Thursday, December 08, 2011

Are we in the right jobs?

If one were to go by the above graph, and the fact the US unemployment rate fell last month to its lowest level in more than 2 and half years, as employers stepped up hiring would mean good news right?

More than ever, it is time for all of us to read in between the lines as things aren't as they appear to be -on first impressions! As a person who strongly believes that we are 'truly global professionals' being affected by events that are very much out of our immediate control, we can do a lot by keep ourselves abreast about the larger trends!!

Here is a perspective -even as Citibank announced lay of 4500 people..less than 24 hours back. While it is still less than 2% of their total employee base, it is interesting to note the company was taking about improving efficiencies!!

Lessons for us to take away?

Technology, globalisation, innovations...are all impacting the nature of jobs that are presently being offered.

Companies are increasingly cherry picking their talent.

- What is the ROI we as employees-are providing to our employers? 

- Does my job increase the revenue for the business?

- If my job is part of the 'overhead expenses' of the company, what am I doing to be 'counted'?

- Am I picking up new skills personally-at a rate faster than the rate at which 'the world is seeming to change'?

-How close am I to my level of 'incompetence'? 

- Is my contribution indispensable? 

Hard questions -but better be asked..than ignored.

Here is another graph  that would be relevant for us to remember. Yes, news jobs are being announced. Are the old jobs coming back? And more importantly, at a rate that we want?

All of the recessions are compared from their start date, with each line looking at the collapse in unemployment and subsequent recovery.
In almost all recoveries, the jobs situation has been v-shaped, with jobs coming back quickly once the recession ended.
That started to change with the 2001 recession: It took a long time for all the jobs to return.
And now we're in the worst jobs slump ever, with the recovery not looking very v-shaped at all.

Are we in the right jobs?

Saturday, December 03, 2011

Job hunting & Social Media

The interesting info graphics -courtesy the Jobvite Social Recruiting Survey 2011 provides an interesting insight into the following trends

-As competition for talent intensifies, social recruiting is on the rise.

-Only 16% will spend more on job boards-and one third of the respondents plan to spend less on job portals, third party recruiters & search firms.

-One third of the companies expect the average new employee to spend less than 2yrs : and so expect to intensify recruiting efforts!

While there is a significant shift in the power of choice- that is increasingly now in the favour of the employee, is it not a wake up alarm for all?

Companies - time to look beyond just filling in the seats?

Candidates - time to take charge of their careers -a la CEO mindset?

Consultants -time to look beyond transactions, and concentrate on adding value as talent advisors, career management professionals...?

Or is it just another fancy many others we have seen in the past?

Food for thought... are some info graphics...that triggered it all !
Investment Growth in Recruiting Sources

Created by: MBA Online

Monday, November 28, 2011

Visas : Vista for Talent Attraction & Engagement?

Would you believe it? US visas could perhaps also be used for talent attraction & talent engagement for employment in India as well:)!?

Well, most of are aware H1-B is essentially a non immigrant visa in the US used to employ temporary foreign workers in specialty occupations.

Over the years, and more so in the past couple of decades, it has been regulated as a measure of increasing /decreasing the supply of talent of foreigners in the US-and has probably contributed a lot of the fortunes of the off shoring/outsourcing industry in India.

In fact till the mid nineties one wasn't even aware that there was a cap on the number of visas granted -which then was 60,000 annually -and was periodically increased -and at one time peaking at 200,000 when the scare of Y2k was its highest-after which the old level has been restored.

In the recent past, there is a definite increasing trend for the demand of work visas in US- as we regularly see that the quota is used up in hardly a couple of months. The H1B is usually for 3yrs -and extendable for another 3yrs-as a routine. Some employers, in the better days, would even sponsor the green card application-which meant that the 'alien ' would become a citizen over a period of 6-10yrs in US!

-Considering the global slowdown, and the high unemployment rates prevalent in the US -we haven't seen many companies willing to hire non-citizens, and as a consequence, there is a large number of H1-B professionals-who stay has to come to an end-within 6yrs of their stay in the US. And this segment- is an attractive bunch of well qualified and appropriately experienced- talent that the Indian/MNCs in India-especially the R&D centres -have been eyeing. 

