What is HR planning and why is it necessary for any corporate organization? Well, we could define it as a process that will help map out and anticipate the business strategies that will help make the best use of the organization’s human resources, taken at the total headcount of employees at all levels of the organization. Planning recruitment of employees, training them in the right manner and tapping their competence in the company’s benefit are some of the crucial uses of Human Resource Management and Planning (Manning 2007).
Two levels of HRM
Usually, the role of the human resource team of an organization works on two levels. The first one is hiring or sacking and second is human resource plan.
Hiring or sacking: The management participate in the decision of hiring or sacking employees from the organization keeping in mind important information like the recruitment costs, the moral consequences, any outplacement or redeployment opportunities for existing employees, the need for changing skills in the market and the availability of skilled staff in the organization, the quality of people available in the job market, time constraints for the company and management requirements as also the need for training and development schedules for the employees. They gather all this information by collating with different department heads and then decide on the HR policies (Hiatt 2008).
Human resource plan: With this information and keeping in mind the directions of the management, the HR team then chalks out a human resource plan which will be economically viable for the company and then works in tandem with the line managers to recruit new employees, arrange promotions, transfers and retirement options as well as ask them to resign, if needed. They decide on the number of staff needed in each department like sales and marketing, technical support systems, outsourcing associates etc. and ensure their proper distribution according to talent of the individual employee. Also, a proper HR plan can help forecast the employee turnover, which covers the process of input-output of employees due to various reasons. Also, a significant job of HRM planning is that they observe and encourage ‘soft’ skills in employees such as employee behaviour, commitment to the company and attitude to work, which helps in assessing performance and keeps the organization efficient (Roy 2008).
HR Policies of Infosys
Infosys Technologies is one of the leading software companies of India and has been topping the HR lists due to its employee friendly HR policies and its intimate yet efficient work culture. In 2006, Infosys became a US$ 2 billion company but it still retains the HR practices and work culture of a small company where every employee is important to the organization (Icmrindia 2006). The HR policies of Infosys are very strict with regard to recruitment as they hire only the best minds of the country, after scouring the campuses of the best technical and management colleges and universities from across the world, with one of the toughest selection processes in the industry. All selected candidates are then rigorously trained for 14 weeks as also yearly training programs later the Infosys Leadership Institute has been set up to train the future leaders of the organization, rather than mere employees (Hargreaves and Fink 2007).
Infosys HR policies
Infosys has a very innovative and humanitarian HR policy, being the first company of its kind to offer compensation to employees in the form of ESOP’s. The employee’s compensation would then be decided on the individual’s performance, the team’s performance and the company’s annual turnover. The following quotes will prove the difference of Infosys’s HR policies and planning. In 2006, the Chief Operating Officer of the company, Nandan Nilekani, stated, “We believe that people are our core assets and their empowerment is the key to scalability and longevity. Respect, dignity, fairness and inclusiveness are essential to get the best out of employees” (Icmrindia 2006). To understand this statement, a look at the Annual report of the company for the year 2005-2006 would well suffice. The report states, “It is the energy of Infoscions that make the environment at Infosys exciting and challenging … By identifying and fostering learnability in Infoscions, we are enabling an agile organization, at the forefront of change” (Icmrindia 2006).
Infosys was named the best company to work with, by Business Today magazine. To meet the demands of the HR survey of software companies internationally, IT companies need to have revenues of above US$250 million and has to employ 500 employees in the US, which Infosys has been doing successfully since 2005. The CEO, President and Managing Director of Infosys, Nandan Nilekani, stated that the HR practices of Infosys worked by motivating the employees to perform better on international levels (De Cieri 2008).
He states further that the company has focused on making its campus and technology infrastructure world-class by training and competency building among employees. Also, they have very sophisticated appraisal systems so that every good performance of an employee is rewarded with monetary incentives or promotions to strategic levels. If we look at the hiring graph of Infosys, since the early 2000’s, the company has increased its workforce from 10,738 in March, 2001 to 44,658 in March 2006 (Jones 2009). This clearly shows that the company believes that its key assets are people and thus it wanted to bring its employees at par technically with its global competitors. They have surfaced on the wave of globalization by splitting the huge company into independent units with 4000 employees each, so that the company would retain its intimate touch with its employees (Wilson 2007).
