'It's vital to build strong employer brands'

IN CONVERSATION

Rajan Srikanth, Mercer Human Resource Consulting's new Asia region head, joined the firm from Accenture, where he was Executive Partner and global lead for its organisational change strategy practice in the US, Europe and Asia.

An alumnus of IIT, Madras, Srikanth has also been assistant professor at the Walter A. Haas School of Business, University of California, Berkeley. He speaks to Rajiv Shirali on the HR scene in Asia

What are your plans for the Asian region?

We grew at 25 per cent in Asia last year, and we anticipate a very healthy growth rate this year too. The Asian region comprises 11 countries and territories and in some of these markets we grew by 50 per cent last year.

Human Capital Advisory Services (HCAS) is our biggest business in Asia today, covering performance management, executive compensation, rewards and talent management. HCAS forms 40 per cent of our business in Asia, but only 5-10 per cent in more mature markets, where talent is not such an issue.

What are your first impressions of the job market and HR trends in India?

The first thing that struck me was that there's a kind of hysteria about talent shortage, and people are hyper-ventillating about it.

My view is that to focus on talent shortage alone is not only to miss the point, but also to create an unhealthy environment. To think only in terms of a supply-demand mismatch is to think that you only need to offer more money to employees.

A better framework in which to look at it is the capability gap. We should put in more people with the right skills and knowledge, and more efficient processes and systems.

Then, instead of throwing more money at the problem, we put more effort into training, employee development and performance management.

The average graduate from an Indian college is first-rate, but he doesn't necessarily have the knowledge, skills and capability to do well. Language training by BPOs, for example, is recognition of this.

HR managers should help their CEOs address capability gaps through training, proper recruitment, assessment, goal setting and compensation policies. Companies that create a better work environment will find that people stay with them even if they pay a little less than market rates.

In what way has the talent shortage phenomenon changed the balance of power between employer and employee?

In hyper-growth economies such as India, there are more opportunities for the individual, and so there's a power shift in favour of employees.

In more stable, mature economies, growth is slower, opportunities are fewer, and there's less fear that employees will leave. But an enlightened company will build a valuable employee proposition that will make it worth an employee's while to stay longer with the employer. It's vital that companies build strong employer brands.

In the last 15 years many global HR consultancies and search firms have entered India. As a result, do you see a change in Indian HR policies?

There is more transparency, more meritocracy and a more disciplined approach to managing HR policies. This is all to the good. Second, most Asian companies are playing catch-up with HR policies in the West, but they are progressing very fast along the learning curve.

They are getting aligned with the West, but they are customising and adapting their policies to Asian conditions. This will happen over the next three or four years, and the pace of innovation will be very quick.

Companies in the West too will need to be innovative in talent management because of their aging populations, and they will borrow innovative practices from Asia.