An evening with Mr T Muralidharan

About Mr Muralidharan

Mr T Muralidharan (TMD) is the founder and Chairman of three-decade old TMI Group. TMD holds a B. Tech from IIT-Madras (1979), Post- Graduation from IIM-Ahmedabad (1981) and a Bachelor of Law (LLB) in Osmania University (2021). He is a serial entrepreneur who has launched many successful start-ups.

TMD has authored two bestselling books: “An Expert’s Guide to Your Right First Job” published in Feb 2015 and “An Expert’s Guide to top 101 Entry Level Job for Graduates and MBAs” published in August 2016, both by Rupa.

About TMI

TMD has built the TMI Group into one of India’s leaders in its domain with customers across IT, BFSI, Manufacturing and Service sectors in India, Japan, Germany, Middle East, Africa, Singapore, and Central Asia. TMI Group has placed 1,00,000+ Managers and skilled 200,000 + executives in India over the last 30 years.

With 3000+ employees and pan India presence, the TMI Group is a pioneer in Talent Acquisition, Talent Development and Learning Sciences. Performance consulting, HR Analytics and Robotic Process Automation are the recent additions to the TMI Group offerings.

Introduction

In the last millennium, we have advanced in terms of science and technology. But as Edward de Bono has mentioned, human behaviour has not changed much. We are more concerned with WHAT IS. But we find it difficult to think about WHAT CAN BE.

Performance management

For many people in HR, performance management is essentially the annual performance reviews done by line managers and the process is managed by HR.

For a line manager, performance management is about driving the team to meet the targets and announcing incentives to make it happen.  For HR, it is about managing the process of appraisal.

Both this approach is flawed for three reasons:

• Performance indicators are lag indicators. They do not have any predictive ability.
• Performance fluctuates wildly. Some people are extraordinarily productive while many others do not deliver.
• The performance management process does not tell the employees the corrective action. They are left to figure it out for themselves.

At the same time, there are performance pressures on front line employees. This results in high attrition rates among both performers and non-performers. A lot of frustration is evident among HR and line managers, and they often blame each other for the state of affairs.

Four big trends

Four big trends are changing the world of work.

• Automation is disrupting the way work is done.
• Work from home is changing the terms of engagement between the employer and the employee.
• New employment models like Gig working and work from home are reducing the employee loyalty to employers and tenure in organisations.
• The Front-Line workforce largely relies on and trusts their peer group more than their bosses or the older generation.

Performance Variation

Front Line Executives and Managers (FLEM) - both in-house and on third party roles - constitute over 50% of workforce in service organisations. They are directly involved in sales, customer service and back-office roles. The performance variation of FLEM in the same role, with the same experience and with the same entry criteria - is as high as 8X to 20X.

People Performance Modelling (PPM)

Performance appraisal metrics today focus on lag indicators i.e. “output” performance. They do not throw any light on “corrective” action. Supervisor reviews of performance are not root-cause centric and hence no corrective action emerges.

People Performance Modelling (PPM) helps in identifying the root cause of low performance. PPM tries to understand how performance really happens on the ground. PPM tries to connect the performance dots, visible and not visible. PPM believes that data tells the real story and hence tries to develop hypothesis from data and not from experience.

People performance is determined by many factors - internal to the employee, internal to the organisation and external to organization. Data analysis should consider “what we don't see" in addition to "what we see" and must be based on data patterns and data visualization.

This root cause will vary from geography to geography and from time to time. Hence, performance modelling must be” local, dynamic and real time.”

PPM should lead to effective performance reviews by supervisors. It should also result in insights and if required, policy changes in the following areas:

• Hiring parameters.
• Incentive policies
• Induction training and up skilling programs
• People deployment – aligning the pairs (Executive and the supervisor) that will give the best business outcomes. 
• “Just in time“ learning solutions for continuous performance enhancement.

The key questions to ask are:

• How do we predict employee performance?
• How do we know when an employee requires upskilling?
• When do we ask an employee to leave for non-performance?
• How do we measure and predict the performance of a boss?
• How do we predict the exit of a performing employee and hence prevent attrition?
• How do we create cohorts for performance enhancement programs?
• How do we improve hiring practices?

HR managers in various enterprises have developed a lot of analytics and measurements like productivity, cost, attrition etc. While many decisions are made based on analytics, it is typically done at an aggregate level.

The insights discovered at a micro level can be counter-intuitive and can completely change the way we measure and manage people. The micro world behaves in a very different way from the macro world.

As an example, Mr. Muralidharan provided insights about attrition. Data Analytics revealed that in one organization, unauthorized absence for more than three consecutive days was strongly correlated with employee attrition. With this insight, corrective action could be taken and attrition came down significantly.

Three myths about people performance

Myth #1:

• Skilling automatically leads to performance.
• Reality: Only customized role and task level training does. Generic skilling does not. Example – selling skills vs training on critical sub tasks of the role.

Myth # 2:

• Experts and bosses know the performance insights best.
• Reality: Only performing peers know.

Myth # 3:

• It is the line manager’s job to extract performance.
• Reality: Joint responsibility. HR must design and model performance and the line manager must execute it.

Concluding remarks

Making People Performance Decisions based on yesterday’s hypotheses is an outdated practice. People decisions must be made in the future based on real time data and performance modelling. Corrective action should be taken, based on root-causes of non- performance.

Q&A

On his own entrepreneurial journey

In 1991, Mr Muralidharan began his entrepreneurial journey with his first venture in agriculture, or to be more specific, seeds. The venture failed miserably. The ego, which is common in IIT, and IIM grads was gone. Mr Muralidharan then repositioned his business and moved to the HR domain. He was one of the first people to look at learning as a science rather than as a practice. Over the years, the HR practice of TMI has become large and widely respected.

