Lending the words of Indian Prime Minister Narendra Modi, India well and truly believes in making this decade a ‘techade.’ The IT industry in India is ready to move on to new destinations, driven by everything from improvement in internet connectivity to a robust consumer market and acceptance of digital India. According to a new report by NLB Services (a talent solution company), The Indian IT sector is anticipated to host a positive turnaround with an 8-10 percent increase in hiring in 2024. Deciphering the latest trends, opportunities, and challenges in the Indian IT hiring, retention, and talent management scenario is Rajesh Balasubramanian, Executive Vice President & Global Head – Talent Supply Chain, Hexaware Technologies Limited. With nearly three decades of professional experience, Rajesh is a specialist in human resources management, talent management, talent enablement & deployment, talent acquisition, business and talent transformation, and program management.
In Conversation with Rajesh Balasubramanian, Executive Vice President & Global Head –Talent Supply Chain, Hexaware Technologies.
Hiring in the IT sector is expected to grow by 18% this year. How do you think this will affect the industry? What kind of hiring practices do you anticipate?
I expect 2024 to be a mixed year for IT services hiring. We can put this into the demand and supply perspectives. On the demand side, most IT companies, especially services companies, are hiring to reduce attrition or to acquire rare skill sets that they cannot develop internally. Only a few organizations, such as Hexaware, are hiring for growth. This also means that the hiring process going forward will be longer and more meticulous, with multiple rounds of evaluation, including customer interviews, becoming quite a norm. On the positive side, technical software-based assessments will be more common to screen candidates and reduce the burden on interview panels.
On the supply side, the talent pool has become highly narrow over time. The overall IT spending from the clients is also shrinking. This means a significant dent in the number of active job seekers. Hiring teams must revise their strategy to reach out to a more passive job seeker market and overhaul their sourcing strategy. Resumes will not come quickly anymore, and they will require more effort to obtain.
Now, let’s look at the compensation front. It is no secret that the retention budgets and salary increases for high-end companies peaked last year. The spending will continue to decline as attrition drops. The overall talent pool, especially the active job seekers, will also shrink. Some large organizations that hired excessively in 2022 and early 2023 are already laying off staff, primarily those hired in the last 18 months. This will increase the available talent pool but not necessarily create compensation arbitrage. The salary hikes of over 100 percent common during the ‘Great Resignation’ period will not return, and margins will keep eroding as companies will have to pay more for the same roles and rates as before.
The disparity between the organizations’ expectations and the skill sets candidates currently possess is still a concern. From an industry perspective, what are the measures adopted to bridge this gap?
The IT skills gap is quite a vast and persistent problem in the IT industry. However, several efforts are being made to decrease this gap. Let’s take the case of Hexaware. We have partnered with universities and colleges to provide industry-relevant curricula and training for students who want to pursue IT careers. Some of our competitors and we also engage with prospective hires through cultural activities, competitions, events, and industry leader talks. Additionally, we use technology and tools to conduct virtual training and events more frequently. This helps to prepare students for the IT industry and build a robust talent pipeline. On the other hand, the skill gap also persists between experienced candidates, mainly due to customers demanding sophisticated combinations of skills that are rare or unavailable in one person. IT companies have different hiring strategies, such as hiring to the bench, just-in-time hiring, or paying a premium for exact matches. However, I think the best approach is a hybrid one, where the companies forecast the demand, look at the tech landscape, and hire candidates who are a 70 or 75 percent match. Then, they train them for the remaining skills and onboard them. I think this will be the norm in the future.
What kind of Additional skills or qualities do you think aspiring IT professionals need to possess in today’s context?
The IT skills that are most in-demand are constantly changing. Generative AI is still evolving, and only some people have expertise in it, making it a hot area. Full-stack developers and architects who can design and build web applications using various technologies and frameworks are always in demand for their versatility and skills. The demand for experts in data engineering and warehousing, which involves using platforms such as Snowflake and Databricks, is also increasing as data becomes more valuable and complex. Cloud migration, transformation, and performance testing experts are also in high demand. Additionally, enterprise software platforms, such as Oracle, SAP, and Workday, are still the most used business platforms, and it’s no wonder these skills are in high demand as companies have resumed their normal operations after COVID-19.
This also means that the hiring process going forward will be longer and more meticulous, with multiple rounds of evaluation, including customer interviews, becoming quite a norm
How does Hexaware intend to promote continuous learning among its young employees? What are the areas of focus and the initiatives or developments that will support learning?
I firmly believe that a learning culture cannot be imposed. Leaders who endeavor to build an ecosystem must create a culture that encourages learning naturally. Hexaware is one of the few organizations that have consistently succeeded. In my stint here, Hexaware is probably the only company that reimburses any certification that an employee passes successfully without any hassle. We also have a principle that employees should be allowed to carve out their paths, with some guidance, that are aligned with their aspirations and the company's goals. This intrinsically builds a healthy and conducive environment for learning. Hexaware is a case in point, as it has moved to a hands-free but not hands-off governance, where no approvals are required for learning applications, and the learning outcomes are seamlessly integrated with the career development platforms. This ensures that the employee's learning contributes to the company's growth and their own. The way to foster a thriving learning culture is to be continuous in what you do, not reactive or proactive.
How do you think technology will affect the candidate selection process and the overall candidate experience going forward? Please elaborate on the primary skill set required and how technology will identify suitable candidates.
Technology is transforming the hiring process in multifarious ways. As I mentioned earlier, the sourcing paradigm has shifted entirely. It is not enough to do a basic and generic search to find quality profiles that match the requirements. Both job sites and sourcing professionals use more sophisticated and optimized ways to represent and search. They leverage technology to the fullest to carve more nuanced and specific search strings. In addition, they also use AI and ML-based search and match tools and interview platforms that help find the best candidates for the job.
In other words, technology has improved the quality of matches and recommendations while reducing the manual efforts of recruitment processes and, in turn, reducing errors. It has also reduced the turnaround times and standardized the operations and logistics of recruitment. However, technology is more than just a one-size-fits-all solution. It needs to be customized, adapted, and utilized according to the needs and preferences of each company. Technology will significantly improve the candidate and company hiring experience in 2024.
What would be your advice to budding HR leaders in the IT industry?
My advice for budding HR leaders would be to keep up with the latest trends and technologies in the market and experiment with them. But do not simply copy market trends; instead, nuance and contextualize them to your situation.
You must also develop a skills framework and a talent profiling system to understand your internal talent inventory and position it better for the customers. Encourage your employees to boost their learning and contribute to the organization.
Hobbies: Driving and travelling
Favorite Travel Destination: Hawaii
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Favorite Movie: The Godfather
Favorite Book: Cain and Abel by Jeffrey Archer