Tuesday, September 30, 2008

Hiring the young

Hiring the young

I read this in times ascent....

Believe it or not, a young workforce in the retail space seems to be the mantra for most retailers. The average age of staff at Cinemax India and Koutons is 25 and 30 at Levi Strauss. Several retail brands are relying on young honchos to steer their businesses in a market where getting skilled resources is a serious challenge.

Organised retail in India is still in the nascent stages. The retail industry really came into its full being post the IT revolution making it in essence the youngest industry. “Most retail companies cater to the age group of 15–45. It makes perfect sense to pick up young honchos who find it easier to customise services to this target audience,” notes Kishore Bhatija, CEO, Inorbit Malls.

Another major reason is the fact that there is no history of learning for organised retail in India. The obvious option in such a scenario is to handpick talent at a young age and groom them for the future, an option most new players are taking,” adds Bhatija.

Interestingly, the average age of employees in retail companies is a lot lower than in other sectors. “The average age is far lesser in retail owing to the lower levels of expertise and a comparatively vast boom. It is mandatory for retailers to go for youngsters as they are an enthusiastic lot, willing to learn and project positivity,” asserts Devang Sampat, the 27-year-old senior VP of Cinemax India.

“Organised retail in India has been around for 12 years but the visibility and opportunities have emerged over the last four years. Hence, the industry experience and talent is limited. The average age of employees appears lower also because lifestyle categories have been the oldest, visible organised retailers, and these draw younger workforce who are willing to take up newer/emerging opportunities,” opines Shobha Wilson Simon, director, human resources, Levi Strauss India.

It is believed that the demand for young blood due to their high levels of energy and enthusiasm are key requirements to be a part of this industry. “Young individuals are open to experiment and can add healthy competitiveness to the business. It is always advisable to recruit young blood and mould them rather than search for skilled staff with mindsets,” says Sampat.

Monica Oswal, in her early thirties, is the executive director of Monte Carlo. She says, “For a fast growing sector like retail, a major chunk of the population is below 25. Their out-of-the-box mindset, dynamism, energy and ability to adapt are surely the key factors, which brings them under the spotlight.”

But it’s not all hunky-dory and there are certain pre-requisites that one must possess to get in. “What is important is to have people with the right attitude and those who are ready to take on challenges, and are at the same time adaptable to work in a structured environment,” asserts Bhatija.

Growing at a rapid pace, the biggest challenge that lies ahead for this industry is meeting the obvious demand supply gap. Add to this the task of finding the quality of leaders. Unlike telecom, financial services and other large industries, retail has nurtured talent in pockets to overcome this hurdle. “Retail organisations will continue to and must invest in training. The larger players are encouraging certification/education/building equity for retail careers which must continue,” Simon points out.

Going forward, Industry experts recommend benchmarking the compensation levels and upgrading the reward structure from time to time.

Why HR managers have to be tech savvy?

More and more Indian companies have begun to take advantage of information and communication technologies in carrying out their HR functions.
While IT/ITeS companies are in the forefront of this trend, companies from different manufacturing and service sectors are increasingly doing so eveyday. This article is a report on the extent of technology spread in the HR departments of Indian companies and why HR managers have to become increasingly aware of technology trends in their profession.
A “recent report”:

in Express Computer points out that by offering more and more cost-effective applications and solutions for HR departments, IT vendors are making the lives of HR managers and executives much easier. This is the primary reason why organizations are continuously strengthening their HR departments with updated IT solutions.
IT platforms free HR professionals from being mere book-keepers of labour statistics. They provide them with an opportunity to play a key role in organizational renewal and revitalization, the report says quoting H Venkatesan, Senior Vice-president, Global Human Resource, ISGN.
Employee data must be stored somewhere, and even if personnel files are held in paper form, certain data is always held electronically, the report says. Small organizations may hold employee data in spreadsheet form while larger organizations may implement enterprise-wide systems that do far more than just hold employee data. They can be put to multi-purpose use like providing employees with Web-based self-service access to HR, managing recruitment of new staff, using to underpin performance management and much more, the report points out.
No wonder that even as far back as 2002 many Indian companies had switched to what are called Human Resource Management Systems (HRMS). By now the list must have grown manifold. It is, however, illuminating to take a look at what one observer found out about “HRMS in Indian companies”:
http://www.expressitpeople.com/20020415/cover1.shtml as far back as 2002.

