hrm report group 10

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TABLE OF CONTENTS

1. Acknowledgements__________________________________________3

2. Introduction________________________________________________4

About Accenture 4Company Description 4Corporate Citizenship 5Community Involvement 5Code of Business Ethics 6

3. Background________________________________________________7

Expatriates 7Expatriates in India 9Expatriate Compensation Approaches 11The Expatriate Compensation Package 13Issues in Compensating Expatriates 16

4. Scope of the Study__________________________________________18

5. Data Collection_____________________________________________18

6. The Questionnaires-For expatriates and aspiring expatriates__________19

7. Data Analysis______________________________________________23

For expatriates 23For aspiring expatriates 26

8. Limitations of the Study______________________________________28

9. Learnings_________________________________________________28

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Acknowledgements

We would like to acknowledge the help and support of Ms.

Rashmi Sharma without whose support this project would not

have seen the light of the day.

We are grateful to her for not only guiding us through this

project but also providing us unflinching support and endless

resources in making our endeavor a success.

We would also like to thank Ms. Deepa Banerjee, HR Manager,

Accenture India, Gurgaon for having provided all the help and

support during the different phases of the project.

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About Accenture

Accenture is a global management consulting, technology services and outsourcing

company. Combining unparalleled experience, comprehensive capabilities across all

industries and business functions, and extensive research on the world's most

successful companies, Accenture collaborates with clients to help them become high-

performance businesses and governments.

In India, Accenture follows a focused and targeted strategy that is responsive to the

structure of the economy and the needs of the marketplace. The current strategic

imperative is to enhance shareholder value by assisting Indian corporation in

developing and implementing strategic initiatives, cost management and top-line

growth. We are also helping Indian corporation to increase customer services levels;

improve efficiencies in operations and supply chains; and use IT as an enabler in

becoming globally competitive.

Company DescriptionAccenture is a global management consulting, technology services and outsourcing

company. Combining unparalleled experience, comprehensive capabilities across all

industries and business functions, and extensive research on the world’s most

successful companies, Accenture collaborates with clients to help them become high-

performance businesses and governments. With more than 180,000 people in 49

countries, the company generated net revenues of US$19.70 billion for the fiscal year

ended Aug. 31, 2007.

Our "high performance business" strategy builds on our expertise in consulting,

technology and outsourcing to help clients perform at the highest levels so they cancreate sustainable value for their customers and shareholders. Using our industry

knowledge, service-offering expertise and technology capabilities, we identify new

business and technology trends and develop solutions to help clients around the

world:

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Enter new markets.

Increase revenues in existing markets.

Improve operational performance.

Deliver their products and services more effectively and efficiently.

We have extensive relationships with the world's leading companies and governments

and work with organizations of all sizes—including 94 of the Fortune Global 100 and

more than two-thirds of the Fortune Global 500. Our commitment to client

satisfaction strengthens and extends our relationships. For example, all of our top 100

clients in fiscal year 2007, based on revenue, have been clients for at least five years,

and 85 have been clients for at least 10 years.

Among the many strengths that distinguish Accenture in the marketplace are our:

Extensive industry expertise.

Broad and evolving service offerings.

Expertise in business transformation outsourcing.

History of technology innovation and implementation, including our research and

development capabilities, on which we spend approximately $300 million annually.

Commitment to the long-term development of our employees.

Proven and experienced management team.

By enhancing our consulting and outsourcing expertise with alliances and other

capabilities, we help move clients forward in every part of their businesses, from

strategic planning to day-to-day operations. With more than 180,000 people in 49

countries, deep industry and business process expertise, broad global resources and a

proven track record, Accenture can mobilize the right people, skills and technologies

to help clients improve their performance.

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Corporate Citizenship

In our role as a global organization, Accenture believes we have a responsibility to

engage proactively with the communities in which we live and work. Corporate

citizenship nurtures motivation, employee pride and societal awareness through a

systematic framework which, anchored by a strong set of core values and Code of

Business Ethics, drives consistency and transparency across our businesses and

workforces. We take a holistic approach to aspects such as diversity, education and

environmental conduct, as well as community involvement activities, and aspire to an

integrated approach that positions corporate citizenship at the heart of our business

operations

Community Involvement

Accenture giving focuses on delivering tangible outcomes through a mix of financial

giving and the giving of the time and skills from our skilled professionals.

