EMPLOYMENT RELATIONS AND EMPLOYEE

ENGAGEMENT IN DR.REDDY’S LAB

Employment relations and employee engagement, explores an important topical concept

in Human Resource Management, namely ‘employee engagement’.Human resource management
is premised on the idea that organizational success stems from the ability to extract a greater
degree of willing employee commitment to corporate objectives, rather than merely competing
on price or product quality. The implication is that what matters is the way in which employees
choose to undertake their jobs and, crucially, the extent of ‘discretionary effort’ they are prepared
to expend. Against this backdrop, raising levels of employee engagement is the latest in a long
line of managerial strategies aimed at releasing employee discretion and aligning employee
interests more closely with managerial goals, predicated on the assumption that this will in turn
boost organizational performance.

Employees who are more engaged with their work are thus viewed to be more likely to
behave in positive and cooperative ways, to the benefit of both the firm and themselves. It is also
argued that engaged employees outperform others by showing heightened interest in their work
and being prepared to ‘go the extra mile’ for their organization. The claim has also been made
that engaged employees see their work as more meaningful and fulfilling, and appear to
experience increased job satisfaction. In this way it has been argued that there are potential
individual and organizational benefits of employee engagement.

A problem arises however when we look at empirical evidence of engagement. Studies

have shown that most employees are in fact not engaged at work – according to one study, it’s
fewer than 40%. An employment relations perspective of employee engagement is thus
somewhat more critical than the view expressed in the previous paragraph. Questions arise as to
the following issues: Who benefits from employee engagement. To what extent is it possible to
deal with external contextual constraints to achieve an engaged workforce. To what extent are
the internal contextual constraints obstacles to engagement.
 This course investigates various facets of employee engagement from a variety of
different perspectives. The discussion opens with a critique of the concept itself, as well as the
purported outcomes of employee engagement, including an exploration of both engagement and
disengagement and the link between engagement and emotional labour. Employee engagement is
then examined through the lens of its antecedents, including investigation of the concept of trust,
the impacts of partnership and collaboration, as well as employee voice, communication and
involvement. The impact of organizational change on employee engagement is also explored.

Learning outcomes

After studying this course, you should be able to:

 Describe and critique the concept of employee engagement

 Identify problems associated with both over-engagement and disengagement

 Examine the extent to which emotional and aesthetic labour are positioned in some
contemporary organizations

 Critically evaluate the measurement of employee engagement

 Identify the issues associated with employee engagement in times of organizational

change, including the role of effective communications during organizational change.

What is employee engagement?

Employee engagement is defined as ‘a set of positive attitudes and behaviours enabling high job
performance of a kind which is in tune with the organization’s mission’. The three facets of
engagement are:

 Vigour – work-related energy and mental resilience

 Dedication – being highly involved in work, feeling that work has significance, having
pride in work

 Absorption in the task – the extent to which employees are fully focused on their work.
A critical review of employee engagement

This course offers a critical review of employee engagement within the broader context
of employment relations. This is particularly important given the attention and significance
attributed to employee engagement in discussions of HRM and business success more broadly.

Engage for Success is a movement committed to the idea that there is a better way to
work, a better way to enable personal growth, organizational growth and ultimately growth for
Britain by releasing more of the capability and potential of people at work.

The first stage of our critical review is an interrogation of the concept of ‘employee
engagement’ itself. Given its prominence we might assume that engagement must be well
understood.

I defined personal engagement as the harnessing of organization members’ selves to their

work roles; in engagement, people employ and express themselves physically, cognitively, and
emotionally during role performances. I defined personal disengagement as the uncoupling of
selves from work roles; in disengagement, people withdraw and defend themselves physically,
cognitively, or emotionally during role performances.

This conception relies on a particular psychological conceptualization of identity and on

ascribing agency to the individual concerned. That is to say, it is the individual who decides
whether they are going to engage with or disengage from their work. Both these assumptions
have been challenged considerably in the academic literature and prompted much debate in the
field.

It has been argued for example that literature on the subject mostly presents engagement
as a ‘win-win’ situation without acknowledging the impact on employees. Some researchers go
further and have criticized the managerialist orientation within engagement literature for
ignoring the ‘dark side’ of engagement for employees, that is, the negative impact for employees
when management seek to increase discretionary effort to improve performance.
 Another critique of the concept of engagement is that the influences of internal and
external organizational contexts for engagement are largely underdeveloped. Specifically, it
remains to be assessed how engagement initiatives relate to the current global economic and
political climate of adversity and cost control.

