Xpress HR

Monthly newsletter of SAPPHIRE July 2013

A newsletter reborn
It has been a while since Xpress HR hit the press. Around three months to be precise. In the meantime a lot has happened in the world of Human Resources Management.
Additionally, the old cluttered layout is replaced by a cleaner one with a focus on mini
What this issue is all about:A PwC Research Brief on Total Rewards in India Two articles on the theme of last month: From workers to owners: reshaping the thought process to create an effective workforce.

An article on sustainable development from the perspective of a new age HR manager

Some glimpses of HR news and a statistic repository!

Total Rewards in India a PwC Research Brief

TCA Lakshminarasimhan & Tathagata Basu PwC India, People & Change

highest globally. This salary growth trend is observable (with slight variations) across different organizational levels and industries. The Indian economy stands at a critical juncture today. Though the Indian economic growth appears to have stabilized, Indian business leaders are optimistic about the prospects of the global economy and are confident of their companys

revenue growth prospects over the next 12

months. This is significantly different when

last decade. From the early 2000 (2001-03) when the GDP growth rate varied in the range of 3.5% - 5.5% it moved to an altogether different orbit of growth between the years 2006 -08, only to fall drastically in 2009. The heady days of the mid 2000s where the Indian GDP grew at >9% clearly seems to be over. Also, the Indian economy does not seem to have recovered completely from the economic crises of 2008-09. The Indian GDP appears to be settling down to a modest GDP growth rate of 5 -6% in the near term. Though this appears to be a far cry from the growth

compared with the views held by their global/ he Indian economy has seen a see-saw of fortunes in the regional peers. The rewards scenario in India too appears to have reached an inflection point. Consistent salary increases are gradually eroding the advantages of wage arbitrage that Indian businesses used to enjoy. However, Indian CEOs anticipate serious challenges in being able to

rates of mid 2000, it is above the Hindu rates of growth which India
witnessed pre-1991 and more importantly is significantly higher than the growth rates in most developed nations around the world. The salary increases of India Inc. too have mirrored the Indian economy in many ways. The years between 2004 and 2008 saw salary increases in the tune of 13.5% - 15%. This was markedly higher than the rate of increase seen in the years 2001-03. The salary increases in 2009 clearly reflected the state of the Indian economy. The %increase in salary in 2009 dipped by close to 5% over the last year. Though the reward scenario and salary increase trends in India have recovered since then the attract and retain talent and feel that compensation of top executives average increase between the years 2010 and 2013 (11%) is significantly needs to be matched vis--vis peers in other organizations to retain top lower than what was seen between 2004 and 2008 (14.12%). On an talent.

average, over the last decade, salaries have increased by 12%, which is
believed to be the highest in the Asia Pacific region and amongst the

It will be interesting to note how the reward landscape in India

shapes up and responds to this challenge. It might also be an opportune Indian Government to empower and educate the girl child, increasing time to assess the Indian rewards scenario and derive learning which might number of women are joining the Indian workforce. help HR leaders shape the future of total rewards in India.

However all this does not seem to have addressed the demand-supply dis-balance between labour market needs and the skilled manpower available to fulfill them. 81% of Indian CEOs continue to see the availability of key skills as the biggest threat to its growth prospects and 53% of Indian employers say that a skill shortage is a key reason for entry level vacancy. (Source: PwC 16th Annual CEO Survey; McKinsey on Society, 2012) This level of diversity in the workforce requires

organizations to look for more innovative means of

The India Opportunity: staying relevant to different talent segments, each with their distinct set of expectations from their employers. Thus a one-size India is today -fits-all model will not suffice. Required is a flexible HR strategy/approach the second which lends itself for customization to meet the requirement of different most populous target groups. country in the world with a population of 1.21 bn (17.5 % of world population). It is here that the Total Rewards Philosophy fits the requirements of India Inc. to a T. Total Rewards not only takes into account the traditional reward elements like Fixed Pay, Benefits, Short Term and Long Term Incentives and Retirals but also looks at the intangibles which reflect the Employee Value Proposition that the organization has to offer. These

Interestingly
more than 50% of this population is below the age of 25 and more than 65% below the age of 35. It is expected that, in 2020, the average age of an Indian will be

EVP elements can encompass aspects like growth and development

opportunities, international exposure, flexible work options, work-life balance etc.

