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TRAINING AND DEVELOPMENT is a subsystem of an organization. It ensures that randomness is reduced and learning or

behavioral change takes place in structured format.

TRADITIONAL AND MODERN APPROACH OF TRAINING AND DEVLOPMENT

Traditional Approach ± Most of the organizations before never used to believe in training. They were holding the

traditional view that managers are born and not made. There were also some views that training is a very costly affair and

not worth. Organizations used to believe more in executive pinching. But now the scenario seems to be changing.

Them

odern approach of training and development is that Indian Organizations have realized the importance of corporate training. Training is now considered as more of retention tool than a cost. The training system in Indian Industry

has been changed to create a smarter workforce and yield the best results

TRAINING AND DEVELOPMENT OBJECTIVES

The principal objective of training and development division is to make sure the availability of a skilled and willing workforce

to an organization. In addition to that, there are four other objectives: Individual, Organizational, Functional, and Societal.

Individual Objectives ± help employees in achieving their personal goals, which in turn, enhances the individual

contribution to an organization.

Organizational Objectives ± assist the organization with its primary objective by bringing individual effectiveness.

Functional Objectives ± maintain the department¶s contribution at a level suitable to the organization¶s needs.

Societal Objectives ± ensure that an organization is ethically and socially responsible to the needs and challenges of the

society.

TRAINING DEFINED

It is a learning process that involves the acquisition of knowledge, sharpening of skills, concepts, rules, or changing of attitudes and behaviours to enhance the performance of employees.

Training is activity leading to skilled behavior.

y It¶s not what you want in life, but it¶s knowing how to reach it

y It¶s not where you want to go, but it¶s knowing how to get there

y It¶s not how high you want to rise, but it¶s knowing how to take off

y It may not be quite the outcome you were aiming for, but it will be an outcome

y It¶s not what you dream of doing, but it¶s having the knowledge to do it

y It's not a set of goals, but it¶s more like a vision

y It¶s not the goal you set, but it¶s what you need to achieve it

Training is about knowing where you stand (no matter how good or bad the current situation looks) at present, andwhere you will be after some point of time.

Training is about the acquisition of knowledge, skills, and abilities (KSA) through professional development.

ROLE OF TRAINING



Importance Of Training and Development

y Optimum Utilization of Human R esources ± Training andDevelopment helps in optimizing the utilization of human resourcethat further helps the employee to achieve the organizationalgoals as well as their individual goals.

y Development of Human R esources ± Training andDevelopment helps to provide an opportunity and broad structurefor the development of human resources¶ technical and behavioralskills in an organization. It also helps the employees in attainingpersonal growth.

y Development of skills of employees ± Training andDevelopment helps in increasing the job knowledge and skills of employees at each level. It helps to expand the horizons of

human intellect and an overall personality of the employees.

y Productivity ± Training and Development helps in increasing the productivity of the employees that helps theorganization further to achieve its long-term goal.

y Team spirit ± Training and Development helps in inculcating the sense of team work, team spirit, and inter-teamcollaborations. It helps in inculcating the zeal to learn within the employees.

y

Organization Culture ± Training and Development helps to develop and improve the organizational health cultureand effectiveness. It helps in creating the learning culture within the organization.

y Organization Climate ± Training and Development helps building the positive perception and feeling about theorganization. The employees get these feelings from leaders, subordinates, and peers.

y Quality ± Training and Development helps in improving upon the quality of work and work-life.

y Healthy work environment ± Training and Development helps in creating the healthy working environment. Ithelps to build good employee, relationship so that individual goals aligns with organizational goal.

y Health and Safety ± Training and Development helps in improving the health and safety of the organization thuspreventing obsolescence.



y Morale ± Training and Development helps in improving the morale of the work force.

y Image ± Training and Development helps in creating a better corporate image.

y Profitability ± Training and Development leads to improved profitability and more positive attitudes towards profitorientation.

y Training and Development aids in organizational development i.e. Organization gets more effective decision makingand problem solving. It helps in understanding and carrying out organisational policies

y Training and Development helps in developing leadership skills, motivation, loyalty, better attitudes, and otheraspects that successful workers and managers usually display.

Training objectives are one of the most important parts of training program. While some people think of trainingobjective as a waste of valuable time. The counterargument here is that resources are always limited and the trainingobjectives actually lead the design of training. It provides the clear guidelines and develops the training program inless time because objectives focus specifically on needs. It helps in adhering to a plan.

Training objective tell the trainee that what is expected out of him at the end of the training program. Trainingobjectives are of great significance from a number of stakeholder perspectives,

1. Trainer2. Trainee3. Designer4. Evaluator

Trainer ± The training objective is also beneficial to trainer because it helps the trainer to measure the progress of trainees and make the required adjustments. Also, trainer comes in a position to establish a relationship betweenobjectives and particular segments of training.

Trainee ± The training objective is beneficial to the trainee because it helps in reducing the anxiety of the trainee up tosome extent. Not knowing anything or going to a place which is unknown creates anxiety that can negatively affectlearning. Therefore, it is important to keep the participants aware of the happenings, rather than keeping it surprise.

Secondly, it helps in increase in concentration, which is the crucial factor to make the training successful. The objectivescreate an image of the training program in trainee¶s mind that actually helps in gaining attention.

Thirdly, if the goal is set to be challenging and motivating, then the likelihood of achieving those goals is much higher thanthe situation in which no goal is set. Therefore, training objectives helps in increasing the probability that the participantswill be successful in training.



Designer ± The training objective is beneficial to the training designer because if the designer is aware what is to beachieved in the end then he¶ll buy the training package according to that only. The training designer would then look for thetraining methods, training equipments, and training content accordingly to achieve those objectives. Furthermore, planningalways helps in dealing effectively in an unexpected situation. Consider an example; the objective of one training programis to deal effectively with customers to increase the sales. Since the objective is known, the designer will design a

training program that will include ways to improve the interpersonal skills, such as verbal and non verbal language,dealing in unexpected situation i.e. when there is a defect in a product or when a customer is angry.Therefore, without any guidance, the training may not be designed appropriately.

Evaluator ± It becomes easy for the training evaluator to measure the progress of the trainees because the objectivesdefine the expected performance of trainees. Training objective is an important to tool to judge the performance of

participants.

Models of Training

Training is a sub-system of the organization because the departmentssuch as, marketing & sales, HR, production, finance, etc depends ontraining for its survival. Training is a transforming process thatrequires some input and in turn it produces output in the form of knowledge, skills, and attitudes (KSAs).

THE TRAINING SYSTEM

A System is a combination of things or parts that must work together to

perform a particular function. An organization is a system and trainingis a sub system of the organization.

The System Approach views training as a sub system of anorganization. System Approach can be used to examine broad issueslike objectives, functions, and aim. It establishes a logical relationship

between the sequential stages in the process of training need analysis (TNA), formulating, delivering, and evaluating.

There are 4 necessary inputs i.e. technology, man, material, time required in every system to produce products orservices. And every system must have some output from these inputs in order to survive. The output can be tangibleor intangible depending upon the organization¶s requirement. A system approach to training is planned creation of training program. This approach uses step-by-step procedures to solve the problems. Under systematic approach,training is undertaken on planned basis. Out of this planned effort, one such basic model of five steps is system

model that is explained below.

Organization are working in open environment i.e. there are some internal and external forces, that poses threatsand opportunities, therefore, trainers need to be aware of these forces which may impact on the content, form, andconduct of the training efforts. The internal forces are the various demands of the organization for a better learningenvironment; need to be up to date with the latest technologies.

The three model of training are:

1. System Model

2. Instructional System Development Model

3. Transitional model

Systematic Model Training

The system model consists of five phases and should be repeated on a regular basis to make furtherimprovements. The training should achieve the purpose of helping employee to perform their work torequired standards. The steps involved in System Model of training are as follows:

1. Analyze and identify the training needs i.e. to analyze the department, job, employeesrequirement, who needs training, what do they need to learn, estimating training cost, etc The nextstep is to develop a performance measure on the basis of which actual performance would beevaluated.

2. Design and provide training to meet identified needs. This step requires developing objectives of training, identifying



the learning steps, sequencing and structuring the contents.

3. Develop- This phase requires listing the activities in the training program that will assist theparticipants to learn, selecting delivery method, examining the training material, validating informationto be imparted to make sure it accomplishes all the goals & objectives.

4. Implementing is the hardest part of the system because one wrong step can lead to the failure of whole training program.

5. Evaluating each phase so as to make sure it has achieved its aim in terms of subsequent workperformance. Making necessary amendments to any of the previous stage in order to remedy orimprove failure practices.

I nstructional System Development model or ISD training model was made to answer thetraining problems. This model is widely used now-a-days in the organization because it isconcerned with the training need on the job performance. Training objectives are defined onthe basis of job responsibilities and job description and on the basis of the defined objectivesindividual progress is measured. This model also helps in determining and developing thefavorable strategies, sequencing the content, and delivering media for the types of trainingobjectives to be achieved.

