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Competency Based HR Practices in India:
Yesterday and Tomorrow – Lessons for South Africa
Dr. S. Pandey
Corporate Comprehensive Management
Consultants
India, Bombay
Key note Address at the Annual Conference of
ACSG, Stellenbosch- South Africa
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Scope and Objective (contd.)
Objective:
Insights for HR-Professionals and Enterprise
owners based on macro level secondary
data and ethnographic approach
Ideas about setting up business in India specific
emerging Industries
Ideas about specific business opportunities for
AC-professionals and Management
consulting in general
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India Business witnessed some critical
events recently
Pre-liberalization era (prior to 1990s)
Supply of fresh air in Auto and Manufacturing (post 1991-93)
The advent of IT (post 1992-93)
Speculative bubble covering roughly 1995–2000 (with a climax on March
10, 2000 the dot-com bubble burst)
The Call center’s entry to India, maturing to serious BPO business (ITES –
technology driven). End 1999-2000
The rise of emerging markets; following Y2K, the IT-service business in
many domains, KPOs
The recent economic meltdown (2007-8)
The recognition of economic growth engines along with some of the
developing countries in Africa, Asia, and South-America since the
middle of 2009.
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The story of Competency based HR practice in
Indian Business organizations
Ethnographic Domain: Selected 30 significant
Competency design & implementation
projects selected in western, southern, and
north India; over a period of about 15 years.
Research and consulting assignment of a
group of early practitioners of competency
based work that the author had opportunity
to see from inside
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1994-2000 [large numbers; lower to middle level; long duration; all but 1 had
critical issues
No. Year Project Company
1. 1994-97 Start-up Assessment Center: Design, Development and
Implementation
General Motors (India) Ltd.
Halol, Gujarat
2. 1994-97 Development Center – Institutionalization
Assessor Training
Castrol India Ltd. HO:
Mumbai
3. 1998 - 2000 Development Center for Marketing and Sales Personnel;
Assessor Training
Kirloskar Brothers Ltd.
Dewas, Indore
4. 1996 AC for the Selection Center for civil aviation Pilots Jet Airways (I) Ltd. Mumbai
5. 1996 Internal Selection Center Design & Implementation for
International Safety Rating Group- Assessment Centre for
Selection of Safety Engineers
Oil & Natural Gas Co.
(ONGC)
6. 1999* Competency Assessment of Middle Management
Psychological testing and competency assessment of
middle level executives
Jindal Iron & Steel Co. Ltd.
Mumbai,Tarapur and Vasind
7. 1999-2000 1. Assessment Center: Promotion and Development
Center for Sales Personnel
2. Internal Assessor Training
Colgate-Palmolive India Ltd.
HO - Mumbai
8. 1996* Selection of Top Managerial Positions, including
Managing Director
SPACO Carburetors(I)
Ltd.
Automobile Ancillary
Pune and Vadodara
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2001-2005 [Strategic areas, deep interest; institutionalization
No Year Project Company
1. 2001 Design and Implementation of Software Engineers Selection System Patni Computer Systems
(PCS) - Mumbai
2. 2003 Design, development and implementation of a series of Assessment Centres for
the identification of Future Business Leaders.
Satyam Computer Services
Ltd. Hyderabad, Bangalore,
Chennai
3. 2003 Design, development and implementation of a series of Assessment Centres for
the identification of Future Software Technical Architects
Satyam Computer Services
Ltd. Hyderabad, Bangalore,
Chennai
4. 2003 Internal Capability building through development of an Internal pool of
Assessors
WNS Global Services (P)
Ltd. (Subsidiary of British
Airways) a BPO Bombay,
Pune
5. Ongoin
g
Since
March
2004
1.Design and Implementation of Organization Wide Competency based
Development Centres.
2.DC for all GMs & VPs
3. Internal Capability building through development of an Internal pool of
Assessors
4. Training of all HOD and Sectional heads in Performance Coaching.
5. Technical Leadership Framework : Competency Model Design & Development
Reliance Industries (3
locations)
6. 2005 Development Of Competency Based Systems For End User Sales Personnel &
Sales And Marketing System Audit
PCS Industries Ltd. Mumbai
7. 2004 Organizational Diagnosis: With Special Reference To OCIL’s Readiness To
Implement A Competency Framework Based People Management System
Owens Corning India Limited
8. 2005 1. Behavioural Leadership Excellence Model & Design and Implementation of
Assessment cum Development Centre for Services Group
2. Behavioural Leadership Excellence Model and Design and Implementation of
Assessment cum Development Centre for Product Group
Sasken Communication
Technologies Limited
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2006- 2007
No. Year Project Company
1. 2005 1. Design and Implementation of Competency based Assessment
Centres &
2. Internal Capability building through development of an Internal pool
of Assessors
TeleTech-India
2. 2006 Design, development and implementation of organization wide
Competency based Assessment Centres
WNS Global Services (P) Ltd. a
BPO Bombay, Pune
3. 2007 Technical Expert for NAC – NASSCOM for Assessment of
Competence. With primary responsibility to Lead all Technical
initiatives of TEC (Technical Evaluation Committee).