Thus, Toward Rewards (if suitably fine tuned) has the potential to 29 years, compared to 37 for China and 48 for Japan, thereby making India satisfy diverse needs. It can be designed to motivate the entry level the country with the largest and youngest employable population in the employee who is looking for a high fixed compensation to repay his world. With more and more young employees joining the workforce India educational loan as much as the experienced manager who is looking for a Inc. is faced with the daunting task of customizing their people practices to comfortable life post retirement. It can address the needs of the women satisfy the needs of this diverse talent pool. Research has shown that the employee who has recently rejoined the workforce and is looking for more engagement drivers of the Millennians is very different from the older flexibility to manage both the professional and personal fronts employees. Hence approaches to simultaneously attract and retain the simultaneously, and also the aggressive mid-level sales employee, who is young and the experienced will be a constant challenge that Indian business looking for larger rewards for the stiff targets he is willing to take on. It can

and people leaders will continue to grapple with.

However, we would be fooling ourselves if we thought that the generation divide is the key element of employment diversity in India. The XX% of the Indian population in the organized sector, are employed by a wide array of industry and sectors namely telecom, IT, ITES, banking,

be used to attract both the highly qualified resource who is looking for
better avenues to apply his knowledge, display his potential and in so doing grow in the organization, as well as, the campus recruit who is looking for a workplace which will help him hone and develop his skills and make them relevant and value adding to the organization.

insurance, financial services, manufacturing, construction etc. The talent We feel that the opportunity for implementing Total Rewards in India is and capability requirement for companies in each of these sectors is as immense. If effectively leveraged it is a powerful instrument in the hands of the Indian HR leaders which he can effectively use to address attraction, diverse as the kind of career and life options that each of them offers. retention and development challenges across the different life stages of an The general literacy and education levels in India has improved employee. substantially in the last 2-3 decades. This has led to increasing number of Graduates and Post Graduates seeking employment today. Add to this the fact that over the last 2 decades due to aggressive efforts made by the

Article Writing Competition Winner

Vinoo Kurien Thomas, XLRI Theme: From workers to owners: reshaping the thought process to create an effective workforce.

great employee culture at work but still stays on top of its business. man embarked on the journey to produce material things, Corporations FedEx has a very casual style of working where the work force feel a sense of pride in signing in to the became an integral part of human social development. Individuals run the Corporation, but when seen as a single entity it can be intimidating. With the population growing everyday and newer markets being captured, the corporate machine is on an unstoppable roll. It is

Art, communication and culture have been around since time edEx comes to mind when you are looking for a firm with a memorial. But the Corporation is a relatively newer concept. Ever since

office every day. Started by CEO Fred Smith, it had the least ideal of starts imperative to consider the extent to which the workforce can be with several blunders at the inception stage, but it was the passion and controlled and made to labour purely for the corporate masters bottom

hard work of his employees who never felt intimidated or resigned to line. One must consider the mindset
behaving as slaves that kept them rolling. If the workers instead felt a the employee as he or she walks in sense of dislike, it is fair to assume that FedEx would not be where it is the drab cubicle which has become now today. Thus, it is vital to create a positive work culture where you synonymous with corporate slavery. share successes, involve employees in decision making, have clear Curiously, even hospitals are run expectations and focus on what is right. akin to a large company or factory, but there is very little negativity Human Resource professionals definitely play a crucial role in associated with the job. bridging the vast gulf in an employees perception of his role in an organization. Focus should be on making the workforce realise that they are an important and integral part of the organization and not corporate slaves who toil day and night for boosting the firms profits. The need then is to tackle the concept of a corporate slave like feeling in the mind of every like employee and make family employees experience and feel equally-important in or the members mitigated corporate by a

of
to

To compete and win in todays economy, the organization must be able to realise the full potential of the employees. In order for the employer to thrive and deliver increased value, the employees too need to move away from the notion of corporate slavery and willingly develop their capabilities. In an employers perspective, the ability to compete, and in some cases even survive, depends on a loyal and engaged workforce who will add value to each day that they report in for work. This is only possible if the employee recognizes and genuinely connects to the organization in a way akin to that of home. Merely providing career resources and leaving

When employees find a sense of

meaning in their work, they work harder at it. What would otherwise be a normal activity takes on much more when there is a sense of meaning associated with it, like at a restaurant or in a movie.

structure. The divide can be reduced number of measures, which if

implemented properly would also indirectly lead to better working it to the employees to make a choice will not have far-reaching effects.

conditions which is top-most in the minds of the workforce.

