NPA - Discover India

Discover India: A Global Talent Hub

http://optionsindia.com/index.htm

• India - Economic Overview

• India – The Demographics

• Key Challenges for Search Firms

• Conclusion



- 5,000 year old ancient civilization 325 languages spoken – 1,652 dialects 18 official languages

- 29 states, 5 union territories 3.28 million sq. kilometers - Area 7,516 kilometers - Coastline 1.3 Billion population.

- 5600 dailies, 15000 weeklies and 20000 periodicals in 21 languages with a combined circulation of 142 million.

- GDP $576 Billion. (GDP rate 8%)

- Parliamentary form of Government Worlds largest democracy. Worlds 4th largest economy.

- Largest English speaking nation in the world. 3rd largest standing armyforce, over 1.5Million strong.


Economic Overview


Economy on course for growth of 8.7% Fastest growth in 18 years

A consumption-driven boom

New emerging middle class, IT/BPO spillover ITES growth in 2007/08 of 31%

Wage gains fuelling buoyant demand

Spending rather than saving And borrowing

heavily

Trade, hotels, transport, comms: up 12% (from 10.4%) Manufacturing up 11.9% (from 9.1%)

Banking, insurance, business services: up 13.9% (from 10.9%)


Economy Surging ahead


Indian Economy poised for sustained growth of 8% over the next 10 years ; GDP growth pegged at 8%

50% of India’s population is under 25 years of age and 80% under 45 years

Increasing urbanization has led to changing consumption and spending patterns 4India, the third most attractive Foreign Direct Investment destination, next to China and US

Strong emphasis on English as the means of education, with a specialist thrust on science and mathematics

One million new English speaking graduates pass out every year

High quality technical skills driving India towards becoming the global R&D hub

More than 120 MNCs have already set up R&D labs in the country

India increasingly being recognized as a low-cost production base - outsourcing of manufactured goods is the new trend




The Demographics: India and the Global Talent Pool - A ComparisonLow Medium High

India Israel Canada China PhilippinesRussia Ireland

Government Support

Labour Pool

Infrastructure

Educational System

Cost Advantage

Quality

Cultural Compatibility

English Proficiency

Overall Climate

Source: Gartner Research Cost, Quality & Language advantages1/7/2008


• Largest youth population (One quarter of the world’s youth lives in India) •Growing literacy rate.

• Large pool of professionals and technocrats •Largest pool of English speaking manpower after US

India Demographics assure increasing domestic demand Set to become service provider to the world


India - Demographic advantage


China Demographic France Demographic India Demographic Profile (2020) Profile (2025) Profile (2020)

Age group Age group Age group 80+ 80+ 80+

75-79 75-79 75-79 70-74 70-74 70-74 65-69 65-69 65-69 60-64 60-64 60-64 55-59 55-59 55-59 50-54 50-54 50-54 45-49 45-49 45-49 40-44 40-44 40-44 35-39 35-39 35-39 30-34 30-34 30-34 25-29 25-29 25-29 20-24 20-24 20-24 15-19 15-19 15-19 10-14 10-14 10-14

5-9 5-9 5-9 0-4 0-4 0-4

-60 -40 -20 0 20 40 60 -60 -40 -20 0 20 40 60 -3 -2 -1 0 1 2 3

60 40 20 60 40 20 3 2 1 Mn people Mn people Mn people

20 - 35 age group : 20 - 35 age group : 20 - 35 age group : 325 mn people (~25 %) 308 mn people (~21 %) 11 mn people (~17 %)

Source: CII Conference 2002; CSFB Report; UN Population Division; BCG Analysis Female Male

25 % of total population is in the peak Working Age


Future Demographics - 2020


Potential surplus population in working age group (2020) -3 MnGermany

UK -2 Mn

Russia Czech 0Mn Republic -6 -1

Turkey MnIreland MnIraq -17Mn 2Mn -3 Mn China France -10 US 2Mn Israel -9 Mn Japan MnIran Pakistan 0Mn 5Mn Spain -3 Mn -2 Mn 19

3Mn Mn 7 Philippines MnItaly 47 Bangladesh 5Mn 4Mn MnEgypt Mexico 4Mn India

Vietnam 1Mn

Malaysia

5Mn 3Mn Indonesia

Brazil -0.5 Mn

Australia

Source : Hewitt 2006 Study

India likely to have a 47 Mn Working population Surplus


This results in …


India has among the India is among the highest returns on three most attractive foreign investment FDI destinations in the world US Department of Commerce

A T Kearney FDI Confidence Index 2005 By 2032, India will be

among the three largest economies in the world

BRIC Report by Goldman Sachs, October 2003 “India is a developed

country as far as “We came to India for the intellectual capital is

costs, stayed for the quality concerned.”and are now investing for

innovation.”Jack Welch

General Electric Dan Scheinman, Cisco System Inc. Business Week, August 2005


Leading to… Destination India ?


Understanding Cultural issues is critical for Success

- Indians are more aligned to western styles of management - “command and control” is not very effective

- Life term employment is no longer seen as desirable, or in the best interest of the Executive

- India is a very diverse and heterogeneous country - there is no one right answer

- Designation, Titles and career Promotions very important for Indian Managers

- Indians pay greater regard to intellectual ability rather than craftsmanship- Technical staff is typically paid lower than Managerial talent

- Indians tend to over-commit and have difficulty in saying “No” - need to have a monitoring and review mechanism in place


Key Challenges… Bridging Cultural Gaps


Booming Indian economy Leading to phenomenal growth of Executive Search firms in India

Clients are looking for trusted business advisors Search firms need to transform themselves

Global shortage of right talent - companies need specialist who help them hire…..

Increasing Indian Companies are setting up businesses overseas……. Indian talent gaining recognition in the Global Landscape….foreigners looking jobs in India, New MNCs Coming in.

Recruitment Industry in India is estimated at around over 2 Billion Dollars (Source: Service Tax Collections)

Increased competition at higher end of the market More international search firms setting up shop in India…. Second round of consolidation expected…. MNCs acquiring local firms to get a toe hold in the “ Hot” Indian Market.

Indian Executive Search Industry is at a Crossroad


A few trends in Executive Search


Hiring challenges have a different texture in India

- High Growth Model, Sourcing mix is different

- Entry Hiring 10 – 40%

- Contingency workforce not popular

- Experienced Hiring – Cost Impact is controlled

(Direct Hiring – 35%, Employee referral – 35%)

- Leadership Hiring – Potential for Expats/ Returning Indians very high as companies go

global


Hiring challenge that Search Firms & Cos. face


The Changing Environment Conclusions …

- Indian economy is growing fast. Presents a variety of opportunities.

- India presents itself as both a source & destination for Talent.

- Indian Corporates are also looking to expanding across continents.

- Collaboration among NPA Members could be the value add !!

Its going to be an exciting ride … Are you game ?



Psst……Indians in the USA.

Statistics shows:

38% of doctors in the USA, 12% of scientists in the USA, 36% of NASA scientists, 34% of Microsoft employees, 28% of IBM employees, 17% of INTEL scientists, 13% of XEROX employees,

US H1-B Visa … are Indians. applicants country

of origin

1.India 44% 2.China 9% Of the 1.5M Indians living in the USA, 1/5th of them live in the Silicon Valley. 3. Britain 5% 4. Philippines 3% 35% of Silicon Valley start-ups are by Indians. 5. Canada 3% 6.Taiwan 2% 7. Japan 2% Indian students are the largest in number among foreign students in USA. 8. Germany 2% 9. Pakistan 2% 10. France 2%



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