Overcoming India's talent crunch

Training and overseas travel opportunities help TCS lower its attrition rate and grow its talent base.

To address India's rising wage costs and IT manpower shortages, Tata Consultancy Services (TCS) has, among other measures, established an academic program with more than 300 local institutions.

According to S. Padmanabhan, executive vice president for global human resources at Indian IT services company TCS, there is now a rising demand for IT workers as technology and IT services companies establish operations in India. The IT giant has 89,000 employees in over 47 countries.

"India is producing 400,000 IT engineers a year, and IT companies hire about 250,000 of them," Padmanabhan told ZDNet Asia. "So, there's now pressure on the universities to produce more graduates."

Signed, sealed, delivered

Snapshot of several outsourcing deals that use TCS' Indian delivery centers.

Headquarters: USA
Date signed/announced: Mar. 27, 2007
Contract value: N.A.
Nature of contract: TCS to provide KPO (knowledge process outsourcing) services in clinical research, including clinical data management and clinical submissions support.

Headquarters: U.S.A.
Date signed/announced: Jan. 16, 2007
Contract value: N.A.
Nature of contract: TCS to provide IT infrastructure support to Kimberly-Clark's operations in the United States, Europe, South America and the Asia-Pacific region.

Headquarters: U.K.
Date signed/announced: Nov. 29, 2006
Contract value: US$65 million
Nature of contract: TCS takes over the entire IT operations, asset management and planning for Somerfield and provides a fully managed IT infrastructure and applications service within Somerfield. As part of the agreement, TCS manages third-party hardware, software and services contracts.

Headquarters: Australia
Date signed/announced: Nov. 9, 2006
Contract value: US$90 million
Nature of contract: TCS signed a seven-year deal with Qantas to provide a range of IT application, transformation and maintenance services. The Qantas contract is the largest single agreement awarded to an Indian outsourcing company in Australia to date.

Temasek Holdings
Headquarters: Singapore
Date signed/announced: Mar. 15, 2007
Contract value: S$5 million (US$3.3 million)
Nature of contract: TCS to provide services around the Hyperion product suite, including data acquisition, data storage, financial consolidation and modeling, as well as reporting capabilities.

Parkway Hospitals
Headquarters: Singapore
Date signed/announced: Jan. 30, 2007
Contract value: S$6 million (US$3.9 million)
Nature of contract: TCS to customize and enhance its Hospital Management Solution (HMS), as well as implement the Oracle E-Business Suite for Parkway Hospitals.
-- compiled by Isabelle Chan, ZDNet Asia

Padmanabhan noted that while tier-one universities such as the Indian Institutes of Technology located across the country have the resources to produce high-quality engineering graduates with little difficulty, lesser-known colleges have their challenges.

To address the talent crunch, Padmanabhan said, TCS will establish faculty development programs, student internships, seminars and workshops at the tier-two and tier-three universities. "The whole idea is to bring up the capability of the students, thereby increasing our talent pool," he explained.

Part of the strategy to expand the talent pool is to target not only engineering students but those in other majors, too. Padmanabhan said: "We've identified and experimented with a few institutions, handpicked some of their Math and Science students, and put them through a rigorous six-month training program.

"An engineering course is usually four years long, while Math and Science courses take only three years to complete."

Noting that more still needs to be done, Padmanabhan said TCS is expected to hire an additional 3,000 non-engineering graduates in 2008.

Apart from hiring from its own backyard, TCS is also eyeing talent outside Indian shores, particularly in China.

"If 400,000 engineers come out of India every year, the equivalent in China is 1.2 million--and they're all of very high quality," Padmanabhan said, adding that TCS will step up its operations in China to take advantage of the abundant talent pool there.

"In this industry, it doesn't matter where you do work, whether it's in India, Eastern Europe or China, because we're all well-connected through our global delivery model," he explained.

Once TCS expands its talent pool and hires the right people, the next step would be to ensure that the new workers can be deployed to their job scopes immediately.

"For that, we'll put them through a 42-day training program, which is replicated across our global development centers in China, Brazil and Eastern Europe."

Padmanabhan said a uniform staff induction program across its global offices will address the company's business needs.

"We'll make sure that everyone has sound engineering principles derived through our experience by working with many international customers," he said. "Then, we'll also make sure they understand the technology required to service our customers in future."

Padmanabhan noted that about five years ago, much of the company's work was done on mainframes and Unix boxes, and using the C++ programming language. Today, most of TCS' development work is done on the Java platform, he noted.

"Technology's always changing, and we have to keep on upgrading our technology caliber to stay relevant," Padmanabhan said.

In addition to hard coding skills, Padmanabhan noted that TCS places emphasis on people and language skills to ensure its pool of quality talent meets the needs of the globalized IT and outsourcing industry. "We'll send them to different parts of the world and expose them to different customers," he added.

TCS' efforts have paid off. The company now enjoys the lowest attrition rate of about 10.6 percent in the industry, Padmanabhan claimed. IT job attrition among big Indian companies, he said, is around 14 percent but the rate may be higher in business process outsourcing.

Being able to retain talent "is not something that can be achieved overnight", he added. "It has to be well thought through systematically, where we address three aspects of an individual's career: good technology capability, international exposure and opportunities to exhibit their talent, such as music, on campus."

TCS has also gained recognition for its human resource development. For example, the company received the 'Investors in People' award for setting standards of good working practices in the U.K. It also won the Dataquest-IDC Best Employer in IT Services in 2005.