The Instructional System Development model comprises of five stages:

1. ANALYSIS ± This phase consist of training need assessment, job analysis, and targetaudience analysis.

2. PLANNING ± This phase consist of setting goal of the learning outcome, instructional objectivesthat measures behavior of a participant after the training, types of training material, mediaselection, methods of evaluating the trainee, trainer and the training program, strategies to impartknowledge i.e. selection of content, sequencing of content, etc.



3. DEVELOPMENT ± This phase translates design decisions into training material. It consists of developing course material for the trainer including handouts, workbooks, visual aids, demonstrationprops, etc, course material for the trainee including handouts of summary.

4. EXECUTION ± This phase focuses on logistical arrangements, such as arranging speakers,equipments, benches, podium, food facilities, cooling, lighting, parking, and other training accessories.

5. EVALUATION ± The purpose of this phase is to make sure that the training program has achievedits aim in terms of subsequent work performance. This phase consists of identifying strengths andweaknesses and making necessary amendments to any of the previous stage in order to remedy orimprove failure practices.

The I SD model is a continuous process that lasts throughout the training program. It also highlightsthat feedback is an important phase throughout the entire training program. In this model, the outputof one phase is an input to the next phase.

Transitional model focuses on the organization as a whole. The outer loop describes thevision, mission and values of the organization on the basis of which training model i.e. innerloop is executed.

Vision ± focuses on the milestones that the organization would like to achieve after thedefined point of time. A vision statement tells that where the organization sees itself few yearsdown the line. A vision may include setting a role mode, or bringing some internaltransformation, or may be promising to meet some other deadlines.

Mission ± explain the reason of organizational existence. It identifies the position in the

community. The reason of developing a mission statement is to motivate, inspire, and informthe employees regarding the organization. The mission statement tells about the identity thathow the organization would like to be viewed by the customers, employees, and all otherstakeholders.

Values ± is the translation of vision and mission into communicable ideals. It reflects thedeeply held values of the organization and is independent of current industry environment. Forexample, values may include social responsibility, excellent customer service, etc.



The mission, vision, and values precede the objective in the inner loop. This model considers theorganization as a whole. The objective is formulated keeping these three things in mind and thenthe training model is further implemented.

There are various methods of training, which can be divided in to cognitive and

behavioral methods. Trainers need to understand the pros and cons of each method,also its impact on trainees keeping their background and skills in mind before givingtraining.

Cognitive methods are more of giving theoretical training to the trainees. The variousmethods under Cognitive approach provide the rules for how to do something, written orverbal information, demonstrate relationships among concepts, etc. These methods areassociated with changes in knowledge and attitude by stimulating learning.

The various methods that come under Cognitive approach are:

LECTURES

DEMONSTRATIONS

DISCUSSIONS

COMPUTER BASED TRAINING (CBT)



o INTELLEGENT TUTORIAL SYSTEM(ITS)

o PROGRAMMED INSTRUCTION (PI)

o VIRTUAL REALITY

Behavioral methods are more of giving practical training to the trainees. The variousmethods under Behavioral approach allow the trainee to behavior in a real fashion. Thesemethods are best used for skill development.

The various methods that come under Behavioral approach are:

GAMES AND SIMULATIONS

o BEHAVIOR-MODELING

o BUSINESS GAMES

o CASE STUDIES

o EQUIPMENT STIMULATORS

o IN-BASKET TECHNIQUE

o ROLE PLAYS

Both the methods can be used effectively to change attitudes, but through different means.

Another Method is MANAGEMENT DEV

EL

OPMENT METHOD ±

MANAGEMENT DEVELOPMENT ±

The more future oriented method and more concerned with education of the employees. Tobecome a better performer by education implies that management development activitiesattempt to instill sound reasoning processes.

Management development method is further divided into two parts:

ON THE JOB TRAINING ±

The development of a manager's abilities can take place on the job. The four techniques for



on the job development are:

y COACHING

y MENTORING

y JOB ROTATION

y JOB INSTRUCTION TECHNIQUE (JIT)

OFF THE JOB TRAINING ±

There are many management development techniques that an employee can take in off the job. The few popular methods are:

SENSITIVITY TRAINING

TRANSACTIONAL ANALYSIS

STRAIGHT LECTURES/ LECTURES

SIMULATION EXERCISES

CASE STUDY

Staffing Function of Management

The managerial function of staffing involves manning the organization structure through proper and effectiveselection, appraisal and development of the personnels to fill the roles assigned to the employers/workforce.

According to Theo Haimann, ³Staffing pertains to recruitment, selection, development and compensation of

subordinates.´

Nature of Staffing Function

1. Staffing is an important managerial function- Staffing function is the most important mangerial actalong with planning, organizing, directing and controlling. The operations of these four functionsdepend upon the manpower which is available through staffing function.

2. Staffing is a pervasive activity- As staffing function is carried out by all mangers and in all types of concerns where business activities are carried out.

3. Staffing is a continuous activity- This is because staffing function continues throughout the life of anorganization due to the transfers and promotions that take place.

4. The basis of staffing function is efficient management of personnels- Human resources can be



efficiently managed by a system or proper procedure, that is, recruitment, selection, placement,training and development, providing remuneration, etc.

5. Staffing helps in placing right men at the right job. It can be done effectively through proper recruitment procedures and then finally selecting the most suitable candidate as per the jobrequirements.

6. Staffing is performed by all managers depending upon the nature of business, size of the company,qualifications and skills of managers,etc. In small companies, the top management generally performsthis function.In medium and small scale enterprise, it is performed especially by the personneldepartment of that concern.

Staffing Process - Steps involved in Staffing

1. Manpower requirements- The very first step in staffing is to plan the manpower inventory required bya concern in order to match them with the job requirements and demands. Therefore, it involvesforecasting and determining the future manpower needs of the concern.

2. Recruitment- Once the requirements are notified, the concern invites and solicits applicationsaccording to the invitations made to the desirable candidates.

3. Selection- This is the screening step of staffing in which the solicited applications are screened outand suitable candidates are appointed as per the requirements.

4. Orientation and Placement- Once screening takes place, the appointed candidates are made familiar to the work units and work environment through the orientation programmes. placement takes placeby putting right man on the right job.

5. Training and Development- Training is a part of incentives given to the workers in order to developand grow them within the concern. Training is generally given according to the nature of activities andscope of expansion in it. Along with it, the workers are developed by providing them extra benefits of indepth knowledge of their functional areas. Development also includes giving them key and important

jobsas a test or examination in order to analyse their performances.6. Remuneration- It is a kind of compensation provided monetarily to the employees for their work

performances. This is given according to the nature of job- skilled or unskilled, physical or mental, etc.Remuneration forms an important monetary incentive for the employees.

7. Performance Evaluation- In order to keep a track or record of the behaviour, attitudes as well asopinions of the workers towards their jobs. For this regular assessment is done to evaluate andsupervise different work units in a concern. It is basically concerning to know the development cycleand growth patterns of the employeesin a concern.

8. Promotion and transfer- Promotion is said to be a non- monetary incentive in which the worker isshifted from a higher job demanding bigger responsibilities as well as shifting the workers and

transferring them to different work units and branches of the same organization.

Performance feedback enables companies to assess the performance of employees. There

exist different forms of feedback. Companies can either implement internal feedback measures

or hire an external consulting company to gather and analyze the performance feedback.

Companies can collect formal and informal feedback. Peers, managers and external customers

can provide feedback on employees. Direct reports can also provide feedback on their

managers to determine the managers' effectiveness and overall management skill level.

Purpose

1. Performance feedback helps with the productivity of the workplace. Feedbackenables employees to understand the company's expectations of them. It also identifiesdevelopment areas the employee needs to work on to improve their performance. Withthis information, employees have the information necessary to improve their job performance and stay motivated.

Process

2. When gathering performance feedback, companies should coach the evaluators



providing the feedback. They will need to ensure that the feedback they providecontains accurate details related specifically to the employee's job performance. Theyshould understand to omit any personal views or observations not associated with theemployee's job. Organizations should make a point to provide feedback on a regular basis and often. This helps the employee to understand the issue and rectify anyproblems as soon as possible.

F ormal F eedback

3. The timeline on gathering performance feedback varies among companies. Formalfeedback gathering sessions can take place on a monthly, quarterly or annual reviewcycle. The company determines the timeline according to its performance managementplans. When a formal feedback session takes place, evaluators document the outcomeof the session. After completion, the documentation goes into the employee'spersonnel file.

Informal F eedback

4. Informal feedback often consists of conversations between the evaluator and the

employee. These sessions occur on a more regular basis than formal feedbacksessions. Peers can provide informal feedback in the form of peer rewards or a verbalacknowledgment. This form of feedback gives the employee an immediate sense of jobperformance and can help with employee motivation and accountability.

Measuring F eedback

5. To disseminate performance feedback to the executive team, the feedback dataundergoes a measurement process. Since feedback can exist formally and informally,the company determines what types of feedback to include in reports and analysis. For example, a company may choose to exclude peer reviews from feedback analysisreports. Measuring feedback offers a clear snapshot of the behavior within the

company and gaps in the performance of the entire workforce. This information helpsduring strategic planning and workforce management activities.

1. Effective feedback is specific, not general. (Say, "The report you turned in yesterday was well-written,understandable, and made your points about the budget very effectively." Don't say, "good report.")