Discussion of process
The HR practices of Infosys have been influenced highly by the patriotic and liberal views of one of its founders, Mr. Narayana Murthy. His vision of simplicity brought the ‘human touch’ to the company and thus, the HR planning is not selfishly dominated by market or corporate interests in Infosys, unlike its global competitors. The employees have always been encouraged to innovate and share their learning experiences with their colleagues, building a sense of commitment and loyalty to the company and one’s colleagues (Icmrindia 2006).
The process of thinking differently begins with the recruitment process as Infosys takes acre to focus on individuals who have a high degree of ‘learnability’ suggesting that they have the ability to think logically, independently and can derive generic knowledge from their work experiences, while knowing how to apply the knowledge in new situations, making each person a potential leader and innovator. The company Human Resource personnel also place importance on the level of professional competence displayed by the individual and their academic excellence however, the employees are hired also on the basis of analytical abilities, leadership qualities, teamwork potential, proper communication and innovation skills as well as a logical and structured approach to solving problems (Zimmerman 2008).
Another major part of the HR planning of Infosys is its training process for freshers by introducing them to new processes and technologies as well as training them for project management and management development programs and leadership development programs. The company invests on its workforce, the best asset of the company and gets desired efficiency (King 2007). The company has recently spent around Rs. 200,000 (about $4500) every year on training new recruits at their Global Education Center in Mysore, inaugurated in 2005, which provides world class training facilities to about 4500 employees at a time and was considered the largest training centre in the world at the time (Cameron and Green 2007).
The competency levels of experienced employees are judged by the company by assessing individual performance, the organizational targets and priorities as well as feedback from clients. The Infosys Leadership Institute, set up in 2001, helps nurture future leaders of the company where executives are trained to handle changes of external and internal work environments (Mantouvalou 2008).
Performance appraisal at Infosys is done by evaluating the personal skills of the employee, the timelines and quality of work performed, customer and peer satisfaction, business potential and decision making skills. Analytical abilities and change management along with communication skills are also regarded. The managers at Infosys play the roles of mentors to the team members of any project and encourage innovation in work practices, so that every employee participates fully (Mantouvalou 2008).
The HR policies of Infosys have met the changes of the times, by recruiting not only engineering graduates but also science and mathematics graduates, so as to build an alternate talent pool, to combat the influx of multinational companies in 2006-07. Even in the recent times of recession, Infosys has not dismissed employees as mercilessly as other corporate institutions. They have handed a lot of pink slips to employees but made sure that they recruit an equal number of trainees, hiring around 25,000 new recruits in 2008-09 instead of 35,000 in 2007-08 (Zimmerman 2008).
Cameron, E., and Green, F., 2007. Making Sense of Human Management: A Complete Guide to the Models, Tools & Techniques. Kogan Page Publishers, NY.
De Cieri, H., 2008. Human Resource Management. McGraw Hill, NY.
Hargreaves, A., and Fink, D., 2007. Sustaining Leadership in HRM. Ebsco publishing, Sydney.
Hiatt, M., 2008. Human Resource Change Management: The People Side of Change. Prosci, London.
Icmrindia., 2006. Human Resource Management: Best Practices in Infosys Technologies. Web.
Jones, N., 2009. Competing after radical technological change: the significance of product line management strategy. Strategic Management Journal, 34 (13), pp. 1265-1287.
King, C., 2007. Changing Shape of Leadership. Ebsco publishing, Sydney.
Mantouvalou, V., 2008. Human Rights and Unfair Dismissal: Private Acts in Public Spaces. Modern Law Review, 71 (6), pp. 912-939.
Manning, C., 2007, Principals and Practices: Human Resources Today. National Book Trust, Auckland.
Roy, R., 2008. Dynamics of organizational HRM. System Dynamics Review, 24 (3), pp. 349-375.
Wilson, D., 2007, A Strategy of Change: Concepts and Controversies in the Management of Change. Learning LPS, NY.
Zimmerman, D., 2008. On the Path of Success: Facts and Fictions. IBL & Alliance Ltd, Auckland.