In a job interview at a big drug company, the human resources (HR) manager was caught on the wrong foot. The prospective candidate for an entry-level HR position, a management graduate, wanted to know how much time the company’s chief executive spent with his people, the company’s HR philosophy and the HR budget. Also, why HR found no mention in the company’s annual report.
Awareness about HR functions is on the rise. It is becoming one of the key differentiators between a good and a great company. “As HR is becoming strategic to competitive advantage, the job has seen a shift from a support role to a core function. Employer branding and value proposition come from people, and managing human capital is becoming one of the most strategic functions today,” says R. Raghuram, director, HR, Asia Pacific staffing and mobile devices India, Motorola.
With the growth of industries in knowledge verticals such as IT and BPO, human talent has become the most important asset, say HR managers. “Today, managing the motivation of a skilled workforce has brought to the fore the need for robust HR practices,” says P. Dwarakanath, director, group human capital, Max India Ltd, and president, National Human Resource Development Network, the apex body of HR professionals in India.
Hiring is a key proposition for companies. As every company needs HR professionals, the industry is facing an acute crunch in hirers. There were more than 5,000 HR job postings out of a total of 82,000 vacancies on job portal Naukri.com as of 28 May. There were more than 3,73,336 résumés for HR jobs.
“The number of HR job postings has gone up by 40% over the last two years,” says Sanjeev Bikhchandani, co-founder and chief executive officer, Info Edge (India) Ltd, the parent company of Naukri.com. There are about 1,00,000 HR professionals in India and the demand is huge, says Dwarakanath. “For every four jobs, there is one good HR professional,” he says.
Also, there is little proven HR talent available. “There is a serious shortage of good quality professionals in human resources in India. This shortage is acute in the 10-15 year profile, where quality seems to have become the greatest casualty,” says Manab Bose, executive director, Tamara Capital Advisors Pvt. Ltd, a Mumbai-based private equity firm.
Bose explains the reason for the talent crunch: “The economic boom in India, led by IT and BPO firms, has resulted in a groundswell for HR professionals. Individuals with less than five years experience have ridden this wave without acquiring adequate hands-on experience. They are now riding the boom in the manufacturing and services sectors, but they do not have the experience to offer the full range of substantive HR skills needed by modern corporations, leading to a shortage of skilled manpower at the middle and mid-senior levels in industry.”
In other words, there are too many jobs chasing a few good HR heads. Shiv Agrawal, chief executive officer, ABC Consultants, says, “Attrition in HR is higher than, say, functions such as finance.” In the past one month, several HR heads at various leading companies have put in their papers, including Bharti Airtel Ltd’s Daljit Singh, Marico Ltd’s Pankaj Bhargava and Oberoi Group’s Rajesh Padmanabhan.
The tight supply situation has, naturally, led to hikes in compensation. “Average increments among HR professionals have been 15-25% and, for good performers, the raise has been between 25% and 50%. Low-paying sectors, such as manufacturing, have seen significant salary corrections in the past two years,” says Ronesh Puri, managing director, Executive Access, an executive search firm.
In an effort to bridge the gap, the industry is associating with training schools. “HRD Network, in association with the Confederation of Indian Industry and management institute, XLRI, Jamshedpur, has developed a competency model for practising professionals. We also have a collaboration with the Management Development Institute for a two-year post-MBA,” says Dwarakanath.
Companies are also trying to build talent pools. “It is difficult to retain HR professionals in jobs that have a high proportion of system maintenance work. Therefore, many organizations are outsourcing non- value-added roles such as payroll to retain HR professionals in the system,” says Bhagwat Yagnik, vice-president, global human resources, Ranbaxy Laboratories Ltd.