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PERFORMANCE MANAGEMENT FOR MI SUCCESS

Super Six Approach

MI of today is constantly searching for the star performers who can


produce the best results for the MI, The concept of performance man-
agement gained momentum after the AICTE rules and regulation with
the development in and expansion of management education trough
the mushroom growth of MIs. Performance management in MI is a logi-
cal process by which MI involves its Teachers and non teachers in
improving organizational effectiveness. Since performance
management of any MI is a logical sequential process as guided by
AICTE and the University, it should be planned, designed and
implemented in a systematic and objective manner. A snag at any
stage may damage the basic principle of the MI system. Common
errors occur during the planning of the performance management
system of MI by neglecting some vital ingredients which otherwise
ought to have been included. Some Institutions, as it is observed in the
experience survey are not being able to manage the performance
management system in a professional manner as required by the
AICTE. Even some other MI may not properly utilize the data collected,
but merely conducting the appraisals and other evaluations as routine
annual affair to meet the documentary requirements of LIC of the
university or AICTE. To avoid the major pitfalls and to enjoy the real
taste of this novel and versatile system, MIs need to concentrate on
the six major managerial dimension of the performance management
system which leads to six behavioral dimensions. According to
Armstrong (1994), "Performance management is a process for
establishing shared understanding about what is to be achieved and an
approach to managing and developing people in a way which increases
the probability that will be achieved in the short and long term."

From this definition we could understand for MI that its management


system is development -oriented that examines the past achievements
with future requirements for organizational success and for which the
AICTE/university provides guidelines. The managerial variables
directed by the AICTE for effective performance management in MI
are covered under the following segment of MI administration:-

1. Organization and Governance


2. Financial Resources, Allocation and Utilization
3. Physical Resources (Central Facilities)
4. Human Resources: Faculty And Staff
5. Students Development & Relations
6. Teaching-Learning Processes
7. Supplementary Processes
8. Research & Development and Interaction Effort
In order to facilitate the various functions in above segments of MI
administration the following tools are required to be maneuvered as
per AICTE/University guidelines or statutes given below as an
illustration :-

1. Reward /compensation Management,:- Payment of salaries as


per sixth pay commission

2. HRD:- by introducing the faculty development programme

3. Team Management:-

4. Recruitment and Selection :- Observing the university/Govt.


selection norms with due weightage to reservation policies

5. HR Inventory: - Planning, forecasting, and recording


performance, achievements etc.

6. Appraisal :- Annual performance report top be endorsed by the


employees and endorsed by the Director

7. Feedback : teaching feed back from the students

The organizational aspects covered under effective performance


management are Organizational Culture, Learning and Collaboration,
Communication, Motivation, Organizational Structure, Organizational
Change and Development. Each of the managerial aspects will have
enormous effects on the organizational aspects.

We can see the correlation between the six major managerial aspects
that lead to six organizational aspects as depicted in the Figure.

Though there are numerous other managerial aspects and decisions


leading to different organizational behavior, we will just look in to six
major dimensions in detail.
Howard Management and Motivation

As we all know that there is a clear i iii, direct and transparent relation-
ship between performance management and motivation as the reward
system is based on the performance of the employee and the organiza-
tion, which is the major motivating factor in organizational settings as
postulated in all motivational theories either as need satisfaction or as
expectancy and equity.

Hence it is for the management to reward the employees based on the


performance to motivate them to work further. But undermining this
basic principle, many organizations either may not link the rewards
with the performance or could not match the rewards with the
performance in a proper manner, leading to organizational failure and
conflict. By which they could not attract, maintain and retain talent to
meet the business requirements and competition. Since the reward
system of a company reflects the core philosophy of the organization,
an organization should have a performance management system
which will provide a broad framework for its rewards management and
to motivate its workforce. Hence the organization needs to have the
pay structure and compensation management attractive enough at
least: to retain the talent. And the platform to carry out this task is
certainly performance management system.

Appraisal Feedback and Communication

Feedback from employees is a major channel of upward


communication in organizations nowadays. Not only feedback is a
communication mechanism, but a review program to plan for the
future by forecast. For this, the organizations must open up as much
communication channels as possible to encourage the employees to
freely air their views, thus avoiding conflict and misunderstanding in
future and can help build the organizational learning and collaboration.
IT majors such as Infosys and Wipro could flourish even at the time of
severe setbacks to this sector as they follow open channels of
communication. Among the three major qualities required for a
successful manager such as motivation, leadership and
communication, communication is the basis for the other two qualities.
If a manger is a good communicator, he may able to motivate and lead
the organization to the desired position. Not only for the managers, but
also to all employees working in an organization it is the
communication that links them in their structure. Performance man-
agement with feedback mechanism will help tap this potential for orga-
nizational success. Hence it is quite evident that an effective perfor-
mance management system helps the organizations in terms of the
communication to achieve its mission.
HRD and Learning and Collaboration

Though HRD seems to be a development process no development can


take place without learning. During the course of learning the
employees may have the opportunity to collaborate with the system
and other employees of the organization. Hence the HRD programs
should be designed in such a manner to instill I be habit of both learn-
ing and collaborations among the participants of the program.

The basic data to design the right HRD program can be available from
the performance management records. We can identify the standards
and actual performance of the employees and the gap between the
training and development needs of the employees. Since not all the
needs of the employees are job-oriented for the desired results, some
of them may be of behavioral in nature. Hence proper care should be
taken by the management to identify the proper training needs of dif-
ferent nature to develop skill, knowledge and behavior of the em-
ployees to have a concerted effort for organizational success. HRD
center, must be viewed not only as the learning and development cen-
tet but also as the collaboration center for having better understanding
of the business philosophy of the organization. Once again it is the
performance management that decides the competence and compe-
tency requirements of the organization.

Team Management and Organizational Culture

Team management starts with the forming of the teams. Individual and
organizational culture will play a major role in the formation and
functioning of the team in any organization. Hence before entering into
the team style of management, one has better understand that the
culture prevails in organization. For this, the organizations need to con-
duct attitude surveys among the employees about their job in orga-
nization. Once you start forming the teams after conducting this ex-
ercise, it will definitely produce desired results. The Japanese compa-
nies are successful in team environment because they conduct attitude
surveys before they form any team. Hence organizations while
conducting performance evaluation they should include the aspect of
attitude in their mechanism under competency analysis to get the vital
information for the team formation and its management. As most of
the business now carried out under the team environment, the
organizations should give priority for this aspect to avoid any mishap in
the future.

Self-managed work teams are quite possible only by having this


information on hand. Hence the organization should conduct compe-
tency mapping and performance appraisal simultaneously. Obviously
the performance management is the cornerstone for the team man-
agement in organizations. It is advisable for the organization not to
miss this opportunity for them in their team management.

Recruitment and Selection and Organizational Change and


Development

Like individuals, it is imperative for organizations also to keep apace


with the changes in the business environment whether external or in-
ternal. To make necessary changes in the organizational structure and
other developments such as job redesign, job enrichment and job ro-
tation need validated data such as HR Inventory, Human Capital and
Competency Mapping, etc. All of which might be included in the
performance management system to make effect the necessary
changes in the organization for its development. Hence the
recruitment and selection in the organization must be done only on the
basis of the requirements through the data collected by the
performance management system. As the right selection of the
workforce will give half success, it is for the organization to select
workforce by matching the person fit better with the job and orga-
nization and its culture, which can only be possible if the perfect per-
formance system is practiced in the organization.

Latest change management concepts like job redesign, job enlarge


merit, Job enrichment, job rotation, etc., can he done only on the basis
oi the information provided by the performance management system. I
decisions regarding promotions and transfers can also be undertaken
on the basis of the performance of the employees which also had its
own impact on the recruitment and selection process and on the
organizational change management. It is now understood that the
organization's human capital and change management depends on the
competency requirements which is a part of the performance
management.

Mil Inventory and Leadership

So far, organizations make use of the IIR Inventory mostly for Human
Resource Planning and rarely for Human Capital Assessment. Vital
information concealed with HR Inventory so far is succession planning
to identify the future leaders. By properly conducting Competency
Mapping of the workforce, we can get accurate talent and its potential
for the future challenges. By conducting succession planning we can
identify and nurture talent for tomorrow’s leadership.

Jack Welch, CEO of GE, has set a role model in his period that has
excelled his organization not only in his tenure but also after him. He
has conducted periodic and systematic evaluation of his employees
and imparted leadership skills that lead the business on several fronts
and in different location for years to come. He himself took classes for
the future leaders at Crotonville by founding the world's first corporate
university. Jack Welch later has emphasized that succession planning is
the main reason for the enduring success of GE against the stiff com-
petition from Japanese companies. He has blended business strategy
with the organizational process and practice which produces
resounding success to his business empire even after his tenure as
CEO. It was only the GE which was not affected by the Japanese
competitors not only in the US but in other parts of the world so far.
This is one of the core strategies Jack Welch has followed in his success
story as CEO of GE. Infosys has even institutionalized leadership
training program in its own institute at Mysore named as ILI (Infosys
Leadership Institute) to nurture the future leaders. We could sec the
success story of the Infosys even after Narayana Murthy's departure.
Hence it is quite true that the organizations can make use of the data
collected in the performance management system for succession
planning for enduring business success.

Conclusion

High performing organizations are built around elements such as in-


novation, values, purpose, leadership and trust. However, the core
element which acts as the driving force is "People" working in the or-
ganization. Human resource is the only resource which can give value
to other resources of the organization. Barring human beings every
organization of the same arena will be one and the same. It is the
"people" who are leading and producing results. And simply put, super
six approach of performance management is a key to organizational
success#.

BRANDING
The HR Way

Branding has been around for ages as a means of differentiating the


goods of one producer from another. According to American Marketing
Association, brand has been defined as a "name, term, sign, symbol, or
design, or a combination of them, intended to identify the goods and
services of one seller or group of sellers and to differentiate them from
those of the competitors.

Today's world is very brand con-sc. ions and the need to create brand

#
Reference # 12M-2009-04-11-01
awareness is vital for an organization's survival. We start our day with
a morning jog in Reebok athletic shoes; we eat Maggie noodles; we go
to work dressed in a Reid & Taylor suit in a new Innova car, and stop
on the way for having a cup of coffee at Cafe Coffee Day. What do
these statements signify? It does not imply just a pair of shoes, a
breakfast, clothes or a car. Rut it shows the importance of the concept
of branding in the minds of t he-people. These brands are chosen by an
individual as they not only take care of the basic needs, but also
deliver the promises to the individual customers. These brands simplify
decision-making and communicate the values they create to the cus-
tomers.

The same strategy which is applicable to products is also applicable to


HR Department which can be called "MR Branding". Conventionally the
corporate leaders have basically concentrated on areas such as
marketing and sales, product development, etc. But of [ate more and
more eyes are shifting towards the IIR department. Traditionally
branding in IIR was limited to employment function. But now IIR
branding is a new concept which has evinced a lot of interest. The
various .sub-systems of the MR department in the organization must
strive to create a Unique Selling Proposition (MSP) o( the company so
that the organization can glow in a big way in the long run.

In today's knowledge-driven economy, MR plays a strategic role in


bringing in the right people into the right organization. In other words,
MR is the first face of an organization for a new prospective employee.
Market research has revealed that strong brands contribute to strong
competitive presence. In this way, it has been understood that HR
branding has become important for the organization to attract, retain
and motivate people to enhance the organization's growth.

Today's organizations are more complex and follow an open system


policy. The organizations which have been successful have the best
people strategies and the best business strategies. It is important to
align these two strategies to create a favorable work climate. The HR
brand has to be aligned congruently with what the company delivers to
the employee, customer, public and shareholder.

What is HR Brand?

"The package of functional, economical and psychological benefits


provided by the employment and identified with the employing com-
pany. The following aspects can be highlighted under each:

• Functional benefits would include —useful job-related activities


which impart technical skills.
• Economical benefits would include—materialistic or monetary
rewards.

