A seemingly healthy, well-performing company can be vulnerable than you might think because of a build-up of corporate cholesterol; natural human dynamics that limit communication, creativity and collaboration. Like how your physician will tell you, rather than waiting for the heart attack to strike, executives should consider changing firms structure, rewards and processes while performance is still good. New business models, machines replacing humans, millennials shaping the new models of engagement, will tell you how urgent is the need for change and what kind of changes to contemplate. Formalization and commodification of work is seen to be increasingly taking place with an open world economy. It is almost like change for the sake of change. It is not restricted to technology as the disruptor alone, but employees and their approach to work. The organization structure needs to emphasize on healthy disrespect for hierarchy and make jobs more dynamic. The essence of the shift is a simple but a big idea: the idea of a "job," with all its protected artifacts like job title, level, and job description, is starting to go away. What is its replacement - people being hired "for a purpose”. You see employees change jobs every two years; they are not looking to increase their pay, they are looking for a stronger connect with the purpose, they are not leaving for better managers that they don’t know as yet, but for the disenchantment with the current one. Cross-selling is a failed concept after repeated effort and incentive programs have rarely got people to collaborate, but in most extraordinary and difficult situations, we have seen unified purpose bring people together; how the bank employees worked unremittingly to fight the unintended consequences of demonetization is a recent example of it. It calls for reinvention for employees and employers. Unlearning agility is the newest competency individuals and businesses are trying to build. Most organizations and their leadership are in a state of conflict. The first stage of approaching the midshift is articulating it and simplifying it for people to appreciate the “why” and “how” of it. Accelerated innovation requires accelerated adoption, and this needs most focus for the more experienced generation, who has the task of leading the way and setting the direction. Today we need idea entrepreneurs, a new type of cultural player and create an environment that encourages their abstract thinking. Organizations need to shift their focus from managing people to managing culture and that needs clarity in direction. Your likelihood of failing will be low if you start by keeping customer in the center of it. The mindset needs to make it simpler, convenient, efficient and differentiated for customers. Organizations need to replicate the same experience for their own employees. It needs to be defined in the context of your business and delivered consistently. We have seen companies fail and lose their relevance, but the same people in those companies have adopted, unlearned and continue to stay the course. Our current performance management does not focus on the unique strengths of people and that is the first place where we miss appreciating diversity and hence have agreed to the fact that only few will succeed. Mindset change is about success for everyone and not for a handful. Some critical re-thinking about the future of work is necessary. Future is anything but in our hands but it is clear that it will not follow a universal linear trajectory and the objective of our Imagineering workshop and this paper is to help stimulate discussion about how to open up the future more for the unknown and unexplored.
	
	
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 (The article is authored by Sandeep Chaudhary, CEO, Aon Hewitt India Consulting. This article is part of the six-article series, ‘Aon #ImagineeringTomorrow: A Co-creation Journey’, with <a href="https://www.google.co.in/url?sa=t&amp;rct=j&amp;q=&amp;esrc=s&amp;source=web&amp;cd=4&amp;cad=rja&amp;uact=8&amp;ved=0ahUKEwjy5ePdwdDTAhWKLY8KHYcoDRMQFghWMAM&amp;url=http%3A%2F%2Fwww.aon.com%2Findia&amp;usg=AFQjCNHM5veaFldq4b8NerLXds3EAZIESw&amp;sig2=8Ij7hrxcn66nJWoJrP7GNA">Aon Hewitt)
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ImagineeringTomorrow: Critical re-thinking about the future of work is necessary. Here's why

<img class="gwt-Image" src="/photo/56810860.cms" />“Those who have learned to collaborate and improvise most effectively have prevailed” - Charles Darwin 
 
This quote may have been lost in time and uttered mostly in evolution theory circles, but its relevance in today’s VUCA environment is higher than ever before. 
 
