Archive for the ‘HRD’ Category

Sample Human Resources Policies, Checklists, Forms, and Procedures

August 7, 2009


Looking for policy samples, sample checklists, sample procedures, sample forms, and examples of Human Resources and business tools? You’ve found the site for policy samples, sample checklists, sample procedures, sample forms, and examples of Human Resources and business tools. These samples are provided for personal use for adapting to your organization’s needs, if you cite the source. Contact Susan to inquire about use of the samples for publication or any other use.

See the Human Resources Glossary of Terms.

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Worldwide Cost of Living Survey 2009 – city ranking

July 10, 2009

Tokyo knocks Moscow off the top spot as the most expensive city for expatriates; Johannesburg is the cheapest

  • Asian and European cities dominate the top 10
  • Significant currency fluctuations and strengthening of dollar cause major reshuffle in the ranking
  • London drops 13 places to rank 16, New York joins the top 10 list

Tokyo has knocked Moscow off the top spot to become the world’s most expensive city for expatriates, according to the latest Cost of Living Survey from Mercer. Osaka is in second position, up nine places since last year, whereas Moscow is now in third place. Geneva climbs four places to fourth position and Hong Kong moves up one to reach fifth. Johannesburg has replaced Asunción in Paraguay as the least expensive city in the ranking.

In Mercer’s survey, New York is used as the base city for the index and scores 100 points, all cities are compared against New York and currency movements are measured against the US dollar. Tokyo scores 143.7 points and is nearly three times as costly as Johannesburg with an index score of 49.6.

The survey covers 143 cities across six continents and measures the comparative cost of over 200 items in each location, including housing, transport, food, clothing, household goods and entertainment. It is the world’s most comprehensive cost of living surveys and is used to help multinational companies and governments determine compensation allowance for their expatriate employees.

A significant reshuffle of cities can be observed in this year’s ranking, mainly due to considerable currency fluctuations worldwide. The majority of European cities moved down in the ranking with Warsaw experiencing the most dramatic change, plummeting 78 places from 35th to 113th. London and Oslo, both previously in the top 10, have dropped 13 and 10 places respectively. The same trend can be seen in Australia, New Zealand and India. Sydney has dropped 51 places from 15th to 66th and Mumbai has slipped down to 66th from 48th place.

Cities in the US, China, Japan and the Middle East have surged in the rankings. New York is a new entry in the top 10, jumping from 22nd to 8th place, and so is Beijing, now in 9th place, up from 20th in 2008. Japan now has two cities in the top 10 and Dubai has climbed 32 places to reach 20th.
Nathalie Constantin-Métral, a senior researcher at Mercer, commented: “As a direct impact of the economic downturn over the last year we have observed significant fluctuations in most of the world’s currencies, which have had a profound impact on this year’s ranking. Many currencies, including the Euro and British pound, have weakened considerably against a strong US dollar causing a number of European cities to plummet in the rankings.”

She added: “With significant exposure to multiple economies and currencies, multinational companies continue to be greatly affected by the financial crisis. The cost of expatriate programmes is heavily influenced by currency fluctuations and inflation rates. Now that cost containment and reduction is at the top of most company agendas, keeping track of the change in factors that dictate expatriate cost of living and housing allowances is essential.

“It is important for multinational companies to continuously benchmark against their peers to ensure compensation packages are fair and in line with the rest of the market.”

Europe, Middle East and Africa

In third place and with an index score of 115.4, Moscow remains the most expensive city in Europe for expatriates. However, a dramatic depreciation of the rouble against the US dollar has led to a sharp fall in the city’s index score compared to 2008 (142.4). Accommodation costs also started to decrease at the end of last year after a sharp increase in the first part of 2008. The next European cities in the ranking are Geneva and Zurich in fourth and sixth place, up from eight and ninth respectively. Copenhagen remains in seventh, and both Milan and Paris drop one place to 11th and 13th.

European cities have experienced some of this year’s steepest falls in the ranking, with Warsaw plummeting from 35th to 113th and Glasgow (129th place) and Birmingham (125th place) in the UK falling 60 and 59 places respectively. German and Spanish cities all fell between eight and 11 places, whereas cities in Sweden, Ukraine, Czech Republic, Romania and Hungary all fell between 36 and 48 places. “As most European currencies have weakened against the dollar it has become more costly for companies based in this region to send expatriates and their families to US cities,” said Ms Constantin-Métral.

Oslo and London, both previously in the top 10, are now in 14th and 16th place respectively. “The decline of rental prices both in Oslo and London, coupled with the fall in the value of British pound and Norwegian krone against the US dollar, have caused these cities to plummet in the rankings,” said Ms Constantin-Métral.

While the vast majority of European cities have fallen in the rankings, most Middle Eastern cities have experienced a reverse trend. Both Dubai and Abu Dhabi have risen significantly in the ranking, moving from 52nd to 20th and 65th to 26th respectively. This is mainly due to the UAE dirham being fixed to the US dollar. Tel Aviv remains the most expensive city in the Middle East, although it is the only one in the region to move down in the ranking, from 14th to 17th.

Most African cities moved up in this year’s ranking, although their index scores have decreased. Cairo jumps a substantial 44 places to 57th as the Egyptian pound fared well against the US dollar. The sharp decrease of the South African rand against the US dollar has caused Johannesburg to slip to bottom position.

The Americas

Due to the strengthening of the US dollar, all cities in the US have experienced a rise in this year’s ranking. New York remains the highest ranking city in the region and has also joined the global top 10 list this year, jumping from 22nd to eighth place. Los Angeles is up 32 places to 23rd and Washington is up 41 places to 66th.

