The Employee Is Always Right

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He has branded his management philosophy "Employees first, customers second"—even when talking to customers. And lately, he has even been saying he wants to "destroy the office of the CEO." While he has no actual intention of doing that, he says it to remind employees that they should not look to him for all the answers.

In addition to the shared 360 ratings, Nayar has other tools that force the company to respond quickly to employee concerns. On HCL's intranet, Nayar publicly posts responses to every question left by HCLites, as they call themselves. He spends about seven hours answering the 50 or so questions he gets each week, often on Sunday mornings at home.

On Nayar's watch, HCL has developed a one-stop online "smart service desk," where workers file complaints (or "tickets," in IT outsourcing lingo) about any issue, whether it's the freezing air conditioning in their office or something as thorny as the size of their bonus. Everyone uses it, from the most junior programmer to senior officers who might get white-glove service elsewhere. Shipra Gill, 23, an assistant marketing manager, says some of her colleagues opened tickets to complain after a new cafeteria vendor didn't carry popular brands of chips and beverages. And unlike the tech-help desks that most cubicle dwellers endure, Nayar added a twist that underscores his philosophy: Only workers can close the tickets, once they feel the issue has been resolved.

Even though HCL employees were the primary beneficiaries of Nayar's innovations, some were initially skeptical. "People did not really believe that this program would make a difference," says 27-year-old Anisha Khanna. Just 10% of the engineers in her department showed up at Nayar's early speeches. Others worried how it would look if they got negative ratings by their underlings. (All employees who take time to rate managers above them can get access to their scores.) But workers learned to trust the system, in large part because Nayar makes it clear the feedback isn't used to determine bonuses or promotions. Enough employees have gotten comfortable with the public feedback that HCL expanded it for 2007. Now workers can see results not only of their managers, but also of peers they rate.

None of the companies that have studied HCL's systems has adopted its public feedback program so far. "It's too radical for most of them," says Nayar. But that doesn't stop him from thinking his ideas will spread. "I believe this whole concept [of making management more accountable to workers] is going to get accepted as a way of life ... Talent is only becoming scarcer and scarcer."

With Manjeet Kripalani in New Delhi