Infosys Recruitment Process
Infosys Recruitment Process
Infosys Recruitment Process
DE RECHERCHE
RESEARCH CENTER
- DR - 03010
Ashok Som
April 2003
Ashok Som ESSEC, Avenue Bernard Hirsch - B.P. 105, 95021 Cergy-Pontoise Cedex, France
Tel: + 33 (0)1 34 43 30 73 / 3309 (O) Fax: + 33 1 34 43 30 01 Mail: SOM@essec.fr-
HRM plays a critical role and constructive role. How important is the involvement of HRM in
strategy development and implementation under hyper-competitive environment. HRM occurs at all
levels of organizations and increasingly, outside organizations as organizations manage
relationships with external stakeholders. This article shows how innovative HRM practices are
being adopted by Indian firms to brace competition in the post liberalization scenario. The article
discusses the need for new skills, new policies and innovative HRM practices.
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Bracing Competition through Innovative HRM in Indian Firms:
Lessons for MNEs
India is one of the countries that has been identified as the 'Big Emerging Market'. With the
liberalization process, that started in 1991, and the subsequent phased deregulation of the Indian
economy India has slowly become the hub of several multi-national enterprises (MNEs) as its vast
untapped markets provide tremendous potential for growth. As more and more MNEs are trying to
seize the opportunities to tap into this vast market, the dynamics of doing business is fast changing.
The environment has become hyper-competitive and turbulent for Indian organisations, which
enforced protective environment before. Indian organisations have to brace themselves against
fierce competition and have to effectively equip themselves in order to survive and sustain.
Consequently, several Indian firms undertook significantly organisational changes during the late
1990s. Indian firms tried to adopt new strategies to cope with the ever changing and turbulent
environment. These Indian companies were able to successfully adapt to the dynamic corporate
scenario because of their foresightedness, technical expertise and marketing abilities[1]. However,
little has been said about the innovative human resource management (HRM) strategies adopted by
these firms which enabled them to efficiently survive, be competitive and grow profitably. On the
other hand competition is nothing new for MNEs. The need for aligning and adopting HRM
strategies is an old wine that has been repeatedly sold in new bottles [2]. But in the existing Indian
context, new possibilities have arisen while eliminating some historical ones. Many MNEs faced
uphill challenges to adapt themselves in the Indian context. This article (see “About the Research”)
deals with the various facets of HRM strategies that Indian firms are implementing and it shows
how essential it is to adopt the right HRM strategies in order to shape the future of the company.
This will be illustrated help of eleven Indian companies (see Table 1) that have adopted, aligned
and integrated their HRM strategies with their strategic initiatives. This will provide implications
for MNEs with regard to managing their specific HRM strategies to be effective in India.
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Insert Table 1 here
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About the Research
This article is based on our case research over a period of 5 years (1997-2002) in 11 large Indian
organisations in 9 industries. Each organisation, a leader in their own industry, has undergone
extensive restructuring process to brace themselves for the impending competition that has arisen
with the phased deregulation of the industries due to the liberalisation and privatisation policy
adapted by the Indian government way back in 1991. We interviewed numerous managers in each
company, analysed documents given to us by the companies and also obtained from public and
archival sources. We kept track of the 11 organisations to record any changes in their business and
HRM strategies during the last 5 years. Our research focus was to understand the role of HRM
strategies during an organisational redesign and performance-improvement process. The issue of
adoption of innovative HRM strategies to brace competition came out to one of the important
findings that Indian companies were resorting to improve their organisational performance.
The role of innovative HRM strategies can clearly be seen in the case of the Mehta Group, a leading
conglomerate that houses two cement companies – Sidhee Cement and Saurashtra Cement in
Western India. Sidhee has been declared as a sick unit and is under the Board of Industrial and
Financial Reconstruction (BIFR) while Saurashtra is a loss making firm. The Group employed a
turnaround strategy in order to stop both the companies from competing with another in the same
market when competition from the other players was increasing. A strategy to develop 'synergy'
between the two companies was devised in which strong emphasis was laid on innovative HRM
strategies. There was a complete redefinition of the organisation structure. Job roles and work
descriptions were revised, new positions were created and competency exercises for the employees
were effectuated. One of the main aims in the turnaround strategy was to reduce cost and to increase
efficiency. Instead of pursuing a retrenchment and recruitment philosophy, the group followed a
redeployment policy. It reorganised its employees into technical experts, industry experts and
market research personnel. Thus by enhancing human resource development the company was able
to record significant improvement in performances and was able to optimally utilise its resources.
