Axing without Ache

01 Oct 2013 Editorial Team

Productive development Relieving employees can be quite a task, cautions RAJU RAO. However, it is vital to make use of the 360° feedback strategy in a constructive manner for the organisation’s development.

Prozil is a multinational organisation that specialises in construction and infrastructure development. The company has a strong team of professionals; however, like any other organisation, it did face the usual problems of retention and escalating costs, among others. The profits of the company had been consistent in previous years. The multinational organisation is located in Nigeria and is owned by an Indian family; the majority of the company’s top management is Indian. The expatriates used to receive a salary about 10 to 12 times higher than the highest paid local employee, which led to rising costs.

New regulations
It must be noted that Africa is one of the poorest continents in the world and the locals are often exploited by multinational organisations. To safeguard the interest of local workers, the government introduced new policies for MNCs on a variety of parameters such as export, salary levels, registered returns, cap on amount of business, and even a control on the number of expatriates in the top management. There was also a fixed percentage determined for locals that had to be employed in order to do business in the country.

Problem areas
With these new boundaries and compliances, the implications for Prozil were huge. Major planning had to be done and drastic actions had to be carried out. Some of the pointers in the ‘action plan’ included the following:

1.   Many expatriates would be relieved of their jobs.
2.   Jobs had to be found for these outgoing individuals in other continents.
3.   The expatriates had to be replaced by local individuals.
4.   As the amount of business in the future would have a limit or cap on it, only a limited amount of business could be done.
5.   The amount that would be distributed as wages would increase for locals and be lowered for expatriates.
6.   In all probability, more locals would have to be hired.
7.   Additional thoughts and money would have to be invested for development of the locals.

The key solution
Our consulting firm in India decided to use 360° feedback as part of its intervention to solve these problems. The initiative was specifically aimed to improve delegation and empowerment in the expats’ top team. In essence, 360° feedback collects feedback on individuals from all the people they interact with in course of completing their work. The beauty of this exercise lies in its anonymity. Every expatriate who went through this exercise was scored. Employees who received high scores on most parameters, including delegation, were transferred to the company’s additional offices in other locations. This exercise provided a reward for good performance. However, employees with low delegation scores were given specific training courses on various aspects of empowering others.

On schedule
The agenda, however, was that every expatriate had to ensure delegation was carried out at his work function in a systematic manner. In effect, they were required to develop the subordinate locals to a level where the expats’ job or role could be done irrespective of their presence. This was akin to making themselves redundant. It was also required that they reach a position where they were confident about the ability of their subordinates to handle the work without guidance.

If the expats were able to do this in a matter of four to six months, they would be given the choice of shifting to a group company in London or elsewhere. This time frame was provided to the expats, after the 360° feedback, to make their local subordinates capable enough to handle their current position. This was a specific directive aimed to increasing the number of local employees in the organisation. The faster the expatriates achieved this, the sooner their placement elsewhere would be arranged. A repeat of the exercise would be done half a year later to find out how the scheme was working and how the locals were performing, as well as ways to improve performance.

All subordinates or locals with the potential to take over higher responsibilities were encouraged to take part in more challenging activities than their current role. ‘On the job’ coaching was conducted as a result of the findings of the 360° feedback. The method was used as a strategic tool on many fronts to enable the organisation to follow legal compliances set by the government without lowering overall organisational output.

The end result
Six months later, the scenario had changed dramatically. The total number of expats in the top team had dwindled. Quite a few had already been shifted and replaced by their second line of local leaders. The locals were at the helm of things at various top positions and were motivated and enthusiastic. Most significant, production did not slow down. Subsequently, more funds were released for employee development. Needless to say, all government policies were honoured and no laws violated.

The 360° feedback exercise was used on many fronts for many purposes, such as:

1.   Individual performance development
2.   Setting performance standards (as existing)
3.   Identifying future leaders (from locals), succession planning
4.   Grooming these locals for higher level responsibilities
5.   Delegation and working with an action plan
6.   Good handling of expats’ redundancy
7.   Enabling empowerment
8.   On-the-job training
9.   Planning and profiling
10.   Healthy competition, leading to ownership of locals

In conclusion
It is rare in the area of HR to have one tool or instrument that has the flexibility to cater to so many matters of concern. At Prozil, 360° feedback was used to motivate managers and employees alike; communicate the plan of the top teams to bring more local employees to the top; identify gaps and develop action plans; and explore potential star performers. This same concept can be applied to any multinational organisation across the globe.

About the author: Dr Raju T Rao, Senior Consultant, TV Rao Learning Systems Pvt Ltd, has wide consulting experience in assessment centres, 360° feedback and HRD audit.

