Mr. Pradeep Mehta, Production Manager of Asiatic Bearings Limited, has been thinking over cost-effective operations for his factory. Time and cost reduction are very essential for making the product competitive, more attractive, reasonably priced and suited to changing requirements. Mr. Mehta knows that his employees are very energetic and innovative. Therefore he started the system of collecting valuable suggestions from his staff.
His ‘production centre’ is connected to stores and supplies, marketing people and executives from the head office. Internally, his centre is subdivided into production departments and service departments (maintenance, time keeping, research and development, canteen, factory accounts and factory storage).
A variety of ball bearings are produced in his factory. With increasing competition from the new comers in market and growing scope in the foreign market, he thinks that ‘cost-reduction’ is very essential. Hence, he decided to locate all those areas where permanent cost-reduction is possible, without affecting the quality of the product. This would require a new look at each and every operation, so that newer ways and means of doing things are possible.
Mr. Mehta knows that change in operations may also require adequate training to be given to the employees. ‘Employee Resistance’ may also be possible to the ‘change in methods’. There is very possibility of ‘redeployment of surplus labour’, if ‘operational restructuring’ causes reduction in manual inputs. Simplicity in operations, reporting, control, revisions etc. is another expectation from this restructuring.
Interpersonal relations, interdepartmental interaction and ‘group dynamics’ are supposed to undergo wide change, due to ‘process restructuring’. As any business is an open process it is always exposed to internal and external variable of change. These variables at macro and micro levels, are to be suitably tackled so that the overall ‘process of change’ becomes smooth, effective and timely.
Mr. Mehta is worried of selecting the best approach for managing this possible change. Because, this approach should not depend on shortsightedness causing heavy cost in the long run. Involving people in the process of change is a very critical task, which Mr. Mehta want to complete with positive gains.
Q.
1) Discuss the scope for ‘business process restructuring’ so as to give cost-reduction and other benefits mentioned above.
2) Discuss a smooth method of managing this restructuring and its effects.
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