Comparative Study Of Best Companies Work For India Business Essay

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Anubhav Sangwan, Amrit Chopra, Manan Choksi, Sayan Das, Jai Kotak, Nupur Bandopadhya, Sinto Inasu, Sampada Rahalkar, Suraj Ramkumar, Smruti Sherlekar

Abstract

Best Employers inspire people to do their best work, motivate them to stay with the company, and cause them to promote the company to their friends, family, and customers. Essentially, because Best Employers create an environment in which employees' needs are met, employees are more engaged. This is a feat to which many companies, especially those that desire to survive in the long term, aspire. The idea behind the study was to establish what best practices are been adopted by the companies to attract, retain and motivate the workforce which make them 'Best or Great Companies to work for'. In order to do this, various studies by consultancies like Hewitt Associates and Great Place to Work have been taken into consideration through our secondary research. An attempt has also been made been made at understanding whether these outcomes are used by the HR consultancy firms through a primary research questionnaire

Guides: Prof. Nitin Vazirani, Dean - HR and OB, Prof. Vatsala Bose

The authors are students of Post Graduate Diploma in Management from the 2009-11 Batch.

Introduction

1Competitive companies in Asia have provided some of the best growth and international competitiveness models in the latter half of the twentieth century. 2Globalization, pressure for speed and innovation, and growing competition for talented workers have given organizations in Asia, particularly India and China, added incentives to review their employee relations strategies in order to attract, motivate, and retain the workforce that will help them be successful. Yet, because, for many organizations, skilled employees are hard to attract and difficult to retain, how to differentiate HR practices to attract and retain these people has become critical to business success. Thus, many organizations refer, in some way, to their desire to be an employer of choice.

2To accomplish this, the human resources (HR) often attempts benchmarking: a systematic process for evaluating the products, services, and practices of organizations that are considered to be reputable leaders for the purpose of organizational improvement.

The industry leaders are basically those listed in best employer studies (BESs) carried out by various institutions and these are updated every year. A few to list would be: Hewitt Associates, Great Places to Work institute, Forbes, Mercer, etc. have worked on the best companies to work for from recent years.

Literature review

The literature review focuses on published research on BESs and related research. The articles used for the literature review were identified through searches of Ebscohost research database, Google Scholar, Sage Publications, research papers by the rainmaker group and other white papers published on the Great Places to Work.

2Human assets are now regarded as the primary source of value, growth, and sustained competitive advantage. Due to competition for talents, one of the efforts to become an employer of choice is to benchmark with leading companies in terms of HR practices. Thus, a number of corporate reputation ranking studies by media such as Fortune magazine have come into being since the 1980s.3Prior research has recognised the association between Quality of Work Life (QWL) of the employers and the quality of service offered by the employees. Studies have also found QWL to be an important factor influencing organisational commitment and employee turnover intentions. 4Another factor, employee engagement comprises individual value, focused work, and interpersonal support.5Also, an engaged employee is aware of business context, and works with colleagues to improve performance within the job for the benefit of the organization. It is a positive attitude held by the employees towards the organization and its values.

2.1 Conceptual Model for Best Employer Studies

2Strategic HRM (SHRM) focuses on the relationship between strategy, HR practices, and financial performance. The concept of fit or alignment is the most important theoretical perspective underlying SHRM. First, vertically, it entails the linking of HR practices with the organizational vision, values, and business strategy. It especially stresses the need for alignment of business strategy and HR practices. Second, horizontally, it emphasizes the coordination or congruence among various HR practices through a pattern of planned action. Vertically and horizontally aligned HR practices could positively affect employee engagement, HR reputation, and eventually, financial performance (see Figure 01).

FIGURE 01: A Conceptual Model of Best Employer Studies

This is where most organizations want to know how they compare with other organizations. Using a standard measure of engagement allows an organization to see how it measures up to other companies along a simple set of fundamental work qualities and this is where the BESs studies come into play.

3.0 Objectives

To find the parameters used by consultants that make companies best places to work for.

A comparative study of companies, considered as best places to work for by Hewitt and Great places to work.

To find whether the outcome of the Best Employer Studies (BESs) are used by HR placement agencies through a primary survey questionnaire.

3.1 Scope

For our studies we have analysed top 10 companies featured in the 'Best Companies' released by Hewitt Associates and Great places to work for the current year. The scope of the primary survey questionnaire limits itself to the following:

Awareness level of the HR placement agencies about the studies conducted by Hewitt and Great places to work.

Understanding of the parameters that prospective employees and employers seek during recruitment.

4.0 Methodology

To study the different parameters used by both the consultancy firms and draw the common and uncommon ones.

To highlight the companies featured by Hewitt and Great places to work in the last two years.

To analyse the key HR practises of those companies that were featured among the best companies to work by both Hewitt and Great Places to Work.

