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INNOVATIVE HR PRACTICES IN

IT INDUSTRY IN INDIA -

AN EMPHIRICAL STUDY

MINOR RESEARCH PROJECT

UGC SPONSORED

2013-15

by

Mrs. B.VIJAYALAKSHMI MURTHY

DEPARTMENT OF COMMERCE

V.E.S.COLLEGE OF ARTS SCIENCE & COMMERCE

(UNIVERSITY OF MUMBAI)

CHEMBUR, MUMBAI-400071.

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ACKNOWLWDGEMENT

"I am a success today because I had a friend who believed in me and I did not have the heart to let

him down" - Abraham Lincoln

There are many people who believed in me and I hope I have not let them down. I extend my

gratitude to Principal -Dr J K Phadnis for all her moral support in completing this project. I wish to

thank Prof Gayatri Balasubramaniam and Prof Umesh Chauhan for persuading me to take up this

project. My heartfelt thanks are due to Prof (Dr) Barhate whom I kept consulting for guidance on

how to go about dealing with non-technical aspects of doing a minor research project right from the

beginning. I also thank my colleague Prof Aarohi Khar, Prof Lekha Nambiar and Prof Riddhi for

helping with documentation work.

I gratefully record my thanks to HR Managers of IT Companies surveyed who whole heartedly

cooperated in answering the questionaire. My special thanks Prof (Dr) Shelja Kuruvilla of ITM ,

Kharghar,Navi Mumbai for her valuable guidance and support for data analysis.

Truly I owe my sincere thanks to my husband Mr B.V.R.Murty who stood by me on all accounts ; be

it assisting me on all matters of consultation regarding the project work or the home front. His silent

and calm support kept me going.

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FINAL REPORT OF THE WORK DONE

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Contents

Executive Summary ........................................................................................................................................ 6

1. INTRODUCTION ...................................................................................................................................... 8

1.1 HRM in India ........................................................................................................................................ 8

1.2 Objectives Of The Study ..................................................................................................................... 11

1.3 Organization of the Chapters .............................................................................................................. 11

2. LITERATURE REVIEW ......................................................................................................................... 12

2.1 Innovative Human Resource Management Practices (iHRM) ............................................................ 12

2.2 Need for adoption of iHRM practices ................................................................................................. 13

2.3 Innovative Human Resource Initiatives in various functions of the HR ............................................. 13

2.4 Innovative HRM Practices in some of the Well-known and Established Companies in India ........... 14

2.5 Innovative HRM Practices in the IT and ITES Industry ..................................................................... 16

3. RESEARCH METHODOLOGY .............................................................................................................. 19

3.1 Instrument Development And Measures ............................................................................................. 19

3.2 Operational Definitions and Measurement ......................................................................................... 24

3.3 Validity and Reliability ....................................................................................................................... 29

3.4 Sample Design and Data Collection ................................................................................................... 32

3.5 Statistical Analysis .............................................................................................................................. 33

3. Analysis and Findings ............................................................................................................................... 36

3.1 Description of the sample ................................................................................................................... 36

3.2 Need for innovation and areas of HR .................................................................................................. 37

3.3 iHRM and its adoption in Indian IT organizations ............................................................................. 39

3.4 Importance ascribed to iHRM and extend of Adoption ...................................................................... 40

3.5 iHRM strategies in selected HR functions .......................................................................................... 42

3.6 Reasons/Influence on iHRM ............................................................................................................... 44

3.7 Impact of iHRM practices ................................................................................................................... 46

3.8 Organizational commitment and iHRM .............................................................................................. 47

3.9 Importance of iHRM for organizational commitment ........................................................................ 48

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3.10 Organizational commitment and organization size 49

3.11 Outcomes of iHRM and size of the organizations ............................................................................ 49

4.Discussion, Recommendations and Conclusion ........................................................................................ 52

5. Limitations and Future Scope .................................................................................................................. 56

References ..................................................................................................................................................... 57

Annexure :EXHIBIT 1 60

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EXECUTIVE SUMMARY Executive Summary

Information Technology Industry in India has come of age and the competition between the

various players have intensified. The main resource based on which IT companies define their

core competencies have always been “manpower”. Therefore attracting capable employees,

developing them in the organization, retaining them and maintaining the knowledge they create is

a major strategic objective for all the organizations in the sector. To do so the Human resource

departments in these companies has to evolve and take on a more central role in the organization.

With the top management support, the HR function in IT organizations has taken to the new

challenges posed by the business environment by bringing in innovation in the Human Resource

practices. While trade papers intermittently record these efforts, research efforts have not been

undertaken to understand the extent and impact of iHRM practices in India especially in the

Information technology context. Therefore this study attempts to understand:

1. The extent to which HR managers believe that innovation in HR practices are important

for achieving goals of the organization

2. The major areas in which innovation is required

3. The extent to which Indian companies have succeeded in inculcating innovative HR

practices

4. the major influences on the kind of HRM innovations adopted by Indian IT organization

5. The important outcomes of innovation in HR practices with reference to organizational

commitment and performance

In order to do so, HR managers at twenty large, medium and small IT companies were

interviewed in the city of Mumbai with Headquarters in Bengalure. The results of the study

indicate that HR mangers agree that including innovative HR practices is extremely important

especially in the process of attracting and rewarding employees which are two of the largest

challenges they face. The areas in which these mangers are currently seeing extensive use of

iHRM practices include the Compensation, Rewards and employee acquisition strategies. In

Employee acquisition use of referral bonus and the social media is increasingly common while

use of a blend of financial and non-financial rewards in addition to “Best employee” etc. is also

finding more takers. Virtual working has also become increasingly acceptable to organizations if

it means that they can retain talent. These innovative practices according to HR mangers of these

companies help organizations to remain competitive in the job market; moreover their clients also

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audit them to ensure that their HR practices are as per acceptable international standards. With

these and the employee satisfaction in view, top managements have also been pushing their HR

departments to bring in innovative HR strategies. But on the flip side, these HR managers feel

that in spite of the efforts the industry is making, the employee commitment levels are low and

they will shift for higher pay or status.

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CHAPTER 1

Introduction

1. INTRODUCTION

India was declared itself open to Liberalization in the year 1991. This paved the way for

industrialization and rapid transformation in the Industry and Business sector. Liberalization also

meant change in the working style of the people and hence organizations needed to innovate the

HRM practices in an effort to ensure survival in an increasingly hypercompetitive environment.

(Som, July 2008) (Muduli, June 2012).

The key challenges of any HR department are employee acquisition, retention, developing

employees, performance management, and talent-management according to (Ramlall, 2009).

Seeking, developing and engaging and keeping talent is a big challenge for today’s organizations

because of innumerable options available outside (Ramlall, 2009). This is especially true for the

Indian IT industry. Hence, (Ramlall, 2009) argues that if companies continue to implement or use

the traditional ways of Human Resource practices, is it quite doubtful whether the HR manager

would be able to sustain the organization during an economic downturn.

1.1 HRM in India

Previous research has shown that Human Resource Management is one of the most important

determinants of organizational performance or efficiency. According to (Stephen A. Stumpf,

May-June 2010) companies functioning in India create a robust human resource team by

incorporating a strong organized HR practice in place.

The authors, (Stephen A. Stumpf, May-June 2010)compared the HRM practices implemented in

private and public sector in India, and found some startling facts, such as the HR practices used in

the two sectors were quite similar on parameters such as 1) the structure of the HR department, 2)

role of the HR manager in corporate change, 3) recruitment and selection process, 4)

compensation and benefits, 5) training and development, 6) employee engagement, 7) and

emphasis on key HRM Strategies. It is also found that on certain parameters such as the

compensation and training and development, the private sector seemed to have adopted a practical

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approach such as screening and testing of job applicants to ascertain the applicant’s job-fitness,

training need analysis, training evaluation, etc. These authors are also of the opinion that Indian

companies whether big or small implement HRM practices such as employee involvement

practices, training and development practices, employee welfare practices, managing employee

relations to manage employees. (Stephen A. Stumpf, May-June 2010)

Foreign MNC’s have also realized the potential of Indian employees, and hence are entrusting

them to take up higher responsibilities. This is especially true in the Information technology

business. For example, IBM’s Indian workforce increased from 9,000 in 2004 to 50,000 in 2007

and GE gave the Business Process outsourcing job to Genpact, which is India’s largest BPO

organization and has a head count of nearly 30,000 employees. Accenture also expects its Indian

workforce numbers to exceed its USA head count (Stephen A. Stumpf, May-June 2010). Salaries

of the Indian workforce increased 15% or more annually from 2002 to 2007. But the attrition

level also increased with an approximate increase of 15% to 30% every year (Stephen A. Stumpf,

May-June 2010). (Stephen A. Stumpf, May-June 2010) opinioned that the high attrition levels

and acculturation posed the biggest challenge to the growth of a company. It is considered that

good HRM practices are more important than ever in this industry with currency fluctuations etc

in the global economy leading to unprecedented uncertainties.

Human resource practices have, evolved over the period of time due to globalization, changing

needs and requirements, privatization/deregulation, competition. These external forces have

exerted companies to implement newer HR practices for sustained and improved organizational

and employee performance (Gurbuz, Nov 2009). Employee turnover is one of the biggest

challenges of an organization. Therefore, retention of talented and skilled workforce becomes

crucial because it creates a competitive advantage for the company. Labor force is regarded the

most indispensable asset of an organization and retaining the manpower becomes imperative.

Retention becomes even more crucial because acquiring new talent becomes very expensive;

hence retaining the old labor force becomes the smarter choice (Kiwook Kwon, 2010) (Jr., 2011).

It has been researched that the employee turnover or the attrition rate is found to be very high in

the Service and the BPO or the Business Process Outsourcing Industry (Cho, June 2010) (Chand,

March 2010). It has been observed that because of heavy industrialization and accelerated

globalization, the working environment has become very stressful. Hence, employees fail to strike

a work-life balance which results in increased turnover, absenteeism and sickness (Thomas

Lange, Oct 2010).

