Indian Institute of Management
Ahmedabad IIMA/OB0224
Prepared by Professor Kirti Sharda, Indian Institute of Management Ahmedabad. The author thanks
Ms. Vandana Laddha, Mr. Hemant Laddha and their staff at Shivani Carriers Pvt. Ltd. for their
contributions and support in developing this case. The author also acknowledges the support
received from Mahindra Trucks and Buses Division in developing this case.
Cases of Indian Institute of Management Ahmedabad are developed solely as a basis for class
discussion. They are not designed to present illustrations of either correct or incorrect handling of
management problems.
© 2016 by the Indian Institute of Management, Ahmedabad.  
Shivani Carriers Pvt. Ltd.: Managing
Employee Motivation at the Bottom of the Pyramid
Vandana Laddha, Director - Driver Management and Fleet Operations at Shivani Carriers
Pvt. Ltd., cleared her desk for the day and took a deep sigh. It was another day filled with a
littany of complaints from her drivers, mostly centred around their compensation. For the
last few weeks, she had been nagged with worries about the effectiveness of the driver
management system, which had been implemented under her leadership over the last one
year. She knew that discontent was brewing among drivers, especially, the modification of
the special incentive scheme, which was designed to boost productivity, seemed to be the
sore point. She had been thinking about what could be done to keep the truck drivers
motivated. Vandana Laddha (hereafter referred to as Vandana) felt it was time to discuss
some of her ideas with Hemant Laddha, the managing director of the firm. Hemant was in a
meeting with a client in his adjoining office. As she waited for him, her thoughts drifted to
the challenging evolution that the company had gone through in the past few years.
SHIVANI CARRIERS PVT. LTD.
Shivani Carriers was set up in 1974 by Shrawan Kumar Laddha as a small parcel booking
company under the name of Super Motor Transport Company. His sons, Tribhuwan Laddha
and Hemant Laddha joined the firm in 1985 and 1992 respectively. After Hemant joined the
firm, they decided to expand the firm’s operations beyond parcel booking to include
company contracts. The company was renamed Shivani Carriers Private Limited in 1995.
With time, the business grew and the company got involved in Full Truck Load (FTL)
services. In 2004, the firm moved away from dependence on market vehicles and started
acquiring its own fleet. As the fleet grew, in 2007, Vandana joined the business to assist with
fleet management issues. The organization chart is presented in Exhibit 1.
In 2012-13, the firm segregated its business - Shivani Logistics headed by Tribhuwan
Laddha, chose to offer Partial Truck Load (PTL) services. Shivani Carriers Pvt. Ltd. (SCPL)1
was focused on Full Truck Load (FTL)2 services and under the leadership of Hemant Laddha                                                        
1 The terms “Shivani Carriers” and “SCPL” have been used interchangeably to refer to Shivani Carriers Pvt. Ltd.
in the text.
2 Full truckload (FTL) carriers generally specialize in carrying a particular kind of item. The freight is not
handled enroute. FTL drivers deliver a semi trailer to a shipper who fills the trailer with freight for one
destination. The driver then completes the formal paperwork and travels directly to the consignee with the
shipment. FTL transit times are constrained by the availability of the driver and hours of service regulations. A
Less-than truckload (LTL) company generally mixes freight from other customers in each trailer. The shipment
2 of 16 IIMA/OB224 
(hereafter referred to as Hemant) created a transportation network across the Indian states of
Madhya Pradesh and Gujarat.
The company had grown at an annual rate of 23% since 2009. Growth stagnated between
2011 and 2013 but recovered in 2014. The annual turnover from 2009-2015 is presented in
Exhibit 2. Post the industry-wide downturn of 2012-14, the firm was focused on growth and
expansion by increasing fleet size, new client addition and by getting more work orders
from existing clients. In 2015, the fleet size was 91 vehicles. The company employed 46
employees and had 95 truck drivers on its rolls. The company’s client list included top
MNCs and Businesses in India, namely, ITC Limited, Tata Chemicals Limited, Nirma
Limited, Reliance Industries Limited, Hindustan Coca-Cola Beverages Pvt. Ltd., Pepsico
India Holding Pvt. Ltd., and others.
NEED FOR DRIVER MANAGEMENT AT SHIVANI CARRIERS
The year 2013 was a turning point in fleet management for Shivani Carriers. Vandana won
the Mahindra Lady Transporter of the Year Award in 2012 and in 2013 was selected for the
Mahindra Mpower Programme at IIM Ahmedabad, one of the foremost Management
Schools in India. She recalled:
The Programme changed my vision. Earlier I used to work on need-based issues like
managing fleet-related transactions such as drivers’ expenses, advances, salaries,
billing of freight, etc. I used to think that my husband needed a helping hand and so I
helped out. I wanted to do something but thought I couldn’t do it. After MPower, I
started taking interest in some neglected parts of our business as nobody was there to
take care of those little issues. Earlier I used to notice that our staff was not working
with their full efficiency and there was lack of coordination between them. But I never
interfered in their work. One reason was that I was working part-time initially and
did not have much time to address the issues. But the insights I got from the
programme regarding organizational behavior and human resources management
helped me a lot. I used to like my work but it was not a passion. It became my passion
after my visit to the MPower Programme at IIM Ahmedabad. I acquired this vision
from there that something should be done for the drivers.
