Essar appoints Michael Foley as CEO,East Africa

1 Jul, 2008, 1704 hrs IST, PTI, Economics Times

 

MUMBAI: Essar Communications Holdings (ECHL), today said that it has appointed Michael P Foley as CEO-East Africa and he would have overall responsibility for the group's telecom investments and operations in the region.

Foley will oversee the roll-out and launch of Econet Wireless Kenya, a press release issued here stated.
Foley brings on board commercial and management experience gained from a number of leading telcos in Canada, East Europe, the Middle-East, Tanzania and Nigeria.

Earlier in the year, ECHL had acquired a 49 pc stake in Econet Wireless International (EWI) by subscribing to fresh capital in the company.

Essar will actively participate with EWI in the network roll-out of Econet Wireless Kenya. Econet Wireless Kenya has also announced three senior leadership appointments, the release said.

These are Shailendra Khare as the Chief Technical Officer, Philip Mudimu as Project Director (East Africa) and Anna Othoro as Marketing Director.

Khare has over 20 years of technical experience with the last 13 years in the cellular network domain while Mudimu is a veteran of Econet and has played an instrumental role in steering the economy through the last five years.

Othoro has extensive experience in commercial management (sales and marketing) spanning over 11 years having held various senior management positions at both local and international level with GlaxoSmithkline Consumer Healthcare Limited and also as Managing Director of Celtel Kenya Limited.

 

Building Your 'I Care' Brand During the Gas Price Surge

Corporations around the world are missing an opportunity both to help their employees during their economic struggles and to build their employment brand image as an employer that cares. The foundation of this opportunity is the current surge in gas prices and other economic factors that are heavily impacting almost every corporation’s workforce.

It’s almost impossible to pick up a newspaper or magazine and not read about the economic conditions that are putting a strain on almost everyone’s budget and way of life.

Rather than ignoring it or hoping it will go away, look upon it as a chance to “turn lemons into lemonade” and to further strengthen your employment brand image.

It has been common for corporations to offer benefits to their employees to ease their commutes or to help save the environment. However, the recent dramatic rise in gas prices provides corporations with an opportunity to really amp up their offerings, and to demonstrate to those they wish to attract and retain that the organization “cares” about them.

In fact, one study by Dr. Wayne Hochwarter, of Florida State University, found that high gas prices led to more stress on the job, thus impacting employee performance. In his research, Dr. Hochwarter found that one-third of the employees surveyed said they would quit their job for a comparable one closer to home.

Research by outplacement consulting firm Challenger, Gray & Christmas found that 34% of employers had potential candidates who turned down jobs because of long commutes and added nearly 8% of employers report turnover caused by high transportation costs.

Acting now provides an opportunity to build your employment brand because the combined topics of gas prices, food prices, and the mortgage crisis are hot in the media. As a result, any bold action by a corporation is likely not just to be viewed positively by employees and potential applicants but also by those covering consumer confidence and spending in the media.

Efforts by employers to help workers cope with these economic factors will likely be written up in the press and in business publications. Not only would you be helping your workers, but you will also be building employee loyalty while getting free PR to further strengthen your employment brand image. It’s an opportunity that won’t last long, so it shouldn’t be missed.

Many firms have already been recognized for excellence in these areas, including Google, Intel, Oracle, Microsoft, Cisco, Nike, and HP. There are many actions to consider, and I’ve separated the various options into broad categories below.

Promoting Drive-Less Options

The first group of options is relatively cheap, but they can have a significant impact on the amount of money your employees need to pay in commute costs. 12 “drive-less” options include:

1. Compressed workweek options. Offer schedules that allow commuters to reduce the number of days they come in to work. A 4-day, 10-hour workweek is the most popular, but some professions also use 3-day, 12-hour weeks. The key is to not just offer these programs, but to encourage individual managers to allow their employees to actually take advantage of them.  If coverage is an issue, consider allowing employees to alternate on/off alternative schedules.
2. Work at home. A related option is to allow employees to choose on their own to work one or more days at home. In addition to saving commute costs, firms like Best Buy have found that telecommuting can generate up to a 35% increase in employee productivity, and research by the Gartner Group found up to a 40% improvement. Allowing employees to take periodic “planning” or innovation days where they spend their time thinking and planning for the future can also be an effective option. Benchmark firms in this area include Best Buy, Sun, IBM, Agilent, and HP.
3. Satellite offices. By establishing satellite offices closer to where employees live, firms can offer opportunities for employees to use restricted computer and communications networks that cannot be accessed remotely while reducing the mileage employees drive to and from work. Employees that need to use company equipment (but do not necessarily need to meet with coworkers) can decide on which days they will work from these remote corporate locations. Microsoft’s touchdown space is an excellent example of this practice; however, Sun is the benchmark firm in this area, locating offices on all major access routes into major metropolitan areas.
4. Bike/walk to work. This can both improve health (reducing benefit costs) and help employees save on gas. Companies can facilitate this practice by offering maps that highlight the flattest and quickest routes. They can also help by providing relaxed dress codes that allow employees to wear athletic clothes, as well as providing bike storage space and showers for their peddling employees. Walk to work or walk to mass transit location programs can have similar positive impacts.
5. Make all-day meetings remote. Rather than requiring everyone to commute to all-day meetings, use conference calls and Web-based tools to allow some workers to attend meetings from home. These options can also save airline travel costs. HP and Cisco are the benchmark leaders in this area.
6. On-site services. Dry cleaning, concierge, flowers, and take-out food can reduce the need for employees to run errands during lunch and after work. Also, consider vendor-provided gas-saving services like engine tune-ups and tire inflation. Google is a leader in this area.
7. Offer online training. This can save on travel costs. Also, consider offering university classes on-site, so that your employees can improve themselves without the increased costs associated with driving to a local university.
8. Reduce lunchtime and snack travel. For firms with few on-site lunch options, consider inviting lunch wagons that can sit in the parking lot. Other options include providing box lunches and snacks on site, as well as menus from local restaurants that deliver, shifting the cost of ordering out to the food provider.
9. Increase company car usage. Firms can help their employees reduce their personal gas costs by liberalizing or expanding the number of opportunities for employees to use company cars.
10. Job transfers. In organizations with many outlets (like retail), reduce employee gas usage by offering a one-time option to facilitate transfers to locations closer to the employee’s home. Consider offering internal “save on gas” job fairs where workers can meet with managers from other locations to see if relocation is a viable option that provides mutual benefits.
11. Shift the organization’s start time. In congested areas, starting your commute an hour earlier or later can result in significant gas savings as a result of fewer backups and less congestion.
12. Live close to work facilitation. Firms can offer services or work with local Realtors in order to make it easy for their employees to find apartments and housing close to the workplace. The leading firm in this area is Facebook, which offers an astonishing $700 per month salary supplement for employees who live within a mile of their headquarters. University Hospitals in Cleveland is also a benchmark organization.

