People Management Fiasco in Honda Motors

Topics: Management, Trade union, Leadership Pages: 5 (1666 words) Published: February 21, 2013
People Management Fiasco in Honda Motorcycles and Scooters India Ltd

1. There were a few different key factors that led to the breakdown of industrial relations at HMSI. Although it seemed that HMSI was very concerned and aware of the needs of its employees, things still went downhill. The first issue arose in November of 2004. Union leaders were not impressed with the amount each worker received in their annual Diwali gift. They felt “belittled” that they received such a small gift when comparing it to the stature of the company in the global market. Workers were also upset they had to sign a “movement sheet” when bathroom or water breaks were needed. The company hardly ever granted shift changes between workers and would constantly threaten the workers with termination. The workers also complained of favoritism by managers, and were not permitted to share their grievances with top management. Workers were also unhappy with the attitude of the vice-president of manufacturing, who was a disciplinarian. This guy kicked an employee, which led to unrest within the company. The workers were not happy with the light punishment the VP received. In March 2005 the workers presented a list of 50 demands, which prompted management to create a compensation package for them, which they ultimately declined. The workers looked towards joining the union. The HMSI tried to stop the formation and delay it as much as possible, but on May 20, 2005, the union was formed. Key issues were debated and argued between management and union officials. Negotiations were held, but the conciliation ultimately failed. Soon after workers were fired and temporary workers hired to help the slowdown of production. HMSI looked to the police for protection against angry union workers, which led to the violence on July 25, 2005. The failure of the Union and HMSI to work together and make a better working environment led to the breakdown. 2. There were many different mistakes the Japanese and Indian managers made that contributed to the failure of the HSMI and contributed to the present situation. By looking at Hofstede’s model of power distance, some mistakes made by the managers may become clearer. I looked at the two biggest differences between the two the MAS and the UAI.

MAS- Masculinity/FemininityUAI- Uncertainty Avoidance
The MAS in japan is one of the highest ranked in the world according to the model. In corporate Japan, you see that employees are most motivated when they are fighting in a winning team against their competitors. What you also see as an expression of masculinity in Japan is the drive for excellence and perfection in every aspect of daily life. Managers from HMSI need to understand the difference in culture; although India is also considered to be masculine, it is nowhere near Japan. The UAI in Japan is also among the highest in the world. In corporate Japan, a lot of time and effort is put into feasibility studies and all the risk factors must be worked out before any project can start. Managers ask for all the detailed facts and figures before taking any decision. This high need for uncertainty avoidance is one of the reasons why changes are so difficult to realize in Japan. The HMSI managers failed to recognize the urgency that was needed to implement change to avoid potential disaster. The HSMI management approach was an Authoritarian style that may have translated well in Japan, but was not initially successful in India. The six-page newsletter the “Dream Team,” addressed no concerns of the employees. It seemed that the managers of HMSI lacked certain management skills that are essential in dealing with employee concerns. One example is that the management lacked negotiation skills needed to solve the problems the workers had. If proper changes were mad, the unionization may have been avoided completely. Also in a statement by Honda, certain management issues were addressed,...
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