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Ashok Leyland Limited: Building Competitive Advantage Through Generational Diversity

CASE STUDY, HUMAN RESOURCE MANAGEMENT
ET Cases,
AUTHOR(S) : Syed Abdul Samad, Vandana Jayakumar and Dr. Nagendra V. Chowdary

Case Preview

Ashok Leyland Limited: Building Competitive Advantage through Generational Diversity

 

“Future is always in the present; it is lurking somewhere and has the tendency to show up in a manner that is not foreseen by everybody”1


“We realised that it was important for us to challenge the young executives at work and through that reinforce the reasons for them to stay on. If the organization had to change to suit the youth, so be it.”2


-- R. Seshasayee, Non-Executive Vice Chairman of the Board and Ex-MD, Ashok Leyland Ltd.


Since the beginning of the new millennium, Ashok Leyland Limited (ALL), India’s second largest manufacturer of trucks and buses, had been setting itself in a new course to compete and be at par with global standards. Till 1991, ALL was operating in a duopolistic market. Later, the Indian Medium and Heavy Commercial Vehicles (M&HCV) market became more competitive with the opening up of the Indian economy and ALL realized the need to be agile and stay relevant. The company figured that it could only become agile by turning itself young and began recruiting younger workforce. By 2003-2004, the company had 37% of young executives in its management. However, the attrition levels among these young executives increased as they felt left out due to the culture and generation gap that existed between them and the senior executives.

The company HR then took initiatives that empowered the millennial workforce and ensured their participation in crucial projects. The company also promised their growth within the company. With younger employees gaining importance, the company now saw a reversal of the problem – the senior executives now felt left out. The company then roped them as mentors to the young executives. Though these initiatives have broken the ice between the young and senior executives, the promise of growth for millennials within the company still remains to be addressed. The adverse market conditions and the cost cutting measures of the company in the recent years made ALL’s promise even more challenging..............

 



  • 1 R. Seshasayee, “Advantage India”, Vikalpa, Volume 32, No. 2, April–June 2007
  • 2 N. Madhavan, “Ashok Leyland Threatened by Generation Gap Among its Executives”, http://businesstoday.intoday.in/story/experiencevs-exuberance/1/4918.html, November 29th 2009

Teaching Note Preview

Ashok Leyland Limited: Building Competitive Advantage through Generational Diversity

 

Prerequisite Conceptual Understanding

Prerequisite Conceptual Understanding (PCU) material is the background material that would aid immensely in mapping the decision areas of this case study and bring a synthesis amongst the relevant concepts. The participants/students should be encouraged to read this material to benefit from the broader perspectives outlined in the case study.

  • 1. Rishikesha T. Krishnan, “Linking Corporate Strategy and HR Strategy: Implications for HR Professional”, Emerging Asia: An HR Agenda, Tata McGraw Hill, 2005 – To understand the link between corporate strategy and human resources strategy such that HR professionals can contribute to better integration of corporate and business strategy with HR strategy
  • 2. Sumantra Ghoshal and Christopher A. Bartlett, “Changing the Role of Top Management: Beyond Structure to Processes”, Harvard Business Review, January 1995 – To understand the larger role of processes in organizational change as compared to organizational structure
  • 3. Donald N. Sull, “Why Good Companies Go Bad”, Harvard Business Review, July-August 1999 – To understand the reasons behind why some of the best companies fail with changing business environments
  • 4. Jeanne C. Meister and Karie Willyerd, “Mentoring Millennials”, Harvard Business Review, May 2010 – To understand the concept of reverse mentoring and also the importance of feedback for Gen Y employees
  • 5. Jacquelyn B. James et al., “Generational Differences in Perceptions of Older Workers’ Capabilities”, The Centre on Aging & Work, www.bc.edu, November 2007 – To understand the workplace behavior of people from various generations
  • 6. “How Do Generational Differences Impact Organizations and Teams?”, www.birkman.com – To understand the impact of generational differences
  • 7. Paul R. Dannar, “Millennials: What They Offer Our Organizations and How Leaders Can Make Sure They Deliver”, Journal of Value-Based Leadership, 2013 – To understand the workplace attributes of millennials

 

Synopsis

Quite contemporary in nature, this case study enables an engaging discussion on the concept of workforce/ generational diversity which hitherto was largely interpreted in terms of gender diversity. As the millennials started entering the workforce at the turn of the century, organizations were faced with a unique challenge of managing workforce comprising of traditionalists, baby boomers, Gen X and Gen Y or the millennials. A case in point is Ashok Leyland Ltd (ALL), one of the leading Indian commercial vehicles manufacturers. Faced with the problem of generation gap that threatened the growth of the organization, the company initiated very innovative HR initiatives such as Mission YEs, to bridge the generation gap and place the company on the road to success. The story of ALL highlights the significance of understanding the workplace attributes of the millennials. How are the millennials different from workforce of previous generations? In what ways can organizations engage the millennials to leverage their strengths?

Pedagogical Objectives

  • • To understand and analyze Ashok Leyland Ltd.’s (ALL’s) business landscape and the emergence of its strategy curve in context to how the structure (the environment) forces a company’s strategy
  • • To understand the reasons for generational disconnect at Ashok Leyland Ltd.(ALL) and analyze the same in the light of millennials’ characteristics
  • • To discuss and debate on the initiatives taken by ALL to bridge the generational gaps to create a unified and purpose-oriented workforce and analyze the efficacy of the initiatives
  • • To contextualize the role and efficacy of corporate culture and cross-functional teams in effecting a lasting organizational change

 

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Abstract


This case study can be effectively used for a discussion on how to bridge the generational gaps at workplace. While some tout generational diversity to be an invisible competitive advantage, several others caution that if not used correctly, the same generational diversity can become an organizational stumbling block, as was the case at Ashok Leyland Limited (ALL), India's second largest commercial vehicle manufacturer. Faced with stiff (foreign) competition, in the light of deregulated business environment during early 1990s, and the following demographic changes, ALL reoriented itself to have higher composition of millennials/Gen Y in its workforce. By 2005, nearly 40% of total ALL employees were millennials. The seniors / the company veterans viewed it diametrically opposite. It was a new challenge for ALL and new problems cannot be solved by old solutions. Could ALL turn around the tables?



Learning objectives

  • To understand and analyze Ashok Leyland Ltd.'s (ALL's) business landscape and the emergence of its strategy curve in context to how the structure (the environment) forces a company's strategy
  • To understand the reasons for generational disconnect at Ashok Leyland Ltd. (ALL) and analyze the same in the light of millennials' characteristics
  • To discuss and debate on the initiatives taken by ALL to bridge the generational gaps to create a unified and purpose-oriented workforce and analyze the efficacy of the initiatives
  • To contextualize the role and efficacy of corporate culture and cross-functional teams in effecting a lasting organizational change



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