People Management- Miss-stakes!

What not to do when the times are tough…

Key learnings:

1. Business heads too are human, and prone to committing errors
2. They need to avoid certain mistakes to be able to survive tough times
   

Often, it is what you don’t do that impacts success, rather than what you do. Quite a few business heads have undone their good work with a few slip-ups here and there. Unfortunately, the condition of the economy hasn’t supported them. Mistakes that could have easily been ignored in good times appear bigger and uglier during a recession. Expecting the top brass to be error-free is both unfair and unrealistic. But there are certain mistakes that must be avoided to survive the tough times. Here is what business heads must be wary of:

Look before you leap

Difficult times compel individuals to take difficult actions. But what is tough to fathom is why those actions appear more desperate than deliberate. In this downturn too, managements have made quite a few impulsive and copycat decisions, which they will regret once the economy bounces back. Decisions have to be made diligently, particularly during tough times. Right from evaluating the source of information to a critical analysis of the worth of the decision, due-diligence should be the guiding principle.

Power corrupts

When in trouble, the more the number of friends and advisors one has the better the chances of surviving. Even though everyone agrees that networking, both social and professional, can help bail out individuals, business heads are chary of networking with their rank and file. Although the reverse should be the case, managements become more guarded and cloistered when times turn bad. Here is what can help correct the mistake:

1. Involve everyone, right from a shop-floor worker to a C-level executive, in generating ideas, innovative methods and short-cuts
2. Continue to delegate as before
3. Be transparent

Also, do what US President Barack Obama does! Obama’s team hosts discussions on the internet to invite suggestions and opinions from different people. In addition to generating ideas, the responses enable them to evaluate public sentiments.

Hasty decisions

“No one ever downsized their way to greatness,” says a business analyst. Yet, most belt-tightening initiatives have been so severe that the possibility of bouncing back to normalcy when the economy rolls out is bleak. In trimming flab, organisations have cut so deep that some of the muscle has also been hacked. Getting back top performers, who have been treated poorly, is almost impossible. Another equally hasty action is implementing strict recruitment freezes.

A downturn is an excellent time to pick up good talent at competitive wages. Once this opportunity is lost, the ugly practice of poaching, and paying through one’s nose, will return! Also, in organisations where layoffs have been extensive, those who stay will be grateful only for a few days! Soon employees will realise that they must now shoulder the workload of those laid off. Their disappointment and dissent will be just the beginning of troubles to follow! An effective way out is to try different alternatives to laying off.

Expansion

With organisations reducing the numbers on their rolls, meeting the needs of customers will be a huge task. So, however tempted managements may be to pick up the competitors’ ‘uncared for’ customers, a downturn is not an opportune time to expand business. With fewer employees, there is no guarantee that customers, who shifted loyalty because they have been treated poorly, will receive any better treatment. Moreover, expecting teams with reduced manpower to be enthused about new business is irrational. A better way would be to treat existing customers with extra care. When customers stand testimony to how well an organisation took care of them despite the downturn, there can be no better advertising than that.

Do what can be done

The ‘more with less’ frenzy is such that managements stretch their fewer resources over heavy tasks without recognising that every work team will have only limited elasticity. A business consultant observes, “I have found that much of the ‘more’ is work that provides no value at the end of the day.” Business heads must scrutinise every task and determine its ROI, and only those with good returns should be retained, refitted into the workflow and delegated. Moreover, an employee performing five meaningful tasks will not feel as overworked as someone handling fewer, but non-contributory tasks.

Everyone makes mistakes, even business heads. But making the above-mentioned ones is more than a slip-up.

Ref: TheManageMentor.

Moving ahead during tough times

It is a seesaw-like situation for executives in the corporate world as each executive tries to justify his personal and professional goals. Pressure times compel top class executives to reveal their true personality. Their determination and composure in such tiring situations reveal their leadership qualities. However each employee can be a leader in his own stride by inculcating perseverance to survive in today's tough world.

Fear factor

Often pressure builds a sense of urgency and forces an individual to arrive at logical solutions for practical problems. When an employee is apprehensive of the outcome of a business strategy he generally tends to evade it thereby complicating the situation. Evading must be the last thing on an employee's mind if survival is his goal.