Giving: Financial Accenture giving focuses on delivering tangible outcomes through

a defined global program, diverse local country efforts, disaster relief and inspired

fundraising by our people.

Giving: Time and Skills Accenture offers its employees the opportunity to use their

time and skills to bring positive outcomes to diverse communities.

Accenture Code of Business Ethics

The Accenture Code of Business Ethics has been substantively revised and a new

version was adopted in September 2006.

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http://www.accenture.com/Global/About_Accenture/Company_Overview/OurCoreValues.htm


http://www.accenture.com/Global/About_Accenture/Corporate_Governance/CodeProgram.htm


http://www.accenture.com/Global/About_Accenture/Company_Overview/Corporate_Citizenship/Financial/default.htm

http://www.accenture.com/Global/About_Accenture/Company_Overview/Corporate_Citizenship/Time_and_Skills/default.htm




http://www.accenture.com/Global/About_Accenture/Company_Overview/Corporate_Citizenship/Financial/default.htm

http://www.accenture.com/Global/About_Accenture/Company_Overview/Corporate_Citizenship/Time_and_Skills/default.htm



The new Code is designed to: place more emphasis on Accenture's six core values,

give practical examples to our people of what these values mean in their everyday

work life, accommodate new legal and regulatory developments, make the Code more

user-friendly.

The new version of the Code is a result of the joint effort and work by many of our

people across geographies and functions. In particular, consultations were held with

our country operations and management in order to best accommodate local needs

and legal requirements.

One very visible aspect of the Ethics and Compliance program is our Code of

Business Ethics, which all employees must read and follow. Currently available in 16

languages, the English version was distributed in electronic form to all employees.

The Code emphasizes critical areas particular to our organization and business model

while highlighting aspects of conduct that are imperative for all employees. Our Code

does not incorporate or refer to all policies, but acts as a synthesis of the key policies

and principles that should govern all employees' conduct. Our employees periodically

certify their compliance with our Code of Business Ethics.

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BACKGROUND

Expatriates

An expatriate (in abbreviated form, expat) is a person temporarily or permanently

residing in a country and culture other than that of the person's legal residence.

The difference between an expatriate and an immigrant is that immigrants (for

the most part) commit themselves to becoming a part of their country of

residence, whereas expatriates are usually only temporarily placed in the host

country and most of the time plan on returning to their home country, so they

never adopt the culture in the host country.

During the later half of the 20th century expatriation was dominated by professionals

sent by their employers to foreign subsidiaries or headquarters. Starting at the end of

the 20th century Globalization created a global market for skilled professionals

and leveled the income of skilled professionals relative to cost of living while the

income differences of the unskilled remained large. Cost of intercontinental travel had

become sufficiently low, such that an employer not finding the skill in a local market

could effectively turn to recruitment on a global scale.

This has created a different type of expatriate where Commuter and short-term

assignments are becoming the norm, and are gradually replacing the traditional long

term. Private motivation is becoming more relevant than company assignment.

Families might often stay behind when work opportunities amount to months instead

of years. The cultural impact of this trend is more significant. Traditional corporate

expatriates did not integrate and commonly only associated with the elite of the

country they were living in.

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Modern expatriates form a global middle class with shared work experiences in

Multi-national Corporation and working and living the global financial and

economical centers. Integration is incomplete but strong cultural influences are

transmitted. Middle class expatriates contain many re-migrants from emigration

movements one or two generations.

The assignment of the expatriate employee can be classified as

- Short-term assignment (in any company being 0 to 12 months)

eg. A feasibility study

- Long-term assignment, (from 1 to 3 years)

- Permanent assignment, when the employee signs a permanent employment contract

Expatriates in India

The Indian job market is full of attractive opportunities, not only for domestic

talents but for foreign workforce as well. The number of foreigners seeking jobs in

India is increasing every year. Not only are the middle and senior level

expatriates coming to India, young graduates, who are on the threshold of

beginning a new career are taking up jobs in Indian sectors like IT,

Pharmaceuticals, Retail etc. According to a recent study by

Credence Research and Analytics (CRA), there are 40,000 expatriates in India

presently; and out of them, almost 15% are in leadership roles.

