Reference : Aditya Ghosh & Soubhik Mitra , Hindustan Times
Fake certificates, inflated salaries and designations, wrong claims about previous projects…the big boys in the boardroom are using them all to climb the corporate ladder, often at the company’s cost.
Top (C-level) executives, including board directors and vice presidents, were responsible for 42 per cent of all frauds committed, revealed a survey conducted by India operations of KPMG Forensic late last year.
Moreover, about 85 per cent of educational discrepancies were related to submitting fake certificates and 42 per cent of employment discrepancies were about inflating tenures.
Frauds in white-collar professions have increased by 54 per cent from 2006, revealed the India Fraud Survey Report 2008 by KPMG Forensic.
The study surveyed 250 companies and the problem seems to be spreading across industries. Restricted so far to the financial sector and infotech enables services, it has now spread to sectors like retail, real estate and insurance.
Everything including a passport, a mark sheet or even a salary slip is now being checked. Many former servicemen are playing the watchdog.
“Ex-defence personnel are now an integral part of this industry. Earlier, only background verification cells in regional passport offices used to hire the services of these companies,” said Pandia Rajan, managing director, Ma Foi Consultants.
Real estate is now the second most vulnerable to lying employees after financial services. “Considering the boom projected in the insurance and retail sectors, they are very susceptible,” said Rohit Mahajan, executive director, KPMG Forensic.
Reference :Aditya Ghosh & Soubhik Mitra, Hindustan Times
Lies are fast becoming the ladder for India’s corporate climbers. And India Inc is slipping.
Dishonesty ranged from inflating salaries and submitting fake certificates, including fudged university mark sheets.Three in every 10 job seekers fake it on their CVs to get a job, reveals at least three recent surveys conducted across the country between January 2007 and March 2008. Dishonesty ranged from inflating salaries and submitting fake certificates, including fudged university mark sheets.
Such lying is one of the reasons India Inc loses about $40 billion (Rs 1.72 lakh crore) annually through corporate frauds by company insiders, according to a survey conducted by India Forensic Research, a background check firm.
“We have seen in the past two years that people who lie on their CVs are more prone to committing larger frauds later,” said Ashish Dehade, managing director, west Asia operations, of First Advantage, a US-based multinational background check firm which surveyed 1.5 million cases in the last 15 months.
“Recently, six employees of a multinational bank committed a major credit card scam. It was found that all six had lied on their CVs about their employment record. In fact, all six had lied even to get into their previous jobs.”
Infotech giant Tata Consultancy Services does a thorough background check of all recruits within seven days of issuing offer letters.
“Information security is key to our industry. We cannot afford any compromise,” said K Ganesan, the company’s vice-president and global head, Talent Acquisition & Academic Interface Programme.
Conventionally restricted to infotech, information technology enabled services, banking and insurance, frauds have more than doubled in the last six months in fast moving consumer goods, retail, health care and travel industries.
One in every three employees in the banking finance, security and insurance (BFSI) sector, every fourth infotech employee and one in every six in the infotech enabled services sector were guilty of misrepresenting or faking education or employment records, revealed the First Advantage survey.
Most frauds were reported at the upper rungs of the ladder. Top (C-level) executives, including board directors and vice-presidents, were responsible for 42 per cent of all frauds committed, revealed a survey conducted by India operations of KPMG Forensic last year.
Complimenting people on their success or accomplishments is a sure way of generating positive feelings. Positive strokes lead to enhanced team spirit which automatically affects performance, says Dr EJ Sarma
In their attempt to get the best out of people employed, a management spends a lot of money and HR professionals try all the tricks up their sleeve to get the motivation levels up. They try climate, culture, rewards, compensation, choice assignments, and all seem to work sometimes but not all the time. If one is in a leadership or a managerial role, chances are that we are preoccupied with ourselves and have little time to think of motivating others. All of us who are in HR talk and read about motivation. The question however is: Can we really create conditions for people to motivate themselves?
In this article we examine those possibilities.
* Kindling positive thoughts: Most of us know what it feels to be down and under. The most common cause of work depression is negative feeling and consequent depression when one is faced with complete inability to bring information together to find solutions to problems. Psychologists refer to this phenomenon as convergent thinking, which is an ability to branch out from the start to search variety of ways of solving problems. Lateral thinking is able to flourish only if the work climate is conducive.
