Human Resource Management

Assignment 2
Topic: State the HRM policies of a renowned company.
Company: Tata Motors Ltd.

Submitted to: Submitted by:

Mr. Nandkishore Baraik Amisha Agarwal

Asst. Professor Ilma Zafar

NIFT Bhubaneswar Maya N.M.

Vaisistha Bal

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CONTENT PAGE NO.
INTRODUCTION TO HRM 3-4

TATA MOTORS LTD. 5-6

HR POLICIES OF TATA MOTORS 7- 15

‐ Recruitment
‐ Selection
‐ Training and development
‐ Performance management
‐ Performance appraisal
‐ Goal-setting model
‐ Job design and analysis

OTHER POLICIES AT TATA MOTORS 16- 17

‐ Retention and employee welfare
‐ Compensation
‐ TATA SCIP
‐ Executive selection scheme
‐ Volunteering policy

FACTORS AFFECTING HRM 18- 23

‐ Economic
‐ Social
‐ Cultural
‐ Political
‐ Technological
‐ Legal and Regulatory

CASE STUDY - Transformation of HRM practices in India after the 24 - 25

liberalization

CASE STUDY: labour unrest at Tata Motors Ltd. and the long term wage 26 -27
settlement agreement

RECOMMENDATIONS 28 - 29

CONCLUSION 30

REFERENCES 31

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INTRODUCTION TO HRM

Human Resource Management is the process of recruiting, selecting, inducting employees,

providing orientation, imparting training and development, appraising the performance of
employees, deciding compensation and providing benefits, motivating employees, maintaining
proper relations with employees and their trade unions, ensuring employees safety, welfare and
health measures in compliance with labour laws of the land and finally following the Orders /
Judgements of the concern High Court and Supreme Court, if any.

HRM involves management functions like planning, organizing, directing and controlling

 It involves procurement, development, maintenance of human resource.

 It helps to achieve individual, organizational and social objectives.
 Human Resource Management is a multidisciplinary subject. It includes the study
of management, psychology, communication, economics and sociology.
 It involves team spirit and team work.
 It is a continuous process.

Importance of HRM

Behind production of every product or service there is a human mind, effort and man hours
(working hours). No product or service can be produced without help of human being. Human
being is fundamental resource for making or construction of anything. Every organisation
desire is to have skilled and competent people to make their organisation competent and best.

Among the five Ms of management, i.e., men, money, machines, materials, and methods, HRM
deals about the first M, which is men. It is believed that in the five Ms, "men" is not so easy to
manage. "every man is different from other" and they are totally different from the other Ms in
the sense that men possess the power to manipulate the other Ms. Whereas, the other Ms are
either lifeless or abstract and as such, do not have the power to think and decide what is good
for them.

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The Agenda of Today’s Human Resource Management Team

Today’s HR management team must focus their efforts on five, critical areas, according to
the Forbes article:

Define and align organizational purpose: A company’s employees must be able to clearly
articulate why the company exists in order to achieve a purpose-driven, sustainable, high-
performing organization. Employees must also understand how their efforts connect, or align,
with the organization’s purpose.

Recruit the best talent by creating, marketing, and selling an Employee Value Proposition
(EVP): False marketing and misconceptions about an organization are some of the main
reasons why the employer-employee relationship fails. Therefore, companies must create,
market, and sell an EVP that is true and accurate as to not mislead potential employees.

Focus on employee strengths: Companies must make every effort to understand what
candidates and employees do best and put them into roles where they can play to their strengths
as much as possible.

Create organizational alignment: Achievements must align with the organization’s

objectives so as to build a successful and sustainable organization.

Accurately measure the same things: All internal departments and employees must be
measuring the same things as to achieve a definitive organizational result and to ensure that
everyone knows exactly where the organization is at all times.

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TATA MOTORS LTD.

Tata Motors Limited (TML), a USD 42 billion

organization, is India’s largest automobile company
by revenues. The company is a leading global
manufacturer of cars, utility vehicles, buses, trucks
and defense vehicles and is working towards
developing Smart Mobility Solutions for Smart Cities. Tata Motors is also developing a smart
range of EVs, to accelerate the adoption of Electric Vehicles (EV) in the country, supporting
the government’s mission on electric vehicles.

Incorporated in India, in the year 1945, Tata Motors is a part of the USD 100 billion Tata group
and has operations across India, UK, South Korea, Thailand, South Africa, and Indonesia. A
leader in the Indian commercial vehicle market, Tata Motors also ranks amongst India’s top
passenger vehicle manufacturers, with over 9 million vehicles plying on Indian roads. The
company has played an instrumental role in transforming the country into a destination for
world-class automotive manufacturing and continues to work towards building the nation. Tata
Motors has always been at forefront of innovating technologies and providing products and
experiences catering to the discerning needs of our customers across both passenger and
commercial vehicles business. With its corporate brand identity - Connecting Aspirations, Tata
Motors continues to create segment-defining products that will fire up the imagination of
customers - generation after generation; reiterating the company’s promise of offering better
journeys.