The discussions on driver issues with her fellow participants and the faculty at IIM
Ahmedabad had been pivotal for her. She shared that her vision became clearer as she
became aware of the importance of driver retention and its impact on firm performance.
Six months after Vandana attended the MPower Programme, the need to do something with
regard to driver management became critical. The road transport industry was struggling in
20133 as the Indian economy battled to recover from its slowest pace of growth in a decade—
5% in March 2013, which further fell to 4.4% in August 2013. Sluggish industrial output
meant fewer goods to haul and stagnant or reduced freight rates.4 Fuel accounted for 55% of                                                                                                                                                                                        
is typically transported on several different trailers. Shipments are also broken down into individual containers
and further shipped by LTL or express carriers. Packaging for LTL often needs to withstand the more severe
handling of individual shipments. Retrieved from http://en.wikipedia.org/wiki/Truckload_shipping on June
3, 2015.
3 Retrieved from http://businesstoday.intoday.in/story/stimulus-for-recession-hit-commercial-vehicles-sector-
no-help/1/202678.html on May 8, 2015.
4 A truck operator’s profitability is a function of freight rates and operating costs. Truck freight rates are
governed by demand for transport, number of freight trips and capacity utilization. Retrieved from
3 of 16 IIMA/OB224 
a transporter’s operating costs.5 A 24% increase in the price of diesel in 2012-13 had severely
hurt the margins of truck operators, especially small fleet owners. Tyre prices and toll
charges were increasing as well. Because of shrinking business, high operating costs and
increasing borrowing costs, transporters found it difficult to service loans taken to buy
vehicles.6
Capacity utilization was low not only due to shrinking freight volumes, but also shortage of
drivers.7 Driver retention was a critical problem at Shivani Carriers too. Retention was
important as steady drivers expressed a sense of ownership towards their vehicles and
maintained their vehicles better. Frequent churn of drivers led to increase in maintainence
costs of vehicles. Maintainence costs were influenced by tyre consumption and mechanical
maintainence. Regular maintainence of the vehicles and better quality of tyres enhanced fuel
efficiency. A driver’s driving habits also played an important role in the tyre cost incurred
per km. Hemant explained:

When a driver does not have good time management skills, he is not able to adhere to
the time schedules. As a result, he has a tendency to drive rashly, which affects the
condition of the vehicle as well. When a driver drives fast, fuel average gets affected,
chances of accidents increase, and wear and tear of vehicle increases. Good driving
habits and regular maintainence of vehiclescan increase vehicle efficiency by 20-25%.
After extensive analysis, Hemant, Vandana and their management team discovered that the
trucks were being underutilized. For instance, they found out that a typical 12 wheeler
vehicle was running at 5500-6000 km per month, but had the capacity to go upto 8000 km
per month. Hemant believed that one of the major reasons underlying capacity
underutilization was that management was not in direct contact with the drivers. A driver
used to drive the truck as per his own understanding. Vandana explained:
The driver used to come to the premises, we would load the cargo and send him off.
He would reach his destination and unload the cargo. We realized if we planned
everything, then we could do better than this. On the other hand, if we did not utilize
our resources properly, we would not be able to progress. We needed to recover our
losses.
Hemant suggested that the management should meet the drivers personally and motivate
each driver to drive more. Vandana proposed to take the lead on this initiative under her
husband’s guidance.
DRIVER MANAGEMENT SYSTEM
Hemant and Vandana created a driver management strategy based on discussions with the
management staff. The company owned 12 wheelers, 14 wheelers and 18 wheelers. Along
with the traffic and workshop manager, they checked the condition of each vehicle, the                             
http://www.livemint.com/Industry/TaZKUlOR1zUEzbM5MfpOhI/Truck-operators-in-India-bear-the-brunt-
of-slowing-economy.html on May 8, 2015
5 Operational Efficiency of National Highways fppr Freight Transportation in India (2009). A Joint Study Report
by Transport Corporation of India Ltd. and IIM Calcutta.
6 More than 90% of the trucks and buses in India are bought on credit. Retrieved from
http://www.livemint.com/Industry/TaZKUlOR1zUEzbM5MfpOhI/Truck-operators-in-India-bear-the-brunt-
of-slowing-economy.html on May 8, 2015.
7 Retrieved from http://www.livemint.com/Industry/TaZKUlOR1zUEzbM5MfpOhI/Truck-operators-in-
India-bear-the-brunt-of-slowing-economy.html on May 8, 2015.