Share the Commute

• Coordinate shared commuting. Firms can help their employees to both save on gas and tolls by facilitating employee carpools, van pools, or a company shuttle. In many large cities, tax breaks encourage corporate van-pooling programs.  An additional benefit is the reduced need for employee parking.  Microsoft, Yahoo, and HP are benchmark firms. Also, offer a company-sponsored shuttle bus from transit stations close to work or from strategic locations.
• Coordinate schedules. More individuals would share rides if they could share similar schedules with individuals who live close to them. This option requires you to work with individual managers to ensure that they make commuting part of their scheduling decision criteria.

Facilitate Opportunities for Cheaper Gas

• Negotiate group discounts. Because corporations with many employees have significant buying power, work with local fuel suppliers and individual gas stations to negotiate volume discounts for employees who use targeted stations. Incidentally, try similar options for bulk food items to help employees deal with the rising cost of food.
• Buy “company” gas. Some organizations have their own fueling facilities and these firms might be able to find a way to offer that gas to employees. By buying “gas futures,” firms can successfully hedge against future price increases (i.e., Southwest Airlines has successfully done this for its aviation fuel).
• Allow employees access to “fleet” stations. Some firms utilize gas stations that provide gasoline for fleet cars. Negotiate with their vendors to identify opportunities where employees can get gas at these low-priced fleet stations.
• Negotiate “buy” options. Use the company’s volume buying power to help negotiate lower-cost deals with vendors that allow your employees to lease or buy more gas-efficient vehicles. Vehicles might include scooters, electric segues, bikes, and compact or hybrid cars. (Note: there federal and in some cases state tax advantages associated with purchasing hybrid cars.)
• Subsidize mass transit. Offer subsidies to individuals who use mass transit. Some government agencies provide tax advantages to firms that facilitate the use of mass transit (others provide penalties to those that don’t).

Increase Manager and Employee Participation

Corporations can take specific steps to encourage both individual managers and employees to participate in gas-saving options:

• Measure and reward managers. Recognize those who are “commute cost” friendly; conduct an employee survey to identify the best.
• Executive participation. Have the CEO and senior executives actively participate in company programs (i.e., participating in car pools, biking to work, or occasionally driving the company shuttle).
• Gas incentives. Provide gas cards as incentives and rewards for top-performing employees and managers.

Miscellaneous Options

• Conduct a survey and ask employees what they think you should be doing.
• Benchmark other firms to see what else is possible.
• Allow compacts, hybrids, and scooters to park closer to the building to send a message that you care about the environment.
• Help them sell their gas-guzzler car or subsidize the purchase of fuel-efficient vehicles.
• Add saving gas as a criterion for selecting new facility sites.
• Consider reducing nepotism restrictions so that family members can work together and thus, commute together.

Provide Employees with Opportunities to Earn More Money

Because rising costs are essentially lowering your employees’ “real” standard of living, provide your employees with more opportunities to earn more money during these tough economic times:

• Opportunity for overtime. Encourage managers to develop more opportunities for employees to work overtime to help them offset the rising cost of living.
• Pay for performance. Offer increased opportunities for performance-based pay. Although giving employees “more money” is always a high-cost item, if any additional pay is based strictly on improved performance, both firms and employees can come out ahead.
• Increase mileage allowance. The IRS has recently recognized a higher cost of gasoline by increasing the amount of reimbursement that it allows per mile traveled. Companies can help their employees by not waiting and increasing their mileage allotment immediately.
• COLA. A final option to consider is offering your employees periodic cost-of-living adjustments. Sometimes this is necessary in order to decrease your employees’ need to look for a second job (or even a job at another firm) in order to meet their family needs.

