ABSTRACT Employee Retention is the biggest challenge that Human Resource Management is facing today. The uncertainty of a changing economy, increasing competition and diversity in the workplace has compelled the organizations to hold on to their top performers at whatever cost they have to pay. It is a very difficult task for the recruiters to hire professionals with right skills set all over again. Thus the focus has shifted from numbers’ to ‘quality’ and from ‘recruitment’ to ‘retention. So for his companies The two telecommunication service providers selected for this study are BSNL and VODAFONE.The aim of the research is to provide an insight into the rapidly emerging issue of employee turnover in the telecom sector of India, describing how business intelligence helps in Employee Retention.
Business Intelligence (BI) is a manager in the organizations to manage information and make factual decisions to retain potential employees. Business Intelligence as a process of turning data into information and then into knowledge. This knowledge is utilized in retaining employees and formulates strategies according to it.The study examines the maturity level of Business Intelligence activities as well as the future outlook concerning Business Intelligence in the Telecom Sector. The research will also examine what all factors are supporting in Employee Retention and what all improvements in Business Intelligence operations, benefits gained from Business Intelligence as well as the strength point of Telecom Sector in using BI.
Keywords: Business Intelligence, Maturity Levels, Maturity Models, Employee retention, Employee turnover, Telecom Industry, Customer Retention Factors. ACKNOWLEDGEMENTNothing concrete and desired can be achieved without an optimal combination of inspiration and perspirations. It has been a great challenge but a plenty of learning and opportunity to gain huge knowledge on the way of preparing this management thesis. I would like to take an opportunity to thank those whose valuable suggestions and support resulted in the completion of this research Endeavour. First of all I would like to express our gratitude to Dr. Harsh Vardhan Samalia, whose time to time involvement, guidance and support helped us in completing this project.
He has taken pain to go through the project and make necessary correction as and when needed. I would also thank my Institution and my faculty members without whom this project would have been a distant reality. I also extend my heartfelt thanks to my family and well wishers. Last but not the least I am very grateful to all those who helped us in one way or the other at every stage of the project.
TABLE OF CONTENTS Title Page No. ABSTARCT…………………………………………………………………………...
. 1 ACKNOWLEDGEMNET……………………………………………………………. LIST OF FIGURES…………………………………………………………………… 5 LIST OF TABLES…………………………………………………………………….. 6 CHAPTER 1INTRODUCTION 1. 1 Introduction to Human Resource Management……………………………….
... 8 1. 2 Employee Retention……………………………………………………………. 9 1.
3 Employee Retention Factors……………………………………………………. 13 1. 4 Employee Retention Strategies…………………………………………………. 16 1. 5 Introduction to Business Intelligence……………………………………………23 1.
5. 1 Business intelligence definitions by various authors……………...
3 1. 5. 2 Business Value of Business Intelligence…………………………26 1. 6 Maturity Model…………………………………………………………………. 28 1.
7 TDWI’s Business Intelligence Maturity Model…………………………………. 30 1. 8 Benefits of Business Intelligence……………………………………………….. 1. 9 Need for Business Intelligence in Telecom Industry…………………………….
38 1. 10 Business Intelligence in Employee Retention……………………………………42 CHAPTER 2LITERATURE REVIEW…………………………... …………………38 CHAPTER 3OBJECTIVE AND METHODOLGY OF STUDY…………………..
42 3. The Study……………………………………………………………………….. 42 3. 2 Objective…………………………………………………………………………42 3.
3Research question………………………………………………………………. 42 3. 4Methodology…………………………………………………………………….. 43 3.
5Limitation of study………………………………………………………………43 CHAPTER 4RESULT AND DISCUSSION ……………………………………... …44 4. 1Analysis of Employee Retention factors in BSNL and VODAFONE…………..
44 4. 2Analysis of BI maturity levels in BSNL and VODAFONE…………………….. 59 CHAPTER 5CONCLUSION ……………………………………………………….. 61 5.
1 Conclusion………………………………………………………………………......
. 61 5. 2 Limitation of study…………………………………………………………………...
62 5. Scope for Future work………………………………………………………………. 62 REFERENCES…………………………………………………………………………63 APPENDIX I……………………………………………………………………………65 APPENDIX II………………………………………………………………………….. 67 List of Figures Figure 1- BI Enviornment………………………………………………………………. 24 Figure 2- Broad concept of the term BI…………………………………………………26 Figure 3- Business Intelligence Stages………………………………………………….
29 Figure 4-Benefits of Business Intelligence…………………………………………….. 35 Figure 5- Business Intelligence maturity Level of BSNL………………………………59 Figure 6- Business Intelligence maturity Level of VODAFONE………………………. 60 List of TablesTable 1- Description and Definition of Retention Factors…………………………….
13 Table 2- The TDWI institute (2005) proposes a six-stage BI maturity model…………. 28 Table 3-Advance Opportunities analysis in BSNL……………………………………... 44 Table 4-Advance Opportunities analysis in VODAFONE……………………………..
. 45 Table 5- Combine Advance Opportunities analysis in BSNL and VODAFONE………45 Table 6- Communication Analysis among BSNL employees…………………………. 46 Table 7- Communication Analysis among VODAFONE employees…………………. 47 Table 8- Combine communication Analysis among BSNL and VODAFONE employees……………………………………………………………………………….
8 Table 9- Rewards and Recognition Analysis in BSNL…………………………………48 Table 10- Rewards and Recognition Analysis in VODAFONE……………………….. 48 Table 11- Combine Rewards and Recognition Analysis in BSNL and VODAFONE…49 Table 12 – Analysis of Location In BSNL……………………………………………...
49 Table 13- Analysis of Location in VODAFONE……………………………………..... 50 Table 14- Combine analysis og Location in BSNL and VODAFONE…………………50 Table 15- Compensation Analysis of Location in BSNL……………………………….
