Motivating the support function

I always used to wonder about solving the mystery of motivating a support function (HR, Finance, administration, security etc) of an organization. Though these categories of people are paid a lesser amount of salary when you compare it with the ‘Billable’ resources, they form the most integral part of completing an organization and often act as engines to drive the company forward. But unfortunately not all organizations give importance to them and seldom take pains to motivate them; they are expected to be a set of self-motivated individuals being the reason!

In the due course of demystifying the motivational parameters for the backbone of an organization, I bumped into the Maslow’s hierarchy of needs. For the ones who are new to it, just refer to the diagram below:

But you cannot have a direct mapping with the hierarchy as it is. Hence, I tried changing it to map it with the dimensions which would probably motivate the support function.

The Impact

McKinsey Quarterly early in the morning has become a norm for me now. In one of its latest reports on the public sector - 'The Market State', they have tried to describe the state of the society existing in the market. In the due course of doing the same, a few analysis on the unemployment issues existing across the globe (esp post recession) stuck my thought process.

"While Japan and most European countries don’t share Spain’s punishing 20 percent unemployment rate, they have sacrificed GDP growth to support a robust social-safety net." Well... there are as always two perspectives to this statement.

Looking at the brighter side of the coin, the social welfare is still protected even though the markets have created havoc. The interest of the society is maintained to an extent where people can lead their day-day life without having to bother much about their daily bread. They will have to eventually find a job in the given time span for financial coverage. But with recession hit countries, the span has been stretched after the government has realized the fact of jobs not being available for the locals. Obama tried bringing in a few laws for local employment at US. This did prove to be a success to some extent though there were certain communities apposing it! Even during my days at the UK, I figured out the fact that the government did offer a financial cover to its citizens for a certain period of time so that their daily bread is protected.

But an economists’ counter argument would be ‘Look at it with the magnifying glass of the world! People in the globe are working.’ He is definitely right in his perspective of a boundary less operation. But, with the political scenario existing, it might not be a near possibility. Coming back… With the world getting flatter by the day, it is becoming a very challenging task for countries to create and maintain jobs locally. Hence these measures are proving to be a boon to the society. But by doing this, can the countries sustain for long? Won’t the debt of the countries increase to an extent where it is not returnable? Taking a pessimistic view, to answer these questions, I tried drawing the ‘MR=MC’ curve.



Consider MR (Marginal Return) as a parameter for the income from taxes and other governmental cash inflows and MC (Marginal Cost) as the cash outflows in terms of infrastructure development, Social welfare, R n D etc. Now, if a percentage tolerance to the point MR=MC is provided (point ‘Z’ in the above graph), the countries can probably control the amount of debt which might impair the growth. When the countries have decided to sacrifice the GDP growth due to social issues, the tolerance level just increases and hence the uncertainty of growth.

But whatever be the decision to go ahead with, the complexity in terms of the number of diversified parameters involved in this is huge! Hope that the political heads won’t screw up things by taking undesirable decisions…

Managing without the power of execution

Can you do that?? Do you have enough patience to be sandwiched? Can you deal with the top as well as the bottom layers? Can you be a football for the rest of the players on the field to play? etc etc...

In the quest for beating the rest in the rat race and 'Growing' in the industry, one has to deal with the mid-management layer. As my idle days at office continued, I pondered over the career progression offered by the industry. Well, it makes a lot of sense. Though Elliott Jaques considers this as one of the factors for the occurrence of Midlife crisis, it definitely is something which one has to go through.
Usually in this stage of the career, a person gets into a lot of gray areas which tests his patience. The interactions with BOP seem to be obvious; the interactions with the TOP seem to be ridiculous. Though he might know what has to be done to get things done in the right way, he might not be given powers to implement it (strictly coz of the fact that the data available to the guys at the top is very much different). This raises the frustration level and thus might affect his contribution to the company.

The best way to deal with this problem - 'Think in their shoes. Wear a different shoe when you enter into a different discussion...' and Voila! It works! While the concept of 'Six thinking Hats' deals with the different angles of decision making; it is highly applicable for the day-day situations that a person at the mid-management level undergoes. By doing this, unknowingly, he will be grooming himself up for the growth. Having been at the lower levels more recently than his managers, one should be in a better position to strike a connect with them in order to understand them and sync with their thought process. In the quest of growing up, one should be in a position to strike a chord with the top layer.

The question that people at this level often go through is - 'Do I have to really go through all this in order to earn a few bucks?' Well... yes my dear friend; you have to! That is when you will be broadening your reach, getting to understand the different angles of the human psychology, understanding the bigger picture, polishing yourself etc. These are just a few essential traits to deal with the issues faced by the top management. Either you startup someday or grow in the industry to reach the top; immaterial of the path taken, these traits are highly essential for an individual.

The Finance function...

Another day of idleness at office and I started thinking about the working of a Finance function in an organization. Since I have the liberty of walking down to the highly co-operative Finance team and getting the details from them in a generic perspective it made it a lot easier.

After having seen the Q2 results of various industries over the last month, I was in particular wondering about the amount of impact forex rate fluctuations can have on the balance sheets of an organization which is locally registered (and hence the balance sheet should reflect the local currency). It is a no-brainer to guess the fact that the magnitude of the impact is in direct proportion to the size of the deal. A 10 paisa (INR) can make a difference of 100 million in a $1bn deal! Now, though the amount looks to be huge, an organization should concentrate on the factor - 'Percentage contribution of the revenue'; Saying, what % of the total revenue is this 100M contributing to. For a SME, yes it is a huge %; likewise for a larger enterprise, it might not make a huge difference! The enterprises usually get into a contract with the bank where they agree on a future rate in dealing with the currency conversion. This way the risk of currency fluctuation is mitigated to some extent.

During the conversation, I also was informed about the way bank accounts are created in order to avoid the conversion rates (forex transfer rates). Since the % deduction in the forex transfer depends on the bank, it becomes fairly important to avoid this. A forex account specific to the currency of operation is the answer for this. By making this forex account local to the client site, it only avoids the transfer rate. However, the macro-economic parameters (service tax etc.) are country specific and viewed with a bigger picture. Here, it depends on the kind of work being done. If it is a bodyshopping (the service provider just provides resources and are not responsible for what work is done by him), services taxes are most likely to be applicable depending on the country's corporate laws. If a complete development work is done, there might not be a service tax. But all this highly depends on the country with which the engagement happens.

I also worked out a high level Team structure for an IT industry which has to be in place for smooth operation. The team size and intermediate hierarchies depend on the size of the organization.