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People Practices | Top 10 trends in employee management

People Practices | Top 10 trends in employee management
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First Published: Mon, Feb 18 2008. 12 13 AM IST

Illustration: Malay Karmakar / Mint
Illustration: Malay Karmakar / Mint
Updated: Mon, Feb 18 2008. 12 13 AM IST
In a knowledge economy, it is people — not capital or market — who make all the difference. As talent occupies centre stage in the Indian workplace, managing and retaining manpower is becoming crucial to an organization’s success. To achieve this, companies across sectors are focusing on some of the more critical HR practices. We identify 10 such trends:
Leadership development
Creating a pipeline of leadership talent is key to a business’ future growth. Peter Cappelli, the George W. Taylor professor of management and director of the Center for Human Resources, The Wharton School, University of Pennsylvania, says it is imperative for the top level of an organization to make leadership talent management a priority, and put its money into long-term plans, as opposed to short-term ones. If companies are worried about their talent pipeline, they have to develop their people, says Cappelli.
Also, a good bench strength helps companies deal with volatility in labour supply. “Companies including Hindustan Unilever, Procter and Gamble and GlaxoSmithKline have been able to withstand attrition in key executives because they have always invested in developing leaders,” says P. Dwarakanath, president, National Human Resource Development Network. Experts say succession planning should not be seen in isolation, but as part of overall organizational development.
Work-life balance
No company or employee has found the Holy Grail of balancing work and life, but that is a work in progress. However, multinationals, information technology (IT) and IT enabled services (ITeS) companies have been able to promote the balance between career, family and leisure-time better. Other sectors have also been increasingly promoting a work-life balance.
Interestingly, most companies in India use benefits such as flexible timings, telecommuting, crèche facilities and concierge services as an attraction and retention strategy. “We are yet to fully buy into the fact that employees become more productive and remain motivated when companies allow them to have a life beyond work,” says Prabir Jha, global head, human resources, Dr Reddy’s Laboratories Ltd.
Experts say companies should see the work-life balance as a business proposition since progressive companies carry business forward with employees and families.
Inclusion and diversity
With higher numbers of Gen Yers joining the workforce in India at a time when companies across the world have an ageing workforce on their rolls, conflicts are to be expected. “One of the challenges companies face today is resolving conflicts among different generations,” says Pavan Bhatia, executive director, human resources, PepsiCo India Holdings Pvt. Ltd. “An
Illustration: Malay Karmakar / Mint
inclusive and diverse workforce is the future of the workplace,” he adds. Therefore, companies are investing both time and resources in ensuring that all age groups are comfortable working together.
Organizations in India have also been focusing on making workplaces more representative. For companies such as ICICI Bank Ltd, Hindustan Unilever Ltd, Vedanta Resources, PepsiCo India, Shell Companies in India and Bharti Airtel Ltd, gender diversity has become a critical area of focus.
“Diversity is a business imperative since it brings diverse skills, ideas and approach to an organization,” says Pallavi Tyagi, general manager, human resources, EI DuPont India Pvt. Ltd.
Health and wellness
The work culture at globalized workplaces involves long working hours, frequent travel, multitasking and tight deadlines — and all this often leaves employees mentally and physically stressed. “Employees are increasingly grappling with lifestyle-related diseases such as hypertension, diabetes and cholesterol, which can be checked by regular monitoring and a healthy lifestyle,” says A. Sudhakar, executive vice-president, human resources, Dabur India.
Companies have begun to realize that healthy employees contribute to higher efficiency and productivity. Apart from medical benefits, companies are also offering yoga classes and health camps and have doctors on campus. HCL Technologies Ltd, for instance, like many other IT companies, has 24/7 medical facilities in all its centres. DuPont has an Intranet-based tool, which assesses an employee’s health through a questionnaire and makes recommendations based on the scores.
Right skilling
Right skilling, or matching jobs with a particular level of training rather than hiring overskilled workers, is gaining currency. Companies use this strategy to tide over a manpower supply crunch and to broaden their talent base. “You don’t need an IITian to supervise a car maker’s shop floor or a management graduate from a premier business school to sell soaps, which largely has been the case,” says T.V. Mohandas Pai, head, human resources, Infosys Technologies Ltd.
Apart from IT and ITeS firms, organizations in the banking and financial services sector, too, have been increasingly hiring graduates and training them. The upside? Lower attrition rates and wage costs. Pai explains that when you have an over-qualified employee, it is very difficult to meet her aspiration levels and, therefore, the chances of the employee moving on to something more challenging are higher.
Managing ‘solid citizens’
“Solid citizens” are the second-rung performers who make up 50-60% of employees in any organization. They are the backbone of any company. Although they contribute significantly to the company’s overall performance, they don’t have the potential to become leaders. “Unfortunately, most organizations focus on the 15-20% key talent at the expense of solid citizens,” says Dwarakanath.
Organizations which neglect their solid citizens are doing this at their own peril, say experts. Unlike star performers who are potential leaders, and therefore more likely to move out of an organization faster, this group provides stability and bench strength to an organization.
Experts say companies need to take a fresh look at solid citizens and invest time and resources in managing and developing this group.
Instant rewards
Recognizing and rewarding performers is one of the most effective tools to attract and retain the right talent. Companies in India are looking at rewards systems more seriously, and are adopting total rewards practices that include compensation in both cash and kind. Apart from lifestyle perquisites such as a house, a car or a club membership, profit-linked incentives, deferred gratuity, and wealth-building programmes in the form of stock options and soft loans, companies are also including work-life balance programmes; competency pay packages where niche skills are compensated; and career opportunities, such as overseas assignments, new projects, etc., to reward staff. These rewards can be tailored to suit the top performers’ aspirations to achieve maximum effect.
Measuring human capital
Evaluation of performance plays a key role, not just in rewarding an individual employee, but also in setting performance benchmarks. And hence, the need for a fair and transparent performance management system. A strong performance analysis helps make human resources both efficient and effective.
“In today’s business environment, where the focus is on increasing performance, companies must have robust systems to identify performers so that the best performers get identified, recognized and duly rewarded,” says Ganesh Shermon, partner and head, human capital advisory service, KPMG India. Shermon cites the example of oil and gas company Bharat Petroleum Ltd, which has instituted a balanced scorecard based on key result areas to measure performance.
Managing aspirations
As aspirations of organizations grow, so do those of employees. And, with the changing lifestyles and profiles of the workforce, personal and professional aspirations of employees are not just varied, but are increasingly on the rise. “Since competitive advantage depends on competent people, knowing what employees aspire for could just be the way to have an edge over competitors,” says Kishore Poduri, head, human resources, eClerx Services Ltd.
Experts say people as well as organizations have aspirations, and when the two get aligned, achieving business goals becomes easier. Dwarakanath suggests companies should be clear about goals of individuals as well as of the organization, and the role each needs to play. The firm should also communicate the goals, and have robust and reliable processes to execute them, he adds.
360 degrees feedback
Finally, recognizing the need to make performance appraisal systems more effective, an increasing number of companies are using the 360 degrees or multi-rater feedback process. Unlike the traditional appraisal system, which gives unidimensional feedback, this one allows an employee to give feedback to her reporting manager, peers, direct reports and others. “Multi-rater feedback not only reduces the risk of biased perceptions, but also gives you a holistic view from all the stakeholders within the company,” says Sanjay Bali, vice-president, HR, Samsung India Electronics Pvt. Ltd.
While most companies started using this system as a means for performance appraisal, most of them now use the 360 degrees feedback system to identify the learning and development needs of employees.
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First Published: Mon, Feb 18 2008. 12 13 AM IST