Energy levels flow only when there is atmosphere to kindle positive feelings through positive thoughts. Our simple likes and dislikes turn upside down in times of depression. The reactive depression that gets created most of the time in work places can be removed if only there is some one to handle it by positive stroking. Or even through some soothing words. The kind of pep session I referred to earlier in this article. Positive stroke leads to positive feeling, which in turn repeats positive behaviour. Complimenting people on their success or accomplishments is one sure way to get the positive feeling out. The HR support systems in reward scheme must provide for such positive stroking when the people you lead attain goals or project milestones.
* Happiness and enjoyment motivates: Research findings indicate that the success or failure of our relationships is directly related to how much we enjoy work. People value happiness not really in material terms, which corroborate the old song “the best things in life are free”. When asked, many do mention source of happiness as health, family life, friendship and work.
In another research some time ago, the people of Denmark were found to be the highest scoring on happiness index. Ironically Denmark also had the highest suicide rate. The happiest persons are those who can experience and form healthy relationships even at work. That is why the boss is a critical factor to motivation. Apart from satisfaction of doing very well on the job, gaining promotions and salary raises; the work provides a structure and purpose for each day in our life. Normally employees do not prefer to do monotonous work and hence it is not possible to expect everyone to enjoy what they do. Recently a bank manager wanted me to help him out with the decision of whether or not to go for VRS (voluntary retirement scheme). He was more concerned as to what he would do after VRS, even with all the money. His main concern was about his chances to get another job. Managers must learn to celebrate even small wins. Build in enjoyable social activities for everyone, such as having coffee or lunch together.
Some days ago I suggested the CEO of my client company (who was known for his managing by paranoid style), to have lunch in the staff lunchroom. He did, but it was so strange for him, that no one would talk. There was no genuineness in the attempt to share moments of happiness or joy.
* Feeling important motivates: Who does not need attention? The oft-heard comment in corporate cabins is, “I was not consulted”. Actually people don’t feel let down so much if HR processes can provide for structure to make very one feel important. We can listen more often and give respect to views of others and consider their thoughts carefully and give due credit when somebody’s idea bears fruit. The more I make someone feel important I have done the motivational trick.
* Success motivates: There is no better tonic than success. Most of us would like to discover our inner potential to the fullest, make the most of everything that we are capable of being and doing and live life to the fullest. The urge to reach the ultimate limit is innate in us. Man’s quest for self-actualisation and recent successes in every walk of life is concrete evidence to the humanistic theory of motivation of Maslow or Rogers. If manager sets clear reasonable goals within the group, makes certain that stakeholders get help, understand what the goals mean, and agree to them, then there is reasonable success probability. That is what we can do to contribute to others motivation. I would advocate nothing less than termination to those managers who fail to do on-time performance appraisal and feedback. There are plenty of those wolfs in goatskin around and cry about work place motivation or lack of it by managements.
* Personal benefits motivate: Nature usually sees to it that we are fully conscious of ourselves as distinct individuals. This self-consciousness continues to grow. If motivation has to work we better address this need. Though most work situations are team working situations, we must identify and state how group members can personally gain from an activity. Recently, the director of my client company wanted to give Rs 40,000 as reward to the CFO, for getting a cost saving through his personal effort to the tune of some $20,000. I was asked to suggest how this would be announced. My view was that we must tell the CEO that he singularly deserved the credit. And it is completely up to him to decide on the money. As I guessed, he decided to share it equally with his team members, at the same time felt proud, and got excited that his personal contribution was noted and appreciated. We not only got him motivated, but also got the entire team to feel a sense of achievement.
* Clarity motivates: We use emotional behaviour to communicate our needs and intentions to others and prompt those to give way to our demands. Positive emotions attract other people. The complexities are enhanced when we do not plan our messages, oral and written, and take time to ensure to communicate clearly. Confusion due to poor communication can be demotivating. Therefore, there is no way one will feel charged if the organisation is incapable of communication or the managers cannot ensure clarity.
We liberate ourselves from most drives by fulfilling them. Even organisms like bacteria are able to recognise their biological relatives and help their chances to survive and reproduce. Then why worry or complain about motivation, let us do our bit to take people to their heights.
Performing background checks are as important as other recruitment processes. E J Sarma gives some handy tips to ensure that you do not regret your recruitment decisions
Few months back I was offering consultation services for an IT organisation, which urgently wished to hire a person as ‘head of quality’. The reason? They wanted to acquire an ISO certification. After a lot of hunting we came across a candidate who seemed to have the right credentials. He had an MS degree from an unheard-of American college and claimed to have high profile experience. The interview followed. After a couple of rounds the candidate was offered a pay package of Rs 12 lakh. He walked away with the appointment letter and a confirmation to join after 15 days.