• Psychological benefits would include—recognition, sense of


belongingness, purpose of stay in the organization, etc." (Ambler
and Barrow, 1997).

The combination of these factors differentiates one employer from


another and helps in shaping the perceptions of the past, present and
future employees. Customers differentiate firms by their products and
similarly employees differentiate their jobs by HR branding. HR
branding has also been called employer branding.

Evolution of HR as a "Brand"

The Figure shows four stages:

Stage 1

Branding as a concept was well-defined, but played a major role in pro-


tecting the logo, or name of a particular product service or business.
The HR department played a very little or no role in supporting the
brand.

Stage 2

Later the companies had a master brand or logo which gave more
emhasis to vision and values of the enterprise. HR's role was to be sup-
portive to individual brands.

Stage 3

Companies could now capitalize on the vision and values of a strong


corporate brand to bring about organizational change, such as in
bringing together units through mergers. HR's role had enhanced as
they became the key players in aligning these change programs.

Stage 4

The corporate brand is currently the centerpiece of the overall strategy


with HR holding a pivotal role in facilitating employees to act as 'brand
ambassadors'.

The brand ambassadors are the ones who will carry the name of the
organization to the external customers. They talk for the quality
practices of the HR department.

Brand as a System
Brand can be considered a system. 1 he brand system has four compo-
nents which are inextricably tied and interdependent. The four com-
ponents can be highlighted as follows:

• Offer.

• Identity.

• Experience.

• Image.

• Otter

This is what an organization can give to its customers both internal and
external customers. It is the service or a group of services that the
brand renders to its customers. It should he in simple terms so that it
would be easy to communicate the offer to the target segment. Hence
the offer should be clearly described tor a brand to be successful. In
the context of HR, offer could be visualized as the following—Compen-
sation package, training programs, employee assistance programs, a
good working environment, etc.

Identity

Brand identity implies how a customer actually perceives a brand or a


company. Identity assists in attracting attention, setting expectations
and making an impression. Names, logos, slogans, advertising,

packaging, vision and mission statement of the HR department make


up the brand identity. This provides information to employees to deter-
mine an impression on the HR department. For example, when we
meet an employee from Infosys he says he is an "Infosion" and an em-
ployee of Wipro says, he is a "Wiproite". This suggests the way the
internal employees associate themselves with the organization and
identify themselves with the organization. This is mainly due to the HR
policies and procedures which have kept the employees satisfaction.
Satisfied employees are an asset to the organization.

As the functions of HR are spreading across the organization, the


services rendered by the HR department to the employees can be
treated as the same thing as selling services to the external customer.
There are different elements which help an employee identify and dif-
ferentiate an organization from the other which is called brand
element. Hence the HR department must take care of its brand
identity.
Image

Brand image is what people think of the brand. The internal customers
are the people who carry the brand image forward. This is primarily
based on the interactions with the HR department. The first interaction
with the organization helps in creating a brand image for the
organization. For example, the way the secretary interacts with the
prospective employee, the hospitality of the organization, etc., can
help them bridge the gap between brand image and brand identity.

Experience

Brand experience is the aggregate of all the perceptions that result


from the interactions with a brand. But all the experiences are not
equal. Employees assign different levels of importance to different
facets of their experience. Favorable experiences create positive brand
experience and vice versa.

Brand Building Blocks

Every company, big or small, has an image. The labor market and the
employees judge the organization based on their image. And the most
successful companies have cohesive and compelling brand identities.
The building blocks to successful business are not just a quality prod-
uct, a nice logo, a good market share, etc. The market has plenty of
that. What the people are looking for is a reason to join X Company
instead of Y Company. This is where branding comes in. A good brand
is one that lasts through the ever-changing trends, is molded from the
company's core values.

In building strong brands, "creating a brand identity is more than


finding out what employees say they want. It must also reflect the soul
and vision of the brand, what it hopes to achieve."

4 Ps of HR

Marketing has developed the four Ps—Product, Price, Place, and Pro-
motion. This has been enhanced to seven Ps in the current scenario. In
the same way, if we can develop 4 Ps for the FIR—People,
Package/Pay, Performance and Prospects. A brand is a part of a
product which helps in differentiating the products in one way or the
other. These differences may be rational and tangible—related to the
performance of the prod

net or more symbolic, emotional and intangible-related to what the


brand represents. Hence if this can be applied to an organization,
tangible issues of the organization could be the package and
performance of the company and the intangible issues could be the
people and prospects.

People

These are the most valuable assets of any enterprise. They are the
only assets who do not depreciate over a period of time, but
appreciate with better training and exposure. The concept of people
would include both the internal and the external customers. The
challenge faced while structuring the brand is to establish a
sustainable strong partnership with both internal and external
customers. The ability to see the organization with a broader and a
fuller view is more important, based on the interactions of HR depart-
ment with both internal and external customers.

The internal customers in this context would mean the employees who
are already working in the organization and external customers would
mean the people who are residing outside the organization. The
external customers are the group; with whom the organization has in-
direct interaction whereas they have direct interaction with the internal
customers. HR department should take decisions that would not
discourage employees from being aligned to the brand behavior.
Initially we have to build a brand internally that is possible by making
high participation of internal customers in benefit plans, training
programs and company functions. Performance plans, compensation
programs, and policies and procedures, employee assistance pro-
grams, meditation services lead to higher satisfaction ratings on em-
ployee attitude surveys.

If an organization wants its brand to be perceived as more strategic,


more valuable, more reliable, it needs to think about what internal and
external customers expect from it, how well it can deliver, and how
well it can progress. This cannot be achieved by fancy packages,
catchy slogans and name changes, either. This is achieved by thinking
like a business with a product to be developed, marketed and reliably
delivered to customers who want your services.

The brand 'HR' can be well built by concentrating on the factors, which
directly or indirectly influence the expectations of an employee, which
is both the employment and psychological contract of the employee
with the organization. Employment contract includes all those tangible
items which are extrinsic, like the actual salary or the CTC, the working
hours, the number of leaves, etc. On the other hand, every employee
will establish an unwritten contract called psychological contract. This
includes the working conditions, the superior-subordinate relationship,
the general working environment, etc. The brand name of an
organization can be identified with both the employment and the
psychological contract. Most of the times the organization satisfies the
employee's employment contract as it is in black

and white. But if they are not able to satisfy their psychological con-
tract, then there would be a problem of retaining the employees. The
brand name of the company would also be harmed to some extent.

Package/Pay

A competitive package plays a very important role in maintaining the


brand HR. It is of prime importance to take care of the compensation
within the organizations to establish equity among the employees.
Equity embraces the concept of fairness. Pay equity refers to an
employee's perception that the compensation received is equal to the
value of the work performed. A branded organization would generally
establish both internal and external equity. Compensation policies
would be internally equitable when the employees believe that the
wage rates for their jobs approximate the job's worth to the or-
ganization. Perceptions of external pay equity exist when the organiza-
tion is paying wages that are relatively equal to what the other em-
ployers are paying for similar types of work. The term "pay for perfor-
mance" has been extensively used in today's organizations. It refers to
a wide range of compensation options, including merit-based pay,
bonuses, salary, perks and team and group incentives.

Performance

This factor can be viewed in two dimensions. First dimension is—

Actual performance of the company and the second is performance


management. The actual performance of the company can be judged
form the balance sheet. If the profit of the organization is in the
increasing trend, then it can he inferred that the performance of the
organization is good. Performance management is the process of
creating a work environment in which people can perform to the best
of their abilities. The actual performance of the organization is an
extrinsic variable whereas performance management is an intrinsic
variable. Both these variables play an important role in creating a
brand name for the organization.

Performance management leads to continuous improvement and


enhanced learning. It creates team environment and helps in improv-
ing the organization as a whole. Hence performance management can
focus on the performance of the organization, a department, processes
to build a product or service, employees, etc. The four key benefits of a
performance management are:
• Focuses on results, rather than behaviors and activities.

• Aligns organizational activities and processes to the goals of the


organization.

• Cultivates a system-wide, long-term view of the organization.

• Produces meaningful measure ments.

Prospects

Ibis component of HR discusses the need for career development and


advancement within the organization. Every employer who enters the
organization must have a clarity of the career progression available for
his/her growth. The job progressions serve as a basis for developing
career paths—the lines of advancement within the organization for
individuals. Most of the organizations prepare interesting and
attractive brochures to describe the career paths that are available to
the employees. General Motors has prepared a career development
guide that groups jobs by fields of work such as engineering,
manufacturing, communications, data processing, financial, HR, and
scientific. These categories help the employees in ascertaining the
career possibilities in the organization.

A career plateau is a situation in which for either organizational or


personal reasons the probability of moving up the career ladder is low.
This is a situation when the employees may tend to leave the organiza-
tion. Branded organizations help individuals cope with plateaus by
providing opportunities for lateral growth when opportunities for ad-
vancement exist. Career management is a joint responsibility of both
the employer and the employee. Providing promising career devel-
opment initiatives will help organization build a good HR brand.

"High Performance" HRM Practices

The following are the high Performance HRM Practices which can help
in building a consistent HR brand.

• Highly selective hiring and focus on attitudes and cultural fit.

• Extensive training and skill development.

• Self-managed teams and decentralization of decision-making.

• Equal importance to both technical as well as conceptual skills.

• Reduction of status distinctions and wage inequality.


• Employment security.

• Comparatively a better compensation package.

• Organizational performance and employee ownership.

• Transparency in both financial and general performance of the


organization.

Benefits of Building a Brand for HR Department

• It improves credibility and strengthens the bonds of trust


between HR department and the employees.

• It acts as a catalyst for pushing change.

• It is shorthand communication for getting the message out.

• It helps in recruitment and retention of the best possible em-


ployee.

• It enhances the performance and commitment of the employees.

• It helps in maintaining brand integrity.

• It aligns the individuals' goals with the business strategy.

Conclusion

Why do we go for brands? The answer is simple—reliability. It's the


popular brands which provide this reliability. Attracting knowledge
workers has become a Herculean task for the HR department. Only the
best practices and the best environment can assure their interest in
working for an organization. The practices and policies of the HR de-
partment and its outlook create a certain brand for the HR. The better
the brand, the better are the chances that an organization can attract
the best talent.*

harder to learn. There are educational opportunities for executives.


There are no "crash courses" in learning for a new group of people- it
just takes time.

You may find the person you have promoted, progressing much faster
than an external recruit.
*
Reference* 12M-2009-04-12-01
Designing a leadership development program The belief that leaders
were born with their qualities is slowly getting eroded and a positive
realization has set in, according to which, development of leadership
skills is possible through correct training. This has led several business
and educational organizations to create leadership development
programs. Although it is gratifying to know that even if you do not
possess good leadership skills, you may be able to develop them; the
process itself is not easy. It requires focus, practice and patience, it
cannot be devejopcd in a day. It is almost like learning a new form of
dance or learning a new musical instrument which cannot be mastered
until and unless it is practiced thoroughly often starting with injuries or
breaking of strings.

Some of the thoughts that need to put across while developing


programs on leadership development are:

1) Leadership development needs to be viewed as a process not an


event. Within this lifelong process, intensive periods of time
(typically 6-12 months) need to be devoted to improving specific
leadership behaviors. Throughout this period leaders should be
engaged in an integrated set of learning experiences such as 360
degree assessment, experiential skill development programs,
individual goal setting and development planning, on-the-job
learning projects, reflective journaling, mentoring, professional
reading and reflective conversations.

2) Leadership development should he needs not wants driven.


