Human Resource Policy of Garments Sector of Bangladesh
Purpose of the Report:
The main purpose of this report is to learn the practices of human resource policies in Garments sector (Large, Medium) in Bangladesh. We have also some specific objectives such as;
- Whether RMG is maintaining any written human resources policies
- Whether there is any discrimination in their function of HRM.
- Are they playing fair rule in the process of recruitment, selection, and performance appraisal.
Basically, in preparing this report we didn’t experience any significant type of limitations. Because, our honorable teacher Dr.Mr. Md. Abdul Hannan Mia, who provided us the necessary guidelines that helped us a lot to prepare this report. He also gave us sufficient time to finish the report. Side by side we got a great deal of support and information from the top management of various RMG companies especially from Managing Director Mr. Abdus Salam of Nightingale Fashion. No significant amount of cost was incurred in preparing this report.
But in preparing this report the only limitation that we have faced is our lack of experience in conducting such an extensive and formal study.
Procedures of Gathering Information:
In order to gather the required information for preparing the report we have made an extensive interview with the top management of various RMG companies. For this purpose we made an appointment with Directors of those companies. From this interview we have gathered the raw data regarding various functional, business and corporate level strategies. After collecting this raw information, we have interpreted these data and finally tried to find the HR policies and also their practices in RMG sector of Bangladesh.
Sources of Information:
The main source of information for preparing this report is the top management of Nightingale Fashion and other companies. We have also gathered some information from other sources.
General Plan for the Report:
In order to prepare this report, we have followed a sequential process.
Step 1: We have gathered necessary guidelines from our honorable teacher Dr. Mr. Md. Abdul Hannan Mia to develop the structure of the report.
Step 2: We have studied our textbook “Strategic Human Resource Management” by William p. Anthony. Pamelal. Perrewe. k. Michele Kacmar and “ Business Research” by Donald R. Cooper and Pamela S. Schindler in details.
Step 3: Based on this study we have prepared a detailed questionnaire on which we have made an extensive interview with the top management of Nightingale Fashion and others.
Step 5 After conduction the interview, we have interpreted various information and finally find out HR Policies and practices that are followed in various companies in RMG sector.
PART – 2:
1. Garments Industries of Bangladesh:
At present Garment is the main industry of Bangladesh now. This sector have developed here rapidly because of it is a labor intensive industry, ordinary technology, cheap labor and small capital. Before liberation in 1970, in Bangladesh there was only one garment factory. In 1977, the number rose to 8. In 1984, the number was 587. In 1998, the number stood at 2650 and now the number of garments in Bangladesh is 3300.
In Bangladesh garment factories are situated in Dhaka, Chitagong, Narayangong, Savar and Tongi-Gazipur (see Map of Bangladesh). The Number of Garment workers in Bangladesh is 1.6 million. Number of woman workers is 1.320.000 and men 280.000.
Seventy Six percent of total export of Bangladesh is garment oriented. Mainly Bangladeshi garments products are exported to the USA, Canada, and European Union and Caribbean countries. Recently Bangladesh started export to Japan, Australia and some other countries in small scale. Bangladesh exports 63 items of garments products. Main raw materials of garments — mainly fabrics come from other countries.
Here we are going to present our RMG sector’s contribution in Bangladesh Economy & Their Human Resources Practices with their Operation as a productive sector of the country.bution of RMG in Our Economy:
2. Contribution of RMG Sector:
RMG is the leading industrial sector in Bangladesh. With sales abroad estimated at 4.3 billion dollars a year, of which 44% exported to the United States alone, it represents 76% of Bangladesh’s exports. The sector employs approximately 1.5 million workers, mostly young women from underprivileged social classes. Many have left rural areas to come work in the textile factories of Dhaka and Chittagong, akin to the “American dream” of poor villagers. The clothing sector is the driving force of this poor country’s economy, with export figures that have risen spectacularly in the last decade as shown by the following table (data provided by BGMEA):
Exports of garments rose by 502% between 1990-1991 and 1999-2000 and by 14,000% if the current amounts are compared with those of 1983-1984. The world’s leading brands do their buying in Bangladesh: Levi Strauss, H&M, Marks & Spencer, Wal-Mart, The Gap, Nike, etc.
The Bangladesh Garment Manufacturers and Exporters Association (BGMEA) is the only recognized trade body that represents the export oriented garment manufacturers and exporters of the country. Ready-made Garment (RMG) emerged as a promising export earning sector of the country by the year 1983. Bangladesh at that time lacked a sect oral trade body, non-government in nature, free from traditional bureaucracy, to help the sector to boost up the country’s foreign exchange earnings. Entrepreneurs and the government in the post independence years felt and emphasized the urgent need to develop non-traditional items of export for helping the struggling economy. As a result, 1977 marked the birth of Bangladesh Garment Manufacturers and Exporters’ Association (BGMEA). Since its humble inception with only nineteen (19) garment manufacturers and exporters, BGMEA has grown into a strong and dynamic body. Today it proudly declares registered membership of more than 2700 garment manufacturers and exporters. Of the total 2700 units, about 1932 garment factories are located in Dhaka while about 1 55 and 415 factories are located in Naryanganj and Chittagong respectively. Factories are located in Dhaka while about 1 55 and 415 factories are located in Naryanganj and Chittagong respectively. These 2700 garment factories having about 1.5 million workforces is earning 73% of the country’s total foreign currency. About 1 5 million people are directly dependent on this sector.. The following are the regular activities of BGMEA for its members, owners, apparel buyers and other partners.
- Organizing members to hold or to participate in apparel fairs at home
- And abroad; (For further information, any interested party can use BGMEA’s web page at http://www.agn i.net/batexpo).