Distinctive HRM strategies help to create unique competencies that differentiates products and
services and, in turn, drive competitiveness[3]. Senior managers remain aloof to the fact that HRM
extends to nearly all the activities of an organization and that it is not just restricted to one or few
departments. Well-organized HRM is a prerequisite for successful strategic changes. HRM plays a
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pivotal role in redefining new strategies so that they can suit the changing environment. At times
HRM not only compliments the new strategy, but also becomes the deciding and defining factor of
pursuing a particular strategy. To keep abreast with the dynamic business conditions, Indian firms
have revamped their HRM strategies and now incorporate part-time work, outsourcing and
temporary workers. This represents a drastic shift from the traditional personnel polices. However,
implementing such modern HRM strategies is not an easy task for senior management since
changing the mindset and motivating workers to agree to the change process is an uphill task by
itself.
An interesting example of this situation was at Mahindra and Mahindra's Ltd., the flagship company
of the Mahindra Group. The Mahindra and Mahindra (M&M) Limited (Tractor Division) was
suffering from manufacturing inefficiencies, low productivity, stretched production cycle and poor
output. The primary reason behind this inefficiency was the under productive and excess unionized
labour force. The work atmosphere was polluted with corrupt and injurious practices. Moreover, the
situation was further aggravated by the changes taking place in the external environment due to the
modifications in the business and government policies. The scene was set for a makeover. The
company had to adopt a new strategy in order to 'survive'. In 1995, the company introduced a
Business Process Reengineering (BPR), focussing on a total overhaul of the style in which the
company was organized. Instead of concentrating on improving or changing procedures, the scheme
focused on reformulating the way the company carried out its business. This initiated several
changes in the organization structure, which enabled the company to realign itself with the BPR
mechanism. Naturally, the introduction of BPR led to a rebellious cry from the labour force. Prior to
BPR, HR was never a part of the strategy making process in M&M Ltd. BPR adopted innovative
HR practices that used the “churning effect” to change the traditional mindset of the employees and
thus enforced concrete HR policies which were essential for the company's growth. Firstly, from a
multi-layered structure, the company adopted a flat structure, which got rid of the disparities
existing in the different levels. It brought people with a narrow band-width and encouraged team
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work. Regular meetings with workers were encouraged to build trust. The idea was to enhance the
company's belief that “HR cannot function in cabins”. Furthermore, the company repositioned
existing people in key positions and placed emphasis on training programs. It followed a simple
recruitment philosophy by refusing to hire highly qualified people who historically have always left
the organization to a competitor MNE. Instead, it believed in hiring professional consultants to take
care of advanced work practices and simultaneously it capitalized on its existing employee talent
through intensive retraining and redeployment strategies. Furthermore, the company began
outsourcing non-core manufacturing activities. After 5 years the results of BPR were spectacular as
it allowed the company to maintain steady profits, reduce working capital levels, and rationalize the
manufacturing processes. BPR proved to be an effective method to reengineer the firm's plants and
Liberalization was to enable India to improve its economic growth and to become internationally
competitive. Domestic firms were forced to adapt to new changes to face foreign competition.
Innovation became paramount as it was the only way to satisfy the rising consumer needs and
requirements. Companies began reorganizing their organization structure and their business model.
HRM became an essential element in these restructuring phase in order to enable companies to
improve the recruitment procedures, hire skilled workers and enhance their potential by devising
distinct career paths. Competition forced the HR department to use the resources in a more effective
way. This significantly contributed in creating a competitive advantage for the company.
A striking example of this situation is the case of Bharat Petroleum Corporation Limited. BPCL is a
public sector organization which is one of the leading companies in the Indian petroleum industry.