2. Effective feedback always focuses on a specific behavior, not on a person or their intentions. (When youheld competing conversations during the meeting, when Mary had the floor, you distracted the people inattendance.)

3. The best feedback is sincerely and honestly provided to help. Trust me, people will know if they arereceiving it for any other reason.

4. Successful feedback describes actions or behavior that the individual can do something about.

5. Whenever possible, feedback that is requested is more powerful. Ask permission to provide feedback. Say,"I'd like to give you some feedback about the presentation, is that okay with you?"

6. Effective feedback involves the sharing of information and observations. It does not include advice unlessyou have permission or advice was requested.

7. Effective feedback is well timed. Whether the feedback is positive or constructive provide the information



as closely tied to the event as possible.

8. Effective feedback involves what or how something was done, not why. Asking why is asking people abouttheir motivation and that provokes defensiveness.

9. Check to make sure the other person understood what you communicated by using a feedback loop, suchas asking a question or observing changed behavior.

10. Effective feedback is as consistent as possible. If the actions are great today, they're great tomorrow. If the policy violation merits discipline, it should always merit discipline.

Rewards

To retain good staff and to encourage them to give of their best while at work requires attention to the financial

and psychological and even physiological rewards offered by the organization as a continuous exercise.

Basic financial rewards and conditions of service (e.g. working hours per week) are determined externally (bynational bargaining or government minimum wage legislation) in many occupations but as much as 50 per cent

of the gross pay of manual workers is often the result of local negotiations and details (e.g. which particular hours shall be worked) of conditions of service are often more important than the basics. Hence there is scope

for financial and other motivations to be used at local levels.

As staffing needs will vary with the productivity of the workforce (and the industrial peace achieved) so good personnel policies are desirable. The latter can depend upon other factors (like environment, welfare, employee

benefits, etc.) but unless the wage packet is accepted as 'fair and just' there will be no motivation.

Hence while the technicalities of payment and other systems may be the concern of others, the outcome of them

is a matter of great concern to human resource management.

Increasingly the influence of behavioral science discoveries are becoming important not merely because of thewidely-acknowledged limitations of money as a motivator, but because of the changing mix and nature of tasks

(e.g. more service and professional jobs and far fewer unskilled and repetitive production jobs).

The former demand better-educated, mobile and multi-skilled employees much more likely to be influenced bythings like job satisfaction, involvement, participation, etc. than the economically dependent employees of

yesteryear.

Hence human resource management must act as a source of information about and a source of inspiration for

the application of the findings of behavioral science. It may be a matter of drawing the attention of senior managers to what is being achieved elsewhere and the gradual education of middle managers to new points of

view on job design, work organization and worker autonomy.

The effective reward system

In order for a reward system to be effective, the rewards must hold some importance for the employees. If none of the

potential rewards holds any importance for an individual, it is most unlikely that they will provide the motivation to elicit the

desired performance from the worker. If the reward being offered is a new title, but the employee wants more

responsibility and greater visibility, the reward may be labeled unimportant and hence ineffective as a motivator to this

particular employee.



The reward system should offer flexibility for maximum effectiveness. That is, rather than being hard and fast, the options

of rewards should leave room for flexibility. Tailoring the reward to the individual goes a long way in motivating an

employee. This could be termed customizing the rewards. This, then, heightens the importance of the reward to the

individual and motivates better.

Rewards should be given with certain frequency. An example of this is the annual salary review. Each employee being

reviewed annually knows with certainty when to anticipate a reward -- that is, a raise. Understanding the frequency of the

rewards gives a measure of trust to the system. It makes the employees feel more confident in believing their good

performance will be adequately rewarded and will be done so on a timely basis.

The most effective reward system is visible. That is, all the employees understand the possible rewards which are

available. This can be likened to a carnival game where prizes are displayed around the game area. How disappointing it

is to succeed at the game and be handed a cheap plastic toy from beneath the counter. So, too, it is with staff members.

They need to know what "prizes" they are striving for and that they are indeed available. The rewards should be ever

visible. There should never be surprises pulled from beneath the counter.

In addition, the cost of the rewards in the system must be clearly understood. Each employee must know exactly what is

necessary in order to earn a specific reward. For instance, many companies have a raise scale known to all employees.

Average performance may warrant a 4 percent increase, above average a 6 percent increase and exceptional

performance may be rewarded with an 8 percent to 10 percent increase. In a reward system such as this, each employee

knows prior to the review what type of performance corresponds to the desired pay raise. The cost, if you will, is known to

the employee. (It might be pointed out that the manager's responsibility is to give the employee specific, measurable goals

to correspond to the appropriate performance level -- e.g. average, above average or exceptional.)

Extrinsic vs. intrinsic rewards

Two major types of rewards exist -- extrinsic and intrinsic. Extrinsic

rewards emanate from formal arrangements in the organization. Intrinsic rewards are inherent in the work itself.

Extrinsic rewards are easier to recognize. These include the raises, the titles, the larger offices and the move up the

corporate organization chart. Herzberg referred to this category of rewards as hygienes. His theory held that these are not

the true motivators of workers. Their absence, however, can diminish performance levels.

Herzberg proposed that the real motivators are the intrinsic rewards. These have a more long-term motivating effect onthe employee. The key intrinsic factors are the meaningfulness of the job, the responsibility and the results. The more

meaningful an employee sees the job, the more satisfaction is generated and hence more motivation. Likewise, the more

responsibility an individual has in the job, the better the feeling about oneself and one's job. Feedback is also important. It

can, however, be from oneself, a superior or a peer. An employee can see results and a job well done and gain

satisfaction. Hearing from another peer or superior that the job was well done further enhances the motivational effect and

the satisfaction in the job.



The manager can work with the intrinsic rewards to create a more meaningful system that motivates better than just

extrinsic rewards. Allowing the employee to learn a variety of skills in the position increases the meaningfulness of the job

In addition, increasing the significance of the task performed enhances meaningfulness. Allowing for more autonomy

gives the employee a sense of more responsibility and more control. Giving positive feedback is perhaps one of the best

rewards a manager can give. It definitely encourages continued good performance.

The most common rewards given in an organization are extrinsic. Most managers feel they are easier to administer.

These include pay, inventive systems, promotions and fringe benefits.

Pay may be either on an hourly basis or a salaried basis. In addition, the money may be distributed either over a period of

time or in a lump sum. That is, either as regular salary week to week or as a bonus.

Incentive systems can be very effective if they are administered correctly. Most importantly, the employee must clearly

recognize the relationship between the performance of the work and the reward. The performance must be measurable

and objective. (Subjective performance evaluations leave too much room for managerial manipulation. This, in turn,

reduces the reliability and trust level on the part of the employee thereby diminishing the system's effectiveness.)

Promotions are a well-known organizational reward in the traditional system. The new twists to the old are job posting and

career path planning. Formal planning of an employee's career path is an important addition to the annual review. It

dangles the proverbial carrot before the employee, but gives advance notice of the reward to be expected. Job posting

has been undertaken in many organizations to take some of the mystery out of promotions. This provides visibility of the

rewards -- i.e., job openings.

The move to provide a cafeteria-style fringe benefit program has resulted in more rewards being available. The mere

ability to choose what suits the individual provides a reward in itself. It is an added plus to an individual to be able to select

the reward most desired. Some employees may want life insurance rather than day care. Some may prefer dental

coverage rather than stock purchases. Each employee can choose the most meaningful reward and hence better

motivator.

Why reward?

An organization's reward system serves both internal and external functions. The internal benefits include increased job

performance, decreased absenteeism and decreased turnover. A good reward system motivates people to work harder.

Increased productivity, therefore, saves the organization money in both overtime and additional employees. Better

motivated employees have a lower absenteeism rate and remain in the job longer. These two conditions save the

organization's resources even more.

Externally, the organization is able to attract better people. Those seeing employment opportunities are more attracted to

an organization offering a better reward system. Then once in the organization, the reward system often determines if the

employee will stay and then ultimately, if he will perform.



Punishment, the opposite side of the coin from reward, is not as effective in evoking long-term changes in performance.

Numerous behavioral studies have proven that the use of positive rewards produces the desired results better than

punishment. Negative reinforcement tends to disrupt the behavior temporarily and may often have undesirable side

effects.

Rewards are an incentive to workers. The anticipation of the rewards, however, is the real incentive. It is this anticipation

that spurs employees on to perform in the ways which the organization rewards.

The distribution of rewards

Once a reward system is created, a determination must be made as how the rewards are to be distributed among the

employees. The distribution method should also be as well known to the employees as the rewards themselves. Rewards

may be distributed based upon equality, power, need or contribution.

Reward distribution based upon equality is quite common. Most cost of living increases are based on equality. That is,

everyone across the board in the organization generally receives the same percentage increase. A department bonus for

exceeding production quotas may result in each department employee receiving the same $50.

Distribution based upon power results in upper management's receiving a bigger share of the reward pie. In this

distribution method, those with the most power receive the most rewards. On an assembly line, the foreman (wielding

more power) may receive a larger bonus than the line workers being supervised by the foreman.