Canadian cities have slipped down the index with its highest ranking city Toronto down 31 places to 85th. Ottawa drops 36 places to 121st and Montreal is now in 103rd place, down from 72nd in 2008. “The Canadian dollar has weakened substantially against the US dollar which means employees transferring from New York to Ottawa or Montreal now need fewer US dollars to enjoy the same purchasing power as last year,” commented Ms Constantin-Métral.

In 15th place and up 74 places from 2008, Caracas in Venezuela is the top ranking city in South America. Sao Paolo and Rio de Janeiro have experienced a reverse move, plummeting from 25th to 72nd and 31st to 73rd respectively, Similarly, Bogota has moved down from 87th to 120th place. Buenos Aires has climbed 26 to reach 112th place. “Although the Argentine peso has lost value against the US dollar, the high inflation rate observed on goods and services have caused Buenos Aires to rise in the rankings,” said Ms Constantin-Métral.


Tokyo moves up one place in the ranking to become the most expensive city for expatriates both in Asia and globally. The Japanese yen has strengthened considerably against the US dollar which also lifts Osaka into second place from 11th in 2008. Hong Kong follows in fifth place and Singapore has moved up three places to reach 10th. Most dramatically, Seoul dropped from 5th to 51st place. In 140th place, Karachi continues to be the least costly city in this region – up one place from last year.

The Indian rupee made a significant loss against the US dollar last year and all the Indian cities have moved down the ranking as a consequence. New Delhi moves from 55th to 65th place and Mumbai drops from 48th to 66th.

Chinese cities experienced the reverse effect as the Chinese renminbi performed relatively strongly compared to most other currencies. Beijing is in ninth place, having moved up 11 places to join the global top 10. Shanghai, Shenzhen and Guangzhou follow in 12th, 22nd and 23rd place respectively.

Australia and New Zealand

Cities in this region have taken a significant plunge in the rankings following a dramatic depreciation of the Australian and New Zealand dollars against the US dollar. Sydney remains the most expensive city for expatriates in this region but has dropped from 15th to 66th. Melbourne follows in 92nd, down from 36th. Auckland has moved down to 138th place from 78th and Wellington follows in 139th down from 93rd.

Individual cost of living and rental accommodation cost reports are produced for each city surveyed. For further information or to purchase copies of the city reports, visit, or call Information Product Solutions, Warsaw on +48 22 434 5383.

Source: Mercer

10 power words for your CV

April 17, 2009

So far, our articles on CV writing mainly discussed what you should or should not write in your CV. The purpose of this article is to go a little deeper into the content of your CV and see what type of words can make the selector immediately shortlist your CV for an interview.

The basic purpose of these words is to demonstrate your hold of a particular situation and the actions you took to achieve a result or come out of a situation. One important thing to note here is that the immediate past tense of a verb is more powerful than the verb itself. Using a past tense also shows that you actually completed the work you started successfully. Adding some figures and facts along with these verbs would add more impact.

Let’s see with an example how each word can be utilised to its full power:

1. Achieved

Good example: Achieved the target of implementing the software onsite for 200 users 15 days before the deadline.

Bad example: To implement the software onsite.

This sounds more like a responsibility. The interviewer is mainly interested in knowing about your output.

2. Built

Good Example: Built new premises to convert the study centre into a residential college accommodating 200 students.

Bad example: Building a new premise for the residential college.

3. Developed

Good example: Developed guidelines for 50 users to understand and use the new process for client handling.

Bad example: Developing guidelines to use the new process for client handling.

The selector and the interviewer will be amused with questions like: What guidelines? When? For whom?. The good example here answers these queries and shows your output rather than your responsibility.

4. Eliminated

Good example: Eliminated the use of thick brown tape for sealing the packages to reduce the cost by over 15 per cent.

Bad example: To eliminate wasteful of resources.

The selector will again have the questions like ‘what type of resources?’, ‘how did your action help?’

5. Forecast

Good example: Forecast a downturn in the FMCG business because of economic slowdown. Suggested measures to combat it and achieve the quarterly target.

Bad example: To analyse and forecast the market.

6. Introduced

Good example: Introduced a new process to handle queries from potential customers to increase the conversion rate by 60 per cent.

Bad example: Introducing a new process to handle client queries.

7. Modernised

Good example: Modernised a chain of 15 retail outlets across three states to meet the taste of urban youth.

Bad example: To modernise the look of retail chain outlets.

8. Organised

Good example: Organised reseller conferences in three cities while maintaining a close co-ordination with three internal departments and four vendors.

Bad example: Organising events like exhibitions and retailer conferences.

9. Recommended

Good example: Recommended five new ways to ensure that the company is able to roll out the new version of its ‘small car’ before the launch of Nano [Images].

Bad example: Recommending ways for the company to roll out its new ‘small car’

10. Secured

Good example: Secured first position in the university while pursuing MBA course and helped the college stand at the top of the list.

Bad example: University topper during MBA.

How do I use these in my CV?

  1. List your responsibilities and achievements.
  2. Find the one word that best describes your role in that situation such as manage, co-ordinate, plan, advise etc.
  3. Begin your sentence with the past tense of the verb you decide to use for every responsibility.
  4. Add some figures and facts to your statement.

If you are stuck with finding a good word to describe your action in the CV, take a look at this list of some frequently used action words.














































Teamed Up

H1-B visa on Rediff

February 7, 2009

Applicants and employers who plan to avail of H-1B visas to the United States, which are subject to fixed quotas, for the fiscal year 2010, should begin preparations early.

The United States Citizenship and Immigration Services (USCIS) will begin accepting H-1B visa petitions for the fiscal year 2010 from Wednesday, April 1, 2009.

