Who is a non-performer?
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Nowadays, whenever companies sack their employees, the standard line is … “their performance was not in line with our parameters.” Or, something similar. While it may be true in some cases, that argument looks more than a bit stretched in most. Let’s do a reality check. Not so long so, industry bodies were claiming that there’s still dearth of good talent. With companies in an expansion mode, hiring was frenzied. Head hunters would call executives aggressively. And in the event that a particular executive was uninterested, pat would be the reply, “Would any of your friends be interested?” But things have turned for the worse. With recession plaguing the entire world, the demand for talent is no longer so great. In fact, companies need to cut flab. And all that excess capacities built up in anticipation of future growth need to be pruned. So, quite a few employees have had to take the bitter ‘layoff’ pill. But by branding the ‘laid-off’ employees as the worst performers is grossly unfair. If the company’s plans have gone haywire, it is not the employee’s fault. Instead of admitting this, many are harping about non-performance, stricter parameters and so on… The fact being that no management wants to admit that their ambitious plans have gone wrong and in many cases, over-aggression has caused them grief. Take the example of real estate companies – huge land banks were built by buying at astronomical prices. And that too in the latter half of 2007-08, when it was well known that the subprime crisis is looming large over the world. Now that many of these projects are under hold indefinitely, can the employee who is being thrown out be called a non-performer? In fact, the word ‘non-performance’ has almost become a joke. Sample this: Recently, when the two senior employees (CEO, COO types) left an organisation, a mail was sent to the corporate communications enquiring about the reason. The response was something like this… ‘individuals whose performance were not in line with the company’s parameters quit’. It isn’t funny… |
(17 votes, average: 4.12 out of 5)
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May 19th, 2009 at 8:50 pm
Nice one.
To add to it, Indian IT sector growth was phenomenal, but during this growth phase, some of the companies became too ambitious and started recruiting in large number and more importantly there was no billing pressure, shorter sales cycle with negotiation not being intense, added to this since there was attrition too, companies had to keep buffer resource thinking of 30% growth they were able to achieve year after year.
But now, all the above factors of growth disappeared within a quarter and growth had become stagnant/slow, if not shunted. This has all led to trimming cost eventually in the name of “non-performance”. The top management needs to be little innovative in their approach to sort this out, since India is still a low cost and has high skilled resource base.
May 17th, 2009 at 11:33 am
I would like to compliment on what has been said about performance by throwing light the entire performance appraisal process.
All the goal setting set during annual appraisal are subjective in nature like working in team skill, communication skill, taking additional initiative apart from normal work, growing business for company, number of training imparted and given .These parameters are so subjective that literally anybody can get any rating on these.The manager just puts a number on each of these goal just to arrive a overall rating which he feels should be given to the appraiser .
Also, the idea behind these subjective/hypothetical goal setting is to avoid argument which happens during appraisal discussion as the appraiser is bound to give lower rating to 20% of the appraisee’s mandated by HR so that they can be shown the exit process.
All the subjective goal rating are then given a empirical number to derive a overall rating which are then fitted into a performance curve to derive the relative ranking(A,B,C,D) of the employee.
The last ranking D need to consitute 10-20% of the employee curve who need to undergo either performance improvement plan or an exit depending on previous year’s rating.
I believe the process is flawed when viewed from the perspective that they are used for exit/performance improvement plan process.
The entire process is a systematic process of beinging employees to submission, harassment in the name of performance.
May 15th, 2009 at 6:30 pm
Couldn’t agree more. The criteria for non-performance is not documented in any of these cases and the employees are threatened that if they dont quit their experience certificates would be indicated of non-performance and then spoil their enitre career. This is very much in the IT Service corporations. I think government should enact Labor laws to control this menace. If not idiots at the top would spoil career of so many innocent employees and hence their lives.
I dont know what was the parameter that was used for recruiting and what has changed since than for non-performance. In many case IT Service companie push employees in their non-core skills and put employees under pressure and stress. This automatically results in non-performance of the employee which is a function lack of Mentoring and training at the right level for the employee.
These freaking idiots at the top are not accountable to any one and Unions in the IT Companies is not far away if these Idiots dont recognize the impact they are having on employees morale.
Good topic and right perspective to the issue.
May 15th, 2009 at 4:04 pm
You’ve touched a raw nerve there. very topical
May 15th, 2009 at 1:59 pm
Absolutely that the term “non-performance” has become a joke especially for the IT service sector. For realty especially commercial, office space and large township, I guess they are more transparent in being laying off people for simple reason of lack of capital and this industry has seen the cycle more often than the IT sector. In retail if a Subhiksha shop closes or any other retail outlet is closed, people know it is because they can’t afford to run the place, but IT companies coin these fancy terms of “performance” the way they have been using in last decade.
It is purely due to shear recklessness from the management (including the top ten) of IT companies. Even though the management is supposed to read the macro economic situation like sub-prime and its consequence but haven’t cared, at least they are supposed to financial feasibility…when the commercial spaces were sky high and reaching more than international standards there were companies planning for leasing them ..these CEO, CFO are supposed to have a control of their operational costs..and what is the risk? So no wonder the CEO/COO is quit citing the reason of not meeting company expectations….
But employees are at stake for this and unfortunately “performance” is given as the reason. These are the same award winning companies for their best hiring practices have recruited them in first place.. so who is fooling whom here? As rightly mentioned we Indian companies don’t want to admit the issue and mistake…..I will not be wondered if a company who gave choice to their employees to work for NGOs will get an award again for being innovative in avoiding layoff! But this does not take away the credit from this company of having access people….as the glorified “bench strength”
But this is a result of too much quick GROWTH and in too little time…. lots of lessons learnt.
May 15th, 2009 at 11:13 am
Good one!
May 15th, 2009 at 10:40 am
Yes.. very very true.. Absolutely in agreement with u. I have spent years in corporate world. MANAGEMENT IS ALWAYS RIGHT!!!.. But the truth is there are dumbos sitting at the top just because of their experience or because of a lot of Master degrees. They think what they do is always right.. Employees are poor scape goats of this entire process. Over all that there HR staff sitting to always applaud what the management does
May 14th, 2009 at 8:31 pm
My company has recruited several hundred employees during 2006 and 2007…and continued in 2008 as well. We were able to see bad times comming…why can’t management?
May 14th, 2009 at 3:26 pm
couldn’t agree more…