Given the difficulty in successfully developing new leadership
habits, it is important to focus on those aspects of leadership
where behavioral change would have the highest amount of
impact. At an individual level this involves some form of
assessment to identify leadership strengths and developmental
needs, and then comparing these developmental needs to the
leadership behaviors that are most important to achieving
results within that leader's context. This process culminates in
the setting of 1 -3 developmental goals that the individual leader
seeks to achieve within a 6-12 month period. At a group and
organizational level, collective assessment results, coupled with
a strategic needs analysis can be used to identify key common
needs.

3) A common and effective way to kick start the subsequent


learning journey is through an experiential learning program or a
set of experiential skill development programs. These programs
may provide the time and space for leaders to digest their
assessment results, set their development goals and develop
their learning plan. They should also include opportunities for
participants to be presented with goal relevant, evidence based
and practical leadership skill models along with opportunities to
practice these new skills within simulated environments.

4) Each participant should be engaged in goal specific on-the-job


learning projects. These are real workplace projects which
require the person to effectively use goal related behaviors for
the project to succeed.

5) Sustained behavioral change is far more likely if, throughout the


6-12 month learning journey, leaders engage in reflective
learning practices. These include reflective journaling and
reflective coaching conversations.

6) Mentoring can also play an important supporting role over a


leader's 6-12 month learning journey. Rather than seeking out a
mentor based on seniority or overall leadership prowess, leaders
should find mentors who are effective within their specific goal
area.

7) Finally, leaders should be held accountable for achieving their


goals and making behavioral changes within their workplace.

Leadership development programs cannot rely solely on class room


learning, leadership cannot he taught but must be experienced. You
can teach the values of strong leadership and share examples of
successful leaders and their actions. The individual developing leader
needs to be able to create his or her own plan to closing their unique
gaps and growing their unique skills. Leadership

India Leadership Strategy 2008

Ail critical heads of businesses development is not about teaching how


to fill-in neither' a daily task list nor it is about reconciling
expenditures. Leadership development is about helping people
become inspired teams and individuals to create the future while still
completing the day-to-day activities of your business.

The leadership development process helps leaders understand that


they are accountable for the environment that they create and
whether the environment is based on trust or lack of it. The process
provides them with knowledge, skills and applications that they need
to create an environment based on trust and personal responsibility.

Leadership development programs may not always be a success, there


may be some failures in way of developing leaders but companies that
make leadership development as a core business process can
overcome these failures by preparing the individuals and teams they
will need to take their organizations to greater heights.

Agilent Technologies India, is one of the successful examples in the


implementation of leadership development which is a high priority in
the organization.

The India Leadership Strategy program at Agilent is a 4-Tier strategy


for Leadership development in the country. Leaders and individual
contributors are chosen from across businesses and locations to
become part of one of the Tiers of the India Leadership Strategy. Each
of the 'Tiers' has a unique leadership development roadmap behind it,
through which these individuals are taken in the year.

The overall objective of India Leadership Strategy is to strengthen and


deepen the leadership bench in India by accelerating the development
of today's and tomorrow's leaders.

The participants of India Leadership Strategy are not segregated into


different 'Tiers' based on their level, but based on the 'criticality' of the
role they perform in Agilent India.

Given below is the India Leadership Strategy, Tier I| roadmap for 2008
as an example to how a roadmap within a Tier looks like. All roadmaps
arc a good mix of different learning experiences such as on-the-job
experience, 360 surveys, mentoring programs, classroom training and
executive coaching etc.

To conclude we can say that developing / nurturing leaders is the need


of the day in today's organizations to build up leadership
competencies. There is no right or wrong way to do things; it is the
current scenario of your organization (business / growth / industry)
which will make either growing from within or looking out externally a
favorable proposition.

'The single biggest way to impact an organization is to focus on


leadership development. There is almost no limit to the potential of an
organization that recruits good people, raises them up as leaders and
continually develops them.

Padma Kinger is a project manager with The Great Place In Work®


Institute India. She can be reached at pkinger@greatplacetowork.in.
Views expressed in personal. For more information on participating in
the Economic limes an गreat place to Work® Institute's India’s Best
Companies to Work For 2009 contact Basuri Dutta at
bdutta@greatplacelowork.in or at 09920866406
Most business authorities believe that Talent Management (TM) has
emerged as an important global business challenge. In developed
economies, employers anticipate many experienced workers to retire,
creating a vacuum of talent that will not be easy to fill; in developing
economies, talent needs are fueled by explosive business expansion
and pending waves of retirements. Typically, TM has focused on
attracting, developing and retaining talented people. But that is not
enough for the future. Organizations will need next generation talent
management.

Manae

F
ew business authorities question that Talent Management (TM) is
a key global challenge (Goretsky and Pettry, 2007; Rowh, 2007;
and Shadovitz, 2007). Indeed, "nearly three-quarters of the 413
US human resources professionals queried for the 2008 Top Five Total
Rewards Priorities Survey, conducted by Deloitte Consulting and the
International Society of Certified Employee Benefit Specialists
(ISCEBS), cited talent as their top concern" (Talent shortage,' 2008). In
developed economies, TM commands attention due to aging workforce
that is expected to retire at any moment. In developing economies, TM
generates interest due to explosive business growth, aging workforce,
and widespread hijacking of talent across national borders.

While TM is sometimes a term in search of a meaning, traditional talent


management is usually understood to mean systematic efforts to
recruit, develop and retain highly productive and promotable people
(Rothwell and Kazanas, 2004). But the needs of businesses really go
well beyond that. There is thus a need to think beyond traditional
talent management to Next Generation Talent Management (NGTM).

What model can help practitioners conceptualize

NGTM? How can practitioners get started in implementing NGTM?» This


article addresses these key' questions.

What Model Can Help Practitioners Conceptualize NGTM?

All best practice approaches to talent management share a common


element: they are guided by a strategic model that helps practitioners
integrate, and communicate to stakeholders, how all the individual
efforts fit together systematically. The NGTM goes beyond the mere
consideration of identifying, developing and retaining productive and
promotable people. It includes considering how the work is performed
(which will change performance and promotability requirements),
inventorying in-house experts (known as high professionals),
considering ethics and values as well as performance, preparing for the
transfer of specialized knowledge, and preparing for the transfer of
social networks. The NGTM is often integrated with a career planning
program in which individuals are challenged to clarify their future life/
career goals and identify their own i developmental needs to meet
their I career goals (Rothwell, Jackson, j Knight, Lindholm, 2005).

See Exhibit 1 for a model that delineates next generation talent


management. The steps of the model are described below. And
enacting a leadership role in NGTM is one strategic choice for an HR
department that has undergone successful HR transformation
(Rothwell, Prescott and Taylor, 2008).

Step 1: Get Commitment, Clarify Roies and Goals, and Build

Accountabilities

No TM effort can thrive unless it enjoys the full commitment of top,


middle and lower-level managers. For that reason, securing—and
sustaining — manage m ent commitment is the essential first step.
Managers must do more than pay lip service to TM. They must
demonstrate efforts to support it every day through their actions. They
must devote personal time to it.

Each key group of stakeholders in the organization—top managers,


middle managers, first-line managers and workers—has a roles to play
in the TM effort. These roles must be clarified and communicated.
Further, individuals must he held accountable for carrying out their
roles and getting results. One way to do that is to build talent
acquisition! | development and retention directly into the Key
Performance Indicators (KPIs) of each manager. A second way is to
reward people for'; achieviflg measurable talent management goals.

(TM efforts may, of course, have many goals. These must be clarified
and prioritized. Managers must agree on them so that the TM does not
try to be all things to all people.

Typical TM goals may include the following: , . . , *,,

• Preparing sufficiently well- *"* qualified replacements before key


leaders retire.

• Preparing sufficient numbers of well-qualified people to support


business expansion.

• Recruiting high potentials from outside the organization.


• Developing high potentials inside the organization.

• Role-modeling TM efforts by developing self and others.

Of course, many such goals may exist. The goals should be formulated
based on business needs and should be made measurable.

Step 2: Clarify What Work People Do, What People Successfully Do the
Work, and Who Possesses Special Knowledge and Special Social
Relationships £.

It is not possible to implement an effective TM program if it is not clear


what work people do and what kind of people are needed to do the
work. Hence, it is necessary to update job descriptions, which describe
the work that people do, and formulate competency models, which
describe the successful people who do the work. Job descriptions must,
of course, be tailored to meet the unique needs of the organization.
The same principle also applies to competency models, which are
influenced by the corporate culture.

One way that organizational leaders can influence the organization's


talent requirements is by changing how the work is done. If work is
outsourced, insourced, simplified, process-improved or otherwise
changed, then the competencies required to do the work is changed.
Hence, it is possible to change what competencies are needed to
accomplish organizational goals by changing who does the work and
how they do it.

The NGTM goes beyond traditional TM by adding other elements as


well. It pinpoints who. possesses special knowledge, such as
institutional memory or special proprietary knowledge of the business.
That issue is Usually understood to refer to the so-called knowledge
transfer problem. Efforts to solve the problem center around technical
succession planning (Rothwell and Poduch, 2004) and usually require
practical solutions (See Rothwell, 2004).

When experienced people retire or otherwise leave an organization,


they also take with them the social relationships that they have
cultivated over the years. These relationships have practical value,
since customers, suppliers, distributors and other key organizational
stakeholders have usually developed trusting relationships in working
with individuals in organizations. When those individuals leave, the
stakeholders are necessarily sure they can trust the successors. There
is thus need to plan for social relationship succession (Rothwell 2007).

Step 3: Evaluate Present Performance


Performance management is essential to any TM program. While
individuals should not be promoted solely because they are performing
well in their present jobs, it is also true that they should not be
promoted if they are failing in their current jobs. Effective performance
management programs should measure both results (such as Key
Performance Indicators (KPIs) and the behaviors linked to the essential
to job success.

Step 4: Recruit and Select Appropriate People from Inside and


Outside the Organization

There are two ways to secure talent—develop it from inside the


organization or recruit it from outside. It is thus essential to think
creatively to outcompete other organizations in recruiting talent. At the
same time, most organizational leaders should review their job posting
and other internal recruitment programs to ensure that the best
qualified people are being recruited for each vacancy.

(In some organizations, managers hoard talent.)

Selection methods sho,uld.also be_examined. On what basis are


people being chosen? Are the approaches based on the competencies
essential to job success? Or are other and perhaps less performance-
oriented, criteria being used in selection? A trend in selection is to use
multiple methods to judge the suitability of job applicants and
demonstrate the competencies linked to success.

A growing issue is an organization's ability to attract, develop and


retainjpeople who are beyond traditional retirement ages (Rothwell,
Sterns, Spokus, and Reaser, 2008). There are many reasons why
retirees may be attractive. One is that they need less training to do
their jobs and be productive. Another is that they can help to provide
coaching—and even executive coaching-r-to break in successors or
less experienced workers.

Step 5: Formulate Future Talent <h^ Requirements and Align with


Strategic Objectives

W.,Talent requirements.do not remain static. As organizational leaders


pursue their strategic plans, talent requirements must be revised to
ensure that people are being considered for promotion based on
future, rather than merely present, talent requirements. After all,
people must be prepared for promotion based on future needs, not
always current ones. It takes time to develop people and for that
reason it is essential to consider future talent requirements and align
them to the organization's strategic objectives.
Step 6: Assess Individual Potential for Promotion and
Individual Values and Ethics

Assessing individual potential is all about determining if people can


perform at higher responsibility levels. It is commonly called potential
assessment (Rothwell, 2005b). Good performers at one level—as
measured by systematic performance management—will not
necessarily perform well at higher levels of responsibility because
different competencies are required. Common approaches to assessing
potential include manager nominations, multi-rater assessments,
psychological tests,, assessment centers, realistic job tryouts, and
work samples. While potential assessment usually focuses on
comparing individuals to the competencies required at higher levels of
responsibility, recent thinking has suggested that organizational
leaders should also measure individuals against corporate values and
corporate codes of ethical conduct.

