As per Towers Watson's research, 56 % of employees in India believe they must leave their organization to advance to a better job. Comparative figures stand at 43% for the United States, 41 % percent for the United Kingdom, 38 % for China and 37 % for Germany. This clearly suggests that a large number of employees in India have come to seriously consider job-hopping as a means to advance their careers.

1. CAREER MANAGEMENT
redefining
careers in india
C
ompanies in India have been struggling with
high employee attrition rates for many
Employees’ hitting a career years now. Excessive employee turnover
increases the costs of recruitment and
advancement ceiling poses a training, apart from hampering employee
productivity. In service industries, attrition at senior
levels can even lead to losing key clients to
serious challenge to companies in competitors.
In Towers Watson's Global Workforce Study 2010,
India. An overemphasis on which surveyed 20,000 employees globally, including
over 1,000 in India, career advancement was the
managerial careers may be one biggest influence on employees' decisions to join an
organization. Consequently, the study also found that
factor driving this persistent trend. employees in India who reported improvements in
their advancement opportunities over the previous
12 months were more engaged compared with
workers without such opportunities. High attrition
■ BY RICHA GULATI & SHATRUNJAY KRISHNA rates are often blamed on the lack of career
42 ■ December 2011 www.humancapitalonline.com ■

2. CAREER MANAGEMENT
advancement opportunities. Figure 1. Age structures in the U.S. and India
Supplementing this thought is a
survey of senior managers and
executives in India conducted by CII
and CSEND, which found the lack of
career advancement as the second
most-important factor, salary being
first, fueling high employee turnover.
In order to study the career
advancement opportunities in India
and the need for employers to
define new paths for their employees,
it is important to understand the
following: 1) the mismatch between
employees' career aspirations and the
opportunities available, 2) changes
in organizational workforce
demographics over time and 3)
employees' perceptions of their
career needs.
A mismatch between career
aspirations and opportunities
As per Towers Watson's research,
Fifty-six percent of employees in
India believe they must leave their
organization to advance to a better
job. Comparative figures stand at 43
percent for the United States, 41 Source: Towers Watson 2010 Global Workforce Study.
percent for the United Kingdom, 38
percent for China and 37 percent
for Germany. This clearly suggests option plans (ESOPs) along with expansion. It could be inferred that
that a large number of employees in managerial promotions. But again, these growth plans do not necessarily
India have come to seriously consider this solution often makes a bad include generating challenging career
job-hopping as a means to advance situation worse. These plans give paths for the majority of employees.
their careers. employees some "skin in the game," Instead, many organizations are
Employing some standard through owning a share of the dividing and even sub-dividing
retention tools, a few companies company in the form of stock. But existing career opportunities by
have responded to the mismatch the strategy has the unintended implementing faster promotions and
between career aspirations and consequence of making similar such practices.
opportunities by offering fast-track entrepreneurship more attractive to As a result, we observe an
promotions. But this practice only them, thereby pushing turnover rates overemphasis on managerial career
exacerbates the attrition problem. higher in the IT industry. paths in companies in India and the
Subject matter specialists cannot Entrepreneurship imposes growth in management courses
automatically become good managerial responsibilities and confirms this observation. India has
managers and leaders and a myopic requires a willingness to take risks, witnessed a sudden upsurge in the
approach towards employing and to invest in yourself and your number of MBA institutes/courses
promotions alone to retain talent is own company. It is a well known in recent years. Between 2005 and
bound to have counter productive fact that TechSpan, NIIT, Pertech 2011, the number of All India
implications. Computers, Global Infotech, Council for Technical Education
Recent media reports also InfoTech Enterprises, STG and (AICTE)-approved management
observe that employees are working Infogain were all set up by ex-Wipro programs jumped by 100 percent,
longer hours at the expense of a employees. Other leading software and the number of management
reasonable work-life balance to gain firms too are alive to these concerns. seats grew by more than 200 percent.
faster promotions and bonuses. It is ironic that employees A number of technical institutions,
Another retention strategy perceive a dearth of opportunities such as engineering colleges, have
adopted by companies in India, for career advancement when so also started offering MBAs as an
especially IT companies, is to offer many organizations in India are additional degree. In the long run,
the technical staff employee stock planning for substantial growth and this trend is likely to create a skills
■ www.humancapitalonline.com December 2011 ■ 43

