Phantactic Textile Limited is into the business of manufacturing different types of yarns. It also carried out marketing of different types of yarns such as syntactic yarn, cotton yarn, acrylic yarn, and many more. It is in Jamshedpur, Madhya Pradesh, and has a good infrastructure. The company has grown considerably in both abilities and proficiencies and is nearing an attractive gain from the business. The top management team comprised the title-holder (managing director), chairman, technical director, and four vice-presidents, responsible for finance and accounts, marketing, manufacturing, and personnel and administration, respectively. These vice-presidents have different executives working under them. A majority of the executives under them have done MBAs from top universities.
The technical director was an expert in yarn dyeing and, therefore, used to concentrate more on the yarn quality, depending on the quality of dyeing. The production department was under the supervision of the factory manager who reported to one of the production vice-presidents. Industrial relations were taken care of by the personnel and administration vice-president.
With the active support and cooperation of all the faculty members of business management of a nearby local university, Lenardial Management Association, an affiliate of the All-India Management Association, was constituted. Many of the industrialists, managers, as well as large business units of the city became members of the organization. The association became popular as it provided a good opportunity for the academics and the practitioners.
Dr. Alan, one of the faculty members having behavioral science specialization in the management department of the university, was appointed as the secretary of the association for five years. The university encouraged visits to different universities as a part of its extension program. After the visit, Dr. Alan used to discuss the management problem with the different organizations.
Through informal sources, Dr. Alan came to know that Phantactic Textile Limited does not have good industrial relations. Therefore, he thought of this as an opportunity and decided to visit it as a courtesy call. During the visit, Dr Alan wanted to visit the factory. The vice-president for personnel and administration was also a member of the association and, therefore, accompanied Dr. Alan. During the visit, Dr Alan found that workers’ behavior was not amenable at all and they looked at both of them as uninvited guests. After the visit, the vice-president and Dr. Alan met and Dr. Alan explained to the vice-president about poor industrial relations and lack of interest of the workers. On this, the vice-president commented that there was no reason to worry. Dr. Alan laughed along with the vice-president but hinted that the matter should be given a thought.
After several months, in the morning, some workers were having troubles with the supervisor and a quarrel took place between them. The issue was resolved with the help of other workers of the factory. The supervisor left the factory instantly and met the factory manager, who accidentally happened to be his kin. The factory manager came to the factory with the supervisor and called all the workers involved in the morning incident. There were a few other workers who joined as a mob along with the workers who were involved in the incident. Accusations and counteraccusations took place. The factory manager took out his personal pistol and fired, in which one worker died and a few workers were injured. As soon as this news spread, the workers stopped working and came out with iron rods which were used in the textile machines. They started hitting all the persons coming their way. They also killed the supervisor, the factory manager, and a few more persons from the senior management. By this time, the police came and then the matter was resolved, and a lockout was announced in the factory.
Next morning, on reading newspaper reports about the incident, Dr. Alan was upset. Being the secretary of the association, he made a report criticizing the episode and conduct of the workers. He also contacted the president of the association for the agreement to this statement, ‘If the top management cannot understand their workers, then they should warrant such action by the workers, and we should not support them’.
Questions
1. State the organizational climate that existed in Phantactic Textile Limited.
2. What if the conflict was brought forward? State the best and worst that could happen.
3. If you were the vice-president of personnel and administration, what measures would you have taken to prevent the happening of the incident?