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Indian IT-BPO Industry: Building Future
Ready OrganizationsChennai, 28-29 July 2010
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Key Topics
Past Decade Significant Impact
HRs four levers to build Future Ready Organizations
Sustained Investment in Training
Opportunities for Career Growth
Managing People Challenges effectively
Ensuring Cost Competitiveness
NASSCOM Initiatives
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6X increase in direct employment;3Xincrease in the share of organized private sector
4 3 0
2 ,3 0 2 ,5 0
F Y 0 F Y 1 F Y 1 1
D i r e c t e m p l o y e e s ( ' 0 0 0 )
45%of total incremental urbanemployment in thelast decade
~6x
By 2020 - Direct employment of 10 million; Indirectemployment of 20 million
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Employment opportunities for diversesections of the society
Livelihood for Economicallybackward
Empowering theyouth
Bridging thegender divide
EmploymentbeyondUrban areas
Employing theDifferently abled
~5% of the IT-BPO workforce fromeconomically backward sections
~5% of the IT-BPO workforce fromeconomically backward sections
Industry average age-27
Industry average age-27
~37% women employees in FY09; account for 45% of fresher intake~26% of the female employees are chief wageearners
~37% women employees in FY09; account for 45% of fresher intake~26% of the female employees are chief wageearners
~58% of the IT-BPO workforce is from tier 2/3 cities
~ 56% employees are chief bread earners
~58% of the IT-BPO workforce is from tier
2/3 cities~ 56% employees are chief bread earners
~60% of companies provide employment todifferently abled people
~60% of companies provide employment todifferently abled people
Young demographics
Changing aspirations of Indias youth
Created high paying jobs
Setting new standards of work environment
By 20205 mn women
employees
*NASSCOM Evalueserve survey findings, 7500 participants pan India
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Leading transformation in Tier 1 cities;extending impact to Tier 2/3 locations
By 2020: 4.1 mn incremental direct jobs in tier 1 locations; 3.8 mnincremental direct jobs in tier 2/3 locations
Direct employment - 1.9 million Indirect employment - 7.3 million
~ 2X growth in FY05-09 in engineeringcolleges and technical graduates
58% of the total engineeringcolleges
62% of the total intake of technical graduates
Direct employment- 1.7 lakh Direct dependents supported- 4X
1.7X growth in FY05-09 inengineering colleges andtechnical graduates
Number of engineeringcolleges- 985
Number of technicalgraduates - 508,000 Skill Development trainings
in tier 2/3 locations
TIER 1 TIER 2/3
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Morocco
SpainUSA
MexicoGuatemala
Building a global workforce(nos) 2007 2008 2009
Countries of Operations ~48 ~52 ~60
Operating Centers 340 ~400 ~460
Poland
FinlandGermanyHungaryNetherlandsRomaniaSweden
South Africa
Philippines
2.2 million employees;~60 countries35+ Languages; 5% Foreign Nationals
IT-BPO Exports revenue by Geography, FY2010
Australia
Russia
Sri Lanka
France
Italy
Canada
China
New Zealand
Brazil Tanzania
Taiwan
UK & Ireland
Egypt S. Arabia
Japan
Argentina
* Illustrative list of countries represented above
India
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NASSCOM TOP 20 IT-BPOEMPLOYERS in INDIA FY09-10
7
Rank Company1. Tata Consultancy Services
2. Infosys Technologies Ltd
3. Wipro Ltd
4. Cognizant Technology SolutionsIndia Pvt Ltd
5. HCL Technologies Ltd
6. Genpact Limited
7. MphasiS Ltd
8. Intelenet Global Services Ltd*
9. Tech Mahindra Ltd
10. Aegis Ltd
Rank Company
11. Capgemini Consulting India Pvt Ltd.
12. WNS Global Services (P) Ltd*
13. Firstsource Solutions Ltd*14. CSC India Pvt Ltd
15. 3i Infotech Ltd
16. Hinduja Global Solutions Ltd*
17. L&T Infotech
18. Patni Computer Systems Ltd19. Exl Service.com (India) Pvt Ltd*
20. Aditya Birla Minacs Worldwide Ltd*
Note:
This list is basedontheIndia-basedFTEheadcount of firms withIT-BPOoperations inIndia, as reportedtoNASSCOMinits annual survey.Basedonpublicly availableinformation, fewother MNC's suchas Accenture, Convergys, HPIndiaandIBMwouldhavealsofeaturedinthis list. However, as they havenot
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Industry in the process of buildinghigh energy workforce focused on future aspirations
Tier 1 focus in India Tier II and rural opportunities
Largely domestic workforce Multicultural workforce, 15-20% foreignorigin
Indian policies and processes Global policies and processes
Delivery-centric management withlimited career focus
Multiple, specialized domain expertise
Generalist skill set Domain-specific business knowledge
Talent pool focused on delivery Talent pool with value add capabilitythrough innovation, analytics, ER&D
Future Decade
Tier I delivery focus in India Tier 2/3 and rural opportunities
Past decade
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Key Topics
Past Decade Employment Facts and Impact
HRs four levers to build Future Ready Organizations
Sustained Investment in Training
Opportunities for Career Growth Managing People Challenges effectively
Ensuring Cost Competitiveness
NASSCOM Initiatives
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Industry supplementing theEducation system
Spend of USD 1.4 Billionon training activities inFY09
5% of total annualemployee time spent on
trainingAverage trainingperiod for new employees 14-16 weeks
Average training period for existing employees 2weeks
45% of training spend onnew employees- USD 630Million
Average amount spend ontraining new employees=USD 4350- 40% of cost of an average engineeringcourse
Spend of USD 1.4 Billionon training activities inFY09
5% of total annualemployee time spent ontrainingAverage trainingperiod for new employees
14-16 weeks
Average training period for existing employees 2weeks
45% of training spend on
new employees- USD 630Million
Average amount spend ontraining new employees=USD 4350- 40% of cost of an average engineeringcourse
Break-up of Human Capital Management costs
* Other Costs include training for existing employees, employee welfare, salaries for trainingstaff, training material costs
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EmploymentGeneration -
Urban andRural
Language,Process, S&M
skills,Research &
Analytics
Process andVertical
specialists
Emerging as a Skill Factory Introducing/upgrading new skills
Industry
Ready
Future
Ready
Domain skills across sectors:BFSI, Healthcare, Retail,Telecom, Consulting (IFRS),etc.
