Case: EMPLOYEE PARTICIPATION: A STRATEGIC PROCESS FOR TURNAROUND

INTRODUCTION

Bank of Baroda ranked among the first four nationalized banks in branch network, deposits, advances, and profits. It distinguished itself in banking innovations and advancements. It stressed employee development, rigorous selection for promotions and overseas posting, and involvement of unions and officers’ associations in official celebrations, annual business planning, and mid-year reviews.

The MP Zone

BoB’s branches in the Madhya Pradesh State were identified as the MP region, and the region was a part of the northern zone of the bank. In July 1994, the region was turned into a zone as its branches increased and directing the business activity of the vast geographical area of MP from the bank’s northern zone headquarters at New Delhi became difficult. The MP zone was the smallest of the 14 zones of the bank in branch network, business size, and profits. It had 82 branches distributed in two regions–– Bhopal and Raipur.

Not many medium and large industrial units existed in the zone. Banking business was predominantly lending to farm sector, small industry, and trading and raising deposits from public and government and semi-government corporations. The State Bank of India and the Central Bank of India, which were the lead bank in MP, enjoyed premium position in MP. BoB had responsibility for only one lead district in the zone.

WORKMEN’S UNIONS AND OFFICERS’ ASSOCIATION

The bank had two workmen’s unions––Bank of Baroda Employees’ Union, MP; and Bank of Baroda Employees Association, MP. The former was constituent of the All India Bank of Baroda Employees’ Federation recognized by the bank as the sole collective bargaining agent of workmen. The latter was constituent of the All India agent of workmen. The latter was a constituent of the All India Bank of Baroda Employees’ Co-ordination Committee, affiliated to banking industry’s major power block union, the All Indian Bank Employees Association (AITUC). In the present paper, Bank of Baroda Employees’ Union, MP will be referred to as Union-I and Bank of Baroda Employees Association as Union-II.

As regards the officers, the All India Bank of Baroda Officers’ Association, formed in September, 1964, recognized by the bank, existed in MP. There was also a tiny insignificant splinter association of officers. Over the years the apex body of officers’ association secured for its members many benefits, some of which were not available in all nationalized banks. The association was affiliated to the Indian National Bank Officers’ Congress (INBOC), banking wing of the Indian National Trade Union Congress (INTUC). Both the unions and the association were active in the MP

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zone. The usual rivalry between the unions existed. They tried to attract each other’s members and to outbid the other in resolving grievances.

THE TRIGGER

Early in August 1995, a new zonal manager took charge of the MP zone. Till now he had been in human resources development function. This was his first hardcore banking assignment. The MP zone’s productivity and profitability was much below the bank’s average. The business per employee (deposits + advances) in 1995 was Rs. 57.69 lakh against the bank’s Rs. 81.65 lakh. While the cost of deposits (7.13) was favorable compared to that of the bank (7.31), the yield on advances was 9.93 percent against the bank’s 13.15 percent. Profit to average business was also extremely low at 1.49 percent against the bank’s 2.13 percent. Although the zone had performed better in the year ending March 1995, its performance declined in subsequent months. In July 1995, its deposits stood at Rs. 465.97 crore against Rs. 488.87 crore as of March 1995, and advances were stagnant at Rs. 289 crore against Rs. 285.40 crore in March 1995.

The new zonal manager was concerned about the low levels of performance. The staff also seemed concerned. They felt that their zone, which earlier was part of northern zone, was not properly cultivated. They felt that they were not getting their share in the bank’s opportunities, like promotions, nominations for training, and overseas postings. Since the status of MP branches was not that of a zone, the staff unions and the association expected better direction/control of business and career advancement. Within 15 days of taking charge, the new zonal manager wrote to the branch managers. Pointing out the bright economic growth potentials of the State and the bank’s excellent business opportunities, he encouraged the staff to discover their “tremendous hidden abilities” and to participate in the growth of Madhya Pradesh through the bank’s achievements. He also emphatically stressed his immediate concerns—half-yearly business targets, mobilizing low-cost deposits, reducing cost, and improving health of advances, and assured the necessary support/guidance from his office. Sharing his assessment about the potentials of the staff, he observed, “People in the zone are sincere and dedicated. They are quite hard-working, positive in their approach and have tremendous hidden abilities.” They could be conspicuous winners, he hoped.

