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Research Highlights

Career Transition and Outplacement in Difficult times: The India Story

Testing Times Ahead

As we cross the half year mark of 2013, it is plain that the recovery from the global recession continues at a steady but frustratingly slow pace. Unemployment remains high in many global labor markets, and job growth seems stalled as employers continue to navigate an uncertain economic environment. With a mandate to do more with less, organizations are under severe pressure to manage/reduce costs. While at one hand investments and job creation has dipped, employees are also laid off. Landing jobs is also taking longer since employers are now cautious about who to choose and where to place them. But more so, how are we able to retain the employer brand and values?

About Right Management Survey

Right Management is a pioneer and a leading firm offering career transition and outplacement services. We work across countries with organizations to support roughly 100,000 laid-off employees across the globe every year to deal with the change and transition successfully.

Given the economic context in India, to better understand the impact of this solution, Right Management India conducted a survey (June 2013) among three unique groups 1. Business & HR leaders 2. Employees who were offered career transition and outplacement services referred to as “Impacted employees” 3. Career coaches

who coach impacted employees. We also compared the findings for trends from the previous global survey conducted in 2010.

Key Trends for 2013

#1 Stigma associated with job loss. The propensity of impacted employees to advocate the services to others is at only 57%. When probed, candidates respond that they do not want to be identified as employees who were laid off. The employees believe that being identified as laid off employees could hamper their employability despite layoffs being mostly due to organization / business needs and not performance reasons.

Our experience also suggests that prospective employers are reluctant to evaluate laid off candidates. Whereas what we have learnt from our past assignments is that non performers are not offered Career Transition services, but are put on Performance Improvement Plans (PIP).

#2 Confidence building is key. Companies invest a lot in hiring the best talent in an extremely competitive talent market. Hence being well prepared for interviews is important. The Career Transition program aims at ensuring the employee is well prepared. The survey says that there was a 3x increase in confidence levels of employees after they took up the service. This also indicates a significant loss of confidence on being impacted as most of the times the news comes as a shock to the individual.

Fig. 1.1 Key Findings from Impacted Employees

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#3 Job landing. Since Job search support is a key need for the employees, we reviewed the findings on job landing statistics. The survey shows overall 85% of the impacted employees have transitioned successfully, of which 70% have landed a new job, 12% have been rehired by their employers, and 3% are self employed. In the balance, 5% have retired and 12 % are still in transition.

Fig. 1.2 Career Development Model

Ending

NeutralZone

NewBeginning

Shock & Stress

Feelings such as anger, frustration

and confusion

Ambiguity anddiscomfort

Creating a visionActing

Optimism

Risk-taking

Influencing

New Ideas

Acceptance

#4 Networking through social, personal and online channels is the mantra. The networking approach works in the India Job market. We firmly believe job landings will be faster with networking, and this is a priority coaching area for us in the Career Transition Programs offered. This was confirmed as well from the survey, where it was observed that 43% of the employees landed jobs from networking (39% from traditional networking, 4% from online networking) and 18% from directly approaching companies. Also only 31% got jobs from traditional sources (agency recruiting firms (13%), internet based job boards (18%)). 8% of the employees secured a job from referrals and none (0%) from newspapers and periodicals advertisements.

#5 Family ties. 48% of the employees relocated to another city for their new jobs.

Career Coach Insights:

• “Employees need emotional support in face of the company’s decision to layoff. Providing them a career coach allows them to vent out to a confidant, who is ready to listen to them and share an unbiased opinion (as a neutral third party) on how to move on, thereby driving acceptance of the decision.”

• “Once the career coach has established a rapport with the employee as an emotional anchor, he/she is able to help the employee to identify their unique strengths and suggest a customized approach on planning the next steps.”

• “Networking and negotiation skills are usually the most critical parameters which influence the employee’s ability to find a suitable role.”

In our experience job landings could be higher if the employee was mobile. We understand that personal reasons including children’s education, working spouse, etc. are paramount. This delays job landing.

#6 Flexibility is key. We coach impacted employees on how to leverage their transferable skills to increase the range of opportunities they can explore. Of the employees who took up new positions, only 35% of impacted employees changed their sector and only 22% changed their function. We often note that employees who have high adaptability and learning agility, are able to land a job into a new function, and importantly land jobs faster.

#7 Layoff is not the end of the road. We build confidence and skill in employees on how to negotiate for the next role. Using these abilities, a good 39% of the employees were able to negotiate a higher position, while 57% were able to maintain

the same position and only 4% had to take up a lower position. This clearly tells us how employees can get a role of their choice and liking, if they are able to showcase their strengths.

