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Summary:

 ABC bearing is a global conglomerate involved in manufacture of


bearings for all types of use. It has its corporate office in Munich,
Germany and it has 12 manufacturing facilities across the globe.
 It manufactures two types of bearing:
o Oil cooled (OC)
o Air cooled (AC)
 The AC cooled bearing is used for automatic transmission and OC cooled
for manual transmission.
 ABC Chennai plant was setup in 1969 essentially to meet the demand of
the Asian market. This was their second plant in Asia, it was known for
high quality manufacturing of OC cooled bearings and this became a
cash cow for the ABC group. About 98% employees are from Chennai
southern part of India .
 Raghu shrinivasan when it first started in Chennai 1969 he was a “Young
apprentice” and he was the head of the Chennai plant in 1994. He had
gown the Indian operations as a good profitable unit compared to other
ABC units worldwide.
 Neelakantan was machine operator in 1974 and he became a COO in
1994. He was a committed production engineer and was very soft
spoken and often seen unable to take any tough decision.
 In 2009 when Raghu shrinivasan turned 65 and he retired. James Arnold
chief of international operations appointed John Marker as the new CEO
of the Chennai plant.
 John team set a new and ambitious goal “By increasing ABC Indians
revenue to 10billion market share to 60% in India by 2012 and also
double the production capacity in the next 5 years”
 In dec-2011 ABC India company performed very poor with 30% drop in
the top line and 20% fall in the bottom line. Due to disengagement with
employees, the employees decide go on strike for the first time in
history of ABC India, factory went into lockout.
Issues:
 COMMUNICATION GAP:
most of the employees in ABC company communicated in Tamil and they hardly uses
English and even if they did use English, it was hard for john to follow their accent
 LEADERSHIP ISSUES:
john discussed his ideas only with his immediate leaders in the meeting, these leaders
in turn failed to communicate these ideas to the next level manager to take any further
step to implement this plan.
 DISENGAGEMENT WITH EMPLOYERS:
john took decisions that lead to disengagement of employees. There was visible
unhappiness in workers about the decision but didn’t raise the issue to the top
management
 COMMUNITY DISCONNECT:
john didn’t attend the annual function to address the students & parents to give away
prizes and scholarship, this disappointed school Management as usually during this
function the CEO used to sanction some new buildings/labs to school which didn’t
happen this time.
 PRODUCT DIVERSIFICATION ISSUES:
The main product of ABC company consist of oil cooled bearings and so when they
diversified into air cooled bearings, were they didn’t have much of an expertise in
making air cooled bearing. This lead to poor performance in productivity

Recommendation:
 Since the employees of the Chennai ABC plant conversed in local
language “Tamil” and their English accent was very difficult for john to
follow he should have selected an employee who had good English
accent and communicated effectively with the employees.
 John should communicate face-to face with his employees rather than
communicating through e-mail and newsletter.