Social Cause Marketing - The Regis Group Inc

INTERVIEW
Following Mr. Barack Obamaís
economic stimulus package, every
government has followed the
suit. Itís more than four months
since those packages were announced
and disbursed (at least
partially). But the recovery seems
to be getting delayed beyond expectations.
When do you think
people can expect a positive recovery
from this downturn?
Stimulus packages, especially large
packages, will take some time to have
an impact. Here we are not talking
about one company and its people. We
are looking at a nation with diverse
needs and sectors. I think, in India, a
certain amount of recovery is on its
way. 2010 will overall be a tough year
which we have to find ways to ride
out. In the Western world where the
impact has been far higher, the recovery
time will also be longer.
At the beginning of this century,
every where there was talk of talent
management prophesying
time and again that people are the
key assets. And everyone complained
of talent crunch. Now that
there is cash crunch, in the name
of either managing a downturn or
restructuring, every company resorts
to sacking the employees
mercilessly. In fact, some CEOs
advocate their divisional heads
not to be emotional and sentimental
and take a knife and chop off.
Why this U-turn?
I would not agree with you here. Let
us not get taken in by a few newspaper
reports here and there. Yes, some of
what you say may have happened, but
it is difficult for us to appreciate the
position that those people may be
been in at that time.
I reiterate that people are our asset,
and our key asset ñ there is not doubt
about this. In that, talent is the most
priceless commodity. The next is the
fit between talent and the requirements
of the job. These will continue
to be any HR managerís challenges going
forward.
What happens to all such companies
resorting to massive layoffs
as regards image and long-term
standing? Do you think people
would excuse them for being
treated as inanimate objects especially
during such trauma times?
Companies in dire straits have had to
resort to such measures; this has not
been a rule across the board. It would
be good to hear more about those who
have persevered to protect and even
enhance jobs at this time. And there
are many companies who have, including
Apollo Tyres. But you are
right there is an immediate image issue
that companies face in such situation.
The only upside, or even downside
if thatís how you prefer to see it, to
this is that when performance is good,
public memory is short.
Even giving benefit of doubt to the
companiesí pursuing lay off policies,
what happens to the morale
of all those who fortunately manage
to survive (because they happen
to be the ëbestí employees) and
hold on their existing jobs? Can
companies expect best performance
from their ëbestí employees?
You are right. Such actions not just
have an impact on those leaving but
also leave a psychological scar with
those remaining. Actions such as
those you mentioned, if not managed
properly and communicated well, often
result in the best people leaving
immediately after the downturn is
over or as soon as they get another job.
And of course it affects morale of all
employees and creates a feeling of insecurity.
Do you think layoff is the only answer
to manage the downturn?
Geoff Colvin argues (Fortune,
March 30, 2009) that the costs of a
layoff ñ Brand equity costs, leadership
costs, morale costs, Wall
Street costs and rehiring costs ñ
should be guarded against. Given
these inevitable costs and costsaving-exigencies,
what do you
think should be a companyís
policy towards layoffs?
As I mentioned earlier, every situation
brings its unique circumstances. For
some may be, a certain amount of layoffs
was the answer. This could indicate
also that the company was carrying
more people than it needed to ñ
and that can be for various reasons ñ
and therefore it was imperative to take
this action.
Our way has always been to look at
various options. At Apollo, we have
used two methods extensively ñ redeployment
and scaling back on manufacturing.
We redeployed people
across functions and locations and
also decreased the total days of manufacturing
to enable us to keep both
manpower and inventory costs low.
People are trading off their jobs
for wage cuts and other measures.
What is the efficacy of other job
saving schemes like shifting to
shorter working hours, temporary
work suspensions at factories,
work-sharing programs and
lower pay in exchange for tacit job
guarantees? The bigger question
however is can they be sustained?
Exactly what I am talking about. These
are all measures that can be deployed
during tougher times when the production
volumes required are lower
than usual to ensure gainful employment.
And yes they can be sustained
for a period of time to tide over tough
times. However, as you will understand
these are not measures that are
required when goods are selling and
production is working on full capacity.
Cutting working hours also adds
to the bigger macroeconomic
problem currently hammering
the world economy: lack of demand.
Pay cuts eat into consumer
spending, which in turn amounts
to more bad news for a world
economy in need of stimulus.
Therefore, how do you expect the
government and the companies to
make concerted efforts to make
sure that oneís solution does not
become anotherís problem? Or is
it inevitable?
In todayís world not only is the personal
related to the economy but also
one nation to another. Today we live in
a far smaller world and nothing takes
place in isolation. Some of this is inevitable.
However, if you see how the
Indian government has acted, we have
a lesson here. It has tried throughout
this period of bring down inflation,
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