Two things have driven Mr Muralidharan’s entrepreneurial journey. Mr Muralidharan has always tried his best to be relevant in whatever field he operates. He also listens carefully to customers and acts as per their needs.

On the key factors driving employee performance

We have traditionally paid more attention to money and incentives. But performance is far more complicated and driven by various factors. Different people have different needs. Some are driven by a competitive spirit, others by the need to excel and yet others by the need for recognition. Individual design rather than aggregation is the way forward. Schemes to improve productivity should be driven by context, personalization, and customization. We must slice and dice data and analyse it carefully. Our hunch is often wrong. We should use data wherever we can to validate our hypothesis.

Unlocking a person’s potential

Traditionally, a lot of effort has gone into creating an enabling environment by shaping the culture. But in a world of temps and Gig employees, culture may be far less relevant. Culture is relevant to only about 20% of the employees who are full time employees and who work from the office. The performance of the temps and gig workers may be driven more by intrinsic motivation rather than extrinsic motivation. We should embrace the concept of “employee of one” (just like the customer of one in marketing) to look at each employee’s needs differently. While talking about culture, Mr Muralidharan emphasized that the single biggest factor in reinforcing values is leadership behaviour.

On the Balanced Scorecard

This is not relevant for frontline workers. It is more relevant for middle and senior level leaders. The most important lesson from the Balanced Scorecard is that we must focus on leading indicators rather than lagging indicators. The focus should shift to predictive performance. The hypothesis that by improving people and processes, performance will automatically improve, must be empirically tested. We must call out good and bad performance quickly. It is unfair to expect the good performers to carry the burden of the poor performers.

On WFH (Work from Home)

Performance did not suffer when the pandemic broke out and WFH began. But as time has progressed, various challenges have come to the forefront. Managers are more comfortable gauging employee loyalty by what they see in the office, especially the number of hours of work they put in. In a WFH environment, this is not possible. How do we monitor the performance of employees working from home? They could even be doing two jobs! Daily measurement of work is important. Employees will have to publish a daily calendar and also be monitored more closely even if they do not like it.

On the accuracy of performance measurement

Performance measurement is one of the weakest links in HR. We do not know what we are measuring and how we are measuring. Job analysis must be handled more thoughtfully. The task as it is labelled or defined by the role description does not tell the full story. We must look at sub tasks. A few subtasks might account for bulk of the costs or may have a disproportionate impact on performance.

On the future of performance appraisals

The time has come to abolish performance appraisal as we understand them today. Only the 10% of the employees who are promoted or who receive good increments are happy. Performance appraisal today is shrouded in secrecy and measurability has a small role to play.

Moreover, the decision to promote someone should not be based only on performance. When we are thinking of promoting someone, we must look at the person’s ability to handle the new role rather than performance in the current role.

We must shift to using data and shorter cycles and quick rewards. Peer reviews may also need to be used. The concept of annual performance appraisal has become a joke. In any case, many of the employees are not fulltime. So, appraising their performance needs a different approach.

On compensation vs learning

Compensation should not be seen as an entitlement. It should be linked to contribution. If we are paid high salaries by the employer, we will also be expected to deliver more. While changing jobs, we may think we are smart by negotiating high salaries. But we must also ask whether we will be able to hold on to the job in the long run.

Especially at entry levels, we must choose the job which provides the highest levels of learning, not the highest salary. The job should tell us more about ourselves: what we can and cannot do. It should stretch us to the limit.

On careers in HR analytics

People who are good at analytics and data visualization will be in great demand. There is a bright future for people who understand both data science and the HR domain. Today HR depends on people with analytics expertise but who do not have an understanding of the HR domain.

On coping with rejections in interviews

Every rejection tells something about us. Mr Muralidharan recalls his final interview with Hindustan Lever during his IIT days. He was asked a series of questions about his internship. Instead of admitting he did not know the answers, he tried to guess. The senior executive who was leading the interview panel, came down heavily on him. The rejection taught him an important lesson.

Students should move away from the poverty mindset. They should not think that if they do not get this job, they will not get any other job. It is unfortunate to see students panicking during the campus placement season and picking up the wrong job.

We should be more self-aware and develop clarity about where we want to go. We should not worry about rejections. We should look at each interview as a learning experience.

On how head hunters identify the right candidate

Recruiters like TMI have a limited role to play. They shortlist 4-5 candidates. The customer ultimately selects the candidate. For senior level recruitments, TMI has developed a candidate assessment sheet. The candidates are asked various questions with sufficient drill down to validate the claims made by the candidates.

On skill development

We should not look at skilling as something external to us. Engagement is the key to skill development. We must get into a job and start practising what we have learnt. Developing skills needs knowledge, attitude and practice. Ideally, managers should help employees to develop skills. For example, a sales manager should accompany salespeople to the marketplace and demonstrate how to talk to customers and dealers. But today’s bosses are not leading from the front. That is why skill development is proving to be a challenge and attrition is high.

On attitude and character

When the pandemic broke out, many employees realized their vulnerability. But today, while the anxiety about the future remains, the younger employees have also become more selfish. While companies are trying to be helpful and empathetic to employees, they are not reciprocating. Even though companies want some of the employees to return to office, they do not seem to be interested. As mentioned earlier, quite a few of them seem to be doing two jobs simultaneously. That is why investments in employer branding are not yielding the desired results. We may have to wait for a few months to wait for the madness to reduce before making fresh investments in employer branding.

We thank Dr. Vedpuriswar for bringing out the highlights in the form of this note