Step 7: Inventory Existing Talent

How quickly and effectively can an organization marshal its talent in a


crisis? Finding talent is often done informally by asking managers. But
that is not necessarily an effective, or speedy, approach. And large
organizations face a particular challenge because there are so many
people and each individual may possess unique talents and may eyen
be a high professional in his or her own right. How easy is it to find
talent when it is needed? Organizational leaders should thus establish
competency inventories based on the problems faced by the
organization, to catalog and find talent quicker. Time is a strategic
issue and finding talent quickly can make the difference between
competitive success—or failure.

Step 8: Plan for Individual Development

How are individuals groomed for higher levels of responsibility? The


most common way is to establish Individual Development Plans (IDPs)
to narrow developmental gaps between what competencies people
must possess to be qualified for promotion and what competencies
they presently possess. Many organizations have established Learning
Management Systems (LMSs) that make it easy for individuals to
pinpoint appropriate methods to build their competencies. Typically,
IDPs indicate what competencies people need to develop, how they will
do it, what resources they will use to do it, and how their learning will
be measured or otherwise assessed.

Some approaches to developing individuals may be group-oriented,


such as in-house leadership development programs (Rothwell &
Kazanas, 1999). Others may be hands-on in which individuals are given
specific action learning projects that build their competencies while
individuals are learning from others (Rothwell, 1999). Still others can
be individualized and may include on-the-job learning or on-the-job
coaching.

Step 9: Systematically Retain People and Transfer Knowledge


and Social Relationships

Few organizations have systematic retention programs that are geared


to keeping the best people. Exit interviews are just not enough
(Rothwell, 2005a). More often, retention is handled on a case-by- case
basis. Unfortunately, such ad hoc approaches usually result in treating
some people differently from others—thereby creating ill-will and
eventually prompting more turnover. What is needed is a consistent
organizational approach to retention that makes use of best practices
in retention systematically (Rothwell, 2007).

Organizational leaders should also take effective steps to transfer the


special knowledge of high professionals—sometimes called in-house
experts or high professionals (HiPros)—who are not necessarily
promotable but who possess specialized competencies in solving
unique problems confronting the organization. Such experts can be
highly effective mentors when they are willing to transfer some of what
they know to others.

Finally, organizational leaders should also take steps to transfer social


relationships. That is highly challenging. Many people have established
a broad social network to help them do their jobs. For instance, some
salespeople are highly effective in finding the best people to make
decisions on sales. When these salespeople leave the organization for
retirement, these social contacts are lost. But it is not as simple as
making introductions rather, customers and others must j learn to trust
successors. It is thus \ necessary to groom successors |-through a
series of projects so that customers learn to trust them. Of t course,
social relationships can also exist in occupations outside sales, I and
they are just as important to transfer to successors (Rothwell, I 2007).

Step 10: Evaluate Results

Evaluating TM programs is a topical issue (Rothwell and Kim, 2005).

Many executives and HR practitioners wonder how to evaluate talent


programs. The NGTM programs, however, are evaluated by metrics
established from the initial goals identified for the program. Suppose,
for instance, that a goal of a talent program is to groom successors in
preparation for a wave of expected top management retirements. In
that example, it would (of course) be appropriate to measure the
program based on how many and how well individuals are prepared to
meet that goal. That can be tracked annually.

Use the instrument appearing in Exhibit 2 to rate how well your


organization matches up to the practices of NGTM.

How Can Practitioners Get Started in Implementing NGTM?

There are three basic ways to start a next generation talent


management program.

The first approach m to focus at first on" replacement planning. While


often confused with succession planning or even TM, a replacement
planning program • identifies back-ups for key people or key positions
in the event of sudden, catastrophic loss or even temporary times
away from the job. While many organizations have already prepared
replacement charts to identify permanent or acT^ig^eT^Tacemeritrin
the event of a sudden loss—such as the plane carrying the CEO or
even the entire senior executive team crashing— not all organizations
have done so. It is a good place to start because the results can be
secured quickly. Replacement charts also raise many program.

The second approach is to focus at first on top-down TM. It usually


Begins with an assessment of the senior executive team. An advantage
of that approach is that it leads senior managers to become familiar
with and help shape, the TM program. But the disadvantage is that, to
roll out the program to lower levels of the organization, the right
infrastructure (such as a robust human resource management system
and credible HR professionals) must be in place to support that
implementation.

The third approach is to focus at first on a trouble spot in the


organization. Pilot test a TM work very well because it relies for support
on the manager of the pilot-test group rather than a CEO who may be
removed from daily operations. If success is attained in the pilot test,
then snowballing the program to other groups become more likely.

Conclusion

Few business authorities question that talent management is a key


national borders—as well as pending retirements and talent needed to
fuel explosive business expansion.

Traditional talent management, limited merely to attracting,


developing and retaining talented people, is not enough.) Today's
organizations need NGTM. A model governing that approach consists
of 10-kcy steps: (1) get commitment, clarify roles and goals, and build
accountabilities; (2) clarify what work people do, what people
successfully do the work and who possesses special knowledge and
special social relationships; (3) recruit and select appropriate people
from inside and outside the organization; (5) formulate future talent
requirements and align with strategic objectives; (6) assess individual
potential for promotion and individual values and ethics; (7) inventory
existing talent; (8) plan for individual development; (9) systematically
retain people and transfer knowledge and social relationships; and (10)
evaluate results.

There are three places to launch a NGTM program. The first approach
is to start with simple replacement planning and gradually ease into a
more robust effort. The second approach is to start from the top down.
The third approach is to start in a trouble spot*.

ADSFAAASDFFFFFFFFFFFFFFFFFF…………………………………………………………………
…………………………………………………………………………

*
Reference # 12M-2008-10-03-01
TALENT MANAGEMENT
Some Profound Considerations for the Human Resources Practitioner

Talent management is an elusive construct if, one takes the time to


actually think about an operational definition of this entity. It is
essential to think about several aspects of this construct if one is going
to actually implement a talent management program within an
organization. This article delves into this elusive construct and offers
some insights into talent management or leadership.
LEADERSHIP

Talent Management has been a buzzword since the 1990s. The


popularity of this process is evident in an online research through a
popular search engine that yielded over 7,69,90,000 hits on the phrase
‘talent management’. Unfortunately, most of the research in the area
of talent management has been confined to speculative comments and
to self-reports from CEOs and other business leaders. These
assumptions by organizational leaders may have contributed to the
plethora of definitions for what talent management means.

Commonly, talent management implies a process where the employee


is placed on a career path to develop his skills that the organization
perceives are valuable. The hope of the organization is that the
employee will remain with the organization so that the organization
can receive a benefit from its investment in the employee. Sometimes,
talent management implies an outsourcing process where the
organization selects talent outside the organization to fill internal
needs. In this instance, talent is acquired rather than developed. This
organizational practice has become more common in the past 10 years
as the demand for talent has increased and the apparent pool of talent
has decreased.

This apparent scarcity of talent has created "The War for Talent". One
of the outcomes of this war is the tactic of posting new organizational
job opportunities internally so that talented employees remain
employed within the organization if they sense a need to change their
current position. However, social science researchers have linked fear
of scarcity as a precursor to diminished creativity and to an
unwillingness to take risks resulting in organizations stifling self-
directed learning practices. Therefore, what is a plausible solution to
this dilemma/ Perhaps, a starting point is to deconstruct talent
management to explore its nuances for some vital clues.

Talent implies creativity, freedom and curiosity. Talent becomes


evident when solutions are not apparent. Scholars describe talent as
valuable and hard to imitate because it is essentially unpredictable.
Talent discovers treasures without having a map. In contrast,
management implies control and predictability. To manage something
is to have influence or the ability to enforce compliance. The notion of
combining talent with management seems to be paradoxical. To allow
talent to flourish seems to negate the notion of the ability to manage.

In a recent mixed methods study, researchers asked school educators


and administrators to create and rank characteristics of leadership
talent. The results of the study indicated that the 429 respondents
selected characteristics, which were soft skills such as people skills,
vision, enthusiasm, initiative and high energy. The job-related skills
such as experienced project leader, competent educator, and effective
educator were all ranked in the lowest 40 percentile of the list of
leadership talent characteristics. A possible explanation of these
results is that talent is difficult to manage because it does not appear
to be chiefly a job-related skill. Instead, talent seems to favor soft
skills, which require nurturing and an opportunity to manifest.
Therefore, talent may require more nurturing and less managing.

Talent Operationally Defined

Before one can effectively manage talent, a discussion must ensue


regarding the nature and purpose of the organization as well as the
need for talented groups of people and individuals. This discussion
may act as a precursor to many conversations throughout the life of a
manager of talented individuals—as he goes about his everyday
business of talent management. By the use of this term talent
management would it suggest that only some organizations require
talented people in order to effectively conduct their business? The
term talent management appears to suggest that some organizations
do not view the need for their employees to be talented— or perhaps
some organizations require talented individuals while others do not. It
is suggested that one of the characteristics of people in general is they
are often talented and creative anyway; and often over-management
may stifle this talent.

Before one can adequately discuss this construct of managing talent, it


must be stated that any organizational manager should operationally
define the construct of talent and its management. It is suggested that
before talent may be managed in the approved manner, the reasons
for employing talented individuals must be examined as well as the
most appropriate management approach. It is incumbent upon the
leaders and managers of organizations to examine what talent actually
means to the organization; and to attempt to manage this talent in a
manner that will allow for creative and innovative environments. It is
also suggested for organizational leaders to think about their product
or service from the perspective of creating environments conducive to
creativity and innovation. In essence, they must ascertain the what,
why and how questions those are pertinent to the mission and vision of
the organization. Additionally, when one considers the people of an
organization from a management perspective, they will very often tell
managers the type of support and environments that are conducive to
their personal, cognized goals and how they commingle with the goals
and aspirations of the organization.

From the outset of this endeavor, it has been pointed out that many
organizations require talented and creative individuals and groups—in
essence, the management of talent may range through several styles
and appropriate models of management. It is suggested that managers
should perhaps alter their perspectives from managing talent to
facilitating environments where creativity and leadership abound
throughout the organization.

Leadership vs. Management

If one considers the caveats mentioned above, a posture of nurturing


talent may replace managing talent throughout the organization. One
must ask the question if talent needs to be managed (and what this
actually entails); or if talent should be nurtured in order to accomplish
the commingled goals of the individual and the organization as a
whole. Bennis (1999) suggests that "managing people is like herding
cats". He also opines, "Leadership is all about innovating and initiating.
Management is about copying and managing the status quo.
Leadership is creative, adaptive and agile. Leadership looks at the
horizon, not just at the bottom line. A leader does the right things,
which implies a goal, a direction, an objective, a vision, a dream, a
path, a reach. Lots of people spend their lives climbing a ladder—and
then they get to the top of the wrong wall. Most losing organizations
are over managed and underled. Their' managers accomplish the
wrong things beautifully and efficiently. ! They climb the wrong wall.
Managing is about efficiency. Leading is about effectiveness. Managing
is about how. Leading is about what and why. Managing is about
systems, controls, procedures, policies, structure. Leadership is about
trust—about people.

When one considers leadership instead of managing talent there are


several caveats that must be discussed, including the environments
that support and I nurture creativity instead of those environments
that force one to be creative and innovative. This may appear to be a
basic suggestion but it is very often the case where individuals or
groups of people are forced to be creative. As mentioned above by
Professor Bennis, leadership or leading people through situations that
require talented outcomes can prove to be beneficial for all concerned.
If one examines the environments that support and nurture talent and
creativity, one may deduce that environments where relationships are
paramount provide excellent opportunities for creative energies to
thrive.