4 of 16 IIMA/OB224 
newness or oldness of the vehicle and examined the difference in the average running time
of each vehicle based on the model of the truck. They discovered that on the same route,
some vehicles were running around 7000 kms in a month whereas some were running just
5000-5500 kms in a month.
Vandana introduced an incentive program under which a driver had to drive a minimum
distance in terms of number of kilometres (kms) in a month. The minimum distances were
fixed according to different vehicle models. As per the scheme, the drivers would get an
incentive for every km driven after completion of targeted kms. Drivers were expected to
drive a mininum of 7000 km per month. If they exceeded their target beyond 7000 km they
would get INR 1 per km and INR 2 per km if they exceeded 8000 km.
Vandana prepared monthly km run projections for each vehicle with inputs from the traffic
manager. Other factors like waiting time at loading/unloading points were also kept in
mind while setting targets for the month. Vandana explained:
The idea behind this scheme was to utilize our resources to the fullest. If a vehicle
runs more in a month, the fixed cost will be the same and only variable cost will
increase. So by running more kms we can cut down cost per km.
The next step was to meet the drivers. Vandana put in place a process for this. Every
morning she would look at the driver list for the day and check if listed drivers were present
on the company premises. She would then check their performance for the past 6 months -
how many kilometers had the driver clocked and what was his average running time. Next,
she would meet the drivers and ask them to clock more than 7000 km per month. Initially
the drivers resisted. She would point out to them that all that the company was asking for
was 233 km per day and it was an achievable target. She shared with them that when they
were not loading/unloading, they were in fact driving 500-550 km per day.
The drivers wanted salary increment in return, but this was difficult. As the firm was
operating on a very thin margin, salary increment would be a huge burden on the company.
Vandana proposed that if the drivers would drive 1000-1500 km more every month, they
would be paid extra. The drivers still did not agree, they wanted an increase of INR 2000 per
month to begin with. At this stage, Vandana highlighted the difference between a good
driver and a not-so-good driver. She pointed out that people who were working harder
should get more. Vandana asked them to try out the proposal for one month and see what
they were earning in addition to their basic salary.8 Vandana assured them that she would
listen to their experiences and problems and then the company would decide if this initiative
would be continued or not. Finally, the drivers relented and agreed to participate in the new
scheme.
Vandana put in place a monitoring system to minimize time-wastage by drivers on road.
Drivers were given a daily target in the morning and were required to reach a particular
location by nightfall. With the help of GPS, traffic managers would check if drivers had
reached the target destination by night. Vandana familiarized the drivers with google maps
and showed them how their kms were being recorded accurately. Vandana also re-designed
the responsibilities of management staff to ensure complete back-end support to this                                                         
8 While the company treated drivers as long-term employees, drivers were paid a monthly salary proportionate
to the duration for which they were on the road with their vehicle.
5 of 16 IIMA/OB224 
initiative. Responsibilities of management and staff associated with the driver management
system are listed in Exhibit 3.
Vandana noted that while a typical driver earlier used to take 10 days on a particular route,
gradually he was able to complete the same trip in 7-8 days. She started displaying weekly
status of km runs in the office. She also asked drivers to check their status. In case they were
falling behind in achieving targets, she encouraged them to cover the remaining distance in
the available days. In addition to this, she started displaying photographs of star performers
every month in the company premises. Monthly display of star performers for December
2014 is presented in Exhibit 4 as an illustrative example.
According to Vandana, it took about 4-5 months to refine the system, following which
results started coming in. The drivers who were initially driving around 7000 kms had
crossed 9000 kms in a month and those who were below 6000 kms were eventually driving
around 7000 kms in a month. She observed that almost all drivers had improved their
performance. Vandana also felt that a good relationship had developed between the drivers
and the owners. She shared her happiness with regard to the outcomes and said:
We have won their faith and I got such respect from them which cannot be expressed,
can only be felt.
Vandana continued to meet the drivers in groups or singly and motivated them. She listened
to their problems regarding their work, their demands and noted them down. She shared
their driving figures with them – how much did the driver drive last month, what was the
gap in kms driven, why the fuel average was poor even when the targeted kms were
achieved, where the driver unnecessarily spent an extra day and such.
According to Vandana, sharing of data helped the drivers understand how they could
improve their performance. While drivers did not play a role in setting the targets for the
month, Vandana said:
We have spoken with them initially that these targets are possible. We have their
consent that they will be able to drive as much.
One of the major shifts that the company insisted on was with regard to showing respect
towards the drivers. Vandana expressed:
When I took on the reins of driver management, the first thing I thought was that we
cannot reform the world, but we can reform ourselves.
Vandana began with sensitizing her husband. She also spoke with the managers and asked
them not to shout at the drivers. She believed that drivers’ lives were already tough and by
speaking with them in an angry manner, management team was making their life tougher.