51 Table 16- Compensation analysis in VODAFONE…………………………………….. 51 Table 17-Combine Compensation analysis in BSNL and VODAFONE………………. 2 Table 18– Nonwork Influence Analysis in BSNL…………………………………..
…. 52 Table 19– Nonwork Influence Analysis in VODAFONE……………………………....
53 Table 20- Combine Nonwork Influence analysis in BSNL and VODAFONE…………53 Table 21-Job Description Analysis in BSNL……………………………………………54 Table 22- Job Description Analysis in VODAFONE…………………………………... 54 Table 23- Combine Job Description Analysis in BSNL and VODAFONE……………. 55 Table 24- Training and Development Analysis in BSNL………………………………55 Table 25- Training and Development Analysis in VODAFONE………………………56 Table 26- Combine Training and Development Analysis in BSNL and VODAFONE..
6 Table 27- Measurement Analysis in BSNL……………………………………………. 57 Table 28- Measurement Analysis in VODAFONE……………………………………. 57 Table 29-Combine Measurement Analysis in BSNL and VODAFONE………………. 58 CHAPTER-1 INTRODUCTION 1.
1 Introduction Human Resource Management Human resource management (HRM) is the strategic and coherent approach to the of management an organization's most valued assets - the people working there who individually and collectively contribute to the achievement of the objectives of the business.The terms "human resource management" and "human resources" (HR) have largely replaced the term "personnel management" as a description of the processes involved in managing people in organizations. Human Resource management is evolving rapidly. Human resource management is both an academic theory and a business practice that addresses the theoretical and practical techniques of managing a workforce. Organizations are made of people and function through the people. It is through the combined efforts of people that material and monetary resources are effectively utilized for the attainment of common objectives.
Without human efforts no organization can achieve its goals. All activities of an organization are initiated and completed by its co-workers who make up an organization. Therefore, people are the most significant resource of an organization. This resource is called the ‘human resource’ and it is the most important factor of production. These are the ‘human factors’ which refer to ‘a whole of inter-related, interdependent and interacting physiological, psychological, sociological and ethical components’ (Jucius, 1973).
The competitive business environment of 21st century reflects the factors such as aging and changing workforce in a high technology workplace that demands and rewards the ever increasing skill and increased global competition in almost every sector of the economy. Thus human resources represent a quantitative and qualitative measurement of the workforce required in an organisation. Thus the effective management of these human factors is required for the success of an organisation. Human Resources Management is the management of such human factors in an organization.According to Milkovich and Boudreau (1997), Human Resource management is ‘a series of integrated decisions that form employment relationship; their quality contributes to the ability of the organizations and the employees to achieve their objective. ’ Flippo (1984) defines human resource management as ‘the planning, organizing, directing and controlling of the procurement, development, compensation, integration, maintenance and separation of human resources to the end that individual, Employee Retention is the biggest challenge that Human Resource Management is facing today.
The uncertainty of a changing economy, increasing competition and diversity in the workplace has compelled the organizations to hold on to their top performers at whatever cost they have to pay. It is a very difficult task for the recruiters to hire professionals with right skills set all over again. Thus the focus has shifted from ‘numbers’ to ‘quality’ and from ‘recruitment’ to ‘retention. ’ Many organizational human resource management practices play dominant role in building employee commitment and loyalty. Organizational and social objectives are accomplished.
Thus HRM refers to a set of programmes, functions and activities designed and carried out in order to maximize both employee as well as organizational objectives. In response, new organization forms such as virtual corporations, virtual workplace and the modular corporation are appearing. The new forms imply are distribution of power, greater participation by workers and more teamwork. Firms are restructuring, reengineering and implementing quality improvement programmes and building flexibility into work schedules in order to support their competitive strategies.The challenge of attracting, retaining and motivating people has never been greater. Thus human resource management becomes all the more important in today’s changing and challenging environment.
1. 2 EMPLOYEE RETENTION Employee retention is most critical issue facing corporate leaders as a result of the shortage of skilled labor, economic growth and employee turnover. Retention is defined as “the ability to hold onto those employees you want to keep, for longer than your competitors” (Jhonson 2000).The analysis of retention should be considered at more then just a single level because the “influences” of retention can arises at multiple levels(Klein et al.
, 1994; Klein and Kozlowski, 2000; Raudenbush and Bryk, 2002; Yammarino and Dansereau, 2004). A number of studies have found that managing turnover is a challenge for organizations as different approaches to retain employees (American Management Association 2001). Retention is considered as all-around module f n organization’s human resource strategies.It commences with the recruiting of right people and continues with practicing programs to keep them engaged and committed to the organization (Freyermuth 2004). The biggest challenge facing human resource management today is Employee Retention.
A company’s employees have always been a key asset— but today, more and more companies are realizing that their people are by far their most important assets. The reason being that in a world where technologies, processes and products are quickly duplicated by the competitors, and the ace of change and level of competition are constantly increasing, people are the key to the most reliable sources of advantage—better service, increased responsiveness, stronger customer relationships, and the creativity and innovation that keep a company one step ahead. Today the demands of workers have been increased very much as ever before. It is in terms of every aspect, not only salaries and perks but also work experience and cultural context in which it occurs. Providing a prolific, flexible and dynamic work environment can be a critical asset in attracting and retaining valuable employees.
In order to develop an effective retention plan for today’s employment market, it is vital to realize the varying needs and expectation. If the retention strategies are not properly embedded in the business processes, the all effort since recruitment will ultimately proves futile (Earle, 2003). The workplace today witnesses the coexistence of employees from various socio cultural backgrounds i. e.
race, gender, colour, national origin, economic status, ethnicity etc; with his/her own sets of needs, drives and experience; making the corporate culture a complex and diverse one.The progressive companies of the day look for diverse work force who can bring and help in managing diverse talents, interests, ideologies and viewpoints even in a continuously changing business environment. This change in the nature of the workplace has brought up more-not-fewer retention issues. The uncertainty of a changing economy, increasing competition and the diversity in workplace has compelled the organisations to hold on to their top performers, whatever the cost as it is very difficult for the recruiters to hire professionals with right skill set all over again.