Final Thoughts

As you can see, there are many options available to corporations. For the best impact, implement a comprehensive program with many elements. Not only will this approach have a larger impact on employees, but it also increases the odds of your effort receiving positive exposure.

How to Manage Your Team in a Downturn (and Come Out on Top)

Layoffs have truncated staff; cost-cutting measures are threatening projects, and morale is in the toilet. From the manager’s perspective, getting the most out of employees in this kind of environment can seem like a Sisyphean task. In fact, it’s a perfect opportunity to rejigger processes and fix what’s broken — and managers are uniquely positioned to do just that. Here’s how being candid with your employees, rewarding them in creative ways, and enlisting them to help make hard decisions can not only keep your team motivated but pull your company out of its slump.

Set the Tone

Goal: Lower the anxiety level in the office by being candid about the challenges — and opportunities — ahead.

It’s easy to blame the economy for all the reasons a company is suffering: Customers are cutting back on their expenses, advertisers are trimming their budgets, and stock prices are sliding. These problems may, in fact, be attributable in part to the downturn, but going with the “It’s the economy, stupid” defense sends a subtle but potentially dangerous message to employees: It implies that the situation is totally out of the company's hands and left in large part to fate. This is exactly the kind of attitude that raises anxiety levels in the office and disrupts employees’ focus on the problem at hand: turning business around.

“Have the confidence to not completely blame the economy,” says Stanford business professor Bob Sutton. “If employees believe that leadership can break things, they’ll believe that leadership can fix things, too.”

Don’t just rely on the CEO’s message. An e-mail from the top explaining why the company is in the red can’t tell employees much, which means mid-level managers need to be the interpreters. Speak to employees in small groups and be as candid as possible about where the company stands. This is also a good time to suss out any rumors. “Organize quick events to ask what people have heard and to answer any questions they have,” says Dave Logan, a senior partner at Los Angeles-based consulting firm Culture Sync.

Open the books. Giving employees the numbers behind company performance clarifies where the business needs to change and how their jobs connect to the bigger picture. But be warned: “If you’re going to be transparent, take the necessary time to teach employees about how the business works,” says Rich Armstrong, general manager of the Great Game of Business, a coaching firm that teaches open-book management. He advises managers to start with what employees probably already understand, like operational numbers, and then connect the dots with how those numbers increase gross margin and generate cash flow. Above all, keep finance jargon to a minimum.

Focus on the future. There’s no need to sugarcoat it: Pulling the company through the downturn isn’t going to be easy, but emphasizing the challenge can have its benefits. “It’s a great time for [your employees] to realize that they can play a role in discovering opportunities for the company,” says Vince Thompson, a former manager at AOL and author of the book Ignited.

Hot Tip

The You in Team

If a company is going to stay resilient, the staff’s collective commitment and collaboration are essential. In this environment, simply making an effort to be more visible and available to employees can spark productivity and bring the team together.

For example, if you normally work within the confines of a walled office while your team toils away in the cube farm, grab your laptop and set up shop in a cubicle near them — even if it’s only a couple of times a week. Start showing up to the smaller meetings that you usually skip, or rearrange your travel schedule to cut down how much time you spend out of the office. In short, don’t wait for employees to take advantage of an open-door policy. Go to them first, and ask how their work is going. This isn’t about micromanaging — it’s about knowing firsthand what they need.

Enlist the Team to Fix What’s Broken

Goal: Motivate employees and find out how and where the business needs to change.

Traditionally, the top execs decide the strategy and let it trickle down. The problem with this tactic is that it rarely makes the emotional case needed to mobilize employees around a common goal, says Paul Bromfield, a principal at Katzenbach Partners, which has advised companies like Aetna, Credit Suisse, and Pfizer. “This is about problem-solving and discipline, and that’s where employees come in,” he says. “Companies should be harnessing employees in the effort to identify where to cut costs and how.”

Not only will utilizing workers’ expertise make them more invested in the company’s success, it also gives management a more honest look at what’s not working. Senior leadership tends to focus on just one area of cost-cutting, Bromfield says, like products, headcount, or moving operations off-shore. Employees, on the other hand, can use their collective wisdom to eliminate clumsy (and costly) procedures across divisions.

Here are four guidelines for involving staff in the process:

1. Identify key influencers. “If you’re really going to mobilize people, you can’t do it from the top,” Bromfield says. Find the key employees who hold sway in their departments and get them to embrace and spread the change effort. These are the people who know how things really work (not just the way they’re supposed to work) and have a way of bringing together the right people to get things done.

2. Let teams do the problem solving. Form groups around the influencers and motivate (rather than mandate) employees to identify what’s slowing down business. Often the best place to start is to look for processes and bureaucracies that annoy the team. Set a basic timeframe to achieve cost savings, but let each group work at its own pace.

3. Make it a conversation. Schedule brown-bag lunches or other informal venues to talk to employees about their findings and where they might be hitting roadblocks. In the early 1990s, Bromfield’s former client Texas Commerce Bank held focus groups with thousands of its employees to find out what procedures most frustrated bankers and customers. Using the feedback, the company nearly doubled its $50 million cost-savings goal.

4. Follow through. Many cost-savings programs fail because management implements the initiative only halfway or lets inefficiencies creep back after meeting short-term goals, which won’t sit well with employees. Adopt the changes wholesale or not at all.