A closed group of distinguished Business and HR Leaders representing <a href="http://www.businessinsider.in/searchresult.cms?query=technology&amp;sortorder=effectivedate">Technology</a>, <a href="http://www.businessinsider.in/searchresult.cms?query=manufacturing&amp;sortorder=effectivedate">Manufacturing</a>, <a href="http://www.businessinsider.in/searchresult.cms?query=fmcg&amp;sortorder=effectivedate">FMCG</a> and Pharmaceutical sectors came together in Bengaluru to discuss the future of the workplace and took an educated view to not just the workplace but how “work” itself will take shape in the future. The discussions both as a plenary and in small groups pointed towards three conclusive themes… 
 
1. Work of the future will cease to operate like a singular continuity and function more like an aggregation of projects or “gigs” capitalizing on experts across different disciplines to come together and deliver a business result 
2. There needs to be a transformative change in mindset right from how leaders prepare for the business of the future to how employees remain agile around skills to remain relevant in a fast changing yet demanding environment 
3. The first step to realizing these truths would be to accept the fact that generalists would be a thinning herd and specialists/experts and aggregators (human or virtual) would be the future 
…and the glue that would bind these 3 themes together and help crystalize the workplace is Collaboration. During the discussion around collaboration the think tank that brainstormed around it tried answering are some interesting questions - 
 
What is Collaboration of the future? Collaboration in the future workplace would be a kaleidoscope of dimensions involving man and machine that would change the very fabric of modern enterprise. Right from planning an outcome to staffing a project to finally executing and disbanding would require collaboration at the center. Intuitive tech, skilled professionals and access to a gargantuan data universe is the key to a success in such an environment. 
 
How would people collaborate in gig economies? In a gig economy, success and failure would depend solely on how quickly and effectively skills and expertise can be sourced and managed. Revolutionary platforms like Slack would allow virtual workgroups and communities to come together to solve unique problems and create value. Data democracy would therefore be a critical parameter for collaboration breaking down level &amp; grade barriers and Transparency would be the core principle driving key business decisions in the future workplace. 
 
How would structures change to accommodate a collaborative environment? As HR professionals it is important for us to understand how people constructs would change in the future. The concept of collaboration will evolve to the idea of pod-collaboration where geographies and pyramids would become irrelevant but the key to success would be availability of information when needed. Digital and Agile would no longer be special teams but core capabilities across the organization. An inordinate amount of focus however will go towards building communities of practice instead of traditional hierarchies. These communities would be the custodians of skills and capabilities and provide the necessary fuel for collaboration across the future workplace. 
 
 
How will the nature of work change in this collaborative environment? Unlike today’s linear, continuous work environment, work in the future will be fluid with people carrying different levels of expertise coming in at different stages of iterations through an environment of collaboration. This means it will be essential to build a Directories of expertise or communities of practice/interest to staff this kind of work on a real-time basis. The important question would be how we can bring squads together in Tour of Duty style staffing so expert teams can perform an operation and then disband immediately after. 
 
How will knowledge get managed in the future workplace? For the collaboration paradigm to take shape, knowledge has to be collected, curated and stored in a way that is easily accessible to all. Free flow and access to information is the key to the success of project/”gig” style of work. Sentient machine learning databases would replace traditional knowledge management systems to make this a reality. 
 
How can we action this change? What will it take? This question sought answers at different levels. 
 
• For an employee this would require roles to be reimagined and rewards to have a stronger alignment to project outcomes. Performance metrics would track project outcomes rather than individual goals and in turn reward collaborative behavior. Project based compensation would essentially replace monthly salaries. 
• Processes need to be reimagined not only to create virtual teams but also to include intuitive tech for real time information sharing and collaboration. 
• Organization Development engines would need to produce communities of practice and expertise so as to constantly fuel the gig economies. 
• Leaders would need to build the tenets of collaboration and front run the culture change in the future workplace. 
The future holds a huge spectrum of opportunities that we possibly can’t fathom in its entirety. Yet it is important to ponder on some of these questions which inexorably point to possibilities which could shock the way work and employment would exist in this world. 
 
Structures, policies, practices and beliefs will be shaken out of their foundation and replaced with new, more nimble constructs which would serve the connected world. Purists will be compelled to rethink the meaning of “jobs”, “work”, “enterprise”, “performance”, “capability”, “resources” and “rewards”. The true essence of business may remain the same but the current shape and form of modern organization will most likely cease to exist. In a world like this we need to adapt rapidly and prepare ourselves by being early adopters of some of the principles that emerged through this initiative. 
 
