Human beings are rational creatures. But rationality does not necessarily mean being right. We are easily swayed by the latest trends and fashions without understanding our own need and affordability. Over the last couple of years, industry has been rife with discussions on best practices and world class policies and practices. As the world gets smaller with internet connectivity, information is easily available to all. Employees of an organization compare internal policies and practices with external benchmarks. Globalization also, makes it necessary for organizations to adapt and adopt global practices.
In the midst of all this ‘’informative noise’’, have you ever stepped back to really understand whether all change that globalization has brought along is really right or necessary? Are we all victims of the infamous information paradox today? When we compare two organizations and their respective policies and practices, are we also being fair and rational to both organizations?
If you were in the management function which decides on employee perks and benefits, how would you prioritize the need of employees? There are several kinds of benefits and perks that companies offer their employees. We all want them but the main question is – Do we NEED them? Do we really know what our needs really are? Or are we using industry benchmarks as an excuse?
Having worked across various different types of organizations, I was curious to find out what we as employees really need. But to provide any logical answers, I needed facts first. Hence, I decided to evaluate the gym and indoor sports facilities at 4 different organizations. The surprising find was that across all organizations, when a gym or indoor sports zone was inaugurated, the first month saw a large number of regular members. Over a period that number reduced. During the second year, the weekly turnout of employees at these employee facilities is reduced to less than 15 unique people with only 7 to 8 regular members. This applies to site locations too where a large number of employees live in corporate townships and have a 9 to 5 working period. Even here,, the average monthly turnout of unique members is not more than 25. This essentially means that only 2 to 5 percent of employees use the facilities available to them.
Don’t get me wrong. The point here is not about low utilization or cost to company. But as HR we really must understand what our employees really need. Is it a challenging job or better teams or work life balance or retiral benefits or healthcare facilities? Everyone has a different need personally. But what will be the best fit for both the employee and the organization? That is the question which needs to be answered.
As HR we also need to play the role of a strategic partner to our business leaders. Imagine sitting at a strategy meeting and pitching your case for employee benefits. With these numbers at your disposal, would your pitch be about employee needs or cost to company?
In this article, we will try to explore a few points and discuss why it is necessary to be different. Every organization is different. They have different strategic focus areas and markets to operate in. The people needs of these organizations too will therefore, be different.
Organizations just like people need to evolve and adapt to moving trends. However, what trends are right for the organization and what are not will make sense only if employees truly understand the needs of the organization.
When everyone talks of thinking outside the “box”, perhaps, we should begin our thinking by clearly understanding the box. What does our organization do? What are our organizations values and goals? What are our challenges and what are our strengths? Understanding the organization well, will help us understand why certain policies and practices are designed the way they are.
Typically, there are three types of strategic focus for organizations –
1. Organizations that focus on Customer Centricity
2. Organizations that focus on Product Leadership
3. Organizations that focus on Operational Effectiveness
The needs of each of these organizations are different. An organization cannot and should not focus on all three areas unless it wants to fail. Let us understand why and see a few examples.
Customer Centric Organizations
Organizations that focus on Customer Centricity always put customers first. Whether it is the way their product is packaged or the way their employees treat customers, the customer is always the king. Typically, industries such as hospitality, IT services, FMCG goods, BPOs, eCommerce etc are customer centric in nature. Organizations operating in this space, have to design internal policies and processes in such a way that their employees are empowered to take care of customers. From giving discounts to customers to spending large amounts on customer research, to going out of the way to customize a user experience, these organizations design processes keeping the customer in mind always. The focus of these organizations is to make sure a customer keeps coming back to them again and again. Such organizations spend a lot on employee trainings that focus on customer service at the junior levels and marketing and sales competencies at the senior levels. They do not look for the top talent in a college because the organization does not need it.
For example, at the Ritz Carlton in London, every employee and staff inside the hotel can spend up to one thousand pounds to address any emergency customer needs without taking any permissions or approvals. A housekeeping attendant once realized that a guest had forgotten their laptop in the room and had left for America. The attendant got in touch with the guest directly, took their mailing address and shipped the laptop to America at a cost of five hundred pounds. This is the level of customer centricity which makes the Ritz stand out from its competitors.
TCS for example never hires toppers in a college. They focus on the average to above average merit since a regular churn in employee population is healthy and necessary for the organization.
