Recent trends in critical HR management practices

Nobel Prize-winning economist Gary S. Becker, who coined the term human capital, says thatthe basic resource in any company is the people. The most successful companies will be those that manage human capital in the most effective and efficient manner. The present day economy has been titled as Knowledge economy. In such an economy, it is people who make all the difference. In political economy capital or market was important. Talent occupies centre stage in the Indian workplace. In view of this, managing and retaining manpower is becoming crucial to an organizations success. To achieve this, companies across sectors are focusing on some of the more critical HR practices. Some of the trends that have been noticed are: Leadership development Creating a pipeline of leadership talent is key to a business future growth. It is imperative for the top level of an organization to make leadership talent management a priority, and put its money into longterm plans, as opposed to short-term ones. If companies are worried about their talent pipeline, they have to develop their people. Work-life balance No company or employee has found the Holy Grail of balancing work and life, but that is a work in progress. However, multinationals, information technology (IT) and IT enabled services (ITeS) companies have been able to promote the balance between career, family and leisure-time better. Other sectors have also been increasingly promoting a work-life balance. Interestingly, most companies in India use benefits such as flexible timings, telecommuting, crche facilities and concierge services as an attraction and retention strategy. Experts say companies should see the work-life balance as a business proposition since progressive companies carry business forward with employees and families. Inclusion and diversity With higher numbers of Gen Yers joining the workforce in India at a time when companies across the world have an ageing workforce on their rolls, conflicts are to be expected. Therefore, companies are investing both time and resources in ensuring that all age groups are comfortable working together. Organisations in India have also been focusing on making workplaces more representative. For companies such as ICICI Bank Ltd, Hindustan Unilever Ltd, Vedanta Resources, PepsiCo India, Shell

Companies in India and Bharti Airtel Ltd, gender diversity has become a critical area of focus. Health and wellness The work culture at globalized workplaces involves long working hours, frequent travel, multitasking and tight deadlines - and all this often leaves employees mentally and physically stressed. Companies have begun to realize that healthy employees contribute to higher efficiency and productivity. Apart from medical benefits, companies are also offering yoga classes and health camps and have doctors on campus.HCL Technologies Ltd, for instance, like many other IT companies, has 24/7 medical facilities in all its centres. DuPont has an Intranet-based tool, which assesses an employees health through a questionnaire and makes recommendations based on the scores. Right skilling Right skilling, or matching jobs with a particular level of training rather than hiring overskilled workers, is gaining currency. Companies use this strategy to tide over a manpower supply crunch and to broaden their talent baseApart from IT and ITeS firms, organizations in the banking and financial services sector, too, have been increasingly hiring graduates and training them. The upside? Lower attrition rates and wage costs. Pai explains that when you have an over-qualified employee, it is very difficult to meet her aspiration levels and, therefore, the chances of the employee moving on to something more challenging are higher. Managing solid citizens Organizations which neglect their solid citizens are doing this at their own peril, say experts. Unlike star performers who are potential leaders, and therefore more likely to move out of an organization faster, this group provides stability and bench strength to an organization. Experts say companies need to take a fresh look at solid citizens and invest time and resources in managing and developing this group. Instant rewards Recognizing and rewarding performers is one of the most effective tools to attract and retain the right talent. Companies in India are looking at rewards systems more seriously, and are adopting total rewards practices that include compensation in both cash and kind. Apart from lifestyle perquisites such as a house, a car or a club membership, profit-linked incentives, deferred gratuity, and wealth-building programmes in the form of stock options and soft loans, companies are also including work-life balance programmes; competency pay packages where niche skills are compensated; and career opportunities, such as overseas assignments, new projects, etc., to reward staff. These rewards can be tailored to suit the top performers aspirations to achieve maximum effect.

Measuring human capital: Evaluation of performance plays a key role, not just in rewarding an individual employee, but also in setting performance benchmarks. And hence, the need for a fair and transparent performance management system. A strong performance analysis helps make human resources both efficient and effective. Managing aspirations As aspirations of organizations grow, so do those of employees. And, with the changing lifestyles and profiles of the workforce, personal and professional aspirations of employees are not just varied, but are increasingly on the rise. Experts say people as well as organizations have aspirations, and when the two get aligned, achieving business goals becomes easier. Companies should be clear about goals of individuals as well as of the organization, and the role each needs to play. The firm should also communicate the goals, and have robust and reliable processes to execute them. 360 degrees feedback Finally, recognizing the need to make performance appraisal systems more effective, an increasing number of companies are using the 360 degrees or multi-rater feedback process. Unlike the traditional appraisal system, which gives unidimensional feedback, this one allows an employee to give feedback to her reporting manager, peers, direct reports and others. While most companies started using this system as a means for performance appraisal, most of them now use the 360 degrees feedback system to identify the learning and development needs of employees. Since companies are finally valuing people and their softer skills, does that make it easier to hire good people? The answer is no. In todays business climate, attracting and retaining the best employees is very difficult. The reason is a combination of the change in business practices and the shift in employee attitudes. The business landscape has changed dramatically in the past decade as a result of many factors from the feverish hiring boom of the 90s to the economic slowdown in the later part of the last decade. During this same period of time, employee attitudes have changed dramatically. Exposure to widespread layoffs and corporate scandals has led to an erosion of company loyalty and reevaluation of career and life priorities by many employees. So now we have companies looking to acquire the best talent and a growing workforce of talented individuals who are no longer attracted by compensation alone, but who require and value intangibles as well. The bottom line is this. In order to achieve professional growth and success in the next period of increased talent acquisition, technology professionals are going to have to step out of their comfort zone and develop the holistic, relationship-focused business skills that companies are requiring.

