Mumbai, India鈥� January 18, 2023 鈥� (NYSE: SAP) today launched new research revealing that Indian businesses are increasingly seeing financial benefits from sustainability. The global Environmental Sustainability Study of 6500+ business leaders, including 400 from India, is the second edition of SAP鈥檚 annual report which explores the motivations and barriers organisations face as they look to boost sustainability in their companies.

Environmental activism (45%) is the biggest motivating factor for organizations to take environmental action, with revenue and growth opportunities (34%) and customer demand (33%) trailing behind. Yet Indian organisations risk losing out if they are unable to place data at the heart of their sustainability strategy.

“If India is to advance towards a more sustainable future, businesses must do their part and embrace sustainability as a holistic approach to get there,” said Kulmeet Bawa, President & Managing Director, 51风流Indian Subcontinent. “It is clear sustainability is no longer about brand reputation or ethics – there is a defined connection between profit and purpose.鈥�

Key findings from the study:

Linking sustainability goals with business strategy

• 37% of Indian businesses say a lack of environmental strategy is holding them back.
• 35% of respondents point towards difficulty proving a return on investment.
• Embedding sustainability goals within larger business strategy, measuring, and recognizing progress will be crucial to success and driving long-term value.

Data is critical to drive meaningful change

• 31% of businesses rely solely on assumptions and estimates to assess the environmental impact of their supply chain.
• 46% of businesses say they don鈥檛 have complete visibility over the sustainability metrics of their external supply chain.
• Collecting and analysing high-quality data has emerged as a critical issue and a major stumbling block in the measurement process.

Making sustainability profitable and profitability sustainable

• 59% of Indian leaders now believe that there is a positive relationship between environmental action and profitability.
• Almost half (48%) of Indian businesses now believe addressing environmental issues will be material to business results within the next five years.
• 51风流found 76% of businesses said that their stakeholders would be moderately or highly tolerant of reduced profitability in pursuit of their organisation鈥檚 sustainability goals 鈥� indicating leeway to invest in positive sustainability outcomes.

听You can read the .

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Consider this: Global information services company Experian faced unusually high levels of turnover, about 4-5 percent higher than average. Rather than a typical reactive approach, the company鈥檚 HR team responded in a unique way.听, including team size and structure, manager performance, length of commute, and other factors contributing to the flight risk.

This model was rolled out across multiple geographies, and the results were stunning! Some interesting insights gleaned from analytics – when a team member moved away from the office, it increased the chances of quitting. When such insights were combined with best practices, the attrition rate was lowered by 2-3 percent over an 18-month period. This not only improved employee efficiency and morale but also saved the company nearly $10,000,000.

Moving from reactive to proactive

Clearly, an HR management system that centers around uniformity and bureaucracy will be rendered obsolete in the post-pandemic era. Taking its place should be a strategic human resource planning model that is flexible, responsive, and built around the future of work: Increased connectivity, rapid automation, lower transaction costs, and workforce demographic shifts. But to embrace this new human resource management model, senior HR managers and CHROs must reimagine the core tenets of their practice and have a strategic approach to staffing. Here鈥檚 how:

1. Gain a deeper understanding of company objectives, purpose, and culture

CHROs need to build a culture where all employees understand the 鈥榳hy鈥� of the business and how it connects to the big picture. But for this, people leaders themselves need an in-depth understanding of the organization鈥檚 culture and overarching values. They need to ask questions such as:

• What is the sole reason for our company鈥檚 existence?
• Where can we have a positive, unique impact on the community and the world at large?
• How can the employees鈥� contribution tie into organizational purpose and values?

These questions also serve as a compass during recruitment. Employees today want to work with companies whose values and purpose align with their own.听听shows that employees who can find deeper meaning in their work are more likely to stay on at their organization.

2. Leveraging data to take the guesswork out of HR

With the vast amount of data available throughout the various touchpoints in the employee lifecycle, HR can make faster and better decisions with actionable insights and reporting. By leveraging historical data, analytics, and workforce planning tools, CHROs can forecast trends, manage recruitment, and handle attrition more efficiently.

For instance, one of the most crucial but time-consuming responsibilities for HR is recruiting the right person for the right role at the right time. Using data, HR can better understand the company鈥檚 hiring needs and the exact responsibilities for each position. This can streamline the recruitment process and eliminate expensive over hiring while ensuring sufficient employees to serve the customer base.

