Deakins India Pvt. Ltd.: Human Resource Issues in a Small-Scale Unit

Deakins was a Delhi-based leather garments manufacturing small-scale enterprise (SME), which operated exclusively in the exports sector by employing mostly piece-rated workers. The company had recently begun facing severe competition from the Chinese. It noticed threats on the employee relations front too. It did not have any system of formal training. The company's two directors were aware of the need for change of mindsets and professionalism even as they were diametrically opposite in their management style—while one was considerate and paternalistic, the other believed in control and discipline. The former's style enabled the company to use its “loyal workers†in diluting the designs of the outsider union activists so far. The company did not strictly follow many of the labour laws applicable to its workers. It was exploring ways for competing with the Chinese. It noticed that some Indian competitors had established themselves in European market where the influence of Chinese suppliers in these products was negligible. Some had recently left for China to set up joint ventures there with the Chinese operators; some others had gone into production of high-quality customized leather garments. The two directors were wondering what strategies and styles should be adopted by them to continue to remain and grow in business in view of the current crisis. They were exploring whether the company's business model and people-management policies needed any change. They were also asking whether there was any relationship between people management issues and employee relations dynamics