Wednesday, May 31, 2006

The first Anniversary of this blog

Today marks the first anniversary of this blog. I have been a late starter on blogging. Last year I started with blogging in blogspot and MSN Spaces. In last one year I have written about 80 articles on management: Mostly marketing, Sales, and HRM. Prior to writing this blog, I have been publishing my work on geocities webspace. In last one year this blog has been well received. There have been lots of appreciation and comments on the articles. So on the first anniversary, I want to list the articles which I have posted in the past:


  1. Branding of Semiconductors
  2. Successful Online Branding
  3. Fighting Commoditization of Brands
  4. Branding on Internet
  5. Does 4Ps apply to semiconductors?
  6. Building a Business Intelligence System
  7. Differentiation by Direct response marketing
  8. E-Mail Marketing for High Tech Companies
  9. Online services Marketing
  10. White Papers Make a Great Marketing Collateral
  11. Build a Multilingual Web Site to cater to your Global Customers
  12. Are White Papers Just for Technical Marketers?
  13. Self Service Technologies - Enable customers to provide their own service
  14. Giving Customer Quotations over Internet
  15. Web Marketing with Google
  16. Marketing - Position before you communicate
  17. Unappointed Brand Ambassadors
  18. Search Engine Marketing
  19. Five Guidelines for staying on top of mind of your customer
  20. Why Build a Global Website
  21. Effective e-mail Marketing
  22. Branding on a tight budget
  23. Marketing - Developing Market Intelligence
  24. External Product Positioning - Need for Clarity
  25. Developing a Brand Position
  26. Selecting a specific brand position
  27. Define your Brand and determine its value
  28. Brand Management
  29. Market Research in services marketing
  30. Chosing a Value Position for a Brand
  31. Making the best use of Market Research
  32. Marketing - Build a distinct brand with Product Differentiation
  33. Web marketing using RSS
  34. Communicate a Rock-Solid Brand Identity
  35. Measuring Marketing Effectiveness
  36. Branding Mistakes - Having a "Me-Too" Brand Name
  37. Self Service Technologies and Customer Satisfaction
  38. Pareto Principle in Marketing
  39. Advantages of Niche Positioning
  40. The Art of Naming a Brand
  41. Importance of Search Engine Marketing


  1. Shorten your Sales Cycle through Web
  2. Sales - Its all about Money
  3. Hosting successful Seminars
  4. Sales - Knowledge is strength
  5. Marketing & Sales Funnel
  6. Sales - Know thy customer
  7. Selling enterprise Software
  8. Consultative Selling - Way to sell Enterprise Software
  9. Make a successful sales presentation Part-1
  10. Make a successful sales presentation. Part-II
  11. Customer Relationship Management & Sales

People Management

  1. Retaining People in Technical Jobs
  2. Retention of top managers
  3. Use Marketing to Hire and Retain Talent
  4. Should your company have a corporate Blog
  5. People Capability Maturity Model and Organizational Capability
  6. PCMM & Creating a learning culture
  7. Women's day: A brief history and Implication to firms
  8. Leadership & Diversity
  9. Why have International work experience?
  10. Branding to Attract Talent
  11. Principles of Change Management
  12. Employee-Employer Power Dynamics in Negotiations
  13. Promoting Organizational Change Through Communication
  14. Hiring in high-tech firm: Build Vs Buying Talent
  15. Global Manager


  1. Understanding Financial Value Creation
  2. Build a Multilingual Web Site to cater to your Global Customers
  3. Virtual Scale - Alliances for Leverage
  4. Cutting Edge R&D in India
  5. Management Speak - Vocabulary
  6. When it is better not to have a corporate Blog
  7. What is a Whole Product
  8. Books I recommend
  9. Economics of Structured ASICs and Standard Cell ASICs

Tuesday, May 30, 2006

Global Manager

Recently there was a The Indus Entrepreneurs (TIE) meet in Bangalore. The meeting was an opportunity to meet high tech entrepreneurs and would be entrepreneurs with venture capitalists. The meeting itself was not of great interest for me, but the companies represented (directly or indirectly through employees) at TiE is something worth writing about. Most of the companies were startups and yet global companies: Aarohi Communications, Sonoa Systems, EFI, Tavant, RelQ, Open-Silicon to name a few. These companies are called "Born Global" companies. ( Born Global companies are those companies which have operations in multiple companies within one/two years of their existence)

To be successful these companies need Global Managers. The top management and senior management in these companies need to have a special management skills. I have worked in one such company. I am writing this article on what it takes to be a global manager based on my experience and observations at my current firm and learning at B-School.

Successful managers need to have global vision
To be successful, global companies need to develop unique set of capabilities which allows them to:
  • Take advantage of resources available to it on worldwide basis - regardless of where these resources are located. These resources may be company owned or may belong to other independent firms. For example, my current company has the ability to use (third party) factories in Taiwan, Israel, China & Korea.

  • Enter any country it chooses and sell products in any country based on business opportunities. These companies are constantly in the lookout for new opportunities - and are not limited by geographic/national boundaries. My company, for example, has customers in USA, Canada, Israel, Portugal - and is/was negotiating with firms in Thailand, India, Korea, France, Ireland and Japan.

