Talent Management During a Slowdown By Mr. Ranjan Sinha

Talent Management During a Slowdown

By Mr. Ranjan Sinha
In the last twenty-three years of my professional career I have been through 4 slowdowns/recessions and at least two economic booms. You never manage just a downturn, organizations need to manage business cycles. No downturn is forever and no boom is permanent. It requires understanding external market uncertainty and internally managing a talent pool that is anxious and perhaps distracted because of the uncertainty. It demands better anticipation and execution at all levels just like from a pilot that hits a bad turbulence. If you have been a passenger in one these turbulences a few times, your palms may be sweaty, but you know it will pass. For the first timer it may appear like the end.
What I have learnt is, the best way to predict the future is to create it…i.e. manage it. It all starts with our ability as business leaders and managers to forecast and develop a crystal ball that will tell us and our organizations how deep the recession/slowdown is, how long will it last, which business units will be impacted more than others, what opportunities will it open up and what threats it will create for the company. HR Managers need to then link the investment adjustments and revenue forecast to workforce planning.
Communication and Managing Morale of Employees: Slowdown demands improved productivity to maintain growth with lower costs. Managing morale becomes critical during these times. Even if your company is not looking at a significant slowdown in hiring or planning layoffs, perhaps because of better planning, your employees are hearing the L (Layoffs) word and are anxious. Communication needs to be realistic and honest, based on adequate planning, about the business outlook. Companies need to share their approach to weather the downturn, reaffirm their commitment to the best performers and seek their support and commitment. This will provide confidence to your employees. HR needs to focus on its frontline managers. Many managers in India, especially those managing the frontline employees, have not seen a tough economic cycle and need coaching to help them effectively communicate, manage and garner productivity from an anxious and distracted workforce. Honesty is key because too many changes and knee jerk reaction is the best way to lose the confidence of your team and organization. Passengers want to believe the captain knows what he/she is doing else they will panic.
Poorly run companies “binge” hire people when the going is good and layoff when times are bad. How you treat your employees thru a tough time will not only shape your talent brand but will send a message to your current - whether you treat them as true assets and people you are willing to share the pain with or as dispensable fodder in the war for talent. You will lose your best talent as they will seek more secure companies and struggle to hire when the economic cycle takes off again.

Cherry Picking Economic down cycles are the perfect time to bolster you talent pool. The talent pool is deep and the salary pressures are less. I know of companies that increase their campus hiring from the top schools as they are able to attract talent they could not in a boom cycle, at wages they can now afford. Such hires, hopefully, will feed the pool for future managers and leaders.
Change Processes
Once you recognize that business is cyclical, companies need to transfer their recruitment infrastructure, people and processes from a fixed cost structure to a variable outsourced cost model. Many of the best-run global companies have adopted RPO (Recruitment Process Outsourcing) during economic slowdown. The slowdown gives HR an opportunity to step back and retool. It provides the pace to deliberate, plan, select a vendor and orchestrate an effective seamless transition.
My crystal ball says that India will be relatively less impacted by the global slowdown as domestic consumption and 8% of their GDP dependant drives 60% of its GDP on BPO/IT sector. India will continue to churn out 3 million-college graduates per year. Companies should brace themselves for a barrage of resumes because there will be more people looking for jobs. HR will be expected to manage with less recruiter, and the productivity demands on recruiters and HR will be higher. You still cannot afford to hire the wrong person, as they are most likely not going to leave until the economy starts growing again. Companies need to aggressively adopt psychometric assessment technology to manage risk and cost of hiring decisions.
Growth of companies is and will be constrained by availability of high quality talent. The men will be separated from the boys by their ability (or lack thereof) of their HR leadership to comprehend the business cycle and the counter cyclical opportunities it provides to create a brand of “full retention” and attract the best talent for long term competitive advantage. ________________________________________________________________________