Kuldip Maity

The coronavirus pandemic is leading companies and organisations to introspect about the gamut of practices from the organisation of production to managing human resources.For organisations having to function during the lockdown as well as those who will have to pick up the pieces when they reopen, the big challenge is to optimise performance despite the resource crunch.

The bottom line now: the employee-employer relationship is back in focus.

We must admit that over the last few decades the humane face of all organisations has been felt as fading. This has widened the gap between employees and their employer.The loyalty factor that once took the centre-stage in business relation has ebbed in the age of electronic relationship. There was a time when an enterprise could depend on its staff to bear with the management and slog along to keep the business afloat during a period of crisis.

The crisis created by the coronavirus lockdown,while imposing a lot of hardship, has also created the crucial space for rethinking the values of the past and the associated long-run benefits of a cordial and humane employer-employee relationship. The coming days are not going to be easy. Difficult times, due to the deprivation that it brings in its wake, are also times for increased level of conflicts across various societal and economic relations. Managing conflict on the shop or office floor therefore would also be crucial for maintaining productivity or even raising it. The bar for human resource management is going to be at a new high.

The conflict management will just be a part of the game. The greater challenge, especially for smaller companies, will be in retaining talent. Given the inevitable economic downturn, the salary across the spectrum will be compromised. Talents will try to preserve and raise their remuneration by moving across into bigger companies. That’s a natural inclination that can only be reined with better employee-employer relationship. The companies that will be able to play the loyalty card will win in this race.

And then of course there is the issue of raising productivity. The game of survival in the coming days will be to generate greater productivity in relation to a salary level that would tend to remain pegged at the current level for some time to come. Given the choked supply in the market and all business entities trying to kick start their operations, the prices are predicted to rise. This, together with a stationary or even lower remuneration package, would imply a reduced real income for the salaried. The motivation factor for the employee to contribute beyond their ability will therefore be low. Those companies with a good track record in caring for the employees will have every chance to do better given the challenges the economy is throwing up.

The time, therefore, has come for us to rejig and rethink about HR. The employees indeed are resources. But we must transcend our traditional thought and think of it as Humane Relation, should we intend to overcome the current challenges and win the game.

The big fat Indian weddings! If one were to describe the social discipline of affluent Indians, these four words would be enough to describe the segment. Loud and flamboyant – that’s what we Indians are often perceived by the outside world. Unruly is the word that captures the essence.

Let’s pause and reflect. There are a few points to note about the stereotypical behavioural spectrum that sums up us Indians. Spitting out of the window of a luxury car is a common occurrence on Indian roads. Starting from the rich down to people below the poverty line, if one habit were to stand for the whole of India, it would be that of indiscriminate spitting without a care for the location. It is a health threat that nobody seems to mind. And then there is the herd mentality and the rumour mongering. But there is one positive that washes out all of it and that is the willingness to join hands in times of a crisis.

Such a stereotype, in any form, acts as a marker or as an indicator of a national trait. For example, when we talk about the Japanese the stereotype is reflected in their discipline, punctuality and complete obeisance to societal rules. Their cleanliness is legendary and they are brought up to follow rules to a fault. Indians are opposites. At least, that is how the impression goes.

Is the lockdown tempering the unlikeable social traits that we Indians are known by? It’s difficult to say with certainty. One cannot change entrenched and shocking traits of a society but the threat of death has a way with people. From ration shops to airports we are known to jump queues or try to do so sneakily. But the call for social or physical distancing has made the queue an orderly line, with people keeping gaps in the front and back. We have never been known as a great respecter of an individual’s personal space but the coronavirus lockdown has made us realise that breathing down the neck of the person ahead carries a personal health risk besides being a threat to the other person’s right to keep his position in the queue.

Being socially responsible starts with the realisation that breaking a rule might hurt you more in the long run. With lockdown and the attendant message that is being driven in is about trying to protect oneself from the dreaded coronavirus affliction. A new social rule is taking root. Keep a physical distance from others to keep the coronavirus from spreading.

We are slowly learning to follow rules. If it embeds into our social DNA along with the existing trend of helping our neighbours, we could give a run even to the Japanese for their yen.

Even if the lockdown is lifted, the threat of the coronavirus may not. And we would need to discipline ourselves into behaving the way we are behaving in the lockdown imposed by the government.

Let us retain our fame for that fat Indian wedding without being pompous. Let this lockdown make us socially more responsible.

A recession is seen as an economic downturn due to a sustained lack of demand in the market. The coronavirus pandemic has already disrupted economies across the globe; if it is not stopped in its tracks, a recession of severe proportions is the only likely outcome in the near future.

In fact, Morgan Stanley fears a severe recession as early as the first half of 2020 with demand falling and supply chains disrupted.The coronavirus pandemic has triggered a wave of economic disruptions across the globe, threatening in its wake a long-standing recession. Morgan Stanley is expecting the global growth rate to contract by 2.3 per cent over the previous year.

