Today we had Professor Atish Dasgupta speak to us about emerging trends in human resource management in India. Prof Dasgupta worked in manufacturing and construction for many years. He also spent 26 years in the IT industry where he was a software manager, writer, in sales, and finally HR. He started with some facts about India. Namaste which is a greeting for hello means “I bow to you”. The flag’s colors stand for many things. Orange or saffron stands for courage and sacrifice, while white stands for purity and truth. The green means faith, fertility, and chivalry. The wheel in the middle stands for each hour of the day, an endless circle of life.
As he stated there are many challenges in the service center, especially IT. This is because the industry is so large. Some of the challenges faced are attracting the right talent, developing talent in-house, and retaining talent. In India, a company may pick a candidate and everything will be on track but within the last days before the candidate starts work he/she will back out. There isn’t a contract the candidate signs because in Prof Dasgupta’s opinion it would scare people and they would have an even harder time finding the right candidate. Therefore, “romancing the candidate” plays a big role in making the candidate feel welcomed and needed. During this process the employer and candidate will get to know each other, the employer will reassure the candidate, and they will set goals for what is expected.
One part of HR in India that needs improvement is the recruitment process. Recruiters need to work on finding quality. The recruiters feel short on time so they rush the process and focus on the number of people instead of people who will be quality to the company. When recruiters get a lot of people they feel their job is complete even though the candidates may not have the necessary background or be right for the company.
There is a performance improvement plan for low performers that’s used by HR managers. The employer will work with the employees so they can improve. This will usually last around 3 months. Afterwards the employer will look at those who didn’t improve and figure out what to do with them. This could be rerunning the PIP for another 3 months or getting rid of the low performers.
When staffing a company resumes seek strong educational backgrounds. Employee referrals, which is learned from the U.S., is also looked at. There is succession planning and employee tests for entry level candidates related to the job. E-recruitment is also popular. www.naukri.com is India’s first e-portal which was established in 1998. Naukri means job. This would be like monster which is used in the U.S.. Newspapers are used to get candidates. This is different in the U.S. though because it will specify the age and gender for the job. During the interview, personal questions will be asked, such as marital status and family plans. This can hinder whether one will become employed. On paper it will not state the real reason, but the interviewer will find another reason on paper to not hire someone. Even U.S. companies that are here in India will ask these questions. Pictures are also taken because there have been interviews that were fraud, like telephone interviews.
Performance appraisals are also done. Cultural dimensions of collectivism and power distance make appraisals a challenge. Indians feel you are a part of a family, in turn creating a relationship. Loyalty is just as important as performance. Ratings are inflated due to personal relationships. Also, employment at will does not exist and termination carries a strong social stigma.
Compensation and benefits are also a little different. An employee will get rent, medical, and travel allowances for example. These benefits are a part of the total salary. Vacation time is also given which includes: 7 days of sick leave, 7 days of casual leave with a minimum of 2 days at a time with prior permission from boss, 3 weeks annual leave after 1 year of employment, and about 15-20 days for federal and state holidays. However, these benefits are becoming less.
Attrition is a huge challenge in the IT industry. About 14-20% of people quit within one year in a company. This counter plays collectivism. As explained by Prof Dasgupta, India has learned individualism from the U.S. so it also plays a role. High attrition creates a bench mark; people who aren’t working will replace those who quit.
Our other lecture was given by Mr. Hubert Reilard. He is from Germany and works for a company that specializes in induction heating. Induction heating is much more efficient than using a furnace since you do not need to heat all the space surrounding the metal. In Germany there are many medium businesses that are very good at one particular field. 80% of Germany’s GDP is from these businesses because these companies are world leaders in their field. They have double the patents than large businesses. Medium businesses have employed 1 million people within the last 10 years which is the complete opposite of large companies. Medium companies depend on the engagement of employees. They value their employees even when the economy is bad. Instead of laying off employees during low economic times they will find alternative ways to save money. These companies have a different set of values and roles.
Many companies started coming to India for cheap labor. However this is changing. Companies didn’t realize the different expenses needed to sustain a company here. For example the electric goes out a lot, as we have learned, so companies needed to buy generators. They also needed to invest in busses because the drive for some Indians was too long and the roads are very congested. Now, many companies are starting research centers. Indians are better at mathematics and theoretical thinking. In Mr. Reilard’s experience, the best way to work with business partners in India is to respect one another and not to look down on each other. To be a global company means having willingness to cooperate and not force culture on everybody. Moreover, it is better to play an active role in globalization than sit back and watch companies grow around you.
Some challenges in having a business in India is the infrastructure. Cars are not a solution to the transportation problem. Some people have to drive 3 ½ hours a day to go to work. Corruption, especially in the industrial field is also a challenge. From Mr. Reilard’s experience it is very easy to do business in Bangalore. You just need a product that sells. It does take time to solve issues but you just need to do it. Patience and having patient Indian colleagues is required. At first Mr. Reilard’s company had issues getting parts through customes because the numbers were different on documents. Now they know what is expected and have prepared documents the way customs like and they have no problem. There are 1000 German companies in India!
During the evening we spent some time talking to the representatives for the different majors at XIME. We learned that they put on activities for the juniors and it’s a way for the juniors to learn what they are good at so it’s easier for them to pick a field. Besides the difference between the sizes of our schools, the organizations are about the same. Afterwards, 3 of the students did some convincing and took us out to eat for dinner at a restaurant they usually hang out at. We tried chicken lollypops and a lot of other Indian foods. Afterwards, they insisted we try pawn which is beetle seeds and some spices wrapped in a beetle leaf. It tasted pretty minty and turns your tongue red. I think I can say for all of us, it is the most memorable experience so far.
-Jessica