- Establishing and promoting contacts with foreign buyers, business associations, chambers etc.
- Providing the members, apparel buyers and other information users with various related data.
- Monitoring international apparel trade and trade. fairs and disseminating the relevant information through its Computer-Network-System linked with various online data sources in the USA and the EU.
- Encouraging co-operation between industries, companies, firms engaged in manufacturing of garments, allied industries and exporters of ready-made garments.
- Organizing seminars and symposia on current trade issues to develop awareness and consensus among the members and other related parties.
- Helping in Government’s textile quota negotiation with USA and Canada.
- Helping to resolve trade disputes between the members and the buyers.
- Maintaining computerized membership information and providing information on quota matters.
- Monitoring implementation of Mau on child labor elimination from the export oriented garment sector of Bangladesh.
- Educating the displaced workers below the age of 14 years and the children of the workers through setting up of school-cum-health centers in different zones of Dhaka, Narayangonj and Chittagong.
- Publishing a monthly magazine styled “BGMEA Newsletter” that provides updated information about the garment sector.
- Helping disposal of stock-lots of fabrics.
- Recommending for correct utilization of fabrics/yarn/acrylic/wool.
- Giving permission for Inter bond sub-contract of bonded warehouse goods.
- Issuing Utilization Declaration (U/D), Export Orders for clearance of raw materials imported by member-factories.
- Ensuring adoption of Safety Measures in order to avert fire accidents in factories.
- Contributing financial aid for the victims in case of casualty in fire accidents in member-factories.
- Having regular co-ordination with the labor organizations in the garments sector to resolve labor related issues and establish cordial employer-worker relationship.
- Creating awareness of the member-units on labor matters by giving expert advice as and when required.
- Giving legal assistance to member-units through our Legal Adviser as and when required.
- Co-sponsoring with GOB, ILO and UNDP for implementation of welfare measures for garment workers in broader areas of primary health care, transportation, social security & insurance coverage, housing and skill training.
4. National Garments Workers Federation:
National Garments Workers Federation is a countrywide registered Independent, Democratic and Progressive Trade Union Federation of garment workers in Bangladesh. The federation was established on 1984. There are 28 registered trade unions (plant unions) affiliated with the NGWF. Beside these, the federation has 1016 factory committees. From 1984, the federation is involved in all the important movements including several countrywide strikes in the garment sector. Total membership of the federation is: 20.000 paying member: 5.100 and Non paying: 14.900.
Central Office of the federation is at 27/11/1 Topkhana road, Dhaka-1000. There are 3 others branch offices of the federation in Chitagong, Savar and Tongi.
The federation is run by its written constitution and participations of its members in a democratic way.
A. Aims and Objectives
- Ensure fair wages.
- Establish the Workers Rights and Human Rights.
- Ensure the equal wages and equal rights for the women workers.
- Improve the working condition and environment in working places.
- Struggle for a democratic, developed and progressive society.
B. Main Activities
- Unite the garment workers.
- Formation of plant level unions.
- Initiate and Conduct the countrywide movements for the betterment of garment workers.
- Support, cooperate and conduct the factory base movements.
- Awareness building among the garment workers.
- Training and education for the garment workers.
- Special training and education for the woman workers.
- Legal aid for the members and garment workers.
- Publicize the workers and other materials for the garment workers in local and easy language.
- Cooperate to get new jobs for the unemployed and dismissed workers.
- Awareness building for health and environment and to provide health facilities.
- Organize meetings, processions, demonstrations, seminars and symposiums for the garment workers.
- Support and participate in the movements of other sectors, democratic movements and women freedom movements.
- Express and show solidarity with international trade union movements, democratic movements and women movements.
5. Industry-An Overview:
In the open market economy, the ready-made garment industry (RMG) is the prime industry in Bangladesh. RMG sector is the largest contribution to the National income and exports of Bangladesh. The RMG industry of Bangladesh supplies a good portion of the total needed supplies of ready made garments throughout the world.
The RMG sector in Bangladesh has largely grown, spurred by the quotas imposed by major importing countries under the Multi fiber Agreement (MFA).
The RMG industry is thrusting our economy towards development with a contribution of about 70% in the national income and by employing over 1.6 million workers of which over 1.5 million are female workers. The progress of RMG sector has opened up a wide road towards vast opportunities and development propositions.
RMG sector has brought a stream of development in the following areas along with its own.
ò Increase of Export trade.
ò Creation of employment opportunities.
ò Creation of new, enthusiastic, dynamic entrepreneurs.
ò Development of relevant Industry, such as weaving, spinning, knitting, dying, finishing and printing etc.
ò Development in transportation sector and roads & highways.
ò Greater utilization and revenue earning from the port(s).
ò Development packaging industry.
The development of RMG sector also brings up benefits to some other areas such as.
– Financial Sector
– Insurance companies
– Introduction of new technology
– Infrastructure development
– Reputation in the world market.
Garments sector industry we have certain advantage of export. Bangladesh is enjoying the most favored nation (MFA) or quota system from USA and generalized system of preferences (GSP) from European Union. USA imported 50 percent of our total garment export. They also imported 37 percent of total export of our country.
European union important 46 percent of our total export goods because the importers of European Union are enjoying 12 and half percent tax reduction But after the year of 2005 these above system will not exist. If we cannot establish the backward linkage industry within this time period. 1300 of our garment industry will close forever.
Thus the present world economy posses a great deal of challenges for the ready made garment industry of Bangladesh.
The ensuring describes the major challenges implications and the strategic responses under taken by the stakeholders, government and BGMEA.