Away from...

To mobilise organisations, immediacy must be created. Employees though slip into a fear psychosis when faced with immediacy. Fear moves them into immediate action but not necessarily in the same direction. Therefore, all that fear does is to misalign the efforts of individual leaders to motivate employees towards common goals. Fear only brings to naught leaders' efforts to motivate employees. This is further compounded by the stress it produces.
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Corporate health

Stress is the causative factor for many an ailment in the corporate health, leave alone employee personal health. Stressful employees lack creativity and become inefficient. Their perspectives are narrowed down and their problem-solving abilities slacken and learning ceases. Even employee morale diminishes leading to disengagement. Disengagement cannot contribute to peak performance!

The motivating duo

The duo that influences the success of businesses is fear and quite surprisingly leadership. Truly, fear scatters the efforts of employees in random directions. Leadership balances the negative effects of fear in employees by aligning their goals in the desired direction.

Sharing is winning

Pre- defined goals help employees visualise the path they would be treading. Sharing the organisation's vision, mission and values is key to its success.

Good, bad and the best

Identification of ultimate goals unlocks creativity, enhances problem-solving skills and helps utilise resources towards a purposeful mental state. Working towards challenging goals, creates eustress, a positive stress syndrome, which channelises energy. However, directionless movement creates bad stress. The balance between the good and bad stress needs to be delicately managed. Coordination is crucial here. Lack of coordination could paralyse an employee's ability to take on challenges. Therefore, good stress and coordination must complement each other.

The pull effect

Pulling the workforce back into powerful, productive mental state requires effective leadership. Leaders must be positive and shun negative attitudes at the workplace to radiate stress effectively. Spreading positive feelings throughout the team creates intrinsic motivation.

Towards leadership

Extraordinary leaders thrive despite the restrictions imposed by tough and challenging times. That every employee is a leader in himself implies that there must be a storehouse of some intangible inherent characteristics.

Bigger is better. The leader must view the problem in its entirety not in parts. Vision differentiates a leader from a follower. It helps him disentangle the nitty-gritties of a problem that prevent him from resolving it.

Fire from within. Unwarranted faultfinding leads to ineffective teamwork. Leaders must act rationally and objectively, without being carried away by internal conflicts.

First and foremost. Sacrifice is an important characteristic of a good leader. A leader who sacrifices first for his team will earn the loyalty of his subordinates and colleagues.

Calm and composed. A relaxed mind enables employees to make better decisions.
Move them forward. Leaders emphasise on being optimistic motivators during rough times, thereby moving the employees forward towards their goals.

Small leads to the big. Goals must be split into smaller achievable targets. Employees must be rewarded when those goals are achieved. A consistent win in small goals keeps the track of success steady for the employees while motivating them.

Have more of humour. A decent sense of humour even during tough times helps maintain the tempo of work/life balance.

Tripod balance

A motivated team relies on the tripod stand fundamental. So building a motivated team during hardships requires the top management to hire, train and communicate constantly.
Hiring the best is essential because, they make the job of motivating easier. A bad hire for the right job is difficult to motivate.

All employees cannot be perfect but are undoubtedly trainable. A right mix of technical skills, people skills and self-management skills is essential for appropriate training. Training must not only be appropriate, but also adequate. Once trained, employees must be encouraged to take a holistic perspective of their company and replenish their capacity for creativity.

Training promotes competence and therefore, confidence, the latter being an internal motivator. Competence also reduces stress and increases productivity besides improving attitude.

If employees' contributions are not acknowledged, they get demotivated and withdraw. Employees work enthusiastically if their ideas are valued. Talking about uncertain situations help defuse anxiety, which may lead to stress. Truth is an antidote for uncertainty. Therefore, constant communication is an imperative.

Reconnecting people

Once stress is reduced, the onus lies on the leaders to provide a direction to the employees and motivate them adequately and appropriately. Over-motivating the employees could have negative impact too, so leaders must be cautious.

Productivity is about moving forward in a uniform direction once it has been determined with the team consensus. Anxiety and fear are imaginary monsters and employees must avoid fighting them to perform well.

Doing Business Across Cultures: Cross Cultural Training That Works

Working across cultures is usually more interesting, if not always more enjoyable, than if we were just doing business with our own nationality.