BPCL benefited from the fact that the petroleum segment was a monopolistic market enjoying
administered prices fixed by the government. In 2002, the industry was deregulated and this turn of
events represented a significant loss of market share for both multi-national oil companies and
Indian firms. The challenge faced by BPCL was to sustain its market share and to continue to make
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profits. The company decided to redesign the organization whereby HRM strategies were regarded
as important support services (along with Finance and Information Technology). Three kinds of
services – embedded support service, shared support service and corporate service – were
developed and each contributed to the successful turnaround of the company. BPCL used the HRM
services to cushion their main stream of business with respect to refining and retailing. Since BPCL
is a "public enterprise" it could not resort to downsizing the labor force. Instead, BPCL undertook a
strong retraining and redeployment philosophy so as to correctly use the excess manpower within
the organization. Consequently its sales force was increased by 50% without hiring any new
manpower. Competency mapping was introduced and new people were only hired for specialized
positions. The performance management system of the whole organization was revamped and was
made more customer oriented. Moreover, BPCL introduced a creative learning experience program
for its employees called the “Foundation of Learning Plan” that encouraged the development of the
employee's ability to work in high performing cross functional teams. The introduction of this
program lead to a boost in the competencies of the employees and their motivation to excel. The
example of BPCL illustrates how innovative HRM strategies can not only respond to traditional
personnel problems but that they can also improve and sustain superior performance.
Competency-based strategies are dependent on people and when people are regarded as key
strategic resource they must encompass through a social network. It is important for HRM to
identify new skills and manage the intertwined network of people through social networks within
and outside the organization. HRM policies differ depending on the rapport the employee shares
with the company and how this rapport are co-opted within the stakeholders of the organization.
Hiring of external consultants can play a key role in implementing the strategies decided upon by
the company as external consultants try to strengthen the networks within the organization by
providing tools to adopt innovation. This was the case with Tata Iron and Steel Company (TISCO),
a Tata flagship company, India's most cost effective steel plant. TISCO undertook a management
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restructuring program with the objective of transforming TISCO into a high performing and
growing organization. The key strategic drivers to achieve this goal was to focus on current growth,
enhance degree of profit and loss accountability, provide exciting career opportunities and build a
team of high-performing professionals. McKinsey was appointed to assist the company in achieving
these objective. Mckinsey started with an organizational restructuring program by creating a lean
and flat strategic business unit structure with enriched jobs, greater accountability, autonomy and
span of control. Accordingly unit teams were formed comprising of unit leaders and facilitators. At
the start, McKinsey provided with the facilitators who coordinated the unit's performance with the
unit leaders. Each team had to set targets and had to work towards achieving them. Performance
Ethic Program (PEP) was introduced to promote young dynamic people to higher positions thus
rejecting the policy of seniority based promotions and creating new social vibrant networks. The
PEP institutionalized and tailored the management development programs for officers. A new
Performance Management System was launched which included alignment of key result areas
(KRAs) with business strategy at all levels and clear career paths that would enable the company to
identify and reward the strong performers and provide them with growth opportunities. The
compensation and rewards were linked to performance and pegged to the market. This program
made the performance and reward system transparent and fair within the organization, boosting the
As firms debate on the role that HRM plays being a change agent, strategic partner, administrative
expert or employee champion it is evident that HR professionals must become key players in the
design, development and delivery of a company’s strategy [4]. Many a times, companies do not
realise the worth of the HR department. They often treat this function in the organisation as
secondary and at several occasions, redundant. Several companies get tempted to reduce their work
force and to do away with a HR department, on the premise of outsourcing non-essential functions.