To succeed in a global market place, managers need to have a global vision and a complementing strategy which enables managers to develop a global vision which helps in breaking down existing geographic and competitive boundaries.

The manager’s global vision is shaped by several factors. One of the biggest driving factor is having a global mindset - i.e., ability to look at the global markets as a whole. This can be summarized by the slogan "Think Local Act Global".

Global managers work with the assumption that global markets are best served by adaptation to local conditions - and have local initiatives in different markets around the world. Diversity - ethnic, consumer, geographic, & economic diversity is looked as sources of opportunity. Global strategy focuses on optimal global sourcing, selling standard products and the ability to react globally to competitors’ moves.

External forces which drive global mindset

Company may have a global vision and a global strategy, but manager’s mindset is crafted by several forces internal to the company. In my opinion, there are four influences on the manager:

Leadership View of the world

One of the leading forces is the leadership view of the world. This is often driven by the CEO. A visionary leader can drive the global strategy - but he also shapes the managers’ view and his actions. Often times, top leaders in global companies have worked in many countries. Top leadership team in global companies often consists of members from a diverse set of countries. - See Leadership & Diversity
Top leadership in our firm consists of members from Pakistan, India, USA & Egypt.

Administrative Heritage

Administration style of the company can either be centralized or decentralized. In a global company, administration is often highly centralized. All decisions on use of tangible and intangible assets are centrally controlled. Local business units do not have control over local assets.

Organizational Structure

Manager’s mindset is also influenced by the organization structure. Global companies are structured around products & functional roles Global companies are not structured according regional offices.

Industry forces

No firm can work in isolation. It has to deal with vendors, suppliers, customers and competitors. The need to achieve economies of scale and scope have forced vendors and customers to globalize. For example, my company has to open an office in Taiwan so that we could deal with our vendors better.

Global Manager’s thought process

Managers have to retrain their thinking process to become global managers. This is a difficult task as their thoughts are often crafted by ‘traditional’ practices: Home country practices, ethnocentric views, preference to local/home country candidates/process/procedures etc. These ‘traditional’ thoughts has to be replaced by global thinking. A global manager’s thought process is characterized by:

  • Multicultural approach to reflect global operations
  • Shift of focus on "soft tools" - Vision, process and people to achieve objectives
  • Collaboration with a network of vendors, partners & customers
  • Recruitment from global talent pool - to get best set of people
  • Global transfer of human resources - global learning/training process
  • Creating a learning Organization
  • Focus on big picture - respond rapidly to global business environment changes.

Closing thoughts

In a global economy, high tech companies need to go successfully global. Such companies can then maximize the sales potential from existing customers and attract new customers without stepping into new product ranges, focus on innovation and offer improved and new products,
services and reshape the industry through a network of partnerships. For a strong global performance, the organization needs a group of global managers . Only then the global strategies can be implemented successful - thus making the company successful.

Born global companies which must develop a global mindset from scratch. The primary motivation in these companies are either ‘growth hungry’ or "deliver the best for the lowest price’. Depending on their primary motivation the companies develop a global strategy - which has to be successfully implemented by global managers.

As companies continue to expand globally they need managers who understand global business, operate effectively across cultural boundaries and balance strategic integration with adaptation to local markets. The opportunities the company pursues, and how it deals with the many challenges of a global business approach, depends critically on how good its managers are at interpreting and responding to the dynamic and diverse challenges facing the organization.

Also read:

Diversity & Leadership
Developing a global mindset
Value of International Experience
Why have International work experience?
Leadership for a Global Enterprise
Building a Company of Leaders
The Global Dimension of Project Management

Monday, May 22, 2006

Hiring in high-tech firm: Build Vs Buying Talent

High tech startups have a different set of hiring needs. During the in the initial years (1-2 yrs) the founders, who usually have substantial experience, recruit only experienced people. Hiring experienced people in the initial days of a startup is beneficial as the organization quickly gets people who have the skills it needs. As the organization matures, companies will develop the necessary skills in-house. These two options represent the Buy strategy & Build strategy respectively.

The choice between the two strategies is not clear - the company must answer the question: "Is a company better off developing and training specialized workers in-house (build) or hiring skilled workers from outside the company(buy)?"

This question becomes a bigger challenge in a latter stage startup or newly public (IPO) company, and at medium size firms. In a fast paced high tech industry, this problem becomes even more acute as the pace of technology changes is very rapid, companies cannot afford to lose time in training existing employees in new technology areas. But the company cannot hire the required talent from external world either as very few people possess such talent. The inability of the company to hire the required talent and the threat of a rapidly closing market window puts the company in a dire dilemma.

In this blog, I am documenting my observations and my opinion on acquiring the required talent.

When to "Buy" talent

In a fast paced industry where business environment is changing quicker than the time it takes to train & build the required talent - then companies are more likely to buy the required talent. In such industries - such as Semiconductors, software, Bio-sciences etc., it pays to buy the skills instead of developing them. This is more beneficial for senior roles such as system architects, senior design engineers, project managers etc.

