Human resources expert Santrupt Misra can be called as one of the most popular faces of the Aditya Birla Group. In a chat with M Saraswathy, Misra, the CEO, Carbon Black Business and Director, Group HR, Aditya Birla Group talks about the group hiring plans and hiring strategies going ahead. Excerpts:
Since the group is further expanding into areas like retail and have some projects lined up in other sectors as well, would you be hiring in large numbers in 2013?
We being a conglomerate, it is difficult to answer the question on whether we will hire more or less, because not all businesses are likely to grow at an equal pace. Therefore, in some businesses, we may hire more and less in some businesses. For example: Pantaloon business that is coming in, there will be some operation business that will continue to remain back with them and we need to fill that to run our operations. So we will have to hire more there. At least we require about 200 people initially.
Similarly, those businesses where new projects are coming. We will have to hire more in cements, if more projects come in. Similarly if we expand retail business, we will hire more there. If rural commitment grows and if banking license comes through, we will have to hire more. So, it all depends on which business one is talking about. How does the economy grow.
The whole industry is talking about cautious hiring in 2013 due to the slow growth in economy. So, will you be cautious in terms of hiring?
We would always like to be more cautious about hiring, because India is talented and if you want more personnel, then you can hire more. So, why should one hire and hold. It doesn't make sense to hire and then downsize.
Cautious optimism in hiring will continue. The reality is things will take time to turn. In India, we do not yet have political stability, so we do not know. Europe is economically unstable, Chinese economy keeps moving up and down. So, depending on which business is in which geography, we will have to see that how this whole thing plays out. Hiring to hoard is not a good idea.
Have you started hiring in anticipation of the banking license? Also, former World Bank economist Percy Mistry recently said that banking licenses should not be given to conglomerates, as there could be to a conflict of interest. What is your view?
I do not know about Mr Mistry's point of view about conflict of interest. In life, in everything you do, there is a conflict of interest. You need to recognise that and have robust transparent ways of managing conflict of interest.
One cannot run away from conflict of interest. The point is why should a conglomerate have a conflict of interest.
So this is as long as they don't lend to their own group companies? Even if they lend. Transfer pricing today happens at arm's length, lending is nothing but transfer pricing of an instrument called money, at arm's length. So why can't it be done?
So, as long as independence of decision making that bank has, like any other bank would have, prudence is exercised, arm's length issues are done, regulatory requirements are met, there is no conflict of interest there.
I think in a country where the PM or minister works, their children also have a right to work. Their children also have the right to work with the government and right to do business. If you go on identifying potential conflicts of interest, and part of the reason why India is in this mess is due to the fact that we seem to not give credibility to anyone.
There are wrong things that need to be questioned, but questioning everything is not sensible. I think that one has to judge issues on merit rather than blanket painting it as conflict of interest. I don't think that there is an issue of conflict of interest.
So are you optimistic about getting a banking license?
If we get the license, we will start hiring. We are hoping to get it. If we get the license, my belief is that we will make one of the finest banks. Birla Group used to own UCO Bank before it got nationalised. So, banking is nothing new to us. So, if we get a banking license, it would be nothing new or unusual for us.
Even in mutual funds and insurance industry, we manage thousands of crores of investors' money. Banking is nothing but managing depositors money. Given a chance, we will make one of the finest bankers to the nation.
In retail industry, there is a big issue of people leaving. Is this a big challenge for growth?
Attrition is there in retail, BPO and insurance industries too. It is a challenge, not just for us, but the entire industry. This is because the industry takes a large number of young people. These people join due to the fact that they needed a job and not a career. They get in and then their mind changes, so they leave. In insurance, one gets a banking job and leaves; in travelling jobs, one gets a desk job and leaves.
So there are a host of reasons why people leave. Leaving per se does not bother me, as long as attrition is in line with the industry. What would bother me as an HR head is when people leave us for the wrong reasons.
So, what are the strategies that you would adopt to retain people? Would you continue to hire from B-Schools in India and abroad?
The first thing is the brand called Aditya Birla. The brand opens doors. Our investment into learning and training is helpful. We are conscious about building fairness. Our compensation is competitive and our work conditions are also good. All of this helps us to retain people.
We hire at different levels in our system. We have a group scheme called LEAD and LEAP for management trainees, and then individual businesses hire. At LEAD-LEAP, we take about 35 people from Indian School of Business (ISB) and Indian Institutes of Managements at Ahmedabad, Bangalore, Calcutta, Lucknow and Xavier Labour Relations Institute (XLRI).
We also take summer trainees from abroad and have taken students from INSEAD, France and Wharton Business School, Pennsylvania, and plan to pick up students this year too.
Since international economies are not doing very well, are you still creating more jobs abroad?
In some areas yes. In Brazil, there is a Pinda facility expansion and we are creating jobs. We have added people to R&D in North America. We add more BPO jobs in Canada and other places when we get more clients. You dont add hundreds there. Headcount is very tight there.
In nations abroad, since wage costs are high there, headcount is stringent. Here, wage costs have been low, so we are liberal. Though of us who are sued to low cost resource haven't realised over the past ten years that costs have increased. In 1996, for Rs 2 lakh you would get a management trainee. Now you pay about Rs 20 lakh for the same person.
An undergraduate at a consulting firm would start at a $1,00,000. An undergraduate here will never get a $100,000 job. Even postgraduate from the best institute will get maximum job of Rs 25-30 lakh. So there is a gap. Though cost of living there is high, but in absolute terms there is still a gap.
Is your store 'More' shutting retail shops in Mumbai?
We have stores in Vashi and Thane. In retail business, you need to get a certain revenue per square feet in a certain time. If you do not get it, you realise that the business is not very viable. That time you have to take a call to shut the shop.
Since college graduates tend to leave early, what have you done to retain them?
We think that if could hire college graduates and offer them a job in the neighbourhood of where they live, they save more. So, employing people closer to where they live or belong to, perhaps reduces the rate of attrition sometimes.
It works sometimes in practical reasons, in areas like retail, where a shop is to be opened on time. So, you hire people as shop assistants from neighbourhood. Local language is also important. Further, sons of the soil theory to hire locals is also becoming important.
So, do you outsource some jobs on contract too?
It depends on the business. In cellular telephony, we had bought some people on contract. But when we found that the commitment levels were low and brought them back. Now, i am told that there is a regulation coming in cellular telephony that even document verification has to be done by own employee and cannot be done by an outsourced agency. So, regulation changes the model. Sometimes, we find that specialist agencies do the job better, so we outsource it.
But, earlier people used to outsource as costs were lower. Now, it is increasingly becoming a myth. Now it is becoming as firms want to do their core work and leave it to others to do other jobs.
Succession planning is a major HR issue today. How have you been able to build your leadership pipeline?
We have been giving exposures early, leveraging size and canvass available and seniors mentoring next generation people. We have been able to move an individual from insurance to cement, move people from garments to retail and chartered accountant to lead fertilisers and insulator. When you are willing to take risks with people by changing their sectors and functions, leadership pipeline evolves.