Even major IT companies like Infosys are having special programs for getting

students for premier universities like Stanford and Harvard to work with them.

Recognizing the fact that India is a growing economy, foreign universities are

sending their students to work in India so that they can have an understanding of the

Indian markets an environment, work practices and culture of the Indian

organizations.

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Why are expatriates ready to work in India? What attracts these expatriates to

fly to India? Some of the reasons that add to the trend of expatriates looking

for more jobs in India are as follows:

Growth Opportunities: India, being one of the fastest growing economies in the

world, offers a large number of growth opportunities to expatriates. More expatriates

seek jobs in India on account of job cuts, outsourcing, and high taxes in western

nations.

Compensation: Indian companies maintain external equity and are now

increasingly paying at par with the foreign countries. Expatriates with

specialized skills which are unavailable in India, due to financial and

technology constraint like molecular research, are being offered highly attractive

packages.

Attractive Positions: Companies are offering attractive leadership positions to

experienced expatriates. Key roles ranging from middle level managerial roles to

Departmental Heads are also being offered to specialized expatriates.

Adds value to resume: There are no second thoughts about how Indian experience

adds values to ones resume. It reflects an individual's hard work and ability to

adapt and deal with diversity. One gets to know the different cultures, improve

networking skills, and knows how to deal with people.

Increasing Unemployment: The rate of unemployment is increasing in

industrialized economies while the growth opportunities are increasing in South

Asian countries. As a result of this fact, many expatriates who have saturation in

their careers in their countries are heading towards Indian markets to grab the

opportunities here and move ahead in their careers.

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Apart for the advantages of working in India, there are certain factors that

reduce the chance of an expat to become successful in India. Difficulties in

communication and difference in cultures are two main factors for the same.

Expatriate Compensation Approaches

There are generally three approaches to international compensation.

They are:

a) The budget system - This system takes in all costs incurred by employees in both

countries (the home country and the host country). These costs and the effectof the local tax system, form the basis on which employee's income is calculated.

The system is extremely expensive to keep up there are many adjustments which

need to be made, notably in high inflation countries. If products and services

are not available locally, it will involve cost of importing.

This system has been subject to criticism from expatriates. The fact that the

employer determines what items will and will not be included in the budget is often

seen as paternalistic. Moreover, once expatriates know what items are included in

the budget, they will certainly try to get other (expensive) items on the list.

They feel that they know best what they will need in the host country.

b) The Local Growing Rate System - Under this system, the expatriate is

paid entirely according to the standards in the host country. This prevents

the situation where junior staffs are paid substantially higher salary than the

expatriate, who is compensated in conformity with the standards of income in

the parent country. The approach relies on survey comparison of local

nationals with expatriates. It is taken as a reference point in terms of benchmarking.

This method is less popular when employees are assigned to a less prosperous

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country, as it will result in profoundly lower salaries. Thus the local growing

rate system is mostly used for assignment to countries with clearly

higher compensation levels.

The advantages of this approach are: 1. it ensures equality with local nationals 2. It

is simple, 3. It identifies with host countries and 4. It ensures equity

among different nationals

The disadvantages of growing rate approach are: 1. it has variation between

assignments for same level of employees 2. It has variation between expatriate of

the same nationality in different countries & 3. It has potential re-entry problem

c) The Balance sheet or Home Made System - The premise that underlines

the balance sheet approach is that the same net sum must be available in both

the countries. In this context, net means the freely disposable income. The idea is that

the spending power must be identical in both the country. Consequently,

allowances will have to be made for cost of living, housing and generally accepted

spending patterns.

The balance sheet approach to international compensation is a system designed to

equalize the purchasing power of employees at comparable position levels leaving

abroad and in the home country and to provide incentives to offset quantitative

differences between assignment locations.

The objectives of the balance sheet approach are:

To ensure mobility of people to global assignment as cost effectively asfeasible.

