In the first phase, which was dominated by a decade-long extraordinary growth in the Indian software industry after a brief melt down during 2000 and 2001, the HR function was primarily driven by the need to bridge the vast demand-supply gap of skilled engineering resources. This was accentuated by very high attrition rates, sometimes reaching as high as 40 per cent per annum! (Referring to software companies only).

In these circumstances, it was natural that the recruitment and retention aspects of HR were in the forefront. People-development and team-building initiatives were moderately successful in this uncertain environment, where there was a constant churn of people. In retrospect, this phase neither helped the organization nor the people. As a result, the industry itself faced a talent crunch and it hampered the sustained growth of knowledge and skills – technical, behavioral as well as managerial.

Today, high attrition rates are declining and perhaps expected to become history (hopefully forever)! This has been driven by the declining demand-supply gap, as well as willingness of employees to build and invest in a relationship in their existing organizations.

Aided by a relatively stable people situation, HR will enter into a phase that will embrace strategies to sustain the stability and develop people with a focus on continuous improvement in the productivity, knowledge and specialization.

Strategies to strengthen Business HR

Behavioral Traits

To begin with let us revisit the performance evaluation system and evaluate the system itself. There is a need to ensure that any performance evaluation system must cover every aspects of employee development with a greater emphasis on the behavioral traits such as conflict resolution, teamwork, effective responsiveness, sharing of best practices and knowledge management. It is important to be aware that behavioral patterns practiced by the individual employee and the teams in an organization will have a greater influence on the overall culture of the organization.

Every organization will have its own values, a careful focus to nurture those specific behavioral traits that depicts the organizational values that can be diluted with the performance evaluation system. Even then one can come across areas of uncertainty, which needs to be identified and corrected or initiate the process of elimination.

Performance Evaluation

While we always identify areas of growth and high performers in the organization, one must be conscious of the employees who need improvement. Strategic plans must be in place to enhance the performance of the employees who are below acceptable standards of performance. This may not be just due to skills mismatch; many a time the concerned individual may not integrate well with the organization culture, or simply not fit into the team and to top it all could even be a perpetual poor performer. Even when the performance evaluation system adequately covers these aspects, the gaps need to be constantly identified and bridged.

In addition, a successful performance evaluation system will need a well defined succession plan coupled with talent management and assessment process.

Rewards & Recognition (R & R)

Let us move onto yet another critical HR tool – R & R has become and will have an enhanced importance to employees focused on their long term career goals.

Rewards and recognition of employees have become part and parcel of any organization today. However the reward system must undergo rapid and continuous innovation to keep up with the dynamism of people thinking and create excitement for the people to appreciate the reward system that will have a substantial bearing on the organizational culture. One must remember any reward system has its own life cycle like any other product and every HR practitioner must evaluate that cycle time to innovate newer systems much ahead of the curve.

Culture

One another important factor that will work to the advantage of the people and the organization will be unique culture an organization can nurture, which will bond, attract and retain talent. This can include various psychological factors like social, emotional, building a sense of community and belonging. Employee loyalty has already moved from company loyalty to loyalty to profession and in future this will further move towards specialization in niche areas with-in a profession. Therefore there is already a strong need to build and sustain people bonding with both the organization and profession.

Freedom of enterprise and empowerment though is a buzzword but never was understood in its true sense, which will now have a tremendous focus in the near future to realize its true effectiveness to sustain retention of performing people. Therefore nurturing unique organizational values that build the culture in an organization will be a clear “competitive and strategic advantage”.

One of the major components of strategic HR will be developing internal entrepreneurship at all levels, which may radically change the behavioral pattern of people, the forms of work and the nature of work itself. Those who are willing to adapt will remain and continue to succeed.

HR mandate will now get stronger on organizational strategy, structure, customer satisfaction and internal consulting apart from employee satisfaction, performance improvement, productivity and quality. The numbers game will become more of an administrative function. The main thrust of HR will be creating and sustaining a strong “spirit of enterprise” with a major thrust on innovation in HR interventions.

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