With such experienced professionals, PRADAN needed to expand or deepen its work significantly so that the professionals could handle meaningful chunks of work. However, PRADAN fell reasonably short of creating such workspaces for its professionals. Consequently, many of them began to experience a sense of stagnation. PRADAN explored the possibility of its experienced professionals becoming development entrepreneurs and starting something of their own, with hand-holding support from PRADAN. However, the entrepreneurial bug is not very widely distributed. As a result, only some professionals ventured to set something up on their own. PRADAN supported those who did to set up their own NGOs. This has been one of PRADAN’s significant contributions to the development sector. These NGOs essentially adopted PRADAN’s values, norms, and practices. In this sense, PRADAN has contributed to the spread of a value-based development ecosystem in the country.

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S. Mohanty and A. K. Samal

Shift in the Nature of Funding

As mentioned earlier, some donors, who had supported PRADAN over many funding cycles, needed help to justify their investment in PRADAN. They were looking to spread their portfolio to enhance their reach and support the growth and development of more NGOs. PRADAN found their funding sources drying up from donors, who had been PRADAN’s mainstay for long periods. PRADAN began to access government funding through projects. These funds came with their own protocols. PRADAN lost some flexibility regarding how it could deploy these funds and carry out the projects contracted.

3.5

Challenges Faced at This Stage

A big challenge that PRADAN faced was the change in the nature of the development task—from gradual, long-term, programmatic engagement to quick, short-term, project-based engagement coupled with a change in the sources and the nature of funding. In addition, it was an increasing number of experienced professionals facing a sense of stagnation. Thus, this has been PRADAN’s journey for almost four decades of its existence—a journey of continuing relevance. From a unique idea of harnessing the imagination and energies of educated youth for the nation’s development to evolving into an institution that sets standards and norms of development practice for all in the development sector to emulate, PRADAN has paved the path for others in the field.

4

Proposal to PRADAN’s Members of the Governing Board

PRADAN has weathered many a storm in the past—from doubters of the idea to nay-sayers who thought harnessing professional resources for rural development was impossible. New emerging realities necessitate PRADAN to pay attention to and reflect on the options it wishes to choose for itself in the future. One particular area worth exploring may be the nature of engagement with the development task. Although it goes without saying that development is a longterm undertaking, PRADAN may need to explore the possibility of shorter term engagements and develop innovative ways of bringing about change in a relatively short span of time. Another area of attention is leveraging the pool of senior professionals. PRADAN needs to engage actively with its large collection of experienced professionals to figure out how their energies can be best tapped and utilized—for their own growth and for furthering the development agenda. How can PRADAN build collaborative partnerships? The answer may lie in seeking, establishing, and nurturing collaborative partnerships with other field civil

PRADAN: A Journey of Continuing Relevance

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society organizations and development agencies. This will help leverage the professional, technical, and financial resources that may be melded in a synergistic manner to produce significant development outcomes. PRADAN may need to encourage the emergence of multiple PRADANs instead of one unified PRADAN and support these new organizations. This may contribute to the organization’s ability to take on an array of assignments and make implementation faster—an attractive proposition for people in the corporate space and other actors in the field. PRADAN can move beyond the country’s borders. Over the years, PRADAN has garnered enough expertise and credibility to be able to ‘export’ its ‘brand’ of development to countries beyond our borders. This will help spread PRADAN’s development perspective and provide meaningful engagement to the band of highly experienced PRADANites. PRADAN must aggressively expand its donor base and not limit itself to ‘big’ donors. It needs to tap into smaller donors as well. Some of these ideas may require legal as well as financial restructuring. Nonetheless, exploratory actions need to be initiated. The current management unit is wondering where PRADAN will transcend for its continuing relevance. Which is the correct path or paths out of these multiple options before it that will make it sustain without changing its character entirely?

Annexure 1 Growth of professional human resources over the last 20 years Timelines

Number of professionals with experience level Up to 4 years

4 to 9 years

9 to 14 years

14 to 19 years

March 1986

25

March 1990

46

3

March 1995

43

44

2

March 2000a

57

17

8

3

March 2005

No. of DA 19 and above

Total

25

Total (cumulative figure since beginning) 0

49

4

89

40

0

85

297

93

44

13

6

2

158

701

March 2010 174

46

32

8

6

266

1350

March 2015 174

117

23

25

12

351

1919

March 2020 128

136

75

32

32

388

2364

a 1998

PRADAN South split and DHAN Foundation was born, more than 100 staff went there

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Annexure 2: The Structure of the Organization

Governing Board Executive Director Management Unit Integrator Team Coordinator Executive Associate

Annexure 3: Change: Some Building Blocks In an endeavour to strategize and intervene in the current situation, PRADAN decided to conceptualize and articulate the meaning of change and some of its building blocks.

Driven from Within To have the power to propel and sustain itself, change had to be anchored within the community and the individual. In other words, it needed to be internally driven. Manifest behaviour (B) is a function of the perception of self (P) in interaction with the perception of the environment (E). Thus, change required one’s own perception of self and the environment, which is internal. The whole field, or ‘life-space’, within which people act was to be considered; this included the social field (family, work, school, and church), psychological field (needs, aspirations, etc.), and sociological field (force fields—motives clearly being dependent on group pressure). B is a result as well as an input to the next spiral of change because a change in B would contribute to a change in P and E.

The Sense of Agency The human condition is determined by a complex interplay of psychological, physical, and spiritual forces. The key determinant, or pivot, in this process is a community’s/group’s/person’s sense of agency (‘I matter’). Enhancement in the sense of agency is, perhaps, the most critical ingredient to trigger and sustain change in the human condition and provide a sense of well-being. The sense of self-efficacy is a significant force. A person with low self-efficacy will harbour feelings of hopelessness such as what one often encounters among

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members of the poorest social groups in India. It follows that enhancing the sense of agency of poor people must be a necessary and key element in the strategies used to alleviate poverty. This can, perhaps, best be done by engaging directly with them as individuals, in groups, and in communities. To succeed, such an engagement must be rooted in the belief, a priori, that people have the capability, that they are worthy and can be the drivers of change for themselves.

Collectives and Groups Any change, no matter how microcosmic, has to ground itself and find roots in the macro-fabric of the community. Collectives and groups are the receptacles of the macro-fabric. Therefore, collectives and groups need to be the primary focus of a change intervention because (a) collectives and groups are where ‘culture’ manifests itself; (b) collectives and groups bring and bind people together through an ‘interdependence of fate’ as well as an ‘interdependence of task’—the task of building a better life for the entire community; and (c) it is predominantly through collectives and groups that a ‘movement’ can be orchestrated. The primary group is the connecting link with the larger community. These groups from within the community are more aware and conscious of the reality of the poor and the marginalized—their poverty and their oppression. Inclusive processes ensure that people come together and develop a bond on the basis of an ‘interdependence of fate’. Collectively, they explore what they can do for themselves. This often results in raising the level of consciousness about their own strength and what they can do to change their condition. In the safety of the primary group, usually of about 15 members, people learn to share their experiences, their pain and joys, their despair and hope, and find succour, support, and encouragement to deal with their reality. They engage in member development and help individuals find their voice, participate more effectively, and evolve into aware and conscious citizens. In the primary group, members get an opportunity to experience their potential for change, growth, and development. PRADAN’s primary unit of engagement was envisaged to be such groups (one form of which is the SHG). These groups were facilitated to focus on what they have, rather than on what they do not have. In recognizing these assets lies their strength, energy, and potential to stimulate and propel change and improvement. Some of the existing values, virtues, practices, and norms, which pertain to collectives, groups, and nature, may need exploration, legitimization, and reinforcement. “What I do have is not inferior and, hence, is not to be discarded; it is to be valued and put to better use.” Such exploration could become the springboard for action and betterment. Democracy and democratic functioning are often the casualty in our society. To quote Kurt Lewin, “… democracy must be learned anew in each generation, and that it is a far more difficult form of social structure to attain and to maintain than is autocracy.” Norms and practices upholding the values of equality, equity, and

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S. Mohanty and A. K. Samal

fairness need regular attention and reinforcement, to establish democratic functioning as a way of life. Facilitating groups to examine, explore, reinforce, and adopt processes and practices of democratic functioning such as distributive leadership and consensual decision-making are critical. These ensure that collectives, groups, and people in the community can experience the freedom to exercise their right and choices and bring about change in their self-view. As these groups matured to take on issues that confront the community, they organized themselves into clusters and federations. PRADAN did not form all the groups. When people experienced the potential and the power to bring about change in their community’s life, SHGs, clusters, and federations took on the task of stimulating and forming more groups—creating a wave of change around them.