6. Condition of Garments Workers in Bangladesh:
In reality the condition of garments workers in Bangladesh is very bad. There are some changes due to the labor unrest, trade union movements, and Social pressure and for the pressure of developed countries consumers. But till now Living standard of workers is unacceptable
There is no law for the national minimum wage. There are scopes to fix the minimum wage in sector based: In every 3 years, the minimum wage is supposed to be revised but it is not followed in the all sectors. In 1994, the minimum wage for the garment workers was fixed at Tk. 930/ per month (1) for the unskilled workers and Tk. 2300/ for skilled workers. This minimum wage was not revised till now. Even till now, the minimum wage of 1994 was not implemented in the whole sector. Till now, in many cases the unskilled workers receive Tk. 800/ per month. Most of the garment factories do not follow the labor law and ILO conventions. Most of the cases the workers cannot enjoy the weekly holiday. There is no Job security, social security, gratuity or provident fund for the garment workers. Most of the cases the management do not provide appointment letters/ contract letters, identity cards and service books. According to the Labor Law, the maximum working hour per day is 10 including the 2 hours overtime. But in most of the cases workers are forced to work 14 to 16 hours per day. Some times they work whole night. Overtime work is compulsory and forceful. There is not housing facilities from the owners. Most of the cases maternity leaves is absence. Most of the cases there is no transportation facilities. Most of the cases, there is no doctor, first aid, sufficient light and ventilation. In some cases there are no sufficient and pure drinking water and toilets for the workers. According to law, women work is prohibited after 8 pm. But the women workers are bound to work until 10 pm or 11 pm. Even in some cases they work the whole night. Most of the cases maternity leaves is absence. Most of the factories do not have the day care centers. Most of the cases, management do not pay the monthly wage and overtime payment within 7th of the next month. In many cases monthly wage and overtime payment is out standing for 2/3 months. Health-safety and security condition are not sufficient. Management do not allow the workers to join the trade union or formation of trade union though the workers have the trade union rights according to the labour law and ILO conventions. Management fires the workers if he/she joint in the trade union. Some times they threaded the workers and even close down the plant for the formation of trade union. Management does not ensure the security of the women workers. Women workers faced rape and sexual harassment out side the factories and some times inside the factories. There is other form of sex discrimination. Women workers are deprived from Equal wage, Equal dignity, Equal rights and Equal promotions.
6.1 Trade Union Movement in Garments Sector:
a. Labor relations The process of dealing with employees when they are represented by a union
b. Collective bargaining the process of agreeing on a satisfactory labor contract between management and a union
c. Grievance procedure The means by which a labor contract is enforced
d. Contingent and Temporary Workers
e. Trends in Contingent and Temporary Employment
In recent years, the number of contingent workers in the workforce has increased dramatically. Categories of contingent workers include Independent contractors, on-call workers, temporary employees (usually hired through outside agencies), and contract and leased employees. Another category is part-time workers.
Trade Union movement in garments sector is very weak. Even it is weaker than other sectors. There are 8 country wide registered trade union federations. There are 9 federations registered as division based. Another 5 registered federations are combined with Jute, Textile and leather Sector. Apart from these, there are 6 unregistered federations in this sector. There are 3 alliances in the garment sector. These are:
1. Bangladesh Garments Workers Unity Council.
2. Bangladesh Garments Workers and Employees Unity Council.
3. B.N.C.C. (Bangladesh Coordinating Committee, affiliated with (ITGLWF).
6.2 Reasons of the Weakness of Trade Union Movement in Bangladesh:
Main Reasons of the Weakness of trade union movement of garment sector in Bangladesh are:
1. Disunity and division of organizations.
2. Unlimited and long working hours.
3. Absence of Job security.
4. Migration from factory to factory.
5. Absence of weekly holiday and other holidays.
6. Majority of women.
7. State policy.
8. Elite class ownership.
9. Low wage.
10. Unemployment of the country.
7. Major Challenges Facing the RMG Sector and its Implications:
7.1 Integration of MFA into WTO-ATC
Bangladesh will face open competition with other developing countries. China is expected to gain most from the implementation of the ATC, followed by India and South Korea;
US Trade and Development Act (TDA 2000)
The TDA 2000 provides preferential trade (duty and Quota free) accesses, especially in textiles and apparel to the countries of Africa and Caribbean Basin.
7.2 The Global recession
The global economic environment puts a sustained impact on the Bangladesh economy and the economic of Bangladesh has been integrating into global economy.
7.3China’s WTO Entry
China’s clothing exports is 16.2 percent of the total world exports while Bangladesh’s textile shares only 2.1 percent. It is feared that, access of china into the WTO it would crowd out other developing country supplies.
There are factual indications that, when quotas are eliminated countries like Bangladesh may be neglected and production shifted to locations like China.
7.4 Observance of Rights of Workers
ò The “Cheap labor” ideology (have negative wage rates);
ò Long working hour and no leaves maintained;
ò No appointment contract;
ò Workers health and insecurity;
ò Lack of Non-wage benefits;
ò BGMEA’s response to statutory issues.
8. The Positive & Negative trend of globalization on RMG sector:
The RMG sector has the largest contribution to our national income. Since the independence of the country the RMG industry has been rising. Due to the effect of globalization, especially the quota and MFA agreement, this sector has achieved tremendous growth after the mid 80s. This growth trend has continued until the September-11 occurrence and the threat of phasing out of the MFA, GSP preference for the developing countries like Bangladesh is the near future (2004).
From the chart below we can see the number of firms that have been established since the mid 70s till date.
|Year of establishment||Number of Firms|
The Terrorist strike of September-11
This chart can be shown in a diagram below :
The trend line clearly shown that, since the mid 80s till the late 90s the impact of globalization on the RMG sector has been positive & benefiting to the national economy. But due to the recent global economic recession and events like September-11 the growth trend of RMG sector of Bangladesh along with other developing countries has substantially fell (from 3500 firms in the year 2000 to 2200 firms in year 2002).
