Salary hikes will be minimail for 2009

Brace up for a bad increment season. The annual Salary Increase Survey by human resource firm Hewitt Associates, India Inc will see salaries rising by only 8.2 per cent – the lowest in six years.

It could be worse. Hewitt warns that another 2 percentage pints could be snipped off the raise. Those who get this should consider themselves lucky – sort of. For, at the top management levels, there could actually be a salary contraction by as much as 40 per cent.

In most cases the raise will not even cover the inflation rate if the consumer price index were to be taken as the yardstick. (On this basis, inflation was 10.8 per cent in January.) In other words, your ‘real’ income in 2009 could be less than last year.
Some sectors that handed out the best raises last year will be the stingiest. Among them are retail (expected to give only 5.3 per cent raise), infotech (5.7 per cent), banking & financial services (6.3 per cent), oil & gas (7.3 per cent) and entertainment & publishing (7.5 per cent). The last three were expected in the 2008 Hewitt report to be the most generous, handing out raises of 17.5 per cent, 16.2 per cent and 16.9 per cent, respectively.

Ravi Dhariwal, CEO, Bennett Coleman, declined to comment to Financial Chronicle on why media was seen as tightfisted this year. A K Balyan, human resources director of ONGC only said, “I don’t know how they (Hewitt) have arrived on these figures.”
Ganesh Natarajan, Nasscom chairman, said, “The raises in IT will be in the range of 7 to 8 per cent, which is as high as any other service sector.”
Among the sectors Hewitt expects to be most generous this year are pharmaceutical (giving an average raise of 13 per cent), telecom (11.3 per cent), fast moving consumer goods and durables (11 per cent), chemicals (10.9 per cent) and hospitals (10.8 per cent).

Many in these industries disagreed with the findings of the report. Amar Lulla, Cipla joint managing director, said, “I don’t think salary hikes will be so much. At the most they will be around 5 to 7 per cent (in pharmaceutical sector).”
Harpal Singh, Fortis Healthcare chairman, thought salaries in healthcare would grow by between 7 and 11 per cent. Dabur and Britannia did not respond to our queries.
Surprisingly, Hewitt does not have data on the real estate sector, which, it said last year, would see a 25 per cent salary hike. The reality was far from this. Pradeep Jain, chairman of Parshvnath Developers, is on record that salaries at the senior management level in real estate companies had, in fact, gone down by between 15 and 20 per cent.

The report indicates that 16 per cent of 480 companies surveyed have frozen salaries and 12.6 per cent are considering retrenchment, according to Sandeep Chaudhury of Hewitt.

The report also says that salaries at the top levels are the most vulnerable. The management may have to take actually take a cut of 40 per cent, and senior and middle management will their pay shrink by 39 per cent.


Author - Ronojoy Banerjee,Jayashree Maji also contributed to this article.
Source : mydigitalfc.com

Pay rises in US for 2009

Someone Is Getting a Raise—but Perhaps Not You

To the employees who thought 2009 was the year of the pay freeze: You were wrong, at least so far.

Contrary to the sour economic mood, employers are giving salary increases averaging 3.1 percent in 2009, according to a survey of 1,000 employers by human resources organization WorldatWork. Only 10 percent of employers are freezing salaries of their workers, both WorldatWork and Hewitt Associates report in separate surveys of employers.

Still, wage growth is slowing and is expected to slow further. Companies projected lower salary increases in December than the 3.8 percent increase they had anticipated when WorldatWork surveyed companies in April about projected salary increases for 2009. As companies revise their budgets, they are lowering raises. Still, it’s better than nothing—which is what about one in 10 employers say they will give non-executive-level employees this year, according to the study.

“Organizations are scaling back, but there seems to be a very clear effort to reward employees,” said Alison Avalos, practice leader for Scottsdale, Arizona-based WorldatWork. “If you have a job … you’re in a good position to receive a pay increase this year.”

In another survey, Hewitt Associates reported that 50 percent of U.S. employers are cutting salary increases for 2009. Perhaps more important, 35 percent are laying off workers and 39 percent have instituted hiring freezes.

Other economic indicators paint a much gloomier picture: The Dow Jones industrial average has dipped to below 8,000 from a high of 14,000 in October 2007; the Consumer Confidence Index dropped to another historic low in January, the Conference Board reported January 27; and the Bureau of Labor Statistics also reported last month that in 2008, salaries increased an average of 2.6 percent, less than the projection for 2009 by WorldatWork.

Conference Board economist Ken Goldstein said changes in wages often lag behind declines in the economy and lost jobs.

