Participative Management is a sophisticated concept in the modern managerial world, atleast in India. Participative management or worker’s participation in management means giving scope for workers to influence the managerial decision-making process at different levels by various forms in the organization.
Participation in the decision-making process helps to achieve greater job satisfaction on the part of the employees and higher production on the part of the organisation. The workers can be motivated more effectively through non-monetary incentives than through monetary incentives. It is observed in recent times that participation is one of the best non-monetary Incentives. If the organisation applies the participation schemes properly, it is believed that it will be able to improve the production and productivities of the different factors of production. At the same time it serves as a motivator and satisfaction to the employees by meeting their ego needs.
Participative Management is the process of involving subordinates in the decision-making process. It stresses active involvement of the employees. It uses their expertise and creativity in solving important managerial problems. It rests on the concept of shared authority which holds that managers share their managerla1 authority with their subordinates.
Participative Management is a process of delegation of authority and responsibility in the general area of managerial functions. It means sharing in an appropriate manner the decision making power with the lower ranks of the organisation of an enterprise.
Basically Participative Management, “concerns the actions by which managers involve their subordinates in the decision-making process. Participation includes not only the physical participation of a person but also his intellectual and emotional involvement in the affairs of an organisation.
Participative Management is therefore, a system or process in which workers are called upon to express their views regarding the formulation of policies and decision-making, to the management. This is nothing but a way of satisfying the workers’ urge for self expression and creating in them a feeling of belongingness in order to get their willing co-operation for the efficient working of the organisation.
The aim of Participative Management system is to make the workers feel that the organisation is their own and its success or failure is their own success or failure. It would remove the feeling of alienation from the workers towards the management as well as other workers in the same industry.
OBJECTIVES OF PARTICIPATION MANAGEMENT
Workers’ participation in management is recommended to achieve the following objectives:-
Increasing productivity for the general benefit of the enterprise, the employees and the community.
Giving employees a better understanding of their role in the working of industry and of the process of production.
Satisfying the workers’ urge for self-expression.
Achieving industrial peace, better relations and increased co-operation in industry.
Development of human personality.
Development of leaders from within the industry.
IMPORTANCE OF WORKERS’ PARTICIPATION
Workers’ participation in management has great importance these days. This is an association of labour and management at all levels would lead to promotion of both organisation as well as employees. These are following advantages of participative management such as:
Reduced industrial unrest:- Industrial conflict is a struggle between two organized groups which are motivated by the belief that their respective interests are endangered by self-interested behaviour of the other. It tries to remove or atleast minimize the diverse and conflicting interests between the parties, by substituting in their place corporation, homogeneity of objective and common interests. Both sides are integrated through participation and decisions arrived at become “ours” rather than “theirs”.
Reduced misunderstanding:- Participation helps dispelling employees’ understanding about the outlook of management in industry. These misconceptions would otherwise die hard and their damaging effect needs no explanation.
Increased organisation balance:- If workers are invited to share in organizational problems and to work towards common goal, a greater organizational balance occurs because of decreased misunderstanding and conflicts.
Improved communication:- Due to presence of barriers to the upward flow of information in most enterprises, much valuable information possessed by subordinates never reaches their managers. Participation helps to break the barriers and makes the information available to managers due to which some decisions can be altered timely and quality of decisions is improved.
Higher productivity:- Productivity increment is only possible when there exist full co-operation between labour and management. Good relations between labour and management tend to encourage the workers to contribute more to their jobs and help to increase productivity.
Increased commitment:- Participation allow individual’s involvement and gave then opportunity to express themselves. If an individual knows that he can express his opinion and ideas, a personal sense of gratification and involvement takes place within him.
Industrial democracy:- It helps to maintain an era of democracy in industry. It tends to reduce class conflict between management and labour. It also serves as a support to political democracy.