Creating Environments Conducive to Creativity

If one may suggest that creativity is a paramount consideration related


to talent—one should consider the environments that are conducive to
creativity and innovation. As mentioned previously, if one is forced to
be innovative and creative it may very often stifle the environments
that support these constructs—if one is punished for mistakes, it can
also suppress creativity and innovation. As an example, if the relations
between the leaders (or managers) and the employees of the
organization are not based upon trust, it may be difficult to create the
appropriate environments conducive to creativity and innovation. From
the outset, it must be determined what type of talent is required by the
organization; then a relationship of trust must be established between
all the people concerned within an organization. This trust must be
founded upon a support network where the emerging and current
talent pools of people within the organization believe they will be
adequately supported by their managers or leaders. By this it is
suggested that the people of the organization should believe that the
managers and leaders of the organization will provide the support and
guidance required for any creative endeavor without reprisal—this
environment may often include the freedom for individuals and groups
to make mistakes during this process of creativity and innovation.

Mistakes as Cleverly Disguised Opportunities

Mistakes and blunders may very often be a root cause of an


inadequate talent pool within an organization. By this it is suggested
that the ability of management or leaders of an organization to accept
and embrace failures could have a profound effect upon the levels of
creativity and talent within the organization. If one thinks about the
environments that are conducive to creativity and innovation, one
must certainly agree that the ability to make mistakes during this
creative process and not fear repercussions from the management is a
paramount concern. If the employees working for an organization fear
punishment for mistakes during the creative process, they will most
certainly opt for the much safer environment, which may not include
being creative and innovative. It is suggested that fostering talent from
a posture of a safe and nurturing environment will enhance creativity
and innovation in the organization.

A Non-Example

A hypothetical example of this scenario is illustrated by the following


story of a person whom we will call Patty (not her real name). Patty
works (formerly) in the accounting department of a global sales
brokerage firm that markets its products to a bevy of countries. The
corporation is truly global in the sense of both world recognition as well
as gross sales figures. The organization employs thousands of people
worldwide; and it prides itself upon the cultural diversity of the
employees. Recently, Patty attended a meeting where the managers
and staff of the accounting departments of several areas of the
organization were tasked to offer some new and innovative strategy
for accomplishing newly-adopted accounting goals. In essence, the
managers and staff were assigned with discovering a new and creative
manner to address some very difficult procedures that needed to be
improved upon.

The meeting opened with the CEO of the organization making it very
clear that there were new and improved methods of conducting the
area of their business; and the people in the room should find a way to
creatively improve this process. It was incumbent upon the people in
the department to find a creative new solution to the problem that had
been nagging the organization for years. He further stated that he did
riot know of a better method of conducting the business but he was
counting upon the people present in the meeting to develop a new and
improved method for addressing the problem as well as a strategy for
implementation within the next few months. It was evident to all the
people present at the meeting that their task was a difficult one, which
could adversely affect all their positions within the organization. The
CEO closed the meeting by stating that he would not be disappointed;
and their jobs depended upon a creative solution to the problem.

Patty was a middle manager within the organization with 12 people


under her supervision—her manager was obviously shaken by the
meeting and abruptly told Patty to tell her team to find a solution...and
find one fast. He exited the meeting by stating that they had better be
creative or their jobs were at stake. During the next several weeks
Patty held meetings with her staff regarding the task of discovering a
creative solution to the problem. During the meetings she noticed that
her former rapport of trust within the group had changed to one of
suspicion, her group members began to distrust the management of
the organization; and the CEO himself. It appeared as though she could
offer her support to the members of her team but they began to lose
trust in her. This scenario began to upset Patty because she always
supported her team members—even when they made mistakes in the
past. Patty viewed mistakes as a part of the learning process and
viewed them as opportunities for learning and eventual success.
Unfortunately, the time-frame set by the CEO (and the comment that
their jobs were on the line) created an environment that management
was not to be trusted; and mistakes were not tolerated.

During the next several months additional meetings were held by the
CEO, the management and the staff of the organization. Patty noticed
that some of the former employees were not present at the meetings;
when anyone asked where someone was, the response was he or she
was no longer with the organization. The talk around the various
offices suggested that some of the people who were not in attendance
had left the organization to work with the competitors; others were
simply fired because they had proposed solutions to the problem that
were viewed as being less than creative or inadequate. The climate of
the organization began to decline tremendously with the perceptions
that being creative and attempting to address the problem would
actually get one fired. The climate that once nurtured creativity and
trust among management and colleagues had become one of distrust
and non-productivity.

During one of the last meetings Patty attended she noticed even more
of her friends and colleagues missing from the meetings—the CEO
closed the meeting by stating that he should fire everyone in the
meeting and start all over again. This comment forced Patty to seek
employment elsewhere—she left a few weeks after that meeting. She
still keeps in touch with several of her former colleagues who say that
the meetings still continue but an adequate solution has not been
presented thus far; and more people are leaving the organization.

This hypothetical example was intended to illustrate the profound


importance of creating environments of trust where creativity and
innovation will flourish. It was also intended to provide an illustration of
how not to manage talent when a particular task is in order. If one
thinks about the actions of the CEO in this scenario, he actually stifled
any creativity that may have produced significant results. In essence,
the CEO attempted to manage the talent within this organization
instead of providing the leadership environments that may have
addressed the problem through creative and innovative solutions. The
hypothetical example may act as a catalyst for managers to think
about the environments they create as they attempt to meet the
needs and goals of their organizations.

Conclusion

Talent management is an elusive construct at best—it is suggested


that organizational leaders should begin to think about the kind of
talent that is required for any given solution to problems and attempt
to recruit the optimal people for the endeavor. Several other caveats
are of paramount concern for managing talent:

• Operationally define the construct of talent (the specific talent


that is required for the organization).

• Ascertain the appropriate management style that will be required


to nurture the talent pool.

• Think about adopting a posture*' nurturing talent through


leadership instead of management
• Create environments conductivity to creativity and innovation.

• Create a safe and trusting, environment where mistakes are


viewed as potential solutions t» problems.

• Never attempt to force creativity (the story where Patty and her
colleagues were tow their jobs depended upon it is an excellent
example).

• Involve the citizens of an| organization (the employees) in


solutions to problems—the employees may often know the;
solutions but they may be afraid-; to convey their thoughts to
the|; management.

• Open the organization to dialog; and include everyone; ask:


people what they think—they I may have a feasible solution.

• Problems may have excellent: potential for successful outcomes I


if dealt with in a creative manner.

• Respect people and treat them as if they were a valuable


commodity to the organization —in fact, they are.

It is suggested that managers of talented people should begin to think


about the relationships and environments that foster creativity j and
innovation. Trust is a paramount concern as well as creating
environments, where mistakes are viewed as part of the process of
creativity; and ostensibly, talent management. Think about not
managing talent in future endeavors but nurturing talent through
leadership behaviors.*

HR leaders worldwide are under intense pressure to align their actions


and investments with business strategies and to demonstrate a
meaningful return on these investments. This ongoing drive to reshape
11R into a valued business partner has led many a IIR professionals to
explore the outsourcing of various I IR functions - from payroll to
employee benefits - as 8 way to better manage costs, streamline
administration increase HR effectiveness and efficiency, free up time
for more strategic activities, and provide enhanced service to I IR's
internal customers.

The reward programs and the compensation function, traditionally an


MR turf make for a significant and growing investment for an

*
Reference # I2M-2008-10-04-01
organization. In general, these programs have been managed
discreetly rather than as part of an overall strategy. As business
leaders look to I IR to support the organization's business objectives
and enhance profitability, the Compensation function within the
broader I IR amhit has a challenging road ahead.

Outsourcing for the compensation function too, had been a different


story so far. Businesses have been larger reluctant to outsource the
compensation and benefits function for a number of reasons. A recent
Mercer survey of more than 300 large US employers revealed that only
4 percent of the respondents outsourced their compensation
administration - the lowest level of outsourcing reported for 12
common HR activities. The figures are similar in most other
geographies around the world. For example, just 3 percent of
employers in Canada, 5 percent in Latin America, 7 percent in Asia,
and 8 percent in Australia currently outsource their compensation
administration, according to Mercer research.

Why the reluctance? First, compensation traditionally has been seen as


a corporate function - less transactional and more strategic than
functions typically associated with outsourcing. Second, compensation
functions serve managers rather than the broader employee
population (as with benefits administration outsourcing, for example).
Companies have been more hesitant to turn these higher-level
interactions over to an outsourcing vendor. Third, the diverse,
specialized skill set needed for compensation work does not fit easily
into the typical outsourcing model. And finally), until recently, the
technological capability for this sort of "co-processing" with an outside
vendor was cost-prohibitive.

The paradigm of change

In times when talent has become the most critical resource, managing
this talent effectively and efficiently is central to a company's growth.
This coupled with the increasing complexity of the HR function has
meant adoption of technology today is not a matter of choice but a
business imperative for the HR function. Hence a move towards
automation and standardization of key functions including
compensation management cannot be overlooked. Traditionally, the
HR department has been slow to embrace technology unlike other
departments like Production, Finance, Marketing, Sales.

6. Customer relations.

Research suggests that on an average, 77 % of company expenses


derive from workforce expenditure. With stakes being so high,
competitive pay analysis has become critical. Pay too little, and
retention, recruiting, morale, and productivity all decline. Pay too
much, and your burgeoning talent costs diminish your margins, a
problem that only compounds over time. Consider this...

• For every $1,000,000 of payroll expense, an overpayment of 2%


costs your organization 520,000 and does little to motivate high-
performing employees to slay

• For every $50,000 of individual payroll expense, an


underpayment of 5 % is enough to send your high performing
employees to the competition, but not enough to motivate
marginal employees to leave

Changes to HR structure and processes create a domino effect - for


better or for worse - throughout the remaining 11R function and even
the organization, and few changes make a greater impact on HR than
outsourcing. That's why outsourcing should always be considered a
transformational event for HR, and why plans for the retained 11R
function should be addressed in conjunction with plans for any
outsourcing effort.

A quick review of market trends reveals that HR outsourcing (HRO) is


growing, global and continually extending to a wider range of HR
functions. After some market slowing in 2006 - 2007, Everest Research
expects I IRQ to reach an annualised contract value of US$3.5 billion in
2008. In addition, current contracts worth nearly $1.1 billion arc due
for renegotiation and renewal in 2008. Furthermore, HRO In Europe
should continue to grow faster than in North America. On a global
level, organizations are struggling with the challenges and implications
of global business expansion. The HR function must reassess how it
functions and supports the business and how it delivers services across
geographic boundaries. Global organizations are at the forefront of
evaluating all areas of HR as potential candidates to either outsource
or cosource in order to meet their organizations' needs.

True global HR business process outsourcing (BPO) - that is, total


benefits outsourcing plus payroll, recruiting, employee data
management, engagement, retention, the employee value proposition
and more, all on a seamless worldwide basis - is still in its infancy. Big
deals are done by big companies, and scale is a necessity. The model
today requires adaptation, in which the company adjusts to the
vendor's model or the provider is willing to customise. Both parties
face multiple challenges. For example, the administrative complexities
involved in providing global payroll administration alone are daunting.
Not surprisingly, few vendors are currently offering services at this
level. As total HR BPO evolves, providers may first become
administrators of niche services for global clients, who prefer to
consolidate with a single supplier than rind and manage multiple
vendors.

The 'right' adoption of a 'right-fit' technology can help do just that, and
if that technology promises to accomplish more than just outsourcing -
even better.

Promise of co-sourcing through technology

A promising new alternative to tactical outsourcing or inadequate


internal compensation management function is emerging -
compensation co-sourcing. Co-sourcing differs fundamentally from
outsourcing of the compensation function. With outsourcing, employers
shift discrete, straightforward transactional and administrative tasks
from HR's to-do list to an outside vendor able to accomplish those
tasks more efficiently Outsourcing goals are simple: to save money, to
save time, and to improve service.