A distribution method based upon need is the least common. When it is used to distribute rewards, it is usually to bring

underpaid employees in line with a predetermined salary range. This may occur when an older employee falls beneath the

starting salary range for new hires.

Some rewards are distributed based upon the employee's contribution. This can often be seen in an organization's

incentive plans. A cost savings to the company of $10 million a year would result in a larger bonus to the creator than an

idea that saved the company only $200,000 a year. The contribution of one was clearly greater than the other and

rewards would be distributed accordingly under this method.

Flexibility in reward systems

It is critical that the manager learns to match an employee with an appropriate reward. The manager must, therefore, be

flexible when designing the reward system. There is no universal reward system that pleases all employees. Individual

needs and personalities must be taken into account when selecting an appropriate reward. A mismatch of employee and

reward is ineffective at best.

The reward system must be viewed as fair by the employees. This includes the rewards themselves and the distribution of

them. If an employee does not believe that good performance will actually result in the desired reward, then the system is

ineffective and may be deemed unfair.



Upper management often has direct control over many of the extrinsic rewards that can be offered employees. There may

be caps on raises, no profit-sharing plan or no dental plan available. Yet the manager has the ability to be most creative

(and most effective) by offering intrinsic rewards.

It is through the organization's reward system that good employees are attracted to the organization, decide to stay within

the organization and then consciously decide to perform well. Employees perform at the level at which the organization

rewards them.

Motivation

Motivation is the driving force which causes us to achieve goals. Motivation is said to be intrinsic or extrinsic. The term

is generally used for humans but, theoretically, it can also be used to describe the causes for animal behavior as well.

This article refers to human motivation. According to various theories, motivation may be rooted in a basic need to

minimize physical pain and maximize pleasure, or it may include specific needs such as eating and resting, or a desired

object, goal, state of being, ideal, or it may be attributed to less-apparent reasons such as altruism, selfishness, morality,

or avoiding mortality. Conceptually, motivation should not be confused with either volition or optimism.[1]

Motivation is

related to, but distinct from, emotion.

Motivation concepts

[edit] Intrinsic and extrinsic motivationIntrinsic motivation refers to motivation that is driven by an interest or enjoyment in the task itself, and exists

within the individual rather than relying on any external pressure.[2]

Intrinsic motivation has been studied bysocial and educational psychologists since the early 1970s. Research has found that it is usually associated with

high educational achievement and enjoyment by students. Explanations of intrinsic motivation have been givenin the context of Fritz Heider's attribution theory, Bandura's work on self-efficacy,

[3]and Deci and Ryan's

cognitive evaluation theory (see self-determination theory). Students are likely to be intrinsically motivated if they:

y attribute their educational results to internal factors that they can control (e.g. the amount of effort they put in),

y believe they can be effective agents in reaching desired goals (i.e. the results are not determined by luck),

y are interested in mastering a topic, rather than just rote-learning to achieve good grades.

See also Intrinsic motivation and the 16 basic desires theory below.

Extrinsic motivation comes from outside of the individual. Common extrinsic motivations are rewards likemoney and grades, coercion and threat of punishment. Competition is in general extrinsic because it encourages

the performer to win and beat others, not to enjoy the intrinsic rewards of the activity. A crowd cheering on theindividual and trophies are also extrinsic incentives.

Social psychological research has indicated that extrinsic rewards can lead to overjustification and a subsequentreduction in intrinsic motivation. In one study demonstrating this effect, children who expected to be (and were)

rewarded with a ribbon and a gold star for drawing pictures spent less time playing with the drawing materialsin subsequent observations than children who were assigned to an unexpected reward condition and to children

who received no extrinsic reward.[4]

Self-determination theory proposes that extrinsic motivation can be internalised by the individual if the task fitswith their values and beliefs and therefore helps to fulfill their basic psychological needs.



Incentive theoryA reward, tangible or intangible, is presented after the occurrence of an action (i.e. behavior) with the intent to

cause the behavior to occur again. This is done by associating positive meaning to the behavior. Studies showthat if the person receives the reward immediately, the effect would be greater, and decreases as duration

lengthens. Repetitive action-reward combination can cause the action to become habit. Motivation comes fromtwo sources: oneself, and other people. These two sources are called intrinsic motivation and extrinsic

motivation, respectively.

Applying proper motivational techniques can be much harder than it seems. Steven Kerr notes that whencreating a reward system, it can be easy to reward A, while hoping for B, and in the process, reap harmful

effects that can jeopardize your goals.[5]

A reinforcer is different from reward, in that reinforcement is intended to create a measured increase in the rateof a desirable behavior following the addition of something to the environment.

Motivation is a very important for an organization because of the following benefits it provides:-

1. Puts human resources into action

Every concern requires physical, financial and human resources to accomplish the goals. It is through motivation that thehuman resources can be utilized by making full use of it. This can be done by building willingness in employees to work. This

will help the enterprise in securing best possible utilization of resources.

2 . I mproves level of efficiency of employees

The level of a subordinate or a employee does not only depend upon his qualifications and abilities. For getting best of his

work performance, the gap between ability and willingness has to be filled which helps in improving the level of performance of

subordinates. This will result into-

a. Increase in productivity,b. Reducing cost of operations, and

c. Improving overall efficiency.3 . Leads to achievement of organizational goals

The goals of an enterprise can be achieved only when the following factors take place :-

a. There is best possible utilization of resources,b. There is a co-operative work environment,c. The employees are goal-directed and they act in a purposive manner,d. Goals can be achieved if co-ordination and co-operation takes place simultaneously which can be effectively done

through motivation.

4. Builds friendly relationship

Motivation is an important factor which brings employees satisfaction. This can be done by keeping into mind and framing an

incentive plan for the benefit of the employees. This could initiate the following things:

a. Monetary and non-monetary incentives,b. Promotion opportunities for employees,c. Disincentives for inefficient employees.

In order to build a cordial, friendly atmosphere in a concern, the above steps should be taken by a manager. This would help

in:

d. Effective co-operation which brings stability,e. Industrial dispute and unrest in employees will reduce,f. The employees will be adaptable to the changes and there will be no resistance to the change,



g. This will help in providing a smooth and sound concern in which individual interests will coincide with theorganizational interests,

h. This will result in profit maximization through increased productivity.

5 . Leads to stability of work force

Stability of workforce is very important from the point of view of reputation and goodwill of a concern. The employees can

remain loyal to the enterprise only when they have a feeling of participation in the management. The skills and efficiency of

employees will always be of advantage to employees as well as employees. This will lead to a good public image in the marke

which will attract competent and qualified people into a concern. As it is said, ³Old is gold´ which suffices with the role of

motivation here, the older the people, more the experience and their adjustment into a concern which can be of benefit to theenterprise.

From the above discussion, we can say that motivation is an internal feeling which can be understood only by manager since he is inclose contact with the employees. Needs, wants and desires are inter-related and they are the driving force to act. These needs can beunderstood by the manager and he can frame motivation plans accordingly. We can say that motivation therefore is a continuousprocess since motivation process is based on needs which are unlimited. The process has to be continued throughout.

We can summarize by saying that motivation is important both to an individual and a business. Motivation is important to an

individual as:

1. Motivation will help him achieve his personal goals.2. If an individual is motivated, he will have job satisfaction.

3. Motivation will help in self-development of individual.4. An individual would always gain by working with a dynamic team.

Similarly, motivation is important to a business as:

1. The more motivated the employees are, the more empowered the team is.2. The more is the team work and individual employee contribution, more profitable and successful is the business.3. During period of amendments, there will be more adaptability and creativity.4. Motivation will lead to an optimistic and challenging attitude at work place.

Welfare Measures

Employee welfare defines as ³efforts to make life worth living for workmen´. These efforts have their origin either in some

statute formed by the state or in some local custom or in collective agreement or in the employer¶s own initiative.

y To give expression to philanthropic and paternalistic feelings.

y To win over employee¶s loyalty and increase their morale.

y To combat trade unionism and socialist ideas.

y To build up stable labour force, to reduce labour turnover and absenteeism.

y To develop efficiency and productivity among workers.

y To save oneself from heavy taxes on surplus profits.

y To earn goodwill and enhance public image.

y To reduce the threat of further government intervention.

y To make recruitment more effective (because these benefits add to job appeal).

Principles of Employee Welfare Service

Following are generally given as the principles to be followed in setting up a employee welfare service:

y The service should satisfy real needs of the workers. This means that the manager must first determine what theemployee¶s real needs are with the active participation of workers.

y The service should such as can be handled by cafeteria approach. Due to the difference in Sex, age, marital status,number of children, type of job and the income level of employees there are large differences in their choice of aparticular benefit. This is known as the cafeteria approach. Such an approach individualises the benefit systemthough it may be difficult to operate and administer.

y The employer should not assume a benevolent posture.

y The cost of the service should be calculate and its financing established on a sound basis.

y There should be periodical assessment or evaluation of the service and necessary timely on the basis of feedback.



Types of Employee Welfare Services

¯ Safety Services

Prevention of accidents is an objective which requires o explanation.

The costs of accidents are enormous in suffering to the injured, in reduction or loss of earnings, in disabilities andincapacities which afflict those involved and in compensation, insurance and legal costs, in lost time, filling in reports andattending to enquiries, and in spoilage of materials, equipment and tools to management.