The earliest that applicants can begin working on these visas in the US is October 1, 2009, which is the start of FY 2010. Last year, the quotas were exhausted within the first week of the filing season.

As part of the H-1B process, the employer is required to receive a certified Labor Condition Application (LCA) from the United States Department of Labor (DOL) before the H-1B petition can be filed with the USCIS. However, it is important to note that the processing time for the H-1B visas is likely to increase dramatically this year.

Currently, the LCA is produced and certified almost instantly upon electronic submission to the DOL’s web-based application centre. The new certification process for the LCA may possibly take seven or more days if the changes are introduced.

Earlier it was possible to expedite last minute requests for new employees, but this will be highly unlikely if the process is delayed, though there is no intimation of that as yet.

The H-1B quota

The USCIS grants 65,000 H-1B visas each year and since 2004 an additional 20,000 H-1B visas have been granted to individuals with Master’s or higher degrees obtained from the US. Out of the 65,000 visas, a special quota is reserved for Chile and Singapore nationals under free trade agreements between the US and those countries.

In recent years, the demand for H-1B visas has far exceeded the supply. For instance, in FY 2008, the USCIS reported that it received 133,000 petitions on April 2 and April 3. In 2007, April 1 fell on a Sunday. For the very first time, the USCIS conducted a computer-generated random selection of petitions filed on the first and second day of the filing period to select only a limited number of cases allocated under the H-1B cap.

The USCIS also announced that the Master’s cap for FY 2008 was reached on April 30, 2007 and petitions that were received on April 30, 2007 under the Master’s cap were also subject to a random selection process.

With regard to applications for FY 2009, the USCIS announced that it had received more than the number of H-1B petitions for both the 65,000 and 20,000 cap during the 5-day filing period. In addition to providing a 5-day window when the USCIS accepted applications, the USCIS also stipulated that if it received more than one H-1B petition on behalf of the same alien for the same position both the applications would be dismissed and the fees forfeited.

The numerical limitation of 65,000 does not apply to a non-immigrant who is sponsored for an H-1B visa by an institution of higher education and non-profit entity related to or affiliated with any such institution.

Nor would it apply to an H-1B visa petition that has been filed by a non-profit research organisation or a governmental research organisation.

The quota restrictions do not apply to J-1 physicians who have been sponsored for a J-1 waiver by a federal or state agency or to H-1B extension requests. The quotas for Singapore and Chile have never been reached to date.

The USCIS reportedly plans to issue a rule in the spring or summer of 2009 to streamline the H-1B paperwork required to participate in the fiscal year 2010 lottery.

The rule would propose a ‘pre-registration’ system with a shorter application required for the lottery, and the full H-1B petition required for lottery winners. However, that system will not be in place for this April’s H-1B rush.

The H-1B process

An employer who needs the temporary services of a foreign national must demonstrate that both the job requirements and the foreigner’s credentials or experience are ‘professional.’ Beneficiaries who have four-year Bachelor’s degrees, equivalent to the US Bachelor’s degrees, usually qualify as professionals.

Beneficiaries from India, where a Bachelor’s degree usually involves three years of college education, require an additional year of education or experience. Individuals with foreign qualifications must obtain credentials evaluations and/or translations if required.

The employer must also meet Department of Labor (DOL) requirements (described below) and file a petition with the USCIS for permission to employ the qualifying foreign national. If the employee is out of the country, he or she must also apply for the visa at a US Consulate abroad upon receiving approval of the petition from the USCIS.

The Labor Condition Application

Prior to filing the H-1B petition with the USCIS, the employer must certify to the DOL with respect to the foreign worker, that

(1) it will pay the higher of what it pays its own similar workers or what similar workers in the area are paid (whichever is higher);

(2) the working conditions of its US workers are not adversely affected;

(3) there is no strike/lockout at the worksite nor in the occupation for which a foreign professional is sought; and

(4) it has given notice to current employees that it is seeking to hire an H-1B professional.

The DOL certifies receipt and acceptance of the attestation in order to create a public record and the original signed copy of this should be filed with the petition. The employer must also post the labor condition application for 10 days and maintain a wage file that is open to the public.

There are special provisions that apply to H-1B dependent employers. Generally, US employers of 51 or more individuals whose workforce comprises 15 per cent or more H-1B workers are considered dependent employers.

Smaller employers are allowed a slightly higher ratio of H-1Bs to their total workforce. H-1B dependent employers must additionally attest that they will not displace a U.S. worker 90 days before and after filing the visa petition for a foreign worker.

Further, they must attest that they have taken good-faith steps to recruit in the US using industry-wide standards and that they have offered the position to any US worker who applies and is equally or better qualified than the H-1B worker.

Dependent employers who pay H-1B workers a salary of $60,000 or who employ a person with a Master’s degree are exempt from the additional H-1B dependant employer attestations.

Employers must follow through on attestations or they are in violation of law and could be required to pay wages, incur civil penalties and be debarred from the program. The DOL initiates investigations of employer practices through both a formal complaint and its own investigation processes.

Filing the petition with the USCIS

The employer must submit a request to the USCIS, proving that it has completed the Labor Condition Application process and demonstrating that both the employer and the foreign professional qualify for the visa category. The employer must submit a fee of $320.

In addition, all employers applying for H-1B visa petitions must pay the new $500 ‘fraud prevention’ fee for each petition seeking an initial grant of H-1B non-immigrant classification or those petitions seeking to change an employer within those classifications.

The $500 fee will not apply to amendment or extension petitions filed by the same employer. The employer may expedite the petition through premium processing, by paying an additional $1,000 filing fee whereby the USCIS will adjudicate the case within 15 days.