To ensure that expatriate neither gains nor loses financially

Minimize adjustments required of expatriates and their dependents

The salient features of the Balance Sheet approach are:

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Basic objective is maintenance of home-country living standard, plus

financial inducement

Home country pay and benefits are the foundations of this approach

Adjustments to home package to balance additional expenditure in host country

Financial incentives (expatriate/hardship premium) added to make the

package attractive

Most common system in usage by multinational firms

Advantages of this system are:

It ensures equity between assignments

It ensures equity between expatriates of same nationality

It facilitates expatriate's re-entry

It is easy to communicate to the employees

One major drawback of this system is that it may cause large salary gaps within one

and the same subsidiary, particularly between parent-country nationals and

host-country nationals.

The Expatriate Compensation Package

The basic elements of an expatriate's compensation package are:

Basic Pay - Basic Pay is the amount of money that an expatriate normally receives in

the home country. The expatriate salaries typically are set according to the base

pay of the home countries. Therefore, a German manager working for a US

MNC and assigned to Spain would have a base salary that reflects the salary

structure in Germany. The salaries usually are paid in home currency, local

currency or a combination of the two.

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The base pay also serves as the benchmark against which bonuses and benefits

are calculated.

Benefits - About one third of the compensation is benefits. In case of the

expatriates it can be more. Most US based MNC's include expatriate

managers in their home-office benefits programme at no additional cost to

expats. If the host country requires expats to contribute to their social

security programme, the MNC typically picks up the tab.

Fortunately, several international agreements between countries recently have

eliminated such dual coverage and expenses.

Some of the common benefits are as below:

Housing: It covers a wide range of arrangements. Some companies provide with

a residence during the assignment and pay all associated expenses. Others deal

a predetermined housing allowance each month and let expatriates arrange their

own residence. Additionally, some organizations help those going on assignments

with the sale or lease of the house they are leaving behind.

Utilities: Some companies provide air conditioners, bottled gas, bottled

water, electricity, telephone and telephone call expenses.

Car: Car or chauffeur driven car with parking facilities are provided by some

organizations befitting the status or requirements of security of the employee.

Helping hands like servants, security guards are provided by some

organizations either representing affluence or power or status or all of them.

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Club subscriptions are also part of benefits of expatriates. The club

memberships and club fees along the entertainment power is also given by some. The

club may vary from recreational/social clubs to sports club etc.

Children's education benefits are another integral part of the

compensation package. These expenses cover costs such as tuition, enrolment

fees, books, suppliers, transportation, room, board and school uniforms. In

some cases, expense to attend post-secondary schools are also provided.

Reimbursement policies for relocation / repatriation - Some companies

would provide this as an allowance too - which involves moving, shipping and

storage charges that are associated with personal furniture, clothing, and other

items that the expatriate and his or her family are (or are not) taking to the new

assignment. It also includes temporary living allowance.

Assistance for spouse employment - to make up for loss of spouse's income

Leave / Vacation - Expatriates are provided with an annual leave which

normally varies from 25 to 30 working days, besides the vacation provided,

home holidays and rest and relaxation (R&R)

Insurance - Different kinds of insurance - including medical, life, dental, vision

etc are provided to the expatriates under global or local plans

Social Security Costs - includes the Retirement Benefits given to the

expatriates, which would be on a defined benefit or a contribution plan basis.

In the recent years, some companies, especially MNC's have also been designing

special incentive programmes for keeping expatriates motivated. In the

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process a growing number of firms have dropped the ongoing premium for

overseas assignments and replaced it with a long-time.

Issues in Compensating Expatriates

The Home or the Host Country - is one of the most common broad

issues with regards to compensation. Different companies would follow different

practices with regard to the same. A lot of them would follow diverse practices,

sometimes even on a case-to-case basis with the expatriates present. A majority

enroll expatriates for the host country benefit program, and maintaining the

payment of the base in the home country

Different nationalities - Difference in the compensation packages

offered to expatriates from different nations, like the US & the UK.

Companies would like to keep the salaries of professionals at the same level, from

different countries, at par with each other.

Economic conditions - both of the home and the host country. These

include currency fluctuations, inflation etc.

Multinational corporations have several options available for handling their

expatriates' salaries and allowances that will cover the many different economic

scenarios that can arise. For instance, an employee can be paid solely in host-

country currency, in US dollars entirely, or in a percentage between the two.

