Transcript Presentation - Organization Design Forum
What’s common to these firms?
A privately held Fortune 500 Company that provides various services to residences and firms.
“It is not just what we are doing but what we are becoming in the process that gives us our distinct value.
”
- William Pollard, Chairman
The largest coffeehouse company in the world, with 15,012 stores in 44 countries.
The largest airline in the United States by number of passengers carried domestically per year.
“To Provide the Best Customer Service, Put your Employees First.”
- Colleen Barrett, President
“We built the Starbucks brand with our people, not with consumers.
Because the best way to meet and exceed consumer expectations was to hire and train great people.
We invested in employees.
”
- Howard Schultz, Chairman
Guarantees Made to HCL Employees
• We will not give you responsibilities • We will not respect your aptitude • We will not treat you equally
Guarantees HCL to Employees
• We will not give you responsibilities
– You will have to
take
responsibilities
• We will not respect your aptitude
– We will respect your
attitude • We will not treat you equally
– We will treat you
fairly
Stepping back in Time STATE OF BUSINESS IN 2005
State of Business - Assessment of 2005
Employee driven market conditions Recruitment, engagement and attrition needed new approaches
Employees Customers
Traditional outsourcers extending focus from cost to innovation, productivity, resilience and flexibility New generation outsourcers looking for transformational gain Disruptive technologies and new business models
2005 Competition
The “Me too” phenomenon and the need to differentiate The value volume conundrum – linear extension of business model largely through application business Strong aspiration quotient to be leaders in the service space
HCL Leadership Shareholders
Increased revenue growth rate and profitability to be in line with peers
The Big Change HCL TRANSFORMATION
Four basic questions
1. How do you differentiate in today’s world • By adding value 2. Who adds Value?
• Employees 3. Where do they add value?
• Value Zone – the interface between the Service provider & Customer
4. If Employees add the ultimate value..
What should the role of management be?
Enable, Engage & Empower
employees
Vision, Mission & Values
Cycle of Transformation
Strategy Creation Implementation Challenge Change Management Implementation
“What” of strategy
New Products New Propositions New Markets
“How” of strategy
How the business runs Engagement Empowerment Owners of change
What Changed in HCL From Effort and Input Focus To Output / Outcome Focus From Discrete Services To Integrated Services From Indian IT competition To Global & Indian IT competition From Factory approach To Individual Identity -4 From Traditional ADM Services To New Services From Aspiration To Empowerment and Enrichment
Departing from Traditional Leadership Model Customer The Value Zone
Customers Employees
Employee Enabling Function Management
Why Employees First ?
Customer Maximizing the WOW in the value zone The Value Zone Employee Enabling Function Management In a knowledge intensive industry, value gets created in the interface between the customer and the employee
Employees First
Enables, Engages and Empowers
employees to maximize the value by creating the WOW in the value zone
EFCS is not……
EFCS is about the individuals, their individuality and their diversity
What is Employees First
Employees First is a philosophy
that recognizes
employees as strategic to the ownership
of the companies functions and its way of working.
The tenets of Employees First
1 Mirror, Mirror…
Accepting imperfections as catalysts for transformation
2 Trust through Transparency
Seeding trust by stretching the envelope of transparency
3 Inverted Pyramid
Reversing accountability by bringing the bottom to the top
4 Recasting the role of the CEO
Decentralizing decision making
EFCS….
inspiring change
Our Approach-achieving EFCS @ HCL
Practices Process Tools
Our Approach: P (Processes) P (Practices) T (Tools)
The U&I Portal
U&I,
is an online forum was formed to bring a new level of transparency in the organization. Employees can post any question, which the CEO, along with his Leadership team, would answer. Stretching the envelope of transparency, it gives a voice to all its employees and ensures that it is heard.
Transferring CEO’s Responsibility
To strengthen the Concept of EFCS further a new section called
“MY PROBLEMS”
was introduced in the U&I portal where the CEO shares a problem faced by him with the employees who then respond with unique/innovative ways to deal with it.
Employee Passion Indicative Count EPIC Passion
being the essence of an “HCL-ite”, EPIC was designed with the aim of enabling the individual measure and identify his/her passion drivers which would eventually assist him/her in utilizing those identified passion drivers in their jobs, thereby, increasing productivity and satisfaction.