<img class="gwt-Image" src="/photo/56810925.cms" /> 
 
(The article is authored by Abhishek Sen, Director, Performance, Rewards and Talent, Aon Hewitt Consulting. This article is part of the six-article series, ‘Aon #ImagineeringTomorrow: A Co-creation Journey’, with <a href="http://www.aon.com/human-capital-consulting/default.jsp">Aon Hewitt</a>) 
 
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ImagineeringTomorrow: The Talent Network

<img class="gwt-Image" src="/photo/56331384.cms" /> A few weeks ago, we had invited a set of chief executives and HR leaders of large Indian companies and conglomerates to a discussion on the future of the workplace. The group around the table represented some of the brightest HR and business minds in the country and, over cups of coffee, the conversation veered towards the oft discussed area of how automation is affecting the workplace. We have all been talking about it – in some ways more in abstractions than in real figures or examples. Here was the first time we had people talk real life experiences of how their organizations are actively working towards a future where jobs will be automated and employees would be redundant. 
 
The reader might still stifle a yawn – yes we are all aware of it. It’s the future of the world. And I would have probably felt the same way. But what shocked me personally as I sat on that table with ten of India’s largest companies representing different industries, is that it suddenly was all too real. Software engineers were being gradually made redundant through “bots” that could their task more efficiently, agricultural scientists were losing jobs because there were apps that could interpret the nature of problem that was affecting crops, paralegals were not required because AI tools could look for issues in legal contracts and summarize key points for lawyers to work on. 
 
Let’s put things in context – as India adds close to a million people to the working population every month, it is critical for the economy to constantly add jobs. But India over the last few decades has had a leap from an agricultural economy to a service oriented economy – and while in the recent past there has been significant push towards driving the manufacturing sector, the results are still to be felt. As a broad estimate while the value added in the services sector has slowed like in the agricultural or industrial, it still is growing at about 1.4 times the industrial sector. Interestingly the job creation story works in the reverse – in two decades the percentage of employment in the services sector has gone up by only 3%. And on top of this, over the last 5 years most Indian companies have seen employee costs grow faster than revenues. 
 
So as companies face a more complex global environment where countries are increasingly, to quote the Economist, “closing the gates and raising the drawbridges”, there is little doubt that the focus for the future lies in optimizing cost of delivering products and services to remain competitive. Therefore it's no surprise that Indian companies are rapidly figuring out ways to drive higher productivity through automation. This automation, as I mentioned earlier, is happening equally in both the manufacturing as well as services sectors. But as jobs disappear, there is a parallel increase in the need for high end jobs – in technology, services and even manufacturing, but these jobs are not in India. Our education system produces very few people who are truly capable of taking up these jobs that. 
 
Are we therefore heading towards a future where we will actually not be able to provide employment for people joining this workforce? And are we also heading to a future where companies will need to retrench significant number of their workforce who will lose their jobs to robots and Artificial Intelligence software? How equipped are we to reformat the structure of our education system to produce better quality talent that cannot get replaced by machines and software? And, as one our participants suggested that day, as companies start having to hire less and fire more will the government bring in legislation against retrenchment? And finally is there a humane way to go about the process of telling that 50 year old agricultural scientist whose job is being replaced by an app that he needs to learn a new skill – and really, can he? 
 
As I left the room that day, I couldn’t help but think of the future for my young daughter – I should actively encourage her to not be an engineer or accountant but perhaps focus on playing a game or learning ballet. 
 
<img class="gwt-Image" src="/photo/56331394.cms" /> 
(The article is authored by Anandorup Ghose, Partner – Talent &amp; Rewards, Aon Hewitt Consulting. This article is part of the six-article series, ‘Aon #ImagineeringTomorrow: A Co-creation Journey’, with <a href="http://www.aon.com/human-capital-consulting/default.jsp">Aon Hewitt</a>) 
 
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ImagineeringTomorrow: To the ballet class

<img class="gwt-Image" src="/photo/55995729.cms" />Large deposits in bank accounts due to demonetization is expected to soften bond yields and also lower rate of interest in the economy as banks will be forced to use the extra cash to buy more government papers and rush to lend money to the customers, or do both. With people unable to spend due to tight liquidity, this could also lead to slower growth, which would leave enough space for the RBI to cut rates, economists and bond dealers said. (Source – Economic Times) 
 
The lower and stable bond yields bring stability in the economy; however consistently reducing bond yields has an adverse impact on the financials of the companies especially where the employee benefits liabilities are concerned. 
 