For example, in graphic chip industry, companies such as NVIDIA, Intel, ATI & VIA - have hired talent from each other. In graphic chips market, new products are introduced every 12-18 months and companies do not have the time to groom their lead engineers. So they end up proaching from other companies.

Buy strategy has its advantages - ability to develop new products/technology quickly with fewer mistakes. But it also has a few serious shortcomings - Risk of not being able to find the right talent at the right time, risk of antagonizing existing employees that results in attrition, and increasing the operating costs. (Hiring external talent costs more money - cost of salary, cost of hiring, time & efforts for hiring)

When to "Build" talent

In a mature industry, where business changes are more predictable - companies find it valuable to build the required talent. For example in IT services firms, or Automobile firms, companies tend to hire college graduates and train them in various disciplines. Building talent in-house is often cheaper and it saves labor costs when compared to "buy" option. Therefore mature/established companies prefer to build talent whenever possible.

Companies which implement "build strategy" often hire a lot of fresh college graduates, have an extensive training program, make/encourage employees to have a career plan and have a mentor program for all employees. Intel, IBM, Cisco, Qualcomm, Dell, GM, Ford etc., are some of the strong advocates of "build strategy".

A mix of Buy & Build strategy

In a fast paced business environment, developing a new product requires a mix of engineers dominated with people who have new skills required for the new technology and also a group of engineers who are well experienced in the previous generation of technology. Such a group cannot be put in place by "Buy Talent" or "Build Talent" strategy alone. The problem becomes even more accute when if that group is often dominated by people who have the new skills and expertise in new technology.

This requires a mix of "buy-build talent" strategy. This strategy creates unique set of advantages by providing a lower cost and also helps in retaining existing talent. Existing employees are more likely to be paid lower than the new & experienced recruits and existing employees can be easily retained by offering training programs in new technologies and new skills. Retaining existing talent will involve providing in-house & external training, motivating them with the attraction of working on latest technologies and charting a career growth path.

To successfully implement this Buy-Build strategy, companies need to make two important decisions:

  • Whom ( or which positions) to hire from outside? And at what costs?

  • Who among the existing employees should be retained & trained in new technologies & skills?

Implementing this "Buy-Build" strategy involves building an effective HRM system based on:

  • Cost of hiring experienced & skilled talent
  • Time-to-market window & also modeling the cost of missed opportunity
  • Risk of not being able to hire the required talent in the open market.
  • Cost of training existing/current employees
  • Risk of losing existing employees
  • Underlying cost structure needed to make the project successful

The risk factors must be weighed and factored into the cost model. The optimal mix of buy-build talent is then dependent on a series of financial analysis - NPV or IRR analysis. The overall cost of talent has to be taken into consideration for project planning. Once the requisite mix of "buy-build" talent is identified, HRM policies must be targeted towards hiring the requisite talent from the market and retaining, training & motivating the existing talent (which is required for the project).

Closing Thoughts

With rapid changes in market conditions, companies are changing their HRM policies towards a mix of "buy-build" talent. Even established companies such as HP, IBM, Microsoft etc., now have a mixed talent pool at all levels of organization. Companies no longer have the option of "buy" or "build" alone. Only startups can sustain a pure "buy talent" strategy - but as the organization matures, HRM policies will have to be changed to accommodate a "buy-build talent" strategy.

Friday, May 19, 2006

Promoting Organizational Change Through Communication

Globalization, Technology changes, New competition, Changing customer demographics etc.. are forcing companies to change their business models, strategies and long term objectives. Organizational change is usually a tough process. In my previous blog, I had written about the human aspect of change management. In this article, I will be writing about the importance to leadership communication in the organizational transformation.

Change management has always been a complex task for the top management & its CEO. Some leaders have succeeded in transforming a company from the brink of disaster to a successful organization, while some have led the firm straight into disaster. In both cases, the CEO had a sound strategy, well laid out plans and a team of change leaders. Yet the results were vastly different. A key factor for successful change management has been the human factor in the change process. For employees in the company, Change is a promise of a better future.

Change initiatives that fail - often has one serious short coming:- Leadership communication between the CEO & employees. The leaders must promise a better future, and the promise must be pausible and create the perception that the promised future will actually materialize. This message must be clearly communicated to all employees in order to win employees trust, persuade then the believe that the changes will be beneficial and make them to implement the change. Thus leadership communication plays a very important role in promoting change.

Leadership communication styles

The first step to becoming a better change leader is to identify one’s dominant style and understand its strengths and weaknesses. Most leaders fit into one of three communication-style profiles:
  • Cartel Communicator: whose central concern is power: obtaining it, wielding it, maintaining it. Eg. Larry Elision, Azim Premji, George W. Bush, Scott Mc-Nealy
    Strengths: Unflinching determination, an excellent network among top-level political and economic leaders, bold decision making, and a long-term perspective.
    Weakness: Autocratic, unrealistic goals, disregard to feedback

  • The Aesthetic Communicator: whose high degree of communication savvy is driven by the need to create and project an attractive, likable, and credible image. Eg. John Chambers, Meg White, Steve Jobs, Bill Clinton.
    Strengths: Communicators possess a highly attuned sense of how to communicate with various stakeholders, a facility with systematic communication planning, a process view of change, a high degree of intuition, and lots of charisma.
    Weakness: May become blind to reality, get surrounded by yes-men.