Engaging with Relevant Stakeholders The environment poor people have inhabited over centuries clearly fosters and sustains poverty. Pervasive inequalities constrain the capacities of people to organize and claim their space as citizens. Although formal rights have been endowed, citizens still find it difficult to overcome structural inequalities to act on their rights effectively. Together, the horizontal problem of pernicious social inequality (gender, caste, class, ethnicity, spatial—which undermines the ability to act on rights and what is mandated) and the vertical problem of state-society relations (characterized by patronage and dependence and limited to electoral roles) are recognized as essential challenges to make government accountable. ‘Horizontal’ refers to ‘associational life’. While formal rights exist, inequalities between social categories (gender, caste, ethnicity, and class) limit the abilities of these social categories to demand their rights and the mandated benefits from the state effectively. This distorts the playing field and there is wide-ranging exclusion. Citizens need to recognize themselves and each other as rights-bearing citizens. They also need to engage with the state, beyond voting and punishing the incumbents for non-performance the next time around. ‘Vertical’ refers to weak institutionalization, in particular, poor integration between the state and the citizen. (a) How do citizens engage with the state? Statesociety relations are dominated by patronage and populism, with citizens having no effective means of holding the government accountable (except during elections) or reducing their status of being dependent clients. In the absence of clear and rule-bound procedures of engagement, citizens cannot engage with the local government. (b) Citizens can barely engage with the state, given that the local government is absent in poorly governed areas, or just weak (low will to work and ‘rent-seeking’); there are, therefore, very few points of contact with the local citizens. A significant step in redressing the above situation is the space for community dialogue, discussion, and action in local governance institutions. Amartya

PRADAN: A Journey of Continuing Relevance

51

Sen (2000), with other theorists of participatory democracy, has argued this case eloquently. Two key ideas here are (a) We must not just have democracy; we must also practice democracy. (b) Democracy is, first and foremost, about how preferences are formed. And the key to this has to do with the quality and inclusiveness of public discussion. As women’s SHGs, clusters, and federations discuss matters and take these discussions into the public space and engage directly with relevant local actors (the local government, the forest department, the police, panchayats, gram sabhas, etc.), they ensure that they have a say in matters that pertain to them as they ‘get their work done’. More critical, perhaps, is the change in the norms and values that they bring to the overall fabric of political and social life. PRADAN wanted to see community collectives as the centre of the harbingers of change. The other actors, including PRADAN, were arrayed around these collectives, in order to provide support and strengthen their actions. The imagery is that of the Oceanic Circles as expounded by Mahatma Gandhi: Independence begins at the bottom… It follows, therefore, that every village has to be self-sustained and capable of managing its own affairs… It will be trained and prepared to perish in the attempt to defend itself against any onslaught from without… This does not exclude dependence on and willing help from neighbours or from the world. It will be a free and voluntary play of mutual forces… In this structure composed of innumerable villages, there will be ever-widening, never ascending circles. Life will not be a pyramid with the apex sustained by the bottom. But it will be an oceanic circle whose centre will be the individual. Therefore, the outermost circumference will not wield power to crush the inner circle but will give strength to all within and derive its own strength from it.

Appendix: Teaching Notes Case Summary This case study traces the history of Professional Assistance for Development Action (PRADAN). PRADAN’s seminal idea is to attract and inspire educated youth to contribute to the development of India. PRADAN’s founders, Vijay Mahajan and Deep Joshi, believed that the brightest minds must apply themselves to the country’s most intractable problem—endemic poverty. From its beginnings in 1983, PRADAN has grown into a 500-strong organization of university-educated professionals reaching out to over a million families in India’s poverty-stricken, rural hinterlands. Over the years, PRADAN has helped nearly 4,000 professionals identify and explore their inner calling and make rural development a vocation of their choice. PRADAN works through Self-Help Groups (SHGs) of women that it organizes and mobilizes. Facilitating and helping these women establish livelihood activities

52

S. Mohanty and A. K. Samal

enhance their economic status and foster a greater sense of well-being. So far, PRADAN has supported the emergence of more than 82,000 SHGs in India. This case study has been divided into the formative years; the growth and expansion years, and the maturing years. Each section describes the nature of the organization’s investment and energy mobilization and the challenges faced.

Learning Objectives This case study is developed to inspire a reader to draw insights from PRADAN’s journey. What may stand out is that any journey, even of an illustrious organization, has its ups and downs, and some challenges must be confronted. The reader may ponder over the ability of an organization to be proactive in anticipating the challenges it is likely to face in the future and its ability to adapt to ever-changing times to keep itself relevant and alive.

The Target Audience A diverse audience may find it helpful to enter into deliberations on this longitudinal case study. This may include ● ● ● ● ● ● ● ●

Development policymakers. Donors and other financial institutions. Personnel of NGOs. Personnel from civil society organizations. Programme/Project planners and implementers. Rural development executives. Students studying development practice and management. Can also be used in OSD courses for BM and HRM students other than development and RM students. ● Any other stakeholder interested in development and development organizations.

PRADAN: A Journey of Continuing Relevance

53

Case Questions and Suggested Timeframe The initiation of the discussion may be as open-ended as “What do you see in this case?” As participants contribute, the teacher may catalogue these on the whiteboard. After that, the teacher may categorize these issues into organization structure, funding strategy, change and its ramifications, and any other relevant category. Hereafter, the teacher has at least two options: S/he can ● Open the discussion to the entire class, focusing on one category at a time. ● Divide the class into sub-groups, with each sub-group working on one category. Whichever way the teacher decides to operate, s/he would need to allocate a significant length of time for this segment of the process. Because this case has yet to be test-taught, it is difficult to suggest a duration for this part; however, at least an hour, to begin with, may be allocated for discussion in small groups. Through these small group discussions it may be appropriate to collect the ideas of the participants into the following categories: ● Diagnosis and identification of problem(s). ● Possible alternative solution(s). ● The group’s recommendation(s). The total time for the session may be 2 hours.

Case-Wise Analysis/Responses by Authors Along with Relevant References Traditionally, organizational life cycle (OLC) research has focused on for-profit organizations. Life cycle stages provide a diagnostic tool that enables organizational leadership to anticipate challenges and navigate transitions. Though the characterization of the stages defined in the conceptual models of OLC is more for private sector organizations and might not apply directly to non-profit organizations, they also have distinctive characteristics. A pioneer in the field of development management, Lewis (2006, pp: 1) suggests that their management is a “specialised field that warrants its own text because it requires new creative thinking that goes beyond existing mainstream business management or public sector administration science.” There are other researchers Brown & Korten (1989), Lewis & Kanji, (2020), Mahajan, (1998, 2018), Srivastava & Rajesh (2005), Tandon, (1991) whose research has shown that non-profits have distinctive characteristics and face particular sets of challenges at different stages of their life.

54

S. Mohanty and A. K. Samal

Additional Questions The other pertinent questions that can be asked are – Where will PRADAN transcend for its continuing relevance? – Which is the correct path out of the multiple options that will make it sustain without changing its character entirely? – What would be the role of the change management team in making the transition take place?

Additional References – The readers could also read Dr. John Kotter’s ‘The 8-Step Process for Leading Change’. The 8-Step Process for Leading Change is an award-winning strategy by Kotter from Leading Change and has transformed countless organizations. https://www.kotterinc.com/methodology/8-steps/ – The readers could also refer to different ‘Organization Life Cycle’ theories (https://www.product-arts.com/attachments/article/1246/Company_EvolutionThe_Organizational_Lifecycle.pdf), as these could provide them with diagnostic tools to understand the current stage of the organization in question, in this particular case. This may also give them the wherewithal to propose the next steps and direction the organization needs to take to sustain itself and have continuing relevance.

References Brown, D., & Korten, D. (1989). Understanding voluntary organizations. World Bank Working Paper WPS, 258 Kotter, J., Heart of change. Harvard Business School Publishing. Lewis, D. (2006). The management of non-governmental development organizationsRoutledge. https://www.semanticscholar.org/paper/Non-Governmental-Organizations-and-DevelopmentLewis-Kanji/7a7e3a5efada0225e62003ed2ee588ba141a30df Lewis, D., Kanji, N., & Themudo, N. S. (2020). Non-governmental organizations and developmentRoutledge. Mahajan, V. (1998). Voluntary action in India: A retrospective and speculations for the 21st Century. Sir Ratan Tata Trust Annual Report, 199.9 Mahajan, V. (2018). A retrospective overview of social action in India: 1817–2017. Srivastava, S. S., & Tandon, R. (2005). How large is India’s non-profit sector?. Economic an PoliticalWeekly, 1948–1952. Srivastava and Rajesh (2005) Published by: Economic and Political Weekly, 40(19), May 7–13. https://www.jstor.org/stable/4416603 Tandon, R. (1991). Civil society, the state, and roles of NGOs (Vol. 8). Institute for Develoent Research.