So it can be said that in the present global economic condition the impact of globalization is not so good for the developing countries specially Bangladesh.
: – In Brief -:
The major threat of globalization process on the RMG sector of BD. and eventually on the firm (Chaity Group) is the open market strategy initiated by WTO. The RMG industry of BD. has to directly fight against the more developed and sophisticated industries throughout the world. The phasing our of the Quota system (Dec. 2004) due to the phasing out of MFA (GSP) for countries like BD. is the greatest challenged of all.
b. Strategic Response:
Price & quality these will be the two most effective weapons against this threats by globalization.
The govt. of Bangladesh along with BGMEA are engaged in continuous lobbying for the extension of the preference of quota with the international communities. Rounds of Negotiations are being undertaken. One of the latest strategy by BGMEA is the inclusion of large international buyers and the buying houses in the member list of BGMEA and putting the indirect pressure on them of being stake holders of this sector.
9. Code of Conduct:
The group operates in full compliance with the applicable laws, rules and regulations, including those relating to labor, worker health and safety, and the environment.
9.1 Child Labor:
They employ only workers who meet the applicable minimum legal age requirement or are at least 18 years of age, whichever greater.
9.2 Work Environment:
They encourage developing lawful workplace apprenticeship programs for the educational benefit of their workers.
They employ workers on the basis of their ability to do the job, not on the basis of their personal characteristics or beliefs.
9.4 Piece Goods Quality Control:
Approx., 10% -20% inspections of all piece goods prior to spreading. Four point system is followed to classify defects. Defect classification list has been set up to simplify the language and judgment used to make visual fabric evaluation. Rolls are segregated shade wise prior to spreading.
9.5 Cutting Department Quality Control:
Final patterns are checked thoroughly against measurements provided to control spec deviation. Ply numbering, stickers and bundling is followed to control shading within lots. Random sampling is done prior to cutting to determine shrinkage and any other characteristic that may exist in the fabric.
9.6 In-Process Quality Control:
In line audits are carried out by qualified inspectors to correct the problem at the sewing level rather than after the garment has been completely assembled. Written quality standards are set up to lay emphasis on critical operations. A separate Q.A. Team independent of production has been appointed to evaluate the quality of merchandise being sewn.
9.7 Random Final Statistical Audit:
After merchandise has been duly checked / inspected by the finishing section, a final audit is carried by their professional Q.C’S. Merchandise are audited at 4.0 AQL presently. They are seeking to attain 2.5 AQL in the near future. Their dedicated work force, skilled professionals and groomed management are committed to take the new challenge of up-to-date styling and fashion from global market.
9.8 Forced Labor:
They don’t use involuntary labor of any kind. They do not force any worker to remain in employment, for any period of time against his or her will.
9.9 Wages and Hours:
They set working hours, wage and overtime pay in compliance with all applicable laws.
9.10 Medical Facilities:
They provide free medical facilities & consultancy to workers.
9.11 Working Conditions:
They treat all their workers with respect and dignity and provide them with a safe and healthy environment. They comply with all applicable laws and regulations regarding working conditions.
9.12 Quality Assurance:
All the garments produced are subjected to strict quality assurance checks and inspections. They work hard to produce quality garments consistently. In order to sustain quality they work with respective buyers quality control manuals as required.
10. Case Study:
Nightingale Fashion Limited, one of the largest contributors of the RMG industry, has its own global challenges and strategies to respond to those challenges as it is a part of the industry. The ensuring discusses the challenges and strategic response to those challenges at the operative levels of the firm.
It is an export oriented composite Textile, Dyeing, and Finishing & Printing & Garments Industry for production of Knit Fabrics & fashionable and basic knit Garments.
The factory is located in the front of BSCIC Industrial Estate, Konabari Gaziputr. There is a 7-storied building of 50,000 Sq. Ft. for its Knitting, Dyeing, Finishing, printing and Garments units owned by the company. The factory is fully equipped with brand new highly sophisticated modem high-speed machineries. Our expert and trained professionals and technicians are working for its effective & efficient management and production.
The Company office is also situated at Dhaka Metropolitan area Malibagh Moor which continuous supervision & immediate decisions of the management could easily be given for information of production and correspondence.
Nightingale Fashion Ltd is a member of BGMEA (Bangladesh Garments Manufacturer and Exporters Association)
This unit is equipped with modern machinery’s to produce different types / designs of knit fabrics. The circular Knitting machines of different from 17” to 36” are of FALMAC brand fitted with 4 treck cams, are producing Single Jersey/ Pique / Laquest fabrics of weight 135 to 300 GSM(finished). Moreover also producing Lycra(S/J and Rib) Interlock Fabrics, Semi Jacquard Fabrics, Strip Fabrics, Melange Fabrics, Rib Fabrics, French Terry in different weights.
A group of experienced Knitting operators are working under an experienced Knitting Engineer having all the sophisticated test equipment. Checking of all gray fabrics is dined before dying.
The average monthly production capacity of fabrics is about 150 Tons
List of fabrics that can be produced:-
Type of fabrics
100% cotton /65% Polyester 35% cotton
95% cotton 5% lycra
100% cotton or P/C
The unit is equipped with modern machinery of brand Woo Yang, Kyung Hoon, Dongnam & Hanseong are done solid color dyeing as per duyer requirement. Also installed High Temperature Winch which done TC fabric dyeing. We keep the schedule that in time delivery for vendor.
This unit is equipped with modern machinery of Juki, Kansai Special, Pegasus, Siruba & K.M. The selection of machines is done such a way to cover most the stitching facilities for Knit Garments.