It is most likely that 60 to 70 percent of "the ways we like to do business" are quite familiar - if not always fully understood - among our cross cultural colleagues and clients.

Conversely, there are several extremely important areas of interaction between culturally diverse people which can probably never be standardized. And these are the areas which provide major surprises - and costly pitfalls. How can we anticipate these differences and work effectively?

As people from different cultural groups take on the challenge of working together, cultural values sometimes conflict. We can misunderstand each other, and react in ways that can hinder our partnerships. More often than not we are not even aware that our cultural filters or assumptions are different from others.

At a minimum, there are three vital areas to take into account when it comes to culturally differing business attitudes and behavior:

• Attitudes Toward Conflict. Some cultures view conflict as a positive dynamic while others see conflict as something to be avoided. While in the U.S. conflict is not usually desirable, people are encouraged to deal directly with conflicts that arise. In contrast, in many Asian cultures, where relationships and harmony are the basis for effective communication, open conflict is avoided. Conflict is seen as embarrassing or demeaning and is best worked out quietly. Written exchanges, indirect communication or using a third person as a message bearer might be the favored way to address conflict.

• Approaches to Completing Tasks. When it comes to working together effectively on a task, cultures differ with respect to relationships and task completion. Asian and Hispanic cultures tend to attach more value to developing relationships at the beginning of a shared project and more emphasis on task completion toward the end compared to Europeans and Americans. In general, European and American culture tends to focus immediately on the task at hand, and let relationships develop as they work on the task. This does not mean that people from any one of these cultural backgrounds are more or less committed to accomplishing tasks, or value relationships more or less; it simply means they may pursue them differently.

• Communication Styles. When doing business across cultures, you may believe you are communicating clearly, but you are probably headed for big trouble. Most executives claim they try to adjust their English language in a foreign business situation. The facts show that there are still problems. After one recent meeting of a Management Committee, we asked a senior Chinese executive how much he got from the discussion. He said, "Not more than 50 percent." Take the time to check whether you are actually understood; avoid using slang and hire professional translators and interpreters.

Cut Costs Without Cutting Head Count

When money is tight and budgets constrict, many organizations turn to downsizing to cut costs. That's certainly the case currently. U.S. planned layoffs were up a whopping 275 percent in December compared to last year, according to Reuters.

Yet job cuts aren't the only way for companies to reduce spending - and many times they're not the best way, either. According to a 1995 study by William McKinley, Carol Sanchez and Allen Schick in the Academy of Management Journal, "[T]here is considerable evidence that downsizing does not reduce expenses as much as desired, and that sometimes expenses may actually increase."

The authors cited a Wyatt Co. survey that found that fewer than half of respondents who were using restructuring for cost reduction actually met their targets and that only 22 percent of restructuring companies managed to increase productivity to their satisfaction. This likely is still the case today.

The bottom line is that while layoffs are sometimes an unpleasant but necessary reality, they don't have to be the only reality. There are ways for companies to cut costs without resorting to cutting head count in hourly workforces, according to John Anderson, director of retail marketing at Kronos, a workforce and employee management software company.

Anderson offered five alternative steps companies can take to control costs:

1. Align labor budgeting process with strategic goals.

Many budgeting processes don't consider the hidden costs associated with managing a workforce. Companies should ensure their labor budgeting is linked with established business objectives and productivity models.

2. Confirm the proper head count mix.

The right ratio of full-time to part-time workers will keep productivity at the maximum and costs at the minimum. Anderson said companies should be open to the idea that they can reduce spending by actually adding head count in the form of part-time labor.

3. Ensure proper labor allocation.

A lack of understanding of employees' day-to-day work can lead companies to improperly allot spending. Thus, talent managers should ensure job descriptions match up with the actual work done and are in alignment with strategic objectives. They also should examine periods of productivity across the organization and spend less labor money on slower times.

4. Remove the waste.

Companies should look closely at their labor-tracking processes and identify areas for savings. For example, employees with benefits might currently be paid for time they're not working or employees may be working during unscheduled times.

5. Maximize efficiencies

According to Anderson, every company has inefficiencies, and the more they're identified and reduced, the more money can be saved. He said companies should consider using technology to maximize efficiency in areas such as employee engagement, leave requests or shift availability preferences.

