Page 354 - Business Principles and Management

Chapter 13 • Planning and Organizing

Focus On...

Management Innovation–Putting
Employees First

What kind of company would put employees first and customers sec-
ond? Non-managerial employees are considered more important than
managers. That is the innovative view of Vineet Nayar, president of HCL
Technologies. HCL is located near New Delhi, India. The company em-
ploys 30,000 people in the competitive information technology out-
sourcing business.
Employee empowerment comes first with Nayar. He is a strong be-
liever that effective teamwork and motivated employees build a great
company. He trusts employees so much that management evaluation
is put in their hands. Every employee rates not only his or her own boss
but any three other managers in the company. Employees fill out an
18-item questionnaire and the results are posted online where all em-
ployees and managers can review them.
Another innovation in employee empowerment is the employee
“ticket.” Whenever employees see a problem or want managers to
take some action, they can immediately fill out an electronic form.
The issue can be as simple as a problem with the menu in the cafete-
ria or as major as a product defect the employee has identified. The
“ticket” is immediately routed to a manager who becomes respon-
sible for the solution. And when is the solution satisfactory? Not until
the employee who filed the original form is satisfied.
A public question-and-answer space is provided on the company’s
intranet, where any employee can post a question and receive a reply
from management. Again, all questions and answers can be reviewed
by every employee. Over 400 questions are posted each month. Man-
agers are actually rewarded by the number of employee tickets and
questions submitted—the more the better. HCL managers receive regu-
lar training in how to be effective in an empowered work environment.
Key courses are negotiation skills and expectation management—how
to meet the expectations of employees.
The results of the company’s employee empowerment program
have been outstanding. Employee retention rates have doubled in
an industry where highly skilled employees change jobs regularly to
increase their pay. At the same time, sales, profits, and the company’s
stock price are climbing. “I want to be the company that gives supe-
rior service to my employees compared to everybody else,” Nayar says.
He wants anyone who leaves HCL to end up frustrated in their new
job because of their loss of empowerment.

Think Critically

1. Do you agree or disagree with Vineet Nayar’s management
philosophy? Why?
2. Would you like to work as a manager in that type of company?
Why or why not?
3. How do you believe customers feel about Nayar’s views that
employees are first and customers are second?

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