CEOs must make HR more accountable now

Remember the famous opening lines of Dickens' classic 'A Tale of Two Cities'? Much like what Dickens saw in those turbulent times, India Inc is currently seeing 'an epoch of belief ' and at the same time an 'epoch of incredulity'.Inside our companies, we see similar volatility. One month of growth followed by another month of stagnation. Ask any of your sales people - irrespective of the sector you are in - and they will tell you of customers engaged and wanting to buy, but they are not sure the deal will close. You will see managers (in most sectors) moaning over the shortage of talent and skills but who cannot recruit, for there is an unofficial hiring freeze. Ask employees - they all think the job market has picked up a bit and yet, they can't switch jobs as easily as they used to.In such unpredictable times, CEOs must make new demands of the HR function. They must ask HR leaders to help managers, employees and others to cope with uncertainty and ambiguity in newer ways. CEOs will do well to first pause, notice and acknowledge that if times are unpredictable externally, they will be the same internally. So they need to distribute their time equally between handling external agencies (customer, regulatory, shareholders) and the most important internal constituency of their own managers and employees. This is where they must ask their HR leaders to renew employee engagement plans and do a reality check on what's happening on the ground. Chief executives must identify the inertia which usually takes over successful HR programmes,especially if they were crafted during 'good times'. 

Much of India Inc's HR functions are, of late, nicely-branded programmes - usually rehashes of the old welfare regimes. In unpredictable times, these oft-repeated gimmicks fail to fire the imagination of employees and leave them with a depressing deja vu. Unless CEOs demand more realistic and value-adding plans from HR, they will get more of the same. Here are three provocative actions CEOs could ask HR function to deliver in these unpredictable times. 

First, ask HR folks to measure everything they do. If they say, we recruit well, ask them how many of the new hires stayed in the company over two years. Ask if the cost per hire has come down over the past four quarters and at what rate. 

If your HR teams run induction and orientation programmes, ask them to measure their effectiveness in terms of reducing settling-in time of employees (measured as in new hire productivity). If you have been told you must approve budgets for a fun event, ask what the outcome will be. If you are told this will improve morale, ask how, and ask for proof. 

If CEOs engage the HR function to improve predictability of their programmes, it will reduce some degree of unpredictability that the volatile external environment has created.Second, in unpredictable times, your HR function must help you separate your men from your boys. You need to identify the 'long-term horses' (to borrow a phrase from Hindi) and do so 'objectively'. HR departmentsmust in current times re-tool themselves and show the mirror to the leaders. This is no time to hide the warts. 

Good and predictable times allow you the luxury of carrying some passengers. But in volatile times such as these, you will do well to have an HR leader who will tell you (again, objectively) who are the "horses" you should bet on. In the overall softness and socialistic hangover that afflicts most managers in our country, we see more milk of human kindness flowing out of HR departments. 

Used to the good times and believing their jobs create the feel-good in the company, HR departments don't often call a spade a spade. CEOs must ask for a fresh assessment of talent and demand heightened rigour from HR managers. 

The third is the need for building resilience in the company and the people. Ask if resilience is one of the desirable competencies in your company. Resilient people stay steady under pressure, and drawing upon huge resources of optimism, prod and persevere under the most difficult and ambiguous of circumstances. 

Resilient leaders not only cope with confusion but interpret the external environment to the employees in clearer terms. If you as a CEO see resilience in this light you will instantly recognise its immense value. So go ahead and ask your HR leaders to present a roadmap for building resilience in the company as a core competence - for the people and processes. 

We have often heard the adage: when the going gets tough, the tough get going. Intoxicated by a great run of growth, HR functions have not had time to toughen themselves. That is why you see so many cases of employee discontent boiling over. CEOs must demand a new toughness from the HR function. Caring must not be confused with pampering and HR functions must partner with CEOs in managing and defining expectations as opposed to merely catering to and appeasing. 

Well-grounded people engagement programmes with predictable outcomes will be chief executives' best bulwark against the current unpredictable external environment. 

Infosys defers joining dates of 1700 recruits

 Falling margins and an unplanned salary increase have pushed Infosys to embark on a major austerity drive. The details are not clear yet, but it certainly includes a freeze on business class air travel and deferment of joining dates of 17,000 campus recruits.

The IT major's CEO, S D Shibulal, has sent a mail to employees saying that the company's expenditure for the year had risen too high on account of its Lodestone acquisition and salary increase. The mail goes on to say that the cost-cutting measures would be implemented in a phased manner.

A company spokesperson said, "In a tough business environment, Infosys has decided to take certain cost optimization measures. These are necessary for the company to continue making strategic investments and afford the rollout of the compensation increase."

The joining dates for campus recruits have been deferred for three months from the date of joining that was communicated to them previously. Several people tweeted that their joining dates had been extended to February; some said April.

The Infosys spokesperson said the company would honour all campus offers. The company has introduced an online training programme to keep these new hires engaged till they formally start work. "The completion of this training will not only give these recruits a headstart in their career with Infosys, but also reduce their planned six months training programme at our Mysore campus by up to two months," the spokesperson said.

Anticipating a bevy of queries from thousands of campus recruits for specifics around the deferred joining dates, Infosys has set up an exclusive online chat line. "This will help us address additional queries from them and also help them gather details about our online training programme. This will be in addition to our personal communication and addressing queries through emails," the company said.

There's also a freeze on long-haul business class air travel by its senior executives, including the CEO. "Business class is a privilege available to senior leaders in the company for long haul travel. In our drive to optimize travel costs, the senior leadership has decided to lead by example and forgo this privilege," the company said.

Infosys's operating margin has been dropping consistently for several quarters now. In the quarter ended December 2011, it had a 31.2% operating margin, but this was down at 26.34% in the last quarter. The September quarter alone saw a surprisingly sharp fall of 166 basis points. The salary increase of 6% announced last month, which many believe was done under pressure because rivals had given increments earlier in the year, will increase margin pressures in the coming quarters. Infosys normally announces salary increases in April, but this year it did not do so citing uncertain business conditions.