Rethink Management-Employee Relationship

News Updates

SAN DIEGO—Business leaders who truly inspire, enthuse and induce fundamental changes in the businesses they operate come along once or twice a generation. Vineet Nayar, chief executive officer of HCL Technologies Ltd., appears to be just that kind of leader.

Nayar spoke here during the June 29, 2010 general session of the Society for Human Resource Management (SHRM) Annual Conference and shared his vision of what it takes to inspire employees and build an organization that is recognized as being a global leader and as having one of the most progressive and “modern” management styles in the world.

Nayar told the audience that several years ago he began assessing the situation of his company and realized that he, along with the company’s other managers and employees, were “standing on the ledge of a building that was on fire.”

He realized that the company needed to change the way it operated. Nayar told the audience that the inclination of most would be to try and climb to safety, but that was not the path he wanted to take. Instead, he chose to confront the problem.

“Fortunately or unfortunately, HR and its practices are an experiment of what works or what doesn’t” he said. “So we took a chance and embarked on a new model that we call ‘Employees First and Customers Second.’ ”

By focusing on the needs of employees and by encouraging and inspiring them to do their best, HCL soon began experiencing remarkable growth and performance. Since 2005, the company has quadrupled its number of customers, and customer satisfaction has improved by more than 50 percent. Nayar wrote a book on the experiment, called Employees First, Customers Second: Turning Conventional Management Upside Down (Harvard Business Press, 2010).

Nayar said the key to the “employees first” model is to invert the traditional business pyramid and make management equally accountable to employees. The new business model should therefore begin to look more like a sphere than a pyramid.

“We live in a world where we value the democratic form of government, yet we make our businesses autocratic in nature,” he said. “You can accept what I’m telling you or you can reject it. I only ask one thing of you today: that you just think about it.”

Michael R. Losey Research Award

During the opening moments of the session, Robb Van Cleave, SPHR, IPMA-CP, chair of the SHRM Board of Directors, joined with William A. Schiemann, Ph.D., chair of the SHRM Foundation, and Howard Winkler, SPHR, chair of the HR Certification Institute, in presenting the Michael R. Losey Human Resource Research Award. Wayne Cascio, Ph.D., received the $50,000 award for his groundbreaking research in the organizational effects of downsizing, quantifying the financial effects of HR policies and practices, and employee turnover determinants and outcomes.

Winkler and Schiemann called Cascio, who holds the Robert H. Reynolds chair in global leadership at the University of Colorado-Denver Business School, “a giant in the HR management profession.”

“Our winner epitomizes the bridge between research and practice in his writing, service, consulting and professional advisory capacity,” Schiemann said. “He is a great thinker and thought leader in our profession. He’s a colleague and someone that I am proud to call friend.”

Cascio said he was overwhelmed to receive the award and acknowledged that the award’s namesake—Michael Losey, SPHR, former president and CEO of SHRM—was a true visionary and one of the most passionate advocates for the HR profession.

“I am humbled and honored to receive this award and help in some way to contribute to Mike Losey’s vision,” Cascio said.

Cascio demonstrated his commitment to the HR profession by announcing that he would donate $10,000 of his prize to the SHRM Foundation.

Bill Leonard is senior writer for SHRM.