Thursday, January 11, 2007
Overweight Employees Are Disadvantaged In The Workplace
www.personeltoday.com - 04 Jan' 07
If you had a few too many mince pies over Christmas then it may be time to get yourself down to the gym – evidence has emerged that being fat harms your career. A survey of Britain's bosses by consultancy The Aziz Corporation found that overweight people are disadvantaged in the workplace. Eight in 10 senior managers believe there is a prejudice in business against people who are seriously overweight. Seven in 10 believe that overweight people are seen as lacking self-control, energy and drive. And the same percentage says fit people are better able to cope with the stresses and demands of a senior business role. Aziz Corporation chairman professor Mr Khalid Aziz said: "This research reveals that appearance matters in business – and that weight is one of the key factors in appearance. "The competitive nature of business and securing a senior role means that appearance can be make or break.
If you had a few too many mince pies over Christmas then it may be time to get yourself down to the gym – evidence has emerged that being fat harms your career. A survey of Britain's bosses by consultancy The Aziz Corporation found that overweight people are disadvantaged in the workplace. Eight in 10 senior managers believe there is a prejudice in business against people who are seriously overweight. Seven in 10 believe that overweight people are seen as lacking self-control, energy and drive. And the same percentage says fit people are better able to cope with the stresses and demands of a senior business role. Aziz Corporation chairman professor Mr Khalid Aziz said: "This research reveals that appearance matters in business – and that weight is one of the key factors in appearance. "The competitive nature of business and securing a senior role means that appearance can be make or break.
Using Social Networking Sites For Hiring
The Economic Times, New Delhi Edition - 04 Jan' 07
Social networking is catching on websites like Orkut, Minglebox.com, MySpace and others are becoming informal hiring grounds. Examples range from IITians, IIM guys and sundry others putting up scraps to find venture partners, websites putting up messages in communities to work on-line to scraps for young journalists to join a publishing and consultancy firm. Scraps, for the uninitiated, are messages. Do they succeed? Ask Mr Govind and you will get an affirmation. He got his start-up partner through Orkut, an IITian who worked in Intel for three years. Besides, he got two engineers from the Indian School of Mines, Dhanbad. He has got seed funding of Rs 20 lakh from NirmaLabs and expects to start operations by April 2007. He hired 3-4 people to scrap about his new company, put them on people’s scrapbooks and not just on communities. And he got a decent response of 1,200 people, including freshers.
Social networking is catching on websites like Orkut, Minglebox.com, MySpace and others are becoming informal hiring grounds. Examples range from IITians, IIM guys and sundry others putting up scraps to find venture partners, websites putting up messages in communities to work on-line to scraps for young journalists to join a publishing and consultancy firm. Scraps, for the uninitiated, are messages. Do they succeed? Ask Mr Govind and you will get an affirmation. He got his start-up partner through Orkut, an IITian who worked in Intel for three years. Besides, he got two engineers from the Indian School of Mines, Dhanbad. He has got seed funding of Rs 20 lakh from NirmaLabs and expects to start operations by April 2007. He hired 3-4 people to scrap about his new company, put them on people’s scrapbooks and not just on communities. And he got a decent response of 1,200 people, including freshers.
Tuesday, January 09, 2007
No time for goodbyes at BPOs, Thanks!
Economic Times - 9th Jan 2007
Ritesh Dedhia, 24, still cannot get over that day in 2003. Working at a call centre, he found his seven-member team getting reduced to three overnight. For the next few days, his small team slogged and stretched to make up till replacements came on board.
Dedhia, now working with a Mumbai-based MNC recalls calling his 15-day-old colleagues to enquire about their absence. “We have quit,” he was bluntly told. And the reasons could not get more bizarre: “We handled technical calls for which engineering graduates are required”.
Two of them wanted to pursue a foreign masters degree and had joined the call centre to brush up their accent, as they were afraid of being rejected during the visa interview. For others, the job was just a time pass.
Easy job openings, desperate employers coupled with young workers and their frequent job-hopping is bringing in a new kind of casualness about jobs and resignations in corporate India. Absconding workers — workers who don’t resign, just disappear — are becoming common.
Resignations are losing their value. Some simply SMS and move on. Some do not even bother to inform. Some fall ill and never turn up. Submitting formal resignation letters is becoming rare. Serving notice period? Even rarer.
So far, the trend has been largely limited to the sizzling $7-billion BPO industry that is growing at close to 40% annually. But as young workers make their presence felt elsewhere in the industry, this casualness is likely to spill over to other sectors.
Genpact senior VP (HR) Piyush Mehta says: “The challenge isn’t about technical skills — it’s about the dos and don’ts at work, which many of them don’t seem to realise.” At Genpact, at least 500 of the 6,000 employees turn into absconding workers. This is when the company says its attrition rates are lower than industry average.
The problem is understandable. For foot-loose young workers, their first jobs are normally about trying out new things for fun, specially when companies come knocking at their doors. And most do not care much about their reputation or things like provident funds, etc. Most just collect their salaries and vanish.
According to industry estimates, attrition in the first seven days of the month jumps to around 50% due to this factor. And desperate employers are only making things worse. The need to ramp up numbers quickly leaves companies with little time to carry out background checks.
Bangalore-based Ma Foi’s COO E Balaji says the problem surfaces at the entry level, where the profile consists of voice processes. The maximum attrition happens in the first two weeks of the candidate joining.
While many BPOs feel that serious punishment needs to be meted out to such people, others have a different take on the problem. “Before blaming such employees, we need to ask ourselves questions. When an employee wants to quit, he is asked innumerable questions during exit interviews. Further, the new company expects the person to join within 15 days.
This doesn’t give employees time to serve their notice period and they decide to leave the company without intimating HR or the concerned authorities,” explains 3Global director Sanjay Luthra.
There are other reasons too for the increase in job-hoppers. Some don’t like their profile or the process they are put into. Countrywide Financial CEO Vasu Ramaswami says, “There is a certain section of people working in the industry who switch jobs for reasons like petty salary hike or if their friends have joined some other companies.”
However, Mr Ramaswami adds that the most common reason is more money. The problem has accentuated as no action is taken against absconding workers. “Employees themselves don’t fear the repercussions of going away and attach low importance to accountability,” says Emmay HR COO Madhu Bhojwani.