Plantation of Hope: The Turnaround of Harissons Malayalam Ltd. Manoranjan Dhal and Surya Prakash Pati

Mr. Sachin Nandgaonkar, President and Sector Head of RPG Enterprises, sipped tea while planning for the annual board meeting. Although he loves tea, it is his business as well. Sachin is the Sector Head of the cables, plantation, and life sciences businesses of the organization. While the electrical and life sciences division operates smoothly, the plantation business, which runs under the aegis of Harrisons Malayalam Limited (HML), is a matter of worry. HML is recognized among India’s best companies to work for in 2020 and has secured fourth rank among India’s traditional industries. Sachin is excited to see HML share honours with some of the country’s most reputed companies. It is a recognition of the hightrust culture prevalent in the firm. “However, why is HML not making money?” he asks himself aloud as he shifts through the financial statements.

This case is authored by Manoranjan Dhal and Surya Prakash Pati, members of faculty at Indian Institute of Management Kozhikode. It is intended to be used as the basis for the class room discussions rather than to illustrate either the effective or ineffective management situation. M. Dhal (B) Professor, Organizational Behaviour and Human Resource Management, Center for Employment Relations and Labour Studies, Indian Institute of Management Kozhikode, Kozhikode, Kerala, India e-mail: [email protected] S. P. Pati Associate Professor, Organizational Behaviour and Human Resource Management, Center for Employment Relations and Labour Studies, Indian Institute of Management Kozhikode, Kozhikode, Kerala, India © The Author(s), under exclusive license to Springer Nature Singapore Pte Ltd. 2023 G. P. Mahapatra (ed.), Business Cases in Organisation Behaviour and HRM, Springer Business Cases, https://doi.org/10.1007/978-981-99-2031-0_4

55

56

1

M. Dhal and S. P. Pati

HML: Company Background

Harrisons Malayalam Limited (HML) is the most successful integrated agricultural operation in South India. One of the oldest companies in the country with a history that goes back over a 150 years, it has been a pioneer in corporate farming. It produces tea, rubber, cocoa, coffee, pineapple, and various spices in farmlands that are spread across 14,000 hectares. The company also cultivates smaller quantities of a variety of other exotic horticultural crops, such as areca nut, banana, cardamom, coconut, and pepper. It also produces limited amounts of organic tea. The company’s operation is spread over 20 estates, 8 rubber factories, 12 tea factories, and several blending and processing units in the three southern states of Kerala, Karnataka, and Tamil Nadu. As a dominant player in tea exports from South India, HML is a significant source of quality teas for all the big names in the tea industry in Europe. HML exports to many countries, mainly the USA, the UK, Germany, the Netherlands, Spain, Russia, CIS countries, and the Middle East and Africa. The company is also an industry leader in natural rubber production and is known for its high-quality natural rubber in the local and export markets. The first tea plantation of HML began nearly 200 years ago when tea was first planted on the Western Ghats. Over the next 100 years, tea plantations became a significant activity transforming the landscape of these mountains. Their slopes turned into the manicured tea gardens we see today, providing employment and a reasonable standard of living to the local population. In the early 1900s, these estates underwent a consolidation exercise. In 1907, Harrisons & Crosfield, tea traders based out of Liverpool, bought and established Malayalam Plantations Ltd. The year 1984 witnessed Harrisons & Crossfield merging with Malayalam Plantations to Indian nationals while renaming the part they held as Harrisons Malayalam. Approximately 36 years ago, the changing interests of Harrisons & Crosfield made them divest from the plantation business to a large extent. As a result, the RPG Group, one of India’s prominent and well-respected business houses, acquired Harrisons Malayalam. The group is interested in tyres, cables, power transmission, telecommunications, pharmaceuticals, specialty chemicals, retail and consumer marketing, hotels, tourism, entertainment, and agri-business. Listed on the National, Bombay, and Cochin stock exchanges, HML has a paidup capital of INR.184.50 million and a shareholder base of approximately 33,000. It has a workforce of approximately 19,000 employees, of which 58% are women (see Exhibit 1 for details on workforce characteristics). However, its financials could be more encouraging (see Exhibit 2). The company had grown from INR 3665.5 million in 2010–11 to a mere INR 3934.3 million in 2019–20. At the same time, the labour cost increased during the same period by 58%, i.e., from INR 1045.9 million to INR 1648.1 million. Labour cost is the most noticeable cost in the plantation industry and the source of competitive advantage. The labour cost as a share of total income increased from 29% in 2010–11 to 42% in 2019–20. The profit before interest and taxes (PBIT) has remained negative for several years, which is a matter of concern for management.

Plantation of Hope: The Turnaround of Harissons Malayalam Ltd.

57

Despite these worrying numbers, HML continues to win the trust of its employees and the local community. It has undertaken many community development measures in education, environment, and health (see Exhibit 3). Operating in rural India, the company has brought economic activity to remote parts of this region and provided basic amenities, including health care, to a population otherwise deprived of such support. In a nutshell, it has not swayed away from its core values,1 which are ● ● ● ● ● ●

Customer sovereignty. People’s orientation. Innovation and entrepreneurship. Transparency and integrity. Anticipation, speed, and flexibility. Passion for superior performance.

HML has stood by the local community, be it the landslides in the tea estate or flood in the locality. The company actively engaged itself in the relief work of the flood victims in 2018, and along with the RPG group employees, the company created a charity fund of 10 million rupees, of which 50% was donated to the Chief Minister’s Relief Fund, and the other 50% was used for improving the infrastructure in the locality and paying compensation to the dependents of deceased community members. To better appreciate the challenges and contributions of HML, it will be wise to be acquainted with the tea industry in India.

2

The Indian Tea Industry

Tea is one of the three significant nonintoxicating beverages globally, the other two being coffee and cocoa. China prevailed as the sole tea exporter until the beginning of the nineteenth century. However, the country’s political fluctuations added to the accelerating uneasiness between the Chinese and the English traders. This made the East India Company (EIC) look for other tea-growing areas. India thus stepped into the tea map of the world. In 1774, a shipload of tea seeds was imported from China for an experimental plantation in Calcutta (currently known as Kolkata, West Bengal State, India). However, it was in 1793 that the EIC initiated tea cultivation in the private botanical garden of Colonel Robert Kyd in Shibpur, Calcutta.

2.1

Industry in Stress

However, the rich history of the industry could not help sustain its competitiveness. The 1990s were unfavourable to the tea industry in India. The dissolution of the USSR that loyally devoured huge volumes of Indian tea upset many trade calculations. When the market revived in the mid-1990s, Russians sought cheaper product options. The tea industry, especially in the South, reacted to such demand

16

% of Women (%)

7

0

43

0 62

1220

79

1030

77

2033

131

1872

28

2

Women

3253

210

2902

105

36

Total

Rubber

48

749

48

653

31

17

Men

682

94

578

9

1

Women

1431

142

1231

40

18

Total

Total

2005

127

1683

120

75

Men

2722

225

2450

38

9

Women

4727

352

4133

158

84

Total

58

64

59

24

11

% Women (%)

Note The table reflects the workers on the company payroll. The company also employs migrant workers (approximately 300–350 numbers)

36

Total

0

0

0

0

Worker

Temporary workers

13

34

6

1

24

12

Executive

Staff

30

Tea Men

Women

Total

Head office

Men

Exhibit 1 Diversity of the workforce in HML

58 M. Dhal and S. P. Pati

93.83

16.6

104.15

6.49

332.21

115.93

14.91

97.32

6.11

338.86

Raw materials and Purchases

Power and fuel

Cultivation and other operating expenses

Depreciation

–

10.45

5.25

PBT@

Total comprehensive income/(loss)

27.33

17.06

–

341.58

349.49

Cost of sales

PBIT@

9.37

10.63

Selling expenses

111.14

366.55

104.59

Total income

368.91

11-December

Personnel cost

Profit and loss account (in INR)

10-November

–

3.48

18.06

331.87

8.35

323.52

6.76

91.86

19.62

89.07

116.21

349.93

13-December

Exhibit 2 Financial performance of HML (All figures are in ten million)

–

4.86

19.96

366.9

8.85

358.05

6.47

99.81

20.43

107.44

123.9

386.86

13–14

–

−45.68

−35.26 –

320.33 −31.73

355.46

7.1

313.23

5.52

68.78

19.86

78.74

140.33

288.6

15–16

−21.3

10.24

345.22

7.29

89.3

21.31

94.31

133.01

334.36

14–15

0.49

4.09

17.78

357.84

8.66

349.18

5.01

60.08

20.27

118.86

144.96

372.02

16–17

1.33

4.45

16.83

378.33

10.58

367.75

4.16

73.88

22.3

115.01

152.4

392.04

17–18

0.36

−25.13

(continued)