Mission

We innovate mobility solutions with passion to enhance the quality of life.

Vision

 Delivering superior financial returns

 Driving sustainable mobility solutions

 Exceeding customer expectations, and

 Creating a highly engaged work force

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Core Values

 Integrity
 Teamwork
 Accountability

 Customer focus
 Excellence

 Speed

HR Planning
HR Planning is understood as the process of forecasting an organization’s future demand for,
and supply of, the right type of people in the right number. After this only the HRM department
can initiate the recruitment and selection process. It is called by manpower planning, personal
planning or employment planning. Manpower planning relates it establish job specifications,
determining the number of people required, and finding supply source to fill these
requirements.

Objectives of HR Planning in Tata Motors

 To recruit and retain the human resources of required quantity and quality.
 To foresee the employee turnover and make the arrangements for minimizing turnover
and filling up of consequent vacancies.
 To meet the needs of the program of expansion, diversification etc.

 To foresee the impact of technology on work, existing employees and future human
resources requirements
 To improve the standards skill, knowledge, ability, discipline etc.,

 To assess the surplus or shortage of human resources and take measures accordingly.
 To maintain congenial industrial relations by maintaining optimum level and structure
of human resources;

 To minimize imbalances caused due to non-availability of human resources of right

kind, right number in right time and right place;
 To make the best use of its human resources; and

 To estimate the cost of human resources.

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HR POLICIES OF TATA MOTORS
1) RECRUITMENT
Recruitment is a prospecting job where organization makes search for prospecting employees.
Recruitment involves attracting and obtaining as much application as possible from eligible
job-seekers.

When it comes to the recruitment process of Tata motors they just followed both internal and
external source of recruitment and the nature of the recruitment process of the company is
subjected to employment law. The main forms which the company is using are advertising in
newspaper, magazines, and Tata motors careers portal and also internal vacancy list. At the end
of every quarter the company is floating their recruitment process on their web portal for the
new candidates and most of the vacancies are filled by the candidates who belong to B. tech
and MBA Background.

Internal

 Job Posting
 Skills Data Base
 Employee Referrals by Other Departments

External

 Advertisement
 Placement Agencies
 Internships
 Job Sites
 E-Recruiting
 Campus

Eligibility

Tata Motors Placement drive selects the candidate with some requirements for the job post.
The interested candidate can apply and check out the eligibility criteria for the post. The
eligibility is mentioned below:

 The minimum qualification of a candidate is that he/ she must have finished the
graduation or post-graduation.

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  Only B. E/ B. Tech/ M. Tech/ M.E/ MCA/ MBA streams can apply with mathematics
as an essential subject in the academics.
 A minimum of 60% is required in academics.
 No backlogs at the time of the interview.
 A minimum gap of 1 year in education is allowed.
 The age limit for the post is 18-33 years.

Tata Motors Recruitment Test: Exam Pattern

The placement exam pattern can see questions from English Language, Analytical Ability,
Quantitative Ability, and Technical sections.

 Mode of exam: Online

 Total Questions: 100 or 120 MCQs
 Time Limit: 2 hours

2) SELECTION
The selection process can be defined as the process of selection and shortlisting of the right
candidates with the necessary qualifications and skill set to fill the vacancies in an organization.
The selection process varies from industry to industry, company to company and even amongst
departments of the same company.

Tata Motors follows sequence of stages for selection of employee. The process of selection for
campus recruitment starts from written test and drives till the final selection, placement and
training. The company screen the applications and called the candidates for written test. The
passed candidates are called for interview, then after verification of documents of selected
candidates human resource department of Tata Motors issues offer letter.

The TML recruitment process usually happens for off campus in three stages, that is, first the
Written Exam, then GD (Group Discussion), which is followed by the final HR Round
(Interview). Qualified applicants in the written test will be able to attend the personal interview
which will be conducted by the unbiased observer of the selection panel authorities. After the
recruitment is successful, selected candidates can be offered jobs across India.

 Online Aptitude Test

 Technical Interview

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  HR interview

It is crucial for the candidates to ace the written exam to move forward with the hiring process.
Those who will fail the written exam will be not be called for the next round. Tata Motors
Recruitment Result will be sent by email/call to the selected candidates.

3) TRAINING & DEVELOPMENT

Training and development offer competitive advantage to a firm by removing performance
deficiencies; making employees stay long; minimizing accident, scrap and meeting future
employee needs.

Tata Motors is providing training to new and existing employees,

 To aware them with company’s mission, vision, rules, regulation and working
conditions of company.
 To energize and enhance knowledge and skill
 For updating of technological changes, promotion and career growth, mentoring of
managers etc.