Most companies don’t want to initiate legal action against such employees as they create a lot of mess, and there is too much effort required to track them down. Also, since these workers quit early, damage in terms of critical documents being passed on is relatively low.
There is no denying that such moves impact the work environment. “Trainers and managers feel frustrated with fewer resources. Less people reporting to work impacts the SLA adherence by companies and productivity of the organisation,” one source adds.
Not only this, quitting at frequent intervals also fuels the attrition rate of the industry. Companies say standardisation of certain processes will check this. Mr Ramaswami says, “There should be a rule that no recruit will be taken in a company until he submits his relieving letter from the previous organisation.”
Some companies are conducting psychometric tests to detect such people, but Mr Luthra feels there is a need to “get more aggressive on background checks.”
Ritesh Dedhia, 24, still cannot get over that day in 2003. Working at a call centre, he found his seven-member team getting reduced to three overnight. For the next few days, his small team slogged and stretched to make up till replacements came on board.
Dedhia, now working with a Mumbai-based MNC recalls calling his 15-day-old colleagues to enquire about their absence. “We have quit,” he was bluntly told. And the reasons could not get more bizarre: “We handled technical calls for which engineering graduates are required”.
Two of them wanted to pursue a foreign masters degree and had joined the call centre to brush up their accent, as they were afraid of being rejected during the visa interview. For others, the job was just a time pass.
Easy job openings, desperate employers coupled with young workers and their frequent job-hopping is bringing in a new kind of casualness about jobs and resignations in corporate India. Absconding workers — workers who don’t resign, just disappear — are becoming common.
Resignations are losing their value. Some simply SMS and move on. Some do not even bother to inform. Some fall ill and never turn up. Submitting formal resignation letters is becoming rare. Serving notice period? Even rarer.
So far, the trend has been largely limited to the sizzling $7-billion BPO industry that is growing at close to 40% annually. But as young workers make their presence felt elsewhere in the industry, this casualness is likely to spill over to other sectors.
Genpact senior VP (HR) Piyush Mehta says: “The challenge isn’t about technical skills — it’s about the dos and don’ts at work, which many of them don’t seem to realise.” At Genpact, at least 500 of the 6,000 employees turn into absconding workers. This is when the company says its attrition rates are lower than industry average.
The problem is understandable. For foot-loose young workers, their first jobs are normally about trying out new things for fun, specially when companies come knocking at their doors. And most do not care much about their reputation or things like provident funds, etc. Most just collect their salaries and vanish.
According to industry estimates, attrition in the first seven days of the month jumps to around 50% due to this factor. And desperate employers are only making things worse. The need to ramp up numbers quickly leaves companies with little time to carry out background checks.
Bangalore-based Ma Foi’s COO E Balaji says the problem surfaces at the entry level, where the profile consists of voice processes. The maximum attrition happens in the first two weeks of the candidate joining.
While many BPOs feel that serious punishment needs to be meted out to such people, others have a different take on the problem. “Before blaming such employees, we need to ask ourselves questions. When an employee wants to quit, he is asked innumerable questions during exit interviews. Further, the new company expects the person to join within 15 days.
This doesn’t give employees time to serve their notice period and they decide to leave the company without intimating HR or the concerned authorities,” explains 3Global director Sanjay Luthra.
There are other reasons too for the increase in job-hoppers. Some don’t like their profile or the process they are put into. Countrywide Financial CEO Vasu Ramaswami says, “There is a certain section of people working in the industry who switch jobs for reasons like petty salary hike or if their friends have joined some other companies.”
However, Mr Ramaswami adds that the most common reason is more money. The problem has accentuated as no action is taken against absconding workers. “Employees themselves don’t fear the repercussions of going away and attach low importance to accountability,” says Emmay HR COO Madhu Bhojwani.
Most companies don’t want to initiate legal action against such employees as they create a lot of mess, and there is too much effort required to track them down. Also, since these workers quit early, damage in terms of critical documents being passed on is relatively low.
There is no denying that such moves impact the work environment. “Trainers and managers feel frustrated with fewer resources. Less people reporting to work impacts the SLA adherence by companies and productivity of the organisation,” one source adds.
Not only this, quitting at frequent intervals also fuels the attrition rate of the industry. Companies say standardisation of certain processes will check this. Mr Ramaswami says, “There should be a rule that no recruit will be taken in a company until he submits his relieving letter from the previous organisation.”
Some companies are conducting psychometric tests to detect such people, but Mr Luthra feels there is a need to “get more aggressive on background checks.”
India Inc's big bosses moving on
Economic Times - 9th Jan 2007
India Inc’s most visible protagonists are moving out of the scene and the turf that has been their playground for years. Many honchos who had over the years become faces of their companies are moving on.
It must have been a strange feeling for LG India chief KR Kim to leave after eight years. Mr Kim, who seemed inseparable from LG India, had after all started it and made the company a market leader.
Pepsi India boss Rajeev Bakshi had been a regular face of the cola major and braved the challenge of pesticide allegation . He exited the Indian operation last month. So did Pulak Prasad, co-MD of Warburg Pincus, and CVL Srinivas, MD of Maxus India.
While the former shaped the PE firm’s fortunes in the country for more than eight years, the latter did so for the media agency for over six years. Santosh Desai, who turned Mc-Cann Erickson into a strategic planning powerhouse, made a hasty exit from the agency after more than eight years.
For most of these leaders, it was the next step in their career. While some were elevated, some others chose to follow their dreams. Mr Kim moved on within the company to take on higher responsibilities.
Pulak Prasad and Amit Chandra decided to turn entrepreneurs and launch funds of their own. Kumar Srilagi, an Intel Capital veteran, who joined NEA recently, joined other enterprises.
“It’s a function of a vibrant economy that is creating exciting ideas and opportunities. And these veterans, having built an ecosystem of relationships and credibility in the industry, see a world beyond their companies,” says Atul Vohra, managing partner, Transearch.
Analysts say it is an industry-wide phenomena that has spread across sectors ranging from consumer goods, investment banking to VC firms. “With explosion in the market, opportunities have been too compelling to even company veterans,” says K Sudarshan, managing partner, EMA Partners India.