Development of individuals:- participation management enhances individual creativity and response to job challenges. Instead of following a rigid set of instructions, if given the opportunity to question and suggest, the employees’ natural ingenuity and ability are allowed expression. This facilitates individual growth.
Less resistance to change:- When changes are introduced by management without any explanation and need specification, subordinates tend to feel insecure and take counter measures against it. But when they have participated in the decision-making process, they have had an opportunity to be heard. They know what to be expected and the reason behind it.
MODES OF PARTICIPATION
Workers’ participation in management or participative management of industrial enterprises is achieved by the various methods. Some of them are as follows:-
Works Committee:- It is extremely popular and effective method in France and in England but not in India. It consist of equal number of representatives from both groups i.e. employers and workers. They meet frequently for discussions on common problems of both groups and after discussion, joint decisions are taken and such decisions are binding on both the parties. Some matters like wage payment, bonus, training, discipline, etc. are discussed in such meetings.
Joint Management Council:- It was started in UK by British Government to recommend measures for the permanent settlement of differences between the workers and the management. It involves setting up of joint committees represented by both parties to discuss and give suggestions for improvement with regard to matters of mutual interest. The decisions of such committees are not binding on either party. They include problems like safety measures, grievance redressal, training, working hours, etc..
Collective Bargaining:- It is the process in which employees through their elected leaders participate on equal basis with management in negotiating labour agreements, in administering the agreements, and in redressing grievances of the workers.
Co-partnership:- In this, workers are allowed to purchase shares of the company and thus become its co-owners. As shareholders they can participate in management of company through their elected representatives on the Board of Directors and also attend general meetings of shareholders with voting rights.
Suggestion Scheme:- under this scheme, the workers are encouraged to give their suggestions and opinions to the management on various administrative matters and their suggestions are considered carefully and accepted if suitable. Also rewards are given to those who make the suggestion. These suggestions are collected every month and suitable decisions are taken jointly by a committee consisting of members from workers and management.
Grievance Procedure:- It also provides an opportunity to the workers to participate in decisions on matters affecting their interests.
Quality Circle:- It is a unique method which provides for voluntary participation by the workers in the direction of quality improvement and self-development. It was first originated in Japan and spread to many countries including India. These circles are relatively autonomous units of about 10workers, usually led by a supervisor or a senior worker and organized as work units. The worker who have a shared area of responsibility, meet weekly to discuss, analyse, and propose solutions to ongoing problems.
WORKERS’ PARTICIPATION IN MANAGEMENT IN INDIA
The idea of Participative management in India has a long history. Firstly it was introduced in 1910 and in textile industry. Soon after World War I, Tata Iron and Steel Company at Jamshedpur set up a Works Committee with workers’ cooperation. After few years this committee had to be wound up because it was not effective. At other places also Works Committees were setup but with a little success.
The Royal Commission on Labour in India also recommended Works Committees at the plant industry levels for consultation and resolution of disputes but could not make much headway. After 1940, with the emergence of tripartite labour organisation, trade unionists and political leaders demanded for labours’ association with management. But scheme of joint consultation got a firm legislative foundation only when the Government of India enacted Industrial Disputes Act in 1947. the Act made it obligatory for all units employing more than 100 workers to constitute works committees. Then Government has introduced several schemes of workers’ participation in management of which Joint Management Councils in 1956 and Shop Councils and Joint Councils in 1975 are of significance.
The idea of associating labour with management has been in the Directive Principles of the State Policy in the Indian Constitution. The First Five Year Plan made efforts to develop joint consultation and introduce workers’ participation in management.
The Industrial Policy Resolution of April, 1956 made it clear that “in a socialist democracy, labour is a partner in the common task of development and should participate in it with enthusiasmâ€¦”.