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In today's environment where the human capital is precious and needs to be carefully nurtured, this
This is the case of Maruti Udyog Ltd, a pioneering company in the Indian automobile industry,
having a joint venture with Suzuki of Japan. Maruti had revolutionised the automobile and
components industry in India and had set high standards for its products and services. With the
deregulation of the automobile industry in India, Maruti, from being the undisputed leader,
controlling about 84% of the market till 1998, saw its market share reduce drastically with
increasing competition from local players like Telco, Hindustan Motors, Mahindra & Mahindra and
foreign players like Daweoo, PAL, Toyota, Ford, Mitsubishi, GM. The whole industry structure
changed in the last three years. To face intense competition, the company launched new models that
could be cater to different market segments. Maruti also shifted its business focus to customer care,
service and aggressive marketing. A change in leadership took place. Prior to this change, HRM
was considered as 'paper pusher' at Maruti. It played a negligible role, was given no targets and was
not accountable to the top management. HRM was at the bottom rung of the priority list and there
were times when there was no head of the HR Department. Managers considered that position as a
punishment posting. The new Managing Director decided to take up the challenges of HRM and
mapping and job rotations were undertaken. HRM was made responsible for the clarity and
transparency of the communication within the organisation and for the negotiation with the Union.
The role of the HR Department was reactivated and they were held accountable for defining job
profiles, simplifying procedures and processes and keeping employees happy by distributing regular
bonus. With the company's changed attitude towards HRM and the significant improvements
implemented by the HR department, Maruti has developed excellent teamwork and its
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Innovative HRM invokes new challenges, new skills, new programs and new technologies
With the arrival of competition in emerging markets, and the consequent changes brought about
within companies to brace this competition, the responsibilities and domain of the HRM need to
expand. The HR department has to develop new skills regarding recruitment and selection
procedures and craft innovative compensation and integration schemes for the employees. An
interesting example in this case is that Arvind Mills. Arvind Mills, which belongs to the Lalbhai
Group of companies. It is a family owned business producing textiles, ready to wear apparel, agro-
chemicals and dyestuff. In the late 1990's it was the third largest producer of denim in the world.
However, with the change in fashion from denim to gabardine and corduroy, the company was
adversely affected. The threat from powerlooms, the need to increase exports and the growing
demands of consumers lead the company to introduce a new strategy. HRM played a crucial role in
this business plan. The company created a Manpower Planning and Resource Group to take charge
of the selection and recruitment procedure, to organize the job structure and to define the task
description of the various employees. The group absorbed fresh talent from top management and
technical schools and conceived a compensation system that would match the industry standards.
Innovative new methods of recruiting were adopted such as the Selection Information System (an
online recruitment system) that provided facilities from generating call letters, fixing interviews to
evaluating the on-line interviews. This program was linked to the Compensation Information
System and the Training Information System. A Management and Organizational Development
Group was incorporated to look into the training of the employees. It provided three kinds of
training programs: functional, behavioral and global. Another innovative concept (in the Indian
context) developed at Arvind Mills was the Management by Objectives (MBO) which focused on
producing results desired by the management in keeping with the objectives and satisfaction of the
employees. Arvind Mills succeeded in finding a harmonious balance between the top management
and the industry workers. Udaan, a kite flying competition between the management team and the
operations team is a perfect example of building healthy relations between the two working bodies.
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In addition, programs such as Booboos (rock show) and Umang (forum) were introduced to create
The new concept of HRM calls for segmenting the work force according to different criteria like
age, educational background and business background. Policies need to be tailor made according to
the needs of each group, in order to optimally utilize the resources offered by each segment. In the
wake of liberalization, the State Bank of India, India's largest public sector bank decided to
undertake an intensive restructuring program. With the entry of foreign and private sector banks, it
needed to make itself more competitive. Hence it turned to business consultants, McKinsey for
suggestions and improvements. Accordingly the business was divided into 8 major functions, out of
which Personnel and HRM were among the five most important divisions. Furthermore, HR was
divided into four branches in order to serve the needs of the organization and the employees closely
and precisely. The four levels included, Corporate Office, Local Head Office, Zonal Branch and
Individual Branch. Although the Corporate Office handled most of the HR activities, each branch
was delegated specific responsibilities which made the management and decision making process in
the firm, simpler and more effective. The overall HRM strategy placed special attention on the
policies carved for middle managers as they are the ones who implement the strategies devised by
the top management. Care was taken to ensure that the strategies designed for the middle managers
Effective HRM and strong leadership can enable Indian companies to go global
Many Indian companies that perform well in domestic markets have not yet expanded to the
international arena. Several factors such as lack of confidence, lack of technical know how and
perhaps lack of resources inhibit leading Indian groups to expand their area of activities to other
parts of the world. HRM can play a crucial role in changing the attitude of the company and its
employees in order to facilitate entry and presence in the foreign markets. This is effectively
illustrated in the case of the Indian pharmaceutical giant Ranbaxy, which succeeded in expanding
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its business internationally due to the single-handed determination of its past CEO, Dr. Parvinder
Singh, and the manner in which he managed to change the mindset of his employees. Ranbaxy
found itself at the bottom of the pharmaceutical curve[5] inspite of being active in the export market
for 18 years. Foreign markets had more strict quality requirements in terms of raw materials,
packaging and physical properties of pharmaceutical substances. This implied heavy costs in
research and development facilities and careful organization of distribution and marketing activities.
