Various Techniques of Rationalisation
The Various techniques of Rationalisation are:
1. Standardisation and Simplification: Standardization and simplification of products must take place. Simplification means that the number of varieties gets reduced. Standardisation and simplification have the most beneficial effect in a number of ways: (i) There are reduced costs due to a lesser number of varieties because per capita designing costs, etc. gets reduced. (ii) Greater Efficiency also increases due to reduced lines as the firm or industry has not to cop with the problem of production and marketing of a number of varieties.
2. Specialisation and functionalisation : Greater standardization would naturally lead to greater specialization. It is realized that no single unit can produce every variety of goods. Hence the need for specialization is must mean for the introduction of the concept of functionalisation in its rational form.
Specialization means that the manufacture of products is allotted to the different units on a specialized basis. Further, the markets may be specialized, i.e., it may be divided product-wise or territory-wise among different members. As applied to workers, the principle of specialization means the performance of only one of an infinite small part of the whole product by a particular worker. Functionalization means an application of the principle of specialization to supervision and management. In simpler words, it is the introduction of scientific management to the internal organization of a particular enterprise.
3. Mechanisation and intensification : It is quite likely that greater specialisation would lead to splitting of work into many specialized parts and which in turn would mean greater mechanization. Rationalisation may not necessarily mean more mechanization because Rationalisation aims at cost reduction. However, it is quite a usual feature of Rationalisation. Sometimes Rationalisation may mean only intensification. Intensification implies that men and machines are moved at a greater speed to increase output.
Rationalisation in general, adversely affects the employees of the organisation. They lose their jobs and mechanisation of business lowers their importance. This creates innumerable hardships for them and their families. To ensure that Rationalisation dosen’t affect employess in a negative way, following steps should be taken:
1. The assistance of all the parties i.e., labour industries, government and consumers should be taken.
2. Workers should be given participation in management.
3. Worker should be trained for the use of new machines.
4. The planning of Rationalisation should be implemented in all areas (Financial, Managerial, Technical etc.) of Industries.
5. Collective efforts should be made by Indian Industrialists for its success.
6. Suitable policy should be adopted by the Government.
7. It Financial Institutions should be established to provide long-term fianance.
8. Attitudes of Labour and Industrialists should change.
9. Amicable settlement of the sharing of surplus amongst producers, workers and the community.
10. Least retrenchment; and provision of alternative employment for workers.
11. Work-loads to be determined with the help of scientific investigation analysis.
12. Labour unions to be invited to co-operate so that there is a mental change in the workers.
13. Since rationalisation increases the export competitiveness of an industry, the Government should also share in the costs of rationalisation… This diminish the risks of investors.
14. The Government should also clearly state its industrial policy regarding that industry so as to re-assure investors.