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In these turbulent times, Human Resource function is considered an indispensable part of every

organization in the world. Previous research has also suggested that there exists a positive

relationship between HRM practices and organizational performance. It is considered to be the

heart and soul of an organization, and the organizational efficiency or performance is dependent

on the Human Resource function. Human resource management is therefore a very important and

crucial task of an organization. Tasks significant to the success of a company are talent

acquisition in terms of recruiting the right manpower with the right skill sets, employee retention,

Training and development, employee health schemes, enable a work-life balance, and encourage a

free, open work environment. (Gurbuz, Nov 2009).

Today, when there is so much competition around, Innovating HR practices has become the need

of the hour. Previous research and literature made it clear to academicians and practitioners alike

that there exists a relationship between human resource practices and organizational effectiveness,

since the HR practices influence employee behavior, productivity, and consequently affect the

organizational effectiveness (Agarwala, March 2003).But soon organizations realized that most

organizations incorporated the traditional practices in HRM as a norm and therefore it in search

for competitive advantage in the HR space, organizations sought to ‘think outside the box’ and

come out with an innovative approach to HRM. The traditional set of practices or standards had

become redundant with limited application. (Agarwala, March 2003). According to the

(Agarwala, March 2003) there is a need to constantly develop and innovative Human Resource

practices to remain competitive in the industry. Indian practitioners and Academicians too are

gradually understanding the need to investigate the key HR issues and Innovate HR practices to

resolve them (Solanki, 2009).

Innovative Human Resource Practices has been explored by its many facets in research. Some

authors have referred to these as ‘high performance’, ‘high commitment’, or ‘high involvement

practices’ (Agarwala, March 2003) (Williams, Feb 2003). Trust is recognized as a critical factor

for organizational performance in the workplace. Therefore, ‘High commitment’ HR practices are

expected to show the employees, the extent to which the organization trusts them (Williams, Feb

2003) (Rosalind Searlea, Mar 2011) (Tzafrir, Sep 2005). (Williams, Feb 2003) states that

organizations that implement ‘High Commitment’ HR practices are rather successful in building

up a team of employee’s who can be trusted in matters important to the organizational

effectiveness. The author lists down the “High commitment HR Practices such as employment

security, selective hiring, team-working, performance-related pay, Training and development,

egalitarianism, information sharing”. (Williams, Feb 2003).

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Research also indicates that the outcome of innovative HRM practices can be important towards

retaining employees and employee performance. In addition to a positive relationship between

age and duration of service in the organization and between clear job description and

performance, it is also found that the longer the duration the employee has served in the

organization, more loyal he tends to be and less keen he tends to be to shift to any other

organization. Similarly, if an employee is guided properly with proper training and development

and clear job description, he tends to perform better than those who are not guided appropriately.

(Williams, Feb 2003).

1.2 Objectives Of The Study

While there is considerable interest in academic research in the area of iHRM or innovative

Human resource management and considerable need for the same suggested by the ever changing

external environment, the extent to which these practices have been adopted by the Indian IT

industry have not been explored understood and documented. Therefore, the objectives of the

study are to understand:

1. The extent to which HR managers believe that innovation in HR practices are important

for achieving goals of the organization

2. The major areas in which innovation is required

3. The extent to which Indian companies have succeeded in inculcating innovative HR

practices

4. the major influences on the kind of HRM innovations adopted by Indian IT organization

5. The important outcomes of innovation in HR practices with reference to organizational

commitment and performance

1.3 Organization of the Chapters

In an attempt to address the various objectives set by this study a research was undertaken. The

introduction to the back ground of the study and the objectives are discussed in Chapter 1.

Chapter 2 goes in to the literature base for the study and the conceptual evolution of the research

gap and need for the study. The methodology followed is discussed in detail in Chapter 3.The

results and analysis is presented in Chapter 4. This is followed by a detailed discussion of the

findings and the evolved recommendations. Chapter 5 discusses the various limitations faced by

the study from the methodological and applicative perspective. It also discusses possible future

directions. Finally Chapter 6 concludes the report. After presenting the References, the survey

format used is exhibited as an Annexure.

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CHAPTER 2

LITERATURE REVIEW

2. LITERATURE REVIEW

2.1 Innovative Human Resource Management Practices (iHRM)

Human Resource Management Research has always been a very hot topic and has been discussed

and researched by several researchers all over the world. There have been several developments

in the Human Resource field and the Human resource department has eventually evolved over the

years (Paauwe, Nov 2001) (Harvey, Dec 2001). Because of rapid industrialization and

globalization, the need for trained and skilled manpower becomes imperative. Companies have

started recognizing the importance of the HR Department and are aligning the HR function to the

strategic business goals and objectives (Srimannarayana, Oct - Dec 2010). HR Department would

be accountable for the strategic decisions and the overall performance of the organization

(Harvey, Dec 2001). A lot of Researchers have emphasized that employees that work in teams or

team work has resulted in productive performance of the organization (Carmen Camelo Ordaz,

April 2008). Nowadays, there are many companies which have also adopted newer technologies

like internet services in an effort to undertake their HR responsibilities. There are many social

networking websites available which connect people from the farthest corner of the world.

Websites such as naukri.com, timesjobs.com and LinkedIn are very popular websites for

recruitments in India. (Bing, 2011).

While a few research efforts have been made in this area,a definition for it is sparce. Som in the

article titled “What drives adoption of innovation in SHRM practices in Indian Organizations”,

(May 2007) and in “Bracing for MNC Competition through Innovative HRM Practices : The way

ahead for Indian Firms”, (March-April 2006) defines innovative HRM practices as “Any

intentional introduction of HRM programme, policy, practice or system designed to influence or

adapt employee the skills, behaviors, and interactions of employees and have the potential to

provide both the foundation for strategy formulation and the means of strategy implementation

that is perceived to be new and creates current capabilities and competencies”.

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2.2 Need for adoption of iHRM practices

The dynamic and changing business environment of India, that started off with liberalization in

the first phase, then moved on to privatization/deregulation (second phase), and the third or the

current phase of globalization, has made it imperative for modern organizations to adopt iHRM

practices (Som, May 2007). Previous research has also indicated and shown that organizations

adopt iHRM practices to improve their organizational performance According to authors who

have worked in this area, organizations adopt iHRM practices to remain competitive and save

their business. Several Indian organizations have adopted iHRM practices to remain competitive

and improve their organizational performance (Singh, June 2003). Companies such as Hero

Honda, Tata Motors, Bharat Forge, Hindustan Inks, Sundaram Clayton, BPCL, Maruti Suzuki,

Infosys, and Wipro were able to successfully adopt iHRM practices in their organizations to

withstand the blow of liberalization, privatization, FDI, and the threat of MNC’s (Som, May

2007). Sung-Choon, (2013) and Conway, (2011) suggests that organizations are inclined to adopt

IHRM practices to improve or augment their organizational efficiency and employee productivity.

It also suggests that organizations now face severe competition or regulatory pressures which

again makes iHRM practices inevitable. A previous research interviewed some HR professionals

in the U.S, who named some 40 innovative HR practices that were executed or implemented in

their organizations. Some of these innovations that were named were human resource information

system, 360-degree appraisals, internet or online recruiting, Six-sigma, outsourcing, competency-

based compensation, etc.

(Som, May 2007) argues that the Human Resource Department in India is poorly managed and

staffed and is very unorganized and unstructured. Hence, the HRM department was under intense

pressure to adapt and adopt new practices to grow a new breed of skilled, well-trained and

motivated manpower. Therefore, more and more companies are adopting innovative HRM

practices (Som, May 2007) (Vernon, Jan-Feb 2008). These innovations are not limited to a few

factions. HR managers have been successful in bringing in innovations to almost all activities

they undertake.

2.3 Innovative Human Resource Initiatives in various functions of the HR

According to (Som, May 2007) the HR Department is changing and embracing new innovative

HRM practices. The HR department is no more known as a support or a secondary function, but is

given equal importance as to the other functions in the organization. (Som, 2007) suggests the

various innovative initiatives taken by the HR department. According to the author, the

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recruitment initiatives included “fair and open systems, free flow of discussion,

induction/orientation”. Promotion and compensation were thus now done only on merit and

competency basis, and employees who are efficient, productive and competent were promoted

faster. The author also claims that “Organizations are practicing job rotation, re-training, re-

deployment to build the employees skills and knowledge in all areas of work”. Career

Development is another initiative which is introduced to help build, manage and grow an

employee’s career in the organization. Majority of the researchers are of the opinion that it is

imperative that an organization adopts innovative HR practices, which helps in breaking the

monotony and motivates the employees to work hard and be more productive. It improves the

quality of the organization’s performance (Som, 2007). (Mahal, 2012) emphasized that innovative

HRM practices in training, compensation and reward lead to reduction in employee turnover,

absenteeism, better productivity and motivation and improved financial performance.

According to (Som, March-April 2006) the motive or the purpose of introducing iHRM practices

in an organization is to enable HR synergize with the organizational strategies, keeping in mind

the dynamic Business environment. HR has to act as a Change agent or a Strategic partner and

work in sync with the organization’s objectives and goals. iHRM’s aim is to provide

“professionalized recruitment, selection and career development initiatives to build a skilled,

committed manpower. It also aims to build an efficient performance management system that

develops, retains, retrains and redeploys talent” (Som, March-April 2006). Further the concept

involves rightsizing or downsizing and decentralizing for augmenting organizational

effectiveness.