(Psst : Should you know of any MS with 5-6yrs exp in the US-be it Scientists, R&D engineers, or analysts, and planning to relocate back to India within the next 2-12months, please let me know. We have multiple openings with MNC clients in Pharma/ Automotive/  Healthcare/ CROs/ KPOs -who wouldd be keen to explore hiring such talent!!)

- Smaller ITES companies in India have been using it as a carrot to attract/retain potential employees in India- with a possible long term on site assignment in the US. And considering that the time taken ( the applications are accepted by the authorities in April every year-while they are processed only from October onwards!)  for  visa processing could hold back the potential employee from 6months to -say 12months-it means an opportunity to engage an exciting prospect for longer tenure & thus battling and even postponing attrition!!

Interesting? Please feel free to correct my impressions....

Saturday, November 26, 2011

Job Surveys in India : Sombre in Short term

It is that part of the year-when the Indian industry-wakes up after the festival euphoria ( for most businesses, Diwali time is a pretty big season, and for the employees a great reason for bonuses/ appraisals!)-and tries to take stock of -the impending future!

The latest Business Outlook magazine predicts the returns of the pink slips in India!!

The graphic compares the figures by Ma Foi Ranstaad survey -is self explanatory. 

The article also lists out a rather uncomfortable run down of some of the big names -across different industries-that have either announced recent lay-offs globally and some in India.

Not to mention the sense of uncertainty-that fuels the rumours of a possible recruitment freeze in the coming couple of quarters!

Interestingly, the  traditional 'old economy'  manufacturing industry seems to be the only growing sector -as most others 'hitherto' fast growing employers -especially in the real estate, Energy and BFSI seem to have hit speed breakers!

Education, Training & Consultancy, as well as Health care & hospitality -being touted as the 'recession proof' domains-together contribute to a fair amount ! 

Personally I feel the overall global sentiments have percolated to most sectors within the country too. Most companies have tightened their belts-and have laid off 'non performers' over the last couple of years, and most importantly, haven't felt the need for 'back-filling' the jobs.

And focussing on keeping overall costs down, most companies have resorted to a variety of different modes :

-adopt a wait -and -watch policy and see how the economic situation plays out.

-a  'need based' and very selective senior-executive hires.

- reduce the ratio of support roles as compared to revenue-generating roles

-increasing the employability of the talent rather than hiring for doing a job!

-outsourcing the non- core roles in the support functions

-increasing the ratio of 'temporary staffing' to that on permanent roles until they are sure of the value add is imminent!

-- a change in the hiring strategy and increasing their ratio of campus hiring. Interestingly, the starting salaries of the freshers from campus-hasn't changed since the last couple of years.

-hiring 3-4 junior level independent contributors instead of hiring a manager

It is all happening right?

What worries me is that the domestic Indian growth story has been also hampered -due to the increasing interest rates. One has lost count..but I trust there have been atleast 13-14 hikes in the RBI repo rate -since March 2010. And add to the inflationary trends that the increase in petrol prices ..contributing very aggressively, it could turn into a 'catch 22' situation if the industrial/manfacturing sector would be affected!!
(Unless ofcourse the fall in the rupee motivates the industry to export more..and hope the dollar remittances would compensate??)

On the flip side- the tough times will certainly bring out the best in all...and who knows, the long term growth story may well be nearer !!

I would love to have your impressions...

Thursday, November 24, 2011

Jobs in India- Emerging global hub for 'invisible' innovation

It is a little uncanny that my last post -which was about 4 weeks ago-had also featured Thomas Friedman.

This time, it is triggered by the book  India Inside:By Nirmalya Kumar & Phanish Puranam as they presented the same at ISB, Hyderabad earlier this evening-which they admit was inspired by Tom Friedman's book "The World is Flat"-which alluded that innovation will continue to keep the West economically supreme, with the "more sophisticated tasks being done in the developed world, and the less sophisticated tasks in the developing world-where each has its comparative advantage".

The authors pointed that much of the substantial innovation that took place- has been invisible, and went on to dwell on the research with some of  "R&D work done in India-but for the global customers"-has been world class-and is poised to grow to a next level!

I personally was intrigued to be enlightened to the concept of the 'sinking skill ladder' that they elaborated!