Thus the focus has shifted from ‘numbers’ to ‘quality’ and from ‘recruitment’ to ‘retention. ’ When employees with knowledge leave a company, the consequences for the company go far beyond the substantial costs of recruiting and integrating replacements and there is a significant economic impact when an organisation loses any of its critical employees, especially given the knowledge that is lost with the employees’ departure. Also, when a business loses employees, it loses skills, experience and ‘corporate memory. Another reason for the organizations to try to retain their employees and curb employee turnover is the costs attached with it.
Fitz-enz (1997) stated that the average company loses approximately $1 million with every 10 managerial and professional employees who leave the organization. The combined direct and indirect costs associated with one employee leaving an organization ranges from a minimum of one year. Employee retention is a process in which the employees are encouraged to remain with the organization for the maximum period of time or until the completion of the project.Employee retention is beneficial for the organization as well as the employee. Employees today are different. They are not the ones who don’t have good opportunities in hand.
As soon as they feel dissatisfied with the current employer or the job, they switch over to the next job. It is the responsibility of the employer to retain their best employees. If they don’t, they would be left with no good employees. A good employer should know how to attract and retain its employees. Most employees feel that they are worth more than they are actually paid.
There is a natural disparity between what people think they should be paid and what organizations spend in compensation. When the difference becomes too great and another opportunity occurs, turnover can result. Pay is defined as the wages, salary, or compensation given to an employee in exchange for services the employee performs for the organization. Pay is more than "dollars and cents;" it also acknowledges the worth and value of the human contribution.
What people are paid has been shown to have a clear, reliable impact on turnover in numerous studies. Employees comprise the most vital assets of the company.In a work place where employees are not able to use their full potential and not heard and valued, they are likely to leave because of stress and frustration. In a transparent environment while employees get a sense of achievement and belongingness from a healthy work environment, the company is benefited with a stronger, reliable work-force harboring bright new ideas for its growth. Employee turnover is one of the largest though widely unknown costs an organization faces. While companies routinely keep track of various costs such as supplies and payroll, few take into consideration how much employee urnover will cost them: Ernst ; Young estimates it costs approximately $120,000 to replace 10 professionals.
Employee turnover costs companies 30 to 50% of the annual salary of entry-level employees, 150% of middle-level employees, and up to 400% for upper level, specialized employees. Now that so much is being done by organizations to retain its employees, why is retention so important? Is it just to reduce the turnover costs? Well, the answer is a definite no. It’s not only the cost incurred by a company that emphasizes the need of retaining employees but also the need to retain talented employees from getting poached. . 3 Employee Retention Factors Retention Factor| Definition| Advancement Opportunities| The Amount of potential for movement to higher levels within organization| Constituent Attachments| The degree of attachment to individuals associated with the organization such as superiors, coworkers, or customers. | Extrinsic Rewards| The amount of pay benefits, or equivalents distributed in return of service.
| Flexible Work Arrangements| The nature of the work schedule or hours. | Investments| Perceptions about the length of service to the organization. Job Satisfaction| The degree to which individuals like their jobs| Lack of Alternatives| Beliefs about he unavailability of jobs outside the organization| Location| The proximity of the workplace relative to one’s home. | Nonwork Influences| The existence of responsibilities and commitments outside the organization. | Organizational Commitment| The degree to which identify with and are involved in organization| Organizational Justice| Perceptions about the fairness of reward allocations, policies, procedures and interpersonal treatment.
Organizational Prestige| The degree to which the organization is perceived to be reputed and well regarded. | Table 1: Description and Definition of Retention Factors Source: John P. Hausknecht, Julianne Rodda, and Michael J. Howard * Lack Of Job Alternatives One of the earliest models of turnover is March and Simon's (1958) theory of organizational equilibrium, in which the authors proposed that desirability and ease of movement are the two main drivers of employee turnover.
Desirability of movement is commonly defined by the individual's satisfaction with the job, whereas ease of movement generally reflects perceived or actual job alternatives in the external market. Viewed from the perspective of retention, the model suggests that employees will be more likely to stay when they are satisfied with their jobs and believe that there are few alternatives. Hence, job satisfaction and lack of alternatives are included here as two important factors in employees' decisions to stay (see Table I).Many of the subsequent theories of turnover have built on the satisfaction/alternatives framework outlined by March and Simon. Porter and Steers (1973) introduced one of the first major updates to the March and Simon model and asserted that several work- related and personal factors were important precursors of turnover.
From the standpoint of explaining why employees stay, five dimensions from their model are relevant to this study and therefore are included in Table I. Two of these dimensions, * Extrinsic rewards (e. g. , pay, benefits) * Advancement opportunities * Constituent Attachments Investments * Nonwork Influences They should be related to staying because employees are sensitive to receiving fair re- wards for their efforts and may leave when opportunities to receive greater rewards exist elsewhere.
A third factor, constituent attachments, in the form of effective supervision and positive peer group relations, also should be related to retention. Porter and Steers reviewed evidence from previous research showing higher turnover among employees when supervisors had treated them poorly, were inconsiderate, or did not meet their needs regarding feedback and recognition.In addition, coworkers may influence retention because they can provide support and encouragement to employees to help them adjust to the work environment, thereby facilitating attachment to the organization. Investments- Porter and Steers suggested that employees are more likely to stay as they build longer tenure with the organization (because of seniority-related perks or other valued outcomes), a notion that we label here as investments.
Finally, nonwork influences, such as family responsibilities, were mentioned as another factor that may be related to employee retention.This has since been expanded to include a variety of ties to one's community, family, and other life activities outside work. Nonwork influences, such as family responsibilities, were mentioned as another factor that may be related to employee retention. This has since been expanded to include a variety of ties to one's community, family, and other life activities outside work (Mitchell, Holtom, Lee, Sablyn- ski, & Erez, 2001).