We can see from both the Graph as well as the table below, that Post Demonetization, the zero coupons Government bond yields as on 22nd November has dropped significantly. The zero coupons Govt Bond yields have fallen by 28 bps to 73 bps since September 2016 and by 79 bps to 149 bps since March 2016 over different tenures. Specifically Yields on a 10 year zero coupon bonds has fallen by 55 bps since 30th September 2016 and by 115 bps since 31st March 2016. 
 
<img class="gwt-Image" src="/photo/55995632.cms" /> 
 
Fall in the Bond Yields has a direct impact on the balance sheet and the P&amp;L of the organizations, as In India, the defined benefit obligations are determined with reference to the market yields at the balance sheet date on government bonds of appropriate tenure according to the Para 78 of the AS 15 (Revised 2005) and Para 83 of the Indian Accounting Standard (Ind AS) 19. Also, the currency and term of the government bonds need to be consistent with the currency and estimated term of the post-employment benefit obligations.” 
 
<img class="gwt-Image" src="/photo/55995653.cms" /> 
 
While the total Employee benefit obligation depends on many factors, the impact of reduction by 50 bps in the discount rate is anywhere in between 0.83% to 8.28% depending on the Future working life time/Duration of the liabilities on which the Discount rate depends Assuming an Average future working life time of 10 years, in the post demonetization scenario, the impact of the decrease in bond rates may result in the liabilities to increase approximately by 5% since September 2016 and by 12% since March 2016 which for organizations with large liabilities is quite a big impact to the financials. 
 
<img class="gwt-Image" src="/photo/55995660.cms" /> 
 
What Demonetization means for funded employee benefit schemes 
Assets under funded post-employment benefit schemes are primarily invested in debt securities, the reduction in govt. bond yields will lead to reduced future earnings and hence more contributions may be required to match both the current and future liability. Though the self-managed investments may enjoy higher market/fair value of assets invested in the past at higher interest rates, the future contributions and reinvestments would be invested on lower yielding bonds. The trusts who have invested through the Life Insurance companies may see negotiated returns in future, if yields on govt. bonds remain at this level and/or there is further reduction. 
 
Demonetization and Exempt Provident Funds 
India’s labour ministry passed a new regulation on November 11 allowing for inactive employee provident fund (EPF) accounts to accrue interest. As per the notification, EPF accounts that are inactive for 36 months or more will no longer be considered ‘inoperative’ and will continue to earn interest. As such, the EPF account will continue to have an active status irrespective of the employee’s termination, unless the employee withdraws the cash from the account or gets another job within two months with another employer. Moreover, the new regulation will allow for the transfer of an existing EPF account to one under the new employer. The interest payable is notified annually, and for 2015-2016, it was set at 8.8 percent.. 
 
From the current EPF interest rate of 8.8% , it is unlikely that the Government would reduce the next year rate that steep to match the current bond yields. Given this scenario the exempt PF funds will have to meet any shortfall in the funds that may arise in future to meet the obligations . 
 
Companies that have their own exempt fund have two future risks- 
 
• Investing the new contributions in Bonds yielding the promised guaranteed interest. 
 
• Reinvesting the monies from the matured bonds in Bonds yielding the promised guaranteed interest 
 
For now the market/fair value of assets is on the higher side as the companies have invested in the past in bonds with high yields , however this advantage will be lost if the situation continues which appears to be a certainty for now. 
 
May be it is time for companies with exempt provident fund trusts to re-look at their PF strategy. 
 
The above article does not provide any legal/statutory advice and should only be used for general reference only. 
 
(Image Credits: Economic Times) 
 
(About the Author: The author of this note is Chitra Jayasimha, Actuary and Practice Leader, RFM at Aon Hewitt Consulting, India.) 
 
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Impact of Demonetization on Employee Benefit liabilities & Exempt Provident Fund Trusts

<img class="gwt-Image" src="/photo/53490633.cms" /> 
 
What ails the quality of HR today? Why can’t we find good HR Heads who can understand and align to business? 
 
 It was a simple, innocuous question asked by a very senior, seasoned banker client one afternoon when we were discussing notes about what was wrong with the (HR) world. It got me thinking and I reflected on what I had seen and analyzed over the many years spent in this industry working with and learning from the best HR professionals in the country. 
 