2.4 Innovative HRM Practices in some of the Well-known and Established Companies in

India

Som, (March-April 2006) and Harish Jaina, (March 2012) has put forth some examples of

companies that have implemented iHRM practices in their organization and reaped the benefits of

the same. Maruti Udyog Ltd, is a name to reckon Trust, Belief and Care. It truly revolutionized

the automobile industry in India. It faced intense competition from MNC’s such as Ford,

Mitsubishi, Hyundai and Honda. Initially, Maruti did not acknowledge the importance of the HR

Department and thought of it as an unnecessary burden. But soon it realized the HR Department’s

importance because of the mounting pressure and the threat from the MNC’s. It decided to re-

activate the HR function and link the HR strategies with that of the organization or business

strategy. The HR department was entrusted to manage the whole and soul of the organization and

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was held responsible for the employee and organizational effectiveness. Soon, the HR department

of Maruti was successful in developing a productive team, and its compensation practices became

the best in the industry (Malji, July-Dec 2013).

Similarly, Mahindra & Mahindra were also facing an similar problem. The factories were not

functioning properly, and were resulting into huge losses for the company. This was due to

insufficient manpower and influence of union labors. Earlier, the HR department was not part of

any important strategic decisions. Gradually, the HR started working towards the betterment of

the organization and introduced several innovative human resource practices. Firstly, the HR

function emphasized on building team work, that encouraged employees to share their

experiences and acquire knowledge from their fellow counterparts. It also encouraged regular

meeting to update the management on the progress of the work and to have free flow of

discussion. Interestingly, it did not believe in hiring very qualified people, since they were of the

opinion that qualified people switchover quickly for an opportunity with MNCs. Instead they

recruited professional consultants. They also allowed employees to work as part-timers or

consultants. The introduction of innovative HR practices led to steady and increased profits, and

increase in the productivity of the manufacturing facility (Som, March-April 2006).

TISCO again a very reputed and established Indian organization has embraced innovative HRM

practices in its organization. It wanted to embark on a journey to be a high performance, high

growth organization. It partnered with McKinsey to help establish key strategic areas. It

introduced a program known as the PEP or the Performance Ethic Program, which encourages

young employees to grow up the corporate ladder swiftly, as against the traditional way of

promoting employees. It has also introduced a revised Performance Management System, which

is purely competency based and depends on the fulfillment of the KRA’s of the employee (Som,

March-April 2006).

Another Innovative company that has adopted innovative HRM practices is Ranbaxy. Ranbaxy

was in the export business of pharmaceuticals for the last 18 years. But somehow, Ranbaxy felt

that it was not doing good business, and that something was pulling it back. It realized that

Globalization was playing its role, and the need for global players was felt badly. Hence, it

decided to adopt innovative HRM practices to re-establish its presence in the foreign market. It

decided to encourage cross-border exchange of knowledge, so that the in-house employees can

learn about the techniques from the fellow counterparts based out of the foreign market (Som,

March-April 2006).

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Similarly, there are many other reputed Companies such as BPCL, Clariant, SBI, Arvind Mills,

Motorola and the Mehta Group that have adopted and implemented Innovative HR Practices in

their organizations (Som, Bracing for MNC Competition through Innovative HRM Practices : The

way ahead for Indian Firms, March-April 2006) (Bhatnagar, Jan-Mar 2008).

2.5 Innovative HRM Practices in the IT and ITES Industry

The Information Technology Industry has gradually evolved over the period of years. The

progression has been rapid from IT to BPO (Business Process Outsourcing) and to the newer

terminology known as KPO or Knowledge Process Outsourcing. According to the Daintith,

(2009), , “Information technology (IT) industry involves in the application of computers and

telecommunications equipment to store, retrieve, transmit and manipulate data, often in the

context of a business or other enterprise”. ITES (Information technology enabled industry) took

shape because of the increasing need of IT in every aspect of business. Small to large scale

businesses requires IT in their business. Working in ITES sector means to work within a business

setting using information technology. A major part of ITES in India is through Business process

outsourcing (BPO) which is a subset of outsourcing that involves the contracting of the operations

and responsibilities of specific business functions (or processes) to a third-party service provider.

Often the business processes are information technology-based, and are referred to as ITES-BPO,

where ITES stands for Information Technology Enabled Service.(Nellis & Parker 2006).

Knowledge process outsourcing (KPO) is a sub-segment of business process outsourcing

industry. Sachdeva, (2009) defines KPO as “The outsourcing of high-end knowledge intensive

processes requiring considerable domain expertise which necessitates a shift of execution from

standardized processes to processes that demand superior analytical and technical skills as well

as decisive judgment”. People or employees are the most important success factors that contribute

to the massive growth of the Indian IT and Business Outsourcing Industry (Disha Sachdeva,

2009).

Since IT and especially, BPOs and KPOs are a People-centric Industry, it becomes even more

imperative for it to focus and concentrate on the Human Resource management area, to acquire,

retain talented knowledge workers and to provide them a comfortable and peaceful working

environment. Picking and choosing the right talent or manpower in the BPO and IT is very

crucial. Hence, people management issues are the top most priority of the industry since the job

involves the application of the necessary job skills of the knowledge workers (Disha Sachdeva,

2009) (Naresh Khatria, Dec 2010).

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There are various challenges faced by the industry in respect to the HR function. This includes

right talent recruitment, manpower management, work-life balance, autonomy, good working

conditions (Solanki, 2009). As per (Disha Sachdeva, 2009) ‘a report prepared by the Price

Waterhouse Coopers / Confederation of Indian Industries (2005)’ “views that in KPO’s the

emphasis will be talent than on physical infrastructure and human resource management tools

and methods for recruitment, retention and motivation will have to be special because work

oriented professionals are motivated by stimulating work content and learning opportunities

rather than by parties and prizes”.

Major IT companies are at the forefront of innovation in HRM. This includes the leaders in the

industry including Infosys and Wipro. Infosys – The name of the company reminds us of the great

leadership skills of the founder Mr. Narayan Murthy. Mr. Narayan Murthy started Infosys with

his sheer determination and hard-work. He values and considers his employee workforce the most

important asset of his organization. He believes in nurturing them and providing the right skill

sets to be able to face the harsh realities of the dynamic corporate world. He believes that

knowledgeable and talented workforce is the top priority of a company and that it creates a

competitive factor for the company. Hence, the demand for talented and skilled labor force is

increasing rapidly. From a mere number of 42 employees in 1987 to 23,000 in 2003, the increase

in the number of workforce rose drastically. Mr. Narayan Murthy realized that the traditional

ways of recruiting and selecting employees had become redundant, and that the company required

to adopt innovative human resource practices to be able to attract and retain the best possible

talent in the market. In Infosys the recruitment process was interesting as well as a difficult nut to

crack. It involved a lot of puzzles, problem-solving equations, that tests the analytical, logical and

problem-solving skills of the candidate. The only selection criterion in Infosys is to test the ability

or capacity to learn of the candidate. These tests helped the company to gauge the skills and

capacity of the candidate to be able to survive in the dynamic Corporate Culture. Mr. Narayan

Murthy believes that as long as the company continues to innovate, Infosys would continue to

succeed, flourish and grow. Infosys built a training centre in Mysore, especially for its employees

for building their skills and competencies (Som, March-April 2006).

Likewise, there was another big IT company which also implemented a similar model of HR

processes. Wipro Systems is one of the most promising companies of India, embarking its

footprints in the international market as well. The Chairman Mr. Azim Premji believes that the

employees of the organization are its biggest assets. The author quotes Mr.Premji as saying, “The

key to success in all our efforts, as always, is our people” (Som, March-April 2006).

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Foreign MNC’s have also realized the potential of Indian employees, and hence are entrusting

them to take up higher responsibilities. For example, IBM’s Indian workforce increased from

9,000 in 2004 to 50,000 in 2007 and GE gave the Business Process outsourcing job to Genpact,

which is India’s largest BPO organization and has a head count of nearly 30,000 employees.

Accenture also expects its Indian workforce numbers to exceed its USA head count (Stephen A.

Stumpf, May-June 2010). Salaries of the Indian workforce increased 15% or more annually from

2002 to 2007. But the attrition level also increased with an approximate increase of 15% to 30%

every year ( Stumpf, May-June 2010). Stumpf, (May-June 2010), opinioned that the high attrition

levels and acculturation posed the biggest challenges to growth. It is considered that good HRM

practices are more important than ever in this industry with currency fluctuations etc in the

globaleconomy leading to unprecedented uncertainties.

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CHAPTER 3

METHODOLOGY

3. RESEARCH METHODOLOGY

3.1 Instrument Development And Measures

Given the objectives of the research, instrument was developed to measure

1) the importance of innovation in HRM practices Employee acquisition strategies(areas of iHRM

evaluated included -Employee Retention strategies-Induction-Training and Development-

Leadership Development-Career Planning-Performance appraisal-Compensation and incentives-

Rewards and recognitions-Welfare measures-Organization Development-Knowledge

Management-HR strategy-Employee exist and separation management-Corporate social

responsibility)

2) the evaluation of the extend of innovation adopted in various HRM practices (areas of iHRM

evaluated included -Employee Retention strategies-Induction-Training and Development-

Leadership Development-Career Planning-Performance appraisal-Compensation and incentives-

Rewards and recognitions-Welfare measures-Organization Development-Knowledge

Management-HR strategy-Employee exist and separation management-Corporate social

responsibility)

3)the major reasons for /influences on the kind of HRM innovations adopted (these reasons

included -External environmental forces-Organizational Structural Characteristics-Organizational

culture-History of success with past HRM innovations-Influence of consultants-Top management

insistence-To remain competitive in the industry-Quest for continuous improvement in HR M-To

reduce costs of HRM Services-To increase services of HRM department-To increase impact of

HRM department-To provide more satisfying work experience to the employee and

4) the impact of iHRM on organizational commitment and organizational effectiveness. This was

measures using a pre-validated scale which tried to evaluate the degree to which the employees

were likely to continue with the organization under different circumstances. It checked the

20

Employees willingness to change companies if the new job offered 25% pay increase, More creative

freedom, More status or Opportunity to work with friendlier people

Pre-validated Scales were not available for the first three sets of variables or were found not

suitable in the Indian context. Therefore, except for Organizational commitment, all the items for

the instrument were adapted from the various previous studies according to their relevance in the

Indian context and while ensuring that the items were as domain relevant as possible. Table 3.1

gives a description of the items used to measure the variables used in this study along with the

reliability measures calculated for each.