The finishing of garments is done by Full Steam Irons pressed on vacuum Ironing Tables. All the garments are passing through thread sucking machine.
1st Inspection are done during stitching in production floor, then after completion of and stitching and finally after ironing works before packing. We do 100% inspection before export.
The efficient workers, supervisors and floor in charge are working in this unit under an experienced Production Manager.
The sample making section: this section is headed by an experienced in charge capable to understand any kind of styles, sketches, different types of stitching and fabrics, Pattern making also done here. The machine operators of the section can operate all kinds of sewing machines. All collection samples for different seasons, fitting samples, photo samples are produced in this section.
Average production capacity of garments is about 40,000 to 45,000 Doz/month.(of basic item)
Presently producing following garments:
Moreover NIGHTINGALE FASHION LTD. has the following facilities for smooth operation:
o Own stand by Generator to run full factory(450 K V A)
o Own Power Substation (GEC)
o Fire fighting equipments including fire extinguishers, smoke detectors, separate stair case etc.
o Sufficient volume of water reservoir at under ground & overhead.
o Toilet complexes at each floor separately for male & female workers.
o Sufficient Tube Lights are provided in all the working areas.
o Sufficient Ventilation is provided by installing ceiling fans, exhaust fans& large windows .
o Factory premises is always kept nest & clean.
o Floors are fitted with ceramic tiles so that it remains very clean. During winter season worker can walk bare footed with any difficulties.
We do not have any child labor.
List of the Buyers, to whom NIGHTINGALE worked so far:
Name of Buyer
10.1 Structure of the Organization: Challenges & Strategies
The organization is headed by the Managing Director (MD) who is followed by the Executive Director (Finance) & Executive Director (Operations).
– The Human Resources of the organization is so allocated that ensures the Management of the firm is competent enough to endure the fierce competition both at the national and International level.
10.2 Strategies / Policies in this regard are
– Top Management is involved in frequent supervision of quality of product.
– Executives are engaged in motivating the employees to bring out the maximum productivity of the work force.
– Job description, specification, recruitment and lay off policy, salary and incentive are pre decided and well enunciated.
– The company does not usually deploy external expertise without some obvious exceptions.
– The employees at the root level are given training before being engaged into the production. Executives are trained, if needed, either on the premises or at the BGMEA training centre.
10.3 Procurement of Raw Materials
The company has a stubborn quality control policy. In the process of procurement of Raw Material the company uses the following sources:
– Backward Linkage Industry; it has its own Textile Mill, Knitting and Woven facility, printing and packaging factory.
– Importing; the firm sources it’s material from China, Singapore, India, Thailand and other respective countries according to the material requirement of the production process.
– As it is an order-supplying company, the material may also provided by the customer.
10.4 Production Process
The company has a formidable infrastructure and equipment to meet the quality level desired by the customer. The company posses almost all latest machinery and equipment needed by a firm to complete globally.
[A Machinery list can be found on the company profile]
– Firm uses some special advantages by using machines like CAD. Marker Paper etc. which are available only in few other Bangladeshi firms.
– Backward linkage industry is also used for production.
– Sub contracting is a common scenario within the Industry these days.
10.5 Product & Quality
Firm follows a stringent quality control policy. It is using 1509002 as a quality measurement standard. Over the past 20 years the quality control view has changed. Now-a-days the QC officers are concerned with the ‘jump-stitch’ or ‘joint stitch’ problem rather than will the ‘open sum’ problem.
– Clients these days are not that much concerned with the stitch and oil mark problems. It is obvious that a firm has overcome these primary level problems by using more modern technologies that has been possible for the globalization process.
– The quality control process involves creating commitment in the employees providing them with proper environment, exercising human rights and social responsibility of the firm.
These trends managing the work force is an obvious outcome of the globalization process.
Just 20 years ago, the RMG sector of BD was like a sellers market where buyers came and chose. But now due to quota the marketing structure changed.
– Now a quota of RMG product that can be exported to US market is given by the U.S. government.
– The Export Processing Bureau [EPB] thus allocates the total quota among the firms of the industry.
– In this respect it can be said that due to globalization the production and selling capacity of a firm is controlled by the International bodies and government of the country.
10.7 Technical Aspects
The company personnel mentioned that they have a well trained work force and the required technical aspects including machinery that can met the customer satisfaction. Though Bangladesh firm are assigned with the order of [C-grade] ready made Garment products, they argued that with their present level of technical expertise, the firm can deliver ever higher grade product order. They added only government policy and the assistance of International bodies is needed to deliver a quality output.
10.8 Inter industry conflict & settlement
The export oriented readymade garment industry of Bangladesh is dependent on the quotas allotted by the US government. The firms within the industry thus are usually among themselves trying to fulfill the delivery assigned to them by the quota. These firms usually do not engage in a battle to capture market. They try of fulfill their assignment is that they can get that quota the next year. Still there is a battle going on to get the excess quota that is at the will of Export Processing Bureau (EPB) for allotment.
Thus very high level lobbing may be exerted by these firms. If there are any conflicts among these firms, that lies only in terms of quality and price if their product. Conflict resolutions may take the form of negotiation either face to face or by the intermediary of BGMEA.
10.10 Government Policies and their effects
Government policy directly affects all the industry within the country. RMG industry, in this case, is not an exception. Policy undertaken by the Govt. such as:
– Slashing of cash subsidy to the garment & textile industry.
– Putting bars to import threads, textile items and other related apparels.
– Stoppage of the tax holiday previously enjoyed by this sector.
– No recent reforms in Govt. policy regarding the latest change in the global market place.
