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Macro Logistics

The rise of the backroom boys

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Lead courier Stanley Paul Fernandes (l) with his team at DHL Express India's sorting hub at Byculla, Mumbai

Image Credit: Bandeep Singh

How DHL and Blue Dart became great employers in a difficult industry.

A few years ago, logistics company DHL Express India (DHL) received an urgent consignment from Hindustan Unilever (HUL). The consumer goods giant is a prize catch any day. Back then, its account was with a rival, which made this particular delivery an even bigger deal for DHL.

Stanley Paul Fernandes, lead courier, was one of those entrusted with handling the consignment. He recalls how the entire team came together on a war footing. “After that delivery, all of HUL’s domestic business came to us,” says Fernandes, who joined the company 27 years ago and has risen from being a delivery boy to managing a delivery team to becoming a sort of mascot for DHL as an employer.

“The training and exposure you get in this company make you a stronger person,” he says when I ask him to explain his fealty to his employer, which is the Indian division of the world’s largest logistics firm, headquartered in Bonn, Germany, with over 280,000 employees. “I used to be mortified of public speaking, but now I can comfortably address a gathering. I even do some anchoring at parties and weddings in my spare time,” he tells me.

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Loaders from Blue Dart Aviation, a part of Blue Dart Express, at the Bengaluru international aiport

Fernandes is not the only one to have spent a lifetime at the company. Sunjoy Dhaawan, vice president, human resources, DHL Express India, says that’s the norm. “Recently, an employee who had joined on day one retired after 32 years with us,” Dhaawan says. “The average tenure of people here is 10 years, and our attrition rate has hovered around 6% for the past five years. The industry average is 13% to 14%,” he claims.

To fully understand the import of that, consider that the logistics industry globally is going through a crippling talent crisis (see graphic ‘Talent Shortage in Logistics’ on page 56): A report commissioned by DHL cites industry research that says demand for professionals exceeds supply by a ratio of 6 to 1.

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Statistics wrapped up, Dhaawan invites me to watch the annual in-house “happy video”, starring him along with the rest of the top management and DHL staff from across the country shaking a leg to the “Happy Theme of the Year”. “There’s no reason for work to be so serious,” he quips. “After all, we are not in molecular biology!”  

One hardly imagines the logistics industry, which enjoys the brutish reputation of being all about lifting and lugging unwieldy objects for customers who are impossible to please, as a place where work can be song and dance. India reportedly spends 14% of its GDP on logistics and the industry is expected to touch $385 billon (Rs 24.3 lakh crore) this year, but it is difficult to think of a trade that is more obscure in the public mind.

In an interview for a Fortune story last year, George Prest, CEO of logistics trade group Material Handling Industry (MHI), summed up the industry’s problem thus: “When you order something from, say, Amazon, you know it arrives on your doorstep in two days, but most people don’t think about how.” Prest added that the obscurity repels fresh talent, “who think of supply-chain work—if they think of it at all—as ‘a guy driving a forklift in a dusty old factory’.

That’s what makes the 2015 Aon Hewitt Best Employer survey results interesting: The top 10 include not one but two logistics firms, DHL and Blue Dart Express. (The only other industry to have two companies in the top 10 is hospitality.)

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Logistics companies need to make a conscious effort to ensure there’s no wall between the management and the ground staff.

“Let’s face it: Logistics is a very unglamorous sector and is known to pay badly,” says Nishchae Suri, partner and head of people and change practice at consultancy KPMG (India). Suri says the only reason people stick around is the bond an employer manages to develop with the employees over the years. “How much care and attention they get and how pleasant their everyday routine is determines their longevity in a company,” he says. “Like in any other industry, lip service isn’t enough.” 

So, what makes a great workplace? A funky office, free food, great pay, and unlimited growth, if you believe the popular narrative. But experts look for other things. “Staff engagement, effective leadership, high-performance work culture, and a strong employer brand are the four pillars that make a workplace click,” says Sushil Bhasin, director and marketing head, Aon Hewitt Consulting.

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Mention this to Dhaawan, and he’d likely shrug it off as jargon. He divides his HR philosophy in three columns and calls them Laxmi, Saraswati, and Durga after the Hindu goddesses of wealth, knowledge, and power. First, he says, DHL conducts industry surveys to make sure that it pays its people above market rate. Once in, employees are put through continuous learning and skill-enhancement programmes. Every DHL employee owns a passport to success. It is literally a red passport complete with employee details and pages ready to be stamped. Employees earn stamps as they cross various levels of training. All senior executives undergo this exercise and then train those reporting to them.

