11.3 Managing people

11.3 Managing people

GSW- related knowledge work is made possible only by attracting , retaining and motivating capable knowledge workers. This key challenge of managing people is shaped by the size and context of the relationship and has implications for implementing structural innovations to manage attrition and motivate staff.

Sierra s India centre faced the constant problem of attrition that had magnified consequences compared to a large MNC like GlobTel. The impact of losing a single developer in a 20-person centre is magnified as compared to a similar loss in a 500-person centre . This loss is felt more if large amounts of money have been invested on training, on rotating the staff to onshore customer sites to help develop customer-specific knowledge and close personal working relationships with onshore colleagues. Recruitment and retention of staff will always be a problem for small companies such as Sierra who compete for the best staff with large foreign MNCs offering a structured career path , glamour and the potential for foreign travel and working in more attractive conditions of new technologies and with higher remuneration. Reputation and firm size thus become major factors in attracting the best programmers. Besides these factors, managers need to develop a close understanding of local contextual issues that influence the attraction, motivation and retention of development staff. These complex issues expose companies to risks that are not immediately perceptible or easy to manage. Although the ˜ streets of Bangalore may be filled with programmers , it is still not easy to attract and retain them, as Sierra found out to their disadvantage . Even large Indian software houses find it difficult to manage the ˜ out-of-control nature of global environmental trends such as rapid changes in advanced technological platforms. For example, in 1998 skills requirements were dominated by the North American demand for developers with experience in Powerbuilder. Such work was perceived by many Indian developers as furthering their careers and leading to future foreign travel to the USA. Interviews with Eron developers emphasized their reluctance to work on what they perceived as outdated platforms (such as Ingres), as it would impede their career prospects and opportunities for travel. Similarly, GlobTel in making its ˜right-angle turn , decided to give Indian firms primarily the task of maintaining their legacy systems. This decision was expected to potentially cause large-scale attrition of developers working on GlobTel projects. In contrast, some Indian engineers expressed a preference for working in Japan as it provided them with the potential to work with new and cutting-edge technologies being tested in the market.

High attrition rates characterize the Indian software industry, averaging about 30 per cent at the peak in 1998 “2000. Although this situation became less intense in 2001 owing to the US recession , it is volatile and subject to change. Most of the turnover tends to be junior developers (1 “2 years experience) who leave primarily to North America for purposes of higher studies or taking up employment. Very rarely is the movement horizontally to other firms in India. Some Indian suppliers have taken drastic measures to curtail the problem by opening software centres in emerging locations such as China and Vietnam where staff attrition is not yet so much of a problem ( Computer Weekly , 2nd August 2001). The top IT firms in Vietnam claim to be able to keep project teams together for months at a time.

In order to develop effective structures for recruitment, motivation and retention, large Indian software outsourcing companies offer structured career paths. Mastek, a top 20 Indian software house, achieved structured accreditation for the Capability Maturity Model (CMM) and People Capability Maturity Model (PCMM). This is an indicator of well-structured and defined career paths at the highest level (5) (at the time of writing, Mastek was the only company in the world to achieve PCMM Level 5 status). Mastek, like many other Indian software houses, provide share options, interest-free loans and training opportunities as incentives to retain key staff. Trends towards localization by opening centres in the UK, the USA, Japan, Germany and Belgium have meant that Mastek can offer employees overseas experience and mitigate the potential for individuals leaving because of limited opportunities for foreign travel. GlobTel offered Indian staff the chance to come to North America for a year after having served for 3 years, and the possibility for employment into GlobTel after 5 years of experience.

Despite all these efforts Indian software houses accept staff attrition as inevitable and attempt to build networks with external agencies to maintain a steady staff intake. Instead of trying to control attrition, as GlobTel did, MCI tended to focus more on managing the implications of attrition more effectively by introducing systems of ˜shadowing and ˜buffering where more developers would be deployed working on the project than were actually billed. Even though this raised salary costs, this was acceptable in comparison to the costs involved in recruiting and training new employees. Many companies try to inculcate a strong sense of local identity to help motivate staff. Mastek, for example, has a reading group where employees come together and read a range of texts for discussion; guest academic speakers are invited to give talks on topics such as globalization and Indian identity. In one such lecture, the academic speaker contextualized India s current position in the global software industry in relation to its historical strengths and leadership in mathematics and sciences. Mastek staff also participate in weekly reading groups on topics as diverse as the writings of J. Krishnamurthy, an influential Indian philosopher. Software houses also try to develop the tradition of ˜annual getaways . Mastek s ˜run time event brings together clients and staff in an environment away from the corporate office to help develop solidarity. ComSoft consciously tries to create a ˜family environment that emphasizes ˜Indian values to provide conditions in which the staff feel that they can do work on a par with the best in the world while being based in India.