Despite entering the foreign markets at the bottom rung of the value chain, Ranbaxy inched
upwards because the employees shared their CEO's belief and dream that they were in a position to
harness their resources and capabilities and to be successful in foreign markets. Together they
developed continual cross border learning programs to enrich their ways of working and
functioning. Furthermore, they invited managers from other parts of the world to be present on their
board. This step enabled them to catalyze their globalization process. Moreover, the CEO firmly
lead the company to integrate backwards, to enter new markets and to develop novel drugs. This
Limited. Infosys is one of the biggest Indian exporters of software and offers information
technology consulting and software services to Fortune 1000 companies. The determination and
effective management skills of the CEO, Narayana Murthy were the driving forces behind the
success of the company. His strong belief that Indian professionals have the capability to handle
complex projects lead the company to establish a name for itself in the foreign markets. He insisted
on implementing the best reward system in the industry to ensure that his employees were taken
care of. According to him, they represented the company's most powerful wealth. He encouraged
them to communicate with each other and to interact with the management through bulletin boards
and meetings. He set up a Leadership Institute in Mysore to prepare the Infosys' employees to face
the challenges of the dynamic market scenario and to groom them to be efficient leaders. The CEO's
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profound faith that human resource is the most valuable asset of the company certainly motivated
Innovative HRM practices can help the company to break away from traditional shackles
embeddedness of firms plays a far more important role in shaping HRM practices[6]. Most Indian
companies still function following age old practices and customs. Consequently their HR strategies
are also based on the traditional "industrial model" which involves several factors like seniority
based promotions, powerful union influence and strict job classifications. With the advent of a new
wave of thinking, several firms decided to break away from the conservative model and to adopt
new and dynamic methods that were more in synch with the changing industry standards. Clariant
(India) Ltd is one such company. With the demerger of Sandoz (I) Ltd, a new autonomous company
called Clariant was born. Clariant develops, manufactures and markets dyes, pigments, chemicals
for textiles, leather, plastic, paints and inks. With the reformation of Clariant, managers now had
Profitability through Performance and People (CLAP) was put into place to efficiently guide the
transition. The unique feature of this program was that managers who had handled multidivisional
responsibilities were able to remarkably unlearn the past and adapt to the new activities. The
program aspired to "change the mental process" by introducing several changes in the company's
way of functioning. The company moved from "Top Down Close Communication" to "Up Down
Open Communication", from "We and They" to "Do it Together", from "Control" to "Leading and
Managing". All these efforts enhanced communication among the workers. Task forces and cross-
functional teams increased employee participation and involvement. Furthermore, the company
introduced a "Goal Setting" program that increased motivation among the employees. The
Personnel Department of Sandoz, which was mostly involved with only administration activities,
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Innovative and proactive HRM can lead to superior performance
When a company is undergoing a restructuring phase, it is likely to uncover many problematic areas
that hinder its fine functioning. At such times, HRM can introduce certain drastic steps that would
enable the company to improve its efficiency. This was the situation encountered by the State Bank
of India, which prompted it to introduce the Voluntary Retirement Scheme or the 'Golden
Handshake' system. With the advent of new technologies like ATM's and Internet banking, that
radically changed the dynamics of banking, SBI found itself faced with the problem of redundant
work force. The vast work force that was once regarded as one of SBI's strongest assets became a
liability following the computerization of the bank. In order to protect its dealings and to remain
profitable, SBI realized that it would have to undertake rigorous cost cuttings and the VRS
implementation was part of this policy. The VRS deal proposed 60 days' salary for every year of
service or the salary to be drawn by the employee for the remaining period of service, whichever
was less. The introduction of this scheme lead to strong protests from the employees who claimed
that the bank had taken this hasty decision without undertaking correct manpower planning
measures. Workers unions and media strongly criticized SBI's VRS on the grounds that it was
arbitrary and discriminatory. At this crucial moment, SBI needed to implement the right HR
practices in order to retain its talented workers and to do away with the excess unskilled work force
With fight for knowledge workers increasing in a hyper competitive market, key to enhancement of
profitability depends on the recruitment and selection of knowledge workers in the organisation.