The needs of such organizations and its employees are a strong reward and recognition (rnr) system. Every employee needs to feel valued and empowered in order to provide the best customer service to their customers and clients.
But getting the right rnr system is a challenge and many organizations have failed too. For example in the US, a departmental clothing store MACY’s decided to offer free Nachos at the company cafeteria for a week to a high performer. Employees were offended for two reasons—
1. The reward showed no individual appreciation.
2. Employees who were diabetic or health conscious, could not avail the reward.
Individual contribution and team feeling is the need of such organizations and its employees.
Product Leadership Organizations
An Apple iphone or a Bose speaker is premium product. If a customer wants the best product in the market, they know where to go. Unlike Samsung or HTC, an Apple does not have hundreds of different models available in the market. Similarly, a Rolls Royce or Porche and Ferrari do not advertise their products like the Ford or Honda or Toyota etc. A premium product is the USP of these organizations. The customers that these organizations target are those who are willing to pay a premium for the best product.
Product Leadership Organizations spend millions of dollars on research and development of their product. Everything these companies do are focused on the product that they produce. Hence, all activity inside the organization is focused to making the best product. These organizations have employees as their focus. Their source of revenue is the specialized talent pool inside their company. All internal policies and processes are designed to ensure that employees are happy and do not leave the company in favour of other competitors. They target premium institutions to attract the best talent in the market. They go to extraordinary lengths to make an employee feel comfortable inside the organization such as by offering luxurious offices and workspaces to amazing food and other perks.
However, during the 1980s General Motors, which was a leading car manufacturer in the US went wrong with its people policies. At a bankers and investors meeting, three top executives of GM travelled from the same office to the same meeting in three different private jets even though the company was on the verge of bankruptcy. The employees were completely disconnected from the needs of the organization. GM was saved due to governmental assistance but has never been able to buy back investor and customer confidence as before.
At Google engaging and motivating employees is a continuous work in progress since there are no sure shot answers. In such organizations the factors that determine employee attitudes AND work behaviour have less to do with what the company does than who they are and their existing values.
Product leadership organizations need to value their employees for their merit. However, it needs to be finely balanced and is an extremely tricky job.
Operational Effectiveness Organizations
Large scale manufacturing, financial institutions, heavy metal industries, logistics and monopolistic industries have two things in common. Their product or service is fixed and they are capital intensive industries. A steel manufacturer cannot manufacture copper and aluminium too. The railways cannot make their trains fly during the rainy season. Banks cannot offer outlandish interest rates as they are controlled by a central regulator. A shipping company cannot offer festival discounts on client shipments.
The amount of investment necessary for an organization in these industries is enormous. The only things that make these industries competitive, is the speed and the cost at which they operate. The faster a bank processes loan applications; the better will be the user experience. The cheaper the ticket and faster a train, the greater will be the number of repeat customers on that route. They lower the cost of steel, the higher is your number of repeat orders. These organizations make profits from volume of sales. Hence, they not only have to focus on low cost but also on speed of delivery.
All processes and systems in such organizations will only focus on these two aspects - Reducing operational costs and adopting the best systems and processes.
In such organizations the people requirement are of three types. Such organizations are usually people intensive in nature. A large number of employees are required at the junior levels who are skilled in a specific discipline. This skilled workforce is required to perform routine tasks on a daily basis. The second kind of people required are those at the mid to senior managerial level, who are good people managers and have a fair degree of technical knowledge. At the very top, such organizations need to be lean and have only a few candidates who are strategic thinkers and can interact with external stakeholders with ease. Everything in such organizations is about achieving effectiveness in all aspects of its operations. Hence, all perks and benefits must be designed in such a manner that it benefits all different groups of employees. Such organizations will fail if they try to individualize or personalize benefits and perks for its employees.
Being Different
From the above descriptions, you may have understood that every organization can have only one strategic focus. A conflict in the focus or focus on multiple areas is the death knell for an organization and history has plenty of proof for the same. We are sure, that you may have understood what Adani Power needs to focus on as an organization from the above description of organizational focus.
It takes courage to be different and even more courage to accept the differences.
Comparing ourselves with others is easy but understanding what we really need is a big challenge. The relation between an organization and its employees is a mutual one. Just as an organization is responsible for the well being of its employees, the employees are responsible for understanding the organization’s goals and its needs and perform accordingly. A conflict in either will cause stress for both the employee and the organization. When employees and the organization are aligned, they can create magic together. Instead of looking outward at external best practices, such organizations can create industry benchmarks for others to follow. Where do you want to be - An onlooker from the outside or a game changer from inside?