As of December 8, 2004, employers must also pay a supplementary fee of $1,500. If the employer has 25 or fewer full-time employees including any affiliates or subsidiaries must pay $750.

Some employers may be exempt from the training fee. Employers will also be exempt from the training fee if they are filing a second H-1B extension on behalf of the foreign national employee.

In the petition the employer must demonstrate

(1) the need for someone who is a professional,

(2) that the job requires a worker with at least a bachelor’s degree, and

(3) that the prospective employee has the required degree or an equivalency analysis for a foreign degree along with any other required qualifications.

H-1B visa application

If the professional is already in the US in another visa category or status, the professional can file petition with the USCIS for a change of status to H-1B.

The new status will be indicated on the person’s I-94, but is not a travel document. In order to travel and re-enter the US in H-1B status, a visa must be obtained at a US Embassy or Consulate abroad.

Once the petition is approved by the USCIS, if the professional is outside the US, he or she must apply to a US consulate for an H-1B visa.

The US consular officer adjudicates the application to determine the alien’s admissibility before granting the visa.


Although certain categories of workers are exempt from the H-1B cap, there is no doubt that the 65,000 H-1B visas available for most jobs in ‘speciality occupations’ will be used up by mid-summer. With that in mind, employers desiring to hire professional workers under the H-1B category would do well to file their petitions early, or risk being shut-out until April 1, 2010 when the quota reopens for FY 2011.

Despite the economic downturn it is expected that like every year, there will be a mad scramble for available H-1B visa numbers.

HR Agonies

May 1, 2008

FROM: Ms. Pat Smith, Human Resources Director
TO: Everyone
RE: Christmas Party
DATE: December 1

I’m happy to inform you that the office Christmas Party will take place on December 23, starting at noon in the banquet room at Luigi’s Open Pit Barbecue. No-host bar, but plenty of eggnog! We’ll have a small band playing traditional carols… feel free to sing along. And don’t be surprised if our General Manager shows up dressed as Santa Claus!

FROM: Pat Smith, Human Resources Director
DATE: December 2
RE: Christmas Party

In no way was yesterday’s memo intended to exclude our Jewish employees. We recognize that Chanukah is an important holiday, which often coincides with Christmas, though unfortunately not this year. However, from now on we’re calling it our “Holiday Party.” The same policy applies to employees who are celebrating Kwanzaa at this time. Happy now?

FROM: Pat Smith, Human Resources Director
DATE: December 3
RE: Holiday Party

Regarding the note I received from a member of Alcoholics Anonymous requesting a non-drinking table…you didn’t sign your name. I’m happy to accommodate this request, but if I put a sign on a table that reads, “AA ONLY,” you wouldn’t be anonymous anymore. How am I supposed to handle this? Somebody?

FROM: Pat Smith, Human Resources Director
DATE: December 7
RE: Holiday Party

What a diverse company we are! I had no idea that December 20 begins the Muslim holy month of Ramadan, which forbids eating, drinking and intimacy during daylight hours. There goes the party! Seriously, we can appreciate how a luncheon this time of year does not accommodate our Muslim employee’s beliefs. Perhaps Luigi’s can hold off on serving your meal until the end of the party, or else package everything for take-home in little foil swans. Will that work? Meanwhile, I’ve arranged for members of Overeater’s Anonymous to sit farthest from the dessert buffet and pregnant women will get the table closest to the restrooms. Did I miss anything?

FROM: Pat Smith, Human Resources Director
DATE: December 8
RE: Holiday Party

So December 22 marks the Winter Solstice…what do you expect me to do, a tap-dance on your heads? Fire regulations at Luigi’s prohibit the burning of sage by our “earth-based Goddess worshipping” employees, but we’ll try to accommodate your shamanic drumming circle during the band’s breaks. Okay???

FROM: Pat Smith, Human Resources Director
DATE: December 9
RE: Holiday Party

People, people, nothing sinister was intended by having our principal dress up like Santa Claus! Even if the anagram of “Santa” does happen to be Satan,” there is no evil connotation to our own “little man in a red suit.” It’s a tradition, folks, like sugar shock at Halloween or family feuds over the Thanksgiving turkey or broken hearts on Valentine’s Day. Could we lighten up?

FROM: Pat Smith, Human Resources Director
DATE: December 10
RE: Holiday Party

Vegetarians!?!?!? I’ve had it with you people!!! We’re going to keep this party at Luigi’s Open Pit Barbecue whether you like it or not, so you can sit quietly at the table furthest from the “grill of death,” as you so quaintly put it, and you’ll get your #$^&*! salad bar, including hydroponics tomatoes…but you know, they have feelings, too. Tomatoes scream when you slice them. I’ve heard them scream, I’m hearing them scream right now!

FROM: Karen Jones, Acting Human Resources Director
DATE: December 14
RE: Ms. Pat Smith and Holiday Party

I’m sure I speak for all of us in wishing Pat Smith a speedy recovery from her stress-related illness and I’ll continue to forward your cards to her at the sanitarium. In the meantime, management has decided to cancel our Holiday Party and give everyone the afternoon of the 23rd off with full pay.

IT industry has its own Hiranyakashyap to battle

April 25, 2008

Nasscom Leadership Summit has always been a place for good story-telling and provocative thoughts. This year, the spark came not from a software veteran or a BPO moghul, but a captain of an old economy industry. Anand Mahindra, vice chairman and managing director of Mahindra & Mahindra drew from mythology to call for game-changing innovation from the IT industry.

One of the tasks we at the Mahindra Group have set ourselves is to aspire to be recognized as the most customer-centric organization in India, and why not, in the World!

