Right skilling addresses talent crunch’

You should have an open mindset and if you recognise the need to globalise and accept people from different cultures you are okay.
It’s a weekend but there is no let-up for the indefatigable Director, Human Resources of software major Infosys Technologies Ltd, T.V. Mohandas Pai. Just back from a long trip to the US, Pai is soon after in Chennai to speak at an event organised by this newspaper. It’s a few days before the company’s results for the last quarter of ’07 are to be announced, so Pai is wary of giving away anything pertaining to its business plans saying it’s the quiet period. But ask him about the software industry’s main asset, brainpower, and Pai is at his loquacious best. The New Manager interviewed Pai in the car from the airport to glean his views on a variety of issues that confront Infosys and the industry. Excerpts:
How do you react to the charge by other industries that software is sucking up lots of talent; that students from other disciplines are all heading to software.
It’s true that the IT industry is attracting a lot of good talent, it’s also true that other industries are feeling constrained. It has to do with the culture of Indian industry where for very long they had access to very good people paying very low wages. I remember several years ago, engineers used to get Rs 6,000-7,000. CAs used to get less than a lakh a year and now they get Rs 10 lakh. So, it’s a sea change, which means that talent is getting priced right and you have to compete for it. So each industry has to work on its employee brand and come out with a set of attributes that will attract people and industry has to work with academia to have backward linkages and make sure you put your capabilities in front of potential employees and compete for talent. I think it’s a good thing for the middle-class and a good thing for India.
So, you think employers from other industries complaining about the great software suck-up of talent is unwarranted?
It’s not fair to say it’s unwarranted. But society exists for individual members and not for management of companies; society as a whole is made of individuals like you and me and our interests are paramount to society’s so if someone complains then it’s the wrong thing to do because it will only prove that they are not popular employees. But, yes, as a society we should all accept that we should have adequate talent and enable industry to grow as everything cannot be IT and indeed IT is not the solution to India’s challenges; it’s a small part of the solution. But we need to understand the dynamics of the labour market and come out with appropriate strategies.
For example, the construction industry for very long has not invested in civil engineering in academia. Today, they are paying more money than the IT industry to get good talent; it’s a good thing but beneath all that there is one thing all of us need to do — that is right skilling. For too long Indian industry has had overqualified people doing under skilled jobs.
Now the only solution for India, including IT, is to do right skilling to find out the attributes of job needs and match that with the skills required and find the right kind of people for jobs.
For example, in our BPO industry we had high attrition and our HR head came up with an idea – she said we would find people who were happy doing the job, who were contented and we went to the smaller towns and found a different class of people who were happy doing that job. They have a different view of life and so are their aspirations. You go to an urban, middle-class young man who has passed out of a top city college, his aspirations are totally different. Right skilling is the way out and if we sit down and do that, then there is enough talent for everybody.
The rapid growth of the IT industry has seen younger people assume huge responsibilities and roles…
We have been pushing young people one or two rungs up but this could have its repercussions because if you push young people up too fast they could falter somewhere up the line. It takes time to handle people, to develop managerial skills and if you push them up too fast, they find that they don’t fit and burn out. I’ve seen it happen in the IT industry, because not everybody who is pushed up fast makes it to the top. People need time to grow. In earlier generations, there was stability. Once you promote people every two years, give them more responsibility, stress levels also go up; not everybody has the capability and not everyone can grow at the same pace.
With the recession in the US, what are the overall indications for IT hiring for the year?
It is part of the global industry which sees up and downs. If things are growing well in the West, which is our major market, then you will see higher growth. But if things don’t go well, they want to cut costs and come to us to outsource more work. So, the Indian IT industry is fairly well positioned but how long will there be a gap between the global economy cooling down and more outsourcing work coming to India – that’s the challenge.
You employ 89,000 people across 23 countries, 60 nationalities, how do you manage this diversity?
We have a distributed leadership model and we try to create a common value system across the enterprise. We are also trying to create a common culture. But it’s going to be very difficult to have a common culture that binds the organisation across geographies and at the same time have a culture that is unique to the location where we are situated, because in every location we need to have local talent coming to us. Right now, the Indian IT industry is configured with a large percentage from India and very small numbers from other nationalities, but that should change. It’s because India has a huge reservoir of talent unlike other countries but nevertheless as we penetrate markets further afield we create local development centres and try and get in local leadership and create a HR framework that suits the local environment. So, globalisation has its challenges for management.
So, how many people from other nationalities do you employ today?
We have about 3.5 per cent today and we hope to grow that percentage faster than the growth in the other 96.5 per cent.
Do you have problems of cultural adjustment?
Yes, there are challenges, because, remember all policies and everything that you do, is subconsciously determined by the people who design the policies; there are so many local nuances, local needs and everybody is learning. You should have an open mindset and if you recognise the need to globalise and accept people from different cultures you are okay.
How are you developing the second rung from your Mysore leadership institute?
We have been successful in creating a second rung of leaders. We have a newly created executive council where four senior people — members of the board — are part of this council. These people are taking additional responsibilities and then we have a unit head who is part of this council; we have used this framework to invest in people and develop this capability; it’s been fairly successful. Has it been a total success? We have to still write the full story.
In IT, leaders identify themselves. We give them more responsibilities and this is not a deliberate act like in other companies, it comes naturally. The industry is young and everybody is a fast tracker. But it has its own repercussions, many people burn out, many leave, there is attrition, much more so than in other industries, and there are people who just cannot take it any more.
What’s the next bastion for the industry?
In the top ten in the world today you could have three Indian companies, perhaps not in revenue terms but in terms of people or consultants; because of our model we get less revenues per person than companies overseas. In the next two years, we should get at least 2-3 players in the top five. And on the business side, the challenge is to build up our end-to-end business services and become trusted advisors. We have the technology and domain expertise, we need to scale it up and expand it dramatically, that’s the big challenge. We need to get more overseas people in the top management, reconfigure the way we run our business.
What about recruitment this year, given the impending recession coming on in the US?
We had said last quarter that we were in line for the hiring for the quarter and now ’08 is over. And, for ’09, we have 18,000 offers already in the market.
If the slowdowns continues, analysts say that the lateral-to-fresher hiring ratio will change as clients may no longer want a low-end service?
We need to understand that the market is constrained by the availability of laterals. Barring application development maintenance there is a shortage of laterals in other areas. Most corporations aspire to go up the value chain for which they have to be more domain intensive, more tech intensive and need more experienced people. It’s not coding work, which means that you should have an appropriate ratio of laterals to freshers. Right now we are at a ratio of 34:66. But when you hire a fresher you are building future capacity, 16 weeks of training, it takes 9-12 months for them to be billable and since attrition levels are higher at this level you need to hire more of them. We find many leaving to do MBA and M.Tech programmes. Companies that have invested in training will be the ones that will be successful.