From the tree’s roots Dear Readers, As we step into the second successful year of our existence, it gives us immense pleasure in welcoming you to read our third exciting edition. In this issue, we have tried to focus on some key areas in HR such as Talent Acquisition, Talent Management, Employee Engagement, HR Transformation and HR Challenges. We have also tried to reiterate the importance of the much talked about, but least worked upon aspect of “Work-Life Balance”. We express our heartfelt gratitude to Ms. Barsha Chakraborty, AVP, Human Resources, G-Cube Solutions,Mr. S.Padmanabhan, Director HR, Dr.Reddy’s Laboratories, Mr. Aloke Tagore, Regional HR Head - East ,Deloitte Touche Tohmatsu India Pvt. Ltd and Ms. Linda Johansson, Global Sustainability Coordinator, H&M, for their valuable time and insights. We take this opportunity to congratulate all the winners of “The People Tree Article Writing” competition. We would be delighted to have your valuable suggestions and feedback. Please feel free to write to us at thepeopletree.mhrm.iitkgp@gmail.com . Happy Reading!!! Editing Team
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HR CHALLENGES
The HR Challenges in SMEs By N.N Subburam Amrita School of Business
The Small and Medium Enterprises (SMEs) in India have performed substantially well and enabled the country to achieve huge industrial growth and diversification. Today SMEs have become a dynamic, vibrant and vital sector for the growth of the Indian economy and it contributes around 45 % of industrial output, 40% of exports, 42 million in employment, create one million jobs every year and produces more than 8000 quality products for the Indian and international markets. The growth opportunities for the SMEs in India look impressive but there are numerous challenges they face every day and the most crucial challenge they face is in the Human Resource Department. In this highly competitive and constantly changing business scenario the most valuable resources that need to be leveraged is the Human Resources. Traditional organizations distinguished them from the competitors by their products, services or even processes.
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HR CHALLENGES But today, these are no more considered as competitive advantage because they can be easily emulated. Building and retaining a passionate workforce which is committed to the organization, ready to take up numerous challenges, willing to run the extra-mile is very difficult. The role of HR does not end just at attracting and retaining the best of the best employees available in the industry. Motivating them, engaging them to the strategic goals of the organization and making them fit to the organizational culture are important issues which create nightmares to business leaders, top management and HR professionals. This article would mainly focus on the challenges faced by SMEs in Recruitment Retention and Employer Branding Challenges in Recruitment Employees in an organization are the most essential growth drivers. Finding out the right candidate is highly challenging for SMEs because they are not adept in modern methods of hiring and find it difficult to locate the best talent available in the industry. Most of the SMEs do not provide a clear job description as most of the large companies do. So candidates applying in SMEs do not have a clear picture of the job which they are applying for. Top talent comes always at premium price, and if the pay packages are not attractive then they would be lost to the competitors. In India many SMEs in Tier B, Tier C cities are not aware of the modern techniques of recruitment such as online recruitment or E-Recruitment, boomerang recruitment, social media recruitment and mobile recruitment. They still follow traditional way of recruitment such as newspaper Ads, employment agency or search firms. The roles and responsibilities of the candidates are not clearly formed in most of SMEs and at the fresher level most candidates accept it and crib later, which leads to high attrition.
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HR CHALLENGES Solutions for Recruitment issues SMEs should adopt new recruitment methods. They should implement effective hiring channels such as employee referrals, graduate recruitment and so on. SMEs can maintain an active database of the candidates who have applied earlier and during vacancies, the companies can retrieve them according to the requirements and reduce the search cost and time. Proper job analysis should be done and detailed job description should be provided to the candidates. It should be kept as a tool for measuring the traits of the candidates. Retention Executives are extremely worried how to retain their key people in the organization and make their alliances continual. Companies should strive to know the reasons for attrition in SMEs and the factors leading to attrition should be identified, analyzed and measures should be taken to reduce attrition. There are several factors which lead to the departure of the people such as Unfriendly manager-employee relationship Bad working conditions Nature of the job No job security Improper work/life balance Less opportunity for growth and advancement If these factors are analyzed beforehand, the HR related issues can be reduced. Employer Branding In the corporate ecosystem, employer branding is gaining tremendous momentum and because of this, SMEs are finding difficult to attract and retain the talent. Earlier, employer branding was not considered seriously by many organizations. But today it’s crucial because of the economic climate in India, where businesses experience heavy pressure to cut costs and increase productivity. Getting the right people with right skills, attitude, knowledge and experience to drive the business is strategically important. Developing an employer brand will help SMEs to attract the best talent and building an image in the minds of employees as a “great place to work” would reduce the time and money spent on quest for talent. These are the few typical HR challenges that SMEs face and they should overcome these obstacles through a well-thought process and realistic plan. SMEs should collaborate and channelize the skill sets and strengths of their employees to achieve the overall business objectives. 37| the people tree