Profitable Welfare

The Tatas have been known for their philanthropy, community development and employee welfare schemes for decades now. The whole Tata empire has been built on the foundation of goodwill, trust and family feeling that is cherished by every employee of the Tata group. During my 10 week internship at Tata Steel, I have seen that the work culture over here is very different from what we normally get to hear about the corporate world. The company has also received numerous awards for its corporate social responsibility initiatives. Telco colony – my birth place, built and maintained by Tata Motors is one of the most beautiful and well planned residential areas that I have seen anywhere in the world. The place is clean and green – a rare distinction for Indian cities nowadays. Plenty of temples, markets, parks and community welfare centers have been built by the company all over the place for the benefit of the employees and their families. And all this has been in place for decades now.

Some of you might say that the prime focus of any organization should be to work for profits and that welfare schemes may at best provide intangible benefits like goodwill in the long run – nothing more than that. Well, I disagree. Transforming Jamshedpur into one of the most attractive places for living with family was instrumental in attracting and keeping the best talent that was necessary for the success of the Tata group of companies. And the latest step by Tata Motors, which I’ll be writing about next, proves that profits and welfare need not be mutually exclusive.

The company has introduced a bus service for the transportation of employees. There are plenty of bus stops at convenient locations and the buses are really very comfortable – not just by Indian standards. Most employees here go to office on scooter or cycle and travelling can be a real hassle during monsoons. The bus service, which promises convenient, comfortable and quick transportation, is a boon for all the employees living in the Telco colony. Apart from this, there are the obvious environmental benefits due to the reduced traffic. Employee welfare – yes. Now here’s how they make the profits. Since all the employees are supposed to use the bus service, the company will no longer be giving any travel allowance (for petrol, diesel). With the oil prices going sky high, this move will save the company a lot of money. Also, since the only way employees can move in and out of the plant is through buses, they have no option but to report on time and keep working till they are supposed to. No personal transportation means no escape! Thus, the ‘welfare scheme’ is also expected to bring a considerable improvement in the productivity. Smart.