Q8 of 20 Page 66

(Further information related to the above question 6) The management of company Bhasin Limited now realized its folly. In order to rectify the situation, it appointed a management consultant -Mukti Consultants - to recommend a restructuring plan to bring the company back on the rails. Mukti Consultants undertook a study of the production process at the plant of the company Bhasin Limited and recommended the following changes —

• The company should introduce scientific management with regard to production.


• Production Planning including routing, scheduling, dispatching, and feedback should be implemented.


• In order to separate planning from operational management ’Functional foremanship’ should be introduced.


• ‘Work study’ should be undertaken to optimize the use of resources.


• ‘Standardisation’ of all activities should be implemented to increase efficiency and accountability.


• To motivate the workers ‘Differential Piece Rate System’ should be implemented.


(The above changes should be introduced apart from the steps recommended as an answer to Part c - case problem 6 above.)


It was expected that the changes will bring about a radical transformation in the workings of the company and it will regain its pristine glory.


a. Do you think that the introduction of scientific management as recommended by M consultants will result in the intended outcome?


b. What precautions should the company undertake to implement the changes? Give your answer with regard to each technique separately as enunciated in points 1 through 6 in the case problem.


a. Although scientific management is an extremely good condition it would not be able to give effective results due to the following reasons:

a. The principle of the initiative will not help if functional foremanship is adopted.


b. A lot of stress would be generated in the organisation.


c. The adoption of professionals would lead to an increase in cost.


d. Market research will be of little help due to the increased competition.


e. With the introduction of the differential piece wage system, only the efficient workers would gain. The others would face a lot of instability if the target is not met.


b. The company should take the following precautions to implement the changes as they would not be readily accepted by everyone:


a. The company must appoint trained workers only in a few areas.


b. Extreme care must be undertaken while production planning.


c. Functional foremanship can be introduced but the workers must be consulted for the suggestion.


d. Optimum utilisation of time and money must be promoted.


e. Standardization must be implemented for material and machine.


f. Instead of introducing the differential wage system, financial incentives must be given to the workers who get more work done.


More from this chapter

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4

Discuss the following techniques of Scientific Work-Study:

a. Time Study


b. Motion Study


c. Fatigue Study.


d. Method Study


e. Simplification and standardization of work


 5

Discuss the differences between the contributions of Taylor and Fayol.

 6

Discuss the relevance of Taylor and Fayol’s contribution in the contemporary business environment.

 7

‘Bhasin’ limited was engaged in the business of food processing and selling its products under a popular brand. Lately, the business was expanding due to good quality and reasonable prices. Also with more people working the market for processed food was increasing. New players were also coming to cash in on the new trend. In order to keep its market share in the short run, the company directed its existing workforce to work overtime. But this resulted in many problems. Due to the increased pressure of work the efficiency of the workers declined. Sometimes the subordinates had to work for more than one superior resulting in declining efficiency. The divisions that were previously working on one product were also made to work on two or more products.

This resulted in a lot of overlapping and wastage. The workers were becoming undisciplined. The spirit of teamwork, which had characterized the company, previously was beginning to wane. Workers were feeling cheated and the initiative was declining. The quality of the products was beginning to decline and market share was on the verge of decrease. Actually, the company had implemented changes without creating the required infrastructure.


a. Identify the Principles of Management (out of 14 given by Henry Fayol) that were being violated by the company.


b. Explain these principles in brief.


c. What steps should the company management take in relation to the above principles to restore the company to its past glory?