Responding to the changing workforce
| DOI | https://doi.org/10.1108/14754390680000912 |
| Pages | 3-3 |
| Published date | 01 September 2006 |
| Date | 01 September 2006 |
| Author | Devyani Vaishampayan |
| Subject Matter | HR & organizational behaviour |
3
Volume 5 Issue 6 September/October 2006
STRATEGIC COMMENTARY
,
Thought leaders share their views on the HR profession and
its direction for the future
DEPARTMENTS AT A GLANCE
STRATEGIC COMMENTARY
,
Q&A
,
HOW TO…
,
PRACTITIONER PROFILE
METRICS
HR AT WORK
REWARDS
,
RESEARCH AND RESULTS
,
,
,
,
W
e’re operating in an
increasingly fast-changing
environment and one area
where this change is expected to
accelerate further is the employee
workforce. Three major factors will shape
the nature of work over the next decade:
1. Demographics
By 2010, of the 400 million new entrants
in the labor market, only five percent will
come from western, industrialized
countries. Two regions that continue to
show an increase in the working age
populations are Asia and the US; with
271 million from Asia Pacific alone (50
percent of which will be in India and
China). For most organizations, future
growth markets are also in these regions.1
Since both the demand (markets for
their products) and supply (skills needed
to deliver this) will come from the
emerging markets, it makes business
sense for organizations to source its
people from there. The impact of this
change can already be seen in retail
banks, or companies like Microsoft and
IBM, whose international operations are
getting more dominant than their
traditional markets. HR’s challenge is to
tap into this different source of labor
supply and manage a culturally diverse
workforce.
2. Technology
Technology has led to the rise of the
“knowledge worker” which demands a
higher level of cognitive skills from
people. As communication costs fall,
there’s been increased mobility leading to
outsourcing gaining popularity.
The common misconception about
outsourcing is that it’s cost driven.
However, the drivers for each separate
industry can be very different. The
enticement to companies of a worker
who earns UK£2 against someone in the
UK, who can cost ten times that amount
is obvious. My experience at Citigroup in
1988, however, showed that what started
as “cheap labor” of software engineers
moved up the value chain very rapidly,
resulting in development of complex
financial product software in India – all
over a period of five years.
Similarly, while working for Lucent
Technologies in the late 90s, the decision
by Bell Labs to set up its R&D centers in
India was prompted by the high quality
of scientific skills available.
HR’s role in facilitating outsourcing
Many countries now understand the
benefit of outsourcing. HR professionals
can play a key role in helping
management have a strategic
understanding of the issues involved
(actual availability of talent versus
statistics, attraction and retention efforts
needed, costs and so on). A call center in
India, for egg, typically puts applicants
through a rigorous seven-stage screening
with a 90 percent acceptance rate, while
a similar one in the US has a two-stage
process with an average acceptance rate
of 50 percent.
Another facet of outsourcing is the
effort HR must make when jobs in the
home countries are affected. At AXA,
this process was a success, with union
support, training programs and generous
severance packages.
3. Social trends
Work-life balance is now key to what
employees are prepared to “give” to an
organization. Other influential factors
are organizational “values,” corporate
social responsibility and leadership based
on integrity, not just hierarchy. The
challenge for HR is to recognize the
changing nature of the employee-
employer relationship – and move away
from the traditional job structure, to one
which facilitates a different hiring
strategy, flexible work patterns,
compensation structures and career
planning.
Designing flexible HR processes suited
to local environments is going to be
increasingly important. A rapidly
changing workforce is going to need HR
professionals who have lived and worked
internationally and who can create a
competitive organization with strong
consistent values across diverse cultures.
Reference:
1. ILO Global employment trends 2003.http://www.ilo.org/
Responding to the
changing workforce
HR professionals must prepare for the imminent shift in employee
demographics, technology and social trends, warns Devyani Vaishampayan.
Devyani Vaishampayan
is regional HR director at BG
Group, EMEA.She has
previously held positions at
Citgroup,AXA, Lucent Technologies and
PriceWaterhouse.Her expertise lies in addressing
strategic issues around organizational
effectiveness, resourcing and talent.
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