Talking to All Things Talent, Krishnamurthy Shankar, EVP, Group Head, Human Resources Development, Infosys, explains in detail how HR should prepare for an IPO, the tech talent conundrum, and the impact of going public on the firm’s human capital.
The Indian market has seen over 60 companies go public in 2021. What role does HR play in institutionalising the company making it public ready?
Going public brings many responsibilities of governance. You are now accountable to all shareholders as well as other stakeholders, and society. Your reputation becomes critical. And reputation can only be managed by the right culture, the right processes, and the right people. This is where HR comes in. First, strengthen key processes related to people and governance. Second, get the right talent to fill up key roles well in time so they can build their teams. And third, focus on ensuring that leaders and employees exhibit the right behaviours – that will be the foundation of your culture.
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How does a deep understanding of people systems help maximise human potential?
The simple fact is this – if you want to get your people to be at their best, there are two key levers. First is your leadership style – how do you lead and inspire your team. But this affects only a small group of people working directly with you. The second and more scalable way is to design the right people systems, in the right way. Systems to do with building a fair and inclusive workplace, attracting and hiring people, driving execution and ensuring results, building a competitive cost base, building your future leaders, ensuring people learn relevant things, and so on.
How can companies be better prepared for the Back to Office aspect?
The focus should be on employee well-being, showing care and compassion for the employees and supporting those who may be badly affected by it. It is best to get as many people to work from home as possible during this time. As the wave recedes, each organisation will have to work out a flexible hybrid model that is best suited to its needs and meets the aspirations of its people. I emphasise the word ‘flexible’ here because nothing will be constant – the situation in 6 months will be different from now – so we have to keep assessing the environment, listening to our people, and deciding the right approach for the context.
Some of the large institutions in the country are built by visionaries. Do you think HRs can be institutional shapers for a company?
Of course, we have seen that in many organisations, HR has been at the forefront of building the institution by shaping the values and culture. For example, if a company does very well even after a successful CEO leaves the company, that would be due to the institution-building that has happened. And institutions are built through the right talent and culture – and HR plays a key role here. Three key pillars are needed to build an institution. First, it should have a larger purpose, a clear long-term mission. Second, a clear set of values that everyone stands by. And finally, a focus on developing leaders and talent for the future.
“Three key pillars are needed to build an institution. First, it should have a larger purpose, a clear long-term mission. Second, a clear set of values that everyone stands by. And finally, a focus on developing leaders and talent for the future.”
What is your observation on the crisis of tech talent availability from your past experiences? How are Indian IT firms playing a larger role in tackling skilling-related challenges?
We have seen a big jump in the demand for tech talent. That’s because of the huge growth in the cloud and digital businesses, and many organisations trying to transform and become more digital. There has been a sudden spurt after a bit of lull last year due to the pandemic, that’s why we are seeing a huge talent crunch. The Indian IT services firms have been at the forefront of developing talent. The industry hires close to 3 lakh fresh engineers each year and trains them. Over the last few years, many companies have worked on reskilling – training people from traditional services for digital skills. The reskilling agenda has been critical to meet many of the demands of talent in digital and cloud businesses.
A significant pool of talent trained by large IT firms are picked up by startups — this trend is more pronounced this year. What’s your view on this? Does this affect culture building in startups?
This is natural. There is a big demand even in the startup ecosystem as there is now plenty of funding available. However, startups also have access to other talent pools, apart from large IT companies, and they end up getting diverse talent. I agree it is then important to build a consistent set of values across all segments and work towards a standard set of behaviours and culture. Companies will now increasingly have very diverse people and they will have to work towards creating a culture where each of them will feel included and contribute and grow in the organisation.
Also read: Listing Improves the Stature of the Organisation, Hence Attracting Good Talent Becomes Easier: Rajesh Derhgawen, Nippon Life India AMC
The Great Hiring Drive has also accelerated attrition rates (across experience levels) as potential candidates have multiple job offers at hand. Is this normalised? What is the global situation?
Attrition globally has increased, though the reasons would vary from country to country and from sector to sector. The tech sector’s attrition rate has increased globally due to a big spurt in demand coupled with a slower supply of talent. But in the US, many employees from the hospitality and healthcare sectors are giving up their jobs and want to pursue different types of roles. Startups are growing and they need all kinds of talent in tech, business development, sales, finance, and HR. We may see an increased talent shortage through this year, but once the supply of new graduates and engineers picks up during the year, it should stabilise. I believe the best strategy in these times is to think long-term, build your value proposition as an employer, and focus on your talent development. That will be the only sustainable long-term solution.
What is the impact of an IPO on the human capital in a company?
Firstly, it increases the aspirations of the people. It rewards an organisation for all the hard work put in and the market recognises the value of organisation. If you do an IPO, for people with shares – it becomes a value generator, it is liquid, and it’s a wealth creator for retaining the key employees. It also motivates other startups to choose IPOs. At the end of the day, the IPO is how the stock market values your organisation. In a nutshell, it gives value to the organisation. For those with stocks, the value is reflected in those stocks and the IPO makes that stock liquid.
In India, there is also strong governance with market regulators. So you won’t have to fly by night operators.
From an employee strategy, what are the key changes post-IPO?