“With a loss of half a million jobs in November and again in December, and very likely in January, wage growth will slow even more over the next few months,” Goldstein wrote in an e-mail.

According to WorldatWork, executives were more likely to take a pay freeze. About 17 percent of employers surveyed said executives would not receive a raise in 2009.

Across industries and regions, businesses reduced the raises they originally planned to give employees. Half the businesses responding to the survey said their company’s financial performance was worse than in 2007 and that they anticipated a decline in business this year.

Contrary to expectations, hard-hit industries such as manufacturing and finance were no more likely to reduce payouts than other industries, despite receiving federal bailout money.

“It seems those industries are no more affected than any other,” Avalos said. “Everyone has scaled down to the same degree.”

Manufacturing companies said in April that white-collar workers would receive a 3.8 percent raise for 2009, equal to the national average. In December, when the latest survey was taken, the industry reported that white-collar workers would receive an average 2.9 percent raise.

Financial companies projected in April that they would increase salaries for white-collar workers an average of 3.9 percent; as of December that number was 3.2 percent, in both cases just above the national average.

Depending on how one looks at it, the small percentage of workers who had their pay frozen will not see their overall buying power drastically reduced. The Consumer Price Index, a major indicator for gauging inflation reported by the Bureau of Labor Statistics, rose 0.1 percent as of the end of 2008 compared with a year earlier, as the drop in fuel prices brought overall costs down.

—Jeremy Smerd

Source : Workforce Management

'IBM offers jobs in India to laid-off workers'

'IBM offers jobs in India to laid-off workers'

Software giant IBM is offering its recently laid-off employees jobs in 'growth markets' like India and Russia through a new programme and will help with moving costs as well as provide visa assistance, media reports said.

Through the 'Project Match' programme, IBM is offering its outgoing workers in the US and Canada a chance to take an IBM job in India, Nigeria and Russia, CNN quoted an IBM internal document.

The company would help ex-employees "locate potential job opportunities in growth markets where (their) skills are in demand."

Should (the employees) accept a position in one of these countries, IBM offers financial assistance to offset moving costs, provides immigration support, such as visa assistance, and other support to help ease the transition of an international move," the document read.

IBM is also offering jobs in China, Brazil, the Czech Republic, South Africa, Nigeria, and the United Arab Emirates.

Source : Financial Express

Constant Gardener - Subroto Bagchi

Subroto Bagchi has been watching leaders bloom at MindTree. Actually, he is not merely watching.

Raja Shanmugam will don a new leadership role at MindTree Consulting in April 2009. He will give up being an operations manager, designated senior vice-president and head of Asia Pacific with the Bangalore-based information technology services company, and take on a pure corporate social responsibility, or CSR, activity of MindTree Foundation.

After 21 years in the IT industry, the last nine with MindTree, Shanmugam owes this sharp change in course to 16 hours, spread over four sessions of four hours each, with MindTree co-founder Subroto Bagchi, designated Gardener and director.

“Self awareness leads to mental capacity enhancement. It sharpens the emotional quotient, or EQ, that most managers with high IQ (intelligence quotient) may lack,” says Bagchi, who also gave us a written FAQ on the subject. He conducts these leadership sessions, dubbed gardening, over a three-month period.

Said to be the only one of its kind in the world, this leadership programme is unusual, and may appear unstructured, but has its own rigour and method. “It’s voluntary. There are no expectations and no deliverables. It’s about behavioural changes. In a way, it’s like interacting with a counselor,” says Shanmugam.

At the sessions, Shanmugam did not discuss how to improve his job profile. Instead, he asked himself deeper questions like who he was and what he would be five years down the line. “I was humbled to realise that the organisation was not as dependent on me as I thought. It was also a liberating experience, and I discussed this with Bagchi and hence the new role,” he says.

Shanmugam’s is among several careers, and lives, that are being manicured by Gardening. Radha R, vice-president and head-datawarehousing and business intelligence practice, has been in the IT industry for over 18 years, the last eight with MindTree.

“I was labelled a super-achiever at MindTree. I couldn’t have asked for anything better. Yet, of late, I had doubts that I was doing something worthwhile in the company. And it was then that I got a call from this company which offered me a very good role at nearly four times my current salary. Just to test my market value, I went for the interviews (12-13 rounds of them), and finally got selected. I would be lying if I said the offer was not tempting. I could have retired in peace,” says Radha.

She chose not to. She remains with MindTree and hopes to be there for many more years. “Bagchi gave me a whole new perspective. Not once did he tell me to stay back. But the interactive sessions helped me realise that my ties with MindTree were too strong to sever. I have now also learnt to connect with my 400-odd subordinates in a better way,” says Radha.