* Job Satisfaction * Organizational Commitment Mobley and colleagues offered a revised framework that specified many of the factors discussed above (e. g. pay, promotion, super- vision), but also included several new dimensions that could influence retention (Mobley et al. , 1979). In terms of work attitudes, job satisfaction was viewed as the primary determinant of intentions to quit in their model and the authors were also among the first to discuss the role of organizational commitment in turnover decisions, which was defined in earlier work as an “individual’s identification and involvement in a particular organization”.
Commited employees are expected to remain because they believe in the goals and values of the organization and are on behalf willing to exert effort on its behalf.Organizational Commitment along with job satisfaction has represented one of the most widely studied antecedents of turnover. * Organizational Justice More recently, organizational justice has been defined more broadly to include fairness perceptions related to outcomes, procedures, and interpersonal interactions, which have been shown to be related to employees' decisions to remain with their employer. * Flexible Work Arrangements Number of organizations has offered employees flexible work arrangements to accommodate employee preferences regarding when they perform their work.These programs typically involve alternative work hours or compressed scheduling or both and are often established to reduce tensions between competing work and nonwork demands * Organization Prestige This factor is similar to definition of company reputation and also reflects the more recent talented employees by becoming an “employer of choice” , which often involves commuting and emphasizing the positive features of working for a particular organization to current and potential employees.
* LocationThe location of the workplace has been investigated in relation to withdrawal behaviors such as absenteeism, although few studies have empirically examined location effects on turnover. Researches reveal positive associations between distance to work and absence, perhaps because longer commute times are a source of stress and limit the ability of employees to attend to nonwork responsibilities. In the context of retention, living close to work can be viewed as an influence that promotes job embeddedness or perhaps commitment to remain on the job 1. 4 Employee Retention StrategiesAs the economy improves and firms look to build their talent strength.
It is only logical that senior leaders, mangers and HR professionals will increasingly look at retention as a major business imperative. Rather, a broad set of carefully planned criteria is essential when building a strong retention program. The solutions addressed in the following section were recognized and created by industry professionals whose experience proves invaluable to any company, of any size. They have helped organizations realize their productivity goals through the retention of top performers and the reduction of recruiting.
They have helped organizations realize their productivity goals through retention Strategies: 1. Top Performer Profiling 2. Orientation and On Boarding 3. Performance Reviews 4. Career Pathing and the Two way Value Proposition 5. Communication 6.
Morale Boosting 7. Competitive Compensation 8. Non-Monetary Reward and Recognition 9. Employee Surveys 10. Exit Interviews 1.
Top Performer Profiling- Begin at the recruitment stage by comparing candidates to your best employees. “Knowing how to select the right people, and in fact, actually selecting them is essential to successful performance. - Bill Pollock, “People Are Everything” It is important that both the organization and the employee know what they want to get out of the job. Yet, unknown to most managers, retaining good staff ideally begins during the recruitment phase. A key challenge during recruitment is differentiating candidates whe critical “fitting in” phase of ho do well in interviews and candidates who will do well in the actual position. Often they can be mutually exclusive.
The goal for any recruitment strategy should be to attract a top performer who will stay with the company for as long as possible.In order to hire those “near perfect” individuals, an ideal role profile should be created. If a company spends quality time, energy and focus to create such a profile it becomes much easier to source qualified candidates who will successfully fill the position. A candidate profile should be built around existing top performer’s skills, knowledge and behavior.
2. Orientation and On Boarding- Well defined, post hiring “fitting-In” plans instills long term employee confidence in the organization. To retain the most desirable workers, employers must first recruit them.As mentioned above, the actual hiring techniques in an important step in the process of building relationships that encourage long-term employment relationships.
Orientation is the training process. New hires are oriented to the workplace culture, trained in the role and learn the company’s expected outcomes. The orientation process must provide a clear understanding of the role and the performance targets from the outset, the employee will not be faced with surprise expectations, instilling both confidence and reliability.Many employers have experienced the frustration of hiring seemingly ideal candidates for specific positions only to have them leave immediately after the orientation session. In most cases, this introduction to the company was neither positive nor reassuring enough for the new employee and they left due to overwhelming bewilderment or fear. So, to gain productivity and the highest productivity and the greatest longevity, wise employers should engage, In-depth on boarding process.
3. Performance Reviews-Positive feedback on a regular basis does more to propel success in an individual than any other performance related tactic. Performance reviews are a chance to formally communicate an employee’s contribution to the company. A properly conducted performance review provides the employee and their manager an opportunity to step back, look at the bigger picture of the employee’s performance and to discuss in broad strokes whether the performance is below, at or above company expectations. Performance Reviews increase the chance of an underperforming employee improving their performance. .
Career Pathing and the Two-Way Value Proposition- Paralleling Company goals with personal goals and planning for success in the future creates motivation to outperform in current positions. Essentially, this two way value proposition is the marrying of company goals with personal goals. A strong career plan will provide a sense of hope in the future and comfort in the fact that their company is concerned in them as an individual. The key to this plan is to marry the company’s goals with personal goals, in essense, the real nuts and bolts of employee engagement.
It is like envisioning a journey, the two are taking together. The result is an employee with aspirations who will see that their current role should be performed to the best of their abilities in order that they may continue to the next position. The credibility this establishes with the employee will do more to solidify the intention to stay more than any gift or bonus. 5. Communication and Employee Engagement- Listening commands respect and representation. Nurturing staff should be ongoing a day to day activity.
Clear and open communication is the best foundation for nurturing staff.Nothing says respect or models empowerment more than managers who actively listen to their employee’s feelings. Input and concerns which can be the cost effective way to acknowledge people. Being heard builds self-esteem and employees with high self esteem feel trusted and valued and are likely to feel marginalized. People work for people not companies and people need to communicate effectively to ensure that their voices are being heard and their concerns addressed.