  • The Videogame Communicator: whose high energy level, technological expertise, and intellectual restlessness make him or her a natural multimedia communicator and an inspirational, innovative leader. Eg. Larry Page, Bill Gates, Andy Grove
    Strengths: Truthful, team players, not worried about losing face, high self-confidence, entrepreneurial attitude.
    Weakness: Gets bored in absence of immediate challenge. Short span of attention.

Holistic Communicators

Executives who perform best in the complex, constantly shifting business environment are those who combine the strengths of all communication styles. I call them Holistic Communicators. Like Cartel Communicators, they are skilled at projecting determination, inspiring a focus on the long term, and developing and exploiting a powerful network. Like Aesthetic Communicators, Holistic Communicators possess an appreciation for the strategic importance of communication, an ability to communicate well with diverse stakeholders, and a strong analytic capacity for language. Like Videogame Communicators, they view mistakes as opportunities for growth and innovation, and their candor, empathy, and openness to new experiences and new ways of looking at and talking about issues make them skilled at inspiring followers.

Holistic Communicators often display the following traits:

Be the first to change! Be seen letting go of old habits and trying out new things. Make mistakes. Show vulnerability. Question yourself. Be true. Have the guts to share your ideas when they’re still unfinished.

Eliminate the promise-reality gap. Make a promise and then describe the steps toward achieving it. Follow up with immediate action. With every step announced and then completed, leader’s credibility will increase and people will follow, even through considerable hardship.

Tell it all—and take the tough questions, too. Many leaders try to hide company problems from their employees and the public, often exacerbating the problems. Secrecy breeds corruption, power abuse, and infighting. Honesty builds trust.

Be tough and empathetic at the same time. Be tough and clear in what needs to be done, but also be understanding when it comes to individual fates.

Be visible. Be there; for your followers to trust you, it’s not enough for them to see you on the cover of BusinessWeek. Go to the sales and shop floors, the cafeteria, the R&D labs.

Keep your eyes on the prize. For people to focus on the change, Leaders must focus on it. Don’t go for the seventh prestigious board membership. Stick with your mission, and your people will, too.

Don’t get hooked on short-term wins. Change projects are long-distance races. Sure, leaders need some early successes. But don’t lose sight of the long-term goal.

Use modern media. You want employees to use your company’s systems? Use them first. Be creative. Set up a chat room where anyone can ask you questions, and answer those questions personally.

Communication Mistakes to avoid

Some of the most common communication mistakes done by top leaders are:
  • Advocate teamwork .. But make lonely decisions, and you praise and reward individual contributions.
  • Demand Risk taking .. But play it safe, and you penalize mistakes.
  • Advocate diversity .. But are surrounded by yes-men
  • Speak about the need for long term change .. But reward quick fixes
  • Speak about synergies and sharing the best .. But place their yes-men in all key positions
  • Ask managers to focus on the task ahead .. But CEOs are never around.

Closing Thoughts

Change management is a complex process. To be successful, leaders must communicate effectively with all stake holders, employees. Successful change strategies must address the human aspects of change - while addressing the other issues.

Also See:
Principles of Change Management

Wednesday, May 17, 2006

Employee-Employer Power Dynamics in Negotiations

Negotiation has been defined as "an interpersonal decision-making process by which two or more people agree how to allocate scarce resources"

Every year, companies have to perform a mandatory ritual called as "employee appraisal". Often employee appraisal is a two or three way negotiations between employees, managers and top management. It is very common for employees to negotiate a higher salary and/or a promotion during the appraisal process. And at the end of this negotiation process - both parties can walk away happy or both can end up very unhappy depending on the process and outcome of the negotiations. The outcome of the negotiation is greatly dependent on the power the negotiator yields during the negotiations.

Source of Employer power

If employer holds greater power, then the employee raises/promotions may be seen as unfair. Often employers/managers are eager to be seen as fair negotiators - and work on creating a win-win negotiations. However during difficult times, there may be pressure to reduce salaries/benefits and at those times employer can yield great power over the employee.

Source of employee power

If employees are not satisfied, they can opt to leave the company and work somewhere else. This represents a serious threat to the operations of the company - as key employees cannot be replaced immediately. Thus employees too can yield a greater power over the employer.

Power dynamics

I have seen a lot of these employee-employer negotiations and having worked in marketing, I know a few things about negotiations. So in this article, I am writing about the power dynamics in employee-employer negotiations.

One factor that is widely acknowledged to affect negotiator performance is power. A negotiator’s power may be critical for the quality of his or her success, because it can determine the allocation of rewards in an agreement. The greater one’s power relative to the power of others, the more resources one should be able to claim.

In 1959, French and Raven described the types of power bases. They classified power into 5 types:

  1. Reward power : A’s power over B is a function of how much B can be rewarded and the extent to which B believes that A controls these rewards.

  2. Coercive power: A’s power over B is a function of how much B can be punished by B and the extent to which B believes that this punishment can be avoided if B complies with A’s wishes.

  3. Expert power A’s power over B is a function of B’s perception that A possesses some special knowledge or expertise.

  4. Legitimate power A’s power over B is a function of how much B believes that A has the lawful authority to influence B.