(See Exhibit 5 for details on the typical life of a driver.) She urged them to resolve
differences without scolding the drivers or speaking harshly with them. She asked the
drivers to inform her if someone misbehaved with them. Vandana was hopeful that this
small beginning would be fruitful in the long run. The drivers also appreciated this shift in
organizational culture. Some drivers shared that this was a major difference between
Shivani Carriers and other firms – the staff was good, spoke well with them, no one was
rude to them and the staff helped them when needed.
6 of 16 IIMA/OB224 
Hemant also invested time in speaking with the drivers and in enhancing their self-worth.
He believed very strongly in according respect to drivers:
This industry is unorganized. There is a lot of illiteracy from top to bottom. New
generation drivers are not coming into this profession because there is no certainty in
the profession of a driver. A driver does not know when he will be able to go home.
Further, they receive no respect from anyone including factory people, staff at client
premises, RTO officials, toll booth operators, petrol pump attendants, hotel waiters,
police – they do not get any respect from anyone. We started making our drivers feel
that they are one of the main columns of our industry. We told them that without you
nothing can happen. Without your support we can’t grow. We also told them that the
truck you are driving costs 2 million rupees9 and the material you are carrying costs
2.5 million rupees. If we have given you responsibility worth 5 million rupees, you
are something. You are not a small person. You are something.
He emphasised this communication was important because he wanted to change not only
the drivers’ way of thinking but also their lives. He insisted that his company drivers should
speak properly and carry themselves properly. He believed that if drivers respected
themselves, others would respect them too. He was optimistic and felt that things were
improving because of such conversations with the drivers.
Lack of education also played an important role in the poor performance of drivers. Hemant
felt that drivers were afraid of applying their thinking due to illiteracy. Due to low self-
esteem and lack of confidence, they were unable to come out of their shell and solve the
problems that they faced. They did not try to find out why the police stopped them or did
not question the police when they were harassed. If required papers were in order and
police still harassed them, they did not know how to handle the situation. At the client’s
factory they did not try to find out why unloading was not taking place, who should be
contacted, why material shortage was being recorded or why material was being rejected.
This resulted in time wastage and affected their efficiency too.
Vandana regularly motivated the drivers to educate themselves and acquire basic reading
skills. Typically, drivers would call the manager at short intervals to locate the destination
for cargo-delivery. Vandana thought the ability to read the address would set them free of
this dependence on others. Drivers had to wait for 5-6 hours while the truck was unloaded
or loaded. Vandana advised them to utilize these hours to learn how to read and write. She
also insisted that they should learn to use sms services (at least in Hindi) to communicate.
Sometimes the drivers would get stuck if the traffic manager was not available to receive
their call. She suggested that they could message their concerns to the manager so that he
could call them back at the earliest. She constantly urged them to become more modern in
their work methods.
Hemant advised the drivers to plan their route more efficiently. For instance, he suggested
that when multiple trucks were plying the same route (say, between Kandla (Gujarat) and
Indore (Madhya Pradesh)), these trucks drivers could form a group and include an extra
driver who lived closer to the loading/unloading points. This local driver could monitor the
loading/unloading process for all trucks, while the other drivers could take 2-3 days leave
and stay with their families. Vandana believed that if drivers were able to devote time to
their families, they would be more focused at work too.                                                         
9 1 USD = INR 63.91 (on June 3, 2015)
7 of 16 IIMA/OB224 
SUPPORTING INTERVENTIONS
The company continued to design processes and systems by which drivers could improve
their work methods and their efficiency. Vandana put in place office rules for punctuality,
working hours, leave and performance. Simultaneously, she reassigned some administrative
responsibilities to enhance work efficiency. She also introduced deadlines for routine
administrative tasks and put in a system to ensure that weekly tasks were completed by
Wednesday of the subsequent week. Timely billings meant getting faster payments. The
company could track missing dispatch notes; performance reports and profitability reports
were quickly available. It helped in future planning as well. Vandana insisted during
meetings that employees make the required changes. She sent them email reminders and
appreciation for any target that was met. Gradually the administrative staff also started
adhering to the new system.
The firm upgraded and automated its technological system. They created their own software
for accounting and tracking. Data was maintained online across all branches - from loading
of vehicles until billing. This resulted in significant time saving as a process which earlier
used to take 8-10 days was now completed within 2-3 days. Accuracy of billing also
increased.
The company invested in shifting from open body to closed containers. Closed containers
were important from a safety and security angle and helped to reduce shortage in cargo.
Sometimes after the material was loaded on the truck, a driver had to climb on top to check
if it was tied properly. Due to this, at times the material would get damaged. Closed
containers alleviated this problem. On the road, the drivers had to be vigilant due to the
possibility of theft (called cutting in local slang) by looters and they could not relax even
during rest periods. As a result of closed containers, drivers could shut the doors of the
container and sleep soundly, which improved their efficiency.
