satisfied workers ensure satisfied clients - the cornerstone for any great business.

Importantly, however, the company management – often the single handed owner - has to judge the contributions of their workers looking at things beyond just labor. Talk about HR management with small and medium entrepreneurs, chances are that one can easily end up drawing wrong impressions about those who run these companies. They can deal minutest curiosity about their business opportunity, growth chart, warranty or even matters like favorite holiday destinations for customers with cross-questioning. But when it comes to the perplexing issue of HR management, they are more often than not - clueless.  A survey revealed that there is plain ignorance about this among the neighbouring ‘Lalas (Delhi names for these smalltime business operators)’. The worse part is their confusion as they seldom raise the issue and generally discard any suggestion of enlisting outsourced consultancy services.

Take Aways The primary challenge on retaining people is the need to take into account three key aspects namely career growth, knowledge growth, and financial benefits. Humble background fetches greater loyalty. Prefer an above average boy from a modest background than a high flying new generation highly ambitious youth. These lots are in hurry and can desert anytime. Workers with humbler background, in fact small towns, carry less extra baggage of looking for perks like funding for holiday trips or financing their other allowances like conveyance when one can go around in a city bus.

As one interacted with a few such entrepreneurs, the finding was that the smaller companies have to continually balance on a tightrope of uncertainty, often measuring profit margins, keeping company data base intact and retaining the workforce for a matter of months, or even weeks.

The problem as regard workforce management is more complex as an employee leaving the company will either join a competitor or become a competitor by opening their independent ventures. “They take away the customers,” commented Prakash Chander Joshi of an electronic showroom, Bootcom Ltd.

True, the complications in employee management are much more pronounced in the case of smaller business establishments than dealers/distributors or large multi national companies.  

Many say that in these companies, generally the owner himself dons the HR-hat if he is aware of the practices. Otherwise the whole concept of people-management is simply neglected. “Hum kya kar sakten haen (What can I do)?” is the usual refrain. And at best, the approach is typically desi – adhocism.

Resignation Problem

In addition to inherent intra-company reasons, small company owners would say that a high rate of attrition (resignation) has come to stay owing to factors that are beyond their control.

Almost the entire workforce today is on the move. The younger lot including the female workers are too ambitious and growth oriented and thus do not mind moving from city to city. Shanti Jadhav says, within 5 years of her career with IT major HP, she has moved to three places. Agreeing with her readily, an East Delhi printing businessman, Shailesh Kumar says, “Even big companies can not satisfy the hunger for growth and money of the upcoming generations. All post graduate degree holders expect salaries in terms of Rs 75,000 or above. We the small entrepreneurs have immense limitations when it comes to an employee’s liking and ambitions.”

Moreover, there is technological factor. Among IT companies, cyber cafés etc, several employees leave hardware handling for software or even consulting.

Generally, the employees leave for higher salaries or better-known brands. From a retail colony shop at Rohini in North Delhi last year, at least six workers jumped to big ticket players like Cisco, Dell and HDFC Bank. There’s another twist. Big companies and distributors of major manufacturing houses also prefer to pick up employees from the smaller ones. “The best quality they get in such employees is their zeal for hard work, knowledge about local conditions, possible areas of business growth,” says Kumar.

On the other hand, the general experience is that the big companies simply say, “We just picked up the talents, why call it poaching?”  

In some sectors, therefore, efforts to work out ‘unwritten agreement’ not to touch each other’s employees have not yielded positive results.

Importantly, what goes without saying is that there is always a need for ‘trained people’, particularly those who are aware about the industry, the locality and the best way to poach people from the smaller companies.  These instances only combine together to strengthen one fact that the problems for the small companies, thus, grows manifold as regard their people management.

“People undergo training from us and then cease to work and leave us in the lurch when they have opportunities coming in from large and branded companies,” lamented a Mumbai-based Vinod Penderkar running a showroom of LG television and air conditioners.

Such is the desperation that several smaller companies are already talking about precautions. Among IT resellers, there is an attempt to face the challenge in a united manner whenever possible through associations or so. In Mumbai, IT resellers have floated Trade Associaion of IT (TAIT) to handle these problems.

