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Case Analysis: Infosys (A): Strategic Human Resource Management Abstract Infosys Technologies Limited is one of Indias largest information technology services with a remarkable global presence. It was founded in Pune, India in 1981 by N. R. Narayana Murthy and six of his colleagues. Since its inception it has shown a tremendous growth rate in all spheres. It now operates nine development centers in India and has over 39 offices worldwide and it has grown from 410 employees to over 72000 employees worldwide.
It toppled from its ranking on Best Employer List both in 2001 and 2002 in 2003. The HR Department was taxed with putting Infosys right back on the lists of Best Performing companies and best employer by 2007. [ 1 ] Some of the problems faced by Infosys are studied here. General Environment -Technological With growth and increasing reputation, Infosys also had to face increased expectations form customers, faster turnarounds and execution of orders. These demands were accentuated by economic turnaround of 2001 - 2002.
When the market fell and companies had to work harder to compete. It has to be in the forefront to be on the cutting edge. Processes and even training is getting more and more technology driven... "Productivity improvement comes from converting synchronous transactions to asynchronous transactions, " explains Murthy. His example: switching from phone calls (synchronous) to e-mail (asynchronous). [ 2 ] Employees get more and more detached from management. -Social-Cultural India has a large educated middle class. But the docile, loyal mentality cultivated by the British has given to more aggressive, consumer society which knows its worth in the global market. Loyalty has been replaced by money values.
Employees switch companies without a turn of conscience for better pay and perks. The high stress and early burnout in the IT industry makes them quit jobs sooner when they have made enough money to switch to different kinds of lifestyle. Traditionally Indians had a stoic way of looking at life and accepting fate, now they are impatient with inconveniences and discontent faster. -Economic Infosys has gone from competing with companies like Wipro to competing globally with IbM, Accenture. Its strength is its brilliant low paid labor. So keeping labor costs low is one of the keys of competitively. -Legal/Political As one of the pioneers in strategic offshore outsourcing of software services, Infosys has to keep lobbying for the right of Indians to compete in America. The US Govt severely reduced the number of visas in from 195, 000 in 1998 to 65, 000 in 2004. [ 1 ] This made it hard for them to send people onsite.
Onsite experience also motivates employees a lot but this compensation wasnt open any more. Task Environment -Competitors China is fast catching up globally in the IT industry. The Japanese, the East Asians are learning English and are not far behind. So Indians and Infosys have to keep two steps ahead.
Many more companies are stepping in and multinationals with their better profile and compensation packages pick the best talents from companies like Infosys. Infosys set up an office in china as a potential market for growth. Each had a different culture and it became a challenge to change styles of management. -Labor Market Infosys depends on its special treasure chest filled with thousands of fresh Indian engineers. They are now calling on local labor too.
As in Brno, Czech Republic. [ 3 ] And China. Chinese students are now being trained in the special training centre in Mysore, South India. Few expenses have been spared in the effort to impress the several hundred fresherS. But the trainees believe they are underpaid although they agree that the training is invaluable. (Salaries start at about $ 5, 000 a year. ) Internal Environment -Culture The traditional feel of Infosys was a small company culture plus a collegial feel where processes and policies were flexible and customized to individual needs. But this got lost as the company grew tremendously. Infosys tries hard with Dj nights, quizzes, games, recreational and entertainment facilities, healthcare and a host of other benefits to keeps its people satisfied.
Employee social services group involve them with community work, street children or old age homes. [ 1 ]The HR department is constantly given targets to meet in terms of employee satisfaction and lowering attrition rates. So they come up with new schemes constantly to please people, which again leads to mistrust. -Employees These are India's chosen. Securing a position at Infosys is more competitive than gaining admission to Harvard. Last year the company had more than 1. 3 million applicants for full-time positions and hired only 1 percent of them. [ 2 ] These people are the cream of Indian campuses and get bored fast. They dont like being unused or idle. Now know their value so they keep moving. -Management Infosys is a company with Core values.
C-LIFE standing for Customer Delight, Leadership by example, Integrity and transparency, Fairness, Pursuit of excellence. Theyve always been pioneers. But with rapid growth Infosys has its own problems. It prefers to be overstaffed to keep processes smooth and running 24 x 7 so some people are always idle or on the bench. Middle mangers are not in touch with lower cadres. And cannot understand their frustrations in doing repetitive, non creative work and sometimes no work at all.