Ref: Agatha Gilmore

HR: No more the 'soft-guys'

It is indeed time for some deep introspection, otherwise, the HR impressions are unlikely to change in any remarkable hurry. And that will be a real tragedy.

Sure, every CEO worth every rupee of his precious sound byte says, “people are my most critical assets”; but beyond that famous lip service, do we really see a genuine long-term commitment to that clichéd phrase? To be brutally honest, the answer is a deafening NO. Which is why the moment that we have even a temporary down-turn, the drawers are suddenly emptied, business forecasts are re-done and the pink slips emerge in a dramatic hurry. Now why would an intelligent professional suddenly drop his supposed “most crucial asset” in such a desperate hurry? The reasons range from short-term focus, an obsession with business numbers, lack of understanding of HR role, down to sheer inability to recognise the human angle. Yet, the principal responsibility for being shafted unceremoniously by the CEO at the slighted pretext lies with the HR professionals themselves. That’s the harsh reality.

What is the bottom line mission of a solid, well-founded HR unit in today’s modern, savvy organisations’ people-driven team? How does it really add real tangible value to business results and overall effectiveness, breaking away from the traditional slot of being payroll masters , doling out salary cheques and minding attendance registers, and receiving unending flak for every trivial human failure.

If you do a basic assessment of the profession of Human Resources compared to that of Marketing or Finance (it’s usual competitors) or even General management, you can begin to see that HR has traditionally chosen the quiet corner voluntarily, retreating almost humbly into the backwaters. While Marketing (along with Sales and Distribution etc.) has always prided on being the bread-winners who create the revenue pipe-line, Finance has the perennial positioning of being the cold-hearted systemic function that does hard number-crunching and talks complex ratios. They are seen as more cerebral et al. From time immemorial, the HR guy, on the other hand, has allowed a perception to float and register that they are the 'soft guys'. Just because they end up often dealing with conflict resolution, employee motivation, counseling sessions, and morale building, the rest of HRs contemporaries treat them as the “feel-good” blokes, who occasionally break the monotony of the boardroom. And bring some mild entertainment along.

It is time for HR professionals to reposition their own stereotype image, and as they say, charity begins at home. It is time for some deep introspection, otherwise, the HR impressions are unlikely to change in any remarkable hurry. And that will be a real tragedy. Because the bottom-line is that HR has every reason to believe that they are, in a services economy and consumer-driven markets in particular, one of the key variables for success. If not, probably the most important one.

HR professionals who are able to look at the company business strategy and identify those internal processes and people-practices that need to be newly created or amended to support the business are poised to make a leapfrog. That’s the only way forward. Change management starts with the HR professionals themselves raising their performance bars. Quite simply, because the entire success story gets scripted by how HR gets the right team going. Not just by recruiting right talent, but getting them to stay. And perform. It is a tall order.

Give me one company’s high-sounding lofty vision or mission statements that do not have the people and employee element in it. Or are some companies presumptuous enough to believe that their business success can be achieved without motivated and quality employee effort? The ability to identify the communication and human interventions that need to take place to support business activity with a vibrant and engaged workforce, is today a required competency of HR practitioners. Employee engagement is no longer just a passing buzzword or a fashionable management fad.

Can we even contemplate the impact of the professional uncertainties and personal struggles world-wide amongst several thousands of employees of the Lehman Brothers-Merrill Lynch –AIG bale-outs and virtual bankruptcy? While the investment banker makes a massive mess (after pocketing million-dollar bonuses), it is the HR person who cleans the stacked-up debris. Who does the tough task of severance, settlements and not-so-golden handshakes, an inevitable fall-out.

The soft guy usually becomes the fall-guy. But it is now time for HR to rise. And shine.

Ref: Sheetal Srivastava

The Economic Downturn Means That Hiring Freezes Will Soon Decimate Recruiting

Whenever there is a downturn in economic conditions, one of the first knee-jerk reactions that many CFOs and senior managers take is placing a freeze on all hiring, pay raises, budgets, and promotions.

