Absence of hard skills

Article in People Matters by Santanu Paul


Jun 4th 2012
By Santanu Paul, CEO, TalentSprint

Santanu PaulThe mismatch in terms of demand and supply of skilled workforce has been there for many years, and is expanding rapidly. This disconnect is slated to widen and get worse than it is today, over the next 5 to 10 years, before the correction begins. The reasons for this are many. One is the huge demographic dividend in terms of the number of young people growing. Second reason is that there is a rapid push from policy makers and professional bodies to triple the number of seats available to college going students in the next 10 years in order to improve the enrollment ratio, so that supply is closer in terms of demand numbers. Also, at the same time there is a dramatic need of faculty, both in terms of quality and quantity. So, there is a sort of a perfect storm that has come together. It is going to make the mismatch quite significant and it is scary at some level. At TalentSprint, we have built a model where we can solve the problem of mismatch in terms of creating the supply of skilled people. We are a talent refinery like an oil refinery. Oil refinery takes the crude oil and converts it into finished petroleum; we take crude talent, which is available from colleges of India, especially those form Tier 2 and 3 cities and convert them into industry ready talent. 

Quite frankly, the industry has been complaining for a long time that they cannot find enough employable graduates and those that they select need to be trained since college education is not sufficient for them to be industry ready or employable. The cost of training people after recruiting them at a fresher level is very high. For instance in the IT industry, the average spend on training/skilling an individual would be approximately Rs. 2 lakh before they become productive. As a matter of fact, the commitment that the IT industry makes towards entry level training is close to Rs. 4,000 – 5,000 crores per annum. In fact, we have shown that companies can witness an increase of 2%to the bottom-line just by avoiding this entry level program.

Generally, bigger companies have good internal entry level programs. They have internal academic universities and models in place to train and skill the new hires to convert them to deployable resources. Though these initiatives come at a huge economic pressure, larger organizations nevertheless can afford them. I think companies are now increasingly realizing that this expense is not worth incurring and prefer not to get into skilling, because it is not their core competency. Preferably, they should not be in the business of doing academic work or teaching or training. The entire National Skill Development Corporation movement, Talent Sprint and Purple Leap are basically a new class of companies who are trying to bridge this gap by creating a profitable business model, that will benefit the society in terms of cost reduction and obviously create very effective solutions.

When students from Tier 2 and 3 towns come to us, they need training not just in soft skills, but also in hard skills. One of the big myths out there is that people just need to polish up, as in a finishing school, assuming that core part of the cake is already baked and you just need to put some icing on it. That is not really the issue. The issue is that there is no cake baked or otherwise. So, we need to work towards creating hard skills in the first place and then top it with the soft skills. It is quite a bit of work and it is clearly evident that the further you go from the big metros, the more you notice that the colleges created in the last 10 to 20 years in tier 2 and 3 towns are often run by politicians or real estate people, and all of these are essentially the breeding grounds of unemployable youths.

In my view AICTE has been a party to creating this anomaly, by giving permission and approvals without adequate checks and balances on quality infrastructure, teaching faculty, etc. When the students come here, they need quality intervention, so that becomes a priority for us. Quality is the first part, because if somebody is well-trained and certified by us, then they automatically become employable and get a job and all is well. On the other hand, mere quality is not good enough, because for us to make a difference, when we are talking about 30 lakh graduates this year, and that number is likely to rise to 70-80 lakh graduates by 2020; quantity counts too. If 80 percent are unemployable; then imagine in the year 2020, there will be 80 lakh graduate students of which only 16 lakh could be employed and 64 lakh graduates would have degrees but no jobs. We are staring at a social revolution.

Different industries require people with different skill-sets. If you plot a kind of a matrix, you will have multiple industries as columns and rows with categories of people – class 10 pass, class 12 pass, graduates, post graduates, etc. At each point there is a problem. We only work with college graduates, because we don’t want to work with class 10 and 12 pass kind of jobs. We also work with only IT and banking and financial services industry. We focus on knowledge incentive jobs in the white collar sector, which requires both domain knowledge and soft skills. We are trying to work with those industries where there is sophistication needed in the person to become employable. We are staying focused entirely on knowledge incentive jobs where you must have good domain, software skills and technical skills.

Smaller and medium sized companies are much more eager to embrace TalentSprint type of models compared to larger companies. Historically, large companies have learnt how to cope on their own. Their volumes have been large and they cannot rely on colleges, so they have built their own talent management stations. When you go to a large company, there is a mindset that they can do it themselves. Medium and small companies struggle the most. When they go to campus, they don't get day 1 or day 2. They don’t get access to the big talent, because the big companies go and get that access. Placement officers tend to prefer big companies. Medium and small companies get derailed. They don’t get access to the best talent. So, for them what we offer is a far better solution. We offer a fully trained certified professionals who may not be top 10%of college population in terms of IQ, but they are somewhere between 60th and 90th percentile of the talent pool. On top of that, the benefit for the small and medium companies is that the people have paid for their own training and certifications and thus there is no financial pressure on these companies in terms of skilling them. The medium and small companies can just come and recruit. In a sense, we are an alternate campus, which is designed for the benefit of medium and small companies. They can walk-in any quarter and pickup fully trained people, unlike a campus where you go once a year and you pick up people who have only theoretical skills and not the industry skills.

A number of medium companies have actually been the biggest beneficiaries. There are many examples of companies where they have gone ahead and recruited a lot of people over the years. There are a couple of companies, which have taken 400 - 500 people and essentially saved 70 to 90 percent of their entry level training and recruitment cost. Our mission is that if you work with us as a company, we can deliver close to 70 to 90 percent savings on your entry level talent–recruitment and training.

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