In order to walk the talk, every time I’m asked to speak at a conference, I have made it a default option to ask what the audience–my customers–might expect of me.

And so I found myself wondering what this conclave of IT wizards expects from a predominantly right-brained character like myself. You certainly haven’t called me here to deliver a sermon on technology. And I wouldn’t even risk doing that with Nandan (Nilekani) and Kiran (Karnik) sharing the dais!

Of course, I might have been able to do that by getting one of my IT colleagues to write this speech, but then it would have been comprehensible to you, but incomprehensible to me!

And although the title of this session is ‘Building a Knowledge Economy for Growth’, I believe that a) All of you out there have helped build the foundations of a knowledge economy, so again, you don’t need me to pontificate to you about that and b) I think there are some urgent pressures and imperatives the industry has to deal with at this point.

So, I’m going to talk about something completely different: I will talk about the Trimurti.

Most of the Indians in this audience will know the Trimurti – the trinity in Indian mythology of Brahma the creator, Vishnu the sustainer and Shiva the destroyer. There is a wonderful depiction of this in stone, just ten kilometers across the bay, at Elephanta. Both as a businessman, and as someone who tends to see life in visual images, the Trimurti reminds me of India’s IT industry. Think of it.

You people have gone through a stage, where like Brahma, you created something out of nothing. You created a new and global industry. You created a service sector that is today, a major pillar of our GDP. But most importantly, you created a perception of a new India, both in the world and in Indian hearts and minds.

CK Prahalad once told me that in universities in America today, there are almost unfairly high expectations from Indian students, because there is a huge perception that all Indian students are brilliant, outstanding. You created that perception. And within India, what you created was self-belief. You showed us what Indians could do, and now the rest of India believes that Indians can do anything. Brahma created a physical landscape; you sowed the seeds of a new mental and psychological landscape. In that sense, you are truly the Brahmas of the age of liberalisation.

But creation is only the first phase. You then have to move on to the next phase of sustaining that creation – to the realm of Vishnu the preserver. Creation is a one-time affair. Sustaining that creation is obviously a longer haul, subject to many attacks and crises. Perhaps that is why Vishnu comes not in one, but in ten incarnations.

Every time there is a new danger, he changes his avatar to a form best suited to meet that danger. At various times he has come as a fish, as a tortoise, as a dwarf. But his most interesting avatar came when he had to fight the demon Hiranyakashyap. Hiranyakashyap was a bad guy, who had obtained an amazing boon from the gods. Neither man nor beast could kill him; he could not be killed by daylight or at nighttime, within his home or outside it, on the ground or in the sky. All this made him pretty invincible – he went on a rampage, and only Vishnu could tackle him.

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The IT industry today faces challenges every bit as complex as those Hiranyakashyap posed for Vishnu. It is hit by a macroeconomic tsunami of adverse currency changes, rapidly escalating costs in both salaries and infrastructure and inadequate talent pools below the tier 1 and 2 institutions.

At the Company level, firms are begin to feel the penalties of poor differentiation and lack of focus (trying to be all things to all people); and an over-emphasis on high volumes and price competition.

Suddenly, the industry seems to have fallen off its pedestal; You are facing your very own Hiranyakashyap.

It’s interesting to see how Vishnu dealt with him. How do you destroy someone who can’t be killed by man or beast, inside or outside, by day or night etc etc. The demon pretty much had all bases covered. So Vishnu took on the Narasimha avatar to bypass the boon. Narasimha was a hybrid creature, half man half lion, and therefore neither man nor beast.

He killed Hiranyakashyap at twilight, which is neither day nor night. He killed him in the courtyard, which is neither inside a house nor outside it. And he killed the demon by placing him across his knee and tearing him apart, thus circumventing the terms of the boon that he could not be killed either on the ground or in the sky. Now that’s what I call an innovative algorithm!

So what are the lessons for the IT industry in this story? Well, the first thing Vishnu did was to reinvent himself. It was not the gentle and contemplative Vishnu who fought Hiranyakashyap – it was the fearsome Narasimha avatar. Vishnu reinvented himself to suit the circumstances. The circumstances have changed drastically. Reinvent yourselves.

Do I have all the answers on the modes of re-invention? No, obviously not, otherwise I’d be out there filing patents, although I can suggest two broad approaches.

First, why don’t we design business models that challenge traditional industry approaches and then transform our organizations, people and processes to execute. If we simply keep knocking on the doors of clients with our traditional offshoring options, we’ll meet the fate of hearing aid salespersons: our best customers won’t hear the doobell!

For example, software-on-demand and open source models changed the rules of the software game. Can we not try to change the rules of the game this time around? Why didn’t we invent Zoom technology or Virtualisation? Thus far, India’s brand of innovation has been identified with the IT industry, but is it truly innovative. Is it really game changing? Ironically, you can now look to the old smokestack industries for inspiration.

A few weeks ago, an Indian car company made a game-changing move. Maybe the Nano will ultimately not retail for a hundred thousand rupees. Maybe it won’t have great margins, or replace as many motorcycles as it would like to, but it was a game changing move; it fired a shot that was heard around the world. Can the IT world make any such claim?

There was an old saying, apparently adopted by the IT industry that the secret of success is to jump every time opportunity knocks. And how do you know when opportunity knocks? You don’t, you just keep jumping!

So when are we going to stop simply jumping every time a client seems to sneeze, and actually create products and IP that become their own opportunities?

