FMCG Play­ers Go the Startup Way in Re­ward­ing Best Ta­lent

ON OF­FER With the sec­tor do­ing much bet­ter now than in the past few years, FMCG cos are re­ward­ing em­ploy­ees with a wide range of sops to check at­tri­tion at all lev­els

The Economic Times - - Companies -

Ratna Bhushan & Prachi Verma Dad­hwal

New Delhi: Fast-mov­ing consumer goods (FMCG) com­pa­nies have started giv­ing their best em­ploy­ees the kind of ex­tra­or­di­nary in­cen­tives that star­tups have come to be known for af­ter a gap of al­most two years, dur­ing which it seemed only ecom­merce firms were be­ing gen­er­ous in their ef­forts to re­tain ta­lent. Pep­siCo for in­stance is send­ing four young per­form­ers to Cannes on an all­ex­penses paid trip in June, while Proc­ter & Gam­ble has dou­bled the num­ber of em­ploy­ees el­i­gi­ble for global stock op­tions, most of them mid­dle-rung lead­ers.

“The mid-level in con­sumer­fac­ing com­pa­nies, es­pe­cially, had come un­der pres­sure since the ra­tio of rev­enue to re­ward had slipped at a time when star­tups were burn­ing cash for val­u­a­tions and not prof­its,” said search firm Wit­thaus Man­age­ment Con­sult­ing man­ag­ing di­rec­tor Rahul Nene. “But the ex­o­dus to star­tups seems to be on the ma­tu­rity-to-de­cline curve. At the same time, ac­tion for fall­ing short of tar­gets is be­ing re­laxed by FMCG firms.”

Ju­bi­lant Food­Works, fran­chise rights holder for Domino’s Pizza in In­dia, has now started quar­terly spot and chair­man’s awards for em­ploy­ees that in­clude over­seas trips and go be­yond tra­di­tional so­lu­tions such as salary in­cre­ments and in­cen­tives, said Bi­plop Ban­er­jee, ex­ec­u­tive vice-pres­i­dent for hu­man re­sources. The com­pany’s an­nual awards cover 22,000 em­ploy­ees in 30 dif­fer­ent cat­e­gories. It has ex­tended ma­ter­nity leave to 26 weeks from 12 and im­ple­mented con­cepts such as cel­e­bra­tory leave, say for an em­ployee’s own birth­day or that of a fam­ily mem­ber.

Re­cruit­ment agen­cies say consumer-fac­ing firms, which had been los­ing ta­lent in the mid­dle and se­nior lev­els, are ag­gres­sively try­ing to keep peo­ple with the sec­tor do­ing much bet­ter than it was in the past few years.

“Over the last four to five years, the consumer space was not do­ing as well as it is now,” said Su­nit Mehra, man­ag­ing part­ner at Hunt Part­ners. “This year has been bet­ter than pre­vi­ous years and we see this trans­lat­ing into good num­ber of bonuses and even stock op­tions.”

Reckitt Benckiser, maker of Det­tol soap, has started an an­nual bonus pro­gramme for ju­nior-level em­ploy­ees that could see them earn­ing an ex­tra 40% of their salary, said re­gion­alHR di­rec­tor Udayan Dutt. For top man­age­ment, the max­i­mum bonus is now one­and-a-half times their fixed salary.

Nes­tle has dis­carded the bell curve for ap­praisals and has gone in for year-round per­for­mance rat­ings, hand­ing out in­cen­tives based on that. Search firms say the trend stems from a com­bi­na­tion of ecom­merce hir­ing los­ing trac­tion and FMCG firms want­ing to hold on to peo­ple.

At Pep­siCo, the plan to send four ex­ec­u­tives to Cannes is aimed at in­cul­cat­ing in­no­va­tion and en­trepreneur­ship, said Pep­siCo’s VP of hu­man re­sources Su­chi­tra Ra­jen­dra. “We want to en­cour­age younger lead­ers to take on the role of game chang­ers,” she said.

For Nes­tle, which is emerg­ing from a tough year af­ter the ban and re­launch of Maggi noo­dles, recog­ni­tion is be­ing given in daily and weekly re­views across fac­to­ries and branches, in­clud­ing on­line recog­ni­tion plat­forms. Son­ali Roy­chowd­hury, the hu­man re­sources head of P&G In­dia, which makes Ariel de­ter­gent and Olay cream, said: “We have sub­sti­tuted an­nual CEO-nom­i­nated stock award pro­grammes for top per­form­ing younger em­ploy­ees with guar­an­teed cash re­wards in­de­pen­dent of the stock mar­ket.” Salary in­cre­ments are not re­stricted to an­nual cy­cles and can be awarded at in­ter­vals of six to 11 months.

Oth­ers like ap­pli­ances maker Whirlpool has been tak­ing top per­form­ers to places such as Bali and Switzer­land. From this year, fam­i­lies can ac­com­pany them, said Sarthak Ray­chaud­huri, vice pres­i­dent, hu­man re­sources for Asia South. So far, 25 per­form­ers have been re­warded with all­ex­pense-paid over­seas trips.

In the fight with ecom­merce com­pa­nies to hold on to peo­ple be­long­ing to a limited ta­lent pool, many tra­di­tional or­gan­i­sa­tions have gone be­yond typ­i­cal cash bonuses and tax-sav­ing in­cen­tives over the past year, said A Ra­machan­dran, part­ner at head­hunt­ing firm EMA Part­ners. “Cash in­cen­tives have gone up sub­stan­tially with some con­sult­ing or­ga­ni­za­tions of­fer­ing up to 100% of the to­tal com­pen­sa­tion as in­cen­tives on meet­ing stretched tar­gets,” he said.

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