After the guy reported for work, believe it or not, I insisted on following the ‘reference check’ policy (which the company conveniently ignored), created by me for the company. The candidate was initially reluctant to let us know the names of persons with whom we could enquire. I thought of the next best thing to do—call up his current employer. I spoke to the managing director, and the moment I mentioned the name of the candidate, he asked us to call the local police and hand him over. The person had committed fraud on the Internet using the MD’s credit card number, which he had hacked. On checking further, with all his former employers, similar stories ensued. Our client escaped from a severe embarrassment.
Some years ago, the bank that I was working for, embarked on a quota filling exercise. Some 26 reserved category candidates were selected as the bank was under pressure to fill up the long overdue quota. When I was going through the qualification of one candidate, I was shocked to find that the university from, which he claimed to have passed out, was non-existent. Somehow, the IT industry in general and HR professionals in IT have over the years ignored the time tested method of control. My guess is that almost all organisations claim to perform some sort of checks on potential employees, yet we continually hear about bogus directors or fraudulent CEOs. Performing effective background checks not only highlights the importance of screening the applicants thoroughly, but also provides you with handy tips to ensure you don’t regret your recruitment decisions.
First warning signal
According to industry experts, 30% of résumés contain misappropriation of facts. The most common thing is to hide gaps in employment or to expand the dates of employment, but sometimes the issues can be more serious. For example, when candidates had played little part in the implementation of the previously mentioned projects; or age is understated by two to three years by hiding gaps in studies. A few simple checks would have revealed these inconsistencies, but in the process of hasty recruitment, organisations pay the ultimate price for ignoring the same. And, it is somewhat scary to say that, this is not an isolated case of its kind as many of them go undetected or even unreported.
The best solution is to hire a professional agency to perform these checks; it is not always a financially viable option but checks must be performed. Failure to do so may have far more serious consequences than merely appointing some junior HR executive lacking the relevant work experience. The biggest risk faced by employers is that they can be held liable for “negligent hiring”, if the fraudulent candidate uses the position to commit inappropriate acts. Similarly, the increasing number of lawsuits in this area leaves us mindful of the need to respect employee privacy. With all these potential minefields in the area of recruitment, here are some tips and guidelines when performing a background check to ensure you don’t fall prey to wolfs masquerading in sheepskin.
Tell each applicant that employment offer will be withdrawn if satisfactory reference is not forthcoming: As in most areas of life, it is behaviour and not words and intentions that make impressions. If you are not planning to do referencing then do not ask for two references as it happens normally. Employees will quickly know whether you have carried out the reference checks. If no background checking is performed, the organisation loses credibility.
It may be worthwhile to ask the candidate to sign an undertaking allowing you to investigate all the information submitted on a job application.
If relevant to the job, you may want to investigate the applicant’s credit record with his credit card company or the bank. This will make it easier to gain information from former employers, as they will be aware that their ex employee has authorised disclosure to you.
Call or write to each reference given
Calling is the most common method as it tends to be faster, less time-consuming and more revealing (people will sometimes tell you all that they do not want to put in writing). Here are some tips for successful over-the-phone reference checks:
- Call first and schedule the reference check and then call back as promised. This gives the person time to remember specific facts about the person or enable looking up of employee records.
- Be sure to make the call check confidential.
- Sum up the conversation at the end, and be sure to thank the person for furnishing information and sparing their time.
- If asked for, offer to fax the job applicant’s undertaking to release information. This is particularly necessary when you are hiring in USA, UK or Europe.
Document all the information that you receive. Keep records of why an applicant was or was not hired. For example, when deciding against hiring an applicant for overseas assignment, your documentation should read “Unwilling to work in countries other than USA.” rather than “were not flexible” or “strong preferences”. If you are hiring in USA it is necessary to be sure to document unsuccessful tries at gathering information to protect yourself from negligent hiring claims. Maintain all documentation with interview notes and reasons for non-selection for at least one year.
Which references to ask for, why and how?
- Employer references: Former employers or bosses are in the best position to talk about an applicant. Most employers may play safe to give out factual information about former employees but many are willing to answer questions such as “would you rehire the candidate?” Even if you do not get all information, the least one could be able to verify is that the individual actually did work for the company during the times indicated on the résumé.