Co-sourcing's goal is more ambitious: to create a more robust and


efficient compensation function - within a single country, regionally, or
across the globe - by partnering with a service provider able to
augmentf internal resources in whatever way is needed. Companies!!
that form co-sourcing partnerships can rely on their^ partners'
expertise and resources as a supplement, or complement for their
internal staff. Unlike outsourcing,! which would simply move a task or
process out of the] organization, co-sourcing brings in additional
resources! that can be applied flexibly across the full spectrum off the
compensation function's responsibilities aided byj? technology to
include transactions, analysis and strategic! design. It helps
organizations achieve the right balance' of control and delegation in
this important function.

Co-sourcing focuses on getting the most from available and sometimes


limited resources. And it can help compensation professionals play a
more central and strategic role in critical people issues while
contributing more appreciably to the organization's overall success.

Compensation management technology in context

It is in this context, the need for technology and a compensation


management tool gains importance. Aj critical component to the
success of the compensation function - and the one demanding the
most specialized skills - is developing and maintaining fully functional,:
appropriate compensation management software. It also
CHALLENGES FOR COMPENSATION PROFESSIONALS

needs to address the above challenges to make the compensation


function truly business oriented. A service provider could configure
technology tools either through the web or through the organizations'
own IT infrastructure, thereby allowing organizations to leverage and
optimize resources.

Compensation Management tools such as Mercer's ePRISM™ allow


companies to store and access all internal job and employee data, as
well as all external compensation market information - facilitating
tasks such as annual salary review, market pricing, job evaluation,
data analysis, and management reporting. Self-service decision
support tools such as these let managers throughout the organization
and not just within the IIR function make decisions about merit
increases, bonus payouts, equity adjustments, and promotion
increases more effectively and efficiently, freeing compensation staff
to focus on more value-added design activities.

Ideally these tools should go beyond simple database management


and become an aid to business decision making. Leveraging the
technology thus, service providers can become a part of a seamless
extension of the compensation program delivery team and do not
remain a 'outsourced vendor' any longer.

Impact: efficiency, effectiveness, and innovation

The right technology integrates the human resources information


system and the compensation management tool to provide a
comprehensive compensation technology solution to define a strategic
compensation policy through out an organization. This enables the HR
and compensation professionals to track, monitor, plan, simulate, and
execute that strategy effectively and efficiently.

Using a compensation management tool, the MR professionals can


assess pay equity and competitiveness across the organization, within
a business line, a job family, or by a specific job or employee. They can
identify and address at-risk areas such as below market, high
performing. employees, model distribution of base pay and ' total cash
to ensure proper mix, analyze the impact of salary and range
adjustments for; business planning, examine changes to pay plans and
streamline their implementation, build al single database for
compensation management worldwide and administer multiple pay
practices.

The impact of compensation management technology is enterprise


wide and transformational. It brings in efficiency effectiveness and
innovation through better management of compensation expense, few
resources, increased precision of calculation more focused market
analysis, quicker II response to internal requests, and leverage be
practices across the organization.
The plummeting economy has set the atmosphere of constant pressure
on HR professionals. Prom aggressive recruitment and retention to
handing over pink slips to their colleagues and subordinates, HR
executives are juggling with their own emotions while communicating
the company's decision.

Facing employees who are already nervous and angry about losing thei
r jobs is not an easy situation. But what really irks HR managers is the
pain of conveying management's decision, that too, gently and
rationally. Walking the fine line while talking to co-workers and friends,
some try to imagine what it would be like to be in the opposite
person's shoes and how it would feel, affirms psychotherapist Meera
I'andya. "In many cases, HR professionals tend to see laid off
employees as victims. Some even experience the survivor's guilt." Her
advice to survive the emotional roller-coaster ride, guilt, inner conflicts
and handle this stomach-churning challenge: simply acknowledge that
you are sorry and offer support where you can. In the situation of
dealing with a close associate's emotions of dismissal, one has to be
careful and avoid being self-conscious" she believes.

Corporate India still believes that job elimination is unethical. There is


still a social stigma attached to being laid off, even though
innumerable people across industries have experienced involuntary
exits first hand. Kmployees continue to react more adversely to layoffs
in comparison to the U.S. where employees absorb the news prior to
taking the next action. A latest research conducted by Watson Wyatt
Worldwide Inc. revealed that 39% of U.S. companies have gone
through employee layoffs; 23% expect to do so during the next f2
months; 23% have undergone a company-wide restructuring; and
another 14% foresee the need for future downsizing and layoffs.
According to HR consultants if the economic slump continues, India
could experience layoffs at the same level as U.S. Considering the
economic instability results Indian IIR pros need to accept reality and
get used to layoffs effectively with a stress-conflict-free mind.

Communicating pink slip decisions

Breaking bad news to employees about job cuts because of an


economic downturn naturally springs shock waves, creates a state of
denial, frustration, anger, blame, and depression, and the one at the
receiving end is typically the HR functionary. "It is indeed a difficult
task to ask anyemployee to leave the organization," affirms Tasnim
Nulwalla, Head-Human Resources, Timezone Entertainment Pvt. Ltd.

Besides, giving pink slips to any employee is a management call and


as part of management team HR pros have to go with the decision.
SECOND INNINGS
By Prof. K. Kunikrishnan & Dr. Sandeep Krishnan

What would a Sachin Tendulkar or a David Beckham do after retiring


from a sports career? Options are many. They will be a coach, a
selector, do commentary, start their own business or involve fulltime in
an already existing one, venture into the entertainment world. While
retirement of a sports person is driven by factors like age, inability to
take stress of sports after an age, and is purely driven by inability to
consistently show form in playing, the phasing out of a professional is
quick and abrupt driven by the age factor of retirement. The growth of
knowledge professionals has created a different perspective to this
outlook. Is a healthy professor (may be one of the best) not suitable to
teach just as he reaches the age of 60? Is a great scientist no longer
able to contribute to an institution or nation after the age of 65? Or
simply put, is a competent I1R professional no longer required in his
profession?

Exploring The Scenario

The current generation that is going to retire at the age of 60 would


have joined the work force during the early 70s. We set policies of
employment based on considerations of creating jobs, job security, and
opportunities for young people. Also imagine the management
scenario. People just got promoted by years of service. No words like
succession planning and career management had many takers or
need. Public sector dominated the scene as well. However, as a whole
it created a great set of people who were ready to expand the horizon
with the opening up of the economy, information revolution, and
increased need of professionals. Many of them rechristened quickly to
the new roles.

A new challenge arises as these professionals reach the retirement


age. Early management professionals, seasoned leaders,
academicians, and many more professional experts who have seen the
times of the License Raj, as well as new age industries are suddenly
facing the challenge of finding avenues for canalizing their talent to
productive purposes.

Managing the transition

A retirement has many more dimensions rather just cessation of a


regular job. Quite clearly, for an individual this is the time of quick
change, especially for those who are at the peak of their careers and
power status. It is a time of confusion, uncertainty, and definitely
planning. One of the choices is to pursue purely life-related aspects
and have an understanding of moving away from the professional
realm. Ibis entails time for second innings

oneself, one's family and social activities. Many choose to do this and
look forward to the same, while sacrificing professional competence.

On the other hand, studies in the west show that as many as 70%
people would like to continue in some profession or another to keep
them busy. Many even wish that their regular job continues. In an
Indian urban context, this can also be a bigger challenge with the
nuclear families setting in and difficulty to connect regularly with near
and dear ones. The opportunity and challenge here is the scope of re-
engaging in any form professional engagement. Many options exist for
a professional after retirement. However, a lot depends on the
preparations that enable the transition and life attitude and
perceptions. Psychologically, retirement is one phase in the
occupation, which would lead either to personal satisfaction and self
fulfillment with contribution to organization, society, family and self or
job discontentment, sense of low self worth, and negative outlook to
organization and society. This ultimately leads to positive or negative
orientation to life. Either way it reflects the life cycle and the options
possible for post-retirement life. The happiness one feels or the
attitude towards others would largely depend on the outcome when
one retires from the career. The positively oriented may go for better
options whereas the frustrated and negatively oriented would opt out
and insulate.

LIFE ASPECTS

• More time for oneself and with the family

• Plans for exploring various hobbies

• Engaging in more social roles

• Rest and relaxation

• Spiritual pursuits

• Developing social networks

• Catching up with friends, and relatives

• Health management
PROFESSIONAL ASPECTS

• Moving out of operational roles

• Regular salary income might cease

• Power status with designation and roles might cease feeling of


frustration of lack of channels to express one's talent and
knowledge or freedom from job demands

• Moving out of regular professional networks

• Continuing professional credibility

• Developing different equations with the professional networks

• Sudden feeling of more time and less productivity

Devanathan, 68 years old now, is excited about the balance that he


has in personal and professional life. Retired close to 8 years back, the
transition was not so tough for Devanathan. A mechanical engineer by
profession, Devanathan had worked in various capacities with Tata
Steel. While he was heading maintenance for Tata Steel, one of the
vendors of Tata Steel, GE, was interested in getting help from
Devanathan in understanding their client needs and better. While with
GE, he was complimenting the chemical engineers to have a better
understanding of Tata Steel's operations. Soon Devanathan was
contacting many other clients of GE in specific areas of mechanical
engineering operations. This also got him in touch with JSW steel
where they wanted him to be a consultant on a more continuous basis.
That made it easier for Devanathan move to JSW steel as an advisor.
As he himself puts it, "These assignments made me a pure
professional. 1 could voice the opinion to the best of my knowledge.
Also my suggestions getting accepted and not accepted are also
learning. I no longer have any worries regarding formal designations or
higher compensation."

The next move was much more interesting for him. He took up a role
with a small company which was planning to set up a plant as a joint
venture with a German steel plant equipment supplier. This called for a
more focused approach from his side and he agreed to work for them,
mostly from home. He set up his own office at home and conducted a
series of planned meetings with the clients. Some of the key
challenges that Devanathan had to face in his second career were
EMPLOYEE RETENTION
A Major Concern to Organizations

Emerging trends in today's fast-changing corporations are 'pointing


urgently to the need that business and human performance experts
must address not only survival and security needs, but also the higher-
level needs for respect, recognition, achievement, and life-long
learning. These workplace motivators and satisfiers are potent
determinants of retention.

Retention is one of the important aspects of an organization. The


subject retention deals about identification of human behavior and in-
dicate their personnel feeling, it is a process in which the employees
are encouraged to remain with the organization for the maximum
period of time or until the completion of the project. A good employer
knows how to attract and retain his employees. This is one of the
hottest topics for corporate leaders of all fields in India and across the
world.

Some organizations are on the top because they value their employees
and know how to keep them glued to the organization. Whatever the
reason, personal or professional, the employers should take care of
employees. If they don't, they could be left without enough good em-
ployees. The supervisors must be prepared to be collaborative, sup-
portive, and nurturing their people. The "my-way-or-the-highway" style
of management is a thing of the past. Employee retention involves
being sensitive to people's needs and demonstrating the various
strategies, as told in Roger

Herman's classic book on employee retention. The environment, rela-


tionship, support, growth and compensation are the various measures
to be taken to encourage employees to remain with the organization
for the maximum period of time.

All the companies are planning to increase their turn over every
moment of time. While in all this workout of increasing the turnover,
they forget about their loss incurred by the resignation ot employees
and the expenses of hiring new employees (Hiring cost, Training Cost,
Productivity Loss, etc.). This hiring of a new employee normally costs
around 35% or more of the average employee salary.

For example, an average salary of an employee per month is Rs.


20,000 and then the cost of hiring a new employee and other expenses
come around Rs. 7,000. If you have two employees resigning per
month, the cost comes to Rs. 14,000 and taking the same for 12
months to around Rs. 1,68,000 which is a direct loss from the turnover
of the company. And after all this, there is a risk of getting a right
employee for the right position with a right attitude.

