NEW DIRECTIONS IN HR

-B.V.RAGHUNANDAN, SVS COLLEGE, BANTWAL

State Level Conference,

SDM College of Management, Mangalore

March 24, 2009

FINANCIAL MELTDOWN: ISSUES OF HR Professional Management Vs Lifetime

Management Personal Growth Vs Institutional Growth Governance of Leadership Power Elevation of HR Redefinition of Bonus Revisiting Managerial Remuneration Executive Excess Blue Eyed Management Vs Normal

Management

EXECUTIVE EXCESSES

PROFESSIONAL MANAGEMENT VS LIFETIME MANAGEMENT Professionals were nomadic in search of

higher scales and better designation and authority

Low Institutional Loyalty Organisations bent to the personal traits of

the professional managers Performance was not evaluated Spending the time in searching for greener

pastures Developing cronyism Bleeds the corporation by executive bonus

and perks

PERSONAL GROWTH VS INSTITUTIONAL GROWTH Attrition Rate Lack of Stability in organisations Organisations not developing

personalities of their own Lack of Institutional Loyalty Yes Boss Culture Lack of Accountability for the

managerial performance Groupism and Board Room Politics HR Manager should strive to inculcate

institutional loyalty among HR

GOVERNANCE OF LEADERSHIP

Performance Appraisal

Remuneration linked to Benchmark of performance

Intensive and Frequent Training

Checks and Balances

Accountability

POWER ELEVATION OF HR Right Now at Operational Level Management Functional Level Management in other cases Current Trend is to move towards RPO Should be Elevated to Board Level

Management Governance of Leadership at every level

should be the responsibility of HR Manager Protection of Whistle Blower should also be

the responsibility of HR Manager HR Manager also should evaluate executive

performance and eligibility of Bonus & other Perks

REDEFINITION OF BONUS

Bonus is division of profit Should not be as a percentage of

remuneration Should be given only to the executives

who meet the benchmark of performance

Should also be linked to institutional loyalty based on certain years of service

Provision to deny any contractual remuneration where huge losses are the direct cause of executive failure or commission

REVISITING MANAGERIAL REMUNERATION

Reduction of Multilevel Scales of Pay Delink Pay and Reputation of

Management Institutes (“of the class of 1985 at Harvard Business School, 65 were prosecuted for securities violations” – Philip Delves Broughton in ‘What They Teach You at Harvard Business School’)

Revisit Executives Perquisites and the ability of the organisation to afford it in the worst economic scenario

EXECUTIVE EXCESS

No Absolute Power Subordinates should have a Grievance

Redressal Mechanism Ban all naked derivative transactions Ban all exotic derivative transactions Make them personally responsible for

speculative transactions HR should ensure an affordable life style

of the executives

BLUE EYED MANAGEMENT VS NORMAL MANAGEMENT Pay for Technical Competence and

Qualification HR mingling with people from every walk of

life are better managers than the isolated high society managers

Low Cost Managers are the secret of Chinese low cost business model

Incidence of wrong decisions due to abnormalcy must be identified through a signal system

Get out of the mindset to Westernise everything on the belief that everything Western is superior

THANK YOU