Customer facing skills: Clientinteraction, sales & marketing,customer service, voice/accenttraining, etc
Domain skills across sectors:BFSI, Healthcare, Retail,Telecom, Consulting (IFRS),etc.
Customer facing skills: Clientinteraction, sales & marketing,customer service, voice/accenttraining, etc
Domain skills across sectors:BFSI, Healthcare, Retail,Telecom, etc.
Cross-platform skills: SAP,Oracle, Java
Technical skills: Mainframe,Dot net, J2EE, Open Systems,etc
Domain skills across sectors:BFSI, Healthcare, Retail,Telecom, etc.
Cross-platform skills: SAP,Oracle, Java
Technical skills: Mainframe,Dot net, J2EE, Open Systems,etc
Domain skills across sectors:Aerospace, Automobiles,Energy, Telecom, etc
Services: Plant engineering,Sustainability/Green, Energy,Infrastructure engineering, etc
Domain skills across sectors:Aerospace, Automobiles,Energy, Telecom, etc
Services: Plant engineering,Sustainability/Green, Energy,Infrastructure engineering, etc
IT ServicesIT Services BPOBPO ER&DER&D
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Industry investing in vibrant career growth; retooling employee skill sets
MULTI SKILLING
DEFINEDCAREER PATH
Competency Frameworks
Expertise across end to endindustry value chains through
job rotations
Funding/reimbursement of further education; certificationprograms
Cross skilling/multi-skilling/up-skilling across technology /platforms / services
Competency Frameworks
Expertise across end to endindustry value chains through
job rotations
Funding/reimbursement of further education; certificationprograms
Cross skilling/multi-skilling/up-skilling across technology /platforms / services
Career Architecture maps
Internal job rotations
Continuous improvementprojects
Best practice sharing
Career Architecture maps
Internal job rotations
Continuous improvementprojects
Best practice sharing
GLOBALEXPOSURE
Cross cultural integrationand Best practice sharing
Joint training programs
Cross polarization of projectteams
Global compliance group for
global integration
Cross cultural integrationand Best practice sharing
Joint training programs
Cross polarization of projectteams
Global compliance group for
global integration
BUILDINGLEADERSHIPPOOLS
Strong domain leadershipprograms to understandcore business functions
Ops, Finance, IT, HR,
Commercial LeadershipRigorous career andsuccession planningprocess
Global Leadership Cadreprogram; shadow boarding;accelerated career pathprogram
Strong domain leadershipprograms to understandcore business functions
Ops, Finance, IT, HR,
Commercial LeadershipRigorous career andsuccession planningprocess
Global Leadership Cadreprogram; shadow boarding;accelerated career pathprogram
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Industry taking significant measuresto manage challenges effectively
Monetary benefits : Retention bonus, rewarding meritocracy, ESOPs
Non-monetary benefits : Continuous skill development; innovation culture; accelerated
growth track, job rotation
Build/expand capacity to lead cross-functional initiatives and projects
Succession planning process
Employeeretention
Pre hire orientation, Buddy program, Rigorous One-on-One, Family Connect
program, Townhall, Attrition tracker Significant employee engagement - Rewards & Recognition, effective communication(company newsletters, social media, internal blogs), CSR
Industry consistently features high in work/employee satisfaction surveys
High Attritionlevels
Attractingright talent
Leadershippipeline;trained middlemanagement
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Annual Incremental engineering fresher addition, 000, FY01-09
Cumulative fresher addition (FY01-09)
IT- 684,000
HR pivotal in maintaining Industryscost competitiveness
Hiring Fresher's
Average Fresher
to lateral ratio
70:30
Just-in-time hiring
Build vs Buy
Hiring from Tier 2/3
cities
Alternative talent
pools increasing
ratio of non-
engineers
2845
3045
34
106
156168
73
FY01 FY02 FY03 FY04 FY05 FY06 FY07 FY08 FY09
IT fresher addition
IT fresher addition
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Industry Best Practices
Insist on Relieving Letters Ethical Hiring Campus Hiring in 8 th semester Support reference checks and mandate background checks Check on non-compete agreements from customer contracts Service Notice Period with previous employer Discourage frequent job-hoppers (less than 6 months) Partnership with Executive Recruiters Association to follow similar practices.
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Thank You