For the primary survey, a questionnaire was floated among 20 HR consultancy/placement firms in Mumbai that addressed the following questions:

Whether one was aware of the studies conducted by the Hewitt Associates and Great Places to Work

How do they rate the companies that are featured by Hewitt Associates and Great Places to Work as a 'Best Company to Work'

What are the important parameters that prospective employees and employers seek in each other during recruitment

5.0 Hewitt Survey in India

The purpose of the BES studies conducted by Hewitt Associates in India is to examine HR practices in leading organizations and to explore what makes companies good to work for and to provide insights into how companies can achieve competitive advantage through their people. This study provides a benchmark of practices that are valid for the participating countries within the Indian context.

5.1 Key Parameters

For the studies conducted by Hewitt Associates, engagement and alignment are the key parameters used to determine the connections among business strategy, HR strategy, and employee opinion.

2Engagement is the Hewitt's measure of emotional and intellectual commitment employees have to an organization. Its calculation is based on a series of questions in an employee opinion survey that focuses on "whether employees:

(a) Say great things about their company,

(b) Whether they want to stay with their organization, and

(c) Whether they go the extra mile and strive to achieve the best results for their organization"

2Alignment measures the extent to which employees, organizational leaders, and HR practices support the overall business direction. An organization is aligned when:

(a) HR practices support the business strategy,

(b) Employees have a good understanding and share leadership's perspective on the organizational goals and strategic direction, and

(c) The measures used for long-term shareholder value are also used to manage the business and as incentives for employee rewards.

6For their research, the following survey tools are used:

(a) An employee opinion survey,

(b) A detailed survey of HR practices (People Practices Inventory), and

(c) A CEO questionnaire (see Table 01).

Table 01: Study tools of BES and their purposes

STUDY TOOLS

PURPOSE AND PROCESS

Employee Opinion Survey (EOS)

Randomly selected sample of employees were surveyed in each participating company to

gain their perspective on how engaged they were in the business

People Practices Inventory

Designed to gather information about human resource practices influencing the management of people in organizations, this was used to identify those features that set the best employers ("The Best") apart from the rest ("The Rest").

CEO Questionnaire

Each company's CEO provided information about the business strategy of the organization and his or her philosophy and approach to managing people

SOURCE: Based on Hewitt (2009)

6.0 Great Place to Work® Study in India

7Great Place to Work (GPTW) Institute has been working for over 22 years with large global and local firms in understanding the relationship between a company and its employees.

According to GPTW, the definition of a great place to work is a place where employees "trust the people they work for, have pride in what they do, and enjoy the people they work with". It is by this idea that a great workplace is measured by the quality of the three, interconnected relationships that exist there.

6.1 Key Parameters

The parameters used by GPTW institute to gauge the performance of companies are:

Credibility: Credibility depends on whether:

Communications are open and accessible.

Competence in coordinating human and material resources.

Integrity in carrying out vision with consistency.

Respect: Respect depends whether the company is:

Supporting professional development and showing appreciation.

Collaboration with employees on relevant decisions.

Caring for employees as individuals with personal lives.

Fairness: Fairness depends on whether the company follows:

Equity - balanced treatment for all in terms of rewards.

Impartiality - absence of favouritism in hiring and promotions.

Justice - lack of discrimination and process for appeals.

Pride: Pride depends on whether the company realizes:

Individual contributions in a collective job.

Whether work produced by one's team or work group.

The organization's products and standings in the community.

Camaraderie: Camaraderie depends on the employees':

Ability to be oneself.

Socially friendly and welcoming atmosphere.

Sense of 'family' or 'team'.

6.2 Study Tools:

'Trust Index' is an employee survey tool that measures the levels of trust, pride, and camaraderie within your workplace. Employee responses to this instrument comprise the majority of an organisation's score.

'Culture Audit' is a management questionnaire that utilizes to gain a better sense of the overall culture of the organisation. This instrument is made available only to select accepted applicants. There are two parts to this instrument.

Employees are asked about items such as employee demographics (i.e. number of employees in India, voluntary turnover, ethnic breakdowns, tenure, etc.). They are also asked general information about the company (i.e. year founded, revenues), as well as about benefits and perks offered to employees (i.e. on-site fitness centre, percentage insurance premium paid by company for employee, number of holiday days).

This part of the 'Culture Audit' asks open-ended questions that give the members of the company an opportunity to share with us various aspects of their culture.