Big Idea

Keep Top Performers Moving

In an ideal world, the upside of a downturn is that recruiting qualified employees becomes easier. With more candidates in the job market, now could be the time to find new talent if your company has the resources to continue hiring. But managers shouldn’t forget about the top performers already on staff, say Monster executives Steve Pogorzelski, Dr. Jesse Harriott, and Doug Hardy, authors of a recent paper on how companies should invest in employees when business slows down.

When the economy’s bad, it’s easy to think that employees are grateful to have jobs at all. But layoffs and budget cuts may cause good workers to look for better opportunities. Give them a reason to stay by making room for them to keep advancing their careers. “Keep critical talent moving — not necessarily up, but growing in experience, responsibility, money, or other tangible and intangible ways,” say the authors of the study. If promotions or raises aren’t possible, give good workers the chance to make a lateral move or to take on a struggling department.

Get Back to the Work That Matters

Goal: Make sure your team is tuned in to growth opportunities.

The problem with a downturn is that while cost cutting is absolutely necessary, it can make everyone gun-shy about pursuing new initiatives and opportunities for investment. However, if your department, and in turn the company, is going to emerge from the slump in a competitive position, there are a few key investments you can’t afford not to fight for now:

Customers

Learn about the customers of your weakest competitors, writes Michael Roberto, a blogger for Harvard Business Publishing and management professor at Bryant University. While competitors are busy shoring up their relationships with large, established clients, it could be the perfect time to swoop in and court their smaller customers.

Research and Development

Take a cue from Apple’s Steve Jobs. When asked by Fortune magazine recently about Apple’s strategy for the downturn, Jobs pointed to how the company survived the 2001 tech bust by upping its R&D budget. “It worked, and that’s exactly what we’ll do this time,” he told the magazine.

Separate the value-added activities from the wheel-spinning exercises, Thompson suggests in Ignited. Instead of giving up on new projects in a downturn, shift focus so that the team is investing time in identifying and prioritizing the projects that will generate the most benefit for the company. Even if the final product will have to wait until more resources are available, doing the legwork now means the product will go to market faster when the time is right — and employees will stay engaged in the meantime.

Vendors/Partners

“There are two ways to run a business,” says Fred Mossler, senior vice president of merchandising for online shoe retailer Zappos, “adversarily or as a partnership.” Considering that the company relies on about 1,500 partners to provide its customers with a diverse selection of shoes, Zappos has chosen the latter option. To that end, the company built an extranet, so that every partner can see how its brand is performing. “They get to see everything our buyers see,” Mossler says. “This way we have about 1,500 other sets of eyes looking at our business and helping to improve it.”

Case Study

How Zappos Survived the Tech Bust

The idea for Zappos was born in 1999, when the economy was booming. But the shoe retailer still was unprofitable and struggling to grow revenue two years later, when the recession hit. “It was impossible for us to get any additional funding,” Mossler says. To make matters worse, the company was learning that its original business plan, which made Zappos a middleman, wasn’t working as planned: Vendors didn’t always have every shoe in stock, and customers — who sometimes had to wait weeks for their orders to arrive — often ended up with the wrong orders.

Though the times might have called for belt-tightening, the company had to make a couple of very expensive decisions, both of which put long-term strategy before short-term cost cutting. First, management realized that it needed total control over the merchandise in order to give the best customer service — a decision that meant sacrificing 25 percent of company revenue. Second, to make sure customers knew exactly what they were getting, the company hired photographers to take pictures of every pair of shoes it stocked. The site now has photos of its more than 3 million items, mostly shoes, from up to eight different angles. “Most companies look at customer service as an expense, but we look at it as a long-term investment,” says Mossler. The moves paid off: Less than 10 years after its founding, Zappos is on track to bring in more than $1 billion in sales this year.

Acknowledge and Reward Deserving Employees

Goal: Recognize achievement, even if resources are scarce.

Employee bonuses and raises are among some of the first expenses that upper management cuts during a downturn. But even if extra compensation isn’t in the budget, that doesn’t excuse managers from rewarding employees. “Lack of recognition — both financially and verbally — is one of the things that does the most damage,” says David Sirota, founder of the management-consulting firm Sirota Survey Intelligence. “I worked with an investment bank some years back where bankers were earning bonuses from $100,000 to $1 million a year,” he says. “You know what they complained about? They didn’t know if the chairman thought they were actually doing a good job, because he never spoke to them about it.”

Video: Giving Effective Praise.

One easy, no-cost way of recognizing valuable employees is to improve their quality of life. “The best reward you can give people is autonomy over how they spend their time,” says Jody Thompson, a former Best Buy human resources manager who, along with Cali Ressler, helped create the company’s Results-Only Work Environment program. That means giving employees your trust and the flexibility to work at home (or wherever suits them) whenever they want to — without any judgments. This gives workers more control over their time, and sometimes even a little extra cash. Sun Microsystems has found that employees who worked an average of 2.5 days at home each week saved $1,700 a year in gas and vehicle wear-and-tear.

Danger! Danger! Danger!

