Dear all,
What is the hidden cost of poor industrial relations? I am suggesting some costs; please add based on your experience and exposure.
1 - Lost management time and productivity.
2 - Low employee engagement.
3 - Unhealthy work culture / stressful work environment.
4 - High litigation costs.
5 - Labour turnover costs.
6 - The cost of indiscipline.
7 - Delay in developmental process / low level of acceptance.
8 - Loss of confidentiality.
9 - Unwanted third-party involvements.
10 - Employer branding costs.
Thanks and regards,
From India, Delhi
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37What is the hidden cost of poor industrial relations? I am suggesting some costs; please add based on your experience and exposure.
1 - Lost management time and productivity.
2 - Low employee engagement.
3 - Unhealthy work culture / stressful work environment.
4 - High litigation costs.
5 - Labour turnover costs.
6 - The cost of indiscipline.
7 - Delay in developmental process / low level of acceptance.
8 - Loss of confidentiality.
9 - Unwanted third-party involvements.
10 - Employer branding costs.
Thanks and regards,
From India, Delhi
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Dear colleague,
The cost of poor industrial relations (IR) is both short-term and long-term. You have made a good attempt to list several qualitative and quantifiable areas. Sometimes, the cost is irreparable and puts the organization several years behind compared to competitors.
I can think of the loss of opportunity cost and loss of customers as major costs should it happen.
Organizations with poor IR won't survive, and unless damage control and preventive actions are systematically taken at the right time, they will see doomsday sooner or later.
Regards,
Vinayak Nagarkar
HR and Employee Relations Consultant
From India, Mumbai
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The cost of poor industrial relations (IR) is both short-term and long-term. You have made a good attempt to list several qualitative and quantifiable areas. Sometimes, the cost is irreparable and puts the organization several years behind compared to competitors.
I can think of the loss of opportunity cost and loss of customers as major costs should it happen.
Organizations with poor IR won't survive, and unless damage control and preventive actions are systematically taken at the right time, they will see doomsday sooner or later.
Regards,
Vinayak Nagarkar
HR and Employee Relations Consultant
From India, Mumbai
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Hello Sharmavk05,
In addition to the loss of opportunity cost and loss of customers that Vinayak Nagarkar mentioned, you can also add this: higher hiring costs indirectly linked with your point number (10).
Bad news has the habit of spreading faster than good news, so poor IR practices would be known sooner than later, and the company would end up spending more to hire the same number, quality, and level of new employees than another company with good IR practices.
Regards,
TS
From India, Hyderabad
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In addition to the loss of opportunity cost and loss of customers that Vinayak Nagarkar mentioned, you can also add this: higher hiring costs indirectly linked with your point number (10).
Bad news has the habit of spreading faster than good news, so poor IR practices would be known sooner than later, and the company would end up spending more to hire the same number, quality, and level of new employees than another company with good IR practices.
Regards,
TS
From India, Hyderabad
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Dear Friend,
The industrial relations in an industry solely involve the integration and cohesive relationship of employees and employers, management of decision making, and capital investment. The hidden cost of poor industrial relations arises from the mismanagement of the above, which may cause revenue loss and unrest in an industry.
1. Loss of time and productivity.
2. Loss of productive employees.
3. Loss of work culture.
4. High operation costs.
5. Increase in labor turnover costs.
6. Entanglement with law and order situations.
7. Delay in the delivery process.
8. Loss of clientele confidence.
9. Unwanted third-party involvements.
10. Loss of market and goodwill.
If proper checks are not made in time, it may cause a shutdown of business with a gross revenue loss to owners and stakeholders.
From India, Mumbai
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The industrial relations in an industry solely involve the integration and cohesive relationship of employees and employers, management of decision making, and capital investment. The hidden cost of poor industrial relations arises from the mismanagement of the above, which may cause revenue loss and unrest in an industry.
1. Loss of time and productivity.
2. Loss of productive employees.
3. Loss of work culture.
4. High operation costs.
5. Increase in labor turnover costs.
6. Entanglement with law and order situations.
7. Delay in the delivery process.
8. Loss of clientele confidence.
9. Unwanted third-party involvements.
10. Loss of market and goodwill.
If proper checks are not made in time, it may cause a shutdown of business with a gross revenue loss to owners and stakeholders.
From India, Mumbai
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The hidden cost of poor industrial relations may be summarized as below:
The workmen, at the behest of unions, develop a sense of militancy and start ruling the roost over a period of time. The discipline would be at a crossroad, productivity being lowered, and the management gets stuck as to how to straighten the situation. Any inevitable bulldozing to correct the situation by management would backfire, creating total chaos and impasse.
In sum, the management would pay a heavy price to set right the situation in terms of production/productivity, strained employee relations, overall animosity, dragging labor litigation, etc.
P. Senthilkumar
From India, Chennai
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The workmen, at the behest of unions, develop a sense of militancy and start ruling the roost over a period of time. The discipline would be at a crossroad, productivity being lowered, and the management gets stuck as to how to straighten the situation. Any inevitable bulldozing to correct the situation by management would backfire, creating total chaos and impasse.
In sum, the management would pay a heavy price to set right the situation in terms of production/productivity, strained employee relations, overall animosity, dragging labor litigation, etc.
P. Senthilkumar
From India, Chennai
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Poor industrial relations (IR) could ruin the organization. There are many instances where organizations have perished due to long drawn-out strikes and lockouts. A classical case is the textile industry in the Bombay region (as it was then), impacted by a formidable trade unionist, Mr. Datta Samant.
From India, Mumbai
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From India, Mumbai
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