All vehicles were GPS enabled for tracking of consignments and clients could also check the
status of their consigments through the company website. GPS also helped to ensure that the
drivers were not driving between 11:00 p.m. and 6:00 a.m. and were taking sufficient rest.
The company had shifted to radial tyres a few years ago and was steadily shifting to
tubeless tyres for all its vehicles. While purchasing a new vehicle, the company took an
AMC (Annual Maintainence Contract) from the manufacturer. Thus, in the event of a
breakdown, their vehicles could be repaired anywhere on the way.
Drivers often asked for more cash-in-hand while driving in order to pay bills at toll booths,
diesel stations, client sites, to police and for personal expenses. There was a risk of theft
involved in carrying too much cash. Some drivers also had a tendency to overspend on
personal expenses and inflate the submitted expenses. The company tried to resolve these
cash related problems by issuing pre-paid petro-cards which could be used instead of cash
for fuel refilling. Vandana was trying to get Bank ATM cards for the drivers so that they
could withdraw cash from ATMs on the way for emergent requirements. The challenge was
to teach the drivers to operate an ATM machine, to keep the card secure and to keep the PIN
confidential. Vandana said the first set of cards had arrived from HDFC Bank and she had
selected 15 drivers, who had some basic education, for disbursement of these cards. Based
on this experiment, she would decide whether to proceed further with this initiative or not.
8 of 16 IIMA/OB224 
While Shivani Carriers did not proactively organize training sessions, it provided premises
for training programmes organized by oil and gas companies and truck manufacturing
companies. Traffic Manager, Malkhan Singh, explained:
We do not organize training programmes. If a company wants to do it, we do it here.
For example, Mahindra provides driver training for new truck models. We send our
drivers for 7 days training. Similarly, a Tata person will come down and drive the
truck with our driver and teach him where he is making a mistake and therefore not
achieving the potential fuel average. Many companies provide such training.
Competition has increased and they have to provide this facility. Other kinds of
trainings include what has to be kept in mind while driving a particular vehicle, how
performance, i.e., fuel consumption, gets affected.
Meanwhile, Vandana continued to counsel drivers to improve their hygiene and appearance
by showering regularly and wearing clean clothes. She shared with them that management
had to feel ashamed and apologize on drivers’ behalf when they misbehaved or fought with
someone. She pointed out that when they behaved badly with others or did not present
themselves well, it reflected poorly on the company’s image, as they were the face of the
company for clients.
EMERGENT CHALLENGES AND CONSTRAINTS
Time management emerged as a primary area of concern. The drivers were expected to start
their vehicles early in the morning by 6:00 or 7:00 a.m. in the morning and stop the vehicle
by 10:00 or 11:00 p.m. in the night. The company did not allow night driving. However,
drivers did not always follow this rule in practice. As one driver mentioned:
Kehtein hain gaadi gyahrah baje tak hi chalao. Phir Munim phone karke kehta hai ki
tum so rahe ho! doosri gaadi toh khaali bhi ho gayi! Phir hum do baje tak chalate hain.
Doosre driver bhi kaam kharab karte hain. (They say drive only till 11:00 p.m.
Then Munim10 will call up and say you are sleeping! Next vehicle has already
unloaded! We drive till 2:00 a.m. then. Other drivers compete too.)11
Holidays were another area of discontent with the drivers complaining that they were not
getting off-days as per their demand. One driver said:
Chutti nahin milti. Kantal jaate hain. Sar kharab ho jaata hai. (We don’t get leave.
We get bored. Our head gets messed up.)
According to Hemant, sometimes targets were set by client companies. If the driver went on
leave these targets could not be met. If they had taken leave the previous month it was not
possible to grant them leave the very next month.
The incentive scheme was a success and had achieved its desired target according to Bharat
Laddha, Management Trainee and Hemant’s nephew. The average running time had gone
up from 6000 km to 7000 km. The scheme was now modified with a new base line and a cap
had been levied on the maximum amount of incentives possible. Under the modified
system, the drivers were required to maintain minimum fuel average along with minimum                                                          
10 Here ‘Munim’ refers to ‘traffic manager’
11 Drivers’ quotes in Hindi have been transliterated to English and a subsequent English translation has been
provided for better understanding of the issues.
9 of 16 IIMA/OB224 
kms driven. Fuel average was a necessary parameter as drivers would engage in tampering
or drive rashly in order to log in more kms. This in turn led to increase in maintainence
costs. The company insisted that a minimum fuel average would be required, only then
extra kms would be considered under the incentive scheme. According to Bharat, the drivers
had demonstrated good performance. They could no longer claim that driving more was not
possible.