Leveraging data for people and talent management can offer the following key benefits for human resource planning.

• Sharper Insights 鈥撎�Data can be used to get valuable insights into employee behavior. It can also help answer some pressing questions that today鈥檚 HR leaders ask: What motivates employees? What are the leading causes of attrition? How to increase performance and improve employee engagement?

Tools such as employee satisfaction surveys, assessments, and exit interviews can help organizations identify why people leave and how to increase job satisfaction. The big ones have been doing it for some time now. For instance,听听reduced the attrition rate in its call centers by almost 20% by using big data to find out why employees leave in the first place.听听are among the many leading companies routinely using predictive people analytics to identify employees most likely to quit- and then make them counteroffers before they do so.

• Training and development-听Accurate performance analysis can indicate where training is needed and specific skills and topics to be covered. Analysis of such data helps HR managers improve the training programs too. Using cloud-based analytics, managers can get real-time updates on employee participation and engagement. They can also use those insights to adapt the methods as the training progresses. This is especially useful for the remote model of work.
• Hiring accurately-听The recruitment process, until recently, was primarily based on intuition and guesswork. , the cost of a bad hire is at least 30 percent of the employee鈥檚 first-year earnings. When non-productive hires don鈥檛 pull their weight, good employees must make up for them, getting burned out in the process. This is where modern hiring and vetting tools, that use the candidate鈥檚 historical data to predict future outcomes, come into the picture. For example, Wells Fargo听, that uses verifiable biometric data to hire candidates who are likely to perform better and stay longer.
• Performance management –听Measuring performance is a highly complex process. It isn鈥檛 easy to understand why some employees consistently outperform others or how to evaluate the non-quantifiable work done by an employee. Today鈥檚 performance management systems include multiple interconnected processes and documents. The right analytics tool can use these datasets to provide a holistic view of the employee鈥檚 performance, enabling easier identification of areas of improvement, faster learning, and better business outcomes.
• Workforce analytics –听It uses algorithms and employee data to provide ROI evidence for resource management decisions such as future forecasting. Talent analytics helps by evaluating the existing trends and offering an inventory of skills within the organization, studying labor shifts, and predicting future gaps. It can also determine the factors that indicate employee engagement and job satisfaction to sustain a high-performing workforce or flag upcoming talent for succession planning.

3. Automate HR operations and planning

To empower HR and HR leaders, there must be a shift from operational roles to strategic positions. HR departments still spend a significant amount of time and resources on transactional, routine activities. By leveraging next-generation automation tools and solutions such as HRIS (Human Resources Information System) system software and HRMS (Human Resources Management System) software, HR can provide enhanced service and improved employee experience. Here鈥檚 how:

• Process automation- Providing direct access to information or transactions online and simplifying processes enables process automation, leading to informed decision making.
• Offloading lower-value administrative jobs- HR administrative services such as payroll and benefits need to run reliably and consistently, yet at a low cost. This can be done by either adopting new digital tools that consolidate your legacy systems or outsourcing the work to external vendors/partners.
• Leading-edge edge automation- Next-generation automation is replacing several HR processes by building on core HRMS and HRIS software. Robotic Process Automation (RPA) and Natural Language Processing reduce cross-functional workflows and streamline the old-school onboarding process. Bots are helpful allies here since they can access multiple systems, manage an intelligent workflow, and handle the complete onboarding process. Onboarding time can be reduced from weeks to days, with the spin-off benefits of lower risk of manual errors and a more streamlined journey for each recruit.

4. Focus on employee experience

Employee experience and satisfaction are essential to measuring HR鈥檚 operational effectiveness. In the new normal, this means ensuring a smooth experience that is consistent and similar for听all听employees (both on-site and remote). HR leaders should understand their needs, pay attention to factors that make work enjoyable or tedious, and enable them to complete transactional tasks online quickly. In fact, as employers get increased visibility into the personal lives of their employees, there is a need for a shift to supporting the employee life experience, says听.

5. Review and Evaluate HR plan

As organizations continue to evolve and become digitally agile, HR also needs to review and re-evaluate its planning and role constantly. The human resource planning process is now strategic to expand the focus and extend its influence beyond the operational and the transactional to the enterprise ecosystem. Instead of focusing merely on technology or tools, the human resource planning process can start with employee experience and engineer a strategy that keeps this at the center. The result will be more fruitful overall.