Accidents are the consequence of two basic factors: technical and human. Technical factors include all engineeringdeficiencies, related to plant, tools material and general work environment. Thus, for example, improper lighting, inadequateventilation, poor machine guarding and careless housekeeping are some hazards which may cause accidents. Human factorsinclude all unsafe acts on the part of employees. An unsafe act is usually the result of carelessness.

Young and new employees, because of their difficulty in adjusting to the work situation and to life in general, alsohave many more accidents than do old and nature workers.

The Phenomenon of Accident Proneness. Some persons believe wrongly in the theory that certain individuals areaccident prone, that is , they have some personality trait as opposed to some characteristic of the environment whichpredisposes them to have more accidents than others in work condition where the risk of hazards is equal to all.

Components of a Safety Service

Among the many components of a safety service the following have proved effective when applied in combination:

y Appointment of safety officer

In big organizations, the appointment of a safety officer to head

the safety department is a must. In small organizations, the personnel manager may look after the functions of thisdepartment. The head of the safety department, who is usually a staff man, is granted power to inspect the plant for unsafecondition, to promote sound safety practices (through posters an d safety campaigns), to make safety rules, and to reportviolations to the plant manager.

y

Support by line management

The head of the safety department, whether enjoying a staff or a

functional position, by himself, cannot make a plan safe. His appointment lulls line management into assuming that all itssafety problems have been solved.

y Elimination of hazards

Although complete elimation of all hazards is virtually an

impossibility but following steps can be taken to help reduce them:

y Job safety analysis

All job procedures and practices should be analysed by

an expert to discover hazards. he should then suggest changes in their motion patterns, sequence and the like.

y Placement

A poorly placed employee is more apt to incur injury

than a properly placed employee. Employees should be placed on jobs only after carefully estimating and considering the jobrequirements with those which the individual apparently possesses.



y Personal protective equipment

Endless variety of personal safety equipment is available

nowadays which can be used to prevent inju

y Safeguarding machinery

Guards must be securely fixed to all powerdriven

machinery.

y Materials handling

Though often ignored, the careless handling of heavy and

inflammable materials is an important source of several injuries and fire.

y Hand tools

Minor injuries often result from improperly using a good

tool or using a poorly designed tool. Therefore, close supervision and instruction should be given to the employees on theproper tool to use an the proper use of the tool.

y Safety training, education and publicity

Safety training is concerned with developing safety skills,

whereas safety education is concerned with increasing contest programmes, safety campaigns, suggestion awards, andvarious audiovisual aids can be considered as different forms of employee education.

y Safety inspection

An inspection by a trained individual or a committee to detect

evidence of possible safety hazards (such as poor lighting, slippery floors, unguarded machines, faulty electrical installations,poor work methods and disregard of safety rules) is a very effective device to promote safety.

Health Services

The prevention of accident constitutes only on segment of the function of employee maintenance. Another equallyimportant segment is the employee¶s general health, both physical and mental.

There are two aspects of industrial health services

1. Preventive2. Curative, the former consists of 3. pre-employment and periodic medical examination,4. removal or reduction of health hazards to the maximum extent possible,5. Surveillance over certain classes of workers such as women, young persons and persons exposed to special risks.

Counseling Services

An employee very often comes across problems which have emotional content. For example, he may be nearingretirement and feeling insecure or he may be getting promotion and feeling hesitant to shoulder increased responsibility orhe may be worried due to some family problem.



Employee Welfare in India

The chapter on the Directive Principles of State Policy in our Constitution expresses the need for labour welfare thus:

1. The State shall strive to promote the welfare of the people by securing and protecting as effectively as it may asocial order in which justice, social, economic and political, shall inform all the institutions of the national life.

2. The State shall, in particular, direct its policy towards securing:3. That the citizens, men and women equally, have the right to an adequate means of livelihood;4. That the ownership and control of the material resources are so distributed as to subserve the common good.

1. The State shall make provision for securing just and humane conditions of work and for maternity relief.

Factories Act, 1948

The principal Act to provide for various labour welfare measures in India is the Factories Act, 1948. The Act appliesto all establishments employing 10 or more workers where power is used and 20 or more workers where power is not used,and where a manufacturing process is being carried on.

Employee Welfare Officer

Section 49 of the factories act provides that in every factory wherein 500 or more workers are ordinarily employedthe employer shall appoint at least one welfare officer.

The welfare officer should possess; (i) a university degree; (ii) degree or diploma in social service or social work or

social welfare from a recognized institution; and (iii) adequate knowledge of the language spoken by the majority of theworkers in the area where the factory is situated.

¯ Supervision

¯ Counseling workers

¯ Advising management

¯ Establishing liaison with workers

¯ Working with management and workers to improve productivity.

¯ Working with outside public to secure proper enforcement of various acts.

Health of Employees

y Cleanliness. Every factory shall be kept clean by daily sweeping or washing the floors and work rooms and by usingdisinfectant where necessary.

y Disposal of wastes and effluents. Effective arrangements shall be made for the disposal of wastes and for makingthem innocuous.

y Ventilation and temperature. Effective arrangements shall be made for ventilation and temperature so as to providecomfort to the workers and prevent injury to their health.

y Dust and fume. Effective measures shall be taken to prevent the inhalation and accumulation of dust and fumes orother impurities at the work place.

y Artificial humidification. The State Government shall make rules prescribing standard of humidification and methodsto be adopted for this purpose.



y Overcrowding. There shall be in every work room of a factory in existence on the date of commencement of this actat least 9.9cubic meters and of a factory built after the commencement of this act at least 4.2 cubic meters of spacefor every employee.

y Lighting. The State Government may prescribe standards of sufficient and suitable lighting.

y Drinking Water. There shall be effective arrangement for wholesome drinking water for workers at convenientpoints.

y Latrines and urinals. There shall be sufficient number of latrines and urinals, clean, well-ventilated, convenientlysituated and built according to prescribed standards separately for male and female workers.

y Spittoons. There shall be sufficient number of spittoons placed at convenient places in the factory.

Safety of Employees

y Fencing of machinery. All dangerous and moving parts of a machinery shall be securely fenced. Screws, bolts andteeth shall be completely encased to prevent danger.

y Work on or near machinery in motion. Lubrication or other adjusting operation on a moving machinery shall be doneonly by a specially trained adult male worker.

y Employment of young persons on dangerous machines. No young person shall be allowed to work on any dangerousmachine (so prescribed by the state government) unless he is sufficiently trained or is working under the supervisionof knowledgeable person.

y Device for cutting off power. Suitable device for cutting of power in emergencies shall be provided.

y Hoists and lifts. These shall be made of good material and strength, thoroughly examined at least once in every six

months and suitably protected to prevent any person or thing from being trapped.

Welfare of Employees

Chapter V of the factories Act contains provisions about the welfare of employees. These are as follows:

y There shall be separate and adequately screened washing facilities for the use of male and female employees.

y There shall be suitable places provided for clothing not worn during working hours and for the dying of wet clothing.

y There shall be suitable arrangement for all workers to sit for taking rest if they are obliged to work in a standingposition.

y There shall be provided the required number of first-aid boxes or cupboard (at the rate of one for every 150workers) equipped with the prescribed contents readily available during the working hours of the factory.

y The State Government may make rules requiring that in any specified factory employing more than 250 employees acanteen shall be provided and maintained by the occupier for the use of the employee.

y There shall be provided sufficiently lighted and ventilated lunch room if the number of employees ordinarilyemployed is more than 150.

R estrictions in the Factories Act on the employment of young persons:

1. Prohibition as to employment of children (Section 67)

No child who has not completed his fourteenth year shall be required or allowed to work in any factory.

2. Employment of Children and Adolescent (Section 68)



A child who has completed his fourteenth year or an adolescent shall not be required or allowed to work in any factory unlessfollowing conditions are fulfilled:

1. The manager of the factory has obtained a certificate of fitness granted to such young2. While at work, such child or adolescent carries a token giving reference to such certificate.

3. Certificate of fitness (Section 69)

Before a young person is employed in the factory, a certifying surgeon has to certify that such person is fit for that work inthe factory.

Welfare Funds

In order to provide welfare facilities to the workers employed in mica, iron, ore, manganese ore and chrome ore,limestone and dolomite mines and in the beedi industry, the welfare funds have been established to supplement the effortsof the employers and the State Government under respective enactments.

The welfare measures financed out of the funds relate to development of medical facilities, housing, supply of drinking water, support for education of dependents and recreation, etc.

Voluntary Benefits

Benefits are also given voluntarily to workers by some progressive employers. These include loans for purchasinghouses and for educating children, leave travel concession, fair price shops for essential commodities and loans to buypersonal conveyance.

Machinery Connected with Employee Welfare Work

1. Chief inspector of Factories

It is the duty of the Chief inspector of factories (who generally works under the administrative control of the labourcommissioner in each state) to ensure enforcement of various provisions of Factories Act i8n respect of safety, heath andwelfare of workers.

2. Central Labour Institute

The institute was set up in Bombay in 1966 to facilitate the proper implementation of the Factories Act, 1948; to provide acentre of information for inspectors, employers, workers and others concerned with the well being of industrial labour and tostimulate interest in the application of the principles of industrial safety, health and welfare.