Tata Motors established various training and development programs like TAS and TMTC for
creative leadership within the company, improvement of organizational performance through
dissemination of the latest knowledge and skills among practicing managers, development of
learning organizations and attitudinal changes in employees. All board of directors to decide
for the training & development system addresses development needs of various segments of
workforce through the Tata Motors Academy (TMA). There are well defined Manufacturing
Excellence Centre & Innovation, Commercial, Corporate, Management Development and
Global Leadership are a part of TMA these Centers got a Centre of Excellence (CoEs). These
CoEs address the needs of different categories of employees and functions through the
classroom interventions, external programs as well as an in-house learning management system
(LMS) based online platform. Tata motors academy offers learning involvement at each level
of an employee’s transition in the organization beginning with his/her joining.

Leadership development programs include:

 TATA Group Strategic Leadership seminar

 TATA Group Executive Leadership seminar

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  TATA Group e-Merging Leaders seminar

E-learning programs include:

 Live e-classroom
 Live video broadcast and
 Self-paced e-learning programs

Kaushalya

TATA Motors Limited runs a skill development Program called Kaushalya (TATA MOTORS
ACADEMY). The program will include modules in light of the aptitudes for configuration,
design, engineering, manufacturing, automobile production, sales & service as well in various
support functions with a focus on quality, productivity, dexterity, discipline and safety.

VConnect

TATA Motors Limited include VConnect is the umbrella brand for all Employee Engagement
Initiatives in TATA Motors Limited. The VConnect logo symbolizes our organizational
endeavor to bring all employees together and provide an open platform that enables free
exchange of ideas, knowledge and aspirations. The various initiatives under VConnect are
undertaken with an objective of improving the way employees feel by bringing in a sense of
belongingness.

The main objective of these kinds of training and development centers are improvement of
organizational performance through dissemination of the latest knowledge and skills among
practicing managers, to facilitation of attitudinal and behavioral changes, provide solutions for
organizational issues and to development of learning organizations.

In TATA Motors a Four Quadrant Approach of learning uses by the company, namely:

 Socialization

Where employees share their tacit knowledge among member that create common mental
models and abilities. Socialization transfers tacit knowledge most frequently through the
medium of shared experience.

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  Externalization

The process of articulating tacit knowledge and transforming it into models, concepts,
analogies, stories and metaphors that can be communicated by language.

 Combination

Is the process of combining or reconfiguring bodies of existing knowledge in order to generate

new explicit knowledge, by addition, it is the most common process in formal education. In
organizations, it is obtained by the exchange of explicit knowledge among members, as in
formal reunions.

 Internalizations

Where employees share their explicit knowledge to tacit like new employee share his previous
employer’s experience.

4) PERFORMANCE MANAGEMENT

Performance management is a process of ensuring that set of activities and outputs meets an
organization's goals in an effective and efficient manner. Performance management can focus
on the performance of an organization, a department, an employee, or the processes in place
to manage particular tasks.

As part of its endeavour to nurture a culture of performance and accountability, Tata Motors
has announced the introduction of a performance improvement programme (PIP).

Earlier the performance management was done once in a year but the PIP system manages the
performance in every 90 days. The PIP, which will run for 90 days will give clearance to all
the employees who are reviewed as ‘On Track’. The programme will be conducted by business
HRs and other senior managers. Generally, low-performing employees are put under such a
programme so that they can be trained and guided properly to perform well in the future.

However, the employees who fail to show any progress during the 90- day PIP will be put
under an extended PIP for another 45 days to give them a second chance to prove their ability
to perform. The extended programme will be reviewed by the skip managers or senior
managers. The employees who fail to prove their mettle in the extended PIP will be shown the
door.

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During a PIP, a low performer is put under training with the supervising manager. The manager
regularly updates the organisation on the progress of the employee.

Sometimes, the low performers are also put to work with some of the best performers to
motivate their spirits. Apart from that, regular coaching and mentoring is done by the managers.

A PIP is generally treated as a filtering mechanism, where the organisation identifies the poor
performers, and gives them a chance to improve over a few months. However, if nothing comes
out of the exercise, they are asked to leave.

It is also important to take regular feedback from the employees. After all, it is essential to find
out the reason why they are not performing and remove the demotivating factors hindering
their productivity.

Such activities help organisations identify, train and filter out the low performers.

5) PERFORMANCE APPRAISAL

A performance appraisal is a regular review of an employee's job performance and overall

contribution to a company. Also known as performance review or evaluation, a performance
appraisal evaluates an employee’s skills, achievements and growth or whatever they lack.
Companies use performance appraisals to give employees big-picture feedback on their work
and to justify pay increases and bonuses, as well as termination decisions. They can be
conducted at any given time but tend to be annual, semi-annual or quarterly.

