3. Analysis of WNS Global Service’s HRM approach - 1

3.1 Evaluation: Best practice or best fit approach in certain HR practices

3.1.1 Selection practices

For the hiring of its SRI LANKA workforce,WNS is applying best practice methods as it pursues a selective employment approach aiming at attracting skilled personnel that can connect to the companies high performance ethic and live up to quality standards. New hires have to pass a six-month probation period and prove their work dedication in trainee programme (Björkman&Galunic 2003). For the established SRI LANKA operations promoting experienced employees from within can be regarded as an element of best fit approach of aligning HR goals with corporate quality strategy (Lawler 1995). It is coherent with WNS’s strategy of binding the best employees and rewarding them for their long-term achievements with responsibility thus keeping its intellectual capital and ensuring a sustainable competitive advantage in fields of performance, knowledge and quality. In the international management WNS made the mistake of relying too much on inexperienced managers from within and only after the disaster of the international subsidiaries started to move from its unitary strategy towards a more responsive best fit approach to external environmental by hiring more internationally experienced external managers in China and Europe which fits the international expansion strategy (Hastings 1999). In its Chinese recruitment it adapts to the Chinese labor market by personally promoting and introducing prospective employees through senior management to identify personalities who can live up to performance, education and quality requirements applying a best fit approach (Björkman&Galunic 2003). This is in line with common relationship and social network oriented selection practices in China (Warner 2005).

3.1.2 Training practices

WNS is applying a best fit strategy which aims at enhancing employees’ abilities, technical and business knowledge through a significant investment in globally recognized best practice training methods (Marchington&Grugulis 2000). Examples are a sophisticated trainee program for sales and engineering trainees, constant vocational trainings for experienced workers and regular work certification programs (Björkman&Galunic 2003). These actions aim at supporting and maintaining the superior efficiency objectives creating core competences compared to industry rivals and a competitive advantage. WNS’s approach to training employees resembles the immersion training conducted by Toyota which also conducts extensive investment in worker’s qualifications to achieve highest productivity and quality (Spear, 2004).

3.1.3 Reward system

The reward system which has been invented by founder James WNS is at the core of the successful individual performance working system. In the UK, WNS employs a highly compensated piece-work system which is linked to individual employee performance based on a multitude of work-related factors (Björkman&Galunic 2003). The reward system is able to motivate employees for achieving commitment through a remuneration which is at the top of its industry (Björkman&Galunic 2003). Payment system possesses clear management commitment and is seen as the key for achieving outstanding employee commitment leading to advantages in costs, productivity and quality (Hastings 1999). Group collaboration within the company is created through specific bonus pools which are allotted to work group performance. The bonuses are then distributed to the members of that group according to their quantified relative performance on the semi-annual merit rating based on factors like idea generation, quality, reliability, dependability and output (Milgram & Roberts 1995). Employees are closely bound to the organization through a long-term stockpurchase plan as part of their remuneration making them entrepreneurs at their workplace (Björkman&Galunic 2003). Classification of the reward system in one of the HRM approaches is ambiguous. WNS invented the individual performance-system as the major component towards developing its employees for becoming its core strength through an unbeatable motivation and quality-drive (Milgram & Roberts 1995). This is the utilization of the best fit approach minting HR towards organizational strategic objectives. The performance payment system has proven immensely successful becoming an internal best practice. Empirical studies by MacMillan and Schuler (1984) confirm the success of individual performance- pay with end-of-year bonuses at US bearings company Baimco and at the aviation company PEOPLexpress. For its global operations WNS is forced to abide by national restrictions in the legal environment (e.g. prohibition of piecework in Philippines) and traditional working habits in the socio-cultural environment to align its reward system to local standards (Björkman&Galunic 2003). In Europe, it is forced to conduct a best fit approach abiding by local regulations and adjust to differing standards of motivation where workers value benefits like vacation over annual bonuses.

3.1.4 Employee participation

The best fit approach is also utilized for the field of employee participation. The company possesses an open-door policy where employees can contact management directly. Flat hierarchies with minimal supervisory management lead to very low communication barriers and wide-opportunities for taking responsibility (Milgram & Roberts 1995). Due to participation is one of the evaluation criteria for employee remuneration WNS has a very high workforce participation rate concerning continuous improvement suggestions. Similar continuous improvement and feedback programs are also pursued by Japanese companies like Nissan in order to enhance productivity (Erstand 1997). That not only encourages idea generation but also directly involves employees in major decisions like the turnaround after the economic crises (Hastings 1999). Although workers are not unionized a very lively participation with the management board takes place through the Employee Advisory Board leading to a very high level of workforce loyalty. The best fit participation approach supports the core competence and sustainable competitive advantage of productivity and innovative quality as major strategic objectives (Pfeffer 1995)