The zonal manager shared his optimism that the zone’s productivity and profitability would go up steeply if the employees and management took up the challenges. He concluded indicating his sense of urgency and open-door policy for people to write to him or to meet him. The letter was received positively and set the tone for better management–employee relations. Some employees took the initiative to discuss the issues concerning the zone and referred to the letter. They acknowledged and reciprocated the good wishes of the zonal manager.

The management–union interaction also began on a positive note. In the joint union–management meeting union leaders, as a ritual, greeted the new chief with flowers and offered their co-operation. The zonal manager warmly welcomed each group and observed that co-operation should not be confined to “talk” only. Pointing to the low working-results, he observed that the co-operation was dismal. He and the personnel head of the zone urged them to translate words into actions for better business results and exciting experience at the work places. Both pointed out hat if the unions/association collaborated, the zone’s potential could be realized.

The general secretary of the association enquired from the personnel head whether the management had a definite proposal and if so, the same could be placed before them for discussions.

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Union-I leader reminded the personnel head how the union fostered a culture of co-operation in the past. The discussions moved towards initiating action steps.

CORPORATE AGENDA

In August 1995, the Reserve Bank of India (RBI) fixed deadlines for all banks for clearing house keeping arrears and prescribed grave penalties like holding the chairman and managing directors responsible for non-compliance. BoB was in a serious housekeeping situation. It organized a meeting and sought co-operation of the apex level unions/association for clearing the arrears and reconciliation of pending accounts. Being prudent bankers and aware of the consequences, the leadership responded favorably and agreed that similar meetings could be organized at zones also.

BoB’s corporate office advised the zones to hold meetings with unions/association on a regular basis up to March 1996. At the zonal joint meeting was called on 20 September 1995, this was the first occasion in Madhya Pradesh that the two unions and the association sat together with the management representatives to discuss a business-related issue. In the MP zone, balancing of books was not in serious backlog. However, reconciliation of HODD, IBTA, and LMO accounts was not satisfactory, but the department concerned was confident on improving the position within the schedule. At this juncture, the zonal manager wondered whether the strategy for housekeeping improvement could be stretched to encompass collaboration of unions/association in business development rather that restricting it only to housekeeping.

INTITIATIVE FOR A LARGER AGENDA

The zonal committee of the bank comprised of two regional managers and senior executives of the zone. The committee discussed whether collaboration of the unions/association be sought for business development as the zone’s business was below the previous year’s levels. The personnel and planning heads were enthusiastic about the proposal. They argued that if the unions/association could collaborate in housekeeping, they could as well participate in business development. The regional manager and the credit head supported the idea but were not keen. They apprehended resistance from the unions and cautioned lest the agenda of housekeeping also suffered. Finally, the zonal committee decided to test the response of the unions/association in the meeting convened for housekeeping agenda.

In the management–unions meeting convened in September 1995, the zonal manager expressed his faith in the philosophy of participation and complemented the corporate office and the apex level unions/association for their initiatives. He emphasized that when all participate, resources multiply, innovative ideas and approaches emerge significant results are achieved. He pointed out that as all employees were going to apply for the bank’s equity shares in the offing, they would own the bank and, therefore, irrespective of the affiliations, all had responsibility for improving the bank’s image, reputation for service, and performance. He hoped that the two unions/association would participate vigorously in bringing housekeeping under control.

All facts and figures relating to the Zone’s housekeeping and reconciliation of accounts were placed before members in the meeting. Besides presenting a picture of housekeeping and reconciliation, the member were provided business targets for 1995-96 and actual performance levels so far reached. Broadly, deposits stood at Rs. 490 crore against the target of Rs. 534 crore for Sept’

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1995 and advances at Rs. 290 crore against target of Rs. 317.70 core for Sept’ 1995. The presentation stressed that a larger framework involving business performance of the Zone was provided for a general feedback on performance.

The management representatives expressed the desire that a zero level of pendency in IBTA could be aimed at and the unions/association chiefs were requested to extend full cooperation. Leaders of the unions/association appreciated the zonal manager’s faith in participative management. They were happy for being approached for solving the housekeeping problems. They tried to understand the data. They confessed that they were under the wrong impression that the zone was doing well. The leaders made several suggestions.