Until recently technology was considered as the prime area of focus for the company. It is now
stepping aside to make way for people. Thus, the HR executives have to extend their capabilities
and provide a greater value to the company. They must be able to comprehend the complicated
organisation structure and requirements of the company so that they can extract the maximum
benefits from the work force. They are responsible for the fine selection of the employees within the
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firm and for the effective deployment of the company's human capital. This explains the severe
recruitment process followed at Infosys Technologies Ltd. The rapid expansion of this software
export and information technology company called for an extension of its work force. The success
of Infosys depended on the wealth of its human capital and its ability to face the challenging
responsibilities disseminated by the company. Thus, Infosys carried out a rigorous interview
process in order to absorb candidates with the best capacity to learn. After minutely scanning the
curriculum vitae's of the potential candidates, Infosys selected a significantly small number for
testing. These tests included a set of puzzles and math algorithms in order to evaluate which
candidates have the greatest power to learn. The candidates that pass the test stage had to further
undergo an interview round which determined their job at Infosys. This strict and thorough
selection process ensured that the company had managed to attract the most skilled people available
A similar philosophy was followed at Wipro Corporations, the leading IT firm in India, which
believed in employing the best people and investing in them. Wipro recruited from the leading
Indian educational institutes, such as Indian Institutes of Technology (IIT) and Indian Institute of
Management (IIM) by being present in their placement programmes. For any new business it
entered, it always first gave a chance to the employees present. If internal talent was not found, the
company recruited the best from the competitive labour market. Each employee was meticulously
trained and groomed to be able to effectively respond to the business' requirements. Human capital
In the age intense competition, several Indian companies realise that the differentiator for superior
performance is people. Human capital and not financial capital should be the focus of new strategy.
Intelligent and skilled employees are a must for a company that wishes to climb the ladder of
success. As more and more companies are acknowledging the worth of human capital within an
organisation, the competition for the limited and precious human resource is getting fierce. The
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challenge is not just to be able to attract human capital and enhance its skills and competencies to
suit the company's needs; but to be able to retain it within the company. This is certainly not an easy
task given the increasing mobility and flexibility of the work force. As the battle to win and retain
talented and knowledgeable workforce intensifies, the HR department has to step in to play an
important role in the conception, formulation and execution of the company's strategy. This is
exactly how Azim Premji, CEO of Wipro Corporation managed to exploit the talent of his human
capital. Wipro Corporation is a typical family owned business that has diversified into several
unrelated businesses. One of the most profitable of them has been the Wipro Systems, a company
dedicated to computers, information technology and software developing. The biggest challenge
faced by this company was holding on to its skilled employees. With most MNEs wanting to enter
the IT sector in India and several global leaders like IBM, Microsoft, Oracle, Texas Instruments
setting up bases in India, Wipro became a playground for poaching talented workers. The strategy
followed by local new entrants into the business and MNE's was to recruit talented people from
well managed Indian companies, with Wipro being the prime target. Azim Premji realised this
problem and took all the necessary steps to retain his skilled work force. Human resource managers
considered employees as "talent investors"[7] and treated them as partners to be rewarded as other
investors are. Wipro was the first Indian company to launch the employee stock ownership
programme. The employees participate in the Wipro Equity Linked Reward Programme where they
Infosys also followed the policy of putting its people first. The management realised very soon that
its people were the key to take their company to international heights. Human capital was well