HCL’s top five Passion Indicators
Customer support Creativity Collaboration Planning & Organizing Interest
Open 360 Degree Feedback 360 Degree Feedback,
Employees can rate their managers, even the CEO, and the feedback/rating is made public across the organization. This inverts the pyramid and makes the employee a part of the development journey of the manager and the CEO.
Smart Service Desk (SSD ) Smart Service Desk 2.0,
an online problem management system to resolve issues that employee face with the enabling functions. Only employees can close these tickets, if satisfied. This brings in a culture of reverse accountability.
Value Portal Value Portal,
is about incorporating the efforts of every employee into a business strategy that will support performance and profits over the long haul. It requires each member of a team to take ownership of the organizational assets he or she manages and translate organizational strategy into a personal plan of action.
But does EFCS Really work?
In 2005 HCL ,
Proof of the Experiment
In 2011 HCL ,
18000 Employees $ 700 Mn in Revenues 79,000 Employees $ 5.7 Bn in Revenues CAGR of 30 % Operations in 18 Countries CAGR of 30 % Operations in 31 Countries
EFCS: Impact Across The Organization
Evidence of BUSINESS SUCCESS:
Evidence of CUSTOMER IMPACT Evidence of PEOPLE SUCCESS:
•HCL has grown by 3.3 times in terms of employees from 18,000 employees in 2005 to 79,000 in 2011.
•Won awards and accolades, e.g. Hewitt No 1 Best Employer in India and amongst the Top 25 Best Employers in Asia, one of Britain’s top employers 4 th year in a row, one of the 44 most democratic workplaces in the world by WorldBlu.
Proof of the Experiment:
•In 2009, during recession, HCL grew +23.5% while most of its competitior de-grew to the extent of -11.8%. In a survey done by
Forrester
(external organization) among clients served by multi vendors,
HCL has been voted as No.1 by its customer in application outsourced
Transformational Impact Created by EFCS
HCL- Large Pharma Relationship Growth Pattern
2009 2008 2010 2007 2006 2005
IS EMEA - HCM Support ESS – Multiple Application Support Short listed Global Vendor MRL Testing IS AP – Payroll support Team Size 34
EAI – TIBCO GHH IS - MSI Packaging MRL- CDS support, CALM, Partnernet GHH - M&O MSD Thailand – DW Integration IS AP –PS HCM IS EMEA Team Size 225
RIS- CDS,CGA support, ADF,CBT INFRA support First in Man Research Managed care Process Consulting MMD Data 3 support SAS support Business Intelligence Ent Architecture METIS App Rationalization Strategy MSD Singapore Volume Deal MSD EMEA PDA SFA DBA support Team Size 450
GTS – Comet 2.0 EMEA - Portfolio Mgmt/Univadis Portal Mgmt HH – CDB, Email Marketing Campaign, DAY & FAST support HH Banyu ISS – Production support Infra – DC Tracks, IBM AS400 , Preclinical M&O PTP BPO services MRL- Integration Program Mgmt GDS support PS enhancements Web eVoc Team Size 700
GTS – Univadis Directory services EIC, One Large Pharma portal Solution manager & Global Banking MMD M&O MRL App Dev FACTS DSS BI Migration ECCM Search Technical Architect ISM Framework Creation Infra GSOC MGCS Project Large Pharma BI Support EMEA M&O ETL Portal Development (PR1909312) Large Pharma HH Siebel Call Center MMD EA OSI PI Support MMD Handel M&O MMD IT Quality portal Team Size 790
GDAM_Integration Infosec_Sustenanc e Engg GSHardware_Apps HPC Support Large Pharma HPC MRL DBA MRL_BasicResearc h&Licensing_M&O Large Pharma O2C SAP Htr Support SM SOP Creation Phase Data Centre Consolidation Team Size 1075
Key Performance Parameters Service Quality
12 00 0 11 206 10 00 0 30, 0 27,8 8 000 25, 0 6 000 20, 0 10 041 26,6 8 112 22,4 8 384 22,8 8 285 21,3 4 000 15, 0 1 943 2 000 10, 0 200 5,0 0,0 Q1 '08 Standard 1 732 259 1 161 159 Q2 '08 Q3 '08 High Priority 1 366 189 Q4 '08 Emergency 1 328 188 Q1 '09 MTTR (Hrs) 200 100 0 800 700 400 300 600 500 59% 41% 34 2005 62% 38% 226 2006 Total
Resource Mix
64% 36% 74% 26% 507 2007 Offshore% 708 2008 75% 25% XXXX 2009 (Q1) 0% 10% 20% 40% 30% 60% 50% 80% 70% Onsite %