What is a skill ladder? The idea that to do highly sophisticated innovative work, you need to have done less sophisticated work at some stage in your career. Imagine being the partner at a consulting firm without having been an associate, an investment banker without having been an analyst or the head of a clinical research team without having done any “bench-work.”
The work that the juniors do in each of these cases may be fully separable from the work that the seniors do; indeed the junior could be somebody sitting in India. However, in each of these cases, the seniors will continue to have a deep understanding of what exactly the juniors do because they have been juniors themselves at an earlier stage of their careers. Without such knowledge, arguably the seniors could not do their own jobs effectively.
A problem lies ahead: Western companies are blocking their talent pipelines. Without that route, how will tomorrow’s senior leaders emerge? Unless they have grappled with this question, it seems facile to say that companies in the West can “move up into higher-value-added services” and leave the “low end” work to their counterparts in Asia.
In some sense, the problem for managers of companies from the developed world is less complicated: they can move the next rung of their R&D, and even their headquarters, to where it can be done more effectively and efficiently. However, disconcerting questions for policy makers in developed countries will remain.
My take away on the implications of the kind of jobs that will be on offer in India!!?
1. There are over 600 global R&D Centres of MNCs in India- that are already following the delivery model where innovative and creative tasks are increasingly being off shored to India. And these have been across different industry domains- automotive, telecom, medical devices, pharmaceuticals, ...
2. MNCs are transforming composition of their global leadership teams as R&D and markets move to the East.
(The HBR abstract of the article is a must read!)
3. The increasing opportunities are more Indian IT services companies invest in building their specific practices -to provide 'outsourced product development' to smaller companies in the West
4. The growing Eco-system in the start up ecosystem-is enticing some of the 'experienced' professionals to embark on entrepreneurial ventures...
For specific opportunities, please feel free to reach me out offline !

Sunday, October 30, 2011

Flat World 2.0 : Time to find our 'extra' ?

Last night I had the opportunity to watch the 76 minute video - Thomas Friedman's lecture at Linkedin -on his latest book. It is actually a 35 minute talk-and followed by 40 minutes of Q&A. (Courtesy : the Linkedin Blog)

The  Master story teller summed up the change since the time he wrote his earlier book in 2004

When I said the world is flat, Facebook didn’t exist. Or for most people it didn’t exist.  Twitter was a sound.  The Cloud was in the sky. 4G was a parking place. LinkedIn was a prison. Applications were something you sent to college. And, for most people, Skype was a typo.

That all happened in the last seven years. And what it has done is taken the world from connected to hyper-connected. And that’s been a huge opportunity and a huge challenge.

To me, the takeaways from the lecture-was the description of the effect on the labour market or jobs-as we have moved away from just a 'connected world' to the 'hyperconnected' world!

Thanks to the combination of globalisation and IT revolution, he observed

- the 'routine work' -ie the ones that can be described by an algorithm -has been crushed. Several jobs simply don't exist any more!

-the game has risen for the 'non routine work'-the ones that call for critical reasoning & problem solving.

So much so -that every individual has to have a unique value creation proposition!

His mantra for us to take charge of our own career?

-  the need for each of us to have an internal OODA – Observe, Orient, Decide, Act – loop that is faster than that of our competition.
 -The critical importance of realizing that “average is over”; and, also that the economy of the future will reward individuals who deliver “extra” in their roles and “invent, re-invent, and re-engineer” the way they drive value out of their jobs
Well, are we preparing ourselves for the New World? 

Thursday, October 27, 2011

Relocating to India: More a mindset!

For those of you -who haven't been following the thoughts shared by Brijesh Nair, who has been blogging very prolifically for years now, before and after returning to India-and settling down in Vellore-here is an interesting debate that he introduces us to!!