TABLE 3.1: Research Measures

Variable Reliability

scores(Cron

bach alpha)

Items Scale

Size of the

organization

NA - Category Scale

The importance of

innovation in

HRM practices

0.927 importance of innovation in HRM

practices in the following

-Employee acquisition strategies

-Employee Retention strategies

-Induction

-Training and Development

-Leadership Development

-Career Planning

-Performance appraisal

-Compensation and incentives

-Rewards and recognitions

Likert Scale

1-Completely

Unimportant………

…

5-Extremely

important

21

-Welfare measures

-Organization Development

-Knowledge Management

-HR strategy

-Employee exist and separation

management

-Corporate social responsibility

The evaluation of

the extend of

innovation

adopted in various

HRM practices

0.920 the extend of innovation adopted in

the following

-Employee acquisition strategies

-Employee Retention strategies

-Induction

-Training and Development

-Leadership Development

-Career Planning

-Performance appraisal

-Compensation and incentives

-Rewards and recognitions

-Welfare measures

-Organization Development

-Knowledge Management

-HR strategy

-Employee exist and separation

Likert Scale

1-completely

disagree……………

…

5- Completely Agree

22

management

-Corporate social responsibility

Reasons

for/influences on

for iHRM

0.867 External environmental forces

Organizational Structural

Characteristics

Organizational culture

History of success with past HRM

innovations

Influence of consultants

Top management insistence

To remain competitive in the

industry

Quest for continuous improvement

in HR M

To reduce costs of HRM Services

To increase services of HRM

department

To increase impact of HRM

department

To provide more satisfying work

experience to the employees

Likert Scale

1-Completely

agree………………

….

5- Completely agree

23

Organizational

Commitment

0.626 Employees would be willing to

change companies if the new job

offered:

1. 25% pay increase

2. More creative freedom

3. More status

4. Opportunity to work with

friendlier people

Likert Scale

1-very

likely………….

5-very unlikely

Organizational

effectiveness

0.879 -Sales Growth

-Profitability within Industry

-Market Share within Industry

-ROI

-People orientation of the

management philosophy

-Employee attitude and behavior

-Employee Productivity

-Employee Satisfaction

-Customer satisfaction

-Ability to attract and retain talent

Likert Scale

1-Completely

agree………………

….

5- Completely agree

iHRM

implemented in

Employee

acquisition

strategies

NA Social media utilization

Second career internship

Referral bonus

Industry academia interface

Checklist-

dichotomous scale

iHRM

implemented in

NA Performance linked awards

Cash awards for extra ordinary

Checklist-

dichotomous scale

24

Rewards and

Recognitions

performance

Best employee awards

Blend of financial and non-financial

awards

iHRM

implemented in

Welfare Measures

NA Focus on long term benefits for

employees through alternative

insurance and health management

systems

Benefits directed at employees

families

Recreational facilities

Child/elder care programs

Virtual working

Checklist-

dichotomous scale

3.2 Operational Definitions and Measurement

Size of the organization

The size of the organization was measured using a multiple choice question with large,

medium and small as the items. Large was operationalized as organizations with more than 500

employees, Medium as having 51- 500 employees and small as having less than 50 employees.

The name of the IT organization was collected as an open ended question.

Importance of iHRM practices

15 “importance of innovation HRM practices” questions were included asking respondents to

indicate their agreement on a five point Likert scale (5-extremely important and 1-completely

disagree). Principal component analysis with varimax rotation was conducted on the questions,

using a minimum eigen value of one as a criterion for the factors extracted. Statements that

loaded .50 or above on a single factor was included and used for further analysis. In case of a

double loading, the factor on which the item loaded higher was considered. (Refer Table 3.2).

25

TABLE 3.2: Results of Factor analysis of “importance of innovation HRM practices” items

The principal component analysis yielded three factors which were named: “Employee

Acquisition and Retention Strategies” (11.32% variance explained), “Employee Performance

management” (53.79% variance explained), and “other HR initiatives” (18.86 % variance

explained).

26

Evaluation of iHRM practices

TABLE 3.3: Results of Factor analysis of evaluation of innovation in HRM practices items

15 “evaluation of innovation HRM practices” questions were included asking respondents to

indicate their agreement on a five point Likert scale (5-completely agree and 1-completely



27



The principal component analysis yielded three factors which were named: “Employee

Acquisition and Reward Strategies” (48.79% variance explained), “Employee Growth

management” (6.85% variance explained), and “other HR initiatives” (21.5% variance

explained).

Reasons for/influences on for iHRM

12 “Reasons for/influences on for iHRM” questions were included asking respondents to

indicate their agreement on a five point Likert scale (5-completely agree and 1-completely





TABLE 3.4: Results of Factor analysis of “Reasons for/influences on for iHRM items

28

The principal component analysis yielded three factors which were named: “Environment and

top management influence” (9.8% variance explained), “To provide relevant HR strategies”

(16.51% variance explained), and “To provide strategic advantage through HR” (43.54%

variance explained).

Organizational effectiveness

10 “Organizational effectiveness” questions were included asking respondents to indicate their

agreement on a five point Likert scale (5-completely agree and 1-completely disagree).

Principal component analysis with varimax rotation was conducted on the questions, using a

minimum eigen value of one as a criterion for the factors extracted. Statements that loaded .50

or above on a single factor was included and used for further analysis. In case of a double

loading, the factor on which the item loaded higher was considered. (Refer Table 3.5).

The principal component analysis yielded three factors which were named: “Organizational

effectiveness-Macro” (48.79% variance explained), “Organization effectiveness-Micro”

(22.55% variance explained), and “Ability to attract and retain talent” (10.18% variance

explained).

29

TABLE 3.5: Results of Factor analysis of “Organizational effectiveness” items

3.3 Validity and Reliability

Based on literature Valid items were generated to operationalise the variables under study. A

measure is considered valid to the degree that it really does measure what it is intended to

measure. The internal validity can be discussed under: 1) Face Validity or content validity, 2)

Construct validity and 3) Criterion Validity (Cooper and Schindler, 2003)

Face validity

30

The face validity or content validity of a measuring instrument is the extend to which it provides

adequate coverage of the investigative questions guiding the study. Determination of content

validity is judgmental and can be approached in several ways (Cooper and Schindler,2003). In

this study, the first step involved a careful definition of iHRM and the items to be scaled and the

scales to be used. Further, these items were evaluated through conducting a screening exercise or

Judgment method (Litwin, 1995; Sekaran, 1992). The aim of the exercise was to determine the

extent to which each item reflected dimensions to be measured. The screening exercise involved 4

judges, including HR and research methodology professors. They were asked to compare and

evaluate the items included in the questionnaire with the research objectives. The judges

supported the items used to test the research hypotheses (Hair et al).

Construct Validity

In measuring construct validity, both theory and the measuring instrument are considered. Once it

is established that the constructs are meaningful in a theoretical sense, the adequacy of the

instrument is investigated. In order to ensure that items measure hypothetical concepts, iHRM

dimensions studied in previous research were used.

The adequacy of an instrument can be tested either through convergent validity or discriminant

validity. Convergent validity involves correlating the results of the present study with pre-existing

validated scales. In their absence or of they have not been used, the construct validity of a

measure is shown by showing that it relates to other variables to which it should be related

(Campbell and Friske, 1959; Green and Tull, 1980). Internal consistency therefore is a good test

for construct validity. Beyond internal consistency, evidence for new scales is difficult to find.

The most general practice is to assume, unless there is evidence to the contrary that the

respondent is responding accurately. Much stronger evidence on construct validity can come from

item by item and scale by scale convergent and discriminant validity. Discriminant validity

involves separating it from other constructs in theory or related theories. While these have not

been attempted, here factor analysis has been used to establish the construct adequacy of the

measuring device (Cooper and Schindler, 2003).

Criterion Validity

Criterion related validity reflects the success of measures used for prediction or estimation.

Cooper and Schindler (2003), suggests that any criterion measure must be judged in terms of four

qualities: 1) Relevance 2) Freedom from bias 3) Reliability and 4) Availability. A criterion is

relevant if it is defined and scored in terms we judge to be a proper measure. Freedom from bias

31

is attained when the criterion gives each respondent an equal opportunity. A reliable criterion is

stable or reproducible. Finally, information specified by the criterion should be available. (Cooper

and Schindler , 2003; Wells,1975).

TABLE 3.6: Summery of Internal Validity Methods

No. Type What is measured? Methods used

1 Content Validity Degree to which the content of

the items adequately represents

the universe of all relevant items

under study

Choice of relevant

dimensions from existing

literature

Researcher judgment

Panel evaluation

2 Construct

Validity

Attempts to identify the

underlying constructs being

measured and determine how

well the test represents them

Internal consistency

Factor Analysis

3 Criterion

Validity

Degree to which the predictor is

adequate in capturing the

relevant aspects of the criterion

Correlations

Multiple Regression

Reliability

Reliability of a scale measures how consistent or stable the ratings generated by the scale are

likely to be. Reliability focuses on whether the scale consistently measures the construct or not.

(Parashuraman, Grewal and Krishnan, 2007). Reliability is therefore concerned with the estimates

of the degree to which a measurement is free of random or unstable error. Reliable instruments

can be used with confidence that transient and situational factors do not interfere. Mathematically,

reliability is defined as the proportion of the variability in the responses to the survey that is the

result of differences in the respondents. That is, answers to a reliable survey will differ because

respondents have different opinions, not because the survey is confusing or has multiple

interpretations Reliable instruments are robust and; they work well at different times and under

different conditions. This distinction of time and condition is the basis for frequently used

32

perspectives on reliability: Stability, Equivalence and Internal consistency. While stability of a

scale measures the reliability whether consistent results can be secured with repeated measures of

the same person with the same instrument, equivalence is concerned with variations at one point

in time among observers and samples of items. Ideally, in order to obtain a good estimate of the

reliability of a survey, we would like to administer the survey twice to the same group of people

and then correlate the two sets of results. However, this is often impractical because bias may be

introduced in the second set of answers or because respondents may be unwilling or unable to

take the survey a second time. . One solution is to compute Cronbach's alpha (Cooper and

Schindler, 2006)

Cronbach's alpha is the most common form of internal consistency reliability coefficient.

