Loyalty versus Performance

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There is much dialogue that Indian organisations lean towards wishing both loyalty and performance.

In this article I explore this deeper…

I hold that loyalty is defined as a faithfulness to one’s commitment or obligations. The ‘Corporate speak’ for this is often translated to anecdotes about employees, and include:

·      Employees who are obedient, and serve long tenures (recipient of long service award!)

·      and while he serves works long hours, is diligent, rushes back to organisation in case of an emergency , etc. (even on vacation, etc)

·      prepared to put Company above all else, self and family included.

Some of the corporates I have worked with value this quality deeply. Also, for some employees holding ‘life long employment’ is a source of pride – lifers!. Especially for Gen X folks who continue to espouse the philosophy of a ‘one company’ service. Many elderly folks still talk about a secure job – be it a PSU, or Government Sector. If it is the private sector, than more stable companies like, TISCO, ITC, etc

In a recent interview commenting on lay-offs in the current pandemic, Ratan Tata queries Corporate ethics, “These are the people that have worked for you. These are the people who have served you all their careers. You send them out to live in the rain. Is that your definition of ethics when you treat your labour force that way?”

Is continuity still relevant today?

Is it better for both employer and employees to contract for a shorter period? Will an organisation gain more with employees on a shorter duration? Will an employee gain more if he moves across companies? Do we need to provide ‘job security’ as an employee value proposition? Is this what is core? Are today’s Organization built to last? Do we want ‘form’ to last or ‘purpose’? These are all very relevant questions of the day.

One way of responding to these questions is from design thinking. At the heart of most matters, lies the principle of DESIGN. Design principles enunciates the timeless axiom : Form follows functionality. (ie Purpose). So let’s enquire of ourselves, do we really (both organisations and employees) benefit from long stints with each other today?

From an organisations side, the roles today especially in the service sector, need ‘fresh youthful energetic blood’ and inexpensive resources or do they? The very nature of some role does not provide for tenure over more than 2-4 years. For example, an air hostess or a Customer Service Advisor. Does it really help either to stay beyond the 4 years, in this role? Airlines need fresh blood, employees reach exhaustion / burn-out and beyond these roles, the upward mobility is restricted, (ground staff roles are fewer, and still need youngsters! and there are but a few team leader roles, even as the BPO industry starts to hold steady on costs). With the pyramid essentially flattening, and lack of opportunities the employee becomes a wage island (beyond the max job value – MJV), disengaged (on account of lack of opportunity) and either a hostage within or a strong internal dissident. To support this view, one has to just look at the engagement study data from each company, less than 25 % folks are fully engaged, advocate the organisation. So do we want employees to stay, because they have nowhere to go? Or do we want engaged employees? And even if we have engaged employees, can we really afford them in the system? Have they become to expensive, relative to fresh blood in the market. We know the optimum experience need to be an effective secretary is say, seven to ten years. So what is the business case for a secretary with 23 years of experience? In many organisations, such as consulting, the principle of ‘Up or Out’ is followed. Is there a way to handle these issues, perhaps with a freeze in salary beyond the maximum job pay value?

Several decades ago, many were dependents on the ‘family bread earner’. Emerging out of 200 years of colonial rule, most jobs were clerical – the ‘babus’. Few were in senior roles such as the ICS. Entrepreneurship was discouraged (few had access to licences and permits, and over production was a penalty even in the late 1980s). Supply was less than demand, prices of at premium. Oil companies distributed oil, not sold it! Bereft of competition, organisational designs were clear: establish the pyramid – Control and Command. Guerrilla warfare was not known then. Long tenure, silent subjugation, mentors and mentees and long careers were the recognisable order of the day. Are these forces similar today?

Organisations they say are perfectly designed: they are the way they were created! More so, sustained. We deserve what we have. So do we still need to hang on to this design. Is the environment similar? Absolutely not. Tennyson famously said, “the old order must give way to the new, lest one custom should so corrupt the world”.

I argue, that in today’s era, ‘contribution matters, not just continuity. Contribution is the optimum application of intelligence to an issue when needed, in the correct context. We need contributors, single contributors even without them leading teams, team leaders, who only act as coordinators, not as leaders, and of course we also need leadership. We also need different kinds of talent at different stages. (See: https://www.linkedin.com/pulse/right-talent-timed-relevant-organisation-phase-steve-correa/)

We need to segment the organisation beyond the current segmentation: performers and potential. Rather, we should look at human capital as a sector of people who have common needs. For example, a 26 years old paying EMI on his house and car, is no different to a 46 year old paying college fees in USD for his children – both have cash flow needs. A woman returning after a hiatus of 8-10 years back in employment, no different to a MT – both want to prove themselves. It is when we look at organisations, not with our familiar microscopes but with a new darshana, we see more! Contribution is the new currency – it is what matters most and will always matter. Contribution has wings – it will fly to those who respect it most, who can use it. It is not possible to demand it, handcuff it, embed it – it can only be nurtured. If employees contribute, continuity does not matter. If continuity exists, but contribution is not there, the organisation is moribund. If contribution takes place and employees still continues, it is a Bonus! Today by the time people reach 40, they would change ten jobs, 25% of all jobs, will not have existed today. Already, the younger, are smarter, brighter, and more knowledgeable than they elders. I think it’s time to Wake up, and smell the coffee!

The need is to change our thinking – how do we design organisations around shared purpose and shared values – rather than shared beliefs and common forms. to move from looking similar to feeling similar. We need to re-design the job purpose and role specs to engage with contribution, rather than continuity. Our organisational competencies required today is akin to white water rafting – no time for post mortem or long term plans, navigating the next 20 yards, energy and working with turbulence – which is the new normal. Contribution is about making a difference, that matters.  In both contribution and continuity, loyalty exists! Time we re-defined the notions we hold about Loyalty.

It is said, we only answer to the QUESTIONS we have asked. It is time, we ask a different set of questions. Perhaps we will come up with different answers. With Covid times amidst an even more urgent need to ask a different set of questions.

I am sure you will have important perspectives to share – Please do comment.

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