  5. Referent power A’s power over B is a function of how attracted B is to A and, thus, how much A can influence B’s feelings of personal acceptance, approval, and self-esteem.Note: A & B can be either the employee or the employer.

Those who wish to improve their negotiation power should realize that power may be influenced by a wide range of negotiators, and they are likely to be overwhelmed by the varied and often inconsistent lists of characteristics, properties, strategies, and descriptions that have been offered during the negotiation process. This results in a dynamic power equation. The dynamic negotiating power has four components:

  1. Potential power: To obtain the desired benefits from the negotiations

  2. Perceived power: Negotiators’ assessments of each party’s potential power

  3. Power Tactics: Behaviors designed to "use" or "change" the power relationship

  4. Realized Power: The extent to which negotiators have claimed benefits from the interaction

To gain an upper hand in the negotiation, the negotiator may use several influence tactics during the negotiation process. These influence tactics are:

  • Pressure The negotiator uses demands, threats, or intimidation to increase the target’s compliance.

  • Legitimation The negotiator attempts to legitimize a request for compliance or claim the right to request it by referencing existing policy or tradition.

  • Exchange The negotiator uses implicit or explicit promises to reciprocate if the target complies.

  • Coalition The negotiator obtains the aid of others to help persuade or pressure the target to comply.

  • Ingratiation The negotiator attempts to make a favorable impression and improve the target’s mood before requesting compliance.

  • Rational persuasion The negotiator uses logical arguments and factual information to support the viability of complying with the request.

  • Inspirational appeal The negotiator makes an emotional appeal for compliance by appealing to the target’s values and ideals.

  • Consultation The negotiator seeks the target’s participation in the decision making process and the implementation of the request.

  • Personal appeal The negotiator appeals to the target’s sense of loyalty or friendship before requesting compliance.

Closing Thoughts

The negotiations have to end at some point. The result of the negotiated agreement is ideal when both the parties walk away happy. Successful conclusion of a negotiations occurs when both the parties know their BATNA, their negotiating power, and to means to alter their negotiating power. This article is written with the intention to help readers know their types of negotiating power and ways they can alter their negotiating power in order to come to a successful negotiated agreement.

Principles of Change Management

I work for a startup which is growing by leaps and bounds. In the year 2006, the company is likely to report a revenue which is approximately 10x of the revenue in 2004. In 2007, the company is likely to go public through an IPO in NASDAQ. This kind of rapid growth is highly valued & even envied. But it also creates one of the biggest challenge - Managing Change. The company in 2006 is vastly different than the one in 2004 or 2005. Rapid growth induces rapid change within the organization. The company now has offices in three countries: USA, India, & Taiwan. In addition the company engages in a global operation with customers in US, Canada, Israel, Portugal and operations in China, India, USA, South Korea, Israel, Malaysia.

This startup represents a new breed of multinational firms - popularly called as born global companies. Rapid globalization presents one of the biggest challenge to any firm. Transforming a small startup into a global company requires the firm to be open for organizational change. Top managers and board of directors have the expertise on devising the best strategic and tactical plans. But to succeed in the organizational transformation, top management must also have an intimate understanding of the human aspect of change management.

Strategic and tactical plans mean nothing without successful execution. These plans have to be successfully executed by employees - Organizational transformation is achieved only through sustained collective action of all employees who are responsible for designing, executing and living in the changed environment.

Human side of change management

Organizational transformation can succeed only when the human aspects of change are considered. It must be noted in this regard that most employees are reluctant to change - humans by nature like stability and are averse to change. So it becomes imperative for the organization to align its organizational culture, corporate values, employees and employee motivation to encourage the desired change. And the company will reap rewards only when change occurs at the level of the individual employee.

Organizational transformation has four characteristics:

Scale: The change affects the entire organization
Magnitude: The change affects significant alternations to existing status quo.
Duration: Most of the changes to employee locations, designations, work flow, processes etc., lasts for several years.
Strategic importance: Some changes have greater strategic importance than others.
Leadership Involvement.

In a recent interview (at Wharton) with Vivek Paul, former CEO of Wipro, Mr. Paul said "We knew we couldn't develop from a small local leader to a large global leader if we didn't develop talent inside the company. We could never hire all the talent we needed," said Paul. So he and his team set out to discover "the DNA of building talent."

Most CEOs involved in organizational transformation say that they are concerned how the company workforce will react, how they can get their team to work together, and how they will be able to lead their people. They also worry about retaining their company’s unique values and sense of identity and about creating a culture of commitment and performance. Leadership that fail to plan for the human side of change often find themselves wondering why their best-laid plans have gone awry.

Research on organizational transformation done by leading universities and management consulting firms have identified a few guiding principles for change management. These guidelines are to be used as a systematic framework to manage and change the entire organization.
  1. Address the "people issues" systematically

    Any organizational transformation will create "people issues". When employees face an uncertainty, they will resist change. All organizational transformation will involve significant changes to job profiles, new skills and capability must be developed. Company leadership must address any employee apprehension early in the change process. This involves top leadership engaging the key stake holders and middle managers early in the planning process, in data collection & analysis. Key stake holders must be involved in planning, implementation of strategy and in all redesign of strategy. Planning and implementation strategy must be based on a realistic assessment of the organization’s readiness and capacity to change. In a well established firm, the history of the firm will indicate the employees readiness & flexibility to change.

