Changes in HR management in the new business environment American Chamber of Commerce - PowerPoint PPT Presentation

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Changes in HR management in the new business environment American Chamber of Commerce

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  1. Changes in HR management in the new business environmentAmerican Chamber of Commerce Ekaterina Ukhova 17 March 2009

  2. Current economic environment in Russia • Gross domestic product: • – 2.2% decrease - forecast of the Ministry of Economic Development and Trade for 2009 • Inflation rate: • - 14% (the initial forecast 13%)* decrease (official forecast for 2009) • Slowdown in production: • -7,4%* decrease (evolution of forecast -3,2%, -5,7%) • Investment capital: • -14%* decrease (evolution of forecast +1,4%, -1,7%) • Unemployment: • up to 10 million people - forecast of Social Policy Center, Institute of the Russian Academy of Sciences * forecast of Ministry of Economic Development and Trade

  3. Ernst & Young compensation & benefits survey – February 2009 100 companies • 25% with annual sales volume over USD 1 billion • 17% with headcount over 5 000 employees in Russia Characteristics of the participants

  4. Cost cutting policy 54%of respondents are planning to cut personnel related costs in 2009

  5. HR areas subject to cost cutting • Training • 45% of companies have reduced training budget in 2008 • 64% of companies plan to reduce training budget in 2009 • Business travel policy • 54% of companies plan to reduce per diems, change class of hotels and flights in 2009 • Corporate events • 73% of companies plan to cut corporate events cost in 2009 • Staff promotion policy • 22% of companies plan to revise the promotion policy in 2009 • Remuneration policy • Bonus policy • Benefits policy • Headcount optimization

  6. Currency regulations in salary arrangements • NONE of the respondents plan to switch to a foreign currency • NONE of the respondents plan to compensate employees for the exchange rate related loss of salary’s purchasing power

  7. Remuneration policy Over 40% of respondents either have not made a decision whether to review the base salary or do not plan to review the base salary in 2009 Plans for 2009 as of February 2009 (% of respondents)

  8. Production personnel: relative base pay levelsin February 2009 (market median)

  9. Bonus policy 31%of respondents plan to review bonus policy in 2009 Actual bonus size dynamics

  10. Optimization of employees’ benefits packages • 17% plan to review medical insurance policy • out of which 37% plan to change annual medical insurance contribution • 10% plan to review corporate car policy • 20% plan to review corporate mobile phone policy Changes in benefits policy will also affect: • Sponsored meals • Sponsored sport activities • Sponsored vacations / sanatorium - resort therapy • Additional insurance

  11. Headcount optimization Popular measures of headcount optimization: • Formal headcount / staff reduction • Paid / partly paid vacation • Unpaid vacation • Shortened workday / week 31% have reduced / are planning to reduce HR staff in 2009

  12. Please address your questions on HR management to ourHuman Capital team: +7 495 755 9675 Zhanna.Dobritskaya@ru.ey.com +7 495 641 2932 Ekaterina.Ukhova@ru.ey.com