3. CAREER MANAGEMENT
deficit in non-managerial academic the organizational value chain as they
studies. become more capable or skilled. In
In the next section, we investigate these industries, quite naturally, the
the overemphasis on managerial traditional path of becoming a
career paths in light of the underlying supervisor is not necessarily
changes in organizational workforce applicable. Workers can grow into
demographics in India. their next career stage by becoming
more competent.
Changing workforce To understand the different shape
demographics of today's workforce, we plot the
Recent changes in organizational age structure for a representative
workforce demographics partly sample of employees in large
explain why the emphasis on organizations in India and the U.S.
managerial career paths is misguided Clearly, there are stark differences
today, according to Tamara J. across countries, possibly arising
Erickson, who has authored a from differences in business models
research paper on the future of work as well as demographics. Emerging
in People and Strategy. economies like India are reaping a
Erickson says, "Many of today's demographic dividend, and their
organizational principles are knowledge-based and service
centered on the premise that the industries, such as IT, are savouring
workforce is shaped like a pyramid." the benefits that accompany
Over the last century, the pyramidal explosive growth. As shown in Figure
or bell shape of the workforce - a 1, a huge pool of young talent - those
small number of older workers, between age 25 and age 35 - makes
moderate number of mid-career up as much as 60 percent of the
workers and many young workers - total workforce in India. The U.S.
facilitated traditional upward workforce, on the other hand, looks
mobility. The result was a workforce more like an inverted pyramid, with
with a few top managers, somewhat a concentration of aging employees.
more midlevel supervisors/managers As Figure 2 shows, the workforce
and many workers. used to be compatible with a
The pyramidal workforce traditional career path, with the
harkens back to the prominence of largest concentration of workers at
manufacturing or process-driven the bottom of the climb. The "Now"
organizations, such as the military, diagrams reflect new demographic
railways and government. These realities in India and the United
organizations thrived on multiple States. Traditional upward career
supervisory levels, and employees trajectories may not be available for
would move up the hierarchy to all young professionals, as there are
become a manager or supervisor. too few managerial positions
The business model required available Thus, companies need to
command and control and a vertical create innovative and unconventional
hierarchy to emphasize supervision career paths to keep workers happy
at various levels. and control attrition rates.
However, changing economic Differences in the shape of
trends have gradually come to favor organizational demographics across
tertiary industries where supervision countries also implies that career
is not central to the success of the advancement strategies may need to
RICHA GULATI organization. With the emergence of vary from one country to the next -
service/knowledge-driven tertiary for example, an approach that
Senior Economist ■ Towers Watson
industries in India comes a variety succeeds in the United States might
Richa Gulati works as a Senior Economist of roles that create value for not work in India. This has significant
with the Research and Analytical Services customers mostly through the implications for multinational
team at Towers Watson. She has a capability of the workforce. organizations, which must
Masters degree in Economics from Delhi Accordingly, emphasis is shifting to accommodate the unique
School of Economics and specializes in becoming a more capable worker requirements of different countries
research related to talent and rewards rather than a manager or supervisor. in designing their global career
issues faced by organizations globally. In other words, employees move up frameworks.
44 ■ December 2011 www.humancapitalonline.com ■

