What’s common to these firms?
The largest airline in the United States by number of passengers carried domestically per year.
“To Provide the Best Customer Service, Put your Employees First.” - Colleen Barrett, President
The largest coffeehouse company in the world, with 15,012 stores in 44 countries.
“We built the Starbucks brand with our people, not with consumers. Because the best way to meet and exceed consumer expectations was to hire and train great people. We invested in employees.” - Howard Schultz, Chairman
A privately held Fortune 500 Company that provides various services to residences and firms.
“It is not just what we are doing but what we are becoming in the process that gives us our distinct value.” - William Pollard, Chairman
Guarantees Made to HCL Employees
• We will not give you responsibilities
• We will not respect your aptitude
• We will not treat you equally
Guarantees HCL to Employees
• We will not give you responsibilities
– You will have to take responsibilities
• We will not respect your aptitude
– We will respect your attitude• We will not treat you equally
– We will treat you fairly
Stepping back in TimeSTATE OF BUSINESS IN 2005
State of Business - Assessment of 2005
Employees
HCL Leadership Shareholders
Competition
Customers
2005
Traditional outsourcers extending focus from cost to innovation, productivity, resilience and flexibility
New generation outsourcers looking for transformational gain
Disruptive technologies and new business models
The “Me too” phenomenon and the need to differentiate
The value volume conundrum – linear extension of business model largely through application business
Increased revenue growth rate and profitability to be in line with peers
Strong aspiration quotient to be leaders in the service space
Employee driven market conditions Recruitment, engagement and attrition
needed new approaches
The Big Change
HCL TRANSFORMATION
Four basic questions
1. How do you differentiate in today’s world
• By adding value2. Who adds Value?• Employees3. Where do they add value?• Value Zone – the interface between
the Service provider & Customer
4. If Employees add the ultimate value..
What should the role of management be?
Enable, Engage & Empower
employees
How the business runsEngagement
EmpowermentOwners of change
How the business runsEngagement
EmpowermentOwners of change
New ProductsNew Propositions
New Markets
New ProductsNew Propositions
New Markets
Cycle of Transformation
Implementation Challenge
Vision, Mission & Values
Change Management
Implementation
“What” of strategy “How” of strategy
What Changed in HCL
From
Output /Outcome Focus
Output /Outcome Focus
Effort andInput Focus
Effort andInput Focus
To
From
IntegratedServices
IntegratedServices
DiscreteServices
DiscreteServices
To
-4-
From
New ServicesNew Services
Traditional ADM Services
Traditional ADM Services
To
From
Global & Indian IT competition
Global & Indian IT competition
Indian IT competition
Indian IT competition
To
From
Individual Identity
Individual Identity
Factory approach
Factory approach
To
From
Empowerment and Enrichment
Empowerment and Enrichment
AspirationAspiration
To
C U
S T
O M
E R
C O
M P
E T
I T
I O N
E M
P L
O Y
E E
L E
A D
E R
S H
I P
Departing from Traditional Leadership Model
Customer
Employee
Enabling Function
Management
The Value Zone
Customers
Employees
Why Employees First ?
Employees First Enables, Engages and Empowers employees to maximize the value by creating the WOW in the value zone
Customer
Employee
Enabling Function
Management
The Value ZoneMaximizing the WOW in the value zone
In a knowledge intensive industry, value gets created in the interface between the customer and the employee
EFCS is about the individuals, their individuality and their diversity
EFCS is not……
What is Employees First
Employees First is a philosophy that recognizes employees as strategic to the ownership of the companies functions and its way of working.
The tenets of Employees First
Mirror, Mirror…
1
Accepting imperfections as catalysts for transformation
Trust through Transparency
2
Seeding trust by stretching the envelope of transparency
Inverted Pyramid
3
Reversing accountability by bringing the bottom to the top
Recasting the role of the CEO
4
Decentralizing decision making
EFCS….inspiring change
Our Approach-achieving EFCS @ HCL
The U&I Portal
U&I, is an online forum was formed to bring a new level of transparency in the
organization. Employees can post any question, which the CEO, along with his
Leadership team, would answer. Stretching the envelope of transparency, it gives a
voice to all its employees and ensures that it is heard.