9.28

24.73

368.7

10.84

357.86

4.3

72.36

21.95

94.44

164.81

393.43

19–20

−24.08

−10.56

370.46

10.46

360

4.16

68.01

20.67

114.9

152.27

359.9

18–19

Plantation of Hope: The Turnaround of Harissons Malayalam Ltd. 59

1.5

Dividend per share of 10/-

18.45

300.53

91.21

105.25

515.44

18.45

299.03

113.28

81.82

512.58

Share capital

Reserves and surplus

Loan funds

Other liabilities

Total liabilities

Source HML Annual Report (2019–20)

515.44

512.58

Total assets

0.21

88.56

0.01

87.05

Investments

426.67

425.52

1.5

2.55

11-December

Other assets

Fixed assets

Balance sheet (in ten million INR)

2.14

10-November

Earnings per share of 10/-

(continued)

530.09

128.49

81.94

301.21

18.45

530.09

96.82

0.21

433.06

0.75

1.24

13-December

541.22

114.18

105.13

303.46

18.45

541.22

109.41

0.21

431.6

1

2.38

13–14

513.08

128.48

97.94

268.21

18.45

513.08

83.29

0.21

429.58

501.11

165.98

94.16

222.52

18.45

501.11

76.36

0.16

424.59

Nil

−24.75

−19.18 Nil

15–16

14–15

360.89

171.81

86.63

84

18.45

360.89

75.74

0.16

284.99

Nil

2.22

16–17

380.64

190.39

86.47

85.33

18.45

380.65

92.51

0.16

287.98

Nil

2.41

17–18

373.06

173.35

121.06

60.2

18.45

373.06

83.25

0.16

289.65

Nil

−13.05

18–19

403.29

210.51

113.77

60.56

18.45

403.29

105.51

0.16

297.62

Nil

5.03

19–20

60 M. Dhal and S. P. Pati

Plantation of Hope: The Turnaround of Harissons Malayalam Ltd.

61

Exhibit 3 Summary of CSR activities by HML S. no

CSR themes

Activity

Locations

1

Education

Rakshita—Centre for Children and Young Adults with Special Needs

Arrapetta, Wayanad

No. of beneficiaries

2

Education

Safety and first aid awareness

Estates in Wayanad, Thrissur, Idukki, Pathanamthitta, Kollam and Nilgiris District, Kumbazha, Nagamallay, Wallardie, Moongalaar, Pattumalay, Kundai, and Mooply

1448

3

Education

Summer camp

All Estates in Wayanad, Thrissur, Idukki, Pathanamthitta, Kollam, and Nilgiris district

600

4

Education

Training and Awareness Wallardie, Moongalaar, Programme Wentworth, Mooply, and Kundai Estates

508

5

Education

Competition for children conducted on Independence Day

Mooply and Kundai

6

Education

Employee Empowerment and Training Programme

Staff Club Cheramadi and Goldsland creche

7

Education

Award to meritorious students

Kumbazha Estate

8

Education

Education kits

Surianalle (Idukki), Lahai (Pathanamthitta) and Mayfield (Nilgiris), and Bhagavathy Vilasam Higher Secondary School at Narayambalam, Ernakulam

230

9

Environment

World Environment Day celebrations

All estates in Wayanad, Thrissur, Idukki, Pathanamthitta, Kollam and Nilgiris district, Moopy Kundai, Moongalaar, Wallardie Estates, and Cherambadi Panchayat

1428

20

36

148

26

(continued)

62

M. Dhal and S. P. Pati

(continued) S. no

CSR themes

Activity

Locations

10

Environment

Waste management with the help of local self-government bodies

All Estates in Wayanad, Thrissur, Idukki, Pathanamthitta, Kollam and Nilgiris district, Moopy Estates

1370

11

Environment

Rainwater harvesting in All Estates in Wayanad, estates Thrissur, Idukki, Pathanamthitta, Kollam and Nilgiris district

900

12

Environment

Sustainability certifications

13

Environment

Sustainable agricultural All tea estates in practices to small tea Wayanad, Idukki and growers Nilgiris

1800

14

Environment

Water and soil conservation

All tea estates in Wayanad, Idukki and Nilgiris, Kumbazha and Mundakayam Estates

3400

15

Environment

Dry Day

All tea estates in Wayanad, Idukki and Nilgiris

5000

16

Environment

Plastic-free zones

All estates in Wayanad, Idukki and Nilgiris, Kumbazha and Mundakayam Estates

3800

17

Environment

Awareness class

Wallardie, Moongalaar and Pattumalay, Kundai Estates

123

18

Environment

Stand for Puthumala

All HML estates in Wayanad, Thrissur, Idukki, Pathanamthitta, Kollam and Nilgiris district, and Sentinel Rock Estate

18,567

19

Health

Monsoon diseases/ communicable diseases awareness campaigns/ Observing Dry Days, Chicken Guniya

All HML estates in Wayanad, Thrissur, Idukki, Pathanamthitta, Kollam and Nilgiris district, Mundakayam, Kumbazha, Mooply, Kundai, Wentworth

6679

All Estates in Wayanad, Thrissur, Idukki, Pathanamthitta, Kollam and Nilgiris district

No. of beneficiaries

1800

(continued)

Plantation of Hope: The Turnaround of Harissons Malayalam Ltd.

63

(continued) S. no

CSR themes

Activity

Locations

20

Health

Medical camps

All estates in Wayanad, Thrissur, Idukki, Pathanamthitta, Kollam and Nilgiris Districts, Mooply, Kundai, Mundkayam, Kumbazha, Nagamallay, Wallardie, Moongalaar, and Pattumallay Estates

No. of beneficiaries 6260

21

Health

Cancer awareness session

Sentinel Rock/Arrapetta

100

22

Health

Cloth collection campaign

Head Office—Cochin

150

23

Health

Health campaigns

All HML estates in Wayanad, Thrissur, Idukki, Pathanamthitta, Kollam and Nilgiris district, Wallardie, Moongalaar, and Pattumallay Estates

5060

Source HML Annual Report (2019–20)

by matching the price offered by the Russians. It leads to extensive erosion in quality and imaging.2 After that, the Tea Board India, responsible for overseeing and regulating production and trading, stepped in to salvage the situation. It formulated a mediumterm export strategy focused on developing and branding an “Indian tea” logo. It established standards to assess the reliability and quality of exports while geographically diversifying to new markets. In 2002, the Tea Board implemented the strategy in 22 markets. It hoped to increase the tea exports to these markets to 280 MKg., which amounted to an increase of 72 MKg. However, exports did not grow as expected, with significant losses in critical markets such as the Arab Republic of Egypt, CIS, the UK, and Poland.3 Exports continue to decrease year after year. For example, exports to CIS decreased by 2.37 MKg. between the financial years 2017–18 and 2018–19. The same period also witnessed a fall in demand for Indian tea in Egypt by 4.27 MKg. and in Saudi Arabia by 0.22 MKg. Overall, the export loss between the abovementioned financial years was estimated to be 2.07 MKg (see Exhibit 5). It is no wonder that while India is the second-largest tea producer in the world, in terms of exports, it is in a distant fourth position (see Exhibit 6). Slowly but surely, she needs to catch up to the produce from Kenya, Sri Lanka, and China.4 However, domestic consumption of tea continues to be the silver lining. Close to 88% of the total households in India consume tea. The penetration of tea within

December

November

December

Sri Lanka

Uganda

Tanzania

Source The Indian Tea Association

Total (above)

China

December

Malawi

Indonesia

33.9 2316

2232.1

55.7

298.1

48.3

32.2

363.1

94.6

1390.1

2019

28.6

35.5

275.9

45.2

33.2

December

Rwanda

90.7

467.4

December

October

1255.6

2020

Bangladesh

December

India

Kenya

January to

Country −4.1

−3.9

−15.6 −3.6

−5.3 −83.8

3846.9

33.9

3795.9

33.6

57.9

2616

50.8

2700 −36.3

−20.2

303.8

−7.4

−22.2

50.6

131

28.3

492.6

82.1

1338.6

2018 (January–December)

298

128.8 48.2

−6.4

32.2

0

3.1

458.9

96.1

1390.1

2019 (January–December)

−3.1

1

28.7

−9.7

−134.5 104.3

%

+/−

Exhibit 4 Snapshot of World Tea Production (in million kilograms (MKg))

64 M. Dhal and S. P. Pati

Unit price (INR/kg)

Unit price ($/kg)

58.53

370.26

1.87

6.38

11.29

1.69

17.96

Ireland

Poland

USA

Canada

UAE

Iran

111.17

111.70

14.20

4.28

8.42

0.56

3.46

Egypt (ARE)

Afghanistan

Bangladesh

45.64

1076.56

41.02

Saudi Arabia

362.16

113.10

96.97

301.97

9.96

Germany

137.99

323.79

3.83

United Kingdom

994.69

Netherlands

14.64

Total CIS

33.61

1.69

60.72

Other CIS

193.19

51.05

716.84

10.28

3.38

45.37

6.53

2.03

15.97

15.90

153.95

52.95

8.37

51.79

16.17

13.87

43.18

19.73

46.30

142.24

4.81

27.63

7.30

102.51

131.76

255.12

132.65

259.83

262.47

206.18

345.68

320.68

177.18

517.98

303.21

360.46

221.14

163.82

198.88

188.02

151.08

157.99

1.88

3.65

1.90

3.72

3.75

2.95

4.94

4.59

2.53

7.41

4.34

5.15

3.16

2.34

2.84

2.69

2.16

2.26

0.46

0.95

12.69

4.50

31.19

21.63

2.50

13.23

6.25

2.65

10.42

4.26

16.07

63.09

1.50

9.74

3.75

48.10

2017–18

Value (Million U$)

Qty (MKgs.)