Unfortunately, learning and development can degenerate into mere window dressing in even the most well-intentioned companies. Dhaawan agrees. “Ultimately, people are more loyal to their own career than to an organisation [no matter how much it invests in training them],” he says. “They would stay only if they don’t feel stagnant and are allowed to grow freely within the organisation.” DHL’s industry report quotes Ken Cottrill of the MIT Center for Logistics and Support saying job rotation through different departments and functions is a great policy, as it enriches skills and gives employees a broader perspective of the business. The company tries to follow this principle whenever possible. Take Syrus Palsetia, DHL’s head of compensation and benefits, who has spent the last 10 years in HR after substantial stints in finance, administration, and procurement. “I was doing something new all the time, so the thought of leaving never occurred,” says Palsetia.    

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There’s also Radhika Vivek, customer care head, who started her career 19 years ago as an HR co-ordinator. Vivek is also a winner of the company’s Employee of the Year award, a red-carpet gala where the company spends as much as Rs 5 lakh on each winner. “The entire global management team stands up to applaud you as you walk up to collect your award,” Vivek says. “They do up your hair, put up posters—it’s like a dream.”

To further enhance aspiration value, DHL launched the Arabian Dream programme in January, through which frontline team members can apply for a posting in the company’s Middle East operations, with the assurance that their jobs will be secure when they come back to India. Five employees have already made the cut.
 
For Anil Khanna, Blue Dart’s managing director, the key to happy employees is keeping their families at the centre of policy making. Connery D’Souza, Blue Dart’s head of operations, vouches for that. “I interviewed here at the age of 18. I needed the job due to a crisis at home. And the first thing my manager told me after I joined was, ‘Let’s get you paid something, we will talk about work later,’” he recounts. D’Souza has spent 24 years with the company and believes that the sense of belonging is the biggest draw here. “The office feels like an extension of me,” he says.

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Anil Khanna, MD, Blue Dart Express, says the cornerstone of good HR management is keeping the employees’ families at the centre of decision making.

During the 2008-09 recession, Blue Dart decided to not hand out a single pink slip, even though it was sitting on 900 excess hands. Ajit Nair, who heads IT, says it wasn’t a tough decision for the management. “During the Mumbai floods on July 26, 2005, when most networks were down, our IT team stayed back in the office and kept things running.” On his way home, Nair saw a Blue Dart employee carrying a delivery bag on his head wading through waist-high water. “I asked him what he was doing. He casually said he had deliveries to make.”

The company is particularly sensitive about avoiding any kind of wall between the management cadre and those involved with the hard manual labour that’s the backbone of the business. When deliveries peaked last Diwali, senior executives were out of their cabins monitoring loading and unloading with the ground staff. All branch managers volunteered to deliver packages in their own cars to manage the rush.

Balfour Manuel, senior vice president and regional head at Blue Dart, shares a story. “I was told to get the Union Carbide account way back when we had just started and were a seven-people company,” he says. “I pulled strings and somehow managed to get them to give us some business—and at the counter taking bookings was my boss. He winked at me to suggest I go with the flow.” Since then, says Manuel, a culture of openness and teamwork has preceded everything else in the company.

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Sunjoy Dhaawan, vice president, HR, DHL Express India, says there’s no need for work to be so serious. “After all, we are not in molecular biology!”

Given how difficult it can be to communicate this culture to newcomers, Blue Dart tends to look inwards first to fill vacancies (as does DHL). “I was involved in a career accident,” says Barttanu Das, senior vice president, human resources. Das left Blue Dart for a period of six months to join a manufacturing company. Soon, the new promoters went back on most of their promises. By this time, a new candidate had almost been selected to take over Das’s role at Blue Dart. But Khanna did an internal survey to find out who the team wanted more, and Das was brought back.
  
The best HR policies will be of little use unless the industry is able to find enough people committed to building a career in it. Hariharan Muthukrishnan, automotive head, DHL Global Forwarding, India, laments in the industry report that few people start out pursuing a career in supply chain. “Most want jobs in manufacturing, for instance, but end up in logistics as a fallback. This is starting to change, but progress is slow. As a result, we have a very limited number of people who are highly qualified in supply chain,” Muthukrishnan says.