Analysts point that in the VC and PE space, movement is not surprising. “People there leave within six-seven years, which is an average tenure of the fund. When funds exit an investee company, these VCs get hefty ‘carried interest’ and then it’s time to move on,” says an executive of a PE firm.
With the job market booming, many companies are witnessing quick horizontal and vertical movements, hence vacancies are being created. That has lead to movement even among the top talent. Companies are moving up top talent quickly to retain leadership and also create positions for the rung below.
India Inc’s most visible protagonists are moving out of the scene and the turf that has been their playground for years. Many honchos who had over the years become faces of their companies are moving on.
It must have been a strange feeling for LG India chief KR Kim to leave after eight years. Mr Kim, who seemed inseparable from LG India, had after all started it and made the company a market leader.
Pepsi India boss Rajeev Bakshi had been a regular face of the cola major and braved the challenge of pesticide allegation . He exited the Indian operation last month. So did Pulak Prasad, co-MD of Warburg Pincus, and CVL Srinivas, MD of Maxus India.
While the former shaped the PE firm’s fortunes in the country for more than eight years, the latter did so for the media agency for over six years. Santosh Desai, who turned Mc-Cann Erickson into a strategic planning powerhouse, made a hasty exit from the agency after more than eight years.
For most of these leaders, it was the next step in their career. While some were elevated, some others chose to follow their dreams. Mr Kim moved on within the company to take on higher responsibilities.
Pulak Prasad and Amit Chandra decided to turn entrepreneurs and launch funds of their own. Kumar Srilagi, an Intel Capital veteran, who joined NEA recently, joined other enterprises.
“It’s a function of a vibrant economy that is creating exciting ideas and opportunities. And these veterans, having built an ecosystem of relationships and credibility in the industry, see a world beyond their companies,” says Atul Vohra, managing partner, Transearch.
Analysts say it is an industry-wide phenomena that has spread across sectors ranging from consumer goods, investment banking to VC firms. “With explosion in the market, opportunities have been too compelling to even company veterans,” says K Sudarshan, managing partner, EMA Partners India.
Analysts point that in the VC and PE space, movement is not surprising. “People there leave within six-seven years, which is an average tenure of the fund. When funds exit an investee company, these VCs get hefty ‘carried interest’ and then it’s time to move on,” says an executive of a PE firm.
With the job market booming, many companies are witnessing quick horizontal and vertical movements, hence vacancies are being created. That has lead to movement even among the top talent. Companies are moving up top talent quickly to retain leadership and also create positions for the rung below.
They're talking crores with ESOPs
Economic Times - 9th Jan 2007
Hemant Bakshi is tired of saying ‘no’ to wealth managers. They pester this successful cement company executive to sell his employee stock option plan (Esop) shares; keeping all your eggs in one basket is risky, they say. Mr Bakshi does not buy that argument.
After all, this is the very basket that has grown to a value of Rs 2.5 crore at current prices. Soaring property prices can’t scare him off from buying a flat in Cuffe Parade if he wants to, nor are rising interest rates a worry for buying the best set of wheels money can buy, or if he is so inclined, to kick his job goodbye to smell the roses, write a book, whatever.
The stock market rally has not only turned company promoters into billionaires, but has also benefited employees, as their stock options have multiplied in value. The situation is a marked departure from the dotcom bust days of 2000 that left people holding worthless Esops. Perhaps that experience helped this time as companies have been relatively quiet about the wealth created for employees.
Mr Bakshi, who works for Gujarat Ambuja Cements, recently sold 2,000 shares netting a little less than Rs 3 lakh. That’s small change compared to his residual holding, 1,79,000 shares, with a market value of Rs 2.5 crore. Then, there is Rajeev Gurnani, who holds 63,000 Gujarat Ambuja shares with a market value Rs 1 crore. We have excluded board members here. So, these people are at the most senior company executives.
ACC’s employees have benefited from the rise in share prices of cement companies. Narayan Venkatkrishnan, a senior employee, has shares worth Rs 2 crore. Giving him company is Srinivas Reddy, who holds about 21,000 shares. As of January 5, 2007, these shares are worth Rs 2 crore.
The growing wealth of such employees and the effectiveness of Esops as a retention tool are inspiring large Indian business houses to follow suit. The most notable one in recent times is the Aditya Birla Group, which announced Esops for its major listed companies: Hindalco, Grasim Industries, Ultratech and Aditya Birla Nuvo.
The respective market cap of the Esops to be issued at current prices: Rs 618 crore, Rs 780 crore, Rs 423 crore and Rs 627 crore. These would be given over a period of time and would be exercised after a certain vesting period, so this is not money in the bank yet. But it gives an idea of the amount companies are willing to fork out. Peer pressure would be one element as employees grumble to HR about how their compatriots in other companies are raking it in.
Even otherwise, the Esop is an invaluable weapon in the fight to retain and attract talent, as long as the markets don’t give way. Private sector banks such as ICICI Bank and HDFC Bank have been using the Esop route to retain their best talent in a competitive market. Riaz Kasim is a chief manager with ICICI Bank, whose 5,670 shares are worth Rs 51 lakh.
Akash Pitambar can walk away with Rs 68 lakh, and there is Pradeep Kanabar, chief manager, holds Rs 1.1 crore worth of shares, Amar Sethi’s market worth is Rs 1.4 crore. Karan Malik, a general manager, holds 34,401 shares and Samir Pradhan hold shares worth Rs 3 crore each. Then there is Pooja Singh, senior GM, who holds shares worth Rs 9 crore. Giving her company is Aarti Sabnis who holds shares worth Rs 2.4 crore. ICICI Bank seems to have a large number of employees holding valuable share options, many of them crorepatis.
Note that these shares are not free and employees have to pay the exercise price on allotment. That can be at par, like Dabur, or connected to the price prevailing at the time of granting the option. In some cases, companies provide funding facilities through banks. Also, employees holding shares through earlier allotments can sell those shares at a profit and buy new ones. The bull rally in stock markets would mean shares bought 3-4 years ago would have appreciated handsomely. For example, Bharti Airtel recently announced some allotments under Esops at a price of Rs 221 per share.