Transferring CEO’s Responsibility
To strengthen the Concept of EFCS further a new section called “MY
PROBLEMS” was introduced in the U&I portal where the CEO shares a
problem faced by him with the employees who then respond with
unique/innovative ways to deal with it.
Employee Passion Indicative CountEPIC
HCL’s top five Passion Indicators
Customer support Collaboration Planning & Organizing
Creativity Interest
Passion being the essence of an “HCL-ite”, EPIC was designed with the aim
of enabling the individual measure and identify his/her passion drivers which
would eventually assist him/her in utilizing those identified passion drivers in
their jobs, thereby, increasing productivity and satisfaction.
Open 360 Degree Feedback
360 Degree Feedback, Employees can rate their managers, even the CEO, and the feedback/rating is made public across the organization. This inverts the pyramid and makes the employee a part of the development journey of the manager and the CEO.
Smart Service Desk (SSD )
Smart Service Desk 2.0, an online problem management system to resolve issues that employee face with the enabling functions. Only employees can close these tickets, if satisfied. This brings in a culture of reverse accountability.
Value Portal
Value Portal, is about incorporating the efforts of every employee into a business strategy that will support performance and profits over the long haul. It requires each member of a team to take ownership of the organizational assets he or she manages and translate organizational strategy into a personal plan of action.
But does EFCS Really work?
In 2005 HCL ,
18000 Employees $ 700 Mn in Revenues
CAGR of 30 % Operations in 18 Countries
79,000 Employees $ 5.7 Bn in Revenues
CAGR of 30 % Operations in 31 Countries
In 2011 HCL ,
Proof of the Experiment
EFCS: Impact Across The Organization
Evidence of BUSINESS SUCCESS:
Evidence of CUSTOMER IMPACT
Evidence of PEOPLE SUCCESS:•HCL has grown by 3.3 times in terms of employees from 18,000 employees in 2005 to 79,000 in 2011.•Won awards and accolades, e.g. Hewitt No 1 Best Employer in India and amongst the Top 25 Best Employers in Asia, one of Britain’s top employers 4th year in a row, one of the 44 most democratic workplaces in the world by WorldBlu.
Proof of the Experiment:•In 2009, during recession, HCL grew +23.5% while most of its competitior de-grew to the extent of -11.8%.
In a survey done by Forrester (external organization) among clients served by multi vendors, HCL has been voted as No.1 by its customer in application outsourced
Transformational Impact Created by EFCS
HCL- Large Pharma Relationship Growth Pattern
IS EMEA - HCM Support
ESS – Multiple Application Support
Short listed - Global Vendor
MRL Testing IS AP – Payroll
support
EAI – TIBCO GHH IS - MSI
Packaging MRL- CDS
support, CALM, Partnernet
GHH - M&O MSD Thailand –
DW Integration IS AP –PS HCM IS EMEA
RIS- CDS,CGA support, ADF,CBT
INFRA support First in Man
Research Managed care Process Consulting MMD Data 3
support SAS support Business
Intelligence Ent Architecture-
METIS App Rationalization
Strategy MSD Singapore Volume Deal MSD EMEA PDA SFA DBA support
GTS – Comet 2.0 EMEA - Portfolio
Mgmt/Univadis Portal Mgmt
HH – CDB, Email Marketing Campaign, DAY & FAST support
HH Banyu ISS – Production
support Infra – DC Tracks,
IBM AS400 , Preclinical M&O PTP BPO services MRL- Integration
Program Mgmt GDS support PS enhancements Web eVoc
GTS – Univadis Directory services EIC, One Large Pharma portal
Solution manager & Global Banking
MMD M&O MRL App Dev FACTS DSS BI
Migration ECCM Search
Technical Architect ISM Framework
Creation Infra GSOC MGCS Project Large Pharma BI
Support EMEA M&O ETL Portal
Development (PR1909312)
Large Pharma HH Siebel Call Center
MMD EA OSI PI Support
MMD Handel M&O MMD IT Quality
portal
GDAM_Integration Infosec_Sustenance
Engg GSHardware_Apps HPC Support Large Pharma HPC
MRL DBA MRL_BasicResearch
&Licensing_M&O Large Pharma O2C SAP Htr Support SM SOP Creation
