president’s message New HR for winning <strong>the</strong> war for talent Firdose Vandrevala is President, AIMA and Executive Vice Chairman, Essar Steel India Limited. The 1990 Arnold Schwarzenegger film Total Recall has a scene that typifies conventional HR wisdom. It involves an exchange between <strong>the</strong> boss and his employee, which goes like this: Employee: “But I thought…” Boss: “Who told you to think? I don’t give you enough information to think. You do what you are told. That’s what you do!” Employee: “Yes, sir!” The employee rebels anyway and bad things happen to <strong>the</strong> organisation. The takeaway is quite obvious: to utilise and keep talent, you have to empower people instead of t<strong>hr</strong>owing tantrums. Too many companies lose <strong>the</strong>ir best people and do not get <strong>the</strong> right talent for future success because <strong>the</strong>y cannot get over <strong>the</strong> fetish of hierarchy. In <strong>the</strong> <strong>new</strong>, knowledge economy, brute capital is not enough to buy performance or loyalty. Companies have to now rely on <strong>the</strong> voluntary excellence of <strong>the</strong> talented to innovate and compete. Setting targets and flogging do not make <strong>the</strong> talented give <strong>the</strong>ir best. Even <strong>the</strong> most commoditised of industries can no longer maximise output by slave driving. There is a war for talent out <strong>the</strong>re and talent has to be charmed. Moreover, capital is chasing talent now and <strong>the</strong> most talented people are turning <strong>the</strong>ir backs on jobs and setting up firms that make <strong>the</strong>ir former employers irrelevant. This <strong>new</strong> balance of power between capital and talent is shaping <strong>the</strong> <strong>new</strong> HR. The <strong>new</strong> HR is about creating employer brand and persuading talent to play for your team. The <strong>new</strong> HR is helping improve <strong>the</strong> company’s earnings and market share t<strong>hr</strong>ough employee initiatives and not just maximising output t<strong>hr</strong>ough hard labour. As talent becomes <strong>the</strong> main input and differentiator, HR is turning into a strategic function with responsibility for business outcomes. In any business wherein buying and consuming experience matters as much as <strong>the</strong> price, HR is critical to success. In services businesses, such as IT, banking and finance, media, entertainment, retail, consulting, etc., HR determines <strong>the</strong> productivity of <strong>the</strong> capital. Some CEOs have gone to <strong>the</strong> extent of propounding <strong>the</strong> idea of putting <strong>the</strong> satisfaction of <strong>the</strong> employees ahead of that of <strong>the</strong> customers. Building an employer brand is particularly vital to get talented millennials on board, as <strong>the</strong>y are spoilt for choice in <strong>the</strong> global market. Companies now have to vie with one ano<strong>the</strong>r to secure a top slot in <strong>the</strong> numerous lists drawn up by media and consulting firms. They have to market <strong>the</strong>mselves to top education institutions and students. They even have to go social to make <strong>the</strong>mselves appealing to <strong>the</strong> youth of <strong>the</strong> digital age. Using recruitment websites is now generic and <strong>the</strong> smarter HR is mining social media for finding talent and conversing with relevant professionals. They are also managing employer brands primarily t<strong>hr</strong>ough social media. Nowadays, employees tend to share <strong>the</strong>ir workplace experiences more on social media than with <strong>the</strong>ir colleagues or bosses; and <strong>the</strong>ir reviews and information leaks can make or break an employer brand. In fact, digital technologies are transforming HR in many more ways than just recruitment and branding. HR can now set data points for employee attributes and performance, collect and analyse employee data, and correlate it with <strong>the</strong> firm’s performance. Thus, HR can now measure <strong>the</strong> return on investment on hiring and training on a daily basis, and identify talent gaps and fill those quickly. Digital technologies also offer <strong>the</strong> HR tools for training and deploying employees faster and cheaper. Digital tools allow anytime, anywhere instruction and testing. They also facilitate remote collaboration that helps optimise <strong>the</strong> talent distributed in different divisions and at difference locations. The <strong>new</strong> HR is changing <strong>the</strong> way firms look at employees. People are no longer an inevitable cost. Ra<strong>the</strong>r, <strong>the</strong>y are <strong>the</strong> most important value creators. The opinion expressed is personal. 6 INDIAN MANAGEMENT NOVEMBER 2015
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