    For example, firms such as GM, Chrysler, Ford are more adaptable to reorganization - than Renault or Peugeot. American Auto makers face the toughest competition from all over the world as a result, the entire organization has been transformed several times before and employees are open to changes.

  2. Change starts at the top

    Organizational transformation is stressful on employees at all levels. Employees will turn to CEO and top management team for strength, support and direction. The top leadership must embrace the new approaches first. This will challenge & motivate the rest of the organization. The leadership team must speak with one voice and display the desired behaviors. The CEO also needs to understand that, although leadership team public face may be one of unity, it too is composed of individuals who are going through stressful times and need to be supported. Any display of opposition to changes by the top management team must be done privately - only in front of the leadership team - without the rest of the organization knowing about it.

  3. Organization change efforts must involve all levels

    Changing the organization starts with defining the strategy and setting targets to design and implementation. As the change affect different levels of the organization, the change implementation team therefore must consist of members from all levels of the organization. Leaders at each level of the organization must be identified and trained - so that they are aligned to the company’s vision, equipped to execute their specific mission, and motivated to make change happen.

  4. Establish a need for change

    People are inherently rational and will question why the change is needed and to what extent. Employees need to know the whether the company is headed in the right direction, and whether they want to commit personally to making change happen. They will look to the leadership for answers. Making a formal case for the need to change and creating a written document which describes why the changes are needed, and the new direction the company needs to move - "A written Vision Statement" will answer many of the questions. By making a formal case for the need to change, the leadership team will be able to give consistent answers to employees.

    The formal document must confront reality and articulate a convincing need for change, demonstrate faith that the company has a viable future and the leadership to get there, and provide a road map to guide behavior and decision making. Leaders must then customize this message for various internal audiences, describing the pending change in terms that matter to the individuals.
  5. Create a sense of ownership among employees

    Leaders (from all levels of organization) incharge of organizational transformation must perform during the transformation. It demands ownership by leaders willing to accept responsibility for making change happen in all of the areas they influence or control. Ownership is often best created by involving people in identifying problems and crafting solutions. It is reinforced by incentives and rewards. These can be tangible (for example, financial compensation) or psychological (for example, camaraderie and a sense of shared destiny).

  6. Communicate repeatedly & consistently

    Once the need for change is established and the new direction is chalked out, the need, the plan and direction must be communicated repeatedly and consistently. Often change leaders make the mistake of believing that others understand the issues, feel the need to change, and see the new direction as clearly as they do. But in reality, most of the employees need to constant reinforcement of the messages through regular, timely advice that is both inspirational and practicable.

    Provide employees the right information at the right time and to solicit their input and feedback. Often this will require communication through multiple, redundant channels (training sessions, videotapes, newsletters, and meetings) throughout the transformation process.
  7. Assess cultural needs

    Top management must know the culture of the organization, the behavior at each level of the organization and its willingness to change before embarking on the transformation process. Thorough cultural diagnostics can assess organizational readiness to change, bring major problems to the surface, identify conflicts, and define factors that can recognize and influence sources of leadership and resistance. These diagnostics identify the core values, beliefs, behaviors, and perceptions that must be taken into account for successful change to occur. They serve as the common baseline for designing essential change elements, such as the new corporate vision, and building the infrastructure and programs needed to drive change.

  8. Address cultural needs

    Once the culture is understood, it should be addressed as thoroughly as any other area in a change program. Leaders should be explicit about the culture and underlying behaviors that will best support the new way of doing business, and find opportunities to model and reward those behaviors. This requires developing a baseline, defining an explicit end-state or desired culture, and devising detailed plans to make the transition.

    Company culture is an amalgam of shared history, explicit values and beliefs, and common attitudes and behaviors. Change programs can involve creating a culture (in new companies or those built through multiple acquisitions), combining cultures (in mergers or acquisitions of large companies), or reinforcing cultures (in, say, long established consumer goods or manufacturing companies). Understanding that all companies have a cultural center — the locus of thought, activity, influence, or personal identification — is often an effective way to jump-start culture change.

  9. Prepare for the unexpected

    No change program goes completely according to plan. People react in unexpected ways; areas of anticipated resistance fall away; and the external environment shifts. Effectively managing change requires continual reassessment of its impact and the organization’s willingness and ability to adopt the next wave of transformation. With real data from the field and supported by information and solid decision making processes, change leaders can then make the adjustments necessary to maintain momentum and drive results.

  10. Speak to the individual

    Change is both an institutional journey and a very personal one. People spend many hours each week at work; many think of their colleagues as a second family. Individuals (or teams of individuals) need to know how their work will change, what is expected of them during and after the change program, how they will be measured, and what success or failure will mean for them and those around them.

