Retaining the blue collared workers is becoming a challenge. The client companies looking at low-cost services pay only minimum wages and expect the service providers to retain workers.
“This is a challenge and for the next few years, it is going to become greater, until the time, the industry matures and the client understands the worth of this service; that the FM service provider is a partner who is enabling them to run their business better and that they need not cut corners or lower rates too much. Margins have to be shared. We can’t hang onto high margins and neither can the clients lower their cost too much. That is how we have to evolve and there is no other way,” says Dr Srinivasan.
There are good strategies to retain blue collared workers as they are the backbone of the facility company.
“Minimum wages are going up every year and vary from state to state. In some states it is pretty high so it may not always be true that workers are not getting paid enough. Secondly, in most of the blue collared scenarios, the reasons workers cite are that they don’t get paid on time or that they don’t get treated properly. This is one of the key aspects one has to consider in trying to retain workers. Reward and recognising, of the employees for doing a great job can be adopted as a social responsibility. A trip to Thailand will not make a difference to them but getting their salaries on time, a bonus on Diwali and medical facilities by the company for themselves and their family are some of the other parameters which the workers otherwise cannot afford, will make a larger difference. So you really have to balance and at the same time ensure 100% on the hygiene delivery which is a key to blue collar retention. Most of the times, with blue-collared guys, the turnover is out of necessity. Many companies just don’t pay as opening of bank accounts is a huge issue. If the worker gets paid say र10,000 and if he goes and withdraws it from the bank, the bank is reluctant to keep that account. So there are a lot of operational hazards and issues which you really need to tackle for the blue collared worker and also from the compliance and legal point of view there are statutory requirements. If you read some of the old laws of 1957 and 1963, you will actually find that they are very definitive in one sense and they are pretty vague in the other. In case of blue collared guys, you need to really have a pipeline and a vocational training programme to be able to meet the needs and requirement for the future, because for him the र1000-1500 jump is a big deal. But for a white collared worker it may not be such a big deal, so he will negotiate a much higher jump before he wants to leave. Yes in good days, kind words and respect worked, but now a combination of those things along with financial and social responsibility that you show towards them would make a big difference.
Any contracting company would today look forward to be L1, to get the contract, which doesn’t permit cash benefit to the worker are financially given benefit. Financial rewards have to be acknowledged by the principal employer and should be taken as a part of the cost. But, being in the race, we want to be L1 and we are not able to give those motivations. Educating our society, our clients, our customers, and even ourselves is an issue.
In most of the MNCs and global companies, procuremendepartments have taken over the commercial aspect of the matter. So every time you are going for these negotiations, the commercial guy is comparing on parameters which are just wages and that’s where the challenge lies. It is a personal organisational choice, whether I want to work on a 4% or 5% margin or on an 8% margin. When it comes to indemnities, the company asks to sign up, but when it comes to legalities and compliances it wants 100% compliances and, it costs money. If a client is not willing to pay for it, why do business with him? But if you have the courage to do that, it can help. Otherwise, you cannot blame the environment on that.
Another aspect to help the blue collared worker is the upgrading of skills and proper communication. The company can also offer insurance for him and his family. Multiple strategies work. It all depends on the importance of the business, the margins that you enjoy and there are companies which are investing back in their people. They know that if they don’t do that they are going to lose a trained guy and the cost of replacing him and training another person is much higher than retaining him. So really speaking, it’s a combination of a lot of aspects – communication, management, training, and upgrading of skills. If there is an electrician, help him to go to the next level by sending him to the state run vocational training programme.
It is stated that retention is not primarily the job of a HR. But in any organisation, strategies are designed by the board and the stake holders include HR as well.
Unless an HR function is a business enabler and they understand the business, they cannot advise the Board. Line managers have the experience, they have the expertise and the responsibilities but when you talk about retention being the sole responsibility of the CEO, I do not mean the CEO alone; the line managers and the top management are also responsible. If you abdicate that responsibility and give it to somebody else its like saying, I’m a good mother but I have got to go and work. You got to understand and drive yourself. Execution is the key. Strategising is fine, visioning is fine, but if you don’t micro manage and actually go and execute; and just see it as line manager’s job that is getting done, things will not happen. The CEO or top managers should do surprise visits to the clients’ facilities.