An effective strategy here will include a career development process

effort involving both employer and employee. The company leadership

will need to take an active role towards this effort and career of meaning associated with it, like at a restaurant or in a movie. The development starts right from the first initiation of an employee into the entire emotional appeal of the event gives it a heightened sense of work space. meaning.

I would like to draw a parallel to the movie The Matrix, where

Just like we keep our homes clean, at its most effective,

a society remarkable similar to the existing one is portrayed. The purpose ownership gives employees not just a financial reason to perform but a of the films message was in part to alert everyone to the already reason to belong. The power of strong, supportive personal relationships established characteristics of dominant rule. When employees find a cannot be stated enough. Just as family and friends create a meaningful sense of meaning in their work, they work harder at it. What would personal life, supportive relationships at work enabled by a change in the otherwise be a normal activity takes on much more when there is a sense thought process from considering workers as participants to considering

CLC Report, Q1 2013

Leading the Path to Sustainable Development Gaurav Sharma & Rahul Ranganathan
The shift towards Sustainable Development requires organizational change and cultural change at its core, brought about under the stewardship of the new age HR manager

The Challenge We as humans are unique in that we dont as much live in a world

Providing new employees with information about sustainable development policies and initiatives

governed by the laws of nature as we do in a world governed by the laws Incentives: A mix of rewards ranging from financial security to bonuses, of economics. It is the marketplace that defines our lifestyle without promotions and peer recognition needs to be incorporated to motivate considerable regard to the impact our actions have on the world at large. the employees to commit to the path of sustainability. This may be However, it is important to realize that there is only so much that the actualized through: spaceship earth can tolerate. There is a limit to which we can exploit nature before it decides to retaliate and takes matters in her hands to set the balance right. In wake of this realization, the biggest challenge faced by corporate today is to change their nexus from that of exploitative growth to that of sustainable development. To inculcate sustainability oriented values is the imposing task cut out for the new age HR for change can only be Competency Development: To ensure that the company progress on the brought about through a two pronged approach targeting both the top right path it is imperative to inculcate the right competencies in the work management as well as the lower rung of employees to ensure that the force. Augmentation of a sustainable development perspective would ideas of sustainability is integrated in the very fabric of the organization. influence critical business decisions to be in line with the long term goals However, before such initiatives are taken the HR in itself should be able of the organization. Critical competencies could be developed through: to understand and appreciate the gravity of the situation and be aware of the impact of these decisions. Yet, it is not uncommon to see HRs lacking competencies in the broader realm of sustainability, with even well Including social and environmental issues within employee training and development programmes Ensure training programmes take into account the business risks and opportunities from sustainable development and ways to identify them Separate training programmes at separate levels of seniority to To ensure that an organization treads on the path of sustainable development, it is imperative that the route be ingrained in the DNA of the organization modelled by the HR. The same maybe attained by: Corporate social-environmental performance is strongly associated with marketplace success. One of the most potent reasons points to better Recruitment: The primary imperative is to develop a pool of employees branding. Companies that are socially and environmentally conscious, conscious to the needs of the society. This would be achieved through: strike a chord with the public, hence maintaining better brand value. This in turn enables them to attract and retain better talent because talent Integrating sustainable development issues in the recruitment wants to work with the best companies. process target the gamut of employees and management Incorporating social and environmental considerations within the performance appraisal system

Supporting adequate work-life balance

Encouraging employees to participate in corporate community involvement programmes

intended initiatives failing to create a ripple.

