Organization performance has been the focus of scholars since long. From Fortune 500 list of companies in 1992, only 120 appear in the list of Fortune 500 for the year 2007. That is, over 76% of the Fortune 500 companies disappeared from the list in 15 years, Accenture study (2007).
In India, one of the most readily available organized data on performance of the business organizations is published by Economic Times, in terms of ranking of Top 500 companies in India. This is published every year so that the comparison from year to year is possible. For the purpose of this paper, 10 years’ data from the fiscal year 1995 to fiscal year 2005 was taken. These 10 years have been the years of liberalization and growth in Indian economy, marked with unprecedented and sweeping changes. This has thrown open opportunities in all sectors of economy.
Organizations have had wider choices to embrace new technology, launch new products, enter new markets and become global companies. These opportunities have been available to all companies in India. Some of them made full use of these opportunities and grew very rapidly. On the other hand, a large number of companies have not been able to cope with this new liberalized competitive environment. Economic Times ranking of 500 top companies in India shows that 309 out of top 500, i.e. 62% of the companies listed in the fiscal year 1995 are no longer in the Economic Times listing of top 500 companies for the fiscal year 2005.
Further, 101 out of total 500 companies i.e. 20% of the companies have declined in their ranking from fiscal year 1995 to fiscal year 2005. Only 90 companies, which are 18% of the Top 500 companies, have improved their ranking over the last 10 years. Both Fortune 500 and Economic Times 500 indicate a trend that large number of organizations are not able to sustain their success over a time period of 10 to 15 years.
Why does this happen? Does leadership play any role in influencing the company’s performance?
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It’s a pleasure to be part of this wonderful HR fraternity led by National HRD Network. Since it’s my very first interaction with the group, I thought I would start off by sharing a bit about myself and a few of my reflections on some other issues. I see this blog as a new two-way communication platform on the internet and I hope that this forum would help us share ideas and suggestions. I request your wholehearted participation to ensure that we can communicate meaningfully.
About Me: I currently head the HR function at Bharti Airtel Ltd. I started my career with Eicher Tractors in 1984 as Unit Personnel Officer and thereafter have held various roles in Hindustan Lever Ltd and Unilever, spanning the diverse areas of HR and Organization development. After spending 20 years with Levers, I joined Airtel. I have over 22 years of professional experience in enterprise level roles, change management, performance management, people alignment and driving the HR transformation agenda to deliver strategic value for the business.
I start off our journey of sharing ideas by seeking your thoughts on what do we need to do as HR professionals to make a lasting impact on our business performance? With increasing competition, the key differentiators for any organization are its people & capabilities. Therefore, our focus needs to be on ensuring that the best people continue to be with us and perceive our companies as ‘employers of choice’.. Hence, this is the time when we have to seriously re-evaluate the HR role and bring in cultural changes.
Which brings us to the next question-Are there any areas that we could work on to build a culture conducive to delivering high performance? One of the areas that has been recognized as a catalyst to this is ensuring a healthy work life balance for our employees. This topic wasn’t as important in the past as it is today because, in the past, people often were able to attend primarily to one major role in their life (eg, working, housework, etc.), rather than to several (eg, to a career, being a parent, pursuing hobbies, etc), such as today.
The importance of ensuring a good work life balance and adjusting patterns to help combine our work with other aspects of life can not be overstated. According to a study done by Gallup Inc, 76% of employees in a managerial positions want more time with their families & friends; 50% claim to be too exhausted mentally and physically to do anything but work and sleep; 30% said that their life is out of control and 20% said that they are too stressed to enjoy life at all.
As HR professionals, we understand that work has evolved from a matter of necessity/survival to also a source of personal satisfaction. Also, to me work life balance is not just about the amount of time you spend working vs. not-working or office vs. home. It is about Achievement and Enjoyment for each one of us. These two characteristics are the different side of the same coin. To lead a happy life, we need both these key ingredients in our lives.
Hence, how can we as leaders assist our employees to strike this balance- In order to be driven to give their all to their organizations?
With increased access to improved technology, options such as telecommuting have been instrumental in enabling increased work life balance for organizations. Organizations of today are also opening up to providing increased flexibility (in terms of work schedules) to employees- Which also helps them balance their lives. However, the success of any such initiatives lies in the willingness of the people managers to drive it as a personal agenda. Translating this intellectual awareness into day-to-day practice involves enabling your teams to prioritize their work and striking a balance. This would not only make them many times more productive, but would also provide them the time that they need to lead a ‘whole’ life.
Once again, this is a two way platform and should help us share our ideas and thoughts, so do contribute openly.
Motivating employees at work is an issue confronting academicians, researchers and practicing managers all over the world. Human Resource managers are
• Reevaluating the relevance of traditional motivation theories developed by Maslow and Herzberg, which focus higher set of needs such as self-actualization, in the present day cultural context
• Suggesting suitable changes and developing an alternate theories to understand the intrinsic process of employee motivation
The Fear Greed Theory of Motivation
There are interesting implications for managers and decision makers as they revisit the process of motivation. Thomas Patten, argues that there are just two basic motivators, i.e. greed and fear. Fear-greed motivation theory, as postulated by him, has economic self-interest as its core and is more fitting to what is happening today. In support of his argument, he cites the exchange theory in sociology, public-choice theory of political science and emerging socio-biology, all being focused on self-interest. The recent fall of financial giants, seem to support this contention.
How relevant is Maslow Today?
Greed seems to be emerging as a potent addition in the context of loss of jobs due to economic downturn, rising labour costs and potential reduction of financial services industry coupled with already shrinking aerospace and weapon markets, all causing widespread fear among working class. Well-paid jobs seem to be increasingly perceived as means for providing a secured and gratifying existence. A secured existence reduces fear. The more is fear reduced, the greater is one’s feeling of security.