The drivers were discontented with the new status of the incentive scheme. As one driver
expressed:
Hum kam kaam karte the, Madam ne kaha zyaada kaam karo. Humne kiya. Par ab
humein humara paisa nahin mil raha hai, average kar rahein hain, phir bhi. (We
used to work less. Madam said work more. We did. But now we are not
getting our incentive even though we are meeting the fuel average.)
Drivers were also claimed that maintainence costs and perks had not been given as
promised. One driver said:
Bole the 25000 milenge maintainence ke. Maine gaadi teen saal tak nahin badli, par
abhi tak kuch nahin mila. (They said I will get INR 25000 for maintainence. I
haven’t changed my vehicle in 3 years. But I have not got anything yet.) 12
Vandana shared that efficiency improvement was a critical performance criterion. She
clarified:
The drivers have to deliver on the required efficiency. If a driver gets incentive in a
particular month, it is not necessary he will get it every month. If the driver’s
performance does not match the desired target, he will lose the incentive.
She further added that drivers got their yearly bonus based on the duration for which they
were on the road. Drivers who had driven for less than a year were not eligible for this
incentive. However, drivers who had completed a year with the company received their
yearly bonus as promised.
The drivers were unhappy that they had not received a salary increment in a long time. One
driver remarked:
Managers ko Diwali par increment milta hai. Humein koi bonus nahin, basic mein
koi badhauti nahin. Humein toh kambal pakda dete hain. (Managers get an
increment on Diwali festival. We don’t get any bonus, no increase in basic
salary; they hand us a shawl.)
While Vandana was sympathetic towards their concerns, she clarified that the company was
not able to increase the salary as they were working on a very thin profit margin. It was not
possible to accept all their demands.
The drivers were upset with the incremental cuts in submitted expenses each time the
expense statement moved from one level to another level. One driver said:                                                      
12 The driver quoted here had spent less than six months on the road.
10 of 16 IIMA/OB224 
Ab pagaar nahin badh rahi. Par hisaab cutting hai. Bees hazaar mein se satraah
hazaar hi mil rahe hain. Kehtein hai tumhari pagaar ke saamne adjust ho gaya hai. Jo
bhi unhone bola, hum tayyar ho gaye, par phal nahin mila. Dil khatta ho jaata hai.
Energy kam ho jaati hai. (Now salary is not increasing, but expenses are being
taken out of our salary. I am getting only INR 17,000 out of 20,000. They say
your expenses are adjusted against your salary. Whatever they asked for, we
became ready to do it, but we did not reap the benefits. We feel hurt. Our
energy decreases.)
They suggested there should be one staff member dedicated to handling expenses. They felt
that because of a few bad apples (who inflated expenses), others were also suffering. They
wanted the concerned manager to check their background and their track record on inflating
expenses while checking the authenticity of their expense statements.
Salary cuts were also based on suspicion of theft, which deeply hurt the drivers. One driver
explained:
Hum yahan se geeli reti load karte hain. Weight kam jata hai jab tak pahunchtein
hain. Geeli rakhein toh bhi. Humein nahin pata kitna load yaan unload hai, par
humari pagaar katt jaati hai. Dry hoga toh udd jaata hai. Kuch material toh short
hoga. Namak toh chor bhi nahin chori karega, koyle ki chori bhi nahin karta hai. By
chance ginti main bhul ho gayi toh uske bhi paise kaatte hain. Khane peene ki cheez
samajh main aati hai, par yeh sab jaise namak yaan mitti lekar kya karenge? (We
load wet sand from here. The weight reduces by the time we reach, even if we
keep it wet. We don’t know how much is loaded or unloaded, but our salary
is cut. Similarly, dry product flies away. Some material is going to be short.
Even a thief does not steal salt. A thief does not steal coal. Even if there is
some mistake in measurement accidently, they cut money for it. If some food
item is stolen, we can understand. But what will we do with salt or sand?)
Another driver said:
Hum par chori ka shaq karte hain. Agar hum chor nahin hain, toh ban jaayenge.
(They suspect us of stealing. If we are not thieves, we will become one.)13
Further, the drivers were dissatisfied with the daily allowance provided to them. One driver
said:
Humein sirf dhai sau rupye milte hain. Chai bhi 10 rupye ki hoti hai. Din mein
chaar-paanch baar toh chai peeyenge hi na. Itne mein kaise chalega. Ab hum truck
mein hi khaana banate hain, paise bachane ke liye. (We get only INR 250 per day
for meal. A cup of tea costs INR 10 and we need atleast 4-5 cups of tea while
driving during the day. How do we suffice in such small amount? Nowadays,
to save money, we run a kitchen in the truck itself.)”
The company claimed that the drivers were already claiming higher expenses than actually
incurred. According to Vandana:                                                       
13 In March 2015, the company introduced a new initiative. As per this initiative, if the calculated shortage were
within 0.5% of the total load, the company would not levy any shortage cost on the driver. Rather, if the
shortage were within the exemption range, the company would reward the drivers with an additional INR 300
per trip, thereby increasing their earning potential by INR 3000 to INR 4000 per month.