Let’s look at new areas where India may have natural advantage. I remember C.K Prahlad telling us that we didn’t realize how important it was to leverage emerging innovation ecosystems in our country. He gave us the example of how, due to a fortunate coincidence, India’s IT and automotive industries were situated in roughly the same geographic clusters. So why wasn’t, according to Michael Porter’s competitive theories, a world beating automotive telematics industry taking shape here.

Why aren’t IT companies using the massive potential of India’s soft power, the film and TV business to exploit technological dominance of what Telco’s call the ‘last mile’ but is actually the ‘first mile’ in the brave new interactive world?

Secondly, why don’t we try to focus on a vertical industry (e.g., telecom) or horizontal domain (e.g., supply chain management) selecting the key dimensions of competitive differentiation – product vs. service, breadth vs. depth, speed of delivery, customer service responsiveness, fixed or outcome-based pricing, proprietary technology or intellectual property, and so on.

And let’s be prepared to make hard decisions along the way – change people who don’t fit, walk away from businesses that doesn’t fit.

It’s essential, while attempting this, however, to recognize that focus, differentiation and brand building require time and investment. Selling value or doing business differently than the norm tends to elongate sales cycles, which tends to put pressure on cash flow and we need to resist the temptation to broaden our offerings or slash prices just to win the business and keep people busy.

Along with re-invention, during the course of reinventing himself, Vishnu figured out the loopholes in the boon, and regrouped his physical and mental aspects to take advantage of these loopholes. That’s something the IT industry can do as well. It’s often been pointed out that in the Chinese word for crisis is also the Chinese word for opportunity I love that mindset. I truly believe that the adverse rate of the dollar can be viewed as the glass half empty or the glass half full. Sure it affects margins. But it’s also a chance to take advantage of the loophole and buy yourselves what you don’t have, so that you can regroup your structure to meet the challenge.

To me the fact that our currency is more valuable and our price earnings ratios are still higher than average, means that we can acquire the front-ends and the large IT businesses that we never thought we could before. And the bigger the better. If people are egging us on to leapfrog, then they should also cheer as you bid for companies that seem bigger fish than you. It’s happening all the time today in the manufacturing sector—Tata Corus being the stellar example—and we at Mahindra, while starting from scratch, have inorganically compiled together a portfolio of acquisitions that make us the fourth largest steel forging company in the world today.

This is not without historical precedent. If you look at Japan and South Korea, both of them went through a phase of enduring the worlds’ skepticism, then painstakingly building strong and competent domestic businesses, and then on the back of global liquidity support and strong price earnings ratios, compressing time by acquiring global firms and their customer credibility.

In effect, by acquiring the strengths and skill sets you need, you will regroup your profile and create a new entity, which can vanquish your challenges as effectively as Vishnu vanquished Hiranyakashyap.

And finally, while reinventing yourselves, you will have to bring in some of the aspects of the third element of the Trimurti – that of Shiva the destroyer.

Destroy for example the premise that cost arbitrage is the way to go. Recognize that the low cost, high volume offshore outsourcing battle has already been fought and won. Often, when strategic frames grow rigid, companies, like countries, tend to keep fighting the LAST war. If you are not already on the winners list, you need to think of other ways to compete on value and differentiation, rather than price and scale.

Destroy the premise that success comes only from size, and desist from comparisons with other Indian companies. There are still many IT companies in India who define success as “we want to be one of the top ten Indian IT companies”. Why not, for example, “we want to be the world’s #1 banking back office solutions provider”?

And lastly, perhaps the time has come to destroy the notion that the world may be your oyster but India is not. There is a huge domestic market in middle class and corporate India that has not been plumbed. Even selling to the bottom of the pyramid is profitable today. But it needs a creative destruction of the current mindset and a re-think on many of the assumptions we hold dear.

So, in conclusion, perhaps there really isn’t that much distance between avatars in the mythological sense and avatars in the technology sense. Perhaps they are both symbolic expressions of the same reality. In their different ways, they both underline the same message – that it is necessary in any situation to reinvent, regroup and re-think our way out of whatever challenges confront us.

I’d like to close with one of my favourite quotes—such a favourite, that I can’t even remember where I first read it:

My father thought the world would be same;

My children, however, wake up EVERY day thinking the world will be different.

Let’s begin emulating our children. Time to wake up and make the world different.

(Anand Mahindra’s speech at Nasscom Leadership Summit on February 13 th , 2008)

Peter Drucker quotes

February 9, 2008

People who don’t take risks generally make about two big mistakes a year. People who do take risks generally make about two big mistakes a year. Peter F Drucker

Effective leadership is not about making speeches or being liked; leadership is defined by results not attributes. Peter F Drucker

There are an enormous number of managers who have retired on the job. Peter F Drucker

Plans are only good intentions unless they immediately degenerate into hard work. Peter F Drucker

So much of what we call management consists in making it difficult for people to work. Peter F Drucker

A manager is responsible for the application and performance of knowledge. Peter F Drucker

Efficiency is doing things right; effectiveness is doing the right things. Peter F Drucker

Time is the scarcest resource and unless it is managed nothing else can be managed. Peter F Drucker

Quality in a product or service is not what the supplier puts in. It is what the customer gets out and is willing to pay for. A product is not quality because it is hard to make and costs a lot of money, as manufacturers typically believe. This is incompetence. Customers pay only for what is of use to them and gives them value. Nothing else constitutes quality. Peter F Drucker

Teamwork is neither ‘good’ nor ‘desirable’. It is a fact. Wherever people work together or play together they do so as a team. Which team to use for what purpose is a crucial, difficult and risky decision that is even harder to unmake. Managements have yet to learn how to make it. Peter F Drucker

The most important thing in communication is to hear what isn’t being said. Peter F Drucker

There is nothing so useless as doing efficiently that which should not be done at all. Peter F Drucker

The computer is a moron. Peter F Drucker

Economic & Business Focus: Global Labor Arbitrage Resets Wages

February 9, 2008

Offshoring will flatten wages in the United States and other advanced economies.