You decide.
In the midst of all this ‘’informative noise’’, have you ever stepped back to really understand whether all change that globalization has brought along is really right or necessary? Are we all victims of the infamous information paradox today? When we compare two organizations and their respective policies and practices, are we also being fair and rational to both organizations?
If you were in the management function which decides on employee perks and benefits, how would you prioritize the need of employees? There are several kinds of benefits and perks that companies offer their employees. We all want them but the main question is – Do we NEED them? Do we really know what our needs really are? Or are we using industry benchmarks as an excuse?
Having worked across various different types of organizations, I was curious to find out what we as employees really need. But to provide any logical answers, I needed facts first. Hence, I decided to evaluate the gym and indoor sports facilities at 4 different organizations. The surprising find was that across all organizations, when a gym or indoor sports zone was inaugurated, the first month saw a large number of regular members. Over a period that number reduced. During the second year, the weekly turnout of employees at these employee facilities is reduced to less than 15 unique people with only 7 to 8 regular members. This applies to site locations too where a large number of employees live in corporate townships and have a 9 to 5 working period. Even here,, the average monthly turnout of unique members is not more than 25. This essentially means that only 2 to 5 percent of employees use the facilities available to them.
Don’t get me wrong. The point here is not about low utilization or cost to company. But as HR we really must understand what our employees really need. Is it a challenging job or better teams or work life balance or retiral benefits or healthcare facilities? Everyone has a different need personally. But what will be the best fit for both the employee and the organization? That is the question which needs to be answered.
As HR we also need to play the role of a strategic partner to our business leaders. Imagine sitting at a strategy meeting and pitching your case for employee benefits. With these numbers at your disposal, would your pitch be about employee needs or cost to company?
In this article, we will try to explore a few points and discuss why it is necessary to be different. Every organization is different. They have different strategic focus areas and markets to operate in. The people needs of these organizations too will therefore, be different.
Organizations just like people need to evolve and adapt to moving trends. However, what trends are right for the organization and what are not will make sense only if employees truly understand the needs of the organization.
When everyone talks of thinking outside the “box”, perhaps, we should begin our thinking by clearly understanding the box. What does our organization do? What are our organizations values and goals? What are our challenges and what are our strengths? Understanding the organization well, will help us understand why certain policies and practices are designed the way they are.
Typically, there are three types of strategic focus for organizations –
1. Organizations that focus on Customer Centricity
2. Organizations that focus on Product Leadership
3. Organizations that focus on Operational Effectiveness
The needs of each of these organizations are different. An organization cannot and should not focus on all three areas unless it wants to fail. Let us understand why and see a few examples.
Customer Centric Organizations
Organizations that focus on Customer Centricity always put customers first. Whether it is the way their product is packaged or the way their employees treat customers, the customer is always the king. Typically, industries such as hospitality, IT services, FMCG goods, BPOs, eCommerce etc are customer centric in nature. Organizations operating in this space, have to design internal policies and processes in such a way that their employees are empowered to take care of customers. From giving discounts to customers to spending large amounts on customer research, to going out of the way to customize a user experience, these organizations design processes keeping the customer in mind always. The focus of these organizations is to make sure a customer keeps coming back to them again and again. Such organizations spend a lot on employee trainings that focus on customer service at the junior levels and marketing and sales competencies at the senior levels. They do not look for the top talent in a college because the organization does not need it.
For example, at the Ritz Carlton in London, every employee and staff inside the hotel can spend up to one thousand pounds to address any emergency customer needs without taking any permissions or approvals. A housekeeping attendant once realized that a guest had forgotten their laptop in the room and had left for America. The attendant got in touch with the guest directly, took their mailing address and shipped the laptop to America at a cost of five hundred pounds. This is the level of customer centricity which makes the Ritz stand out from its competitors.
TCS for example never hires toppers in a college. They focus on the average to above average merit since a regular churn in employee population is healthy and necessary for the organization.
The needs of such organizations and its employees are a strong reward and recognition (rnr) system. Every employee needs to feel valued and empowered in order to provide the best customer service to their customers and clients.
