Questions

1. Why productivity had declined in Sakshi Garments Limited?

2. Who was responsible for the problem in the case?

3. Was the strategy adopted by the Vice President correct?

4. Had you been in Ghosh's position, how would you have handled the situation?

5. Has the problem been resolved in the case? Comment.

Transcribed Image Text:

Cases of Indian Organizations 447 CASE 6: SAKSHI GARMENTS LIMITED Sakshi Garments Limited was established in 1975 at Chennai. It was a 100% export oriented unit having a similar unit at Dehradun. The company manufactured readymade garments and had employed 500 workers. The garment unit consisted of measurement, cutting, stitching, finishing and packaging sections. Most of the processes had been automated in recent years. The garment unit was headed by Vice President A.K. Ghosh aged 45 years, an engineer by training, who had been with the company since its inception. He had risen fast to this position by virtue of his capability and hard work. His concern was to maintain the productivity standards of the company while keeping morale of the workers high. Declining Profitability In December, 1996 the company saw a decline in the profitability which greatly concerned the top management. A team led by Ghosh was formed to review the costs under all heads. It was found that overtime cost had increased and the performance of the workers in general had declined considerably against the agreed norms. It was realized that laxity in monitoring had led to such a state. The supervisors were pulled up but no punitive action was taken against them. The company had entered into an agreement with the recognized union eighteen months ago fixing performance standards of each job and deduction of proportionate wages for any shortfall in the performance standards. The norms were set realistically on' the basis of the performances achieved by the executive trainees. The shortfall was severe in the stitching section where performance declined to 73% of the set norms. Most of the workers' performance were 60-65% of the norms. The problem required an immediate attention. The team decided to initiate the corrective measures in this section. Cases of Indian Organizations 447 CASE 6: SAKSHI GARMENTS LIMITED Sakshi Garments Limited was established in 1975 at Chennai. It was a 100% export oriented unit having a similar unit at Dehradun. The company manufactured readymade garments and had employed 500 workers. The garment unit consisted of measurement, cutting, stitching, finishing and packaging sections. Most of the processes had been automated in recent years. The garment unit was headed by Vice President A.K. Ghosh aged 45 years, an engineer by training, who had been with the company since its inception. He had risen fast to this position by virtue of his capability and hard work. His concern was to maintain the productivity standards of the company while keeping morale of the workers high. Declining Profitability In December, 1996 the company saw a decline in the profitability which greatly concerned the top management. A team led by Ghosh was formed to review the costs under all heads. It was found that overtime cost had increased and the performance of the workers in general had declined considerably against the agreed norms. It was realized that laxity in monitoring had led to such a state. The supervisors were pulled up but no punitive action was taken against them. The company had entered into an agreement with the recognized union eighteen months ago fixing performance standards of each job and deduction of proportionate wages for any shortfall in the performance standards. The norms were set realistically on' the basis of the performances achieved by the executive trainees. The shortfall was severe in the stitching section where performance declined to 73% of the set norms. Most of the workers' performance were 60-65% of the norms. The problem required an immediate attention. The team decided to initiate the corrective measures in this section.

Answer rating: 100% (QA)

Answer1Productivity had declined in Sakshi Garments limited because of the following reasons 1 Lack ... View the full answer