– Reluctance of Govt. to set up backward and forward linkage industry to support this sector.
– Inability of the Govt. to set up modern telecommunication technology and no positive step to improve the existing infrastructure.
– Bureaucratic system and political lobbing and political instability about which govt. is quite slow to respond.
– Restructuring and bringing dynamism in the banking and financial sector.
And these areas along with many other Govt. policies which do not seem to cooperate with the RMG industry, which eventually putting our industry in a less competitive position in the world market.
10.11 The fall of World trade center and its after effects
The destruction of the world trade center is not only the destruction of the center itself but also the greatest catastrophe of the global business world.
Due to the September, 11 occurrence the world economy experienced great recession.
The RMG sector world wide has not been spared. As for the RMG industry of Bangladesh it accounted for great loss of the economy. As a result there is now-
– No or less order for garment product
– Refusal / rejection of accepting previous order.
– Stop of payment for the orders already delivered.
– Cancellation of large orders by the US and the EU.
– Closing of about 1300 firm out of 35000 firms.
– Result of the closing is high employment and low govt. revenue.
10.12 Policy Recommended by the firm
The RMG industry of the developing countries is at stake, for the omission of the Multi fiber Agreement (MFA) by the year 2004. The RMG industry of Bangladesh is aware of this threat. Our corresponding form has put forward some policies to face the challenges of open market.
– The quality aspect; in the open market economy (2005) the firm will have to face fierce competition from around the world. So the firm has taken the policy of maintaining and even bettering their product quality to complete the world.
– Price factor; price is another important shield for the firm to fight the new challenge. The firm wishes to provide highest quality product with lowest possible price.
– Market expansion; without the quota facility on, the firm has to look for new customers and new markets. A good relationship has to be built with present has to be built with present clients and potential clients. The area of export should be spread outside the USA, EU and Canada, Australia and Japan would be a good market.
– Capacity factor; in the global open market economy the firm may require to supply huge quantity of products. So, firm personnel depict his desire to enhance the production capacity of the firm.
– Time & productivity; time will be an important issue in the future. Time delivering of consignment is a must for a firm.
– Product differentiation; the firm has to differentiate its products and be more innovative if it has to complete with other firms within the nation and outside the nation. This is very important for luring customers who prefer dynamism.
– Cost reduction; to fight the global challenges the firm must achieve high productivity and cost reduction aspect is one of the important factor of productivity.
Gaining the desired productivity out of the work force is another important criterion of the firm to be able to complete in the open market.
11. Our personal view on RMG – Sector:
From the analysis of these companies, we can say that some of the companies in RMG sector are used to follow their own rules and regulation which are not fully alike with the standard rules and regulations provided by the authorities of BGMEA and other associations. And most of the companies in RMG-sector are totally unaware about the HRM policies and its practices. They are used to control their workers and employees of their own guided policies.
[Source: Information by interviewing the company personnel]
12. Guidelines for Developing a Human Resource Management Strategy:
Faced with rapid change organizations need to develop a more focused and coherent approach to managing people. In just the same way a business requires a marketing or information technology strategy it also requires a human resource or people strategy.
In developing such a strategy two critical questions must be addressed.
- What kinds of people do you need to manage and run your business to meet your strategic business objectives?
- What people programs and initiatives must be designed and implemented to attract, develop and retain staff to compete effectively?
In order to answer these questions four key dimensions of an organization must be addressed. These are:
- Culture: the beliefs, values, norms and management style of the organization
- Organization: the structure, job roles and reporting lines of the organization
- People: the skill levels, staff potential and management capability
- Human resources systems: the people focused mechanisms which deliver the strategy – employee selection, communications, training, rewards, career development, etc.
Frequently in managing the people element of their business senior managers will only focus on one or two dimensions and neglect to deal with the others. Typically, companies reorganize their structures to free managers from bureaucracy and drive for more entrepreneurial flair but then fail to adjust their training or reward systems.
When the desired entrepreneurial behavior does not emerge managers frequently look confused at the apparent failure of the changes to deliver results. The fact is that seldom can you focus on only one area. What is required is a strategic perspective aimed at identifying the relationship between all four dimensions.
If you require an organization which really values quality and service you not only have to retrain staff, you must also review the organization, reward, and appraisal and communications systems.
The pay and reward system is a classic problem in this area. Frequently organizations have payment systems which are designed around the volume of output produced. If you then seek to develop a company which emphasizes the product’s quality you must change the pay systems. Otherwise you have a contradiction between what the chief executive is saying about quality and what your payment system is encouraging staff to do.
12.1Employee education, training and development:
In general, education is ‘mind preparation’ and is carried out remote from the actual work area, training is the systematic development of the attitude, knowledge, skill pattern required by a person to perform a given task or job adequately and development is ‘the growth of the individual in terms of ability, understanding and awareness’.
Within an organization all three are necessary in order to:
- Develop workers to undertake higher-grade tasks;
- Provide the conventional training of new and young workers (e.g. as apprentices, clerks, etc.);
- Raise efficiency and standards of performance;
- Meet legislative requirements (e.g. health and safety);
- Inform people (induction training, pre-retirement courses, etc.);
From time to time meet special needs arising from technical, legislative, and knowledge need changes. Meeting these needs is achieved via the ‘training loop’. (Schematic available in PDF version. )
The diagnosis of other than conventional needs is complex and often depends upon the intuition or personal experience of managers and needs revealed by deficiencies. Sources of inspiration include:
- Common sense – it is often obvious that new machines, work systems, task requirements and changes in job content will require workers to be prepared;
- Shortcomings revealed by statistics of output per head, performance indices, unit costs, etc. and behavioral failures revealed by absentee figures, lateness, sickness etc. records;
- Recommendations of government and industry training organizations;
- Inspiration and innovations of individual managers and supervisors;
- Forecasts and predictions about staffing needs;
- Inspirations prompted by the technical press, training journals, reports of the experience of others;
- The suggestions made by specialist (e.g. education and training officers, safety engineers, work-study staff and management services personnel).
