volvo hr practices

Focus On Job Enrichment

VOLVO’S HR PRACTICES

Presented by

E-18 Sneha Thanneru E-08 Arzoo Bista E-48

Himanshi Sahlot

E-58 Purnima Vidyarthi E-28 Parag Saxena E-38

Meenesh Pachauri

Introduction to VOLVO

Origin of VOLVO group 1927

Headquarter : Gothenburg, Sweden

Industry: Commercial Vehicles

Product: Heavy Equipments (trucks, buses, construction equipments)

The Beginning 1924 : Founded by Gaustaf

Larson and Assar Gabrielsson

1927: 1st car- OU4 & in 1929:1st profits

1934 : 1st bus- B1 & in 1946 1st diesel bus- B-56

1948: Major tractor manufacturer Separate division created in

1968

Global Entry 1939-1945 : Supply to the military 1955 : Exports to the USA New production facilities:

1963 : Canada 1965 : Belgium 1973 : USA 1980 : Bus and truck assembly

plant in Brazil 1981 : Acquisition of White Motor

corporation 1986 : Volvo GM Heavy Truck

corporation 1989 :Christer Zatteberg- new MD and

CEO 1st loss since 1929

New Era 1992 :Soren Gyll took over

“Volvo 95”programme “Volvo Strategic Development”

(1993)

1994 : JV in China to manufacture buses

1999 : Volvo Car Cooperation (VCC) sold to Ford Motor Company ($ 6.45 billion)

2001 : Acquisition of Renault trucks 2003 : Net sales- SEK 174.768 billion

: Operating income: SEK 2.837 billion

The HR problem In 1973 employees were

41,000 in company owned plants

10,000 through dealer network

15,000 through VOLVO’s sub contractors

Major labor unrest(strikes & other disputes) across Sweden in early 1970s Absenteeism and employee

turnover, VOLVO had to maintain 14%

of work force as reserve causing increased HR costs

The HR problem

Education

• Sweden’s per capita expenditure on education made its citizen more educated so accident prone factory environment was no longer an attractive proposition

Challenges

• Attracting and retaining talented workforce

• Immigrant labors Increased diversity at workplace affected work culture leading to disrupted communication system

HR solutions

Job enrichment programmes were initiated to train leaders and employees to improve working conditions

New recruits had 130 hours induction programme for familiarizing them with working conditions

Leadership training for group leaders were organized to focus on communication skills & worker welfare

Cont..

VOLVO Changed its organization structure in 1972

Head quarters staff employees were reduced from 1800 to 100

More responsibilities to staff & operations were decentralized

Each key product line(cars, buses etc.) was made an independent

division & geographical markets were made profit centers having

operational autonomy

Job Enrichment Experiments

JOB ROTATION

MANAGEMENT-EMPLOYEE COUNCILS

SMALL WORK GROUPS

CHANGE IMPLEMENTATION

EMPLOYEE ORIENTED FACILITIES

Job Rotation

Involved shifting of employees from one

job to another

Workers were made

to go for jobs

completely different from the previous jobs

Made workers

well versed

with other jobs in the organizatio

n

Small Work Groups

• Teams of three to nine people were created who divided the work among them

• Group members took turns to become team spokesperson

• Promote sense of belongingness among workers

Management Employee Council

Enhance employee participation

Enabled local work councils to handle issues

Enabled workers in developing plans for welfare of employees

Change Implementation

Involved two work areas- work design and work environment

Work design – the way they worked at the shop floor was taken into consideration and

improvised

Work environment- the manufacturing equipments were

always kept clean

End of Social-Technical Approach?Lack of demand in the 1990’s forced the company to stop the progress of its job enrichment initiatives.

Operations at the Kalmar and Uddevalla plants were suspended which ,however, reopened in 1993.

Volvo’s productivity was far behind Japanese and US plants.

Experts felt that there was a mismatch between the amount of money spent on training and the results.

End of Social-Technical Approach?

After a decade, with severe global recession in the automobile industry, Volvo

realized it had to change with time.

Volvo’s car unit sold to Ford in 1999.

The company had to revert to the assembly line production system.

New HR initiatives

The match projec

tFull rulle

Dialog

The Match Project

Introduced in 1983

Training extensively

Discipline

Clarity in communication

Employee participation

Full Rulle

Stress on delegation of work

Grooming new team

leaders

Importance of

contribution

Common leadershi

p philosoph

y

Dialog Programme

Interaction between

work groups & managers

Easy problem

resolution

Better communicat

ion

Thank You