3. National Safety Council

The National Safety Council was wet up on 4th March, 1966 in Bombay at the initiative of the Union Ministry of Labour andRehabilitation, Government of India, as an autonomous national body with the objective of generating developing andsustaining an movement of safety awareness at the national level.

4. Director General of Mines Safety

The Director General of Mines Safety enforces the Mines Act, 1952. He inspects electrical installation and machineryprovided in the mines and determines the thickness of barriers of 2 adjacent mines in order to prevent spread of fire anddanger of inundation.

Appraisal of Welfare Services

1. One of the main obstacles in the effective enforcement of the welfare provisions of the Factories Act has been thequantitative and qualitative inadequacy of the inspection staff.

2. at present, a labour welfare officer is not able to enforce laws independently because he has to work under thepressure of management.

3. Women workers do not make use of the crèche facilities either because they are dissuaded by the management tobring their children with them or because they have to face transport difficulties.



National Commission on Employee R ecommendations

1. The statutory provisions on safety are adequate for the time being effective enforcement is the current need.2. Every fatal accident should thoroughly be enquired into and given wide publicity among workers.3. Employers should play a more concerted role in safety and accident prevention programme and in arousing safety

consciousness.4. Safety should become a habit with the employers and workers instead of remaining a mere ritual as at present.5. Unions should take at least as much interest in safety promotion as they take in claims for higher wages.

SOCIAL SECURITY

The connotation of the term ³Social Security´ varies form country to country with different political ideologies. Insocialist countries, the avowed goal is complete protection to every citizen form the cradle to the grave.

There are some components of Social Security:

y Medical care

y Sickness benefit

y Unemployment benefit

y Old-age benefit

y Employment injury benefit

y Family benefit

y Maternity benefit

y Invalidity benefit and

y Survivor¶s benefit

Social Securities may be of two types

1. Social assistance under which the State finances the entire cost of the facilities and benefits provided.2. Social insurance, under the State organizes the facilities financed by contributions form the workers and employers,

with or without a subsidy from the state.

Social Security in India

At present both types of social security schemes are in vogue in our country. Among the social assistance schemesare the most important.

The social insurance method, which has gained much wider acceptance than the social assistance method, consistsof the following enactments.

The workmen¶s Compensation Act, 1961.

The Employee¶s State Insurance Act, 1948.

The employees¶ State Insurance Act, 1948.

The Maternity Benefit Act, 1961.

Employees¶ compensation Act, 1923

a. Coverage. This Act covers all workers employed in factories, mines, plantations, transport undertakings, constructionworks, railways, ships, circus and other hazardous occupations specified in schedule II of the Act.

The Act empowers the State Government to extend the coverage of the Act by adding any hazardous occupation to the list ofsuch occupations is schedule II.

1. Administration. The Act is administered by the State Government which appoints Commissioners for this purposeunder sec. 20 of the Act.



2. Benefits. Under the Act, compensation is payable by the employer to a workman for all personal injuries caused tohim by accident arising out of and in the course of his employment which disable him for more than 3 days.

2. Employees¶ State Insurance Act, 1948

1. Other than seasonal factories, run with power and employing 20 or more workers.2. Administration. The Act is administered by the ESI corporation, an autonomous body consisting of representatives

of the Central and State Governments, employers, employees, medical profession and parliament.3. Benefits. The Act, which provides for a system of compulsory insurance, is a landmark in the history of social

security legislation in India.

1. Medical Benefit. An insured person or (where medical benefit bas been extended to his family) a memberof his family who requires medical treatment is entitled to receive medical benefit free of charge.

2. Sickness Benefit. An insured person, when he is sick, is also entitled to get sickness benefit at thestandard benefit rate corresponding to his average daily wage.

3. An insured woman is entitled to receive maternity benefit (which is twice the sickness benefit rate) for alldays on which she does not work for remaining during a period of 12 weeks of which not more than 6 weeksshall precede the expected date of confinement.

4. The Act makes a three-fold classification of injuries in the same way as is done in the workmen¶scompensation Act.

5. Dependant¶s Benefit. If an insured person meets with an accident in the course of his employment andies as a result thereof, his dependants, i.e. his widow, legitimate or adopted sons and legitimate unmarrieddaughters get this benefit.

3. The Maternity Benefit Act, 1961

Maternity benefit is one of the important benefits provided under the

Employees State Insurance Act, 1948. Another important legislation in this respect is the Maternity Benefit Act, 1961. TheAct covers only those persons who are not covered by the Employees State Insurance Act. The Act entitles a womanemployee to claim maternity leave from her employer if she has actually worked for a period of at least 160 days in the 12months immediately proceeding the day of her expected delivery.

The act further provides for the payment of medical bonus of Rs. 250

to the confined woman worker.

The committee on the status of women in India 1974 has, there fore,

recommended the following changes in the Act:

1. The administration of the fund should follow the pattern already established by the ESIC.2. For casual labour a minimum of 3 months of service should be considered as qualification service for this benefit.3. This will provide greater incentive to women workers to participate in trade union activities.

1. The Payment of Gratuity Act, 1972

1. Coverage. The Act applies to every factory, mine, oilfield, plantation, port and railway company and to every shopor establishment in which 10 or more persons are employed, or were employed, on any day of the preceding 12months.

2. Administration. The Act is administered by a controlling authority appointed by the appropriate Government.

3. Benefits. Under the Act gratuity is payable to an employee on the termination of his employment after he hasrendered continuous service for not less than five years. The completion of continuous service of five years is, however, not necessary where the termination of the employment is due to death or disablementGratuity is payable atthe rate of 15 days¶ wages based on the rate of wages last drawn by the employee for every complete year of service or part thereof in excess of six months. But the amount of gratuity payable to an employee shall not exceedRs. 3.5 lakh.

4. Source of Funds. Under the Act gratuity is payable entirely by the Employer. For this purpose is required either (i)to obtain insurance with the Life Insurance Corporation, or (ii) to establish a gratuity fund. Thus it is his liability topay the premium in the first case to make the contribution in the second case.



Organisational communication

Organizational communication refers to the study of how people communicate within an organizational context.

Organisations can not operate without communication. Communication can take various forms but all

forms involve the transfer of information from one party to the other. In order for the transfer of

information to qualify as communication, the recipient must understand the meaning of the information

transferred to them. If the recipient does not understand the meaning of the information conveyed to them,

communication has not taken place.

Communication is the life source of organisations because organisations involve people. People cannot

interact with each other without communication. In the absence of communication, everything would grind

to a halt. For example;

The workers in an organisation would not know the organisation¶s objectives so they would not strive to

achieve the organisation¶s objectives.

y The workers in an organisation would not know what their roles and responsibilities were, so they

would not be able to carry out their daily tasks and duties.y The managers would not be able to train their workers reports so the workers would not possess the

skills they needed to carry out their jobs.

y The managers would not be able to inform workers of changes

y The organisation would not be aware of their competitors activities

And the list is endless«««««..

On the whole people are able to communicate with each other as this is a basic human function. However successful organisations strive not only for communication but effective communication.

Interpersonal Communication

This is defined as communication between two or more people and involves the transfer of information (or

message) from one person to the other(s). The person transferring the information is called the sender or

transmitter. The people receiving the message are known as receivers. The transmitter will need to send the

information in a format that the receiver(s) will understand. Converting the information into a format that

the receivers will understand is known as Encoding.

Messages can be encoded into a variety of formats oral, written or visual. After encoding the message istransferred via a medium called a channel, for example a letter, fax, phone call, or e-mail. After

transference the information will need to be interpreted by the receiver. This process of interpretation is

known as decoding. Finally the receiver will send a message back to the transmitter confirming whether the

information sent has been understood. This back check is known as feedback.

The communication process involves seven key elements as illustrated in the diagram below.



Barriers to effective Communication (leaky bucket)

At each stage in the process encoding, transference, and decoding there is the possibility of interference

which may hinder the communication process. This interference is known as noise. Often a comparison is

made between communication and a leaky bucket. If you use a leaky bucket to carry water, water will be

lost at various points in your journey from the water tap to your destination. It is not possible to stop losing

water because the bucket contains holes. The amount of water you will lose will be determined by the

number of holes in the bucket, the size of the holes, the route you take to your final destination and length

of time it takes you to get to your destination. There may also be other events that occur during your

journey which increase the amount of water lost.Similarly when information is transferred from the

transmitter to the receiver not all of the information may be received by the receiver because of holes called

noise. Each of the noise may be affect the amount of information transferred. Just as in a leaky bucket,

more holes decrease the amount of water, more noise decreases the amount of correct information received.

Noise can take a variety of forms including

Language issues and Cultural Differences : the receiver(s) may not (fully) understand the language used

by the transmitter. This may occur if the transmitter¶s language is foreign to the receiver. There may also be

language problems (that the communication process) if the message contains technical information and the

receiver¶s is not familiar with the technical terms used. Cultural differences created by an individual¶s

background and experience affect their perception of the world. Such cultural differences may affect the

interpretation (decoding) of the message sent.

