Industrial Democracy: Concept of Industrial Democracy in India!
For bringing about a fundamental socio-economic change in modern pluralistic set-up, establishment of industrial democracy is a pre-requisite. The political democracy can be really applicable only when there is emphasis on democratic administration of business mainly by workers.
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The traditional concept of industrial personnel management has been a division of whole work-force into two categories: the managers, the so-called white collar staff, representing the interests of the proprietors; and the lower level workers, the main work-force of the establishment, representing their own opposite interests.
The interface between the two groups has constituted the main field, or battle-field of industrial relations. It was supposed managers are only to manage and give orders; while the workers are to work and carry managerial orders. It means each group has separate and opposite interest. In this case the gap between the management and labour can be unbridgeable and mutual distrust will increase continuously.
Managerial framework:
Management of course, has been in practice ever since civilization started with the common goal. The major theme of managerial function is getting things done through other peoples i.e., workers. J.A.F. Stoner describes five managerial activities as: to work with and through other people, to bear the final responsibility for results, to balance competing goals and set priorities, to think analytically and conceptually and to make different decisions and assume risks.
So each and every manager has to get work with a living machine means working men. Thus strong need was felt for mutual cooperation on the place of mutual distrust between the two polars-management and workers.
The pioneer of ‘scientific Management Movement’ Frederick Winslow Taylor suggested a revolutionary approach for inductive, empirical and comprehensive thinking of each job to make optimum use of available resources.
He said, ‘substitution of peace for war . . . hearty, brotherly cooperation for contentment and strife, pulling hard in the same direction instead of pulling apart . . . replacement of suspicious watchfulness with mutual confidence of becoming friends instead of enemies.’
But the suggested mental revolution got less success due to over emphasis on production at any cost and scientific management was proved as monotonous, mechanical, anti-social, unscientific and impersonal.
Behavioural scientists like McGreger, Maslow, Herzberg, Hawthorne, likert etc., firmly emphasized the value of more democratic, less authoritarian, less hierarchically structured organizations.
The human relations or the behvioural approach to management began with the Haw-throne experiments in the Western Electric Company let to motivate workers in organizations in order to develop team work for attaining organizational goal of survival and growth.
Conceptual background:
Industrial democracy is also known as workers’ participation in Management (WPM) in the most crude and practical form. WPM and participative management terms are part of industrial democracy.
But there is clear cut distinction between the term participative management and WPM. WPM implies direct involvement of the workers in the management i.e., decision-making process in all the matters.
The Internal Institute of Labour Studies has stated that, ‘the participation results from practices which increase the scope for employee’s share of influence in decision-making at different tiers of organizational hierarchy with assumption of responsibility.’
Participative management is a method of consulting the workers and their groups or organizations in various schemes which management intends to execute. Participative management is purely consultive while WPM provides opportunity to the workers for taking direct part in decision making process” of various issues as pricing wage, dividend, labour welfare etc.
WPM is more broader and since-qua-non for industrial peace, which will create a positive climate of understanding and goodwill in which a sense of partnership can develop among workers and employees and between them and community.
Trusteeship approach:
In our country industrial democracy term is used by politicians with vested political interest. For them it is thought a vote catching device for the workers. But in its real sense it is a step for the establishment of a socialistic, non-exploitative and equalitarian economy. The trusteeship approach of Mahatma Gandhi is the essence of industrial democracy.
Gandhijee advised a revolutionary and constructive change in our way of life and thinking. He believed in the harmonious relation between capital and labour. Employers and employees both should consider themselves as trustees of the society. Management and worker should trust on each other and share the pain and benefits of each other. The law of brute should be substituted by law of man.
Gandhi approach was based on the humanitarian aspect and not any ism. The concept of industrial Democracy can boost psychological and emotional feelings of the workers by attaining due status.
Production oriented step:
The concept of industrial democracy may be much helpful in attaining the goal of production maximization. If there will be no barrier between workers and management, all will work for common goal of increasing production and improving the quality of the goods and services.
WPM may bring marked improvement in workers’ presence, behaviour, morale, loyalty, discipline, efficiency, social dignity and ultimately productivity. Management should know and think that establishment of industrial democracy is in their own interest.
Employees will feel that they are custodians of corporate property and risk so they have no moral right to destroy or misuse the corporate funds and property. Employees may feel that the management success is their success and vice-versa.
The purpose of WPM is to arouse among the workers sense of identity, belongingness and participation with a view to promote industrial harmony and maximize production. The whole hearted involvement of workers in managerial responsibility with true feelings and emotions may contribute positively for increasing the production.
“In order to attain and maintain a high degree of efficiency it is necessary that a right type of personnel is employed, who are given a right kind of training.”
The eleven point programme suggested by J.P. Warbasse represents the exhaustive list of the aims and objects of industrial democracy, which are as follows:
(i) To substitute the service motive for the profit motive.
