The Real Reason behind New Hire “No Show” in Indian IT Industry
HR departments in the Indian IT industry are getting upset due to "No Show" of new hires. According to a Business Line estimate, in June 05 approximately 60-65% of new hires didn't show up after accepting a job offer (in the Indian IT industry).
No Show Behaviour is unprofessional. HR Officers are feeling pinched, blaming candidates, and setting up strategies like (1) not negotiating if a potential hire has an additional higher salary/title offer (2) building a shared database of "No Show" individuals. Yet, few HR folks are looking inward to find out the real reason why some new hires indulge in "No Show" behaviour.
I think the real reason is the insecurity bred into employees by IT companies when IT hiring is or actually was low e.g. pre 1998 and 2000-2004. During the non-boom times hiring companies hold substantial power and several companies abuse it. (1) A few companies indulge in "Lalaji" behaviour (Owner and/or Senior Managers are virtual rulers in a company; employees are merely lucky to have a job and hence a life with meager salary and no raises. (2) Employment avenues are limited in India because of a large educated population. Qualified candidates compete fiercely for limited beginner and middle level positions in decent companies. Starting salaries and annual salary revisions are therefore tightly controlled by hiring companies in non-boom times. Even joining terms and exit terms are dictated unfairly.
People remember their scars for a long time — not just the ones that they get directly but the ones their friends, elder bothers/sisters, well-wishers get. During IT hiring booms new and employed individuals in the job market figure out that it is payback time.
The "No Show" phenomena is not created by employees alone. The Indian HR fraternity has a definite history and a hand in it. For long HR departments have held a herd mentality because of the rich pool of qualified job seekers in India. Profit Sharing and the ESOPs culture didn't exist in India until US MNC's brought it here. Legend is that FC Kohli, former Chief of TCS once apparently boasted that he could run the company on freshers alone. (Interpretation: If you gain experience and want higher salary or more challenging work you can leave. We can hire & train a fresher and get your work done.) One ex-Engineer of TCS shares his disappointing experience on his blog the iconoclast:
Here's how Indian IT companies operate…Hire engineers in bulk, never mind that they are not computer scientists or electrical engineers - if they can write a few lines of code in C/C++ and are academically decent, they're hired….One important thing to note is that the HR in most IT companies dont give a damn about individual interests. They will put you wherever they need someone to slog for them. I've had one HR person tell me that they will put me in a project where they get maximum money, regarless if I am interested or not. And they wonder why so many people leave!!!
Attrition Starts from Day One
Someone once wisely said "Attrition starts from the day an employee joins a company." I take this argument a step further. I believe that attrition starts the moment you hard-bargain with a potential hire. Or, when you peg a potential hire's salary on a lower number that the wrongly-informed potential hire suggests; instead of offerring something that would be fair to the person (hires accomplishments, background, and company's existing salary bands.)
The No-Show phenomena during a hiring boom is thus part of a cycle. Its a cycle that begins with bossy or unfair behavior with employees or new hires during the low hiring period and ends up in No-shows when hiring picks up. Human beings tend to behave fairly when they are treated with consistent fairness over an extended period of time. To reduce or remove No-Show trends, HR folks will have to take long term corrective actions rather than short term tactical measures.
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6 opinions for The Real Reason behind New Hire “No Show” in Indian IT Industry
BizzBites.com
Jan 31, 2007 at 1:39 pm
With no shows at what seems to be an all time high, author of TheBizofCoding says that IT industry HR departments need to be introspective and take partial responsibility for this phenomenon.
Anonymous
Feb 5, 2007 at 4:19 am
I respectfully disagree with most of the text you have written.
No Shows are only because :
1. Employees want to bargain much more and keep more than one offer in hand
2. Once they have one “good” offer, they are generally serving the notice period - typically a month on average. They use this time to search for alternatives, even while they have accepted the first offer.
True, it is a cycle - but the reason is not insecurity but trying to gain as much financial benefit as possible in booking times.