Save Rewards for the Worthy

Keeping your employees engaged doesn’t mean rewarding them just for doing their jobs. The most effective rewards are significant but well deserved. Libby Sartain became head of Yahoo’s human resources department in 2001, just as the company received a hard knock from the dot-com bust. She decided that instead of quietly giving large bonuses to overachievers, which wasn’t providing much bang for the buck, Yahoo needed to regularly single out the top 15 to 20 stellar individuals and teams — not only to reward them, but to help the rest of the company understand what made these employees outstanding.

The following year, the company gave its first Superstar Awards. Candidates were nominated by their peers for significant achievements and awarded cash prizes ranging from $5,000 to $50,000. The Yahoo Superstar Awards program is now in its seventh year and has honored employees for contributions like creating the Panama advertising system, inventing a way to advertise on instant messages, and fixing a troublesome accounting problem. “This isn’t egalitarian, this is a meritocracy,” Sartain says, acknowledging that some managers resisted the idea at first. “When people saw the winners, they understood why they won, and it took hold and became part of the culture.”

Are the consultancies going to shut down soon because the corporate companies are buying the job portals???

I wont say that the consultancies would typically shutdown, but yes I would also be lying if I am saying that "the good 'ol days would come back". Business in the RPO industry is hit a big time and it's going bad to worst.

Surviving in such a market by any RPO consulting company would demand a drastic mutation in its DNA, viz. the services.

If you're question would have been, "Would all the job placement telecalling units that had mushroomed up in the industry in past 2 years be shut down?"

My answer would be a BIG.... OBVIOUS... YES!

The real time RPO or HRO consulting companies would adapt in it's ways to source CV's and create a fresh Data pool. Though major chunk of business would be lost with the job portals being acquired. But that would be compensated with other consulting services like assessments and training.

In short I can simply say that the life cycle of the industry has started again. This time it's more evolved and challenging. ;)

Regards,
Viral Thaker

Join me on LinkedIn - http://www.linkedin.com/in/vrlthaker
This question was sent to Viral Thaker by Purvi Shah through LinkedIn.
If you have any questions, please contact vrlthaker@gmail.com
© 2008, LinkedIn Corporation

If Recruiting is Like Sales, Let's Act Like Sales People

I don't run into many recruiters/staffing/HR professionals who don't agree with the statement: Recruiting is just like sales.

While we can argue over the differences between the two professions (please don't lose sight of the trees through the forest on this one), we all know the parallels are overwhelming.

Consider the following shared business philosophies:

Ø       Recruiters prospect/source for candidates, while sales people prospect/source for new business opportunities/contacts.

Ø       Recruiters develop relationships with prospects to turn them into candidates, while sales people develop relationships to turn prospects into viable business opportunities.

Ø       Recruiters assess the candidate's skills to determine whether they are a fit for the organization, while sales people assess the business opportunity with a potential client.

Ø       Recruiters "negotiate" compensation and turn (close) candidates into employees, while sales people close deals and turn prospects into customers.

 

So if recruiting is just like sales, shouldn't we be benchmarking the most successful salespeople/organizations and learn from them?

 

While there are many things we could learn and benchmark from top sales producers, you will find a lot of their energy and true passion is around the following topics:

 

Ø       Monthly/weekly/daily meetings about pipelines, activity, etc.

Ø       Incentive-based compensation models.

Ø       Ongoing motivational contests to reward top performers.

Ø       Emphasis on ongoing learning, execution, and time management.

Ø       Aggressive attitude about achieving goals and performance management.

 

Although many agency/staffing recruiters subscribe to some, most, or even all of these types of behaviors, I am always surprised to find that many corporate internal recruiters do not function like a sales organization!

 

Investigating the Trend

Why is this?

Is there really a big difference between internal and external recruiting? Again, we know some obvious differences, but really, recruiting is recruiting, isn't it?

 

To this point, I am often amazed at the response I get from corporate/internal recruitment leaders. With one statement they will say "I need my recruiters to think of recruiting like it is sales. I need them to act more like consultants."

 

But when I start discussing the topics and behaviors above, they get uneasy.

 

They say things like the following:

"That won't work in our culture."

"We are not a staffing/agency."

"We have large req loads, so that won't work."

"We are all too busy to do these things."

Desperately Seeking Sales-Minded Recruiters

There are many corporate recruitment organizations that function and think like a sales organization, and it's time these people speak up.

I am not making these points to "bash" corporate/internal recruiters. That is not my intent. The main reason I bring this up is because whenever I start talking about these subjects, many (not all) people say, "Oh, that is for agency/staffing recruiters!"

But I just do not see it that way. If you can see the parallels between the two and believe that recruiting is just like sales, then you need to start benchmarking the most successful sales organizations, thought leaders, etc., and start learning from them.

Do this regardless of what type of recruiter you are!

With that said, I would love to share best practices around a variety of topics (i.e., internal, external, staffing, HR, corporate, agency recruiters, all are welcome):

Ø       Monthly/weekly/daily meetings about pipelines, activity, etc.

Ø       Incentive-based compensation models for corporate recruiters.

Ø       Motivational contests to reward top performers.

Ø       Emphasis on ongoing learning, execution, time management.

Ø       Recruiter goal setting and performance management.

Ø       Best sales organization, thought leaders, etc. to benchmark.

I will present these best practices in future articles on ERE!