Union-I leader emphasized that reconciliation involved hard work for which arrangements should be made. “Housekeeping is like the central nervous system of a bank and must be completed without leaving arrears behind,” observed the association chief. The management representatives urged upon the leaders of unions to communicate to their member how far they were concerned about the commitments they were making (the word “commitment” was used in regard to their willingness for endeavour.)

Unions’ Suggestions

Among the various suggestions offered by the unions the following are noteworthy:a) The bank should inform periodically the housekeeping position to branch staff.b) Focus should be on improving customer service.c) The bank should dispose off the pending staff grievances.

Their suggestions were accepted. The suggestion on customer service was highly appreciated, as there was tremendous room for improvement. The action plan evolved included that the large branches should hold similar management–unions–association meetings at their end. One union suggested that large branches should identify names of officers and clerks who had aptitude for housekeeping and reconciliation work for accordingly assigning responsibility. It was pointed out that the mundane housekeeping work required desk-oriented hard workers. It was also decided to set deadlines for completion of work.

Union-I leader also suggested that a letter on the lines of the zonal manager’s letter of August 1995 be sent on housekeeping to all staff. The zonal manager turned this suggestion to fit a larger perspective. He made a counter-suggestion, “That would tantamount to one more communication from the management. Why not send a joint letter signed by the management and the unions and association.” The unexpected response was met with “blank faces” and non-pulsed body language. The point was left without pursuing for the moment. The meeting, however, succeeded in initiating the concept of a new relationship––associating the unions / association, through in a limited manner, with the business processes.

A draft circular was informally put up and cleared by the three leaders. Mentioning the intense interactions with the unions/association that led to the action programme, the circular urged the branch managers to take similar measures at their ends. The circular accelerated the interaction in many branches and conducive atmosphere started unfolding in the zone.

The unions / association leaders visited several branches and discussed the subject in a cordial atmosphere. A few branch managers reported that the leaders made courtesy calls on them and

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informally discussed housekeeping issues. In a few branches, as was reported, the union representatives briefed their members in union meetings about the seriousness of the housekeeping programme. A participative atmosphere started developing in the zone.

BoB managers were accustomed to command and control. Many of them, therefore, were not comfortable with the idea of the union participation in business matters, and their participation (even of some senior managers including the regional managers) was passive. The zonal manager preferred not to discuss this especially or persuade them. His assumption was that the process through which the passive managers were going through in this activity would in time promote trust in joint activity. However, countervailing forces were the planning department and to some extent the personnel department. They thought that the new process would enlarge the performance base in the zone and solve many problems like housekeeping arrears and employee grievances.

SECOND MEETING

The second meeting (October, 1995) moved the process of collaboration unexpectedly fast. It burst the bubble of passivity, as the determination with which the invited branch manager demanded discipline and genuine co-operation from the unions / association. It also gave them message to shed off apprehensions and to decide on concrete steps.

In the meeting, housekeeping position and business performance for the half-year ending September 1995 were discussed. The branch managers of 18 most-potential branches and the chiefs of the unions/association were invited.

The zone’s profit growth was observed to be stable. However, all present at the meeting expressed that the half-yearly performance on banking operations was bad and lopsided. The performance of the 18 branches represented in this meeting was also not satisfactory. The following causes were identified for unsatisfactory performance:

1. People were confined to desk work than doing aggressive marketing. Walk-in-business gave negligible growth.

2. Staff Involvement was not as per the expectation of the branch manager. Vast majority of staff felt that it was the branch manager’s responsibility to mobilize deposits, improve recovery, manage NPA, housekeeping, etc.

3. Branch managers were not yet holding group meetings on business development and housekeeping.

4. Competition was mounting, particularly in big cities like Indore. Private banks like IDBI posed a big threat.

5. The practice of sitting late and working hard was given up. Neither the officers not the staff stayed back to complete the work.

6. The tight market conditions affected the growth of the entire banking industry. Money supply had slowed down, so had industrial growth, deposit growth and the lending support.

7. Due to complacency, the chief manager level branches failed to set the trend expected of them.

8. The branch managers were unable to channel the staff co-operation usefully. Guidance was needed from the higher echelons in the zone.