Cronbach's alpha is a lower bound for the true reliability of the survey. Alpha equals zero when

the true score is not measured at all and there is only an error component. Alpha equals 1.0 when

all items measure only the true score and there is no error component. The computation of

Cronbach's alpha is based on the number of items on the survey and the ratio of the average inter-

item covariance to the average item variance. (Cooper and Schindler, 2006; Bryman and Bell,

2008)

Cronbach's alpha can be interpreted, as the percent of variance the observed scale would explain

in the hypothetical true scale composed of all possible items in the universe. Alternatively, it can

be interpreted as the correlation of the observed scale with all possible other scales measuring the

same thing and using the same number of items. (Cooper and Schindler,2006) By convention, a

lenient cut-off of .60 is common in exploratory research; alpha should be at least .70 or higher to

retain an item in an "adequate" scale; and many researchers require a cut-off of .80 for a "good

scale." (Hair et al)

3.4 Sample Design and Data Collection

The survey process was conducted in Bangalore since it is considered the silicon valley of the

country and since many IT companies have the Head office or major business centres there.

Since getting permission to conduct the survey was difficult, Convenience sampling a non-

probability sampling technique was applied. Attempt was made to include representation from

large, small and medium size IT organizations. Please find details of sample representation and

organization size in table 3.7. Majority of the companies interviewed were large firms. In each

organization the head of the human resources department or his representative was

interviewed. The various firms in that participated in this study are showcased in table 3.8.

33

Table 3.7: Sample size by size of the organization

Frequency Percent Valid Percent Cumulative

Percent

Valid

Small(<50 emp) 3 15.0 15.0 15.0

medium(50-500 emp) 5 25.0 25.0 40.0

Large (>500 emp) 12 60.0 60.0 100.0

Total 20 100.0 100.0

Table 3.8: Names of the companies and size of the organizations

Name of Company Size

Talent Bridge Small

Metor Labs Small

Adept Sys Small

Confidential Medium

Pinaka Tech Medium

Allied Medium

Ampersand Technologies Medium

Artera Systems Medium

Sap Large

Invensys Operations Management/ Invensys Skelta Large

Oracle Large

Dell Large

Accenture Large

IBM Large

TCS Large

Tech Mahindra Large

Confidential Large

HCL Large

iGate Large

SLK software Large

SAP Large

3.5 Statistical Analysis

Data were analyzed with the Statistical Package for Social Sciences (SPSS) version 20.0.

34

Descriptive statistics, bivariate analysis and multivariate analysis were adopted.

Descriptive

Descriptives have been used by studying means or frequencies to construct various chats

presented in the report

Factor Analysis

Principal component analysis with varimax rotation was used on the questionnaire items to reduce

the data. Principal component analysis is a model of factor analysis that considers total variance

and derives factors that include small proportions of unique variance. It is appropriate when the

primary concern is a minimum number of factors that are needed to account for maximum amount

of variance. Factor analysis is a generic name given to a class of multivariate statistical methods

whose primary function is to define underlying structure in the data matrix. With factor analysis,

the researcher can first identify the separate dimensions of the structure and then determine the

extent to which each variable is explained by each dimension. These dimensions or factors when

interpreted and understood describe the data in a much smaller number of concepts than the

original individual variables. Data reduction can be achieved by calculating scores for each

underlying dimension. (Hair et al, 2003)

To identify the optimum number of factors to be extracted two methods have been used. For the

data reduction, the latent root criterion was used. Only factors that having latent root greater than

one were considered for further analysis. (Hair et al, 2003) In case of multiple high loading, the

higher loaded item was considered.

ANOVA

The statistical method for testing null hypothesis that the means of several populations are equal

is analysis of variance. One-way analysis of variance uses a single factor, fixed effects model to

compare the effects of one treatment or factor on a continuous dependent variable. ANOVA uses

squared deviations of variance so that computations of distances of the individual data points

from their own mean or from the grand mean can be summed. In ANOVA the test statistic is the

F-value, which checks whether the variability attributable to the treatment exceeds variability

arising from random fluctuations. To test the Hypotheses, ANOVA was used to check for

significant differences between the three categories of interest i.e., the large, medium and small

35

size compaies. The degrees of freedom, F-value, p and the mean values for the factors of

importance of IHRM, adoption of iHRM, the reasons for iHRM and the outcome of iHRM have

been calculated for this purpose. Null hypothesis framed for the factors of all the variables were

rejected for p values less than the significance level .05 and conclude that there is statistically

significant differences between the segments. (Cooper and Schindler, 2006)

Paired sample T-test

The paired sample t-test (SPSS version 20.0) procedure compares the means of two variables for

a single group. It computes the differences between values of the two variables for each case and

tests whether the average differs from zero. The test is a technique used to test the hypotheses

that means are significantly different for the importance ascribed to iHRM and their perception of

their adoption (Cooper and Schindler, 2006).

Multiple regression

A multivariate analysis can further our understanding because we can simultaneously estimate the

relative impact of the independent variables on the dependent variable. Multiple regression

analysis is a statistical technique that can be used to analyze the relationship between a single

dependent variable and multiple predictor variables. The objective of the multiple regressions is

to use the independent variables whose values are known to predict the dependent variable. The

weights denote the relative contribution of the dependent variable to the overall prediction and

facilitate interpretation as to the influence of each variable in making the prediction. The set of

weighted independent variables forms the regression variate, the regression model or the

regression equation, a linear combination of independent variables that best predict the dependent

variable the weighted .The variables hypothesized to influence organizational commitment was

entered into the multiple regression analysis using the step wise method. The stepping method

criteria used the probability of F for entry as .05 and .10 for removal. The regression coefficients

and the model fit were estimated as well. (Hair et al, 2003).

36

CHAPTER 4

ANALYSIS and FINDINGS

4. Analysis and Findings

3.1 Description of the sample

The survey was conducted in Mumbai and Bengaluru as many of IT companies have their head

offices there. Majority of the companies interviewed were large firms(60%), followed by

medium sized companies (25%) and small companies (15%). In each organization the head of

the human resources department or his representative was interviewed.

Table 3.1: Sample size by size of the organization

Frequency Percent Valid Percent Cumulative

Percent

Valid

Small(<50 emp) 3 15.0 15.0 15.0

medium(50-500 emp) 5 25.0 25.0 40.0

Large (>500 emp) 12 60.0 60.0 100.0

Total 20 100.0 100.0

37

3.2 Need for innovation and areas of HR

Figure 3.1: Importance of innovation in various areas of HR

From the senior Human resource representatives the study attempted to understand the major

areas in the Human resource function in which they felt that innovation was necessary. The

data was collected on a likert scale. The mean value for the importance ascribed to each of the

areas is represented in figure 1. in a descending order. Employee Retention strategies were

considered the most crucial area in which innovative practices is required followed by Rewards

and Recognition, Compensation and incentives and employee retention strategies.

The areas which have been rated as least important for Indian IT companies while investing in

innovative practices are Knowledge management and CSR

38

Importance of iHRM and size of organization

Table3.2: Importance of iHRM and size of organization:

Mean Minimum Maximum

Employee Acquisition and

Retention strategies

Small(<50 emp) 4.8333 4.50 5.00

medium(50-500 emp) 4.8000 4.00 5.00

Large (>500 emp) 4.6250 2.50 5.00

Total 4.7000 2.50 5.00

Employee Performance

Management

Small(<50 emp) 4.2222 3.00 5.00

medium(50-500 emp) 4.5333 3.33 5.00

Large (>500 emp) 4.7778 4.00 5.00

Total 4.6333 3.00 5.00

Other HR initiatives

Small(<50 emp) 3.3000 1.60 5.00

medium(50-500 emp) 4.0800 2.80 4.80

Large (>500 emp) 4.2167 2.90 5.00

Total 4.0450 1.60 5.00

Table3.2.1: Importance of iHRM and size of organization:

Sum of Squares df Mean Square F Sig.


Retention strategies Between Groups .171 2 .085 .193 .826

Employee Performance

Management Between Groups .807 2 .404 1.176 .332

Other HR initiatives Between Groups 2.025 2 1.012 1.172 .334

Total 16.710 19

The areas important for innovation in HR practices were subject to factor analysis and the three

factors thus evolved used to compare between IT organizations of different sizes.

Ho: There is no significant difference between large, medium and small IT organizations in the

importance given to Employee acquisition and retention strategies, Employee performance

management strategies and other HR initiatives

Ha: There is significant difference between large, medium and small IT organizations in the

importance given to Employee acquisition and retention strategies, Employee performance

management strategies and other HR initiatives

39

Based on the results of the analysis of variance and the acceptance of the null hypothesis, it is

evident that there is no difference to the level of importance given to these initiatives by the

HR managers in IT organizations of different sizes

3.3 iHRM and its adoption in Indian IT organizations

The mean value for the extent to which the HR managers of IT companies felt that companies

have adopted iHRM ineach of the areas is represented in figure 3.2 in a descending order.

