We have been commissioned to take over the temporary management of an Indian subsidiary of a German medium-sized company. This interim management is intended to resolve a risky situation in India and to restore the operational viability of the Indian subsidiary.
Strike and violence in the Indian branch
The workforce goes on strike again and again, even though the company has repeatedly given in to the demands - with positive expectations. The reaction from the employee side is sobering, because a compromise offer from the employer immediately leads to completely new demands elsewhere. The suspicion arises that parts of the workforce are not interested in reaching an agreement at all, but are only interested in stirring up conflicts in the company and turning employees against each other.
The biggest conflict is not between the company on the one hand and the workforce on the other, but there are bitter battles between different interest groups within the Indian workforce.
Some of the workforce has joined an aggressive union, while the rest of the workforce completely rejects it and has completely different demands. Both groups are essentially on strike in competition with each other.
It's no longer about the company, but rather about which group will be in charge in the future. The union in particular is trying with all its might to get into the company and even sends gangs of thugs to attack scabs or non-members. At the same time, protection money demands are made against the company.
These internal employee disputes are carried out on the factory premises to the detriment of the company and there is a lack of reliable negotiating partners.
“We just don’t know what to do anymore”, according to the German parent company, “There is currently no planning at all. The demands change every minute, are completely different depending on the group and we can no longer influence the aggressive fight between the union and the workforce.”
Company victims, not reason for union escalation
Unfortunately, in India it is often the case that there are disputes and competition between different unions within the workforce in manufacturing companies.
“That only has something indirectly to do with the company itself.”said Werner Heesen, division manager WB human resources® the Dr. Wamser + Batra GmbH.
“During my time as a managing director in India, I repeatedly had to experience situations in which the demands of individual groups of the workforce differed significantly from each other and the groups then attacked each other. The most amazing thing was that in the end it wasn’t about the well-being of the employees at all, but only about the benefits of certain interest groups or even individual people.”
The acute situation of the German medium-sized company in India is extremely critical: production is now completely at a standstill and it is to be feared that the disputes will be fought out with even more aggression on the factory premises in the future.
The owner summarizes: “Employees from the various factions threaten each other and do not shy away from damaging our machines and using physical violence against the other group. In many cases, these threats don't just stop; acts of violence actually take place. Large parts of our Indian administrative staff, including our local management, no longer dare to go to work and fear for life and limb.”
Crisis management and concrete measures
However, the company is dependent on production capacity in India and cannot cope with a longer production stop. There are important orders that need to be covered so that the German parent company doesn't end up in trouble. “That’s why we sought immediate and comprehensive external help”.
The Dr. A few weeks ago, Wamser + Batra GmbH began working in the background to have a de-escalating effect, to develop solutions and alternatives and to prepare the company for the worst case scenario - the at least temporary relocation of production to an alternative location.
“To do this, we had to secretly remove machines and materials from the company and transport them to a safe location.”, said Dr. Johannes Wamser, managing director of Dr. Wamser + Batra GmbH and head of the department WB turnaround management®.
We have set up a task force consisting of experts with personal management experience in similar situations in India who are currently looking after all the company's local issues. One of our interim managers is currently working as a temporary managing director on site,
- to relax the situation and restore safety for the life and limb of the employees,
- to set up temporary production at the alternative location and
- to restore production capability – no matter how – as quickly as possible.
We are also organizing a specialized team of lawyers, formal and informal negotiators and experts that we will need as we move forward. The most important insight that we have gained together with our customers in recent years is that such crisis situations cannot be solved using conventional methods and experiences from other countries. India is completely different. And accordingly, every approach must be adapted to the “Indian peculiarities”.
Dr. Wamser + Batra GmbH: Problem solvers and task force for India!
The management consultancy Dr. Dr., which specializes in India Wamser + Batra GmbH supports European companies in India. In addition to the pillars of administration, personnel consulting, purchasing and sales, the area is particularly important “Crisis management / interim management” to the company's core competency.
Experienced India experts (see, among others, Case study) who are familiar with numerous crisis situations in India and can solve them on site as interim managers. The references include both corporations and classic medium-sized companies.