11 of 16 IIMA/OB224 
We also know how much should be the expenses for a particular route. But we are
approving expenses on a higher side, because we know the difference amount is for
their regular personal expenses.
Some drivers had worked with the firm for more than 20 years. The drivers appreciated that
the company paid salary regularly and on time, unlike many other firms in the industry.
There were no tyre or diesel-related problems. Workshop services for maintainence were
available and were of good quality. The firm premises had facilities for bathing, food, tea
and for sitting comfortably. In the transportation industry, the firm had a good reputation
and drivers were satisfied to be associated with a “good company.” Driver attrition rate was
approximately 25% every year.
EMPLOYEE WELFARE INITIATIVES
Hemant believed it was important to invest in driver retirement facilities. Shivani Carriers
had provided some basic facilities like retiring room and shower place. They also wanted to
start a kitchen for providing food to the drivers.
There had been occasions where Hemant had funded the medical expenses of drivers in case
of illness and accidents. The drivers said that money was always available in case of
emergency. One driver shared that Hemant had paid INR 15,000 for his medical expenses.
The company had currently susbcribed to a loss-of-earning insurance scheme under which a
driver received a one-time compensation from the insurance firm in case of accident or
permanent disability. Hemant wanted to expand the insurance coverage for drivers to
include regular mediclaim coverage. But he held back as commercial truck drivers were
included in the negative list of insurance companies and hence required high premium.
Vandana wanted to conduct an eye camp for the drivers but due to extraneous factors and
subsequent doctor unavailability, the initiative was put on hold.
THE ROAD AHEAD
Hemant had a desire to grow the company further, to progress further. However, he was
also mindful of the challenges that come with growth. He said:
The size of the fleet makes a fleet owner powerful. But I feel as a fleet grows, control
decreases.
The next milestone was to grow the fleet to a size of 150. Hemant wanted to enhance
management’s working capabilities so that growth could be managed better. He expressed
his priority was to improve their management systems and subsequently expand.
Hemant wanted to create a culture of responsibility and discipline in the firm, wherein
drivers would take responsibility for their work. Vandana also wanted drivers to be more
engaged and more efficient. She wanted them to understand how their work related to the
firm’s profitability. She thought that the drivers did not understand the cost of keeping a
vehicle idle and how it affected firm performance. She shared:
If a person is responsible, he knows what is to be done. If there is a wedding in the
family, a driver takes leave for 10 days. Nowadays, people don’t take 10 days leave for
12 of 16 IIMA/OB224 
their own wedding. The driver needs to understand that this is not possible. If it were
his own vehicle, he would have driven it, right? He would have had to pay insurance
so he would have had to drive. But a driver does not understand this. He gives any
number of reasons for taking leave and takes long vacations.
She wanted them to understand that if they had pending work because of leave, they
needed to drive extra to make up for that pending work.
Both Hemant and Vandana believed that both the drivers and organizations had to change
their orientation in sync with the changing environment. According to Hemant:
The lifestyle of drivers is changing with changing times. They want better amenities
in life. They want to get their kids educated. Earlier most drivers used to be
uneducated, their parents and spouses would be uneducated too and would not have
much exposure to the world. They would not know how much the driver earned or
whether he brought home his full salary or not.
Hemant wanted to get connected with the drivers’ families. He believed that a closer
connection between the company and the drivers’ families would help drivers become more
sincere about their work. Both the company and the family would be able to help the driver
stay away from addictions, gambling, debt, absenteeism and other such problems.
According to him, a direct connection between the company and family would create a
healthy atmosphere both at work and at home. Vandana also felt it was important for
drivers to improve the overall quality of their family lives. She urged drivers to get their
children educated so that they could have better careers and continuously checked if they
needed any help.
As Vandana reflected on their journey, she experienced satisfaction when she thought of the
milestones they had achieved. But she was also concerned about the future direction of the
driver management system. She wondered if she should bring back the special incentive
management scheme to quell employee discontent or introduce alternate initiatives to
manage driver motivation. If she chose to introduce new initiatives, what could these be?
What about the complaints of the drivers? How should she address the complaints of the
drivers? Driver motivation and retention was a primary area of concern for her. At the same
time, she had to take into consideration the profit margins of the company and the need for
future growth. She wondered how she could create a balance between the needs of the
drivers and the needs of the organization.  
13 of 16 IIMA/OB224 
Exhibit 1
Organization Structure
Source: Shivani Carriers, Company records
Exhibit 2
Annual Turnover
YEAR TURNOVER (INR Crores14)
March 31, 2009 14.67
March 31, 2010 25.84
March 31, 2011 32.02
March 31, 2012 34.77
March 31, 2013 34.89
March 31, 2014 40.22
March 31, 2015 50.28
Note: In 2012-13 the business was split and a separate company named Shivani Logistics was incorporated
Source: Shivani Carriers, Company records                                                       
14 1 crore = 10 million
HEMANT LADDHA
Managing Director
Shivani Carriers Pvt.