What struck me was the lack of mobility I had seen between business functions and HR, a specialized area that in most cases was as remote from the front line revenue generating functions as an academic degree is from practical work experience. Enough has been said and ranted by voices across the globe about the changing role of HR, how it needs to be more strategic than before and be a business enabler rather than a support function. All fair points but has this been practiced in terms of managing the roles of business and HR in tandem? How many cases do we see where senior business leaders move into HR, or vice versa. If HR needs to better grapple with and align to business, shouldn’t HR have the experience of actually getting their hands dirty in the field? 
 
There are some best in class companies who invest in career tracks for their potential CEOs, who are mandated to manage HR before they hit the top spot. There are others who are so business driven in their DNA, that they struggle to find business aligned HR Heads and move people from within business to manage the human capital aspect. In either case, there are only a few examples of how top performers in business see (or are made to see) a stint or even a career in HR as something to aspire for. It may be argued that many in the business don’t fancy a move to HR either because the propensity to earn (especially on the variable component) diminishes considerably or simply because HR is less about leading a business and more about managing the fuzzy and grey world of human emotions and expectations, which more often than not translates into mundane transactions. 
 
In a country that is hurtling towards economic prosperity on the back of a raging young workforce and which is the envy of most of the world on the basis of its super productive population, it is ironic that managing this workforce while labeled as ‘strategic’, still has little contribution from the business side of organizations. Perhaps it’s time that we stopped blaming HR for not being a business driver and visionary thinker, but start to encourage and push our top performers from business to move into a function that can better manage the most critical asset the company has, by having business experience at the helm. 
 
Long back when I left the world of high profile corporate banking and joined HR consulting, I went through a period of doubt, indecision and ‘post purchase dissonance’ especially when riled by colleagues and friends who saw the move from business to HR as strange, inexplicable and counterproductive. I remember my consulting practice head tell me that end of the day you will manage a business; it just happens to be of HR, so what’s the big deal? If more of us can see the importance of business experience in managing HR, and be able to bring in the ground realities into an area that is often bemoaned of being theoretical and far removed from the war zone, the world will start to become a better place to work in and work for… 
 
About the author: Roopank Chaudhary is an Associate Partner at Aon Hewitt 
 
<a href="http://sdmimd.ac.in/hrcon2015/images/n1.jpg">Image source</a> 
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The business of HR

<img class="gwt-Image" src="/photo/53395039.cms" /> 
What ails the quality of HR today? Why can’t we find good HR Heads who can understand and align to business? 
 
It was a simple, innocuous question asked by a very senior, seasoned banker client one afternoon when we were discussing notes about what was wrong with the (HR) world. It got me thinking and I reflected on what I had seen and analyzed over the many years spent in this industry working with and learning from the best HR professionals in the country. 
 
What struck me was the lack of mobility I had seen between business functions and HR, a specialized area that in most cases was as remote from the front line revenue generating functions as an academic degree is from practical work experience. Enough has been said and ranted by voices across the globe about the changing role of HR, how it needs to be more strategic than before and be a business enabler rather than a support function. All fair points but has this been practiced in terms of managing the roles of business and HR in tandem? How many cases do we see where senior business leaders move into HR, or vice versa. If HR needs to better grapple with and align to business, shouldn’t HR have the experience of actually getting their hands dirty in the field? 
 
There are some best in class companies who invest in career tracks for their potential CEOs, who are mandated to manage HR before they hit the top spot. There are others who are so business driven in their DNA, that they struggle to find business aligned HR Heads and move people from within business to manage the human capital aspect. In either case, there are only a few examples of how top performers in business see (or are made to see) a stint or even a career in HR as something to aspire for. It may be argued that many in the business don’t fancy a move to HR either because the propensity to earn (especially on the variable component) diminishes considerably or simply because HR is less about leading a business and more about managing the fuzzy and grey world of human emotions and expectations, which more often than not translates into mundane transactions. 
 