9. The branch premises were not neat and clean. Broken Furniture was left lying here and there.

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10. Customer service needed improvement.

The union leaders and branch managers were finding fault with each other’s constituency. However, when they analyzed the problems, they agreed that these causes had varied effects on performance. They agreed that for a positive impact, the management and unions/association needed to work together. It was decided to formulate a strategy to overcome the weaknesses as soon as possible.

CO-OPERATION THROUGH CONFRONTATION

The unions/association offered unequivocal co-operation. They issued circulars to this effect. However, one chief manager said that issuance of circulars was not enough. He questioned them on the co-operation they were talking about. He said:

“I challenge all of you to come to my branch and see for yourself what work the people are doing. The co-operation either from officers of from the award staff is not up to expectation. No officer is prepared to sit late for completing the work, and the clerical staff does not even sit till the end of the office hours”.

He asked them to visit his branch and find for themselves the number of accounts opened by the staff under the staff incentive scheme of the bank. The chief manager, who himself was a union leader two decades back, made similar scathing remarks, and many other branch managers talked in the same vein. The association’s general secretary replied that late sitting should not be expected regularly as many urban branches were computerized. While some managers felt that the situation was going out of control, the manager vehemently repeated: “Sky is the limit as regards co-operation in business development.” “Sky is the limit” became the slogan for the day. It finally clinched a consensus that the unions/association chiefs would visit the branches.

A short-term strategy was evolved for a joint visit to the six branches of Indore. Over the last few years, the bank was losing its market share in Indore, the financial capital of Madhya Pradesh. It was felt that the turnaround of branches in Indore would have a multiplier effect on the zone’s business. Chief managers headed four of the city’s six branches. It was also decided that the joint team would visit other important branches also during the financial year. The confrontation affected the regional managers and others who were passive. They saw the gates of co-operation opening up and greater clarity and direction of collaboration emerging. Apprehension that the unions won’t respond favorably to business issues began clearing.

JOINT DECLARATIONS

Since the responses of the unions, the association, and managers were evidently becoming positive and the zonal manager raised the issue of “jointly signed letter” suggested earlier in the September meeting, he argued that the joint declaration of their participative decisions would inspire the employees. He also said that probably his circulars were not being read with the interest they deserved. This time the unions/association leaders’ agreed to sign the letters along with the zonal managers. It was agreed that such letters be sent not only to the branch managers but also to all employee. The first joint declaration letter was released the same day, i.e. on 30 th October 1995. Similar joint letters were issued to each staff member, from manager level down to the messenger. Message highlights of these letters are given below:

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Letter of 30 October 1995: Being the first letter it referred to a) the decision to issue circular jointly, b) unsatisfactory half-yearly performance, and c) concerns on which the management, unions, and association agreed on. It stressed the need for staff to take interest in business development and participate in the staff incentive scheme, reduce NPA, increase recovery, and provide courteous and prompt customer service. It advocated group-oriented endeavour and “conscious effort in creating team spirit”

Letter of 14 December 1995: focusing on the need for strategic planning, the letter admitted performance problems at Indore branches and pointed out the need for popularizing staff incentive scheme for deposit mobilization. It announced for the first time that in December the chiefs of the unions/association and the concerned regional manager would jointly visit Indore branches to “help out branches at Indore in accelerating their efforts in the areas of concern.”

Letter of 11 March 1996: The letter was captioned “What Customer Expects Vis-à-vis What We Need to Do.” It highlighted customer service as the mechanism for survival and bank’s goal as the fulfillment of the customer’s expectation by all––bank/zone/region/ branch/individual. Five expectations were listed out. The reader was requested to make his/her role in customer satisfaction. Nine items that needed speedier disposal were listed. Promising that the management would facilitate self-development through training, the letter ended with a reminder of the March 1996 targets.

Letter of 6 April 1996: announcing satisfactory performance of March 1996, the letter thanked all staff, acknowledged gains of joint effort, and highlighted the learning of new concept of managing through employees’ involvement in work. Suggesting that adherence to the branch/office timings would attract customers, the letter stressed punctuality and the need to put in a full day’s work and to do additional work willingly. It exhorted the staff to sustain the achieving trend.

