Maruti Suzuki India Limited: Marketing- Manesar Plant; Group #5

Ashika Chaurasia (M014-20), Esha Jyoti (M021-20), Jenis Godwin (M031-20), Periyasamy N
(M048-20), Sakshi Barukha (M054-20), Siddharth Richaria (M060-20), Swati Swaraj (M064-20)

Index:
❖ Overview of Maruti-Suzuki
❖ Production Distribution
❖ Major Demand of the Workers
❖ Other Demand of the Workers
❖ Levels of Communication Barriers: In Organisational Level
❖ Types of Communication Barriers involved in the case
❖ Avoidable Steps- Resolving the Conflict
❖ Conclusion
❖ Annexure 1: Timeline of Events that took place

Overview of Maruti-Suzuki:
❏ Maruti Suzuki India Limited​, commonly referred to as ​Maruti​, is a subsidiary company
of Japanese automaker Suzuki Motor Corporation.
❏ This Automobile company was founded in ​1981​.
❏ It has a market share of ​44.9%(close to 45%)​ of the Indian passenger car market.
❏ Manufacturing facilities are located at 2 facilities ​Gurgaon(3 plants)​ and ​Manesar(1
plant)​.
❏ Manufacturing ​Capacity of Manesar Plant= 1700 cars/day
❏ Maruti Suzuki offers ​15 models​- Maruti 800, Alto, WagonR, Estilo, A-star, Ritz, Swift,
Swift Dzire, SX4, Omni, Eeco, Gypsy, Grand Vitara, Kizashi, Ertiga.

Production Distribution:
❏ Manesar Plant- Swift, Swift Dzire, A- Star, SX4
❏ Import(CBU)- Kizashi
❏ Gurgaon- All other Cars

Major Demand of the Workers:

Worker’s demand to establish an independent union ​Maruti Suzuki Employees Union (MSEU)
in the company. Currently, the company has one recognized union – ​Maruti Udyog Kamgar
Union(MUKU), Pro Management Union​ which is dominated by workers at the Gurgaon plant.

Other Demand of the Workers:

1. Increase in Wages, Allowances and Incentives
As reported by the workers;
● There was a huge difference in the status of permanent and contract workers
● The wages were too low and the wage cut was too high that a 3 day’s cut was almost
equal to the monthly wage
● The associated allowances and incentives were insignificant
Hence, the workers demanded a​ five-fold increase​ in basic salary including allowances and
incentives.
2. Appropriate Working Conditions and Associated Facilities (Points added from
external research)
According to the workers, the working conditions and associated facilities they were provided
with were very appalling. From the other sources, it has been found that
● They had to work continuously throughout the day with a hurried lunch-break and just a
7 minutes tea-break
● The ​canteen, half a kilometers away from the working station​ was very​ unhygienic ​and
the quality of the food served was very poor
● Even on minor complaints, they were given​ heavy doses of the medicines​ by the
company doctors to prevent the disruption of work

3. Admitting Back the Suspended workers

The workers demanded to take back the employees who were suspended for raising the voice
against the authorities.

Levels of Communication Barriers: In Organisational Level:

Lack Of Trust- ​The management showed a lack of trust when they asked the employees to
sign the agreement to continue to be members of the pro-management union and “a good
conduct bond”. Hiring contract workers and deputed workers from other plants also showed a
lack of trust.
Organizational Structure- ​There was no line of communication between the staff and the
higher management. There was no grievance handling team that could listen to the workers.
This led to a closed environment and the workers thought their voice was not being heard and
had no option but to go on strike. The lack of communication also forced higher management
to take extreme steps.
Incorrect Medium of Communication- ​Both the parties used the wrong way of
communicating their demands. The higher management used the signing of contracts and
hiring other workers to show their authority while the workers used to strike and violence to
show their unity. It created a negative image of the workers in the mind of the management
and they felt pressured to take strict actions.
Different perceptions- ​Both the management and the workers had different perceptions.
The workers thought their rights were being denied when they were offered low wages,
incentive cuts, and poor working conditions. Whereas the management thought that the
laborers are being disrespectful by forming trade groups among themselves.

Types of Communication Barriers involved in the case:

● Attitudinal Barrier- ​ ​Perception of managers and workers did not match because of a
lack of discussion. The values and goals were different because of which workers were
unable to get an increase in an incentive as the company focussed on cost-cutting due
to which it treated contractual employees badly.
 ● Cultural Barrier-​ ​Suzuki is a Japanese company and the major stakeholder followed
the culture of Japan which created problems as Indians were not rigid and needed
flexibility.
● Environmental Barrier​- ​Lack of proper channels of communication between workers
and managers. Along with lack of a conducive work environment.

Avoidable Steps- Resolving the Conflict:

● Coercive Power​ is required from the Organisation
● “A Stitch in Time Saves Nine” ​attitude is required from the Organisation Recruitment
should be done from different parts of India. Diversity in the work atmosphere will
improve productivity, creativity, and discipline as well
● Regularly ​scheduled inspection​ should be done in every department to ensure the
quality and employee happiness
● Incentives and Increment​ in salary should be given frequently

Conclusion
MSIL​ was a leader in the automobile industry of the country. It has established itself in the
Indian passenger car segment. However, due to ​poor industrial relations, people management,
and communication breakdown​, it faced numerous strikes by the employees. The strike
increased the gap between the management and the employees. Lack of Human resource
management by an established company like Maruti cost them dearly. This led to labor violence
which could have been avoided by various measures.

Annexure 1: Timeline of Events that took place

1981-​ Maruti Udyog Limited was founded
1983​- Joint venture with Suzuki and formed as Maruti Suzuki India Limited(MSIL)
1983 December 14​- First Maruti 800 rolled out
2003- ​The government of India moved out of MSIL
June 2011​- Registration of new trade union named Maruti Suzuki employee union
July 2011​- Situation worsen citing irregularities and excessive work pressure
August 2011​- Management suspended and dismissed a few workers. Asked workers to sign a
“good conduct bond”​. Many employees resisted.
September 2011​- Management was forced to close the plant due to non-availability of parts.
7 October 2011​- 3500 workers went on flash strike which continued till 21 October 2011
18 July 2012​- Maruti’s Manesar plant was hit by violence; workers attacked supervisors
21 July 2012​- Company announced a lockout
21 August 2012​- Plant reopened