The last five years of the previous century have focussed our attention on knowledge-industries. In the first decade of the new millennium, India will witness a proliferation of several brainpower - and manpower-intensive industries. The way we manage people in this millenium must take into account the contours of these new industries and the expectations of a young, highly intelligent and ambitious workforce that will have an international choice of workplace. The IT industry has already opened our eyes to a new chapter in HR with the focus on retention and work environment, and to a new model of compensation through stock.
But it isn't the hi-tech sector alone that will force us to change the way we manage people in this millennium. The 21st century will witness a boom in retailing and the emergence of new industries - like leisure and entertainment - focused sharply on providing a service or an
experience rather than a product. These industries will change the skills and competencies that we demand of our workforce and bring new types of people into the workforce. And to manage these new types of people companies will have to look at different types of employment including "employment by the hour".
Today most companies think mainly of employees with a full time commitment to a single organisation. The organisation of the future will have an increasing number of part time employees as well as employees doing multiple jobs. As we become sharper in our definition of the skills we seek, it becomes possible to outsource and seek more expertise. Besides, with technology helping accelerate processes, service businesses will be able to offer jobs for a few hours at a time. Thus the organisation of the future could well have employees who are hired part-time, to work on a specific activity, and are not overly concerned with the organisation's vision, mission, or belief in teams.
With the need to be globally competitive on costs, services and quality, both companies and employees will want more flexibility - for instance, the option of coming to work for a few hours three days a week and not everyday. Or as entire activities get outsourced companies could hire
small teams of up to 10 people rather than individuals. The leader of the team will have to be an entrepreneur who takes on the responsibility of hiring employees, training them and delivering work of acceptable levels. Employing and compensating teams instead of individuals will need a
different paradigm.
But even today most companies think of work as all consuming for an employee and expect him to have the commitment to put in hours well in excess of his contracted terms. And they compensate him in various ways for this. In the past, this was achieved by being paternalistic employers and guaranteeing either lifelong employment or a life long commitment to meet his various financial requirements such as housing, education of his children, marriage of his daughter, or, even, taking care of the family after his death. Today, companies do this
through different models of compensation that include a mix of cash, perquisites and stock or variable pay, or by providing facilities such as child-care, fitness centres, or a mechanism to take care of chores like the payment of electricity and telephone bills.
But will the employee of the future seek as much "involvement" on the part of the employer? And will companies want to be as benevolent?
Computers and technology have already changed the definition of the workplace in a literal sense. Employees no longer need to be physically present in the office. In fact, they don't even have to belong to the same organisation. The new millennium will witness an increase in the number of these "bit" employees. It will also see the emergence of a few "system integrators" who coordinate employees and align their efforts to the mission of the company. Companies will become smaller and will essentially be a network of a number of small teams and individuals.
Will vision, mission, company ties, company bonding have any relevance in such a scenario? What will be the glue that will make these constituents interested in the whole picture? And do they need to be concerned at all?
I see a future where individuals may want to work on jobs requiring two different skills in two different places: for example, being a computer programmer and a music teacher. One may meet the employee's need for compensation and another, her need for self actualisation. Indian
employees will indeed have the freedom to make these choices in the new millennium because their compensation, adjusted for purchasing power parity , will, over a period of time, be comparable to global-benchmarks, for most high- skill and high intellect jobs.
The 21st century could also see more employees being entrepreneurs and employees at the same time. And getting their commitment in such a situation will be an even greater challenge. As the number of double-income households increase, the risk-taking ability of the average employee will increase. So will their ability to spend on their own training and learning. In a "partnership" structure, it will no longer be the company+s responsibility to train the employee; the latter needs to come to work fully prepared.
Compensation will become more sharply aligned to the risk reward potential of a job as it already is in other parts of the world. India has, to a large extent, been used as a global production house in the knowledge industries. At the dawn of the new millennium, it finds itself in the design phase and, in some cases, the customer/product support phase. In the future, the role of companies in these two phases and in the role of an "innovation" boutique will increase. Each of these phases and the jobs they entail call for different skills. They also have a different risk and reward potential.
Compensation will also be linked to the risk profile of the employee. Companies will have different type of contracts with different employees without considering their seniority or experience. Compensation will become more individual-oriented and will be a function of the time-commitment, results sought, and the risk involved. And the typical contract will not
exceed 2 or 3 years.
An employee+s productive life cycle in the 21st century will become much shorter. Consequently, employees will have to focus on maximising earnings in a shorter time-span like our sportsmen and filmstars! Employees will view their compensation in spans of 3 to 5 years linked to their performance and the life-cycle of the skills they possess. The employee's
compensation cycle, then, will be a series of -S- curves, that will reach higher or lower peaks (that is higher or lower earnings than the past) depending on her competency. Risk is implicit in the type of competency an employee possesses. The series of compensation curves of employees who
manage to keep ahead of the learning curve will have two or three high points. But in the case of those unable to do so, the compensation curve will be a sharply inverted -V-.
Will this century see us being different in our HR practices from the rest of the world?
In the past a paternalistic employer culture was both a matter of culture and a product of legal constraints. Clearly, with Indian companies becoming multinational and companies located in India servicing global customers, we can't live in isolation as we did in the past. By the middle of this century there may be nothing like Indian values or Asian values, maybe there will be pretty similar cultures round the world. But this may be the reality only for a small part of our large workforce. Answers to a few critical questions will determine the extent of impact of these changes
Will India continue to have a large number of educated unemployed? Will the life-style and leisure expectations of employees change? And will barriers to mobility across countries remain?
However, for the large majority who do not have the opportunity to be mobile, there may still remain a culture that will be common to all low cost nations: a culture with a focus on productivity and efficiency. The economic realities of being globally competitive will force attitudinal changes related to performance, quality orientation, and cost consciousness. In a
market driven economy there will be no scope for automatic wage-increases linked to inflation and no protection of jobs. Performance linked compensation and reward systems will be the norm. HR policies in the future are bound to reflect this reality. But some of our Indian ethos and
emotional bonding with the workplace and relationships will endure all this. The intrinsic-Indian need for an anchor that comes both from families and the belief that work is worship will hopefully remain.
Break all the new rules!