In a country that is hurtling towards economic prosperity on the back of a raging young workforce and which is the envy of most of the world on the basis of its super productive population, it is ironic that managing this workforce while labeled as ‘strategic’, still has little contribution from the business side of organizations. Perhaps it’s time that we stopped blaming HR for not being a business driver and visionary thinker, but start to encourage and push our top performers from business to move into a function that can better manage the most critical asset the company has, by having business experience at the helm. 
 
Long back when I left the world of high profile corporate banking and joined HR consulting, I went through a period of doubt, indecision and ‘post purchase dissonance’ especially when riled by colleagues and friends who saw the move from business to HR as strange, inexplicable and counterproductive. I remember my consulting practice head tell me that end of the day you will manage a business; it just happens to be of HR, so what’s the big deal? If more of us can see the importance of business experience in managing HR, and be able to bring in the ground realities into an area that is often bemoaned of being theoretical and far removed from the war zone, the world will start to become a better place to work in and work for… 
 
About the author: Roopank Chaudhary is an Associate Partner at Aon Hewitt 
 
<a href="https://www.paychex.com/a/i/articles/hr-help.jpg">Image source</a> 
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The Business of HR

<img class="gwt-Image" src="/photo/50901032.cms" />Multiple fold growth over the last few decades has spurred the aspirations of businesses owned and run by families in India. The next generation is being inducted into the business as a natural succession. But, on one hand when older generations tend to focus on core functions that can improve efficiency and reduce cost, the next gen likes to focus on strategy and brand building. 
 
The growth has brought business to a different stage where what worked earlier may not work anymore. Perspectives have changed, customers have evolved, competition has taken a new shape and fresh talent is in demand. How important are these stages? How do we come to terms with realities and take realistic and relevant decisions? 
 
<img class="gwt-Image" src="/photo/50900999.cms" /> 
 
Family Business Evolution Stages 
 
The stages of growth in a family business are reasonably well understood. However, taking a generic view of growth may become misleading for an organization. 
 
To move from the Setup and Inception stage to a stage of functioning 
Survival, organizations require investment with a sole focus on breaking even in the business. It is an owner dependent stage. 
 
The first challenge is to move from a few-people organization to a company with a larger employee and customer base. It is a people and relationships dependent stage. 
 
The Success stage is a transformational stage when organizations make a choice to move with bold bets or steady growth. The most dramatic shift in a business run by families takes place at this stage. External professionals at senior levels are sought to drive expertise, processes and productivity. Invariably, due to lack of systems and processes, attracting talent becomes a challenge. Those who do join are viewed with skepticism and are expected to produce quick results increasing the chances of failure. The next gen entry into the business at this stage has its own challenges. Their need to establish themselves is very high and they prefer taking the business to the next level quickly. The next gen’s ability to prevail with a wider worldview and capability drives the organization to become more process and expertise-driven. 
 
The Take-off stage is an expansion stage. With systems, processes, capabilities and financial sustainability, diversification and investment into newer adjacent businesses seem the logical next step. This is the stage of a professional, dependent organization. 
 
After the take-off stage, the scale and size of operations demand streamlining and synergy. This is the Resource Maturity stage where the ownership and management may even become independent making the top leadership responsible for the capability and expertise in managing the complexities of the business. 
 
At the “Global Corporation” stage, the scale and challenges of operations evolve organizations into transnational corporations governed by shareholders and a board managed by a global talent pool. This effectively means that a professional board where the management may or may not have any family members involved runs the business. 
 
<img class="gwt-Image" src="/photo/50901004.cms" /> 
 
Perspectives and Mindsets at Different Organization Evolution Stages 
 
The mindsets are critical pointers to the perspectives and decision-making in various growth stages of an organization. 
 
Personal investment de-risking mindset: This is a personal investment stage so the mindset is geared towards de-risking the personal investments. 
 
Commercial mindset: This is a relationship-driven stage with a significant dependence on individual relationships where the owner is at the center of these relationships. 
 
Transformational mindset: Success stage of growth is focused on high productivity and efficiency. Focus is to create a virtuous cycle of satisfied customers, interested investors and employees keen to work with the organization. 
 
Expansion mindset: While the local markets have opened up, Indian companies have geared up to take on global markets, acquiring companies in developed economies. There are examples where sound financial and business synergy logic have led to acquisitions, but there was not enough management bandwidth to ensure integration. M&amp;M, Apollo Tyres, Wipro, HCL, Avantha Group, etc. have succeeded in expanding through acquisitions. 
 