After I wrote “Read This if You Have Plans to Relocate to India from US Ever” I came across two articles – one written by Sumedh Mungee in New York Times and a reply to that by famous Indian writer Chetan Bhagat - that underlines what I wrote in my blog about "mindset" that is essential for those who are relocating to India. In the first article, Sumedh narrates why he could not adjust his life in India after his return from US and his reasons to return back to US in less than 3 years. Chetan Bhagat in this article recounts his experiences once he relocated to India and how he made India a better place to live for him and his family.
Here are few excerpts from the article of Sumedh Mungee
…after being away for eleven years (I grew up in Mumbai), I was prepared for Indiato feel less like home and more like the flight’s “Indian vegetarian meal”: visually familiar but viscerally alien.
Our daughter attended a preschool in Bangalore whose quality matched any in the Bay Area. Our three-bedroom flat in Defence Colony, Indiranagar, was so comfortable and so American-friendly that my friends called it the Green Zone.
Three months after our return, after a friend told me that his two children were sick with amoebiasis — he thought they got it from their maid — my wife and I designated a separate set of dinnerware for our maids. It’s more hygienic.
Within six months, I’d brusquely refused my driver an emergency loan of 500 rupees ($10) to attend his grandmother’s funeral. I’d learned my lesson after our previous driver scammed me into paying for his son’s broken leg (as it turned out, he had no son). It only encourages them to ask for more; besides, they’re all liars.
What does this tells you after reading all these? The author had the “mindset” of an American and is not ready to give up that “mindset” even after relocating to India. His mindset wanted everything American in India and failed miserably and has to go back to US.
Now some excerpts from Chetan Bhagat’s article
We had another set of two maids. One of them is another young girl, around 20 years old from a village in Ratnagiri. I told her she has to learn something. She chose English and found a set of classes near the house. Everyone opposed me again. I told her to go ahead anyway. She has joined classes. She has not run away. This morning she said to me in slow but perfect English “Bhaiya, would you like your breakfast”, smiled and I felt it was worth it.
In my house, nobody is allowed to call the maids servants. We call them helpers, the kids call them ‘Didi's’. There is no question of separate cutlery. They eat what we eat, and are paid enough that they can afford good clothes, soap and shampoo that the hygiene standards are at par with us.
My elder maid has kids in Bangalore. Every summer, we call them to our house to live with us. They play with my kids, with their toys. When we go to Bangalore, my kids spend a day in her house. They haven’t fallen sick because of it. Whenever she wants leave, if it is reasonable, we send her home. Every week, both maids have a day off. Every Diwali, we give them a bonus and a raise, given the high inflation rates. This year, I had a new book which did well, hence the bonus will be bigger.
Now Chetan Bhagat came back to India from Hong Kong with the “mindset” to live like an Indian in India and also to put into practice some good things he learned abroad. One needs to have a “mindset” like Chetan Bhagat if you have to successfully relocate to India. Otherwise you will be like Sumedh Mungee and in no time will be in an Indian airport to catch a flight back to US.

So what are your thoughts after reading both the articles?
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Wednesday, October 26, 2011

5 things returning NRIs should know about salaries in India

Here is the second part of the article by Deepa Venkatraghvan who blogs on Economic Times.

In the previous article we saw what kind of salaries NRIs returning to India from the US could expect. Broadly, you could expect 40-70% of your US salary as your salary in India. The next step is to understand what exactly salary means.

Salaries in India are quoted in terms of CTC or cost to company. CTC is nothing but the cost that the company incurs to employ you and keep you employed. It includes your pay and anything else that the company may incur to keep you in employment. It's important because a lot of components of your CTC may not translate into actual take-home cash every month. Says Kris Lakshmikanth, Founder CEO of The Head Hunters India Pvt Ltd, "As a broad thumb rule, what you get in hand will be 70% of your CTC. So if your annual CTC is Rs 50 lakh, you can expect to get an annual take home of 35 lakh or Rs 2.9 lakh per month."

So what happens to the difference? That's one question we will try to answer today. The next is, there are many components that are offered in addition to the CTC, ESOPs being a good case in point. So what are the things you need to look at there? Let's take a look.

1. Certain components of CTC may not be cash components

A company may beef-up your CTC with components that don't really translate into month-end cash or that may have just a notional components. Some examples include:

-Value of perquisites is included in CTC. So if you are provided with a company accommodation, car, driver, child education expenses and so on, the value of these get included in the CTC.

-Banks may include interest subsidies in CTC. That is, if you are a bank employee, you are entitled to a discounted rate on loans. The difference between the market rate and the discounted rate maybe considered part of your CTC. Even corporate give out loans and advances at subsidized interest rates and the subsidy would be added to the CTC.