Eligible employees will get the shares on which they are already making a gain of 187%, at its current price of Rs 636. IT companies have been typically the main issuers of options and stories abound about how engineering graduates who joined Infosys in its initial years are now millionaires. Even in the recent i-flex open offer from Oracle, the Indian company’s employees will walk away with fat sums as a result of the offer. But what is significant is that trend has spread to other sectors.
Dabur, for example, granted 54 lakh options during 2006, which will be allotted at par to its employees. They will be getting shares for one rupee each that are trading at Rs 150. That’s a rich picking by any standard. ITC and HLL are other large companies which have issued options. Marico has recently decided to issue Esops too of up to 5% of its equity capital. Divi’s Laboratories, Matrix Laboratories, Suzlon Energy and Lupin Laboratories have also issued options to their employees.
What has been presented here is just a glimpse of the wealth creation that has benefited employees of companies, who have been allotted shares through Esops. It does not include Esops that may have been given. Shares have not been allotted, either because they have not vested or the employees have not exercised the option yet. While employees who got options in 2003-05 have made it big, the big question facing employees in 2007 is whether they will be as fortunate.
(Names of people mentioned in the story have been changed to protect their identities)
Hemant Bakshi is tired of saying ‘no’ to wealth managers. They pester this successful cement company executive to sell his employee stock option plan (Esop) shares; keeping all your eggs in one basket is risky, they say. Mr Bakshi does not buy that argument.
After all, this is the very basket that has grown to a value of Rs 2.5 crore at current prices. Soaring property prices can’t scare him off from buying a flat in Cuffe Parade if he wants to, nor are rising interest rates a worry for buying the best set of wheels money can buy, or if he is so inclined, to kick his job goodbye to smell the roses, write a book, whatever.
The stock market rally has not only turned company promoters into billionaires, but has also benefited employees, as their stock options have multiplied in value. The situation is a marked departure from the dotcom bust days of 2000 that left people holding worthless Esops. Perhaps that experience helped this time as companies have been relatively quiet about the wealth created for employees.
Mr Bakshi, who works for Gujarat Ambuja Cements, recently sold 2,000 shares netting a little less than Rs 3 lakh. That’s small change compared to his residual holding, 1,79,000 shares, with a market value of Rs 2.5 crore. Then, there is Rajeev Gurnani, who holds 63,000 Gujarat Ambuja shares with a market value Rs 1 crore. We have excluded board members here. So, these people are at the most senior company executives.
ACC’s employees have benefited from the rise in share prices of cement companies. Narayan Venkatkrishnan, a senior employee, has shares worth Rs 2 crore. Giving him company is Srinivas Reddy, who holds about 21,000 shares. As of January 5, 2007, these shares are worth Rs 2 crore.
The growing wealth of such employees and the effectiveness of Esops as a retention tool are inspiring large Indian business houses to follow suit. The most notable one in recent times is the Aditya Birla Group, which announced Esops for its major listed companies: Hindalco, Grasim Industries, Ultratech and Aditya Birla Nuvo.
The respective market cap of the Esops to be issued at current prices: Rs 618 crore, Rs 780 crore, Rs 423 crore and Rs 627 crore. These would be given over a period of time and would be exercised after a certain vesting period, so this is not money in the bank yet. But it gives an idea of the amount companies are willing to fork out. Peer pressure would be one element as employees grumble to HR about how their compatriots in other companies are raking it in.
Even otherwise, the Esop is an invaluable weapon in the fight to retain and attract talent, as long as the markets don’t give way. Private sector banks such as ICICI Bank and HDFC Bank have been using the Esop route to retain their best talent in a competitive market. Riaz Kasim is a chief manager with ICICI Bank, whose 5,670 shares are worth Rs 51 lakh.
Akash Pitambar can walk away with Rs 68 lakh, and there is Pradeep Kanabar, chief manager, holds Rs 1.1 crore worth of shares, Amar Sethi’s market worth is Rs 1.4 crore. Karan Malik, a general manager, holds 34,401 shares and Samir Pradhan hold shares worth Rs 3 crore each. Then there is Pooja Singh, senior GM, who holds shares worth Rs 9 crore. Giving her company is Aarti Sabnis who holds shares worth Rs 2.4 crore. ICICI Bank seems to have a large number of employees holding valuable share options, many of them crorepatis.
Note that these shares are not free and employees have to pay the exercise price on allotment. That can be at par, like Dabur, or connected to the price prevailing at the time of granting the option. In some cases, companies provide funding facilities through banks. Also, employees holding shares through earlier allotments can sell those shares at a profit and buy new ones. The bull rally in stock markets would mean shares bought 3-4 years ago would have appreciated handsomely. For example, Bharti Airtel recently announced some allotments under Esops at a price of Rs 221 per share.
Eligible employees will get the shares on which they are already making a gain of 187%, at its current price of Rs 636. IT companies have been typically the main issuers of options and stories abound about how engineering graduates who joined Infosys in its initial years are now millionaires. Even in the recent i-flex open offer from Oracle, the Indian company’s employees will walk away with fat sums as a result of the offer. But what is significant is that trend has spread to other sectors.
Dabur, for example, granted 54 lakh options during 2006, which will be allotted at par to its employees. They will be getting shares for one rupee each that are trading at Rs 150. That’s a rich picking by any standard. ITC and HLL are other large companies which have issued options. Marico has recently decided to issue Esops too of up to 5% of its equity capital. Divi’s Laboratories, Matrix Laboratories, Suzlon Energy and Lupin Laboratories have also issued options to their employees.
What has been presented here is just a glimpse of the wealth creation that has benefited employees of companies, who have been allotted shares through Esops. It does not include Esops that may have been given. Shares have not been allotted, either because they have not vested or the employees have not exercised the option yet. While employees who got options in 2003-05 have made it big, the big question facing employees in 2007 is whether they will be as fortunate.
(Names of people mentioned in the story have been changed to protect their identities)
In pursuit of the right talent
Business Line - 9th Jan 2007
The incumbent must experience the joining process, not as mere signing of certain documents such as the PF etc. While these are certainly essential, the incumbent should experience it in totality, right form the time he\she entered the office, greeted by the security, received by the HR and conducted into the company — the whole range of experience should have a human touch.
