About OD in public and private enterprises

1. INDIAN EXPERIENCE OF OD
IN
PUBLIC & PRIVATE ENTERPRISES
Presented by,
Jincy Joseph
Remya Jacob

2. PUBLIC ENTERPRISES
Definition
 A public sector enterprise may be defined as
any commercial or industrial undertaking
owned and managed by the government with a
view to maximise social welfare and uphold the
public interest.
 Public enterprises consist of nationalised
private sector enterprises, such as, banks, Life
Insurance Corporation of India and the new
enterprises set up by the government such as
Hindustan Machine Tools (HMT), Gas
Authority of India (GAIL), State Trading
Corporation (STC) etc.
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Characteristics of Public Enterprises
1. Government Ownership, Control and
Management
2. Financed from Government Funds
3. Public Welfare
4. Public Utility Services
5. Public Accountability
6. Excessive Formalities

3. Public
Enterprises
Departmental
Undertaking
Statutory (or Public)
Corporation
Government
Company
Example
1. Posts & Telegraph
2. Railways
3. All India Radio (AIR)
4. Door Darshan (TV)
5. Ordnance Factories
Example
1. Food Corporation of India
2. Industrial Finance Corporation
of India
3. Life Insurance Corporation of
India
4. Unit Trust of India
5. State Trading Corporation
Example
1. Hindustan Machine Tools
Limited
2. Steel Authority of India Limited
3. Hindustan Shipyard
Limited
FORMS OF ORGANISATION OF PUBLIC ENTERPRISES
in India
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5. IMPORTANCE OF PUBLIC SECTOR ENTERPRISES
 Balanced Regional Development.
 Boost the basic industries of an economy.
 Concentrate on public welfare activities.
 Promote exports.
 Price control of essential goods.
 Limit the influence of private monopoly.
 Ensure security of the country.
 Minimise the economic inequalities.
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6. CURRENT SCENARIO:
At the commencement of first five-year plan Government’s investment was
Rs. 29 crores in five central public sector enterprises. Now it has increased to Rs.
3,93,057 crores in 239 enterprises as on 31 March 2006. The public enterprises have
played a significant role in Indian economy. But the overall performance of most of
the public sector enterprises is not satisfactory. The government is taking every step
to revive and restructure the public sector enterprises to improve their
performance, productivity and profitability. Major emphasis has been given on the
sick and chronically loss making enterprises, which are capable of being revived. On
24 July 1991 the Government of India announced its Industrial policy to improve the
performance and portfolio of public sector enterprises. The new economic policies
also emphasised on liberalisation, privatisation and globalisation. The role of public
sector was redefined. To grant autonomy and delegation of financial power to some
of the profit making public sector enterprises Government has given them the status
of Navaratnas and Miniratnas.
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7. ORGANIZATIONAL DEVELOPMENT AND CHANGE
FROM TEXT – (PAGE NO : 166 …)