It was envisaged as the first step to labour management association. The objective of the Committee was “to promote measures for securing and preserving good relations between employer and its workers”. Sec3(a) of the Industrial Disputes Act, 1947 provides for setting up of Works Committee in all undertakings employing 100 and more workers. It consist of equal number of representatives from both groups i.e. employers and workers. They meet frequently for discussions on common problems of both groups and after discussion, joint decisions are taken and such decisions are binding on both the parties. Some matters like wage payment, bonus, training, discipline, etc. are discussed in such meetings.
In the beginning, the response of employers to Works Committee was encouraging but by the end of September 1951, the Works Committees came into existence and are 1142 in number. This initial support and enthusiasm gradually start fading away. In 1969 the National Commission on Labour found that Works Committees have not been effective.
Joint Management Councils
In 1956, a study group of representatives of labour and management was set up who visited many Western countries to study labour participation schemes. Then the study group suggested the introduction of “Joint Management Councils” for workers’ participation. The councils should be entitled to be consulted on certain specific matters. This may be related to economic situation of the concern, state of market, production and sales programme, annual balance sheet and long term expansion plans. It was provided that to be effective and more manageable, it should consist of equal number of representatives from both groups i.e. employers and workers.
Working experience of JMCs in India from 1958 to 1975 revealed a history with a rapid rise and growth as well as an equally rapid decline and fall. It has been observed that a large number of these councils existed only on paper.
Shop Council and Joint Council Scheme
The workers’ participation in management scheme of 1975 was the product of new challenge that emerged as a result of the proclamation of Internal Emergency in June, 1975. The scheme envisaged setting up of shop councils at the shop/departmental level and joint councils at the enterprise level. This was the first time when these were implemented in manufacturing and mining unit where 500 and more workers whether in public, private, or co-operative sector works.
Shop Council:- Every industrial unit employing 500 and more workers shall constitute a shop council for each department or shop or one council for more than one department or shop. All decisions of shop council shall be on the basis of consensus and the decisions taken there should be implemented by parties concerned within one month period unless stated otherwise.
Joint Councils:- Any industrial unit employing 500 or more workers is supposed to have a Joint Council for the whole unit. Tenure of the council shall be two years. Every decision shall be on the basis of consensus and not by a process of voting. The decision shall be binding upon both the parties.
WEAKNESSES OF WORKER’S PARTICIPATION IN INDIA
The schemes of workers’ participation in management have failed in India. The reasons are:
Majority of workers in India are not strongly motivated to assume decision making responsibility either directly or indirectly through representatives. Reason for this may be their lower level limited needs.
In workers’ participation in management, the employees’ representatives have to assume the dual role of spokesmen for the workers and managers. Thus such employees are required to perform two incompatible roles which creates difficulties in effective participation.
In India, more emphasis has been given to participation at the higher levels which means active involvement is confirmed only to a few and the creative potential of rank and file of workers is ignored.
There has been managerial resistance to workers’ participation schemes because they feel that workers are not competent to take decisions.
Generally, workers’ representatives are also active members of political parties. Due to which preference is given to political ends rather than to the interests of workers. This brings down the effectiveness of participation.
Participative management schemes have been inspired and sponsored by the Government. There has been a lack of initiatives on the part of managements and trade unions.
There have been labour laws which pervade virtually all areas of the work place.
The trade union movement has not yet crystallized into a definite pattern.
From the points discussed above, it may be said that conditions in India have not been conductive to participative management. The trade union movement has not yet crystallized into a definite pattern. They are still dominated by politics and many trade unionists are social parasites who are out to fish in troubled waters. So as long as it continues, workers can not be expected to show the responsibility required to ensure success of participative management.
On the side of management, there is absence of positive response to make idea work. They are not prepared to shed down the authority for reasons. Almost all the schemes of participation were creation of Government and were imposed on unenthusiastic and even unwilling management.
The idea of participative management can only work in India if managements are convinced of its merits and workers are responsible enough to make it a success. Hence it is only succeed if and only if cooperation of both the parties is there. Here success is neither only of employers nor the workers but is for mutual benefit of both parties so that grievances and conflicts can be easily solved