Chetan Ahya, chief global economist at Morgan Stanley Research, has said the bulk of the economic pain could be concentrated in the first half of 2020, if one assumes that the Covid-19 outbreak peaks by April-May. Given the aggressive policy responses across the world, growth is expected to recover to 1.5 per cent year-on-year in the fourth quarter of the fiscal.

“Global growth for full-year 2020 will still see a decline of 0.6 per cent year-on-year, past the 0.5 per cent year-on-year rate of contraction we saw during 2008 and, on our estimates, the weakest pace of growth during peacetime since the 1930s,” the report says.

“At its core, the outbreak represents a substantial shock to incomes, and the impact on aggregate demand will ultimately create renewed disinflationary pressures,” Ahya wrote.

What Morgan Stanley is saying here is truly worrisome. The hint here is about a sustained global recession that the world hasn’t seen during peacetime in the history of the industrialised market. Ahya, however, finds a silver lining in the coordinated policy responses with interest rates across the globe moving south almost in sync.

For the International Monetary Fund, however, the call to action is now. On March 27, after a meeting of its financial committee representing 189 countries, the Managing Director of the IMF, Kristalina Georgieva, declared a state of global recession and called for reinforcing its war chest by doubling it. She, however, optimistically declared a recovery in 2021.

Be that as it may, it’s clear that a recession, given the circumstances, is already on us. So, the issues are: a) the quantum of the setback, b) the period of the recovery.

The higher the quantum of setback, the greater will be the period of recovery. The question right now is how to tide over the difficult time. How to achieve it remains the big question. But one thing is undeniable – the only way to tide over the crisis is to stick together and abide by the government’s advice.

Unexpected things happen during times of crisis. World War II killed millions, destroyed families and economies, yet it also gave birth to the digital computer and Britain’s National Health Services. The United Kingdom is fighting the coronavirus with an army of health workers drawn from the NHS, while scientists from various countries, including India, are busy cracking the challenge posed by the novel coronavirus on the descendants of Colossus, the first digital computer.

The crisis unleashed by the coronavirus on the Indian economy has similarly had an unexpected outcome – the widespread adoption of the work-from-home culture, considered untouchable across a spectrum of industries in the country. While the culture of working from home has been taking root in the West for quite a while now, Indian corporates have steadfastly fought shy of encouraging anything remotely like it.

However, as CNBC reported on March 23, the movement of working from home has been on the rise in the USA. It quotes Gallup’s State of the American Workplace 2017 saying that 43% of employees work remotely with some frequency. Research indicates that in a five-day workweek, working remotely for two to three days is the most productive. That gives the employee two to three days of meetings, collaboration and interaction, with the opportunity to just focus on the work for the other half of the week. And tends to save a lot of per-employee operational cost for a company.

In India, the culture of working from home has never been a hit with the corporates. However, with the government ordering a nationwide lockdown to halt the highly contagious coronavirus, many companies were forced to encourage people to work from home wherever possible. The quantitative outcome will only be known after a while but what can be said with certainty is that many households are witnessing something novel – the office-goer doing office from home.

However, while many companies had to allow work-from-home in the face of the lockdown, the concept has to pass the test of voluntary performance on normal days. Though the technology to allow people to work from home efficiently already exists, the Indian office-worker will have to demonstrate the skill of balancing official work against other demands in his or her personal space.

Going forward, what would be of interest to note is whether ‘work from home’ in India will be considered a gift from the days of the coronavirus.

I keep coming back to the discussion on social collateral as it is the core model we follow in our microfinance business. The concept of the social collateral model consists of social capital (trust and network), group pressure and training and is used as a supporting mechanism to encourage loan repayments and support the borrowers in creating human capital and economic capital.

Implementation of the microfinance model by Dr Muhammad Yunus in Grameen Bank, its pioneer, opened up avenues for those who were struggling for survival owing to lack of financial capital or collateral but had the zeal and acumen to make a business successful. The way microfinance enabled small entrepreneurs to build on their dreams and enhanced their social and economic growth as well as their lives may not be comparable with other economic models so far. But what normally gets left out is the contribution of the social collateral model in other aspects.

Microfinance has constantly helped transform a job-seeker to a job-creator, thus impacting far more lives at the bottom of the economic pyramid. The structure of the social collateral model ensures that, jointly, a group of entrepreneurs ensures each other’s success trying to extend support wherever required. The social ties embed social capital and facilitate the collective actions of group members, allowing them to coordinate their repayment decisions and cooperate for their mutual benefit. This unique concept of collaboration at a micro-level is extremely encouraging to witness. The sisterhood extends much beyond business and helps in binding our social structure.

It would not be unfair to say that the success of the microfinance industry and its stakeholders banks heavily on the social collateral model. It has also created large numbers of jobs — for loan officers and risk assessors. These loan officers and risk assessors have the last-mile access to a large segment of the rural populace, especially the women, who never featured in our economic spectrum.

This relationship and reach of the officers of microfinance companies in rural India have been used on several occasions to power awareness programmes in financial literacy or even to distribute aid during calamities.

As we see, the direct and indirect impact of the social collateral model in microfinance has been much beyond keeping bad loans low. It has been playing a key role in nation-building as well.