8.  In today's highly turbulent business environment, 'change' has become an
inevitable part of life. Organizations that do not change when needed or are
not sensitive to the need for change do not survive long.
 Organizations, in order to be successful, need to place a high priority on
proactivity (acting in advance to deal with an expected difficulty; anticipatory)
and systematic understanding of organizational issues and on responding to
current and future external customer needs.
 Emergent need for O.D. in Indian organizations….?
-highly volatile political and economic environment.
-standing up to global competition .
-move away borrowed technologies to their own technological
developments.
-more concentration on Research and Development.
-drift away from relationship and people driven organization to more
competent, skilled and professional employees who are rather system
driven.
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9. Evolution of OD in India
 In India, O.D. and planned change started in the early 1960s.
 In the mid-1970s, O.D. was first introduced in India in Larsen and Toubro as a
formal and structured part of the HRD department.
 There have been several efforts to apply O.D. approach and associated
techniques in India but it has not created the desired impact.
 A deeper examination of values embedded in Indian religion and psycho-
philosophy suggests that the cultural values are indeed largely supportive
of organizational renewal and change. Based on which new approaches and
designs of O.D. interventions may be possible. And such designs are likely to be
accepted more readily in the country.
 After Liberalization , the application of O.D. technology has increased .
(Reasons  Text pageno : 167)
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10. EXPERIENCES OF INDIAN ORGANIZATIONS WITH VARIOUS
ORGANIZATIONAL DEVELOPMENT INTERVENTIONS (ODI)
 Among available O.D. interventions and tools, the most prevalent
ones and those that have met with reasonable success in effecting
the desired change are:
* Training
* Action research
* Survey feedback
* HRD and HRD Audit
* Role focused interventions
* Person focused interventions
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11. 1) TRAINING AS AN O.D. INTERVENTION
 Dynamic, multifaceted and interactive training .
 Training advantages :
 raises the consciousness of participants,
 makes people aware of the gaps between practical and theoretical approach,
 provides a common language to articulate shared problems and difficulties ,
 generates ideas for change, and
 creates greater positive energy for change.
Example : Chemcorp , public sector unit in Manufacturing Chemicals
Some other points : -
o Cultural Change
o Convergence Effect
o Transformational Change
o Focal Intervention Technique
TEXT PAGE NO : 168 – 171 JINCY

12. 2) ACTION RESEARCH
 Action research is a data based problem solving model that replicates the steps involved in the
scientific method of inquiry. As an O.D. intervention, action research has pointed out to more
efficient resolution of practical problems, better understanding of ground realities by social
scientists and generation of new insights for theory building.
 Example : - Case of the Indian Chemical Company (ICCL) was facing a serious problem of
conflict between the materials department and the user department. ---- ( From Textbook )
-Issues
-Recommendations
-Follow up and Findings
-Loopholes
 Thus action research, as an O.D. intervention served in
-cultivating a climate of increased collaboration,
-participation and involvement,
-increasing interdepartmental interface.
-As the employees became self reflective,
- meaningful solutions arose for practical concerns & problems,
-but more importantly there was a development of self-help
competencies to deal with problems of the future.
TEXT PAGE NO : 171 – 173 JINCY

13. ICCL
Issues
Follow up and
findings
Loopholes
Recommendations
Example Public Enterprise

14. 3) SURVEY FEEDBACK
 The survey feedback has been used extensively by T. V. Rao , in a various
capacities:
* As a sensing instrument (Used by Crompton Greaves and Larsen & Toubro (L & T))
* For organizational improvements (Voltas, in 1988-89)
* For strategic shifts in structure, styles & personnel policies
* For team building
* For initiating cultural changes (Mafatlal group)
* For developing motivating climate
TEXT PAGE NO : 173 JINCY

15. 4) HRD AND HRD AUDIT
 Perhaps India is the first country to formally establish a totally dedicated
HRD (Human Resources Development ) Department separated from the
Personnel Department. This was designed in the year 1974 when the term
HRD itself was not very popular in the USA. Two consultants from the Indian
Institute of Management, Ahmedabad Dr. Udai Pareek & Dr. T V Rao after
reviewing the effectiveness of the performance appraisal system and
training in Larsen & Toubro recommended an Integrated HR System to be
established and the department dealing with development issues be
separated out from the personnel department and be called the HRD
department. Thus the first HRD department was established. It was followed
in the banking sector by the State bank of India and its Associates to start a
series of new HRD departments.
TEXT PAGE NO : 174 JINCY

16. 5) ROLE FOCUSED INTERVENTIONS
 Role Clarity : “ Whenever there is a restructuring exercise ,“role clarity”
becomes an issue. ”
 Role Negotiation Exercises : “have been a very common practice to build a
collaborative and synergistic culture. ”
 Udai Pareek„ s book 'Managing Organizational Roles' is a classic book
and is widely used in India.
 Role efficacy lab (REL)
* REL is a short process oriented program to diagnose the level of role
efficacy in a group of employees in the organization and take steps
to raise that level.
* Role efficacy as a concept was formulated by Udai Pareek.
* RELs are also very common in India.