Shanmugam and Radha are two of the 35 “Top 100” leaders that Bagchi has identified for Gardening since he moved from being the chief operating officer to Gardener in April this year. The top 20 Leaders of Aztecsoft, recently acquired by MindTree, are also part of this.

But why ‘Gardener’?
Why not chief mentor, chief strategy officer, chief fun officer, or something else?

“No, I am not a chief anything,” asserts Bagchi. The company did think of head Gardener as his title, but a board member said the prefix smacked of hierarchy. The symbolism is that titles do not nourish you. “I am sending that message to our leaders. I am who I am, call me by whatever name. Titles are as meaningful or meaningless as the person holding them,” says Bagchi.

There are strong echoes of gardening in what he does. No plant reports to the Gardener; the Gardener attends to the plants in their time and space. This would mean interacting with the plants (or leaders) even during weekends, since it is voluntary and one-on-one.

“The time has come for all of us to take the idea of organisation, titles, roles and everything else in between, to the next level. The so-called modern organisation we created for ourselves and then became a product of is an extension of the factory-economy of the last century,” says Bagchi.

A leader can approach Bagchi and work with him on all kinds of issues that bother him, concern him or intrigue him, and seek the Gardener out as a sounding board, ask him questions, talk to him or demand that he share what happened in his life.

Bagchi sees people’s lives as a spectrum. At one end, it consists of “personal-personal” issues, like the relationship with a spouse. At the other are “professional-professional” issues, such as, why should one not get a higher raise or how does one get one’s boss to see to it that one gets promoted. “I would not engage at the two extreme ends of the spectrum,” he says.

For instance, Shanmugam and Radha R could have refused when Bagchi invited them for the sessions without the fear of reprisal since the sessions are voluntary.

In the first session, Bagchi listens while the participant talks. Sometimes, even they are surprised by their own answers. In the second session, Bagchi gives his perspective on the participant’s reflections and “works towards building a shared understanding of who the participant is”.

The third session deals with, “Where do we go from here?” Together, the Gardener and the Plant may decide that the latter needs more EQ, or more analytical skills, or a special project (sometimes, it is just a field visit) to enhance his self-awareness.

The fourth and final session becomes a platform for other engagements. “These four sessions, and the subsequent engagements, help me build a leadership of one,” says Bagchi.

Why only the top 100?
“Growth in any company is generally about the top 100 managers,” reasons Bagchi. The sessions have no readymade script, and the top 100 are not necessarily the best 100, says Bagchi with a wry smile. “I do hope that the top 100 do have some of our best people, though. Otherwise, we have a problem right there.”

Bagchi would engage with the top 100 and touch at least half of them in the first year. The hope is that this would make them engage differently with their own people. “When people look at themselves in new light, it is the organisation seeing itself in new light,” he says.

In future, Bagchi hopes to create many roles that would have nothing to do with seniority, title, power, or entitlement, but focus on long-standing issues and make an impact without depending on structural sanctions.

MindTree has committed to support this endeavor for five years. However, there will be a “stock-taking” in February next year.

Apart from leadership, the other key thing for an organisation is size. This requires what Bagchi terms “active deconstruction”. How do you make an organisation all the while effectively smaller, even as it becomes larger?

One way is to look at the organisation as a “community of communities”. So, people are not required to belong to or identify with a monolith. They can engage with and participate in a community of their own choice. They can define its agenda, its leadership and all that is voluntary. Volunteerism begets innovation.

MindTree has 45 such communities, which work as vehicles of innovation and a powerful support system for employees. “But they are also shy of structure and management. As Gardener, I would give time to these communities of practice in a ‘pull-push’ manner. I would work with them on the ground to question their purpose, their vision, sit with them, listen-in to their deliberations and sometimes take them outside MindTree and sometimes bring the outside world to them,” explains Bagchi.

The idea of working with the communities of practice, which, again, are voluntary, is to “deconstruct the largeness of the enterprise”.

But it's not HR…
Bagchi’s role is independent of the human resources, or HR, division’s activities. “In fact, I do not even report to Ashok Soota (MindTree’s chairman & managing director),” he clarifies.

So how does Gardening gel with the overall objectives of the organisation? Puneet Jetli, senior vice-president and head-global people function, says: “It’s the philosophy of the company, and it’s how we perceive leadership. Had it been under the HR umbrella, there could have been many constraints. Besides, the sessions are personal in nature. Bagchi is under no obligation to share any of the findings with us. This, however, is another potent platform for the holistic development of our managers into leaders.”

In the organisation of tomorrow, structure and non-structure will co-exist. Hierarchy will not go away; it will learn to work with the hetroarchy. That is why Procter & Gamble is engaging with FaceBook and creating Capessa.