Empowering mindset: Mature and successful companies are able to provide empowerment to customers, suppliers and employees. The owner leads the organization, which is governed more by principles, strategies, processes and policies. 
 
Global mindset: Sustainability of the business, society and planet becomes pronounced in this stage of an organization. 
 
Understanding and Assimilating the Differences 
 
The above mindsets exist in some form in all organizations and even though there is always a predominant mindset that drives decision-making, it does not mean that these mindsets are mutually exclusive. Knowing the mindsets and actively allowing the next stage mindset to germinate either through next generation family or external professionals is what may be required. A deeper understanding of the organizational stage and related cultural realities can help family businesses to take the right decisions. This may also help the different generations of family businesses appreciate the perspectives of older or newer generation in the context of prevailing mindset! 
 
(The article is authored by Anurag Aman, Director, Aon Hewitt) 
 
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Here are stages and perspectives behind running family
businesses in India

<img class="gwt-Image" src="/photo/50639166.cms" />Over the past six months, several startups have been on laying off spree with a strong push from investors to reduce burn rates and show business results. 
 
There is a clear demand for business models to evolve, to be more profitable, and to adapt to fast changing and ever demanding customer expectations. This, combined with the pace of technological advancements, has made it critical for companies to systematically build their organization’s capability by changing rotting codes, periodic review of market strategies, scaling hiring and ensuring right staffing. 
 
In the eye of the storm 
 
Often, startup founders have stressed upon the need and importance to have the right people. In the midst of fierce war for talent, startups are competing with large technology companies for literally same pool of human capital. While large corporates hire based on meritocracy and qualifications, startups are on a look out for talent, who along with merit possess qualities such as managing ambiguity, agility, spontaneity and innovation. Given the constant tussle between hiring talent that is aligned to organizational culture versus talent that is more meritorious in existing structures, the demand has surely outstripped the supply. 
 
Even the best talent in the existing market might not prove to be the right fit for the startup culture. Therefore, the need to always know how potential employees are likely to respond in ambiguous situations will help startups get better insights on potential talent, especially at senior levels. 
 
The Art of Pausing 
 
To refrain from creating an identity that is synonymous with firing, startups must pause and reflect on developing a recruiting culture that enables them to hire the right talent for the right role. Startups must focus on the opportunities and work experience that it offers to create a strong employer brand. In addition, also state clearly and upfront what it takes to work in a setup. Such an approach would anchor hiring of talent that is best fit for the organization. 
 
Establish a Cadence 
 
The mantra for success lies in developing a cadence, where founders need to put on their thinking hats and craft innovative hiring techniques to anchor the next evolution of HR as a true business partner. A way for startup organizations to build is by providing ample learning opportunities. Founders must put extra emphasis on creating and justifying the employee promise, by not only giving the opportunity to grow vertically, but also laterally across the organization. 
 
At the same time, startups must deploy mechanisms that reward superior contributions and capability suitably. Performance management systems must be developed to answer and equally emphasize on the question of “how” and not only “how much?” 
 
Plan the Exit 
 
Despite all this there will be situations when organizations need to take the tough call of asking someone to leave. There must be a defined exit strategy put into place before it is done. Lest it leads to a situation similar to the one that occurred recently at a startup office, when angry employees resorted to arm-twisting strategies against the founders for not paying their severance packages. Even if the much dreaded route needs to be taken, organizations must be sensitive enough to give a prior notice to its employees and resort to monetary compensations and any other assistance that fits the bill. 
 
The bottom line being –startups must create a diligent recruiting culture and sustain it by innovating on all stages of the employee cycle. 
 
(The article is authored by Nitin Sethi, Partner, Aon Hewitt and Aakriti Ahuja, Associate Consultant, Aon Hewitt) 
 
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ImagineeringTomorrow: Critical re-thinking about the future of work is necessary. Here's why

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ImagineeringTomorrow: The Talent Network

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ImagineeringTomorrow: To the ballet class

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Impact of Demonetization on Employee Benefit liabilities & Exempt Provident Fund Trusts

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The business of HR

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The Business of HR

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Here are stages and perspectives behind running family businesses in India

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Important advice for startups: Layoff but don’t put off your talent

Aon Hewitt