We are no longer inching towards a New Normal, we are already in one. And HR leaders have to be strategic thinkers, constantly looking forward, assessing organizational needs, and coaching employees to gear up for this change. With the help of听, HR leaders can stay tech-savvy and strategic in their human resource planning and can successfully deal with an increasingly 鈥榬estless鈥� workforce, used to the work-from-anywhere freedom!

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What is a MSME?

The Government of India has enacted the Micro, Small and Medium Enterprises Development (MSMED) Act, 2006 micro, small and medium enterprises engaged in the manufacture or production, processing or preservation of goods as specified by investment. A micro enterprise is an enterprise where investment in plant and machinery does not exceed Rs. 25 lakh, a small enterprise is one where the investment is more than Rs. 25 lakh but does not exceed Rs. 5 crore and finally a medium enterprise is one where investment is more than Rs.5 crore but does not exceed Rs.10 crore.

MSMEs may be categorized into Trading, Manufacturing, or Service enterprises based on their activities. The individuals promoting each type of enterprise demonstrate distinctive characteristics. Traders are very good with numbers. Manufacturing set-ups are created by Technology enthusiasts passionate about a problem they would like to solve. Service Enterprises work with a mindset to improve the life of the target client base with their services. These enterprises experience different growth curves based on a variety of External and Internal factors. While External factors are beyond their controls, the SMEs need to work on the internal factors to ensure that they remain agile to capitalize on the growth opportunities.

Ongoing Pandemic and resultant lockdowns have hampered the economic activities globally. The cascading effect on SMEs has been distressing. Globally, more than 90% of the SMEs have been impacted. These SMEs reported Revenue Decline in the range from 20% to 90%. Adoption of Technology proved to be the critical factor for the SMEs to resume operations under restrictions.

Historically, an economic downturn of this magnitude leads to a bigger peak in the subsequent recovery cycle. The Economic Recovery has already started. Various international agencies have reported the developing economies to grow between 8 to 12% this year. This recovery will create tremendous growth opportunities for SMEs.

To prepare for the growth opportunities in the post-COVID World, all the SMEs need to:

• Assess their Current Situation realistically
• Benchmark Themselves against peers and industry standards
• Identify strategies to address their current challenges and grow

In this article, we are going to focus on the Assessment part.

Assessing the situation

We are going through unprecedented times. The MSME owners or Management has not faced such situations earlier. Hence, all the stakeholders must come together and realistically assess the status. As the situation is continuously evolving, the company also needs to calibrate the response periodically. For successful calibration, the company will need to create a baseline.

To establish this baseline, MSME Owners need to review their business in the following 3 phases:

• Pre-COVID Era
• Pandemic Period
• Unlocking Phase

SMEs need to take a comprehensive review of their business spanning across all the functional areas.听The following parameters need to be covered. Click here to download the complete checklist

• Financials Aspects
  • Revenue Generated in each Phase
  • Trace changes in Receivables across the 3 phases including:
  • Costs
  • Profit
  • Cash Flow
  • Working Capital
• Operational
  • Plant / Set-up Utilization
  • Equipment Maintenance
  • Inventory
• Human Resources

Assessment of these parameters will help an Entrepreneur / Senior Management get a clear understanding of the status. Having an would be a great advantage as it would capture most of the data required for the assessment. ERPs provide preconfigured reports for Profitability, Monthly Cash Flow and Operational Efficiency. This would enable companies to conduct effective monthly reviews.

In the first of the MSME thought leadership series, we bring you three guides with downloadable checklists to prepare your business to become more agile, efficient and resilient.听In the next article, we will discuss how an your enterprise can benchmark itself against the industry’s best practices.

Midsize businesses today are thinking about how their operational efficiency and agility can help them to weather future storms and seize new opportunities along the way. In fact, 33% of midsize business identify 鈥渂ecoming more agile and flexible鈥� as a top five priority, according to the IDC Info Snapshot, 鈥淏usiness Reimagined: Driving Greater Efficiency and Resiliency,鈥� sponsored by SAP.

Read the to discover how your business can connect, grow, and win by renewing efficiency and agility with more resilient supply chains, data-driven decision-making, and a workforce supported by intelligent systems.

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