Case Study in HRP & Job Analysis

Case study in HR Planning & Analysis
Mr. Suresh was the present owner of a medium-sized steel manufacturing unit (Allied
Engineering Works Ltd) near the industrial city of Jamshedpur. This factory had been set-up by his father
Mr. Vivek, in 1965, with only 25 workmen and a few core technical personnel (mainly from Tata Steel).
The company bought steel billets from the nearby Tata Iron & Steel Company, for processing into various
items like rods, angles, I-sections mainly for the use in the construction sector. Within twenty years, the
company had established a name for itself, the turnover had crossed 100 crores and the employee strength
had also risen to 65 persons.
By the mid nineties, when Mr Vivek handed over the responsibility of running the show to his son
Mr. Suresh, the factory had a turnover of one hundred and fifty crores and employed about two hundred
workmen, staff and managers. After taking over, the first action of Mr. Suresh was to go in for a thorough
modernization. Taking advantage of the liberalisation policy of the Central Govt, he took a massive
loan from the banks and replaced all the old steel making machinery with the latest ones from Germany.
Though he was not a qualified Engineer, he had developed enough technical knowledge (by working in
this factory immediately after graduating from college) to understand the role of modern steelmaking
technology in reducing costs and improving the bottom-line of the company.
He also had the business acumen to foresee the rising demand for special types of steel items for
defense production as well as for the export market in USA. Although he did not discontinue the
traditional items that the factory was making (rods, I sections etc, mainly catering to the construction
industry), he aimed to set-up a plant exclusively for the manufacture of those special items that he had in
mind. He therefore engaged a reputed consultant group to advise him in these matters i.e right from
purchasing of machinery, civil construction work, installation of equipment and commissioning.
Along with introducing new machinery, Mr. Suresh also started to build a solid management
cadre comprising of experienced people (mainly from the steel industry) and fresh graduates from various
B Schools who replaced the largely non-technical staff (retirees) from his fathers time.
Simultaneously he also began an employee rationalization program as he felt that some old
departments had excess manpower (for example purchase and materials handling) while others (like
accounts, laboratory) had less people and he was interested in knowing how many people could thus be
spared from the old set-up and transferred to the new unit. In this way he felt, he could reduce the
recruitment of new personnel for the new Special Steel Division.
1
Since the entire Civil, Mechanical and Commissioning of the new plant was being handled by the
consultant firm, Mr. Suresh was not much worried about that issue. However, the issue of manpower was
a problem that he was really worried about. He knew that he would have to recruit qualified Metallurgists,
Quality Control personnel, experienced Engineers to run and look after the maintenance work and also
hire capable workmen to man the sophisticated machines. He had already recruited a very experienced
HR man, Mr Prasad (ex Tata Steel) and had numerous discussions with him regarding this problem. They
had both come to the conclusion that the compensation for all the personnel of the new Special Steel
Division would be much higher than the present personnel in the old factory and so it would be better not
to locate this new factory in the same campus, adjacent to the existing one. (Q1 Is this decision OK?)
Mr. Prasad knew that recruiting and selecting capable people (Metallurgist, Analytical Chemist,
Mechanical Engineers) for the new division (Special Steel) as well as giving them adequate compensation
would be a very difficult task. The new plant would be using the latest computer-aided state-of-the-art
machines sourced from the finest plants in Germany and there were not many plants in the country using
such highly sophisticated machines. The main problem was that since there were very few similar plants
in the country making such special steel components and also utilizing the latest machinery. So, actually,
the nature of work to be done by the new incumbents in the Special Steel Division was largely unknown.
What was known was that their work in the new plant would be completely different from what the
personnel did in the old plant because the technologies were very different.
So Mr. Prasad had to somehow assess the future workload in the new plant, design an appropriate
compensation structure and also complete the recruitment and selection process within the deadline (six
months) given by Mr. Prasad.
Q2 How should Mr. Prasad begin to draw-up a realistic action plan - advise him about
which action should he give priority and why.

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Case study in HR Planning & Analysis

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