Table 02: Parameters Considered by Hewitt Associates and Great Place to WorkA summary of the above discussed parameters considered by Hewitt Associates and Great Place to Work(R) is given below (see Table 02):

Sr. No

Parameters considered by:

Hewitt Associates

Great Place to Work(R)

1

Engagement:

Employees commitment to company

Say, stay and strive for the company

Credibility and Respect:

Good Org communication

Integrity in Vision

Supporting professional development

Work Life Balance

2

Alignment:

Supportive HR practices

Employees have good understanding of organization's goals

Long term shareholder value

Source: Adapted from Hewitt Associates (2009) and Great Place to Work (2009)Incentive Rewards

Fairness, Pride and Camaraderie:

Impartial and meritorious employee treatment

Emphasis on individual along with team work

Friendly working atmosphere

Sense of belonging

An initial observation from the above comparison shows that the parameters considered by Hewitt Associates and Great Places to Work(R) differ considerably. Hence, it is imperative that the results of their studies also vary. This is discussed in the section below.

7.0 Comparison of Top 10 Companies

Table 04: Top 10 companies in India by Great Place to Work®

Table 03: Top 10 companies in India by Hewitt AssociatesFor the year 2009, the Best Employers in India (Top 10) according to the Hewitt and Great Places to Work(R) are as follows (see Table 03 and Table 04 respectively):

RANK

ORGANIZATION

RANK

ORGANIZATION

1

2

3

4

5

6

7

8

9

10

HCL Technologies

Hindustan Zinc Ltd.

Taj Hotels Resorts and Palaces

Cisco Systems

ITC-Welcome group (A division of ITC Ltd.)

Intuit Technology Services Pvt Ltd

Eureka Forbes Limited

LG Electronics India Pvt Ltd.

Domino's Pizza India Ltd

Marriott Hotels India Pvt Ltd.

1

2

3

4

5

6

7

8

9

10

RMSI Private Limited

Intel Technology India Pvt Ltd.

Federal Express Corporation

Aviva Life Insurance Co India Ltd

Google India Pvt. Ltd.

Qualcomm India Pvt Ltd

Marriott Hotels India Pvt. Ltd.

American Express

Network Appliance Systems Pvt Ltd.

NTPC Limited

Source: Hewitt 2009 Source: Great Place to Work 2009

From the above tables, we find Marriott Hotels Pvt. Ltd. as a company that features in both the lists (No. 10 and No. 7 respectively).

We, now try to look into the key parameters that made Marriott Hotels Pvt. Ltd. feature in both of the above lists.

7.1 Marriott Hotels Pvt. Ltd.

8The various innovative HR practices used by Marriott Hotels Pvt. Ltd. earned them the reputation of being 'the best place to work' in the hospitality industry. Marriott's 'Spirit to Serve' culture and its HR philosophy guides its various HR initiatives in the recruitment, selection, training and development of employees.

Apart from providing a competitive pay package, Marriott strived to give its employees a good work life. The company gave equal importance to non-monetary factors such as work-life balance, good leadership, better growth opportunities, a friendly work environment and training. Some key HR practises of Marriott Pvt. Ltd. are provided in the table below (see Table 05):

Table 05: The HR Practises of Marriott Hotels Pvt. Ltd.

Sr. No

HR Practice

Remarks

1

Manpower Planning, Recruitment and Selection

Marriott attached a lot of importance to manpower planning. It started right from entry level and went through to higher positions. Every unit of Marriott (division or department) prepared its expansion plans over the next couple of years, and, in the process, decided on the number of entry level and managerial employees required for the expansion.

2

Training and Development

T&D programs varied between frontline employees and managerial personnel. Over time, training programs evolved from classroom - based teaching to interactive multimedia training. During the training period, a mentor, addressed as 'buddy' is allotted to each recruit.

3

Employee Retention and Welfare Initiatives

In Marriott, customer service was provided on a 24/7/365 basis. The implication was that employees had to go through a hectic work schedule; an average work week lasted more than 50 hours.

Facing this challenge, Marriott launched a new program called Management Flexibility in February 2000 on a pilot basis at three of its hotels.

The aim was to assist Marriott's managers in balancing their professional and personal lives, without negatively affecting customer service or the company's financials.

4

Grievance Redressal System

By the mid-1990s, Marriott had a comprehensive complaint resolution system in place, known as the Guarantee of Fair Treatment (GFT), to ensure that employee grievances were addressed.

Source: www.icmrindia.org

Apart from Marriott Hotels Pvt. Ltd., an interesting observation is that no other company features as a common company in the 'Best Companies' list of Hewitt Associates and Great Places to Work(R).

Hence, from such an observation, one can say that the methodology and stakeholders of the studies by Hewitt Associates and Great Place to Work(R) differ significantly, leading to different findings as shown in the tables 03 and 04. This can possibly be a starting point for further research on this subject.

Also, when such differences in become predominant, the real application of these findings by, on the field, HR placement agencies becomes ambiguous. In order to know more about the application of these studies, a primary research was conducted on HR placement agencies in Mumbai, India. The results of the survey are discussed in the sections next.