In the real world of competitive business the only metric of ‘best practice’ and ‘high
performance’ that has long-run survival value is ‘most profits’. The implication is that the notion
of employee engagement is management-centric, underestimates potential conflicts of interest
and may be methodologically fraught with mis-specification.

Employment relations and engagement: a collaborative approach

Different parties in the employment relations arena have held varying views on the quest
for employee engagement. In some union quarters, engagement has been suspiciously regarded
as yet another route towards job enlargement and work intensification. Other organizational
actors have either dismissed engagement as yet another fad, or have not fully understood what it
involves in terms of management competencies. The following quote highlights some of these
issues

Types of change

1. The occurrence of the change, particularly distinguishing between discontinuous change

and incremental change.

2. The way in which the change comes about, particularly the difference between top-down
changes planned by senior leaders and emergent or bottom-up change

3. The scale of change especially differences between fine-tuning existing organizational

processes, products or structures and transformational change in which these might be
completely reconfigured.

4. Whether there is a specific ‘content’ focus of the change which might be organized around,
for example, the need to relocate, introduce new technology, the merger with or acquisition
of another company or expansion into new products or markets.
 IMPORTANCE OF EMPLOYEE RELATIONS IN
DR.REDDY’S LAB
Employee Engagement

In the following section, we report on our Employee Engagement initiatives, as well as the
programs offered by DRFHE – our channel to engage with patients, doctors and investors.
Feedback from other stakeholders has been featured in other sections in this report. Employee
Engagement

In last year’s Sustainability Report, we had stated our commitment to conducting a stakeholder
engagement exercise, to understand critical issues related to Sustainability and address them
constructively.

To get a holistic view of Sustainability as a concept and to assess the extent to which
Sustainability has become a Company-wide phenomenon, employees’ feedback was sought in
the Sustainability reporting cycle.

Employees’ Overview of Sustainability

Employee feedback was sought across two levels:

1. Interview with function heads – Senior management (20)

2. Focus groups consisting of 6-8 employees across different locations (3)

Three focus groups were conducted. Each group, comprising 6-8 employees at three different
locations – Corporate Office, CTO and FTO, were surveyed over a 60-90 minutes period. These
employees were selected on a random basis across functions, and to encourage honest feedback,
no immediate senior was present in any group.

The exercises commenced with introductions, along with an explanation of the process and the
Company’s focus areas. Individual feedback was solicited on Dr. Reddy’s Sustainability
initiatives, followed by in-depth discussions on these initiatives within Dr. Reddy’s including the
participants’ perspectives on the same. Finally, suggestions were invited on areas that needed
attention, and concluding remarks were captured.

Key Observations

Various levels of awareness were observed regarding the concept of Sustainability, ranging from
basic “Environment preservation” to “Sustainability is about long term human and social
improvement, which also benefits the system”.

All participants strongly believed that Dr Reddy’s, being in the business of pharmaceuticals, is
always contributing to society by the very nature of its operations. As a consequence, each felt
that they too were doing their bit for society while doing their day to day job.

LABS, Naandi, DRF, Power of Ten payroll giving and Sparsh were top of mind, and special
mentions were made of the “Inconvenient Truth” film, Zero Liquid Discharge, health awareness
camps, employment of differently-abled people and ‘Celebrations’ – the annual event to uphold
the “Spirit of Excellence” becoming more eco-friendly, with the usage of CNG vehicles and Tree
Plantation.

Participants also pointed out their contribution by way of safety training, programs for street
children, free supply of medicines, vocational centre for spouses, among other initiatives. On a
personal level, all mentioned their attempts to save energy and water.

It was pointed out that the Company certainly does a lot for women, through benefits like
extended leave post maternity, shorter working hours, Parichay referral scheme and crèche
facility.
Open communication channels

People in the groups were highly appreciative of Elixir – in which they or people they knew
would feature. It was read at leisure and shared with their families too. They were well aware of
Around Dr. Reddy's (the in-house circular) and the intranet portal – mydrreddys.com, and kept
up with the emails on Sustainability from the CEO and the Corporate Communications Team.

However, they felt the Sustainability Report was too long and suggested that it be changed to a
quarterly, Elixir format.
Employee Mapping

Extensive interviewing of key employees belonging to different functions provided an

opportunity to make an in-depth assessment of Sustainability awareness levels, and the actual
level of engagement and involvement in the Sustainability initiatives of Dr. Reddy’s.
In-depth interviews were conducted among the senior managers across the following functions:

 Pharmacovigilance

 Human Resources

 Supply Chain Management

 Marketing

 Environment, Occupational Health and Safety

 Quality

 Manufacturing

 Compliance

Interviews amongst these managers revealed their emphasis on driving Sustainability, across
their own function, by improving processes and innovating on an individual, team and function
basis.