looked after at Infosys, which enabled the company to create a leading position for itself in the
Indian market and to gain respect in the international arena. The HRM believed that the employees
stayed with Infosys because the management was able to satisfy the three fold needs of the work
force: leaning value added, financial value added and emotional value added services. On the
learning aspect, Infosys provided its employees with an opportunity to accept responsibilities at an
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early stage in the career. On the financial side, Infosys provided stock options and low interest and
zero interest loans. On the emotional angle, the friendly, open and transparent atmosphere within
the company kept the employees involved with their job. As a consequence, Infosys developed an
ambience that would foster the overall growth and wellbeing of its employees. Infosys created the
“campus” which was a set of multi-floored buildings constructed on a sprawling five acre land that
provided banking facilities, ATM, volleyball and basketball courts, shower rooms, bus facilities and
Implications
The adoption of innovative HRM strategies in some of the Indian companies have improved
business performance and provided MNE’s two important lessons. First Indian corporate are late
movers[11] but are fast bracing to competitive pressures. MNEs must manage their organisation
efficiently and effectively to brace this renewed competitive challenge from Indian firms. Second,
Indian firms have now more resources to invest in developing innovative HRM strategies which
technology in their work process, boosting morale of employees and high retention of skilled
employees. MNE’s such as Castrol, Shell, Exxon (petroleum sector), Renault Tractor, Ford,
Express (banking sector), Levis, Pepe (textiles), IBM, Microsoft, HP-Compaq, Oracle (IT sector),
and Bayer, Roche (pharmaceutical) and not to mention of Coke, KFC, Macdonald, Procter &
Gamble, who have learned or are trying to learn the hard way of doing business in India.
Innovative HRM strategies build and develop trust within the organisation, increase morale of
employees and reinforce the role of well-being within the firm over time. For senior executives,
building trust and retaining key personnel is one of the major challenge during turbulent and hyper-
competitive environment. Though MNE’s have deep pockets, which is an important driver in the
labour market, but this study of eleven firms show that Indian firms are relentlessly trying to reduce
employee turnover by innovative HRM strategies. For those MNEs, who understands this challenge
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of doing business in India, the ultimate benefit is not to fall into the trap as their predecessors, but to
leap towards an integrated and innovative HRM strategy that can attract, develop, excite and retain
key talent.
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Table 1. Innovative HRM Practices Adopted By Indian Companies During The Post Liberalisation
Wipro IT • Sustaining the wealth of their • Introducing employee stock option schemes
Corporation human capital
Infosys IT • Accept the challenges of • Employee driven campus programs like
globalization "Infosys Toastmasters Club" to provide
support to the employees
• Construction of a Leadership Institute to foster
the qualities of leadership within the
employees
• Leadership through INSTEP program where
3-6 months internships are given to students
from across the globe
Ranbaxy Pharmaceutical • Climb up the curve of • PEP program
globalization • Backward integration, new drugs invention
TISCO Steel • Focus on current growth • Building cross functional teams of high-
• Enhance accountability performing professionals with clear career
• Cost reduction paths for individuals
• Revamped its Performance Management
System by aligning KRAs with strategy at all
levels
• Institutionalized tailored management
development program for officers
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REFERENCES
[1] For example see Bartlett, C.A and Ghoshal, S (2000). ‘Going Global: Lessons from Late Movers?’
Harvard Business Review, 70(5): 132 – 142 and Khanna, T and Palepu, K (1997). ‘Why Focused Strategies
May be Wrong for Emerging Markets.’ Harvard Business Review, July-August, pp 3-10.
[2] See Randall S. Schuller 1992 "Linking the People with the Strategic Needs of the Business".
Organizational Dynamics, 21(1):18-32; Randall S. Schuler and James W. Walker. 1990. Human
Resource Strategy: Focusing on Issues and Actions". Organizational Dynamics, 19(1):5-19;
Pfeffer, J. (1994). “Competitive advantage through people”. California Management Review (Winter): 9-28.