OTHER INITIATIVES

Branch Intervention

As a matter of BoB’s culture and as a democratic right, representatives of the unions/association met the branch management as per a laid-down procedure called “Structured Meetings” to discuss staff grievances. It was, therefore, discussed and clarified right from the beginning to the unions/association that the joint intervention was not a grievance redressal activity. It was spelt out, though without any formal agreement, that the joint forum stood for tackling housekeeping arrears, reconciliation of accounts, and business development. The objective, therefore, was to build the focus jointly on various business aspects so that the zone’s vibrancy and synergy improves. The branch intervention was specifically aimed at the zonal level chiefs of unions/association and regional managers to facilitate branch staff and branch managers to sit together regularly to:

a) deliberate upon business growth problems, performance targets and how to achieve them; and

b) initiate actions to involve more and more staff in the business development process.

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Mega Get-together

Besides the formal joint forum meetings, the regional managers and the unions/association leaders began interacting informally. For the branch interventions in Indore, they decided to increase the awareness among the staff before starting the visits. They organized a mega get-together in November in Indore and invited the staff of all Indore branches. Over 200 staff gathered one evening. Unions/association leaders and concerned regional manager talked of teamwork, togetherness, and joint business actions. The causes of poor business performance were spelt out. Extracts from the minutes of the joint forum meeting of October about intervention in Indore branches were read out. The regional managers and unions/association leaders appealed for taking up the staff incentive scheme actively and clearing the backlog of housekeeping and reconciliation. Many officers and clerk applauded the idea of joint activity in business areas. Their questions were answered by both the leaders and regional manager. There was the case of a clerk expressing displeasure over his union exhorting them for canvassing business. His union leader explained to him the challenge of the time right on the spot. The mega get-together served as an ‘open house’. It paved the way for thinking together and taking up zone’s performance as a team-goal.

IMPACT OF PARTICIPATIVE INITIATIVE

i) Work processes

Joint declaration messages had deep impact on the managers and members of the unions/association. The rank and file read the joint messages that came about due to joint nature of the effort. Meetings were held at branches with visible vigor to look at business issues. At many large and medium branches, the staff canvassed business. Several bottlenecks, like clarity in the incentive scheme and local travel cost came to fore and decisions were taken.

Some branches discussed the contents of the joint declaration letters in the staff meetings. Earlier, to improve customer service, the zonal Office had released a circular on the concept of internal customer. In the changing relationships, the internal customer concept was discussed at some of the large-sized branches. Some branches reported that the union leaders were becoming cordial in discussions and meetings. The general secretaries of the unions/association went from branch to branch. Other office-bearers also jointed the visits. The process encouraged the staff towards greater care of customers and business. They used their contacts and neighborhood and family relation for new accounts. Even peons and messengers went for loan recovery from small borrowers.

Inter-union rivalry began waning. In banks there was often intense war of circulars: each union claimed benefits it obtained for its members: and each union criticized the branch managers of favoritism towards rivals and discrimination against its own members. All such complaints, fights, and noises were on the wane. Unproductive overt outbursts and attacks and claims of victories were conspicuous by their absence. The two unions started agreeing with each other on business issues. An interesting case was the transfer of a clerk, who was a member of Union-I. He requested the management through proper channel for transfer to Bhopal from Khandwa Branch. His widowed mother was undergoing a treatment for a broken hip. Normally such transfers were done in BoB strictly on the applicant’s seniority. The clerk was well connected with a few

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ministers and bureaucrats in the government. The regional manager wanted the clerk to be transferred to Bhopal so that his contacts could be tapped for business development. The transfer proposal was informally put up to the union leaders strictly as business proposition. Transferring the clerk meant bypassing six other applicants, who all belonged to Union-II.

The general secretary of Union-II asked the other general secretary (of Union-I) about his views on the transfer. The latter replied, “Had the management unilaterally affected the transfer, we would have protested. Now at least we have been consulted and that is what we can tell our members”. This pro-business reaction by the unions was a total change in attitude and thinking of the union leaders. One major decision of the joint forum did not work well. The joint forum identified at computerized branches six non-cash activities to remain open for customers even after banking hours. However, this decision did not take off because the focus required for the success of this change was not in-built. A few years later, the bank introduced similar services at computerized branches.

ii) Business performance

Involving employees in defining business issues, contributing to decisions, strengthening communication about those issues, and promoting team spirit resulted in higher business growth and profits when the financial year ended in March 1996. The 1995-96 results revealed the following:

1. Deposit is a stochastic variable in banking business. The zone’s growth of total deposits was 17.31 percent against inconsistent growth ranging between 1.47 percent and 20 per cent during the preceding three years. Nevertheless, during the fund-starved year of 1995-96, the zone’s deposits growth was substantially better that the growth rate recorded by the bank was 6.92 percent.