More companies are devising communication plans to keep employees apprised of company performance and business objectives.Keeping employees “in the loop” increases their feelings of inclusion and helps them realize their importance to the company and it’s strategies and fosters the open communication environment successful companies have well ingrained within their culture. Technology plays a critical role in communicating corporate messages to the ranks. For instance, through the internet, employees can learn about employment benefits, job openings and the latest product initiatives.
They can also get a first look at annual stockholder presentations via online video presentations given by COOs and CEOs. . Morale- Respect, value and appreciate employee’s does more than financial compensation to increase retention. Whether employees are heading for the exits at an alarming rate or because employee relations issues are becoming increasingly problematic, the issue of morale is critical to operational success and should be the cornerstone for any retention strategy. Morale directly affects the bottom line through its impact on productivity, customer service (and therefore customer loyalty), turnover, absenteeism and litigation.
Companies must be committed to investing in morale boosting initiatives to reflect both their sincerity towards the issue and their serious approach to retaining staff. Goodies, gimmicks, and gala events on their own, don’t lead to high morale. Nor do any other quick-fix solutions. In fact, when such events and programs contradict workers’ daily experience of not being respected, valued or appreciated, these approaches often lead to an increase in cynicism, distrust and eventual turnover. What does lead to high morale is an intrinsically rewarding work experience where: ? Employees feel respected, valued, and appreciated Employees get to be players and not just hired hands ? Employees get to make a difference With such a work experience, employees don’t need to be ‘bribed’.
They don’t have to be plied with treats to make them want to come to work and do their best. Morale problems are experiential problems; they’re a result of a negative or dissatisfying work experience due to the actual job itself, one’s relationship with their boss, not having adequate training or a myriad of other factors that affect morale. Since morale problems are due to an unsatisfying work experience, the answer is in changing the work experience.More specifically, the answer is in creating a work experience that itself is rewarding (not always fun, but rewarding). 7.
Competitive Compensation, Benefits and Incentive Program Third party survey allows you to stay current and your employees to stay with the company. Competitive compensation and benefit packages including salary, bonuses, stock options, and the traditional health insurance and retirement packages are tools that some companies use to help keep employees onboard. Salary increases should be structured to stay competitive within your market sector, geography and the position.Employers should distinguish between top and bottom performers by ensuring that that those individuals performing in the top quartile are paid over and above those in the bottom quartile. You may consider using 3rd party salary surveys, such as Drake’s Annual North American Salary Survey, to benchmark your workforce’s salaries in your market sector and geography.
Due to the difference in cost of living in various geographic sectors, you will want to understand how to apply salary inflators and deflators in your company to ensure salary equities amongst your employee base.Carefully developed bonus or profit sharing programs provide encouraging, goal-oriented initiatives for employees to aim towards. The goals for success set out by the manager and the employee are more attainable if realistic and practical incentives are firmly in place. Benefit programs are important to employees. Benefits can extend beyond the traditional health insurance and retirement programs and Can include: ? Employees feel respected, valued, and appreciated ? Employees get to be players and not just hired hands ? Employees get to make a difference 8.
Non-Monetary Reward Recognition Creative non-monetary reward and recognition programs can be powerful tools. Increasingly, companies are using informal methods for rewarding staff while financial compensation is becoming less the norm for recognizing employee accomplishments. Reward systems that are person-based are proving to be effective especially when recognition is linked to personal desires or needs such as: ? Time Off ? Flexible work hours ? Job-sharing ? Office Space ? Home Office ? Special Projects, Committee Involvement ? Public Acknowledgment ? Career development and training Company organized discounts such as fitness memberships, discounts on company products / services, discounts on client’s products / services ? Community and Charity Involvement One of Fortune’s 2001 “100 Best Companies to Work for in America” companies has established the “Head start for the Holidays” program which matches up company employees with hundreds of needy children over the holidays. The most important part of any informal reward and recognition system is that it is linked to organizational values and that it is given personally from management.
9. Employee SurveysImplementing regular employee surveys allow employers to take the temperature of employees and gauge a company’s culture and mood. The results will allow organizational leaders to anticipate issues in advance of turnover. Collecting survey data and understanding concerns is only the first step.
Managers need to craft and implement policies that meet employee concerns head-on. Organize company-wide communication sessions that feed back survey responses and associated actions, this lets employees know they are being heard and that their issues are being addressed.Employee surveys are best delivered by a third party consultative company such as Drake which can deliver an objective evaluation and encourage candid responses. 10.
Exit Interviews “Facts do not cease to exist because they are ignored. ” Aldous Huxley It is unrealistic to think that good people can be trapped. So, when people do leave it is important to know why and adjust hiring profiles, policies and practices within the company to address the concerns. A structured exit interview program can play an integral role in employee retention.
Remember it is important to learn from the information gleaned in these interviews. By not paying attention to the results turnover will continue for the same reasons 1. 5 INTRODUCTION TO BUSINESS INTELLIGENCE 1. 5.
1 Business intelligence definitions by various Authors: The term Business Intelligence (BI) was first used as a common name for describing “concepts and methodologies for improvement of business decisions using facts and information from supporting systems” in 1989 by Howard Dresner (Power 2007). Business Intelligence is the capability of the organization or company to explain, plan, predict, solve problems, think in an abstract way, understand, invent, and learn in order to increase organizational knowledge, provide information to the decision process, enable effective actions, and support establishing and achieving business goals” (Wells 2008) BI is a general term for applications, platforms, tools, and technologies that support the process of exploring business data, data relationships, and trends.BI provides an executive with timely and accurate information to better understand his or her business and to make more informed, real-time business decisions (Raisinghani, 2004). BI is a set of business information and business analyses within the context of key business processes that lead to decisions and actions. In particular, BI means leveraging information assets within key business processes to achieve improved business performance (Williams ; Williams, 2007) “BI is the conscious, methodical transformation of data from any and all data sources into new forms to provide information that is business-driven and results-oriented.It will often encompass a mixture of tools, databases, and vendors in order to deliver an infrastructure that not only will deliver the initial solution, but also will incorporate the ability to change with the business and current marketplace.