While in the previous decades the real crunch for industry was that of resources (read cash). now it is the problem of finding and retaining talented employees.
While the HR Department has to wade through a massive, often redundant data-base of prospective employees, the typical haystack syndrome results — inability to get talented (easily convertible to revenue) people on board.
The limited talent available is being attracted by too many employers. So much so, the alacrity with which the applicants apply is not reflected in offers being taken up by them.
Offers are made but the incumbents do not join. The reasons are not difficult to glean. One can blame it on the wide variety of choices available.
Today, there are plenty of job offers and prospective employees have the time to wait, and pick and choose the most lucrative offer.
Indecision seems to be a deliberate ploy of the job-seekers. There is no worry like "if I do not join now, I may miss the bus", as there are many other buses which he or she can board.
An employer's antenna perks up when the prospective employee suddenly becomes incommunicado. Hitherto, the communication channels used were the telephone and, at times, even personal visits. Now, an e-mail greets you on a Monday morning that he is having some health problems and may be joining after a while (date not specified).
And then, he does not turn up for induction, either at the corporate office or at the project site. He asks for more information, mostly irrelevant, such as about the city, its weather, etc.
He also sounds inquisitive or sceptical about the company's future projections.
How to tackle this situation?
Always keep the communication channels open. Clear all the stumbling blocks. Communicate with the would-be employee promptly. This sets at rest doubts that the employee may be having about your company and any second thoughts about joining.
The results of an interview process are: Selected, rejected or on hold. Do not hold on to the `hold list' for too long; communicate rejects with a polite mail immediately. Similarly, communicate quickly to those who are selected.
Now, for those who are short-listed, constant communication is a must. Invite them and take them around the company. This will make it easier for them to arrive at a decision.
Most short-listed applicants are concerned about the notice period they are supposed to serve. Depending on the company's policy, include the pay in lieu of the notice as a one-time component at the time of joining. This will make the applicant feel good.
Another feel-good factor is: Honour the commitments of joining bonus, designation, etc. Recruitment of experienced and senior-level professionals needs more delicate handling. When these experienced personnel join, ensure that a senior member of the organisation welcomes them personally This will take care of protocol issues.
When it comes to monetary compensation, make it employee-friendly. Do not camouflage the actual payment. Most employees are interested in take-home pay.
A well-drafted compensation package is a better takeaway for an employee. Make clear which allowances are taxable and tax-free and what actually goes into the account of the employee at the end of the month.
Expectation setting
Make an honest pitch about onsite posting, designation, etc. These need deft handling. For example, one may say that an onsite posting is subject to the candidature being cleared by the client.
One may have occupied a high post, say vice-president, in a small company. A similar designation may not be accorded in a large organisation, as there are more management layers.
To improve the joining ratio, corporates might announce a small one-time bonus if the incumbent joins on the date agreed to. This could be in the form of a gift coupon. The incumbent must have a wholesome joining experience — right from the way he is greeted by the security, received by the HR and conducted into the company.
On the day of joining, conduct an interactive induction into the company and let most of the complying with formalities be handled virtually. A professionally done induction ensures that the incumbent does not feel lost in the new milieu.
Joining is an assortment of experiences. At each level of interaction, always exude warmth and give the incumbent a feeling of being wanted. Share the future plans and allay his apprehensions.
When the incumbent is circumspect about the future, share with him the strides made so far by the organisation and that it is forward-looking, willing to enter new territories and niche markets.
(The author is General Manager (Operations & Strategic Planning), SEAL InfoTech Pvt Ltd)
The incumbent must experience the joining process, not as mere signing of certain documents such as the PF etc. While these are certainly essential, the incumbent should experience it in totality, right form the time he\she entered the office, greeted by the security, received by the HR and conducted into the company — the whole range of experience should have a human touch.
While in the previous decades the real crunch for industry was that of resources (read cash). now it is the problem of finding and retaining talented employees.
While the HR Department has to wade through a massive, often redundant data-base of prospective employees, the typical haystack syndrome results — inability to get talented (easily convertible to revenue) people on board.
The limited talent available is being attracted by too many employers. So much so, the alacrity with which the applicants apply is not reflected in offers being taken up by them.
Offers are made but the incumbents do not join. The reasons are not difficult to glean. One can blame it on the wide variety of choices available.
Today, there are plenty of job offers and prospective employees have the time to wait, and pick and choose the most lucrative offer.
Indecision seems to be a deliberate ploy of the job-seekers. There is no worry like "if I do not join now, I may miss the bus", as there are many other buses which he or she can board.
An employer's antenna perks up when the prospective employee suddenly becomes incommunicado. Hitherto, the communication channels used were the telephone and, at times, even personal visits. Now, an e-mail greets you on a Monday morning that he is having some health problems and may be joining after a while (date not specified).
And then, he does not turn up for induction, either at the corporate office or at the project site. He asks for more information, mostly irrelevant, such as about the city, its weather, etc.
He also sounds inquisitive or sceptical about the company's future projections.
How to tackle this situation?
Always keep the communication channels open. Clear all the stumbling blocks. Communicate with the would-be employee promptly. This sets at rest doubts that the employee may be having about your company and any second thoughts about joining.
The results of an interview process are: Selected, rejected or on hold. Do not hold on to the `hold list' for too long; communicate rejects with a polite mail immediately. Similarly, communicate quickly to those who are selected.
Now, for those who are short-listed, constant communication is a must. Invite them and take them around the company. This will make it easier for them to arrive at a decision.
Most short-listed applicants are concerned about the notice period they are supposed to serve. Depending on the company's policy, include the pay in lieu of the notice as a one-time component at the time of joining. This will make the applicant feel good.
Another feel-good factor is: Honour the commitments of joining bonus, designation, etc. Recruitment of experienced and senior-level professionals needs more delicate handling. When these experienced personnel join, ensure that a senior member of the organisation welcomes them personally This will take care of protocol issues.
When it comes to monetary compensation, make it employee-friendly. Do not camouflage the actual payment. Most employees are interested in take-home pay.
A well-drafted compensation package is a better takeaway for an employee. Make clear which allowances are taxable and tax-free and what actually goes into the account of the employee at the end of the month.