Value (Cr. INR.)

2018–19

Qty (m · Kgs)

Kazakhstan

Ukraine

Russian Fed

Country name

Exhibit 5 Major country-wide exports during 2018–19

5.86

16.95

174.40

106.51

778.61

427.47

67.47

363.27

96.79

102.17

246.20

99.85

324.19

1039.75

29.19

177.15

56.24

777.17

Value (Cr. INR.)

0.91

2.63

27.06

16.53

120.82

66.33

10.47

56.37

15.02

15.85

38.20

15.49

50.30

161.34

4.53

27.49

8.73

120.59

Value (Million US$)

127.39

178.42

137.43

236.69

249.63

197.63

269.88

274.58

154.86

385.55

236.28

234.39

201.74

164.80

194.60

181.88

149.97

161.57

Unit price (INR/kg)

(continued)

1.98

2.77

2.13

3.67

3.87

3.07

4.19

4.26

2.40

5.98

3.67

3.64

3.13

2.56

3.02

2.82

2.33

2.51

Unit price ($/kg)

Plantation of Hope: The Turnaround of Harissons Malayalam Ltd. 65

14.59

2.43

32.25

Pakistan

Australia

Other countries

Source The Tea Board India

254.50

148.46

3.73

Japan

Total

2.44

154.11

0.11

Kenya

5506.84

726.39

91.88

55.62

3.55

Sri Lanka

29.02

180.19

Value (Cr. INR.)

1.18

10.58

Qty (m · Kgs)

2018–19

Singapore

China

Country name

(continued)

787.50

103.88

13.14

21.23

22.04

0.35

7.95

4.15

25.77

Value (Million U$)

216.38

225.24

378.76

101.73

412.72

229.58

156.70

246.69

170.26

Unit price (INR/kg)

3.09

3.22

5.42

1.45

5.90

3.28

2.24

3.53

2.43

Unit price ($/kg)

256.57

29.70

2.55

16.09

3.70

1.05

4.08

0.51

9.00

Qty (MKgs.)

2017–18

5064.88

592.96

90.90

147.94

147.80

15.43

52.11

14.17

154.08

Value (Cr. INR.)

785.92

92.01

14.11

22.96

22.93

2.39

8.09

2.20

23.91

Value (Million US$)

197.41

199.65

356.47

91.95

399.46

146.95

127.72

277.84

171.20

Unit price (INR/kg)

3.06

3.10

5.53

1.43

6.20

2.28

1.98

4.31

2.66

Unit price ($/kg)

66 M. Dhal and S. P. Pati

Plantation of Hope: The Turnaround of Harissons Malayalam Ltd.

67

Exhibit 6 India’s standing in world tea exports

Production (in MKg)

World

India

India’s share (%)

Global position

5490

1267

23

2nd

Consumption (in MKg)

5168

985

19

2nd

Exports (in MKg)

1774

217

12

4th

Source The Indian Tea Association (2017)

Exhibit 7 Break-up of the wage of a tea worker in Assam S. no.

Components of wage of daily rated workers

1 January 2017–31 December 2017

1a

Cash wage

137

1b

Additional compensation/incentives

6

Subtotal of 1a and 1b

143

Non-statutory benefits 2a

Concessional food grains

14.2

2b

Firewood

5.74

2c

Tea

3.66

Subtotal of 2a, 2b, and 2c Subtotal of 1 and 2

23.6 166.6

Benefits under Plantation Labour Act and Agreements 3a

Medical facilities

16.75

3b

Housing facilities

15.22

3c

Education facilities

3d

Welfare facilities

3e

Leave with wages and festival holiday Subtotal of 3a, 3b, 3c, 3d, and 3e Subtotal of 1, 2, and 3

2.83 5.6 14.95 55.35 221.95

Statutory benefits 4a

Bonus (deferred wage @ 20%)

4b

Provident fund

4c

Gratuity

10.67

Subtotal of 4a, 4b, and 4c

62.92

Subtotal of 1, 2, 3, and 4

284.87

31.59 20.66

a family is approximately 96%. Overall, 64% of India’s total population is a teadrinking population, with no difference in its consumption across socio-economic classes. A certain proportion of the population considers tea to be an “anytime drink.” It has led many small regional brands to mushroom in the market, contributing to the oversupply of the product. As an illustration, in 2017, the Indian

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M. Dhal and S. P. Pati

Tea Association estimated an excess supply of 100 MKg of tea.5 Prices have therefore remained static over the years,6 with tea of questionable quality dispersed in the market. It is of little surprise that 21% of the households reported having switched brands over the last 5 years.7 Therefore, many important players, such as Tata Tea and Hindustan Unilever (HUL), have exited from tea plantations to focus on branded teas. One of the most notable exits was the transfer of assets and liabilities of 17 tea estates in Munnar (Kerala), the regional office, and related service departments to a new company formed by past company employees in 2005. Named the Kannan Devan Hills Plantations Company Private Limited (KDHP), the company is touted as the future of plantation management in India. Approximately 13,000 employees of tea plantations are part of the new company’s shareholders, with 97% of them contributing to roughly 68% of its equity. The Tatas argue that it is a win–win situation. While employees will no longer experience the threat of extinction, the company will remain free from the enormous social security obligations and the confrontational employee-employer relationship. It will also be open to source the best quality leaves from anywhere. Similarly, in 2005, HUL transferred 100% of Doom Dooma Tea Company Limited to McLeod Russel India Limited (MRIL). It involved the sale of tea planted over 3100 hectares in three factories and 6100 people.8

2.2

Unhappy Workers

With the departure of corporations, the plantation owners found it increasingly difficult to meet the workers’ expectations. Accordingly, the quality of life and the sustainability of the workers’ livelihood have been stressed for a long time. It is no wonder that trade union activity within plantations has increased in recent years. Trade unions in the tea industry became a reality only after independence (i.e., August 1947). However, the union’s presence and relative strength differed across states. In West Bengal, the various unions have forged a common front to highlight common industry-wide issues. The Coordination Committee of Tea Plant Workers (CCTPW) and Committee for Defense of Plantation Workers’ Rights (CDPWR) actively raise the workers’ concerns.9 However, since these unions are affiliated with different political parties,10 there is a high likelihood that individual political interests often take precedence over workers’ concerns. The story is not very different in the tea plantations of southern India. The unions there are affiliated not just with the national-level political parties but also with the regional parties.11 Principally, workers suffer from three specific concerns. First, they are acutely distressed by their wages. The wages of tea industry workers are among the lowest in the country.12 Additionally, wages must be more consistent between the northern and southern parts of the nation. For example, in 2016, tea workers in Kerala

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were guaranteed a minimum wage of INR 153.83 per day, apart from other incentives.13 It is set to increase to INR. 182.4114 per day.1 However, the tea workers in Assam Valley received just INR 143 per day in 2017.15 Furthermore, there needs to be more clarity on how employers and workers define wages. The employers insist that all the benefits enjoyed by the workers, such as housing, medical facilities, firewood, and concessional food grains, be considered wages (see Exhibit 7 for a complete breakup of cost to company for a plantation worker). This is different from the Code of Wages (2019), which defines wages as basic pay, dearness allowance, and retaining allowance.16 Second, tea gardens are argued to be islands of poverty and exploitation that have scant respect for workers’ health. The majority of the plantation houses are broken and have not seen a repair for a long time. Workers complain of leaking and occasionally falling roofs, broken windows and doors, and unusable toilets. Coupled with low wages, pitiful and unhygienic living conditions affect the general physical and psychological health of workers. Almost everybody in the estate is anaemic, with many unable to work for the entire 26 days in a month. This further affects their earnings.17 Exposure to pesticides is another hazard that is often not considered. For example, in May 2010, one plantation worker, Gopal Tanti, dropped dead while spraying pesticide on a Tata-owned plantation in Assam. The manager kicked the body to check if the person did indeed die, fueling protests and riots by the workers. Two more young workers died in the police firing that ensued, while many were injured.18 Third, the workers are perturbed by the heavy workload expected from them. While many workers migrate elsewhere for better wages, others frequently fall ill, diminishing the labour supply in the estate. Consequently, many workers feel the pressure to work long hours. Most tea-pluckers, the only work women are engaged in, work from 8 AM to 5 PM. The lunch break ranges between 10 min and half an hour. Tea plucking is the most strenuous and the least paid in the industry. Factory workers generally work a 12-h shift. To ensure that workers confirm their high demands, labour-management is excessively authoritarian. Questions are discouraged, and people find themselves dismissed for minor infractions.19

