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Issue of August 2004 
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CIO Strategies: Tackling The Hurdles

Married to the Org.

When knowledge workers are an asset to an organization, the challenge is in identifying and retaining key individuals and honing their skills for improving the business. by Brian Pereira

Despite the oft-repeated phrase, "No one is indispensable," every organization acknowledges that people are a valuable asset. Because when people move on for better opportunities, they take with them skill sets that are essential for the business. Hence the organization has to find a way to minimize this unpleasantness. It becomes a challenge for CIOs to retain IT staff, and there are different ways of dealing with it. While some may choose to outsource routine functions or take knowledge management initiatives, others will adopt programs to retain key staff who add value to the business.

A big challenge is to retain key staff and identify how critical they are to the business. In doing so, one has to ask why is an employee 'key' and for how long? After all, the criticality of a person's role could change depending on the context of the organization or during different phases of the project.

"We did face a challenge with people and have taken three approaches to this. Firstly, we've kept our key staff to the minimum, so that we are able to live up to their aspirations. As a CIO, it's important to understand the aspects that would affect the organization in the absence of certain key people. Then you consider the aspirations of these people," says Jason Gonsalves, General Manager, IT & Costing, Goodlass Nerolac Paints.

Gonsalves says the second approach was to ask "how critical" is the role of key staff, and for how long. "Does he possess the skills that will be useful in the long term (3 - 5 years from today)?"

And the third approach, says Gonsalves, was to ask why we consider staff to be critical. "Is someone critical because you have inadequate processes/systems? Or has he become key because he is a value contributor?"

Retention

Once key staff have been identified, the next step is to focus on how you will retain them. In this scenario, the employer must be aware of the employee's objectives and career roadmap—and work towards these. This can be done through training programs, frequent feedback and monitoring, and of course, good top-down communication.

"We have quarterly training programs for all our employees. Employees recommend the topic and even the venue for training. In addition, we have monthly 'melt-ins' within the department on any evening. This ensures proper teamwork. High-performing employees are also sent abroad for training, to our HQ, to benchmark and set stretched goals," says Arindam Bose, Head - IT, LG Electronics India Pvt Ltd.

Larsen & Toubro Infotech believes in benchmarking compensation and non-monetary value-adds that an employee enjoys or perceives.

Besides employee retention programs and incentives, one also has to focus on the human aspects and create "emotional buy-in," as one CIO puts it.

Some employees look primarily at monetary value. While others are dead serious about career and growth. Gonsalves says, "We try to give every individual a view of both. Yes, there is a monetary benefit, but there are also other benefits that are coming through. We try to "marry" the organization's need and his need as best as we can. That's how we create emotional buy-in over a period of time."

Gonsalves adds, "People are interested in organizational building if they see that there is a clear picture (roadmap) ahead."

Both employee and employer would like to avoid the unpleasant situation of parting ways. And this can be avoided at the outset with some initiatives that originate in the HR department.

L. Sundarrajan, Sr. Vice President, Corporate Information Technology, Aditya Birla Group, says the organization should be sure if it is hiring the right people. Then it needs to plan for their career in the long term. The employee's job description (and the organization roadmap) should be well defined.

"Then hire the right people which fit in that job description from a short-term and long-term perspective. Some people will have the potential and you need to invest in them. Hire a person for his potential and skills. The mistake people make is they hire people with skills that are immediately required," says Sundarrajan.

To Outsource or not?

If retention of key staff and skills is a continuing problem, then it would make complete sense to outsource certain processes to external parties. Take the IT division of LG Electronics for instance. It has just five people on payroll and about 50 people from outsourced partners. The move has vastly improved its operations.

While the trend is now to outsource, one should be cautious and weigh the pros and cons. "Diligent and strategic outsourcing is always advisable, instead of a 'go with the flow' approach," says C. Kajwadkar, Sr. Vice President, NSE.IT Ltd.

Some believe that outsourcing is the only solution, though one cannot outsource everything. V. K. Magapu, Chief Information Officer (CIO) and Executive Director, Larsen & Toubro Limited feels outsourcing is the only robust solution. "The solution is robust because it delivers value in the face of several distractions and compulsions. This is so since the services are being provided by individuals who take pride in working in mainstream activities of the vendor company. Similar individuals inside the contracting company essentially view themselves not as the mainstream of their company."

For others the strategy is to 'Rightsource,' that is outsource selectively. Routine operations like maintenance of PCs and peripherals can be outsourced. On the other hand, certain critical processes that add much value to the business (or are highly confidential), can be performed in-house.

Mani B. Mulki, General Manager (Information Systems), Godrej Industries Ltd says the real challenge is about outsourcing smartly—a process he calls 'Rightsourcing.' He feels it makes sense to outsource a process that is considered critical, at the same time, one doesn't perceive much value from doing it in-house.

If there is an internal function that is adding tremendous value to a process, it should be 'insourced' rather than outsourced.

Before rightsourcing, Godrej Industries used to have a large team of code writers for its internal software requirement. It faced the challenge of retaining them due to high attrition levels. Today, Godrej has outsourced code development of any software. What remains in the department are the people who understand business and technology, and who know what value technology brings to the table.

"When you do rightsourcing, you get a set of motivated people since they are contended with their work. And the organization appreciates their work," says Mulki.

Another example is Air-India. It had to opt for selective outsourcing when it faced an acute shortage of experienced manpower, for both open and legacy platforms. Routine activities such as facility management at the airports, and hardware maintenance of mainframes have been outsourced. But key software development areas where AI has acquired considerable domain knowledge, are being done in-house.

So it amounts to striking the right balance and identifying what can really add value to your business. Then think long-term and nurture the skills of your prized assets—People.

Brian Pereira can be reached at brianp@networkmagazineindia.com

 
     
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