Global labor arbitrage — the practice of constantly replacing expensive labor in one location with cheaper labor in another — has been a cornerstone of corporate strategy for more than a century. This strategy matured over the past decade as technology and higher levels of development in the low-wage nations enabled their workers to take on service jobs and knowledge work; no longer is the practice limited to low-level production jobs. As developing countries provide an increasingly skilled workforce, developed nations’ ability to differentiate themselves is dissolving, and the companies operating in those countries no longer need to pay their workers a premium. The most widespread and lasting impact of the maturation of global labor arbitrage is the decline in real wages in the developed nations. CFOs of U.S. companies can prepare now for a permanent resetting of wages for many workers in the upper salary ranges.

Increased global competition and low pricing power are driving the more aggressive forms of arbitrage: overseas sourcing, offshoring and foreign direct investment. In the IT industry, these practices are already moving into their second generation; Indian companies that took work from the United States and Europe are now offshoring less-skilled jobs to lower-cost locations such as China and Malaysia. IT wages in the United States dropped by an average of 3 percent in 2004.

Although corporations around the world increasingly practice labor arbitrage, most are still reluctant to call it what it is. TeleTech Holdings Inc. is one of few companies that use that term. The Englewood, Colo.-based company operates 66 customer management centers (CMCs) staffed with 33,000 employees spread over 16 countries, including 10,000 in the low-wage regions of Asia and Latin America. “TeleTech was one of the first customer management providers to successfully implement a labor arbitrage strategy more than 7 years ago,” says Dennis Lacey, executive vice president and CFO. “Since then, we have expanded our labor arbitrage strategy globally, providing our clients high-quality, lower-cost customer management solutions in various languages and from many countries, including India, Argentina, Canada, Mexico and the Philippines.”

Call-center workers in low-wage regions make 10 percent to 12 percent of what U.S. call-center workers earn, according to Datamonitor. That firm predicts wage inflation in the offshore markets and wage deflation in the United States as more call-center jobs move abroad. “Labor-arbitrage customer management centers have a lower cost profile than comparable CMCs in the United States, which lowers the overall cost to serve,” Lacey says. Although wages in the United States have flattened, wages in India and the Philippines are rising rapidly. “Wage inflation is a natural component of a growing and evolving industry, particularly in developing countries,” he notes.

Expanding Cost Differential

The labor cost differential between the developed and developing nations is so large that rapid wage increases in the developing nations will not reduce the cost savings created by global labor arbitrage for the foreseeable future. According to industry analysts at The Boston Consulting Group Inc., wages will rise 5 percent to 10 percent annually in the developing nations that attract offshoring and 1.5 percent to 2.5 percent in the United States, Japan and most of Europe.

However, the labor cost advantage in the developing nations will actually expand in the short term. If wages in China continue to rise at their current average of 8 percent annually, the average production worker will still earn just $1.27 an hour in 2009, a 47 cents-an-hour increase over 2003, compared with $25.34 per hour for a U.S. worker — $3.48 per hour higher than in 2003. The savings on labor costs for U.S. companies that use Chinese workers will rise from $21.06 per hour in 2003 to $24.07 in 2009.

Real wages will grow rapidly in the developing countries at the forefront of the offshoring movement, according to Robert E. Kennedy, executive director of The William Davidson Institute and professor of business administration at the University of Michigan’s school of business in Ann Arbor. “But this is good for the United States,” he notes. “Ask yourself: Is the U.S. better off if the average Indian makes $500 per year or $5,000? The obvious answer is $5,000 — India’s cost advantage would be lower, and Indians would have more income to spend on U.S. goods and services. If you walk around offshoring complexes in India, China and Indonesia, you see that they are filled with U.S. computers and telecommunications equipment, that the workers spend the day surfing U.S. Web sites, and that they aspire to U.S. educations and holidays.”

Lower labor costs abroad will continue to drive trade, foreign investment and offshoring, despite protests by the workers who are displaced in the developed nations. “Everyone who uses a General Electric product benefits from the fact that GE employs high-skill, low-wage workers in India doing everything from answering phones to software development,” says Kennedy. Although the overall benefits of global labor arbitrage vastly out-weigh the costs imposed on displaced workers, the costs are more visible because they are borne by an easily identified group, he notes.

Wage Compression

Now that global labor arbitrage destinations such as India and China are prepared to compete on the basis of both low wages and high tech development, the developed countries are quickly losing their only remaining competitive advantages: technology and skills. Nations that specialize in providing highly skilled labor cannot sustain their advantage once a global labor market for skilled workers emerges. Labor-intensive production, including relatively skilled work, is already offshored or marked for offshoring. Only services that must be performed close to home, such as health care, and niche knowledge-based fields, such as tort law, are now locked into specific geographic locations. All other sectors are subject to arbitrage and the resulting downward pressure on wages.

The shift toward lower wages in the developed nations is most evident in the compression of real wages and the bifurcation in hiring that now characterize U.S. employment trends. When hiring here finally resumed in 2004 after three years of stagnation, low-end jobs accounted for almost half of the job growth — double their share of the workforce, according to research conducted by Stephen Roach, chief economist and director of global economic analysis for Morgan Stanley in New York City. The compression of real wages that began soon after the 2001 recession and continues today is the sharpest ever recorded by the U.S. Department of Labor, Bureau of Labor Statistics. Although U.S. consumers may benefit from lower prices for goods generated by using cheaper labor abroad, the benefits will be less noticeable as the recent bout of equity-financed consumer spending comes to a necessary end.