8.0 Primary Survey

For the primary survey a questionnaire was floated among 20 HR consultancy/placement firms in Mumbai, which addressed the following questions:

Whether one is aware of the studies conducted by the Hewitt Associates and Great Places to Work

How do they rate the companies that are featured by Hewitt Associates and Great Places to Work as a 'Best Company to Work'

What are the important parameters that prospective employees and employers seek in each other during recruitment

The primary survey was conducted across the city of Mumbai and the findings from 20 such HR placement agencies are as follows:

8.1 Findings and Analysis

Awareness:

Figure 02: Awareness of HR placement firms

While HR consultancy firms were aware of the annual published information on the Best Companies to Work; the awareness about the research studies by Hewitt Associates and Great Places to Work varied as shown in Figure 02.

The awareness of these institutes conducting research studies on 'Best Companies to

Work in India' were:

Hewitt Associates : 33 %

Great Place to Work : 27 %

Others : 40 %

Figure 03: Ratings by HR placement firms (cumulative)

Company Ratings

According to HR placement firms, the top three companies are as follows (see Fig 03):

Google India Pvt. Ltd.

Taj Hotels Resorts & Places, and

H.S.B.C Bank

These companies were primarily selected based on the experience of the recruitment process of the HR placement firms and the feedback received by the newly recruited employees.

However, these differ from the results of those published after the research done by Hewitt and Great Place to Work. While Google stood no. 5 in the Great Place to Work's 'Best Companies' list, Taj Hotels Resorts & Places and H.S.B.C Bank stood at no. 3 and no. 22 respectively in the 'Best Companies' list of Great Place to Work.

Parameters sought by Prospective Employers

Before the actual process of recruitment begins, the prospective employers lay down different criteria of selection to the HR placement agencies. According to the HR placement agencies, the top three priority parameters are:

Education / Professional certification

Technical skills, and

Competency

Some of the other important parameters include leadership qualities, prior experience, fit with the organization cultures and values, personality while the less important parameters include knowledge of other languages and willingness to relocate.

Parameters sought by Prospective Employees

One obvious parameter that had been used over the years by employees to judge a potential employer is the remuneration capability. However, in today's times this is not the ideal situation. While the salary does play a vital role in judging the one among different employers, other parameters like learning and development opportunities were found to be quite important.

The top three parameters sought by employees are:

Learning and Development

Career Growth, and

Job Satisfaction

Other important parameters include leadership development, job security and salary. Employees consider parameters like cultural diversity, company CSR initiatives less important.

The following figures give a comparison of the above mentioned parameters (see Fig 04 and Fig 05):

Figure 05: Parameters sought by Prospective Employees (cumulative)

Figure 04: Parameters sought by Prospective Employers (cumulative)

9.0 Recommendations

Comparing the studies on the 'Best Companies to Work in India' by Hewitt Associates and Great Place to Work, and the general consensus of the HR placement firms, it can be concluded there is a considerable difference in the opinion of these firms when it comes to selecting a 'Best Company to Work for'.

This basically depends on the parameters considered by these firms. While the main parameter under consideration by Hewitt Associates is the employee perception towards the company, the parameters under consideration by Great Place to Work are credibility, respect, fairness, pride and camaraderie. On the other hand, for HR placement agencies the main parameters are learning and development, career growth and job satisfaction. Hence, for such results to be synchronized, one has to look at the Best Companies from a holistic approach and not only from research studies of different institutes.

Another recommendation would be to the HR placement agencies to regularly study more on the 'Best Companies to Work' because this shall not only keep them updated about the best companies to work but also use these results as a marketing tool to potential employees, thus increasing their business value.

10.0 Conclusion

Our study was fruitful as we gained knowledge on the parameters that were used by 'Hewitt' and 'Great places of work for' to rank the companies as best companies in India to work for. Also, we gained an insight on the HR policies that differentiate a company as a 'Best Company'. It is these parameters and policies that help a company to sail through to the top position when it comes to being nominated as an adorable and coveted company to be associated with.

Also an important point that we noticed was that most of the HR Consultants do not consider the ratings before placing people with their employers. Hence, it is our suggestion to these HR Consultants to consider these ratings by credible sources like Hewitt and 'Great Places to work for' before placing people. This will mitigate the rate of attrition among the employees as the companies rated as 'the Best Companies to work for' know how to take care of their employees. Hence, it is important for these HR Consultants to at least know of the companies that have been rated as the best companies to work for.

One can clearly say that the 'Best Companies to Work for', does create a platform for other companies to look up to as a benchmark and continually improve their own HR practices and policies. In fact, it is these HR practices that will lead to being not only a satisfied but also a highly competitive work force. It is these workforces that will help India carve a niche for itself in the fiercely competitive market. Surveys by credible companies like Hewitt and 'Great Places to work for' helps create a win-win situation for all the stakeholders.

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