The proposition is thought provoking in the current context -
• What truly motivates employees- is it greed or self-actualization?
• Are the motivational theories of Maslow and Herzberg based on self-actualization enough to understand the work motivation process today?
• If the answer to the previous question is no, is there an alternate framework to help practicing managers understand behavior of employees and the motivation process
Show me the money: Is it all that it takes?
It is only in the past decade that the importance of rewards – money, in particular, has been recognized. Organizational Behavior Expert, Lawler seems to support this, “A great deal of evidence exists to suggest that pay was important to employees and that it could motivate them, yet it has been systematically ignored or distorted”.
The generalization in relating greed seems to be justified in workers exhibiting consistent behaviour pattern (asking for more benefits). Work has indeed moved from being a “noble cause” that a man could be intrinsically motivated to engage himself in, to a “commodity” which is accomplished in lieu of money through extrinsic motivation. And as work assume the nature of a commodity, motivation to deliver more than expected has dropped and most enterprises today grapple with quality issues.
Schemes intended to motivate employees by linking compensation to performance and productivity are not alien to us. The assumption is that people perform better if they are provided with higher incentives. Research studies, conducted in various work settings, however support an opposing view. According to Alfie Kohn, “As for productivity, at least two dozen studies over the last three decades have conclusively shown that people who expect to receive a reward for completing a task or for doing that task successfully simply do not perform as well as those who expect no reward at all”.
In an increasingly consumeristic world, where there is demand for higher deemed comfort levels,
• Do most employees find their lower needs are inadequately satisfied?
• Has this led to the temporary disappearance of man’s higher needs, and consequently his desire to reach out towards them?
Even as we look at modifying traditional motivational theories of Maslow and Herzberg, the theory of fear-greed motivation could do with more conceptual rigor and empirical studies. Most importantly, in an emerging economy like India, which is at the crossroads of change, there is growing importance of money as the prime motivator for work. And therefore, the theory of fear-greed motivation could be of interest.
By Dr. Pallab Bandyopadhyay, Head of HR- Asia Pacific, Perot Systems
The most invisible but impactful element of the organisation is culture–and arguably one that helps sustainability as well as consistent and superior performance. It’s not just difficult to define but also to explain in a meaningful way, and at the end of the day, is an aggregation of many things. Culture is underlying and what is visible or observable are symptoms, and maybe some behaviours, or how things happen in the organisation. It is then the job of leadership to make meaning out of these visible symptoms/signs and take action to reinforce or correct certain things. However, changing culture is often difficult and unsuccessfully attempted. The difficulty often lies in changing things (processes, leadership, ways of working, people bahaviours and rewarding mechanisms). This is particularly so if the organisation has been successful in the past. Here are a few primary causes (and there can be many more), which seem to be relevant in this context. These are more from a leadership and people perspective and do not illustrate the challenges from a financial, process or system perspective.
It’s easier to talk about problems than do something about them. Most people can fairly accurately talk about symptoms, and some even get to the root cause of issues. Collectively or individually, it’s most likely that the people in the organisation often are well aware of the problem, or at least part of the problem. It is however quite amazing that nothing happens as a consequence. This could be due to many reasons–the voice is not heard, symptoms ignored and /or the analysis of the root cause is faulty. However, it appears that most of the time organisations and leaders do not know “how” to deal with the problem. So they know the “what” but not the path to get there. It’s also feasible that the “how” is linked to difficult choices and a different way of doing things, so it does not automatically happen. And many leaders may believe that by talking about the problem enough, it will somehow go away. Unless there is differentiated action to address real issues, this is unlikely to happen.
Most People/Leaders see themselves as being outside the problem. It’s often quite enlightening to see people talk about challenges in their organisation. It is as if they are analysts or consultants. They refuse to believe that their own actions, behaviours and contribution is also part of the success and culture of the organisation. It is as if they are not part of the organisational dance but standing aside watching other people dance. It’s good to step back once in a while and take a detached view. It is also imperative to accept that each employee (and particularly senior leaders) leave a mark by how they behave and do things on the fabric of the organisation. This defines culture more often than not, and unless there is personal responsibility to see and do thing differently, the collective change at an organisational level will not happen.
The wrong behaviour is being rewarded and not reprimanded/corrected. This is perhaps the most contentious area. Leaders often give confusing signals to people down the line. There are either not enough motivators for change, and not enough communication around the consequences of changing or not changing are. The rewards (or reprimands) often have nothing to do with behaviours the organisation is trying to drive. There are overt and covert reward mechanisms in organisations–e.g,who gets more face time with the leader in a particular group. While leaders may deal with overt and apparent reward mechanisms (pay, promotions, appraisal ratings etc), they are often negligent of the more subtle recognition mechanisms and what message it is passing to the organisation at large. It is quite difficult to get even the stated reward mechanisms right while implementing–bringing objectivity and fairness. On top of that if there are too many covert signals as to what is ‘really’ valued –or not–it confuses the organisation and creates mistrust and lack of behavioural direction.
The subtle signals are ignored. Organisations and culture don’t change by themselves, at least in a planned way. There are of course examples of crises which force change. While implementing change however, signs of support or resistance can be often ignored, By not acknowledging support, this is likely to go away and enthusiasm fade. By not dealing with conflict and resistance in a timely and direct manner, it can grow, and even become a roadblock. The ability to pick the signs, and more importantly act on them is critical. Change managers and leaders are so taken up by their own vision and what they want to drive that other perspectives can be missed sometimes. Also, differentiating between the more apparent (vocal) signs vis the ones which are less apparent may be important to direct action. The trick therefore is to not just pick the right signals and all of them, but also interpret meaningfully, assess the impact and act.