There’s already an emerging trend. Taking the lead from software companies, leading banks and BPO centers, the resellers and small companies have started now insisting on bonds for their workers. Under the bond, a part of the salary is held back and is paid only after completion of a fixed tenure. Though this does not fully compensate investments in hiring, giving initial work exposure and training the person, it does to an extent act as a deterrent for employees.

However, there are others who take a rather helpless or to an extent pragmatic view and say that in today’s world no strategy can checkmate resignation problem. “This is a global phenomenon like corruption. In fact, I look forward everywhere for guidance to keep my people. Often I keep distributing pedas (sweet) to employees to keep them in good humor. I have learnt from some big companies and even give Diwali bonus or gifts in kind; but even these hardly work,” remarks Sukumar Sen Gupta running a confectionary shop in South Delhi.

There is yet another problem area. Small entrepreneurs – nationwide - are faced with hiring problems as profit margins are largely getting thinner these days and they are unable to cope with the unprecedented pace of hike in pay packages for employee. “With increase in the number of jobs offered by the call centers in the metros, lots of youngsters prefer to join them instead of us. And experienced manpower is always in short supply,” says Sen Gupta.

Responsibility

But as the proverb says, two hands are required to clap. In this regard these small entrepreneurs too ought to gaze into their own heart vis-à-vis handling (read mishandling) the HR issues, that is man management.  Most equate their trade as any other business of garnering profits and deal with employees in a manner a grocery shopkeeper would do with his part-time boys, complain workers.

They suggest that in order to ensure better coordination between workers and these companies, it is important that the ‘job profile’ of employees is kept well structured.
Experts say that for this, the owner/management ‘should clear’ a candidate’s queries about the job during the interview process itself. “This shall help you find out his psychology and how to mentor him after joining. Generally, companies make their employees do all sorts of work under the sky from accounting to sales related presentations or even to visit post offices, or pick up children from schools. This is not good,” says an employee with a local showroom in Delhi.

However, it goes without saying that the remuneration obviously is the main catalyst for movement of the workforce. Therefore, it goes without saying that you should ensure that payment should be proper.

This has to do with the mindset. The typical shopkeeper wants to keep the profits to himself. And he will justify this by saying that he is bearing the risk, the fact remains that employees too contribute in a significant way to the business, points the LG showroom owner Vinod Penderkar in Mumbai.

Dos and Don’ts

This brings us to the key aspect of the checklist of dos and don’ts for smaller companies. Foremost of all, the “lackadaisical approach of adhocism” is a principal bane. Adhocism is killing but it’s a reality. Generally, companies don’t have a backup plan in place in case of a few employees suddenly leaving the organization.

Going by the size of the company, a contingency fund for short-term losses or emergency and temporary hiring or outsourcing plan in place does help, say HR experts. In metros, for instance, some companies these days try to keep “extra employees in their organizations” because they know obviously that someday they will leave you.

A good employer, says HR officials, generally give the impression that they are willing to “shares profits” with employees in terms of “facilities” and not necessarily in terms of money. It is in this context, one HR consultant suggests that employees could be kept in good humour by offering them accessories like mobile handsets, dresses. “Some also give commissions to employees, giving the impression that this is the share of profit. This enhances the sense of belonging,” says a retail executive with Indian washing machines and other brands.

But some owners discard this advice and say, giving commissions is also dangerous. “If we do so, there might be situations where the employees may transfer our leads to our rivals. So if we give Rs 6000 as commission to our employees, our rivals may offer them much more than that,” says one of them.

However, some say that employees can be given a better sense of belonging if they are given benefits like group insurance etc.

Sanjeev Manocha of an IT company in Delhi says, “We offer a challenging and growth oriented environment to our employees where they can grow and become successful. For that purpose we give them rewards in terms of cash or give them annual and even half-yearly increment to their monthly salary. They are also given rewards like television sets, mobile phones etc. This helps us in retaining our employees and prevents them from joining other organizations.”

Wrap Up  

In the ultimate analysis, HRD specialists say it is basically ‘common sense and wisdom’. It is important that the owner of a company or a team leader especially should not speak loosely like telling employees that this work could have been done in a day. They should never hurt any employee’s sentiments. Bad words about alleged ill-treatment meted to workers - sometime with malafide intention also - spread much faster than technology and this can only result in permanent damage to an organization’s reputation.

Swati Deb