    Leaders should be as honest and explicit as possible. People will react to what they see and hear around them, and need to be involved in the change process. Highly visible rewards, such as promotion, recognition, and bonuses, should be provided as dramatic reinforcement for embracing change. Sanction or removal of people standing in the way of change will reinforce the institution’s Commitment.
Closing Thoughts

Leaders contemplating change know that people matter. It is all too tempting, however, to dwell
on the plans and processes, which don’t talk back and don’t respond emotionally, rather than face up to the more difficult and more critical human issues. But mastering the "soft" side of change management is the real key for successful organizational change.

Friday, May 12, 2006

Branding to Attracting Talent

Firms around the world are always on the lookout for hiring highly talented people. In India, companies are planning to hire aggressively - and are competing for talented people. Accenture plans to hire 20,000 in India for the year 2006, Infosys is planning to hire 25,000, TCS is preparing to hire 30,000, Microsoft wants to hire 7,000, and list goes on.

The key challenge for these firms is not in hiring in such quantity, but in hiring the right talent as they reach out to various universities, engineering colleges and other institutes. Hiring the right talent is not a task for HR alone. To get the right talent, marketing department also has to pitch in and the resulting task is called as "Branding to attract Talent"

In my earlier blogs, I had written about retaining talent - both managers and engineers. This article is more about attracting talent - How to make employees (present & prospective) think of your firm as their first choice to work at. Attracting talent via effective marketing plays a major role in retaining talent within the organization.

Marketing for Talent

Competition for talent will intensify. Companies will compete aggressively to hire valued candidates. As a result many companies are trying to market themselves to recruits, by applying branding techniques to the recruitment process. Companies have to market themselves to:

  • To retain their current employees (and to maintain/Improve morale & team cohesion)
  • To attract recent college graduates
  • To attract experienced talent from other firms

Marketers have to develop new brand attributes to attract talents. Marketers use sophisticated market analysis tools to identify competition for talent, identify what corporate attributes matter most to specific types of recruits and then develop a strategy to reach out to that talent.

Popular Brand Attributes

Several surveys have been done to identify various corporate attributes which will attract talent. I have made a condensed list of these popular (brand) attributes and are listed below in the order of their popularity.

  1. For People Like Me
  2. Fun place to work
  3. Innovative Company
  4. Training Opportunities
  5. Attractive work location
  6. Career growth opportunities
  7. High Salary or other monetary benefits
  8. Familiarity with tasks or Opportunity to do what I want to do
  9. Expect success at the task
  10. Work-life balance

The order of these attributes may vary a bit, but in an average most surveys have ranked them in the top-10. The top five attributes are universally applicable to both recent graduates and experienced employees, while the last five attributes are more specific to experienced employees.

Identifying the competition is an important starting point for a company trying to decide which attributes it should emphasize at what stage of the recruitment process. Traditional recruiting focuses on functional employment benefits, such as job security; opportunities for creativity and individual growth; and compensation. But an employer's intangible, emotional associations—"it's fun to work at this company," "we have a passionate and intelligent culture," "there is a strong team feeling here"—are just as important to recruits as similar associations with branded consumer goods are to potential buyers. So companies would do well to compare themselves with their peers on both functional and intangible dimensions.

Reaching out to Talent

Companies then formulate the appropriate marketing messages and carryout various tasks to get its branding message out to the public. But these branding activities should not collide or undermine the company's product/service marketing strategy. Marketers therefore must not apply conventional brand-building techniques. Instead, HR in collaboration with marketing must take the lead to craft specific messages that best distinguish a company in the eyes of its recruits can improve the cost-effectiveness of its recruiting pitch.

Some of the most common marketing strategies or messages used to attract talent are:

  • Internships, Joint Projects with universities
  • Seminars, events, workshops for students at universities
  • Scholarships, awards for excellent students
  • Campus presentations, Career fairs
  • Mentorship programs
  • Direct mail or permission based email campaign (job opportunities notification emails)
  • Direct response marketing
  • Referral program - Get candidates through employee referrals
  • Press releases for publicity for white papers and patent filings
  • Mass media advertisement campaigns - Print/TV/Internet

Closing Thoughts

As competition for talent heats up, the ability to attract and retain key talent becomes one of the tools for gaining competitive advantage. Corporate branding helps to attract the right kind of talent, but retaining talent is the lead indicator for the strength of the corporate brand. High rates of employee attrition tells that either the company attracted the wrong type of people or the corporate brand is not living upto its promise. Collaboration between HR & Marketing can lead to the development of a strategy to brand the company with the intention of attracting and retaining the highly valued human talent.

Also see:

  1. Use Marketing to Hire and Retain Talent
  2. Retention of top managers
  3. Retaining People in Technical Jobs
  4. Role of Leadership in Team Building
  5. International Staffing Strategy

Thursday, May 11, 2006

Why have International work experience?

Lately, I have heard several people whom I know fairly well came asking for career advise. Almost all of them had questions such as: Is it useful to have international experience, Is it beneficial for my career? How is it different to work in Singapore/Australia/New Zeland/USA/Europe?

These questions took me by surprise. Mainly because, Indians in general are eager to work abroad. When I was in college, there were no doubts in many of our minds - we wanted to go abroad. This time around, I see a little difference in young people’s minds. The rapid growth in Indian economy has created job opportunities which was unimaginable a decade ago. The economic growth has also enabled people to grow rapidly in their career. This is in sharp contrast to Europe, Japan & the US - whose economies have stagnated - leading to job cuts and virtually no career growth. As a result people are showing reluctance to go abroad.