Environmental issues: If the environment that the transmitter or receiver are in, is noisy and full of sound,

the sounds may prevent the message being fully understood. Background noise is often created bycolleagues or machinery.

Channel issues: If the channel used to transfer the information is poor it may prevent all or some of the

information being transferred. Examples include a faulty fax machine, a crackling phone, handwriting that

cannot be read or in the case of oral messages incorrect facial gestures.

Receivers Attitude and behaviour: If the receiver(s) is not interested in the message (or unable to give



their full attention to decoding) this may reduce the amount of information received or the accuracy of the

information transmitted to them. Similarly the receiver(s) may misinterpret the message by "jumping to

conclusions" or reading the message in a manner that suits their own interests/objectives and distort the true

meaning of the message.

Transmission journey :i.e. steps in the message, If the message is complicated or there are lots of steps

taken to transfer the message it may affect the accuracy or interpretation. Comparing with the leaky bucket

if the leaky bucket has to carry water over a longer distance more water will probably lost than if the

journey was shorter.

Internal/Organisational Communication

This is communication that takes place within (or across) an organisation. In addition to the usual face to face,

telephone, fax or mail; modern organisations may use technology to communicate internally. Technology may be used for e-mails or a linked internal communication system such as the intranet which is an internet system

designed solely for use by those working for the organisation.

External communications

Conversely external communication is communication between the organisation and those outside theorganisation. Modern organisations may design technological systems so that they can communicate with

customers and undertake e-Commerce. Alternatively they communicate with other businessess through theinternet or similar systems and undertake e-Business.

Functions of Internal and External Communications;

Technology has rapidly expanded the types of internal and external communication available to organisations.

The diagram illustrates the vast array of internal and external communication available.

Combined together internal and external types of communications allow various sectors of the local, nationaland international community to interact, liaise and conduct business.



Formal and Informal Communications

Formal communication is defined as communication which occurs through the official organisational channels

or is undertaken by an employee to do their job. For example official meetings, letters and a manager asking anemployee to carry out a particular task. Conversely informal communication is that which occurs outside the

recognised communication networks such as talking in the lunchroom or hallways between employees. Informalcommunication can be productive or negative. It has the potential to build teams, improve working relationships

and generate ideas as employees are in a relaxed environment.

Upward and Downward Communications

Downward communication is communication created by directors and managers and passed down the hierarchyof workers in the organisation. In traditional organisations this is the preferred method of communication ie

Managers decide what the systems, rules and procedures will be and then they pass these down to employeesthey manage and supervise. Downward Communication can increase efficiency by synchronising organisational

procedures and can ensure that everybody is working towards the same overall aims and objectives. Types of downward communication include job descriptions, appraisals/evaluations, organisational policy, and

organisational systems.

Although there are advantages to downward communication organisations have began to encourage upwardcommunication. This is communication which originates at the lower level of the employment hierarchy and is

then communicated up through the line. Organisations encouraging upward communication believe thateverybody is capable of generating thoughts and ideas which may help the organisation to progress, particularly

when they are working closely in the area that the idea applies to. Upward communication may increasemotivation and make employees feel valued and respected whilst enabling managers to understand how

employees are feeling. Furthermore if problems occur at they are more likely to be identified earlier by thoseworking closely in the area that they occur. Types of upward communications include suggestion schemes,

feedback forums/surveys, grievance procedures and employee-manager discussions.

Lateral Communication

This is communication that occurs between employees on the same level in the organisation. As this can involve



decision making it can create efficiency as employees do not have to wait for managerial approval. On the otherhand if the manager is not kept informed or if the manager fails to set boundaries there is potential for conflict.

Diagonal Communication

This occurs when communication occurs between workers in a different section of the organisation and whereone of the workers involved is on a higher level in the organisation. For example in a bank diagonal

communication will occur when a department manager in head office converses with a cashier in a branch of the bank based on the high street.

Workers participation in management:

WORKERS¶ PARTICIPATION IN MANAGEMENT

Introduction:Three groups of managerial decisions affect the workers of any industrial establishment and hence the workers must have

a say in it.

o Economic decisions ± methods of manufacturing, automation, shutdown, lay-offs, mergers.

o Personnel decisions ± recruitment and selection, promotions, demotions, transfers, grievance settlement, work distribution.

o Social decisions ± hours of work, welfare measures, questions affecting work rules and conduct of individual worker¶ssafety, health, sanitation and noise control.

Participation basically means sharing the decision-making power with the lower ranks of the organization in an appropriate

manner.

Definitions:The concept of WPM is a broad and complex one.

Depending on the socio-political environment and cultural conditions, the scope and contents of participation change.

International Institute of Labour Studies: WPM is the participation resulting from the practices which increase the scope for

employees¶ share of influence in decision-making at different tiers of organizational hierarch with concomitant assumption of

responsibility.

ILO: Workers¶ participation, may broadly be taken to cover all terms of association of workers and their representatives

with the decision-making process, ranging from exchange of information, consultations, decisions and negotiations, to more

institutionalized forms such as the presence of workers¶ member on management or supervisory boards or evenmanagement by workers themselves as practiced in Yugoslavia.

Objectives:According to Gosep, workers¶ participation may be viewed as:

o An instrument for increasing the efficiency of enterprises and establishing harmonious relations;

o A device for developing social education for promoting solidarity among workers and for tapping human talents;

o A means for achieving industrial peace and harmony which leads to higher productivity and increased production;

o A humanitarian act, elevating the status of a worker in the society;

o An ideological way of developing self-management and promoting industrial democracy.

Other objectives of WPM can be cited as:

o To improve the quality of working life (QWL) by allowing the workers greater influence and involvement in work and

satisfaction obtained from work; and

o To secure the mutual co-operation of employees and employers in achieving industrial peace; greater efficiency andproductivity in the interest of the enterprise, the workers, the consumers and the nation.

The main implications of workers¶ participation in management as summarized by ILO:

o Workers have ideas which can be useful;

o Workers may work more intelligently if they are informed about the reasons for and the intention of decisions that are

taken in a participative atmosphere.

Importance:

Unique motivational power and a great psychological value.

Peace and harmony between workers and management.

Workers get to see how their actions would contribute to the overall growth of the company.

They tend to view the decisions as `their own¶ and are more enthusiastic in their implementation.



Participation makes them more responsible.

o They become more willing to take initiative and come out with cost-saving suggestions and growth-oriented ideas.

Scope and ways of participation:One view is that workers or the trade unions should, as equal partners, sit with the management and make joint

managerial decisions.

The other view is that workers should only be given an opportunity, through their representatives, to influence managerial

decisions at various levels.In practice, the participation of workers can take place by one or all the methods listed below:

o Board level participationo Ownership participation

o Complete control

o Staff or work councils

o Joint councils and committees

o Collective Bargaining

o Job enlargement and enrichment

o Suggestion schemes

o Quality circles

o Empowered teams

o TQM

o Financial participation

Participation at the Board level:This would be the highest form of industrial democracy.

The workers¶ representative on the Board can play a useful role in safeguarding the interests of workers.

He or she can serve as a guide and a control element.

o He or she can prevail upon top management not to take measures that would be unpopular with the employees.

o He or she can guide the Board members on matters of investment in employee benefit schemes like housing, and so forth.

The Government of India took the initiative and appointed workers¶ representatives on the Board of Hindustan Antibiotics

(Pune), HMT (Bangalore), and even nationalized banks.

The Tatas, DCM, and a few others have adopted this practice.

Problems associated with this method:

o Focus of workers¶ representatives is different from the focus of the remaining members of the Board.

o Communication and subsequently relations between the workers¶ representative and the workers suffers after the former

assumes directorship.

He or she tends to become alienated from the workers.o As a result, he or she may be less effective with the other members of the Board in dealing with employee matters.

o Because of the differences in the cultural and educational backgrounds, and differences in behaviour and manners, such an

employees¶ representative may feel inferior to the other members, and he or she may feel suffocated. Hence, his or her role

as a director may not be satisfying for either the workers or the management.

o Such representatives of workers¶ on the Board, places them in a minority. And the decisions of the Board are arrived at on

the basis of the majority vote.

Participation through ownership:This involves making the workers¶ shareholders of the company by inducing them to buy equity shares.

o In many cases, advances and financial assistance in the form of easy repayment options are extended to enable employees

to buy equity shares.

Examples of this method are available in the manufacturing as well as the service sector.

Advantage: o Makes the workers committed to the job and to the organization.

Drawback:

o Effect on participation is limited because ownership and management are two different things.

Participation through complete control:

Workers acquire complete control of the management through elected boards.

The system of self-management in Yugoslavia is based on this concept.

Self-management gives complete control to workers to manage directly all aspects of industries through their

representatives.Advantages:

o Ensures identification of the workers with their organization.



o Industrial disputes disappear when workers develop loyalty to the organization.

o Trade unions welcome this type of participation.

Conclusion: Complete control by workers is not an answer to the problem of participation because the workers do not

evince interest in management decisions.

Participation through Staff and Works Councils:Staff councils or works councils are bodies on which the representation is entirely of the employees.

There may be one council for the entire organization or a hierarchy of councils.

The employees of the respective sections elect the members of the councils.