-Companies may include the cost of group medical or life insurance. Some companies may add food subsidies, that is, you may be getting a subsidy on your lunch in the office canteen. If you carry your lunch from home, you may not actually benefit from this component. Similarly, if the company provides transport, there maybe transport costs or subsidies.

-Companies include gratuity in the CTC. Gratuity is a sort of bonus that is paid out when you resign or retire from your company. The catch: You are entitled to gratuity only after completing 5 years in the company.

-Employer's contribution to your provident fund is included in CTC. This amount is deposited by the employer in your provident fund and so this does not form part of your take-home. You will get this amount only at the time you resign or retire.

"Ask to see the cash-in-hand figure. That will give you a good idea of what you will get," advises Aseem Juneja, Country Manager - India at US based executive search firm ZRG Partners.

2. Deductions further reduce monthly take home

Even after you have arrived at the cash value of your take home, there are certain deductions made from it. Tax is one such deduction. It is nothing but the taxes withheld from your income by the company. It is the equivalent of 'withholding tax' that several countries have. How much tax is deducted depends on the various components of your salary. This guide should help you understand.

In addition to income tax deduction, you will find a professional tax deduction being made every month.

"A lot of companies may allow you to choose the components in your salary. For instance, they may allocate a certain amount as a 'flexi pay' component. Within this amount, you maybe able to choose components such as HRA, medical reimbursement, etc depending on what maybe most tax efficient for you. If you are in a higher income bracket, it would be wise to consult a professional to help you optimize your salary to make it tax effective," advises Lakshmikanth.

The other deduction is your contribution to provident fund. This amount is deducted from your monthly salary and deposited in the provident fund. This is your contribution and comes out of your monthly salary, thus reducing your take-home. Again, a lot of companies make this deduction optional. However, making provident fund contributions maybe a wise saving tool. Currently company provident funds earn tax free returns of 8.5% per annum. Over a long period of time, that would build up to a decent corpus.

3. Annualised and variable components

There are certain components that are paid out to you annually or subject to your performance; these do not become part of your monthly take home. Examples include leave travel allowance, annual bonus etc.

"Variable salaries can range between 15-50%," Lakshmikanth says, adding, "For programmers the variable pay would be around 15% of the CTC while for marketing professionals it could go up to 50%. Before the 2008 crisis, most companies paid out the variable components in full, but that has changed now. There are various factors that come into play while arriving at the variable pay outs. The company's performance as well as your individual performance would both matter."

4. Understand what your ESOP consists of

Employee Stock Option Plans or ESOPs are given out over and above the CTC. The company gives employees an option to purchase stocks at a certain future date at a discounted price. As the value of the company scrip increases, the employee stands to earn capital gains. "When a company offers ESOPs, the CTC part of the compensation maybe a little lower," Lakshmikanth explains.

While ESOPs might seem attractive when the company HR presents the numbers to you, it is important to look into the fine print. Says Juneja, "There are a number of issues here. Firstly, people do not realize that there is a certain vesting period for ESOPs. That is, you will be eligible to exercise the ESOP only after working in the company for a certain period, say 2 years or so. The second issue is the strike price. This is the price at which the ESOP is granted. If the market price at the time of exercising the ESOP is lower than the strike price, there is really no gain. And that has happened many times in the past."

So is there room for negotiation? "There is always a 10% room for negotiation in any component of your salary," Juneja says adding, "So you might ask the employer to reduce the variable component by 10% or the value of ESOPs by 10% and increase the cash component by 10%. It's worth giving a shot."

5. Don't forget to negotiate a relocation package

"It's very common for senior executives to forget to negotiate a relocation package," says Juneja. "Relocating to another country, even if it is India, especially with a family in tow can be an expensive affair. You might get a few weeks of accommodation. Sometimes that time may not be enough. So negotiate a package before-hand. For instance, make sure the relocation package includes important things like getting a real estate agent through the company. That way, the likelihood of bumping into rogue agents is less," he adds.

(The author is a chartered accountant and financial writer. She also blogs at blogs.economictimes )

Thursday, September 29, 2011

Moving from the US to India: Expectations of salary

Here is an article that appeared in Economic Times by Deepa Venkatraghvan today :NRIs moving from the US to India: How much salary to expect?