2. The growth in deposits of branches headed by chief managers, which had been declining /stagnant in previous years, was very much satisfactory after a long time. Deposits outstanding increased by Rs. 28.8 crore recording 17.29 percent growth.

3. As funds position during the year was tight, the bank had imposed credit restrictions. Therefore, advances growth was bound to be adversely affected .The zone’s advances growth was 8.98 percent, close to the bank’s advances growth of 9.46 percent for the year 1995-96. A laggard zone catching up with the bank’s growth rate within a year, was excellent performance. In subsequent years advances growth rate was stable and substantial.

4. One of the important measures of the quality of credit management was the ratio of non-performing assets (NPA). The NPA as a percentage to total advances that ranged between 35 percent and 38 percent in previous years came down to 23.51 percent. It reduced further in subsequent years. NPA amount of Rs. 12 crore was recovered during the year. However, the adverse feature was that the zone added Rs. 13.55 crore of new NPA.

5. Profitability and productivity ratios also improved. Taking head office interests on deposits into consideration, profit was Rs. 14.29 crore––rise of Rs. 3.84 corore over the previous 0.30 over previous year. The business per employee rose from Rs. 57.69 lakh per employee to Rs. 64.42 lakh per employee. The per employee incremental business rise in the zone in 195-96 was Rs. 6.73 lakh while for the bank as a whole it was Rs. 5.20 lakh.

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6. The balancing of books improved. Only one branch was in arrears for three months category. Even though the balancing of accounts improved in different accounts, the improvement was not significant.

In short, there was remarkable all-round business growth during 1995-96 n the MP zone. The same growth rates were maintained or improved upon in subsequent years.

iii) Positive Feedback

What was going on in the MP zone of BoB came to the notice of the corporate management and the apex level unions/association. Their comments were as follows:

In a letter to the zonal manager, the chairman and managing director of the bank appreciated the support extended by the unions/association. The all-India general secretary, officers association, in his letter of 29th November 1995 to the zonal manager, remarked the effort as: “a commendable initiative taken by you to enthuse involvement of all staff members at grass root level.” He hoped that the representatives of the trade unions would continue to communicate with their members and made certain suggestions to accelerate the process. These suggestions were given top priority in streamlining the communication process.

The all-India general secretary of Union-I, who was also workman director, expressed his views in a business development meeting with local branch manager and the union representatives for the MP zone. In this meeting of 27 January 1996, he stated that the involvement of his union in business matters was a non-conventional union role and that “his members are quite competent to achieve the corporate goals of our bank”. He exhorted for mutual / voluntary targets fixed for the staff members particularly for deposit mobilization and NPA recovery. The interest that the general secretary showed removed the apprehensions aired by some union members about participation in business development.

The general secretary of Union-II invited the zonal manager and some local branch managers to the foundation day celebrations of the union on 20 April 1996. Several people expressed solidarity for working class, union objectives, and union mission. The general secretary referred to joint forum of BoB and related it with the collaborative culture that was developing. He said: apna hak to lena hi hai. Us ke liye ladna bhi hai. Lekin under ka kaam aur varishth seva bhi karna ya karvana unions ki jimmewari hai kyonki yadi murgi nahi hogi to anda kaun dega.

(We of course have to claim our rights. Also fight for them. At the same time, it’s the union’s responsibility to provide and ensure smooth operations and better customer service. If there is no goose where would the eggs come from.)

His remarks attracted some discussion. It was heartening that such business-oriented ideas came from a union leader who once upon time was a fundamentalist. Probably, this was the outcome of the joint forum.

