In Conversation With Amit Sharma, CHRO, Volvo Group India on Reshaping Jobs in Automobile Industry
Amit Sharma is Vice President – HR, and member of the Country Management Team for Volvo Group India. In a career spanning more than 2 decades, he has earlier worked across various HR roles with top of the line organizations, in a diverse set of industries such as Indian Oil, Johnson & Johnson, Philips, and TE Connectivity. Amit has received various internal and external recognitions for his work in HR and has been speaking on HR topics in various forums. Currently, he is also Hon. Vice President of the National HRD Network, Bangalore Chapter.
Amit is an MBA(HR) from UBS, Panjab University, Chandigarh, and an Engineering Graduate from Thapar Institute of Engineering & Technology, Patiala. He has also done Diploma in Training & Development from ISTD New Delhi. Apart from being a certified OD Practitioner from ISABS New Delhi, he is also a Coach.
Q- What is the impact of the COVID-19 pandemic around the world in the Automobile sector?
The second quarter of 2020 was characterized by the COVID-19 pandemic and its negative effects on society and economic development. The outbreak of COVID-19 created uncertainty among customers and dealers. Measures adopted by countries to control the spread had a significant impact on production and supply chain as well as on-demand for automobile products and services. Since the record levels of demand in Q2 2019, demand anyways declined as part of a normal cyclical slowdown, however, this was significantly accelerated by the pandemic.
Trucks customers faced slowdown due to the pandemic effect with a reduction in demand across all-region in the net sales as well as order intake. Bus operators across the globe faced severe effects on travel from the pandemic. Customers that are operating coaches and tourist buses have been particularly hard hit with large parts of their fleets idling. Whereas demand is low in the coach segment, the transformation to more sustainable public transport continues with stable demand for electrified city buses. Construction Equipment Industry saw significant drops in market volumes in most major markets such as the US, Asia (except China), UK, France, Germany, and the Nordic region.
Overall, net sales decreased and manufacturing activity went standstill. Many companies took forceful actions to reduce activities and costs, including salary reductions, temporary layoffs as part of government programs, and a reduction of purchased services.
When countries started to open up again, both fleet utilization and order intake began to recover. However, there is still significant uncertainty about the future economic development and demand for the products.
Q- Have you laid off your employees in India because of the pandemic, what is your People Strategy now?
The Corona epidemic and the global measures taken to fight it has led to a market situation impacting our industry severely. The effects are lower demand going forward and hence the need to continue to adjust our organization accordingly. In parallel, we need to accelerate the competence shift needed for new technologies and business models.
During the second half of this year, the Volvo Group plans to globally rationalize the white-collar workforce with approximately 4,100 positions where around 15% are consultants.
“However, in India, we have a growth story and hence plan to further build on our presence here and hire for specific competencies, esp. in the areas of Technology and Global Services.”
We have continued our lateral hiring for key capabilities and also have been consistent in hiring fresh talent from our university hiring programs.
Our People Strategy is focused around 3 principles – Business & Culture Alignment; Employee Growth; and Value Addition & Creation. For this we are working on creating Agile Workforce &Organization Models which will be future business relevant; shaping a Culture of Perform & Transform thus rejuvenating our culture; ensuring an Inclusive and Diverse Workforce for better organizational performance and decision making; building Future Capabilities and providing a Personalised Employee Experience.
Q- How do you see the employment scenarios in the next couple of months in your industry?
This pandemic has made us all realize the need to have agile workforce models. Interestingly, while all progressive organizations do Workforce Planning, however, I can say it with confidence that most would have never accounted for such unforeseen situations, which may not allow the workforce to come at all to the workplace, thus disrupting the business!
“Traditionally, our industry has had two workforce models – one which has more of a core staff and second which has more outsourced staff.”
For businesses, that employed more core staff, were saddled with higher fixed costs even when the revenues dried up due to lower demand. On the other side, businesses, which had more outsourced staff, there was a dip in their workforce availability when the economy started opening up after the lockdown; people were just not willing to come in and the outsourcing partners were struggling to find people who would come to work or even work remotely.
Industry today is discussing what that right workforce plan for us would be, considering that both high core and high outsourced staff models have their own set of challenges. The future shall a workforce model which is more hybrid, which takes into consideration both these aspects of core versus outsourced, and at the same time have flexibility that can meet the sudden demand fluctuations.
But in either of the models, there will be an upside in the employment opportunities in India. With focus on ‘Atmanirbhar Bharat’ and ‘Make in India’, there will surely be a surge in the employment opportunities in manufacturing. Companies shall expand their manufacturing footprint in India and hence lead to more employment generation. Another area we will see an upswing in is Technology related jobs. The world has started recognizing India as a Competency hub in Engineering & Technology. What had started a few years back as a cost arbitrage, has now blossomed as global competency center in Technology. Third area, which will be a boost to employment shall be BPO and KPO services, where the cost competitiveness of India will set the stage for further employment generation.
Q- How do you see the scope of the Gig economy in coming days in the Automobile sector and how will it reshape Jobs?
I will refrain from using the word ‘Gig’ as that to me means ‘temporary positions where there are short-term commitments’, but will use the world ‘Partnership based Employment Model’. The world is moving towards Partnerships over Competitiveness and the employment scenario shall be no different. There will be a web of partnerships – with start-ups, academia, specialized organizations, and independent consultants. We will have people from across functions like regulators, industry, academia, and startups, all sitting together solving problems on mobility. Once these challenges are highlighted, teams shall work together in the most transparent, open, and ego-free environment and thus finding relevant solutions.
The key decision point shall be what skill/competency/ process an organization considers core to itself and keep it with itself with core workforce; for the rest, there will be partnerships based workforce. The specifics will vary from organization to organization, but the principle of these partnerships shall be the same.
The automobile sector is poised to grow and thus collectively, there will be growth in all kinds of employment opportunities.
Q- What are the challenges in adapting to the Gig economy, how can HR keep retained Gig workers, freelancers, and contractors?
These Partnership based Employment Models need a completely different mindset in Employees, Leaders, and HR Managers. The hierarchies shall get shattered and respect shall be for knowledge over role or title. This mindset shift shall be the biggest challenge.
The next challenge shall be the ability to leverage these networks. Influencing these networks without formal authority shall be a key competency to develop in employees.
Employee growth shall be based on the ability to leverage collective intelligence across all kinds of the workforce (regular, partners, consultants, etc.) rather than just on technical delivery. Collaboration shall be the key here. Building this capability shall surely be challenging.
Another challenge shall be building the organizational culture with such a diverse and non-connected workforce – a workforce which has no long term stake in the organization and parallelly works with multiple organizations.
The last key challenge I foresee is putting together HR policies and practices for such a diverse workforce. How to engage, how to reward, how to define benefits, how to recognize, how to manage performance, and how to manage employee relations – all these shall be challenging for the HR team.
Q-Any concluding remark?
This pandemic is like a huge pause and a reset button and an important lesson for humanity. It is clear we cannot tackle such pandemics if we do not trust each other, care for all, respect the dignity of labour, and find the delicate balance between lives & livelihood. An inclusive & humane future will not happen if we do not make informed and conscious decisions and it is indeed critical for our sustainable future.
Also to mention, building new capabilities in the Managers shall be the key in dealing with future workforce esp. building Adaptive leadership. Organization designs shall get more networked over traditionally hierarchical or matrixed. Successful shall be those, who shall be able to leverage these networks, irrespective of whether they report to them or not. Every crisis breeds new opportunities, and those who will capitalize on these opportunities shall be the new stars.
Thank You, Amit!