Quotes from senior leaders:

"Dr. Reddy’s spans the entire value chain of the pharmaceuticals business. We are the second
largest supplier of active ingredients in the world. We have 350 ingredients which we supply not
only for our own generic business, but also to other generic companies. Basically that is one link
for access to medicines.”

“The ability, and an environment in which one is free to innovate is what we encourage. One can
easily get into new projects, explore new projects, foster new ideas, new thinking, enabling us to
be an employer of choice."
"A recent development at Dr. Reddy’s of setting up Focus Teams – who do only one job at a
time rather than the earlier system of multi-tasking – has resulted in Prioritising during the
development stage, reducing scope of errors and improved outcomes for product quality.”
"Viable Vision is enabling inventory management in the pull based system. Now we supply,
based on demand arising from consumption at each node. Even production and supply happens
based on the pull system."

Impact of Dr. Reddy’s Sustainability initiatives

Most employees at Dr. Reddy’s believe that doing their job most efficiently can be considered
their contribution to Sustainability. Some employees voiced that they were personally inspired to
contribute to Sustainability in their own way. Some of these ways were:

"My husband and I are getting involved with an NGO for underprivileged children."

"I try and recycle paper and not use plastic bags."

"I’m trying to get colleagues to travel with me in my car – indirect car pooling."

"At our unit level, we have provided notebooks to school children.”

Corporate volunteering

There exists a very strong sentiment for corporate volunteering. The employees want to get more
involved in the activities that the Company undertakes in this area. They would like to have more
formal, structured volunteering program communication.

Concept Mapping

Key concepts which emerged during the focus group discussions have been mapped on the basis
of these two parameters:

 Level of awareness – concept appreciation and understanding

 Extent of involvement – level of engagement

Providing access to affordable and innovative medicines is integral to each employee’s role and
function. Employees in turn believe that it is their primary contribution to Sustainability.
Diversity as a conscious policy has percolated thoroughly, into the system. Employees are well
aware of community development activities such as LABS, and feel proud of their Power of 10
employee giving program, as it is a direct correlation between individual contribution and
Sustainability. Awareness of specific initiatives such as Sparsh in the oncology area can be
improved among employees.

Information exchange

During the discussion, the efficacy of current information exchange media was captured. It has
been presented here by the media as per:

1. Frequency of the medium – How often the Company uses this medium to communicate

2. Acceptance – How this medium finds favour with the employees

3. Relevance – Employees’ feedback on the content delivered through this medium

4. Sustainability coverage - Extent of content specific to sustainability issues

Most of the communication facilitated by the Company for its stakeholders (employees,
specifically) is well received. There seems to be a preference for physical forms of
communication (print or in person). Also, honest feedback was received regarding the length of
communication being a deterrent for involvement, as time available for browsing is limited.
Areas needing attention

A number of suggestions were proposed on Sustainability issues requiring prompt action. These
included social projects in partnership with governments, swine flu awareness and spreading
awareness about diseases within the Company, especially lifestyle ones.

Employees went on to mention village adoption, educating children about Sustainability, rain
water harvesting, road safety, and promoting Sparsh in hospitals, among others. A few felt that
paternity leave needs to be introduced, while some wanted more action on corporate volunteering
programs.

The Company has also appreciated the employees’ feedback on the length of the Sustainability
report. This year onwards, the effort is to be much more concise. Besides, there will be no
printed copy of the detailed report. The report highlights are available through leaflets for
extensive circulation among employees and other interested stakeholders. The entire report is
posted on the website.

Beyond Employees: ‘Friends Forever’ with Alumni

A need was felt at Dr. Reddy’s, for a platform through which we could keep in touch with our
alumni. It was launched in February 2008 and called “Friends Forever”. Since then, there has
been no looking back, and it currently has around 350 ex-employees as its registered members.
They work across geographies and industries, but still have a fond nostalgia for Dr. Reddy’s.

This network application aims at keeping all the alumni connected to Dr. Reddy’s with periodic
updates on key Company events, news and messages. Recently, when the Company turned 25,
the network received more than 200 congratulatory messages from ex-employees, with
interesting anecdotes of their stints at Dr. Reddy’s. Another interesting development is that this
network serves as a medium for ex-employees to open a dialogue with the Company to explore
the possibility of returning to the organization.

We now present an overview of the activities and programs run by the Dr. Reddy’s Foundation
for Health Education, to engage with healthcare professionals and patients alike.