Phase Data Centre
Consolidation
Team Size 1075
Team Size34
Team Size 450
Team Size 700
Team Size 790
Team Size 225
2005
2006
2007
2008
20092010
Key Performance Parameters
Resource MixService Quality
CSAT KEY HIGHLIGHTS
HCL CARES C SAT Rating of 6.2 on a 7 point scale for Nov 2010
Value Dashboard (2010)
Value Scorecard - for December2010
Total Ideas generated 18
Total Value of Ideas $469,528
Large Pharma Accepted Ideas 17
Value of Large Pharma Accepted ideas $464,596
Ideas completed/realized 14
Value of completed idea $432,912
Division Wise Idea Split
Idea/Value Split across different areas
Service Maturity Map
• Integrated Service Management
• Discrete Managed Services
• Project –based
• Transactional
Maturity^
SLA
Pricing Model
Productivity (YoY)
Big Pharma Role
Dependency
Cost Savings
Key Metrics
Transactional
No SLA for Vendor
T&M
NA
All M&O
People
Baseline: Labor Arbitrage
Attrition, On-boarding
Project Based
SLA for provider Box
Fixed/Rate Card
0-5 %
Resource Mgmt, L3
People
5 % Incremental
Response/ Resolution
Discrete Managed Service
End to End SLA
Fixed
5-7 %
Application Mgmt
People, Tool
10 % Incr. to Baseline
MTTR, Biz. Case
Integrated Service Mgmt
Outcome Based SLA
Fixed + Service Catalog
10 % +
Service Strategy, Governance
Tool, Process
15-25 % Incr. to Baseline
Cycle Time, Productivity
1. Strategic Partner Workshop
(A workshop moderated by industry though leaders like Tarun Khanna,
brings Big Pharma & HCL Sr. Leadership onto a common platform to identify a shared vision for the relationship: A
Value Roadmap)
Studio Workshops– Towards a New Thought Relationship
2. Axon: ERP Benefit Realization
Deriving greater ROI on SAP Investments
Moderated by Chris Beiswenger, COO HCL Axon
3. Asset Rationalization & Archival
Execution Plan to accelerate IT Portfolio Optimization in a M&A Scenario
HCL Enterprise Architect Dharmender Kapoor
Taking EFCS Beyond Boundaries
Henley Business School Harvard Business School MIT Sloan School of Management Oxford University ICEDR LRN CIPD La Fosse CIO Submit Leadership Spectrum, Nasscom Wall Street Journal-Leadership Submit
EFCS @ Speaking Forums
There is something unique about HCL’s management model that the world is talking
about…
Most Influential – Five companies to watch: Facebook, HCL Technologies, Craigs List, SKS MicroFinance, LI & Fung
HCL wins FT ArcelorMittal Boldness in Business Award
Acknowledges HCL Technologies as the “world’s most modern management”
“HCL’s Employee First and ‘democratization’ of management concept could ‘bring about a corporate renaissance.”
40
HCL Technologies was amongst the two examples of companies with Authentic Leadership which was presented at the WEF discussion in 2008
HCL Technologies is Best Company(listed in India) in Investor Relations
Why HCL Technologies is Disruptive and Bears Watching– Barry Rubenstein
“…though it has not received the hype of a salesforce.com or Google, we believeHCL may very well be one of the contenders to lead the IT services world of thevery near future.”
“HCL’s Employee First as a new and radical management philosophy which willcatch on with the world sooner or later.”
41
HCL is taught at Harvard as a premier case study on strategy and organizational leadership
HCL is featured as a case study in a global best-seller
Darden School of Business has done a case study on the impact created by HCL through its “Employee First Customer Second” practice
IBM and the other multinationals are becoming increasingly nervous about HCL Technologies…
42
What if we What if we invest in our invest in our
employees,anemployees,and they leave?d they leave?
What if we What if we invest in our invest in our
employees,anemployees,and they leave?d they leave?
What if we What if we don’t invest in don’t invest in
our our employees employees
and, they stay and, they stay ??
What if we What if we don’t invest in don’t invest in
our our employees employees
and, they stay and, they stay ??
Th
For your attention and participation!
Thank You