Such councils play a

varied role.o Their role ranges from seeking information on the management¶s intentions to a full share in decision-making.

Such councils have not enjoyed too much of success because trade union leaders fear the erosion of their power and

prestige if such workers¶ bodies were to prevail.

Participation through Joint Councils and Committees:

Joint councils are bodies comprising representatives of employers and employees.

o This method sees a very loose form of participation, as these councils are mostly consultative bodies.

Work committees are a legal requirement in industrial establishments employing 100 or more workers.

o Such committees discuss a wide range of topics connected to labour welfare.

o Examples of such committees are welfare committee, safety committee, etc.

o Such committees have not proven to be too effective in promoting industrial democracy, increasing productivity and

reducing labour unrest.

Participation through Collective Bargaining:

Through the process of CB, management and workers may reach collective agreement regarding rules for the formulation

and termination of the contract of employment, as well as conditions of service in an establishment.Even though these agreements are not legally binding, they do have some force.

For CB to work, the workers¶ and the employers¶ representatives need to bargain in the right spirit.

But in practice, while bargaining, each party tries to take advantage of the other.

This process of CB cannot be called WPM in its strongest sense as in reality; CB is based on the crude concept of exercising

power for the benefit of one party.

o WPM, on the other hand, brings both the parties together and develops appropriate mutual understanding and brings about

a mature responsible relationship.

Participation through Job Enlargement and Job Enrichment:Excessive job specialization that is seen as a by-product of mass production in industries, leads to boredom and associated

problems in employees.

Two methods of job designing ± job enlargement and job enrichment± are seen as methods of addressing the problems.

o Job enlargement means expanding the job content ± adding task elements horizontally.

o Job enrichment means adding ̀ motivators¶ to the job to make it more rewarding.This is WPM in that it offers freedom and scope to thei workers to use their judgment.

But this form of participation is very basici as it provides only limited freedom to a worker concerning the method of

performing his/her job.

The worker has no say in other vital issues of concern to him ± issues such as job and income security, welfare schemes

and other policy decisions.

Participation through Suggestion Schemes:

Employees¶ views are invited and reward is given for the best suggestion. With this scheme, the employees¶ interest in the problems of the organization is aroused and maintained.

Progressive managements increasingly use the suggestion schemes.

Suggestions can come from various levels.

The ideas could range from changes in inspection procedures to design changes, process simplification, paper-work

reduction and the like.

o Out of various suggestions, those accepted could provide marginal to substantial benefits to the company.

The rewards given to the employees are in line with the benefits derived from the suggestions.

Participation through Quality Circles:

Concept originated in Japan in the early 1960s and has now spread all over the world.

A QC consists of seven to ten people from the same work area who meet regularly to define, analyze, and solve quality and



related problems in their area.

Training in problem-solving techniques is provided to the members.

QCs are said to provide quick, concrete, and impressive results when correctly implemented.

Advantages:

o Employees become involved in decision-making, acquire communication and analytical skills and improve efficiency of the

work place.

o Organization gets to enjoy higher savings-to-cost ratios.

o Chances of QC members to get promotions are enhanced.The Indian Scenario:

o Tried by BHEL

, Mahindra and Mahindra, Godrej and Boyce among others.o Experienced mixed results:

Mi&M (jeep division) with 76 QCs has experienced favourable results.

Technical problems got solved.

Workers got to get out of their daily routine and do something challenging.

Trade unions look at it as:i

A way of overburdening workers, and

An attempt to undermine their role.

These circles require a lot of time and commitment on the part of members for regular meetings, analysis, brainstorming,

etc.Most QCs have a definite life cycle ± one to three years.

o Few circles survive beyond this limit either because they loose steam or they face simple problems.

QCs can be an excellent bridge between participative and non-participative approaches.

For QCs to succeed in the long run, the management needs to show its commitment by implementing some of thesuggestions of the groups and providing feedback on the disposition of all suggestions.

Empowered Teams:

Empowerment occurs when authority and responsibility are passed on to the employees who then experience a sense of

ownership and control over their jobs.Employees may feel more responsible, may take initiative in their work, may get more work done, and may enjoy the work

more.

For empowerment to occur, the following approach needs to be followed as compared to the traditional approach:

Element Traditional Org. Empowered Teams

Organizational structure Layered, individual Flat, team

Job design Narrow, single task Whole process, multiple tasksManagement role Direct, control Coach, facilitate

Leadership Top-down Shared with the team

Information flow Controlled, limited Open, shared

Rewards Individual, seniority Team-based, skill-based

Job process Managers plan, control, improve Teams plan, control, improve

Features of empowered or self-directed teams:

o Empowered to share various management and leadership functions.

o Plan, control and improve their work.

o Often create their schedules and review their performance as a group.

o May prepare their own budgets and co-ordinate their work with other departments.

o Usually order materials, keep inventories and deal with suppliers.

o Frequently responsible for acquiring any new training they might need.o May hire their own replacement to assume responsibility for the quality of their products or services.

Titan, Reliance, ABB, GE Plastics (India), Wipro Corporation and Wipro InfoTech are empowering employees ± both

frontline as well as production staff, and are enjoying positive results.

Total Quality Management:

TQM refers to the deep commitment, almost obsession, of an organization to quality.

Every step in company¶s processes is subjected to intense and regular scrutiny for ways to improve it.

Some traditional beliefs are discarded.

o High quality costs more.

o Quality can be improved by inspection.

o Defects cannot be completely eliminated.



o Quality in the job of the QC personnel.

New principles of TQM are:

o Meet the customer¶s requirement on time, the first time, and 100% of the time.

o Strive to do error-free work.

o Manage by prevention, not correction.

o Measure the cost of quality.TQM is called participative because it is a formal programme involving every employee in the organization; making each

one responsible for improving quality everyday.

Financial Participation:This method involves less consultations or even joint decisions.

Performance of the organization is linked to the performance of the employee.

The logic behind this is that if an employee has a financial stake in the organization, he/she is likely to be more positively

motivated and involved.

Some schemes of financial participation:

o Profit-linked pay

o Profit sharing and Employees¶ Stock Option schemes.

o Pension-fund participation.

Pre-requisites for successful participation:

Management and operatives/employees should not work at cross-purposes i.e. they must have clearly defined and

complementary objectives.

Free flow of communication and information.Participation of outside trade union leaders to be avoided.

Strong and effective trade unionism.

Workers¶ education and training. Trade unions and government needs to work in this area.

Trust between both the parties.

Workers should be associated at all levels of decision-making.

Employees cannot spend all their time in participation to the exclusion of all other work.

Limitations of participation:

Technology and organizations today are so complex that specialized work-roles are required.

o This means employees will not be able to participate effectively in matters beyond their particular environment.

Everybody need not want participation.

The role of trade unions in promoting participative management has been far from satisfactory.

Employers are unwilling to share power with the workers¶ representatives. Managers consider participative management a fraud.

Evolution of participative management in India:The beginning towards WPM was made with the Industrial Disputes Act, 1947, which made Works Committees mandatory

in industrial establishments employing 100 or more workers.

The Industrial Policy Resolution adopted by the government in 1956 stated that there should be some joint consultation to

ensure industrial peace, and improve employer-employee relations.

The functions of both these joint bodies were to be consultative and were not binding on the management.

The response to these schemes was encouraging to begin with, but gradually waned.

o A study team was appointed in 1962 to report on the working of joint councils and committees.The team identified some reasons for their failure.i

Noi concrete steps were taken to remove the difficulties, or change the pattern of participative management.

During the emergency of 1975-77, the interest in these schemes was revived by the then Prime Minister by includingWorkers¶ Participation in industry in the government¶s 20-point programme.

o The government started persuading large enterprises to set up joint consultative committees and councils at different

levels.The Janata Government who came to power in 1977 carried on this initiative.

In was again emphasized by the Congress government who came back n 1979.

This continued in a ³non-statutory vein´ till the late 1980s, and the response from the employers and employees stayed

luke-warm.

o Then, the 42nd Amendment to the Constitution was made.Now, Article 43-A reads: The State shall take steps,i by suitable legislation, or in any other way, to secure the participation

of workers in the management of undertakings, establishments or other organizations engaged in any industry.Thus, participative management is a constitutionali commitment in India.



o And then, on May 30,1990; the government introduced the Participation of Workers in Management Bill in the Rajya Sabha.

Thei bill requires every industrial enterprise to constitute one or more `Shop-Floor Councils¶ at the shop floor level,

and`Establishment Council¶ at the establishment level.

These councils will have equal representation of i employers and employees.

Shop-Floor councils enjoy powers over a wide rangei of functions from production, wastage control to safety hazards.

Thei Establishment Council enjoys similar powers.

The bill provides for thei constitution of a Board of Management of every corporate body owning an industrial

establishment.

The bill also provides for penalties oni individuals who contravene any provision of the bill.

In spite of all these

efforts, only the government and the academicians have been interested in participative management.But participative management is staging a comeback.

o The compulsions of emerging competitive environment have made employee involvement more relevant than ever before.

o Managers and the managed are forced to forget their known stands, break barriers, and work in unison.

Managers and workers are partners in the progress of business.

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