- Academic references: Applicants are even more likely to falsify information about their academic backgrounds than about their work history, probably because employers are less likely to check with schools for verification.
- Personal references: These are generally not very helpful, as they are often close friends or relatives of the candidate.
- Checking credit reports: Only necessary if your candidate will be responsible for finances. Banks or credit card companies here in India normally do no disclose.
- Checking driving records: If the position requires driving a company vehicle. This check will not only give you information about the applicant’s driving record, but you can also use it to further verify the applicant’s identity.
- Checking criminal, conviction and arrest records: With modernisation of police records, in case of doubt or doubtful recruitments, this needs to be done.
Performing background checks are as important as other recruitment processes. But they are the best tools to save not only money but most importantly embarrassments. More often than not, prevention is far less costly than the cure.
(Dr E J Sarma is CEO, NetSysCon)
Organisations find it difficult to make error-free judgements while identifying people for senior positions. DR E J SARMA writes that assessment centres are very effective in such decision-making processes
Let me share with you a funny incident. Recently, a client approached us with an urgent requirement for a particular software skill. We referred three candidates after proper screening. One candidate was put through three rounds of interview. The whole process took almost 15 days after which he was told that he will be put on 15 days trial. The candidate naturally got upset and told the company HR person to get lost. His contention was that even after three rounds of interview if the company management could not make up their mind, they were not worth joining. The company is yet to find a suitable person and they might have lost the project also.
If we analyse the reason behind this indecision we will know that judgements not based on data and facts are difficult. So the question is: Are there any better tools or processes?
Most companies find it difficult to make error-free decisions when it comes to identifying people for senior jobs, or when they want to promote. HR’s challenge is to help managements make the right decisions. The assessment centre concept is very powerful for such decision-making. In this article we will examine some critical issues related with assessment centres.
An assessment centre will have a standardised process for evaluation of behaviour using multiple inputs. These centres need well-trained process observers and robust techniques are used. Compared to normal interviews, at assessment centres judgements about behaviours are made by not one but many, using specifically developed simulations. Data is pooled by the assessors or by a statistical integration process. Trained assessors observe and evaluate candidates on their relevant managerial qualities, while those candidates are performing a variety of situational exercises. Assessment centre exercises (e.g., role-play, in-basket, fact-finding and group discussions), intend to measure dimensions such as leadership, planning, sensitivity, problem solving, and many others.
Assessment centres serve three main human resources functions:
- Selection and promotion
- Diagnosis (e.g., identification of training and development needs)
- Development (i.e., skill enhancement through simulations).
The following dimensions are normally assessed in assessment centres:
- Planning and organising
- Leadership n Analytical
- Problem solving
- Management control and delegating.
For success of the centres, assessors have to demonstrate the capability to observe and record the behaviour of candidates. This is demanding as assessors have to understand the difference between merely looking for concrete verbal and non-verbal behaviours and interpreting these behaviours. They should be able to withhold early judgements. These days video is frequently used to aid assessors in gathering behavioural information.
Assessors should be able to organise their behavioural observations by job-related dimensions. This means indicating to which dimension each behaviour belongs. Another skill involves accurate rating of candidates on dimensions. They should have the ability not to make comparative judgements. This is critical.
Assessors should demonstrate the ability to integrate information from various exercises and be able to discuss the ratings with fellow assessors. Finally, they have to write formal reports and give feedback.
Studies reveal that if assessment techniques are robust, targeted, well-designed and properly implemented, then grouped together this multiple assessment technique can be the most valid and reliable approach when compared to single-method approaches—such as interviews and personality questionnaires.
Although setting up an assessment centre can be costly, the cost is worth it if one considers the risk minimisation of recruiting the wrong person. Costs can be higher when organisations spend money in buying expensive off-the-shelf tools which tie them into an additional cost. Often these products are mis-aligned with competency models. Another cost is the time commitment required from internal participants and managers who play assessor roles.
The main advantage of assessment centres is that it allows key job success behaviours to be directly observed and measured. Designed and run properly, they provide a window to cross-check or challenge information gained through self report measures such as interviews. For example, someone may outline a ton of experience (e.g. leadership experience) in a behavioural interview, but in a group exercise they are observed to dominate, do not listen to others and ignore the quieter group members. Assessment centres are powerful and are becoming increasingly popular. Organi-sations which have growth plans coupled with the desire to get people to man positions from within, should get started on assessment centres.
Dr. E. J Sarma is CEO, NetSysCon