The appraisal model which is followed on annual basis has been extremely effective for the
employees of Tata Motors. With a half yearly appraisal system, the employee gets feedback
twice a year, which gives him/her a chance to re-look at his/her approach of working. Necessary
steps are also undertaken for employees who deviate from their goals. They have introduced a
comprehensive system of quarterly appraisals’ where an employee selects his/her own goals or
Key Result Area (KRAs) every quarter and him/her self-assesses his/her own performance
against these parameters.

Tata Motors have a midterm review for all those who have been performers, thereby creating
an expectation amongst the employees of an increase in salary twice a year if they perform
well.

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They do give monetary increments and designation hikes, according to the performance. If the
employee deserves both, they give him/her both the advantages otherwise at least one of them.

Designation hikes are given annually. These are proportional to effort of the individual, team
and the department. Designation changes are given keeping in mind the immense responsibility
one has to shoulder in a high rank.

Monetary increments are primarily incentives that are given either in cash or kind for example
they give them travel package within India or outside. Also, they have an accumulating
incentive scheme in which employees can accumulate incentives and get them annually with
interest.

To meet the new demands of the business and to motivate the employees for higher
performance, they have started linking a part of the salary increase to individual performance
measures as variable pay. At present, between 6 to 8 percent of the compensation is variable
pay, which they are planning to increase over a period of time. Executives are categorized in
levels based on their performances in a relative ranking and based on outcome performance
linked pay is awarded.

6) GOAL-SETTING MODEL

A goal setting program in an organization requires careful planning. Goals can be established
in a variety of ways. Best way is to set by joint participation between the employee and the
supervisor. This method often leads to employee commitment, a crucial ingredient in effective
goal setting.

Goal Setting

S.M.A.R.T.* Goals

• Specific – precise and detailed

• Measurable – with criteria for determining progress and success

• Achievable – attainable and action-oriented

• Realistic – relevant and aligned

• Time-related – grounded within a time-frame

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For this purpose, an online template is circulated in the organization. Superiors fill out that
form keeping in view the performance of their subordinate over the year. This feedback
becomes the basis of the promotion of the employees. Superior is responsible for categorizing
the employees in four categories, namely – A B C D. This categorization is done both on the
basis of performance and the goals they were given. This whole system is commonly known
as 90-degree appraisal system also called 2 tiers.

7) JOB DESIGN AND ANALYSIS

Job design is the process of deciding on the contents of a job in terms of its duties and
responsibilities and analysis is the systematic investigation of tasks, duties and responsibilities
of a job.

 Performance and potential appraisals- Tata uses the performance and potential
appraisal as a part of the job process. Higher officials often determine whether a
particular employee has the potential to take added responsibilities in future. It also
helps to evaluate candidates for promotions and developing a suitable employee base
for succession planning. This method is based on the aptitude of the employee, his
willingness to take additional responsibility and his motivation for accomplishing tasks.
It is a normal practice to promote employees based on their past performance.
 Fast-track performers- Fast-tracking high potential management and technical talent
is a strategy that Tata Motors and many organizations are using to ensure that the good
people they are able to attract are properly developed, effectively utilized and retained.
Potential high performers are attracted to organizations with fast-track systems. Also,
the systems do move people quickly through necessary experiences into key
management positions. And fast-trackers tend to be extremely loyal to the organizations
which so recognize them as high-potential individuals.
 Job rotation- job rotation is an effective technique followed at Tata motors, where,
employee roles are rotated in order to promote flexibility and tenure in the working
environment. Through job rotation, employees laterally mobilize and serve their tasks
in different organizational levels; when an individual experiences different posts and
responsibilities in an organization, the ability to evaluate his or her capabilities in the
organization increases. By design, it is intended to enhance motivation, develop
workers' outlook, increase productivity, improve the organization's performance on

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 various levels by its multi-skilled workers, and provides new opportunities to improve
the attitude, thought, capabilities and skills of workers.
 Selection of managers- The selection of positions for managers is done through
performance management or appraisal methods or above manager posts is based upon
the vacancy and is generally done by conducting an interview. For the job analysis
method, the analysts at Tata motors conduct interviews for the purpose of promotion or
any kind of tracking of the task they have been doing. The interviews are basically
structured.
Structured interviews follow a systematic approach where employees are interviewed
accurately and consistently, following a pre-set format. In a structured interview, you
typically see that:
o All interviewees are asked the same questions in the same order.
o Interviewers record, compare and evaluate answers against standardized
criteria.
o The interview process remains the same even if the interviewer changes.

 Selection of supervisors- The selection for the supervisors is based upon their
performance, attendance and even the discipline record. It is done by conducting a
written test and the person who clears the written test goes for the second round i.e. the
personal interview.

