People: About 18 months ago, the human resource group at Avantha-earlier Thapar Group-got a new mandate; to change the group identity from ?ownership? to ?synergy across businesses with respect to management, operations and best practices?. This was no small order in a group entrenched in businesses as diverse as plantation to power equipment. The group has 20,000 people in six diverse businesses, with power transmission & distribution under Crompton Greaves (CG), pulp & paper under Ballarpur Industries Ltd (Bilt) leading the charge. The group?s other businesses are in areas like food processing, farm forestry, chemicals, energy and infrastructure.
But the group was transforming itself in 2007. It got its new name, Avantha, which combines the French word ?avance?, meaning ?to advance?, and ?tha? from Thapar, late that year. ?When Avantha was a $3-billion group in 2007 we set a goal of reaching the $10-billion revenue mark by 2013?, says Lav Kumar Shelat, group vice-president, human resources. So HR had its task out.
Considering the 2013 plan, 60 C-level executives of the group were put on an evaluation plan by an independent leadership consultancy on competencies such as ?customer focus? and ?market knowledge.? The evaluation plan, HR felt, was a requisite to reach the $10-billion goal. The exercise was done over nine months and each of the chosen leaders was given an individual development plan in private by the consultancy and the group HR head, with immediate supervisors given low visibility in the feedback. This helped the senior management not to feel threatened by the process since the development was aligned to organisational goals.
Shared forums, facilitated by HR, encourage executives from different businesses to interact with each other towards an integrated goal, unlike in earlier days when the management of one business would not even know its counterparts in other businesses. This part, says Shelat, ?Building a strong leadership will help perpetuate the company culture across to the organisation.?
In hindsight, was Avantha preparing itself for the downturn? For, the current downturn is prodding companies across the spectrum to become more integrated. Fewer silos can exist, be it critical functions such as product development and supply chain or service groups or cost functions like finance and HR.
People, operations and product are some of the key elements forward thinking companies are working to develop, even those with multiple businesses such as Avantha.
Operations: In operations, companies are looking at more efficiency internally and externally. Last September, LG Electronics, the Indian arm of South Korean consumer durables major, decided to brace itself for a five-year challenge and created a plan to raise its operational self-ranking of 7.5 out of 10 to a higher scale. It identified 20 areas for increasing operational efficiency internally, such as training, recruitment, induction, shift timings, plant teamwork and the like. It also set rolling new initiatives in GSM mobile phones, liquid crystal display monitors and commercial air-conditioners. A renewed focus on non-traditional markets was also part of the game. Already, LG Electronics draws just a quarter of its domestic revenues from top 15 metros; the rest comes from Tier-B and C cities and rural India.
The result was that life still remained good at the company known for its tagline Life?s Good. Last October, soon after the global economy began to tumble, LG was celebrating. The Diwali month brought it the highest revenue of Rs 1,450 crore, its single largest in a month. The company doled out 12.9% salary increments in 2009, a shade lower than 13.8% paid in 2008.
Yasho Verma, director HR & MS at LG, comments: ?Our employees are susceptible to the outside environment just as those in any other consumer goods company. Since the slowdown they are more conscious of the external environment and are working harder.?
Product: At Symphony Services, a privately held company with $200 million revenue, HR very much speaks the business talk of the company. Product and people functions are closely integrated at Symphony. The company, which has its global headquarters in California and local headquarters in Bangalore, does engineering research & development, product development, quality assurance, testing for bugs for clients such as Oracle CRM and Autodesk. For mid-sized and smaller customers, Symphony handles the complete whiteboard to market cycle within product development.
Symphony perceives innovation as the key to organisational success, and employees are encouraged to demonstrate innovative engineering when working on client?s products. This holds true at a more macro-level as well. C Mahalingam, executive vice-president and chief people officer, says, ?The software services industry is adapting and course correcting as we go along in 2009. For instance, within pricing, the SAAS (software as a service) framework, which started two years ago and works on a pay based on usage models like electricity and water, is now picking up momentum and replacing the prevalent licensing model that is more expensive to clients.?
Also, in pursuance of adjustment to the new environment, the company is examining the prospect of ?monetising innovation? by setting up an ?innovation protocol? with clients. For instance, the company in the last three months filed close to 20 patents for clients pro bono and plans to going forward look at a revenue share model with clients.
Symphony encourages employees to pursue ?planned orchestrated innovation? and has identified 25 to 30 ?innovation mentors? wherein they facilitate through an ?innovation portal? presentation of the employees? ideas to the client and should clients adopt the idea employees are rewarded depending on the scale with T-shirts or much bigger rewards. A good example of people, operations and products linked into one whole.
malvika.chandan@expressindia.com