But getting the right rnr system is a challenge and many organizations have failed too. For example in the US, a departmental clothing store MACY’s decided to offer free Nachos at the company cafeteria for a week to a high performer. Employees were offended for two reasons—
1. The reward showed no individual appreciation.
2. Employees who were diabetic or health conscious, could not avail the reward.
Individual contribution and team feeling is the need of such organizations and its employees.
Product Leadership Organizations
An Apple iphone or a Bose speaker is premium product. If a customer wants the best product in the market, they know where to go. Unlike Samsung or HTC, an Apple does not have hundreds of different models available in the market. Similarly, a Rolls Royce or Porche and Ferrari do not advertise their products like the Ford or Honda or Toyota etc. A premium product is the USP of these organizations. The customers that these organizations target are those who are willing to pay a premium for the best product.
Product Leadership Organizations spend millions of dollars on research and development of their product. Everything these companies do are focused on the product that they produce. Hence, all activity inside the organization is focused to making the best product. These organizations have employees as their focus. Their source of revenue is the specialized talent pool inside their company. All internal policies and processes are designed to ensure that employees are happy and do not leave the company in favour of other competitors. They target premium institutions to attract the best talent in the market. They go to extraordinary lengths to make an employee feel comfortable inside the organization such as by offering luxurious offices and workspaces to amazing food and other perks.
However, during the 1980s General Motors, which was a leading car manufacturer in the US went wrong with its people policies. At a bankers and investors meeting, three top executives of GM travelled from the same office to the same meeting in three different private jets even though the company was on the verge of bankruptcy. The employees were completely disconnected from the needs of the organization. GM was saved due to governmental assistance but has never been able to buy back investor and customer confidence as before.
At Google engaging and motivating employees is a continuous work in progress since there are no sure shot answers. In such organizations the factors that determine employee attitudes AND work behaviour have less to do with what the company does than who they are and their existing values.
Product leadership organizations need to value their employees for their merit. However, it needs to be finely balanced and is an extremely tricky job.
Operational Effectiveness Organizations
Large scale manufacturing, financial institutions, heavy metal industries, logistics and monopolistic industries have two things in common. Their product or service is fixed and they are capital intensive industries. A steel manufacturer cannot manufacture copper and aluminium too. The railways cannot make their trains fly during the rainy season. Banks cannot offer outlandish interest rates as they are controlled by a central regulator. A shipping company cannot offer festival discounts on client shipments.
The amount of investment necessary for an organization in these industries is enormous. The only things that make these industries competitive, is the speed and the cost at which they operate. The faster a bank processes loan applications; the better will be the user experience. The cheaper the ticket and faster a train, the greater will be the number of repeat customers on that route. They lower the cost of steel, the higher is your number of repeat orders. These organizations make profits from volume of sales. Hence, they not only have to focus on low cost but also on speed of delivery.
All processes and systems in such organizations will only focus on these two aspects - Reducing operational costs and adopting the best systems and processes.
In such organizations the people requirement are of three types. Such organizations are usually people intensive in nature. A large number of employees are required at the junior levels who are skilled in a specific discipline. This skilled workforce is required to perform routine tasks on a daily basis. The second kind of people required are those at the mid to senior managerial level, who are good people managers and have a fair degree of technical knowledge. At the very top, such organizations need to be lean and have only a few candidates who are strategic thinkers and can interact with external stakeholders with ease. Everything in such organizations is about achieving effectiveness in all aspects of its operations. Hence, all perks and benefits must be designed in such a manner that it benefits all different groups of employees. Such organizations will fail if they try to individualize or personalize benefits and perks for its employees.
Being Different
From the above descriptions, you may have understood that every organization can have only one strategic focus. A conflict in the focus or focus on multiple areas is the death knell for an organization and history has plenty of proof for the same. We are sure, that you may have understood what Adani Power needs to focus on as an organization from the above description of organizational focus.
It takes courage to be different and even more courage to accept the differences.
Comparing ourselves with others is easy but understanding what we really need is a big challenge. The relation between an organization and its employees is a mutual one. Just as an organization is responsible for the well being of its employees, the employees are responsible for understanding the organization’s goals and its needs and perform accordingly. A conflict in either will cause stress for both the employee and the organization. When employees and the organization are aligned, they can create magic together. Instead of looking outward at external best practices, such organizations can create industry benchmarks for others to follow. Where do you want to be - An onlooker from the outside or a game changer from inside?
You decide.
Posts
No comments:
Post a Comment