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PROBLEM SOLVING

All was not smooth. Problems had to be confronted. Great importance was attached to the early solution of problems so that smooth process continued. The management was mentally prepared that such problems would come up during the transformation process and that the change agents would have to gear up their grey cells. Some of the problems that were successfully resolved were as follows:

Fiasco in a Branch

By the end of January 1996, many branches were in the midst of staff meetings for business development. Business figures of branches were improving. Customer service showed improvement. However, after three successful interventions at Indore branches, Union-II created a commotion at a meeting in a branch in Indore, alleging that a large number of employee grievances were pending at the branch and the chief manager of the branch was doing nothing about them. He was adamant that the grievances should be settled before going on to staff discussions for business development. The regional manager and the leaders of Union-I/association left in frustration.

This was an unexpected development. The association and Union-I suggested that meetings at other branches be continued. Even though there was clear understanding that staff grievances and joint forum would be two separate entities and would not to be linked, the zonal manager wanted an early solution of the problem to avoid half-hearted resumption of meetings. The other two leaders agreed that the problem at this particular branch be resolved before resuming visits to other branches. The regional manager’s inquiries revealed that not many issues were pending. One bill of a clerk, which was pending for sanction for long time, was the main bone of contention. An emergency grievance-redressal meeting between Union-II and the branch manager guided by the zonal chief of personnel was held at the branch, and the branch manager solved all the pending issues. There were no pending grievances of the Union-I at this branch. This episode delayed branch meetings in Indore by 10 days. In one meeting with the zonal manager, Union-II promised to do everything to recover the lost time. The branch resumed the joint meeting after the grievances were redressed. The discussions were healthy and productive. They worked out a daily schedule for staff and officers to go out for canvassing business. Indore branches actively organized staff meetings, and consequently accelerated the collaboration climate in other branches.]

Threat of a Boycott

In the Gwalior branch, a cashier, who was stubborn, rigid and often irritating and was an ex-treasurer of Union-II, misbehaved with a senior-citizen customer. He used abusive language, shouted at him, and asked him to take away his account to some other bank. The cashier was suspended. The union put pressure for immediate re-instatement on the argument that they were being “extra co-operative” in business development. They were advised to keep business and dispute redressal separate. They persisted in their demand, but did not withdraw from the joint forum meetings at branches. The apex leaders of the union took up the matter for re-instatement. The regional manager offered to initiate the inquiry proceedings and have it completed in a short time if the suspended employee and the union co-operated. The union did not agree.

The union felt that its former office-bearer’s suspension would tarnish its reputation and it should do something to save its face. The regional manager of Raipur had organized a joint meeting as a mega function at Raipur one afternoon. The leaders of the unions/association arrived for the

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meeting. One of the joint secretaries of Union-II sought an emergency meeting at 2 p.m. with the zonal manager in Bhopal. At the meeting, he threatened that his union would withdraw from the function, where 100 employees were expected to meet, unless suspension of the cashier was not immediately lifted. The zonal manager spent two full hours persuading him not to do so. They explained how inappropriate it was to link the joint forum with the gross misconduct. He told him that such suspension could only be settled after the fast track departmental inquiry, for which already an offer was made.

The joint secretary informed that he was discussing the matter under the direction of his general secretary, who was sitting in Raipur threatening to withdraw from the function. As all arguments and logic failed, the zonal manager offered to talk to the general secretary on phone. He visited the general secretary that withdrawal was not in anybody’s interest. The business development strategy would backfire. And if the other union, the association, and the management continued their joint efforts, as they were keen to do so, the boycott would hurt only Union-II; it would risk isolation that it would not like. So it was best to keep the business objective separate from the disputes settlement as originally conceived by the forum. The big-brother advice worked. The joint secretary parted without any win–lose finish. The joint meeting at Raipur was held as scheduled at 5 p.m.

Another Bombshell

Despite these two episodes, the participative process continued. People’s participation was becoming more intense. The financial year had come to a close. Employee participation had contributed to excellent results in the zone. Employees and the unions/association deserved felicitations. Amidst this backdrop, a letter from the general secretary of Union-I was received. In his letter of 9 April 1996, he stated that he proposed to disassociate from the joint forum. He requested “to invite us for such meetings separately, being the recognized union of the esteemed bank.” This letter was received soon after releasing the April 1996 joint declaration letter. One likely cause could have been that members of Union I had not liked the general secretary becoming a party to exhort them to be disciplined, punctual, do whole day’s work, and do extra work beyond the departmental work. Another analysis suggested that Union-I wanted special attention and status in the joint forum, as the general secretary had asked for separate business development meetings for his union. Being the recognized union, he wanted to be treated better. Both the analyses were discussed with the general secretaries of the Union-II/Association. They were not able to throw any light on why Union-I walked out of the forum. However, there was consensus that without Union-I, the forum would collapse.

