SK Swamy, Chairman and Managing Director, RK Swamy BBDO, gets candid with People Matters over leadership, talent management, growth and much more...

Tell us about the RK Swamy Hansa Group. How did you create an organization with different business units?

The group name RK Swamy Hansa was given after the entities were born. We felt that we were offering a wide range of services under RK Swamy BBDO and under Hansa. What we offer under the RK Swamy BBDO brand is Communication services, and under Hansa are a host of  Marketing services.

The growth of the marketing services industry has been at a faster rate internationally than the communication business, but we realized that if we have to have a play in this business, we need to have a range that covers both areas. The reason is that both have growth potential in this market, and also that the client normally will require support in both the areas. We are hence leveraging our strengths and capturing more opportunities by offering both marketing and communication services under the group umbrella.

We realized that if we are in either of the two spaces, and not in the other, we are not offering the complete spectrum of solution. For becoming a big player in this space, we need to offer both these services. Five years ago we consciously started developing the group structure to cater to the full spectrum of this business need.

How do you decide to enter a particular business or vertical?

What we are doing is not new that others have not done either in India or internationally. So there was no formal feasibility study done for entering into any of the allied business line. More often, you can sense the feasibility based on your experience and the business opportunity. We always explore business ideas by talking amongst senior management, understanding the potential, analyzing risks which may outweigh the potential in certain cases, and then take it forward from there. I would say it isn’t rocket science. It is more often than not a dialectical approach, where teams are involved in exploring ideas, options and eventually the execution of the same.

We also wait for the right person to take charge of the business segment we want to enter. Till the right person is identified, we normally let the idea drift. We believe that when it comes to start-ups, the person to head that is more important than the business itself.

What are the different services RK Swamy Hansa offers?

We are in Advertising Creation, Media Planning & Buying, advanced Marketing Analytics, Specialized HR Communication Services, Social and Rural Markets Communication, Healthcare Communication, One-to-One Communication, Digital, Interactive and Mobile Communication, Events, Exhibitions, Activation, Promotions, Retail Identity, Public Relations, Outdoor management, Media and Brand Consultancy, Market Research, Development Sector support, TV Content Creation, Continuing Medical Education, among others.

All these verticals are different from each other, how do you manage the mix of talent pool?

We follow a simple principle: People come first. Identify the person to lead the vertical - team and business will follow.
Getting exceptionally talented, as well as committed people is a nation-wide problem. We would consider ourselves more fortunate. At top levels, we have a great team of highly committed people, who sometimes manage work of many people. And our top management has stayed with us for many years. Our attrition rate is also quite low at senior levels too.

Yes, we always are on a look out for ‘good’ people across the board. We do need a mix of talent to run and support our various verticals and our HR and top management team is always hunting for talent. We have formal training systems in some established verticals; and in smaller ones we rely on recruiting experienced hands. Generally, at the operations/middle management level is where the challenge lies. For middle management level roles, attracting the right people and retaining the good performers is one of our biggest challenges. We too have our share of problems and concerns in this area.

How have your recruitments been over the last one year? Has the economic slowdown affected your hiring plans?

Over the last 3 years - from 2006 to 2008 - we hired about 30 MBAs each year from major business schools specially to build the middle level capacity and also to groom talent for future leadership of the organization. In 2009, we put our hiring plans on hold. It’s a pause, not a stop. We are planning to hire again in 2010. We decided that the focus for this year was to look after the employees that are already with us and reward them to some extent, and not on getting new talent onboard.

How is the attrition level at your organization, and how do you manage that?

There is attrition of course, especially within this group of MBA that I was referring to earlier.

I rationalize it at 2 levels: On the one hand, we look at attrition as something the group gives back to society; when people experience and learn at RK Swamy BBDO and leave for other career options, they take their learning with them and that increases the overall competency of the industry and country. On the other hand, people who have worked with us become our brand ambassadors wherever they go.

We have long recognized that attrition cannot be avoided but can be minimized, and the life span of the employee in the system can be elongated by creating an environment where everyone can contribute to organization building.

You have been growing year on year. How do you manage this growth, especially in a year like the one gone by where economic slowdown has hit every business?

2008-09 was difficult in the second half. 2009-10 also appears uncertain. In this economic situation when many advertisers are treading with caution, our attitude cannot be any different. We recognize that it is impossible to grow in every vertical at the same pace. For example, our exhibition business has not shown growth this year. This is attributed directly to the market condition. On the other hand, our Activation business is doing very well because companies are keen to engage with their consumers to increase sales. This segment of business connects consumers with products, which leads to improved sales.

Our communication business which always saw a double digit growth, will probably see a small growth this year, but we anticipated that and budgeted our costs accordingly.

Yes, clients’ expectations have increased. They want more for less. Fortunately, we have been able to ward off requests from clients for lowering of our remuneration by offering them higher level of service and/or other add-ons.

Take us through your appraisal process across teh board. How do you manage people goals vis-à-vis your company goals?

We have developed a formal Performance Management System (PMS) for all employees in the business of development, creation and placement of our work. Our Support staff has another equally good system. Our PMS has standardized KRAs for various levels. Two levels of evaluation is done with the employee concerned. The PMS leads to payment of variable pay, training gaps determination and career planning.

Personally, I find it very stressful to appraise the top management, the only layer I am obliged to do personally. These people actually run the company and it is always difficult to highlight their short comings, however sugar-coated the comments can be. They tend to argue and disagree, and you still have to keep your cool and make your point.
Our system of compensation intrinsically aligns our people to company goals. In addition to salary correction/review/adjustments, our variable pay also has two components – one based on individual performance (qualitative parameters) and other based on the Units or Company’s performance (quantitative parameters). This system is well understood by everyone and served our purpose well.

How do you select your senior management team? What do you look for while hiring them?

As I indicated earlier, we have been very fortunate to have a team of some phenomenal performers who are self motivated and very driven. We always look for people who are thorough professionals, good human beings, and have a good fit to the company culture. We do not want individual star performers; we believe in team work and team achievement. We want our senior managers to have authority, but not act bossy. To me, ‘boss’ should be felt, not flaunted. Our culture is a very engaging and participative one. We do not want bosses around!

What is the one thing you aim at doing for your organization in the coming year?

The one thing we have been unsuccessful in doing so far is to set aside a per centage of profit for social causes. We do it on ‘ad-hoc’ basis, but we need to structure it in a way, where each of our companies sets aside this contribution. We owe this to ourselves, to our society.