Author: Rana Kapoor, MD & CEO, YES BANK & Chairman, YES Global Institute
This article appeared in The Hindustan Times on May 10, 2018
India needs to set aside adequate financial resources for education, healthcare & skill development
As we enter the emerging global era of disruption characterized by a combination of parallel forces of artificial intelligence, robotics and automation, the firms and businesses are faced with multiple challenges: Identifying top talents with unique skill and the leaders of tomorrow who are meant to be looking at new solutions and offerings, redefining competitive advantage, restructuring constantly coupled with strategic talent management.
At the same time, India is experiencing the demographic ‘sweet spot’ wherein the working age population shall continue to increase till 2030, and without a visionary talent management ability we will end up wasting a massive potential with the long term threat to achieve social cohesion. The collective intellect and intensity of modern India presents the opportunity to undertake pre-emptive measures which could enable us to contribute and benefit from this latest era of disruption.
Developing and empowering human capital to make seamless shift and adapt to the new technology world is key to make sense of India’s huge demographic dividend. Despite the sweeping recognition about how vital it is to invest in both the quantity and the quality of jobs for youth, efforts remain fragmented and lack scale. There needs to be a cohesive plan to fundamentally strengthen the workforce and enable successful and smooth transition to the digital era. Strategic management of human resources is critical both at the national level as well as at an enterprise level in this era of disruption.
India ranks 51 among 63 countries in IMD World Talent Ranking 2017. This has improved marginally from 56 since the ratings were initiated in 2013. China has shown greater improvement from 48 to 40 during this period. An integrated talent management plan for a country like India is encountered by some structural challenges.
First, there is an ongoing huge migration of talent from the North to South and Western parts of the country which account for 70%of job opportunities. While some internal churning is good news, adequate gainful opportunities in North and East India is very important, especially in like UP and Bihar.
Second is the issue with vocational education and skills. A credible and robust skill ecosystem needs to be put in place urgently, so that vocational education becomes aspirational and contributes to manufacturing and trade services growth. Next, India needs to set aside adequate financial resources for social sectors of education and healthcare. Social sector spend stands at 7.5% of GDP which is lower than all OECD countries and most developing countries. Finally, we have to find ways to increase female participation in the labour force.
However, in this era of flux, leaders and HR managers are faced with twin challenges. One can be a bit too late in capturing the trend and risk getting outdated in the marketplace resulting in loss in competitive edge or customer centricity. Every CEO therefore has an added responsibility of keeping up with technology prowess of his/her human resources. However, this is easier said than done, with every available channel of communication playing the devil’s advocate and is busy analysing how much of the workforce shall become redundant due to these technologies! At the end of the day, the leader at the helm has to identify which one of the disruptions shall have a lasting impact on business and merit immediate management attention and investments.
The second challenge which is equally significant and less appreciated is over exuberance in pushing through fancy ideas causing unnecessary churn in well entrenched departments or personnel dedicated to specific roles. The job of a CEO and HR manager is to balance these two aspects and build a very robust and dynamic environment while ensuring broader stability of the workforce.
A cardinal guideline of managing this situation is putting the customer at the centre of the thought process while devising skills and workforce development strategies. In addition, enterprises have to be mindful of allocating adequate resources to invest in innovation. Irrespective of business growth and economic cycles, workforce agility has to be ensured with a heavy dose of motivation, training and continuous learning. To conclude, having an agile work environment that can reinvent itself is necessary when the future is uncertain.