The contexts in which human resources are managed in
today's organizations are constantly, changing.
No longer do firms utilize one set of manufacturing
processes, employ a homogeneous group of loyal
employees for long periods of time or develop one set way
of structuring how work is done and
supervisory responsibility is assigned. Continuous changes
in who organizations employ and what these
employees do require HR practices and systems that are well
conceived and effectively implemented to
ensure high performance and continued success.
1. Automated technologies nowadays require more technically
trained employees possessing multifarious
skills to repair, adjust or improve existing processes. The
firms can't expect these employees (Gen X
employees, possessing superior technical knowledge and
skills, whose attitudes and perceptions toward
work are significantly different from those of their
predecessor organizations: like greater self control,
less interest in job security; no expectations of long term
employment; greater participation urge in work
activities, demanding opportunities for personal growth and
creativity) to stay on without attractive
compensation packages and novel reward schemes.
2. Technology driven companies are led by project teams,
possessing diverse skills, experience and
expertise. Flexible and dynamic organizational structures
are needed to take care of the expectations of
managers, technicians and analysts who combine their
skills, expertise and experience to meet changing
customer needs and competitive pressures.
3. Cost cutting efforts have led to the decimation of
unwanted layers in organizational hierarchy in recent
times. This, in turn, has brought in the problem of
managing plateau employees whose careers seem to
have been hit by the delivering process. Organizations are,
therefore, made to find alternative career paths
for such employees.
Examination Paper Semester I: Human Resource Management
IIBM Institute of Business Management
4. Both young and old workers, these days, have values and
attitudes that stress less loyalty to the
company and more loyalty to oneself and one's career than
those shown by employees in the past,
Organizations, therefore, have to devise appropriate HR
policies and strategies so as to prevent the flight
of talented employees
Question
1. Discuss that technological breakthrough has brought a
radical changes in HRM
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Answer / syed danish ahsan
One technological breakthrough, the use of online social networking as part of an employee profile and review process of a potential applicant for a position, has transformed how employer perception has evolved. Since items that are posted on the web are issues of what amounts to be public record, it is something that has altered how potential applicants for positions are viewed. For example, provocative pictures, images of questionable judgment, as well as the images that individuals choose to project are ones that can alter how prospective employees are seen. I think that this has transformed both the applicant process and how individuals are seen. This is an element of technology that has fostered both more vigilance in individual behavior as well as their perception on the part of employers. In this forum, technology has greatly changed individual perception and the reality that accompanies it.
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Case let 1 Trust them with knee-jerk reactions," said Vikram Koshy, CEO, Delta Software India, as he looked at the quarterly report of Top Line Securities, a well-known equity research firm. The firm had announced a downgrade of Delta, a company listed both on Indian bourses and the NASDAQ. The reason? "One out of every six development engineers in the company is likely to be benched during the remaining part of the year." Three analysts from Top Line had spent some time at Delta three weeks ago. Koshy and his team had explained how benching was no different from the problems of excess inventory, idle time, and surplus capacity that firms in the manufacturing sector face on a regular basis, "Delta has witnessed a scorching pace of 30 per cent growth during the last five years in a row," Koshy had said, "What is happening is a corrective phase." But, evidently, the analysts were unconvinced. Why Bench? Clients suddenly decide to cut back on IT spends Project mix gets skewed, affecting work allocation Employee productivity is set to fall, creating slack working conditions. High degree of job specialization leads to redundancy What are the options? Quickly cut costs in areas which are non-core look for learning’s from the manufacturing sector Focus on alternative markets like Europe and Japan Move into products, where margins are better. Of course, the Top Line report went on to cite several other "signals," as it said: the rate of annual hike in salaries at Delta would come down to 5 per cent (from between 20 and 30 per cent last year); the entry-level intake of engineers from campuses in June 2001, would decline to 5 per cent (unlike the traditional 30 per cent addition to manpower every year); and earnings for the next two years could dip by between 10 and 12 per cent. And the loftiest of them all: "The meltdown at Nasdaq is unlikely to reverse in the near future." "Some of the signals are no doubt valid. And ominous," said Koshy, addressing his A-Team, which had assembled for the routine morning meeting. "But, clearly, everyone is reading too much into this business of benching. In fact, benching is one of the many options that our principals in the US have been pursuing as part of cutting costs right since September, 2000. They are also expanding the share of off-shore jobs. Five of our principals have confirmed that they would outsource more from Delta in India-which is likely to hike their billings by about 30 per cent. At one level, this is an opportunity for us. At another, of course, I am not sure if we should be jubilant, because they have asked for a 25-30 per cent cut in billing rates. Our margins will take a hit, unless we cut costs and improve productivity." "Productivity is clearly a matter of priority now," said Vivek Varadan, Vice-President (Operations). "If you consider benching as a non-earning mode, we do have large patches of it at Delta. As you are aware, it has not been easy to secure 70 per cent utilization of our manpower, even in normal times. I think we need to look at why we have 30 per cent bench before examining how to turn it into an asset." "There are several reasons," remarked Achyut Patwardhan, Vice-President (HR). "And a lot of it has to do with the nature of our business, which is more project-driven than product-driven. When you are managing a number of overseas and domestic projects simultaneously, as we do at Delta, people tend to go on the bench. They wait, as they complete one project, and are assigned the next. There are problems of coordination between projects, related to the logistics of moving people and resources from one customer to another. In fact, I am fine-tuning our monthly manpower utilization report to provide a breakup of bench costs into Examination Paper Semester I: Human Resource Management IIBM Institute of Business Management specifics-leave period, training programmes, travel time, buffers, acclimatization period et al." "It would be worthwhile following the business model used by US principal Techno Inc," said Aveek Mohanty, Director (Finance). "The company has a pipeline of projects, but it does not manage project by project. What it does is to slice each project into what it calls 'activities'. For example, communication networking; user interface development; scheduling of processes are activities common to all projects. People move from one project to another. It is somewhat like the Activity Based Costing. It throws up the bench time straightaway, which helps us control costs and revenue better." "I also think we should reduce our dependence on projects and move into products," said Praveen Kumar, Director (Marketing). "That is where the opportunity for brand building lies. In fact, now is the time to get our technology guys involved in marketing. Multiskilling helps reduce the bench time." "Benching has an analogy in the manufacturing sector," said Girish Shahane, Vice-President (Services). "We could look for learning's there. Many firms have adopted Just-In-Time (JIT) inventory as part of eliminating idle time. It would be worthwhile exploring the possibility of JIT. But the real learning lies in standardization of work. It is linked to what Mohanty said about managing by activities." "At a broader level, I see several other opportunities," said Koshy, "We can fill in the space vacated by US firms and move up the value chain. But before we do so, Delta should consolidate its position as the premier outsourcing centre. Since there are only two ways in which we can generate revenue-sell expertise or sell products-we should move towards a mix of both. Tie-ups with global majors will help. Now is the time to look beyond the US and strike alliances with firms in Europe- and also Japan-as part of developing new products for global markets." Questions 1. Should benching be a matter of concern at Delta? 2. What are the risks involved in moving from a project- centric mode to a mix of projects and products?
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