3

HML: An Outlier

Against the above background, HML decided to participate in the Great Place to Work (GPW) survey to obtain feedback from the employees and benchmark itself against the competition. A great place to work is considered the “gold standard” in workplace culture assessment and recognition. In their first participation in 2014, HML secured a respectable 81st position among all the participating organizations from India. It helped the company gain a favourable perception from

1

However HML used to pay INR. 301 as guaranteed pay which was set to increase to INR. 410

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M. Dhal and S. P. Pati

external stakeholders while ascertaining the good practices they should carry forward. Participation in GPW also strengthened the communication process between the management and the employees. HML continued participating every other year, and the rank improved on every occasion. For 2020–21, HML secured the 4th rank. The organization was also adjudged as the best workplace for women in India in 2020. HML has excelled in all five indicators that measure the high-trust high-performance culture: credibility, pride, and camaraderie. The GPTW survey remarks that the company “provides multiple avenues of developing its employees, which highlights the company fostering a culture of continuous learning.” With plantations across the country in despair, how did HML manage to stand tall for its employees? What is the secret behind this triumph?

4

HML: A Great Place To Work

Although sceptical of the GPTW findings, Sachin opted to have a discussion with HML’s top management. He hoped to learn the underlying secret behind this result. He contemplated if this could be scaled up for all the companies under his leadership. Accordingly, he flew down to Kerala and sat in a closed-door meeting with Mr. Cherian George (CEO and Whole Time Director of HML) and Mr. N. S. Vinodkumar, the Head of New Business and Human Resources (HR) of HML. Listed below is his learning.

4.1

Culture

According to Sachin, “listening” is the core principle that guides HML’s culture. He attributes it partly to the nature of the industry. Plantations are a kind of isolated place. The estate head and the worker live on the same premises, deep within the forests, with many other individuals sourced from every possible stratum of society. They live and breathe together, accustomed to the ups and downs in life. Such an arrangement has existed for decades, which has made the workers feel like part of a large joint family. It is camaraderie in a system by design. Everybody stands by each other through thick and thin. Unsurprisingly, a few workers raised a hue and cry when the company delayed their wages during the COVID-19 pandemic. An estate manager is expected to lead the work inside the factory and within the community. Sachin asserts that it is a 24/7 job. He needs to be connected to the families staying inside the estate and intervene in any untoward incident, for example, a wild animal entering the estate or a fight within a family. Most managers would know at least 50–60% of the employees’ names. Some would even know what their child does. When a child of an employee graduates, the company celebrates them. Managers also attend weddings and are a regular sight at funeral ceremonies.

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The spirit of listening has made employees and workers face more gigantic catastrophes. Be it the rescue operation during the Kerala floods and landslides of 2019 or the prevailing pandemic, workers express no hesitation in reaching out to each other and the local communities, irrespective of caste, creed, or economic status. When the COVID survivors returned to work, there were celebrations even though nine of them had lost their lives. When a driver committed suicide in the estate, even the police refused to touch the body, fearing COVID. The manager put on protective gear and completed the necessary legal and ceremonial requirements. Listening deepens the relationship and helps bring people together. It also explains why workers risk their lives protecting the estate’s land from being encroached on by the locals. Listening has its ugly side too. When workers have problems, the managers allow them to protest instead of suppressing them. This has led to the loss of scores of man-days. However, there are few such instances. In tune with the spirit of listening, the management created the Joint Labour Management Council (JLMC) to tide over such strikes.

4.1.1 Joint Management Labour Council Vinod recalls that when he joined in 1998, it was difficult for a worker to meet a manager. However, the culture has changed since then. Now, any worker can go to the manager’s office and meet with a prior appointment. As elaborated earlier, the liberalization policy of the Indian government in 1991 opened many challenges for the plantation industry. The competitive environment resulted in lots of inward reflection within the organization. This propelled the management to initiate a “Joint Labour Management Council” (JLMC), although there was a “works committee” earlier. It is a forum with representatives from workers, supervisors, staff, and the manager. Its presence is found in every factory and division. The JLMC committee constitutes 10% of the total worker population. It represents various layers of the workers, who are also influential among the workforce as opinion-makers. Some of the members are also representatives of the union. One of the exciting aspects is that women workers constitute 60% of JLMC. JLMC has made it relatively effortless to pass messages to the larger worker body without distortion (see Exhibit 8 for the functioning of JLMC). It meets once every month and acts as an able intermediary between the workers and the management. It is a direct communication channel where communication happens in two ways: top-down and bottom-up. The JLMC is reconstituted every year. In a nutshell, approximately 45 JLMC meetings are conducted monthly across the seven tea and six rubber estates spread across Kerala. Vinod feels that one of the significant achievements of JLMC is that it empowers women. Although women are the most prominent worker category, their voices have yet to be found through the traditional male-dominated unions. JLMC filled this gap and brought forth their concerns to light. It has also contributed to a change in the mindset of the workers. They have become more accommodating of decisions and inclusive of each other.

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It is not to say that JLMC was initially welcomed with open arms by the workers. The trade unions perceived it as a threat to their power. They did not allow the workers to interact with the manager directly. It was believed that the JLMC was formed to marginalize them. However, the management insisted that the trade unions be part of JLMC. Slowly but surely, in a span of a year and half, the JLMC found acceptance with the unions. Vinod recollects one of the benefits of JLMC after the 2019 Kerala floods. When workers demanded more earnings, they were presented with facts about the company’s poor financial health. They offered to stretch and increase their productivity to earn extra incentives. Such a decision significantly resolved the workforce shortage in the estates. Production doubled in no time. Even the incentive plan was designed in consultation with the workers. Such discussion never happens in a collective bargaining scenario, where maximizing one’s gain becomes the sole objective. JLMC provides a platform where everyone can share their thoughts freely, irrespective of the hierarchy. It is an opportunity for all to practice the art of listening. Vinod asserts that one might not agree to all the demands, but sitting together and sharing a word, with tea and snacks, brings a sense of closeness and confidence. He summarizes it as follows: “When you start to listen, you begin interacting. This reveals the underlying concerns and not the superficial problems. Soon they come up with solutions. All they need is an ear.” Apart from JLMC, there is also a monthly meeting with the trade unions in each area. There is also a weekly production meeting with the workers. HML follows an open-door policy, and people with designated names, contact numbers, and designations are always available for a conversation.

4.2

HRM Practices

HML has an average attrition rate of 10–12%. However, in 2017, the attrition rate was 18%, arguably the highest in its recent history. HML prefers to hire from something other than reputed universities and institutions. Instead, it creates opportunities for internal people. The RPG Group is committed to the policy of job rotation. They recruit their talents laterally by giving internal employees a chance. They place them on a long-term, mentor-supported cross-functional, and cultural grooming. Approximately 50% of managerial cadres are promoted from within. For example, the current CEO, Mr. Cherian M. George, has been with the organization for 26 years. He began his career with HML in operations. The previous CEO was with HML for 42 years. Even Vinod commenced his career in operations and made a role change only after 19 years. The intention is clear: to have leaders with not only business roundness but also the people, as the industry is labour-intensive.

