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Mapaging Sur plus Staff

Do not let what you cannot do interfere with what you can do.

John Wooden, US basketball coach.

Author: V. Narayan

Locations: 2.1.3 Petroleum Refinery

Background

In poor countries, unemployment levels are often high, as it was in this case. Prevailing wages were low, so it became easy to hire more people than necessary. We had many layers of staff in maintenance; the actual proportion of useful workers was perhaps 40% or less. The nonproductive workers affected output in two ways: first, by producing little themselves and second, by slowing down the productive workers. They were not inherently bad or unskilled. Under different circumstances they could have been quite productive themselves.

The company was part of a very large multi-national oil company. The message from corporate headquarters was to de-layer and downsize. That part was hard to swallow but do-able. The difficult part was what to do with the surpluses. Social legislation in the country made it close to impossible to fire them. Also, the damage to the industrial climate was perceived to be more serious than any economic gain.

I did not play a role in these events. What follows is based on my observation of the Managing Director's leadership.

 
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