Swati CA

Swati_CA column in The Hindu Business Line

Tuesday, April 04, 2006

OPTIC for better employee focus

“The world is facing major shortages of a critical resource—not petroleum, but people. Demographic shifts (aging populations, declining birth-rates, economic migration), social evolution, inadequate educational programs, globalisation, and entrepreneurial practices (outsourcing, off-shoring, on-demand employment) are causing shortages, not only in the overall availability of talent but also – and more significantly – in the specific skills and competences required in industrialised, emerging, and developing economies like India.”

“There is already a talent shortage in many areas of the global labour force, a situation that will grow more acute and more widespread across more jobs over the next 10 years and could threaten the engines of world economic growth and prosperity.”

“HR managers, especially in the IT / ITES sector, must bridge the ever-increasing gap between the demand and the supply of suitable employees. Employers don’t want just anybody; they want the right kind of people who can keep pace with the unique work patterns in the IT industry.”

“The toughest concern for an HR manager, however, is a high attrition rate. In India, the average attrition rate in the technology sector is approximately 30-35 percent per year. This means that HR managers have to work that much harder, just to keep the same number of employees.”

“Keeping low attrition levels is a major challenge as the demand outstrips the supply of good talent by a big margin. For example, the salary growth plan for each employee should be well defined, because failing to do so only encourages poaching by other companies who can offer a higher salary. Work environment is also a significant factor. Many individuals (mostly fresh graduates) who join the IT industry are not aware of all the work aspects of the job. Once they join the IT sector and understand its requirements, they are taken aback by the long working hours, work pressures and the monotony of the job. This results in the high attrition rate at the junior levels especially during their initial days in the industry. A scientific and analytical approach to the whole issue should be implemented.”

“Pay cheques alone are not enough to retain employees. An organisation also needs to consider other aspects like secure career, benefits, perks and communication. The attrition battle could be won by focusing on retention, making work a fun place, having education and ongoing learning for the workforce and treating applicants and employees in the same way as one treats customers.”

“Companies need to go in for a diverse workforce, which does not only mean only race or gender diversity but also includes age, experience and perspective. Diversity in turn results in innovation and success. The 80:20 rule also applies to recruitment. Studies show that 80 per cent of the company’s profit comes from the efforts of 20 per cent of the employees.”

“There are lot of factors that are responsible for keeping the attrition rates down and the key to all those is hiring right people who share the company’s vision and values. At Synygy we have a special system in place that ascertains if the person is fit for the job. It’s not just about job performance, it is about cultural fit.”

“Experience shows that cultural fit is one of the best predictors of whether a new employee will succeed at Synygy, so the process of hiring and training an employee focuses on core values and company culture.”

“Everyone at Synygy regularly meets with their mentor to discuss and evaluate their performance. These evaluations focus on how the employee has demonstrated Synygy’s core values (Ownership, Professionalism, Teamwork, continuous Improvement, and Customer focus – known as OPTIC) and the specific job skills required for their position. The feedback is based on specific examples, providing the employee with actionable information about areas needing improvement.”

“Every employee undergoes an initial three month probation period. Mentors monitor the performance a new employee very closely during this period with reviews at the end of each month, for the first three months. After the three months are completed, employees settle into a regular rhythm of quarterly and six monthly evaluations.”

“At Synygy all employees have a variable component of salary based on their performance. All employees at Synygy are paid a quarterly performance bonus; the amount determined by calculating the achievements against quarterly objectives, evaluations by co-workers, and evaluations by clients. At Synygy the employees also have an opportunity to evaluate their mentors.”

“Since job performance is evaluated on a quarterly basis, the semi-annual performance review is more of a career planning and self-assessment session, where, mentee and mentor map out what skills and competencies the employee needs to develop for the next step in their career path.”

“Companies should also train people in giving and receiving feedback. Companies that implement 360-degree feedback without first checking and developing managers’ feedback skills risk serious damage to teamwork and morale. Providing constructive feedback takes instruction, training and practice.”

“While training individuals to give and receive feedback may temporarily increase the expense associated with 360-degree feedback programs, the gains will outweigh the higher cost as the feedback delivered to participants becomes more focused, targeting the behaviours most closely associated with value creation and destruction.”

“Ultimately, the goal should be to create a culture in which individuals feel comfortable giving and receiving feedback--both positive and negative--on a real--time basis, hence talking attrition at the root level.”

Parag Wadhone, Manager-HR, Synygy India P Ltd, Pune.

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