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4.2.1 Hiring The philosophy of giving the first chance to internal people is also extended to the workers and staff. The immediate family members (such as son, daughter, brother, sister, husband, and wife) of existing workers below the age of 35 years are given first preference in the case of an available position. Vinodkumar reasons that doing so helps HML maintain its culture. These people have stayed on the estate for many years and are, therefore, conversant with the desired values of the place. Whenever a worker’s family member expresses interest in working, the company hires them as temporary workers. If their attendance and physical fitness are found to be satisfactory, they are regularized. Advertisements of available positions are communicated on estate noticeboards. Attempts are made to fill up the positions in a month. HML extends second priority in hiring the people of the nearby locality through acquaintances, while third preference is given to the migrant workers. The migrants are mainly from the states of Assam, Jharkhand, and Madhya Pradesh. They are hired based on referral, with experienced migrant workers encouraged to bring people from their native villages as they know the environment and culture of HML. The company sponsors such “hiring trips”. The company adopts a careful police verification process before enrolling migrant workers. The least preferred method for hiring workers is through an agency, although only some are recruited this way. There is no qualification specified, but skill is preferred as a standard. All the candidates had to undergo an interview with the Divisional Manager and a medical test. Almost 75% of the temporary workers become permanent within a year, and others lose out mostly because they are irregular or due to health reasons. As a plantation company that demands physical work, HML strives to maintain good diversity and does not shy away from hiring people with differences. Such employees are suitably placed in departments such as testing or quality where their competency can be put to the best use. Despite all the measures, HML faces an acute shortage of labour owing to its location. The recruitment process for staff and executives is prominent. The company will only recruit people who understand and like a tea estate environment. People who like a hill station, who want to be solitary, are comfortable in less populated environments, e.g., being alone, want to avoid frequently going to a shopping mall or movies, are typically preferred. A basic aptitude test is in place, which is preferred over academic brilliance, but interested individuals must be undergraduates with good physical endurance ability. Even though the company prefers people from an academic background in forestry or agriculture, potential hires must demonstrate their inclination towards an outdoor life and be natural in building relationships. The hiring process is multiphased. The candidate is customarily made to stay with a manager to evaluate his ability to make a personal connection. Managers also appraise how the candidate carries himself during the interaction and behaves with the lady of the house. The next day, the candidate is asked to visit the Division Muster office early in the morning. After spending time there, he is made to go around the workplaces,

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estates, and factories. He is asked to note his observations and submit a report on his findings. The organization evaluates whether the report mentions only agriculture or whether the candidate has an eye to discover welfare measures, people, and problems (e.g., water supply). How many people did he interact with, and how many people wanted to interact with him? After this, the estate manager escorts him to the club in the evening, where he is exposed to the planters’ evening social life. All the time, his etiquette is observed and tested. The candidate is purposely told about all the possible negatives and hardships cupped in the job (for example, long periods of isolation inside the forests and encounters with wild animals, particularly elephants). It is done to limit future attrition while giving them the reality of the workplace. Many employees are hired through the referral scheme. Vinod asserts that hiring is strictly based on competencies. Recently, the company hired two young girls as welfare officers. Apart from the Master’s degree in social work, riding a bullet (motorcycle) was an additional requirement. It is the only vehicle through which they can easily commute the rain-washed hilly terrain. The girls outperformed the men. Since then, the company has decided to recruit only women as welfare officers, owing to the large number of women labourers working in the estate.

4.2.2 Compensation and Benefits HML’s salary and emoluments, unlike other businesses, are comprised of salary, variable pay, and perks. Executives are accommodated in a large bungalow in the middle of the tea gardens. It provides them with a motorcycle/jeep and fuel. Household help is made available. Schools and hospitals are present for families, and children’s education is sponsored. Finally, every employee and worker in the estate is insured, while executives have a superannuation scheme. All employees, including workers, are entitled to gratuity and maternity benefits. They are entitled to get 1 day of earned leave for every 20 days of work. Usually, people like to accumulate their leaves and utilize them in aggregate as vacations or visit their native places. The workers are entitled to 13 paid leaves annually and are eligible for the statutory bonus. The worker and the employer also contribute to the Kerala Labour Welfare Fund. HML has hospitals to take care of employee health. The company also reimburses expenses when its employees and workers are referred to other hospitals for better/specialized treatment. If admitted to a hospital, the worker is paid two-thirds of his wage for up to 45 days. On some occasions, HML has allowed attendants on paid wages to care for the hospitalized employee. The workers are covered under the Plantation Labour Act 1951, and they enjoyed every benefit assured by the legislation. The labour housing provided by the company is well equipped with a water and electricity supply with regular testing and chlorination of water every 6 months. The other benefits provided to workers include overtime allowance, night shift allowance, crèche facilities, uniform, sleeping blankets, etc.

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4.3

75

Employee Relations

Trade unionism is prevalent in HML and plays a vital role in shaping employee relations in the organization. HML has a total of 35 trade unions across states. Most of them are affiliated with central trade unions such as AITUC, INTUC, CITU, and Bharatiya Mazdoor Sangh (BMS). The Idduki Estate has 12 unions, the Wayanad Estate has 6 unions, and the Thrissur Estate has 5 unions. Kerala, being a politically active province with a rich history of communist influence, has provided fertile ground for many unions affiliated with many political parties to mushroom. At the turn of the twentieth century, there was much disgruntlement in the management of unions in HML. Political interference only increased the chaos. It resulted in many violent meetings, gheraos20 and assaults, with people breaking into offices. These incidents would reach their peak coinciding with the assembly elections in the state. The inauguration of JLMC has assisted in establishing a direct communication channel, which helped reduce these disputes. As a result, there was a significant reduction witnessed after 2000. However, despite such measures, workers are always open to external manipulation, which could disturb industrial peace. One such incident occurred in 2016 when HML declared that it would pay a minimum statutory bonus of 8.33%, owing to the losses it encountered. Although many employees accepted the bonus, the majority union affiliated with CITU called for a strike. With assembly elections around the corner and the trade union secretary being a prospective candidate for the Legislative Assembly, the situation provided an opportunity to fuel worker unrest to gain political mileage. The union members prevented the willing workers from entering the factory, leading to the shutdown of operation. The management resisted strongly and argued that even if they agree to pay more, they would not be able to, because there is no money left. While the agitation lasted for 23 days (March 1–23, 2016), the silver lining was that the strike was confined only to the Wayanad Estate. There were no notable instances of violence, barring a few incidents of the offices and a few managerial residences being stoned. The union demanded an additional ex gratia payment of INR 2000 beyond the eligible statutory bonus of 8.33%. The strike ended with intervention from the District Collector. The management agreed to pay INR 1000 as a recoverable advance. Looking back, the company pegs the total loss from this incident at INR 180 million. Also, encasing the incident, the union secretary won the election and became a Legislative Assembly (MLA) member. It must be said here that the wage for the plantation is fixed by a tripartite “Plantation Labour Committee” and reviewed once every 3 years. The workers are paid incentives based on the kilogram of output. To obtain the basic wage, one worker must collect at least 27 kg of tea leaves. The incentive pattern is as follows: for the first 14 kg, the worker would be paid 80 paise per kg; for the next 14 kg, they are eligible to receive INR 1.10 per kg; and beyond that, they would be paid INR 1.50 per kg. The company needs to make more profit to pay bonuses and has

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continued to pay the lowest guaranteed minimum statutory bonus of 8.33%. It was in 2012 that HML paid a 16% bonus to the workers. Nevertheless, most workers are very accommodating. They know that the managers have only their best interests in mind. For example, the plantation industry is hit by extreme weather conditions. Tea leaf collection cannot occur during heavy rain periods. In such times, the salaries of the executives are delayed by a month or two. This helps the company to tend to the workers. Most recently, during the pandemic-induced lockdown (April–July 2020), most of the managerial staff took a salary roll-back and kept the cash flow healthy to pay the workers’ wages. Later, when the situation improved, the company returned all the rolled-back amount.

5

The Road Ahead

Cherian and Vinod wanted to discuss the plan for the next financial year with Sachin. They were visibly elated. After the disastrous financial year of 2018–19, HML logged in a respectable profit of 36 lakhs. Coincidentally, it also secured the fourth rank in the GPW survey. They believed that the workplace culture and the HRM practices have contributed to this turnaround. Cherian expressed his confidence that the road ahead would be only smoother, with many accolades to be gathered on the way. However, Sachin’s observation is less than enthusiastic. “Look at your numbers,” he had cautioned. In summary, although there is a 30% increase in productivity, the labour and operational costs are also rising. The RPG Group is worth INR 250 billion, of which HML is just INR 2 billion. Will it be a good business decision for RPG Group to do away with HML? Finally, there is a strong possibility that the culture of HML is such because of its geographical context. Isolated terrain limits people’s choices, forcing them to stay together. This looks like a forced camaraderie, not very unreal, but not sustainable either. Great culture must lead to continuous profitability. HML looks far away from it. Is the road ahead for HML hazy as the mist that covers its tea estates? Sachin wonders.

5.1

Classroom Questions

1. Why is HML not making money? 2. Without profit, what makes a company a great place to work? Do you think HML could sustain its position in the future great place to Work surveys? 3. Will any strategy to enhance the profitability of HML be implementable in the “good” workplace? Exhibit 8 The Functioning of JLMC JLMC: Meeting Format The meetings begin with a review of the previous minutes of meeting.