There are two key things that HR can bring in through the IPO process to institutionalise good practices in any company. Firstly, strengthening the governance of the IPO-going company. It includes the systems and the processes – these also develop the culture of the organisation. For a large organisation, controls only come through culture. This is something that HR can start building on – creating the culture, setting the tone at the top, setting the key values of the organisation – this is how a large organisation is managed and how the governance is established.
The second is talent. If the company is heading for an IPO, it needs to hire key people and ensure that there is the right talent that will enable the IPO. The talent needed could be in finance with experience in dealing with investment banks. Others include marketing, sales, and business development.
What is the role of technology and digitisation in the IPO process?
In today’s time, if the processes are not tech-enabled, then it becomes difficult to manage them. Tech enablement helps in standardisation. It brings in a lot of process control and discipline. The second thing is that it makes it much faster to get tasks done. The third is analytics which tells you what’s happening and who is doing what. This can be used to increase the effectiveness of the work done.
Finally, technology is what people want. For a great employee experience, the technology interface becomes very important. These are the areas where the role played by technology is important.
But, one needs to be careful in not over-engineering the entire process. Every employee would like an easy interface for a better employee experience and technology is important for that.
Also read: Being Public Ready Or Going Public Shows The Maturity Of The Model And Sustainability Of A Company: Meenakshi Priyam, udaan
IPO could be validation for the future employees to join and not some fly-by-night operators. How is that for attracting critical talent?
The IPO puts some expectations on the company and creates a larger branding of the organisation. This really helps in attracting talent, however, the basics of hiring should not be lost. The company has to continue ensuring that they hire the right people, not over-inflate specs, and hire people that are too big for the role.
The IPO also enables organisations to reward the key talent better by opening up stock options and these become much more transparent and liquid post-IPO. The listing also creates more transparency of valuations and therefore stocks could be used to reward talent.
“The IPO also enables organisations to reward the key talent better by opening up stock options and these become much more transparent and liquid post-IPO. The listing also creates more transparency of valuations and therefore stocks could be used to reward talent.”
Can you shed some views on developing the DNA of inclusive culture?
Over time, the importance of inclusive culture has increased. Women leading startups have increased. But, we have to ensure that there is the right kind of environment, funding, and support system. The leaders also need to ensure that there is an inclusive culture and opportunities created for women to do bigger roles.
And lastly, how did listings change the role of HR?
HR has evolved a lot in the last three decades. In the past, HR was admin and IR-oriented. Over the last 20 years, HR has evolved a lot. It has become a key part of every organisation. Talent has become very critical, so has the culture of the organisation. HR is involved in long-term strategy, designing compensation strategy, hiring the right people, building the appropriate culture, etc.
In this special interview, Krishnamurthy Shankar, also gets candid about his new book ‘Catalyse’ and why he calls it a ‘contemporary HR playbook’.
Could you provide us with some highlights of your recent book? Its significance to the fraternity and the industry at large?
‘Catalyse’ is meant for anybody keen to get their people to be at their best, whether they are in HR or leading a business. I have tried to blend in my learnings over three decades, along with some emerging new theoretical concepts, in the context of the changing environment – to arrive at a contemporary HR playbook. The book shuns the traditional silos but looks at people outcomes needed. It explores questions like, ‘What are the different ‘jobs to be done’ for the company to grow and be successful? All in all, it tries to look at people processes holistically.
The introduction of your book mentions ‘When we look at organisations in their quest to create value, it would be good to look at what jobs need to get done to realise that value.” In the present context, do you envision the emergence of newer roles and responsibilities to get work done in a fiercely digital world ravaged by a pandemic?
In the new environment, HR needs to take on 3 key roles – building an inclusive organisation, being a partner to every talent in their development, and finally, being an architect of the right collective emotions and culture. In the digital world which is fast-changing, each of these roles of HR will be critical. We will have an increasingly diverse and global workforce, however, the challenge will be to make them feel included. The fast-changing environment will mean that we have to help each of our people develop new skills much faster, we have to be a partner in their growth and development. Finally, we have to help build the right culture and the right collective emotions amongst our people, which will help the organisation succeed.
Your book speaks about a new framework for HR professionals based on the above distinct roles. How do budding HR managers create such a framework in legacy or promoter-driven organisations?
Whether a promoter-driven organisation or a professional organisation, I guess all are interested in the success of the business. The difference is only in how they approach it. The future success of any organisation will increasingly be driven by talent, culture, and reputation – we will have to make this obvious. In a legacy/promoter-driven organisation, my suggestion would be for HR to continuously speak to the leaders and take small steps to get the initial wins. Rather than focusing on big words and presentations, they should plan small steps and make a difference.
Market Presence: Over 50 countries across 234 locations
Employee Count: 2,92,067 (as of December 31, 2021)
Workforce Pie: S/W professionals account for 2,76,942 while sales & support constitute 15,125 employees. (as of December 31, 2021)
Business Operation: Infosys is a global leader in next-generation digital services and consulting. We enable clients in more than 50 countries to navigate their digital transformation.
Employee Metric: 39.6 percent of the employees are women. Infosys aims to have a gender-diverse workforce with 45 percent women by 2030.