Many companies that are new to the international scene, with no sophisticated

policies in place, may have to get creative to keep their costs down and their

employees happy. One option is to offer guaranteed exchange rates or "protection

policies" for a certain percentage of the salary.

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Companies also split the salary between home- and host-country currencies, and

readjust the split as the need arises. Companies are going back to the use of

the cost-of-living adjustment (COLA) index to manage the differences in the

cost of living between the home and host country.

Taxation - Policies used for taxation by both the home and the host

country, the anomaly of double taxation etc

Similarly there can be other issues like nature of the assignment, the

assignmentlocation etc due to which the expatriates may need to be compensated

differently. Different kinds of benefit packages would be provided to expatriates,

which would vary according to the different needs of the expatriate.

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Scope of the Study

The project was undertaken to study the various issues confronting expatriates. The study

is limited to Accenture India, Gurgaon office employees.

Data Collection

The team visited the Gurgaon office of Accenture India and got the questionnaires filled

in person by expatriates who have returned to India after completing their respective

assignments as well as aspiring expatriates.

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The Questionnaires

For Aspiring Expatriates

QUESTIONNAIRE 1

ASPIRING EXPATRIATES

Q.1 Would you like to be an expatriate?(A) Yes(B) No

Q.2 What factors fascinates you the most? Rank them.

(A) Place(B) Perks(C) Project(D) Recognition or Career growth

Q.3 Would you like to go for?(A) Long Term (more than 1 year)(B) Short Term (less than 1 year)

Q.4 What is the selection procedure? _______________________________________________________________

Q.5 Are you married or single?(A) Married(B) Single

Q.6 If married, will they send your spouse along?(A) Yes(B) No

Q.7 Are there any family constraints?(A) Yes

(B) No

Q.8 What all are the formalities you need to fulfill before going? _______________________________________________________________ _______________________________________________________________

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Q.9 Are there any apprehensions?(A) Yes(B) No

Q.10 If yes, please

specify__________________________________________________________

QUESTIONNAIRE 2

FOR EXPATRIATES

Q.1 Where did u go as an expatriate? _______________________________________________________________

Q.2 What was the duration of your stay? _______________________________________________________________

Q.3 What was the selection procedure? _______________________________________________________________

Q.4 Are you married or single?

(A) Married(B) Single

Q.5 If married, did they send your spouse along?(A) Yes(B) No

Q.6 Were there any family constraints?(A) Yes(B) No

Q.7 What all were the formalities you need to fulfil before going? _______________________________________________________________

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Q.8 What problems did you face?(A) Language Problem(B) Food Problem(C) Culture Problem(D) Accommodation problem

Q.9 What type of accommodation you had there?(A) Company Provided(B) Own Arrangement

Q.10 Where were you working?(A) Company Office(B) Client Office

Q.11 How was the learning experience?

_______________________________________________________________

Q.12 How was the living experience? _______________________________________________________________

Q.13 Was there any bond signed?(A) Yes(B) No

Q.14 What all perks did u get?

_______________________________________________________________

Q.15 How was the work culture there? _______________________________________________________________

Q.16 Were you awarded or recognised for any new technology that you learnt over there?

______________________________________________________________

Q.17 Did you share your knowledge with others? _______________________________________________________________

Q.18 Were any special orientation programs held, to help you adjust better to thenew culture?

_______________________________________________________________

Q.19 Did you face any kind of gender bias or nationality issues? _______________________________________________________________

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Q.20 How were your queries answered by HR while you were onsite?(A) Excellent(B) Good(C) Average

(D) Satisfactory(E) Poor

Q.21 Would you like to go again?(A) Yes(B) No

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Data Analysis

FOR EXPATRIATES

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24



25



FOR ASPIRING EXPATRIATES

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Limitations of the Study

Paucity of time available for analysis

The scope of study is limited to a few employees of Accenture India

only

Learnings

A good insight into the issues involved in expatriate management

A thorough understanding of the process of conducting a primarysurvey

Inter-personal skills during the Data Collection phase.

Learnt a lot of of Microsoft Excel skills during preparation of graphs

and analysis

Different kinds of benefits / incentives / allowances accorded to

expatriates

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