MNCs collapsing, rightsizing, or getting acquired have created a certain amount of anxiety in the past few years, which the present crisis has served to heighten. MNCs have always tended to be a high-risk, high-reward career option. Right now, the risk part is in everyone’s face. Slowly but surely, employees perceptions about the safety of MNC jobs have begun to change. The same trans-nationals which were every MBA graduate’s dream destination are being viewed with skepticism. MNCs are no longer considered to be too big to fail and they are certainly no less vulnerable than Indian companies.
Two days after Lehman Brothers announced that it was filing for bankruptcy, the HDFC career portal saw a record 2700 hits in a single day. On a normal day, it averages between 800-900 fresh applicants. HDFC Bank is suddenly considered to be a safe haven in the financial market turmoil.
The collapse of companies like Enron and Anderson were the first reminders to the Indian employees how the cushy jobs can vanish in a jiffy; even earlier, big b-school recruiters like Booz Allen Hamilton had packed their bags and left on the basis of a shift in global strategy.
In the past few years, some of the marquee names – IBM, Pfizer, Yahoo, HUL, Sony have fired employees in right sizing exercises, shaking the confidence some more. Lately, employees of MNC subsidiaries like Gillette, PeopleSoft and Aventis have had to deal with the aftermath of M&As, where people were asked to move out because integration did not leave them with a job.
There are some factors that are inherent to MNCs that make the jobs more slippery. The matrix reporting structure based on verticalisation or geography is a tricky walk, and many Indian head honchos have slipped in the maze. MNC managers say the time taken in building consensus among various bosses in the matrix is frustrating and becomes downright dangerous if you get on the wrong side of any one of them.
One high profile CEO of a media company, for example, had to quit overnight as one of his bosses complained that he wasn’t being kept in the loop. In such a structure, the job content can be limiting. The matrix structure of the MNCs leaves you partially in-charge. Then the realisation sets in that you don’t have a full job.
Then there are MNCs for which India is a relatively small market, for which the global headquarters is not willing to make special concessions. One of the problems with working with a centralised company is that its strategies are global and it does not create differentiated strategies for markets like India. For example, Wartsila (India) was never able to convince their Finnish parent to make power generation products tailored for India. So they had to go with what was produced for the global markets.
Changes of fortune can be sudden in MNCs, precipitated by an internal reorganisation or just a change in focus or a sudden decision to downsize or wind up operations and senior staff members suddenly get a mail that says coldly, “You are required to complete the formalities of the closure.”
MNCs alone are not to blame for the glitter fading. Another reason why they are losing their sheen is because Indian corporates are getting their act together. A few years back, the gap between MNCs and Indian corporates as an employer of choice was a big gorge which few dared to cross.
That’s changed with the coming of age of Indian groups like the Tatas, Birlas and Mahindras, who now match the MNCs in terms of compensation and job content. The paradigm started to shift 4/5 years ago and now the pendulum is swinging their way. Rather than the push factor out of MNCs, it’s the pull factor of Indian corporates that’s leading this trend.