Expectation setting
Make an honest pitch about onsite posting, designation, etc. These need deft handling. For example, one may say that an onsite posting is subject to the candidature being cleared by the client.
One may have occupied a high post, say vice-president, in a small company. A similar designation may not be accorded in a large organisation, as there are more management layers.
To improve the joining ratio, corporates might announce a small one-time bonus if the incumbent joins on the date agreed to. This could be in the form of a gift coupon. The incumbent must have a wholesome joining experience — right from the way he is greeted by the security, received by the HR and conducted into the company.
On the day of joining, conduct an interactive induction into the company and let most of the complying with formalities be handled virtually. A professionally done induction ensures that the incumbent does not feel lost in the new milieu.
Joining is an assortment of experiences. At each level of interaction, always exude warmth and give the incumbent a feeling of being wanted. Share the future plans and allay his apprehensions.
When the incumbent is circumspect about the future, share with him the strides made so far by the organisation and that it is forward-looking, willing to enter new territories and niche markets.
(The author is General Manager (Operations & Strategic Planning), SEAL InfoTech Pvt Ltd)
Monday, January 08, 2007
Army schooling for executives
Business Standard - 8th Jan 2007
The Army Institute of Management, Kolkata (AIMK) is gearing up to provide tailor-made courses to executives who have finished college a while ago but want to do additional courses to face the changing world scenario.
"A management student reaches a senior managerial position, but by that time management strategies would have changed so much that the need to upgrade to understand and compete with the changing scenario becomes mandatory," explained K K Choudhuri, director of Army Institute of Management at Kolkata (AIMK). Hence the need for executive or continuing education.
The institute's short-term courses were developed to give professionals exposure to new management strategies, acquiring knowledge wider in scope than what is covered in most university curricula, and refreshing knowledge learned in colleges years ago. This is ensured at AIMK through management development programmes (MDPs).
The programmes target executives in functions such as marketing, sales, business development, customer care, product and brand management and retail. Some programmes have been developed for managers in manufacturing, project engineering, real estate, finance and other service sectors.
The courses range from 2-3 days, 8 hours per day, with the batch size being 20-30. "The executives who usually avail these courses are almost always middle to senior professionals, or general managers of companies, sponsored by their respective companies," said Choudhuri.
The executive education programmes at AIMK combine lectures, multimedia supported presentations, case studies and panel discussions, with course fees between Rs 4,000 and Rs 7,000.
Around 60 per cent of the teachers comprised AIMK faculty. and the balance 40 per cent senior-level professionals from companies.
Companies which in the last 6 months had sponsored professionals for AIMK courses included NTPC, NICCO, Tyre Corporation, Indian Explosives, Sky Tech Solutions, MSTC, ONGC, Jaya Shree Textiles, UBI, SAIL, CESC, WBSEB, National Insurance Co Ltd, Tata Refractories Ltd, BSNL, BPCL, Uco Bank, ITC Sonar Bangla, OFB, Syndicate Bank, ITC, SAIL, Allahabad Bank and Oriental Insurance. AIMK also conducted executive education at company campuses.
In December 2006, AIMK conducted in-company courses for ONGC and Mumbai Port Trust. "In February this year, AIMK will conduct soft skills courses," said Choudhuri.
"Soft skills have become important and a level-playing filed has emerged as technology is no longer a constraint. Soft skills make for managerial effectiveness and lead to enhanced business.”
The Army Institute of Management, Kolkata (AIMK) is gearing up to provide tailor-made courses to executives who have finished college a while ago but want to do additional courses to face the changing world scenario.
"A management student reaches a senior managerial position, but by that time management strategies would have changed so much that the need to upgrade to understand and compete with the changing scenario becomes mandatory," explained K K Choudhuri, director of Army Institute of Management at Kolkata (AIMK). Hence the need for executive or continuing education.
The institute's short-term courses were developed to give professionals exposure to new management strategies, acquiring knowledge wider in scope than what is covered in most university curricula, and refreshing knowledge learned in colleges years ago. This is ensured at AIMK through management development programmes (MDPs).
The programmes target executives in functions such as marketing, sales, business development, customer care, product and brand management and retail. Some programmes have been developed for managers in manufacturing, project engineering, real estate, finance and other service sectors.
The courses range from 2-3 days, 8 hours per day, with the batch size being 20-30. "The executives who usually avail these courses are almost always middle to senior professionals, or general managers of companies, sponsored by their respective companies," said Choudhuri.
The executive education programmes at AIMK combine lectures, multimedia supported presentations, case studies and panel discussions, with course fees between Rs 4,000 and Rs 7,000.
Around 60 per cent of the teachers comprised AIMK faculty. and the balance 40 per cent senior-level professionals from companies.
Companies which in the last 6 months had sponsored professionals for AIMK courses included NTPC, NICCO, Tyre Corporation, Indian Explosives, Sky Tech Solutions, MSTC, ONGC, Jaya Shree Textiles, UBI, SAIL, CESC, WBSEB, National Insurance Co Ltd, Tata Refractories Ltd, BSNL, BPCL, Uco Bank, ITC Sonar Bangla, OFB, Syndicate Bank, ITC, SAIL, Allahabad Bank and Oriental Insurance. AIMK also conducted executive education at company campuses.
In December 2006, AIMK conducted in-company courses for ONGC and Mumbai Port Trust. "In February this year, AIMK will conduct soft skills courses," said Choudhuri.
"Soft skills have become important and a level-playing filed has emerged as technology is no longer a constraint. Soft skills make for managerial effectiveness and lead to enhanced business.”
Corporates lure CAs with fatter salaries
Business Standard - 8th Jan 2007
The demand for chartered accountants (CAs) in the corporate world has shot up with stringent income tax laws which require compulsory maintenance of accounts by specified categories of taxpayers.
Around 102 companies from the information technology, business process outsourcing, financial services and manufacturing sectors came recruiting when campus interviews were organised by ICAI at 11 centres across the country during 2005.
Average salary levels during the placement shot up by 50 per cent from Rs 2 lakh per annum to Rs 4lakh. The highest salary offered was Rs 12 lakh.
The Institute of Chartered Accountants of India (ICAI) churned out 8,000 CAs last year, of which 84 per cent has been placed in companies.