TRIBHUWAN LADDHA
Director
Shivani Logistics
Workshop
Manager
Traffic
Manager1
Traffic
Manager2
Traffic
Manager3
Accounts
Manager
VANDANA LADDHA
Director
Driver Management
& Fleet Operation
14 of 16 IIMA/OB224 
Exhibit 3
Responsibilities of managementand staff associated with driver management system
Drivers: To drive more and follow the instructions given by managers
Traffic Managers: To help drivers by continuous monitoring and coordination; to give daily targets to
drivers
Branch Managers: To arrange for fast movement by quick unloading, loading and fast paperwork
Workshop Managers: To keep vehicles in up to date condition in order to avoid roadside breakages,
and to also move vehicles out from workshop faster
Management: To ensure coordination between all stakeholders in order to execute the plan
successfully
Source: Shivani Carriers, Company records  
Exhibit 4
Outstanding performers of the Month (December 2014)
Source: Shivani Carriers, Company records
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Exhibit 5
Typical life of a truck driver
The life of truck drivers was extremely tough. Their work required them to be on the road for almost
18 hours each day. Drivers had to stay away from their families for extended periods of time,
sometimes almost for a month.
On road, they had to forgo basic amenities of life such as washroom facilities, safe places to sleep
and hygenic food. There were no facilities available for them to rest enroute or during unloading
phase. Usually they would park their trucks on the road or in the client company’s parking space. If
the unloading took three days, the driver had to live in the parked truck for three days. Sometimes
there was no access to clean drinking water during such wait periods.
The overall appearance of drivers led to many assumptions and stereotypes about them. They were
seen as unkempt because of personal hygiene issues and the way they communicated. The general
impression was that a driver was someone who wore dirty clothes, did not cut his hair, did not shave,
did not take a bath and did not even wash his face on a regular basis. Because of the way they
presented themselves they were shunned by people who interacted with them.
Hotels enroute would treat them with disdain and in many cases would refuse to serve them with
basic courtesy. Toll booth operators, RTO officials, petrol pump attendants, police, staff at client
premises – most people interacted with them in a disrespectful manner. A driver had to cope with
corrupt and difficult officials and with thefts on highways. In some parts of the country, there was a
fear of looting. The drivers felt that the Government was not concerned about their security. According
to the drivers, corruption was rampant. They said, for example, at toll booths officials asked for INR
500 as toll payment and returned a receipt for INR 50. The drivers said that police too were corrupt
and asked for money. According to the drivers, even when their papers were in order, policemen
would hit them or cause damage to their vehicle, for example, by smashing a headlight. One driver15
remarked:

Chor se zyaada policewale se darr lagta hai. Peecha kareinge…chupkar humko
pakad lete hain. Suraksha ke naam par lawaaris hai driver. (We are more afraid of
the police than the thieves. They will follow us. In some states, they hide and pounce
on us. There is no one to look out for the safety of a driver.)
Another driver further shared:
Sab humein gaali dete hain, sab danda maarte hain, paise maangte hain. Koi humein
samajhta nahin hai. (Everybody abuses us, hits us, everybody extorts from us.
Nobody understands us.)
Stories of “hot rooms” where drivers were held captive and beaten up with whips by owners or
managers for theft or other misdemeanours were an open secret in the industry. Even in those firms
where beatings and abuse did not take place, there was a distinct difference in the way drivers were
treated and other staff was treated.
The lack of respect they experienced from everyone was dehumanizing for them. One driver said,
“Humari koi izzat nahin hai. (We have no respect).”
While another driver expressed, “Hum dharti ka bhojh hain, kachre samaan. (We are like burden on
this earth, like garbage.)”
Many drivers were addicted to narcotics like bhang (marijuana), gaanja (cannabis), pills, alchohol and
tobacco. Some were addicted to gambling. Addiction led to time wastage and reduction of efficiency.
In addition, drivers who were addicted were always short of cash and were not able to save anything,
which affected their family lives.
Drivers expressed that they felt trapped by their life circumstances. One driver remarked:                                             
15 The names of drivers have been withheld to maintain their confidentiality.
16 of 16 IIMA/OB224 
Main gaadi chhodkar chutti par bhi nahin jaa sakta na. Koi aur meri jagah le lega. (I
can not leave the vehicle and go on leave. Someone will come and take my place.)
Another said:
Humein koi aur kaam nahin aata hai. Agar chhod doonga toh kuch nahin hai mere
paas. Bas bacchon ko paal rahein hain. Bhookhe marne wale haal hain.” (We do not
know any other work. If I stop, I have nothing. I am barely bringing up my kids. We
will be on the verge of starvation.)
Source: Based on interviews conducted with the drivers by the author