” ( Ranjan (2008)) BI comprises of a variety of analytical software that provides the information needed by businesses. The emphasis is on the real-time information which supports reporting on every organizational level. The term is much broader in the sense of encompassing multiple tools and methodologies, which enable their users to connect all business processes.Efficient Business Intelligence connects business and IT (information technology) so that the available resources can be allocated with respect to their own capabilities, as well as provides intelligent problem solutions (Ranjan, 2008).
As depicted by Figure , Business Intelligence integrates many of the business processes (enterprise resource planning, supply chain management, customer relationship management…) into a variety of applications that serve the primary source of data, which can be extracted and with the help of BI tools, such as reporting, OLAP, data mining, etc. turned into valuable information (analytics) that the companies base their decisions upon. CRM Analytics Financial Analytics Operational Analytics Security Metadata Management Reporting OLAP Data mining Query Data Warehouse ETL and data integration External Custom Apps CRM SCM ERP Servers Storage Figure 1- BI Enviornment Source- (Ivana Kursan,Mirela Mihic, Management, Vol. 15, 2010) The BI environment encompasses all of the development, information processing, and support activities required to deliver reliable and highly relevant business information and business analytical capabilities to the business.
Within their BI environments, organizations look for designing and implementing successful BIS. These can be defined as information systems providing quality information for analytical decision-making as a source for guiding the business towards achieving organizational goals. BIS analyze business operations and produce information to help business users understand, improve and optimize business operations. BIS, although sometimes used as synonyms for decision support systems, represent a technologically broader concept, including knowledge management, data mining, etc.BI solutions consist of query and reporting, OLAP, statistical analysis, forecasting and data mining tools. Architecturally, we can divide BIS into two parts: a) data warehousing and b) access to data, data analysis, reporting and delivery.
The main difference between traditional information support (e. g. decision support systems, executive information systems, etc. ) and BIS is that traditional information support is more application oriented.
Technologies used in BIS (e. g. dashboards, graphical interfaces, KPI, drilldown, filtering, etc. have been previously used in executive information systems; however, organizational data was scattered around different data sources often connected to a single decision support solution. The key problem was providing a uniform and integral view on the data. Data warehousing and the later broader concept of BIS try to solve this problem with a data-oriented approach where the centre of the architecture represents integral data sources for analytical decision-taking.
A state-of-the-art BIS thus includes infrastructure (data warehouse) and analytical tools.Understanding of BI also differs on its content’s focus as well as on several related terms used for referring to BI (including competitive intelligence, competitor intelligence, strategic intelligence, etc. ). Figure . shows what areas the term BI relates to: Business Environment Customers Internal Strategy Employees Business Processes Finance Suppliers Figure-2 . Broad concept of the term BI (Ales Popovic, Management, Vol.
15, 2010, 1, pp. 5-30) 1. 5. 2 Business value of business intelligenceA major agenda of both practitioners and researchers within the area of IT management is the determination of added value through investment in new technology. This critical link has not been consistently established due to a variety of methodological approaches, the existence of intervening variables, inconsistent measurement of productivity, and the treatment of IT investment as a ‘lump sum’. Most of IT investment in the past decade has been in what amounts to better systems for managing day-to-day operations, and more frequent and voluminous reports .
There is little debate that these investments are necessary to operate many modern enterprises, but findings from scientific and professional researchers suggest that these organizations are still data-rich but information-poor This means that these organizations lack the kind of actionable information and analytical tools needed to improve profits and performance. Applying BI takes resources, and the benefits actually occurring in practice are not always clear . Thus, two important questions organizations face now a days are: why measure BI, and how. BI measurements serve two main purposes.The first and most common reason for measuring BI is to prove that it is worth the investment.
IT investments deliver greater value when the responsibility for business value capture resides on the business side. The second main purpose for the measurement of BI activities is to help manage the BI process: that is, to ensure that the BI products satisfy the users' needs and that the process is efficient. Current measurement approaches for determining the value of BIS and measures for managing the BI process are summarized by Lonnqvist & Pirttimaki.Currently, measuring in practice is not being done as either no suitable measurement methods have been identified or the companies having no resources for such activity. With the help of appropriate measurement methods, BI activities could be more easily proved beneficial and valuable; for instance, to a management board not yet committed to the operations. We can ascertain that for BIS it is relatively simple to determine the costs and harder to define the benefits .
The latter usually cannot be directly measured on the market. Benefits deriving from BIS are hard to define in terms of greater productivity, which is a general presumption with investments in IT. When many executives, managers, and knowledge workers think of IT in general, they have a strictly utilitarian view of IT. As a result of this orientation and because of the magnitude and importance of the BI investment, it is important for business leaders and managers to expand their understanding of the nature of BI initiatives .
There are several researches and frameworks in the area of justifying investments in data warehouses, which represent an important technological element of BIS. Related to its business value of business intelligence, we can view the development path of BIS within organizations through different BIS maturity stages. These are commonly presented with models. A maturity model assumes progress comes in stages, ultimately reaching an end goal. BIS maturity model illustrates how BIS evolve from low-value, cost-centre operations to high-value, strategic utilities that drive market share.In the current business environment, there is no scarcity of BIS (and BI) maturity models .
They provide organizations an ‘instant perspective’ on the status and the perspectives of their BIS initiative. For example, the TDWI institute (2005) proposes a six-stage BI maturity model STAGE | ARCHITECTURE| ANALYTICS| | 1 Parental| Reporting| Paper Report| INSIGHT| 2 Infant| Spread marts| Briefing Book| | 3. Child| Data Marts| Interactive Report| | 4 Teenager| Data Warehousing| Dashboard| ACTION| 5 Adult| Enterprise DW| Cascading Scorecards| | Sage| Analytical Services| Embedded BI| | TABLE-2- The TDWI institute (2005) proposes a six-stage BI maturity model Source-Ales Popovic, Management, Vol. 15, 2010, 1, pp. 5-30) In the proposed model, maturity is defined through the system’s architecture, attainment of the system, its users, and through the focus of the system.
