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 / Winter 2010 / Issue 61(originally published by Booz & Company)


The Thought Leader Interview: Vineet Nayar

Then, right after I took over, a customer canceled a contract. It was a defining moment. With my entire team, I went to see the customer. We had not done a good job, but there was more to it than that. The customer said, “Vineet, your employees did nothing wrong as individuals. But your organization did not support them.”

At a second meeting two months later, the same customer congratulated us for our work on a different contract. What was different about this project? We had given our people what they needed to succeed. I’m not saying management leadership doesn’t have a role to play, but we started to recognize that the value that employees deliver through their interactions with customers was far more important than the attention it was getting at HCL.

Calling our policy Employees First, Customers Second was our way of defining this attention as our primary aspiration going forward. It was also a statement about the relationship between leaders and the people who execute. How do you maximize the experience that customers have in the value zone where they meet your company’s work? We think the answer is for management to see itself as an enabler, and for employees to see themselves as “doers” with a great deal of accountability and autonomy: the ability to choose much of what they do. In this way, we create organizations in which employees are aligned with the customer.

Our management team loved these ideas because they were unhappy, and they were ready for change. The number of people who are waiting in any organization for a transformation is significantly more than one can ever imagine.

S+B: As long as they recognize it’s a genuine change and it won’t make them vulnerable.
That is a very important point. During the recession, from September 2008 through January 2010, I don’t think many other global IT companies grew at all. They did not work with their employees, and in many cases, they chose to cut their costs primarily through top-down decisions such as across-the-board layoffs. Meanwhile, the moment the recession hit we went out to our employees and said, “We have a problem. We’re going to solve it together.” We had thousands of ideas coming in, and we implemented them. Most of them were operational: There were no new products, services, geographies, or contracts. But HCL grew 23 percent and increased global market share by 21 percent. Our employees felt they were a part of everything we were doing, because of our inclusive approach. Even if it may take a bit longer to arrive at decisions, this approach helps ensure that implementations are smooth and that initiatives are sustained after the initial hype.

S+B: Do you think Employees First, Customers Second would make sense for most businesses?
I’m not sure it is relevant for everybody. All I am saying is that businesspeople need to give the management–employee relationship more thought. The experiment has worked wonders at our company, and increasingly others are asking, Why not?

Instilling Transparency

S+B: How did you make employees feel comfortable challenging their managers and you?
We used the 360-degree appraisal technique as an employee development tool, but not the way it is typically used. We created a 360-degree process where anybody can give feedback to anybody, including to me. We post the results internally so that all employees can see them. Good or bad, we all learn from the results. It’s open, it’s transparent, and the impact is positive. We find that this practice is motivating people to change their behavior. They try harder.

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