HR is at fault, but so are employees - who think more of how much they are being paid, rather than what they will be working on. I know of a person who wants to leave his company (joined a couple of months ago) because of bad project management there, but, on the other hand, does not want to apply to a leading MNC (which rewards employees equitably) because the latter will not pay the high salary (above industry standards / his standards?) that his current company is paying.
ujwal
Feb 5, 2007 at 9:44 am
“No Shows are **only** because Employees want to bargain much more and keep more than one offer in hand”
I wouldn’t agree with the “only” in your comment. The issue is No Show has a definite root cause in HR departments hard bargaining. So even if you like the new job your stomch is hurting because you know that to gain financial independence, buy an apartment, car, prepare for marriage and children etc you will need more money. Then you look out during the notice period.
I would agree that there are some bad fish in the pond who are only driven by the next raise and have no committment to the value add they bring to a company or take away when they keep jumping. However, why do HR folks then interview constant jumping jacks? CVs are easy to scan and find out if the guy has a history of randomly jumping jobs within months. Right?
Net net — when you are hiring and throwing away job hopper CVs you are left with a fairly good pool of CVs. Then your hiring process determines how pained the new hire feels about the salary offered. Given the size of competitive potential employee pool — how much can a candidate negotiate? HR folks typically give soft lies like “internal equity” or “limited budget for the position” instead of saying “take it or leave it.” All Mangement values gyan on “respect for employees”, “employees our core strenght” is forgotten when salary negotiations happen.
I know of tons of talented engineers who are working at “brand name IT firms” for below industry average salaries — and desperately looking for another challenging job that will “also” pay them well. Btw: it is common for “brand name IT firms” to pay below industry standards because they have the brand and by inductive logic better quality work…Since the job market is usually competitive in India — finding another good company which would pay well becomes a tough search.
Again,I strongly believe that untill respectful mutual standards emerge in Indian IT jobs market — amongst HR folks and employees — “No Shows” situation will continue to remain at the same levels.
Anonymous
Feb 5, 2007 at 10:00 am
HR in most firms (especially the MNCs) is outsourced. They hardly care who is getting the job, as long as they are able to recruit as many people and get their commissions. This is true in many of the “branded IT MNCs” too.
As far as “financial independence” is concerned - no, it is more about gaining “parity” with peers. You do not really “need: an apartment to gain independence. Nor do you need a car. It is just that we are being forced into an ever-increasing rat race of competition - within the industry, outside with MBA school pass outs, with 150k salaries for freshers. All based on “soft” ware and fluff in most cases, while the mainstay of the economy - manufacturing, agri - continue to grow at a more modest rate on an average (in terms of employee compensation)
Prashant
Feb 23, 2007 at 10:29 pm
Well, i agree that this insecurity in the minds of employees has been created by the Resource managers and HR policies of some of the top companies respected by people in India. Like we were hired on campus by a top 10 Indian IT firm before a year of completion of our engineering degree. So we felt at ease a little about our future. However, to our surprise, the company did not send us the offer letter, which it promised to after six months of our interviews. So we were held in mystery. On trying to communicate with them regarding our status, they said nothing can be guaranteed for the moment as the markets are turbulent. We had to wait for six months after finishing our college to get invited by this company, but only on training. The HR people said that a job is still not on offer and that they will see if there were projects available and whether we performed well during training. This all, after they had taken 3 round of interviews on campus. Now hows that for an employee?
Honestly, i believe that the so-called branded and reputed IT firms in India have been playing on the insecurities of workforce in India for a long time. The owner still hold on to the attitude of “Maalik” and the intellectual people to be kind of “Workers” who work for satisfying their basic needs and are meant to be exploited. Now, what do you expect from the population that is getting many opportunities for the kind of skills they possess and those that were never recognized earlier? Why would they not keep two or three options at a time and dump a firm for the kind of benefits they see in joining other firm?
My last few words, “It’s time for the owners and Resource Managers to wake up before it’s too late for them”. When juniors are aware of the fact that their seniors dumped a position in a particular firm for some of it’s unfair policies, they wouldn’t be keen to take up a job either in that firm.
TheBizofCoding
Apr 24, 2007 at 4:23 am
Here are 5 useful tips for techies — especially those who have less than 5/6 years of experience in the IT industry. These tips are based on my conversations with several IT industry colleagues over the years; and some observations abou…
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