1. 6 Maturity Model Maturity models are used to describe, explain and evaluate growth life cycles. The basic concept of all models is based on the fact that things change over time and that most of these changes can be predicted and regulated.Models for different domains evolve gradually, that these same models are improved and changed over time and that authors often build and improve their models based on the past experience of other authors.
The maturity model consists of a model and questionnaire, which is used to assess the level of maturity of the development environment Key Process Areas are defined inside each level of maturity, which are typical for that particular level and differ between models depending on the problem domain.Key Process Areas represent phases, which need to be completed by the organization in order to achieve a certain level of maturity. In contrast to the majority of BI maturity models that focus primarily on technological views, source integration, and use of state-of-the-art tools for data integration and their access, propose a maturity model emphasizing a change of ways information is used because of BIS. Figure given below shows a 4-stage model of dependence of the business value from the BI maturity stage. At the early stage (Stage 0), BI maturity is low (no data warehousing and BI tools are used).Due to improved and adaptable reporting, organizations move to the next stage (Stage 1) where greater maturity and business value are present, but there is still no change in the way information is used.
Awareness of the importance of an organization’s information wealth (first building then using) enables organizations to move on to Stage 2 where information usage is optimized at the business level (within one or more business functions). Greater Value Creation Information Fully integrated into business Stage 3- Changed information Usage, paradigms across1 enterprise to leverage BI Business Value CreationBuilding And using Information assets Stage 2- Changed information Usage, paradigms in 1 or more functions to leverage BI Stage 1 No change to information , Usage Paradigms Stage 0 No DW/BI Experience Status Quo Greater Maturity BI Maturity FIGURE-3- Business Intelligence Stages (Ales Popovic, Management, Vol. 15, 2010, 1, pp. 5-30) When organizations are able to fully integrate the use of information into existing business processes, they achieve the last stage (Stage 3). Here, the information usage is optimized at the enterprise level which leads to the highest stage of BI maturity, thus the highest business value.The pace of evolution in BIS (and BI) maturity and the degree of success depends partly on organizations’ ability to learn about, develop, and implement effective BI competencies.
1. 7 TDWI’s Business Intelligence Maturity Model TDWI’s Business Intelligence Maturity Model focuses mainly on the technical aspect for maturity assessment. Maturity is being evaluated through eight key areas: Scope, Sponsorship, Funding, Value, Architecture, Data, Development and Delivery. Each of the eight aspects is graded with the following five grade scale: Infant, Child, Teenager, Adult, and Sage.The main characteristics of the grading levels are : Infant This first level is composed of two phases: Prenatal and Infant. Operational reporting is typical for the prenatal phase.
Spread marts, on the other hand, are typical for the Infant phase. The Prenatal phase lasts until a data warehouse is created. Most companies have an established operational reporting system with a standard set of static reports. Reports are usually built into operational systems and limited to that individual system.
This makes adjustment and fast delivery of customized reports very difficult.Lack of agility forces business users to take actions themselves resulting in partial data sources, typical for the next phase. In the Infant phase, a company is faced with numerous partial data sources called spread marts. Spread marts define as spreadsheets or desktop databases which are used as a replacement for regional data warehouses.
Each of them contains a specific set of data, metrics and rules with a small or no correlation at all between each other, operational reports or analytical systems. Fragmented data sources are producing conflicting views on business information.They undermine the effective decision-making process supported by strategic goals, and prevent a clean and consistent view to all events in the company. Child At this level, knowledge workers join the community of BI users. Information demands are gathered on the department level and cover only the needs of the same department members.
Companies at this level usually buy their first interactive reporting tool, which knowledge workers then use to drill the data. They are also capable of analyzing trends and past data. Importance is focused on understanding correlation in the data and to gain understanding of the past business actions.Regional data warehouses are built on this level. They are not linked to each other.
Definitions and rules are limited to an individual regional data warehouse. Data is usually retrieved directly from the operational systems. This kind of data does not allow interdepartmental consolidation and analysis. Teenager The company recognizes the need and starts to use a standardized set of project and development methodologies, including best practices, learning on past experience and extensive use of external consultants.
BI management is taken over by a group of people from different departments under the lead of the BI program manager.Software solutions for BI are being developed on a common data model using a common platform. The company recognizes the value of consolidating regional DW into a centralized DW. A centralized DW enables the company to perform enterprise-wide analysis, bridging the border of individual departments gaining new knowledge. The company is introducing new BI solutions like dashboards customized for each individual user group.
