Volvo Hr practices – Focus on Job enhancement

This case discusses the efforts made by the Swedish automobile major – Volvo and towards improving the work conditions and its facilities through job enrichment programs. In its efforts to reduce employee turnover and absenteeism in its manufacturing facilities, Volvo introduced innovative job enrichment programs and Volvo followed employee centric approach. 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. * 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 Solutions for the problem * Job enrichment program were initiated to train leaders and employees to improve working conditions. * New recruits had 130 hours induction program for familiarising them with the working conditions.

* Leadership training for group leaders were organized to focus on communication skills and work welfare. * Volvo changed its organization structure in 1972. * Headquarters staff employees were reduced from 1800 to 100. * More responsibilities to staff and operations were decentralized. * Each key product line was made an independent division and geographical markets were made profit centres having professional autonomy. Job enrichment experience * 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 others jobs in the organization. * Small work groups – Teams of three to nine people were created who divided the work among them. Group members took turn to become team spokesperson. Promote sense of belongingness among workers. * Management small employee councils- To manage employees, you need to provide leadership, motivation, and expectation. Watch the employees to be sure they are doing what is required for the job. Sometimes testing the employees or creating performance tests can be motivational. It also enables workers in developing plans for welfare of employees.

* Change implementation- Involved two work areas work design and work environment. The way they worked at the shop floor was taken into consideration and improvised. The manufacturing environment the equipment’s kept clean. Issues * Understand the importance of implementing job enrichment programs in automobile manufacturing company * Get insights into how the theoretical concepts of job enrichment could be practically implemented in a manufacturing company * Understand the new system of automobile production based on the employee friendly socio-technical approach *

Debate on the efficacy of Volvo’s socio-technical approach in the long term End of socio technological approach * Lack of demand in the 1990 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. * After a decade with severe global recession in the automobile industry, Volvo realized it had to change with time.

* Volvo card unit sold to Ford in 1999. * To company had to revert to the assembly line production system. Match project It was introduced in 1983. The training was done extensively and discipline was strictly followed. There was a clarity in communication and the goals and objectives and was clearly communicated. Employees also participated in the works and tasks of the company. Full Rule * Importance of contribution * Common leadership philosophy * Grooming new team leaders * Stress on delegation of work Dialogue program

* Interaction between work group and managers – There was a platform that was made in the organization in which there was a clear talking between the work group and the managers so that a clear platform and communication was there between the employees. * Easy problem resolution- The resolution was provided to the employees of all the problems were clear concise and easy so that they can easily made the framework. * Better communication- A better communication was to be created between the employees so that they can share the information and other thoughts very easily.