Headcount Vs Attrition
5% 4% 3% 790 708 507 1% 1% 226 2005 34 2006 2007 Attrition % 2008 2009 Headcount 1% 2010 1075
CSAT KEY HIGHLIGHTS A- CSAT Score 2010 2009 HCL Large Pharma Engagement 59.1
47.2
HCL Average 47.8
39.5
HCL CARES C SAT Rating of 6.2 on a 7 point scale for Nov 2010
Value Dashboard (2010) Value Scorecard - for December2010
Total Ideas generated Total Value of Ideas Large Pharma Accepted Ideas Value of Large Pharma Accepted ideas Ideas completed/realized Value of completed idea 18 $469,528 17 $464,596 14 $432,912
10 0
3
Division Wise Idea Split
9 0,35 0,02 1 0,04 3 0,02 1 0,01 1 0,04
0,4 0,35 0,3 0,25 0,2 0,15 0,1 0,05 0 # of ideas 100% Idea/Value Split across different areas
24%
80%
72% 12%
Support Cost Reduction 60% Process Improvement 40% 64% Operational Cost Reduction 20%
11%
17% 0% # of Ideas Value of Ideas Value of ideas
Service Maturity Map
•
Discrete Managed Services
•
Integrated Service Management
•
Project –based
• Transactional
SLA Maturity^ Pricing Model Productivity (YoY) Big Pharma Role Dependency Cost Savings Key Metrics Transactional
No SLA for Vendor T&M NA All M&O People Baseline: Labor Arbitrage Attrition, On-boarding
Project Based Service Maturity Discrete Managed Service
SLA for provider Box End to End SLA Fixed/Rate Card 0-5 % Resource Mgmt, L3 People 5 % Incremental Response/ Resolution Fixed 5-7 % Application Mgmt People, Tool 10 % Incr. to Baseline MTTR, Biz. Case
Integrated Service Mgmt
Outcome Based SLA Fixed + Service Catalog 10 % + Service Strategy, Governance Tool, Process 15-25 % Incr. to Baseline Cycle Time, Productivity
Studio Workshops–
Towards a New Thought Relationship
1. Strategic Partner Workshop (A workshop moderated by industry though leaders like Tarun Khanna, brings Big Pharma & HCL Sr. Leadership onto a common platform to identify a shared vision for the relationship: A Value Roadmap) 2. Axon: ERP Benefit Realization Deriving greater ROI on SAP Investments Moderated by Chris Beiswenger, COO HCL Axon 3. Asset Rationalization & Archival Execution Plan to accelerate IT Portfolio Optimization in a M&A Scenario HCL Enterprise Architect Dharmender Kapoor
Taking EFCS Beyond Boundaries
EFCS @ Speaking Forums
Henley Business School Harvard Business School MIT Sloan School of Management Oxford University ICEDR LRN CIPD La Fosse CIO Submit Leadership Spectrum, Nasscom Wall Street Journal-Leadership Submit
There is something unique about HCL’s management model that the world is talking about…
40 Most Influential – Five companies to watch: Facebook, HCL Technologies, Craigs List, SKS MicroFinance, LI & Fung Acknowledges HCL Technologies as the “world’s most modern management” “HCL’s Employee First and ‘democratization’ of management concept could ‘bring about a corporate renaissance.” HCL wins FT ArcelorMittal Boldness in Business Award
41 HCL Technologies was amongst the two examples of companies with Authentic Leadership which was presented at the WEF discussion in 2008 Why HCL Technologies is Disruptive and Bears Watching
– Barry Rubenstein
“…though it has not received the hype of a salesforce.com or Google, we believe HCL may very well be one of the contenders to lead the IT services world of the very near future.” “HCL’s Employee First as a new and radical management philosophy which will catch on with the world sooner or later.” HCL Technologies is Best Company(listed in India) in Investor Relations
42 HCL is taught at Harvard as a premier case study on strategy and organizational leadership HCL is featured as a case study in a global best-seller Darden School of Business has done a case study on the impact created by HCL through its “Employee First Customer Second” practice IBM and the other multinationals are becoming increasingly nervous about HCL Technologies…
What if we invest in our employees,and they leave?
What if we don’t invest in our employees and, they stay ?
Thank You
For your attention and participation!