Caught in the Middle: Why Developing and Retaining Middle Managers Can Be So Challenging

Published: May 28, 2008 in Knowledge@Wharton

Almost every company has them. They may number six or 6,000 and they all share the same job category -- middle managers. They are often referred to as the "glue" that holds companies together, bridging the gap between the top management team and the lower level workers. They implement strategy and organizational changes, keeping workers engaged during both good and bad economic cycles.

 

However, middle managers also can be a challenging group of employees to develop and retain. According to a 2007 Accenture survey of middle managers around the world, 20% reported dissatisfaction with their current organization and that same

percentage reported that they were looking for another job. One of the top reasons cited was lack of prospects for advancement.

 

"Many companies are seeing significant turnover in middle management ranks, and with significant turnover, they don't have the ability to execute strategy," says vice dean of Wharton Executive Education Thomas Colligan. "Top management can

spend all their time creating strategy, but without someone there to implement it, where are you at the end of the day?"

 

In addition to strategy implementation issues, the cost of turnover is extremely high for companies. Colligan noted that one large partnership facing a 20% turnover rate did a calculation in which it concluded that for each 1% it could reduce turnover, it would increase partner earnings by $80,000.

 

"Middle managers are very important to attract, develop and retain, and some companies are becoming painfully aware of that." These observations are even truer in a down economy that is struggling with higher gas and food prices,reduced consumer spending, downsizing and a degree of uncertainty that is affecting industries across the board.

 

David Sirota, co-author of The Enthusiastic Employee: How Companies Profit by Giving Workers What They Want, predicts that middle managers will "again bear a significant part of the pain that the current economic conditions will bring." After the last downsizings in the 1980s and 1990s, many of the middle management positions that were eliminated have reappeared. These could be likely targets again, he notes.

Joe Ryan, adjunct professor at Wharton Executive Education, agrees. As companies go through economic cycles like the current one, middle managers get hit with the elimination of rewards and incentives and, in some cases, layoffs. This is particularly true now in the financial services industry, he says. "In cost-cutting times, knee-jerk reactions happen. There is a paradox where middle managers are essential, but end up sacked when restructuring occurs. It's a rough situation because the people needed to run the most important projects are in the middle."

 

If companies don't manage change well, they will confront a "frozen" middle management and "vicious cycles of low morale and low engagement," Ryan says. "Regardless of the economic climate, companies need to build a resilient workforce and engage the middle to go forward, because this is where change occurs."

Lack of Advancement

Middle managers are essential in organizations, in part because they link senior management and the rest of the company. Sirota describes them as "the glue across upper and lower levels as well as horizontally with other departments."

According to Jane Farran, a senior fellow in Wharton Executive Education and managing partner of the consulting firm C4, with the economy under siege these days, "a lot of belt tightening is occurring. Many companies are nipping and tucking to make their numbers." That's not a good strategy, she suggests.

Indeed, when companies have tried flattening their hierarchies in the past -- thinking that middle managers are extraneous and a few layers of them could be eliminated -- the result was not what they expected.

"These intermediaries have a very important role," she says. "The middle managers translate strategy and the big picture so that it makes sense and is applicable for the day-to-day workers." At the same time, middle managers are taking note of workers' needs, making their own observations of client interfaces and shop floor activity, and relaying that information up to the senior managers. In addition, "they are a buffer between the top managers" and lower-level employees.

If middle managers are so valuable, why would they report dissatisfaction and leave their companies? A primary reason is lack of advancement opportunity, says Sirota. "When companies downsize, they will often cut middle management ranks. But even if companies just stagnate, advancement opportunities are limited. This hits people very hard, particularly people in their late 30s and 40s."

Bringing in new people -- as opposed to promoting from within the company -- can also present a "tremendous frustration" to middle managers, says Sirota. The track records of external people are typically not as good as internal employees who have a deeper knowledge of the company. "And when someone new comes in, he or she often has a view of existing middle managers, [one that says], 'If you were already working here, then you can't be too smart and we need to clean house.' This has a

detrimental effect on a workplace."

In addition, using search firms to fill top positions from outside can send a message that "maybe middle managers shouldn't stay at that company any longer," says Colligan. He describes one company which historically brought in top-level leaders from the outside, resulting in the departure of managers one level below, many of whom went on to become CEOs and CFOs at other companies. "The company had great people who knew they would never become CEO if they stayed. I'm not suggesting that there is never a time to use search firms, but for some companies, the search firms are almost their human resources department."

 

Whether they aspire to be a CEO or not, middle managers need a plan that will take them to the next level, Colligan adds. "If a middle manager sees that ... there are opportunities to grow, then retention is increased versus a company that sticks someone in a slot with no development or discussion about moving him into another position, even if it's a lateral move to expand experiences."

 

Thousands of boutique search firms are calling middle managers these days to entice them to take a job at another company. If people are not on a track, or are unsure of where they are going in the next couple of years within a company, they are more vulnerable to being picked off by a competitor. "People tend to be tweaked by these calls," Colligan says. "You don't have to be totally dissatisfied. You might be doing

okay, but see that this new opportunity could improve your station in life and offer more compensation.

People compare jobs more quickly today than ever before and there is more of a willingness to change." Other top reasons for dissatisfaction among middle managers include micromanagement by senior managers and lack of respect, says Sirota. "And sometimes the senior leader is just really ineffective; middle managers don't want to be in a company that is run by that type of person."

