SHREE CEMENT LIMITED
ARPAN NAGAR (SECTION-A)
The case on Shree Cement Limited highlights the dilemma that the management faces in terms of
retaining the culture and ethos of an organization vis a viz the growth aspirations and needs of the
people. SCL combined traditional indian management practices with the contemporary management
practices. It juxtaposed indian way of implementing people initiatives with the way that was
imperative and very much necessary for organizational growth and development.
Shree cement Limited always followed a policy of people first based out of the values of a family
owned and family driven business setup that emphasises on organization being not just a group of
working executives but also as community. It was popularly known as Shree Pariwar which speaks
about the camaraderie and feeling of oneness amongst the staff members and owners, promoting
the Shree Family Culture of Rajasthan.
The company established in 1979 was primarily in the cement manufacturing business, making
humble beginnings in the 1980s and 1990s and then expanding to dominate the entire market in
northern India. Selling products under 3 popular brands – Bangur, Shree Ultra and Rockstrong, Shree
Cement Limited was ranked among the top 5 cement manufacturers in India by 2013. By the same
year, Shree Cement Limited became the largest cement manufacturer in north India having spread
across to states like Rajasthan, Haryana, Uttarakhand, Chhattisgarh, and Bihar. The company also
diversified into captive power sector and had more than 1000 MW of power plants up and running
in the country.
Shree Cement Limited was managed by family members who had remarkable educational
credentials of having studied at Calcutta University, Indian Institute of Technology, Bombay (IIT-B)
and Indian School of Business (ISB), Hyderabad. The management was in good hands and business
was growing exponentially under a booming economy and increasing investment under
infrastructure. This warranted expansion and enlargement of scale of operations to pan-India levels.
This expansion now warrants an increase in man power, the geographical spread and in the
operations of the company. The growing needs also warrant a gradual acceptance of modern
business aspects that are consistent with a fast-growing organization switching over from the people
first philosophy of SCL that worked well in its initial years. The bedrock of the growth story of any
organization is the extent of satisfied and motivated work force. No wonder the family values and
culture fostered over the years in the employees were the reasons for high level of motivation. With
growing needs when the employees need to stretch and increase their outputs and deliverables,
there were conflicts and rising dissatisfaction due to few people over-performing and not being
rewarded, while other under-performing and not penalized for a lack lustre performance.
Therefore, in 2012, SCL hired Ernst & Young Consultant to guide and suggest ways to increase
productivity, reduce employee dissatisfaction and improve employee engagement. The E&Y team
did a thorough analysis of company culture, employee motivation and engagement levels based on
multiple criterions and bucketed them in 3 baskets of Satisfaction, Engagement and Meaning /
Happiness as mentioned in Exhibit 3. Various aspects of work culture were then mapped under these
buckets. Further, the employees were asked questions through a survey to find the levels of
dissatisfaction as per the grid generated above.
There were a host of issues that were identified as reasons for increasing dissatisfaction in the work
force and that needed immediate attention in order to ensure the company is on track of a growth
path. E&Y suggested a bundle of 18 improvement projects that were focussed on recommendations
towards reducing employee dissatisfaction and attrition rates, addressing these issues. The
recommendations based on cementing the idea of people first were primarily directed towards
having a work force that is happy and driven to continually improve upon their standard of
performance.
However, these projects were sent to office of CPWO for review and further action. The major issues
causing dissatisfaction were shown in form of a pareto chart in Figure 4. Biggest reason for
discontent among work force was a flawed performance management system that disregarded hard
work and higher deliverables and cared about people and the collective sentiments that did not
penalized laggard performance. Next was in personnel and administration department where people
were more concerned about the working relations and autonomy levels directly affecting the
motivations levels. Prioritization is a challenge given there are 18 such projects and nominations are
sought for from all employees to volunteer execution of these projects. As a manager and business
owner it is in best interest to resolve any such issues that hamper long term growth prospects by
brewing dissatisfaction. It is important to note that the secret of success of SCL in its initial years was
motivates work force and in lack of it, the company may not be able to achieve its planned growth
trajectory in the cement industry.
