More Hours Same Pay...

This sure is an interesting Management strategy - The way Volkswagen have come up to a deal with their manufacturing unions.

So, the deal says that the employees will work for 4 more hours per week increasing from 29 to 33 and will be getting the same pay. This is something that is unimaginable for me from an Union's perspective. Where can you expect the union to sign a deal for the workers to work for more with the same pay? Well, on the other hand the union have made sure that the company will give job security for their employees till 2011.

When most of the car companies are trying to get out of the industry from negative slope, this strategy will atleast help VW to some extent of increasing their profit from their hot-selling Golf brand. What more can you expect? Usually the strategies for reducing the production costs are to make sure the company implement those manufacturing based industry-wide jargons like Kaizen, Lean, Pull, JIT etc. Or atleast increase production with some overtime hours from employees making a trade-off between the extra pay & the profit to be made.

But, with no extra cost for the "documented" excess working hours and at the same time increasing the prodcutivity & production is worth a success for the company.

BTW, whatsup with Ford & GM? Any improvements...?