17. 6) PERSON FOCUSED INTERVENTIONS
 This have great relevance to various HRD subsystems like
training, performance development, counseling, etc.
 These interventions can be mainly classified as :
1)Participant active interventions
2)Self Assessment through feedback on Instruments (SAFI services)
3) Facilitator Active Interventions
4) 360 Degree Feedback Based Interventions
5) Achievement Motivation labs
6) Extension Motivation

18. CONTI….
* They are normally done as a part of training or restructuring interventions. As a
training tool it aims at enhancing role efficacy.
The objective of such an intervention is :
- to enable understanding of individual and group
commitments with the top management and organisation,
- creating an opportunity to get moral support and reinforcement from
the top management and
- providing a forum for top management to comment on the
managers„ expectations and accordingly prepare action plans.
 Role Stress : In relationship oriented culture, employees may have to perform
multiple roles and thus they may suffer from work related stress. So for managing
role stress , Role Stress Programs have also been conducted by Indian
organizational development practitioners.

19. PRIVATE ENTERPRISES

20. PRIVATE ENTERPRISES
Definition
 It is a business unit
established, owned, and operated by
private individuals (company founders
and/or their families and heirs or by a small group
of investors. Sometimes employees also hold
shares of private companies) for profit.
 Most small businesses are privately
held.
 Private companies may be called
corporations, limitedcompanies, limi
tedliability companies, unlimited
companies, or other
names, depending on where and how
they are organized.
REMYA
Advantages of Private Enterprises
Limitation of liability
Lower taxes
Limited company accounts and
sole trader basic accounts.
Additional financial
consideration
Administration, management
and business standards……

21. PRIVATEENTERPRISES
In 2008 the 441
largest private
companies in the
us accounted for $
1.8 trillion in
revenue and
employed 6.2
million people
according to Forbes
 a privately held company is a
business company owned by either
non-governmental organizations or by
a relatively small number of share
holders or company members which
does not offer or trade its company
stock to general public. On the stock
market exchanges but rather the
company’s stock is offered, owned
and traded or exchanged privately
more ambiguous terms for a privately
held company are unquoted company
and unlisted company

22. REMYA

23. EXAMPLES
 Japan’s local expertise is rated world class.
 Multi-nationals are rushing to setup operations in
centre's of excellence in Asia.-particularly in india.
 TATA,RELIANCE,ONGC,IOC,RANBAXY,AUROBIN
DO PHARMA,INFOSYS,WIPRO…
 ICICI,HDFC in private financial sector.

24. . In india the private limited is used
after a name of a company which is
privately held unlike public companies
which use the word limited only.
 Director is officially an employee of
the private limited company

25. INDIAN ODI: ISSUES INVOLVED
 OD is the process of applying behavioural science
to systems,structure and different processes of an
organization.
 It is very critical to determine what the organization
really needs- incremental changes or radical
transformations.
 Overall structure of the organization needs to be
analyzed thoroughly before launching any ODI.
 Internal politics is more complicated.
 Solutions emerging out of ODI should be accepted
by top management.
 Communications and information systems should
be well established.

26.  For managing change actions taken may be unrelated to the ODI or
never explained to the targeted audience.
 Interpersonal relations are highly sensitive. A small disagreement
may lead to post-learning operating environment meaningless.
 The pull effect of future aspiration works better than push approach
through change.(sustainability of change).
 Concerns about role of leadership, articulating processing and
sharing vision
 implementation, communication of change and empowerment of
organizational members during the period of change.
 Only consider the functional ones prevailing as cultural
norms, attitudes, beliefs.