Here is the full article..there are a couple of my quotes :)!

Madhuri Dixit to return to India, bag, baggage and doc in tow'

That story probably made news only because of its star power. The fact that NRIs from the US are moving back to India is no shocking development. NRIs have, in the last few years, been relocating to India in large numbers, in search of better personal and professional lives. And if you are an NRI considering that move, there is one important thing that you must understand very well: the salary you will get in India.

Kris Lakshmikanth, Founder CEO of The Head Hunters India Pvt Ltd. says, "When it comes to compensation, we find that NRIs have inflated expectations. They mainly go by hearsay; their friend or friend's friend who returned to India has told them a tall story about Indian salaries. They want to go by that yard stick."

USD will not convert to INR

The first thing to remember is that you will not make the rupee equivalent of your US salary in India. The cost of living in India is significantly lower than that in the US. This also means a lower labour cost in India. These factors will determine your India salary. Seema Nair, Co-Leader India HR Operations of Cisco Indiaexplains, "The salary in India (for Cisco employees moving from US to India) is related to local labour market wage rates with a potential premium for critical skill sets."

Achyut Menon, head of Options Executive Search Pvt Ltd also adds, "In the nineties, people who were posted to India got expat salaries. But those days are over. In the last 10 years, India has become an attractive market for global companies who are not just looking to set up offshore centers here, but also to capitalize on the growing, educated and highly aspirational middle class consumer segment. Added to that is the availability of skilled labour within India itself. Companies no longer need to pay expat salaries." Benchmark: What then should be the broad benchmark? Both Lakshmikanth and Menon say that while there cannot be a standard formula, the Big Mac Index is a good guideline to calculate salaries. The Big Mac index published by The Economist, is based on the theory of purchasing-power parity (PPP), according to which exchange rates should adjust to equalise the price of a basket of goods and services around the world. The basket in this case being a McDonald's Big Mac.

Now according to the last available index dated July 2011, a Big Mac costing USD 4.07 in the US costs USD 1.89 in dollar terms in India (Rs 85 converted at an exchange rate of Rs 45). It means that the Big Mac costs 54% less in India; the cost of living is 54% lower in India. Read another way, this means that the rupee is undervalued by 54% to the dollar and that on the basis of PPP, one dollar would actually be worth Rs 21 instead of Rs 45.

So if you are drawing a salary of USD 100,000 in the US, you can expect to draw Rs 21 lakh in India, give or take. At an exchange rate of Rs 45, that would translate to an Indian salary of USD 46,666 or 46% of the US salary.

"Senior management can expect anywhere between 40% and 70% of their last drawn US salary when they move to India," Menon explains, adding, "At the 70% end would be people who have moved to India to set up a development/ engineering center or to head the global company's India start-up."

Best career move

Having set that broad benchmark, the salary would also vary between industries and functions. You would need to choose your profile and company carefully to maximise your salary.

"Manufacturing would pay less than technology. Within technology, we find that delivery of software is something which Indian companies have become masters in. They don't need to employ people from overseas. In fact, such people from the US are paid less than the person who stayed back in India because those returning from the US have handled fewer people teams as compared to peers in India," Lakshmikanth points out.

Similarly, domestic Indian companies do not usually recruit NRIs for strategic positions if the NRIs are not familiar with the dynamics of the Indian market and work place.

As an NRI moving back to India, Menon says it would be best to join a company in the US which has plans to start-up/ expand in India. "A lot of US companies across sectors like engineering, legal, analytics, financial services, pharmaceuticals are setting up operations in India. These companies are happy to send an Indian to India who also has experience of their other markets. The employee benefits because he can grow with the company's operations in India. In the beginning, the company will set up a 30-40 staff office and expand going forward. As a member of the start-up, the employee grows as the company grows, making it a win-win for both" he explains.

Parting shot

"At the end of the day, come back to India for the same reasons you went abroad: for personal and professional growth and happiness. Come with a long term view in mind and you won't regret it," Menon advices.

I can already see some instant feedback in the comments section at the end of the main article. Am open to having your observations here too!!