volvo’s hr practices 05-05v1.0
Post on 18-Nov-2014
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Volvo’s HR Practices
Job Enrichment Approach
- Siju- Ramu- Naval- Annadurai- Plakilla- Narayan- Rajaram
Objective
• Bringing out the Volvo’s conscious efforts to implement job enrichment concepts to improve Human resources productivity
• Its subsequent fallback
• Suggestions for improvement
Background Note
•Volvo started its enterprise in the year 1924.
•1939 – Volvo established as a profitable automobile manufacturer with a broad product range
•Employee strength – 51,000•1970 – Volvo experience Labor related problems for the 1st time
•Turnover/ Revenue
The Problem
• Increased Absenteeism
• Employee Turnover as high as 46%
• Government expenditure on education increasing the number of educated citizens – decline in blue collar resources
• Increase in foreign staff in Volvo’s workforce causing groupism & lack of unity
• Work Culture affected.
Changes Initiated
• Focus on Training & Development for the workforce
• Leadership sensitization programs to improve communication skills, labor welfare & group behavior
• Job enrichment through decentralization
• Invested money xxxxxx millon usd in
• Empowerment
• Restructure tall to flat
Job Enrichment•Job Rotation: Shifting around of jobs which was physically & psychologically different.
Benefits FlexibilityEmpowermentDrop in Turnover from 40% to 10%
•Management Employee Councils: 16 councils across manufacturing & staff to handle issues related to production, marketing surveys & financial reports.
BenefitsDevelop plans for improving work conditions, employee policies, health & safety.Employee participation in key decisions.
Job Enrichment• Change Implementation- The traditional assembly line changed to
keeping in mind the worker’s requirement & nature of work .
Benefits- Jobs of repetitive nature now automated- Employees involved & contributing to the
change strategy
• Small Work Groups: - 3 to 9 member team consisting of a leader,
foreman & spokesperson, to work on specific tasks & divide work among themselves & have periodic meetings .
Benefits- Decentralization caused quick solutions for
pressing issues- Workers encouraged to talk about quality
control related issues harnessing a sense of belonging
- Employee felt more involved resulting in positive results
Job Enrichment
• Employee oriented technology:
- Instead of workers assembling the car body, the car body moved around the plant
Benefits
- Increased interaction among workers
- Sub tasks divided in an organised way
- Each team had personalised facilities
Limitations of the Approach
• External forces in the automotive industry changed – decline in the demand for cars in the global mark
• Volvo productivity low (32 hrs per car) compared to Japanese (21 hrs per car) & American plants(25 hrs per car)
• Experts felt that there was a strong mismatch between the amount of money spent on good training & the results
• The Volvo car was not performing well which further led to the non feasibility of the Job Enrichment Approach
Suggestions
• Workforce planning – Attract economical wage workers from developing countries
• Out source operations where labor & labor related laws are affordable.
• Creating the right balance between people & task management – the approach adopted was skewed.
• The process improvement measures are always continuous & not one time.
• Sufficient encouragement in the area of R&D to keep up with market trends.
Conclusion
• Job Enrichment is extremely important & yet must be well calculated to strike the right balance between people & production after analysing the possible developments that come up in the future.
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