Move aimed at creating a flatter organisation as co looks to establish an environment in which teamwork-inspired creativity can flourish
Tata Motors, India’s largest automobile company by revenue, has decided to scrap designations and create a flatter organisation as it looks to establish an environment in which teamwork-inspired creativity can flourish. Designations such as general manager, senior general manager, deputy general manager, vice-president and senior vice-president are among those that will be consigned to the scrapheap.
The company told employees in a circular on Wednesday that the move will create a “mindset free of designations and hierarchy“.About 10,000 employees of Tata Motors will be affected by this move, a senior executive said.
All managers with a team reporting to them will simply have the job title of `head,’ followed by the function or department after their names. Employees who are individual contributors, are largely at the front end and do not have any team member reporting to them will use just the function or department after their name.
The human resources recast, among the most sweeping in corpo rate India in recent times, will lead to a flattening of hierarchy levels to five from 14. “More number of roles have moved than people. People need to grow in terms of breadth and depth. We need to break the silos across the functions,“ said Gajendra S Chandel, chief human resources officer at Tata Motors.
The company expects that the move will help Tata Motors put in place a work culture that’s in line with those at global companies, especially service organisations.People can now focus on work instead of their designations, Chandel said. The move will enable the company to move away from routine promotions that an employee gets purely by virtue of time spent in harness. “There will be no timebound promotions now, and promotions will happen only if there are vacancies,“ Chandel said.
The response to the move has been mixed, with younger employees reacting with greater enthusiasm than those older, ET has learnt.
Under Guenter Butschek, Tata Motors has been seeking to refresh its passenger car lineup to regain market share.Over past few years, the company’s earnings have been propped up by its Jaguar Land Rover unit as local car sales have slumped.
“We lost count of the designations we had given,“ Chandel said. But with this move, he said, the company hopes to bring back its focus to the task at hand and also help cross-functional roles for employees.About 2,500 positions have been vacated, which will eventually add to the bottom line.
An expert pointed out that designations have traditionally been one of the top five motivating factors for Indians. “Flat organisations are helpful in terms of communication and quicker implementation on the ground,“ said VG Ramakrishnan, MD at consultancy firm Avanteum Advisors. “Removing the designations may not necessarily be the right thing to do. Indians generally place a lot of emphasis on hierarchy and designation, but how the company is going to balance the aspiration of its young workforce versus the need for a flatter organisation given the premium that Indians lay on social hie rarchy needs to be seen.“
He added that there are critical differences between Indian workplaces and those overseas. “Indian culture is a complex culture. A small change in designation every year goes on to be a big motivator for a lot of people every year,“ he said. “ At some point in time, money is not everything.“
Tata Motors hired Accenture to devise a strategy to prepare the company to face competition. Scania, Bharat Benz and Volvo are leaner and meaner in comparison.Market leader Tata Motors has been facing aggressive competition in the CV space from these companies.
Source : The Economic Times