Press Releases

UK, January 19, 2006 - The major HR challenge facing multinational companies offshoring to India is not in recruiting, but in the retention of talent in a growth market, according to Watson Wyatt.

Talking to Simon Dudley in the latest of the firm's 'Rewarding Conversations' web-based video interviews, Bob Charles, head of employee benefits consulting in Asia-Pacific at Watson Wyatt, said: "The market has moved on and companies are being forced to review their strategy for reducing the cost of employee turnover."

According to Watson Wyatt, many companies have been confronted with the surprise cost of high staff turnover which has negatively impacted the cost savings of offshoring. "Retaining quality people is a CEO issue in India, not purely an issue for HR," said Bob Charles. "In the past companies have strived to retain staff with competitive pay and developing a social and attractive work environment but increasingly that isn’t enough. Employees are looking to work for organisations which they perceive to be professional in their business operations on the basis that experience with a quality employer is the best form of training."

HR in India has tended to focus most on benchmarking base pay to try to avoid losing staff to higher paying competitors. But increasingly employers are recognising that this alone cannot ensure low turnover – indeed, not all employers can pay above market rates. In our opinion there is a need to focus more attention on performance related pay, incentive plans and retirement benefits.

"There has never been a greater need for HR professionals in India," said Bob Charles. "Offering competitive salaries is important but not the whole story. Employers have been overly cautious in not wishing to develop talent for competitors. It is a Catch 22. If companies do not invest in the career development of their people then employees will move on quickly anyway."

The video can be viewed at www.watsonwyatt.com/europe/news/videos/conversations.asp

For more information contact:

Claire Barraclough
Public Relations Adviser
Watson Wyatt Limited
+44 (0) 1737 273390
claire.barraclough@watsonwyatt.com

Watson Wyatt Worldwide
Watson Wyatt is a leading global human capital and financial management consulting firm. The firm specialises in employee benefits, human capital strategies, technology solutions, and insurance and financial services and has 6,000 associates in 30 countries. The firm is located on the web at

www.watsonwyatt.com.