Sukumar Vyas read the message on his E-mail. It was an anxious and urgent message from sudeep Rai, the vice-president of human resource development (HRD) at Trifle India Ltd. (TIL). It read: "TIL is downsizing in a big way, and this comes as a shock to me. It was not on the agenda when I accepted their offer, and I am wrecked by a tremendous feeling of despair over this exercise. The agitation I am feeling is straining my objectivity. I need to talk to you urgently."
Vyas pondered for a minute. Rai's inner conflict was not alien to him. However, he also knew that Rai would have to experience this conflict if he had to find a solution. Vyas' message back to Rai read: "I know your feeling. But you need to sift anger from concern. It can be debilitating. Do not react. You need to respond. There is no value in pitting `what was' with `what is.' You are at TIL and there is a development metaphor in downsizing too, if you look for it. I will now speak to you on Saturday, 10 P.M. Rai read the message with disappointment. He had hoped that his former professor and guide of 15 years would once again provide him with some much-needed light on his new dilemma. His feeling of disappointment with TIL was overwhelming. When he left Keelo India to join TIL, there were many more changes to cope with than just a new job in Bombay. For one, he was leaving behind his hometown, Bangalore, where he had lived all his life. However, he had made the change because the challenges before him at TIL, a multi-product company which manufactured processed foods, tetra-packed beverages and agrochemicals, were much more exciting than at Keelo, which was in household hygiene products.
TIL vice-president (HRD) Noshir Munsiff was leaving to take up an overseas posting with the parent company. Rai had been personally recruited by Munsif and chairman, D.N. Neogi. Munsiff had said that TIL was about to double its turnover, and that new plants and diversifications were planned. Rai got his first shock while he was still serving his notice period at Keelo. Neogi called him to say: "Rai, what I am going to tell you now may change your decision to join us, but in all fairness, I must inform you that we have decided to hive off our beverages division." For Rai, it was a major jolt, but having taken a decision to join TIL, he decided to stick by it-though he did feel a little bit despondent at having to start a new job with retrenchment.
The second shock came just two months after he joined TIL. TIL's processed foods business, which manufactured ketchup, canned vegetables and jams, was going through a severe crisis, and business economics demanded that the company either close down or downsize its Sewri plant. The plant, which employed some 1,200 workers, was low on productivity and the cost of production was very high. Rai could see it for himself. A plant that worked at 45% capacity and paid between Rs.9,000 and Rs.10,000 per worker could hardly be economically viable. Besides, the second processed foods plants at Nagpur, a reference point, was fully automated, and the low wages and tax benefits that came with being in a backward area rendered the unit cost of production significantly lower. And during his second month at TIL, Rai sat through a management committee meeting which decided that the workforce at Sewri be halved in the next two years.
The severity of the plan came as a rude shock to Rai. He had barely begun to come to terms with the hiving off of the beverages division, and he had the downsizing to contend with. He wrote to Vyas again: “Somehow, HRD guys like me believe that development is the metaphor we should work on, not asking people to leave. That seems negative. I came in anticipating the retrenchment of 100 people of the beverages division. But now it looks like 700 people." Further, Rai had very serious misgivings about the management's attitude to the business situation. The...
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