Designing training is far more than devising courses; it can include activities such as:
- Learning from observation of trained workers;
- Receiving coaching from seniors;
- Discovery as the result of working party, project team membership or attendance at meetings;
- Job swaps within and without the organization;
- Undertaking planned reading, or follow from the use of self teaching texts and video tapes;
- Learning via involvement in research, report writing and visiting other works or organizations.
So far as group training is concerned in addition to formal courses there are:
- Lectures and talks by senior or specialist managers;
- Discussion group (conference and meeting) activities;
- Briefing by senior staffs;
- Role-playing exercises and simulation of actual conditions;
- Video and computer teaching activities;
- Case studies (and discussion) tests, quizzes, panel ‘games’, group forums, observation exercises and inspection and reporting techniques.
Evaluation of the effectiveness of training is done to ensure that it is cost effective, to identify needs to modify or extend what is being provided, to reveal new needs and redefine priorities and most of all to ensure that the objectives of the training are being met.
The latter may not be easy to ascertain where results cannot be measured mathematically. In the case of attitude and behavioral changes sought, leadership abilities, drive and ambition fostered, etc., achievement is a matter of the judgment of senior staffs. Exact validation might be impossible but unless on the whole the judgments are favorable the cooperation of managers in identifying needs, releasing personnel and assisting in training ventures will cease.
In making their judgments senior managers will question whether the efforts expended have produced:
- More effective, efficient, flexible employees;
- Faster results in making newcomers knowledgeable and effective than would follow from experience;
- More effective or efficient use of machinery, equipment and work procedures;
- Fewer requirements to implement redundancy (by retraining);
- Fewer accidents both personal and to property;
- Improvements in the qualifications of staff and their ability to take on tougher roles;
Better employee loyalty to the organization with more willingness to innovate and accept change.
Corporate Cultural Awareness Training and Assignment Performance:
12.2 Manpower planning:
The penalties for not being correctly staffed are costly. Understaffing loses the business economies of scale and specialization, orders, customers and profits. Overstaffing is wasteful and expensive, if sustained, and it is costly to eliminate because of modern legislation in respect of redundancy payments, consultation, minimum periods of notice, etc.
Very importantly, overstaffing reduces the competitive efficiency of the business. Staffing level planning requires that an assessment of present and future needs of the organization be compared with present resources and future predicted resources. Appropriate steps then be planned to bring demand and supply into balance.
Thus the first step is to take a ‘satellite picture’ of the existing workforce profile (numbers, skills, ages, flexibility, sex, experience, forecast capabilities, character, potential, etc. of existing employees) and then to adjust this for 1, 3 and 10 years ahead by amendments for normal turnover, planned staff movements, retirements, etc, in line with the business plan for the corresponding time frames.
The result should be a series of crude supply situations as would be the outcome of present planning if left unmodified. (This, clearly, requires a great deal of information accretion, classification and statistical analysis as a subsidiary aspect of personnel management.)
What future demands will be is only influenced in part by the forecast of the personnel manager, whose main task may well be to scrutinize and modify the crude predictions of other managers. Future staffing needs will derive from:
- Sales and production forecasts
- The effects of technological change on task needs
- Variations in the efficiency, productivity, flexibility of labor as a result of training, work study, organizational change, new motivations, etc.
- Changes in employment practices (e.g. use of subcontractors or agency staffs, hiving-off tasks, buying in, substitution, etc.)
- Variations, which respond to new legislation, e.g. payroll taxes or their abolition, new health and safety requirements
- Changes in Government policies (investment incentives, regional or trade grants, etc.)
What should emerge from this ‘blue sky gazing’ is a ‘thought out’ and logical staffing demand schedule for varying dates in the future which can then be compared with the crude supply schedules. The comparisons will then indicate what steps must be taken to achieve a balance.
That, in turn, will involve the further planning of such recruitment, training, retraining, labor reductions (early retirement/redundancy) or changes in workforce utilization as will bring supply and demand into equilibrium, not just as a one–off but as a continuing workforce planning exercise the inputs to which will need constant varying to reflect ‘actual’ as against predicted experience on the supply side and changes in production actually achieved as against forecast on the demand side.
12.3 Employee motivation:
To retain good staff and to encourage them to give of their best while at work requires attention to the financial and psychological and even physiological rewards offered by the organization as a continuous exercise.
Basic financial rewards and conditions of service (e.g. working hours per week) are determined externally (by national bargaining or government minimum wage legislation) in many occupations but as much as 50 per cent of the gross pay of manual workers is often the result of local negotiations and details (e.g. which particular hours shall be worked) of conditions of service are often more important than the basics. Hence there is scope for financial and other motivations to be used at local levels.
As staffing needs will vary with the productivity of the workforce (and the industrial peace achieved) so good personnel policies are desirable. The latter can depend upon other factors (like environment, welfare, employee benefits, etc.) but unless the wage packet is accepted as ‘fair and just’ there will be no motivation.
Hence while the technicalities of payment and other systems may be the concern of others, the outcome of them is a matter of great concern to human resource management.
Increasingly the influence of behavioral science discoveries is becoming important not merely because of the widely-acknowledged limitations of money as a motivator, but because of the changing mix and nature of tasks (e.g. more service and professional jobs and far fewer unskilled and repetitive production jobs).
The former demand better-educated, mobile and multi-skilled employees much more likely to be influenced by things like job satisfaction, involvement, participation, etc. than the economically dependent employees of yesteryear.
