Some Indian IT services firms, including Wipro and Cyient, are changing their performance metrics to measure employee productivity at the back of COVID-19. With work from home (WFH) becoming the norm, experts and executives said companies need an effective way to ensure productivity in the absence of face-to-face communication.
For employees, it would mean a rigorous assessment process and it would be closely linked to their promotions and hikes once implemented, say experts.
The pandemic has brought significant changes to the way IT firms function. They have moved from primarily on-premise work to WFH for the majority of the 50 lakh workforce in the IT sector in two weeks before lockdown was implemented.
Hiring and on-boarding have gone virtual for freshers and laterals without the executives meeting them in person, a first in the industry.
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At this juncture, experts said, companies are looking to remove the subjective aspect of performance measures and make them more objective through clear-cut metrics.
What are the changes?
During a recent analyst call, Wipro CEO Thierry Delaporte spoke about driving a high- performance management culture in the company.
Saurabh Govil, Chief Human Resources Officer, explained what the performance-driven culture entails. It would include crisp key performance indicators and measuring people against them and executing on that. The idea was to remove the “defused KPIs”, which was leading to weaker performance management.
What Govil meant as crisp KPIs, say experts, is probably removing the subjective aspects and replacing them with clear objectives.
Karthikeyan Natarajan, COO, Cyient, a Hyderabad-based IT services firm, explained that employees can no longer be measured based on the time they are spending on modules assigned. That might not be an accurate measurement, he pointed out.
For instance, employees were expected to put in 9 hours of work in offices before COVID-19 to take into account the travel time. Hence, efficiency was measured based on the time spent. Now with WFH, this does not make sense, point out executives.
“So you are changing the narrative of what you are measuring earlier versus what you are measuring now,” he added.
Take for instance, testing efficiency. “Instead of saying we have done 2,000 hours of software testing, can we say our testing efficiency is 97 percent? So that means we can get our bug fixed before we deliver it to you,” Natarajan explained.
Another example is how a senior manager handles client accounts. Not all companies had clear KPIs set for all performance goals.
Before COVID-19, Aditya Narayan Mishra, CEO, CIEL HR Services, explained that the metrics, say, were measured on a scale of one to 10, depending on how his/her supervisor perceived the work based on interactions they had, and their observations. In a way, metrics were more subjective than objective.
“It was because the supervisor had more opportunities to be directly involved and interact,” he added.
But WFH had made it impossible. Now, companies are looking at introducing clear metrics that will measure employees based on their performance and outcome. In the example of handling a client account, the metrics could include cycle time, and how error-free the finished project is.
However, given that the landscape is new, these metrics would evolve over time, experts pointed out.
Changing the way how project success is measured would take time, not just for employees but also for clients.
Take the example of testing efficiency. Instead of saying 2,000 hours has been spent in a project, the new measurement would be testing 25 modules in a project and how efficient and bug-free the final delivery is. This is a new metric and clients have to be convinced as well to move to the new model.
“I think it is really going to evolve as customers start understanding the unitisation model and the catalogues makes sense,” Natarajan pointed out.
What does it mean for employees?
On the employees’ front, it requires a mindset change. “We are setting some metrics, we are setting some benchmarks and…making sure everybody understands the metric that would be measuring the success of engagement with customers,” he added.
So it would be sometime before the new change comes into effect. But once it does, employees are likely to see stricter actions -- be it doling out handsome hikes and promotions or even increased performance based layoffs, experts said.
Govil from Wipro pointed out: “We will not shy away from taking bold and tough decisions – be it upgrading by bringing people from the bottom of the organisation to the top or by changing people where they are not able to meet the performance in the new role."