Figure 3.2: Extent to which Indian IT companies have adopted iHRM

Reward and Recognition strategies, compensation and incentives were considered the most

common areas in which innovative practices is adopted followed by employee acquisition

strategies and performance appraisal. The areas which have been rated as least prevalent are

Employee exit and separation management, welfare measures and knowledge management in

Indian IT companies

40

3.4 Importance ascribed to iHRM and extent of Adoption

Table 3.3: Importance ascribed to iHRM and extent of Adoption- Paired sample statistics

Paired Samples Statistics

Mean N Std. Deviation Std. Error Mean

Pair 1 Employee acquisition strategies (imp) 4.55 20 .887 .198

Employee acquisition strategies (adoption) 3.95 20 1.050 .235

Pair 2 Employee Retention strategies(imp) 4.85 20 .489 .109

Employee Retention strategies(adoption) 3.85 20 1.089 .244

Pair 3 Induction(imp) 3.90 20 1.165 .261

Induction(adoption) 3.45 20 .759 .170

Pair 4 Training and Development (imp) 4.25 20 .967 .216

Training and Development (adoption) 3.80 20 .834 .186

Pair 5 Leadership Development(imp) 4.45 20 .826 .185

Leadership Development(adoption) 3.60 20 1.046 .234

Pair 6 Career Planning(imp) 4.55 20 .759 .170

Career Planning(adoption) 3.65 20 1.040 .233

Pair 7 Performance appraisal(imp) 4.50 20 .688 .154

Performance appraisal(adoption) 3.90 20 .852 .191

Pair 8 Compensation and incentives(imp) 4.65 20 .671 .150

Compensation and incentives(adoption) 4.10 20 .788 .176

Pair 9 Rewards and recognition(imp) 4.75 20 .550 .123

Rewards and recognition (adoption) 4.10 20 .852 .191

Pair 10 Welfare measures(imp) 3.90 20 1.294 .289

Welfare measures(adoption) 2.90 20 1.021 .228

Pair 11 Organization Development(imp) 4.10 20 .968 .216

Organization Development(adoption) 3.10 20 .852 .191

Pair 12 Knowledge Management(imp) 3.70 20 1.129 .252

Knowledge Management (adoption) 2.95 20 .826 .185

Pair 13 HR strategy(imp) 4.30 20 .979 .219

HR strategy(adoption) 3.10 20 .912 .204

Pair 14 Employee exist and separation management(imp) 3.70 20 1.129 .252

Employee exist and separation management(adoption) 2.85 20 .933 .209

Pair 15 Corporate social responsibility(imp) 3.60 20 1.429 .320

Corporate social responsibility(adoption) 3.20 20 .951 .213

Table 3.3.1: Importance ascribed to iHRM and extent of Adoption(paired sample t-test

t df Sig.

Pair 1 Employee acquisition strategies (Imp) - Employee acquisition

strategies(adoption) 2.449 19 .024

Pair 2 Employee Retention strategies(Imp) - Employee Retention strategies(adoption) 3.684 19 .002

Pair 3 Induction(Imp) - Induction(adoption) 1.528 19 .143

Pair 4 Training and Development (Imp) - Training and Development(adoption) 1.484 19 .154

Pair 5 Leadership Development(Imp) - Leadership Development(adoption) 2.819 19 .011

41

Pair 6 Career Planning (Imp) - Career Planning(adoption) 3.327 19 .004

Pair 7 Performance appraisal (Imp) - Performance appraisal(adoption) 2.565 19 .019

Pair 8 Compensation and incentives(Imp) - Compensation and incentives (adoption) 2.773 19 .012

Pair 9 Rewards and recognition's (Imp) - Rewards and recognition (adoption) 2.942 19 .008

Pair 10 Welfare measures (Imp) - Welfare measures(adoption) 3.343 19 .003

Pair 11 Organization Development(Imp) - Organization Development(adoption) 4.359 19 .000

Pair 12 Knowledge Management (Imp) - Knowledge Management(adoption) 2.881 19 .010

Pair 13 HR strategy (Imp) - HR strategy(adoption) 3.835 19 .001

Pair 14 Employee exist and separation management (Imp) - Employee exist and

separation management(adoption) 2.819 19 .011

Pair 15 Corporate social responsibility (Imp) - Corporate social responsibility(adoption) 1.035 19 .314

Ho: There is no significant difference between the importance ascribed to iHRM and the extent

of adoption of iHRM in the Indian IT Industry

Ha: There is significant difference between the importance ascribed to iHRM and the extent of

adoption of iHRM in the Indian IT Industry

Based on the paired sample t-test, it is evident that iHRM practices match up to the

expectations of the HR managers or the importance given to it only in the case of practices

associated with induction, training and development and corporate social responsibility.

Adoption of iHRM and size of organizations

The areas adoption for innovation in HR practices of the Indian IT industry were subject to

factor analysis and the three factors thus evolved were used to compare between IT

organizations of different sizes.


adoption of Employee acquisition and reward strategies, Employee growth management

strategies and other HR initiatives


adoption of Employee acquisition and reward strategies, Employee growth management

strategies and other HR initiatives


evident that there is no difference adoption of these initiatives by the HR managers in IT

organizations of different sizes.

42

Table3.4: Adoption of iHRM and size of organizations -Descriptives


Employee Acquisition and Reward

Small(<50 emp) 3.8667 2.20 5.00

medium(50-500 emp) 4.1200 3.00 4.80

Large (>500 emp) 3.9500 3.00 5.00

Total 3.9800 2.20 5.00

Employee Growth Management

Small(<50 emp) 3.2500 2.00 4.00

medium(50-500 emp) 3.6500 2.75 4.75

Large (>500 emp) 3.7083 3.00 5.00

Total 3.6250 2.00 5.00

Other HR initiatives

Small(<50 emp) 3.2222 2.50 4.00

medium(50-500 emp) 2.4000 2.00 2.67

Large (>500 emp) 3.2222 2.17 4.83

Total 3.0167 2.00 4.83

Table3.4.1: Adoption of iHRM and size of organizations -ANOVA



Reward Between Groups .147 2 .074 .099 .906

Employee Growth Management Between Groups .508 2 .254 .370 .696

Other HR initiatives Between Groups 2.535 2 1.268 2.564 .106

Total 10.939 19

3.5 iHRM strategies in selected HR functions

Attempt was made to understand the extent of iHRM practices in select areas.

Employee acquisition strategies

43

Figure 3.3: Employee acquisition strategies

In the case of Employee acquisition strategies 90% companies use “Referral bonus”, 80% use

the social media and 85 % claim to have industry academia initiatives in place. But only 15%

of the companies have initiated “second career initiatives”.

Rewards and Recognitions

Figure 3.4: Rewards and Recognition strategies

90% of the organizations suveyed believed in a blend of Financial and non financial awards

and performance linked incentives. And a majority of them (95%) gave “Best Employee

wards“ to motivate the good performaers. But only 50% companies think it wise to give cash

awards for extraordinary performance.

44

Welfare measures

While 80% of the surveyed companies allowed their employees to practice “virtual working”,

when this was needed, only 20% of them have any child /elder care program in place. Most of

the organizations (55%)also admitted that they do not have any benefits directed at the

employee’s families. But 70% of them offer their employees recreational facilities on-site or

through tie-ups. 75% of them also focus on long term benefits for their employees through

alternative insurance and health management systems.

Figure 3.5: Welfare measures

3.6 Reasons/Influence on iHRM The main motivation for organizations to adopt iHRM is to remain competitive in the market

according to the HR managers interviewed in this study. Moreover the external environmental

factors including competition and the customers compel organization to incorporate innovate

practices. The other major reasons include attempt to provide a satisfying work environment,

Top management insistence, already inculcated organizational culture and structural

characteristics.

45

Figure 3.6: Major reasons or influences on iHRM

Table 3.5: Major reasons or influences on iHRM and size of organization-Descriptives


Environment and Top mgt

influence

Small(<50 emp) 4.6667 4.00 5.00

medium(50-500 emp) 4.2000 3.00 5.00

Large (>500 emp) 4.4167 3.33 5.00

Total 4.4000 3.00 5.00

To provide relevant HR service in

the System

Small(<50 emp) 17.3333 13.00 25.00

medium(50-500 emp) 16.8000 15.00 19.00

Large (>500 emp) 20.0000 16.00 25.00

Total 18.8000 13.00 25.00

To provide Strategic advantages

through HR

Small(<50 emp) 3.6667 2.75 4.75

medium(50-500 emp) 3.2500 2.50 4.25

Large (>500 emp) 3.6250 3.00 5.00

Total 3.5375 2.50 5.00

46

Table 3.5.1: Major reasons or influences on iHRM and size of organization-ANOVA


Environment and Top mgt

influence Between Groups .417 2 .208 .555 .584

To provide relevant HR service

in the System Between Groups 43.733 2 21.867 1.983 .168

To provide Strategic advantages

through HR

Between Groups .555 2 .278 .548 .588

Total 9.159 19

The reasons or influence on iHRM practices of the Indian IT industry were subject to factor

analysis and the three factors thus evolved were used to compare between IT organizations of

different sizes.

Ho: There is no significant difference between large, medium and small IT organizations in

their reasons/influences for adopting iHRM

Ha: There is significant difference between large, medium and small IT organizations in their

reasons/influences for adopting iHRM


evident that there is no difference the reasons/influences for adoption of iHRM according to

HR managers in IT organizations of different sizes.

3.7 Impact of iHRM practices

The respondents were very positive about the impact of innovative practices in HRM. They

said that the most visible impact is on the ability of the organization to attact and retain talent.

This first may also be because of the increased employee satisfaction which is also a outcome

of iHRM. The third area in which the impact of iHRM can be felt is Employee productivity.

Other areas in which the managers felt that iHRM practices can have apositive effect are:

Employee attitude and Behavior, Sales growth and People orientation of the management.

While ROI , market share and customer satisfaction are according to them positively impacted

47

too. These have been rated the least since these iHRM may not have a direct or immediate

impact on these.

Figure 3.7:Outcomes of iHRM practices

3.8 Organizational commitment and iHRM

But in spite of this belief that iHRM is useful for attracting employees to the organization and

keeping them happy, these HR managers feel that organizational commitment is low in their

industry.