The zonal manager sought an appointment with the general secretary of the Union-I in his office in Indore. The zonal manager suggested to the general secretaries of Union II/association to accompany him in a deputation to the meeting. The suggestion was welcomed. Because of non-availability of the general secretary of the association on the appointment date, the treasurer of the association accompanied the deputation. They arrived at 3.00 p.m. on 17 th April 1996 in the Union-I office in Indore. The general secretary of the Union-I and his colleagues were surprised to see the joint forum members. The zonal manager explained the purpose of their visit. He, on behalf of the joint forum, enquired why he was parting their company. The deputation repeatedly inquired the reason and expressed their keen desire several times to have him back in the forum. However, he kept smiling and was unwilling to discuss the matter. The deputation kept up its persuasion effort and asked him for assessment of the working of the joint forum. He expressed his satisfaction and said that the results were encouraging and desirable. The deputation was with him for over three hours.

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The members argued that for the sake of progress of the Madhya Pradesh zone and prosperity and happiness of the staff of the zone they should work together. Frustrated, the association representative said that if the forum failed and the zone suffered the blame would lie on the general secretary of the recognized union and no one else.

The general secretary of Union-I was not only under heavy pressure from the deputation but also his own colleagues, who were nodding and signaling to him to be considerate, though they were not participating in the discussion. At the end, he opened up. He said that the grievances of his staff members at the branches were not being attended by branch managers who were busy in business activity. He expressed that his members were criticizing him. The deputation asked whether there were any more reasons for the withdrawal. He gave no other reason. The zonal manager sympathized with him and promised that he would give top priority to redressing the grievances in the zone. The others on deputation also shared the feelings and complaints of the general secretary of Union-I. The zonal manager stated that he would organize seminars for his branch managers to sharpen their skills for quicker disposal of grievances. Finally, the general secretary of Union-I said: “My letter stands withdrawn, and I will attend the joint forum meetings.” It was decided that the next joint forum meeting would include a small function to celebrate the excellent performance of the zone for the year 1995-96.

MOVING OVER

The general secretary of Union-I invited the zonal manager for dinner the same evening at a restaurant. Some of his union colleagues also attended. The problem-solving process also contributed significantly to institutionalizing the process of co-operation and collaboration. It kept the process on and integrated. As it happened, a few days later, the zonal manager was transferred to the corporate office in Mumbai. The new zonal manager said at widely attended function that he too believed in participative management and promised to carry forward his predecessor’s effort. He focused his efforts on same objectives.

Notes

1. ‘House-Keeping’ in banking context is the periodic balancing of accounts of the customers, inter-branch accounts and inter-bank payments and settlements. It is most important internal control system giving signal to customer that his interests are protected by his bank. In many banks the house-keeping position had been in heavy arrears and RBI directed immediate measures to be taken.

2. Staff Incentive Scheme of the bank was designed with full support of the unions/association. Introduced many years ago, it provided many years ago, it provided for individual awards at the zonal level for excelling in mobilization of savings bank, term deposits, and total deposits. Under the scheme, apart form honouring the winner with medal and certificate, incentive tour to a place of his/her choice for self and spouse with a prescribed expense limit and special leave for seven days was provided. Under the scheme, all India level awards were also given.

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You may focus on the following questions during the presentation:

1. Explain the sequence of the case.

2. How does strategic HRM discourse explain an impressive degree of collaboration between the two rival unions, the officers’ association and the management, and their coming together on the contentious issue of workers participation in Management?

3. What role does leadership play in fostering a participatory culture? Comment on the leadership style of the BOB zonal manager in this regard?

4. Is the enthusiasm shown by the collaborating partners going to be short-lived and confined only to BOB or can it become a way of work life of Madhya Pradesh (MP) zone of Bank of Baroda (BOB) and also be replicated elsewhere in public systems?

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