NASSCCOM (National
Association of Software
&Services Companies)
4. 2007 Behavioral Competency Certification of Delivery Group: The process
review and Augmentation
Infosys Technologies Limited
(Infosys Leadership Institute)
5. 2007 Behavioral Leadership and Technical Leadership Framework:
Competency Model Design & Development and deployment
facilitation.
Flextronics Software Systems
(Aricent Technologies Holdings
Ltd.)
6. 2007 Design And Development Of A Competency Framework For Lead
Analyst, Senior Analyst & Analyst in WIPRO-UBS
Supplementary Selection Tool Development based on Psychometric
Testing for Entry level
WIPRO-UBS BPO
7. 2007 Technical Leadership Framework : Competency Model Design &
Development
Sasken Communication
Technologies Limited
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2008- OnwardsNo. Year Project Company
1. 2008 1.Fresher Selection System Design
2. Workshops On Competency based interviewing skills
3. PMS for freshers based on PR Attributes
4. Competency based Training programmes
Flextronics
Software Systems
(Aricent
Technologies
Holdings Ltd.)
2. 2008 1. Behavioral Leadership and Technical Leadership Framework: Competency
Model Design & Development and deployment facilitation.
2. Development Centre for all General Managers and VPs
Varroc Group-
3. 2009 Design and Implementation of Development Centres for a Select group of
Middle-management employees
Indian Oil
Corporation
Limited.
4. 2009 1. Competency based Organization Structure and Development of Job
descriptions
2. Design and Implementation of Competency based Performance
Management System.
Varroc Group
5. 2010 1. Design and Implementation of Competency Framework and Competency
based selection centre for Entry Level Pilots.
2. Assessor Training Programmes for Pilot- Commanders – Internal Capability
building for Implementation of Competency based selection centre for Entry
Level Pilots
3. Assessor Training Programmes for Managers – Internal Capability building
for Implementation of Competency based selection centre for Entry Level
Pilots
Jet Airways India
Ltd.
6. 2010-
2011
Assessor Training Programmes for Sr. General Managers and Assistant Vice
Presidents – Internal Capability building for Implementation of Competency
based Assessment & Development centre
Preparation of Feedback facilitator
Reliance Industries
7. 2011 Competency based 360 Degree Feedback for MD & top management team Varroc Group
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The summary or Trend analyses
1985-1993:
Localization (Indianization) of MNC
Competency frameworks (that was designed
in EU, Germany, & US parent organizations),
preparation of Method bank, AC stationary,
supplemental psychometric tests, Assessors
training and handholding for deployment
In the form of MDP: Seminars on AC
approach, Assessors training program
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The summary or Trend analyses
1994-2000:
Full blown Competency framework
development for Organization wide use
Start-up Assessment Centre design and
implementation for large scale selection
Indian Manufacturing organizations, Large
PSUs (specialized project), Civil Aviation
(Airlines Pilots)
Approach was mostly problem shooting
events
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The summary or Trend analyses
2001-2005:
Along with Behavioral and Leadership Competency
Models, the Technical competency models
construction and deployments
AC approach based interventions in strategic areas,
across functions, deep interest, institutionalization
Mostly Indian fast growing Large or very large
organizations. Top and middle management level.
Industry: IT (product & service companies), ITES/
BPO/ KPO, Petrochemical, Refineries,
Telecommunication software
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The summary or Trend analyses
2006-2007 (just before global recession)
IT organizations large projects, serious
developmental centers with long drawn interest in
overall Human capital approach; use of AC for
Merger & Acquisition.
Organization wide deployment of Competency
based HR system design and implementation
National level vision for AC (NAC) by NASSCOM
(National Association of software and service
companies); state Govt.’s Dept of education initiative
for standard XII students’ preparation for
employment in emerging BPO organization
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The summary or Trend analyses
2008-2010
Organization wide deployment of Competency based HR system
design and implementation or isolated competency based HR
system design e.g.,
Competency based performance management system
Competency based promotion system,
Competency based Graduate engineers’ on campus selection
system,
Competency based Technical & Managerial training systems
Strategic leadership development as a proxy to OD
Airlines Pilot, Cabin crew, Maintenance engineers
In Automobile, Petrochemical and refinery, Petroleum product
marketing company, PSU,
Few IT telecommunication
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India Business Environment,
Opportunities*
Strong Growth Momentum
• Sustained process of liberalization (since 1991): Continuous GDP growth,
Increased openness to foreign trade and investment - declining tariffs,
liberalization of FDI restrictions
• Rapid growth in export-oriented IT, ITES/BPO, & Retail industries
• Manufacturing is a strong base
• Fast growing Automotive sector (India is highest 2-wheeler producer in the
world)
• The above has stimulated Indian industry to restructure for international
competitiveness
• Strong balance of payments - rapid build up of reserves
• Growing portfolio investment
• Cross-party support continued for liberalization in-spite of coalition Govt.