The Seven Hidden Reasons Why Employees Leave

Nearly 90% of the bosses think their employees quit making more
money, but 90% of the bosses are wrong. Ask HR people about their
top issue these days, and it's likely to be retention. That's no surprise.
The cost in dollars and disruption of replacing a trained employee is
enormous. What is surprising is how many employers misunderstand
why their people leave. At a recent SHRM conference the misunder-
standing is evident in one astonishing statistical comparison:

The study identified the following seven "real" reasons why employees
leave.

• Job not as expected.

• Job doesn't fit talents and interests.

• Little or no feedback/coaching.

• No hope tor career growth.

• Feel devalued and unrecognized.

• Feel overworked and stressed out.

• Lack of trust or confidence in leaders.

Overview of Retention Strategies

Retaining valuable staff is becoming increasingly difficult in today's


environment. Global Hunt proudly talks about its retention policy, 80%
of the companies are proactively planning and practicing to improve
the employee retention rate by themselves or with the help of spe-
cialized skills and knowledge personals who walk through their doors
every morning, and walk out every night. The following
recommendations have been considered for retaining valuable
employee:

Get the Right People at the Right Time


It sounds obvious, but, in reality, many companies first neglect this
crucial step. One way to cut turnover is to hire the right people the first
time around. Start with a thorough and realistic analysis of what the
different roles in your organization truly require with regard to
Knowledge, Skills and Abilities (KSAs).

Give Attention to Every Employee

Recent research in the area of transformational leadership indicates


that effective leaders provide their employees with individualized
considertion, eschewing a "one-size-fits-all" approach to employee
motivation and instead providing each employee with unique
guidance. Top performers are less likely to flee if they feel that they
are truly valued as individuals.

Training and Coaching

There is a direct link between training and employee retention. Em-


ployees involved in ongoing training feel that their employer is inter-
ested in them doing a better job, and the employer cares enough
about them to make an investment. Training can also be the means for
positive change in any organization. It, however, creates a vital link
that will help your employees transfer what they learned in real-life.
That vital link is a strong coaching program.

Plan for Succession and Acceleration Pool

Companies need to identify, track and develop key individuals so that


they may eventually assume top-level positions. This is required not
only for forecasted vacant positions, but also to develop a group of
high potential candidates for undefined executive jobs and focus on
increasing their skills and knowledge rather than targeting one or two
people for each senior management position.

Offer Better Career Visibility

Current and prospective employees need a clear vision of their career


potential. According to the American Institute of Certified Public
Accountants (AICPA's) Private Companies Practice Session 2006 Top
Talent Study, 80% of the young professionals said that growth op-
portunities are the primary reasons why they join firm.

Use Explicit Ranking Systems Tied to Incentives

An individualized approach to development enhances career satisfac-


tion of top performers and increases the likelihood that they will stay
with the firm.
Differentiate Your Organization

This can seem tough at first, but remember that every company's cul-
ture is different. Organizations should take steps to make the em-
ployees feel proud of their employer.

Techniques

Using Retention Bonus as a Tool

According to a survey, non-management employees, generally, receive


about 10% of their annual salaries in bonuses, while management and
top-level supervisors earn an additional 50% of their annual salaries.
While bonuses based on salary percentages are the generally used,
some companies choose to pay a flat ' figure. In some companies,
bonus ranges from 25% to 50% of annual s:' 1 "i'y, depending on
position, tenth . and other factors. Employees are chosen for retention
bonuses based on their contributions to management and the
generation erf revenue. Retention bonus generally varies from position
to position and is paid in one lump sum at the time of termination.
However, some companies pay in installments as on when the
business cycle completes. A retention period can run somewhere
between six months to three years. It can also run for a particular
project. For example, the implementation of a system may take 18
months, so a retention bonus will be offered after 20 months.

Although retention bonuses are becoming more common everywhere,


some industries are more likely than others to offer them. Re-
tail/wholesale companies are the most appropriate to implement stay-
pay bonuses, followed by financial service providers and manufac-
turing firms. Companies of all sizes use retention bonus plans to retain
knowledge employees with the company.

Rewards as a Strategy for Retaining Workers

From the organization perspective, rewards help attract and retain em-
ployees, facilitate satisfaction. Good compensation plan within the con-
text of a total rewards system in organization provides a method for
retaining the individuals who are talent. In order to retain the workers
performance-based rewards should be encouraged instead of seniority
for the best performers.

Every agency today is aware of the need to manage compensation


costs. The challenge, however, is to make sure employees are paid
competitive wages. Finding sources of salary information, conducting
your own salary surveys or sharing information with a group of
competitors can help retain employees who might leave because they
are underpaid. Without accurate survey data, agency owners risk
overpaying or underpaying employees. Many agencies are adapting a
pay for performance compensation system, which rewards employees
for achieving results related to the agency's business goals. An
agency's compensation plan should connect employee performance to
overall business goals.

But employees also value rewards that are not monetary. Surveys con-
ducted by the Society of Human Resources Management indicated that
employees ranked high, given training and advancement opportunities
as top factors influencing their decision to change jobs.

Offering perks can also be a cost-effective way to attract and retain


employees. For example, casual dress, flexible starting times, earning
time-off (comp days, floating holidays or summer hours), job sharing,
or using part-time positions provide the agency with a powerful
advantage in the job market.

Training as a Retention Tool

There is a good fit between training and other retention practices such
as career development, planning skill-based pay and others. Training
can be particularly strong retention tool when it is combined with mea-
sures designed to allow people to develop and progress within a com-
pany. Thus training when combined with well communicated plans for
advancement and ongoing professional's development within the
company can help companies keep their valued employees. Fur-
thermore evidence seems to confirm that the link between the training
and retention is stronger for highly skilled workers.

HR Manager's Role in Workforce Retention

For a company, the workforce is like an intellectual property, both in


terms of skills and money. A trained and content workforce can lead a
company to new heights while an opposite once can hamper it badly.
So every resignation saved is every dollar earned. The change in the
nature of workforce has brought up more, not fewer retention issues.
Dearth of skilled and professional employees, forecasted labor
shortages as a result of nearing retirement age of baby boomers
changing expectations of new workforce, lack of stability in terms of
jumping form one organization to another, workforce diversity,
globalization have contributed to attrition rate. Another reason for the
organizations to retain their empl°yees atld curb employee turnover is
the cost attached to it. Fitz-Enz (1997) stated that the average
company loses approximately $1 mn with every employee who leaves
the organization. Over two-thirds (70%) of HR managers say worker re-
tention is a primary concern and 40% report that turnover has
increased in the past 12 months. If employee retention is a current
business challenge, long-term demographic trends are sobering.

Table: Development Practices Across Personal Variable 1


Demograp Age M F Martial Academic Mea
hic Status Qualificatio n
Variables n
Factors 1 2 3 M U NG G PG
M
Opportuniti 3.6 3.6 3.6 3.6 3.7 3.6 3.6 3.2 3.7 3.6 3.64
es for skill 6 9 5 3 5 6 8 8 6 6
enhanceme
nt
Availability 3.7 3.6 3.8 3.7 3.6 3.5 3.8 3.4 3.6 3.8 3.69
of 1 3 6 4 4 9 2 1 7 1
challenging
assignment
s
Effective 3.0 3.1 3,1 3.1 3.0 3.1 3.1 3.7 2.9 3.1 3.18
and 5 9 5 7 5 0 5 9 6 8
motivationa
l leadership
Access to IT 3.5 3.6 3.6 3.5 3.5 3.4 3.6 3.4 3.4 3.7 3.57
specific 0 1 8 9 6 6 9 2 7 5
Training
Career 3.3 3.5 3.4 3.4 3.4 3.6 3.3 3.2 3.5 3.4 3.45
advanceme 7 2 8 6 9 0 4 6 3 5
nt
opportunity
within the
organization
Cross 3.6 3.5 3.3 3.4 3.6 3.6 3.3 3.9 3.3 3.6 3.55
Training 1 4 0 6 5 7 9 3 8 2
Career 3.G 3.5 3.7 3.5 3.6 3.7 3.4 3.6 3.7 3.3 3.60
Planning 0 4 1 8 2 0 9 4 8 6
Initiatives
by
organization
Note: 1=20-24 years age, 2=25-29 years age, 3=30 years and above
M=Male, F=Female, m=married, um=unmarried, NG= Non-Graduate,
G=Graduate, PG = Post Graduate.
Source: The Journal of Amity Business School, January-June 2008 Title
“Organizational Employee Development initiatives and Their impact, on
Retentions intensions: The Case of Indian IT Industry.”
According to retention strategies for 2006 by Monster Inc., an online
career and recruitment source, 55% of HR managers expect workforce
retention to be a high challenge for their organizations in the next five
years. Other key findings are:

• HR managers expect a disproportionate number of workers to


reach retirement age in the next 10 years.

• HR departments are using a variety of methods to monitor


worker sentiment, but most managers report that little or-
ganizational change results from information gathered.

• While HR managers regard turnover as a concern, a few have de-


tailed understanding of its true organizational cost.

Over the 50 years between 1950 and 2000, the US workforce added 79
million workers, according to the US Bureau of Labor Statistics. In
contrast, between 2000 and 2050, American businesses are expected
to face a decrease in the available workforce. This is due, in part, to a
proportionately smaller generation of talent replacing baby boomers
who are retiring or transitioning to part-time roles.

One possible scenario is an expanding economy constrained by a


slower growing workforce. This could produce excess demand for
talented workers and drive up recruiting costs.

Major Findings and Discussions

Employee retention is the call of the day and is a fast emerging area
for human resource management, to develop the knowledge, skills,
aptitudes and values of the employees so that they can perform the
present and future job more effectively. The data collected by the HR
regarding the attitude of the respondents in various development
practices and their involvement in employee retention was later
analyzed on the basis of personal and positional demographic variable.
The personal variables include the respondent age, gender, marital
status and academic qualification where as the positional variables
cover hierarchical position, work experience as shown in Table.

Conclusion

The globalization of business is forcing the managers to retain high po-


tential talents and develop them to be the best workers. The major
challenge for managers and HR leaders is to convert threats into
opportunities effectively via best available resources in order to recruit
and retain them in the organization. Besides this, pursue succession
planning and enable a workplace where employee's expectations are
viewed clearly. Create an employment brand experience that
motivates and energizes employees and can be used to attract new
talent. What is important is to develop an understanding of what will
keep employees glued to the organization and if done successfully,
those employees have always proved to be fruitful across many
industries rather than to search for new efficient talent. Companies
need to identify the routes to ensure employees feel they are growing
with the industry and are not being exploited for a few bucks.*

STAFFING OUTSIDE CITIES:


Predicting success from failure!
By Gautam Brahma

With the current slowdown showing no signs of ending early,


companies are looking at new markets, new offerings and new
business models to grow, or at least retain, revenues and profits. In
India, many companies are looking at the rural market for their
products and services. In many cases this has meant tweaking their
offerings to reduce price and maintenance. This is no easy task and not
always possible for every kind of product and service. Equally
importantly, the focus on rural markets has led to a search for
agencies which can help entry, brand creation and communications in
a territory not very familiar to most companies. This has provided a
boost to a very different and specialized set of service companies. This
is an interesting phenomenon which merits detailed study. In parallel
with all this, companies are trying to extend their own organizational
presence in small towns and large villages and it is here that their HR
functions are coming up with challenges.

Staff from cities is reluctant to relocate to rural and semi-urban areas,


liven where diminishing job opportunities compel people to accept
relocation, they are not really effective in their new surroundings as
their competence has been established in a very different
environment. They are often clueless regarding what they should do to
accomplish the goals they readily met in urban and metro settings.
Even in those rare cases where companies find people within their
ranks who are both willing to relocate and are effective in rural
locations, the high salaries such staff currently enjoy makes the new
assignment unattractive for the company where margins are
concerned. While such high costs can be borne in the short run,
eventually the need for rural organizational structures will have to be

*
Reference # 12M-2009-04-13-01
met through fresh hiring and creation of an alternate cadre operating
on a lower cost base.