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OTHER POLICIES AT TATA MOTORS

1) RETENTION AND EMPLOYEE WELFARE

Tata gives benefit to the employees who are working there in terms of exposure in the field of
work and gives lot of liberty to work. The best thing is that it stays constant. Tata Motors really
takes care of employees and their family at all costs borne by the company. Employees gets
just about anything they might need for a family stay. They get the benefits like residential
colonies, travelling allowance, medical allowance, life insurance, vehicle loans, annual
advance, sick pay benefits, proposed MUL pension scheme and PF trust and others mentioned
in the offer letter by the company.

2) COMPENSATION

As per the pay-scale, the average salary for the employee differs from each other based on the
job profile of a candidate. Like in case of project manager (Engineering) his average salary
ranges between 500000-1800000 per annum and for design engineer its 6 lakhs to 10 lakhs and
for mechanical engineer its 8312000-2012200. Basically, according the rank of an individual
and experience in the particular field they are giving the compensation.

3) TATA SCIP

This is one of the initiatives taken by Tata Motors which basically focuses on women
professional and it’s a career transition management programme for women professionals who
earlier have taken a break of 6 months or more due to any reason and now wish to enter the
profession field again. The programme provides an opportunity for such kind of women to take
on flexi-hour assignments. Tata SCIP does not provide full time job opportunities. Assignments
under SCIP are short-term and aimed at developing alternative talent pools in traditional/non-
traditional formats. There is no placement guarantee at the end of the project.

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4) EXECUTIVE SELECTION SCHEME

This Scheme is a fast track programme of Tata motors which basically accelerated growth of
high potential professionals and the scheme facilitates their early advancement to challenging
and visible assignments through a systematic procedure. Employees selected gain a huge lead
in terms of promotion as well as learning. They are promoted to Manager’s level there by
saving almost 10 to 13 years of work time within Tata motors. The successful Employees are
relieved from their current jobs and put on various project-based training programmes under
the guidance of senior managers who are working in the company If the Employee or a
candidate do not possess management education, they undergo a 4 months MEP at IIM,
Ahmedabad. After successful completion of training the candidates are mandatorily rotated
across departments to acquire general management skills which is the best thing of this
initiative.

5) VOLUNTEERING POLICY

Tata motors with the concentration is always committed to create a culture of volunteering
within the company by engaging, encouraging, and recognising employee’s contribution in
terms of employee’s talent towards the quality of life of the people in and around its areas of
operation so this is one of the best action or a step which Tata motors have taken.

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FACTORS AFFECTING HRM

1) ECONOMIC FACTORS

Globalization refers to the process by which regional economies, societies, and cultures have
become integrated through communication, transportation, and trade. It is caused by four
fundamental forms of capital movement throughout the global economy.

 Human Capital (i.e., Immigration, Migration, Emigration, Deportation, etc.)

 Financial Capital (i.e., Aid, Equity, Debt, Credit & Lending, etc.)

 Resource Capital (i.e., Energy, Metals, Minerals, Lumber, etc.)

 Power Capital (i.e., Security Forces, Alliances, Armed Forces, etc.)

After the world war many committees and associations have emerged with focus on free global
trade.

Business Imperatives Driven by Changed Economic Climate:

 Need to Operate Across National Boundaries: With the advent of globalization, a business
firm needs to expand its operations across the national boundaries in order to gain
competitive advantage and sustain its business.
 Shift Manufacturing and Service Bases: Outsourcing of service base as a cost reduction
procedure by the organization is getting increasingly prevalent.
 Cost is a Major Issue and Optimizing Cost is Very Important: Companies now-a-days retain
the core department such as R & D and outsource the non-core ones
 Ensuring Presence of Emerging Markets like China, India, Brazil etc.
 Quality Assurance is Significant
 Competitive Business Strategy Needs to be Reassessed Continuously: there needs to be a
drive for constant innovation and upgradation of the business strategy continuously.
 Need to Balance Pricing Decisions and Quality Offerings: the business imperatives should
seek a balance between their pricing strategy and quality offered.
 Integrating Emerging and Unique Services and Applications in Business
 Need to Differentiate between Innovation and Manufacturing Headquarters: services are
outsourced which helps in increased efficiency of their business as well as reduced cost.

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 2) SOCIAL FACTORS

Outcomes of the social changes as whole have an effect on HRM, such as:

 Demography: The countries, like India, which have seen a swing towards younger
population, have seen a growing need to address the conversion of a potential workforce
to a dynamite talent pool.

 Growth of Income & Income Disparities

 Rise in Educational Levels: with the rise in education the levels of awareness have also
increased tremendously.

 Greater Global Citizenship: The social media has played a huge role in greater mobility
and transparency.

 Change in Family Structure: DINK - ‘Double Income No Kids’.

 Pressure Group: Social pressure groups are being created for human rights, consumer
behaviour, social groups etc.

 Equality Concept

Hr Imperatives Driven by Social Context:

Companies, now, have equality policies in their manual under which homosexuals, third gender
and under-privileged people are treated and recruited with equal rules and procedures. The
Hispanic, blacks, homosexuals and third gender are treated with same respect and motivated to
participate more in the organization.