Knowledge-based and niche industries will keep some upward pressure on wages for the highest-value-added positions in the developed nations. When the Lenovo Group, China’s computer giant, bought IBM’s personal computer division in December 2004, it immediately offshored all the high-level managerial work back to the United States. This is clearly a temporary arrangement to fill the gap while China raises managerial skill levels, but that process will take many years.

The wages of U.S. workers rose for decades, supporting a steady increase in the standard of living. But now, wages have reached a plateau, and further improvements in living standards will depend more on falling prices than on the traditional annual wage hike. CFOs can shape long-term planning around lower wages here, higher wages in offshore locations and an ongoing need for global labor arbitrage as a prerequisite for competitive success.

Other Reasons for Falling U.S. Wages

Substantial downward pressure on wages in the United States stems not only from offshoring and overseas sourcing, but also from regulatory shifts and massive technological changes that lower the skill levels required for what were once relatively high-paying jobs. In the financial services sector, for example, many jobs have been offshored, but many more have been fundamentally changed by technological and regulatory developments.

“Because of a number of structural and legislative changes in the financial services industry, I am seeing an increase in commoditization and a decrease in rates of wage growth and, in some cases, actual wage decreases,” says Richard Lipstein, principal with Boyden Global Executive Search in New York City. “Increased use of technology to trade stocks by asset management institutions is leading to lower commission rates and less need for human traders. This has led to layoffs among the trading community and lower compensation for those still employed in this activity.”

Regulatory changes have forced the restructuring of equity research analyst positions and driven down compensation for these jobs by 25 percent to 30 percent over the past four years, Lipstein notes. “Every firm has instituted material analyst layoffs. What this industry is experiencing is no different than most of the rest of corporate America. It has just taken several decades to have to deal with high labor costs and major restructuring.”

Technological displacement is a reality for Wall Street traders and offshore call-center workers alike. Datamonitor reports that speech-enabled self-service technology may soon eliminate some jobs in offshore call centers. The cost of a call serviced through speech automation is 15 percent to 25 percent of the cost of a call handled by an agent in India.

Originally printed in the April 2005 issue of Business Finance

Why do employees leave

February 9, 2008

Specifically, employees typically leave for five reasons:

1. The confidence factor. Organizations often look like they’re more out of focus when they’re seen internally, rather than externally. It’s not always clear to employees what the strategy is, and even when there’s a clear-cut strategy, it might not be apparent that it’s linked to the long-term mission and health of the organization. When a key employee loses confidence and hope, he or she may begin to think the grass is greener in another company, where there seems to be more focus.

2. The emotional factor. Key employees need to be recognized, rewarded and developed. When employees leave an organization, they often site lack of recognition, inadequate rewards and too little focus on their personal development as reasons to move on. When employers fail to fulfill these needs, they inevitably conclude they have no choice but to move on.

3. The trust factor. A feeling often expressed upon departure is: “There were too many broken promises and commitments that weren’t kept. They weren’t loyal to me. Why should I remain loyal to them?” Trust is a two-way street–it begins with the employer, and employees respond in kind. Psychologists refer to this phenomenon as transference–the ability of one person to transfer his or her care to another. A broken promise, whether implicit or explicit, breaks the underpinnings that support the trust paradigm.

4. The fit factor. Key employees who dedicate themselves to their organizations need to feel as though they fit–that their values and principles match those of the organization. We frequently hear exiting employees say, “I didn’t fit in with the team like I used to.” It’s much easier to leave a manager or team that you don’t like, or more importantly, that you believe doesn’t like you.

5. The listening factor. Key employees need to believe they’re being heard. This is perhaps the most frequently cited reason why employees leave an organization. They believe they’re not being heard. Failure to say exactly what’s needed and expected of them becomes a hurdle that tires out employees, and ends in statements like, “It isn’t worth it anymore.”

Philip J. Harkins
Excerpt – October 1998 Workforce Magazine

Key Competencies-Human Resource Professionals

February 9, 2008

Relationship Focused: approachable; relates easily to diverse groups and individuals; builds and develops relationships.

Customer Focused: focused on all aspects of service and product delivery; always knows the customer comes first.

Organizational Skills: able to set priorities; time and meeting management skills; able to delegate.

Problem Solving: ability to weave through necessary channels to accomplish outcomes in complex settings; understanding of processes and quality improvement.

Assessment of Talent: ability to judge and assess talent, recruit and select staff appropriate to current and future organizational needs; appreciation for and emphasis on developing a diverse workforce.

Integrity: forthright; direct; widely trusted.

Intelligence: ability to grasp complex concepts and determine courses of action.

Energetic: action oriented; hard working; likes challenges.

Active Listening: ability to absorb and translate others’ statements into objective responses and actions; ability to give and receive feedback in an appropriate manner.

Composure and Professionalism: ability to maintain professional demeanor in difficult or stressful situations; patience with customers; ability to diffuse anger and deal with difficult customers.

Presentation Skills: ability to present and convey information in a wide variety of settings.

Flexibility: ability to cope effectively with change and uncertainty; ability to reprioritize quickly; ability to maintain a balanced perspective and see all sides of an issue.

Vision: ability to see the ‘big picture’ within the industry, the organization and the function now, and in the future; ability to translate a future state for others and instill a sense of vision in them; ability to motivate others.

Political Awareness: sensitive to political situations; able to assess political climate and how it affects responsibilities.

Adapted from competency research by Ellen Wilson, Associate Vice President for Human Resources, SUNY Upstate Medical University, Spring 2000.