My advice to all of them has been: YES!! Go abroad and get that valuable experience.

This advise often leads to the next question: "Why is international work experience valuable?" Fortunately, I don’t have to give a long answer for that, I just have to point them towards my earlier article on Value of International work experience.

Companies find employees with international work experience as a valuable asset. This is mainly because, The main value of International work experience is that working abroad gives a person an opportunity to learn new things. And it is this learning which makes the person valuable. Companies realize the value of international experience and therefore are eager to hire people with international experience.

Unique Skills acquired by working abroad

There are several unique skills one can acquire only by working abroad for an long period of time. These skills are:

  • Ability to work in an ambiguous environment
  • Better communication skills ( Better listening, talking & writing skills in multiple languages)
  • Risk taking Ability
  • Better decision making ability
  • Become a good/better team player
  • Overcome cultural bias - Ability to appreciate different ways to solve the same problem.

Many of the above skills cannot be listed in one’s resume. But these skills are highly valued. Often times, people who worked in foreign countries also learn the history of that place - this leads to improved decision making, as knowing the history of a place also teaches the cultural biases of the people in that land and their reaction to a particular stimulus. For example, a manager in a Bangalore based serving US customers can take better decision if he/she had worked in US before.

Closing Thoughts

My advice to all (irrespective of their nationality) is - When you have a chance to work abroad, grab it with both hands. Create such opportunities to work abroad - and then grab it. Work abroad for atleast for 3-5 years and then consider returning home. Remember that the value of your experience abroad is most useful for firms which are based in your home country.

Monday, May 01, 2006

Leadership & Diversity

Today in the era of globalization, corporate top management in most companies is characterized by a diverse muti-ethnic, multicultural teams. This heterogeneous team of individuals represents the changing facet of modern leadership. Even in my current firm, the top management team consists of people from USA, India, Pakistan, France, & Egypt: A heterogeneous team of individuals from a wider variety of backgrounds and perspectives.

Why a Heterogeneous Team?

While studying at University for my MBA, I had done a study on benefits of ethnic diversity - it was a team study done by a team of diverse individuals from India, Thailand, USA and Hong Kong. In this article, I am writing about the summary of benefits of multiethnic leadership and means to create a successful and diverse management team. This writing is largely based on my previous study and some of my observations.

Benefits of Diversity

It has been found that diversely educated and experienced top management teams give firms an edge, enhancing their ability to manage globalization and strengthening their financial performance. Heterogeneity in the leadership team: breadth of functional expertise, educational background, international experience, and industry experience helps rapidly changing industries, such as semiconductors, IT, Bio-technology, Oil & natural gas, and medical technology etc. Diversity in management team gives the firm a distinct competitive advantage.

On the negative side, it has been found that without the right mix of incentives and an appropriate leadership style, diversity can hinder, not help, performance. The problem is that heterogeneous teams are harder to motivate and manage. Heterogeneity decreases loyalty and increases the probability of conflict.

Given the high stakes of global competition, many firms are actively encouraging diversity among the work force and also at the top level management teams. A close knit like minded homogenous management teams are being replaced by a more heterogeneous group of diverse leaders. This type of transition is increasingly common in today’s globalizing world.

Steps to promote diversity

Most people think that it is easy to create a diverse heterogeneous management team - Just hire people from different countries/backgrounds. The reality is that creating a diverse team is hardly that simple. Yes, one can create a diverse, multiethnic team. But it may not perform. To improve performance and motivate such a team, we found that the following steps were necessary:

  • Promote an open culture: Bringing a diverse team together also brings a sense of insecurity among managers. It is quite natural for people not to trust others who do not share their beliefs/practices. This is a great obstacle for success. The only way to overcome this is to create an open culture. Create an environment where information should flow freely within the organization. Encourage an internal debate among the mangers - let this debate be a healthy one - where all opinions are welcome without criticizing the person.

  • Training is Important: Teamwork at the top level is extremely important. Individuals who make up the team may not be aware of the cultural nuances of other members in the team. It is therefore very important to provide training to the members to help them understand the cultural differences. Training can be in several forms: personal coaching by CEO, or formal training on cross-cultural work environment, or various team building activities.

  • Focus on goals. The diverse multiethnic team should concentrate on the goals. All the debates, arguments must be directed towards defining the goals for the organization prioritizing them. To achieve this, CEO should refrain from controlling the discussion, instead he/she should provide direction or guidance. This will keep the collective attention of the team focused on the topics of shared interest.

  • Get the pay equation right: In heterogeneous teams, cohesion — already in short supply — will be further threatened by significant differences in pay among members (including the CEO). A fair compensation structure, which includes incentives based on objective performance benchmarks aligned with the organization’s core strategy, is essential to maintaining harmony in a management team.
Closing Thoughts

Having a diverse leadership cannot guarantee success, but it improves the odds. Firms that adopt a diverse leadership teams are less likely to fail in a rapidly changing business environment. Global firms need diversity as they need to operate and succeed in many countries.