Productive development Relieving employees can be quite a task, cautions RAJU RAO. However, it is vital to make use of the 360° feedback strategy in a constructive manner for the organisation’s development. Prozil is a multinational organisation that specialises in construction and infrastructure development. The company has a strong team of professionals; however, like any other organisation, it did face the usual problems of retention and escalating costs, among others. The profits of the company had been consistent in previous years. The multinational organisation is located in Nigeria and is owned by an Indian family; the majority of the company’s top management is Indian. The expatriates used to receive a salary about 10 to 12 times higher than the highest paid local employee, which led to rising costs. New regulations It must be noted that Africa is one of the poorest continents in the world and the locals are often exploited by multinational organisations. To safeguard the interest of local workers, the government introduced new policies for MNCs on a variety of parameters such as export, salary levels, registered returns, cap on amount of business, and even a control on the number of expatriates in the top management. There was also a fixed percentage determined for locals that had to be employed in order to do business in the country. Problem areas With these new boundaries and compliances, the implications for Prozil were huge. Major planning had to be done and drastic actions had to be carried out. Some of the pointers in the ‘action plan’ included the following: 1. Many expatriates would be relieved of their jobs. 2. Jobs had to be found for these outgoing individuals in other continents. 3. The expatriates had to be replaced by local individuals. 4. As the amount of business in the future would have a limit or cap on it, only a limited amount of business could be done. 5. The amount that would be distributed as wages would increase for locals and be lowered for expatriates. 6. In all probability, more locals would have to be hired. 7. Additional thoughts and money would have to be invested for development of the locals. The key solution Our consulting firm in India decided to use 360° feedback as part of its intervention to solve these problems. The initiative was specifically aimed to improve delegation and empowerment in the expats’ top team. In essence, 360° feedback collects feedback on individuals from all the people they interact with in course of completing their work. The beauty of this exercise lies in its anonymity. Every expatriate who went through this exercise was scored. Employees who received high scores on most parameters, including delegation, were transferred to the company’s additional offices in other locations. This exercise provided a reward for good performance. However, employees with low delegation scores were given specific training courses on various aspects of empowering others. On schedule The agenda, however, was that every expatriate had to ensure delegation was carried out at his work function in a systematic manner. In effect, they were required to develop the subordinate locals to a level where the expats’ job or role could be done irrespective of their presence. This was akin to making themselves redundant. It was also required that they reach a position where they were confident about the ability of their subordinates to handle the work without guidance. If the expats were able to do this in a matter of four to six months, they would be given the choice of shifting to a group company in London or elsewhere. This time frame was provided to the expats, after the 360° feedback, to make their local subordinates capable enough to handle their current position. This was a specific directive aimed to increasing the number of local employees in the organisation. The faster the expatriates achieved this, the sooner their placement elsewhere would be arranged. A repeat of the exercise would be done half a year later to find out how the scheme was working and how the locals were performing, as well as ways to improve performance. All subordinates or locals with the potential to take over higher responsibilities were encouraged to take part in more challenging activities than their current role. ‘On the job’ coaching was conducted as a result of the findings of the 360° feedback. The method was used as a strategic tool on many fronts to enable the organisation to follow legal compliances set by the government without lowering overall organisational output. The end result Six months later, the scenario had changed dramatically. The total number of expats in the top team had dwindled. Quite a few had already been shifted and replaced by their second line of local leaders. The locals were at the helm of things at various top positions and were motivated and enthusiastic. Most significant, production did not slow down. Subsequently, more funds were released for employee development. Needless to say, all government policies were honoured and no laws violated. The 360° feedback exercise was used on many fronts for many purposes, such as: 1. Individual performance development 2. Setting performance standards (as existing) 3. Identifying future leaders (from locals), succession planning 4. Grooming these locals for higher level responsibilities 5. Delegation and working with an action plan 6. Good handling of expats’ redundancy 7. Enabling empowerment 8. On-the-job training 9. Planning and profiling 10. Healthy competition, leading to ownership of locals In conclusion It is rare in the area of HR to have one tool or instrument that has the flexibility to cater to so many matters of concern. At Prozil, 360° feedback was used to motivate managers and employees alike; communicate the plan of the top teams to bring more local employees to the top; identify gaps and develop action plans; and explore potential star performers. This same concept can be applied to any multinational organisation across the globe. About the author: Dr Raju T Rao, Senior Consultant, TV Rao Learning Systems Pvt Ltd, has wide consulting experience in assessment centres, 360° feedback and HRD audit.