The effect of long-term hiring freezes is particularly damaging to the recruiting function, because "no hiring" generally means that a majority of recruiters will be laid off. Historically, budgets for recruiting have been cut so low that the function is literally decimated, making it rather difficult for companies to resurrect a decent function when the economy swings up.

Many executives think that the decision to institute some sort of resource freeze is one that helps the organization because it contains costs; however, the opposite is more often the case.

Poorly thought-out freezes that impact talent acquisition and other talent-management activities may actually harm the organization by:

• Driving increases or vacancies in revenue producing/impacting roles that decrease revenues beyond any cost savings.
• Driving increases in employee burnout/turnover.
• Missing out on new talent opportunities (i.e., not be able to hire a superstar that becomes available).
• Decreasing an organization' s capability/capacity to innovate.
• Damaging the employer brand making hiring more difficult when the economy returns.

Rather than waiting for the inevitable announcement of a freeze, recruiters need to be proactive and preempt any such silliness long before it occurs by making the business case for leveraging this time to re-architect the talent acquisition function, upgrade its strategic programs, and trade up the talent population while salaries and vendor costs can be negotiated down significantly.
(Incidentally, you can tell when a hiring freeze is imminent because they are almost always preceded by the infamous "paper clip memo" from the CFO, which limits the purchase of office supplies, magazine subscriptions, and travel).

Because every organization is unique, there is no one magic way to structure the business case, but I have put together a list of arguments that you can select from:

A) Negative impacts on revenue and costs

Obviously, not expanding your staff or keeping open positions vacant can save payroll dollars in the short term. However, such savings may actually present a false reality because freezes have many other unintended consequences that CFOs often fail to account for:

1. Lost revenue. Across-the-board hiring freezes mean that critical revenue-generating and revenue-impact positions go unfilled. Obviously, when there is no one in a revenue-generating position, there is a lost opportunity to generate revenue every day that the position remains vacant.
2. Customer impacts. Frozen budgets and understaffing can stretch your employees. This means that other employees must now do double duty because replacements can't be hired. This may also impact quality and send a message to your customers that your firm is slipping as constrained employees sidestep process elements and cut corners. Both can negatively impact your product brand and future sales.
3. A limit on growth. Within most large firms, even during tough times some businesses units are growing, while others are shrinking. By freezing hiring "across the board," you negatively impact your rapid growth and top revenue generating divisions. This limits their ability to continue to grow. In global firms, some regions are likely to be growing despite the downturn and an overall freeze will threaten your competitive position.
4. Headcount replacements are expensive. In the end, few hiring freezes actually end up saving money because budgeted headcount employees are often just replaced with consultants, temps, interns, and other "off the book" spending. In some cases, these alternative consultants and workers are actually more expensive than regular employees, leading to a situation where overall "labor costs" don't go down at all. Facing employee shortages, some managers increase the use of overtime in order to get the work done, but at time and a half, this solution is relatively expensive.

B) Retention impacts

1. Frustrated employee turnover. Freezing resources means stagnation, and when opportunities are limited, they are likely to seek employment elsewhere. Freezing pay, promotions, travel, and/or training can also limit employee growth and learning, which will also increase turnover, if not immediately, at the first sign of opportunity.
2. It encourages your competitors. Hiring freezes are visible to outsiders on your website and the news of their existence spreads rapidly. These freezes send a message to your competitors that you are "weak" and struggling. This may cause them to increase their efforts to recruit away your employees and more often than not, your customers.
3. Freezing deadwood. Unfortunately, not being able to fill vacant positions causes managers to slow down or even cease their efforts to get rid of their deadwood employees. "Carrying" these low performers leads to lower productivity overall, but also weakens your managers by not forcing them to confront low performers. It gives managers an excuse not to make tough people decisions, which may also eventually weaken their decision making in product areas also.
4. Freezes frustrate "idle" recruiters. The best recruiters you are able to keep on your staff will invariably get rusty during hiring freezes. Having idle recruiters is a waste of money but it can also foster turnover among your recruiters who love action.

