* 1 in 3 employee feels he is underpaid ( on relative scale - by comparing with others)
* However 1 out of 2 Employee is also over paid ( either due to lateral hire or urgent need , or background of his ex-co than any personal credentials)
* more than 10 companies founded either 2 or 3 decades old still continue to be under same promoters with combined value of promoters in excess of USD 30 Billion ??
* Top 5 are under huge margin pressure due to increased commoditised and competition
* Any further compromise on Margins in Tier 2 can put a huge risk to the sustainablity of business.
These issues on employee base of more than a 8 /10 lacs employees and combined promoters market value of more than 30bUSD
Few radical ideas on
-- Employee cost management and in turn the increased accountablity on
employee ( Value for Competency and Output)
--- Regulation around Promoters stake beyond 10 years from the company start date
Let us look at radical idea on first point above
1. Employee Auction from Common Pool :
* Every co to have fixed Cost of Core /Asset Employees - 15 to 20% of employee base as fixed ( to start with higher % but over period of time reach the above no )
* the balance 70 -80 to come from Common Industry pool to be picked up in auction for a period of 3 to 5 years ( fixed )
* Base Price to be fixed based on Skill sets , Porven track record ( Various measurable indicators ), Market requirement ( relevance of the skill etc )
* Employees have an option of sticking to that base price and continuing in the same company for another period of 3 to 5 years or put themselves in auction ( at employees risk ). However Companies wont have option to say NO post base price finalisation if employee decides to stay. The base Price will be decided as per above mentioned benchamrk across Industry
* If not sold then same employee can revise the base price and be in the market to be picked up other employers.
* conservative employees can fix there base price freezed for 2 auctions - say 6 or 10 years with pre agreed inflation.
The above gives a general idea on this radical ( crazy ) thought...but the key is in detailing - if detailed out it can thrwo up a new model for employment
2.On 2nd point - regulating Founder's /promoters stake post 10 or 15 years
From 10 th to 15th year - promoter should dilute part of stake mandatory to employees/employee trust and part of it towards Market. In Summary no Individual/Group of promoters should hold more than 50% stake in a company after 10 or 15 years - This woudl enable unlocking the huge value sitting at one place and also brings valuation to realistic value for the benefit of market....
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