Based on International Finance Corporation report, CDC report and other published data]
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Remaining Growth Constraints
• High fiscal deficits crowd out public and private investment
• Severe infrastructure bottlenecks
• Rigidities in labor and land markets
• Widespread Govt. ownership of business, dominance in banking
• Corruption is wide spread; particularly in Govt. regulatory
institutions (proximity to the government is an enormous source
of profitability in India)
• More than 30% of Indians survive below poverty line and India
has the second largest number of billionaires, second only to
Russia
• Import tariffs, complex tax regimes
• Restrictions on FDI in some sectors
• Excessive regulation increases costs of doing business
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Investment Climate at a Glance
in early 20th
century
China India Thailand
% of Sr Mgt time
with Govt. officials
9.2% 16%
Share of firms with own 30% 69% -
generators
Days to clear imports 12 21 24
(longest)
Cost of Shipping 5.4% 8.5% 6.7%
Paved Roads (% of 88% 56% 97%
total)
Cost of Capital 5.85% 12.3% 7.8%
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Opportunity
Large, rapidly growing domestic market. Phenomenal
increase of disposable income in the hands of ever growing
Middle class (350 million strong middle class which
commands a formidable spending power)
Large, low cost labor force availability (though business of
labor arbitrage is under pressure but growing)
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Opportunity
World’ largest supply of scientific Man-power (but only
18% of the fresh technical graduates in India possessed
the right skills for jobs in IT services companies)
Engineering/IT/English language skills
Abundant availability of raw materials
Political instability, but consensus on economic policies
Growth in private ports and SEZs (special economic
zones) addresses lack of infrastructure for export-
oriented industry
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High Potential Sectors in India
Knowledge based organizations, as for example, Software
services, ITES (BPO/ KPO)
Autos and components
Medium Engineering-based manufacturing
Steel
Textiles
Pharmaceuticals
Alternative to China for companies looking to source
merchandise globally
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Knowledge based organizations, as for example,
Software services, ITES (BPO/ KPO)
1. Behavioral competency is not enough for these Knowledge
based organizations. They need complex technical
competencies, Techno-behavioral competencies, domain
competencies, quality competencies for superior technology
transfer, R & D, and superior service
2. Talent supply:
Macro level data shows talent availability is in abundance. The
ground reality is very different; competencies are not aligned,
employability is low. Labor Market supply of competencies
do not match the companies’ demand matrix of
competencies. Pre-job and post employment competency
development is of dire need of the day.
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Knowledge based organizations, as for example,
Software services, ITES (BPO/ KPO) Contd.
Talent shelf life is decreasing:
Commitment to organization has diminished, work environment is
very stressful, retention is serious problem, no patience,
employee change job frequently, immediate money is first
priority, the younger generation seem to have very different life
plans
As knee jerk response, Organizations getting into bonds, variable
pay, pay for performance, mechanism to increase control almost
to obnoxious level. Reducing further psychological identification
and getting into pure transactional relationships; everything
is matrix driven no time for vision or innovation.
Talent supply is critical theme for management: Talent mix
strategy is critical success criteria
How much to buy (lateral hire – often 20-30%)
How much to grow internally (entry level hire – typically 70-80%)
pushing cost of development higher
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Knowledge based organizations, as for example,
Software services, ITES (BPO/ KPO) Contd.
Multi geography HR management challenges (uniform
corporate HR policies can not work across
nations)
New theme related to Customer priced
Competency emerging (competencies for which
customer is willing to pay): strict SLA (service level
agreement) deployment & delivery competencies
are flavor of the day
New theme related to Techno-behavioral
competency becoming critical (e.g., configuration
management ability, release management ability,
technology mentoring ability, Project management
ability etc.)
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For Manufacturing and Auto sectors
Competition is too severe, growth is sudden and at a never seen
before level, volume pressure, cost pressure, reducing margins
are normal events
Line Mangers (in the upper middle level of the hierarchy) moving
up in the hierarchy based on core value chain
competencies, organization is heavily dependent on these
employees; there is scarcity of supply and it takes very long to
develop these talents. Unfortunately they have severe
deficiencies in People Management Competency-cluster and
Business management Competency-cluster. Both these
competencies are too critical to function effectively on the job
(external supply from HR service and Finance service proving
to be futile)
Salary hike to attract and retain has gone high disproportionately,
making cost of Management too high in comparison to
compensation to employees in operation. Employee
satisfaction index is going for toss.
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The issues from current reality, mentioned above has
brought Competency Management, Organization
design, OD into the centre stage.
These challenges are opportunities, in near terms, for
you my colleague listeners
If you are planning to come to India to set a shop you
are going to face these Challenges and consequent
opportunities
To the extent Indian scenario matches with business
metamorphosis here in South Africa these will
emerge as ground reality here too.
Hope the insights will be of some help to you.
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Revisit the Objectives (contd.)
Objective:
Insights for HR-Professionals and Enterprise
owners based on macro level secondary
data and ethnographic approach
Ideas about setting up business in India specific
emerging Industries
Ideas about specific business opportunities for
AC-professionals and Management
consulting in general