27.  OD was initialy pushed by india-UK and indian- american
collaborations.
 due to globalization, severe competition, most organizations
are continuously working on modifying their strategies.
 Focuses on system, structure, processes, and organizational
behavior.
 Continuous effort to make managerial, social as well as
political adjustments. . Areas of improvement, diversification
of Indian industry are also identified using OD.
 Almost every organization have structured organizational
development departments or facilitators in their organizations.
 Orzns enhance the capabilities of their leaders for keeping up
with the externally driven requirements in order to initiate
change.
OD: CURRENT SCENARIO

28.  Companies approach trained practitioners in india
when they plan to institute any change in their
organization.
 Indian school of business has organized a global
OD summit in this, different aspects related to
creating sustainable development through
organizational development

29. OD: FUTURE
 At every point of change ODI is a must.
 The young generation feel that they are in the
knowledge world while the old feel that they are
leading a discipline and culture taking the orgzn
they have been serving to the heights to which it
moved today.
 Problem of attrition on one side and lack of persons
with right skills.
 Innovation come from the people who go in tune
with the orgzn capabilities.

30.  Feeling confident to take risk path is the rock bed of
change.
 Political uncertainties, economic expediency
, several laws and regulations governing the
enterprises
 The investors in the company demand for justifiable
share in growth, the suppliers need bills to be paid
on time, the shop floor leaders require all the inputs
required for running their machines

31.  In future investments should be done in research
and development
 Example
 Dhoni,as cricket captain demonstrated to the world
that taking the team along required trust and
confidence in the colleagues and himself
 Mutual confidence is the future challenge of
companies.

32. Difference
Between
Private
Sector
Enterprises
&
Public

33. Basis of difference Private sector enterprises Public sector enterprises
1. Objective Maximisation of profit. Maximise social welfare
and ensure balanced
economic
development.
2. Ownership Owned by individuals. Owned by Government.
3. Management Managed by owner and
professional managers.
Managed by Government.
4. Capital Raised by owners
through loans, private
sources and public issues.
Raised from Government
funds and sometimes
through public issues.
5. Area of operation Operates in all areas with
adequate return on
investment
Operates in basic and public
utility sectors.
Difference Between Private Sector Enterprises & Public Sector Enterprises
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34. EXAMPLE FOR PRIVATE ENTERPRISE
When icici bank merged with bank of
Madura(BoM), there where many issues involved:
Staff strength of icici is lower
than BoM
Size of icici was 3 times
bigger than BoM.
Half of the employees of
BoM where subordinate
staffs.
Large differences in
profiles,designations,salaries

35. RESULTED IN:
Employee
dissatisfaction
Whether rural
branches
would
continue or
not
Position
problem
Feeling of
push up for
productivity

36. SOLVING PROBLEM
 Icici bank was established in 1994,second largest
bank in india and among the top 150 in the world..it
is a universal bank ,offering well diversified portfolio
of financial services.
Reasons for resistance
• Job security
• Lack of effective
communication
• Rapidity and extend of
change.
• Group resistance.
• Emotional turmoil.
• Loss of power and control
• Technology.
• Acquisitions and mergers.
• Women power.
Management of change
• Participation and involment
• Communication and
education.
• Leadership.
• Negotiation and agreement.
• Willingness for the sake of
the group.
• Timing of change.

37. MANAGING RESISTANCE TO CHANGE
 Change ultimately affects the people in the organisation.
 It is always better to explain why change is necessary.
 What benefits are likely to accrue as a result of change how
these benefits are to be shared by the employees and the
organisation.
 There is a general notion that benefits from change accrue to
the organisation and management at the cost of its workers.
 Without full cooperation of workers no change can be
planned, implemented and its benefits enjoyed.
 Different combinations of different techniques have to be tried.
 Organizational culture is important.
 According to force field analysis, a decision to implement
change has been taken,it is necessary to identify and
understand what forces are likely to push change and what
forces are likely to restrain it.

38. SOLUTIONS
Communication
open
Culture
identification
intranettechnology
Training for job

39. CONCLUSION
 Legal and regulatory facilitation is moving in
tandem with the world trade organization
agreement requirements.
 Future challenge for Indian companies lies in
HRM, organizational innovativeness and
technological excellence with high market
penetration.
 Appointment of right change agents, consultants for
OD interventions and putting in place monitoring
and implementation mechanisms.

40.  ODI is seen as reactive instrument to bring about
radical change in the organization.
 It is always important to have a strong monitoring
and implementation mechanism for the ODI to
succeed.