The Incident of Foot comfort company - A case study

The Incident of Foot comfort
company - A case study
By
Seied Beniamin Hosseini
B.N.Bahadur Institute of Management Sciences,
University of Mysore, Manasagangotri,
Mysore - 570006
February -2017

Background
Foot comfort was India’s largest manufacturer and marketer of footwear products.
Footwear had made it one of India’s best known brands. By net revenue of RS 7.27 billion
and net profit of RS 304.6 Billion for year ending on December 31, 1999
Foot comfort sold over 60 Million Pairs of footwear per annum in India and also exported
product to overseas markets including US, UK, Europe and Middle East.
The company provided employment to over 15,000 people in its manufacturing and sales
operations throughout India.
Despite of all its successes, Foot comfort had one problem that was its labour. The workers
resorted to strikes at the slightest provocation throwing production schedules out of gear.
Summary of cause and solution
Cause Effect Result Possible Solution
Foot Comfort had started
outsourcing the complete
manufacture of the
power range of shoes to
China.
The company had
been outsourcing
only the assembly
and sewing line
jobs earlier.
The workers felt, the
decision had resulted
in lower income for
them and they also
feared that they could
lose their jobs in
future, if this trend
continued.
Communication
between employer and
employee and
effective stress
management.
they make their strike
intensive and garner
support from all other
union.
The company
dysfunctional for
more than 5
months.
It intensified the
pressure on the
Management.
The period of strike was
very long (Unfair-
labour-practice) it cost
company at huge loss,
Slow Down Strike was
better option which
cause less damage to
the company.
The trade union also
resave support from
political parties.
It intensified the
pressure on the
management.

The firm negotiated with
trade union and
increased the wages and
letter on intred to
agreement with workers
so that there would not
be description of work in
the future.
Apprehensive about
labour problem
spelling over to
other unit
The company entered
into similar long term
agreements with the
union at its
manufacturing unit at
Bangalore and
Faridabad.
The trade union also
receive support from
political parties.
It intensified the
pressure on the
management.
The effect of closure
on sale and production
would be minimal as
the footwear
manufactured in the
factory .
So it would shifted to
the company’s other
factories and associate
manufacturers.
New leadership of union
had refused to abide by
the wage agreement
which was expiring in
August 2001.
The management
decide Lock out, it
was declared at foot
court’s factory in
Bangalore on 08
March 2000.
300 employee lost
their jobs
Company made 300
employees as
scapegoat.
The management view
was that through it
would have to bear the
cost of maintaining an
Idle plant of three
million rupees.
Major Failures –Disadvantage Advantage Solutions
The workers felt, the decision had resulted in
lower income for them and they also feared that
they could lose their jobs in future, if this trend
continued which had cause stress on job
security.
the management of the company should provide
assurance of job security to their employee by
providing the explanation about the situation of
the company and company’s future strategy plan
and minimize the job stress.
The want of labours was simple ,Either their
salaries would have to be increased or
outsourcing of the work to China had to be
stopped ,which call collective bargaining under
ID Act 1947 But The trade union interfair
political parties and made the problem more
The principal techniques of dispute settlement
provided in the IDA. are collective bargaining,
through mediation and conciliation, problem was
going to settel ,
- Investigation by court Under sec 11 is requred
to identify the true causes of dispute such as

wide and lead the insident to the other
direction.
interfering the political parties and theire role in
dispute.
- solve the problem throuth Adjudication (court
awards )
The management decide Lock out, it was
declared at foot court’s factory in Bangalore on
08 March 2000 without making any notice or
settlement on their agreement.
Under IDA ,Sec 2 p ,12(3),18(1),18(3)
The company before lock out should make
Notice and settlement on existing agreement
which with employee were exist.
Settlement arrived in the course of conciliation
proceedings but not before the authority and
signed independently by the parties to the
settlement as result it just binds only such
members who are signatory or party to the
settlement. As result when union leader
changed, he did not abide the agreement.
Under Section 18 of Industrial Disputes Act,
1947 Settlement should arrive in the course of
conciliation proceeding before the authority.
Such settlements not only bind the member of
the signatory union but also non-members as
well as all the present and future employees of
the management.
Conclusion
In fact, the capitalist ideology, the laborers seems like a no brainer power tools to make the
return on investment, in the private sector at the fear of insolvency risks, usual solution for
this type of problems is to find a permanent solution. In this case; the solution sacrificed 300
employees by the termination of service, it sent a strong message to the other employees and
permanently break the link.
In another hand this incident came from implementation of wrong business strategy; when
the company not Paying attention to Motivation and employees Personal Ownership, when
there is no proper communication channel between employees and employers, when there is
No existed Plan Behind the Idea, when there is Passive Management in labour union
Leadership, and when the dispute parties are ahead of the strategic planning game, such
result to the laborers are not far from reality

The Incident of Foot comfort company - A case study

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The Incident of Foot comfort company - A case study