Social Recruiting: The Society for Human Resource Management (SHRM) reports that the
number of companies using social networking sites, including Linked in, Facebook and
Twitter, to recruit increased from 34% in 2008 to 56% in 2011.

3) CULTURAL FACTORS

With multi-cultural interactions becoming more and more imminent, the need to understand,
appreciate, educate and create awareness about cross-cultural issues is a business imperative.
Businesses need to implement tools that appeal to multi-cultural sensibilities and help in

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sustaining the diverse communities. Many companies have come-out with commercials that
have a global appeal and they have appealed to the youth rather than to a single culture.

Empowered, multi-cultural workforce has necessitated the decentralisation of the policies.

Companies are adapting to policies according to the different cultures, legality, working hours,
e.g., US hourly, India Monthly, holiday policy.

Social networking websites are the new communities of change. Companies are increasingly
realizing the need to connect with people through such sites in order to appreciate better the
cultural nuances.

4) POLITICAL FACTORS

The present political climate can influence the kinds of legislation that can affect tariffs on
goods and a service which means political factors can be restrictive or beneficial.

Political factors determine how and to what degree a government intervenes in the economy.

Political factors include areas such as:

‐ Tax policy
‐ Labour law
‐ Environmental law
‐ Regional blocks
‐ Trade restrictions & Tariffs
‐ Political stability

HR Imperatives Driven by Political Context:

The HR imperatives as a result of the changed political climate and the business imperatives
necessitated by the same are as follows:
 Managing Cultural Change:
Since now organizations have a diverse workforce it’s necessary for businesses to manage the
cultural change happening.
Recruitment – Also now that businesses are spread across the globe it is necessary that care be
taken while recruiting a diverse workforce and accepts the culture with an open mind.

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  Talent Management:
Due to the dynamic nature of workforce it is necessary that organizations have an appropriate
talent management strategy to acquire, develop, retain and replenish the workforce.
Personal Development – Now that there is a shift from collectivism to individualism it is
necessary organizations focus on an individual’s career development, develop future leaders
etc.
Cross-cultural Training – It is necessary to provide training to individuals on the various
cultures they are going to work when businesses are going global.

 Structural Change in Organization:

With reduced political barriers it is an imperative that businesses have:
‐ A flat hierarchy
‐ The power distance be reduced
‐ Empowerment of employees
‐ Communication barriers be reduced
Communication should be Instant (decisions be made quickly and also feedback be provided
instantaneously) and transparent.

 Training and Development:

With changing business context, it is necessary that employees be trained to sustain in the
market with the changing technology. Also they are provided cross functional training, so that
they can be employed with the changing business needs.

 Employee Engagement:
For the success of a business it is necessary that the workforce be highly engaged and therefore
it is the need of every business to keep its employees engaged.
Employee engagement is necessary to make the employees aware of various business activities,
manages employee turnover and boost business growth.

 Increase in Use of Temporary Employment Practices:

Businesses are moving towards a temporary workforce due to various reasons. They are easy
to hire, flexible to any work timings, though they have high pay rates and they are low cost to
the company in the long run.

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  Focus on Key Players:
This is a part of the talent management strategy where the businesses target the key players
rather than the not so important players and their focus is on retaining them. This will help the
organisation in succession planning.

 Increasing Use of Technology and Business Intelligence:

Organisations are increasingly looking to technology to enhance performance and fill skills
gaps. As a result, HR is also using technology for organisation’s advantage. This can provide
the organisation a competitive edge and lowers the cost of HR operations.
The development of HR technologies is helping to transform HR into a decision science with
a measurable impact on business results. This creates new roles for HR professionals and the
imperative to develop strong HR technology competencies.
The wide range of impact of technology on HR can be clearly viewed on the HR functions such
as:
(i) Recruitment
(ii) Training & development
(iii) Performance management
(iv) Payroll & attendance records
Businesses are widely deploying Business Intelligence in HR for executing extensive
manpower assessments, preparing account reports, employee performance reports, evaluating
wages, staffing, available jobs and termination rules. This helps HR make strategic decisions
and align them with the corporate goals.

5) TECHNOLOGICAL FACTORS

The technological environment has perhaps undergone the greatest and fastest transformation
world-wide. Technology is into everything and firms that have not been able to keep pace with
the same have been forced to exit the business. Competing on technology has led to the creation
of knowledge-based organizations and has seen huge resources being allocated knowledge-
based to creation, management and strategic use of the knowledge.

According to research, more than 60% of HR’s time is transactional, administrative in nature.
In addition, HR is often not included. Up to 70 percent of a company’s market value can come
from intangibles such as its human capital, its brand, and its culture.

