The Hindu Business Line : IT's hungry for more and more talent

CONTINUED hiring across technology disciplines, concerns about attrition levels in the IT Enabled Services resulting in higher costs and increasing real estate prices forcing companies to look to tier II and three cities have emerged as some key trends, even as the sector expects the growth to continue.

The technology sector is transitioning to the year 2006 riding on 30-plus per cent growth and if the current projections are any indications, there is likelihood of pressures on finding the right talent. A snapshot on the sector outlook based on interaction with a cross section of technology sector players.

The Head of Human Resources, Accenture India, Mr Rahul Varma, giving a HR perspective told Business Line that all trends pointed towards continued buoyancy in the marketplace even as companies look to non-traditional centres to tap talent. This will be further accentuated by the fact that new streams of technology areas are being outsourced, offering a diverse section of people technology sector jobs.

"We envision continued demand for talent both in IT and ITES and that the demand is likely to intensify. Companies would seek innovative ways to tap and retain talent," Mr Varma said.

The Vice-President of the Natioanl Association of Software and Services Companies (Nasscom), Mr Sunil Mehta, said, "the recent study of Nasscom and McKinsey, points that there could be shortage of skilled professionals, as technology sector players scale up the value chain."

Citing the case of ITES, Mr Mehta said, "this has actually broadened the scope of employment. In fact, if you analyse the nature and scope of the business and processes that these companies are handling, they have opened up careers of people from non-conventional sectors to support both global companies and within India." Without actually getting into numbers from these areas, he said that the sector would be able to post a growth rate ranging between 28 per cent and 32 per cent."

Giving a venture capitalists perspective, the Managing Partner of Norwest Venture Capital, Mr Promod Haque, that manages funds of about $1.8 billion, said the scope of funding would likely expand to new areas within the technology sector such as media and broadcasting, and technologies that help delivery of information through multiple devices over the Internet would be favoured.

Echoing a similar view, the General Partner of Gabriel Venture Partners, Mr Navin Chadda, said, "A lot of funds have raised new capital in 2005 and we expect VCs to deploy them in later stage and larger deals. India and China have demonstrated that they can build world-class venture backed companies, not just lower cost versions of US companies. There is increased potential for M&A activity."

According to Cushman & Wakefield, a real estate solutions provider, the IT and ITES sectors will continue to drive the market across cities. The commercial office space supply is lagging demand and this imbalance is likely to remain till the first quarter of 2006. This is a connecting trend in other metros. It is projected that participation of national and international developers and funds would be stepped up in development of IT parks and commercial establishments. The capital and rental markets which have spurted lately would remain firm, forcing companies to look to next level cities.

The Managing Director of Cognizant, Mr R. Chandrasekaran, said, "One clear trend that we saw in 2005 which will get further accentuated in 2006 is that customers are looking for a much broader relationship with its IT partners. Companies that demonstrate this capability would be better positioned to carve a disproportionate amount of business in the marketplace."

"This means that the IT partners need to engage with the customer in a much more inclusive fashion through a far greater understanding of the business pressure points and pro-actively providing solutions to business problems leveraging technology, rather than mere technology solutions. As such companies need to have a more consultative and domain-driven approach to customers rather than merely leverage the technology capability," Mr Chandrasekaran added.

Customers are looking to work with partners with a broader range of related capabilities. Enterprise customers, for example, look for a broader range of capabilities in the business applications space, including testing, vertical-BPO (the form of BPO that is at the intersection of domain and technology), ERP, CRM and data warehousing and business intelligence.

A global survey on M&A activity of KPMG has projected continued heightened activity in India across sectors, including technology through 2006.

Domestic majors such as TCS, Infosys, Wipro and Satyam and MNCs such as IBM, Accenture, Cognizant and even small companies have all stepped up hiring.

A Teamlease outlook survey on recruitment patterns predicted a strong hiring trend at the back of economic growth. Trends and industry players' perspective concur towards momentum in the sector.

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