While IT/ITeS companies took the lead in implementing HRMS in Indian companies, companies in non-IT sector have not been slow to climb the IT bandwagon.
Among the first Indian companies to go for an HRMS was TCS. TCS started off by launching its digital HR Information System, which allows an individual to apply for leave, get online approvals, file for loans directly and voice grievances. TCS, employee benefits also included Visa Information Processing System (for checking visa status) and maintenance of the Branch Assets library on the company's intranet by the HR department. Today, TCS’s HRMS includes performance management and succession planning among other things.
Some of the non-IT companies which took the lead in implementing HRMS were Maruti Udyog, Glaxo SmithKline Beecham, Hero Honda, Samsung, SAIL, and Dabur to name a few.For instance, Glaxo Smithkline Beecham Consumer Healthcare, started off with an Training Management System, which takes care of the training requirements of employees and helps HR in planning and monitoring various learning modules as also a comprehensive payroll system that manages salaries/loans/PF, etc, for all employees.
The new technology enabled the company to conduct online employee satisfaction surveys. Today the company claims to have a full-fledged Human Resources Management System (HRMS) that has automated all HR processes (from recruitment to retirement). The system covers such processes as recruitment, appraisal, training, compensation, benefits, employee profile and retirement. The company's intranet also provides several HR-related services such as e-learning modules, HR policies, online facilities (booking guest house/meeting rooms), telephone directory, holiday list, etc.By the end of 2003, most large Indian companies automated their HR function (by implementation of ERP) and moved from the an HR Information System and to a more interactive and knowledge-based HR system. This has enabled an employee to become self-sufficient and have direct communication with the concerned authority.
All this is making eHR and B2E (business to employee) obvious steps in an organization's development path. While eHR plays a key role in helping medium and small-scale companies to gain a Web-based HR advantage, B2E helps in enhancing the relationship between an employee and an employer. Today, more and more companies are treating their employees as their internal customers and working towards fulfilling employee needs. For this reason, HRMS and People Management Systems (PMS) are increasingly gaining importance.
Why are organizations suddenly feeling the need to implement IT in their HR departments? The reasons vary. While in case of IT companies employees are key assets, the non-IT sector has also realized the growing need to invest in technology to upscale their HR functions. Besides time and cost saving advantages, it also has the long-term benefit of retaining employees. Compared to earlier times, organizations today are keen to understand and know the details of their employees and keep a tab on the latest developments in their personal life, so that they can provide the best bargains to these internal customers. Also, HR can focus on its real job of helping employees develop and help them perform better.
Even then Indian companies are way behind their North American counterparts. Although most Indian businesses, including SMBs, today have some sort of HRMS in place, the majority of them still treat them more as information systems rather than as people development systems or in-house knowledge development systems.
But the pressures of competition are forcing top managements to look at HRMS solutions that can positively improve profitability and bring long term gains. The premise that an HRMS needs to work towards making the HR department administratively more efficient no longer holds valid. It needs to impact the bottom line - today and in the future. Companies have started realising this in the last couple of years, with the result that “RoI calculation on HRMS”:
is fast becoming a standard practice in many companies.Today more and more companies are in the process of evolving set standards for calculating the return on their investments into HRMS. For instance, vMoksha has already outlined the cost savings that it expects from the following HRMS processes after implementation: eBenefits (80 percent savings); eDevelopment (73 percent); eProfile (77 percent); eRecruit (33 percent); eCompensation Manager Desktop (59 percent); eProfile Manager Desktop (71 percent); eRecruit Manager Desktop (70 percent). The cost savings have been calculated based on the self-service costs vis a vis manual costs.
While RoI is a definite indication of an implementation̢۪s success, all benefits cannot be quantified. And the consideration of unquantifiable and subjective benefits will start gaining ground, moving into the future, as companies have already started seeking benefits other than cost savings, like empowering their employees at large as well as HR in meeting the larger business objectives. This is already being reflected in the long-term benefits being outlined by the companies.
Some of the long-term benefits that are being sought by companies are an single administrative point for organisational structures across all e-HR applications, lower cost of ownership, improved performance monitoring systems and thereby improved productivity, low ratio of recruiters to staff and better placement of new staff (lower attrition).
Thus, with HRMS applications increasingly graduating from mere information systems to those that have a large positive impact on productivity, innovation, new product development, talent retention, talent and knowledge management and, of course, revenues and margins, the writing on the wall is clear: adopt intelligent HRMS’ and smart PMS’ or perish!