C) Missing out on talent opportunities

1. Exceptional talent. Across-the-board hiring freezes mean that when a few exceptional individuals like "Tiger Woods" enter the talent market, you will not be able to consider them. As a result, you'll miss out on exceptional talent who could really make an impact. If your firm doesn't capture this exceptional talent, other firms will.
2. Off-cycle recruiting. During tough economic times, both the amount and the quality of available talent will greatly exceed the available talent during boom times. Because during lean times, few firms are hiring, there is minimal competition. Together this means that a firm can now successfully attract experienced and college hires that their weak employment brand, pay rates or location wouldn't normally allow.
3. Weakened recruiting capability. Extended hiring freezes invariably weaken the recruiting function. This loss of recruiting capability can impact the business because the remaining recruiting staff won't have the ability to successfully recruit and land "in demand" candidates for the few positions that do become open.

D) Reduced innovation and technological capability

1. Reduced innovation. Budget freezes in particular can rob your innovators of the resources that they need to innovate, just as hiring freezes prevent you from recruiting new innovators. As a result, the rate of process and product innovation may decrease significantly during hiring freeze. In addition, freezing promotions and pay increases may limit your innovators motivation and willingness to be creative.
2. Impacts on technology. Because technology is constantly evolving and improving, hiring and budget freezes will directly limit your ability to attract new technologists and the needed new technologies.

E) Additional negative impacts of freezes

1. Employment brand impact. It signals a stoppage in a firm's growth, which can impact your firm's employment brand as a great place to work. This can make future recruiting more difficult and expensive.
2. Stock price impact. A freeze sends a message to analysts, customers, suppliers, and employees that your firm is not in a growth mode. Long or frequent "pauses" in recruiting may also send a stronger message that the company is in trouble, which could further hurt the stock price, which is likely lower anyway as a result of the weak economy.
3. Recovery time. Hiring freezes often mean that the recruiting function will be decimated. The function cannot be rebuilt overnight after the freezes are lifted. Many managers wrongfully assume that recruiting is a pure production function, one which you can put money into today and get results out tomorrow. While recruiting truly is a production function, it often requires significant ramp-up time, which many organizations fail to plan for. Refilling the "talent pipeline" with candidates after a freeze might take months, which can end up making the freeze last even longer than intended. In addition, "exploding out of the box" when the economy improves will also be more difficult.
4. Excessive early spending. Anticipating freezes often encourages hiring managers to hire "a bunch" of people early (whether they are needed or not). They do this in order to avoid "losing" the positions later in the year when hiring and budget freezes are generally introduced. In the same light, rumors of possible freezes can make managers and HR paranoid and to do "immediate panic" hiring the moment they hear a rumor about an upcoming freeze. They might also make rush decisions during a current hiring process, in order to complete it prior to the institution of a forthcoming hiring freeze.
5. Lower referral rates. Freezes may cause employees to hesitate before making referrals. They are hesitant partly because budget, promotion and pay freezes make the organization a less desirable place to work but also because a freeze may make their efforts fruitless because it diminishes the chances that their referrals will soon be hired.
6. More time spent on administration. Most across-the-board freezes are really not true freezes. Top managers almost always leave "exceptions" open. As a result, they don't really "stop" hiring, they just slow requisition approvals and make them more painful to get approved. A large amount of a managers (and HR's) time is wasted "getting around" these freezes and justifying "exceptions. " It can also give managers a bad taste for hiring of any kind, which may result in managers not devoting much time to the hiring process once the regular hiring process returns.

Action Steps
Rather than instituting across-the-board freezes, educate managers about the different options they have for cutting costs and increasing revenues:

• Focus on budget dollars. When it is important to slow down expenditures, it is often better to do it through budget control (controlling dollars) rather than through a hiring freeze or headcount tracking. In addition, always look at the revenue impacts whenever costs are cut.
• Increase internal movement. Managers need to increase the impact of their current employees by developing plans to transfer people internally from low return areas to those with higher return.
• Use incentives. Managers should consider offering short-term incentives to employees for increasing productivity or for reducing costs. Employees are often better equipped to judge where costs can be cut with minimal impact on productivity.
• Prioritize positions. If a manager decides to use a hiring freeze, they should limit the freeze to pre-identified non-key positions. Otherwise, a vacancy in a critical job can cause a significant loss in revenue and negate the projected cost savings from the hiring freeze.
• Demand metrics. If freezes are used, track metrics to determine whether overall costs are actually reduced by the freeze.
• Performance management. Managers should be encouraged to periodically fire low performing employees first, before seeking replacements.
• Rapid growth divisions. These critical regions or business units should be exempt from across-the-board freezes.
• Continuous churn. The new realities of talent management and business are that the old pattern of resource freezes and then layoffs needs to be broken. In a global economy, where firms need to be fast and agile, the new model is for firms to simultaneously hire and release workers in different areas. Smart managers must learn to continually add workers in areas of growth and innovation, while continually redeploying or releasing workers in areas of low ROI.
  