In 1999 realizing they were a small large sized company, Infosys decided to restructure and implement a series of changes in the way people were measured, compensated, rewarded and promoted. Promotion is not only linked to seniority and performance as in the past; but also now to the needs of the organisation. Promotion is based on the performance off the individual and whether the new post was needed. This was to ensure that there was no fat in the organisation All this led to dissatisfaction and it fell of the best employer list in 2003. Problems and Possible solutions: Job dissatisfaction: The discontent stems from being uncreative. They are the best brains in India.
Highly trained and elated when they are hired; they are proud to be an infoyscion. They revel in the restaurants, housing, entertainment and all that the HR dept had elaborately laid out for them. They are trained rigorously in soft skills and technicalities. But the glamour fades fast. On the job, they are the lowest cadre.
They dont make decisions. Programming is repetitive if any. It is usually maintenance work. They are part of a large team and do repetitive monotonous work. There is no room for the technical ingenuity that has been nurtured.
Solution: Keep moving employees around projects. While the tendency is to retain an employee in an area that he has gained expertise in, moving him around keeps him learning, creative and alert. Promotion Another grouse among employees that upward growth is tough and slow. Promotion is not only linked to seniority and performance as in the past; but also now to the needs of the organisation. In an effort to cut fat, promotion to a post is also evaluated in terms of whether the post is needed at all.
This again has led to mistrust that the company was putting itself before the employee. Solution: Communication channels must be kept clear so that the thoughts of the management are clearly filtered down to the lowest levels in all clarity. Compensation. Although pay packages are good and on par with the rest of Indian companies, increase in pay is linked to a series of factors, imposing stress on the individual. Variable pay was introduced across the company. 10 - 15 % of pay was based on company performance, unit performance and individual performance. [ 1 ] It created better pay for an employee whose performance was better. So it helped in retaining better talent.
But employees were skeptical seeing it as a way to downscale compensation. A system of broad banding was introduced when each job had an equity value attached to it. depending on value addition and contribution to business. This was the tipping point in employee dissatisfaction. Rapid changes, miscommunication and rumors led to discontent and lack of trust. Alternate Solutions: Study of TI which was ranked 167 by Fortune 500 and 83 in the list of best companies to work for by its employees. [ 4 ] Forums for better communication! [ 5 ] Snap polls on various issues using our intranet.
These could range from being satisfied with the cafeteria to gauging employee interest in several initiatives. A quarterly site-wide town hall meeting where we communicate matters of site-wide significance to employees. Conduct comprehensive surveys periodically that give us deeper insights into employees' feelings. Conduct regular surveys of the level of engagement of employees within their respective workgroups. This may give hard facts on specific issues within the respective groups, which may impact the extent to which employees feel engaged or disengaged at work. Relationship Reviews.
In this, teams get together typically once a quarter, and (much like design or business reviews) review the nature and quality of relationships within the team members. Taking care of the employees aspirations Dual career paths for employees: TI has firmly established separate career paths for those who are inclined to grow as managers of technological organizations and for those who believe in growing as architects of the new technology. Support everybody: Support not only top performers in their growth but also performance enhancement plans for employees needing it. Self-directed work teams: One approach that has been successful in many companies including TI involves organizing production workers into self-directed work teams. Teams of between 5 - 15 workers take responsibility for an integrated, custom driven, production process. And gradually expand their capabilities to include administrative and support roles.
As the team matures, it slowly becomes more autonomous until it functions with minimal supervision. Conclusion: Controlled attrition is not a matter of chance. It requires consistency of management practices and sustained effort. Infosys with its remarkable growth and vision could surely right itself and attain Best employer status consistently. BIBLIOGRAPHY: [ 1 ] Thomas. J.
Delong, (October 16, 2006), Infosys (A): Strategic Human Resource Management, Harvard Business School. [ 2 ] Julie Schlosser, (March 17, 2006: 10: 40 AM EST), FORTUNE writer-reporter Money. cnn. com/ 2006 / 03 / 15 /magazines / fortune /infosys fortune 032006 / [ 3 ] web [ 4 ] FORTUNE 500 2006 Annual ranking of Best Companies to Work for money. cnn. com / magazines /fortune / fortune 500 /employe rs [ 5 ] MALINI SURYANARAYANAN (Saturday, Aug 23, 2003), In conversation with V. Kartikeyan, Director, Human Resources, Texas Instruments (India) Pvt.
Ltd. , HRD Counseling, The Hindu- Opportunites, web [ 6 ] Richard D. Reason May 6, 1994, Self directed Work Teams at TI submitted to MIT Sloan school of Management. [ 7 ] en. wikipedia. org / wiki /InfosysTechnologiesLimited - 63 k - 23 May 2007
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Research essay sample on Case Analysis Infosys A Strategic Human Resource Management