Ulrich, D. (1997). Human Resource Champions: The next agenda for adding value and delivering results.
Boston Mass : Harvard University School Press. Ulrich, D. (1998). “ A new mandate for Human Resources”.
Harvard Business Review, (Jan-Feb), p. 124-134. Christopher A. Bartlett and Sumantra Ghoshal 2002.
Building Competitive Advantage Through People. MIT Sloan Management Review 2002, 34-41.
[3] Peter Cappelli and Anne Crocker- Hefter. 1996. Distinctive Human Resources Are Firms’ Core
Competencies. Organizational Dynamics. 24(3):7-22
[4] See Ulrich, D. (1997). Human Resource Champions: The next agenda for adding value and delivering
results. Boston Mass : Harvard University School Press and Christopher A. Bartlett and Sumantra Ghoshal
2002. Building Competitive Advantage Through People. MIT Sloan Management Review 2002, 34-41.
[5] Bartlett, C.A and Ghoshal, S (2000). ‘Going Global: Lessons from Late Movers?’ Harvard Business
Review, 70(5): 132 – 142
[6] Gooderham, P.N., Nordhaug, O, and Ringdal, K. 1999. “Institutional and Rational Determinants of
Organizational Practices: Human Resource Management in European Firms”, Administrative Science
Quarterly, 44(3): 507-532
[7] Christopher A. Bartlett and Sumantra Ghoshal 2002. Building Competitive Advantage Through People.
MIT Sloan Management Review 2002, 34-41.
20
ESSEC
CE NTRE
DE RECHERCHE
RESEARCH.CENTER@ESSEC.FR
1997
97001 BESANCENOT D., VRANCEANU Radu
Reputation in a Model of Economy-wide Privatization.
97002 GURVIEZ P.
The Trust Concept in the Brand-consumers Relationship.
97003 POTULNY S.
L’utilitarisme cognitif de John Stuart Mill.
97010 NGUYEN. P
Bank Regulation by Capital Adequacy and Cash Reserves Requirements.
Page 1
97016 PERETTI Jean-Marie, HOURQUET P.G., ALIS D.
Hétérogénéité de la perception des déterminants de l’équité dans un contexte international.
97033 WARIN T.
Crédibilité des politiques monétaires en économie ouverte.
97034 FRANCOIS P.
Bond Evaluation with Default Risk: A Review of the Continuous Time Approach.
Page 2
97037 MNOOKIN R. (traduit par LEMPEREUR Alain)
Surmonter les obstacles dans la résolution des conflits.
1998
98012 BANDYOPADHYAU D. K.
A Multiple Criteria Decision Making Approach for Information System Project Section.
Page 3
98017 INDJEHAGOPIAN Jean-Pierre, LANTZ F., SIMON V.
Dynamique des prix sur le marché des fiouls domestiques en Europe.
Page 4
98039 BRIOLAT Dominique, AKOKA Jacky, COMYN-WATTIAU Isabelle
Electronic Commerce on the Internet in France. An Explanatory Survey.
1999
99001 CHOFFRAY Jean-Marie
Innovation et entreprenariat : De l’idée… au Spin-Off.
Page 5
99009 GROUT de BEAUFORT Viviane
Les OPA en Italie.
Page 6
99030 STOLOWY Nicole
How French Law Treats Fraudulent Bankruptcy.
2000
00001 CHAU Minh, LIM Terence
The Dynamic Response of Stock Prices Under Asymetric Information and Inventory Costs: Theory and
Evidence
Page 7
00017 BEAUFORT (de) V.
Les OPA au Danemark.
Page 8
2001
01001 DEMEESTERE René
Pour une vue pragmatique de la comptabilité.
Page 9
01027 TAPIERO Charles, VALOIS Pierre
The inverse Range Process in a Random Volatibility Random Walk
2002
Page 10
02014 EL OUARDIGHI Fouad, PASIN Frederico
ADVERTISING AND QUALITY DECISIONS OVER TIME.
Page 11