4. CAREER MANAGEMENT
Figure 2. Workforce attitudes in India
How do you define career advancement in your job? (% of respondents)
Manager Specialist/
technician
Increasing my compensation 65 61
Acquiring new skills that make me eligible for other jobs 61 63
Achieving higher status or recognition 60 58
Obtaining a position in senior leadership 60 52
Acquiring new skills that help me do my current job better 59 71
Moving up a well-defined career path 56 59
Moving laterally across the organization to take on
different but equivalent roles 32 35
Some other way 7 6
Three most significant barriers to career advancement (% of respondents)
Manager Specialist/
technician
The organization has reduced the number of job levels so 57 41
there is less advancement opportunity
It is difficult to obtain a transfer or lateral movement 55 51
It is difficult to identify the opportunities available to me 42 35
There are no career advancement opportunities in 33 35
my current role
Employees in positions above me are choosing not to retire, 32 36
reducing my options for advancement
My manager does not advocate on my behalf 28 36
I do not believe I have the skills required to advance 19 22
I do not have the personal desire to advance 13 17
Source: Towers Watson Global Workforce Study 2010.
As has been reported in the their career aspirations and available
media, large Indian companies are opportunities. As part of Towers
already luring away talent from Watson Global Workforce Study
multinationals in India with the 2010, a sample of 1,101 employees
promise of better career from midsize to large organizations
opportunities. Foreign multinational in India shared their thoughts about
firms in India, being offshoots of career advancement.
global parent companies, tend to Our comparative analysis
offer fragmented and stationary roles highlights the differing career
to employees. Large Indian aspirations of managers and
companies, on the other hand, are specialists. While 65 percent of SHATRUNJAY KRISHNA
riding the wave of explosive growth managers regard pay raises as the Senior Consultant ■ Towers Watson
and are offering their employees most important manifestation of Talent & Rewards Group, India
exciting opportunities to innovate advancement, 71 percent of
and manage large-scale projects. specialists rate acquiring new skills Shatrunjay Krishna is a Senior Consultant
more highly. Other important with Towers Watson Talent & Rewards
Employees speak out rewards include (1) gaining high Group in Gurgaon. He has over eight years
We now look at employees' own status and a senior leadership of experience in large scale transformation
opinions (Figure 3) before proposing position for managers, and (2) higher projects and their implementation on the
solutions to the mismatch between compensation and a well-defined ground.
■ www.humancapitalonline.com December 2011 ■ 45

5. CAREER MANAGEMENT
Figure 3. Multiple career ladders
Source: Towers Watson
career path for specialists. model. These ladders reflect the programs that align employees'
As expected, no more than one- organizations' job families/functions expectations with business realities.
third of managers and technical staff and define progressions within and These career ladders must be
view lateral job movement as career across them (see Figure 4). rooted in the organizational context
advancement. However, more than These career ladders serve three to work. Deployed appropriately, this
50 percent of them consider the fundamental purposes: career framework can be central to
difficulty of transfers or lateral 1) Inform associates and managers the strategy of creating an engaged
movements a significant barrier to of the multiple career tracks and productive workforce.
career advancement. available. This helps them understand
the rich universe of opportunities
and empowers them to plan their Conclusion
The way forward: A Towers Employees' hitting a career
own careers.
Watson perspective 2) Identify advancement oppor- advancement ceiling poses a serious
As there is not enough room at the tunities in terms of both lateral and challenge to companies in India. An
top for everyone to be promoted vertical movement. Supported by overemphasis on managerial careers
up, offering multiple career tracks is clear competency requirements, may be one factor driving this
one of the most viable solutions, these ladders also help employees persistent trend. Today's workforce
especially for 25-to-35-year-olds. understand their natural talent and will not fit into a traditional
Employers can restructure their move in the direction of their own organizational hierarchy. One solution
career paths from the traditional competencies. This is a business is to adopt multiple career tracks that
model of grade promotion to enabler in terms of developing a identify different job families/
competence development. competency-focused workforce. A functions and thus open up career
In our work with clients who have diagram like the one in Figure 4 movement within and across these
successfully taken career illustrates how these career ladders jobs. For the strategy to succeed,
development thinking to the next help identify potential career paths. however, organizations must
stage, we help them redefine careers 3) Help companies forecast their carefully align all aspects of talent
in terms of parallel ladders in line workforce requirements at various management (including rewards)
with their business and operating stages of the ladder and build HR with the new career models. HC
46 ■ December 2011 www.humancapitalonline.com ■