Standardization of motivation structures can be problematic . Sierra tried to import motivation structures directly from the UK, including reward and recognition systems. A small firm, with limited experience of operating in India, it had problems understanding what would motivate the Indian team. Mitra, the British manager in India, once told us in exasperation that his American textbooks on motivation didn t seem to work in India. Indian staff were not interested in things which motivated UK developers, such as ˜fast things to keep you amused ( cars , video games , hi-fi, etc.), informality and after- work drinking. Mitra had believed that the impact of Western movies, television and travel would have led to similarities in motivation structures in India, the USA and the UK. However, adopting a view of Bangalore as a ˜place as opposed to a ˜space reveals the complex social, organizational and technical networks within which actors are situated. Motivating and retaining staff requires sensitivity to these networks and social structures involving infrastructure, networks of competition from other firms, family responsibilities, attitudes to hierarchy, religion and spirituality. In one of our research reports to Sierra management we stressed that Mitra would benefit from involving himself in the local networks such as the Software Association of Bangalore, visiting colleges and giving talks at local universities. Mitra had some success with this strategy and managed to recruit a small number of graduates from the prestigious IITs, who in turn helped to attract their friends and classmates. However, heavy investments of time and money are required for implementing such a strategy. Small companies such as Sierra typically do not have such resources and Mitra, despite being the centre manager, had also to engage personally in the recruitment effort.

Knowledge workers have a strong sense of identity grounded in structures of their society, the ability to do high-tech work in a global environment and the academic community to which they belong. Schemes for recruitment, motivation and retention need to keep in view these complex processes of identity and their construction. ComSoft management tried consciously to develop this identity by creating a culture and image that would nurture the growth of such an identity. This identity is continuously being redefined in the turbulent global environment however: GlobTel tried to impose their own identity and frame of reference in the Indian operations through the ˜global manager initiative, paradoxically implemented by an Indian manager.

Training has clear implications for the GSA relationship, attrition and motivation. GlobTel s training efforts were aimed at producing the universal ˜GlobTel Manager who would encapsulate common frameworks of cultural and language, approaches to management and technical understanding. The standard ˜template of management was reflected in Sierra s attempts to create a ˜little bit of England in India . These standardization efforts aimed to manage attrition by means of expatriates ˜filling gaps and a standard ˜template being available for preparing new staff. However, management training is often done in a superficial manner, confined to such aspects of interpreting body language and speech “ for example, an Indian making a sideways head movement means ˜yes and not ˜no . Such simplistic training helps to fuel stereotypes and prevents a deeper and more contextualized understanding of social behaviour. There are exceptions, of course, and we found one Indian company trying to develop a deeper understanding of Japanese culture: they even hired some Japanese anthropologists to give long- term training to Indian developers, including telling them about Japanese culture and mythologies. Eron and Gowing also used training and informal linkages indirectly to manage attrition and motivation. In the maturity stage of their relationship, the onshore and offshore staff were brought psychologically closer using ˜buddying , a technique born out of scuba diving; an individual working onshore would be paired with an opposite -number ˜buddy to link the offshore staff (in India) to the UK context while retaining an informal link ˜home for staff located in the UK. These links back home help to counter some of the feelings of loneliness and alienation a developer may experience on-site and serve as an umbilical cord to the identity of the mother company.

In developing a perspective and implications for attracting, retaining and motivating staff resources, five key questions that reflective managers need to consider are summarized in box 11.2.

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Box 11.2 Key questions: managing people
  • What environmental factors influence the recruitment and retention of staff? What formal and informal networks can be created to provide a regular supply of trained people?

  • How attractive do the developers find the company and the type of work that is being done?

  • What structures of motivation can be put in place in the organization that are compatible with the socio-cultural context within which the developer is situated?

  • How can training programmes be developed that help to foster deeper cultural understanding and transcend superficial information that fuels stereotypes?

  • What strategies of training can be developed to try and create a ˜hybrid manager with the capability to ˜straddle across the partnership?

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