Monday, September 29, 2008

Booz, Parthenon set up consultancies in India

Booz, Parthenon set up consultancies in India

The Economic Times: September 29, 2008

Mumbai: The collapse of some of the biggest names in investment banking has rattled global financial markets. India has been no exception and in what can be termed an interesting scenario, large consultancy outfits are now seeing the need to be in India.

From the point of view of the consultants, India is not just a representative market. In case of Booz and Co, the newest entrant, it intends to have a 12-member team. The senior members will primarily be of Indian origin and have had the experience of working in their overseas offices.

While Booz will initially start operations with a dozen consultants, the plan is to expand to 100 people in a couple of years. Booz, as part of its global restructuring exercise, had moved out of India in 2000.

Things are a lot different today. "Global companies are using the Indian model in various businesses. This is in countries like Africa and other developing economies," says Suvojoy Sengupta, head of India operations, Booz and Co.

Globally, Booz has 3,300 people in its 57 office in 30 countries. "With India expected to grow at 7% per annum, companies are serious about India," he adds. Apart from sectors such as telecom, energy and healthcare, Booz sees opportunities in other areas like supply-chain management. The global presence has its own advantages.

Recently, when a Delhi-based corporate asked for a proposal, Booz was able to get six vertical specialists from 5 different countries in two days. It is expected that the top team at Booz, comprising mainly people of Indian origin, is relocating to India from the offices in the US and UK. Globally, Booz clocks revenue of $1 bn.

Another strategic consultancy firm Parthenon has set up shop in India early this year. It relocated Chip Greene, an expat, to head the Asian operations in India. Today, the size of the team has increased to 15. The firm's Mumbai office has already started servicing clients in China, Japan and Thailand. Parthenon has a different model of accepting fees.

"At times, we are given a portion of our fees in the form of stock or options. The valuation is simple for companies whose shares are traded. When the company is privately held, we fall back on traditional option pricing models," says Chip Greene, partner and Asia head, Parthenon group.

For India, the time has come when its success in various industries can be replicated in other countries. That's exactly what is happening as consultants are looking to make a name here.

Financial Meltdown and HCM Software investments

Came accros this one..

Financial Meltdown and HCM Software investments

We all read it, two iconic US banks going down in a matter of few days !!!
Does this kind of Financial meltdown signals warning to the HCM Software market ? Is it temporary ? These are some of the questions which are floating on other blogs too.

First of all, the kind of globalisation we are all part of, there is virtually nothing that can go without an impact. So if there is a shakeup in US, tremors are virtually felt across the world.
This is also true for the coming crisis, which due to the nature of inclusion to the global economy would impact revenues and therefore investments.
I am not an investment advisor, nor am i intending to play that role, but here is what I see as the future of the industry which banks on HCM Software.

1. Organizations would try to be more careful in their choice and justification of need of HCM Software. One prime reason I see this happening is, HCM is an area which has more intangible ROI associated with it and therefore it would be difficult to justify investments.

2. Organizations would definitely look at a long term investment and ROI too. This is likely to bring more focussed investments in long term, stable options rather than investing in a small term player.

3. Outsourcing could pick up as a result of this, organizations would see value in reducing their operative costs. This could also mean evaluation and availability of more options like managed services, BPO, Shared Service or SaaS.

4. I also see a trend towards addressing a requirement becoming the focus. This would mean that need based solutions like recruiting, learning management system, self service etc would be more in demand. Apart from addressing a specific need, such solutions are also easy to deploy.

5. Last but not the least, the organizations who have not invested in HR Software so far, may find a reason to wait. This would not apply globally and may not even be specific to an industry, but caution is the word where no experience exists.

To sum it up, its a time to refocus, rethink and reutilize the capabilities of the organizations to save cost, however not at the cost of automation. Because apart from being desirable HR automation today is a source of competitive advantage and its benefit in the medium to long term are there to see.
I personally also see this evaluation phase leading to better processes being identified to separate the haves from have nots. So organizations would be able to put in stringent measures in place to evaluate which software would actually be the best for them.

However a word of caution - Being Price conscious may bring down your investment worries however may not give you what you need. So invest but invest wisely.