Final Thoughts

Any review of history will reveal that the majority of wealth in modern civilizations is more often than not created during times of significant economic crisis.

Opportunities abound for those organizations that are truly strategic, but as we all know, lots of people talk about being strategic but few really are. Now is the time for talent management to step up and proactively re-engineer antiquated practices and programs, and to embed talent management activities throughout core business processes while the organization can accommodate change.

If you wait until things are moving fast once again, you won't have time to be strategic; you'll be too busy catching up!

Ref: John Sullivan

Opportunity in adversity

Staying afloat
In a time when most are feeling the tremors of the global financial meltdown, there are a handful of Indian sectors that are still staying afloat. “If you look at sectors like insurance, healthcare, engineering, you will notice that they are still growing in volumes and value,” notes Ajay Soni, business leader - talent and organisation consulting, Hewitt.

What perhaps is keeping sectors like insurance afloat is the consumer mindset and attitudes. “Unlike developed economies like the USA, savings is in our DNA. In tough times we save even more for the future,” explains N.S. Kannan, executive director, ICICI Prudential Life Insurance.
Industry experts are optimistic and are expecting the private life insurance industry to grow at a 30 per cent rate by FY ’09. “Since core of life insurance is long term savings and protection, these times with sensex crashing will not affect investors’ decisions,” Kannan reasons. “Customer focuses on long term objective and invests over a time period,” he adds. ICICI Prudential has reportedly witnessed 31 per cent growth in its new businesses and 90 per cent growth through renewal premium business in the last six months. “We’ve expanded phenomenally in the last 18-24 months and our bulk expansion has been in the last 6-8 months,” says Kannan.

In fact, from a branch network of 580 offices in FY’07, I-Pru now has 2,055 branches across the country. “We continue to recruit managers and advisory manpower for these new branches that we’ve set up,” Kannan adds.

Sectors galore
Insurance sector is playing an interesting role in the current downmarket scenario. The life insurance industry has pumped in a huge amount in the equity markets. “Firms like ours and other life insurers have been net buyers even in such volatile times," informs Kannan.

Then, there’s healthcare which is also reportedly doing better than most other sectors. “The global financial turmoil has not brought about any major upheavals in the biotech arena,” says Chirag Mehta, head, strategic planning and development, Intas Biopharmaceuticals. Intas Biopharmaceuticals has seen a 100 per cent growth in the FY '07-'08 and is expecting the same for the current fiscal year. “We are on track to achieve this. Our performance this year and in the remaining quarters would be in line with our expectations,” Mehta points out. “We do not see any major business plan change for the near future,” he adds.

This perhaps also implies no major change in the hiring strategy. “We have added over 15 per cent to our manpower base during the last quarter and the trend for the subsequent quarter would remain unchanged,” confirms Dr. Kashmira Pagdiwalla, director, HR operations, Intas Biopharmaceuticals. Elaborating on the areas of healthcare where major hiring is happening, Dr. Pagdiwalla says, “The talent need is growing in the areas of research, manufacturing, marketing and corporate roles.” Of course, these are sectors that aren’t connected to the meltdown. However, even the services sector which has been adversely hit by the recession has pockets of growth. “In the services sector, Telecom is adding to the customer base and reporting continual growth,” Soni points out. One such example is Airtel which has grown at a 30 per cent rate from the last quarter.The way ahead

Soni, like other industry watchers, believes that the way forward is to set the house in order and use this time to create a strong DNA of managing organisation. “This time offers an option of looking at long-term and not just quarterly performances,” asserts Soni. “Forward looking organisations would build themselves for the long term,” he adds.

To put it simply, it’s an opportunity for managers to reflect on their business strategies and plan for contingencies.

Ref: Times Ascent