(ii) To eliminate the large privileged incomes realized from rent, interest, high salaries, speculation and dividends.
(iii) To make more people workers.
(iv) To make more people owners.
(v) To encourage a sense of thriftiness and the sense of responsibility that goes with ownership.
(vi) To get people as neighbours working together for their common food.
(vii) To train people to administer their own industries in their own interest.
(viii) To substitute mutual aid for rivalry and antagonism.
(ix) To restore the people their long-lost control of the food supply and natural need.
(x) To decentralize control over the lines of people and to place that control with the individual, the family and the local group.
(xi) Finally promote the decline of the political states.
Indian perspective:
Industrial democracy is not a new concept for India. Trusteeship approach of Mahatma Gandhi intended harmonious relationship between employers and employees. Practically first attempt for WPM was made by Delhi Cloth and General Mills Co. Ltd. in 1938. Just after attaining the independence the Industrial Truce Resolution 1947 was passed.
The Industrial Disputes Act 1947 provided for Works Committees in all industrial units employing more than 100 workers. Joint Management Councils (JMCS), Shop and Joint Councils were established by Government of India.
On the recommendation of Administrative Reforms Commission the worker director scheme was launched with great enthusiasm. Scheme for workers’ participation in equity was also introduced. The National Front Government presented the ‘Participation of Workers in Management Bill 1990’. But due to fall of Government bill was not implemented.
In various five year plans and industrial policies Government of India has paid attention for WPM. But any WPM scheme can be effective only when the attitude of workers and managers is quite constructive and not indifferent.
In fact, WPM is very much in the interest of management also, so they should make effort to implement the schemes in effective way.
But in India, there is need for proper training of the workers and trade unions leaders so they after getting maturity they can participate in real way in managerial functions. Our ex-president Late Sri V.V. Giri has rightly opined. ‘If there is premature inclusion of workers in management either they will be brought up by the management and effectively silenced or if they are made of sterner stuff, they will in spite of the best intentions prove obstructive and resentful towards management.’
Programmes for training and education should be developed comprehensively so that workers can think, feel and act in positive way. American President Abraham Lincoln has said in Gettysburg address, ‘Government is of the people, by the people, for the people.’
In the same way industrial democracy is of the workers, by the workers, for the workers. But in lack of ‘workers’ education and training industrial democracy may be off the workers, buy the workers and far the workers. They must be learnt the art of managerial functions through proper training.
Trade unionism:
In democratic set-up like ours workers have gained much strength through unionism and expanded their role in society and economy. The fate of industrial democracy is highly correlated with the role of trade unions.
Most of the trade unions are suffering from outside leadership and intra union rivalries. Traditionally workers has been militant and aggressive demanding only welfare facilities in their own interest. They demand for rights but not for duties. Multiplicity of trade unions should be reduced for successful participative management.
Unionization should be strengthened by the slogan ‘unity is strength’ not the ‘might is right.’ ‘Rivalries are main aspect of the weakness of Indian Unionism. Most Indian Unions are weak organizationally and particularly with respect to trade union finances.
Further very few unions have full time leaders at the helm of affairs. . . . Practically all Indian Unions are led by persons who have no background in industry—that is outsiders. These outsiders are mostly middle class intellectuals with clear out political orientation in many cases.’
In course of time, when workers get better educated and enlightened, and trade unions are freed from the influence of outsiders, the question of ‘putting trade unions representatives in management can be effective.’
Workers should look and think beyond their own nose. They should use the slogan ‘Hamari magne puri ho’ (Fulfill our demands) but leave ‘Chahe jo bhi majburi ho’ (At any cost). Gunda element and muscle power should be eliminated from union leadership. With the muscle power gunda typed politicians and even mafias have become monarch of the industrial scene. Before their terrorism and violence, logic has no meaning.
They use to threaten the managerial executives in jungle law style—Yah mera faisala hai, mano nahi to dekh lunga (This is my decision, accept, otherwise face the consequence). These type of managerial problems can be tackled by workers’ awareness and strong willpower of the government by setting the rules, laws, ethics and code of conduct for workers.
For this purpose labour should be given education and training for understanding and be aware of their rights, duties and managerial position along with organizational interest. Then the comment of Sri V.V. Giri ‘political democracy will be formalistic and legalistic if it, is not supplemented by industrial democracy’ can be true. Workers’ participation in management is quite necessary for the development of healthy industrial relations which is prerequisite for rapid industrialization and economic growth.
Industrial democracy can be much meaningful for management and labour only when both have the feeling of mutual cooperation with open heart. There is need of positive alteration in the approach of both the parties for bridging their gap. Employees must feel that the success of management is their success and vice-versa.
Proper training of work-force may bring change in their approach and spirit, and then they can participate effectively in managerial process. Mutual trust between workers and management without any barrier can bring marked improvement in organizational behaviour and productivity. Industrial democracy is necessarily a momentous egress in the modern pluralistic society and should be considered sine qua non for managerial success.