Then there is the stereotypical situation in which middle managers have no authority but all of the accountability, according to Wharton management professor Jennifer Mueller. These managers must navigate "the upward hierarchy extremely well and also influence people beneath them," she says. "This can be complicated and frustrating because the ways in which these things happen are often not codified

in terms of the relationships people have."

Navigating the various relationships upward, downward and horizontally can be an emotional management challenge, adds Wharton management professor Sigal Barsade. "This is particularly noticeable with organizational change. If you are a middle manager, there may be a change that you didn't have much to do with, but you need to translate it to your people and make them feel protected and valued.

However, you are also someone being impacted by the change. Because you didn't design the change, you might be left feeling like you don't know what to do yourself, but you still need to comfort, protect and inspire your people."

Indeed, middle managers are often torn in two because of the need to play a translation role – listening to the top and being responsive to the bottom, says Farran. "When you talk to them, they feel that strategic thinking is the last thing they have time for, and they almost always feel unappreciated and misunderstood."

The 60/20/20 Rule

"When people come in the door, 20% will make partner no matter what you do; 20% will not make partner no matter what you do, and 60% will make partner if you do the right things," says Colligan, referring, for example, to law firms and investment banks. In other words, the highest performers will succeed and the lowest performers will not succeed. However, for those 60% in the middle, "the right things" can make a big difference.

Given the high cost of turnover and the importance of middle managers in implementing strategy and change, how do you "do the right things" to help those people move up?

Individual development plans that are connected to corporate goals, and access to educational opportunities can play a big role in increasing retention rates, Colligan states. "While many companies don't have robust education programs, they can send employees for an executive education program on marketing, strategy or finance -- something that enhances their skills as a middle manager. It tells the manager that the company cares about him or her. Companies that do this on a regular basis tend to find turnover lower."

 

While most organizations don't readily admit to neglecting middle managers, it can happen because senior managers tend to be so consumed with strategy, particularly in today's rapidly changing markets, Colligan says. "I can understand top management focusing on strategic initiatives, but they need to be careful not to spend all of their time doing that. Some time should be spent on the development and retention of middle managers."

Another solution gaining popularity today is coaching, Colligan adds. Coaches are no longer brought in only for remedial reasons. Today it's more like having a personal trainer. "The example is, 'You don't think you need a coach? Tiger Woods has three.' They are mostly used for top managers, but you are starting to see them used for middle managers as well. Those employees may get group coaching, or they might do a 360-degree review and self assessments with Myers-Briggs types of tests to learn their leadership styles. Most middle managers who go on to top management positions certainly go through that, with more individual coaching coming in later as they move up."

Part of this group coaching might include learning about the dynamics of being in the middle, suggests Farran. "We often advise middle managers to first, recognize the dynamic and second, not get drawn into trying to solve all the problems of both top and lower managers. It helps middle managers immensely when they feel that they aren't the only ones who feel this way.... We recommend that they meet with their peers across an organization to compare notes about messages from the top and issues from the bottom, to help with problem solving and to gain perspective."

Barsade notes that participation can also be key in reducing turnover. "Really involving middle managers and allowing them to participate in a change decision, design and implementation will lead them to have more buy-in and ownership so when they have more accountability, they can step up to that."

Ryan stresses communication as a key element for finding ways to engage midlevel managers in understanding a company's new strategic initiatives -- "helping people at the middle understand in more tangible terms what they need to do. This may include more concrete objectives, examples and messages so that people who interface with customers or run processes understand where the company is and what it needs to do differently."

As for tools to retain middle management, Mueller suggests that bonuses and incentives aren't that helpful. "These are things that happen once a year or are relatively small." Instead, what's important is treating employees with fairness and recognizing their contributions. "When people perceive inequity in their environment because they put in more than they are getting, or inconsistencies where others are

putting in less and getting more, this can create all sorts of dissatisfaction," she says. "Also, all of the different things that middle managers do aren't necessarily being recognized because they are working with so many people across the organization who aren't necessarily communicating with each other. Recognizing value is part of how fairness translates for this group."

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Bain & Company's Sri Rajan: 'Private Equity Has to Show Indian Companies the Value It Can Bring'

Published: May 29, 2008 in India Knowledge@Wharton

In the wake of the U.S. financial crisis, valuations of Indian firms have

tumbled -- something which the private equity industry has been careful to

note, according to Sri Rajan, partner and head of Bain & Company's private

equity practice in India. Over the next few months, he predicts, "we'll see a

lot more deal flow with private equity firms in India." Rajan, whose work

with private equity funds includes mergers and acquisitions, post-merger

integration, offshore outsourcing and assessing entry and exit risks,

discussed the industry outlook with India Knowledge@Wharton at the

Wharton India Economic Forum in Philadelphia.

An edited transcript of the conversation follows.

Knowledge@Wharton: Has the U.S. financial crisis affected the private

equity industry and India?

Rajan: I think that the impact [in India] is primarily because the stock

market has been impacted. The private equity industry is looking at what is

happening in India very closely, because valuations have come down over

the last couple of months. And what [funds] are hoping is that at some point in time, these downward

trends in valuations will have an impact in terms of the attractiveness of some of these assets.