What's the reason for this trend? Explains T N Manoharan ICAI president. "Fresh passouts prefer the corporate sector to begin their career since it is less riskier than setting up an independent practice and the remuneration on offer is just too attractive to refuse."
The ICAI training equips CAs to prepare the returns for tax purposes and represent assessees before the income tax authorities and this has spurred the demand for accountants.
Manoharan notes there is a huge demand for CAs abroad too but with the demand picking up in India, migration of CAs to foreign lands has declined considerably. Currently, there are 12,000 CAs from India employed In corporates abroad.
Under the current laws, Indian CAs are not allowed to set up practice in foreign countries. ICAI is however negotiating with countries including Singapore, US, UK and Australia to allow Indian CAs to set up practice in that country, Manoharan said.
However, ICAI states there is an acute shortage of CAs in India and corporates are increasingly finding it difficult to find qualified CAs.
Proof of this is the fact that during last year's campus placement in ICAI, corporates managed to recruit just 1,034 CAs of the 8,000 CAs who passed the examination, as the rest had already found jobs in corporates outside the placement process.
The demand for chartered accountants (CAs) in the corporate world has shot up with stringent income tax laws which require compulsory maintenance of accounts by specified categories of taxpayers.
Around 102 companies from the information technology, business process outsourcing, financial services and manufacturing sectors came recruiting when campus interviews were organised by ICAI at 11 centres across the country during 2005.
Average salary levels during the placement shot up by 50 per cent from Rs 2 lakh per annum to Rs 4lakh. The highest salary offered was Rs 12 lakh.
The Institute of Chartered Accountants of India (ICAI) churned out 8,000 CAs last year, of which 84 per cent has been placed in companies.
What's the reason for this trend? Explains T N Manoharan ICAI president. "Fresh passouts prefer the corporate sector to begin their career since it is less riskier than setting up an independent practice and the remuneration on offer is just too attractive to refuse."
The ICAI training equips CAs to prepare the returns for tax purposes and represent assessees before the income tax authorities and this has spurred the demand for accountants.
Manoharan notes there is a huge demand for CAs abroad too but with the demand picking up in India, migration of CAs to foreign lands has declined considerably. Currently, there are 12,000 CAs from India employed In corporates abroad.
Under the current laws, Indian CAs are not allowed to set up practice in foreign countries. ICAI is however negotiating with countries including Singapore, US, UK and Australia to allow Indian CAs to set up practice in that country, Manoharan said.
However, ICAI states there is an acute shortage of CAs in India and corporates are increasingly finding it difficult to find qualified CAs.
Proof of this is the fact that during last year's campus placement in ICAI, corporates managed to recruit just 1,034 CAs of the 8,000 CAs who passed the examination, as the rest had already found jobs in corporates outside the placement process.
Tax aspects to consider before sending staff on deputation
Business Line - 8th Jan 2007
When an Indian company deputed its staff to the foreign parent company, should it deduct tax from salary paid to the staff? This, in simple, was the question before the Authority for Advance Ruling (AAR) recently. The company in question was British Gas India Private Ltd, Gurgaon, which is part of the UK-based BG Group.
The ruling, as per the Authority's order dated November 8, was that the Indian company need not deduct tax on salary paid to the staff deputed to the UK (`How UK collected tax on Indian salary,' in Business Line dated December 2). Condition, however, was that the salary should have been offered for tax in the UK in pursuance of the DTAA (double taxation avoidance agreement). To know what the impact of the ruling is, Business Line posed a few questions to Mr Govardhan Purohit, Executive Director, PricewaterhouseCoopers.
The BG ruling, in brief: AAR's ruling in the BG case is that salary paid in India by the Indian employer to the non-resident employees deputed outside India would not be taxable in India in terms of the provisions of Indo-UK treaty, if such salary has been offered to tax in the UK. In such a situation, the requirement to withhold taxes from the Indian salary would also not come into play.
Is this an example of the Income-Tax Act and the treaty speaking differently?
Under the Income-Tax Act, non-residents are taxable in respect of income derived from a source in India, or income that is received in India. Accordingly, salaries received in India by the employees deputed to the UK were taxable in India. However, the Income-Tax Act yields to the treaty (DTAA), wherever the latter is more beneficial.
How is the benefit available in the treaty with the UK?
Under Article 16 (1) of the Indo-UK treaty, salary income is taxable in the country where the employment is exercised. The AAR, granting the treaty protection to the employees, held that the salary income was taxable only in the UK by virtue of the their employment in that country.
Whom does the ruling benefit?
AAR rulings are private rulings, which cannot be taken as binding precedents in general. However, ratio laid down by the ruling has persuasive value. Seen thus, the BG ruling could be viewed as favouring employers who depute their employees outside India.
Who can get the treaty protection?
Treaty protection can be sought only if the taxpayer qualifies as a resident of one of the contracting states, under the relevant treaty. Conditions governing the determination of residential status could vary depending upon the treaty being referred to.
Can the BG ruling benefit staff sent to the US?
In the case of the Indo-US treaty, an individual, taxable in the US only in respect of his US-sourced income, does not qualify as a resident for treaty purposes. Thus, for an Indian employee on deputation there, his global income is not taxed in the US.
He would not, therefore, qualify as a tax resident of the US for treaty purposes; and the treaty shelter would not be available to him. Such employees, in spite of being treated as non-resident for Income-Tax Act purposes, would be liable to tax in respect of salaries received in India. This is in contrast with the provisions of the Indo-UK tax treaty, where the residence conditions are more liberal.
How will the situation be if the deputation is to countries with which India hasn't signed a tax treaty?
No different. Take, for example, Hong Kong. India does not have treaty with that country. Suppose an individual who is a non-resident in India is deputed to Hong Kong. Salary received by such individual in India would become taxable in India.
Does it become necessary to consider all this when planning deputations?
Yes, it is imperative that the above factors be considered while entering into secondment/ deputation arrangements. In cases where individuals are deputed to countries with which India does not have treaty in place or where India has a treaty but individuals may not qualify as tax resident under the relevant treaty, an argument could be made that salary is not taxable in India under the Income-Tax Act, as services have been rendered outside India. Provided, however, the employee also receives the salary outside India from the overseas employer during such arrangements.