Creating such alternate structures is always a challenge for the MR


function. Staff usually expects similar pay, perks and conveniences for
similar work, and resentment can build up quickly as new hires
discover anomalies. While the tight job market may limit over
expression of this resentment it cannot be good for employee
productivity and retention. More importantly, where are the HR
managers going to find their newt staff for the extended organization?
The traditional p hiring channels that they are familiar with are not up
to the task and do not have effective counterparts outside cities and
metros. Companies often resort to word off mouth references for hiring
in these new markets but I that limits choice. Besides word-of-mouth
works best when a critical mass in terms of presence has been
established in the new territories i.e. when one has enough employees
and partners operating for a long enough period to discriminate
between good and average performers so that one can rely on
references received from good performers.

There are some positive developments to help the function here.


Specialist agencies are developing to meet staffing needs in rural
areas. One such agency which is getting a lot of attention is
ruralnaukri.com. It puts organizations in touch with potential executive
hires who have the right qualifications, experience and inclination to
work outside cities. In a recent interview the founder- entrepreneur
shared an impressive list of non-profit and for-profit clients using his
services. The promoters have created a parallel organization called
villagenaukri.com to address staffing for non-executive positions and
have tied up with a large number of NGOs of train people in villages to
become eligible candidates J for employment. My hunch is that we will
see more and | more such services being provided across the country
by organizations with specific regional or sectoral focus! e.g.
healthcare. Eventually there may be unique bottom-of-the-pyramid
opportunities for IIR outsourcing in rural markets but I think they are
still a few years in the future.

Not all companies will do a good job of penetrating these new markets.
However it is a little early to say who will do well and who will not. In
fact those who appear to do badly at the start may end up doing very
well. If this sounds paradoxical this is just a cue to share an interesting
finding written up by two professors from (current/past), using InMail,
purchasing advertising, and networking, this MR executive filled jobs
from sales to executive level roles using Linked In.

• Employer branding through SNS provides a platform to leverage


intangible values of the organisation to improve retention,
employee satisfaction and performance.

• Online bulletin boards provide a twist to corporate discussion


forums... leading them from niche to mainstream, removing the
facade of a recruitment brochure.

• Key ex-employees can be brought back.

• SNS can be utilized for recognizing in-house and external


prospects through contests.

• It also helps in internal redeployment.

• Provides organizations with options of group hiring.

• Aids in succession planning... like replacing retirees, succession


planning metrics, adding external candidates, and fast-track
leadership development.

• Employee blogs for answering candidate questions thereby


making the organization emerge as more real and approachable.

• Evaluates candidates in behavioral attributes with social


interaction.

• Provides reliability to a professional's profile with the referrals


and recommendations on the person.

• Increases contacts.

• Locates passive candidates methodically.

• It's economical... most sites are free

• Can reach job seekers 24/7, provides an easy and informal way
of communicating with them.

Another firm, DB Search Group, a Minneapolis staffing and recruiting


company used Linkedln to connect with many hard-to-find
professionals. They filled a Senior Director of MR position through
Linkedln by posting the position and then viewing potential candidates
through second and third party connections via immediate contacts
and introduction.

Serena Software in California had a policy for locking things down...it


went through a cultural shift and replaced it by Facebook chatter. All
employees including the CRO uses the social-network site to hang out
with fellow workers, access internal communications, or interact with
its Sydney branch. Serena's management created a Facebook
Friday...an afternoon training session by Facebook experts on teenage
sons and daughters for social interaction inside the organization.
Serena uses Facebook as its intranet. The company also uses social
networks to employ new people.

Organizations like Oracle, SAP, and Microsoft make use of Linkedln for
their FIR and recruiting functions. Indian companies like Sapient,
Electronic Arts, and Wipro post jobs on Linkedln.

India, too, has become pro in utilizing SNSs to identify candidates.


Sulekha.com, a popular Indian social networking site offers employers
the prospect to tap candidates in non-IT category like content writers.

Upcoming trends

A unique trend is happening at a publishing company, Informa. Its


group head of FIR is making career planning a more engaging
experience for the company's 10,000-strong headcount through
Second Life. The company has created its own, private zone in the
online virtual world that Informa employees can visit to access
information about job functions, competencies and skills gaps.
Employees develop their own 'avatar' - an online representation of
themselves that can 'teleport' into (hat zone called the 'Transformed
Careers Island'. In this zone, each building represents a function within
Informa - for example, sales or editorial. Once inside a building, (hey
can view the 'day in the life' of the ambassador for that function, read
and save the competencies required for those roles, and see what
training or experience gaps they have in meeting the competencies for
the role they want to move to. They can also chat to the ambassadors
who man each building, and view internal job vacancies in all of the
global Informa businesses.

A new social networking feature (racks HR and benefits bloggers.


Media companies looking for resources can now join a conversation
with a writer, editor or analyst. This feature covers.. .getting to know
the writer/ editor, read their work, comment on their work via email,
their blogs, webcasts, etc., suggest story ideas and/or introduce clients
who may be a resource. **
**
(Web References: Social Network Sites: Definition, History, and
Scholarship by Danah M. Boyd & Nicole B. Ellison onJcmc.indiana.edu,
Online and off the wall by Liz Ford on Guardian.co.uk, HR organisations
must adopt social networking by Gartner on Bizcommunity.com, 13
Trends In Corporate Recruiting for 2009 by Dr. John Sullivan on
Credibility/privacy of information on SNS is a concern.

Passive headhunting through SNSs can be time consuming till sourcing


patterns become familiar.

Possibilities of pointed searches may not be possible or do not give


desired results.

Recruiters going through candidates' SNS profiles for information on


their background are sometimes unimpressed with what they find...like
rude comments or unsuitable photographs...without realizing that the
attitude of candidates is laid back on SNSs.

Utilizing SNSs to find or research applicants has some amount of


uncertain legal-risk with every search, started to have photo-sharing or
video-sharing abilities; others had built-in blogging and instant
messaging technology like Dodgeball, a mobile-specific site. Many
SNSs targeted people from specific geographical regions or linguistic
groups...for instance Orkut, a U.S. based site had English-only
interface. Some sites are created for ethnic, religious, political or in any
other category.

Current significance

SNSs such as MySpace, Facebook, Cyworkl, and Bebo have fascinated


millions of users who used them on a daily basis. Apart from these,
hundreds of other SNSs with different technical affordances, supporting
an extensive array of interests and practices are also rooting their way
up.

Job advertising has infiltrated Web 2.0 and employers/ recruiters are
employing this part of cyberspace in a bid to recruit staff. For example,

Ere.net, Social Media for HR on Techgazing.com, Social Networking


with HR Media and Analysts on Hrmarketer.blogspot.com, Social
Networking Sites: Your New HR Recruiting Tool? from
HRTechNews.com on blog.softwaretech.com, HR staff use Facebook
and MySpace to find out what employees get up to by David Woods on
humanresourcesmagazine.com. Using Linkedln for Recruiting on
about.com, Using Web 2.0 technologies: talking about my second
generation by Jessica Twentyman on Personneltoday.com, Companies
warm up to social networks by Stephen Humphries on Csmonitor.com.
Using social networking sites for hiring by Vinit Gupta on
Expresscomputeronline.com, Techrepublic.com, Beyond Facebook by
Scott Westcott on hreonlinecom)
Yell, creator of Yellow Pages is using this virtual world to run a real-life
recruitment campaign. It uses a group of avatars (digital characters)
dressed in yellow T-shirts, who hang around a virtual phone box
enclosing links and information about careers at Yell. More than 300
guests visited the Yell website through the Second Fife phone boxes in
the first 24 hours of opening.

SNSs have become like a second life. With Facebook and MySpace
bookmarked on computers worldwide, recruiters have turned to this
virtual world to tap candidates and market their organization in an
innovative way.

SNSs are utilized extensively as a HB tool in the U.S. .& UK, especially
to host virtual careers fairs. Social software is changing the
recruitment setting and becoming accustomed to recruiting strategics
and systems accordingly. Gartner analysts predict that "by 2011,
organizations that do not manage their employer brands effectively
will fail to attract key talent".

"Companies across Asia are increasingly adopting employment


branding this year," informs Dr. John Sullivan. For example, he adds,
"Google, world's strongest employment brand, focuses on media
coverage and online visibility through which it is able to attract people
i'r to see it as an employer to work for"

HR strategies

SNS usually attracts the age group of early 20s to mid I 30s... including
candidates looking for middle management positions covering
candidates across industries like IT, manufacturing, marketing,
communication and more.

There are many ways in which the paradigm of social networking can
align to the recruitment process encouraging employees to be more
visible online and use networks to identify innovators. Some
companies use employee-referral programs to obtain quality
candidates like approach key employees for referrals and influence
non-employee referrals. Or even posting videos about the organization
online or on video-sharing sites such as YouTube, .analogy being if an
ad has thousand words, then short films are more worth demonstrating
I what it's like to work at your company.

The informal and friendly way of communicating with candidates


proves to be a positive catalyst. Professionals are more comfortable
during these interactions on SNS which gives employers objectivity and
clarity in making candidate choices.
Apart from the above factors like time, cost and efficiency benefits..
.user content like lagging, annotations and recorded behavior help the
recruiter in understanding the character of the candidate
appropriately. Users interests, hobbies, family background and
educational institutes from where they studied also gives HR an idea
about their personality.

A New York-based company, Vault.com conducted a survey on around


350 employers in 2007. The results-Stated that about 44% of
employers use SNSs to examine the profiles of job candidates, and
39% had looked up the profile of a current employee.

A recent survey by the Society for Human Resources Management


(SHRM) revealed that only 9% of HR pros frequently use SNS sites to
recruit. The benefits of using Facebook, MySpace and Linkedln were
their abilities to reach passive candidates (69%), target a specific level
of experience (40%), find someone with specific skills (38%), and
increase employer brand recognition (35%).

Another current study, carried out by the Human Capital Institute and
Saba, titled Capturing the Value of Social Networks showed that
companies are utilizing SNS tools for onboarding (71%), recruiting
(62%) and mentoring/leadership (61%).

Illustrations

SNSs like Linkedln has a user-base of 30 million professionals world-


wide, Facebook has more than 150 million active users globally and
MySpace has 110 million users internationally. Besides, XING and
Friendster arc also globally popular, Twitter in U.S., Multiply in Asia,
Mixi in Japan, Cyworld in Korea, and Xiaonei in China.

A Global Staffing Strategic Initiative Manager of Hewlett Packard used


Linkedln in a number of different ways to find employees including
searching by employer.
TECH TWIST FOR HR
Web 2.0 has infiltrated organizations in a new form of Social
Networking Sites. Does this technological twist help employers
use this part of cyberspace in a bid to recruit retain and
interact with staff?

Technology is advancing and providing more and more options for


attracting, recruiting and retaining talent. Presently, the most
intriguing development... Social Networking Sites (SNSs)...is giving
candidates and recruiters, employers and employees the opportunity
to interact with each other...more liberally.

Swift flashback

True to its name, previously, this web-based service allowed people to


create their individual profiles, connect with their friends, send
comments, and transmit private/ instant messages. History shows that
the first SNS was launched in 1997; Sixdegrees.com and it began
having networking features in 1998...exhibiting profiles on major
community and friendship sites....with the option of others able to view
each other's friends list. Another site, Classmates.com welcomed
people to link with their high school or college friends. AsianAvenue,
BlackPlanet, and MiGente allowed users to create personal and
professional profiles. The Y2K brought in changes.. .different sites
adding SNS features like Korean site Cyworld in 2001 and the Swedish
community site LunarStorm completely became a SNS in 2000,
featuring additional things like guestbooks and diary pages. In 2001,
Ryze.com allowed people to leverage their business networks creating
a landmark in the field of SNS. Ibis helped in identifying candidates
through referrals since it forms a trusted network of professionals.