48

Figure 3.8: Circumstances in which employees will leave (1-very likely…5-very unlikely)

They feel that even with some of the efforts being made by the industry to bring in innovative

HR practices, employees would leave if the completion offers 25% hike in salary or if more

status were offered. It is also quite common in the industry for people to shift organizations in

the event of opportunities for creative freedom or opportunity to work with friendlier people.

3.9 Importance of iHRM for organizational commitment

In order to understand which among the various iHRM activities is a good predictor of

organizational commitment an multiple regression using the step wise method was used. The

results indicate that iHRM is most crucial in Performance Appraisal measures to ensure

organizational commitment of employees. With an adjusted Rsquare value of .462, a significant

F value and t value, the analysis chose performance appraisal measures as the one variable that

affects organizational commitment.

Table 3.6: Importance of iHRM and organizational commitment: Regression analysis

Table 3.6.1 Model Summary

Model R R Square Adjusted R

Square

Std. Error of the

Estimate

1 .700a .490 .462 .52071

a. Predictors: (Constant), Performance appraisal

Table 3.6.2 ANOVAa

Model Sum of Squares df Mean Square F Sig.

1

Regression 4.694 1 4.694 17.314 .001b

Residual 4.881 18 .271

Total 9.575 19

a. Dependent Variable: Organizational commitment

b. Predictors: (Constant), Performance appraisal

Table 3.6.3 Coefficientsa

Model Unstandardized Coefficients Standardized

Coefficients

t Sig.

B Std. Error Beta

1 (Constant) 5.050 .790 6.395 .000

Performance appraisal -.722 .174 -.700 -4.161 .001

a. Dependent Variable: Organizational commitment

49

3.10 Organizational commitment and organizational size

Table 3.7: Organizational commitment and organizational size-Descriptives


Small(<50 emp) 2.4167 1.50 3.75

medium(50-500 emp) 1.6500 1.00 2.25

Large (>500 emp) 1.7083 1.00 3.00

Total 1.8000 1.00 3.75

Table 3.7.1: Organizational commitment and organizational size-ANOVA


Between Groups 1.354 2 .677 1.400 .274

Total 9.575 19

In order to test whether organizational commitment differed between organizations of different

sizes, and ANOVA was used.


organizational commitment of employees

Ha: There is significant difference between large, medium and small IT organizations in

organizations in the organizational commitment of employees


evident that there is no difference in the organizational commitment of employees according to

HR managers in IT organizations of different sizes.

3.11 Outcomes of iHRM and size of the organizations

The outcome variables for iHRM for the Indian IT industry were subject to factor analysis and

the three factors thus evolved were used to compare between IT organizations of different

sizes.


outcomes of iHRM including Macro-organizational effectiveness, micro-organizational

effectiveness, ability to attract talent and overall organizational effectiveness

50


outcomes of iHRM including Marco-organizational effectiveness, micro-organizational

effectiveness, ability to attract talent and overall organizational effectiveness


evident that there is no difference organizational effectiveness at a macro level, overall or in

the ability to attract talent outcome of iHRM according to HR managers in IT organizations of

different sizes. But at a micro level organization effectiveness variable, the data indicates

significant difference. An examination of the mean values shows that the impact of the iHRM

initiatives is significantly higher for larger organizations than for smaller ones. To clarify this

further, the data was subject to a Duncan test. The results indicate that along the variable

impact of organizational effectiveness at the micro level, the smaller firms are similar t the

medium sized firms but larger firms have higher impact.

Table 3.8: Organizational effectiveness and organization size- Descriptives


Organizational Effectiveness-

Macro

Small(<50 emp) 4.0833 3.25 5.00

medium(50-500 emp) 3.7000 3.00 4.25

Large (>500 emp) 3.9792 2.25 5.00

Total 3.9250 2.25 5.00


Micro

Small(<50 emp) 4.6667 4.50 5.00

medium(50-500 emp) 4.5000 3.50 5.25

Large (>500 emp) 5.6667 4.00 6.25

Total 5.2250 3.50 6.25

Ability to attract talent

Small(<50 emp) 4.6667 4.00 5.00

medium(50-500 emp) 4.8000 4.00 5.00

Large (>500 emp) 4.7500 4.00 5.00

Total 4.7500 4.00 5.00

Overall organizational

effectiveness

Small(<50 emp) 3.9667 3.60 4.40

medium(50-500 emp) 3.7600 3.30 4.30

Large (>500 emp) 4.3333 3.00 5.00

Total 4.1350 3.00 5.00

51

Table 3.8: Organizational effectiveness and organization size- Descriptives ANOVA


Organizational Effictiveness-

Macro

Between Groups .364 2 .182 .231 .796

Within Groups 13.399 17 .788

Total 13.763 19


Micro

Between Groups 5.904 2 2.952 7.771 .004


Total 12.363 19

Ability to attract talent

Between Groups .033 2 .017 .076 .927


Total 3.750 19

Overall organizational

effectiveness

Between Groups 1.260 2 .630 2.011 .164


Total 6.585 19

Table 3.8.2: Organizational effectiveness (Organizational Effectiveness-Micro ) and organization

size- Duncan test

Size of the organization N Subset for alpha = 0.05

1 2

medium(50-500 emp) 5 4.5000

Small(<50 emp) 3 4.6667

Large (>500 emp) 12 5.6667

Sig. .679 1.000

Means for groups in homogeneous subsets are displayed.

a. Uses Harmonic Mean Sample Size = 4.865.

b. The group sizes are unequal. The harmonic mean of the group sizes is

used. Type I error levels are not guaranteed.

52

CHAPTER 5

Discussion, Recommendations and Conclusion

5. Discussion, Recommendations and Conclusion

Information Technology Industry in India has come of age and the competition between the various

players have intensified. The main resource based on which IT companies define their core competencies

have always been “manpower”. Therefore attracting capable employees, developing them in the

organization, retaining them and maintaining the knowledge they crate is a major strategic objective for all

the organizations in the sector.

To do so the Human resource departments in these companies has had to evolve and take on a more

relevant role in the organization. With the top management support, the HR function in IT organizations

has taken to the new challenges posed by the business environment by bringing in innovation in the

Human Resource practices.

While trade papers intermittently record these efforts, research efforts have not been hither to undertaken

to understand the extent and impact of iHRM practices in India especially in the Information technology

context. Therefore this study attempts to understand:-he extent to which HR managers believe that

innovation in HR practices are important for achieving goals of the organization, the major areas in which

innovation is required, the extent to which Indian companies have succeeded in inculcating innovative HR

practices, the major influences on the kind of HRM innovations adopted by Indian IT organization,

and the important outcomes of innovation in HR practices with reference to organizational commitment

and performance

In order to do so, HR managers at twenty large, medium and small IT companies were interviewed in the

city of Mumbai with head quarters in Bengaluru.. The data collection instrument was tested for reliability

and validity before proceeding. The data thus collected was subjected to empirical analysis using

descriptive analysis, Factor analysis and Analysis of variance.

The results of the study indicate that HR mangers agree that including innovative HR practices is

extremely important especially in the process of attracting and rewarding employees which are

two of the largest challenges they face. Of all the major areas in which the function oversees,

Employee Retention strategies were considered the most crucial area in which innovative

practices is required followed by Rewards and Recognition, Compensation and incentives and

53

employee retention strategies. The areas which have they been rated as least important for Indian

IT companies while investing in innovative practices are Knowledge management and CSR

The areas in which these mangers are currently seeing extensive use of iHRM practices include

the Compensation, Rewards and Employee acquisition strategies. In Employee acquisition use of

referral bonus and the social media is increasingly common while in use of a blend of financial

and non-financial rewards in addition to “Best employee” ect. is finding more takers. Virtual

working has also become increasingly acceptable to organizations if it means that they can retain

talent.

The main motivation for organizations to adopt iHRM is to remain competitive in the market

according to the HR managers interviewed in this study. Moreover the external environmental

factors including competition and the customers compel organization to incorporate innovate

practices. The other major reasons include attempt to provide a satisfying work environment, Top

management insistence, already inculcated organizational culture and structural characteristics.

The respondents were very positive about the impact of innovative practices in HRM. They said

that the most visible impact is on the ability of the organization to attact and retain talent. This

first may also be because of the increased employee satisfaction which is also a outcome of

iHRM. The third area in which the impact of iHRM can be felt is Employee productivity. Other

areas in which the managers felt that iHRM practices can have apositive effect are: Employee

attitude and Behavior, Sales growth and People orientation of the management. While ROI,

market share and customer satisfaction are according to them positively impacted too. These have

been rated the least since these iHRM may not have a direct or immediate impact on these.

An organization investing in iHRM naturally would do so only if the outcomes gave them

strategic advantages. These innovative practices according to HR mangers of these companies

help organizations to remain competitive in the job market; moreover their clients also audit them

to ensure that their HR practices as per acceptable international standards. With these and the

employee satisfaction in view, top managements have also been pushing their HR departments to

bring in innovative HR strategies. But at the same time it’s interesting to note that the impact of

the iHRM initiatives is significantly higher for larger organizations than for smaller ones. In

Impact of organizational effectiveness at the micro level including Employee satisfaction,

employee productivity, attitude and behavior and on people orientation of the management, the

54

smaller firms are similar to the medium sized firms but larger firms have higher impact. This may

be because the larger firms are able to implement these initiatives more fully and have the costs

spread over a larger group of people.

But the bad news is that these HR managers feel that in spite of the efforts the industry is making,

the employee commitment levels are low and they will shift for higher pay or status. Solving this

issue is the holy grail as far as HR managers are concerned. It is well known that when employees

are committed to their employer, they will deliver higher levels of performance. Highly

committed employees can also help an organization achieve much more each year than employees

with average or low commitment.

IT Organizations can use different innovative HR and leadership strategies to increase the level of

commitment of their employees. For this it’s important that the iHRM practices are tailored to

induvidual workplace culture and objectives of the companies. This begins with recruitment.

Hiring well-qualified employees who match clearly-defined job descriptions is important. Induct

them successfully into the organizational culture is also important.