Managing Recruitment and Talent Retention in FM Industry – II
In the last issue of CIJ, the excerpts of the presentation on managing recruitment and talent retention at the Clean India Show 2010, was discussed. The replies given by Dr R Srinivasan, CEO of HR Strategist, to some of the questions raised by FM and housekeeping professionals at the conclusion of the presentation are here below.
Retaining the blue collared workers is becoming a challenge. The client companies looking at low-cost services pay only minimum wages and expect the service providers to retain workers.
“This is a challenge and for the next few years, it is going to become greater, until the time, the industry matures and the client understands the worth of this service; that the FM service provider is a partner who is enabling them to run their business better and that they need not cut corners or lower rates too much. Margins have to be shared. We can’t hang onto high margins and neither can the clients lower their cost too much. That is how we have to evolve and there is no other way,” says Dr Srinivasan.
There are good strategies to retain blue collared workers as they are the backbone of the facility company.
“Minimum wages are going up every year and vary from state to state. In some states it is pretty high so it may not always be true that workers are not getting paid enough. Secondly, in most of the blue collared scenarios, the reasons workers cite are that they don’t get paid on time or that they don’t get treated properly. This is one of the key aspects one has to consider in trying to retain workers. Reward and recognising, of the employees for doing a great job can be adopted as a social responsibility. A trip to Thailand will not make a difference to them but getting their salaries on time, a bonus on Diwali and medical facilities by the company for themselves and their family are some of the other parameters which the workers otherwise cannot afford, will make a larger difference. So you really have to balance and at the same time ensure 100% on the hygiene delivery which is a key to blue collar retention. Most of the times, with blue-collared guys, the turnover is out of necessity. Many companies just don’t pay as opening of bank accounts is a huge issue. If the worker gets paid say र10,000 and if he goes and withdraws it from the bank, the bank is reluctant to keep that account. So there are a lot of operational hazards and issues which you really need to tackle for the blue collared worker and also from the compliance and legal point of view there are statutory requirements. If you read some of the old laws of 1957 and 1963, you will actually find that they are very definitive in one sense and they are pretty vague in the other. In case of blue collared guys, you need to really have a pipeline and a vocational training programme to be able to meet the needs and requirement for the future, because for him the र1000-1500 jump is a big deal. But for a white collared worker it may not be such a big deal, so he will negotiate a much higher jump before he wants to leave. Yes in good days, kind words and respect worked, but now a combination of those things along with financial and social responsibility that you show towards them would make a big difference.
Any contracting company would today look forward to be L1, to get the contract, which doesn’t permit cash benefit to the worker are financially given benefit. Financial rewards have to be acknowledged by the principal employer and should be taken as a part of the cost. But, being in the race, we want to be L1 and we are not able to give those motivations. Educating our society, our clients, our customers, and even ourselves is an issue.
In most of the MNCs and global companies, procuremendepartments have taken over the commercial aspect of the matter. So every time you are going for these negotiations, the commercial guy is comparing on parameters which are just wages and that’s where the challenge lies. It is a personal organisational choice, whether I want to work on a 4% or 5% margin or on an 8% margin. When it comes to indemnities, the company asks to sign up, but when it comes to legalities and compliances it wants 100% compliances and, it costs money. If a client is not willing to pay for it, why do business with him? But if you have the courage to do that, it can help. Otherwise, you cannot blame the environment on that.
Another aspect to help the blue collared worker is the upgrading of skills and proper communication. The company can also offer insurance for him and his family. Multiple strategies work. It all depends on the importance of the business, the margins that you enjoy and there are companies which are investing back in their people. They know that if they don’t do that they are going to lose a trained guy and the cost of replacing him and training another person is much higher than retaining him. So really speaking, it’s a combination of a lot of aspects – communication, management, training, and upgrading of skills. If there is an electrician, help him to go to the next level by sending him to the state run vocational training programme.
It is stated that retention is not primarily the job of a HR. But in any organisation, strategies are designed by the board and the stake holders include HR as well.
Unless an HR function is a business enabler and they understand the business, they cannot advise the Board. Line managers have the experience, they have the expertise and the responsibilities but when you talk about retention being the sole responsibility of the CEO, I do not mean the CEO alone; the line managers and the top management are also responsible. If you abdicate that responsibility and give it to somebody else its like saying, I’m a good mother but I have got to go and work. You got to understand and drive yourself. Execution is the key. Strategising is fine, visioning is fine, but if you don’t micro manage and actually go and execute; and just see it as line manager’s job that is getting done, things will not happen. The CEO or top managers should do surprise visits to the clients’ facilities.
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