Hence human resource management must act as a source of information about and a source of inspiration for the application of the findings of behavioral science. It may be a matter of drawing the attention of senior managers to what is being achieved elsewhere and the gradual education of middle managers to new points of view on job design, work organization and worker autonomy.
12.4 Performance appraisal:
An organization needs constantly to take stock of its workforce and to assess its performance in existing jobs for three reasons:
- 1. To improve organizational performance via improving the performance of individual contributors (should be an automatic process in the case of good managers, but (about annually) two key questions should be posed:2. To identify potential, i.e. to recognize existing talent and to use that to fill vacancies higher in the organization or to transfer individuals into jobs where better use can be made of their abilities or developing skills.
- What has been done to improve the performance of a person last year?
- And what can be done to improve his or her performance in the year to come?).
- 3. To provide an equitable method of linking payment to performance where there are no numerical criteria (often this salary performance review takes place about three months later and is kept quite separate from 1. and 2. but is based on the same assessment).
On-the-spot managers and supervisors, not personnel management staffs, carry out appraisals. The personnel role is usually that of:
- 1. Advising top management of the principles and objectives of an appraisal system and designing it for particular organizations and environments.
- 2. Developing systems appropriately in consultation with managers, supervisors and staff representatives. Securing the involvement and cooperation of appraisers and those to be appraised.
- 3. Assistance in the setting of objective standards of assessment, for example:4. Publicizing the purposes of the exercise and explaining to staff how the system will be used.
- Defining targets for achievement;
- Explaining how to quantify and agree objectives;
- Introducing self-assessment;
- Eliminating complexity and duplication.
- 5. Organizing and establishing the necessary training of managers and supervisors who will carry out the actual appraisals. Not only training in principles and procedures but also in the human relations skills necessary. (Lack of confidence in their own ability to handle situations of poor performance is the main weakness of assessors.)
- 6. Monitoring the scheme – ensuring it does not fall into disuse, following up on training/job exchange etc. recommendations, reminding managers of their responsibilities.
Full-scale periodic reviews should be a standard feature of schemes since resistance to appraisal schemes is common and the temptation to water down or render schemes ineffectual is ever present (managers resent the time taken if nothing else).
Basically an appraisal scheme is a formalization of what is done in a more casual manner anyway (e.g. if there is a vacancy, discussion about internal moves and internal attempts to put square pegs into ‘squarer holes’ are both the results of casual appraisal). Most managers approve merit payment and that too calls for appraisal. Made a standard routine task, it aids the development of talent, warns the inefficient or uncaring and can be an effective form of motivation.
13. Problems of Garments Sectors:
13.1 Lack of training and development:
Lack of sufficient training and development programs in RMG sector.
13.2 Lack of HRM policies and practices:
Companies are unwilling to follow the proper HRM policies and programs to develop their workers and employees
13.3 Lower Compensation Package:
Our Garments Sector are getting very cheap rate labor & they are very much ignored about facilitate them with sound salary & benefit packages.
13.4 Lack of Motivation:
Our RMG employees are reluctant of getting adequate motivation from their employers for improving themselves
13.5 Work under pressure:
Workers have to meet demands whenever they have to produce for export shipping as their top management’s orders to do in a limited time.
13.6 Expensive Orientation Programs Needed:
This is not as much of a problem for large international business enterprises as it is for small and medium size companies that compete in the global arena. Smaller companies often do not have the financial means to establish such programs. Smaller companies can send their expatriate candidates to a private training institution, but this is also costly. Yet, without such training, small firm’s expatriates are likely to make costly blunders in conducting business can sometimes overcome this difficulty by entering into a partnership with a capable firm in the foreign market.
13.7 Communication Problems:
The worker may encounter communication problems in the hierarchy. This lack also impairs performance.
13.8 Very Expensive Incentives Required:
To get these highly qualified people to accept a assignment, very expensive incentives, such as much higher salaries and benefits, are often required.
Sometimes technical workers as well Companies also face problems to hire them if they situated at different location, in that case they most of cases don’t provide transport facilities or paying an extra amount for convenience.
- Provide sound Compensation Package
- Provide appropriate Motivation
- Making Work environment more friendly to work happily under pressure
- Orientation Programs needed by immediate superiors not with much broader side.
- Communication should be always with immediate superior who will recommend his/her superior. That means maintaining hierarchy.
- Provide transport facility for technical employees or provide housing facility.
- Making people understand that they are part of the production process, so they are very important to Organization & Economy of Country for taking from them the best performance.
From above discussion we can see that today multinational company’s competitor increase and to achieve competitive advantage they need to expand their business and then they use malleable cheap rate employees. Though it’s a larger contributing sector of our economy, we find it very lower tolerances for their employees, so these things should be taken care of for the betterment of our RMG Industries productive development as well as their people’s improvement of livelihood & increase efficiency & effectiveness.
On the other hand, each and every company in garments sector should have proper and well planned SHRM policies and their practices in their every functional level of operation. Then we can ensure to get a more developed & economically strong country of us.
Part – 3:
Questionnaire: (Available upon request).
Bibliography / Reference:
Class lecture – Dr. Md. Abdul Hannan Mia, FCMA.
Scientific method and Social Research – B.N.Ghosh.
Business Research Method. By Donald R. Cooper, and Pamela S.Schindler.
Business Research Method by W.Zinkmund.
Article of Dr.Mahbubur Rahaman. RMG Sector and Its Future. 2000.
Human Resource Management. (A Strategic Approach) By William P. Anthony, Pamela L. Perrewe and K. Michele Kacmar.
List of Garments Companies from which we collect data.(Available upon request)