I am sharing a very interesting article which I received in my mailbox.
Managing Talent - the HR Challenge by Hanif Kanjer
(the author is Director Business Development with a
company, based in the US, and is an alumnus of the
London Business School .
I was talking the other day with the VP-HR of a leading IT company based in Mumbai, and he was saying that every day he spends atleast three hours counseling employees who are de-motivated or who have
been made lucrative offers from competitors. For an organization that has
been losing rapidly its senior management, this is a matter of grave
One looks around, and the same picture of gloom is cast across most
organizations. As markets develop, the demand for good talent will always
remain high. Why would retaining talent be so difficult? Have Maslow s
theories of motivation lost their relevance in modern times?
Traditionally, the contract between employers and employees was that of job security in exchange for loyalty. But, that was the old economy, where
factors such as productivity, growth, competitiveness, etc. played
second-fiddle to loyalty . Long-service was rewarded as a virtue. There are
still some IT organizations that distribute long-service awards at their
annual function. It makes one wonder about the professional growth of an IT techie who has spent 25 years in the same organization performing the same functional role. How is such an individual geared to compete in a
fast-changing technological environment? What compounds the problem further is when these self-proclaimed experts crush the initiatives of fresh young talent because of their idiosyncrasies. They become obdurate with their experience, and are often unwilling to yield to new ideas and fresh blood.
Organizations regularly conduct climate surveys to understand their employee morale and motivation levels. However, often such
surveys lack the depth and sensitivity associated with these surveys. Results are either manipulated/misinterpreted resulting in a complete
waste of time. Senior management is either naïve or refuses to see the real picture, often looking for excuses to explain the drain.
Where does the problem lie? Or should I say begin? Non-competitive salaries, cultural misfit, unrealistic expectations, non-clarity
of performance parameters, unfocused/biased/myopic management, the
reasons are many.
The roots can be traced to the recruitment process. Often in their bid to
attract good talent, HR oversells the organization to the new recruit. There
is no harm is stretching the organization truths a little, but when they
stoops to blatant lies, that s when the organization takes the hardest fall.
For, it is easy to recruit good talent, but very difficult to retain them.
Especially, if the foundation of the relationship has been based on
misrepresentation of the truth. The new recruit feels cheated, and that s
sowing the seeds of self-centeredness. The employee starts fending for
himself. Loyalty be damned. Of course, HR executives can argue, till the
sheeps come home, that the onus is on the individual to investigate the
merits and demerits of the organization before making
the commitment. But, that s a fatalistic approach. In fact, the
responsibility should squarely fall on their shoulders. Take the example of an IT company that recruited a senior consultant, from Arthur Andersen, as a senior manager in business development. HR spectacularly failed in hiring this recruit. No doubt, they got the consultant on board, but albeit for the wrong role, and more significantly, they had not gauged the cultural mismatch.
From Arthur Andersen to a chaotic IT organization that had no systems/procedures, this was a major cultural shock for the consultant. An
excellent performer in his previous role as a consultant, he failed to live up to the expectations of him in the new company. His first day at work, he was shocked to find that this leading IT company did not have proper IT infrastructure, leave alone state-of-the-art technology for employees to use. And from there on it was downhill. His role was defined to make cold-calls to prospects in the US. For a consultant with 10 years experience this was a degradation of his experience and abilities. He could not motivate
himself to perform. A month later he was counseled by HR to learn to adapt to different environment. His reasoning was he was willing to adapt but not downgrade his standards. Ofcourse, this may be an extreme example, but nonetheless this is a true situation I have had the opportunity to witness at close quarters. Through much heartburn, the consultant finally decided to quit the organization a year later, depressed, de-motivated, and dejected. One would have thought that the management and HR would have learnt their lesson, but apparently
not. Their search is on for spectacularly bright candidates, the recruitment
process still works on misrepresentation of the truth, and one can easily
see the same sort of heartburns occurring.
As I mentioned earlier, while it is easier to get good people, it is very
difficult to retain them. The next challenge for both HR and the employee is to ensure that there is clarity in and communication of roles and
responsibilities. Often, roles are defined, however performance parameters are not. This ambiguity leads to confusion. Adding to
the woes are biased performance evaluation techniques, and
non-differentiation between the performers and non-performers. Biased performance evaluations are a big de-motivator because they shape the perceptions of peers/seniors in the organization. This is especially so when performance metrics are not objective. When performers and non-performers are meted out the same treatment, in terms of financial rewards, recognition, promotions, organizations run the highest risks of losing the performers. If I put in 14 hours of work, and am successful in sending out proposals on time, opening client doors, and my colleague who hasn t performed at all, doesn t work long hours, and both of us receive the same rewards, obviously I am going to be de-motivated. To counter this, one IT company is panning to introduce the McKinsey model of up or out in two years. On the face of it, definitely a progressive step in retaining good talent and rewarding performers. But when one investigates further, this IT company does not have the wherewithal to
measure performance without any bias. Without proper
techniques and clearly defined parameters, measuring performance will remain subjective, often based on likes and dislikes of the seniors measuring the performance. Worse, you cannot borrow just one tool/technique, in this case up or out , and ignore other aspects that support such a philosophy. Finally, having ill-structured compensation packets hammers the last nail in the coffin. One organization I have worked with has the most outrageous compensation structure that tries and matches the new recruits last drawn salary in the previous organization. So, you would find two colleagues in the same grade, performing the same job, and having the same performance
parameters, drawing widely disproportionate salaries. And in a bid to
outsmart the employees, the salaries are structured in a manner that in
effect freezes the employees salaries for a period of two years, with no
apparent increment in the gross package. This speaks
of the organizations ethics. If you don t have the philosophy of sharing,
and being fair to your employees, then you don t deserve good talent in the organization. Organizations have to realize that losing good talent
is like slowly bleeding to death. All the organization learning goes
out when a performing employee walks out. Just as it takes six times the
money and effort to replace an existing customer with a new customer, it
takes as much if not more in hiring a new employee. When a good employee leaves, it affects the morale of the other remaining employees, who are contemplating their worth in the organization. Are you mapping these risks? Don t mouth platitudes on your people policy. Make a commitment to fair and ethical practices with your employees, and you will mitigate your employee risks.