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So, there is a need to connect with business and organizational strategy to:

i. Understanding true state of technology readiness.

ii. Align HR efforts with business goals.

iii. Build high performance workforce.

iv. Achieve high ROI (Return on Investment).

v. Transform HR from a cost-centre to an investment-centre.

6) LEGAL AND REGULATORY FACTORS

As a result of globalization, businesses now have the opportunity to expand beyond their
national boundaries and adapt to the type of regulations followed in that particular country. For
setting up any kind of business in other nations, the business shall be much aware about the
legal/ regulatory aspects.

Employee rights vary from country to country and it depends on the talent philosophy of the
organization how they treat their employees. Only understanding the laws is not important, the
degree to which they are implemented needs to be known.

The WTO has brought all the nations to an equal platform, irrespective of them being a
Developed, Transition or Developing Economies. It has provided the Third World countries
with the opportunity to indulge in trade practices with the more economically powerful nations
of the world.

For ex: At the time when Tata Steel had to downsize, they called up a meeting for the top
officials and communicated to them the plan. He put forward an idea of “Internal
Communications Campaign” through which they would get their employees into confidence
by telling them the goals of the company and to have the line managers support them. They
also stressed on the fact that don’t give fabricated figures to the employees, rather, have an
open and transparent communication with them.

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CASE STUDY: TRANSFORMATION OF HUMAN RESOURCE MANAGEMENT
PRACTICES IN INDIA AFTER THE LIBERALIZATION— INCASE OF TATA MOTORS

Introduction

The Indian economy was rigid and closed in the 1990 but after the liberalization which
promotes the foreign direct investment and helps the Multinational organizations to establish
their business units in India helps in creating a hyper competitive environment and encourages
the Indian MNCs to inculcate the innovative HRM practices. In case of Tata motors, was found
moving towards the globalization and it was observed that recruitment, compensation and
performance practices seem to be significantly transforming within Indian firms in the context
of India’s economic liberalization.

Tata Motors is India's largest automobile company and the leader in commercial vehicles in all
segments, and among the top three in passenger vehicles. The company is the world's fourth-
largest truck and bus manufacturer (2017). Tata Motors was the first company from India's
engineering sector to be listed in the New York Stock Exchange, in September 2004.

Tata Motors is also keen to ensure that every key stakeholder in the company, including
managers, employees, customers and suppliers, get the same “One Experience” (organizational
culture), as codified in the manual, throughout its global operations

Cultural Aspect

Tata group has always been diverse, tolerant and open. Though founded by Parsis, from its
early days the group has employed people of all backgrounds based on talent not caste, religion
or regional background.

Tata group has internationalized rapidly, 60 per cent of Tata revenue came from outside India
and about 30 per cent of Tata employees, more than 100,000 people, now work for the group
outside India, and the vast majority of them are not Indian nationals. (2017)

Global Staffing and HR Policies

The desire of Tata to localize its workforce is reinforced by the statement from Tata Motor’s
Assistant manager HR in South Korea that, “Tata wants to be a Korean company in South
Korea but provide the same global experience to clients, no matter where the operations are
carried out”.

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Tata Motors strives to staff locally at least 50% of employees should recruit locally for all the
positions but in the non-English speaking countries like South Korea where nearly 75% of
Tata’s workforce is staffed locally while in UK it is nearly 50%. But the senior management
positions, from country head to project managers, at both these subsidiaries are still staffed by
expatriates from its Indian headquarters.

Liberalisation and Its Impact

After the liberalization in the economy Indian firms are trying to becoming a global hub for
outsourcing. The influence of globalization on technological advancements, business
management, communication and infrastructures are leading to a converging effect on
managerial mind-sets and business behaviours. All this had direct implications for HRM in
India and created a pressure to bring large scale structural change in their organizations.

Conclusion

Tata motors is becoming multicultural organization by diffusing its boundaries geographically,

and drawing the competitive edge from the spread of business and that creates the intermingling
of people from all over the world. One of the advantages of Tata is their diversity. They have
top managers from UK, Singapore, and North America.

Tata Motors have to ensure that the team is aligned to the rapidly changing environment and
managers need to appreciate the different styles of management that come in a multicultural
organization and adjust to this.

Being an Indian company, Tata motors uniquely placed to serve the Indian market and have
found it easy to earn the trust of other counterparts. Tata motors operating in the right
geographies, which is gaining the high growth in the market economically (Korea, UK, Spain).

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CASE STUDY: LABOUR UNREST AT TATA MOTORS LTD. AND THE LONG TERM
WAGE SETTLEMENT AGREEMENT

Introduction

On June 9, 2017, Tata Motors Ltd. headquartered in Mumbai, India, announced that it has
signed a Long Term Wage Settlement(LTS) agreement with the Worker’s Union at its Sanand
plant, Gujarat, India. The wage settlement agreement was for a period of 5 years from October
2015 to September 2020 and the total wage package of Rs. 16000 per month for each permanent
employee was to be uniformly distributed during the LTS period. The wage agreement included
a performance linked payment on the basis of productivity of the employees, safety of the plant
resources and quality of workmanship. Other benefits under the agreement were extension of
canteen and transport facilities, and block closure of 24 days annually.