Since in the IT industry it is quite prevalent to find employees shift for larger packages its

important to hold people within in its culture through informal bonding as well. While this brings

with it the fear of large chunks of an organization together, this occurrence is rare. Initiatives to

build the teams into cohesive wholes have to be initiated by HR. It seems likely that, as

employees become more embedded in a social identity, changing organizations would become

less attractive.

It is also important to develop employees as assets by giving them increasingly challenging tasks,

allowing them to become more influential and derive intrinsic benefits. Effort could also be made

to keep an ongoing dialog with employees to understand what motivates them and adjust their

development plans to help them achieve their goals inside the organization. Therefore one of the

goals of iHRM has to be to move decision making rights from mangers to lower levels. This will

help make decisions by tapping into a much larger knowledge base and simultaneously develop

problem solving skills down the line.

It is also important that firms stay committed to iHRM practices though it may not show

immediate visible results. There is increasing body of evidence that iHRM improves employee

55

productivity. But the advantages of using iHRM practices can go beyond employee productivity

and performance. An emotionally committed employee is a loyal employee.

56

CHAPTER 6

Limitations and Future Scope

6. Limitations and Future Scope

This study is limited in many ways:

1. Sample size: While attempt was made to include different kinds of IT companies in

the sample, the generalizability of the study is limited by the fact that it has used a

small sample

2. Data collection: The data for the study has been collected from Mumbai but other

cities like Hyderabad, Thiruvanthapuram, Pune etc. have also become established IT

hubs. Future studies can cover HR mangers in firms in these cities.

3. Cross Sectional study: While a cross sectional study has its uses, it would be ideal to

garner better depth of information on the topic if the study could access longitudinal

data gathered from deep within the firms over a period of time.

4. Analytical tools used: Normal distribution of data has been assumed for data

analysis. Further the Bartlett test was used to check ensure the applicability of

techniques like factor analysis but ideally a larger sample would be suited to conduct

these tests

Future studies should look at larger samples in terms of larger participation of IT managers

and larger participation of IT companies. Attempt can also be made to look at differences

between different companies and different sub-divisions like IT and ITES or companies that

cater to the US markets vis-à-vis the European or the other markets in differences in

adoption. While this study indicates that the size of the organization in itself has limited

impact a more detailed study into actual practices instead of the reports by the IT managers

would give better insights.

57

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60

Annexure :EXHIBIT 1

Questionnaire for

Study on “Innovative HR practices in the IT Industry: An empirical study”

Dear HR manager,

This survey on innovative Human Resource practices is a study undertaken by Prof. Mrs.

B.V.Murty, Vivekanand Education Society's College of Arts, Science and Commerce, Mumbai,

as part of an academic research project. Kindly give ten minutes of your time to answer the

following questions. It will be much appreciated. Thank you

1. In which of the following areas in Human Resource Management is it important for

an organization in the IT business to innovate continuously? Please rate on the five

point scale wherein 1- Completely unimportant…………….. 5-extremely important

a) Employee acquisition strategies

1. Completely unimportant

2. Unimportant

3. Neither

4. Important

5. Extremely important

b) Employee Retention strategies


2. Unimportant

3. Neither

4. Important


c) Induction


2. Unimportant

3. Neither

61

4. Important


d) Training and Development


2. Unimportant

3. Neither

4. Important


e) Leadership Development


2. Unimportant

3. Neither

4. Important


f) Career Planning


2. Unimportant

3. Neither

4. Important


g) Performance appraisal


2. Unimportant

3. Neither

4. Important


h) Compensation and incentives


2. Unimportant

62

3. Neither

4. Important


i) Rewards and recognitions


2. Unimportant

3. Neither

4. Important


j) Welfare measures


2. Unimportant

3. Neither

4. Important


k) Organization Development


2. Unimportant

3. Neither

4. Important


l) Knowledge Management


2. Unimportant

3. Neither

4. Important


m) HR strategy


63

2. Unimportant

3. Neither

4. Important


n) Employee exist and separation management


2. Unimportant

3. Neither

4. Important


o) Corporate social responsibility


2. Unimportant

3. Neither

4. Important


p) Others (pls specify)


2. Unimportant

3. Neither

4. Important


2. Rate the following areas based on your agreement regarding the extent to which

Indian IT organizations have adopted innovation in their HR practices. Please rate on

the five point scale wherein 5-completely agree…….…. 1-completely disagree

a) Employee acquisition strategies


2. Unimportant

3. Neither

4. Important

64


b) Employee Retention strategies


2. Unimportant

3. Neither

4. Important


c) Induction


2. Unimportant

3. Neither

4. Important


d) Training and Development


2. Unimportant

3. Neither

4. Important


e) Leadership Development


2. Unimportant

3. Neither

4. Important


f) Career Planning


2. Unimportant

3. Neither

65

4. Important


g) Performance appraisal


2. Unimportant

3. Neither

4. Important


h) Compensation and incentives


2. Unimportant

3. Neither

4. Important


i) Rewards and recognitions


2. Unimportant

3. Neither

4. Important


j) Welfare measures


2. Unimportant

3. Neither

4. Important


k) Organization Development


2. Unimportant

66

3. Neither

4. Important


l)Knowledge Management


2. Unimportant

3. Neither

4. Important


m) HR strategy


2. Unimportant

3. Neither

4. Important


n) Employee exist and separation management


2. Unimportant

3. Neither

4. Important


o) Corporate social responsibility


2. Unimportant

3. Neither

4. Important


p) Others (pls specify)


67

2. Unimportant

3. Neither

4. Important


3. Rate the following based on what you believe are the major reasons for/ influences on

the kind of HRM innovations adopted by Indian IT organizations? Please rate on the

five point scale wherein 5-completely agree …. 1-completely disagree

a) External environmental forces

1. Completely disagree

2. Disagree

3. Neither

4. Agree

5. Completely agree

b) Organizational Structural Characteristics


2. Disagree

3. Neither

4. Agree

5. Completely agree

c) Organizational culture


2. Disagree

3. Neither

4. Agree

5. Completely agree

d) History of success with past HRM innovations


2. Disagree

3. Neither

4. Agree

68

5. Completely agree

e) Influence of consultants


2. Disagree

3. Neither

4. Agree

5. Completely agree

f) Top management insistence


2. Disagree

3. Neither

4. Agree

5. Completely agree

g) To remain competitive in the industry


2. Disagree

3. Neither

4. Agree

5. Completely agree

a) Quest for continuous improvement in HR M


2. Disagree

3. Neither

4. Agree

5. Completely agree

b) To reduce costs of HRM Services


2. Disagree

3. Neither

69

4. Agree

5. Completely agree

c) To increase services of HRM department


2. Disagree

3. Neither

4. Agree

5. Completely agree

d) To increase impact of HRM department


2. Disagree

3. Neither

4. Agree

5. Completely agree

e) To provide more satisfying work experience to the employees


2. Disagree

3. Neither

4. Agree

5. Completely agree

f) Others (pls specify)


2. Disagree

3. Neither

4. Agree

5. Completely agree

4. Rate the likelihood of the following to be true for employees in an organization which

is considered “innovative”vis-a-vis “traditional” its HR practices by the industry

wherein 1- very likely and 5-very unlikely

70

Employees would be willing to change companies if the new job offered:

A. 25% pay increase

1. Very likely

2. Likely

3. Neither

4. Unlikely

5. Very unlikely

B. More creative freedom

1. Very likely

2. Likely

3. Neither

4. Unlikely

5. Very unlikely

C. More status

1. Very likely

2. Likely

3. Neither

4. Unlikely

5. Very unlikely

D. Opportunity to work with friendlier people

1. Very likely

2. Likely

3. Neither

4. Unlikely

5. Very unlikely

5. Rate to what extend the following will be positively impacted by innovations in HR

wherein 1-completely disagree …………………..5-Completely agree

a) Sales Growth


71

2. Disagree

3. Neither

4. Agree

5. Completely agree

b) Profitability within Industry


2. Disagree

3. Neither

4. Agree

5. Completely agree

c) Market Share within Industry


2. Disagree

3. Neither

4. Agree

5. Completely agree

d) ROI


2. Disagree

3. Neither

4. Agree

5. Completely agree

e) People orientation of the management philosophy


2. Disagree

3. Neither

4. Agree

5. Completely agree

f) Employee attitude and behavior

72

g) Completely disagree

h) Disagree

i) Neither

j) Agree

k) Completely agree

l) Employee Productivity


2. Disagree

3. Neither

4. Agree

5. Completely agree

Employee Satisfaction


2. Disagree

3. Neither

4. Agree

5. Completely agree

m) Customer satisfaction


2. Disagree

3. Neither

4. Agree

5. Completely agree

n) Ability to attract and retain talent


2. Disagree

3. Neither

4. Agree

5. Completely agree

73

o) Contribution to society


2. Disagree

3. Neither

4. Agree

5. Completely agree

6. Kindly indicate which of the following are implemented by your organization in area of

Employee acquisition strategies (Please tick ( √ )all that is applicable)

a. Social media utilization

b. Second career internship

c. Referral bonus

d. Industry academia interface

e. Others (pls specify)………………………………………………………………………...


Rewards and recognitions (Please tick ( √ )all that is applicable)

a. Performance linked awards

b. Cash awards for extra ordinary performance

c. Best employee awards

d. Blend of financial and non-financial awards

e. Others (pls specify)………………………………………………………………………...


Welfare Measures (Please tick ( √ )all that is applicable)

a. Focus on long term benefits for employees through alternative insurance and health

management systems

b. Benefits directed at employees families

74

c. Recreational facilities

d. Child/elder care programs

e. Virtual working

Others (pls specify)………………………………………………………………………...

9. Kindly discuss any other innovative HR practices that your company has initiated

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9. Name of the organization: ……………………………………………………………………

10. Size of the organization:

a. Small (less than 50 employees)

b. medium(51- 500 employees)

c. Large (More than 500 employees)

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