Tuesday, December 08, 2009

Hiring in India -the differences

This post is the last of the 3rd "Hiring in India' series that I attempted over the last weekend to look at a slightly macro level view of 'why we do what we do' on a daily basis :-)!

I must however attribute the same to the discussions triggered by a client of mine-a MNC company with operations in over 20 countries, and embarking into the Indian territory for the first time. A senior professional with over 25 years of experience in large companies, in pharma and telecom domains across the world, the wealth of experience was a great insight to me. We spent a major part of the hour and half discussing on the specific issues relating to operating in India-bordering around some statutory/mandatory requirements stipulated by the Government, some customs and local traditions, and some on the best practices in the trade!

So, is indeed hiring issues for companies in India very different from Europe/US?

I shared these thoughts on a few online online communities/yahoo groups, related to just the hiring process for any new entrant and got the following endorsements/ comments!! :

1. The time taken from the time of acceptance of an offer -to the person joining- in India !! The
notice period is about 2-3 months here. Elsewhere people can join in 2 weeks after offer acceptance.

(Gagan Bhatia):Western countries mainly have "Employment at will" and hence employees can leave their previous organizations in virtually no time or within 2-3 weeks depending on the level of responsibility and seniority. Whereas In India, the notice period usually ranges from 2-3 months and hence results in a very long lead timefor hiring. This poses as a major challenge for hiring managers. Also it puts an additional liability to the hiring company in case employee is foregoing the "notice pay" and the new employer has to pay for it.

(Ravinder Bhan) In India is there anything called a severance package in case of involuntary separation? Notice salary is no compensation for an employee whose services are no more required. While the employer may quote the employment contract and the terms therein, any sensible court will throw the contract out of the window for the simple fact that its one sided and the employee has no say whatsoever in changing anything it.

Joining period of 2/3 months is not unique to India; it depends on the candidate’s terms to conclude the existing employment contract. In fact I would be very suspicious if a candidate agreed to a 2 weeks joining period.

2. Higher expectations of a salary when changing jobs !!(up to 25% over last drawn salary)

Perhaps it has got to do with the inflation rate in India, annual increments are typically 6-10% here-while they are more modest elsewhere.And more -in fast growing industries, where there is a premium for proven track record-as a retention strategy.

(Gagan Bhatia) Additionally, a substantial portion of hiring in western countries is through the temp or contractual route which still is considered as a social taboo in India. Candidates always prefer a permanent job even if it pays 20-30% less.

(Anil Kumar Singh) :Increments in Indian industry are a direct function of EBITDA of the business. For instance telecom had EBITDA of 40% & thus increments were obscene. Manufacturing/Process may not be able to offer the same. I clearly see this even-ing out when the business matures.

3. Sheer number of applicants for any given positions! And the sensitivities involved. As a recruiter-in response to a Vice President role advertised, I have seen innumerable applications from even junior/ entry level aspirants as they are quite positive there would be more openings in the pipeline :-)!

(Gagan Bhatia):the number of applications in India is extremely high with an average of more than 10 applications for one position. This leads to a greed in recruiters to interview more people to find the best possible.. Considering that the next candidate may be marginally better than the previous.

(Ravinder Bhan). Number of applications could be huge because the job advertisement is not rightly crafted. In my opinion if an advt. mentions what the employer is exactly looking for – lot of applicants can be spared the trouble to apply

4. Tenure spent with each employer. I have had some uncertain moments trying to convince some of my MNC clients when they screen resumes forwarded by us. They tend to look at a resume with suspicion if they have changed more than 2 jobs in the past decade:)!!.

Today an average Indian job seeker tends to change a job once in 3yrs!!This is something which has changed in the past 16-17years -and can perhaps be attributed to the post liberalisation days of Indian economy. And interestingly, perpetuated by all the stakeholders in the process!

a) Increasing number of passive jobseekers, as they are open to looking -lest they miss out on any opportunity that could catapult them to the next level

b)More companies have been entering India-and are less patient to 'farm talent' -often preferring to 'poach talent' from competition-and not only have access to someone with a proven track record, but also weakening a key rival in the process!!

5.(Mitul Mehta)Working from home is a popular work culture in corporations in the US. However it is almost unheard in India with the exception of IT industry.

Juxtaposing the impact of cultural connotations, I am beginning to think that we in India, are in a different world?!!Nothing connected in the context of the cost arbitrage that off shoring or outsourcing is connected with?? Are we taking too many things for granted?

I shall be glad to be corrected!!


Krishna said...

Agree with most of the points made here.

Would like to juxtapose what Ravindar Bhan & Mitul Mehta have mentioned. In India we don't have a strong social security system. So it acts as a deterrent for people to explore new options such as free lancing. And combining with point 4 you mentioned, people who are freelancing aren't readily accepted back into the system.


AK Menon said...

Krishna, Brilliant point!

I guess the word "Sabbatical" in the West connotes 'enjoying or bringing an intermission to work'!!

Such a practice perhaps brings in a work/life balance too.

As we in India get more sensitive to such practices, we might see 'increased knowledge management' injected into academia too with some of the managers from industry willing to do research and take a break occasionally!!