Retention and recruitment during economic downturns

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This isnt an academic treatise of the subject but is focused on experiential approaches to tackling the needs of retention and recruitment during periods of uncertainty. I have used 'caselets' to drive home some of the points, and have avoided generating exhaustive to do lists.

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Retention and recruitment during economic downturns

  1. 1. MANAGING HUMAN RESOURCESDURING AN ECONOMIC SLOWDOWN Anilesh Seth Co-founder KROW Ex MD: SUPERVALU, LG Soft India anileshseth@hotmail.com
  2. 2. Agenda• Today is very different from yesterday• To dos• Caselets
  3. 3. Today is very different from yesterday…….. In the backdrop of economic uncertainty: Cost of skills is rising Prospective employees are choosy!! Global roles means global competition Skills required are constantly evolving RIF is standard terminology Mismatch between people losing jobs and your needs
  4. 4. The Employer’s view….• Shift to Just-for-time• Flexibility in terms of time/days/location• Role versatility• Adaptability to change• Flatter structures
  5. 5. The Employee’s view….• Work-and-life balance• Growth opportunities, recognition• Transparency• Learning/training: Focus is on “employability”
  6. 6. The New Relationship The new relationship is one of partneringfor a mutually agreed outcome/timeline…..
  7. 7. To dos…recruitment• Word of mouth spreads very fast – especially given social media• Risk of “reneges” is very high during periods of uncertainty• Use your referrers as an additional channel to keep the prospects “warm”
  8. 8. To dos…retention
  9. 9. Tech start up• Looking for a sales head and • Sourcing: pure play product architect networking based. Risk of• Unable to pay competitive renege may be too high with a salaries head hunter…and expensive• Not sure where to find • Understand motivation• Folks unwilling to take the • Understand needs plunge during a recession • Compensation will need to be creative: comp, stock, sweat equity, deferred comp, profit share in future etc • Founders’ vision and passion will be key in selling • Engage before he/she comes on board
  10. 10. Shutting part of the business• Unprofitable part of the business to • Use an HR firm to help with the specs be shut down and shortlisting• Some of the amount saved will be • Ensure clear and consistent used to hire other key folks - online messaging about the reasons for marketing/social media shutting down some offices and the strategist/content future prospects of the company• Problem of hiring while letting • The HR firm as well as your own others go at the same time…..will be interviewers must be well-versed perceived as risky with these messages• Not sure where to source the new • The fact that you are making hires from….specs are not clear investments during a recession is a• Need to keep the existing business positive motivated • Use outplacement services to assist the team that is being let go • Tie up with a counseling service • Craft an ongoing communications strategy for your existing business
  11. 11. Budgetary cuts• Reduced or no annual hikes • Use established industry• RIF benchmarking to assist with the• Benefits reduction messaging• Still need to hire some key roles • Cascaded, consistent communication followed by an open house to address questions about the company’s future • Enlist outplacement & counseling agencies to assist with the RIF • Caution about removing benefits like insurance and transportation • Evaluate your training budgets carefully. Key training programs should continue • Negotiate with your vendors • Keep engaged with the new hires till they come on board
  12. 12. Hiring in a downturn• Large MNC wants to hire a • Good idea to use an handful of key roles, established head-hunter to confidentially source people and to do the• Best place is to hire from a first “sale” on your behalf competitor • Consider offering a basket• The downturn is going to of benefits that include make it difficult to hire opportunities, future away...budgets are not comp/rewards, a higher unlimited role.....”doubling” compensation is not necessarily the best way • Engage the candidate till he/she joins • Have a backup plan
  13. 13. Preparing to sell the company• Owners of the company have decided to exit • Confidentiality is key at this stage the business and are planning to engage a • Need to bring on board the key leaders – firm to help find a buyer some of who may be impacted. This is a• The buyer will want to keep existing potential source of leaks customers and key team members, and will • Have an open conversation with them. Put in want to minimize the loss of these place attractive time-bound/outcome based retention plans • Have a strategy to handle rumors in the market with a single point of contact to address queries • Monitor the pulse – if rumors are getting large, you need a strategy to handle expectations within the company without being dishonest. • Have a contingency plan in place in the event of a leak • Leverage the commitment and trust of your key leaders to create a communication and change management plan
  14. 14. Acquiring a loss making company• Loss making organization being by another • Pre-identify the key team members. Consider one seeking market share retention incentives• To derive operational efficiencies there will • Clear and consistent communications be a reduction in force strategy….open and honest Q & A sessions• The need is to ensure that key team • Keep a single face for the external world to members do not leave ensure consistent messaging • Ensure that the existing team understands how the acquisition is going to benefit the company and them • Identify new key roles required in the new organization – evaluate possibilities of acquiring team members taking some of these key positions • Craft a well-thought through change management-cum-mentoring strategy. This is a change for both the acquired as well as the acquiring
  15. 15. Key points• Timely and honest communication• Cascaded and consistent communication• Remember, even if you are not, the outside world is talking• “Internal job postings” and “open positions” can be a potent weapon• Don’t allow “bench time” to be idle time• The associate holds the important cards….think from his/her perspective

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