WHY
SHOULD A COMPANY BECOME A GREAT PLACE TO WORK?
Participation
in the study doubled over last year and there
is also a marked improvement in the quality
of companies that participated. This study
has, therefore, become a matter of strategic
importance from the point of view of employer
branding, attracting, and retaining the right
talent. Over the years to come, we envision
our survey as the final basis and ultimate benchmark
for assessing the employer brand of any organisation.
And what better way to establish this than by
asking the employees themselves? An overwhelming
percentage of rating criteria for a company
is the quantitative feedback given by employees
(and supplemented by their qualitative comments-
refer methodology section) Whether it is a potential
customer wanting to assess the employee engagement
levels of a BPO or a campus trying to determine
whether a company should be a Day 0 or a Day
1 company, the Great Place to Work® list
will increasingly determine the flow of talent.
And let’s face it, if apart from acquiring
and retaining customers there is any other critical
challenge, it is acquiring and retaining employees.
Great
workplaces benefit from the higher level of
trust that is developed between employees and
management. Organization leaders who foster
a high level of employee trust in management
see increases in employee commitment and cooperation
which leads to increased quality, productivity,
and profitability. Typically, the following
trends have been observed across Great Places
to Work around the globe:
They
receive many more job applications than others
in their industry so they can select candidates
with the most desired skills from a broad pool
of applicants.
They
experience a lower level of turnover than others
in their industry (turnover cost for one mid-level
position in the U.S. is estimated at $40,000
to $100,000).
They
see reductions in health care costs due to reduced
negative impacts of stress on employees.
They
foster greater innovation, creativity and risk
taking, supporting employees’ efforts
to be on the cutting edge of their industries.
They
benefit from higher productivity and profitability
than their competitors due to the higher levels
of employee cooperation and commitment.
Most
importantly, there is direct relation between
companies that become Great Places to Work and
superior financial performance. An index
of Fortune’s 100 Best Companies to Work
for, from 1998-2002, yielded a return of 4.86%,
if held for four years. During the same
period if an investor reset his/her portfolio,
to update his/her index annually with the latest
list of Best Companies to Work for, the investment
would have yielded a return of 9.86%.
This is compared to a meager -0.56% by the S&P
500 during the course of the same period.
While
it is still early days in India to project trends
there is no reason to doubt that what is true
for rest of the world will not apply to India.