We haven't seen an increase in the amount of deal flow yet, and we haven't seen the impact of valuations

yet on Indian companies. But, my perspective is that over the course of the next two or three months, we

will see that impact. And we will see a lot more deal flow with private equity firms in India.

Knowledge@Wharton: Is that very similar to what you think might happen in other emerging markets

as well, like China?

Rajan: I think that it is. The one big difference between India and other emerging markets like China is

that over the last three or four years, there has been a significant amount of activity in the private equity

industry in India -- and that is not true for China. So, in terms of both volume and the quantity of private

equity money that has been put to use in India, it has been far higher than China. I think that's the one

basic difference that will lead to increased deal flow in India, compared even to China.

Knowledge@Wharton: What, in India, would you say are the most attractive sectors for investment at

the present time?

Rajan: If you look at the trend over the course of the last three or four years: In 2004 and 2005, the most

attractive sectors were the IT sectors, IT companies, BPO companies and so on. In 2007, the most

attractive sectors were real estate and infrastructure. That is where the bulk of the money went in.

It's a little difficult to predict what will happen, given what's going on with valuations. My sense is that

we will see a lot of activity across all sectors if valuations stay where they are. We're going to see a lot

more activity in manufacturing, which we haven't seen a lot of over the course of the last few years. I

think that India is becoming a manufacturing hub for a lot of subsectors. And, given that, I think there

will be a lot more deals that will happen in manufacturing than what we have seen. My sense is that

services will come back as well. As valuations of services companies also become more attractive, I

think that you will see a lot more of deal flow over there.

Knowledge@Wharton: In making investments, or actually evaluating investments in emerging markets

like India, what kinds of attributes should firms be looking for?

Rajan: The challenge with doing investments in India, especially private equity investments, is that you

have to look at both the macro picture as well as the company very carefully. And, in many instances,

that information is not available very readily -- or not as readily as it might be in the United States, for

example.

So, one of the things that private equity firms have to do is to really understand the macro picture --

understand what the trends are -- but more importantly, have a very good sense about the quality of the

asset, the quality of the company that they are buying, both from a financial perspective and also from

the quality of management team perspective. I think that those are actually very important things and are

as important as accounting diligence and legal diligence, for example, and are what a private equity firm

should look for.

Knowledge@Wharton: One issue that comes up for private equity in any market is finding the right

people to run things. In India, this seems like it is especially an issue. Is that issue likely to get worse, or

do you think that it will get better?

Rajan: I think that it is going to get worse before it gets better. Over the course of the last couple of

years, a lot of money has come to India. There are a lot of funds that are setting up shop in India. I don't

think that that's going to calm down.

I think that we are going to see many more funds which have not yet set up an office in India, but are

looking to set up a presence over there. And, I think that there is going to be a lot more difficulty in terms

of getting talent, especially people who understand what the private equity landscape is like in India, and

how to do deals over there. And so, my sense is that it's probably going to get worse before it gets better.

Knowledge@Wharton: What do you think it would take to make it better?

Rajan: I'm not sure that there is a "fix," so to speak. I think that there are a lot of people who are moving

from other parts of the world to India. These are people who have experience in terms of private equity

deals with offices in New York or London or Hong Kong. So, those people have the private equity

experience. I think the challenge is that those same people will now need to come to India and develop

the relationships that are necessary to make private equity deals happen -- and that, I think, will take

time. So, I'm not entirely sure that there is a quick fix. We're going to have to wait this one out for the

next year or so.

Knowledge@Wharton: Aside from the larger market shocks that have been taking up all of the

headlines, what kinds of trends do you see taking place in private equity in general?

Rajan: One of the things that the private equity industry is concerned about, apart from valuations, has

been the regulatory framework within India. So far, the private equity industry has been unregulated for

the most part. I think that the government has started making noises about potentially controlling flows

into India. I'm not entirely sure where that will go, but that's certainly one concern.

The second concern really is the access to domestic debt markets. In India, it is very difficult to access

domestic debt to do buy-outs, for example. And so, what a lot of private equity funds do is set up

offshore vehicles in order to do that. The debt market has to be developed a lot more for private equity

funds to access that. I don't know when that will happen. I think that it's a matter of time and it's a

question of when, not if. But, I would say that those are two of the issues that private equity firms need to

think about.

Knowledge@Wharton: What sort of opportunities do you see coming up on the horizon?

Rajan: I think that the opportunities are actually very large in India. I say this because I think that the

opportunities exist in almost every sector. We just heard from a panel on infrastructure that talked about

opportunities exist in almost every sector. We just heard from a panel on infrastructure that talked about

the need for a trillion dollars over the course of the next ten years. I think that in terms of opportunity,

there is clearly a lot that exists whether you are talking about infrastructure or you are talking about real

estate, there is a lot of build-out that needs to happen in India; whether you are talking about services

companies or manufacturing companies. I think that the need for capital exists.

And so, I'm not actually at all concerned about the opportunity that might exist in India. I think that what

the private equity firms have to come and show to Indian companies is the value that they will bring. The

value that they bring is not just capital. It has to be far more than that. It has to be expertise. It has to be

the ability to increase or to improve governance practices and so on. In my mind, those are things that

will really differentiate private equity firms from one another. I don't think that there is really an issue of

opportunity at all.

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