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Q5. How are technological changes influencing the IR-Climate?

Ans. New, advanced technologies offer opportunities and pose threats. Enterprise strategies
introducing advanced / new technologies impact the whole range of problems concerning
human resources, including those relating to employment, occupational profiles, training,
working arrangements, managerial styles and attitudes, and industrial relations.

Most advanced technologies have three kinds of impacts on people: (a) replacing routine,
repetitive, unskilled, dirty, dangerous and drudgerous jobs and deskilling skilled jobs; (b)
shifting control over work away from workers to management; and (c) technological
determinedness (the imperatives of using advanced technologies in certain sectors) minimizing
the scope for sovereign decision-making at the enterprise and economy level.

Technological advances cause the following concerns among people:

1. Employment Issues

The key question / controversy concerns whether or not technology creates or destroys jobs. It
creates new jobs that are different from the old jobs either in terms of the skills required or in
their sectorial and or geographical location. New technologies are usually less labour intensive
and result in workforce redundancies. In the long- term, new technologies can have a positive
effect if they vastly improve the demand for the products/ services.

2. Changes in Occupational Profiles

Technology works in two ways: de-skilling in certain occupations / jobs and re-skilling in others.
The institution of new and improved technology affects the size and composition of the work
force and the network of social relations among employees. Technology is also facilitating new
forms of international division of labour in the form of outsourcing and offshoring of jobs. This
is resulting in the shifting of routine, repetitive and less value-adding jobs.

3. Education and Training

Advanced technology requires not only more literacy, but also numeracy because workers
become responsible for quality control using statistical quality control methods. To become
flexible and adaptive, they need to learn to perform multiple tasks and move beyond the
narrow areas of work and specialization.

4. New working arrangements and Managerial Attitudes

New technologies have necessitated work round the clock and throughout the year, blurring
the distinction, in some cases, between work and home. Multi-tasking takes away the built in
idle time with complaints about people being made to work as robots.

There are two types of work-rule changes that result from the introduction of new technology:
(a) those that leave the existing organization of work intact, while making it more efficient, and
(b) those that change the system itself. The former category of changes, which seek to combine
duties and eliminate superfluous jobs, would be conducive to higher productivity and greater
efficiency and, as such, should not be resisted.

5. Industrial Relations

New and advanced technologies have implications for trade unions and labour- management
relations. The union that represented manual workers was different from that which
represented mechanical workers. Inter-union rivalry created hurdles because the change was
perceived as a personal loss for one union and a gain for the other. When workgroups are
dismantled and new groups are formed, the changes in the social system affect the dynamics of
trade unionism and industrial relations system in the company.

New and advanced technology brings:

i. Knowledgeable and skilled workforce

ii. Direct participation to indirect / representative participation

iii. Issues open to negotiation and collective bargaining

Management Strategy / Approach

The strategic options available to managements when implementing new technology could be
classified into either of the following two:

a) The market situation influences the firm’s human resource strategy. For instance, if a
company operates with in stable product market characterized by mass production, and if
labour is abundantly available and weakly organized, then a strategy of de-skilling and
downgrading may be unproblematic. On the other hand, in situations where products change
rapidly, where small batches are the norm, and where the labour market is tight, longer term
employment and flexible deployment are the more appropriate strategies.

b) In situations where societies have become more democratic and the workforce more
educated, managerial ideology has focused on new, more humane and democratic forms of
work organization and worker participation / involvement.

Management usually seeks to attain one or several of the following objectives through
technological changes:

• Reduction in production cost

• Reduction in labour input in work processes

• Greater efficiency of operations through better management control over production

• Higher quality of products / services

• Adapting production to the changing demands of customers

• Getting a comparative advantage

When management seeks to introduce technological changes mainly to cut labour costs, trade
unions naturally resist. Instead of cutting cost, if the focus is on value addition, labour does not
automatically become redundant. It may require up gradation of skills. If technologies are used
to cut non-labour costs, trade unions will be less and confined mainly to issues such as gain

Management must communicate clearly the objective of the proposed change(s), its likely
impact on jobs and people. Along with this initial communication / information sharing,
management must also invite employees and their unions to come with alternative proposals /
suggestions concerning the subject.

The dominant trend, however, is to adopt a participatory approach in labour- management

relations before introducing changes and new technology in the workplace. Such cooperation
covers several aspects, such as the following:

• Information sharing

• Consultation

• Management commitment to avoid/ minimize adverse effects on workers

• Worker’s skills training and up-gradation

• Measures to ensure worker’s health and safety

• Sharing the gains with employees

• Trade union participation

The reasons why trade unions resist technological change are as below:

Fear of Unemployment

A major cause of resistance to technological change is the fear of unemployment that results
from such change. Through the problem largely concerns the unhired employee - since, in the
Indian context, lay-off and retrenchment generally arise due to industrial sickness and not
rationalization or automation or technological change of one or the other type - trade unions
insist, perhaps as a survival strategy in the long run, that they are deeply concerned about the
generation of employment potential and the removal of unemployment.

Lack of identification of major Benefits of Improved Technology

By and large, in the Indian industry, the capital-intensive new technology has not contributed to
cost reduction to the desired extent. The database is so poor and inadequate that management
has usually not been able to identify separately the contribution of labour, technology and
capital to the productivity increase wherever they occur and analyze the effect of technology
on cost of production, earnings of employees, and return on capital.

Workers Hardest Hit by Modernization

If a firm is not performing well and if its modernization is considered inevitable it is generally
made out that surplus labour therein should be dispensed with or redeployed. The realization
among workers that the process of modernization would affect them alone prompts them to
resist such a process.

Negotiated Change

Management tends to consider the introduction of new technologies as their prerogative. The
management’s main interest is to make work organization lean, flexible, adaptive, competitive
and viable. They are usually willing to give guarantees against redundancies through attractive
voluntary separation packages; skill training for continued employability, and redeployment
with or without retraining

Appropriate Training

New technology by itself will not step up productivity. The use of new equipment and
technology is a function of human skills coupled with dedication and commitment to work.
Hence, appropriate training in the use of new technology and employees’ participation
becomes essential for the successful introduction of technical changes. Unless those closest to
the technology are trained to recognize the problems and have the authority to take prompt
remedial action, mishaps can occur and destroy costly equipment.

Accent on Teamwork

Highly automated technology, such as that for the continuous processing of oil refining, paper
and pulp mills, and food processing functions, is best in enterprises where the accent is on
teamwork at the lowest levels and there is a minimum of hierarchy. Fuller involvement of
employees at all levels in introducing technological changes is vital to reap the fruits of
technological changes.

Supportive Management Practices

Technological changes bear fruit if they are accompanied by supportive management practices
and a congenial climate for union- management cooperation. There is a need for a joint effort
by unions and management to scientifically study various aspects of technological changes.

The 15th session of the Indian Labour Conference observed, in its resolution on technology
without tears, that three principles should guide technological progress:

(a) Protection of employment and wages of employees

(b) Equitable share of gains among members of the community, employers, and employees.

(c) Proper assessment of workload and working conditions.