Stable 1, Horses 2
Tatas are the most respected and venerable industrialists in India today and they have been that way for about a century now. JRD Tata was a pioneer in many fields and those were very varied and contributed to the overall growth of the community, country and his own wealth and that of his shareholders. It is only fit that Ratan carry forward JRD's legacy and the latest acquisition by Tata Steel of Corus Group of UK is a standing testimony of the groups resolve to be independent and be able to deliver to the shareholders.
But this post is more about comparing 2 companies from the Tata fold that are viewed so diagonally opposite way by their employees. The two in question are Tata Steel and Tata Consulting Services (TCS). While Tata Steel has been praised for it's employee friendly initiatives which includes constructing the town of Jamshedpur and running it efficiently, institution of Employee Provident fund when there was no such concept anywhere in India, instituting an 8 hour work day way before the Britishers passed law to create a 12 hour work day etc, TCS has always been accused of exploiting it's employees including paying them pittance, imposing bonds and other such semi-legal measures to prevent attrition and even getting back their tax-refunds.
How come 2 companies from the same stable, adhering to the same corporate principles of governance be so different ? I think this will make up a good topic for a PhD student in Human resources. But I've been thinking about it a while and some facts stand out between the companies and it's employees that might be the reason for such behaviour.
In case the Steel arm, it recognizes that skilled labor is very essential for its survival. Even though many will view steel workers as just manual labor, the crucial difference between a successful steel venture and an also ran is the efficiency which in turn depends on the skill of the workforce. Therefore Tata Steel's survival dictates that it keeps attrition very low and workers happy.
On the other hand for TCS even though the labor is termed highly skilled is still available in abundant quantity. There's no real reason for it to play nice with it's employees because they can be easily replenished. Infact TCS will do well to manage their operations with green people as they can be paid less than the more experienced folks.
Looking at the other part of the equation which is employees themselves, Tata Steel workers know that they are skilled but they also know that the skill they have acquired is not something they can use at another place down the road. So the plant needs their skill and their skill needs a plant. A nice and happy dovetail.
Coming to our IT guys, from what I've seen, many would just jump ship at mere Rs.10k difference in salary. I know of instances when Infosys, Wipro and CTS used to poach people from one another. The employee feels no commitment to work for the company just like how the company feels no real compulsion to retain them. So it's a perfect market economy in the IT industry. TCS wants to extract the maximum by paying the minimum whereas employees want to spend minimum time and escape as quickly as possible.
So basically the skills required and it's availability dictates the level of employee friendliness in these two companies that share the same brand name. Contrary to the belief IT Skills are not high tech at all. Infact I don't know why IT companies recruit B.E. degree holders first and then go on to other skillset. Many in US who have risen to good positions including my own former team leads and project managers never had anything more than an associate degree which is like our SSLC. Whereas a steel worker might just have some vocational training as his educational qualification but his experience is something that is invaluable. I don't think any amount of degree can compensate for the lessons these guys would have gained on the job. Hence TCS recruits B.E. degree holders but treats them like an SSLC passout while Tata Steel hires SSLC passouts and treats them better than degree holders. Samjhe....
But this post is more about comparing 2 companies from the Tata fold that are viewed so diagonally opposite way by their employees. The two in question are Tata Steel and Tata Consulting Services (TCS). While Tata Steel has been praised for it's employee friendly initiatives which includes constructing the town of Jamshedpur and running it efficiently, institution of Employee Provident fund when there was no such concept anywhere in India, instituting an 8 hour work day way before the Britishers passed law to create a 12 hour work day etc, TCS has always been accused of exploiting it's employees including paying them pittance, imposing bonds and other such semi-legal measures to prevent attrition and even getting back their tax-refunds.
How come 2 companies from the same stable, adhering to the same corporate principles of governance be so different ? I think this will make up a good topic for a PhD student in Human resources. But I've been thinking about it a while and some facts stand out between the companies and it's employees that might be the reason for such behaviour.
In case the Steel arm, it recognizes that skilled labor is very essential for its survival. Even though many will view steel workers as just manual labor, the crucial difference between a successful steel venture and an also ran is the efficiency which in turn depends on the skill of the workforce. Therefore Tata Steel's survival dictates that it keeps attrition very low and workers happy.
On the other hand for TCS even though the labor is termed highly skilled is still available in abundant quantity. There's no real reason for it to play nice with it's employees because they can be easily replenished. Infact TCS will do well to manage their operations with green people as they can be paid less than the more experienced folks.
Looking at the other part of the equation which is employees themselves, Tata Steel workers know that they are skilled but they also know that the skill they have acquired is not something they can use at another place down the road. So the plant needs their skill and their skill needs a plant. A nice and happy dovetail.
Coming to our IT guys, from what I've seen, many would just jump ship at mere Rs.10k difference in salary. I know of instances when Infosys, Wipro and CTS used to poach people from one another. The employee feels no commitment to work for the company just like how the company feels no real compulsion to retain them. So it's a perfect market economy in the IT industry. TCS wants to extract the maximum by paying the minimum whereas employees want to spend minimum time and escape as quickly as possible.
So basically the skills required and it's availability dictates the level of employee friendliness in these two companies that share the same brand name. Contrary to the belief IT Skills are not high tech at all. Infact I don't know why IT companies recruit B.E. degree holders first and then go on to other skillset. Many in US who have risen to good positions including my own former team leads and project managers never had anything more than an associate degree which is like our SSLC. Whereas a steel worker might just have some vocational training as his educational qualification but his experience is something that is invaluable. I don't think any amount of degree can compensate for the lessons these guys would have gained on the job. Hence TCS recruits B.E. degree holders but treats them like an SSLC passout while Tata Steel hires SSLC passouts and treats them better than degree holders. Samjhe....
Labels: Employee Relations, Tata Steel, TCS
posted by Karthik S at
6:44 PM
1 Comments:
Interesting article, but I have to point out one major flaw in your argument. You are comparing Tata Steel from the pre globalization days to the TCS of today. I cannot really corroborate the facts you present about TCS. On the other hand Tata Steel of today, in its campaign to grow bigger and better does not really value employee loyalty that much. And employees on the other hand do actually have a whole lot more options than they did earlier. With the worldwide steel markets in an upswing, I personally know employees who are leaving Tata Steel for better positions elsewhere. And elsewhere now translates to pretty much anywhere in the big wide world.
And another thing, Tata Steel took in what you call SSLC candidates maybe in the early fifities. Steel making is highly modernized now and does not require manual labor in anymore. Shop floors were eerily devoid of human beings on my last visit in 2001. So for as long as I know, Tata Steel has always hired graduate engineers to fill its rank. They do however run what was called an apprentice program, but even those candidates have to ultimately get their diplomas while working.
By
Anyesha, At
8:37 AM
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