Sunday, September 9, 2012

Employees First, Customers Second by Vineet Nayar

EMPLOYEES FIRST, CUSTOMERS SECOND - turning conventional management upside down by Vineet Nayar (2010) Harvard Business Press, Boston, Massachusetts, USA, Pages 199.

Vineet Nayar who took over HCL Technologies as CEO from Shiv Nadar, has brilliantly portrayed his personal belief and conviction in the thought and practice of considering employees over customers.  As a teacher of OB, Strategy and HR, I always had this view of prioritising employees over customers as they are the ones who put efforts to satisfy customers.  A satisfied employee only can deliver satisfaction to the customers.  Nayar's application of this concept (EFCS - Employees First, Customers Second) in HCLT further reiterates my belief in long standing assumption with which I have been living all through these years.  This book is a great treat to all HR teachers and practitioners who can pick up the methods and manners in which Engagement and Empowerment can be practiced by the organizations.

The book is divided in 5 chapters apart from introduction, notes, acknowledgement etc.  The foreword is written by late CK Prahalad, an internationally aclaimed scholar of business strategy, formerly known for core competence (competing for the future) and recently known for BOP (Fortune at the Bottom of the Pyramid) concept.  The introduction of the book provides the motivation of writing this book. 

The book gains more ground even as it questions a long accepted belief of management that the dependence of business is on customers, hence the customers should be the prime focus of strategies and policies of business organisations.  As the title suggests, the author strongly believes that it is the employees who are more important than customers, it is employees who should be the prime focus and then comes the customers.  His practical experiment at HCLT makes the case more authoritative.  As one reads the book, one keeps gathering strong processes to really make it happen and successfully engaging the employees in achieving the business goal. The feed-forward communication holds the key to drive the employees to get engaged and dedicated to the cause of organizational commitment and performance.  

The path so designed and followed by Vineet is based on his learning and experiences from his personal life, his growing up, his family, school, college and friends, his visits and interactions, which does find place in the book at several places as they helped him developing an action plan.  It tells us that every event of our life, every interaction of ours, every action of ours get reflected in what decisions we make.  So the internal as well as external factors contribute in shaping a successful leader.

The book discusses the transformations as they happened as the result of following EFCS approach. The involvement of employees from micro to macro level for doing what is good for the organisation is the step followed as 'All aboard' and these agents become the transformers for introducing change in the organization as well as contribute to growth of the organization.  The author advises to use mirror for better reflection and to see the events of the past (Mirror Mirror exercise) and warns to get away with the excuse culture.  Similarly engaging customers also is said to be important for organizational responses and growth as well as to serve a great value through putting employees first, customers second, and management third.  The examples of Facebook and Google for bringing out innovated products and services are well placed in the book.    

The employees need to be driven to believe that they are most important for the organization, they are the first players and through this they have to have a sense of pride of belonging and owning the organization.  As the author mentions -  pride can be a great source of strength when coupled with a desire to change. Change is the only thing which is constant.  Organizations imbibe change in order to respond to market and customers.  As society changes customer expectation also changes and the organizations face this great challenge to respond to customer’s expectations.  Successful organizations develop a culture of change and nourish this culture through strategies and policies.  The way HCLT took initiatives to develop such a culture based on mutual trust is really remarkable and it was possible through the concept of EFCS.  Trust quotient has to be improved all through ranks in the organization and through leading by example one has to develop a sense of acceptance among the followers so that they can believe that their boss is a trustworthy person. 

The four dimensions of trust - Credibility, Reliability, Intimacy, Self-orientation as mentioned in The Trusted Advisor by Maister are well cited by the author in the book.  It is to be followed with employees as well as with customers, as both play strong role in building the organization.  On one side the organization communicates the sense of trust to employees and on the other hand it has to communicate it to the customers as well.  In the model of EFCS, the customers have to know why do they come second (as against common belief that customer is always first - because the customer is King, and the King can do no wrong, hence the customer can do no wrong - thinking) and it is the responsibility of the leader to positively communicate and convince them why do they come second. 

The culture of trust is learnt at the first institution called the family and the values one learns in the family get reflected in one’s behavior as one takes charge of activities in an organization.  Apart from trust, in order to build a sustainable organization one has to be transparent in his/her approach as elaborated by the author through the Amsterdam Window experience as he mentions – A transparent house, has a dramatic effect on the culture inside.  In fact through this experience he successfully communicates the advantages of being transparent.  He introduced a system at HCLT which connected the CEO with all its employees through a exclusive networking group for HCL employees called ‘U&I’, which seemed to have worked quite successfully there.  This approach sounds unique and through leveraging technology the organization provides an ear to the issues of concern for all its employees. 

The fifth P of marketing viz., People (employees, partners, customers) play an important role in the life of an organization.  The concept of inverting the organizational pyramid is all centered on people as experimented at HCLT through reversing accountability by concentrating on enabling functions, the managerial chain of command all the way to the CEO, and the influencers who are not part of hierarchy but are critical to achieving the desired wow in the value zone. The company introduced Smart Service Desk (SSD) to resolve issues related to employees quickly by using technology and expertise of employees. It was based on common practice of customer care service provided to the customers.  SSD was meant to resolve problems and issues of employees.  Initially the employees at HCLT were little skeptical about the whole scope and operations of this desk as to if any employee has a problem/issue with his/her boss (upto the level of CEO), how would it be presented, processed and resolved.  But slowly it got working well and as mentioned they were resolving thousands of transactions each month at an amazing rate. This further got a concentration on zero ticket call for evaluating employee’s performance and they willingly and successfully followed 360 degree model keeping the Happy Feet. Inversion of organizational pyramid

The mention of the major achievement (during the transformation phase at HCLT between 2005-2009) towards the end of the book is the outcome of EFCS approach.  It makes the model incredible, practical and convincing. Collective wisdom outshines individual judgment.  I truly loved this statement which is the core of the book entitled The Wisdom of Crowds by James Surowiecki. EFCS model traces its root in the work of Surowiecki which got Vineet thinking and using it while developing the whole concept.    Though the book is based on the practices followed at HCL Technologies which is an IT company, however the concept is well appropriate for any organization dealing in products or services in any sector of the economy. 

EFCS through its engaging appeal makes a strong case for prioritizing employees over customers.  It is possible through developing committed systems and processes for engaging the whole employee and not just his/her performance.  The role of a leader is very crucial to make EFCS model successful as there as to be a culture of change, trust and transparency which has to keep the CEO under attentive scanning of their employees.  The openness of CEO and a sense of humility as portrayed in the acknowledgement section of the book towards the end is just unparallel.  Vineet Nayar gets full marks for writing such a wonderful piece (acknowledgment), acknowledging all concerned individuals. This is what takes to envisage a concept called Employees First, Customers Second.

(finished reading it ...8 Aug 2011).

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