Introduction Legal experts dominated the HR scene in the 1960s and 1970s. They would probe deep into all the applicable labour laws to keep the workforce under a tight leash. The profession of IT was just not there in India. Manufacturing, as it then existed, was under the firm grip of what was then called the 'license-raj, permit raj". Industrialists were then quite happy to "take care" of the politicians in power to arm-twist the policies to suit their interests. Shoddy goods and services were quite common. It took years to even buy a scooter.
The legal experts always perfected the art of declaring lock-outs to keep the labour under their "control". In those days the situation was always quite beneficial to the Management to declare lock-outs. The loss of production would not diminish profits in any way since the markets were assured. The practice was hugely referred to as "Personnel Management and Industrial Relations". Back then, militant unionism was a reality with the communist trade unions like the CITU (affiliated to the CPI(M) party) being powerful. While the labor went on strikes, the Management would happily resort to lock-outs.
The advent of the Maruti car marked a new revolution. The ambassador and fiat models became slowly irrelevant. And in 1991, when the economic reforms changed the entire equations in Industrial Relations with internal trade unions being more the norm than the exception, the trade union movement itself lost its bite.
The new rules of the game dictated that the "Personnel" experts had to give way to the professionals from the XLRI and the TISS, Mumbai. These professionals had a different orientation and gave the practice a new shift. They insisted on collaboration and peace. The new field called HR was born.
However, even HR had its own pitfalls. It was seen as more relevant only to the supervisory and executive cadres. Today, we are neither here nor there. Be that as it may, the discussion on HR's status needs to include a) HR is still Top Management driven b) Measurement of HR contributions is very tricky c) Economics always overrides other human considerations d) Contract labour is here to stay e) Even in IT, the rules are rapidly changing f) The body of knowledge and practice are two different words and g) Synchronization of all efforts is never that easy.
HR is still Top-Management driven Even in the most normal of times, the CEO would rather cut down on labour cost, come what may. The independence, freedom, and say of HR professionals is never too easy. For instance, the top management may decide to just give a nominal increase in wages to supervisory staff in a recessionary environment. The CEO will happily play ball. The hapless HR fellow has to face the music. Even when he communicates the need to tighten the belt and so on, the supervisors and even workmen would immediately question the costly official foreign tours of the CEO and his managerial team. The HR guys can only do as much.
It is indeed a big task to manage all frustration and de-motivation in such environments. Worse, the entire final say in all performance appraisal matters is done by the CEO and the Top Management. The process becomes biased. There is absolutely no objectivity or any meaningful yardstick to measure performance in many organizations. This is still the practice in most family-managed Indian organizations. Those who are "yes-men" get to enjoy all the fruits.
In total contrast, the marketing professionals, particularly in FMCG companies, can show quick results in terms of increased sales, or entry into new markets and so on. The finance professionals account for every single pie. They are chided as "bean counters" but play ball to every direction of the Management. They are also rewarded very well as their efforts are always measurable.
Measurement of HR contributions is very tricky Yes, the IT industry has evolved good HR "metrics". One's contribution is always easy to measure in IT. Even team-player qualities can be easily measured. Performance appraisal is not a yearly exercise. However, in the manufacturing sector, it becomes difficult to measure HR. The HR professionals do not have any freedom and support for Top Mangement. The company often does well due to other considerations like proven technology and quality of products and assured markets. Hence, there is a big craze to work in HR in IT companies and not in the manufacturing sector, among the TISS and the XLRI products.
Economics always overrides other human considerations It is all about money in a recessionary environment. Every other consideration is overlooked. For example, in a leading auto company, a temporary retrenchment of 3000 people has been reported. Ditto for every other auto and auto ancillary company. The FMCG companies are also into this game. Even in the most normal times, the top management tends to load the existing supervisory staff with additional responsibilities. Today, with no fresh recruitment the problem of increased workload is quite common everywhere. Such actions compound the practical difficulties of HR professionals.
Contract labour is here to stay This is another aspect of Corporate life. Every single organization has adapted itself to the NEEM scheme. Since this is a purely training scheme, where the guys get to do regular jobs in less than six months, the labour that comes to work on fewer salaries in the form of additional labour is there for the asking. The HR fellow has to follow the game and finds it very difficult to solve the grievances of the NEEM trainees. Management of contract labour on a massive scale, with all consequent problems, is one major bottleneck in the development of HR as a profession.