The Innovation

Monitoring the long-term competency requirements for the

company

Checks and Balances, Technology in Non-Hierarchical Organisations: The Solution for Creating an Empowered and Effective Workforce

D P Gokul Kartik Shaliesh J Mehta School of Management, IIT Bombay

Between capitalist and communist society there lies the period of the revolutionary transformation of the one into the other. Corresponding to this is also a political transition period in which the state can be nothing but the revolutionary dictatorship of the proletariat - Karl Marx. The leaders of the Russian revolution were inspired by such propaganda of great communist thinkers which in turn led to an autocratic rule in the communist USSR. Eventually though, this led to the fall of Communism. The thinkers had a fore vision on the proletariat

management thinker, proposed the mature-immature continuum theory in which he suggested that individuals always strive to move from immaturity to maturity and mostly the authoritative or centralised organisation structure is built in such a way that it prevents this

dictatorship but they failed to foresee the system or the political checks
and balances that would sustain through till the transformation. On the other hand, many propagated anarchism as a solution to the class struggles during those times. But, complete freedom without any centralised authority would also not sustain over a long time. The logic behind anarchism is free association which means individuals are no longer deprived of access to means of production enabling them to freely associate (without social constraint) to

development in individuals. Thus,

he proposed a non-hierarchical organisation structure in place of the pyramidal structure. But, as we saw in the failure of Anarchism, individuals do not always work towards moving from immaturity to maturity. But, we have several other advantages of having a nonhierarchical organisation structure in place. Especially in todays business scenario where ideas could transform the whole image of the company, it is

Building a non-hierarchical
leadership into an organisation that has followed hierarchical leadership and also retaining the pros and eliminating cons will be the most challenging task.

produce and reproduce their own

conditions of existence and fulfil their individual and creative needs and

necessary to have a non-hierarchical

structure which would enable the employees to come forward with such

desires. So, it was assumed that when individuals are given complete freedom they freely associate with each other and work towards satisfying their needs and desires. But, this basic assumption in itself does not hold good. A very good example for this could be the failure of the agrarian industry in Zimbabwe after the land reforms measures in

ideas. But, this again at times could lead to a herd-like mentality. Moving to a non-hierarchical structure from a hierarchical one therefore has its pros and cons.

Building a non-hierarchical leadership into an organisation that has followed hierarchical leadership and also retaining the pros and 2000. Amongst many reasons, the disinterest of new land owners in eliminating cons will be the most challenging task. From the design farming is also argued as one of the reasons for failure of the land phase to the implementation phase and thereafter, effective monitoring reforms. So, it is evident that free association is not always possible. of the implementation is a daunting task. However, many organisations Transfer of power from one authoritative group to another have successfully done this in the near past and some organisations authoritative group is not the solution for class struggle in organisations. have taken steps towards this. The cultural change that such Neither is the complete breakdown of authority. Chris Argyris, a organisations have undergone has benefitted them hugely but the

process behind such a change is always a difficult path to tread on. Any such change dissipates from top to bottom even though the focus is on elevating the bottom to disintegrate the hierarchy. So, while building a non-hierarchical organisation, the main focus should be to design the system with mutual checks and balances that will result in the paradoxical controlled freedom. One way to bring about this balance is in thoroughly understanding the fact that non-hierarchical organisations are all about collaboration and right to use of technology. In the modern era of Information technology, effective communication is one of the ways of achieving collaboration. IT has enabled peer-to-peer new communication, bottom-up communication

and much more which helps collaborative decision making, sharing of new ideas etc. These IT systems should be weaved into the functions and divisions of the organisation instead of acting in isolation. Information Technology in the form of social media has changed the way how people work together. Newer technologies like mobile computing have further increased the proliferation of social media in todays organisations. Thus, a proper system design backed with an appropriate technology, could lead to the creation of empowered and efficient individuals, at both a societal and an organisational level.

Glimpses of HR (Click-through to read!)

Crowdsourcing Feedback Provides a More Accurate Picture of Employee Performance A recent survey conducted by Globoforce and SHRM shows that companies that use crowdsourced recognition data within performance reviews have more effective performance management processes. Employees Believe Social Tools at Work Help Foster Productivity and Teamwork Nearly half of employees report that social tools (such as Twitter, Microsoft Lync, and Facebook) at work help increase productivity, but more than 30% of companies underestimate the value of these tools and often restrict their use. Global Talent Shortage Continues to Hurt Companies' Performance A recent survey by ManpowerGroup reveals that a perennial global talent shortage is intensifying and negatively impacting companies' performance.

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Our email: sapphire@xlri.ac.in Our website: http://sapphirexlri.com
Editors:-

Manisha Dalan
Rahul Ranganathan TCA Lakshminarasimhan Thank you for reading!