The Strike
On February 22, 2016, around 300 employees went on a flash strike demanding their
reinstatement of 28 of their colleagues who had been suspended earlier. The 28 workers had
been suspended from services due to indiscipline. The initial problem started when two workers
were suspended for misconduct. The other workers protested and destroyed property in the
factory premises, which led to the management suspending another 26 workers. The
management held talks with the workers to restore normalcy and continue the plant operations.
The long pending issue of a wage hike and the suspension of some of the workers due to
indiscipline provided the trigger for the flare-up and the strike by the employees. After a long
period of negotiations between the Worker’s Union, the management and the representatives
of the Labour Department of Government of Gujarat, a long term wage settlement agreement
was finally reached.

The Long Term Wage Settlement

The long-term wage settlement (LTS) between the Tata Motors Sanand Union and Tata Motors
was amicably agreed upon and has been signed today for a period of 5 years, w.e.f October
2015 to September 2020.

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The total wage package allotted is Rs. 16,000/- and will be spread across the LTS term
uniformly. In addition to the amount, the company has also introduced a performance linked
payment, which is accounted as 10% of total salary and will be linked to productivity, quality
& safety. This new measurement of performance has been well received by workmen. The
Annual Bonus linked to performance covering all permanent workers was also agreed upon.
Additionally, other benefits like Transport and Canteen facilities and various other facilities,
like rationalization of leave rules and block closure days up to 24 days per year were mutually
agreed.

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RECOMMENDATIONS

 Tata Motors follows the concept of exit interviews before the particular employee
leaves his/her job; it is the better way to improve the problems occurring in Tata motors.
But Tata motors should conduct the interviews where the employers can discuss their
problems and the problem of leaving the job will not occur in future. So time to time
interviews with employees is also a necessity.

 The second recommendation to company is they should develop the concept of

employee recognition and rewards as this part makes less presence in company as I
believe they should encourage the creativity of their employees. Their rewards should
be based on defined and measured performance levels.

 Tata motors should Implement or execute strategic planning process on annual basis to
support the staffing needs of academic departments, centres, and administrative areas
as well as the Institute's broader mission.

 When Tata motors recruiting officer is recruiting candidates, it is recommended for the
recruiting officers to test on their group skills because each and every employee are
required to work in groups sharing and gaining knowledge in and from the group.
Therefore, group discussions must be included apart from campus placements as one
of the phase during recruitment process.

 Tata motors should design Development assessment centres which helps in supporting
managers in assessing and their capabilities

 They should develop leadership programmes for fresher’s who are joining Tata motors
for the very first time which promotes leader’s self-awareness and complex problem
solving skills thus I recommend they should go for this step also.

 When it comes to global automobile company then it is advisable to Tata Motors to be

stricter in usage of language because in this business People are coming from different
cultures tend to communicate using their own language which would be a barrier to
others who do not understand those languages. So, according to me it must be made
very clear that everyone within Tata motors speaks only in English within the company
premises.

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 Tata motors should implement study assistance programs which will include financial
assistance to meet study expenses for all employees working within Tata motors. This
gave them the opportunity to continue their formal education while working.

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CONCLUSION

Tata Motors is a Fortune 500 company, the leader in commercial vehicles in each segment. It
has retained its market leadership position in the domestic market for more than six decades
and also gained a respectable global standing. The company has mix labour force, multi-skilled
employees. The company is increasing knowledge, skills and overall development of its
employees through effective human resource policies and development programs.

In this document, Human Resource Policies and factors for the company Tata Motors Ltd. Have
been analysed in detail, with the support of a few case studies. The HR practices of a company
determine its success in terms of maintaining employees to function for greater profits. Thus,
the practice of HRM needs to be integrated with the overall strategy to ensure effective use of
employees and provide better returns to the organizations in terms of ROI (Return on
Investment) for every rupee or dollar spent on them.

Human Resource Management is the most crucial strategy for a company, since it determines
whether the company can function effectively with its employees, all the while maintaining
good relations and support from them.

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REFERENCES

 https://www.ukessays.com/essays/business/tata-motors-learning-development-
7717.php

 https://www.prep.youth4work.com/Placement-Papers/Tata-Motors-Test/About

 https://www.academia.edu/42049410

 https://www.studymode.com/subjects/manpower-planning-in-tata-page1.html

 http://www.ijrms.com/olvolume2issue6/GedelaRakeshVarma-JaladiRavi-1.pdf

 https://www.tatamotors.com/press/tata-motors-resolves-long-term-wage-settlement-issue-
in-sanand/

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