MUMBAI, December 23: Mahindra & Mahindra on Tuesday announced the signing of a historic wage agreement with its union at its automotive plant at Kandivali, paving the way for a new work culture. After studying the work cultures followed by successful companies world over, M&M evolved Mahindra Production System (MPS) which is an amalgamation of the latest work measurement techniques and the Toyota Production System.

As a result of adopting MPS, the Kandivali plant will now operate on JIT, multi-skilling operations by workmen, single piece flow process, observance of TACT time and flexibility. The MPS will result in improved quality, significantly higher productivity and reduced costs due to reductions in inventories, rejection rates and optimum utilisation of manpower, machines and floor space.

The earlier agreement expired on October 31, 1995. The new agreement, signed on December 19, 1997, will be effective November 1, 1997 and will remain in force till December 31, 2000. According to the new settlement, the company will additionally spend on each worker an average of Rs 3000 per month including all direct and indirect costs. The benefits will accrue to 5,085 employees of the automotive division in Mumbai.

Commenting on the settlement AE Durante, executive director and president of the automotive division said: "The settlement is truly of historic significance." Firstly, it has been reached without any confrontation or loss of production. Secondly, there was a total transparency in our dealings with the union, he added. "This transparency led to strengthening of mutual trust which helped both the management and union work as a team towards the common objectives. The agreement will make us stronger and confident to face competition in the marketplace," said Durante. With this agreement, daily production of vehicles at Kandivali is proposed to be increased from 68 to 150 in stages over six months.

Copyright © 1997 Indian Express Newspapers (Bombay) Ltd.