“We have to extend the same rule of engagement to the internal customer. We have to redo the linkage, reinvent ways to collaborate with, expand and impact that individual very differently than during the end of factory-economy that stayed content with the term ‘white collar.’ The knowledge economy may indeed have as many people without collars as with — forget the colour though. That is how we can engage with people who visit you at Second Life (the website where you can live a virtual life) even before they send you their résumé in real life,” Bagchi explains.

Bagchi firmly believes that communities are the number one source of knowledge, and therefore meets the 45 Community Champions every quarter for half a day. “I represent a non-structural role, hence I’m welcome,” he explains. The MindTree management provides the physical infrastructure, digital content management system to feed data, collaboration tools, “and then gets out of the way”.

Bagchi gives two days to individual communities “for what they want me to do for them”. He visits campuses so that they begin to think differently. “As you can see, these are input measures. In roles like these, input measurements are more critical in the first 12 months. In addition, I want to see substantial content creation with an internal blog”.

It is important for an organisation to have distributed leadership so that some can focus on the structure and some on the non-structure. Some can focus on the hierarchy by belonging to it, and some on the hetroarchy by working with the invisible folks in the organisation. The distributed leadership must be emotionally secure — its members must have a higher sense of purpose that they are not creating fiefdom; they are creating a living organisation that is larger than the sum of its parts.

Authored by : Leslie D'Monte
Source : Business-standard.com

There is no substitute for hardwork and passion - Azim premji

There is no substitute for passion and hardwork; just follow your instinct, stop theorising and grab all opportunities that come your way. Chairman of Wipro Azim Premji had all the right advice for entrepreneurs in his inaugural address at the TiE Entrepreneurial Summit 2008, which kicked off on Tuesday.

"Failures are a wakeup call and true entrepreneurs learn life's true lessons from their failures. Learn to listen and learn to learn from youngsters who have fresh ideas and older people who have years of experience and wisdom. Don’t succumb to bribing and other malpractices; practicing unflinching integrity at all times will not only reduce your transaction costs drastically but will also win you the confidence and respect of all your stakeholders," he said.

He cited the example of the time when Wipro had to forgo 40 per cent of its profits, when they refused to bribe the Chief Minister of a State for power allocation. Although the company had to use generators for one and a half years, for as long as the Chief Minister was in tenure, they were never asked for a bribe again.

Premji said he learnt his first lesson when he took over the family business —Western India Vegetable Products Ltd. — after his father’s death in 1966. At the company’s AGM, a shareholder said Premji was not the appropriate person to head the company, as he was only 21 years old, with no qualifications or experience to back him up. "That single incident got my spirits up and I was determined to take on the challenge thrown at me. It was a passionate turbo-charge, on which my subsequent successes were built. Another lesson I learnt as a young man is that it is important to reach out to people and learn from their collective wisdom and experience. I sought advice from my mother and other wise people."

Emphasising the importance of going against the grain and thinking differently in entrepreneurship, he cited the example of his company diversifying into a relatively obscure field of manufacturing high pressure hydraulic components in 1976. "We decided not to import and build the technology from scratch. Today we are the largest independent hydraulic cylinder company with 65 per cent market share in India and have factories in Finland, Sweden and India," he said.

Entrepreneurs, he advised, should drop ideas that are too big, expensive and impractical to execute. "It is important to cut your coat according to the cloth. For instance, we wanted to manufacture scooters as the market for two wheelers was booming in the early eighties. But, we dropped the idea as it was not practical for a small company like ours."

But Wipro had a backup strategy and decided to get into Information Technology instead. "We put together an outstanding team of 300 R&D engineers and worked with IISc to come out with a great product — a mini computer. Our R&D team was five times the size of our sales and marketing team and when we decided to scale it down to 50 people, we didn’t fire the rest of the engineers but spun off another division, offering global R&D services. Today, we are the largest third party R&D services company with 19,000 engineers; it contributes 30 per cent to our total business."

Closing comments: Nothing upsets a customer more than over-committing and under-delivering. The suggestion to budding entrepreneurs is to ensure consistent value delivery. "These are interesting times when successful companies will come out much stronger while the not-so-strong will cry out to the government for help," Premji said.

The Key

* Continual leadership assessment
* Talent review, training and strategic planning processes
* Build ‘intrapreneurs’ who run separate Profit &Loss accounts in the company
* Offered ownership of the company to key individuals
* Willingness to try new things and take failure in its stride
* Explored growth in FMCG, Infrastructure and IT
* Institutionalised the process of innovation
* Embrace diversity in the workplace