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KPI—Budget and Achievement The first agenda of JLMC is usually the analysis of the production and productivity of the division. An analysis of the planned activities versus the achieved outcomes is undertaken. A comparison with other divisions and our competing estates and the action plan on agriculture operations and harvesting will also be discussed in JLMC. Safety JLMCs play a vital role in safety aspects. A detailed analysis of accidents is performed, and proactive measures and guidelines are implemented based on the suggestions in JLMC. Near misses are captured and discussed in detail, and corrective actions are planned. Idea Generation JLMC platforms are “Kaizen factories.” Ideas and improvements on various processes and procedures are solicited in JLMC forums. Wellness Session JLMCs are also considered to be lifestyle and wellness platforms. JLMC members are the key drivers of our sustainability. Various programs, such as training on banking operations and positive behavioural videos, are conducted for JLMC members and other workers with governmental and other nongovernmental agencies’ help. Absenteeism Control Absenteeism is also controlled through the effective intervention of JLMC members. They undertake house visits and group counselling to reduce absenteeism. Employee Engagement Activities Employee engagement activities in estates are organized and coordinated by the JLMCs of the respective divisions. This ensures maximum employee participation in various activities. Grievance Redressal JLMC is the platform where worker representatives can raise their grievances. These grievance points are documented, and follow-up efforts are taken to resolve the issues. This leads to proactive and harmonious labour relations, which in turn improves the working climate. Welfare and Health Expenditure Welfare expenses such as housing, water supply, medical cost, and other social costs are shared and reviewed in JLMC meetings. The committee also prioritizes and formalizes the renovation of houses and other maintenance works in the estate.

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Socio-economic Environment All the new government scheme implementations, such as Aadhaar seeding/PFUAN updating and new banking updating, are discussed and successfully driven in this session. Workers’ Benefits, Rewards, and Recognitions Under this session, the management informs the main organizational announcements to the workers. The reward and recognition of the workers, e.g., the highest plucker of the division or the retirement recognitions, are also conducted in the meeting. All the above-described points are regularly discussed in every JLMC meeting. All the JLMC meetings are correctly documented, and the minutes of the meeting are displayed on the notice board. End Notes

1. Core values of HML were accessed at https://harrisonsmalayalam.com/code-ofconduct/, on 15th Feb., 2021. 2. V. N. Asopa (2007), Tea Industry of India: The Cup that Cheers has Tears, W. P. No. 2007–07-02, Indian Institute of Management, Ahmedabad (India). 3. V. N. Asopa (2007). 4. V. N. Asopa (2007). 5. Indian Tea Association (2017), Submissions on the Code on Wages, 2017, Indian Tea Association: Kolkata. 6. Indian Tea Association (2017). 7. The Tea Board India (2019), Executive Summary of Study on Domestic Consumption of Tea in India. The Tea Board India: Kolkata (accessed at http://tea board.gov.in/TEABOARDPAGE/MjA= on 5th Feb. 2021). 8. Saji M. Kadavil (2007), Indian Tea Research, The Tea Board of India: Kolkata [accessed from https://www.somo.nl/nl/wp-content/uploads/sites/2/ 2007/01/Indian-Tea-Research.pdf at 8th Feb, 2021]. 9. Sujata Gothoskar (2012), This Chay is Bitter: Exploitative Relations in the Tea Industry, Economic and Political Weekly, Vol. 47, N0. 50, pp. 33–40. 10. Sujata Gothoskar (2012) writes that the CCTPW comprises of unions that are affiliated to Center of Indian Trade Unions (CITU, affiliated to the Communist Party of India, Marxist), The Indian National Trade Union Congress (INTUC, affiliated to the Indian National Congress), the All India Trade Union Congress (AITUC, affiliated to the Communist Party of India), the Hind Mazdoor Kisan Panchayat (HMKP), and the United Trade Union Congress (UTUC, affiliated to Revolutionary Socialist Party). Similarly, the CDPWR is populated with unions affiliated to the Indian National Congress party and the Janata Dal. Recently, two new unions—the Gorkha Jan Mukti Morcha and Progressive Tea Workers’ Union—have also emerged in the Industrial relations landscape of West Bengal plantation industry.

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11. Sujata Gothoskar (2012) suggests that the trade unions in Southern India are affiliated to the Indian National Congress, Communist Party of India, Marxist, Communist Party of India, Dravida Munnetra Kazhagam, and All India Dravida Munnetra Kazhagam. 12. Sujata Gothoskar (2012). 13. Government of Kerala (2016), Labour and Skills (E) Department, G.O. (P) No. 76/2016/LBR dated 17th May, 2016. 14. Government of Kerala (2020), Labour and Skills (E) Department, G.O. (P) No. LBRD-E1/5/2020-LBRD, dated 23rd Jan., 2020. 15. Indian Tea Association (2017). 16. The Gazette of India, Ministry of Law and Justice, The Code on Wages, 2019, published on 8th Aug., 2019. 17. Sujata Gothoskar (2012). 18. Sujata Gothoskar, Ashwini Sukthankar and Jasper Goss (2010), In cold blood: Death by poison, death by bullets, The International Union of Foodworkers (IUF) [retrieved from http://sanhati.com/wp-content/uploads/2010/10/tata-tea_ ff-report.pdf on 11th Feb., 2021]. 19. Sujata Gothoskar (2012). 20. Confining the managerial people to a space or a room surrounded by agitators, denying the basic amenities such as food, water or access to washroom and forcing them to concede to the demand.

Appendix: Teaching Notes Case Synopsis The case describes the culture and HRM practices prevalent in Harrisons Malayalam Limited (HML), a company engaged in tea plantations in the Western Ghats of India, with a legacy stretching to two centuries. Currently, HML is owned by the RPG Enterprises. In 2020, HML secured the fourth position among the Indian corporations in the Great Place to Work (GPW) survey. Surprisingly, this recognition of an excellent culture only translates to good financials. The company has registered only a 7% growth in revenue in a decade and is inconsistent in reporting profits. Accordingly, we write this case after several hours of discussion with Mr. Sachin Nandgaonkar (President and Group CEO of RPG Enterprises), Mr. Cherian George (CEO and Whole Time Director of HML), and Mr. N. S. Vinodkumar, the Head of New Business and Human Resources (H.R.) of HML in understanding this intriguing phenomenon. In summary, we wonder if “good culture” is an overstated phenomenon. We discuss this case from two theoretical perspectives: The Knowledge-Based View of a Firm (Kaplan, Schenkel, von Krogh & Weber, 2001) and Kelly’s (1998) Mobilization Theory of Industrial relations. These help the students appreciate the organization’s status and predict the possible outcomes if any changes are made.

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The case promises to serve as a critical tool in questioning many practices that employees and management feel as artefacts of an excellent organizational culture.

Case Positioning and Setting Firm competitiveness, Industrial relations, Human resource management.

Case Questions I. Why is HML not Making Money? First, the instructor must ask the students to discuss the firm’s financial health for the last 10 years. We compute here only for the Financial Year 2019–20, providing the formulae for the benefit of the students (Table 1). It is apparent that the company is struggling to stay afloat. Furthermore, we calculated the cash flow for 2019–20 (Table 2). The cash flow of HML is positive only when it borrows or does not invest in increasing its assets. It also means that either (1) its workforce is far away from producing enough to increase the net income or (2) it cannot command a reasonable price for its produce. In summary, HML’s workforce is hardly contributing to its business. The Industry Scenario Presently, Kenya, Sri Lanka, and China dominate the tea market in terms of exports. At the same time, Indian tea (which includes HML) is primarily sold to the price-sensitive domestic market. HML needs a good differentiation in its offerings and raise its quality to compete. What is stopping it from doing so? The Knowledge-Based View of the Firm The knowledge-based view of the firm conceptualizes it as a knowledge-processing institution with knowledge as its leading strategy. Scholars argue that firms superior in accessing, integrating, and deploying knowledge turn to being successful competitively. Doing so requires complex strategic design and implementation instead of replicating successful domestic strategies (Grant & Phene, 2021). However, knowledge is not usually directly observable or measurable. While some of it is explicit, such as technology, information, and routine (Grant & Phene, 2021), much of it is tacit, such as managerial skills, beliefs, and culture. Tacit knowledge usually holds the source of competitive advantage and is not fully convertible to explicit knowledge. Instead, its existence and properties can be inferred through firm capabilities that are manifested in observable action (Kaplan et al.2001). Six different types of firm capabilities are identified in the literature, which Kaplan et al. (2001) have placed in dyads: creation (capacity to combine knowledge with knowledge or resources to create valuable output) and

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Table 1 Financial health of HML (Financial year 2019–20) S. no Financial health parameters Formula/metric

HML’s score for 2019–20

1

Profitability

Net margin = Net profit/ Total revenue

2

Operating efficiency

Operating margin = PBIT/ 6.2% (there is hardly any Total revenue money to pay interest and taxes. It will be difficult for HML to raise credit for its operations, considering shareholder contribution has not increased)

3

Solvency

Debt/Equity ratio = Total debt/Shareholder’s equity

21.8 (highly risky investment. The shareholders have no money to pay back the creditors, along with interest, in case HML winds up operations. This also means that raising capital for future operations is doubtful)

Interest coverage ratio = PBIT/Interest expense

1.6 (this indicates how many times the income is available to pay the interest on the debt. At least this must be 1.5. This ratio must be calculated over a range of time to get a better assessment)

4

0.09% (