These dashboards include key performance indicators (KPIs). Use of BI is spread among regular users and enables knowledge workers interactive reporting and analysis. AdultBI develops from a tactical to a strategic business level at this stage and becomes the central IT system driving daily operations of the company. Processes are monitored using dashboards. Key performance indicators and business performance are used to compare the actual state with the strategic goals of the company. The main characteristics of the Adult level are: centralized management of BI data sources, common architecture of the data warehouse, fully loaded with data, flexible and layered, delivery in time, predictive analysis, performance management, and centralized management.The company often builds a special BI team independent from the organizational structure reporting directly to the executive management. Language and metric rules are unified across the company. The BI system includes all the data in the company, not just part of it. A fully loaded data warehouse is therefore dynamic and enables quick adjustments to new business needs. Designers have split the architecture to individual abstract layers preventing changes on one layer to influence other layers. The data warehouse is integrated with its data sources in real time.The company starts using a more accurate and more complex prediction and modeling tools. Sage Companies at this level are turning BI system capabilities into technical and business services and are moving development back to basic organizational units through Centers of Excellence (COE). The main characteristics of this level are: distributed development, data services, and extended enterprise. The most typical usage of the BI system is creation user customized reports, KPIs, and other information services. The central information management group is responsible for management of the enterprise data warehouse as a epository for all enterprise information, while the development of customized solutions is left to distribute groups. For faster development of solutions, service oriented architecture (SOA) is used. Adequately trained and certified developers (both internal and external) can then combine data services and the BI system into new solutions. A number of users is dramatically increased. Business and IT are aligned and cooperative. BI provides services with high added value, bringing high business value and competitive advantage. There are two major obstacles on the path from Infant to Sage: Gulf and Chasm.Gulf Combines challenges and obstacles preventing a company to move from the Infant to the Child level despite building the first data warehouse, which is normally a sign of progress to a higher level of maturity. The problem is in poor planning, poor data quality, enterprise culture, and in the intensity of spread marts usage. Chasm Combines challenges and obstacles preventing a company to move from the Teenager to Adult level. To overcome this obstacle, Enterprise Data Warehouse is usually built. Initiative usually comes from management.The goal is to unite independent regional data warehouses to achieve a more consistent view on distributed business information and reports on all aspects of the company. Many people can quickly tell if the patterns in the model are aligned with their BI program and if the model is a useful tool helping to understand the past, the present and the future. Besides assessment of the BI maturity, the value of the model is also in helping people to realize that their effort is not isolated and that they share challenges and obstacles with other people in the company.BI groups often start their work with enthusiasm, which diminishes quickly when groups are faced with cultural, organizational and technical challenges. 1. 8 BENEFITS OF BUSINESS INTELLIGENCE BI potentially generates a range of benefits. Some of them, like cost savings from consolidating multiple data marts into a centralized warehouse, are relatively easy to calculate. Others, such as the potential returns from supporting the accomplishment of strategic business objectives (e. g. , organizational transformation), are more challenging.Some, like a departmental application, have a local impact, while others, like a company-wide dashboard/scorecard application, are global. Like most organizational expenditures, BI projects usually go through an approval process and later the resulting benefits are assessed. There are exceptions, however, such as projects that are mandated by senior management or are so successful that there isn’t a need to spend time and money going through a post-implementation review. Assessing BI benefits is more challenging than for operational systems because of the ? oft nature of many of the benefits, such as more and better information and the making of better decisions. Normally it is easier to assess the benefits after a BI project is implemented than before. Many consulting firms, vendors, and companies take the following approach to assessing BI benefits. First the organizational pain? is identified. For a telecommunications company, it might be high customer churn. Then the current situation is benchmarked; in our example, the key metric is the annual churn rate. The BI project might be the implementation of customer relationship management software to help reduce churn.An estimate is then made as to how much the BI initiative would reduce the churn rate perhaps two percent. This reduction in churn is then financially simulated, often using an Excel spreadsheet, to estimate the improvement in the firm’s bottom line. This improvement is then compared to the cost of the BI initiative to determine if the investment is justified. Global Impact Difficult to measure Local Impact Easy to measure Cost Savings from data mart consolidation Time savings for data suppliers Time savings for users More and better informationBetter decisions Improvement of business processes Improvement of business processes Support for the accomplishment of strategic objectives Business Intelligence Benefits Figure 4:- Benefits of Business Intelligence (Hugh J. Watson, Volume 25, Article 39, pp. 487-510, November 2009) 1. 9 NEED FOR BUSINESS INTELLIGENCE IN TELECOM INDUSTRY * Employee Productivity: It is imperative they acquire new, profitable employee as well as increase the productivity of existing ones. * Cross Selling: This can be a major source of selling for a telecom company.For effective cross-selling, existing data can be leveraged using business intelligence solutions to quickly zero in on new products that may be required by existing customers. * Employee Attrition: Acquiring new employees are much more costly than retaining existing ones. Employee attrition analysis is an essential step in employee retention. * Job Analysis: Job analysis is used to analysis the effectiveness of a job offered. The effects of a particular job on productivity of the employee which can be tracked using business intelligence solutions. Forecasting: to plan their networks, telecommunications services providers perform forecasting that helps operators to make key investment decisions. * Budgeting: Data warehousing facilitates analysis of budgeted versus actual expenditure for various cost heads like promotion campaigns, product development, infrastructure maintenance, investments, and commissions. etc. 1. 10 BUSINESS INTELLIGENCE IN EMPLOYEE RETENTION Companies around the world face a workforce that is getting older. This will make attracting and retaining talent a top priority as mentioned in my previous blog Business Skills for IT Workers.This trend will catapult into the role of HR department right into the middle of formulating a people centric business strategy, especially in Knowledge Industry. As the global war on talent continues, it will become increasingly difficult for large organizations to hire, motivate and retain talent. With the technological advances and globalization, organizations will be subjected to intense competition. Thus, utilizing the right human capital will be of paramount importance. Intense competition will also lead to growing attrition. This is where HR can play an important role in ‘Talent Management’/Employee Retention.Rather than doing only administrative work and ‘reactive’ hiring/firing employees, the HR professional need to ‘proactively’ start solving people issues. IT executives will not be able to address this on their own. Like it or not, they will have to collaborate with HR department in producing solutions to strategic ‘people’ issues facing the organization. With the advances in Business Intelligence (BI) tools, HR department can utilize all the data related to their existing employees to analyze their human capital and provide decisions around staffing and retention.Business intelligence can also help HR Department to mine out information regarding: * How to motivate individuals and departments within organizations? * Do our incentives and benefits reward smart contribution? * How to flush out innovation from individuals and departments? * Will the individuals work their best in collaborative environment? * What is the best technique to train employees? * How to incorporate feedback from individuals? * Why do employees leave the company? Where do they go? * What does the individual employee think of work environment?Currently HR is not empowered to answer these questions in a systematic way. With the BI tools, the HR can tailor the benefits and incentives to custom fit every employee. The era of providing generic benefits is over. ‘Mass Customization’ of benefits to suite individual employee is where the future is. BI tools will help HR get there. This will be very critical to be competitive in attracting and retaining talent. CHAPTER -2 LITERATURE R