#8 Offering career transition service preserves employer brand. We believe that given the shortage of skills and an extremely competitive market, it makes business sense to offer a Career Transition program. In the survey, 74% of the impacted employees view the previous employer’s brand as favourable on account of the career transition services provided to them despite having lost the job. Considering that these impacted employees will continue to be your organization brand ambassadors even after they step out, it is critical that they have a positive experience throughout.

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Triggers for Transition and Outplacement

We had polled the sponsors of career transition program on what triggers career transition and outplacement activity in firms. The Top 3 reasons mirror economic sentiments.

Reasons to Offer Transition and Outplacement Services

#1 Companies offer this service for right reasons. 80% of the program sponsors agree or strongly agree that it is the right thing to do for a responsible employer – matching organization values. This mirrors our global research (2010) where 71% had agreed. Only 10% of the program sponsors agree or strongly agree that everyone else in their sector/ industry

is doing so (peer pressure to do it), hence they must as well.

#2 Engagement of retained organization is key 62% of the program sponsors agree or strongly agree that the outplacement program helps maintain the morale and sends positive signals to the remaining employees. Our global research reports 69% agreement. We note organizations we have worked with are able to also hire fresh talent for new technologies despite a layoff for this very reason.

#3 Employee need skills to transition 62% of the of the program sponsors also agree or strongly agree that partner support ensures impacted employees receive necessary skills needed to transition quickly. Our global research reports 67% agreement.

Fig. 1.3 Coach Insights: Skills needed across levels

Reinvent themselves, introspect using

psychometric tools

Positioning in the job market, networking skills

Exploring a second career with coach support

FinancialPlanning

Coaching on transferable skills (to explore wider

options)

Personal branding &Role Negotiation

Reflection onleadership style

Competency based interview practice

More emotional anchoring to build back

confidence

Support with basic skills like resume writing,

interviewing

PeerNetworking

Senior Management Middle Management Frontline

Effectivecommunication

Triggers for Downsizing

Trigger for Rightsizing

48%

45%

21%

Weak economic forecast and hence change in growth

Product or service is no more competitive/relevant –leading to redundancy of skills

Decline in business due to change in government and /or policy decisions

52%

48%

48%

Rationalization of employee costs

Reduction in product demand due to changes in market dynamics

plans

62%

52%

Global imperative to reduce costs /head count across the board (across locations and levels)

Merger / Acquisition of Joint Venture Lead, e.g. industry consolidation leading to redundancy of

positions

0% 10% 20% 30% 40% 50% 60% 70%

Trigger for Rightsizing

Fig. 1.4 Triggers for Rightsizing

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Conclusion

The Manpower Talent Shortage Survey 2013 shows that India is among the top 3 countries with a talent shortage. Despite the slowdown in hiring, talent shortage is actually up 13% from the previous survey. It is no surprise that the work on matching talent pools to jobs is a significant area for governments and companies.

1. Given the skills shortage, if prospective employers consider the impacted employees they can really overcome this issue. We are promoting inefficiencies in the job matching market by not considering a sizeable pool of highly qualified and employable talent pool of laid off employees or perhaps not fast enough.

2. Impacted employees need to deal with the change, show flexibility and willingness to relocate as job matches will take longer and be more challenging.

3. The survey indicates one of the top reasons to offer career transition and outplacement services is to retain engagement and retention of talent in the survivor organization. Given the skills shortage in India no organization can afford (a) of loss of employer branding and ability to attract talent and (b) leakage of critical talent. Importantly as the survey suggests, the employers see the best ROI from career transition “as the right thing to do for employees who are impacted as responsible employers”. As is seen in the client testimonial, acceptance of the practice over time makes it part of the corporate value of responsible business leadership. by J. Karthikeyan

Vice President - Consulting Services

Bangalore, India

w We could have handled the outplacement process internally, but the employees needed an expert to build in them the capabilities required to transition outw Partnership is key between the client and a Career Transition partner. We were able to speed up the landing process by providing leads and connections in the industry to our partner, and share skills and interests of impacted employees. Regular reviews and support on progress helped us mitigate issues

w The partner’s expertise in candidate psychometric skills assessment and matching this to job interests helped the process even more. w ROI (Return on Investment) is not so much about reduction in litigation risks and opportunity costs saved on ER (Employee Relation cases), we believe this is the right thing to do as a responsible employerw In the first wave, managers said this is desirable over and above severance, in the second wave having experienced it managers said we need it. By the third wave it became institutionalized, with everyone agreeing this best reflects our corporate values and culture.

Krishna BhagavanDirector and Country Head HR Motorola Solutions

ClientSpeak