And by the same token, companies are going to have to take a more strategic and supportive approach to recruiting and retention if they want to find and keep the new breed of evolving talent.

Here are the 8 top HR trends to wach out for

BANGALORE: Deloitte India on Tuesday released its first annual "Human Capital Trends 2012" report titled, 'Leap ahead' which examines the broad impacts of eight trends that are reshaping both HR in the business - and the business of HR. Each year Deloitte begins with a wide range of potential topics, then work with clients, vendor teams, academics, analysts, and Deloitte practitioners to refine the list. These trends highlight the most potential business impact over the next 18 to 24 months. Deloitte also conducted its Inaugural India Talent Survey in collaboration with AIMA. The India Talent Survey 2012 helps in understanding the evolving perspective of talent - retention, corporate values, communications, leadership and what do employees think of their HR and talent functions. "As we move forward in 2012, many CEOs are facing a critical, dual imperative ie. to focus on enabling both their organization's overall growth agenda and on driving efficiency in the business of HR. This dual focus demands decisive action as the stakes are greater than ever" saidThiruvengadam P, Leader, Human Capital Advisory Services, Deloitte in India. He further opined that, "In this competitive world, CEOs today look at every advantage they can find to drive growth and they are of the firm belief that talent is a key enabler of growth. Leaders all over, have come to understand that people risks represent a significant area of potential exposure". The report identifies the top eight trends that will shape potential business impact globally over the next year. These are -In 2012, growth is job #1 - Growth is the top priority for many CEOs in 2012 with many organizations focusing on three key strategies: emerging markets, mergers and acquisitions (M&A), and innovation. -Operation globalization - Many companies around the world are moving to new global operating models, driven by the rapid rise of emerging and developing economies - both as customers and as sources of talent - and by continuing pressure to reduce costs. -Fast-track to the top - Developing the next generation of leaders to drive future growth.High-potential leaders must be able to operate on a global scale and adapt quickly to change. They also need the depth and breadth of skills and experience to work across converging industries. -People risk is risky business - in a world of low-probability events that have far-reaching impact and growing uncertainty, HR's role in managing enterprise risk is expanding Seeing around corners - Advanced tools are turning workforce data into powerful insights that help businesses navigate uncertainty.By capitalizing on the latest analytical tools and techniques, they are

improving acquisition, retention, and rewards; reducing labor costs; improving productivity and employee effectiveness; and managing risk more effectively. -#social #mobile @work - Social media and mobile devices are raising the bar on HR service delivery. HR has an opportunity to use social media and mobile tools to create communities for sharing knowledge and to support employees through direct, yet informal communication. -Clouds in the forecast - Cloud services are changing the way business operates, and HR has a key role in helping organizations adapt.Cloud computing is changing the way people and businesses work, upending conventional ideas about time-to-value, service levels, infrastructure needs, and more -Stay in front with an effective sales force - A multichannel environment is creating the need for a different kind of sales force.

The nature of Human Resource Management System is dynamic and widely fragmented which makes it difficult to follow a certain pattern of function. Due to the lack of any set rules and regulations to follow, it is obvious for the industry to face challenges considering its tremendous growth in the past few years. Expert research teams including industry players have made an approximation of 21% growth in last 4 years in India. Following are a few day-to-day challenges that HR industry is struggling to overcome:

Hesitation to outsource: Organizations continue to grow their business prospects, which lead to additional human chain and promotions and salary revisions. As projects pile up and organization face the changes and starts adapting to them, the workload exceeds all limits and there is genuine demand to outsource certain sections of work to an external expert service provider. Although outsourcing has become popular recently, still many companies need to break the barrier and bridge this gap by trusting the idea of outsourcing.

New roles of HR: The increasing pressure of clients, cost limits, productivity issues etc. demands high levels of talent. This cannot be accomplished by only hiring talented pool of employees from the market; there is a need to understand the implications of learning and development of employees to enhance the work output. HR no longer refers to just human resources and has become synonymous as an umbrella term for various other functions within the organization ranging from recruitment to finance, learning and development etc. The HR heads need to accept this challenge, gather knowledge and spread it in most effective way to various HR personnel in the company.

High attrition rate: Indian companies now have a global presence and many foreign investors have outsourced their business here because of the availability of talent at low costs. This has created many job opportunities and higher salary range especially in the IT and ITES sector. This has led to lower

loyalty levels and employees switch companies more often for better opportunities. This is one of the biggest challenges faced by HR, as they need to match their compensation figures with the industry and provide extra benefits to their employees to retain them for a longer period of time.

Managing Soft Skills issue: Employees are hired by their level of technical skills to match the work. However, as most clients are out of India, there is a need to cater to the diversity. This poses a challenge for the HR to find an employee who is talented as well as have decent soft skills to communicate with oversees clients.

These are a few of the many challenges faced by HR and addressing these is an even bigger challenge as every company has a unique structure.