Deputation per se, or only to the parent company?
In the BG ruling, the employees were deputed to the parent company. Where employees are deputed to other companies, the basis of taxation of salaries in the hands of employees isn't affected.
To what extent is residential status a key consideration?
One needs to consider provisions governing residential status under the Income-Tax Act while entering into secondment/deputation agreements. Taxability in India is determined on the basis of residential status of an individual, which in turn, is dependent on the number of days the individual is present in India.
For instance, an individual going on deputation outside India, prior to September 30 will enjoy the benefit of having a stay of less than 182 days in a financial year thereby entitling him to obtain a non-resident status in India for that financial year.
Tax planning for deputations, shall we say?
Yes, with the growing number of international assignments taken by Indian employees, employers need to carefully consider the tax implications and hedge such arrangements against double taxation burden.
When an Indian company deputed its staff to the foreign parent company, should it deduct tax from salary paid to the staff? This, in simple, was the question before the Authority for Advance Ruling (AAR) recently. The company in question was British Gas India Private Ltd, Gurgaon, which is part of the UK-based BG Group.
The ruling, as per the Authority's order dated November 8, was that the Indian company need not deduct tax on salary paid to the staff deputed to the UK (`How UK collected tax on Indian salary,' in Business Line dated December 2). Condition, however, was that the salary should have been offered for tax in the UK in pursuance of the DTAA (double taxation avoidance agreement). To know what the impact of the ruling is, Business Line posed a few questions to Mr Govardhan Purohit, Executive Director, PricewaterhouseCoopers.
The BG ruling, in brief: AAR's ruling in the BG case is that salary paid in India by the Indian employer to the non-resident employees deputed outside India would not be taxable in India in terms of the provisions of Indo-UK treaty, if such salary has been offered to tax in the UK. In such a situation, the requirement to withhold taxes from the Indian salary would also not come into play.
Is this an example of the Income-Tax Act and the treaty speaking differently?
Under the Income-Tax Act, non-residents are taxable in respect of income derived from a source in India, or income that is received in India. Accordingly, salaries received in India by the employees deputed to the UK were taxable in India. However, the Income-Tax Act yields to the treaty (DTAA), wherever the latter is more beneficial.
How is the benefit available in the treaty with the UK?
Under Article 16 (1) of the Indo-UK treaty, salary income is taxable in the country where the employment is exercised. The AAR, granting the treaty protection to the employees, held that the salary income was taxable only in the UK by virtue of the their employment in that country.
Whom does the ruling benefit?
AAR rulings are private rulings, which cannot be taken as binding precedents in general. However, ratio laid down by the ruling has persuasive value. Seen thus, the BG ruling could be viewed as favouring employers who depute their employees outside India.
Who can get the treaty protection?
Treaty protection can be sought only if the taxpayer qualifies as a resident of one of the contracting states, under the relevant treaty. Conditions governing the determination of residential status could vary depending upon the treaty being referred to.
Can the BG ruling benefit staff sent to the US?
In the case of the Indo-US treaty, an individual, taxable in the US only in respect of his US-sourced income, does not qualify as a resident for treaty purposes. Thus, for an Indian employee on deputation there, his global income is not taxed in the US.
He would not, therefore, qualify as a tax resident of the US for treaty purposes; and the treaty shelter would not be available to him. Such employees, in spite of being treated as non-resident for Income-Tax Act purposes, would be liable to tax in respect of salaries received in India. This is in contrast with the provisions of the Indo-UK tax treaty, where the residence conditions are more liberal.
How will the situation be if the deputation is to countries with which India hasn't signed a tax treaty?
No different. Take, for example, Hong Kong. India does not have treaty with that country. Suppose an individual who is a non-resident in India is deputed to Hong Kong. Salary received by such individual in India would become taxable in India.
Does it become necessary to consider all this when planning deputations?
Yes, it is imperative that the above factors be considered while entering into secondment/ deputation arrangements. In cases where individuals are deputed to countries with which India does not have treaty in place or where India has a treaty but individuals may not qualify as tax resident under the relevant treaty, an argument could be made that salary is not taxable in India under the Income-Tax Act, as services have been rendered outside India. Provided, however, the employee also receives the salary outside India from the overseas employer during such arrangements.
Deputation per se, or only to the parent company?
In the BG ruling, the employees were deputed to the parent company. Where employees are deputed to other companies, the basis of taxation of salaries in the hands of employees isn't affected.
To what extent is residential status a key consideration?
One needs to consider provisions governing residential status under the Income-Tax Act while entering into secondment/deputation agreements. Taxability in India is determined on the basis of residential status of an individual, which in turn, is dependent on the number of days the individual is present in India.
For instance, an individual going on deputation outside India, prior to September 30 will enjoy the benefit of having a stay of less than 182 days in a financial year thereby entitling him to obtain a non-resident status in India for that financial year.
Tax planning for deputations, shall we say?
Yes, with the growing number of international assignments taken by Indian employees, employers need to carefully consider the tax implications and hedge such arrangements against double taxation burden.
SumTotal tool for managing talent
Business Line - 8th Jan 2007
Technology company SumTotal Systems has announced the release of SumTotal Enterprise Suite 7.5, a software to train extended enterprise of customers, partners and supply chain and distribution channels.
This software delivers and manages training for not only employees but also a wide range of audiences beyond an employer's staff.
Highlights of SumTotal 7.5 include a variety of e-commerce capabilities for managing the transactions tied to selling, buying, delivering and tracking training.
Its new capabilities cover distributing and administering global learning in multiple languages and an array of reporting tools for analysing, among other things, what people learn, a company statement said.
Technology company SumTotal Systems has announced the release of SumTotal Enterprise Suite 7.5, a software to train extended enterprise of customers, partners and supply chain and distribution channels.
This software delivers and manages training for not only employees but also a wide range of audiences beyond an employer's staff.
Highlights of SumTotal 7.5 include a variety of e-commerce capabilities for managing the transactions tied to selling, buying, delivering and tracking training.
Its new capabilities cover distributing and administering global learning in multiple languages and an array of reporting tools for analysing, among other things, what people learn, a company statement said.
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