Even in IT, the rules are rapidly changing The trend in the IT companies is now changing. Those in the 40 to 43 age group face and are being asked to go. Reportedly, the companies want to cut down on direct labour costs. It costs much less to hire trainees who can be used to do regular jobs after the training. This rather unhealthy development has one repercussion- trade unions may be formed in the IT sector as well.
At least in the short term, the positive developments in HR are likely to be nullified by the new atmosphere of tension and mistrust between Management and the IT professionals. Since the new practices of downsizing in IT companies is a comparatively new development, it does not augur well for the spirit of HR, which is to effectively optimize the talents and capabilities of all people.
The body of knowledge and practice are two different worlds The IT companies have made significant progress in formulating and implementing a good range of progressive HR practices. Yes, there may be a few organizations where the experienced people have been retrenched. However, the overall picture was good. It is still good. But in manufacturing, there is always a yawning gap between knowledge and practice. The theory and practice never match, even to the slightest degree. This bitter truth is always there for all to see. HR as a profession, with a body of knowledge that can be tested, can never work in such an atmosphere. Cost-cutting in terms of less labour is a reality in terms of recession. Nothing else is significant.
Synchronization of all efforts is never that easy Line managers need to buy the concepts of HR, as laid out by the HR experts. This never happens, as they are so busy doing their own work. HR inputs like Performance Appraisal and counselling, have been treated as unnecessary disturbances to their work. Likewise, their knowledge of labour laws and practical implications are not at all adequate.
Consequently, they would do blunders and then ask the HR experts to sort out all the problems. The top management would not even hear the HR experts, as they would be chasing short-term financial goals. Top Management commitment and support to HR are vital for its growth at any point in time. This sort of vital buy-in has been reported to have been done quite well in the Aditya Birla group. However, in the vast majority of manufacturing companies, the "fits and starts" approach only produces little results. This has the potential of pulling down the status of HR as a profession.
Conclusion HR as a profession can happen only if several bottle-necks are totally removed. This is easier said than done. The finer details of the bottle-necks have been discussed above. However, there is some hope that in the years to come, when the good times return, and the economy is back on track, there will be positive developments in the practice of HR and its evolution as a profession.
An excellent article. The people who are starting their career in HR should read this and understand how important is the HR department and how difficult is to manage this department functions.
For a manufacturing industry or for a service Industry, management of Men, Machine, Material and Money are required. Among these four Ms., the most difficult M is Men, that is the workforce. Managing them is the HR function. In an IT industry, the importance of Machines and Materials are less but the importance of the workforce is very high. So the HR department will have a big say in the service industry.
But in the manufacturing industry, there is a misconception that the workforce is not very important. This is making a big difference. Earlier days the organisations used to have personnel departments. Now HR is the new word. So many organisations particularly manufacturing organisations renamed their personnel department as the HR department but never followed the good practices required. This is the real problem.
In a way, the marketing department also deals with humans only. But they are supported by a well-made item in their hands. The quality of the product always helps them in managing the customer. Coming to the finance department, they will manage on paper and about papers (Currency Papers) only.
As far as my knowledge goes an HR person should be a bridge between the human resources and the top management. The top management should always give a good hearing to the voice of the HR. But unfortunately in our Indian scenario HR has to sing to the tunes of the top management. That is why the HR professionals from top institutes will go to IT industries rather than manufacturing industries.
Still, there is a long way to go in India, to get to know the importance of the HR department and how it will benefit the organisations in its long run. In fact, a well-organised HR department can do wonders in the manufacturing industry also. But many of the top bosses fail to understand this fact.
A well-mentored worker by an HR professional will always think about the welfare of the organisation also and will work for the company when the company is facing difficult situations.
HR experts are well versed in different aspects of human behaviour. They know the tools of motivating the employees so as to achieve the production targets of the business. They are aware of the facts that a particular employee can contribute significantly with the proper training of the production experts. It has been the normal practices of HR Personnel to offer appreciation letters to the entire group for making the records of production in the shop.
These motivate the workforce in raising the production level. However, they are not real bosses sometimes. The boss of the shop floor adopt some coercive action and demoralise them for petty things without letting the HR experts know the entire activities of the boss and workforce.
It may appear that HR is no longer supreme in all the stages but one thing is sure that the healthy practices are sure to stay. They need not be frustrated with the current trend.